Re: wrong tax basis

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In Reply to: Re: wrong tax basis posted by Mike T. on December 17, 2002 at 18:12:39:

: : : Mark
: : : With the spin off of Comcast, ATT sent out a worksheet to track ATT tax basis back thru 1959.

: : : Of course when I completed and checked the hand calculation of my att tax basis - it was wrong from FM file (shares correct). I'm sure I made a mistake or two in the FM spin off entries along the way over the years.

: : : I think one mistake was with the file |scale prices entry. Wrong date range or factor (many adjustments over the years) for the basis to be wrong, but to keep the # shares correct.

: : : I want to fix the FM basis now that I calculated the correct basis by hand. The problem is that I don't know how to fix it without screwing it up even more.

: : : I don't think I can audit and correct previous scaling entries like I can fix splits and so forth.

: : : The FM tax basis is way too low. I found that I can artificially inflate the original purchase price back in 94, to increse the basis, but I think that is the wrong approach.

: : : What do you suggest I do to correct the basis and maintain the correct number of shares?

: : : Thanks much.
: : : Mike T.

: :
: : Hi Mike,

: : I would suggest going back and fixing up your transactions/prices to reflect
: : what really happened. Depending on where you're at now, that may be more
: : work, but it is the most accurate. You can modify any transaction/price.
: : You can also un-do price scaling by scaling again by the inverse. Granted,
: : you have to know what you scaled by the first time, to un-do it.

: : The recommended way to handle splits is documented here:

: : http://www.fundmanagersoftware.com/spin.html

: : It sounds like you've been following that approach anyway.

: : Historical prices are easily re-retrieved using the Yahoo (Historical) quote
: : server. If you have a bunch of transactions, and you're not sure how you
: : scaled them, then you may need to debug this by looking at the recorded
: : price versus the actual price to figure out how much it has been scaled by.

: : Thanks,
: : Mark
: : --
: : Mark Beiley
: :

: Mark:
: I suspected the repair would be time consuming to implement. I was hoping for the 'magic bullet' fix.

: The fix would be trivial if the 'scale' operation was available for editing. I suspect that one (or more) scale operations I did had the wrong DATE RANGE. That error would take hours to find and fix. I think I'll start over with historical prices ;(

: You are the boss, but maybe an upcoming FM version will include a way to edit a scaling operation that went wrong (I can wish,,, it is Christmas!) I have 4 ATT accounts that need attention !!! I shake every time I use the scaling function because I know it is a one way trip!

: Thanks for the advice.
: Happy Holidays
: Mike

Hi Mike,

Sorry, I didn't have a better answer... I think what would really help
is to have a "spin-off" transaction that could be viewed/edited, like any
other transaction. Until that happens you may want to make use of the "Notes"
in Fund Manager to record what/when price scaling you did for any spin-offs.

Thanks,
Mark
--
Mark Beiley

Fund Manager, portfolio management software for Windows 95/98/ME/NT/00/XP
/XP

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