Adrien, Yes, that’s formally correct. As I’ve said repeatedly in this thread, GnuCash has long had a design feature that one can get a balanced Balance Sheet report without closing one’s book. The Balance Sheet report does that by summing up the expense and income accounts’ balances and reporting the total in a “Retained Earnings” line. If one has closed one’s book in the past and so has a “Retained Earnings” account, the Balance Sheet report will have two lines called “Retained Earnings”.
Regards, John Ralls > On Aug 12, 2018, at 10:26 PM, Adrien Monteleone > <adrien.montele...@lusfiber.net> wrote: > > Are not Retained Earnings part of Equity? And then, that account would only > be used in a close books process, not without it. Closing the books should > zero the income and expense accounts TO Retained Earnings. > > Regards, > Adrien > >> On Aug 13, 2018, at 12:04 AM, Christopher Lam <christopher....@gmail.com >> <mailto:christopher....@gmail.com>> wrote: >> >> Hi Jralls >> >> So just wish to double check my understanding of gnucash's data format for a >> balance-sheet on date X >> >> There are two possibilities for displaying the right-hand-side >> >> 1. Liabilities + Equity + Retained Earnings + Trading Balances >> 2. Liabilities + Equity + Retained Earnings + Unrealized Gains >> >> "Retained Earnings" should be NULL if the user has properly closed the books >> on the balance sheet date X. >> >> In my understanding, "Trading Balances" and "Unrealized Gains" are one and >> the same -- in balance-sheet.scm the unrealized-gain-collector is only >> populated if book->trading-accounts setting is disabled. (btw this causes a >> 'bug' whereby a book with 'enable-trading-accounts', but was later switched >> to 'disable-trading-accounts' will then add both the >> unrealized-gain-collector and the trading-balance the right-hand-side). >> >> This seems to be deconstruct current balance-sheet? >> >> (I can't seem to find any unrealized-gain issue... from using different >> price-sources... perhaps this is beyond my understanding.) >> >> >> On 11/08/18 22:41, John Ralls wrote: >>> Chris, >>> >>> Remember that we’ve long advised users that they need not close their >>> books, they can run a balance sheet report for any day. IMO removing that >>> capability would be a major breakage. >>> >>> I suspect that you needed to use trading accounts because you didn’t book >>> the trading gains and losses as income. Users should do that regardless of >>> using trading accounts and doing so should make it unnecessary for the >>> balance sheet report to include trading accounts. >>> >>> Unrealized gains are another matter entirely and are a result of using >>> prices from the price database instead of actual cost from the transaction >>> data. IMO the balance sheet report shouldn’t be taking prices from the >>> price db and shouldn’t be able to see unrealized gains, but if price source >>> is going to be an option then an unrealized gains line flows from that so >>> that users don’t waste a bunch of time chasing an imbalance caused by price >>> differences. >>> >>> https://bugs.gnucash.org/show_bug.cgi?id=775368 >>> <https://bugs.gnucash.org/show_bug.cgi?id=775368> is related because that’s >>> currently how the balance sheet report gets the “actual” costs. >>> >>> Regards, >>> John Ralls >>> >>>> On Aug 10, 2018, at 11:40 PM, Christopher Lam <christopher....@gmail.com >>>> <mailto:christopher....@gmail.com> <mailto:christopher....@gmail.com >>>> <mailto:christopher....@gmail.com>>> wrote: >>>> >>>> Hi John >>>> >>>> I've managed to make the left-side (activa?) match the right-side >>>> (passiva?) >>>> >>>> https://screenshots.firefox.com/RNvkjaxnYyxpGkYn/null >>>> >>>> 1) it does require closing books on the balance-sheet date >>>> >>>> 2) it does require adding trading-accounts >>>> >>>> The existing balsheet introduces/calculates the "Retained Earnings", >>>> "Trading Gains" and "Unrealized Gains", whereas the current iteration of >>>> new-balsheet will not. >>>> >>>> To me this is the easiest method to ensure both sides produce the same >>>> total, and is now technically correct - if the user has not closed their >>>> books, the balance sheet won't balance. >>>> >>>> This is giving me a headache :( >>>> >>>> Should a new balsheet calculate and report these '(fake) retained >>>> earnings', and 'unrealized gains' ??? >>>> >>>> C >>>> >>>> >>>> On 09/08/18 08:32, John Ralls wrote: >>>>> >>>>>> On Aug 8, 2018, at 8:51 AM, Geert Janssens <geert.gnuc...@kobaltwit.be> >>>>>> wrote: >>>>>> >>>>>> I haven't been following every detail of this. However I note on most >>>>>> balance >>>>>> sheets the total assets doesn't match total net worth (or >>>>>> liabilities/equity). >>>>>> In most, this is fixed by including the retained earnings. >>>>>> >>>>>> I believe at least in most European countries the "left hand side" >>>>>> (Assets, >>>>>> Active) and "right hand side" (Passive or liabilities + equity) of the >>>>>> multicolumn view should balance (it's called balance sheet for a reason). >>>>>> That would suggest retained earnings does have to be part of the balance >>>>>> sheet. >>>>>> >>>>>> However I'm not an accountant and perhaps your book is slightly >>>>>> contrived so I >>>>>> don't know the exact answer here. >>>>>> >>>>>> As for the "multi-column" vs one column debate, both present the same >>>>>> data. >>>>>> The only difference is visual representation or style. >>>>>> >>>>>> As of recently I have become a strong proponent of separating structure >>>>>> (or >>>>>> accounting functionality in a different context) from style, I think this >>>>>> should be delegated to the realm of css. This particular layout >>>>>> variation can >>>>>> IMO be handled by making divs for each large group and either let them >>>>>> follow >>>>>> normal flow or use float to move them next to each other. If you will >>>>>> you can >>>>>> have a European style sheet and an American one, or an Australian or >>>>>> whatever. >>>>>> >>>>>> As for "categories", I read Frank's earlier reply as if he agreed that at >>>>>> least for now the account organization is something to be done in the >>>>>> CoA, not >>>>>> in report code. >>>>> The Balance Sheet is indeed supposed to balance, but in normal practice >>>>> it balances only when the book is “closed”, i.e. when all of the income >>>>> and expense accounts are summed up and added to Equity. In US corporate >>>>> books the cumulative total of income and expenses lives in an Equity >>>>> account called “Retained Earnings”. >>>>> >>>>> In the pen-and-paper days a “Trial Balance” was computed outside of the >>>>> books before closing as a way to catch errors before making the closing >>>>> entries and writing the formal Balance Sheet. >>>>> >>>>> GnuCash's existing Balance Sheet Report creates the “Retained Earnings” >>>>> line so that one need not close the books (Tools>Close Book) in order to >>>>> get a balanced report. Removing that feature might be more formally >>>>> correct but it would mean that users would have to close their book >>>>> before running a balance sheet. That would be a big change and I don’t >>>>> think that we want to do it. On the other hand “Retained Earnings” isn’t >>>>> the right term for many cases, so it would be a useful improvement to >>>>> make it configurable. >>>>> >>>>> There’s a second problem with the current report as well: If the user >>>>> does close their books periodically they’ll have an account for the >>>>> accumulation that may well be called “Retained Earnings”. The Balance >>>>> Sheet Report will dutifully report the contents of that account and, if >>>>> there are income and expenses after the last close, add a second >>>>> “Retained Earnings” line. That looks a bit odd and might be confusing; >>>>> ISTR we’ve had comments on the user list about just that. >>>>> >>>>> Regards, >>>>> John Ralls >>>>> >>>>> _______________________________________________ >>>>> gnucash-devel mailing list >>>>> gnucash-devel@gnucash.org >>>>> https://lists.gnucash.org/mailman/listinfo/gnucash-devel >>>> >>>> _______________________________________________ >>>> gnucash-devel mailing list >>>> gnucash-devel@gnucash.org >>>> https://lists.gnucash.org/mailman/listinfo/gnucash-devel >>> >> >> _______________________________________________ >> gnucash-devel mailing list >> gnucash-devel@gnucash.org <mailto:gnucash-devel@gnucash.org> >> https://lists.gnucash.org/mailman/listinfo/gnucash-devel >> <https://lists.gnucash.org/mailman/listinfo/gnucash-devel> > > > _______________________________________________ > gnucash-devel mailing list > gnucash-devel@gnucash.org <mailto:gnucash-devel@gnucash.org> > https://lists.gnucash.org/mailman/listinfo/gnucash-devel > <https://lists.gnucash.org/mailman/listinfo/gnucash-devel> _______________________________________________ gnucash-devel mailing list gnucash-devel@gnucash.org https://lists.gnucash.org/mailman/listinfo/gnucash-devel
