Hi David, Thanks for providing a clear explanation of the options, it was very helpful for me.
Malcolm > On 6/01/2020, at 9:32 PM, David Cousens <davidcous...@bigpond.com> wrote: > > Malcolm, > > As others have said you really need professional advice. It will depend upon > your local legislation and how your business affairs are structured whether > you need to maintain separate books for your business activities or not. > What follows is an attempt to outline how GnuCash might be used and does not > constitute any advice that any of the suggestions are optimal for your > situation or even legal to use in your juridiction. In accounting a person > or business which has a separate legal existence (primarily responsibility > for the debts of the business) is usually referred to as an entity. A single > legal entity might however might have a number of separate business > activities which might have an operational separation but no separate legal > existence. > > GnuCash has the flexibility to be able to setup treatmentof your finances > either in one single book, two books for the business activities of yourself > and your wife and another one for your and your wife's personal activities > if that were suitable. The optimal strutcure will depend upon the taxation > and business legislation you operate under and its record keeping and > reporting requirements about which we cannot offer any advice. > > If you did use a single set of books, it would likely be a good idea to have > separate income, expense, asset, liability and equity accounts for your > personal activities and each of the business activities/entities. In GnuCash > the top level accounts are of type Asset, Liability, Equity, Income and > Expense and any separation of accounts between your activity/entities would > have to take place under each of the top level account. This would allow you > to structure separate reports for each activity for example. > > One limitation to keep in mind is that the business features of GnuCash, if > you have need to use them are not designed to support multiple entities in > the one set of book,s which might make business reporting difficult. > > If the books (files) were to be totally separate you would treat transfers > of funds into the business accounts from your personal accounts as a > decrease in your personal equity and an increase in your equity in the > business activity with the reverse for transfers from the business account > to your personal account with a transaction of the form > > Asset:CurrentAssets:Cheque Cr $xxxx > Equity: Dr $xxxx > > in your personal book/file (notated appropriately in the description and > memo fields and another separate transaction > > Asset:CurrentAssets:BusinessAccount Dr $xxxx > Equity:Owners contributions Cr $xxxx > > in the separate book/file for the business. > > If you were using a single set of books (file) a transfer of funds might > look like > > Asset:CurrentAssets:Cheque Cr $xxxx > Asset:CurrentAssets:BusinessAccount Dr $xxxx > Equity:Personal Dr $xxxx > Equity:OwnersContributionstoBusiness Cr $xxxx > > which would be a single transaction with what are called 4 splits or entries > in Gnucash to the four accounts. > > Hope this gives you some ideas about how GnuCash might be used to discuss > with your accountant. > > David Cousens > > > > ----- > David Cousens > -- > Sent from: http://gnucash.1415818.n4.nabble.com/GnuCash-User-f1415819.html > _______________________________________________ > gnucash-user mailing list > gnucash-user@gnucash.org > To update your subscription preferences or to unsubscribe: > https://lists.gnucash.org/mailman/listinfo/gnucash-user > If you are using Nabble or Gmane, please see > https://wiki.gnucash.org/wiki/Mailing_Lists for more information. > ----- > Please remember to CC this list on all your replies. > You can do this by using Reply-To-List or Reply-All. _______________________________________________ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. ----- Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
