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Overview of Assets and Liabilities

Introduction

Assets and Liabilities (A&L) provides a means to record various financial transactions within the context of a trust.  This is not intended to provide a full set of accounting features but rather a limited suite suitable for non-trading trusts with modest accounting needs.

At the core of the A&L is notion of a transaction.  A transaction embodies a set of activities leading to a specific outcome - for example, acquiring an asset or forgiving some debt.  Over time the notion of a transaction will become more fully integrated with other aspects of the application allowing for the reference of relevant documentation and incorporation within specific workflows.

Transactions are associated with transfers which are credits and debits against account categories.  For example, acquiring an asset will create a new account representing the asset and a transfer to that account to the value of the asset upon acquisition.  Balancing this transfer will be transfers to expense accounts where additional expenses have been incurred and transfers from loan or bank accounts recording where the funds were sourced to acquire the asset.  In effect a transaction is simply a journal entry capturing the various flows of money relevant to that transaction.

As noted above, transfers credit and debit amounts from account categories.  The A&L supports standard expense and income categories as well as bank accounts, assets accounts and loan accounts.  There are several special accounts that record distributions to beneficiaries, capital gains and losses on revaluation or disposal of assets and net gifting.  You are free to create any account categories as you see fit relevant to the activities of the trust.

Summary Page

When you first access the A&L section by clicking on the Assets & Liabilities tab at the top of the screen, you will see a summary page.

Initially there are not categories configured.  Take the time now to review the activities that the trust is likely to undertake and create categories for expenses and income relevant to those activities (for example, if the trust owns a house and is paying for rates and insurance then create rates and insurance categories as expenses).  Loans to third parties (such as the Settlors) also need to be created along with any bank accounts or bank loans.

Once accounts have been established and transactions performed the summary page will provide a summary of position for the trust across the various account categories.

Accounts Section

The accounts section lists the various accounts setup for the trust.  The accounts may be filtered by various account classes as well as searched on.  Clicking on an account will display a summary of the account in right hand column that includes a listing of the most recent transfer into or out of the account (these are associated with transactions).

In the example above we have created a number of accounts and have selected a bank loan account.  The summary of the account indicates a debt current balance of $140,000.00 that was a result of acquiring the 59 Hobbleton Street property.

Note that you can select multiple accounts by clicking on the checkboxes while clicking on the account (but not in the checkbox) will select just that account, removing all other selections.

Transactions

The transactions section lists all transactions by date order.  Again, these are able to be filtered by transaction classification and searched on.

As with accounts, clicking on a transaction will display a summary of the transaction in the right panel.  In the example above the asset purchase of the 59 Hobbleton Street property is selected and the various transfers associated with the transaction are displayed.  We note here that we have recorded a purchase price of $350,000.00 for the property along with $1,200.00 in legal fees.  The funds for these expenses have been provided by both mortgage to the trust and by loan from the Settlors (treated jointly for the purpose of this demonstration).

Reports

Several standard reports are accessible in the reports section.  These will be expanded over time.

In the example above we have the income and expense report detailing the legal fees associated with the purchase of the 59 Hobbleton Street property and some income received for a short term rental of the property to a beneficiary.

Feedback and Roadmap

Our intention is to expand the A&L to integrate more tightly with other sections of the production including document association and workflow incorporation.  We are also expanding the assets functionality to more fully support portfolio management.

If you have any feedback or recommendations we would welcome those as we look at every opportunity to improve our offering.

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