Starting to use FundCount again!

I am very excited as I am going to start using FundCount again. It has been a long time since I have used the software and I can't wait to get it reinstalled on my computer. FundCount is an amazing piece of software and I look forward to seeing all of the new features that have been added since I last used it!

Marco's beautiful dacha outside of Moscow

With spring now in the air, I am trying to imagine what Marco's dacha must look like outside of Moscow. In my imagination his dacha looks something like this (in the video above). Marco is a very hard working man and so I just hope he and his wife have a nice place to go to on the weekends.

And I hope he also invites Vitaly and Maxim to join him sometimes at the dacha, because they are very hard working people too.

And if you think this is too much dacha for Marco and his family and friends, just remember for a minute how hard they all work there at FundCount headquarters to provide us with the great support we've all gotten used to. The FundCount people start work at 11am local time. Then they work straight for 14 hours all the way until 1 o'clock in the morning next day. And remember, these people have families back at home. And so if you think this is too much dacha, just think again.

In truth, Marco probably doesn't have a dacha. ..But maybe someday he will! After all that hard work, heck, he deserves a dacha.

More on dacha's here: http://en.wikipedia.org/wiki/Dacha

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And in case you're wondering if I have a dacha too, well yes, in fact I do. ..I'm just fixing it up a little...

New method for accrued dividends

The latest version of the FundCount software helps automate the dividend accrual and settlement process. Now, instead of having to do general ledger entries to handle the accruals and settlements, FundCount asks you to assign an "Accrued dividends account" for any brokerage account holding dividend paying stocks.

Then when it comes time to enter the dividend into the database (Securities>>Corporate Actions Long>>Cash distribution), you select the security, then select the account that holds the security, then enter payment date and ex-dividend date, and now the software will automatically accrue the dividend at the ex-dividend date and settle the cash payment at the payment date.

The fact that the software automatically handles the cash settlement means that there will for the first time be entries in the database that cannot be edited via "Edit transaction" in the View/Edit/Delete All Transactions window. The only way to edit the cash settlements is to go back to the original entry for the dividend and adjust the payment date. FundCount handles the actual cash settlement entry on its own now.

Version 2.10.76

I recently upgraded to version 2.10.76. Incredibly I was still using version 2.6.40, but I really loved that version because it was so stable and there were absolutely no problems with it.

I am still testing version 2.10.76, and will make a full report later. Right now, though, I am having problems creating PDF files. When I create a "Performance and Capital Summary" report, I cannot make a PDF file of the report. When I click the "To PDF" button, FundCount brings up the "Calculating. Please wait..." notice and I sit there for minute after minute while the software "calculates." My guess is that the software is hanging on this function and is not getting anywhere. Twice now I have had to shut down my computer simply to interrupt FundCount which is stuck.

I will mention this to the guys in Moscow tomorrow, though, and since they are so quick at fixing problems, I'm sure it will be fixed very soon.

Marco Thomas and his dangerous commute home from work

Sometimes I feel sorry for my very hard working friend, Marco Thomas, at FundCount, because after a very long day at work he then has to face a difficult drive home to his wife. Here is a video clip of what Marco faces each time he drives home through this freeway tunnel in Moscow.

Do not accrue management fees unless you are crazy

In our fund we take the management fees out of the partners' capital accounts. By this I mean we do not take the 1% management fee in the form of an allocation to the General Partner. We take the management fee all the way out of the fund.

This I think is the way most funds should operate.

To drill down into a bit more detail, we actually charge the LP's capital accounts 0.25% at the beginning of each quarter. In technical terms this means we charge our management fee "quarterly in advance."

None of this has anything to do with "accruing" management fees. That's a different subject. I wanted to get everything setup first before diving into that discussion.

When you charge management fees in FundCount (i.e. when you do the management fee transaction in the database), you have the option to select "Accrued" or "Final Charge" for the type.

Now, when we first started doing the actual management fee transaction in FundCount we stupidly selected the "Accrued" option. (Again, you have two choices, 1. Accrued or 2. Final charge.)

If you select "Accrued" you are going to create a major headache for yourself when it's time to do the audit and when it's time to do the tax returns.

FundCount does not recognize accrued management fees as a deductible expense on the tax forms it generates. It only recognizes "final charge" management fees as a deductible expense for the given tax year.

Therefore, save yourself a major headache and don't ever accrue management fees. Only do that if you are crazy (and really want to go nuts at tax time).

Be sure to manually confirm FundCount's return calculations

I was motoring along in FundCount version 2.6.28, printing the first quarter partners' statements for 2006.

During the printing process, a figure caught my eye.
It was the "Gross return" figure and it didn't look right.

I whipped up an Excel spreadsheet to double check the calculation and sure enough the FundCount reporting was in error.

The lesson here is that it is very important that you double check FundCount's work on the Performance and Capital Summaries. There is zero guarantee that the return numbers are correct in any given version.

This happens occasionally as updated versions of the FundCount software get pushed out into production.

You would think that I would get upset about it, but then I remember how much money I am saving by not using Advent!

FundCount has some little quirks to it. The return reporting errors are something I have just learned to live with. Also, the FundCount people are very responsive in fixing the software errors. Just call them up and you'll get their attention pretty quick.

All in all, checking FundCount's work is a small price to pay for this wonderfully inexpensive software.

Editor's Note ...
This problem has subsequently been fixed.