Did you get an answer on this? I do the same thing with my property taxes,
homeowners and auto insurance. When I entered these into Money I listed it
as an annual payment to be paid monthly. So on my budget it shows the total
$600.00 but only $50.00 for the month.

"C.W. Parker, Jr." wrote:

- quote -

If you want to get real picky about it, the expense does not occur in a
single big chunk. The cash flow does. If it were GAAP accounting, you'd
record the payment to an asset account ('prepaid insurance') then expense
the monthly insurance out of that account. Budget will look right because
the expenses are amortized of the life of its value. Cash flow will look
right because it appears in chunks.

Personally, I just segregate my budget into things that occur routinely, and
things that don't. I compare routine expenses to their monthly budget, and
compare non-routine expenses only to the total annual budget for those
amounts. It evens out in the end.
--
Chris Cowles
Gainesville, FL


Dick Watson wrote:
- quote -

This isn't calculus. I'm not a CPA but believe GAAP covers it to the degree
of granularity of the reporting period.

For our purposes, it's splitting hairs. Since Money handles it the way Money
handles it, this discussion is simply splitting hairs.

As I said, I just analyze my budget vs actual over the period I expect the
budget to be accurate. For irregular items, I compare it to annual total;
for regular items, I compare it to monthly.

Dick Watson wrote:
- quote -

So for an annual payment for something that has expense continuously, how
often would GAAP recognize the expense? What's the integral of my insurance
cost over a millisecond? There's only so far you can go with this...

"Chris Cowles" <NoSpam[at]For.me> wrote in message
news:%23U2aSOQsFHA.3216[at]TK2MSFTNGP12.phx.gbl...
- quote -

On 1 Sep 2005 18:27:27 -0700, "Steve" <sjcohen730[at]aol.com> wrote:

- quote -

My reason for budgeting this way is that it is much easier to pay 1/12
of a premium each month than to come up with say $700. or $800.
whenever it comes due. I suppose each person has their own way of
handling this -the method described above is the way i do it. :-)

Thanks for your replys.

Chuck Parker

The only comment I have is that while I agree about a plan for a long chunk
of time, if you can't measure progress in smaller increments, you can only
compare plan to actual with any precision too late in the game to do any
good. This is why I think the monthly cycle is fine--as an increment of a
yearly or whatever plan--but expenses scheduled to occur in one month should
not be apportioned across twelve. I don't want positive variance 11 months
of the year and a huge negative variance in the twelfth month for an annual
expense.

"Steve" <sjcohen730[at]aol.com> wrote in message
news:1125707006.233506.325860[at]o13g2000cwo.googlegroups.com...
- quote -

Steve wrote:
- quote -

You are correct.

I guess we all agree that Money should allow each of us to budget the
way we want to. Coming from an accounting background, I have always
thought of budgeting as a plan for a year. The attempt was to plan out
the income and expenses AS YOU THINK THEY WILL OCCUR AT THAT POINT IN
TIME when the budget or plan is developed. We then updated this budget
or plan monthly and called it a forecast. This was a more current up to
date look at what we thought the budget or plan would look like. WE
NEVER CHANGED THE BUDGET OR PLAN FOR THE YEAR. I do my personal
budgeting and planning that way. I would also like the ability to
update the information from the budget, but in an other area called
forecast. Bottom line is I want to plan for the year ahead with a
budget and then compare my actuals against the budget AND the updated
forecast. I don't think Money 2006 can accomplish all this for me
easily. Steve

I want BP to support me budgeting something when I want it to be budgeted.
If that's monthly, so be it. Every September, so be it. The problem with the
present design is that it converts everything to monthly. I also want to
budget what I want to budget. The present assumption that anything scheduled
is, by definition, in the budget is ludicrous.

"William R Wood" <w.wood[at]cox.net> wrote in message
news:uHab9JAsFHA.460[at]TK2MSFTNGP15.phx.gbl...
- quote -

"Steve" <sjcohen730[at]aol.com> wrote in message
news:1125624447.320607.160190[at]f14g2000cwb.googlegroups.com...
- quote -

Steve,

Actually I agree with Money on this one. I want to know what my income and
expenses are on a monthly basis so I can track my budget throughout the
year. Even before I used money I divided my annual bills by 12 to get the
monthly figure. If you have an insurance bill that comes due in December
each year that does not mean insurance is free from Jan through Nov. so many
folks divide by 12 to show the real cost on a monthly basis. Also there is
a big difference between a Budget report and an Income & Expense report.
The Budget report should contain monthly figures even for items are paid
once a year, but Inc&Exp reports only show what was actually spent so they
will not have entries for annual expenses except in the month that the bill
is really paid.

Of course that's my opinion and your way is certainly valid as well. I wish
software developers would give users more choice in how programs work so
people would be able to do things the way they want to.

And just to clarify, Money does recognize the actual timing for annual
payments. In Bills and Deposits only the once a year payment is tracked so
you are always reminded of the real due date. But in budget reports and the
budget summary Money shows 1/12 of the annual expense so you can see more
accurately how you stand on a monthly basis. Money's budgets work really
well for me and I have no problems getting super accurate budgets. But note
that I am using Money 2002 and cannot speak for later versions. In fact I
have never used any of the newer versions of Money because a major bug was
introduced into the budget reports in ver 2003 and the remained in 2004,
2005 and 2006.

Regards

Bill

Bill, not sure what Chuck meant either, but why budget an annual
expense that is paid once a year as a monthly expense? Seems to me that
the budget should recognize the actual timing of the payment and budget
it that way. Not quite sure how Money does this because, although I do
budget in Money I use the reports only as a guide because I know the
budget program has many flaws. Steve

"C.W. Parker, Jr." <cparkerjr[at]ec.rr.com> wrote in message
news:vr0eh1dvlcgngomo4phjusq2ksmolteq7o[at]4ax.com...
- quote -

I may be confused. I pay my homeowners insurance once a year. I simply
create an expense item in Bills & Deposits and put the annual premium in
there with the appropriate due date. After that you don't need to do
anything because Money automatically budgets 1/12 of the annual amount on a
per month basis and shows that figure in all monthly budget reports. Your
income and expense reports will show the annual payment, not monthly
payments, since that is what is actually happening. I certainly would not
create a liability account since you don't owe anything if you are paying
the bill annually in advance. If what I say is not accurate you will need
to explain what you are talking about more clearly.


--
Regards,

Bill Wood
Fountain Hills, AZ

Does anyone know how to do transactions such as Homeowner's Insurance
to pay the premiums in 12 equal payments but is paid when billed by
the insurance company once a year? Currently, I am budgeting 1/12 of
the estimated premium each month in a line item in expenses. Each
month I transfer this amount to a liability account to be paid when I
receive a bill from my insurance company. The only problem is that it
the Homeowners line item in expenses shows no activity when it should
be zero.

Does anyone know how to set this up in Money. I hope i haven't
confused anyone trying to explain this.

Thank you

Chuck Parker