Hello everyone!

We are finally getting the opportunity to transfer stock in
lieu of cash for a total withdrawal. I went to the Bivio
"demo" club to test out the screens. It allowed me to see
the stock transfer screen, but it wouldn't let me complete
the transaction.

I know the number of shares are based on the current price,
as of the date of valuation, but I wanted to see how the
cost basis played out for both the departing member and the
club.

Can I assume that, on the club's portion, the program simply
removes those shares and their actual cost basis from the
investment screens, and that the actual transaction between
the club and the broker is a non-event on paper?

And, will the withdrawal statement calculate the departing
member's proper cost basis for the shares they receive?

Thanks, as always.

Lynn Ostrem
www.bivio.com/crowriver

Lynn,

You might want to look at the withdrawal reports for the demo club for
Elina Rutledge. That report will show the details of the withdrawal,
along with the allocation of the basis to Elina for the stock
transferred. Also, you could try a test transaction in your own club and
later delete it, so you can see how it works. I would suggest that you
export your file [see Tools] before you do that, so you can restore it
if anything goes wrong.

<<
Can I assume that, on the club's portion, the program simply removes
those shares and their actual cost basis from the investment screens,
and that the actual transaction between the club and the broker is a
non-event on paper?
>>

An accounting entry is made, reducing the member's basis to zero and
reducing the stock transferred by the clubs basis for the shares so
transferred, with the difference going to unrealized gains. You can see
this for Elina Rutledge by looking at the transaction ledger around
August 4, 2000.

<<
And, will the withdrawal statement calculate the departing member's
proper cost basis for the shares they receive?
>>

Yes. Again, look at the withdrawal statement for Elina Rutledge and you
will see the cost basis for the shares transferred.

Rip

Hello Rip,

Thank you for your reply. I was smart enough to go to the demo club, but I
didn't think to check the withdrawal reports for prior department members!
That was pretty slick! It answered all my questions without having to
actually mess with my own books.

Thanks again!

Lynn Ostrem
Crow River Investment Club
www.bivio.com/crowriver