How to enter a normal merger

In a merger (also called a "takeover"), a company in which the club owns stock is merged into one or more companies. After the merger, the club owns shares of the new company and no longer owns any shares of the old company. Club Accounting transfers the dollar cost basis from the old company being merged into the new company.

If the broker reports the transaction as a cash only merger, this is not a merger transaction in the software. Enter it simply as a sale of the stock for the cash received.

To enter a new Merger transaction in Club Accounting 3

1) From the top toolbar, select Transactions > Merger

2) Transaction Date - You may use the dropdown calendar function to select a date, or you can type in the date directly into the Transaction Date field. The default is the current date.

3) Select Transaction Type - this should already be set to Merger.

4) Select Account - select the account to receive any cash-in-lieu from this transaction. The dropdown list includes all active accounts.

5) Select Old Security – from the drop-down list, choose old company, the one you held prior to the merger. If the security does not appear on the list, select Show Inactives to show securities that have been sold.

6) Old Security Price Per Share – Leave this blank.

7) Cash Received – Enter any cash received in place of a fractional share. Club Accounting will then automatically enter a Sell transaction for the fractional share for you for this amount and any fractional share entered in the Shares Received field. The transaction cannot be saved if an amount is entered here but no fractional share is included in the Shares Received field.

Note: If your statement shows cash-in-lieu of a fractional share, but does not give the size of the fractional share, you can calculate the fractional share. Multiply your shares in the old company by the merger ratio. The ratio should be in the information packet sent by the old company. It is nearly always posted on the web sites of both the old and new companies, under Investor Relations or Stockholder Information.

For example,
• The club owned 9 shares of Stock ABC.
• Each holder of ABC received 1 share of XYZ for each 2 shares of ABC they held.
• The club received 4.5 shares of XYZ
• The 0.5 shares are sold off at the going rate of XYZ on the date of the merger. If that's $20, the club gets $10 cash-in-lieu.

8) Select New Security – Use the row next to the security that is acquiring the security you owned. If you did not already own shares of the new security before the merger, click Add New Security to add a security profile first.

9) Shares Received – Click in the field to enter the number of shares received. You must include any fractional share if cash was received for that fractional share. Club Accounting will then automatically enter a Sell transaction for the fractional share for you for the amount entered in the Cash Received field. For the example above, you would enter 4.5 shares, not just 4 shares, even if your broker statement says only 4 shares.

10) Price per Share – Click in the field to enter the price of a single share of the new company on the day of the merger.

Click the OK button to add the transaction. The Confirm Transaction window appears asking you to review the details of the entry. If the information is correct, click the OK button to record the transaction. If not, click the Cancel button to return to the Enter New Transaction – Merger screen.

Click the Cancel button to close the Enter New Transaction screen without adding a transaction.

To enter a new Merger transaction in Club Accounting Online

1) Select Accounting > Securities > Merger

2) Transaction Date - type the date directly into the Transaction Date field.

3) Merging Company – from the drop-down list, choose old company, the one you held prior to the merger.

4) Number of Daughter Companies – In general, this is just one. If you received stock in more than one company as a result of this merger, record the number of companies in which you received stock.

Click continue to move to the next page.

5) Price per Share – Skip this field..

6) Symbol of the new company – Enter the ticker for the security that is acquiring the security you owned.

7) Shares Received – Enter the number of shares received. You must include any fractional share if cash was received for that fractional share. Club Accounting will then automatically enter a Sell transaction for the fractional share for you for the amount entered in the Cash Received field.

Note: If your statement shows cash-in-lieu of a fractional share, but does not give the size of the fractional share, you can calculate the fractional share. Multiply your shares in the old company by the merger ratio. The ratio should be in the information packet sent by the old company. It is nearly always posted on the web sites of both the old and new companies.

For example,
• The club owned 9 shares of Stock ABC.
• Each holder of ABC received 1 share of XYZ for each 2 shares of ABC they held.
• The club received 4.5 shares of XYZ
• The 0.5 shares are sold off at the going rate of XYZ on the date of the merger. If that's $20, the club gets $10 cash-in-lieu.

8) Price per Share – Enter the price of a single share of the new company on the day of the merger.

9) Cash Received – Enter any cash received in place of a fractional share. Club Accounting will then automatically enter a Sell transaction for the fractional share for you for this amount and any fractional share entered in the Shares Received field. The transaction cannot be saved if an amount is entered here but no fractional share is included in the Shares Received field.

10) Account - select the account to receive any cash-in-lieu from this transaction. The dropdown list includes all active accounts.

Click Submit to complete the transaction.