Google Stock Split / Spinoff

In early April, 2014 Google paid a 2 for 1 stock dividend (split) creating a new class of shares with no voting rights. This new class and the old class A shares have different ticker symbols and trade as separate entities.

As of this writing Google has indicated this is stock Dividend. Because a separately trading class of stock was issued we believe treating this as a spinoff will allow better tracking of the two publicly trading Google classes of stock. At the end of first day of trading the two classes had different prices per share.

Treat this action as a simple spinoff transaction in our accounting system. The information below is based on the information available on the Google web site. The cost basis allocation (Remaining Basis, in the spinoff) is taken from form form 8937, posted on the Google site at:

https://investor.google.com/pdf/2014_form8937.pdf

If Google changes or posts new information regarding this transaction that is contrary to the treatment given here, updated instructions will be posted.


Note that in 2015, Google performed a standard stock split on their GOOG shares. If you need help with that transaction, please see our FAQ at:
https://www.iclub.com/faq/Home/Article?id=415


Before the spinoff:

Because Google is using the original GOOG ticker symbol for the new Class C shares, entering this spinoff requires a little bit of preparation. Please read the section below appropriate for the club accounting system you are using before starting the spinoff transaction.

 

If you are using the online accounting at myiclub.com:
  • Go to Accounting > Securities > Security Settings
  • Click the Edit link next to the listing that has the GOOG ticker symbol.
  • Change the name to reflect that this will be Class A shares after the transaction. We suggest a simple change, such as Google CL A.
  • Make certain to change the ticker symbol to GOOGL.
  • Double-check to make sure that you also change the Quote Symbol box under advanced settings to the same GOOGL ticker symbol.
  • Click the Submit button, and you are ready to enter the transaction.

 

If you are using the desktop Club Accounting (CA3):
  • From the View menu, select Securities.
  • Double-Click on the existing entry for Google.
  • Change the name to reflect that this will be Class A shares after the transaction. We suggest a simple change, such as Google CL A.
  • Make certain to change the ticker symbol to GOOGL.
  • Click OK, and then OK again to confirm and save the changes.
  • On the left hand side of the window, click Add New under the Securities heading.
  • Enter a name for the Class C shares. Again, we suggest a simple entry such as Google CL C.
  • Make certain to enter the ticker symbol as GOOG.
  • Click OK, and then OK again to confirm and save the changes; you are ready to enter the transaction.

 
 

The Spinoff Entry:

Go to Transactions > Spinoff or Accounting > Securities > Record spinoff of securities depending on the version of the accounting system being used. If you are unfamiliar with spinoff transactions you can get help at this URL: https://www.iclub.com/support/kb/default.asp?page=normal_spinoff

Here is the information you need to complete the spinoff.

  • Date: 4/3/2014 (your broker may use a latter date, depending on when they posted the transaction. If there is a difference, you should default to using your broker's date for the transaction
  • Select Parent Security (or Parent Company) : Google Class A (GOOGL)
  • Remaining Basis Percentage: 50.08
  • Cash received: See your broker statement for cash-in-lieu received
  • Spinoff Security (or Symbol of New Company) : Google Class C (GOOG)
  • Shares received : 1 x (#of GOOGL shares owned) (Remember to include fractional shares.)
  • Price Per Share : 572.45 (An average of opening and closing price on 4/2/2014)
    • Even though it didn't cost the club any extra money to aquire the new shares, you MUST enter a price for the new Google shares, otherwise they will not be listed on your reports.

Save the transaction and the spinoff has been entered.