Investment Assets - Adding New or Existing Investment Assets

Investment Assets - Adding New or Existing Investment Assets

To add a new Investment Asset, click the CREATE NEW ASSETS button.
The ADD ASSET page will then be displayed. 

Select the type of Managed Funds / Shares (or other investment asset) from the dropdown menu.

Note: The difference between Australian Shares / Managed Funds and International Shares / Managed Funds is the option to incorporate franking credits.





After selecting the Asset Type, click NEXT. 

The ADD ASSET DETAILS screen will then open.  This screen contains all of the details relevant to the Investment asset.





Helpful Hints on Investment Asset Data Entry

1.      Asset Name
  • Enter a free text name of up to 40 characters, such as "Managed Fund Investment", or "XYZ Direct Shares".
2.      Owner
  • Depending upon how you entered the data for the client, the drop down for owner will include the name of each member and the option "Joint" (if you have created an SMSF entity, the SMSF entity may also show as a choice to select from as the owner of an investment asset)
  • The option you choose here will have an impact for modelling.  For example if the asset is owned by one member and not the other, any associated funding bank account will have to be owned by the same owner.  This is to ensure that all tax calculations and investment income is attributed correctly.
3.      Date Buy

Enter the date the investment asset was acquired OR will be acquired, if it is being purchased in the future.  If you do not know this date (for an existing investment asset), please ensure the date is prior to the model start date (i.e make sure it has already happened).   

Note:  With Investment assets, it is important to ensure this date is correct if you wish the system to calculate the Capital Gains Tax (CGT) implications associated with the asset if it is to be sold.

4.      Date Sell

This date should be set to "Model End", if the investment asset is not being sold.  
If you include an actual date, the system will sell down the investment asset and the proceeds of sale will then be made available.

5.      Current Cost Base

This is the purchase cost of the asset.  If you do not know this value, you can enter the current value.
Note:  With Investment Assets, it is important to ensure the purchase price / cost base is correct if you wish the system to calculate the Capital Gains Tax (CGT) implications associated with the investment asset if it is to be sold.

6.      Current Value

         Enter the current value of the investment asset.

7.      Rate Growth %

Enter the growth rate you would like used on the investment asset.  This projected growth rate should be based on the long term average for an investment that meets the client risk profile.   (Note: Some default return rates have been included, for your consideration.  Please adjust them according to your recommendations).

8.      Rate Yield %

Enter the yield rate you would like used on the investment asset.  This projected yield rate should be based on the long term average for an investment that meets the client risk profile.  (Note: Some default return rates have been included, for your consideration.  Please adjust them according to your recommendations).

9.      Rate Franking %

Enter the franking rate you would like used on the investment asset.  This projected franking rate should be based on the long term average for an investment of the type you are recommending.  (Note: Some default return rates have been included, for your consideration.  Please adjust them according to your recommendations).

10.      Reinvest Dividends

Click on the dropdown menu to select the appropriate option.  The options available are:

      *      Never 
              Never reinvest dividends; dividends will always be paid out.

      *      Always 
              Always reinvest dividends for the life of the plan.

      *      When Private Debt = 0
              Reinvest dividends only when there is no private debt. Dividends will also be reinvested in retirement                       (unless there is private debt)

      *      When Private Debt = 0, Cease at Retirement
              Reinvest dividends when there is no private debt, but cease reinvesting dividends at retirement.

11.      Rate Negative Growth %, Frequency of Negative Growth, First Year of Negative Growth

If you would like to show clients the effect a negative return would have on their portfolio, you can enter the Rate of Negative Growth you would like to incorporate into your model, along with how often you would like this negative growth to be incorporated, and which year you would like to commence the negative growth.


Ensure all fields with REQ next to the title are completed. 
Click ADD when completed to save the details.  Your entry should look something like this:


You will then need to add in the SOURCES OF CAPITAL / CURRENT DEBT FUNDING.

By scrolling downwards, AFTER you have clicked ADD to save the Asset Details, you will see the Current Debt Funding Details (as shown in orange in the diagram above).  This is where you link the loan account you earlier created on the Accounts screen to the Asset.  By doing this, the system knows that if the asset is ever sold, any debt remaining in the Loan Account at the time of the sale will be paid out immediately.

For a new asset to be purchased, the amount of funding must equal the cost of the asset.  If you are purchasing an Investment Property, and using $100,000 of Cash and $500,000 of ILOC funds, you need to include all of these details here.  

For an existing asset, that was purchased using any loan funds, you need to include the Loan Balance, and which Loan was used to fund the purchase of the asset.  As this asset is already owned, there is no need to enter details of any Cash which may have been used to purchase the asset.

Note:  The field "Keep?" simply means do you want to keep the entry.  If you want to remove the entry, click on the dropdown menu and select "No".    (You may have noticed there is no "BIN"icon on this screen).


Link to Next Article - Add an Investment Property Asset

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