Bug in Net Worth Report Quicken 2007 Premier?

Just upgraded to 2007 Premier, running Quicken for over 10 years, never seen the following issue before.
When running a Net Worth report the results do not agree with the
portfolio values or the investing account total numbers on the left side of the screen. Yes, the dates are the same (current date) and all options are checked to all accounts, categories etc. etc.
After some tracking down here's what I found.
Any stock that has paid a dividend shows it's current value in the net worth report off from the portfolio value by the amount of the last dividend paid. On those stocks that don't pay dividends the values check out ok.
If I run the net worth report for the day BEFORE the last dividend was paid for a particular stock, the report is ok and matches the portfolio value when I set the date for the portfolio to be the same as the net worth report.
Next, if I go into the account transaction register and change the last dividend to another value the value of the stock now matches exactly between the net worth report and the portfolio. If I set it back to where it was, it still agrees ok. So it looks like I have to make a change to the last dividend paid to get it to match.
It doesn't matter if the entry for the dividend was done 'manually, or copied and pasted from the last dividend paid.
I ran a Super Validation check on my data and there are no problems.
Anyone else confirm or deny this issue?
Cheers
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Auburn Bob wrote:

I don't recall reading of it before, and my very quick test just now did not reproduce the problem. (Q2007 Premier, R4).
Have you tried creating a New Quicken file, with an investment account, one security, buy some shares, then enter a dividend transaction ... to see if the problem could be related to your current Quicken data? (Validate does not catch all corruption, especially in investment accounts and the price history.)
--
John Pollard
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John,
I've learned more, and has a workaround, but it's beyond my pay grade for sure.
Before I upgraded to 2007 I was still running 2005. In that version when I entered a Dividend payment I entered it as Misc Income and then selected one oif the Dividend categories I created, either taxable or taxfree. In any case with that version I never saw any issues.
Since I posted my message I've been experimenting, and here's what I've discovered.
1] The issue is only for dividends that have been entered since I upgraded the program, since it was recently that's just last month's dividends. So it appears that something has changed in the way Quicken handles misc income entries between 2005 and 2007; not sure if that is good or bad or matters, but it's different.
2] If I enter the Dividend as "Dividend" in the Dividend field of the standard transaction form for Income entries, there is no problem, the Net Worth report is not affected. But since I like to break dividends down into taxable or taxfree this it not ideal for me.
3] However, and here's my workaround, if I enter the Dividend as before, Misc Income with my category AND I specify the same account as a Transfer Account it takes the dividend into the same account and again there is no problem with the Net Worth report. It's 'transferring' the dividend into the same account as where I'm posting the entry. Makes no sense to me, but at the end of the day the money ends up in the same spot and it fixes the Net Worth report issue.
What I DON'T understand is why if I go back to a transaction that didn't work, make a change in the dividend amount, save it, then go back yet again and change it back to the original dividend amount it fixes the issue. Unless I'm making some other mistake which is always possible, this sounds like a bug...
(And John, I know you know this, but others might not...when running the Net Worth report if you customize the report and check the box to show 'Account Detail' you can see all of your portfolio's stocks, and so can track where the difference is between the NW report and the Portfolio view. Also I am running 2007/R4 on Windows XP w/ SP2 system.)
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Auburn Bob wrote:

I wonder if there was some "innocent" corruption in your Q2005 data that became a problem after the conversion. Of if the conversion itself created some corruption.

You don't need to categorize dividends yourself to get this. If you have correctly designated your tax-deferred accounts as tax-deferred and correctly designated your tax-free securities (such as municipal bonds) as tax-free; Quicken can report your dividends correctly.
[I think there are really 3 classifications of dividends/interest: taxable, tax-deferred, tax-free. I think many retirement account dividends are tax-deferred, but will become taxable when the account holder withdraws from the retirement account. In other words, many retirement account dividends are never "tax-free".]

Just noting: I tried using a Misc Income transaction with a user created category ... and it did not affect my Net Worth any differently than a straight Dividend transaction.

There have been several instances when users modified (or deleted and re-entered) investment account transactions and got different (and correct) results. I have guessed the original transaction was corrupted, but I have no way to prove it.
If you were using copy/paste, you could have been replicating the problem ... though I recall you said you saw the problem when you entered a transaction from scratch.

Yes, "show account detail" is one of my favorite features, and I used it while trying to duplicate your problem.

Likewise.
You might still consider trying to replicate the problem in a New Quicken file ... I can't reproduce it here (my test data was converted from Q2006).
--
John Pollard
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John,
Well, I hate to say it, but I just created a new file and it's got the same problem. Here's what I did, perhaps you can duplicate?
1] Created a new file. 2] Added a new brokerage account with no securities in it. 3] Investing/Security List I added MSFT as a new security. 3] Bought 100 shares of MSFT into that brokerage account on 3/29/2007 for $26.00 4] Went to Tools/Category List and unchecked Hide for the Category "_DivInc" under Income. 5] Paid myself a $100 Dividend from MSFT on 3/30/2007 by entering the transaction as Income and $100 in the Misc field, then Chose Category for Misc as _DivInc 6] Go to the portfolio view and Download Quotes to update the portfolio value. 7] Run the Net Worth Report, and presto the Net Worth of MSFT is shown as $2,687.00 which is exactly $100 less than what's showing in the Portfolio view! [Of course since I ran this today, if you run it on another day the Market Value of MSFT will be different, but the $100 difference will still be there, I think...]
Interesting...if you can't duplicate this, I wonder what that will mean...or let me know where I've made a wrong turn...
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John,
One more post on this subject.
Just for fun, I uninstalled Quicken 2007 and then reinstalled it, ran the test again with a new file and it still does the same thing, so it's not a corrupted installation.
Also I've confirmed that I can use your tip to just enter the dividends in the dividend field and Quicken will correctly identify it as taxable or taxfree according to the information on the security in the security list. So I will do that in future.
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Auburn Bob wrote:

I was in the middle of trying to duplicate and lost power for several hours. Finally managed to get back on track.

I attempted to exactly duplicate what you did ... including creating a new Quicken file (all my previous tests were done in a pre-existing test file with many accounts/transactions ... I have no idea why that should have mattered). I was able to produce some strange - and, I think, incorrect results - but not quite the same as yours.
My Net Worth report showed MSFT having a "Balance" (Market Value) of $2800 ... which is $13 *more* than its "true" Market Value based on price/share. The Portfolio Value report showed MSFT's "Balance" (Market Value) as $2687 ... $100 less than its actual Market Value, and what you saw in your Net Worth report.
I noticed something else interesting on the Portfolio tab: The Portfolio tab showed the correct Market Value for MSFT: $2787; but the Cost Basis was incorrectly reported as $2700. Also when I expanded the "+" alongside MSFT to see the "lot" I bought, that one lot showed the correct Cost Basis of $2600; just the "total" for MSFT (which should only include that one lot) shows the Cost Basis of $2700.

I'm not sure what to make of it either. Given there is a workaround, I don't know if further investigation would be useful ... but if someone can give me a reason, I'll consider trying.
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John Pollard
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It could be a problem w/using the misc. income field for investments in '07q.
I ran into major issues (different than this) with misc income which I have described here & in the forum; I did send an email & received the following from quicken: "what I understand from the email that you are getting incorrect cost basis after entering the miscellaneous income in investment account. I duplicated this and got stuck at the same place. This seems to be issue with Quicken software. I apologize for the inconvenience. You have a valid point. I will surely pass this to the development team." The op might want to send a bug report.
So far there has not been a fix.
--
PSJ




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John,
I went back to my test file, and sure enough, my portfolio shows the same error as yours on the basis when you expand MSFT to look at the lots.
Another point: what I referred to as your TIP is actually the only workaround. Although 'transferring' a dividend to the same account gives the correct net worth report, the dividend itself then doesn't show up as increasing the cash in the account. (I just discovered this as I was entereing new transactions for the end-of-month reconciliation.)
In other words, the correct workaround is to use the Dividend or Interest field to record the payment and stay away from Misc Income altogether.
Given the added input from PSJ and the fact that changing and rechanging back a MiscInc transaction consistently 'fixes' it makes me kind of uneasy about the state of our files as we go forward.
Bob
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