Monumental meanders : can I delete some splits to add/chge older entries?

Hi, Jay.

As my 4-year-old grandson often sings, "When you've got a BIG job, you gotta get a BIG machine!" And it sounds like you've go a big job here. :-{

During my 30 years of practice, I had to work out AT&T histories for several clients who had held Ma Bell shares for decades. It was a big job then, and that was before the several more-recent spin-offs and mergers. Of course, you do have a couple of tools that were not available back then, especially the Internet, which gives quick access to SEC filings and explanations by the company attorneys and investor relations departments. And you have Quicken which, when fed the proper information, does a good job of allocating the original basis among the shares still held. (But you'd better be sure to date your Quicken entries properly so that the split ratios, etc., are allocated among the correct number of shares for EACH transaction.)

One of the most valuable tools for me was Capital Changes Reports, a multi-volume (and expensive!) subscription service from CCH (Commerce Clearing House). This service, updated weekly, reported all changes in stocks of public companies. I'm not sure how far back the CCR started, but it went back at least into the 1930's. CCR was a significant part of the wall of black loose-leaf binders in my office, but I haven't looked at CCR in years; maybe it no longer exists. But if you know a CPA, a tax or probate attorney, a bank trust officer, or even a stockbroker, who has a strong tax library, you might see if they have a set of CCR that you can use for a few days.

If you knew that a client owned 100 shares of AT&T on January 1, 1940, for example, you could track that batch through the many evolutionary changes up to the present day. And if you knew the cost basis for those 100 original shares, you could calculate the basis for each of the shares owned today, in all the many present companies. Of course, CCR did not know how many whole and fractional shares might have been sold along the way, so you still had to find that information from the client's own records.

As to your specific questions, here are my best shots:

Yes and no, depending on how you define "screwing up results". You almost certainly will change the current bases that you already have so tediously calculated. But the end results should be more-accurate bases. And you may be surprised at how many future "re-dos" will be avoided by getting all transactions properly entered chronologically.

Yes. That is what you must do. And, as I just indicated, it might actually make the rest of the job easier, not harder. When the sequence of entries is correct, Quicken should get the right answer, even cascading through later transactions.

No. You will need to allocate basis at each step, between the original shares and the new spun-off company shares.

No. You can't properly calculate the gain on the sold shares OR the basis in the remaining shares, without properly recording the spin-off. After recording the spin-off and recalculating the bases, you can ignore any shares that were sold so long ago that those years can not now be audited or amended. No need to track further changes in those shares - unless they later spun-off even more companies whose shares must still be tracked. :>(

In looking up some recent transactions, Jay, I found some pages at the AT&T website that offer to shorten this big job in some cases. If you can say that SIL acquired 100 shares of SBC on 1/1/90 and never sold any of those shares or any shares spun off from those, then you may be able to look up the current composition of holdings from that lot.

At the risk of sounding morbid, I could suggest that she just hold ALL her shares until her death. At that time, her executor would have them appraised for probate purposes and those values would become their new bases in the hands of her estate and heirs. But, if she gives away some or all of the shares before her death, then the recipient will inherit the basis-tracking problems along with the shares. :>(

You have an interesting problem, Jay. These situations can be as fascinating as a game of Adventure ("You are in a maze of twisty little passages."), or as boring and tedious as trying to calculate Pi to a thousand decimal places.

RC

AAAAAAAAAAAAAARRRRRRRRRRRRRGGGGGGGGHHH !!!!!!!!!!!

Sorry. Had to get that off my chest.

Really, R.C., I deeply appreciate your stopping by and the insight you have provided. It confirms some of my worst fears (See AARRGGHH above.) as to extra work ahead, but if I wind up with a reasonably accurate history, it will be worth it for SIL.

You can bet I will hold aside backups fo the work-in-progress at each major change step so I can backtrack if necessary. I will also keep copious notes of what I am doing and why, as well as keeping a list of sources which I can footnote.

The list is already almost finished in the form of a spreadsheet, as I can then sort on dates, companies, stock IDs and the like. This should provide me a good view of the chronology of events and relationships among them.

Once I gain additional undertanding I will make the changes in the Quicken work done so far. Seems to be a good idea, also, to annotate evident results of changes (like deleting splits and backing out of spin-offs).

I think my wife and I are the executors, but would rather do the work now and enjoy SIL for as many years to come as possible.

Again, R.C., many thanks.

Jay .

Hi, Jay.

Understood!

In case you haven't already found it, this page should get you off to a good start: Cost Basis Guide for Stockholders

I understand this, too.

You're welcome. ;

Seems that after eliminating - in reverse chronological order - all splits in shares of AT&T and resulting Baby Bells, that Q has not done the math to "reconstitute" the original cost basis of earlier acquired shares.

Also, I got a couple of error messages (which I can't quote at this time - about being able to calculate number of shares correctly. I guess here that later posted sales or transfers of "large" number of shares - made possible by splits - got stranded when shares disappeared as I deleted splits.

Any suggestions before I barge ahead?

NOTE: I AM retired and can afford to reenter everything from scratch, but I am currently feeling boggled by the prospect. As I have backups of the "before deleting splits" file, I could always start a new file or accounts, enter the newly found early data mentioned in OP, move dividend reinvestment transactions piecemeal from old accounts/file to new, and interweave splits at the appropriate "chronological" moment.

Thanks

Jay .