Friday, October 7, 2011

Portfolio Update -- Correction

Double Entry accounting is one of the greatest invention of mankind. It's a great way of recording transactions and can detect our slightest mistakes, up to decimal points.

I felt very strange when I looked at my earlier scorecard. How come my book value was 50 k but but my portfolio gain was only 3 k plus. It's either I overstated my assets or I under-recorded my investment gains. Tried to trace my records but finally gave up. I resorted to rebuild the whole portfolio from ground up by using old fashion way -- Double Entry. Finally got the book balanced. See this trial balance. A lot of works but worth it. Very satisfied now.

Since it's only involving a few simple accounts, I can do it with Excel. If I can get accounting software will be great but I think it's quite costly.

Never I anticipated this simple tracking has evolved into more and more complex as time grow. Not sure how my cash was overstated by almost 7k. Luckily the rest of the stuffs were correct. My cash now stood at 33 k.

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