Money 3.0: How To Track Employer-Offered Stock Options
  
PSS ID Number: Q155171
Article last modified on 07-14-1997
 
3.0
 
WINDOWS
 

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3.0
WINDOWS
kbhowto
 
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The information in this article applies to:
 
 - Microsoft Money versions 3.0, 3.0a
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SUMMARY
=======
 
It is possible to track employer-offered stock options by setting up
separate investment accounts for each grant.
 
MORE INFORMATION
================
 
To track Employer-Offered stock options, do the following:
 
   1. Make sure you have all your option records available.
 
   2. On the Window menu, click Investment Details.
 
   3. On the Lists menu, click Investment Account List, and then
      click the New button
 
   4. Fill in the fields on the screen, giving the account a
      descriptive name, such as such as "Options at $20", where $20 is
      the grant price. Including the grant price will make it easier to
      track options granted at different prices. Click Continue.
 
   5. When asked if the account has an Associated Cash Account, click
      Yes, and then click OK.
 
   6. Leave the Opening Balance blank in the next dialog box. Click
      OK, then click Close.
 
   7. On the Inv Acct menu (ALT+A), click the name of your new
      account.
 
   6. Enter a new Buy transaction, using the table below as a guide.
 
      Field           What to Enter
      -----           -------------
      Date            The date you were awarded the options
      Investment      The name of the stock
      Activity        Buy
      Quantity        The number of shares in the option grant
      Price           The per-share grant price of the options
      Total           Leave this blank. The total will be calculated
                      automatically.
      Memo            Enter a comment here. You might enter the date
                      the shares vest.
      Commission      Zero
      Transfer from   Your Associated Cash Account
 
   7. Click ENTER.
 
   8. If you have multiple stock options, repeat steps 6
      through 7 for each grant.
 
Initially, the Associated Cash Account's balance will have a value equal to
the negative of the option's value, and the account value will be zero. The
Associated Cash Account's balance now represents the amount you would have
to pay to exercise the options and, therefore, is not part of the total
value of the grant.
 
Tips to Track Vested Options
----------------------------
 
If you want to track only the value of shares that have vested, type only
the number of vested shares in the Quantity field when you enter the Buy
activity for the stock grant. In the Memo field, type the number of
unvested shares for reference.
 
When additional shares vest, increase the number of shares in the Quantity
field of the original Buy transaction, and subtract the corresponding
number from the Memo field.
 
If you want the value of your options to be reflected in your Net Worth and
investment reports, include in your reports only options accounts which
have a positive value. If the stock has declined in value since you were
granted it, the option account will show a negative balance.
 
To Exercise Stock Options
-------------------------
 
When exercising options, you can either sell the stock as soon as you
purchase it, or keep the stock you purchase. Follow the appropriate
procedure to track your options:
 
Selling The Option Stock
------------------------
 
You must record the sale, and "reimburse" your records to account for the
exercise price.
 
   1. Make sure you have all your option granting and sale records
      available.
 
   2. On the Window menu, click Investment Details.
 
   3. From the Inv Acct menu (ALT+A), click the name of your new
      account.
 
   4. Enter a Sell transaction, using the table below as a guide.
 
      Field            What to Enter
      -----            -------------
      Date             The date of the sale
      Investment       The name of the stock
      Activity         Sell
      Quantity         The number of shares exercised
      Price            The per-share sale price
      Total            Leave this blank. The total will be calculated
                       automatically.
      Memo             Enter a comment here.
      Commission       Zero
      Transfer to      Select the account in which you deposited the
                       money from the sale.
 
   3. The account to which you transferred the sale proceeds will now
      contain the complete amount from the sale. To subtract the exercise
      amount, figure the amount of cash you spent to exercise the
      options. This may be recorded on your statement, but you could also
      calculate it by multiplying the quantity of shares times the grant
      price.
 
   4. Open the Account Forms window, and go to the account where you
      deposited the sale's proceeds. Enter a transfer to the Associated
      Cash Account, using the following table as a guide.
 
      Field          What to Enter
      -----          -------------
      Num (#)        Leave this blank
      From           The account that received the proceeds of the sale
      Date           The date of the sale
      To             The name of the Associated Cash Account
      Amount ($)     The quantity of shares sold times the grant price
      Pay to         Leave this blank
      Memo           Enter a comment here
 
Keeping The Option Stock
------------------------
 
You must move the stock from your option account to another Money account
used to track stock you own.
 
   1. Make sure you have all your option records handy.
 
   2. In Investment Details, go to your options account, and enter a
      Sell transaction in your options account for the number of shares
      you exercised, choosing the Associated Cash Account for the
      transfer account. The price for the sell should be the exercise
      price.
 
   3. Go to the account where you want to keep the options, and enter a
      Buy transaction using the exercise price. Choose the Associated
      Cash Account as the transfer account.
 
KBCategory: kbusage kbhowto
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Additional reference words: w_money investments
3.0
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Keywords            : kbhowto kbusage
Version             : 3.0
Platform            : WINDOWS
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Copyright Microsoft Corporation 1997.