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Recording the Jupiter Mines – Juno Minerals demerger

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On the 7th of May 2021, there was a demerger involving Jupiter Mines Limited and Juno Minerals Limited.

Unlike other demergers, no Class Ruling has been issued by the ATO in relation to this transaction.

Under the demerger, the Jupiter Mines shareholder have received an allotment of Juno Mineral shares based on 1 Juno share for every 16.325 Jupiter shares.

This was paid for via:

• a franked dividend of 0.17 cents per share
• a return of capital of 1.36 cents per share

It should be noted that no money was paid to the shareholders from the return of capital and franked dividends.

What a Mclowd user needs to do is as follows:

1. Record the Return of capital for the Jupiter shares
2. Record the franked dividend
3. Record the purchase of the Juno shares which equals the total of the return of capital and dividend.

How to Record in Mclowd

NOTE: You will need to record all the parts of the transaction against one of the fund’s bank accounts even though no money was ever paid into that bank. If you record all parts of the transaction correctly, then the bank account will still balance.
We will use the following example to show you have to record this transaction.

The Fund has 20,000 Jupiter shares which cost $8009.95.

On the 7th of May 2021, the fund received 1225 Juno shares (based on 1 Juno share for every 16.325 Jupiter shares.

To pay for these shares, the fund received a total payment of 1.53 cents per Jupiter share. This includes a return of capital of 1.36 cents and a franked dividend of 0.17 cents.

As can seen below, this equals a return of capital of $272 and a franked dividend of $34.  Therefore, the 1225 Juno shares cost $306.

1. Record the return of capital amount for the Jupiter shares

To record the Return of Capital, choose Assets then choose Corporate Actions

On the Corporate Actions screen, choose Return of Capital

On the Return of Capital screen, please record the record of capital as detailed in the following screen shot.

You should record the following

  • Record Date of 7/5/21
  • Asset of Jupiter Mines
  • Posting date of 7/5/21
  • Received amount for return of capital recorded on the Jupiter Mines Distribution Statement (in our example it is $272)
  • Select a fund bank account.
  • Check the figures to make sure they are correct as you CANNOT reverse a return of capital
  • Choose SAVE
  • Choose OK when asked to confirm

2.     Record the Franked Dividend

To record the Franked Dividend, choose Income then Add Asset Income from the Menu.

Complete the Add New Income screen for Jupiter Mines.

You should record the following

  • Select Account – Fund or individual member
  • Asset of Jupiter Mines
  • Choose the same bank account you used for Return of Capital
  • Enter Date of 7/5/21
  • Can enter description of “demerger dividend”
  • Unfranked dividend of 0
  • Franked dividend as recorded on the Jupiter Mines Distribution Statement
  • Choose SAVE

3.     Record the purchase of Juno shares (JNO)

To record the purchase of Juno shares, choose Assets then Add Asset from the Menu

On the Add New Asset screen, you need to record the purchase of the Juno shares.

You should record the following

  • Choose Member Account – Fund or individual member
  • Choose Asset class of Direct Equities
  • Choose New Holding and New Parcel
  • Type in JNO as Stock Code
  • Choose the same bank account you used for Return of Capital and the Franked dividend
  • Enter Date of 7/5/21
  • Enter number of Juno shares allotted (in this example it is $1,225)
  • Enter share cost which is the Total amount on the Jupiter Mines Distribution Statement
  • Enter Brokerage of 0
  • Choose SAVE ASSET