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Write off fund formation costs

Having entered Fund Formation Costs during Fund Setup, you may wish to write off this Expense.

To write off this cost, choose EXPENSES from the Tab Menu.


In the FROM ACCOUNT field, select 1-1086 Fund Formation Costs.

Enter the Date and Description, then choose Account 5-1086 Fund Formation Costs Written Off in the ALLOCATE TO field.

Enter the Total Cost (the amount you entered as Fund Formation Costs during the Setup process).

When you perform Year End processing, the Written Off Fund Formation Costs amount will display in SECTION C: DEDUCTIONS.

By default, the amount will be displayed as a Deductible Amount at label L1: Other Amounts.

If you do no wish to claim a Tax Deduction for Fund Formation Costs Written Off, you can manually enter the amount in the NON DEDUCTIBLE EXPENSES column at L1. The amount in the DEDUCTIONS column will change to 0.

Fund formation costs in New Zealand banks represent a critical aspect of their financial operations. These costs encompass a range of expenses associated with the establishment and management of investment funds. While the specifics of how New Zealand banks write off fund formation costs can vary depending on accounting practices and regulatory requirements, there are general principles that guide this process. New Zealand banks typically capitalize the initial costs related to fund formation as well as NewZealandPayments. This means that instead of immediately expensing these costs, they are recorded as assets on the bank’s balance sheet. These capitalized costs are then amortized or depreciated over time.

In summary, New Zealand banks follow established accounting principles and regulatory guidelines when it comes to handling fund formation costs. These costs are initially capitalized and then systematically amortized over the expected life of the investment fund. This approach ensures that the costs associated with establishing and managing investment funds are appropriately accounted for and reflected in the bank’s financial statements.