How to compile accounting entries for purchasing private equity funds?
1. When purchasing, relevant accounting entries are compiled as follows:
Debit: Transactional Financial Assets-Cost
Loans: bank deposits
Other monetary funds, etc.
2. If the purchased fund is sold again in the next year, the following relevant accounting entries shall be made according to the difference between the net fund value and the purchase cost at the end of the year:
Debit: Trading financial assets-changes in fair value
Credit: gains and losses from changes in fair value
Note: The above is the situation of appreciation. If it is depreciation, the opposite accounting entry should be made.
3. At the time of sales, relevant accounting entries are compiled as follows:
Debit: bank deposit
Loan: Transactional Financial Assets-Cost
Transactional financial assets-changes in fair value
Transactional financial assets-investment income
What are transactional financial assets?
Transactional financial assets mainly refer to financial assets held by enterprises for sale in the near future. Financial assets that meet one of the following conditions should be classified as trading financial assets: (1) The purpose of obtaining financial assets is mainly to sell, buy back and redeem in the near future. (2) It is a part of the identifiable financial instrument portfolio under centralized management, and there is objective evidence that the enterprise recently managed the portfolio through short-term profit. (3) It belongs to financial derivatives. However, derivatives designated as effective hedging instruments by enterprises belong to financial guarantee contract derivatives, except those linked to equity instrument investments that are not quoted in an active market and whose fair value cannot be reliably measured and must be settled through delivery of equity instruments.