A Most Strange and Complicated Reorganization

Laurie Frederiksen on

Hi All,

It appears that companies this year made a point of creating different and unusual reorganizations that unfortunately have impacted stocks a lot of you own.

One of these was the purchase of EMC by Dell. The tax treatment on this one is something we've never had to handle before and the information from some of your brokers that I've seen so far shows that there were many and varied ways that they implemented it when it happened.

If any of you owned EMC and received cash and DVMT shares in the merger, we'd really like to see a copy of your 1099 form when you get it so we can understand better what we're going to have to match up to on your club tax forms.

If you'd like to share, please download and send a copy of your 1099 when you get it to support@bivio.com (Not to this list).

Thank you in advance.

Laurie Frederiksen
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Joe Farrell on

1. Each treasurer should understand the limitations of our accounting package.

2. Each treasurer should thoroughly read the documents that identify the structure of any merger, spin-off or spin-out before it occurs.

3. Each treasurer should report to his/her club the accounting difficulties that will be encountered when the merger occurs and be prepared to make a sale/hold recommendation based on his/her analysis.

4. We sold EMC before the transaction was consummated because we did not want the problems now being encountered.

5. Those hard-headed members in my clubs that want to hold on because they will not be impacted by the work involved have implicitly volunteered to become the replacement treasurer(s) when I resign.

On Jan 31, 2017, at 10:08 AM, Laurie Frederiksen <laurie@bivio.biz> wrote:

It appears that companies this year made a point of creating different and unusual reorganizations that unfortunately have impacted stocks a lot of you own.
One of these was the purchase of EMC by Dell.

Laurie Frederiksen on

You make very very good points Joe though this particular one has even caught the brokers unaware and confused.

Unfortunately that leaves us up in the air trying to determine how they are going to decide to report things and what we're going to need to try and match.

One of the most valuable features you get from bivio is help making the entries you need to record these things. As you can see from this page, there are many many reorganizations of different types that we've handled for clubs in past years. This page give you an idea of some of the ones that have created questions for clubs:

Reorganizations

Leonard E. Douglass on

I notice that Folio has recorded the spin off of BIVV from
BIIB in our Investment Club account but Bivio has not
recognized it. Folio processed it on Feb 7th, and The last
entry in our Transactions iat Bivio is listed on Feb 6th.
Are there issues we should be aware of? I see it is in the
list of transactions and noted preliminary.

Thanks Len Douglass, Financial partner SEMICH NAIC Model
Club

Laurie Frederiksen on

Hi Len,

This is a regular spinoff that can be entered using the spinoff button on the Accounting>Investments page. The effective date is 2/2/2017. You received 1 share of BIVV for every 2 of BIIB that you owned.

Folio is currently using 92.189% as the remaining basis percentage.

The company has not released guidance on this yet so that may change but for now, it will allow you to make the entry you are missing and agree with what they currently show.

On Mon, Feb 13, 2017 at 5:38 PM, Leonard E. Douglass <pbco@comcast.net> wrote:

I notice that Folio has recorded the spin off of BIVV from
BIIB in our Investment Club account but Bivio has not
recognized it. Folio processed it on Feb 7th, and The last
entry in our Transactions iat Bivio is listed on Feb 6th.
Are there issues we should be aware of? I see it is in the
list of transactions and noted preliminary.

Thanks Len Douglass, Financial partner SEMICH NAIC Model
Club

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