PA language Valuation Date Member Payments
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PA language Valuation Date Member Payments To clarify my question, I am looking for partnership agreement language as it relates to the "valuation date of member payments", NOT the valuation of the club portfolio. This is something I discovered for the first time in many years when doing the audit this year. Per Bivio's "Member Payments" screen (which the treasurer uses to enter member payments), 2 dates are entered by the treasurer: the "Transaction Date" and the "Member Valuation Date". "Member Valuation Date. Clubs typically choose one day per month as their Valuation Date, the date to convert member payments into club units. We have carried over this traditional approach, because it is what any clubs are familiar with. Since Bivio values your portfolio on a daily basis, your club could choose to convert payments on the date they are deposited. Your partnership agreement or bylaws should state which valuation method you use and if you choose monthly valuations, on which business day the valuation occurs." Hope this clarifies my question. Carla Hanson MDI Investment Club Janesville WI
our club has always used the day prior to the meeting. Note, bivio uses end of day pricing.
Bob
Lunch money investment club
Our bylaws stipulate the following: A. TIME OF PAYMENT: A withdrawal or death of a partner shall be noted and/or accepted by the Club at the next regularly scheduled meeting. The withdrawing partner's capital account shall be valued at the close of the market on the day following the acceptance of the withdrawal (death) by the Club. The withdrawing partner's interest shall be paid to her (or to the partner's estate) within 60 days after the valuation of the account, or as soon as practicable, whichever occurs earliest. Val Sewell, Finger Lakes Investment Club
This is from our Partnership LLC agreement: "The number of units of ownership received for a member payment will be determined by the club's NAV as of the deposit date of the contribution in the club brokerage account (Payment Valuation Date)" As pointed out by others, assuming you have autosync with Schwab (maybe other brokerages work the same). 1. The payment autosync 'transaction date' in Bivio and the "valuation date" in Bivio aren't always the same, for reasons I don't know. I always adjust the "valuation "date to the "transaction date" which, per our LLC, as just quoted, is required to be the deposit date into the brokerage account. 2. We are incorporated in NH. NH regulations allow considerable flexibility as to how to set the valuation date of member payments. Our club believes, in an analogy to buying a publicly traded security, that the most equitable date for valuing the payment is the day the payment is deposited at the brokerage, which is done either by members depositing direct with Schwab (EFT, mailed check) or in cases that someone gives me a check at a meeting, by me doing same day remote deposit via my mobile phone. Hope that answers your question and that the above LLC language helps. Gary Henricksen Treasurer Keene Horizons Investment Club LLC
Thank you, Gary. This is the language I am looking for. Margaret Wentworth and Lynda Feit, I think I understand your replies. Would you be willing to share the exact wording in your partnership agreements? Again, Bivio has recommended language for the valuation date of members' monthly payments should be in our partnership agreements. Thanks for everyone's help. Carla
On Tuesday, May 13, 2025 at 06:44:21 AM CDT, Gary Henricksen via bivio.com <user*32968100001@bivio.com> wrote:
This is from our Partnership LLC agreement: "The number of units of ownership received for a member payment will be determined by the club's NAV as of the deposit date of the contribution in the club brokerage account (Payment Valuation Date)" As pointed out by others, assuming you have autosync with Schwab (maybe other brokerages work the same). 1. The payment autosync 'transaction date' in Bivio and the "valuation date" in Bivio aren't always the same, for reasons I don't know. I always adjust the "valuation "date to the "transaction date" which, per our LLC, as just quoted, is required to be the deposit date into the brokerage account. 2. We are incorporated in NH. NH regulations allow considerable flexibility as to how to set the valuation date of member payments. Our club believes, in an analogy to buying a publicly traded security, that the most equitable date for valuing the payment is the day the payment is deposited at the brokerage, which is done either by members depositing direct with Schwab (EFT, mailed check) or in cases that someone gives me a check at a meeting, by me doing same day remote deposit via my mobile phone. Hope that answers your question and that the above LLC language helps. Gary Henricksen Treasurer Keene Horizons Investment Club LLC
This is from our Partnership Agreement. 8. Valuation: The current value of the assets and property of the Partnership, less the current value of the debts and liabilities of the Partnership (hereinafter referred to as the "value of the partnership") shall be determined as of the last day of the month (hereinafter referred to as the "valuation date"). I prefer the idea that members are all paying the same price for units each month. That's why we use the last valuation date (which is the last day of the month) as the members valuation date on contribution. Rather than some people attempting to time the market for their contributions. We are all about fairness. We are attempting to change how we do the bookkeeping, by crediting all contributions on the last day of the month which would be the last valuation day. This way all the income and expenses for the month would be applied to everyone in the proportion to the percentage of their capital account for the month. Rather than having staggering proportions of income and expenses applied to each member according to the date of their contributions. Obviously, each club has their own perspective of how valuations should be handled. There is no right or wrong way to set up a valuation date or how you credit or value payments as long as it is allowed by IRS guidelines. Happy investing. Debi Thorne |
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