BGL do not provide accounting or taxation advice. The following is designed to act as a guide for Simple Fund 360 users. It is not designed to be accounting or tax advice and should not be taken as a strict guideline. Other methods that are more suitable may be used instead of these steps.
National Australia Bank Limited (NAB) has exited its investment in CYBG Group (CYB) by demerging 75% of the CYB shares to NAB shareholders.
NAB shareholders are entitled to one CYB security for every four NAB shares they held as at the Scheme Record Date (05 February 2016).
The number of NAB shares held does not change as a result of the demerger.
For more information refer to the following:
The fund has 2,000 NAB shares.
|Date Purchased||Number of Shares||Cost|
The fund is entitled to receive 500 (2000 / 4) CYB securities under the Demerger.
If the number of units is not a whole number, the number needs to be rounded down to the nearest whole number - See CR 2016/13 Point 21.
Aggregate Value of the 500 CYB securities
= 500 CYB securities X $4.01 (market value) = $2,005 (See CR 2016/13 Point 37-38)
Reduction amount for the NAB shares = $2,005 or $1.0025/share (See CR 2016/13 Point 21)
- Go to Investments | Corporate Actions.
- From the Corporate Actions screen, locate the NAB demerger.
- Select Process under the Action column.
- Simple Fund 360 will automatically select the details required under Step One.
- Under Step Two, you will need to review and input the corporate action details. Simple Fund 360 will automatically auto-fill some information. If you already have CYB shares, Simple Fund 360 will automatically select that security. If this security does not exist in the fund, select Add New Investment for Simple Fund 360 to create that investment.
- By default, Demerger will be automatically selected, which means that the new investment will have a contract date as the demerger action date.
- Input the number of units in Head and Demerged Security.
- By default, the $ amount will be selected for cost base treatment.
Input the Demerged Security Cost Per Unit.
Note: Capital gain can be triggered if any parcel in the head security has a cost base of less than the Demerged Security Cost Per Unit.
- Review the Corporate Action Summary under Step Three.
- Select Process Corporate Action to post the transactions.
- The Corporate Action will now be marked as Processed under Status.
- Click View to see the details of the corporate action transactions.
- Please check your investment report to ensure that the number of units and cost of the investments are correct.