wanderbooks/bookspec/examples/p3-party-distribution-still-owed.toml

# P3 defect 24 in a member's entry (found in review, 2026-10-21): a
# distribution declared to a liability that isn't money counted as paid
# when declared and again when paid. A distribution's cash is the money it
# paid, its in kind the property it gave; the rest is still owed. Regression
# tests: ledger-core tests/spec_party_totals.rs
# defect24_a_distribution_declared_to_a_payable_counts_once_when_paid and
# a_distribution_of_money_and_depreciated_property_splits_by_what_moved.
# The shape: bookspec/README.md.

id = "p3-party-distribution-still-owed"
title = "A distribution counts the money it paid and the property it gave; what is still owed counts when paid"
rule = """
An entry naming only members that moves their capital counts what moved
it. Of a distribution, the cash is the money it paid (through the cash
accounts, a card, the members' financing or a loan), the in kind the
property it gave up (at what the books carried it), and the rest, credited
to a liability that isn't money for the entry (distributions payable, or
what the members are owed when they are named its creditors), is a
promise: it counts nothing until it is paid, then once, as paid. The
statement of members' equity counts a distribution when it is declared,
so party totals catch up with it when it is paid.
"""
status = "AUTHORITY"
sources = [
  "Helvering v. Price, 309 U.S. 409, 412-413 (1940): a promise to pay is not payment (wanderbooks docs/spec/sources/helvering-v-price-1940.md)",
  "Treas. Reg. §1.704-1(b)(2)(iv)(b)(4)-(5): a partner's capital account falls by the money and the property distributed (docs/spec/sources/irs-capital-accounts.md)",
  "DECISION (owner, 2026-10-20): a member's entry counts what moved their capital; money is cash, cards, the members' financing and loans (rules.md B-35)",
]
tags = ["parties", "members", "distributions", "promises", "in-kind", "money"]

[setup]
currency = "USD"
fiscal_year_start = "01-01"
basis = "accrual"
rounding = "half-even"
cash_accounts = ["1000"]

[[setup.accounts]]
code = "1000"
name = "Checking"
type = "asset"

[[setup.accounts]]
code = "1500"
name = "Equipment"
type = "asset"

[[setup.accounts]]
code = "1510"
name = "Accumulated Depreciation — Equipment"
type = "asset"

[[setup.accounts]]
code = "2150"
name = "Distributions Payable"
type = "liability"

[[setup.accounts]]
code = "3000"
name = "Capital — Tobin Harlow"
type = "equity"

[[setup.accounts]]
code = "3001"
name = "Capital — Morgan Ellis"
type = "equity"

[[setup.accounts]]
code = "3100"
name = "Distributions — Tobin Harlow"
type = "equity"

[[setup.parties]]
name = "Tobin Harlow"
roles = ["member"]

[[setup.parties]]
name = "Morgan Ellis"
roles = ["member"]

[[setup.members]]
name = "Tobin Harlow"
share = "0.5"
capital_account = "3000"
distributions_account = "3100"

[[setup.members]]
name = "Morgan Ellis"
share = "0.5"
capital_account = "3001"

# 1. A distribution declared to Tobin: still owed, counts nothing.
[[events]]
date = "2026-06-30"
description = "Distribution declared"
parties = [{ party = "Tobin Harlow" }]
lines = [
  { account = "3100", side = "debit", amount = "200.00" },
  { account = "2150", side = "credit", amount = "200.00" },
]

# 2. It is paid: paid, money, once.
[[events]]
date = "2026-07-15"
description = "Distribution paid"
parties = [{ party = "Tobin Harlow" }]
lines = [
  { account = "2150", side = "debit", amount = "200.00" },
  { account = "1000", side = "credit", amount = "200.00" },
]

# 3. Declared and partly paid at once: the money now, the rest when paid.
[[events]]
date = "2026-08-31"
description = "Distribution, part paid"
parties = [{ party = "Tobin Harlow" }]
lines = [
  { account = "3100", side = "debit", amount = "300.00" },
  { account = "1000", side = "credit", amount = "100.00" },
  { account = "2150", side = "credit", amount = "200.00" },
]

# 4. Equipment carried at 1,000.00 less 300.00 depreciated, with 100.00 in
# cash, distributed to Morgan: 100.00 cash, 700.00 in kind.
[[events]]
date = "2026-09-01"
description = "Equipment and cash distributed"
parties = [{ party = "Morgan Ellis" }]
lines = [
  { account = "3001", side = "debit", amount = "800.00" },
  { account = "1510", side = "debit", amount = "300.00" },
  { account = "1500", side = "credit", amount = "1000.00" },
  { account = "1000", side = "credit", amount = "100.00" },
]

[[expect]]
query = "party_part"
entry = 1
party = "Tobin Harlow"
values = { resolved = "200.00", direction = "neither", cash = "0.00", in_kind = "0.00" }

[[expect]]
query = "party_part"
entry = 3
party = "Tobin Harlow"
values = { resolved = "300.00", direction = "paid", cash = "100.00", in_kind = "0.00" }

[[expect]]
query = "party_part"
entry = 4
party = "Morgan Ellis"
values = { resolved = "800.00", direction = "paid", cash = "100.00", in_kind = "700.00" }

# Before the review: 700.00 (event 1's 200.00 and the 200.00 still owed
# on event 3 counted as paid, and event 2 paid the first again).
[[expect]]
query = "party_totals"
party = "Tobin Harlow"
basis = "cash"
from = "2026-01-01"
to = "2026-12-31"
values = { paid = "300.00", received = "0.00" }

# Through June: declared, not yet paid. The statement counts it already.
[[expect]]
query = "party_totals"
party = "Tobin Harlow"
basis = "all"
from = "2026-01-01"
to = "2026-06-30"
values = { paid = "0.00", received = "0.00" }

[[expect]]
query = "members_equity"
from = "2026-01-01"
to = "2026-06-30"
values = { "Tobin Harlow.contributions" = "0.00", "Tobin Harlow.distributions" = "200.00" }

# Before the review: 0.00 cash, 800.00 in kind.
[[expect]]
query = "party_totals"
party = "Morgan Ellis"
basis = "cash"
from = "2026-01-01"
to = "2026-12-31"
values = { paid = "100.00", received = "0.00" }

[[expect]]
query = "party_totals"
party = "Morgan Ellis"
basis = "all"
from = "2026-01-01"
to = "2026-12-31"
values = { paid = "800.00", received = "0.00" }

[[expect]]
query = "members_equity"
from = "2026-01-01"
to = "2026-12-31"
values = { "Morgan Ellis.contributions" = "0.00", "Morgan Ellis.distributions" = "800.00" }