Schedule D and Schedule H

[Guest pensionbrainwashed]

Our office completes the Schedule H or I using an accrual method. However, the report we use to complete the Schedule D is on a cash method. Therefore, the totals are different. Should we be using the same accounting method on both forms?

[401(k)guru]

I have a feeling that you may be putting your accruals on the wrong line on the Schedule H. For example, let's assume that you have a CCT with a year-end cash basis value of $100 and income accrual of $5 for a total accrued value of $105. I have always placed the $5 on line 1(b)(3) and the $100 on line 1©(9) for a total asset value of $105. On the Schedule D, I would put $100 as an investment in a CCT.

If the Schedule D does not match the Schedule H for the total of CCT, Master Trust, 103-12, etc. I have found that you will get an inquiry letter.

Hope that helps.

[JanetM]

I do it the same way, using the receivable and payable lines to include the accruals. Makes it easier whne you roll the trial balance forward, all the numbers stay in sync with the 5500.