This step distributes the income and expenses from unsegregated assets of the fund to members based on the Members’ Weighted Average (MWA) balances.
To enable you to correctly calculate tax liabilities for various members and correct profit distribution among members, Mclowd will calculate Member Weighted Averages and compose a Member Weighted Average (MWA) Report.
NOTE: You can manually override the % allocations calculated by Mclowd, if necessary, in both the Net Profit and Loss Allocation to Member Accounts and the Allocate Income Tax screens. Simply type your values in the Override field before pressing the ALLOCATE button.
NOTE: The calculated MWA percentage can be overridden if an alternative method of distribution is to be used. Simply type a new percentage into the Override column. The Total of percentages for all members must equal 100%. If you make an error when Overriding, click the RESET button to reset to Mclowd’s calculated values.
Your MWA report will list (and factor into the calculation) all segregated transactions, including member contributions, roll-ins, segregated income, and segregated expenses (e.g. insurance).
By considering segregated transactions, and the number of days in the financial year for which the respective income or expense increased or reduced the Fund’s asset balance, Mclowd calculates the percentage of the Fund that rightly attributes to each member. This calculation is useful for assessing tax obligations where some members are in Pension phase (and their income is tax exempt) and some members are in Accumulation phase (and income in taxed). These percentages are also used to calculate the percentage of annual profit/loss to attribute to each respective member.
The information in the MWA Report will assist an actuary to provide the Actuarial Report needed to claim income tax exemption for members in Pension Phase. If your Actuary makes adjustments to the percentages calculated by Mclowd, you can manually override the percentages shown when Mclowd allocates Tax and Profit, by typing new values into the Override fields.
Return to the Net Profit and Loss Allocation screen after checking the MWA report and accept or override the percentage values shown for each member account. Once the MWA % is accepted or overridden, click ALLOCATE P&L.
The user will then see the following message and should click OK to proceed.
When you click OK, Mclowd will take you back to the Net Profit and Loss Allocation to Member Accounts screen and should display the following screen.
Mclowd offers options to EXPORT TO EXCEL, PRINT or DOWNLOAD AS PDF.
Click the NEXT – ALLOCATE CONTRIBUTIONS TAX button in the lower right corner of the screen to move to the next step.