Book cost calculations for Fund convertions

Hi All,

We've been trying to Ascertain the book costs of a clients investments which were re-registered onto a platform (before we took over). Having done so, the platform has now automatically converted the funds from 'dirty' to 'clean' classes.

As a result, the number of units in the fund has changed.

We're looking to sell down within the client's CGT limits to phase the investments into our propositions as they do not want to face a tax charge.

I'm assuming that the book cost will remain the same as it's only a conversion and that the only thing that will have changed is the book cost per unit (as there are now more units in the clean fund).

Say that a fund has a total book cost of £10,000 and there were 100 units purchased originally. This would mean that each unit would have a book cost of £100. (Lets ignore dividends/sales/buys/assume sales over 30 days old for this example).

If after a conversion the number of new units was 1,000, does this mean the book cost per unit would now be £10?

Am I correct with the above reasoning?


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