Can I use the Corporate Action Wizard to enter spin-off transactions for manually entered transactional accounts?
You cannot use the spin-off wizard for manually created transactional accounts. However, you can use it for accounts imported through the Microsoft Excel - Transactions interface. If you have manually created a transactional account, you can establish a Microsoft Excel account mapping so that the Corporate Action Wizard can be used. A disadvantage is that you will not be able to reconcile these accounts as you can in the Import Blotter. Click here 
for steps on how to create a Microsoft Excel account mapping.
What if the spin-off I’m looking for isn’t listed on the Corp Action in My Practice page?
If you do not see the spin-off you are looking for on the Corp Action in My Practice page within the Corporate Action Warehouse, you can still use the Corporate Action Wizard and simply populate the information yourself.
What if information is missing from the spin-off wizard?
Morningstar populates the fields in the spin-off wizard based on the information in its database; sometimes a delay could exist between the time a spin-off takes place and when it is available in the Corporate Action Warehouse. If the spin-off data is not present in Morningstar Office when you go to import client data, you can search for the information on the Internet (or from your custodian) and populate the fields in the spin-off wizard yourself, or you can wait for the information to become available within Morningstar Office.
Here are a few helpful places to search for information on corporate actions.
Chicago Board Options Exchange - http://www.cboe.com/tradtool/contracts.aspx
Schwab Performance Technologies - https://schwabpt.com/resources/actions/
Cost Basis Tools - http://www.costbasistools.com/spin-off/calculator.php
You can also search on the merger company's Web site under Investor Relations.
Click here for a spreadsheet that can help you manually calculate the Cost Allocation percentages.
What should I do with the spin-off transactions if I decide to wait for the information to become available within the spin-off wizard?
If you decide not to continue with posting the spin-off transactions due to missing information, you should still export all transactions related to the spin-off into an Excel spreadsheet (for later reference), and then delete these transactions from Office.
When you reconcile this data, you will see out of balances related to the spin-off. These can be ignored and you can continue with the posting process. These items will remain out of balance until the spin-off is handled.
If you do not want to continue with the import process while having out of balances, you can delay posting your data until you are able to use the spin-off wizard and you have reconciled successfully.
What if the Cost Allocation for the new security in the spin-off wizard is different from what I find?
U.S. federal tax law does not specifically identify how the fair market values of spin-off shares should be determined, so several acceptable methods exist. They include using the following:
the closing trading price when issued on the distribution date
the opening trading price issued on the first trading date
the high-low average trading price issued on the first trading date, and
the closing trading price issued on the first trading date.
Morningstar uses the closing trading price issued on the first trading date for the cost allocation.
To calculate the Cost Allocation percentages for methods other than closing trading price, click here . Input the appropriate price in place of the end of day price.
Can I post my data if I haven’t completed the spin-off wizard, or if I have out-of-balance errors?
You can still post transactions with out-of-balance errors. The shares out of balance will remain out of balance until the correct transactions are generated to achieve the correct number of shares in the account.
What if Morningstar’s Effective Date is different from my custodian’s?
Morningstar uses the date the spin-off took place as the Effective Date for the corporate action. All generated transactions are given this date. Sometimes you will see a different date listed at the Custodian for these transactions due to processing differences. This field is editable within the spin-off wizard if you want to change it.
Note: The date of the spin-off transaction must correlate to the date that the price changed (increase/decrease). The price change date may differ depending on whether Morningstar pricing or imported pricing is being used.
What if this Corporate Action affects multiple accounts and I don’t want to enter the Cash-in-Lieu amount individually for each account later?
The price needed for the Cash-in-Lieu field in the spin-off wizard can be calculated using the following steps:
Pick the account with the largest number of shares that received a Cash-in-Lieu transaction.
Multiply the original number of shares times the share distribution ratio. This results in the total number of shares for the new security.
Use the amount from the Cash-in-Lieu transaction and divide by the fractional share from the new security (be sure to use the entire number after the decimal place).
Enter this price in as the Cash-in-Lieu Price. Be sure to use all of the trailing decimal places.
You will need to verify the transactions afterwards for accuracy. Be sure the Net Amount and Gross Amount fields for the transactions have only two digits after the decimal, as this could affect your Cash balance. This can be done by clicking in these fields; any additional digits beyond the decimal will be displayed.
Why are the prices on the Credit of Security transactions different from the end of business day price on the day of the transaction?
The Debit of Security transaction for the original security uses the end of business day price. The amount of the original security is then multiplied by the New Cost Allocation% for the original security. This determines the amount of the Credit of Security transaction(s). This value should then be divided by the number of shares to determine the price. This is done for the new security as well.
What if I have a Cash Out of Balance for more than the Cash-in-Lieu amount?
This usually means the Cash-in-Lieu has been accounted for twice. You generated a Sell transaction for the fractional share using the spin-off wizard, but the custodian also recorded a Cash-in-Lieu transaction. The custodian usually sends this transaction as a Distribution for the new security, or a Deposit into Cash. (Example: Fidelity sends the Cash-in-Lieu as an out of pocket deposit. TDA and Schwab send them as distributions.) If you have not posted this transaction, go to the Transactions blotter, and look for the transaction sent from the custodian. Note: You can sort the Account Number column by double-clicking on that column header, or you can search by account number using the Search for functionality at the top left of the screen.
Delete the Cash-in-Lieu transaction. If it shows as a Distribution, delete that item. (Morningstar automatically deletes the offsetting Cash transaction.)
If the transaction came in as a Deposit into Cash, verify that the transaction is not linked to any other transaction by ensuring the Offsetting Cash Security field is blank, and then delete it. Be sure not to delete any Money Market transactions.
What if I am not concerned with cost basis, or do not have accurate cost basis on my original security, do I need to use the wizard?
It is still recommend to use the spin-off wizard, but you can choose instead to generate the transactions manually.
If you elect not to enter these transactions manually, the total portfolio performance should remain the same, but the individual security performance will not be accurate.
Note the following important points:
If you enter these transactions manually, use a Credit of Security transaction to bring in the shares of the spun-off security.
If the custodian sends a spin-off transaction without a transaction type, click in the Transaction Type field, and select Credit of Security.
To handle the Cash-in-Lieu correctly, as opposed to using the Distribution or Deposit into Cash that is sent from the Custodian, credit in the fractional share, then sell the fractional share for the Cash-in-Lieu amount.
The spin-off wizard debits out the original shares and credits these shares back, as well as crediting in the new shares. These credit amounts are based on the Cost Allocation entered; the total debit amount of the original holding ends up equaling the sum of the two credit transactions. This eliminates any Inconsistent Data Warning Message when running performance reporting because the debits and credits net, as well as properly calculating the individual security performance.
See Also
Determining the Spin-off Cost Basis
How to Create a Microsoft Excel Client/Account Mapping for Manual Accounts