The most common reason a scheduled dividend or income distribution does not occur is that the corporation, business, or trust does not have sufficient cash available to make the payment.
In Voyant, these entities are modelled as separate cash flow entities. Before they can distribute income to beneficiaries or owners, they must first receive funding through income, business profits, asset sales, or contributions.
1. Check that the entity has been funded
Corporations, businesses, and many trusts do not generate cash automatically. Before they can pay dividends or make income distributions, they must have sufficient cash or assets available.
If you've scheduled a dividend or income distribution but haven't modelled any funding for the entity, there will be no funds available to distribute.
For a business or corporation, funding may come from:
- Business income or profits
- Contributions from the owners
- Proceeds from the sale of business assets
- Other planned cash inflows
For a trust, funding can be modelled in one of two ways:
- Create the assets with the trust as the owner, if the trust already owns those assets at the start of the plan.
- Model a transfer of existing assets from an individual or another owner into the trust during the plan.
If the trust has not been funded using one of these methods, it will not have assets available to generate income or make distributions to beneficiaries.
2. Review the entity's cash flow
If the entity has been funded, review its cash flow to determine whether sufficient cash is available in the year the distribution is scheduled.
Previous expenses, distributions, or other withdrawals may have reduced the available balance before the scheduled payment occurs.
To review this, you can go to the Trust or Businesses chart and select Year View > Investments
3. Confirm the distribution is scheduled correctly
Review the scheduled dividend or income distribution to ensure:
- The start year is correct.
- The payment has not ended.
- The payment amount is appropriate and is not greater than the cash available in the entity.
- The payment is associated with the correct corporation, business, or trust.
Additional resources
For more information about modelling business cash flow, see:
For information about funding charitable trusts before distributions can occur, see:
Key takeaway
A scheduled dividend or income distribution can only be paid if the corporation, business, or trust has sufficient cash available at the time the payment is due. If a planned distribution is missing, the first thing to check is whether the entity has been properly funded and has enough available cash to make the payment.