Recording Challenge Costs and Refunds
The big fix here is the refunds-on-Dashboard language and the reports section, both incorrectly position refunds as income. Plus a few smaller cleanups.
Recording Challenge Costs and Refunds
Tracking challenge costs accurately is essential for understanding your trading business profitability. This article covers how costs and refunds are recorded and calculated.
Understanding Challenge Costs
When you purchase a prop firm evaluation, that's a business cost. The money leaves your account and goes to the prop firm in exchange for the opportunity to prove yourself.
What Counts as a Challenge Cost
Initial purchase price: The amount you paid when buying the challenge. This is the primary cost.
Add-ons: Some firms offer add-ons like:
Account scaling options
Profit split upgrades
Extended time limits
Insurance and reset options
If purchased with the challenge, include these in the total cost.
Subscription fees: Some firms charge ongoing fees while you're in the challenge. If you paid these upfront, include them. If they're monthly, consider tracking them as separate transactions.
Where Costs Appear
Challenge costs flow into the system like this:
You enter the cost when creating the challenge
The platform records it as a challenge cost entry
It feeds the Money Out side of your Dashboard
It also shows in the Challenge Costs KPI card
Your monthly P&L calendar will show months where you purchased challenges as having higher costs.
Recording the Initial Cost
When you add a new challenge, there's a field for "Purchase Cost" or "Cost":
Enter the total amount paid
Select the correct currency
The cost is recorded with the challenge
If you paid in multiple transactions or the price changed, enter the final total amount.
Updating Costs Later
If you need to change the cost after creating a challenge:
Open the challenge detail drawer
Navigate to the Financials tab (if available) or Overview
Edit the cost amount
Save changes
The system will update to reflect the corrected amount.
Understanding Refunds
Refunds are money you receive back from a prop firm. They might occur because:
You passed the challenge and the firm refunds the fee
The firm offers a refund policy you qualified for
A promotional refund or credit
Account cancellation with partial refund
The Key Point About Refunds
Refunds are cost recoveries, not income.
This matters across the whole platform. When you receive a refund:
It reduces your net cost for that challenge
It doesn't count as revenue or profit
It's essentially getting your own money back
Think of it this way: if you spent $500 on a challenge and got a $500 refund, you didn't make $500, you broke even on that challenge.
Recording a Refund
To record a refund received on a challenge:
Open the challenge detail drawer
Navigate to the Financials tab
Look for "Add Refund" or similar option
Enter:
Refund amount
Date received
Notes (why you received it)
Save
The platform records this as a refund tied to the specific challenge, and the challenge's Net Cost will decrease accordingly.
Net Challenge Cost
For any challenge, the net cost is:
Net Cost = Original Cost − Refunds Received
For example:
Challenge cost: $500
Refund received: $500
Net cost: $0
This net cost is what truly impacts your profitability.
Where Refunds Appear
Refunds show up in a few places, and the way they're displayed depends on where you're looking:
Challenge Detail. The Financials tab shows both cost and refunds, plus the net total.
Dashboard KPIs and totals. Refunds reduce your challenge cost totals. They are not added to income, payouts, or any revenue figure.
Money In vs. Money Out chart. This one chart on the Dashboard is the only place refunds appear on the Money In side. That's because it's a gross cash direction view, showing every dollar that physically moved into or out of your accounts. It's not a revenue chart, so refunds belong on the inbound side there. Everywhere else, refunds reduce expense totals.
Reports (Income Report, Expense Report, Annual Tax Summary). Refunds appear as negative expense rows in the Expense Report, reducing your total challenge cost. They never appear in the Income Report and they are not listed alongside payouts. The Annual Tax Summary shows challenge costs already net of refunds.
This consistency, refunds reducing expenses rather than adding to income, is the only way to keep your trading business numbers accurate. Treating a refund as income would inflate revenue and inflate costs at the same time, throwing off both numbers.
Common Scenarios
Passed Challenge with Fee Refund
Many firms refund the challenge fee when you pass. Record this refund after you receive it, not when you pass, but when the money hits your account.
Failed Challenge, No Refund
Most failed challenges don't receive refunds. The cost stays on your records as part of the investment required to eventually get funded.
Partial Refund
Some firms offer partial refunds in certain situations. Record whatever amount you actually received.
Multiple Refunds
If you receive a refund in parts, record each separately. The total will accumulate.
Tracking Costs Over Time
Your Dashboard shows:
Total challenge costs for the selected period
Monthly breakdown in the P&L calendar
Comparison to revenue (payouts)
Over time, you want to see total payouts exceeding total challenge costs. This means your funded accounts are generating more revenue than you're spending on evaluations.
A healthy trading business might look like:
Challenge costs: $3,000
Payouts: $10,000
Net: +$7,000
An unhealthy pattern might show:
Challenge costs: $5,000
Payouts: $1,000
Net: -$4,000
The Challenges module helps you track the cost side of this equation.