In GnuCash Liabilities are separate from expenses, which makes sense. However, this makes it difficult to get a useful budget report or expenditure report since it does not include my largest outgo, my mortgage. Is there a way to include my liabilities with my expenses in the reports?
GnuCash appears to have a lot of functionality, but I can't speak to their version of financial accounting.
You need to look for the Cash Flow Report for the total mortgage outflows (interest & principal). Interest expense should show up also on your Income & Expense.
You don't want to mix liabilities & expenses unless if by "liabilities" you mean "cash flows due to debt funding" or the like. Liabilities should be on the Balance Sheet.
If those items can't be found on those sections of the program, I'd try to find their list of accounts (if they provide it) or find another program as it would be very non-standard.
I'm not sure you're using this right. "Liability" is your mortgage balance. "Expense" is your mortgage payment. Each mortgage payment is a split expense: one portion goes to the "Mortgage Interest Expense" account, and the other goes to "Mortgage" liability account reducing the balance.
On your reports you see the decrease in the mortgage liability and the increase in the interest expense, the sum of which gives you the total mortgage payment.
I had the same problem. I like the presentation of the Income & Expense chart but because the non-interest parts of my mortgage payments are not an expense, its usefulness for budgeting is impaired. What I want is a cash flow chart that looks just like the Income & Expense chart but shows cash flow and I don't think this exists.
My work-around is to create two income accounts for my salary. Every time I am paid I create a split transaction where the part of my salary equal to my mortgage payment that month comes from an account called Income:Salary for mortgage and the rest of my salary comes from Income:Salary for expenses.
Then I can just de-select the Income:Salary for mortgage account from the report options and get the view I want.
However I would love for someone to tell me the correct way to get the view I want. I suspect one of the budget reports will do it but I am suffering from Bug 638971 and the budget interface seems fiddly.