Trade Date Accounting

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Definition of 'Trade Date Accounting'

A method company accountants and bookkeepers use to record transactions that take place on the date at which an agreement has been entered (the trade date), and not on the date the transaction has been finalized (the settlement date). If the transaction involves interest, the interest cannot be recorded on the books until the settlement date has arrived.
Investopedia Says

Investopedia explains 'Trade Date Accounting'

The distinction between trade date and settlement date accounting is an important one, as it can impact the company's financial statements. For example, assume ZXC Corp., which has a year end of December 31, purchases a new factory with debt on December 26, and takes possession of this factor on January 31 of the next year.

If ZXC uses trade date accounting, the asset and loan amount will be recorded in the company's books - without any interest accruing for the five days - on December 26. If they used settlement data accounting, the asset and liability will be recorded in the company's books on January 31 of the following year.
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'Trade Date Accounting'

  • Do I own a stock as of the trade date or the settlement date?

    http://www.investopedia.com/ask/answers/06/settlementtradedate.asp
    ... Retirement. Acronyms; Accounting; Bonds; Buzzwords; Currencies; Economics; Financial
    Theory; ... Do I own a stock as of the trade date or the settlement date? ...

  • Series 65 Study Guide - Trading Securities - Trading Terminology ...

    http://www.investopedia.com/exam-guide/series-65/trading-securities/trading-terminology.asp
    ... as they are today, regular way settlement was the trade date plus five ... the ex-dividend
    date or the record date on a ... Finding The Right Accounting Certification. ...

  • Series 6 Study Guide - Securities Markets - Market Terms ...

    http://www.investopedia.com/exam-guide/finra-series-6/securities-markets/market-terms.asp
    ... settlement occurs three business days after the trade date (T+3 ... Payment Date: The
    date the dividend is actually paid ... Finding The Right Accounting Certification. ...

  • CFA Level 1 Study Guide - Ethics and Standards - GIPS ...

    http://www.investopedia.com/exam-guide/cfa-level-1/ethics-standards/gips-requirements-recommendations.asp
    ... 5.4 Terms of Trade; 5.5 Tariffs and Quotas; 5.6 Trade Restrictions; 5.7 ... 6.3 Accounting
    Process; 6.4 Income Statement Basics; 6.5 Income Statement Components; ...

  • Gauge Portfolio Performance By Measuring Returns

    http://www.investopedia.com/articles/fundamental-analysis/08/performance-analytics-returns.asp
    ... Because the trade date is a better representative of what actually happened, the
    transactions ... This provides a clean accounting of the portfolio's actual value. ...

  • CFA Level 1 Study Guide - Financial Statements - Accounting for ...

    http://www.investopedia.com/exam-guide/cfa-level-1/financial-statements/accounting-dividends.asp
    ... 5.4 Terms of Trade; 5.5 Tariffs and Quotas; 5.6 Trade Restrictions; 5.7 ... 6.3 Accounting
    Process; 6.4 Income Statement Basics; 6.5 Income Statement Components; ...

  • CFA Level 1 Study Guide - Global Economic Analysis - Spot Market ...

    http://www.investopedia.com/exam-guide/cfa-level-1/global-economic-analysis/spot-market.asp
    ... 5.4 Terms of Trade; 5.5 Tariffs and Quotas; 5.6 Trade Restrictions; 5.7 ... 6.3 Accounting
    Process; 6.4 Income Statement Basics; 6.5 Income Statement Components; ...

  • CFA Level 1 Study Guide - Derivatives - Fundamental Differences ...

    http://www.investopedia.com/exam-guide/cfa-level-1/derivatives/fundamental-differences-between-futures-forwards.asp
    ... 5.4 Terms of Trade; 5.5 Tariffs and Quotas; 5.6 Trade Restrictions; 5.7 ... 6.3 Accounting
    Process; 6.4 Income Statement Basics; 6.5 Income Statement Components; ...

  • CFA Level 1 Study Guide - Derivatives - Common Characteristics of ...

    http://www.investopedia.com/exam-guide/cfa-level-1/derivatives/common-characteristics-futures-forwards.asp
    ... 5.4 Terms of Trade; 5.5 Tariffs and Quotas; 5.6 Trade Restrictions; 5.7 ... 6.3 Accounting
    Process; 6.4 Income Statement Basics; 6.5 Income Statement Components; ...

  • Series 26 Study Guide - Recordkeeping Rules - Settlement of ...

    http://www.investopedia.com/exam-guide/series-26/recordkeeping-rules/settlement-delivery.asp
    ... be specified to settle on the same day as the trade. ... be made at the office of the
    purchaser on the appropriate date. ... Finding The Right Accounting Certification. ...

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