A good starting point is input data because the Standards rely on the integrity of input data to accurately calculate results. Portfolios must be valued in accordance with the definition of fair value, not cost or book values. In fact, fair value supersedes market value. Transactions are reflected in the portfolio at settlement when the exchange of cash, securities, and paperwork involved in a transaction is completed. Accrual accounting is used for fixed-income securities and all other assets that accrue interest income; dividend-paying equities accrue dividends on the ex-dividend date.”
Q. In her statement regarding input data, Basco is least likely correct with respect to:
- settlement date accounting.
- fair value.
- accrual accounting.
Solution
A is correct. The GIPS standards require that firms use trade date accounting for the purpose of performance measurement for periods beginning 1 January 2005 (Provision I.1.A.5). The principle behind requiring trade date accounting is to ensure that no significant lag occurs between a trade’s execution and its reflection in the portfolio’s performance.
我想问下这个trade data accounting 的含义，跟题干描述有什么区别？
