Trade-Date Accounting: Importance and Acceptable Alternatives

Trade-Date Accounting

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Question

Although trade-date accounting is recommended, ________ accounting that is disclosed is acceptable for calculating performance.

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Explanation

Trade-date accounting is recommended when calculating performance, although settlement-date accounting is acceptable if disclosed. Because of the volatility and lengthy settlement periods of some markets, trade-date accounting is strongly recommended for calculating the performance of international portfolios.

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