Realisation and Settlement date: Difference between pages

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'Realisation' refers to the conversion of assets, profits or losses into cash.
The settlement date is the date on which a security transaction is settled, for example, payment is made and securities are physically received and delivered or beneficial ownership records are changed in central securities depositories.
 
Realisation can occur either on the receipt or payment of cash, or at an earlier time when such receipt or payment of cash becomes virtually certain.
 
 
Generally accepted accounting practice allows the [[recognition]] of income and assets only when their realisation in the form of cash, or other assets that are readily realisable, can be assessed with reasonable certainty.
 
The concept of realisation arose for the protection of the creditors of companies, to ensure that sufficient cash was available to distribute profits without a company or other entity becoming insolvent.
 
 
Only realised profits may be distributed under company law.  




== See also ==
== See also ==
*[[Accruals basis]]
* [[Central securities depository]]
*[[Accumulated other comprehensive income]]
* [[Trade date]]
*[[Contingent assets]]
*[[Crystallisation]]
*[[Recognition]]
*[[Unrealised profit]]


[[Category:Accounting,_tax_and_regulation]]
[[Category:Financial_products_and_markets]]

Latest revision as of 08:55, 7 February 2019

The settlement date is the date on which a security transaction is settled, for example, payment is made and securities are physically received and delivered or beneficial ownership records are changed in central securities depositories.


See also

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