MSRB TRANSACTION REPORTING PROGRAM
QUESTIONS AND ANSWERS Updated March 2002
These questions and answers are organized under the
CUSTOMER TRANSACTION REPORTING
Preparing for Customer Transaction
"Fully Disclosed" Brokers
Completing the Customer Transaction
Price and Yield
Time of Trade
Amending and Cancelling Trades
Changes that Should Not
File Forwarding by NSCC
Using MSRB's Dial-Up Facility
Testing Customer Transaction
Reporting with the MSRB
Record and File Format Questions
Executing Broker Symbol
Year 2000 Compliance
Unofficial CUSIP Numbers
Transfers of Securities into
INTER-DEALER TRANSACTION REPORTING
Problems in Inter-Dealer Transaction
Q: What is the purpose of
the requirement in MSRB rule G-14 to report each municipal securities
transaction to the MSRB?
A: One purpose of
the requirement is to make transaction information (e.g., prices
and volumes) available to market participants. This is generally
known as the "transparency" function of the MSRB Transaction Reporting
Program. It is being accomplished at this time through a daily report
that shows information such as the high, low and average prices
of municipal securities that were traded four or more times on the
previous day. A second, equally important, purpose is market surveillance.
Each transaction reported is entered into a database that essentially
is an audit trail of transactions. This database is available only
to the SEC, the NASD and other regulators charged with surveillance
of the market and inspection for compliance with and enforcement
of Board rules. Transparency and surveillance functions have long
been in existence in other major U.S. securities markets. The MSRB
is responsible to bring these functions to full implementation in
the municipal securities market.
Q: Have the requirements of
G-14 been approved by the Securities and Exchange Commission?
A: Yes. The Commission
approved the transaction reporting requirements described here on
November 29, 1996 (Securities Exchange Act Release No. 37998; see
also MSRB Reports, Vol. 17, No. 1 [January 1997] at 3-8,
and Securities Exchange Act Release No. 39495, December 19, 1997).
Q: When does compliance with
these functions have to take place?
A: Inter-dealer transaction
reporting began on January 23, 1995, with an amendment to rule G-14.
(See MSRB Reports, Vol. 14, No. 5 [December 1994] at 3-6.)
Each dealer should now be well aware of the specific requirements
of reporting inter-dealer transactions. A number of notices have
appeared in MSRB Reports indicating areas where attention is specifically
needed to improve inter-dealer reporting. (See, e.g., MSRB
Reports, Vol. 16, No. 2 [June 1996] at 9-12.) The requirement
to report customer transactions to the Board became effective March
Q: How does a dealer report
municipal securities transactions to the MSRB?
A: The answer to
the question differs depending upon whether the transaction is with
another dealer ("inter-dealer transaction") or with an entity that
is not a dealer ("customer transaction"). Inter-dealer transactions
are reported by submitting the required transaction information,
in proper form, to the automated comparison system for municipal
securities. Dealers achieve both the automated comparison function
and the transaction reporting function by submitting a single file
to the comparison system. For customer transactions, dealers must
produce a computer-readable file specifically for the MSRB and transmit
that file to the MSRB each night.
Q: I have read all these questions
and answers, but I still need assistance getting started. Whom shall
A: Call the MSRB's
main number (703-797-6600) and ask for a Transaction Reporting Assistant.
This person may be able to help you get started, advise on how to
report trades accurately, or assist with technical matters.
CUSTOMER TRANSACTION REPORTING
Preparing for Customer Transaction Reporting
Q: What should dealers do
to prepare for customer transaction reporting, if they plan to begin
effecting trades with customers?
A: Dealers are required
to report their customer transactions in municipal securities as
soon as they begin effecting such trades. To be prepared to report
the transaction, a dealer should become familiar with the G-14 requirements
and either be sure its computer system has the capability to produce
and transmit files of customer transaction data, or make arrangements
with a clearing broker or service bureau who will do this on their
behalf. The dealer should obtain from the Board, complete, and return
a Customer Transaction Reporting Form. Dealers must successfully
test their transaction reporting capabilities with the Board before
they effect transactions.
"Fully Disclosed" Brokers
Q: My firm is "fully disclosed"
and acts only as an "introducing broker" on municipal securities
trades. Is this considered to be "effecting municipal securities
transactions" so that I must comply with rule G-14?
Completing the Customer Transaction Reporting
Q: In completing the Customer
Transaction Reporting Form, whom should I identify as the "primary
contact with the MSRB for purposes of customer transaction reporting"?
Should I name our Municipal Securities Department Director or our
A: The primary contact
should be the individual who will be ultimately responsible for
ensuring that MSRB mailings and other communications (e.g., phone
calls) on this subject will reach the appropriate persons in the
firm. The primary contact also will be the MSRB's initial contact
regarding tests of customer transaction reporting.
Q: Who should be identified
as the "point-of-contact regarding technical matters"?
A: The MSRB will
contact this person on computer-related matters such as the firm's
telecommunications and methods for transmitting files, how many
characters each field should have in the record of a trade, what
headers must be included in the files, etc.
Q: How do the above topics
differ from the person designated for questions about the "correctness
of trade details"?
A: In general, the
contact for "correctness of trade details" will be the person whom
MSRB staff will call if the question is about the substantive information
being provided about a transaction. A question about trade details
might arise, for example, if MSRB calculates a yield that differs
substantially from the dealer-reported yield for the same trade.
MSRB staff may ask the dealer what it used to derive yield from
dollar price to account for the difference.
Q: In response to the question
on page one of the form, my firm does not effect municipal securities
transactions, does not intend to do so and does not intend to submit
transactions to the MSRB for other dealers. I will check the appropriate
box and return the form. What should I do if my firm's plans later
A: Since all transactions
in municipal securities will have to be reported to the MSRB, if
a firm decides to begin effecting transactions or to submit transaction
data, it should immediately contact the MSRB to obtain and complete
this form and take the other steps described above.
Q: What is the "dial-up transmission
facility" referred to in the form?
A: Most dealers will
send customer trade data to the MSRB through National Securities
Clearing Corporation (NSCC), but some low-volume transmissions may
be done by dialing the MSRB's computer directly using a personal
computer and telephone modem. By checking the appropriate box on
the form, you may request more information about the dial-up facility
from the MSRB. In response, the MSRB will mail information that
describes how to install and use the dial-up facility to report
Q: Where can I find a description
of the data elements that must be included in transaction records?
A: The MSRB document
entitled "File and Record Specifications for Reporting Customer
Transactions" defines the data elements and provides format specifications
for transaction records and files.
Q: When must a transaction
be reported to the MSRB?
A: Transaction information,
in the correct format, must reach the MSRB by midnight on trade
Q: How is this transaction
information sent to the MSRB?
A: The information
is formatted into electronic records which are put into a file with
appropriate "header" information. The resulting file is sent to
Q: My firm is a clearing broker
and will be submitting a file each day on behalf of many of our
correspondents. Is there any special way in which the records in
the file should be organized?
A: No. As long as
the header information is correct and the information in each record
is correct, the records within the file can be in virtually any
order. The header identifies the party submitting the file; the
records may pertain to any number of executing dealers. However,
if a file contains both the first report of a trade ("F" record)
and a change to that trade, the "F" record must precede any change
records ("A", "C" or "V" records).
Q: Are institutional and retail
customer transactions reported in the same way?
Price and Yield
Q: Both price and yield are
required to be included for transactions on which the settlement
date is known. Why is that?
A: One of the most
difficult problems in collecting and disseminating accurate information
on municipal securities transactions is that there are approximately
1.3 million different municipal securities. Typographical errors
in trade input, for example, are always possible, and since there
is generally not a stream of transaction data coming in on a specific
issue, it is difficult for the system collecting the information
to mechanically check reported information to ensure that it is
not a likely input error. This is particularly important when it
is recognized that the price information collected will be disseminated
and reviewed by market participants on the next day and may be used
as part of trading or investment decisions. Requiring both yield
and price, along with the CUSIP number of the issue being reported,
will allow the MSRB to mechanically perform mathematical checks
that will help to ensure that the information being reported makes
sense, given the coupon, maturity date and call features of the
security. Other means of checking data accuracy also will be employed.
For example, the CUSIP check digit is required to guard against
typographical errors in the entry of CUSIP numbers.
Q: What if a yield cannot
be computed for a transaction done on a dollar price basis, for
example, because the trade is in a variable rate security or in
a defaulted security?
A: The trade data
may be reported to the MSRB using a dollar price only in these cases.
Note, however, that if the security is not known to the MSRB system
as one which is a variable rate instrument or which is in default,
the MSRB may contact you to ensure that its information about the
security is correct and so that subsequent transaction input in
the security will not be questioned in the future.
Q: Should I report to the MSRB the transaction's yield
to maturity or another yield -- yield to first call, yield to par
call, etc.? My system calculates several yields for use in customer
A: Report the yield as required by MSRB rule G-15(a)
for customer confirmations. Rule G-15(a) in most cases requires
the yield to be computed to the lower of call or nominal maturity
date. Exception: If the transaction was effected at par, the yield
(coupon rate) should be reported to the MSRB on the customer trade
record, even though rule G-15(a) allows the yield to be omitted
from the confirmation in such a case. If reporting the yield is
not possible because the transaction was done on a dollar price
basis and no settlement date has been set for a "when-issued" security,
leave the yield blank or enter zero.
Q: How should
I report negative yield?
A: Enter a negative
number in the "yield" field. The minus sign may precede or follow
the number, as long as it is inside the defined field area.
Q: What if the settlement
date for a transaction is not known because the transaction is in
a new issue and settlement date has not been set?
A: You should report
the transaction with a yield or a dollar price and without a settlement
Q: The MSRB's system sends
us an error message, "AMEND RECORD (or cancel and resubmit). Settlement
date not in date format," when we report a when-issued trade with
unknown settlement date. Because of this "error," we must report
the trade again, with the known settlement date. How can we prevent
A: Check the actual
data you are transmitting to the MSRB. Your computer system may
be putting in a default value such as 99999999 when it does not
have a definite settlement date. Instead, in this case, your system
should leave the settlement date field blank or report 00000000
as the date.
Q: If the settlement date
for the transaction is determined after a submission is made without
a settlement date, should the dealer report revised trade information
to the MSRB?
A: No. If the only
change in the transaction information is the settlement date on
a new issue, the dealer should not send an amended transaction report.
Agency/Principal Transactions and Commission
Q: When reporting dollar prices
on agency transactions, should the effect of commissions be included
in the dollar price reported to the Board?
A: No. There is a
separate field for reporting the commission amount on agency transactions.
The MSRB will include the effect of the commission in the dollar
price when aggregating principal and agency transactions and reporting
price information on the public daily report. There should be no
"commissions" on principal transactions so that the dollar price
given on principal transactions should be the net transaction dollar
price to the customer.
Q: How should commission be
A: Commission is
reported in dollars per $100 par value.
Q: Should the effect of the
commission be reported in the yield?
A: Yes. You should report as yield the same "net"
yield that is reported on customer confirmations. Therefore, the
reported yield should include the effect of any commission (see
MSRB rule G-15(a)).
Q: Should miscellaneous fees
such as transaction fees be included in the commission field or
Q: The file format requires
each transaction submitted by a dealer to have a unique "control
number" (unique for the dealer) that is no longer than 20 characters
and that may be composed of alpha and/or numeric characters. Why
is this necessary?
A: The control number
reported by the dealer is the mechanism by which the dealer identifies
a specific transaction to the Transaction Reporting System. The
dealer chooses its own numbering system; however, the control number
for a transaction must be unique for the dealer within a three-year
period. For example, if a dealer submits two different transactions
with the same control number, the system will reject the second
transaction. Use of the control number is critical so that the dealer
may correct information submitted in error to the system. The MSRB
also will use the dealer's control number to report back information
to the dealer about the transaction.
Q: How should the "Buy/Sell"
code be reported?
A: When the customer
has purchased securities, the dealer's Buy/Sell code should be "S"
(sell). Similarly, when the customer has sold securities, the dealer's
Buy/Sell code should be "B" (buy).
Time of Trade
Q: Why does the MSRB need
the time of trade?
A: This information
is needed for audit trail purposes. It is not currently used in
the transparency component of the program.
Q: How is time of trade reported?
A: It is submitted
in military format (e.g., 1400 for 2:00 p.m.) and in terms of Eastern
Q: If I cannot report a customer
trade by midnight of trade date, should I report it later?
A: Yes. Every customer
trade should be reported, even though it may be late. Some dealers
refer to late-reported trades as "as-of" trades. It is important.
that these trades be included in the database for audit trail purposes,
along with trades reported on trade date.
Q: Should I report the date
I send the as-of trade to the MSRB?
A: Report only the
actual trade date and (if known) the settlement date on the individual
trade record. The file header contains the "submission date," which
is when all the information in the file was reported to the MSRB.
Amending and Cancelling Trades
Q: Under what circumstances
would a dealer need to correct information about a transaction submitted
to the system?
A: An example might
be a dealer who has made an input error resulting in the wrong price
or yield being submitted for a transaction. Note that it is important
for these errors to be corrected as soon as possible so that the
audit trail and surveillance database is correct. Note also that
it is important for errors like these to be minimized since the
prices reported on trade date will be used for the daily reports
appearing on the next business day.
Q: What will the MSRB do if
it discovers a probable input error that has resulted in submitted
A: As part of the
daily process of collecting transaction information from dealers,
the MSRB will send to each dealer that submitted transaction information
a receipt with messages identifying errors in transactions that
failed to meet acceptance testing, together with a copy of all such
Q: What should happen next?
A: If the dealer
finds that the record should be amended -- for example, because
of a typographical error in the price -- he or she will submit an
"Amend" record as soon as possible (i.e., a record with "A" as the
"Cancel/Amend Code"). The "Amend" record must include the same dealer
control number as the first report of the trade and must include
all of the correct information about the trade. If the dealer finds
that a "questioned" record was correctly submitted, a "Verify" record
may be submitted, including the original dealer control number,
to indicate that it is correct.
Q: How can I find out more
about correcting reported trades?
A: See the MSRB's notice dated April 17, 1998
on error messages. This describes categories of error messages and
how to respond to them.
Q: What happens if I try to
amend a transaction with a control number that I have not previously
A: If a transaction
is submitted with a "Cancel/Amend Code" of "A" and there is not
an existing transaction in the database with that control number,
the transaction information will be rejected -- that is, returned
to the dealer for correction.
Q: Can I amend any
information about a trade that I have previously reported?
A: No. The following
fields cannot be amended: dealer identity, CUSIP number, trade date,
and transaction control number. If you report a trade with an error
in one of these fields, you should cancel the transaction report,
as described below, and then report the trade using a new control
Q: Under what circumstances
would a transaction be "cancelled" in the system and how is that
A: There may be limited
numbers of instances in which customer transactions are reported,
but the transactions later must be cancelled with customers due
to circumstances beyond the dealer's control (for example, a new
issue is cancelled). In this case, the dealer must submit a record
with the control number of the transaction and with the "Cancel/Amend
Code" set to "C" for "Cancel." Doing so will allow MSRB to indicate
the transaction as cancelled in the surveillance database so that
the database is accurate.
Q: When my firm corrects a
trade, our system assigns a new control number to the trade. Should
I report the new control number?
A: There is no need to report the new control
number if this is the only change to the data required by G-14.
If other data also changes, the recommended method is to"Amend"
the trade so that its attributes are correct. Submit an "Amend"
("A") record with the original control number in the "Previous
Record Reference" field and the new control number in the "Dealer's
Transaction Control Number" field. Note that any subsequent changes
to this trade must include the original control number,
since the TRS uses that number for all records of the trade. An
alternative method is to cancel the trade, using the original control
number, and report a new trade ("F" record) with only the new control
Q: Isn't it possible just
to change the control number of the trade?
A: No. Once the Transaction
Reporting System records a trade, it stores all subsequent information
under the original control number. You cannot amend the control
number. You must continue to submit data with the original control
number, or cancel the original record and submit a new "First Report"
Q: What should I report when
an issue, originally traded as "when-issued" without a settlement
date, starts to trade regular way?
A: If the only change
is that the issue starts to trade regular way or that the issue's
settlement date has been determined (or changed), there is no need
to cancel or amend the trade. If possible, you should suppress the
reporting of these events to the MSRB.
Q: For how long after initial
submission is it possible for dealers to amend or cancel transactions
that have been entered into the system?
A: This can be done
within three months after the trade's settlement date. Note that,
while some numbers of cancellations and corrections are inevitable,
it is important for dealers to minimize the need for these types
of corrections by making sure that procedures are in place for reporting
necessary information correctly in the initial submission.
Q: When my firm cancels and
rebills a trade, we get an error message from the MSRB system about
the time of trade, even though we originally reported the time.
How can we prevent this error?
A: You must report
the time of trade in every "first" or "amend" ("F" or "A") trade
record. If you cancel an already-reported trade and report it again,
you must include the time of trade on the new "F" record.
Q: Can I put "change" records
in the same file as the record I am changing?
A: Yes - you may
put a change (a Cancel, Amend or Verify record) into the same file
as the original record. However, to ensure that the system carries
out the actions in the proper order, the "change" record must follow
the original record in the file. For example, the system cannot
cancel a trade record before it processes the record itself.
Changes that Should Not be Reported
Q: Should I amend or cancel
a trade whenever I change my internal records of the trade?
A: No. You should report to the MSRB only
changes relevant to the Board's transaction reporting purposes,
for example, a change in the price or par value of a trade. You
should not report a change if it does not involve a required data
item. For example, if you change the customer's account number or
account representative, you should not send a second report of the
trade to the MSRB. Finally, as noted above, you should not amend
or cancel a trade record in a new-issue security just to change
or add the settlement date.
File Forwarding by NSCC
Q: My organization processes
thousands of customer transactions in municipal transactions each
day. How can such a large file be sent to the MSRB?
A: National Securities
Clearing Corporation is providing its participants the ability to
send the MSRB customer transaction file to NSCC along with other
types of files that are sent to NSCC each day. NSCC will forward
the MSRB customer transaction file to the MSRB.
Q: My firm uses another broker-dealer
for clearing and processing municipal securities transactions. The
clearing broker submits my inter-dealer transactions to NSCC on
my behalf. Can the clearing broker submit my customer transaction
reports to NSCC for forwarding on to the MSRB on my behalf?
A: Yes. The clearing
broker can submit transaction reports for dealers for which it clears
transactions. Note that the dealer effecting transactions is responsible
for the clearing broker's performance in this regard. You should
talk with your clearing broker now to ensure that it will provide
Q: My firm uses a service
bureau to submit inter-dealer transaction information to NSCC. Can
the service bureau also submit customer transaction files to NSCC
for forwarding to the MSRB?
A: Yes. As in the
previous answer, the dealer effecting transactions is responsible
to report the transactions correctly.
Q: Are there any special requirements
for formatting the file to NSCC and getting the file to NSCC?
A: Yes. You should
review NSCC's April 2, 1997 Important Notice on the interface requirements
for customer transaction reporting (Notice No. A-4571/P&S 4155).
This and later notices are available from NSCC's Web site (www.nscc.com).
Similarly, if a clearing broker or service bureau will be sending
your MSRB customer transaction files to NSCC for forwarding to the
MSRB, they should ensure that the files can be sent in the correct
Q: Will customer transaction
records submitted to NSCC for forwarding to the MSRB be included
in the automated comparison system?
A: No. The MSRB customer
transaction file sent to NSCC for forwarding to the MSRB is a totally
separate file than the inter-dealer transactions and other files
sent to NSCC for clearance and settlement purposes. NSCC will not
process data in the MSRB customer transaction files, but will only
forward the files to the MSRB. The use of NSCC for this purpose
will allow dealers and service bureaus to use existing telecommunication
channels set up between dealers and NSCC and between NSCC and the
MSRB. Thus, it should provide efficiencies, especially for dealers
that have many customer transactions each day.
Q: May I include my inter-dealer
trades in the customer trade file I send to the MSRB?
A: No. All files
submitted as part of a dealer's customer transaction file must report
only customer transactions -- no inter-dealer transactions may be
Using MSRB's Dial-Up Facility
Q: My firm submits its inter-dealer
transactions to NSCC through a dial-up terminal or personal computer.
Can I use this method of file transfer to transmit customer transaction
files to NSCC for forwarding to the MSRB?
A: No; as noted in
NSCC's Important Notice, all dial-up connections for transaction
reporting will be directly to the MSRB.
Q: How is this done?
A: Dealers may send
relatively small files directly to the MSRB by using a personal
computer and a standard telephone modem, such as those made by Hayes,
U.S. Robotics and others. The MSRB provides telecommunications software
to dealers who ask for this service. Please note that this software
will run only on computers using the Windows 95
or Windows NT operating systems. Also note that dealers using this
method of transmitting files directly to the MSRB will still need
a means to generate files from their own records that meet MSRB
file and record format requirements. This may be done by writing
a program to reformat the dealer's data to meet the MSRB file specifications,
or by keying in trade data to the MSRB PC software.
Q: I have obtained and installed
MSRB's software, but I have trouble connecting to the MSRB system.
What are the most common causes of failure to connect?
A: Many causes of
connection failure are addressed in the "PC TRS Troubleshooting
Guide," which you should review. Sometimes problems arise when a
PC is used for telecommunications with other systems in addition
to the MSRB system, so it is best to have the PC TRS software on
a "stand-alone" PC. If your PC uses a local area network (LAN) to
dial out, try connecting the PC to its own modem and telephone line.
Q: Perhaps my connection problems
are too technical for me to resolve. Where can I get technical support?
A: Ask your firm's
technical support staff to check that your NetBEUI and Microsoft
Client software components are present. You are also welcome to
call the MSRB at (703) 797-6600 and request technical help from
a Transaction Reporting Assistant.
Testing Customer Transaction Reporting with
Q. What is the purpose of the requirement
for dealers to test their reporting capabilities with the MSRB?
A: The purpose of
testing is to ensure each dealer that its own system can produce
files containing the required information in the proper format,
that it is able to correct erroneous input, and so forth. Testing
is mandatory so that all the dealer will be ready before effecting
customer transactions, since the transactions must be reported on
Q: My firm plans to begin
doing trades with customers soon but we did not participate in testing
during 1997. How can we test our submission method with the MSRB?
A: Contact the Board's
Transaction Reporting Assistants by telephone. They will inform
you how to submit test trades to the Transaction Reporting System.
The testing method will vary, depending upon how you submit customer
Q: What will happen during
A: First, the MSRB
will request obtain information on how your organization will be
submitting data, a fax number where you can receive receipt/error
logs from the MSRB, and technical details. Dates will be chosen
to run your test. Your firm's testing point-of-contact will arrange
to send test files to the MSRB, using either NSCC or the MSRB dial-up
facility, to establish that the telecommunications link is working,
and to verify that the trade records meet the format specifications.
Q: How long will the test
A: Each test cycle
should take approximately five days. However, it may take more than
one test cycle for a dealer to validate its methodology for creating
files in the proper formats and for handling trade data corrections.
Q: Will there be special formats
and test procedures for submission through NSCC?
A: Yes. As part of
testing the communications, dealers and service bureaus will go
through NSCC's usual procedures for setting up transmission of a
new data stream or "SysID" - verifying that the file header meets
Datatrak specifications, etc. Details are provided in the NSCC Important
Notice previously mentioned (Notice No. A-4571/P&S 4155).
Record and File Format Questions
Q: What is the format for
the computer-readable file that must be sent to the MSRB each day
to comply with the customer transaction reporting requirement?
A: For files sent
directly to the MSRB via the MSRB dial-up facility, the physical
formats of transaction records, and of the file header record that
must precede them, are specified in the MSRB document entitled "File
and Record Specifications for Reporting Customer Transactions."
Files sent to NSCC will need to be in the format specified by NSCC.
See NSCC's April 1997 Important Notice.
Q: Can I include binary data
in the customer transaction file, along with ASCII data?
A:No. Binary data
should not be included, even in the unused portions of the record.
Q: The MSRB file header record
requires a "version number." What should be put here?
A: This field identifies
the version of the MSRB format specification that applies to the
file. Initially, use '00010' here.
Q: The header record requires
a "record count" field. What should be put here?
A: Put here the number
of transactions being reported in this file. (Do not count the header
Q: If the header record of
a transaction file contains errors, how will MSRB inform the submitter
of this fact?
the file has a submitter identifier known to the MSRB, the Transaction
Reporting System will send a receipt/error message file or fax to
the submitter. The header errors will be identified in the file
in the first two records following the receipt record, using the
same format as for transaction detail errors. MSRB will not accept
any direct submissions by dial-up from unknown parties.
Q: Is the customer's identity
included anywhere in the information reported?
The customer's identity is never submitted in reports of customer
Executing Broker Symbol
Q: Why does the MSRB need
an "executing broker symbol"?
symbol is used for the audit trail function. It identifies the dealer
that actually effected the transactions (in contrast to the dealer
that submitted the trade information or who cleared the trade).
It is particularly important for dealer identification when one
dealer clears or submits data for several other dealers. The dealer
that actually effected the transaction should be the one identified
with this symbol.
Q: What symbol should be used
for executing broker identity?
four-character symbol of the firm or bank assigned by the NASD,
for example, ABCD.
Q: Is it permissible for my
firm to use our NSCC clearing number (e.g., 1234) instead of this
symbol? In our case, this would serve the same purpose since we
only clear for ourselves.
The four-character alphabetic symbol is required, as it is the standard
identifier used in the surveillance database.
Q: My organization does not
have one of these symbols. Should we just use the symbol of the
dealer that we clear through?
If your organization is a broker, dealer or municipal securities
dealer and it is effecting trades in municipal securities (with
other dealers or with customers), it must use its own symbol.
Q: How does a dealer obtain
an NASD-assigned symbol if it does not already have one?
you clear inter-dealer trades through an NSCC participant, call
the NSCC Marketing Department to obtain a broker symbol. (Use this
symbol for both customer and inter-dealer trade reporting.) Otherwise,
call NASD Subscriber Services at (800) 777-5606 and explain that
you need a symbol for reporting municipal securities transactions.
Q: Will the NASD assign a
symbol, even though my organization is a dealer bank?
Q: Our firm has an NASD-assigned
four-letter "market participant ID." Do we need an executing broker
symbol as well?
A: No. "Market participant ID" (MPID) is a synonym
for "executing broker symbol."
Year 2000 Compliance
Q: Is the personal computer
software (PC TRS) year-2000 compliant?
A: PC TRS has been designed to be year-2000 compliant.
It stores all dates using four digits, e.g., 2001. However, dates
are displayed on the screen in the format used by the operating
system on the dealer's computer. It will display 2-digit dates if
the computer is set for that format. You may change the display
format for dates using the "regional settings" screen of the control
Unofficial CUSIP Numbers
Q: My firm sometimes uses
a temporary CUSIP numbers for trade execution. Eventually we change
these to officially assigned CUSIP numbers. How can we report these
A: Dealers should not report trades unless
the security has been assigned a CUSIP number by the CUSIP Service
Bureau of Standard & Poor's. Such trades should be
reported once a CUSIP number is officially assigned. Report the
trade using the actual trade date, even if you are reporting it
after trade date. Note that, per rule G-34(a), if trading is done
in a new issue security, the broker or dealer that acquires the
issue from the issuer must apply for assignment of a CUSIP number
in time to ensure assignment of the number by the date of sale or
Transfers of Securities into UITs
Q: My firm buys securities that
we deposit into an accumulation account for ultimate transfer to
a unit investment trust (UIT). At times, we purchase and hold the
securities over a period of several days before depositing them
with a UIT we sponsor in exchange for all of the units of the trust.
The securities are valued at the purchase price when they are deposited
with the trustee of the UIT. Is the deposit of the securities with
the UIT trustee considered a "transaction" for purposes
of MSRB Rule G-14?
A: No. At this time a deposit
of the type you describe is not necessarily considered a customer
transaction for reporting purposes under Rule G-14. In part, this
is because it appears that the price of the deposit may, or may
not, represent the actual market price of a customer transaction
on the day and at the time of the deposit. The Board, however, may
review this interpretation in the future if the Transaction Reporting
System is enhanced to allow deposits to UITs to be specifically
labeled as such in the transparency reports.
INTER-DEALER TRANSACTION REPORTING
Q: How are inter-dealer transactions
reported to the MSRB?
transactions are reported by submitting the transaction data on
trade date, to the automated comparison system, in the format and
manner required by that system to obtain a comparison on the night
of trade date. NSCC provides this information to the MSRB to accomplish
transaction reporting for those trades.
Q: What items are required
by rule G-14, in addition to the items necessary to obtain an automated
comparison of an inter-dealer trade on the night of trade date?
items that are mandatory, in addition, to the information required
for automated comparison, are: (i) accrued interest, on any transaction
in which the settlement date is known; (ii) the NASD-assigned executing
broker symbol identifying the executing broker (e.g., "ABCD") ;
and (iii) time of trade.
Q: Why does the MSRB need
accrued interest in inter-dealer transaction reports?
most transactions reported through the automated comparison system,
dealers report a final money figure in lieu of a dollar price or
yield. The MSRB derives a dollar price for these transactions by
subtracting the reported accrued interest and dividing the result
by the par amount traded. Therefore, if accrued interest is not
reported correctly, the resulting dollar price may not be accurate.
Problems in Inter-Dealer Transaction Reporting
Q: What kind of problems has
the MSRB seen in the inter-dealer transaction information submitted
under rule G-14?
the daily report generated by the Program, only compared transactions
can be used for generating price and volume information. It accordingly
is very important for dealers to ensure that their procedures for
reporting inter-dealer transactions are designed to submit correct
information reliably to the automated comparison system. A significant
number of the following types of transaction in the automated comparison
system indicates that a dealer is having problems that require a
review of its procedures and corrective action: (i) stamped advisories;
(ii) "as of" submissions; (iii) "demand-as-of" submissions coming
in against the dealer; (iv) compared transactions that are deleted
using either the "one-sided delete" function or using the "withhold"
function; (v) trade records without the appropriate executing broker
Q: My firm clears through
a clearing broker. When my firm does trades with another firm that
also uses that same clearing broker, must that transaction be reported
to the MSRB by submitting the trade to the automated comparison
Note that the submission to the automated comparison system is also
required in this instance by rule G-12(f) on automated comparison.
Back to TRS User's Manual
MSRB Home Page