# ASC 320-965-25: Investments—Debt Securities — Plan Accounting—Health and Welfare Benefit Plans — 25 Recognition

Source: FASB Accounting Standards Codification, Basic View

[Read online](https://asc.understandingaccounting.org/asc/320/965/#25-recognition)

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## ASC 320-965-25: 25 Recognition

[Read section](https://asc.understandingaccounting.org/asc/320/965/#25-recognition)

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##### [320-965-25-1](https://asc.understandingaccounting.org/asc/320/965/#320-965-25-1)

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The accrual basis of accounting requires that purchases of securities be recorded on a trade-date basis. However, if the settlement date is later than the financial statement date, accounting on a settlement-date basis for such purchases is acceptable if both of the following conditions exist:

1.  a
    
    The [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.") less costs to sell, if significant, of the securities purchased just before the financial statement date does not change significantly from the trade date to the financial statement date.
    
2.  b
    
    The purchases do not significantly affect the composition of the plan's assets available for benefits.

##### [320-965-25-2](https://asc.understandingaccounting.org/asc/320/965/#320-965-25-2)

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See Subtopic 965-325 for guidance on accounting for other investments, in particular investment and insurance contracts, of [health and welfare benefit plans](https://asc.understandingaccounting.org/glossary/h/#health-and-welfare-benefit-plans "Health and welfare benefit plans include plans that provide the following: Any of the following benefits: Medical, dental, visual, psychiatric, or long-term health care Life insurance (offered separately from a pension plan) Certain severance benefits Accidental death or dismemberment benefits. Benefits for unemployment, disability, vacations, or holidays Other benefits such as apprenticeships, tuition assistance, day care, dependent care, housing subsidies, or legal services.").