Revised: October 2013
DTCC CONTROLLED NON-CONFIDENTIAL (GREEN)
Contents
1
Executive Summary ................................................................................................ 1
1.1
2
3
Background and Overview of Mutual Funds Guide ......................................................... 1
Introduction and Background................................................................................. 4
2.1
Background ................................................................................................................... 4
2.2
About this Guide ........................................................................................................... 4
Special Considerations and Recommended Practices for Mutual Funds .................. 6
3.1
Lot Depletion Methodology ........................................................................................... 6
3.2
Average Cost Considerations for Transfers ................................................................... 7
3.2.1
Average Cost – Broker Default Method & Changes..................................................... 7
3.2.2
Average Cost – Affirmative Election & Revocations .................................................... 9
3.2.3
Partial Average Cost Transfers of Like Registration under Broker Default and/or
Affirmative Election ............................................................................................... 9
3.2.4
3.3
4
5
Single-Account Average Cost Transfers .................................................................. 10
Transfer Statement Corrections .................................................................................. 10
3.3.1
Processing Error Adjustment ................................................................................ 11
3.3.2
Updated Tax Lot Information Adjustment ............................................................... 12
3.3.3
Corporate Action Adjustment ................................................................................ 13
3.4
In-Kind Retirement Distributions to Non-Retirement Accounts ................................... 13
3.5
Firm-initiated Redemptions on Fund-Controlled Accounts .......................................... 13
3.6
Networking Changes that Impact Cost Basis Reporting Responsibilities ..................... 15
3.7
The Role of Agents in Cost Basis Reporting ................................................................. 16
Annotated CBRS Record Layouts and Recommended Practices for Mutual Funds . 17
4.1
Introduction ................................................................................................................ 17
4.2
General CBRS Considerations ...................................................................................... 17
4.3
CBRS User Master File Considerations ......................................................................... 21
4.4
CBRS Asset Records .................................................................................................... 23
4.5
CBRS Tax Lot Records ................................................................................................. 35
Transfers of Mutual Fund Securities ..................................................................... 48
5.1
Overview ..................................................................................................................... 48
5.1.1
Transfer Methods and Tax Reporting ..................................................................... 48
5.1.2
DTCC Enhancements for Cost Basis Reporting ........................................................ 51

Guidelines for use of “Initiating Firm” Field to the Account Conversion Transfer
Detail/Fund found on Acknowledgement Record A/B/T52, F53 (Important Notice A7472)
........................................................................................................................ 59
5.2
5.1.3
CBRS Record Layouts .......................................................................................... 63
5.1.4
WebDirect .......................................................................................................... 63
5.1.5
Cost Basis Reporting Transfer Types and Examples ................................................. 64
ACATS PTF Transfers and CBRS ................................................................................... 65
5.2.1
Introduction ....................................................................................................... 65
5.2.2
ACATS PTF - Firm Initiated In-Kind Transfer (“Firm Pull”) ......................................... 66
DTCC CONTROLLED NON-CONFIDENTIAL (GREEN)
5.3
5.4
5.2.3
ACATS PTF - Firm Initiated In Kind Transfer to Fund (“Firm Push”) ............................ 67
5.2.4
Special Considerations for ACATS PTF Transfers ...................................................... 68
Networking Transfers and CBRS ................................................................................. 71
5.3.1
Introduction ....................................................................................................... 71
5.3.2
Overview – Networking Transfers .......................................................................... 72
5.3.3
Firm Initiated Networking Fund to Firm Transfer ..................................................... 73
5.3.4
Firm Initiated De-Networking Firm to Fund Transfer ................................................ 74
5.3.5
Special Considerations for Networking ................................................................... 75
Manual Transfers and CBRS ........................................................................................ 78
5.4.1
Introduction ....................................................................................................... 78
5.4.2
Overview ........................................................................................................... 79
5.4.3
Special Considerations for Manual Transfers ........................................................... 86
5.5 Transfer Examples – CBRS Asset and Tax Lot Records................................................... 89
5.5.1
Average Cost ...................................................................................................... 90
5.5.2. Gifted Shares for FIFO Account ........................................................................... 103
6
5.5.3
Inherited Shares for FIFO Account ....................................................................... 113
5.5.4
Exception/Correction Processing ......................................................................... 125
Frequently Asked Questions: Transfer Reporting ............................................... 127
Appendix A:
Resource Reference Materials ........................................................... 135
A1
Internal Revenue Code & IRS Information ............................................................... 135
A2
IRS Forms ................................................................................................................ 135
A3
White Paper ............................................................................................................. 135
A4
Information on DTCC’s Cost Basis Reporting Service (CBRS) ................................... 135
Appendix B:
White Paper – Recommended Practices for Firm-Initiated Fund/SERV
Redemptions on Fund-Controlled Accounts ........................................................ 136
B1
ICI White Paper ....................................................................................................... 136
B2
Investment Company Institute Memorandum .......................................................... 146
Appendix C:
Glossary............................................................................................ 149
DTCC CONTROLLED NON-CONFIDENTIAL (GREEN)
Disclaimer
The Cost Basis Reporting Service – Supplemental Users Guide for Mutual Funds (this “Guide”) sets forth
certain information regarding recommended practices and resources that may be useful to firms implementing
cost basis transfer reporting for mutual funds. This Guide was developed by Depository Trust & Clearing
Corporation (“DTCC”) participants and service providers to the mutual fund industry, with the assistance of the
Investment Company Institute and DTCC.
This Guide is not a legal document and the statements contained herein do not set forth any legal obligations
of DTCC, National Securities Clearing Corporation (“NSCC”) or any other DTCC subsidiary, nor do any
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INFORMATION CONTAINED IN THIS GUIDE. FURTHER, NEITHER DTCC NOR ANY OF ITS SUBSIDIARIES
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© DTCC 2011-2013. The Depository Trust & Clearing Corporation. All rights reserved.
DTCC CONTROLLED NON-CONFIDENTIAL (GREEN)
October 25, 2013 – Changes effective November 18, 2013 in accordance
with Important Notice A7665 (posted July 3/2013) and Important Notice
A7702 (posted September 16, 2013)
December 7, 2012 - Changes effective February 4, 2013 in accordance
with Important Notice A7472 (posted August 16, 2012)
December 13, 2011 – Changes effective December 5, 2011 in accordance
with Important Notice A7256 (posted on July 29, 2011)
May 10, 2011 – Initial Publication.
DTCC CONTROLLED NON-CONFIDENTIAL (GREEN)
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
1
Executive Summary
The Emergency Economic Stabilization Act of 2008 was signed into law on October 3, 2008, which includes
provisions from the Energy Improvement and Extension Act of 2008 that requires brokers to provide cost
basis reporting for securities. The Internal Revenue Service (“IRS”) and Treasury Department released
final regulations for implementing cost basis and other information reporting requirements on October 12,
2010. 1
0F
The purpose of the new requirements is to ensure that investors accurately report gains and losses of
applicable securities in their annual tax filings with the IRS. Under the new regulations, brokers, banks,
transfer agents, mutual funds and custodians are required to report adjusted cost basis, gross proceeds,
and the holding period of disposed securities (short-term or long-term) to the IRS and investors. The new
requirements apply to “covered securities,” as defined by the IRS, and will be phased in over a three-year
period beginning on January 1, 2011. The regulations also require that cost basis transfer reporting
statements must be sent for assets of covered security types. The transfer reporting requirements are
effective for transfers of covered mutual fund securities beginning on or after January 1, 2012.
As a result of the legislation and final regulations, the new cost basis reporting regime includes enhanced
requirements for average cost, specific identification, wash sales, corporate actions, and gifted and
inherited shares. The accurate calculation of adjusted basis for the various methodologies must be
supported by firms who are subject to the new reporting requirements.
One of the most significant new requirements under the legislation is the new transfer reporting rules.
Accurate basis information must be sent on transfer reporting statements when assets are moved to
another firm for both full and partial transfers, within 15 days of when a transfer takes place. 2
1F
Additionally, receiving firms are required to request basis if it is not received within 15 days. If basis is
still not received after such request, the shares transferred will be considered “non-covered.”
Late or corrected transfer statements may require receiving firms to make adjustments to cost basis for
investors. Post transfer adjustments (that could result from transaction corrections or corporate actions
such as returns of capital) may require firms to send corrected transfer statements, which in turn will
require receiving firms to make adjustments to cost basis records. These types of activities also may
1
Specific details regarding the legislation, regulations, and revised reporting forms may found in the Resource
References contained in Appendix A.
2
Under the final regulations, a transfer statement must include: (i) the date the statement is furnished; (ii) the name,
address and telephone number of the applicable person furnishing the statement; (iii) the name, address and telephone
number of the broker receiving custody of the security; (iv) the name and account number of the customer(s) for the
account from which the security is transferred and, if different, the name and account number of the customer(s) for
the account to which the security is transferred; (v) the Committee on Uniform Security Identification Procedures
(CUSIP) number of the security transferred; (vi)the date the transfer was initiated and the settlement date of the
transfer (if known), and (vii) the total adjusted basis of the security, the original acquisition date of the security, and, if
applicable, any holding period adjustment required due to a wash sale. As provided in the proposed regulations, the
person furnishing the transfer statement and the receiving broker may agree to combine this information in any format
or to use a code in place of one or more required items.
EXECUTIVE SUMMARY > 1
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
require amendments to Forms 1099 previously reported to the IRS and investors 3. Given the large
2F
volumes of transfers that occur between firms today, standardization and automation is necessary to
achieve operational efficiencies and assist firms in meeting their compliance obligations for transfer
reporting under the new rules. A lack of automation and use of manual transfer statements may be both
costly and inefficient for both sending and receiving firms.
In order to assist firms in complying with the new transfer reporting requirements, the Depository Trust
and Clearing Corporation (DTCC) has enhanced its Cost Basis Reporting Service (CBRS). 4 DTCC initially
3F
launched CBRS in 2003 to enable broker-dealer and bank participant firms to pass cost basis on assets
transferred via DTCC’s Automated Customer Account Transfer Service (ACATS). Prior to 2011, the CBRS
service was utilized voluntarily by many ACATS participants. With the passage of cost basis legislation, the
industry, including mutual funds, embraced the need for a system that would provide a centralized
communications hub that would mitigate risk and promote standardization in order to meet their
regulatory requirements in an efficient and cost effective manner.
In response to the needs expressed by the industry, DTCC established a cross functional committee with
members from different segments of the industry, who played a key role in defining the new system’s
functionality and record layouts in order to help financial intermediaries that are reporting brokers comply
with the new cost basis transfer reporting regulations. The new version of the system extends the
efficiencies and capabilities of CBRS to transfer agents, issuers, mutual funds, custodian banks and
broker-dealers in order to move cost basis information from one financial firm to another in a
standardized, automated, and timely fashion in a secure environment. 5 The new service was launched in
4F
2010 and will continue to be enhanced to meet the needs of the industry as it begins complying with the
new cost basis reporting rules.
Because mutual funds have unique attributes that must be considered when transferring cost basis
information, a separate industry task force was formed in 2009 to develop a mutual fund user’s guide to
augment DTCC’s CBRS User Guide, which is applicable to all security types. 6 This supplemental guide was
5F
created to encourage standardization and automation and contains recommended practices and resources
that may be useful to firms implementing cost basis transfer reporting for mutual funds. The mutual fund
guide is organized to address special considerations and recommended practices for mutual fund transfers
and includes information on: lot depletion, average cost specific rules, transfer statement corrections, inkind retirement distributions, the role of agents in cost basis transfers and recommended practices for
firm-initiated Fund/SERV 7 redemptions in fund-controlled accounts. The guide also provides annotated
6F
record layouts for mutual funds and related best practices, frequently asked questions about mutual fund
3
Final regulations require brokers to report adjustments to cost basis. Corrected Transfer Reporting is required when
an adjustment is made within 18 months following settlement of the original transfer. Corrected IRS and shareholder
1099-B reporting is required when adjustment is made within 3 years following settlement of the original transfer.
4
DTCC operates its businesses through several operating subsidiaries.
5
CBRS does not tell users what transactions trigger the need to pass cost basis or when to send basis, nor does it
calculate or provide any reconciliation capabilities between expected and received records.
6
Further information on the DTCC’s CBRS documentation may be found in the Resource References in Appendix A.
7
Fund/SERV is a service offered by National Securities Clearing Corporation (“NSCC”), a subsidiary of DTCC.
EXECUTIVE SUMMARY > 2
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
transfers and transfer statements, a glossary of key terms and a resource listing of helpful information to
assist reporting brokers for mutual funds.
The guide was updated in December of 2011. Additional information, including examples and
recommended practices, with respect to transfer reporting in the context of ACATS and ACATSFund/SERV, Networking transactions 8, and leveraging CBRS for manual transfers have been incorporated
7F
in the guide. Updates to recommended industry practices in response to recently issued IRS guidance 9
8F
have also been included.
The guide was further updated in November of 2012 in accordance with Important Notice A7472.
The complexities of calculating accurate basis information and the new transfer reporting requirements will
present many implementation challenges for the industry in the years to come. This supplemental guide is
intended to assist both business and systems personnel and service providers tasked with implementing
the new cost basis rules for mutual funds.
8
ACATS, ACATS-Fund/SERV and Networking are services offered by NSCC, a subsidiary of DTCC.
9
The Internal Revenue Service issued Notice 2011-56, which provides interim guidance on certain issues relating to
cost basis reporting. The notice can be found on the IRS’s website at http://www.irs.gov/pub/irs-drop/n-11-56.pdf.
EXECUTIVE SUMMARY > 3
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
2
Introduction and Background
This guide is current as of the date of publication. It is anticipated that, throughout the Cost Basis Reporting
implementation process, this guide will go through numerous revisions as additional recommended practices,
revised usage expectations, and further regulatory clarifications are received. Those using the manual are
encouraged to check the DTCC Website, www.dtcc.com, frequently for any updates.
In early 2009, the Investment Company Institute (ICI), through its Broker/Dealer Advisory Committee
(BDAC), brought together an industry Cost Basis Reporting (CBR) task force (the BDAC CBR Task Force,
or “Task Force”) consisting of DTCC, fund families, broker-dealers, and service providers to address the
requirement to transfer cost basis information associated with transfers of shares between tax reporting
brokers. The Task Force has worked non-stop to address the many issues associated with the new
requirement, which is just one of the many changes the industry is tasked with implementing under the
new basis reporting regime.
The Task Force has worked in conjunction with two other ICI task forces on implementing cost basis
reporting for mutual funds —those sponsored by the ICI Tax Committee and the ICI Transfer Agency
Advisory Committee (TAAC). The Tax Committee has focused its attention on the tax, legal and legislative
processes surrounding mandatory cost basis, while the TAAC task force has addressed the broader
operational and shareholder servicing impacts of integrating mandatory cost basis into fund transfer
agency operations. The BDAC CBR Task Force is grateful for the input provided by these two groups on
the mutual fund transfer reporting initiative and the related documentation.
The guide, which was developed by DTCC participants and service providers to the industry on the Task
Force with the assistance of the ICI and DTCC, focuses on the transfer of cost basis information for mutual
funds between reporting brokers. It is supplemental and should always be used in conjunction with the
DTCC CBRS User Guide, which can be found at:
http://www.dtcc.com/products/documentation/cs/cbrs.php
The supplemental guide includes the following:
•
An Executive Summary, focused on senior-level executives within an organization, which frames
the broad issues and considerations surrounding mandatory cost basis reporting, specific to the
transfer of basis between reporting brokers.
•
An Introduction, providing background and an overview to the materials in this Guide.
INTRODUCTION AND BACKGROUND > 4
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
•
A discussion of Special Considerations and Recommended Practices for Mutual Funds,
which presents an overview of some of the major issues and considerations impacting cost basis
transfer statements. Issues covered include:
•
o
Lot depletion methodology and its impact on transfers;
o
Average cost-specific rules which affect transfer statement options;
o
Transfer statement correction scenarios and considerations;
o
In-kind retirement distributions;
o
Firm-initiated redemptions on fund-controlled accounts;
o
Networking changes that impact cost basis reporting responsibilities; and
o
The role of agents in cost basis transfers.
Annotated Asset and Tax Lot Records for DTCC’s Cost Basis Reporting Service (CBRS)
specifically focused on select fields that include mutual fund-specific details, recommended
practices, and other considerations.
•
A discussion of Mutual Fund Transfer Processing and CBRS. This section provides an overview
on transfers of mutual fund securities and covers (1) ACATS and ACATS-Fund/SERV, (2)
Networking, and (3) manual transfer scenarios that should invoke a cost basis transfer reporting
statement. A detailed description and processing workflows are provided for each transfer type,
as well as special considerations and recommended practices. This section also includes examples
that identify key fields and values for the various transfer types for Cost Basis reporting purposes
that should be utilized when populating the CBRS record layouts.
•
Frequently Asked Questions (FAQs) about mutual fund transfers and transfer statements.
•
Resource Reference Materials that include helpful information to assist reporting brokers in the
Mutual Fund space in implementing mandatory cost basis reporting, including the generation of
transfer statements.
•
A copy of the Industry white paper, “Firm-Initiated Fund/SERV Redemptions on FundControlled Accounts”, which details a necessary shift in tax reporting responsibilities brought
about by mandatory cost basis reporting.

A Glossary of key terms used in the context of cost basis transfers between reporting brokers.
The guide will continue to be revised and updated as industry recommended practices emerge, or IRS
guidance is received (as applicable).
INTRODUCTION AND BACKGROUND > 5
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
3
Special Considerations and Recommended Practices for
Mutual Funds
The transfer reporting requirement has many complexities that may impact its successful execution.
Through its work, the Task Force has identified a number of issues that will impact the mutual fund
transfer reporting process. The following special considerations are addressed in this chapter:
•
Lot depletion methodology and its impact on transfers;
•
Average cost-specific rules which affect transfer statement reporting;
•
Transfer statement correction scenarios and considerations;
•
In-kind retirement distributions;
•
Firm-initiated redemptions on fund-controlled accounts;
•
Networking changes that impact cost basis reporting responsibilities; and
•
The role of agents in cost basis transfers.
For each issue identified above, an overview of the topic will be presented, along with any industry
recommended practices, business decisions or considerations that should be undertaken prior to January
1, 2012, the effective date for the mandatory cost basis reporting for mutual funds.
The Task Force spent considerable time analyzing and discussing the recommended practices for reporting
brokers when depleting tax lots. While seemingly a firm-by-firm decision, there is some desire to be
consistent across reporting brokers, to minimize questions that could occur when lot depletion activities
vary between reporting brokers for transfer transactions.
For redemptions or transfers absent external instructions, 10 the IRS requirement is that tax lots in an
9F
account, whether covered or non-covered,
11
10F
are selected based on acquisition date from oldest to newest,
or in first-in/first-out (FIFO) order. The final IRS regulations also clarify that unless the customer
specifically identifies the securities to be sold; the broker must deplete and report the sale of any shares
in the account with unknown acquisition dates first, regardless of the Cost Basis calculation method
employed.

Industry Recommended Practice: Absent shareholder instructions, all unknown shares should be
depleted first followed by (i) the earliest non-covered shares acquired first (FIFO), then (ii) the earliest
covered shares acquired first (FIFO).
10
The most common external instruction received is some form of proportional movement of tax lots, which often
occurs when shares are being transferred into a new legal ownership arrangement (registration), such as in response to
an inheritance or divorce.
11
Covered and non-covered shares are treated (“deemed”) as two separate accounts for cost basis reporting purposes.
SPECIAL CONSIDERATIONS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 6
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
The Task Force recommendation is consistent with the IRS’ long-term goal of matching cost basis reported
by shareholders and reporting brokers.
Although the regulations provide that FIFO applies on an account-by-account basis, a shareholder may
have non-covered shares with an acquisition date that is later than the acquisition date of covered shares.
Thus an alternative practice may be to deplete non-covered and covered shares on a combined FIFO
basis, even though the shares are in two deemed-separate accounts for cost basis reporting purposes.
The average cost method has some unique considerations with regard to the cost basis information
provided by the delivering reporting broker when transferring shares. Some questions in this area are left
to interpretation, as the final regulations do not specifically address certain issues. The industry is tasked
with striking a balance that will ensure compliance with the final regulations, but will also provide
shareholders the maximum flexibility in utilizing cost basis methodologies availed to them for tax reporting
purposes.
3.2.1 Average Cost – Broker Default Method & Changes
Final IRS regulations permit reporting brokers (funds and firms) to select average cost as their default
calculation method for mutual funds. In this situation, shareholders have two options for managing their
accounts, which can impact how cost basis information must be provided when transferring shares:
Prospective Change: Shareholders may change prospectively at any time from the average cost
default, if desired, by notifying their reporting broker in writing of their change in method. All covered
shares acquired prior to the requested change from a broker’s default method of average cost must be
tracked and transferred reflecting the average cost at the time of the shareholder’s change in method.
Change from Broker Default: The mutual fund industry asked the IRS to allow shareholders to choose a
permitted method (e.g., FIFO) other than the broker’s default method of average cost for existing shares
if no redemptions have occurred in the account, rather than applying such a method choice prospectively
only (as was required in the final regulations). Funds and firms thus could allow their customers to
choose any method for all fund shares in an account, up until the first redemption. In response to this
request, the IRS issued additional guidance 12 that permits shareholders to choose a method other than
1F
the broker’s default of average cost under such circumstances. 13
12F
Pursuant to Notice 2011-56, the shareholder must choose another method within one year following the
notification of the reporting broker’s default method, or prior to the date of first sale, transfer, or other
12
The Internal Revenue Service issued Notice 2011-56, which provides interim guidance on certain issues relating to
cost basis reporting. The notice can be found on the IRS’s website at http://www.irs.gov/pub/irs-drop/n-11-56.pdf.
13
The IRS refers to this as a “change in method.”
SPECIAL CONSIDERATIONS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 7
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
disposition of shares subject to the broker default method (the “change in method” period). Brokers at
their discretion may extend this period longer than one year, but not beyond the first redemption.

If a shareholder chooses another method for an account other than average cost prior to transfer,
the basis in the shares to which the method choice applies is the basis before averaging. Thus, if a
transfer were to occur after the change, individual cost basis for the applicable share lots would be
transferred.
•
When the period for choosing another basis method ends for any qualifying reason, all covered
shares acquired prior to the end of the change period must be tracked and transferred reflecting
the average cost.
•
Shareholders also may request a change in writing from their average cost basis method
prospectively at any time (including after the end of the “change in method” period). If a transfer
subsequently occurs, the delivering broker will send lot information that was calculated using two
different basis methods:
o
Those valued using the average cost basis calculated prior to the change from average
cost,
o
Those valued as individual share lots acquired after the change from average cost.
For scenarios in which there is a request for a full or partial transfer of shares between reporting brokers
involving accounts with identical or like registrations (an “in-kind” transfer), where the “change in
method” period is still open (e.g., there has been no disposition of shares or “change in method” request
prior to transfer), there are two prevailing interpretations 14 that reporting brokers are utilizing in
13F
determining the basis information to be transferred:
•
Certain reporting brokers are treating the transfer of the shares to another reporting broker as a
“disposition of shares,” which terminates the “change in method” period. In this scenario, covered
shares are valued at average cost and then transferred.
•
Other reporting brokers are not treating the in-kind transfer as a disposition because it is not a
change in ownership, but simply a change in reporting broker. Because there has been no
disposition resulting in a change in ownership, the ”change in method” period is not considered
terminated. These reporting brokers are transferring shares reflecting the adjusted cost basis of
the individual share lots, and not the average cost basis. Under this approach, the shareholder
retains the greatest flexibility in managing their cost basis options for the shares transferred into
the new account at the receiving reporting broker.
14
These scenarios are based on different interpretations of the Cost Basis regulations. Unless the IRS issues guidance
on this matter, the industry’s approach will be guided by individual business decisions. Such decisions will be based on
interpretations of the regulations, and other operational and legal considerations.
SPECIAL CONSIDERATIONS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 8
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
3.2.2 Average Cost – Affirmative Election & Revocations
Once a shareholder affirmatively elects average cost, they have the ability to revoke, in writing, this
election. The revocation period is in effect for the earlier of one year following the date of the affirmative
average cost election, or the date of first sale, transfer, or disposition of those shares following the
election. Brokers at their discretion may extend the revocation period longer than one year, but not
beyond the first redemption.
•
If a shareholder revokes their affirmative average cost election in an account prior to transfer, the
basis in the shares to which the revocation applies is the basis before averaging. Thus if a transfer
were to occur after revocation, individual cost basis for the applicable share lots would be
transferred.
•
When a revocation period ends, all covered shares acquired prior to the end of the revocation
period must be tracked and transferred reflecting the average cost.
•
Shareholders also may request a change in writing from their average cost basis method
prospectively at any time (including after the end of a revocation period). If a transfer
subsequently occurs, the delivering broker will send lot information that was calculated using two
different basis methods:
o
Those valued using the average cost basis calculated prior to the change from average
cost,
o
Those valued as individual share lots acquired after the change from average cost.
For scenarios in which there is a request for a full or partial transfer of shares between reporting brokers
involving accounts with identical or like registrations (an “in-kind” transfer), where the revocation period is
still open (e.g., there has been no disposition of shares or requests to change methods prior to transfer),
the same prevailing interpretations discussed above in Section 3.2.1 are utilized in determining the basis
of information to be transferred.
3.2.3 Partial Average Cost Transfers of Like Registration under Broker Default and/or
Affirmative Election
The final cost basis regulations require that except as provided under the computation of the average cost
basis (where shares sold or transferred are deemed to be the shares first acquired, and thus are depleted
in FIFO order) a transfer statement of less than an entire position in an account (partial transfer), absent
a shareholder’s timely identification of the shares to be transferred, are depleted unknown acquisition date
first, followed by the earliest shares acquired FIFO in the account.
Where a partial transfer of like or identical registration occurs and average cost has been affirmatively
elected by the shareholder or is the broker’s default method and the shareholder is currently within the
revocation or “change in method” period, respectively, there are two possible methods for determining
which basis information to transfer. As with full transfers, certain reporting brokers are treating the
partial transfer as a “disposition of shares” that terminates the revocation / “change in method” period.
SPECIAL CONSIDERATIONS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 9
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Therefore, those brokers are sending basis information using the average cost determined on the whole
account before the partial transfer. Alternatively, other brokers are not treating a partial transfer of like
registration as a disposition that ends the revocation / “change in method” period. Thus, these brokers
are sending the adjusted cost basis of the individual share lots, rather than the average cost.
It was suggested that for partial share transfers of like registration a reporting broker could include both
the average cost and adjusted original cost of each individual tax lot on transfer reporting statements, so
receiving brokers can decide which basis information to use. Unfortunately, this is not a workable solution
because the average cost number on the delivered shares is impacted by the cost basis of the shares not
transferred. Thus, it is highly likely that a cost basis ‘out of balance’ situation would result for the
shareholder if the same cost basis methodology was not applied by both the delivering and receiving
reporting brokers when valuing partial transfers.
3.2.4 Single-Account Average Cost Transfers
Once average cost is affirmatively elected by the shareholder the reporting broker has, at its discretion,
the option of utilizing the “Single Account” cost basis method. This means that all shares in an account,
regardless of acquisition date, will be considered covered for reporting and included in the average cost
calculation. The Single Account election can only be “unwound” by a shareholder’s written revocation of
average cost, which would follow the revocation guidelines outlined in Section 3.2.2 above.
If an account under single-account average cost is fully or partially transferred to a like registration while
shares are within their revocation period (meaning no disposition of shares has occurred and the time
threshold has not been met), the reporting broker must value all shares transferred under the singleaccount average cost. This is because the reporting broker’s single account election is irrevocable by the
broker and can only be “unwound” by a shareholder revocation of average cost. Without shareholder
revocation, there is no option to send the adjusted basis of individual shares.
Despite all best intentions, there will inevitably be a need to correct information sent in a transfer
statement. Such need may result from processing errors on the originating account, ensuing tax lot
information received that impacts a previously-generated transfer statement, or due to a corporate action
such as a return of capital, which adjusts cost basis.

Required Practice: In all instances, the reporting broker in possession of the shares on the effective
date of a correction is responsible for correcting the cost basis and sending updated transfer statements.
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Like original processing, a reporting broker has 15 calendar days to forward corrected transfer statements,
once the reporting broker is made aware they have received updated information. This obligation exists,
based on final IRS regulations, for 18 months following the settlement date of the original transfer
transaction.
3.3.1 Processing Error Adjustment
An example of an adjustment originated by a processing error would be a transaction that should have
been processed prior to a transfer to a new reporting broker, resulting in a different share amount
transferred. The submitting reporting broker would be required to send updated information to correct
the transaction itself, plus the corresponding corrected transfer statement.

Required Practice: Reporting brokers must send sufficient details to tie the corrective processing to the
original transaction. The receiving reporting broker must update both the record-keeping and tax lot
systems with the corrective transaction information.
Transfer Corrections When Share Quantity Decreases through Correction
Members of the Task Force analyzed the ramifications of transfer statement corrections for various cost
basis reporting scenarios. As a result, the Task Force adopted a recommended practice of fully cancelling
(voiding, reversing) the original transaction, and replacing it with a new transaction for the correct share
amount. The transaction cancellation should reinstate the tax lots with the original delivering broker, and
remove the related tax lots from the original receiving broker’s records; as if the original transfer
transaction never occurred. Neither reporting broker should generate or expect to receive a
corrected cost basis transfer statement as a result of the cancellation transaction.
Upon reprocessing the transfer transaction for the correct amount, a new transfer statement requirement
is invoked and cost basis would be processed and reported for the correct share request.

Industry Recommended Practice: Industry recommended practice when correcting a transfer
transaction is to cancel the original transfer transaction and deliver a (to and from) transfer cancelation
using the Networking F55 Activity record utilizing the appropriate Transfer Cancelation transaction types.
The original transaction is then voided by both parties, any impact from previously-exchanged CBRS
records are deleted from both the delivering and receiving entities’ cost basis systems, and a subsequent
new transfer transaction and related CBRS records are transmitted.
This recommended practice applies to cancellations/corrections which affect all or a portion of the original
transfer and related cost basis records.
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Transfer Corrections When Share Quantity Increases through Correction
When the number of transferred shares should be greater than the amount received as a result of an
adjustment or corrective action, the party initiating the transfer may choose to initiate a second
(separate) transfer for the omitted shares. Conversely, the aforementioned Industry Recommended
Practice can also be followed.
Identifying Transfer Cancellations
For those parties receiving NSCC Networking Activity record F55, transfer cancellations will be identified
by Transaction Types 33 (Transfer From – Cancellation) and 34 (Transfer To – Cancellation). Please refer
to the Networking discussion in the Transfers Section of this guide for more details on these Transaction
Types and how they are used to facilitate processing adjustment transactions as detailed in the Industry
Recommended Practice above.
3.3.2 Updated Tax Lot Information Adjustment
In a multiple-reporting broker transfer, and because tax lot information may lag actual transaction
processing by one or more days, it is possible that a reporting broker may have to transfer “pending cost
basis” tax lots as part of a transfer statement.
For example, Reporting Broker A is in the process of submitting a transfer statement to Reporting Broker
B, when Reporting Broker B must submit a transfer statement covering the same shares that may have
subsequently been transferred to Reporting Broker C.
Depending on how Reporting Broker B approaches
the situation, it may elect to send a transfer statement with “pending cost basis” noted. Once Reporting
Broker A provides the final cost basis information to Reporting Broker B, Reporting Broker B generates a
corrected transfer statement – with updated cost basis information – for Reporting Broker C.
Final IRS regulations permit 15 calendar days following transfer settlement for delivery of the transfer
statement.

Industry Recommended Practice: Reporting brokers should send available tax lot information in a
transfer statement as soon as practicable and follow-up with any corrected or adjusted transfer
statements for any pending cost basis information.
Waiting to send the transfer statement until pending cost basis is received may risk a delayed delivery of
the transfer statement beyond 15 calendar days, which would cause the submitting reporting broker to be
out of compliance with transfer reporting requirements, and would unnecessarily trigger a transfer
statement request from the receiving reporting broker.
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3.3.3 Corporate Action Adjustment
There are certain fund events, such as returns of capital, which impact an account’s cost basis. Often,
these declarations are made weeks or months after they are actually effective.
The reporting broker holding shares as of the effective date of the corporate action – regardless of the
calendar date the corporate action is announced – is responsible for adjusting the cost basis of the
affected tax lots and issuing a corrected transfer statement, in the event those shares were transferred to
another reporting broker.
In some unique situations, mutual fund shares can be transferred in-kind from a retirement account into a
non-retirement account. When this occurs, final IRS regulations require that a transfer statement be sent
to the receiving broker indicating that all shares transferred are non-covered for cost basis purposes.
This situation is especially problematic for most mutual fund companies because the cost basis reporting
system is not linked to retirement accounts – which by statute are otherwise exempt from the cost basis
reporting requirements. The submitting reporting broker must somehow generate a transfer statement,
regardless of whether this is done systematically or manually. Likewise, the receiving reporting broker
must follow the requirement to request a transfer statement if not received within 15 calendar days.
However, if the reporting broker processes the corresponding retirement distribution by redeeming shares
in the retirement account and purchasing corresponding shares in the non-retirement account at the
receiving firm, this transaction scenario would not be subject to the cost basis transfer reporting
requirement. Based on industry feedback, this is the most common way that mutual fund companies
process such transactions today.

Please note: There is an information reporting impact to the broker and shareholder for the scenario
above. A purchase into the non-retirement account would create covered shares for the reporting broker
and shareholder; whereas the in-kind transaction would allow the shares transferred to continue to be
non-covered securities for 1099 reporting purposes. However, shareholders are still required to accurately
report their basis in securities moved to a non-retirement account, regardless of whether the securities
transferred are non-covered or covered for information reporting purposes.
Prior to mandatory cost basis reporting, the industry followed a long-standing practice with regard to
reporting gross proceeds from redemptions on fund-controlled accounts. If a firm initiated the redemption
on a fund-controlled account, the firm assumed tax reporting responsibilities for the redemption.
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
Industry Recommended Practice: All required tax reporting completed on “fund-controlled” mutual
fund accounts shall become the responsibility of the fund, as of January 1, 2012.
The white paper entitled, “Firm-Initiated Fund/SERV Redemptions on Fund-Controlled Accounts” is
provided in Appendix B of this document. The white paper provides detailed information on the basis for
this recommended practice and identifies areas where reporting brokers should review and remediate
operational and legal arrangements that may be impacted by implementing the new recommended
practice.
The primary reason for this change in practice is due to the impracticalities of retaining the former
recommended practice of splitting Form 1099-B tax reporting on a given account. Since the cost basis
reporting must accompany gross proceeds reporting, retaining the former recommended practice would
require coordinated and/or dual tax lot tracking by firms and funds involved in the transactions. Extensive
and costly enhancements would be required for Fund/SERV identification of specific lot transactions
which, given the low volumes of these types of transactions, was not warranted or supported by industry
participants.
Firms may still initiate redemption activity against a fund-controlled account. Cost Basis lot depletion will
be driven by the shareholder’s elected calculation method on the fund account, or, in the absence of an
affirmative election, the fund’s default cost basis calculation method. Funds will report the gross proceeds
and corresponding cost basis information for such transactions.
It should be noted that the IRS recognizes both the firm and fund as entities with broker reporting
responsibilities in this situation and permits either to report the activity. The nature of the recommended
practice is to consolidate reporting broker responsibility, in this limited scenario, from the firm to the fund.
SPECIAL CONSIDERATIONS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 14
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Within NSCC’s Networking service, there is a capability for a Networking Maintenance B51 record to be
sent to the fund which changes the Networking Matrix Level on an existing account. Any change from
Matrix Level 3 or Trust-Networked Level 0—to Matrix Level 4 or Non-Networked Matrix 0 (or vice versa)
also changes the party that is responsible for cost basis tracking and 1099 reporting for the account.

Industry Recommended Practice: NSCC’s Networking service provides functionality that enables a
Networking Maintenance B51 record to process a matrix level change on an account held at the fund.
In some cases the B51 Maintenance requested changes the control of the account and the tax
reporting responsibility. Therefore, any networking maintenance change on an account that would
change the existing tax reporting responsibility on mutual fund shares should be processed through a
transfer transaction and not by utilizing the Networking Maintenance B51 record.
The B51 Matrix Level change which changes tax reporting responsibilities creates issues in that there is no
transfer transaction with which to associate the CBRS transfer statement. Likewise, other than a clerical
transaction, there is no transaction-based audit trail to track the transfer. Finally, most fund systems
strive to retain clarity about the responsible party for an account’s tax reporting for the entire year. The
broker/dealer is responsible for the tax reporting while the account is held in a firm-controlled Matrix
Level, and the intra-year Matrix Level change can create tax reporting (and related cost basis reporting)
challenges for the year in question by blending reportable and non-reportable activity in the same fund
account.
Also within Networking is the “Change of Dealer” function, whereby an existing fund account has its
broker/dealer identifiers updated to a different firm. This may or may not also be accompanied by a
change in Matrix Level (typically between firm-controlled Matrix Level 3 and Trust-Networked Level 0).
This scenario most commonly occurs as a result of a firm merger or when a registered representative
switches the firm to which (s)he is associated.
In these situations, it is incumbent upon the firms involved in the Change of Dealer process to ensure that
cost basis information is transferred for the applicable accounts. In most instances, a fund’s cost basis
reporting responsibilities are not impacted by these types of transactions.
SPECIAL CONSIDERATIONS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 15
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Both Networking and ACATS accommodate for the use of an agent to facilitate processing on behalf of an
originating or introducing party 15.
14F

In Networking, the Agent for Firm field is a field defined by the Clearing Firm to represent the
originating or introducing firm. The values found in this field are not assigned by NSCC.

In ACATS, the identification of an MF Agent is less straightforward, due to the translation for
certain business relationships when converting the ACATS transfer record into an ACATSFund/SERV 018 record. The MF Agent is represented as the firm on the order, not the underlying
or introducing firm.
Regardless of how the agent relationship is designated, final IRS regulations clarify that an agent for
trading purposes does not have like-responsibilities for moving cost basis information between reporting
brokers. In other words, the cost basis transfer should move outside the agent, when possible, when
passing between reporting brokers.
Within Networking, there are no NSCC-defined fields to specifically identify an agent (e.g. NSCC Firm
Number). Therefore, with a Networking transfer (B52), the Clearing Firm number on the record will be
used to identify the firm entity that should receive or send the cost basis information on a transfer
statement. It ignores the Agent for Firm reference entirely, because the Agent for Firm field value, by
definition, represents an undefined value for identifying the originating or introducing firm in the context
of Cost Basis transfers. 16 This approach will cause the transfer statement to be directed by the Clearing
15 F
Firm to the introducing firm.
With ACATS, the fields “Originating Delivering Firm Number” and “Originating Receiving Firm Number”
(which correspond to the existing ACATS PTF/TI fields of the same name)—when populated—should be
used to identify the contra-parties when generating transfer statements. Otherwise, the transfer
statement should be directed to the “Firm Number” on the ACATS or ACATS-Fund/SERV transaction.
15
An Agent in this context is defined as a third-party who serves as a trading conduit for an introducing firm. For
instance, Firm A utilizes Agent B to receive its mutual fund orders and to transmit them through NSCC to Fund
Company C for processing. Fund Company C’s responses are transmitted back through NSCC, received by Agent B and
then delivered by Agent B to Firm A.
16
In some instances, Clearing Firms may pass a value in the Agent for Firm field that is equivalent to an NSCC
participant number. This is not universal nor is it a required use of the field.
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4
Annotated CBRS Record Layouts and Recommended
Practices for Mutual Funds
The Cost Basis Reporting Service (CBRS) is a DTCC 17 product used to facilitate the exchange of tax lot
16F
information when investor assets are transferred between tax reporting brokers. Originally developed as
a companion product to DTCC’s ACATS (Automated Customer Account Transfer Service), 18 CBRS has
17F
been expanded to support the passage of cost basis on other transfer types,—for example ACATSFund/SERV, Networking, 19 and with manual transfers. Like other DTCC services, and to the benefit of the
18F
industry and investors, CBRS provides an automated, efficient and cost effective process for transferring
cost basis information.
CBRS participants access the service in one of two methods: through automated file transmissions, or
through DTCC’s WebDirect 20 product. Please refer to the DTCC website, www.dtcc.com, for in-depth
19F
information on CBRS, including a comprehensive User Guide, details on how to sign up for the service, and
other important information about its use in either a file-based or web-based manner.

Industry Recommended Practice: All Mutual Fund reporting brokers should adopt CBRS as the sole
means of moving Cost Basis information between reporting brokers.
Because CBRS supports passing cost basis for many types of asset transfers, the ICI BDAC Cost Basis
Reporting Task Force (the Task Force) developed an annotated CBRS Asset record and a Tax Lot record
which includes specific details for mutual funds. Each field that is pertinent to mutual funds is noted,
along with instructions on how each field should be used.
Please note that the DTCC CBRS User Guide serves as the primary document governing the use
of CBRS and must be consulted for additional details regarding the basic use of the CBRS
system.
17
DTCC operates its businesses through several operating subsidiaries.
18
ACATS is a National Securities Clearing Corporation (“NSCC”) service. NSCC is a wholly-owned subsidiary of DTCC.
19
ACATS-Fund/SERV is an NSCC service supporting the transfer of investor accounts. Networking is an NSCC service
that supports the transfer of account information such as account share balances.
20
WebDirect is a secure, web-enabled portal offered by DTCC, on behalf of its subsidiaries, which allows organizations
that may not be able to support automated file transmissions to benefit from a file-based upload or download of CBRS
information.
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The following information supplements the DTCC CBRS User Guide and is designed to assist the mutual
fund user community in the implementation of CBRS. The information is presented primarily from the
perspective of a reporting broker submitting an “original” or “corrected” asset and tax lot record. “Reject”
and “request” actions use a sub-set of this information when compared to “original” and “corrected”
submissions; the differences are outlined in the DTCC CBRS User Guide.
Listed below is explanatory information about certain fields and their general usage in the context of
Mutual Funds:

Submitting Firm Number will always refer to the firm submitting the CBRS record. Stated
differently, the party creating the CBRS file to deliver a record is the Submitting Firm.

Contra Firm Number will always refer to the firm receiving the CBRS record. Stated differently,
the party receiving a CBRS record is the Contra Firm.

Record Content Indicator defines the type of information represented by the record. Both 01 =
Original and 02 = Corrected are created and provided by the reporting broker managing the
“transfer-out” side of the transaction (“Asset Deliverer”) and will represent the actual Cost Basis
information (Asset and Tax Lot(s) Records) corresponding to the transaction.
The 03 = Firm Reject and 04 = Request records are created and provided by the reporting
broker managing the “transfer-in” side of the transaction (“Asset Receiver”) and are only sent
when records are not received from the Asset Deliverer (in the case of 04 = Request) or are in
some way unusable (in the case of 03 = Firm Reject) .
As implied above, the Asset Deliverer (the party delivering the Cost Basis information through
CBRS) and the Asset Receiver (the party receiving the Cost Basis information through CBRS)
change roles depending on the Record Content Indicator value. As a result, the Submitting
Firm Number and Contra Firm Number on the CBRS record also vary by Record Content
Indicator:
Record Content Indicator
CBRS Submitting Firm Number
CBRS Contra Firm Number
Original (01) and Corrected (02)
Asset Deliverer
Asset Receiver
Firm Reject (03) and Request (04)
Asset Receiver
Asset Deliverer
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Example: Colossal Mutual Fund Company, NSCC Participant Number 8819 and CBRS user, transfers
1,250.500 shares to Ginormous Broker/Dealer, NSCC Participant Number 2277 and CBRS user. The
following matrix explains each party’s CBRS role, in the context of CBRS Record Content Indicator.
Record Content Indicator
CBRS Submitting Firm Number
CBRS Contra Firm Number
01 = Original
8819
2277
8819
2277
2277
8819
2277
8819
(Colossal sends Original Cost Basis
Information to Ginormous)
02 = Corrected
(Colossal corrects the Cost Basis
Information previously sent to
Ginormous)
03 = Firm Reject
(Ginormous rejects the Cost Basis
Information sent by Colossal)
04 = Request
(Ginormous requests Cost Basis
Information from Colossal, in
support of the completed transfer)

Transfer Control Number and Alternate Control Number, in the context of Transaction
Type of 57 = Manual Mutual Fund Transfer, are noted to be populated with a mutuallyagreeable identifier between the contra-parties. However, often these transactions are sent by
the Fund through the NSCC Networking Activity File. Contra-parties should populate the CBRS
record with the Control Number used on Record 4, position 23-37 of the Networking F55 record,
and using it for matching purposes.

Industry Recommended Practice: A Manual Mutual Fund Transfer completed in response to a
failed ACATS-Fund/SERV PTF (Firm to Fund or Fund to Firm transfer) or Networking transaction
should reference the respective Transfer Control Number and Alternate Control Number
provided by the broker/dealer in any manual instructions received to rectify the failed transaction.
Depending on the firm and its system needs, this number may be the ACATS-Fund/SERV or
Networking control number of the failed transaction or some other value. This will facilitate matching
between the contra-parties.
The NSCC Vendor Advisory Group, a consortium comprised of DTCC, mutual fund service providers
and fund families with proprietary mutual fund recordkeeping systems, has worked with
representatives of major brokerage system platforms and proprietary brokerage system owners to
develop a standard algorithm to generate Manual Transfer Control Numbers. A Manual Transfer
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 19
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Control Number will be used by the Fund on any manual transfer where no other Transfer
Control Number has been designated for use. Through use in this manner, transaction activity
and subsequent CBRS information can be easily linked together to fulfill transfer statement
reporting obligations.

Industry Recommended Practice: In the absence of instructions to the contrary, all manual transfers
processed by the Fund should reference a Manual Transfer Control Number derived using the following
algorithm:
Position 1:
‘D’ = Direct Transfer Indicator
Position 2-5:
NSCC Participant Number for the Fund
Position 6:
Last Digit of Current Year
Position 7-9:
Julian Date
Position 10-15:
Unique Number (randomly-generated, sequential)
This number should be provided as the Control Number on Record 4, Position 23-37 of the Networking F55
record, plus as the Transfer Control Number for all related CBRS records.

Contra Firm Number and Contra Firm Type must be confirmed by the CBRS User Master File
(Autoroute Product ID 0256166)—updated and distributed daily by DTCC. This is necessary
because DTCC requires confirmation of the Participant Number AND Firm Type on all CBRS
records. DTCC has overlapping assignments of participant numbers across services of DTCC
subsidiaries. Therefore, DTCC uses both the Firm Number and Firm Type to confirm routing of
CBRS information between contra-parties. Likewise, there are CBRS-only participants that may
need to submit or receive CBRS records; their identification numbers are only available through
the CBRS User Master File and are not found on any corresponding ACATS-Fund/SERV or
Networking transaction. Finally, because CBRS is an optional service, a DTCC participant in
another product (like ACATS-Fund/SERV or Networking) may not participate in CBRS, so
verification before transmission is quite important.
A recommended practice would be to use the respective Participant Numbers from the
corresponding transaction, enriched by the CBRS User Master File guidelines that follow in this
chapter, to search for a match on the CBRS User Master File. Additional validation against the
CBRS User Master File Firm Name field would be a second check, when a match is found. Using
this methodology may not result in a match – that may indicate the firm or fund does not
participate in CBRS, or they are a CBRS-only participant and are instead identified by the CBRS
User Account Number field.

Total Position Quantity on the Asset Record is edited by DTCC against the cumulative shares on
the tax lot records, and the quantity can be provided with up to 4 places to the right of the
decimal. Any fractional share amount up to 4 positions to the right of the decimal are accepted.
For example, a transfer of 3.547 shares can be provided as ‘3,5470’ or ‘3,547’ shares, and a
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 20
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transfer of 100.100 shares could be provided as ‘100,1’ shares. (CBRS uses a comma ‘,’ instead
of a decimal ‘.’ when reporting data in the Total Position Quantity field).
Submitting a Total Position Quantity (including the 4 positions to the right of the decimal) that
does not equal exactly the sum of the tax lot records will cause the record to be rejected back to
the submitter.
The CBRS User Master File, listing all eligible CBRS participants, will be updated and provided to CBRS
participants – and/or their agents – on a daily basis. The file contains data which will help the user crossreference information to correctly populate the CBRS Contra Firm Number and Contra Firm Type.
Each CBRS Participant is assigned a CBRS User Account Number. If the user is registered with DTCC
for any service in addition to CBRS, the CBRS User Account Number will be cross-referenced to a Firm
Account Number, Firm Account Type, and Firm Name.
The following guidelines can be helpful in understanding the CBRS User Master File:
1. For mutual fund purposes, if found on the CBRS User Master File the Firm Account Number and
a valid Firm Account Type should be the first choice to use when populating CBRS records.
Example: Participant uses CBRS and other DTCC services. CBRS User Master File contains:
CBRS User Account Number: 12345678
Firm Account Number: 8819
Firm Account Type: NSCPRT
Firm Name: Colossal Mutual Fund Company
Any CBRS records for Colossal Mutual Fund Company should reference ‘8819’ as the Firm Number, and
‘NSCPRT’ as the Firm Type. The CBRS User Account Number is ignored in this situation since Colossal
uses other DTCC services.
2. If a CBRS User Master File record entry does not include a Firm Account Number, any CBRS
records referencing the related participant will require use of the CBRS User Account Number as
the Contra Firm Number, and CBRACT as the Firm Type (in the corresponding field) on any
CBRS records.
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Example: CBRS is the only DTCC service used by the Participant. CBRS User Master File contains:
CBRS User Account Number: 12345678
Firm Account Number:
Firm Account Type: CBRACT
Firm Name: Colossal Mutual Fund Company
Any CBRS records for Colossal Mutual Fund Company should reference ‘12345678’ as the Firm Number,
and ‘CBRACT’ as the Firm Type. The CBRS User Account Number is used because the Firm Account
Number is blank on the master file.
3. Broker/Dealers that are both DTC participants and NSCC Members are always Firm Type DTCPRT.
This value can be used, along with the DTCC Participant Number on ACATS-Fund/SERV and
Networking records, in the primary search of the CBRS User Master File to confirm the
Broker/Dealer is a CBRS participant.
4. Mutual fund families that are NSCC Members are always Firm Type NSCPRT. This value can be
used, along with the DTCC Participant Number on ACATS-Fund/SERV and Networking records, in
the primary search of the CBRS User Master File to confirm the Mutual Fund is a CBRS participant.
5. Trust companies can be either Firm Type DTCPRT or NSCPRT (it depends on whether they are
DTC participants or NSCC Members). These values can be used, along with the DTCC Participant
Number on ACATS-Fund/SERV and Networking records, in the primary search of the CBRS User
Master File to confirm the Trust Company is a CBRS participant.
6. Firm Type AGTNBR is not relevant to Mutual Funds.
7. CBRS record creation / delivery through CBRS should not be attempted if:
a.
The current date is prior to the CBRS Account Start Date for the CBRS participant on the
CBRS User Master File.
b.
The participant cannot be located on the CBRS User Master File
Example: CBRS User Master File contains:
CBRS User Account Number: 12345678
Firm Account Number: 8819
Firm Account Type: AGTNBR
Firm Name: ABC Stock Transfer Agent
In this case, if Colossal Mutual Fund Company was a contra-party to a CBRS transfer, a search of the
CBRS User Master File on their DTCC Participant Number of ‘8819’ would find this record. However,
because this Firm Account Type is ‘AGTNBR’, it does not pertain to Colossal Mutual Fund Company. If this
was the only record found under ‘8819’, the user can safely assume that Colossal Mutual Fund Company
does not participate in CBRS, and the tax lot transfer must be completed through other means.
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 22
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The following elaborates on the mutual fund usage and perspective on key fields comprising the CBRS
Asset Records as of May 2011. Please note that record layouts are subject to change. Please visit
http://www.dtcc.com/products/documentation/cs/cbrs.php for most recent version of the layouts. In no
way should this information be viewed as standalone. Instead it is supplemental to DTCC’s CBRS User
Guide governing the overall usage of CBRS by the financial services industry.
CBRS Asset Record – Elaboration on Select Fields for Mutual Funds 21
20F
FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
Record Content
Record Content Indicator defines the type of information represented by this Asset
Indicator
Record.
Regarding 01 = Original Asset Record.
This record is sent by the Delivering Firm, or the reporting broker that delivers shares as
a result of the transfer.
Regarding 02 = Corrected Asset Record.
This record is sent by the Delivering Firm, or the reporting broker that delivers shares as
a result of the transfer.
When one tax lot is corrected, it is assumed the entire CBRS response requires
correction. For example:
Transfer 1,000.000 shares in three tax lots, as follows:
Tax Lot 1 = 500.000 shares
Tax Lot 2 = 250.000 shares
Tax Lot 3 = 250.000 shares
If details on Tax Lot 3 need to be corrected / resent, all three tax lot records should be
included. Tax Lots 1 and 2 should also be resent, to maintain the integrity of the
relationship between tax lots and transferred shares.
NOTE: At least one (1) corresponding tax lot record must be indicated as Corrected.
Regarding 03 = Firm Reject Record and 04 = Request Record.
These records are sent by the Receiving Firm, or the reporting broker that receives
shares as a result of the transfer.
Records are sent only when necessary and to maintain compliance with regulations.
NOTE: The recommended practice is to not submit a Record Content Indicator 03 =
Firm Reject Record in response to a 04 = Request Record received, even if it
is not applicable to the receiving reporting broker.
21
Please refer to DTCC’s CBRS User Guide for more detail on Asset Record, Required/Optional Field Designations and
Usage.
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Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
CBRS Asset Record – Elaboration on Select Fields for Mutual Funds 21
20F
FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
Transaction Type
Transaction Type identifies the actual DTCC-based or manual transaction that created
the need to transfer cost basis through CBRS.
The only applicable Transaction Types for Mutual Funds are as follows:
46 = Fund to Firm Mutual Fund Transfer (ACATS PTF)
51 = Firm to Fund Mutual Fund Transfer (ACATS PTF)
56 = Networking Transaction
57 = Manual Mutual Fund Transfer
Transfer Control
The Transfer Control Number corresponds to the unique identifier assigned to the
Number
corresponding transaction, either through use of a DTCC product (e.g.: ACATS (ACATSFund/SERV) or Networking) or manually. The number is used by the recipient to link
CBRS information to its corresponding transaction.
If Transaction Type is 46 = Fund to Firm Mutual Fund Transfer or 51 = Firm to
Fund Mutual Fund Transfer; this field is the Fund/SERV Control Number – Position
45-59 (Variable) or Record 1, Position 41-55 (Fixed) on the Fund/SERV 018 record.
ACATS users can find this number in Position 153-163 (Variable) or Record 3, Position 818 (Fixed) of the ACATS Output Fund/SERV Statistics file (SIAC720 – variable; SIAC726
– fixed).
Firms using the Fund/SERV Control Number from the ACATS-Fund/SERV Statistics file
should add the letters “CATS” to the front of it, in order to match the number that Funds
provide in this field.
If transaction type is 56 = Networking Transaction, then the control number is the
Networking Control Number, found in Record 1, Position 14-24 of the Networking
Conversion/Acknowledgement B52/F53 record.
For all other transaction types, 57 = Manual Mutual Fund Transfer; this field is the
control number agreed upon by the contra-parties involved in the original securities
transaction. The Control Number is the same as what is provided on the Networking F55
Activity Record, Record 4, Position 23-37.
In all instances, data should be left-justified and blank-filled in this alpha-numeric field on
the CBRS file.
Alternate Control
The Alternate Control Number, when available, corresponds to an additional unique
Number
identifier assigned to a corresponding transaction, either through use of a DTCC product
or manually. This field comes into play when data is being passed between two different
DTCC products, such as ACATS and ACATS-Fund/SERV.
If Transaction Type 46 = Fund to Firm Mutual Fund Transfer and 51 = Firm to
Fund Mutual Fund Transfer, the ACATS Control Number must be provided in this Field,
found in Position 683-702 (Variable) or Record 8, Position 28-47 (Fixed) of the
Fund/SERV 018 record. It is also found in Position 12-15 (Variable) or Record 1,
Position 8-21 (Fixed) of the ACATS Transfer Input record (Autoroute 36667 – variable;
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 24
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CBRS Asset Record – Elaboration on Select Fields for Mutual Funds 21
20F
FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
Alternate Control
32667 – fixed). If not provided, the record will reject.
Number (cont.)
Data should be left-justified and blank-filled in this alpha-numeric field on the CBRS file.
Contra Firm Number
The Contra Firm Number corresponds to either the Firm Account Number, or, if not
NOTE: This section applies
available, the CBRS User Account Number associated with the entity receiving this
to Record Content
CBRS Asset Record.
Indicator 01
This number should always be obtained through validation against the CBRS User Master
(Original) and Record
File, updated and distributed daily by DTCC.
Content Indicator
The Contra Firm Number is populated based on relationship to the CBRS record itself,
02 (Corrected)
and not the corresponding transaction record. Therefore, the entity receiving the CBRS
record is always considered the receiving firm.
The following fields can come into play in validating against the CBRS User Master File as
to what the Contra Firm Number on the CBRS record should be. In all instances, data
is passed with lead zeros and right-justified:
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
The firm is the recipient of this record.
If populated, Originating Receiver Firm Number – Position 745-748 (Variable) or Record
8, Position 90-93 (Fixed) on the Fund/SERV 018 record – it means an MF Agent is in
use. This can be used to assist with validation against the CBRS User Master File.
ELSE
Firm Number – Position 12-15 (Variable) or Record 1, Position 8-11 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Original Deliverer Number – Positions 49-52 (Variable) or Record 1, Position 45-48
(Fixed) on the ACATS record can be used to assist with validation against the CBRS User
Master File.
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
The fund is the recipient of this record.
Fund Number – Position 24-27 (Variable) or Record 1, Position 20-23 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Original Receiver Number – Position 41-44 (Variable) or Record 1, Position 37-40 (fixed)
on the ACATS record can be used to assist with validation against the CBRS User Master
File.
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 25
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
CBRS Asset Record – Elaboration on Select Fields for Mutual Funds 21
20F
FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
Contra Firm Number
Transaction Type 56 = Networking Transaction
(cont.)
If B52 places Network Level 3, or Trust-Networked Level 0 account assets in a Network
NOTE: This section applies
Level 4 or non-networked account, the fund is the recipient of the CBRS record. If
to Record Content
provided, the Clearing/Settling Fund Number – Position 10-13 on the Networking
Indicator 01
B52/F53 record can be used to assist with validation against the CBRS User Master File.
(Original) and Record
If B52 places Network Level 4 or non-networked account assets in a Network Level 3 or
Content Indicator
Trust-Networked Level 0 account, the firm is the recipient of the CBRS record. The
02 (Corrected)
Clearing/Settling Firm Number – Position 6-9 on the Networking B52/F53 record can be
used to assist with validation against the CBRS User Master File.
Transaction Type 57 = Manual Mutual Fund Transfer
If Network Level 3 or Trust-Networked Level 0 account assets are transferred into a
Network Level 4, or non-networked account, the fund is the recipient of the CBRS record.
If Network Level 4 or non-networked account assets are transferred into a Network Level
3 or Trust-Networked Level 0 account, the firm is the recipient of the CBRS record.
Information on the Manual Transfer instruction will need to be consulted against the
CBRS User Master File to identify the appropriate reference.
Contra Firm Number
The Contra Firm Number corresponds to either the Firm Account Number, or, if not
NOTE: This section applies
available, the CBRS User Account Number associated with the entity receiving this
to Record Content
CBRS Asset Record.
Indicator 03 (Firm
This number should always be obtained through validation against the CBRS User Master
Reject) and Record
File, updated and distributed daily by DTCC.
Content Indicator
The Contra Firm Number is populated based on the relationship to the CBRS record
04 (Request)
itself, and not the corresponding transaction record. Therefore, the entity receiving the
CBRS record is always considered the receiving firm.
The following fields can come into play in validating against the CBRS User Master File as
to what the Contra Firm Number on the CBRS record should be. In all instances, data
is passed with lead zeros and right-justified:
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
The fund is the recipient of this record.
Fund Number – Position 24-27 (Variable) or Record 1, Position 20-23 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Original Receiver Number – Position 41-44 (Variable) or Record 1, Position 37-40 (fixed)
on the ACATS record can be used to assist with validation against the CBRS User Master
File.
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CBRS Asset Record – Elaboration on Select Fields for Mutual Funds 21
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FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
Contra Firm Number
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
(cont.)
The firm is the recipient of this record.
NOTE: This section applies
If populated, Originating Receiver Firm Number – Position 745-748 (Variable) or Record
to Record Content
8, Position 90-93 (Fixed) on the Fund/SERV 018 record – it means an MF Agent is in
Indicator 03 (Firm
use. This can be used to assist with validation against the CBRS User Master File.
Reject) and Record
Content Indicator 04
(Request)
ELSE
Firm Number – Position 12-15 (Variable) or Record 1, Position 8-11 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Original Deliverer Number – Positions 49-52 (Variable) or Record 1, Position 45-48
(Fixed) on the ACATS record can be used to assist with validation against the CBRS User
Master File.
Transaction Type 56 = Networking Transaction
If B52 places Network Level 3 or Trust-Networked Level 0 account assets in a Network
Level 4 or non-networked account, the firm is the recipient of the CBRS record. The
Clearing/Settling Firm Number – Position 6-9 on the Networking B52/F53 record can be
used to assist with validation against the CBRS User Master File.
If B52 places Network Level 4 or non-networked account assets in a Network Level 3 or
Trust-Networked Level 0 account, the fund is the recipient of the CBRS record. If
provided, the Clearing/Settling Fund Number – Position 10-13 on the Networking
B52/F53 record can be used to assist with validation against the CBRS User Master File.
Transaction Type 57 = Manual Mutual Fund Transfer
If Network Level 3 or Trust-Networked Level 0 account assets are transferred into a
Network Level 4 or non-networked account, the firm is the recipient of the CBRS record.
If Network Level 4 or non-networked account assets are transferred into a Network Level
3 or Trust-Networked Level 0 account, the fund is the recipient of the CBRS record.
Information on the Manual Transfer instruction will need to be consulted against the
CBRS User Master File to identify the appropriate reference.
Contra Firm Type
Receiving Firm Type clarifies the type of entity receiving the CBRS record. This is
important because the same participant number can be assigned by DTCC to different
firms across services of DTCC subsidiaries. This type corresponds to the type of number
in the Contra Firm Number field and is obtained from the CBRS User Master File.
Contra Firm Type (cont.)
Values:
AGTNBR = Transfer Agent (not relevant to Mutual Funds)
CBRACT = CBRS-Only User
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 27
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FIELD NAME
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DTCPRT = DTC Participant
NSCPRT = NSCC Participant
Submitting Firm Number
The Submitting Firm Number corresponds to the Firm Account Number, or, if not
NOTE: This section applies
available, the CBRS User Account Number associated with the entity submitting this
to Record Content
CBRS Asset Record.
Indicator 01
This number should always be obtained through validation against the CBRS User Master
(Original) and Record
File, updated and distributed daily by DTCC.
Content Indicator
The Submitting Firm Number is populated based on relationship to the CBRS record
02 (Corrected)
itself, and not the corresponding transaction record. Therefore, the entity submitting the
CBRS record is the submitting firm.
The following fields can come into play in validating against the CBRS User Master File as
to what the Submitting Firm Number on the CBRS record should be. In all instances,
data is passed with lead zeros and right-justified:
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
The fund is the submitter of this record.
Fund Number – Position 24-27 (Variable) or Record 1, Position 20-23 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
The firm is the submitter of this record.
If populated, Originating Receiver Firm Number – Position 745-748 (Variable) or Record
8, Position 90-93 (Fixed) on the Fund/SERV 018 record – it means an MF Agent is in
use. This can be used to assist with validation against the CBRS User Master File.
ELSE
Firm Number – Position 12-15 (Variable) or Record 1, Position 8-11 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Transaction Type 56 = Networking Transaction
If B52 places Network Level 3 or Trust-Networked Level 0 account assets in a Network
Level 4 or non-networked account, the firm is the submitter of the CBRS record. The
Clearing/Settling Firm Number – Position 6-9 on the Networking B52/F53 record can be
used to assist with validation against the CBRS User Master File.
If B52 places Network Level 4 or non-networked account assets in a Network Level 3 or
Trust-Networked Level 0 account, the fund is the submitter of the CBRS record. If
provided, the Clearing/Settling Fund Number – Position 10-13 on the Networking
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 28
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CBRS Asset Record – Elaboration on Select Fields for Mutual Funds 21
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FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
B52/F53 record can be used to assist with validation against the CBRS User Master File.
Submitting Firm Number
Transaction Type 57 = Manual Mutual Fund Transfer
(cont.)
If Network Level 3 or Trust-Networked Level 0 account asset is transferred into a
NOTE: This section applies
Network Level 4, or non-networked account, the firm is the submitter of the CBRS record.
to Record Content
If Network Level 4 or non-networked account asset is transferred into a Network Level 3
Indicator 01 (Original)
or Trust-Networked Level 0 account, the fund is the submitter of the CBRS record.
and Record Content
Indicator 02 (Corrected)
Information on the Manual Transfer instruction will need to be consulted against the
CBRS User Master File to identify the appropriate reference.
Submitting Firm Number
The Submitting Firm Number corresponds to the Firm Account Number, or, if not
NOTE: This section applies
available, the CBRS User Account Number associated with the entity submitting this
to Record Content
CBRS Asset Record.
Indicator 03 (Firm
This number should always be obtained through validation against the CBRS User Master
Reject) and Record
File, updated and distributed daily by DTCC.
Content Indicator
The Submitting Firm Number is populated based on relationship to the CBRS record
04 (Request)
itself, and not the corresponding transaction record. Therefore, the entity submitting the
CBRS record is the submitting firm.
The following fields can come into play in validating against the CBRS User Master File as
to what the Submitting Firm Number on the CBRS record should be. In all instances,
data is passed with lead zeros and right-justified:
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
The firm is the submitter of this record.
If populated, Originating Receiver Firm Number – Position 745-748 (Variable) or Record
8, Position 90-93 (Fixed) on the Fund/SERV 018 record – means an MF Agent is in use.
This can be used to assist with validation against the CBRS User Master File.
ELSE
Firm Number – Position 12-15 (Variable) or Record 1, Position 8-11 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
The fund is the submitter of this record.
Fund Number – Position 24-27 (Variable) or Record 1, Position 20-23 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
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CBRS Asset Record – Elaboration on Select Fields for Mutual Funds 21
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FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
Submitting Firm Number
Transaction Type 56 = Networking Transaction
(cont.)
If B52 places Network Level 3 or Trust-Networked Level 0 account assets in a Network
NOTE: This section applies
Level 4 or non-networked account, the fund is the submitter of the CBRS record. If
to Record Content
provided, the Clearing/Settling Fund Number – Position 10-13 on the Networking
Indicator 03 (Firm
B52/F53 record can be used to assist with validation against the CBRS User Master File.
Reject) and Record
If B52 places Network Level 4 or non-networked account assets in a Network Level 3 or
Content Indicator 04
Trust-Networked Level 0 account, the firm is the submitter of the CBRS record. The
(Request)
Clearing/Settling Firm Number – Position 6-9 on the Networking B52/F53 record can be
used to assist with validation against the CBRS User Master File.
Transaction Type 57 = Manual Mutual Fund Transfer
If Network Level 3 or Trust-Networked Level 0 account asset is transferred into a
Network Level 4, or non-networked account, the fund is the submitter of the CBRS
record.
If Network Level 4 or non-networked account asset is transferred into a Network Level 3
or Trust-Networked Level 0 account, the firm is the submitter of the CBRS record.
Information on the Manual Transfer instruction will need to be consulted against the
CBRS User Master File to identify the appropriate reference.
Submitting Firm Type
Submitting Firm Type clarifies the type of entity sending the CBRS record. This is
important because the same participant number can be assigned by DTCC to different
firms across services of DTCC subsidiaries. This type corresponds to the type of number
in the Submitting Firm Number field.
Values:
AGTNBR = Transfer Agent (not relevant to Mutual Funds)
CBRACT = CBRS User
DTCPRT = DTC Participant
NSCPRT = NSCC Participant
Receiver Customer
The Receiver Customer Account Number identifies the customer’s account to which
Account Number
the CBRS data will be applied. This account number may differ from the BIN (Broker
Identification Number) and may represent an underlying sub-account available to the
firm in question.
Receiver Customer
The Receiver Customer Account Number is ALWAYS populated based on relationship
Account Number (cont.)
to the corresponding transaction record; it ALWAYS references the account that should
receive the cost basis information and is not impacted by the value of the Record
Content Indicator.
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
If populated, Originating Receiver Customer Account Number at Firm – Position 547-566
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(Variable) or Record 6, Position 78-97 (Fixed) on the Fund/SERV 018 record – means an
MF Agent is in use, and this field should be used.
ELSE
Customer Account Number at Firm – Position 572-591 (Variable) or Record 7, Position
10-29 (Fixed) of the Fund/SERV 018 record.
Original Receiver Customer Account Number – Position 53-72 (Variable) or Record 1,
Position 49-68 (Fixed) of the ACATS record.
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
Customer Account Number at Fund – Position 140-159 (Variable) or Record 2, Position
43-62 (Fixed) of the Fund/SERV 018 record.
OR
Original Receiver Customer Account Number – Position 53-72 (Variable) or Record 1,
Position 49-68 (Fixed) of the ACATS Transfer record.
Transaction Type 56 = Networking Transaction
If B52 places Network Level 3 or Trust-Networked Level 0 account assets in a Network 4
or non-networked account, use the Credit Account Number – Record 1, Position 57-76 of
the Networking B52/F53 record, which should reference the Fund’s Account Number.
If B52 places Network Level 4, or non-networked account assets in a Network Level 3, or
Trust-Networked Level 0 account, first use the Credit Sub-Account Number – Record 4,
Position 46-65 of the Networking B52/F53 record. If the Credit Sub-Account Number is
blank, use the Credit Account Number – Record 1, Position 57-76 of the Networking
B52/F53 record, which should reference the Firm’s Account Number.
Transaction Type 57 = Manual Mutual Fund Transfer
If Network Level 3 or Trust-Networked Level 0 account assets are transferred into
Network Level 4, or non-networked account, this field should carry either the Underlying
Customer Account Number or the Fund’s Account Number.
If Network Level 4 or non-networked account assets are transferred into a Network Level
3 or Trust-Networked Level 0 account, this field should carry either the Underlying
Customer Account Number or the Firm’s Account Number.
Deliverer Customer
The Deliverer Customer Account Number identifies the customer’s account from
Account Number
which the CBRS data will be sent. This account number may differ from the BIN (Broker
Identification Number) and may represent an underlying sub-account available to the
firm in question.
The Deliverer Customer Account Number is ALWAYS populated based on relationship
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 31
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CBRS Asset Record – Elaboration on Select Fields for Mutual Funds 21
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FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
to the corresponding transaction record; it ALWAYS references the account from which
cost basis information is sent and is not impacted by the value of the Record Content
Indicator.
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
Customer Account Number at Fund – Position 596-615 (Variable) or Record 7, Position
54-73 (Fixed) of the Fund/SERV 018 record.
OR
Original Deliverer Customer Account Number – Position 173-192 (Variable) or Record 3,
Position 38-57 (Fixed) of the ACATS Transfer record.
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
If populated, Original Deliverer Customer Account Number – Position 177-196 (Variable)
or Record 2, Position 80-99 (Fixed) of the Fund/SERV 018
ELSE
Customer Account Number at Firm – Position 572-591 (Variable) or Record 7, Position
10-29 (Fixed) of the Fund/SERV 018 record.
Original Deliverer Customer Account Number – Position 173-192 (Variable) or Record 3,
Position 38-57 (Fixed) of the ACATS Transfer record.
Transaction Type 56 = Networking Transaction
If B52 places Network Level 3 and Trust-Networked Level 0 account assets in a Network
4 or non-networked account, first use the Debit Sub-Account Number – Record 4,
Position 66-85 of the Networking B52/F53 record. If the Debit Sub-Account Number is
blank, use the Account Number – Record 1, Position 36-55 of the Networking B52/F53
record, which should reference the Firm’s Account Number.
If B52 places Network Level 4, or non-networked account assets in a Network Level 3, or
Trust-Networked Level 0 account, use the Account Number – Record 1, Position 36-55 of
the Networking B52/F53 record, which should reference the Fund’s Account Number for
the transaction.
Deliverer Customer
Transaction Type 57 = Manual Mutual Fund Transfer
Account Number (cont.)
If Network Level 3 or Trust-Networked Level 0 account assets are transferred into a
Network Level 4, or non-networked account, this field should carry either the Underlying
Customer Account Number or the Firm’s Account Number.
If Network Level 4 or non-networked account assets are transferred into a Network Level
3, or Trust-Networked Level 0 account, this field should carry either the Underlying
Customer Account Number or the Fund’s Account Number.
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 32
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CBRS Asset Record – Elaboration on Select Fields for Mutual Funds 21
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FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
ISIN Country Code
Value is US
ISIN Security Issue ID
Security Issue ID (CUSIP) of the Security in question
(CUSIP)
ISIN Security Check
Leave Blank.
Digit
Asset Description
This field should be populated with the same Security Issue ID (CUSIP) Fund Name found
on Mutual Fund Profile, if a participant. Otherwise, field should be populated in a way to
clearly identify the Security Issue ID.
Asset Category
Value is always MFNM
Total Position Quantity
Total shares involved in the transfer should be provided.
NOTE: In the context of Transaction Types 46 = Fund to Firm Mutual Fund
Transfer, 51 = Firm to Fund Mutual Fund Transfer, and 56 = Networking
Transfer, this amount typically should match the corresponding ACATSFund/SERV or Networking B52 transaction amount.
It is feasible that the Total Position Quantity can exceed the transaction amount, in
the instance of an accrued dividend reinvestment/payout on an all-share transfer. Some
systems may retain this amount for distribution at the end of the period; others may
incorporate into the transferred shares sent with the transaction.
Date Transfer was
Leave Blank
Initiated
NOTE: The record layouts state that either Transfer initiation or Settlement Date must
be populated. Because Settlement Date is more relevant to the contra-parties in
a Mutual Fund Transfer, it is used.
Settlement Date of
Populate with the Settlement Date of the Transfer. Format: CCYYMMDD.
Transfer
NOTE: The record layouts state either Transfer initiation or Settlement Date must be
populated. Because Settlement Date is more relevant to the contra-parties in a
Mutual Fund Transfer, it is used.
NOTE: In the context of Mutual Funds, transfers typically have the same initiation and
settlement dates, from a fund’s books and records perspective. Broker/Dealers
may recognize a different Settlement Date than the Fund, because of the
bookkeeping and settlement differences between ACATS and ACATS-Fund/SERV.
Settlement Date of
Therefore, in the context of matching tax lots to a transaction, Settlement Date should
Transfer (cont.)
not be a primary matching field.
Position Code
Value is always ‘L’
Disposition Method Used
Pass this information if the Disposition Method currently used by the shareholder is
applicable to the transferred lots and matches one of the values supported by DTCC’s
CBRS layout, or if the shareholder has specifically elected one of the methods supported
by DTCC. Otherwise, leave Blank.
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 33
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FIELD NAME
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Shares to Cover Short
Value is always ‘N’
Indicator
Firm Reject Reason
Use only if Record Content Indicator is 03 = Firm reject record. Otherwise, leave
Code
Blank.
In the Mutual Fund Context, Reject Reason Codes should be used as follows:
01 = Receiver cannot apply received cost basis record
Used when the underlying account position cannot be located or when related fields are
not correctly populated on the record received.
02 = CBRS quantity is greater than delivered quantity
Because it is not possible, in this instance, to know which portion of basis is relevant, it is
not possible to use any of it for tracking and calculation purposes.
NOTE 1: Some broker/dealer reporting brokers have indicated they may, from time to
time, send a greater CBRS quantity than that indicated on the corresponding
transaction. This is typically due to earned dividends received between
placement and settlement. Users will need to decide how they will handle these
situations (e.g. suspend activity for manual review and completion, reject
outright).
NOTE 2: If CBRS quantity is less than the delivered quantity, basis can be used. The
remainder of shares should be considered non-covered for calculation and
tracking purposes. As a reminder, it is the receiving firm’s responsibility to
request information from the delivering firm, if data is not received. Therefore,
the recommended practice is to send a cost basis request record (Record
Indicator 04 = Request) for any missing shares, prior to making non-covered.
03 = CUSIP does not belong to Issuer/Transfer Agent
Typically, this will not be encountered in the Mutual Fund space and was primarily
intended for other entities using CBRS. However, this can be used if the Fund recipient
cannot locate the CUSIP under their NSCC and/or CBRS participant number.
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 34
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
The following elaborates on the mutual fund usage and perspective on key fields comprising the CBRS Tax
Lot Records as of May 2011. Please note that record layouts are subject to change. Please visit
http://www.dtcc.com/products/documentation/cs/cbrs.php for most recent version of the layouts. In no
way should this information be viewed as standalone. Instead it is supplemental to DTCC’s CBRS User
Guide governing the overall usage of CBRS by the financial services industry.
CBRS Tax Lot Record – Elaboration on Select Fields for Mutual Funds 22
21F
FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
Record Content
Record Content Indicator defines the type of information represented by this Tax Lot
Indicator
Record.
Regarding 01 = Original Tax Lot Record.
This record is sent by the Delivering Firm, or the reporting broker that delivers shares as
a result of the transfer.
Regarding 02 = Corrected Tax Lot Record.
This record is sent by the Delivering Firm, or the reporting broker that delivers shares as
a result of the transfer.
When one tax lot is corrected, it is assumed the entire CBRS response requires
correction. For example:
Transfer 1,000.000 shares in three tax lots, as follows:
Tax Lot 1 = 500.000 shares
Tax Lot 2 = 250.000 shares
Tax Lot 3 = 250.000 shares
If details on Tax Lot 3 need to be corrected / resent, all three tax lot records should be
included. Tax Lots 1 and 2 should also be resent, to maintain the integrity of the
relationship between tax lots and transferred shares.
NOTE: At least one (1) corresponding tax lot record must be indicated as Corrected.
Regarding 03 = Firm Reject Record and 04 = Request Record.
These records are sent by the Receiving Firm, or the reporting broker that receives
shares as a result of the transfer.
Records are sent only when necessary and to maintain compliance with regulations.
22
Please refer to DTCC’s CBRS User Guide for more detail on Tax Lot Record, Required/Optional Field Designations and
Usage
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FIELD NAME
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Record Content
NOTE: The recommended practice is to not submit a Record Content Indicator 03 =
Indicator (cont.)
Firm Reject Record in response to a 04 = Request Record received, even if it
is not applicable to the receiving reporting broker.
Transaction Type
Transaction Type identifies the actual DTCC-based or manual transaction that created
the need to transfer cost basis through CBRS.
The only applicable Transaction Types for Mutual Funds are as follows:
46 = Fund to Firm Mutual Fund Transfer (ACATS PTF)
51 = Firm to Fund Mutual Fund Transfer (ACATS PTF)
56 = Networking Transaction
57 = Manual Mutual Fund Transfer
Transfer Control
The Transfer Control Number corresponds to the unique identifier assigned to the
Number
corresponding transaction, either through use of a DTCC product (e.g.: ACATS (ACATS
Fund/SERV) or Networking) or manually. The number is used by the recipient to link
CBRS information to its corresponding transaction.
If Transaction Type is 46 = Fund to Firm Mutual Fund Transfer or 51 = Firm to
Fund Mutual Fund Transfer; this field is the Fund/SERV Control Number – Position
45-59 (Variable) or Record 1, Position 41-55 (Fixed) on the Fund/SERV 018 record.
ACATS users can find this number in Position 153-163 (Variable) or Record 3, Position 818 (Fixed) of the ACATS Output Fund/SERV Statistics file (SIAC720 – variable; SIAC726
– fixed).
Firms using the Fund/SERV Control # from the ACATS-Fund/SERV Statistics File should
add the letters “CATS” to the front of it, in order to match the number that Funds should
provide in this field.
If transaction type is 56 = Networking Transaction, then the control number is the
Networking Control Number, found in Record 1, Position 14-24 of the Networking
Conversion/Acknowledgement B52/F53 record.
For all other transaction types, 57 = Manual Mutual Fund Transfer; this field is the
control number agreed upon by the contra-parties involved in the original securities
transaction. The Control Number is the same as what is provided on the Networking F55
Activity Record, Record 4, Position 23-37.
In all instances, data should be left-justified and blank-filled in this alpha-numeric field on
the CBRS file.
Alternate Control
The Alternate Control Number, when available, corresponds to an additional unique
Number
identifier assigned to a corresponding transaction, either through use of a DTCC product
or manually. This field comes into play when data is being passed between two different
DTCC products, such as ACATS and ACATS-Fund/SERV.
If Transaction Type 46 = Fund to Firm Mutual Fund Transfer and 51 = Firm to
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FIELD NAME
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Alternate Control
Fund Mutual Fund Transfer, the ACATS Control Number must be provided in this Field,
Number (cont.)
found in Position 683-702 (Variable) or Record 8, Position 28-47 (Fixed) of the
Fund/SERV 018 record. It is also found in Position 12-15 (Variable) or Record 1,
Position 8-21 (Fixed) of the ACATS Transfer Input record (Autoroute 36667 – variable;
32667 – fixed). If not provided, the record will reject.
Data should be left-justified and blank-filled in this alpha-numeric field on the CBRS file
Contra Firm Number
The Contra Firm Number corresponds to either the Firm Account Number, or, if not
NOTE: This section applies
available, the CBRS User Account Number associated with the entity receiving this
to Record Content
CBRS Tax Lot Record.
Indicator 01
This number should always be obtained through validation against the CBRS User Master
(Original) and Record
File, updated and distributed daily by DTCC.
Content Indicator
The Contra Firm Number is populated based on relationship to the CBRS record itself,
02 (Corrected)
and not the corresponding transaction record. Therefore, the entity receiving the CBRS
record is always considered the receiving firm.
The following fields can come into play in validating against the CBRS User Master File as
to what the Contra Firm Number on the CBRS record should be. In all instances, data
is passed with lead zeros and right-justified:
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
The firm is the recipient of this record.
If populated, Originating Receiver Firm Number – Position 745-748 (Variable) or Record
8, Position 90-93 (Fixed) on the Fund/SERV 018 record – it means an MF Agent is in
use. This can be used to assist with validation against the CBRS User Master File.
ELSE
Firm Number – Position 12-15 (Variable) or Record 1, Position 8-11 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Original Deliverer Number – Positions 49-52 (Variable) or Record 1, Position 45-48
(Fixed) on the ACATS record can be used to assist with validation against the CBRS User
Master File.
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
The fund is the recipient of this record.
Fund Number – Position 24-27 (Variable) or Record 1, Position 20-23 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Original Receiver Number – Position 41-44 (Variable) or Record 1, Position 37-40 (fixed)
on the ACATS record can be used to assist with validation against the CBRS User Master
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Contra Firm Number
File.
(cont.)
NOTE: This section applies
Transaction Type 56 = Networking Transaction
to Record Content
If B52 places Network Level 3 or Trust-Networked Level 0 account assets in a Network
Indicator 01 (Original)
Level 4 or non-networked account, the fund is the recipient of the CBRS record. If
and Record Content
provided, the Clearing/Settling Fund Number – Position 10-13 on the Networking
Indicator 02 (Corrected)
B52/F53 record can be used to assist with validation against the CBRS User Master File.
If B52 places Network Level 4 or non-networked account assets in a Network Level 3 or
Trust-Networked Level 0 account, the firm is the recipient of the CBRS record. The
Clearing/Settling Firm Number – Position 6-9 on the Networking B52/F53 record can be
used to assist with validation against the CBRS User Master File.
Transaction Type 57 = Manual Mutual Fund Transfer
If Network Level 3 or Trust-Networked Level 0 account assets are transferred into a
Network Level 4, or non-networked account, the fund is the recipient of the CBRS record.
If Network Level 4 or non-networked account assets are transferred into a Network Level
3 or Trust-Networked Level 0 account, the firm is the recipient of the CBRS record.
Information on the Manual Transfer instruction will need to be consulted against the
CBRS User Master File to identify the appropriate reference.
Contra Firm Number
The Contra Firm Number corresponds to either the Firm Account Number, or, if not
NOTE: This section applies
available, the CBRS User Account Number associated with the entity receiving this
to Record Content
CBRS Tax Lot Record.
Indicator 03 (Firm
This number should always be obtained through validation against the CBRS User Master
Reject) and Record
File, updated and distributed daily by DTCC.
Content Indicator
The Contra Firm Number is populated based on relationship to the CBRS record itself,
04 (Request)
and not the corresponding transaction record. Therefore, the entity receiving the CBRS
record is always considered the receiving firm.
The following fields can come into play in validating against the CBRS User Master File as
to what the Contra Firm Number on the CBRS record should be. In all instances, data
is passed with lead zeros and right-justified:
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
The fund is the recipient of this record.
Fund Number – Position 24-27 (Variable) or Record 1, Position 20-23 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
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Contra Firm Number
Original Receiver Number – Position 41-44 (Variable) or Record 1, Position 37-40 (fixed)
(cont.)
on the ACATS record can be used to assist with validation against the CBRS User Master
NOTE: This section applies
File.
to Record Content
Indicator 03 (Firm
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
Reject) and Record
The firm is the recipient of this record.
Content Indicator 04
(Request)
If populated, Originating Receiver Firm Number – Position 745-748 (Variable) or Record
8, Position 90-93 (Fixed) on the Fund/SERV 018 record – it means an MF Agent is in
use. This can be used to assist with validation against the CBRS User Master File.
ELSE
Firm Number – Position 12-15 (Variable) or Record 1, Position 8-11 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Original Deliverer Number – Positions 49-52 (Variable) or Record 1, Position 45-48
(Fixed) on the ACATS record can be used to assist with validation against the CBRS User
Master File.
Transaction Type 56 = Networking Transaction
If B52 places Network Level 3 or Trust-Networked Level 0 account assets in a Network
Level 4 or non-networked account, the firm is the recipient of the CBRS record. The
Clearing/Settling Firm Number – Position 6-9 on the Networking B52/F53 record can be
used to assist with validation against the CBRS User Master File.
If B52 places Network Level 4 or non-networked account assets in a Network Level 3 or
Trust-Networked Level 0 account, the fund is the recipient of the CBRS record. If
provided, the Clearing/Settling Fund Number – Position 10-13 on the Networking
B52/F53 record can be used to assist with validation against the CBRS User Master File.
Transaction Type 57 = Manual Mutual Fund Transfer
If Network Level 3 or Trust-Networked Level 0 account assets are transferred into a
Network Level 4, or non-networked account, the firm is the recipient of the CBRS record.
If Network Level 4 or non-networked account assets are transferred into a Network Level
3 or Trust-Networked Level 0 account, the fund is the recipient of the CBRS record.
Information on the Manual Transfer instruction will need to be consulted against the
CBRS User Master File to identify the appropriate reference.
Contra Firm Type
Receiving Firm Type clarifies the type of entity receiving the CBRS record. This is
important because the same participant number can be assigned by DTCC to different
firms across services of DTCC subsidiaries. This type corresponds to the type of number
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in the Contra Firm Number field and is obtained from the CBRS User Master File.
Values:
AGTNBR = Transfer Agent (not relevant to Mutual Funds)
CBRACT = CBRS-Only Use
DTCPRT = DTC Participant
NSCPRT = NSCC Participant
Submitting Firm Number
The Submitting Firm Number corresponds to the Firm Account Number, or, if not
NOTE: This section applies
available, the CBRS User Account Number associated with the entity submitting this
to Record Content
CBRS Tax Lot Record.
Indicator 01
This number should always be obtained through validation against the CBRS User Master
(Original) and Record
File, updated and distributed daily by DTCC.
Content Indicator
The Submitting Firm Number is populated based on relationship to the CBRS record
02 (Corrected)
itself, and not the corresponding transaction record. Therefore, the entity submitting the
CBRS record is the submitting firm.
The following fields can come into play in validating against the CBRS User Master File as
to what the Submitting Firm Number on the CBRS record should be. In all instances,
data is passed with lead zeros and right-justified:
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
The fund is the submitter of this record.
Fund Number – Position 24-27 (Variable) or Record 1, Position 20-23 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
The firm is the submitter of this record.
If populated, Originating Receiver Firm Number – Position 745-748 (Variable) or Record
8, Position 90-93 (Fixed) on the Fund/SERV 018 record – it means an MF Agent is in
use. This can be used to assist with validation against the CBRS User Master File.
ELSE
Firm Number – Position 12-15 (Variable) or Record 1, Position 8-11 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
Submitting Firm Number
Transaction Type 56 = Networking Transaction
(cont.)
If B52 places Network Level 3 or Trust-Networked Level 0 account assets in a Network
NOTE: This section applies
Level 4 or non-networked account, the firm is the submitter of the CBRS record. The
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to Record Content
Clearing/Settling Firm Number – Position 6-9 on the Networking B52/F53 record can be
Indicator 01 (Original)
used to assist with validation against the CBRS User Master File.
and Record Content
If B52 places Network Level 4 or non-networked account assets in a Network Level 3 or
Indicator 02 (Corrected)
Trust-Networked Level 0 account, the fund is the submitter of the CBRS record. If
provided, the Clearing/Settling Fund Number – Position 10-13 on the Networking
B52/F53 record can be used to assist with validation against the CBRS User Master File.
Transaction Type 57 = Manual Mutual Fund Transfer
If Network Level 3 or Trust-Networked Level 0 account asset is transferred into a
Network Level 4, or non-networked account, the firm is the submitter of the CBRS record.
If Network Level 4 or non-networked account asset is transferred into a Network Level 3
or Trust-Networked Level 0 account, the fund is the submitter of the CBRS record.
Information on the Manual Transfer instruction will need to be consulted against the
CBRS User Master File to identify the appropriate reference.
Submitting Firm Number
The Submitting Firm Number corresponds to the Firm Account Number, or, if not
NOTE: This section applies
available, the CBRS User Account Number associated with the entity submitting this
to Record Content
CBRS Tax Lot Record.
Indicator 03 (Firm
This number should always be obtained through validation against the CBRS User Master
Reject) and Record
File, updated and distributed daily by DTCC.
Content Indicator
The Submitting Firm Number is populated based on relationship to the CBRS record
04 (Request)
itself, and not the corresponding transaction record. Therefore, the entity submitting the
CBRS record is the submitting firm.
The following fields can come into play in validating against the CBRS User Master File as
to what the Submitting Firm Number on the CBRS record should be. In all instances,
data is passed with lead zeros and right-justified:
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
The firm is the submitter of this record.
If populated, Originating Receiver Firm Number – Position 745-748 (Variable) or Record
8, Position 90-93 (Fixed) on the Fund/SERV 018 record – means an MF Agent is in use.
This can be used to assist with validation against the CBRS User Master File.
ELSE
Firm Number – Position 12-15 (Variable) or Record 1, Position 8-11 (Fixed) on the
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Master File.
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Submitting Firm Number
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
(cont.)
The fund is the submitter of this record.
NOTE: This section applies
Fund Number – Position 24-27 (Variable) or Record 1, Position 20-23 (Fixed) on the
to Record Content
Fund/SERV 018 record can be used to assist with validation against the CBRS User
Indicator 03 (Firm
Master File.
Reject) and Record
Content Indicator 04
(Request)
Transaction Type 56 = Networking Transaction
If B52 places Network Level 3 or Trust-Networked Level 0 account assets in a Network
Level 4 or non-networked account, the fund is the submitter of the CBRS record. If
provided, the Clearing/Settling Fund Number – Position 10-13 on the Networking
B52/F53 record can be used to assist with validation against the CBRS User Master File.
If B52 places Network Level 4 or non-networked account assets in a Network Level 3 or
Trust-Networked Level 0 account, the firm is the submitter of the CBRS record. The
Clearing/Settling Firm Number – Position 6-9 on the Networking B52/F53 record can be
used to assist with validation against the CBRS User Master File.
Transaction Type 57 = Manual Mutual Fund Transfer
If Network Level 3 or Trust-Networked Level 0 account asset is transferred into a
Network Level 4, or non-networked account, the fund is the submitter of the CBRS
record.
If Network Level 4 or non-networked account asset is transferred into a Network Level 3
or Trust-Networked Level 0 account, the firm is the submitter of the CBRS record.
Information on the Manual Transfer instruction will need to be consulted against the
CBRS User Master File to identify the appropriate reference.
Submitting Firm Type
Submitting Firm Type clarifies the type of entity sending the CBRS record. This is
important because the same participant number can be assigned by DTCC to multiple
firms across the DTCC products utilizing CBRS. This type corresponds to the type of
number in the Submitting Firm Number field.
Values:
AGTNBR = Transfer Agent (not relevant to Mutual Funds)
CBRACT = CBRS User
DTCPRT = DTC Participant
NSCPRT = NSCC Participant
Receiver Customer
The Receiver Customer Account Number identifies the customer’s account to which
Account Number
the CBRS data will be applied. This account number may differ from the BIN (Broker
Identification Number) and may represent an underlying sub-account available to the
firm in question.
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Receiver Customer
Identification Number) and may represent an underlying sub-account available to the
Account Number (cont.)
firm in question.
The Receiver Customer Account Number is ALWAYS populated based on relationship
to the corresponding transaction record; it ALWAYS references the account that should
receive the cost basis information and is not impacted by the value of the Record
Content Indicator.
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
If populated, Originating Receiver Customer Account Number at Firm – Position 547-566
(Variable) or Record 6, Position 78-97 (Fixed) on the Fund/SERV 018 record – means an
MF Agent is in use, and this field should be used.
ELSE
Customer Account Number at Firm – Position 572-591 (Variable) or Record 7, Position
10-29 (Fixed) of the Fund/SERV 018 record.
Original Receiver Customer Account Number – Position 53-72 (Variable) or Record 1,
Position 49-68 (Fixed) of the ACATS record.
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
Customer Account Number at Fund – Position 140-159 (Variable) or Record 2, Position
43-62 (Fixed) of the Fund/SERV 018 record.
OR
Original Receiver Customer Account Number – Position 53-72 (Variable) or Record 1,
Position 49-68 (Fixed) of the ACATS Transfer record.
Transaction Type 56 = Networking Transaction
If B52 places Network Level 3 or Trust-Networked Level 0 account assets in a Network 4
or non-networked account, use the Credit Account Number – Record 1, Position 57-76 of
the Networking B52/F53 record, which should reference the Fund’s Account Number.
If B52 places Network Level 4 or non-networked account assets in a Network Level 3, or
Trust-Networked Level 0 account, first use the Credit Sub-Account Number – Record 4,
Position 46-65 of the Networking B52/F53 record. If the Credit Sub-Account Number is
blank, use the Credit Account Number – Record 1, Position 57-76 of the Networking
B52/F53 record, which should reference the Firm’s Account Number.
Transaction Type 57 = Manual Mutual Fund Transfer
If Network Level 3 or Trust-Networked Level 0 account assets are transferred into
Network Level 4, or non-networked account, this field should carry either the Underlying
Customer Account Number or the Fund’s Account Number.
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Receiver Customer
If Network Level 4 or non-networked account assets are transferred into a Network Level
Account Number (cont.)
3, or Trust-Networked Level 0 account, this field should carry either the Underlying
Customer Account Number or the Firm’s Account Number.
Deliverer Customer
The Deliverer Customer Account Number identifies the customer’s account from
Account Number
which the CBRS data will be sent. This account number may differ from the BIN (Broker
Identification Number) and may represent an underlying sub-account available to the
firm in question.
The Deliverer Customer Account Number is ALWAYS populated based on relationship
to the corresponding transaction record; it ALWAYS references the account from which
cost basis information is sent and is not impacted by the value of the Record Content
Indicator.
Transaction Type 46 = Fund to Firm Mutual Fund Transfer
Customer Account Number at Fund – Position 596-615 (Variable) or Record 7, Position
54-73 (Fixed) of the Fund/SERV 018 record.
OR
Original Deliverer Customer Account Number – Position 173-192 (Variable) or Record 3,
Position 38-57 (Fixed) of the ACATS Transfer record.
Transaction Type 51 = Firm to Fund Mutual Fund Transfer
If populated, Original Deliverer Customer Account Number – Position 177-196 (Variable)
or Record 2, Position 80-99 (Fixed) of the Fund/SERV 018.
ELSE
Customer Account Number at Firm – Position 572-591 (Variable) or Record 7, Position
10-29 (Fixed) of the Fund/SERV 018 record.
Original Deliverer Customer Account Number – Position 173-192 (Variable) or Record 3,
Position 38-57 (Fixed) of the ACATS Transfer record.
Transaction Type 56 = Networking Transaction
If B52 places Network Level 3 and Trust-Networked Level 0 account assets in a Network
4 or non-networked account, first use the Debit Sub-Account Number – Record 4,
Position 66-85 of the Networking B52/F53 record. If the Debit Sub-Account Number is
blank, use the Account Number – Record 1, Position 36-55 of the Networking B52/F53
record, which should reference the Firm’s Account Number.
If B52 places Network Level 4, or non-networked account assets in a Network Level 3, or
Trust-Networked Level 0 account, use the Account Number – Record 1, Position 36-55 of
the Networking B52/F53 record, which should reference the Fund’s Account Number for
the transaction.
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Deliverer Customer
Transaction Type 57 = Manual Mutual Fund Transfer
Account Number (cont.)
If Network Level 3 or Trust-Networked Level 0 account assets are transferred into a
Network Level 4, or non-networked account, this field should carry either the Underlying
Customer Account Number or the Firm’s Account Number.
If Network Level 4 or non-networked account assets are transferred into a Network Level
3, or Trust-Networked Level 0 account, this field should carry either the Underlying
Customer Account Number or the Fund’s Account Number.
ISIN Country Code
Value is US
ISIN Security Issue ID
Security Issue ID (CUSIP) of the Security in question
(CUSIP)
ISIN Security Check
If the ISIN Country Code passed is ‘US’, this field can be left blank.
Digit
Asset Description
This field should be populated with the same Security Issue ID (CUSIP) Fund Name found
on Mutual Fund Profile, if a participant. Otherwise, field should be populated in a way to
clearly identify the Security Issue ID.
Certificate Number
Leave Blank
Prefix
Certificate Number
Leave Blank
Non-covered / Pending
Field notes if the tax lot information is not covered by the IRS requirement to report cost
Indicator
basis. If the lot information is exempt from IRS reporting, indicates the reason the lot is
exempt.
Blank = If basis on this tax lot is covered
01 = Non-covered Lot. This indicates the lot is not covered by the Cost Basis reporting
requirement to the IRS. Non-covered lots can still carry valid cost basis information.
02 = Non-covered Account. This indicates the account itself is not covered by the Cost
Basis reporting requirement to the IRS. Lots in non-covered accounts can still carry valid
cost basis information. An example would be a type of account (retirement) or recipient
(C-Corporation).
03 = Pending. If basis on this tax lot is pending receipt by the delivering firm, which is
sometimes the case in account consolidation / pass-through arrangements, this value
should be used.
04 = Certificate in Customer Name. This status is not applicable to Mutual Funds.
Because the Fund’s Transfer Agent is the sole issuer of certificated shares, shares
transferred must either have the certificate deposited or a surety bond issued to replace
the shares. In other words, these shares should always be available for cost basis
Non-covered / Pending
calculation within the mutual fund account.
Indicator (cont.)
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Taxes Reported by
Leave Blank
Issuer / Transfer Agent
Gifted or Inherited
Tax lots related to gift and/or inheritance transactions often receive special treatment for
Indicator
calculating, tracking, and reporting cost basis. Refer to the CBRS User Guide for all valid
values.
If the tax lot pertains to a transaction that is neither a gift nor inheritance, leave Blank.
If the tax lot pertains to a gift transaction, either 01 = Gifted or 03 = Inherited then
Gifted must be populated. Additionally, CBRS will expect Date of Gift and Fair Market
Value as of Date of Gift to also be populated.
Date of Gift
If Gifted or Inherited Indicator is 01 = Gifted or 03 = Inherited then Gifted, field
indicates date of gift.
If not a Gift transaction, leave Blank
If a Gift transaction, must be a valid date. Format CCYYMMDD
Fair Market Value as of
If Gifted or Inherited Indicator is 01 = Gifted or 03 = Inherited then Gifted, field
Date of Gift
indicates the Fair Market Value on the date of gift.
If not a Gift transaction, leave Blank
If a Gift transaction, a value is required. NOTE: Zeros are considered a valid value.
Tax Lot Quantity
The quantity of the tax lot being transferred.
NOTE: The sum of the Tax Lot Quantity fields of the Tax Lot records must equal the
Total Position Quantity reported on the corresponding Asset Record.
Position Code
Value is always ‘L’
Acquisition Date of Tax
Value reflects the original acquisition date of the shares by the shareholder, adjusted for
Lot
any wash sales. This may or may not reflect the trade / transaction date held on the
shareholder recordkeeping system.
Format: CCYYMMDD
Additional considerations:

If the Tax Lot Current Cost is zero because it is an unknown value (Zero
Basis Indicator is 02 = Unknown), the Tax Lot Current Cost field should
be passed as Blank. DTCC will blank out the field if it is populated.

If the tax lot reflects an aggregation of multiple tax lots, a value of 19010101 is
used to designate the IRS-permitted designation of VARIOUS on Cost Basis
reporting to the shareholder and IRS.
Original Acquisition
Since the Acquisition Date of Tax Lot is adjusted for the impact of wash sales, it is
Date for Wash Sale
suggested the original acquisition date for any tax lots that have been adjusted by a
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 46
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
CBRS Tax Lot Record – Elaboration on Select Fields for Mutual Funds 22
21F
FIELD NAME
COMMENTS AND GUIDANCE FOR FIELD USAGE
Adjustment
wash sale is provided in this field.
ISO Currency Code
Value is always ‘USD’
Exchange Rate
Leave Blank
Tax Lot Original Cost
Leave Blank
Tax Lot Current Cost
Provide the current cost associated with the tax lot in question. The ICI BDAC CBR Task
Force has selected this field as the required field to provide tax lot cost information, to
provide standardization across the Industry in adopting CBRS.
NOTE:
All tax lots that have been valued at the account’s Average Cost should report
that value in this field.
A zero and/or blank value is accepted in this field, but it must be clarified by the Zero
Basis Indicator field.
Zero Basis Indicator
Clarifies the intent of a zero or blank value in the Tax Lot Current Cost field.
If Tax Lot Current Cost is greater than zero, then leave Blank
If Tax Lot Current Cost is equal to zero, then clarification must be provided in this field
if that is 01 = True Zero or 02 = Unknown basis information.
If Tax Lot Current Cost is equal to ‘blank’, then this field must be 02 = Unknown.
Tax Lot Original Unit
Leave Blank
Price
Employee Plan Shares
Leave Blank
Indicator
Purchase / Dividend
Leave Blank, which will default to P = Purchase
Reinvestment Indicator
This field is no longer needed. It was originally to be used for Corporate Action
adjustments to tax lots, but since the broker holding the tax lot on the effective date of
the Corporate action must adjust the cost basis for the Corporate Action, the field no
longer is necessary.
ANNOTATED CBRS RECORD LAYOUTS AND RECOMMENDED PRACTICES FOR MUTUAL FUNDS > 47
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5
Transfers of Mutual Fund Securities
CBRS provides operating efficiencies to mutual fund transfer agents, broker-dealers and other
intermediaries by permitting the timely movement of cost basis information for mutual fund
securities from one financial firm to another in a standardized, automated, and secure
environment. Users should be aware that CBRS neither informs users which transactions trigger
the need to send or receive cost basis information; nor does it calculate basis or provide any
reconciliation capabilities for cost basis records that are expected and then received. Therefore,
the transfer scenarios and other information provided in this section should be considered by
funds, intermediaries and service providers when programming for the movement of cost basis
information using CBRS.
5.1.1 Transfer Methods and Tax Reporting
Mutual fund transfer processing is not standardized among broker/dealers, banks, and mutual
fund companies. The current state of the fund transfer processing remains fragmented with
segments that are fully automated and other areas that are completely manual. Roughly 90% of
transfer activity is initiated by firms. The following categories represent the customary methods
used to execute fund transfers. If one of the automated solutions fails or is not supported by a
fund or intermediary, it is common for such transfer requests to be processed manually.

ACATS - Customer account transfers between broker/dealers (firms) are highly
automated through NSCC’s Automated Customer Account Transfer System (“ACATS”).
ACATS may also be used to a limited extent for mutual fund transfers between banks
and broker/dealers. This guide does not address ACATS transfers between
broker/dealers, or banks and broker/dealer firms for assets other than mutual funds.

ACATS- Fund/SERV – This link between two NSCC systems automates the reregistration of mutual fund positions. Participation in ACATS and ACATS-Fund/SERV is
required for brokers and voluntary for banks. Fund participation in ACATS-Fund/SERV is
authorized on a fund-by-fund basis.

NSCC’s Fund/Firm Transfer Capabilities 23 (ACATS PTF) - A transfer type which
2F
leverages ACATS and ACATS-Fund/SERV, broker-initiated in-kind transfers may be
23
This functionality addresses firm-initiated retirement and non-retirement account re-registrations that
move shares from firm (i.e., Networking Level 3 or omnibus accounts) to existing fund direct accounts, as
well as from fund direct accounts to firms. These types of re-registrations are referred to as “in-kind
transfers” although, in fact, no asset actually transfers between the fund and intermediary, and the shares
are simply re-registered on the books of the fund. This functionality went live with DTCC on January 23,
2009. See “Best Practices Fund/Firm Capability Users Guide” on the DTCC website at:
http://www.dtcc.com/products/wealthmgmt/members/fundserv_manuals.php.
TRANSFERS OF MUTUAL FUND SECURITIES > 48
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
submitted using this automation. Broker-initiated in-kind transfers are submitted
through ACATS. In turn, the NSCC processes the request and forwards it to the fund
through ACATS-Fund/SERV. Fields are incorporated into ACATS-Fund/SERV to provide
funds with sufficient transparency to systematically verify that only like account types
(e.g., IRA to IRA for retirement scenarios) are being transferred, and to assist funds in
validating customer information. Upon verification of the ACATS-Fund/SERV record, the
fund can elect to systematically re-register the shares without the need of manual
intervention.

Networking – While not originally designed to automate the transfer process, many
brokerage firms, working directly with funds, have adapted the Networking functionality
along with Change of Dealer enhancements to facilitate transfer processing. This
method, however, does not generally cover all types of transfers or all types of accounts
and cannot be used to move shares to be held directly by funds.

Manual (aka non-ACAT) – This costly, labor intensive, paper-based process relies on
physical delivery of paperwork and manual processing without any automated tracking.
Fund companies and broker dealers receive large numbers of manual transfer requests
that are processed outside of the automated services mentioned above. This lack of
automation is a source of a disproportionate number of client complaints due to the time
required to complete the transactions and has historically been a focus of regulators.
A cost basis transfer reporting statement is required to be sent on 1099-B taxable accounts,
when transfers occur between reporting brokers, including mutual fund transfer agents and
financial intermediaries. The entities responsible for tax reporting on the account types listed
below are as follows 24:
23F
Matrix Level/Account Type
Tax Reporting Responsibility
Level 0
Fund
Level 3
Firm
Level 4
Fund
Omnibus or House Account (by social/any matrix level)
Firm
Trust Networked Accounts (Levels 0 or 4)
24
Bank/Trust
The list reflects tax reporting responsibilities by Matrix Level/Account Type as defined in the NSCC
Networking Technical Guide. As noted in Appendix B, firms and funds must evaluate their business
arrangements and legal agreements and implement changes, where tax reporting responsibilities are split
between entities, to ensure that all shareholders receive accurate, timely and complete tax reporting.
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Reporting brokers use a number of identifiers to track when a transfer between reporting
brokers occurs, the most common of which is the NSCC Network Control Indicator (commonly
referred to as the Matrix Level). These transfers are triggering events that require the
subsequent movement of cost basis reporting records (through CBRS). The table below
illustrates the various account transfer methods that are utilized for transfers between funds and
financial intermediaries by account types when the 1099-B tax reporting responsibility changes.
Tax Reporting Responsibilities for Transfers between Account Types:
To Account Type:
Matrix 0,4
Matrix 3
Omnibus /
House Acct
Trust
Networked
CB moves
within Fund
internally
Fund Delivers
CB to Firm
Fund Delivers
CB to Firm
Fund Delivers
CB to Firm
ACATS FS
-
Alternate
Alternate
Alternate
ACATS PTF
-
Preferred
Preferred
Alternate
B52
-
-
-
Preferred
Alternate
Alternate
Alternate
Alternate
Fund Receives
CB from Firm
CB moves
between firms
CB moves
between firms
CB moves
between firms
ACATS FS
Alternate
Preferred
Preferred
Alternate
ACATS PTF
Preferred
Alternate
Alternate
Alternate
-
Preferred
Preferred
Preferred
Manual
Alternate
Alternate
Alternate
Alternate
ACATS FS
Alternate
Preferred
Alternate
Alternate
ACATS PTF
Preferred
Alternate
Alternate
Alternate
B52
Alternate
Preferred
Preferred
Preferred
Manual
Alternate
Alternate
Alternate
Alternate
ACATS FS
Alternate
Alternate
Alternate
Alternate
ACATS PTF
Alternate
Alternate
Alternate
Alternate
Preferred
Preferred
Preferred
Preferred
Alternate
Alternate
Alternate
Alternate
Transfer
Type
Matrix 0,4
From Account Type:
Manual
Matrix 3
B52
Omnibus/
House
Trust
Networked
B52
Manual
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Key Terms:

ACATS FS: ACATS-Fund/SERV Transfer (via 018 record)

ACATS PTF: ACATS-PTF/ACATS-Fund/SERV Transfer-in-kind or Fund to Firm’ (Pull
initiated by Firm) or ‘Firm to Fund’ (Push initiated by Firm)

B52: Networking Transfer (via B52 record)

Manual: Manual Transfer

CB: Cost Basis Information
 Note: The preferred or recommended transfer method(s) used are highlighted above and
alternate transfer methods utilized are also identified.
Other maintenance transactions not captured above also can change existing tax reporting
responsibilities. The following industry recommended practice was developed to prevent certain
maintenance record requests from occurring that would change existing tax reporting
responsibilities and trigger cost basis transfer reporting.
 Industry Recommended Practice: NSCC’s Networking service provides functionality that
enables a Networking Maintenance B51 record to process a matrix level change on an
account held at the fund. In some cases the B51 Maintenance requested changes the control
of the account and the tax reporting responsibility. Therefore, any networking maintenance
change on an account that would change the existing tax reporting responsibility on mutual
fund shares should be processed through a transfer transaction and not by utilizing the
Networking Maintenance B51 record.
5.1.2 DTCC Enhancements for Cost Basis Reporting
The records used to facilitate transfer activities are different than records passed through the
DTCC’s Cost Basis Reporting Service. Funds and firms identified the need to link the movement
of shares (transfer activity) to the CBRS records that would follow in order to correctly apply
cost basis information received to the correct customer account in an automated and
standardized fashion. In order to aide in that reconciliation, NSCC implemented the following
enhancements to various transfer related records:

Underlying Customer Account Numbers in an Omnibus environment (Activity Record
F55)
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The “Underlying Customer Account Number” and “Opposing Underlying Customer
Account Number” fields are found on the Activity Record F55 (Important Notices A7175
and A7241r)
These fields facilitate greater transparency when transferring shares in an Omnibus
environment, allowing funds to pass the sub-account number (if received on instructions
for manual transfers to an omnibus account) which is communicated to the firms for
direct transfers via the F55 Record.
These fields should be populated from the perspective of the recipient of the
F55. Therefore the “Underlying Customer Account Number” on the F55
generated for one side of the transfer becomes the “Opposing Underlying
Customer Account Number” on the F55 generated for the other side of the
transfer.
Field Name
Underlying Customer
Account Number
Field Name
Opposing Underlying
Customer Account
Number

Start
End
Len
76
95
20
Start
End
Len
28
47
20
Type
A/N
Type
A/N
Description
Opt/Req
Underlying Customer Account
Number at the Firm receiving
the F55 record
Description
O
Opt/Req
Underlying Customer Account
Number at the Firm delivering
the F55 record
“Opposing Originating /Underlying Firm Number” and “Originating /Underlying Firm
Number “ fields added to the Activity Reporting Record F55 (Important Notice A7665)
These new fields will assist in reporting the Underlying Firm information on F55 records when an
Introducing Firm (MF Agent) is involved. The data will be used to communicate appropriate
details on manual transfers and transfer cancellations.
It is recommended that funds populate these new fields with the NSCC ID number when MF
Agent information is known for the above transactions types. NSCC will create these new fields
as Optional fields, as MF Agent is not always involved or known.
It is recommended that on a manual transfer request, the Requesting Firm would provide the
related Underlying Account details. The Fund would then be expected to pass this additional
information on the F55 record as follows:

Firm Debit Original Transfers (to a Fund or another Firm account held at the Fund) would
pass the information as “Originating / Underlying Firm Number” on the Debit F55 and in
the “Opposing Originating / Underlying Firm Number” on the Credit F55 sent through
Direct Account Networking (if produced).
TRANSFERS OF MUTUAL FUND SECURITIES > 52
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Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds

Firm Credit Original Transfers (from a Fund or another Firm account held at the Fund)
would pass the information as “Opposing Originating / Underlying Firm Number” on the
Debit F55 sent through Direct Account Networking (if produced) and in the “Originating /
Underlying Firm Number” on the Credit F55.

Firm to Firm Original Transfers could possibly have two sets of Underlying Account
information. If only one side has Underlying Account information, it would be passed as
indicated above. If BOTH Firms had Underlying Account information, a combination of
both approaches would be pursued:
 DEBIT F55: Debit Firm = Originating / Underlying Firm Number; Credit Firm =
Opposing Originating / Underlying Firm Number
 CREDIT F55: Debit Firm = Opposing Originating / Underlying Firm Number; Credit
Firm = Originating / Underlying Firm Number
 On a Reversal/Cancel/Void of an ACATS PTF, the transaction is processed manually either from
instructions or from data available on the 018/019 Fund/SERV record. Processing is similar to the
Original Manual Transfers, as follows:
 Reversal of Firm Debit PTF Transfers (to a Fund account) – also known as a PTF
PUSH, would pass the information as “Originating / Underlying Firm Number” on the F55
Transaction Type 33 and in the “Opposing Originating / Underlying Firm Number” on the
F55 Transaction Type 34 sent through Direct Account Networking (if produced).
 Reversal of Firm Credit PTF Transfers (from a Fund account) – also known as a PTF PULL,
would pass the information as “Opposing Originating / Underlying Firm Number” on the
F55 Transaction Type 33 sent through Direct Account Networking (if produced) and in the
“Originating / Underlying Firm Number” on the F55 Transaction Type 34.

A Firm to Firm ACATS PTF is not a valid scenario.
Field Name
Opposing Originating /
Underlying Firm Number
Start
End
Len
82
85
4
Type
A/N
Description
Opposing Originating Broker
Opt/Req
O
Firm number
(The underlying firm’s NSCC
ID number, for firms
transacting through an MF
Agent)
Originating / Underlying
Firm Number
86
89
4
A/N
Originating Broker Firm number
(The underlying firm’s NSCC
ID number, for firms
transacting through an MF
Agent)
TRANSFERS OF MUTUAL FUND SECURITIES > 53
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Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds

“Opposing Membership Identifier” field added to the Activity Reporting Record F55
(Important Notice A7665)

This new field will assist firms in building their Cost Basis expectancy files to
correctly route tax lots to the Opposing Party on manual transfers and transfer
cancellations.
Field Name
Opposing Membership
Identifier
Start
End
Len
94
95
2
Type
A/N
Description
Required for Transaction Types:
13 (Direct Transfer)
33 (Transfer from –
Cancellation)
34 (Transfer to – Cancellation)
Opt/Req
OC
Opposing Membership
Identifiers:
00 = N/A
01 = Trust

Original Control Number – This field is required on the Activity Reporting Record F55 if
the transaction type is a “direct” (manual) transfer (Transaction Type 13) (Important
Notice A7175).
This requirement allows funds to generate a transfer control number for direct (manual)
transactions to populate in the F55 “Original Control Number” field. The same control
number is also provided on the CBRS files, allowing firms to link the CBRS data to the
direct (manual) transaction.
Field Name
Original Control Number
Start
End
Len
23
37
15
Type
A/N
Description
Required if Transaction Type 13
(“Direct Transfer”) in record
F55 sequence #1.
The best practice recommendation for generating an “Original Control Number” for
manual transfer transactions is as follows:
TRANSFERS OF MUTUAL FUND SECURITIES > 54
Opt/Req
OC
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
 Industry Recommended Practice: When a control number does not exist or is not
provided a Manual Transfer Control Number should be generated. The algorithm for creating
a Manual Transfer Control Number, which should be referenced in the Original Control
Number field, is as follows:
Position
Length
Field Description
Value
1
1
Direct transfer indicator
D
2
4
NSCC member number for
9999
the fund
6
1
Last digit of current posting
9
year for the transfer
transaction
7
3
Posting date of the transfer
999
transaction in Julian date
format
10
6
Unique number (random-
999999
generated, sequential)
This number should be provided as the Original Control Number on Record 4, Position 23-37
of the Networking F55 record, plus as the Transfer Control Number for all related CBRS
records.
An F55 is used to report manual transactions processed at the fund against a networked
account. The activity file contains unique codes to identify the type of transaction. In
this case the fund would deliver a transaction type “13” indicating a direct transfer.

“Networking Control Number” – changed syntax
Effective with Important Notice A7665 (November, 2013), NSCC updated the syntax of
the Networking Transfer Control Number to provide greater uniqueness; specifically
addressing the need to identity the year a transaction takes place for the purposes of
Cost Basis reporting.
Networking Transfer Control Numbers are a key data match point between transactions
and CBRS records; but they had the potential to repeat annually. This possible
duplication could become significant when managing CBRS records, especially when
corrected tax lots are delivered to replace existing lots on a system. The change in the
TRANSFERS OF MUTUAL FUND SECURITIES > 55
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
syntax will accommodate unique Control Numbers for a 10 year period, which is
consistent with Fund/SERV. The new Control Number format is as follows:
Positions:
1 – 3 – Julian Date
4 – Year
5 – 11 – Alpha/Numeric

“Credit Sub-Account Number” and “Debit Sub-Account Number” fields added to the
Transfer Detail/Fund Acknowledgement Record A/B/T52, F53 (Important Notice A7175)
These fields allow participants to communicate the underlying sub-account number for
Networking transfers into or out of an omnibus account.
Field Name
Start
End
Len
Credit Sub-Account
Number
46
65
20
A/N
Underlying Credit Customer
Account Number
O/O
Debit Sub-Account
Number
66
85
20
A/N
Underlying Debit Customer
Account Number
O/O

Type
Description
Opt/Req
52/53
“Originating Receiver Firm Number” and “Originating Delivering Firm Number” fields
added to the ACATS–Fund/SERV Transfer Record 018 (Important Notice A7175)
The aforementioned fields assist the fund in an ACATS-PTF scenario where the firm uses
a Mutual Fund Agent for processing ACATS transfers. This information will specify the
originating parties and allow the fund further transparency with regard to the originating
parties of the transfer transaction for cost basis reporting.
Variable Format:
Field Name
Start
End
Len
Type
Description
Originating Receiver Firm
Number
745
748
4
A/N
Originating receiving broker firm number
Originating Delivering
Firm Number
749
752
4
A/N
Originating delivering broker firm number
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Fixed Format – sequence 8
Field Name
Start
End
Len
Type
Description
Originating Receiver Firm
Number
90
93
4
A/N
Originating receiving broker firm number
Originating Delivering
Firm Number
94
97
4
A/N
Originating delivering broker firm number

“Originating Receiver Customer Account Number at Firm” field to the ACATS–
Fund/SERV Transfer Record 018 (Important Notice A7175)
The addition of this field allows funds, in the case of an ACATS-PTF scenario, to identify
the customer account number that is being transferred via the ACATS. The field permits
further transparency of the underlying account information within an omnibus account.
TRANSFERS OF MUTUAL FUND SECURITIES > 57
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Variable Format:
Field Name
Start
End
Len
Type
Description
Originating Receiver
Customer Account
Number at Firm
547
566
20
A/N
Underlying Customer Account Number at the
Originating Firm
Fixed Format – sequence 6
Field Name
Start
End
Len
Type
Description
Originating Receiver
Customer Account
Number at Firm
78
97
20
A/N
Underlying Customer Account Number at the
Originating Firm

“Original Deliverer Customer Account Number” field to the ACATS–Fund/SERV Transfer
Record 018 (Important Notice A7256)
This field will allow funds, in the case of an ACATS-PTF scenario, to identify the customer
account number at the delivering firm. This field will be beneficial in the Cost Basis
transfer scenario if the deliverer fails to deliver cost basis to the receiving party and the
receiver needs to send a request to the deliverer.
Variable Format:
Field Name
Start
End
Len
Type
Description
Original Deliverer
Customer Account
Number
177
196
20
A/N
Underlying Customer Account Number at the
Delivering Firm
Fixed Format – sequence 2
Field Name
Start
End
Len
Type
Description
Originating Deliverer
Customer Account
Number
80
99
20
A/N
Underlying Customer Account Number at the
Delivering Firm

Guidelines for required use of “Transaction Type” 13, 33, 34 on Networking
Activity Reporting Record F55 (Important Notice A7472)
When confirming transfer activity through Networking F55 records, brokers need to know the
opposing account information when building their cost basis expectancy files.
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The following changes expand the use of the referenced fields from what was originally
designated within the context of omnibus/share aging reconciliation. The data will be used to
communicate appropriate details on manual transfers and transfer cancellation (Manual, ACATS
PTF, and Networking) to identify appropriate treatment of cost basis on corresponding accounts.
Field Name
Seq #
Start
End
Opt/Req
Optional/Conditional
1
Opposing
Clearing/Settling
Firm Number
2
Opposing
Network Control
Indicator
5
Opposing Fund
Account Number
4
3
5
23
26
Required for Transaction Type =13 (Direct Transfer),
33 (Transfer From – Cancellation), 34 (Transfer To –
Cancellation)
Optional/Conditional
27
27
Required for Transaction Type =13, 33, 34
Optional/Conditional
39
58
Required for Transaction Type = 13, 33, 34
In the unlikely event that the Opposing Clearing/Settling Firm actually holding cost basis
information is not an NSCC member, the industry recommended practice is to populate this field
with the fund’s NSCC member number. The fund will then have an additional responsibility to
deliver the cost basis information to the non-participating opposing firm. Firms who wish to
explore a cost basis-only membership with DTCC should contact Membership at (212)8558877.

Guidelines for use of “Initiating Firm” Field to the Account Conversion
Transfer Detail/Fund found on Acknowledgement Record A/B/T52, F53
(Important Notice A7472)
The BDAC CBR Task Force recommends leveraging Networking B52 Mass Broker to Broker
(Transaction type 4 = Mass Broker to Broker) for ad-hoc Broker-to-Broker transfers through
Networking. Some funds restrict use of Mass Broker to Broker transfers by creating permissions
which must be configured per-event (“open a window”). The Task Force agreed that, if the
initiating firm was known and was ALSO the delivering firm, funds which restrict use of
Transaction Type 4 should allow these “push” transfers (pushed from deliverer to receiver) to
automatically process, thereby eliminating the manual per-event notification and configuration
activities.
This capability to automatically allow “push” transfers through networking will significantly
reduce manual transfers, while providing the dual F53 notifications needed by brokers to build
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Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
accurate cost basis expectancy files. The firm initiating the B52 will be required to provide their
NSCC Participant Number in the Initiating Firm field when completing a transfer with a
Transaction Type of 4. It will be optionally included by funds on their F53 response.
Field Name
Length
Initiating Firm
4
Opt/Req
Type
Description
A/N
NSCC Participant
Number of the Firm
submitting the transfer
Optional/Conditional
Required on B52 for Transaction Type = 4
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Gifting Shares
When transferring shares manually, through Networking B52 Transfer record, or an ACATS PTF
“push”/ACATS 018 record, it is necessary to indicate whether the transfer is a gift. A gifting
designation is required in order for special gifting rules to be triggered when applicable. The
Networking B52 Transfer and ACATS 018 records both contain a field to denote a transfer is
related to a gift.
Transfer Detail/Fund Acknowledgment (A/B/T52, F53) #1 (Important Notice A7256)
Field Name
Start
End
Len
Type
Description
Opt/Req
52/53
Gift Indicator
94
94
1
A/N
Space = No
O/O
1 = Yes
ACATS Transfer (018) Variable Format:
Field Name
Start
End
Len
Type
Description
Gift/Donation Indicator
744
744
1
A/N
0 or Space = No, not a gift or donation
1 = Yes, it is a gift or donation
ACATS Transfer (018) Fixed Format – sequence 8
Field Name
Start
End
Len
Type
Description
Gift/Donation Indicator
89
89
1
A/N
0 or Space = No, not a gift or donation
1 = Yes, it is a gift or donation
If the shares transferred have been gifted, the deliverer of the cost basis information would send
the applicable asset and tax lot(s) records indicating the donor’s original acquisition date,
donor’s adjusted basis amount, date of gift and the Fair Market Value (FMV) basis on the date of
gift.
 Note: ACATS PTF ‘Pull’ requests do not support a transfer of shares due to gift (Important Notice
A7256). Instead, the shareholder must contact the fund directly to execute the transfer.
 Industry Recommended Practice: Networking transfers should not be used to ‘pull’ shares for a
transfer due to gift. Instead, the shareholder must contact the fund directly to execute the
transfer.
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Exception/Correction Processing
Following a full or partial transfer, a fund or firm may need to cancel/correct the actual transfer
transaction (e.g. to correct the number of shares). Cancelation or correction of a previously
posted transfer transaction must be reconciled between the delivering and receiving entities.
The Industry recommended practice is to cancel the original transfer transaction completely, and
submit a new transfer with correct transaction information. CBRS records from the original
transfer transaction should not be passed, or if already delivered, these records should be
deleted by the receiving entity as part of the cancellation. The fund or firm should not attempt
to send CBRS records for a cancellation or correction of a transaction in an attempt to cancel out
or correct previously sent CBRS records. In all cases, after a cancellation is complete, a correct
or new transfer transaction and corresponding new CBRS records will then be passed.
A firm may initiate a transfer cancelation/correction by submitting a letter of instruction to the
fund. The letter should reference the original transfer control number assigned to the ACATS
PTF, Networking, or manual transfer to be canceled. Alternatively, a fund may determine a
transfer needs to be adjusted or canceled and will initiate the cancelation/correction process.
In either case, the fund should generate a Networking F55 Activity record notifying the firm that
the correction/cancellation has been processed. This is accomplished through use of the
following Networking Transaction Types (Important Notice A7256):
1
Field Name
Start
End
Len
Type
Description
Transaction Type
23
24
2
A/N
33 = Transfer From – Cancellation
34 = Transfer To - Cancellation
In addition to other required fields, the F55 record should also contain the Original Control
Number and Original Control Number Indicator that corresponds to the original transfer
transaction that is being canceled.
When the correction is processed, a new transfer transaction and corresponding CBRS records
are generated. The new transfer transaction should be processed using a new Control Number,
and new CBRS records will reference only the new Control Number.
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 Industry Recommended Practice: Industry recommended practice when correcting a transfer
transaction is to cancel the original transfer transaction and deliver a (to and from) transfer
cancelation using the Networking F55 Activity record utilizing the appropriate Transfer Cancelation
transaction types.
The original transaction is then voided by both parties, any impact from previously-exchanged
CBRS records are deleted from both the delivering and receiving entities cost basis systems, and a
subsequent new transfer transaction and related CBRS records are transmitted.
This recommended practice applies to cancellations/corrections that affect all or a portion of the
original transfer and related cost basis records.
Additional information on cancelations/corrections also may be found in Section 3 (Special
Considerations – Transfer Statement Corrections) of this guide.
5.1.3 CBRS Record Layouts
The annotated CBRS record layouts and recommended practices for mutual funds are located in
Section 4 of this guide. The detailed CBRS record layouts, other guides and documentation may
be accessed on DTCC’s website at: http://www.dtcc.com/products/documentation/cs/cbrs.php.
5.1.4 WebDirect
WebDirect provides DTCC participants with direct access to DTCC’s various services and systems
by using a standard Internet browser. WebDirect is primarily a menu-driven and transactionoriented data entry application. Each participant is provided with a customized menu of
applications.
WebDirect allows members that have not programmed for an automated connection to CBRS to
utilize data-entry screens and Excel upload/download functionality to send and receive cost basis
information through this secure web-based service.
Specific instructions on how to utilize CBRS and WebDirect are contained in the CBRS User
Guide located on DTCC’s website at:
http://www.dtcc.com/products/documentation/cs/cbrs/CBRS_user_guide.pdf.
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5.1.5 Cost Basis Reporting Transfer Types and Examples
The following sub-sections provide greater detail about the transfer types supported by CBRS.
Each sub-section outlines the unique or special characteristics and recommended practices for
the applicable transfer category. The final sub-section provides specific examples that illustrate
how the cost basis information is transferred via the CBRS Asset and Tax lot records, and
highlight data populated that will vary based on the transfer transaction types. The sub-sections
are organized as follows:
5.2: ACATS PTF Transfers – ACATS PTF “Pull” (the firm requests assets from the fund)
and ACATS PTF “Push” (the firm sends assets to the fund) processes.
5.3: Networking Transfers - Firm initiated transfers for networked accounts.
5.4: Manual Transfers – Requests/instructions to transfer mutual fund shares are
processed manually; however the transfer of cost basis information is facilitated
through CBRS.
5.5: Examples – CBRS Asset and Tax Lot records are populated for transfer examples
utilizing the various cost basis methods for mutual fund securities. The examples
presented highlight details for the transfer types indicated above, as well as for
populating tax lot records for gifted and inherited transactions.
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5.2.1 Introduction
The ACATS-Fund/SERV Mutual Fund Transfer Capability, known as “ACATS PTF” was developed
to eliminate manual processing of transfers in kind between fund companies and firms in order
to improve processing efficiencies and complete such transfers in a timely manner. The ACATS
PTF process is different from “Networking” and "Manual Transfers," as it leverages the existing
Automated Customer Account Transfer (ACAT) and ACATS-Fund/SERV interfaces. The ACATS
PTF process is fully described in the “Fund/Firm Transfer Capability User Guide – Best Practices”,
available to NSCC members only on the DTCC website at
http://www.dtcc.com/products/wealthmgmt/members/downloads/Fund_Firm_Transfer_Capabilit
y.pdf. Those who are not members of NSCC but would be interested in knowing more about
the ACATS PTF transfer process should contact DTCC Relationship Management at
www.dtcc.com.
This sub-section summarizes the two ACATS PTF transfer scenarios and captures the
recommended practices for cost basis transfer reporting utilizing CBRS. Both of the ACATS PTF
transactions illustrated below are initiated by a firm through ACATS. The ACATS PTF “Pull” is
where a firm is requesting a mutual fund asset transfer from a fund-controlled account into a
firm-controlled account. The ACATS PTF “Push” refers to a firm transferring assets from a firmcontrolled account into a fund-controlled account.
A description of the ACATS PTF asset transfer scenarios, related workflows, industry practices
and special considerations for cost basis transfer reporting are detailed below.
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5.2.2 ACATS PTF - Firm Initiated In-Kind Transfer (“Firm Pull”)
Situation: Client owns shares directly with the Mutual Fund Company (Matrix level 0 (nonnetworked) or level 4) in a retirement account or non-retirement account, and wishes to transfer
those positions in-kind to a broker/dealer or bank. Client completes all required transfer forms
and requests broker dealer/bank to begin the transfer process.
Preconditions: • Account exists at firm. • CUSIP is ACATS-Fund/SERV eligible. • Both Firm and
Fund participate in the ACATS-Fund/SERV Mutual Fund Transfer Capability (ACATS PTF).
 Industry Required Practice: The receiving firm should never initiate a Gift Transfer using the
ACATS PTF “Pull” process. If a (receiving) firm initiates a Gift Transfer using the ACATS PTF “Pull”
process, the NSCC will reject the transaction (see NSCC Importance Notice #a7256).
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5.2.3 ACATS PTF - Firm Initiated In Kind Transfer to Fund (“Firm Push”)
Situation: Client owns shares of a fund at a broker/dealer in a retirement account or nonretirement account (Matrix level 3 or omnibus) and wishes to transfer those positions in-kind to
a Mutual Fund Company (Matrix level 0 (non-networked) or level 4).
Preconditions: • Account must exist directly at the Fund before the transfer can be initiated. •
CUSIP is ACATS-Fund/SERV eligible. • Both Firm and Fund Company participate in the ACATSFund/SERV Mutual Fund Transfer Capability.
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5.2.4 Special Considerations for ACATS PTF Transfers
Fund Rejects
If the ACATS PTF in either a “Pull” or “Push” scenario is rejected by the fund, a Fund/SERV 019
record is sent back to NSCC indicating the reject code. NSCC sends the same reject code to the
firm via the ACATS Output Fund/SERV Statistics file (SIAC720 - variable, SIAC726 - fixed). Cost
basis information should never be transmitted if a transfer was rejected via the 019 record.
Most firms treat the "reject" as a cancelled item. Any new transfer attempt for the same account
could be handled as a new ACATS PTF transfer or as a manual transfer as described in the
Manual Transfers sub-section of this Guide.
Resubmitting the new transfer as an ACATS PTF is preferred when possible. The new PTF
transfer will receive its own Fund/SERV control number that should be used for the CBRS
Transfer Control Number value.
Exception Processing or Errors
As with other transfer transactions, industry practice for ACATS PTF corrections is to reverse the
entire transaction and reprocess a correct transaction separately. For example, if a PTF is
processed against a wrong account, the error should be corrected by a full reversal of the
original transaction and not corrected as a subsequent PTF to put the shares in the correct
account. Such action creates challenges for correctly moving cost basis.
When processed as a full reversal, the correcting parties will reinstate the prior basis as if the
transaction did not occur, whereas a correction via PTF would result in the expectation of a cost
basis record. Further details on “Exception/Correction Processing” are contained in the
Transfers Overview sub-section at the beginning of this chapter and in Section 3 (Special
Considerations - Transfer Statement Corrections) of this guide.
3rd Party Mutual Fund Agent Processing
Firms may leverage a 3rd Party Mutual Fund Agent (Agent) to clear/custody their mutual fund
assets. In these situations the firm is responsible for the tax reporting, including the cost basis
reporting obligation, not the clearing agent. The originating firm initiates the ACATS PTF transfer
through its third-party Agent, and the applicable ACATS FR record will identify the Agent’s firm
number and account number.
When a Mutual Fund Agent is associated with a transaction, the “Originating Delivering Firm
Number” and “Originating Receiver Firm Number” fields (which correspond to the existing ACATS
PTF/TI fields of the same name) should be populated in order to identify the party or underlying
firm that is responsible for sending or receiving cost basis. When either of these fields is
populated, the data identifies the firm (or contra-party) for the cost basis transfer reporting
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associated with the transaction. Otherwise, the transfer statement should be directed to the
“Firm Number” on the ACATS or ACATS-Fund/SERV transaction.
The Fund/SERV 018 record will identify the originating firm number and account number as well
as the firm number and account number for the 3rd party agent. This enables the fund to
complete cost basis transfer with the originating firm (as deliverer or receiver), while the asset
transaction continues with the 3rd party agent.
Omnibus Processing and Underlying Firm Account Number
(Fund to Firm “Pull”)
Firm participants receiving assets from fund companies should include the "Underlying Client
Account Number" on the ACATS (TIF) Transfer Initiation Form record. NSCC will populate the
"Originating Receiver Account Number at Firm" field on the ACATS-Fund/SERV Transfer Record
(018) that is sent to the fund company.
The fund should ensure the “Originating Receiver Account Number at Firm” is carried through to
the ACATS Fund/SERV Transfer Acknowledgement/Rejection (019) and also to the corresponding
CBRS Records for cost basis transfer.
Transfer Control Number
Fund companies receive a 15 bytes alpha numeric control number on the ACATS Fund/SERV
Transfer record (018). This number is returned on the ACATS Fund/SERV Transfer
Acknowledgement/Rejection (019) record (Example: CATSA1234567890). The field is located in
Position 45-59 (Variable) or Record 1, Position 41-55 (Fixed) on the Fund/SERV 018 record.
For firms, the Transfer Control Number is an 11 byte number, comprised of the last 11
characters of the ACATS Fund/SERV control number. (Example: A1234567890) The field is
located in Position 153-163 (Variable) or Record 3, Position 8-18 (Fixed) of the ACATS Output
Fund/SERV Statistics file (SIAC720 - variable, SIAC726 - fixed). NSCC adds the letters ‘CATS’ to
the ACATS Control Number to create the ACATS Fund/SERV Control Number, which is necessary
due to differences in required field lengths for the respective systems’ control numbers.
The differences in Control Numbers must be managed in the context of CBRS. When a PTF
“Pull” is processed the firm is receiving cost basis information. Firms should add “CATS” to the
ACATS Fund/SERV Control Number on their expectancy record. When a PTF “Push” is processed
the firm is delivering cost basis information. Firms should populate the ACATS Fund/SERV
Control Number in the Transfer Control Number field on the Asset and Tax lot records to meet
the CBRS requirements for populating the Transfer Control Number. The Transfer Control
Number field is located in position 10-39 on the Cost Basis Asset and Tax Lot records.
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
Industry Recommended Practice: Firms should use the ACATS Fund/SERV Control number
from the ACATS Output Fund/SERV Statistics file, and add the letters ‘CATS’ to the front of it,
when building their expectancy files for Cost Basis Asset and Tax Lot Records. This will permit
consistent matching with the CBRS requirements for the Transfer Control Number field of the
CBRS records that will be received.
For Transaction types 46=Fund to Firm Mutual Fund Transfer
or 51=Firm to Fund Mutual Fund Transfer the Alternate Control Number field on the Asset and Tax
Lot records must be populated with the ACATS Control Number.
Timing Considerations for CBRS Record Delivery
When current CBRS workflows for the ACATS PTF process were reviewed, a timing gap was
identified with respect to the delivery of tax lots from fund to firm. The timing issue occurs
between when funds typically would send CBRS information, and when firms typically would be
ready to receive it.
When funds process an ACATS-Fund/SERV transfer, their systems are often prepared to send
tax information on the business day following the posting of the transfer to the transfer agency
system (T+1). Many brokerage systems, however, are not ready to receive cost basis records
until after they have received notification that the transfer has been processed by the fund, and
such updates have been committed to their systems (T+2).
Because of the timing of when the notification through the ACATS Output Fund/SERV Statistics
File is received, funds run the risk of sending cost basis information before firms can construct
their cost basis transfer expectancy file. While some brokerage systems can compensate for
this situation, others would either reject CBRS information as not matched to an expectancy file,
or the firm would capture records received on reports for manual exception review and data
entry. Both of these outcomes would result in significant processing inefficiencies and costly
rework for cost basis transfer work flow, adversely impacting both firms and funds.

Industry Recommended Practice: For ACATS PTF transfers, funds should make every effort to
deliver CBRS data to the DTCC after 4:00 p.m. ET and before 8:00 p.m. ET on the day following
transfer processing (T+1). Delaying the delivery to this timeframe will eliminate the need for
funds to change dates associated with the delivery of CBRS data on files, and delivery to firms will
occur on T+2. This should allow sufficient time for firms to construct cost basis expectancy files to
avoid timing-related rejects and manual processing of CBRS data. (Note: Most funds that
provided input on the recommended industry practice will delay delivery of ALL CBRS data, and
not just those that are ACATS PTF-related.)
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5.3.1 Introduction
Networking is the industry standard for account reconciliation and dividend processing. Through
Networking, all customer account-level information – either in an omnibus or non-omnibus
environment – can be exchanged and reconciled between firms and fund companies, allowing
identical information to appear on all parties’ records. 25
24F
Networking B50 (new account) and B52 (transfer) functionality may also be used to facilitate
transfer processing between firms and funds, and to facilitate matching and reconciliation of cost
basis data. This method, however, does not generally support all types of transfers or all types
of accounts. Additional Networking fields also allow participants to communicate underlying
sub-account information for transfers into or out of an omnibus account. Finally, a special
Networking “mass broker-to-broker” process permits large quantities of firm-initiated transfers
to move from one firm to another firm’s control. In some cases, such activity requires special
systems permissions to be enabled prior to processing these types of transfers.

Industry Recommended Practice: NSCC’s Networking service provides functionality that
enables a Networking Maintenance B51 record to process a matrix level change on an account
held at the fund. In some cases the B51 Maintenance requested changes the control of the
account and the tax reporting responsibility. Therefore, any networking maintenance change on
an account that would change the existing tax reporting responsibility on mutual fund shares
should be processed through a transfer transaction and not by utilizing the Networking
Maintenance B51 record.
This section provides an overview of the two networking transfer scenarios and related
workflows and guidance on:

Both inbound and outbound considerations with regard to movement of cost basis
information; and

Special considerations specifically related to networking transfers.
25
Additional details regarding networking transfers can be found in the user guide available to NSCC
members only on the DTCC website at
http://www.dtcc.com/products/wealthmgmt/members/downloads/16434Networking_Tech.pdf. Those who
are not members of NSCC but would be interested in knowing more about the Networking process should
contact DTCC Relationship Management at www.dtcc.com.
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5.3.2 Overview – Networking Transfers
The scenarios below include a networking transfer moving shares from a fund to a firm, and also
a “de-networking” transfer moving shares from a firm to direct at fund. Detailed examples of
networking transfers, including sample data populated on the related CBRS records, are included
in the Examples sub-section at the end of this chapter.
Please note the following flows do not include mass broker to broker transfers or level 3 to level
3 transfers. Additionally, Matrix level changes between levels 3 and 4 for the same firm account
where the tax reporting responsibility changes should be handled outside of this process using a
method agreed upon by the firm and fund. For Matrix level 3 to 4 changes involving the same
account, most fund systems restrict the number of accounts in which the same Broker
Identification Number (BIN) can be assigned within the same CUSIP. As a result, the automated
transfer through Networking fails.

Note: In both networking scenarios, and as with all transfers, cost basis transfer statements are
to be delivered within 15 calendar days from the transaction’s completion date.
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5.3.3 Firm Initiated Networking Fund to Firm Transfer
Situation: The submitting firm has established a new account by submitting a Networking
Account Conversion Record B50 to the fund (networked) or to the sub accounting/omnibus
provider (omnibus). The submitting firm then submits a B52 Networking transfer request to
move the shares from a fund direct/level 0 (non-networked) account to the firm controlled
networked or omnibus account.
Preconditions: • Account exists at firm. • CUSIP is NSCC eligible. • Fund company and firm are
participating in Networking.
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5.3.4 Firm Initiated De-Networking Firm to Fund Transfer
Situation: The submitting firm has established a new fund direct/level 0 (non-networked)
account by submitting a Networking Account Conversion Record B50 to the fund (networked and
omnibus). The submitting firm submits a Networking B52 transfer request to move the shares
from the firm controlled networked or omnibus account, to the newly established direct/level 0
fund account.
Preconditions: • Account exists at firm. • CUSIP is NSCC eligible. • Fund company and firm are
participating in Networking.
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5.3.5 Special Considerations for Networking
Agent for Firm
Originating or Introducing Firms may leverage a 3rd Party Mutual Fund Agent (Agent) to
clear/custody their mutual fund assets. In these cases the tax reporting, and therefore cost
basis reporting obligation, is the responsibility of the introducing firm, not the 3rd Party Mutual
Fund Agent. The introducing firm, if applicable, is typically defined in NSCC records as the
“Agent for Firm.”
Some Clearing Firms will define their introducing firms in the Agent for Firm field by using a
unique 4 character value. Other Clearing Firms will define the value using the available NSCC
Firm Number for their originating or introducing firms. Within Networking, there are no NSCCdefined values to specifically identify whether an Agent for Firm number is either the NSCC Firm
Number for the introducing firm or a number that has been generated by the clearing firm.
Therefore, with a Networking transfer (B52), the Agent for Firm field cannot be utilized for
sending or receiving cost basis information for transfer reporting because it may not be a valid
NSCC firm number. Thus the Clearing/Settling Firm Number field will be used to identify the
firm that should receive or send the cost basis information on a transfer statement. It will be the
responsibility of Clearing Firms to direct transfer statements received to their introducing firms.
Mass Broker to Broker Conversions
Firms have the option of using the Mass Broker to Broker Conversion feature in Networking to
expedite bulk movement of accounts from one Firm to another as recorded on the fund transfer
agent system.
Mass Broker to Broker Conversions can be accomplished in an automated and
controlled environment through the Account Set-Up/Update/Transfer and Acknowledgment
function in Networking. Typically, the delivering firm initiates the transfer record (B52 with a
Transaction Type 4). Due to timing of the passage of cost basis data systematically, the mass
broker to broker process should be discussed between the parties as data can also be passed
outside of the DTCC CBRS system if necessary.
Both the delivering and receiving firms involved in a Mass Broker to Broker Conversion receive
the same F53 transfer acknowledgement record from the fund. Such information will be helpful
for the receiving firm to create cost basis expectancy records.
The Use of Networking and Cost Basis Expectancy
Many Firms have created Cost Basis expectancy processes, which cross multiple trading
platforms that interface with brokerage systems. Networking output provides much of the
information that firms require to create cost basis expectancy records for both Networking and
Manual mutual fund transfers.
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
Fund Transfer Acknowledgement Record (F53): This record is received by firms in
response to a Firm Transfer Detail Record (B52) and provides the corresponding Control
Number and related transaction details (account number(s), shares transferred, etc.),
which will be used by the delivering party when generating CBRS records for the related
transfer. In the case of Mass Broker to Broker Conversions, which are initiated by either
the delivering or receiving firm, both parties will receive the same F53. This validates
both parties have the key identifiers to effect the CBRS transfer movement.

Fund Activity Detail Record (F55): This record is received by a firm in response to
Manual Transfers (Networking Transaction Type 13) and Transfer Cancellations
(Networking Transaction Types 33 and 34). Please refer to the sub-section on Manual
Transfers in this chapter for details on the use of the F55 to effect the CBRS transfer
movement.
Exception/Correction Processing
Following a Networking fund to firm or De-Networking firm to fund full or partial transfer, a fund
or firm may need to cancel/correct the actual transfer transaction (e.g. to correct the number of
shares). Any cancelation or correction to a previously posted transfer transaction must be
reported to the firm. The Industry recommended practice is to cancel the original transfer
transaction completely, and to submit a new transfer for the correct number of shares, etc. No
CBRS records are passed as a result of the cancel. If the original corresponding CBRS
records have been sent, they should be voided by both parties and deleted from cost
basis tracking systems. When the correction is processed new CBRS records for the new
transfer transaction will be passed.

Industry Recommended Practice: Industry recommended practice when correcting a transfer
transaction is to cancel the original transfer transaction and deliver a (to and from) transfer
cancelation using the Networking F55 Activity record utilizing the appropriate Transfer Cancelation
transaction types.
The original transaction is then voided by both parties, any impact from previously-exchanged
CBRS records are deleted from both the delivering and receiving entities cost basis systems, and a
subsequent new transfer transaction and related CBRS records are transmitted.
This recommended practice applies to cancellations/corrections which affect all or a portion of the
original transfer and related cost basis records.
A firm may initiate a transfer cancelation/correction by submitting a letter of instruction to the
fund. The letter should reference the original B52/F53 control number. Alternatively, a fund
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may determine a transfer needs to be corrected or canceled and initiate the
cancelation/correction. In either case, the fund should generate a Networking F55 Activity
record notifying the firm of the event. In addition to other required fields, the F55 records
should contain the following information:

Transaction Type
o
33 = Transfer From – Cancellation (to cancel a ‘firm to fund’ transfer), or
o
34 = Transfer To - Cancellation (to cancel a ‘fund to firm’ transfer)

Original Control Number Indicator value of 2=Networking Control Number

Original Control Number = NSCC Control # from the original B52/F53 transfer
When processing the new or correct transfer transaction, a new B52 transfer and corresponding
CBRS records will be generated. The B52 will be assigned a new NSCC Original Control Number,
and the new CBRS records passed will reference only the new NSCC Control Number.
Further details on “Exception/Correction Processing” are contained in the Transfers Overview
sub-section at the beginning of this chapter and in Section 3 (Special Considerations - Transfer
Statement Corrections) of this guide.
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5.4.1 Introduction
While progress has been made to eliminate manual transfers within the mutual fund industry, it
remains a common practice for funds to manually process account transfers at the request of
delivering/receiving firms. Requests for manual transfers are typically submitted by a firm to
the fund in the form of an instruction or "transfer log." The transfer request will typically
originate from an omnibus firm when shares are moving from a fund to a firm omnibus account.
Transaction adjustments initiated by a fund company may also result in manual transfer
transactions.
Every effort should be made to transfer mutual fund securities using automated means in lieu of
transferring shares manually. However, in the event a manual transfer must be processed, it is
recommended that firms update their manual transfer instruction forms to include additional
information, which is necessary to increase transparency, processing efficiency, and facilitate the
transfer of cost basis information via CBRS. Use of the underlying customer account number
(where applicable), a common control number on the transaction and the related CBRS records,
and Mutual Fund Agent CBRS information will help recipients identify the transaction and
accounts to which the CBRS records apply. The additional information provided permits
automation of the expectancy and reconciliation processes for Cost Basis transfers.

Industry Recommended Practice: Firms should update their manual transfer instruction forms
to include the following information:
1.
Underlying customer account number, when applicable.
2.
Either the original ACAT, Fund/SERV, or Networking control number or the manual transfer
(fund/firm) generated control number (also known as “original control number”).
3.
Mutual Fund Agent CBRS information when utilizing a firm other than the share transfer
recipient to track customer cost basis
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5.4.2 Overview
The three primary types of manual transfer scenarios addressed in this section include:
1) A manual transfer moving shares from a fund to a firm,
2) A manual transfer moving shares from a firm to a fund, and
3) A manual transfer moving shares from one firm to another firm.
The terms “Firm” or “Intermediary” in the scenarios below represent transfers of Broker/Dealer
(Level 3, or Omnibus) and Trust Networked (Level 0) accounts.
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1.
Manual Transfer - Fund to Firm
Situation: An ACAT Fund/SERV PTF Pull or Networking B52 transaction has failed and cannot
be completed systematically by the fund. The submitting firm sends a manual transfer log to
the fund company to move shares from a fund controlled account to a firm controlled account.
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2.
Manual Transfer - Firm to Fund
Situation: An ACAT Fund/SERV PTF Push or Networking B52 transaction has failed and cannot
be completed systematically by the fund. The submitting firm sends a manual transfer log to
the fund company to move shares from a firm controlled account to a fund controlled account.
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3.
Manual Transfers - Firm to Firm
Situations: There are two Firm to Firm manual transfer scenarios depicted in the workflow
which follows:
a) Fails: An ACAT transfer or Networking B52 transfer has resulted in a fail. The
delivering firm submits a manual transfer log to the fund company to move shares
from a firm controlled account to another firm controlled account.
b) Non-ACAT Transfers: One or more of the transferring firms is not an ACAT
participant and the transfer is processed outside of the ACATS system. Typically the
receiving firm establishes a (receiving) account at the fund and provides reregistration information to the delivering firm. Then the delivering firm sends a reregistration letter to the fund company to move shares from their firm controlled
account to the receiving firm (controlled) account that’s been established.
For firm to firm ACAT failed items, the delivering firm most likely has already sent cost basis to
the receiving firm. For failed Networking B52 transfers or non-ACAT firm to firm mutual fund
manual transfers, the delivering firm should send cost basis when the fund company has
confirmed shares have moved to the firm controlled account via the Networking F55. The
receiving firm should expect cost basis once the fund has confirmed that the shares have moved
into the firm controlled receiving account via the Networking F55.
The fund company will provide a control number on the F55, which is either the control number
provided by the firm with the re-registration letter, or a fund generated manual transfer control
number (also known as an original control number). The same control number should be
utilized by both the delivering and receiving firm for populating and retrieving the related CBRS
records.
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5.4.3 Special Considerations for Manual Transfers
Control Numbers for Manual Transfers
When a manual transfer is requested by a firm for a rejected Networking or ACATS-Fund/SERV
transfer (which is referred to on the NSCC F55 Activity Record as transaction type 13 or a
“Direct” transfer), the industry recommended practice is to provide the Control Number
associated with the rejected transfer in the “Original Control Number” field on the F55 Activity
Record. In addition, the “Original Control Number Indicator” field should be populated (on the
F55 Activity Record) with the applicable indicator value (“1” for Fund/SERV Control Number or
“2” for Networking Control Number).
When the "Control/Reference Number Indicator" is populated on the NSCC F55 Activity Record
with a “1,” NSCC will validate that the value supplied in the “Original Control Number” field
follows the required format for a Fund/SERV control number. If the "Control/Reference Number
Indicator" is populated with a value of “2” the NSCC will validate that the value supplied in the
“Original Control Number” field follows the format for a Networking Control Number. If the
supplied control number does not follow the appropriate format, the F55 Activity record will be
rejected.
If a Control Number is not provided by the requesting firm, or for a manual (or direct) transfer,
the fund should populate the F55 Activity Record with a fund “Originated Control Number” (the
manual transfer (fund generated) control number) and the “Original Control Number Indicator”
field should be updated with a value of ”3” for the “Manual Reference Number.” The manual
transfer (fund generated) control number will not be validated by NSCC when the Original
Control Number Indicator is “3.”
TRANSFERS OF MUTUAL FUND SECURITIES > 86
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds

Industry Recommended Practice: When a control number is not provided by a firm as part of
the manual (direct) transfer instructions, the Fund should generate and reference a Manual
Transfer Control Number in the Original Control Number field that is created by using the following
algorithm:
Position
Length
Field Description
Value
1
1
Direct transfer indicator
D
2
4
NSCC member number for
9999
the fund
6
1
Last digit of current posting
9
year for the transfer
transaction
7
3
Posting date of the transfer
999
transaction in Julian date
format
10
6
Unique number (random-
999999
generated, sequential)
This number should be provided as the Original Control Number on Record 4, Position 23-37 of the
Networking F55 record, plus as the Transfer Control Number for all related CBRS records.
Utilizing the same control number on the transaction and the related CBRS records will help
recipients identify the transaction and accounts to which the CBRS records apply. This permits
automation of the expectancy and reconciliation processes for Cost Basis transfers. The
transaction activity and subsequent CBRS information can easily be linked together to efficiently
fulfill transfer statement reporting obligations.
ACAT PTF Transfer Ages to Reject
It should be noted for firms that if an ACAT PTF Transfer Ages to Reject (NSCC Code 600), no
cost basis should be expected or sent. If the next transfer request processed is done manually,
the requirement to send or expect to receive basis should be treated as a separate or new event
for that specific manual transfer.
TRANSFERS OF MUTUAL FUND SECURITIES > 87
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Exception/Correction Processing
Details on “Exception/Correction Processing” for manual transfers and other transfer types are
contained in the Transfers Overview sub-section at the beginning of this chapter and in Section
3 (Special Considerations - Transfer Statement Corrections) of this guide.
TRANSFERS OF MUTUAL FUND SECURITIES > 88
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
This section provides examples that illustrate several scenarios that will trigger the exchange of
cost basis data through CBRS. The examples below include shareholder transfers that involve
Average Cost, FIFO, Gifted Shares, and Inherited Shares. The examples also illustrate transfer
transactions that originate from ACATS Fund/SERV PTF, Networking, and manual processing that
result in a change in tax reporting responsibility (i.e., "fund to firm" or "firm to fund"). Cost
basis information must be passed when the tax reporting responsibility for an account changes
as a result of a transfer.
The cost basis data provided in the examples below include lot details for the "from" account,
followed by data populated in the CBRS record layouts that will be systematically transmitted to
the recipient’s account via CBRS. The examples also include the common fields from CBRS that
must be populated, regardless of the transfer method. Additionally, specific fields that must be
populated based on the transfer method are also highlighted in the examples below.
Information regarding exception/corrective processing is also included in this section.
Specifically, the lot details and corresponding codes that should be used to cancel an original
transfer transaction are summarized below.
Examples
5.5.1. Example A - Average Cost
a.
Common Fields for Asset & Tax Records
b.
ACATS Fund/SERV PTF Pull Specific Fields
c.
ACATS Fund/SERV PTF Push Specific Fields
d.
Networking Fund to Firm Specific Fields
e.
De-Networking Firm to Fund Specific Fields
f.
Manual Transfer Specific Fields
5.5.2. Example B - Gifted Shares for FIFO Account
a.
Common Fields for Asset & Tax Records
b.
ACATS Fund/SERV PTF Pull Specific Fields
c.
ACATS Fund/SERV PTF Push Specific Fields
d.
Networking Specific Fields
e.
Manual Transfer Specific Fields
5.5.3. Example C - Inherited Shares for FIFO Account
a. Common Fields for Asset & Tax Records
b. ACATS Fund/SERV PTF Pull Specific Fields
c. ACATS Fund/SERV PTF Push Specific Fields
d. Networking Specific Fields
e. Manual Transfer Specific Fields
TRANSFERS OF MUTUAL FUND SECURITIES > 89
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.4. Exception/Correction Processing
5.5.1 Average Cost
Example A - Average Cost: On February 2, 2013, level 3 firm 9999 moves 500 shares from a
direct at fund account at Fund Company 8819 (account number 1029384756) into its level 3
firm controlled account (987654321). The transfer is not a gift. The security issue is identical on
both sides. In addition to Fund/SERV and Networking, both 9999 and 8819 participate in CBRS.
The shareholder’s cost basis (lot disposition) method is average cost and the revocation period
(for choosing another method for existing shares) has ended. For the PTF Push (firm to fund)
and the De-Networking (firm to fund) scenarios below, this transfer will move in the
opposite direction - from a firm controlled account to a fund controlled account held
within the same fund company.
The detailed tax lots currently held by the shareholder at Fund Company 8819 that will be used
in the subsequent scenarios are:
Lot
Transaction
Acquisition
Tax Lot
Price
Purchase
Share
Share
Account
Average
No.
Type
Date
Shares
Per
Cost
Balance
Type
Cumulative
Cost Per
Cost Basis
Share
Share
(NAV)
1
Purchase
6/1/2011
200.000
$5.27
$1,054.00
200.000
Non-
$1,054.00
$5.27
$1,578.00
$5.26
Covered
2
Purchase
12/1/2011
100.000
$5.24
$524.00
300.000
NonCovered
BEGINNING IN 2012, A SEPARATE AVERAGE COST PER SHARE IS CALCULATED FOR THE COVERED SHARES
3
Purchase
12/1/2012
100.000
$5.26
$526.00
400.000
Covered
$526.00
$5.26
4
Dividend
12/31/2012
50.000
$5.08
$254.00
450.000
Covered
$780.00
$5.20
5
Purchase
2/1/2013
200.000
$5.11
$1,022.00
650.000
Covered
$1,802.50
$5.15
The following tax lots are used, either fully or partially, to support the February 2, 2013 partial
transfer out of 500 shares. Only 50.000 shares are used from Lot 5 below:
TRANSFERS OF MUTUAL FUND SECURITIES > 90
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Lot
Acquisition
Tax Lot
Price per
Tax Lot Current
Non-
No.
Date
Quantity
Share
Cost Basis
Covered/
Pending
1
6/1/2011
200.000
$5.26
$1,052.00
01
2
12/1/2011
100.000
$5.26
$526.00
01
3
12/1/2012
100.000
$5.15
$515.00
4
12/31/2012
50.000
$5.15
$257.00
5
2/1/2013
200.000
$5.15
$1,030.00
As a result of the successful transfer transaction, which moves shares to Firm 9999, Fund
Company 8819 prepares a CBRS transfer statement and systematically generates a CBRS file
that is sent to Firm 9999.
5.5.1. a.
Common Fields Populated on the CBRS Record Layouts
The following details the common fields that need to be populated on the Asset Record and
five Tax Lot Records required to be sent for this transfer example, regardless of the method of
transfer (ACATS Fund/SERV PTF, Networking, or Manual).
Asset Record
FIELD NAME
Record Content
VALUE
FIELD NAME
01
Total Position
Indicator
Position Code
VALUE
500,000
FIELD NAME
Asset Category
VALUE
MFNM
Quantity
L
Settlement Date
20130202
of Transfer
Asset
Name of
ISIN Security
Description
Fund
Issue ID (CUSIP)
ISIN Country
US
Code
Fund
CUSIP
Disposition
Method Used
05
(Average
Cost)
TRANSFERS OF MUTUAL FUND SECURITIES > 91
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the five separate tax lots related to the Asset Record
FIELD NAME
VALUE –
VALUE –
VALUE –
VALUE –
VALUE –
TAX LOT 1
TAX LOT 2
TAX LOT 3
TAX LOT 4
TAX LOT 5
01
01
01
01
01
ISIN Country Code
US
US
US
US
US
ISIN Security Issue
Fund
Fund
Fund
Fund
Fund
ID (CUSIP)
CUSIP
CUSIP
CUSIP
CUSIP
CUSIP
Asset Description
Name of
Name of
Name of
Name of
Name of
Fund
Fund
Fund
Fund
Fund
01
01
Tax Lot Quantity
200,0000
100,0000
100,0000
50,0000
50,0000
Position Code
L
L
L
L
L
Acquisition Date of
20110601
20111201
20121201
20121231
20130201
1052,00
526,00
515,00
257,50
257,50
Record Content
Indicator
NonCovered/Pending
Indicator
Tax Lot
Tax Lot Current
Cost
TRANSFERS OF MUTUAL FUND SECURITIES > 92
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.1. b.
ACATS Fund/SERV PTF Pull Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and five Tax Lot Records if the transfer was
facilitated through ACATS Fund/SERV as a PTF Pull (shares moving from a fund controlled
account to a firm controlled account).
Asset Record
FIELD NAME
Transaction
VALUE
46
Type
FIELD NAME
Transfer Control
Number
VALUE
Fund/SERV
Control
FIELD NAME
Alternate
ACATS
Control Number
Control
Number
Submitting
NSCPRT
Firm Type
Submitting
Firm Number
8819
Submitting Firm
1029384756
Number
Receiving Firm
Customer
Customer
Account Number
Account Number
Contra Firm
Number
9999
VALUE
Contra Firm
Type
TRANSFERS OF MUTUAL FUND SECURITIES > 93
987654321
DTCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the five separate tax lots related to the Asset Record
FIELD
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
NAME
LOT 1
LOT 2
LOT 3
LOT 4
LOT 5
Transaction
46
46
46
46
46
Transfer
Fund/SERV
Fund/SERV
Fund/SERV
Fund/SERV
Fund/SERV
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Alternate
ACATS
ACATS
ACATS
ACATS
ACATS
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Contra Firm
9999
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
DTCPRT
8819
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
NSCPRT
987654321
987654321
987654321
987654321
987654321
1029384756
1029384756
1029384756
1029384756
1029384756
Type
Number
Contra Firm
Type
Submitting
Firm
Number
Submitting
Firm Type
Receiving
Firm
Customer
Account
Number
Submitting
Firm
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 94
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.1 c.
ACATS Fund/SERV PTF Push Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and five Tax Lot Records if the transfer was
facilitated through ACATS Fund/SERV as a PTF Push (shares moving from a firm controlled
account to a fund controlled account).
Asset Record
FIELD NAME
VALUE
FIELD
VALUE
FIELD NAME
VALUE
NAME
Transaction
51
Type
Submitting
DTCPRT
Firm Type
Submitting
Firm
987654321
Transfer
Fund/SERV
Control
Control
Number
Number
Submitting
9999
Alternate
ACATS
Control Number
Control
Number
Receiving Firm
Firm
Customer
Number
Account Number
Contra Firm
Number
8819
Contra Firm
Type
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 95
1029384756
NSCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the five separate tax lots related to the Asset Record
FIELD
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
NAME
LOT 1
LOT 2
LOT 3
LOT 4
LOT 5
Transaction
51
51
51
51
51
Transfer
Fund/SERV
Fund/SERV
Fund/SERV
Fund/SERV
Fund/SERV
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Alternate
ACATS
ACATS
ACATS
ACATS
ACATS
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Contra Firm
8819
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
NSCPRT
9999
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
DTCPRT
1029384756
1029384756
1029384756
1029384756
1029384756
987654321
987654321
987654321
987654321
987654321
Type
Number
Contra Firm
Type
Submitting
Firm
Number
Submitting
Firm Type
Receiving
Firm
Customer
Account
Number
Submitting
Firm
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 96
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.1 d.
Networking Fund to Firm Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and five Tax Lot Records if the transfer was
facilitated through Networking as a B52 fund to firm transfer (shares moving from a fund
controlled account to a firm controlled account).
Asset Record
FIELD NAME
Transaction
VALUE
56
Type
FIELD NAME
Transfer Control
Number
VALUE
Networking
Control
FIELD NAME
Alternate
VALUE
Blank
Control Number
Number
Submitting
NSCPRT
Firm Type
Submitting
Firm Number
8819
Submitting Firm
1029384756
Receiving Firm
Customer Account
Customer
Number
Account Number
Contra Firm
Number
9999
Contra Firm
Type
TRANSFERS OF MUTUAL FUND SECURITIES > 97
987654321
DTCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the five separate tax lots related to the Asset Record
FIELD
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
NAME
LOT 1
LOT 2
LOT 3
LOT 4
LOT 5
Transaction
56
56
56
56
56
Transfer
Networking
Networking
Networking
Networking
Networking
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Alternate
Blank
Blank
Blank
Blank
Blank
9999
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
DTCPRT
8819
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
NSCPRT
987654321
987654321
987654321
987654321
987654321
1029384756
1029384756
1029384756
1029384756
1029384756
Type
Control
Number
Contra Firm
Number
Contra Firm
Type
Submitting
Firm
Number
Submitting
Firm Type
Receiving
Firm
Customer
Account
Number
Submitting
Firm
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 98
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.1 e.
De-Networking Firm to Fund Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and five Tax Lot Records if the transfer was
facilitated through Networking as a B52 firm to fund transfer (shares moving from a firm
controlled account to a fund controlled account).
Asset Record
FIELD NAME
Transaction
VALUE
56
Type
FIELD NAME
Transfer Control
Number
VALUE
Networking
Control
FIELD NAME
Alternate
VALUE
Blank
Control Number
Number
Submitting
DTCPRT
Firm Type
Submitting
Firm Number
9999
Submitting Firm
987654321
Receiving Firm
Customer
Customer
Account Number
Account Number
Contra Firm
Number
8819
Contra Firm
Type
TRANSFERS OF MUTUAL FUND SECURITIES > 99
1029384756
NSCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the five separate tax lots related to the Asset Record
FIELD
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
NAME
LOT 1
LOT 2
LOT 3
LOT 4
LOT 5
Transaction
56
56
56
56
56
Transfer
Networking
Networking
Networking
Networking
Networking
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Alternate
Blank
Blank
Blank
Blank
Blank
8819
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
NSCPRT
9999
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
DTCPRT
1029384756
1029384756
1029384756
1029384756
1029384756
987654321
987654321
987654321
987654321
Type
Control
Number
Contra Firm
Number
Contra Firm
Type
Submitting
Firm
Number
Submitting
Firm Type
Receiving
Firm
Customer
Account
Number
Submitting
987654321
Firm
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 100
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.1 f.
Manual Transfer Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and five Tax Lot Records in the case of the
transfer being processed manually (shares moving from a fund controlled account to a firm
controlled account).

Note: In most cases, the manual process is the result of a failed or rejected transfer originally
passed through NSCC and is being handled manually as a service. The Industry recommended
practice is to utilize the original control numbers from those transactions when processing these
transactions manually so that the receiver can reconcile the CBRS records with the Networking
F55 Activity.
Asset Record
FIELD NAME
Transaction
VALUE
57
Type
FIELD NAME
VALUE
FIELD NAME
Transfer Control
Fund/SERV,
Alternate
ACATS
Number
Networking,
Control Number
Control
or Fund
VALUE
Number
Originated
Control
Number
Control
Number
Submitting
NSCPRT
Firm Type
Submitting
Firm Number
8819
Submitting Firm
1029384756
Receiving Firm
Customer
Customer
Account Number
Account Number
Contra Firm
Number
9999
Contra Firm
Type
TRANSFERS OF MUTUAL FUND SECURITIES > 101
987654321
DTCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the five separate tax lots related to the Asset Record
FIELD
VALUE –
VALUE –
VALUE –
VALUE –
VALUE –
NAME
TAX LOT 1
TAX LOT 2
TAX LOT 3
TAX LOT 4
TAX LOT 5
Transaction
57
57
57
57
57
Transfer
Fund/SERV,
Fund/SERV,
Fund/SERV,
Fund/SERV,
Fund/SERV,
Control
Networking,
Networking,
Networking,
Networking,
Networking,
Number
or Fund
or Fund
or Fund
or Fund
or Fund
Originated
Originated
Originated
Originated
Originated
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Alternate
ACATS
ACATS
ACATS
ACATS
ACATS
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Contra Firm
9999
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
DTCPRT
8819
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
NSCPRT
987654321
987654321
987654321
987654321
1029384756
1029384756
1029384756
1029384756
Type
Number
Contra Firm
Type
Submitting
Firm Number
Submitting
Firm Type
Receiving
987654321
Firm
Customer
Account
Number
Submitting
1029384756
Firm
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 102
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.2. Gifted Shares for FIFO Account
Example B - Gift of Shares Using FIFO: On February 2, 2013, a shareholder gifts 450 shares
from a direct at fund account at Fund Company 8819 (account number 1029384756) into the
recipient’s firm controlled account (987654321) at firm 9999. Shares are not in physical form.
The security issue is identical on both sides. Both accounts use CBRS. The shareholder’s cost
basis (lot disposition) method is FIFO. The dividend was reinvested. Shares are priced at $5.32
on date of transfer.

Note: For the PTF Push (firm to fund) scenario below, this transfer will move in the opposite
direction - from a firm controlled account to a fund controlled account held within the same fund
company.
The detailed tax lots currently held by the shareholder at Fund Company 8819 that will be used
in the subsequent scenarios are:
Lot
Transaction
Acquisition
Tax Lot
Price Per
Purchase
Share
No.
Type
Date
Shares
Share (NAV)
Cost
Balance
1
Purchase
6/1/2011
200.000
$5.27
$1,054.00
200.000
Non-Covered
2
Purchase
12/1/2011
100.000
$5.24
$524.00
300.000
Non-Covered
3
Purchase
12/1/2012
100.000
$5.26
$526.00
400.000
Covered
4
Dividend
12/31/2012
50.000
$5.08
$254.00
450.000
Covered
5
Purchase
2/1/2013
$5.11
$1,022.00
650.000
Covered
200.000
TRANSFERS OF MUTUAL FUND SECURITIES > 103
Share Type
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
The following tax lots are used to support the February 2, 2013 full transfer out of 450 shares:
Lot
Acquisition
Tax Lot
Price per
Tax Lot Current
Non-
No.
Date
Quantity
Share
Cost
Covered/
Pending
1
6/1/2011
200.000
$5.27
$1,054.00
01
2
12/1/2011
100.000
$5.24
$524.00
01
3
12/1/2012
100.000
$5.26
$526.00
4
12/31/2012
50.000
$5.08
$254.00
As a result of the successful transfer transaction, which moves shares to the recipient’s account,
Fund Company 8819 prepares a CBRS transfer statement and systematically transmits CBRS
records to the recipient’s firm controlled account, thereby fulfilling its transfer statement
reporting requirement. It should be noted that the cost basis will reflect the original purchase
price of the covered shares and will look identical in both the “from” and “to” accounts. It is also
assumed that the date of transfer equals the date of the gift.
5.5.2. a.
Common Fields Populated on the CBRS Record Layouts
The following details the common fields that need to be populated on the Asset Record and
four Tax Lot Records required to be sent for this transfer example, regardless of the method of
transfer (ACATS Fund/SERV PTF, Networking, or Manual). The shares are priced at $5.32 on the
date of transfer.
Asset Record
FIELD NAME
Record Content
VALUE
FIELD NAME
01
Total Position
Indicator
Position Code
VALUE
FIELD NAME
450,0000
Asset Category
20130202
ISIN Country
VALUE
MFNM
Quantity
L
Settlement Date of
Transfer
Asset
Name of
ISIN Security Issue
Description
Fund
ID (CUSIP)
US
Code
Fund
CUSIP
TRANSFERS OF MUTUAL FUND SECURITIES > 104
Disposition
Method Used
01
(FIFO)
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the four separate tax lots related to the Asset Record
FIELD NAME
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
LOT 1
LOT 2
LOT 3
LOT 4
01
01
01
01
ISIN Country Code
US
US
US
US
ISIN Security Issue ID
Fund CUSIP
Fund CUSIP
Fund CUSIP
Fund CUSIP
Asset Description
Name of Fund
Name of Fund
Name of Fund
Name of Fund
Non-Covered/Pending
01
01
01
01
01
01
Date of Gift
20130202
20130202
20130202
20130202
Fair Market Value as of
1064,00
532,00
532,00
266,00
Tax Lot Quantity
200,0000
100,0000
100,0000
50,0000
Position Code
L
L
L
L
Acquisition Date of Tax
20110601
20111201
20121201
20121231
1054,00
524,00
526,00
254,00
Record Content
Indicator
(CUSIP)
Indicator
Gifted or Inherited
Indicator
Date of Gift
Lot
Tax Lot Current Cost
TRANSFERS OF MUTUAL FUND SECURITIES > 105
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.2. b.

ACATS Fund/SERV PTF Pull Specific Fields
Industry Required Practice: The receiving firm should never initiate a Gift Transfer using the
ACATS PTF “Pull” process. If a (receiving) firm initiates a Gift Transfer using the ACATS PTF “Pull”
process, the NSCC will reject the transaction. (See NSCC Importance Notice #a7256.)
5.5.2 c.
ACATS Fund/SERV PTF Push Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and four Tax Lot Records if the transfer was
facilitated through ACATS Fund/SERV as a PTF Push (shares moving from a firm controlled
account to a fund controlled account).
Asset Record
FIELD NAME
VALUE
FIELD
VALUE
FIELD NAME
VALUE
Alternate
ACATS
Control Number
Control
NAME
Transaction
51
Type
Submitting
DTCPRT
Firm Type
Submitting
Firm
987654321
Transfer
Fund/SERV
Control
Control
Number
Number
Submitting
9999
Number
Receiving Firm
Firm
Customer
Number
Account Number
Contra Firm
Number
8819
Contra Firm
Type
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 106
1029384756
NSCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the four separate tax lots related to the Asset Record
FIELD NAME
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
LOT 1
LOT 2
LOT 3
LOT 4
Transaction Type
51
51
51
51
Transfer Control
Fund/SERV
Fund/SERV
Fund/SERV
Fund/SERV
Number
Control
Control
Control
Control
Number
Number
Number
Number
Alternate Control
ACATS Control
ACATS Control
ACATS Control
ACATS Control
Number
Number
Number
Number
Number
Contra Firm
8819
8819
8819
8819
Contra Firm Type
NSCPRT
NSCPRT
NSCPRT
NSCPRT
Submitting Firm
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
1029384756
1029384756
1029384756
1029384756
987654321
987654321
987654321
987654321
Number
Number
Submitting Firm
Type
Receiving Firm
Customer
Account Number
Submitting Firm
Customer
Account Number
TRANSFERS OF MUTUAL FUND SECURITIES > 107
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.2 d.
Networking Fund to Firm Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and four Tax Lot Records if the transfer was
facilitated through Networking as a B52 transfer (shares moving from a fund controlled account
to a firm controlled account).
While Networking does not prohibit firms from ‘pulling’ gifted shares through a firm-to-fund
transfer, the Task Force recommends that gift transactions should only be initiated by the
delivering entity. This ensures that the gifted request is reviewed and processed in accordance
with the fund’s policies and procedures for gifted shares, and in good order, prior to the gifted
share transfer.

Industry Required Practice: Networking transfers should not be used to ‘pull’ shares for a
transfer due to gift. Instead, the shareholder should contact the fund directly to execute the
transfer.
Asset Record
FIELD NAME
Transaction
VALUE
FIELD NAME
56
Transfer Control
Type
Number
VALUE
Networking
Control
FIELD NAME
VALUE
Alternate
Blank
Control Number
Number
Submitting
NSCPRT
Firm Type
Submitting
Firm Number
8819
Submitting Firm
1029384756
Receiving Firm
Customer Account
Customer
Number
Account Number
Contra Firm
Number
9999
Contra Firm
Type
TRANSFERS OF MUTUAL FUND SECURITIES > 108
987654321
DTCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the four separate tax lots related to the Asset Record
FIELD NAME
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
LOT 1
LOT 2
LOT 3
LOT 4
Transaction Type
56
56
56
56
Transfer Control
Networking
Networking
Networking
Networking
Number
Control
Control
Control
Control
Number
Number
Number
Number
Blank
Blank
Blank
Blank
9999
9999
9999
9999
Contra Firm Type
DTCPRT
DTCPRT
DTCPRT
DTCPRT
Submitting Firm
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
987654321
987654321
987654321
987654321
1029384756
1029384756
1029384756
1029384756
Alternate Control
Number
Contra Firm
Number
Number
Submitting Firm
Type
Receiving Firm
Customer
Account Number
Submitting Firm
Customer
Account Number
5.5.2 e.
Manual Transfer Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and four Tax Lot Records in the case of the
transfer being processed manually.

Note: In most cases the manual process is the result of a failed or rejected transfer originally
passed through NSCC and is being handled manually as a service. The Industry recommended
practice is to utilize the original control numbers from those transactions when processing these
transactions manually so that the receiver can reconcile the CBRS records with the Networking
F55 Activity.
TRANSFERS OF MUTUAL FUND SECURITIES > 109
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
TRANSFERS OF MUTUAL FUND SECURITIES > 110
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Asset Record
FIELD NAME
Transaction
VALUE
57
Type
FIELD NAME
VALUE
FIELD NAME
VALUE
Transfer Control
Fund/SERV,
Alternate
ACATS
Number
Networking,
Control Number
Control
or Fund
Number
Originated
Control
Number
Submitting
NSCPRT
Firm Type
Submitting
Firm Number
8819
Submitting Firm
1029384756
Receiving Firm
Customer
Customer
Account Number
Account Number
Contra Firm
Number
9999
Contra Firm
Type
TRANSFERS OF MUTUAL FUND SECURITIES > 111
987654321
DTCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the four separate tax lots related to the Asset Record
FIELD NAME
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
LOT 1
LOT 2
LOT 3
LOT 4
57
57
57
57
Transfer
Fund/SERV,
Fund/SERV,
Fund/SERV,
Fund/SERV,
Control
Networking, or
Networking, or
Networking, or
Networking, or
Number
Fund Originated
Fund Originated
Fund Originated
Fund Originated
Control Number
Control Number
Control Number
Control Number
Blank
Blank
Blank
Blank
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
987654321
987654321
987654321
987654321
1029384756
1029384756
1029384756
1029384756
Transaction
Type
Alternate
Control
Number
Contra Firm
Number
Contra Firm
Type
Submitting
Firm Number
Submitting
Firm Type
Receiving
Firm
Customer
Account
Number
Submitting
Firm
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 112
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.3 Inherited Shares for FIFO Account
Example C - Inherited Shares Using FIFO: On February 15, 2013, a shareholder inherits all
shares from a direct at fund account at Fund Company 8819 (account number 1029384756) that
are transferred into their beneficiary account (987654321) at firm 9999. The donor’s date of
death is February 2, 2013 and the shares are priced on the date of death at $5.32. Shares are
not in physical form. The security issue is identical on both sides. Both accounts use CBRS. The
shareholder’s cost basis (lot disposition) method is FIFO.

Note: For the PTF Push scenario below, this transfer will move in the opposite direction - from a
firm controlled account to a fund controlled account held within the same fund company .
The detailed tax lots currently held by the shareholder at Fund Company 8819 that will be used
in the subsequent scenarios are:
Lot
Transaction
Acquisition
Tax Lot
Price Per
Purchase
Share
No.
Type
Date
Shares
Share (NAV)
Cost
Balance
1
Purchase
6/1/2011
200.000
$5.27
$1,054.00
200.000
Non-Covered
2
Purchase
12/1/2011
100.000
$5.24
$524.00
300.000
Non-Covered
3
Purchase
12/1/2012
100.000
$5.26
$526.00
400.000
Covered
4
Dividend
12/31/2012
50.000
$5.08
$254.00
450.000
Covered
5
Purchase
2/1/2013
200.000
$5.11
$1,022.00
650.000
Covered
TRANSFERS OF MUTUAL FUND SECURITIES > 113
Share Type
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
The following tax lots are used to support the February 2, 2013 full transfer out of 650 shares:
Lot No.
Acquisition
Tax Lot
Price
Tax Lot Current
Non-Covered/
Fair Market
Date
Quantity
per
Cost
Pending
Value as of
Share
Date of
Death:
2/15/2013
(NAV $5.32)
1
6/1/2011
200.000
$5.27
$1,054.00
01
$1,064.00
2
12/1/2011
100.000
$5.24
$524.00
01
$532.00
3
12/1/2012
100.000
$5.26
$526.00
$532.00
4
12/31/2012
50.000
$5.08
$254.00
$266.00
5
2/1/2013
200,000
$5.11
$1,022.00
$1,064.00
As a result of the successful transfer transaction, which moved shares to the recipient’s account,
Fund Company 8819 prepares a CBRS transfer statement and systematically transmits the cost
basis to the recipient’s account via CBRS. It should be noted that the cost basis presented
above will be “stepped up” to reflect the Fair Market Value (FMV) of the shares on the date of
death. Therefore the acquisition date of the tax lots transferred will be the donor’s date of death.
5.5.3 a.
Common Fields Populated on the CBRS Record Layouts
The following details the common fields that need to be populated on the Asset Record and
five Tax Lot Records required to be sent for this transfer example regardless of the method of
transfer (ACATS Fund/SERV PTF, Networking, or Manual).

Note: In an inherited scenario, the acquisition date of the shares transferred is reflected as the
original shareholder’s date of death. The tax lots are valued using the stepped up basis, which is
the FMV of the shares on February 2, 2013 (date of death) of $5.32.
TRANSFERS OF MUTUAL FUND SECURITIES > 114
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Asset Record
FIELD NAME
Record Content
VALUE
FIELD NAME
01
Total Position
Indicator
Position Code
VALUE
FIELD NAME
650,0000
Asset Category
20130202
ISIN Country
VALUE
MFNM
Quantity
L
Settlement Date of
Transfer
Asset
Name of
ISIN Security Issue
Description
Fund
ID (CUSIP)
US
Code
Fund
CUSIP
TRANSFERS OF MUTUAL FUND SECURITIES > 115
Disposition
Method Used
01
(FIFO)
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the five separate tax lots that fall under the Asset Record
FIELD NAME
VALUE –
VALUE –
VALUE –
VALUE –
VALUE –
TAX LOT 1
TAX LOT 2
TAX LOT 3
TAX LOT 4
TAX LOT 5
01
01
01
01
01
ISIN Country Code
US
US
US
US
US
ISIN Security Issue
Fund
Fund
Fund
Fund
Fund
ID (CUSIP)
CUSIP
CUSIP
CUSIP
CUSIP
CUSIP
Asset Description
Name of
Name of
Name of
Name of
Name of
Fund
Fund
Fund
Fund
Fund
01
01
02
02
02
02
02
Date of Gift
Blank
Blank
Blank
Blank
Blank
Fair Market Value
Blank
Blank
Blank
Blank
Blank
Tax Lot Quantity
200,0000
100,0000
100,0000
50,0000
200,0000
Position Code
L
L
L
L
L
Acquisition Date of
20130202
20130202
20130202
20130202
20130202
1064,00
532,00
532,00
266,00
1064,00
Blank
Blank
Blank
Blank
Blank
Record Content
Indicator
NonCovered/Pending
Indicator
Gifted or Inherited
Indicator
as of Date of Gift
Tax Lot
Tax Lot Current
Cost
Zero Basis Indicator
TRANSFERS OF MUTUAL FUND SECURITIES > 116
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.3 b.
ACATS Fund/SERV PTF Pull Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and five Tax Lot Records if the transfer was
facilitated through ACATS Fund/SERV as a PTF Pull (shares moving from a fund controlled
account to a firm controlled account).
Asset Record
FIELD NAME
Transaction
VALUE
46
Type
FIELD NAME
Transfer Control
Number
VALUE
Fund/SERV
Control
FIELD NAME
VALUE
Alternate
ACATS
Control Number
Control
Number
Submitting
NSCPRT
Firm Type
Submitting
Firm Number
8819
Submitting Firm
1029384756
Number
Receiving Firm
Customer
Customer
Account Number
Account Number
Contra Firm
Number
9999
Contra Firm
Type
TRANSFERS OF MUTUAL FUND SECURITIES > 117
987654321
DTCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the five separate tax lots related to the Asset Record
FIELD
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
NAME
LOT 1
LOT 2
LOT 3
LOT 4
LOT 5
Transaction
46
46
46
46
46
Transfer
Fund/SERV
Fund/SERV
Fund/SERV
Fund/SERV
Fund/SERV
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Alternate
ACATS
ACATS
ACATS
ACATS
ACATS
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Contra Firm
9999
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
DTCPRT
8819
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
NSCPRT
987654321
987654321
987654321
987654321
987654321
1029384756
1029384756
1029384756
1029384756
1029384756
Type
Number
Contra Firm
Type
Submitting
Firm
Number
Submitting
Firm Type
Receiving
Firm
Customer
Account
Number
Submitting
Firm
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 118
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.3 c.
ACATS Fund/SERV PTF Push Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and five Tax Lot Records if the transfer was
facilitated through ACATS Fund/SERV as a PTF Push (shares moving from a firm controlled
account to a fund controlled account).
Asset Record
FIELD NAME
VALUE
FIELD
VALUE
FIELD NAME
VALUE
Alternate
ACATS
Control Number
Control
NAME
Transaction
51
Type
Submitting
DTCPRT
Firm Type
Submitting
Firm
987654321
Transfer
Fund/SERV
Control
Control
Number
Number
Submitting
9999
Number
Receiving Firm
Firm
Customer
Number
Account Number
Contra Firm
Number
8819
Contra Firm
Type
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 119
1029384756
NSCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Covers the five separate tax lots that fall under the Asset Record
FIELD
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
NAME
LOT 1
LOT 2
LOT 3
LOT 4
LOT 5
Transaction
51
51
51
51
51
Transfer
Fund/SERV
Fund/SERV
Fund/SERV
Fund/SERV
Fund/SERV
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Alternate
ACATS
ACATS
ACATS
ACATS
ACATS
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Contra Firm
8819
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
NSCPRT
9999
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
DTCPRT
1029384756
1029384756
1029384756
1029384756
1029384756
987654321
987654321
987654321
987654321
987654321
Type
Number
Contra Firm
Type
Submitting
Firm
Number
Submitting
Firm Type
Receiving
Firm
Customer
Account
Number
Submitting
Firm
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 120
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.3 d.
Networking Fund to Firm Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and five Tax Lot Records if the transfer was
facilitated through Networking as a B52 transfer (shares moving from a fund controlled account
to a firm controlled account)
Asset Record
FIELD NAME
Transaction
VALUE
FIELD NAME
46
Transfer Control
Type
Number
VALUE
Networking
Control
FIELD NAME
VALUE
Alternate
Blank
Control Number
Number
Submitting
NSCPRT
Firm Type
Submitting
Firm Number
8819
Submitting Firm
1029384756
Receiving Firm
Customer Account
Customer
Number
Account Number
Contra Firm
Number
9999
Contra Firm
Type
TRANSFERS OF MUTUAL FUND SECURITIES > 121
987654321
DTCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the five separate tax lots that fall under the Asset Record
FIELD
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
VALUE – TAX
NAME
LOT 1
LOT 2
LOT 3
LOT 4
LOT 5
Transaction
56
56
56
56
56
Transfer
Networking
Networking
Networking
Networking
Networking
Control
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Number
Alternate
Blank
Blank
Blank
Blank
Blank
9999
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
DTCPRT
8819
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
NSCPRT
987654321
987654321
987654321
987654321
987654321
1029384756
1029384756
1029384756
1029384756
1029384756
Type
Control
Number
Contra Firm
Number
Contra Firm
Type
Submitting
Firm
Number
Submitting
Firm Type
Receiving
Firm
Customer
Account
Number
Submitting
Firm
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 122
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.3 e.
Manual Transfer Specific Fields
In addition to the common fields noted above, the following details the specific fields that
would need to be populated on the Asset Record and five Tax Lot Records in the case of the
transfer being processed manually.

Note: In most cases the manual process is the result of a failed or rejected transfer originally
passed through NSCC and is being handled manually as a service. The Industry recommended
practice is to utilize the original control numbers from those transactions when processing these
transactions manually so that the receiver can reconcile the CBRS records with the Networking
F55 Activity.
Asset Record
FIELD NAME
Transaction
VALUE
FIELD NAME
57
Type
VALUE
FIELD NAME
Transfer Control
Fund/SERV,
Alternate
Number
Networking,
Control Number
VALUE
Blank
or Fund
Originated
Control
Number
Submitting
NSCPRT
Firm Type
Submitting
Firm Number
8819
Submitting Firm
1029384756
Receiving Firm
Customer Account
Customer
Number
Account Number
Contra Firm
Number
9999
Contra Firm
Type
TRANSFERS OF MUTUAL FUND SECURITIES > 123
987654321
DTCPRT
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Tax Lot Record: Includes the five separate tax lots related to the Asset Record
FIELD NAME
VALUE –
VALUE –
VALUE –
VALUE –
VALUE –
TAX LOT 1
TAX LOT 2
TAX LOT 3
TAX LOT 4
TAX LOT 5
57
57
57
57
57
Transfer
Fund/SERV,
Fund/SERV,
Fund/SERV,
Fund/SERV,
Fund/SERV,
Control
Networking,
Networking,
Networking,
Networking,
Networking,
Number
or Fund
or Fund
or Fund
or Fund
or Fund
Originated
Originated
Originated
Originated
Originated
Control
Control
Control
Control
Control
Number
Number
Number
Number
Number
Blank
Blank
Blank
Blank
Blank
9999
9999
9999
9999
9999
DTCPRT
DTCPRT
DTCPRT
DTCPRT
DTCPRT
8819
8819
8819
8819
8819
NSCPRT
NSCPRT
NSCPRT
NSCPRT
NSCPRT
987654321
987654321
987654321
987654321
987654321
1029384756
1029384756
1029384756
1029384756
1029384756
Transaction
Type
Alternate
Control
Number
Contra Firm
Number
Contra Firm
Type
Submitting
Firm Number
Submitting
Firm Type
Receiving
Firm
Customer
Account
Number
Submitting
Firm
Customer
Account
Number
TRANSFERS OF MUTUAL FUND SECURITIES > 124
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
5.5.4 Exception/Correction Processing
Industry Recommended Practice: Industry recommended practice when correcting a transfer

transaction is to cancel the original transfer transaction and deliver a (to and from) transfer
cancelation using the Networking F55 Activity record utilizing the appropriate Transfer Cancelation
transaction types.
The original transaction is then voided by both parties, any impact from previously-exchanged
CBRS records are deleted from both the delivering and receiving entities cost basis systems, and a
subsequent new transfer transaction and related CBRS records are transmitted.
This recommended practice applies to cancellations/corrections that affect all or a portion of the
original transfer and related cost basis records.
This recommended practice applies to cancelations or adjustments of all transfer types – ACATS
Fund/SERV PTF Pull and PTF Push, Networking and De-Networking, and manual transfers.
Please refer to section 5.1.2 DTCC Enhancements for Cost Basis Reporting in this guide for
further details on exception/correction processing.
The two new transaction types that may be utilized to represent this activity on the F55 are:
•
33 = Transfer From – Cancellation
•
34 = Transfer To – Cancellation
TRANSFERS OF MUTUAL FUND SECURITIES > 125
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Example D - Exception/Correction Processing: The detailed tax lots currently held by the shareholder at Fund Company or Firm are as
follows:
Lot
Transaction
Acquisition
NSCC Control
Tax Lot
Price
Purchase
Share
No.
Type
Date
Number
Shares
Per
Cost
Balance
Share
Current
(NAV)
Cost Basis
Share Type
Account
Average
Cumulative
Cost per
Cost Basis
Share
1
Purchase
6/1/2011
200.000
$5.27
$1,054.00
200.000
Non- Covered
$1,054.00
$5.27
2
Purchase
12/1/2011
100.000
$5.24
$524.00
300.000
Non- Covered
$1578.00
$5.26
BEGINNING IN 2012, A SEPARATE AVERAGE COST PER SHARE IS CALCULATED FOR THE COVERED SHARES
3
Purchase
12/1/2012
100.000
$5.26
$526.00
400.000
Covered
$526.00
$5.26
4
Dividend
12/31/2012
50.000
$5.08
$254.00
450.000
Covered
$780.00
$5.20
5
Purchase
2/1/2013
200.000
$5.11
$1,022.00
650.000
Covered
$1,802.50
$5.15
7
Transfer
2/3/2013
CATSA1234567890
ALL
5/5/2013
123456789123456
ALL
Out to Firm
9999
8
Transfer
Cancel
On 5/5/2013, the fund received instructions that the full transfer processed on 2/3/2013 was for an incorrect amount.
The fund manually processes a transfer cancellation on their system canceling both sides of the original transfer. As a result, the system
generates an F55 Networking Activity record, reflecting the cancel, to the firm. The F55 transaction type ‘34’ represents the “to” side since the
original transfer went “from” the fund “to” the firm. The recommended practice is to include the Original Control Number Indicator of
1=Fund/SERV Control Number and Original Control Number CATSA1234567890 of the transfer on the F55 record.
No cost basis is passed as a result of the cancel. Upon receipt of the F55 Networking Activity record, the firm will remove the Cost Basis tax
lots associated with the original transfer. It is expected that a new transfer will be submitted where new basis records will follow
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6
Frequently Asked Questions: Transfer Reporting
1.
How do fund companies support firm-initiated redemptions and related tax
reporting on fund-controlled matrix Levels 0 and 4 accounts?
It is recommended that the Fund, which acts as the primary record keeper for cost basis reporting
purposes on fund-controlled matrix Levels 0 and 4 accounts, be responsible for all 1099-B reporting on
broker-initiated redemption activity. This is a change in recommended practice from that largely followed
within the industry, whereby the party executing the redemption on these accounts also assumed the
corresponding tax reporting for that specific redemption.
The primary reason for this change in practice is due to the impracticalities of retaining the former
recommended practice. Because the cost basis reporting must accompany gross proceeds reporting,
retaining the former recommended practice would require coordinated and/or dual tax lot tracking by
firms and funds. Extensive and costly enhancements would be required for Fund/SERV identification of
specific lot transactions, which given the low volumes of these types of transactions, is not warranted or
supported by industry participants.
As a result of this change, some fund companies, and many broker/dealers, will no longer allow these
transactions as of January 1, 2012. However, broker/dealers may still initiate redemption activity against
a fund-controlled account. Cost Basis lot depletion will be driven by the shareholder’s elected calculation
method on the fund account, or in the absence of an affirmative election, the fund’s default cost basis
calculation method. Funds will report the gross proceeds and corresponding cost basis information for
such transactions.
The white paper entitled, “Firm-Initiated Fund/SERV Redemptions on Fund-Controlled Accounts” is
provided in Appendix B of this document. The white paper provides detailed information on the basis for
this recommended practice and identifies areas where reporting brokers should review and remediate
operational and legal arrangements that may be impacted by implementing the new recommended
practice. Broker/Dealers and fund companies are encouraged to confirm each other’s preferred policies,
prior to January 1, 2012.
2.
How do I know if an entity is participating in CBRS?
DTCC CBRS participants are identified on the daily Cost Basis User Master File. The Cost Basis User
Master File can be received electronically on a daily basis. For further details, please refer to the Master
File record layouts available at http://www.dtcc.com/products/documentation/cs/cbrs.php. Please note
that participants may appear under their brokerage name or under their clearing firm’s name.
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3.
How should firms and mutual funds adjust for an unfulfilled Letter of Intent (LOI)
or CDSC Fee Reversal when an account is to be transferred?
The recommended practice is to cancel and rebook the original trade(s) at the adjusted price per share
before an account is transferred. Such action is needed to make sure basis at the tax lot level is calculated
properly, which is critical for accurate basis reporting. Reporting brokers should be aware this course of
action could trigger corrected 1099-B reporting, if applicable.
4.
When transferring an account in which a redemption or sale has occurred and the
average cost basis method was used, does the delivering broker need to
communicate this fact to the receiving broker?
Reporting that the average cost basis method was used is not necessary. However, if a sale has occurred,
the transfer statement should list each lot separately with their associated acquisition dates, and the
adjusted cost basis for each lot should reflect the average cost of the position. Tax lots under the average
cost method that are held for more than five years may be rolled up into a single tax lot with an
acquisition date of “VARIOUS”. This is noted in the CBRS layouts through use of the Acquisition Date of
‘19010101.’
5.
When transferring an account to a new position at another broker with an
identical or like account registration in which the average cost method has been
used and a redemption or sale has NOT occurred, what lot data should be sent to
the delivering broker?
If the shareholder has affirmatively elected average cost and is still within the revocation period, or has
chosen a method other than the broker’s default of average cost and is still within the “change in method”
period 26, there are differing views in the industry as to whether a transfer of like or identical registration
25F
between reporting brokers constitutes a “disposition of shares” as defined in the IRS regulations. Many
believe that this scenario is not a disposition of shares and thus the change in reporting broker does not
end the revocation or “change in method” period. Therefore, the transfer statement may include the
adjusted cost basis for each individual share lot. Passing individual lot data versus average cost provides
the greatest degree of flexibility to the shareholder in declaring a basis method for future redemptions in
the new account.
Others view these types of transfers as a “disposition of shares,” which would require the delivering broker
to value all covered shares at the average cost on the date of disposition upon transfer to the new
reporting broker. Because of these differing views, reporting brokers should consult with their legal and
compliance advisors to determine what should be reported for these types of transfers.
26
Pursuant to Notice 2011-56, the IRS now permits shareholders to choose a method other than the broker’s default of
average cost for existing shares in an account, until the earlier of (1) one year from the broker’s notification that
average cost is its default method, or (2) the first sale, transfer or other disposition of shares (the “change in method”
period).
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Special considerations for average cost and the impact on transfers are discussed more fully in Section 3
of the guide.
6.
How does a Return of Capital or other corporate action event affect transfer
statements previously sent?
Delivering reporting brokers are required to provide receiving reporting brokers with corrected transfer
statements for covered securities accounting for any corporate action events that are announced after the
transfer but are effective as of a date the shares were on the delivering reporting broker’s books. If such
shares have been transferred after the corporate action, but before the account’s shares were adjusted, a
corrected transfer reporting statement with adjusted cost basis information must be sent to the receiving
reporting broker. Please refer to Question 9 below for additional details on corrected transfer reporting
requirements.
7.
What is the recommended practice for recording corrected tax lots on shares
previously transferred through CBRS that have been impacted by a Return of
Capital?
Once the delivering reporting broker has completed the correction described in Question 6, corrected
CBRS lots must be sent. Since the CBRS Asset Record must equal the CBRS Tax Lot Record, all of the lots
will be resent on the corrected transfer records. Each lot bears a designation whether it is comprised of
original or corrected data. Affected lots should be updated for the Return of Capital adjustment where
applicable. The CBRS record does not note the specific reason why the tax lot has been corrected because
it is not required to be noted on a transfer reporting statement. Please refer to Question 9 below for
additional details on corrected transfer reporting requirements.
8.
If a co- owner of a joint account dies, is the account considered inherited? Does
an adjustment need to occur to step up the basis for the joint ownership portion
of the account, or is the joint owner removed from the account as a right of
survivorship?
The answer to this question will depend on state law and the type of joint account, both subject to the
legal interpretation of the reporting broker. The regulations do state that if the transferor cannot identify
which securities in a joint account have been transferred from the decedent, then the transferor must
treat each security in the account as if it were non-covered.
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9.
What happens if a reporting broker doesn’t send a transfer reporting statement
with cost basis information for a taxable account?
On taxable accounts, a transferor must furnish a transfer statement within fifteen (15) days after the date
of settlement of the transfer of the covered shares. If a transfer statement is not received within 15 days,
the receiving reporting broker must notify the transferor that it did not receive a transfer statement and
request that such a statement be sent. If no transfer statement is provided after this request, the
regulations permit the receiving reporting broker to treat the shares as “non-covered” on their records and
for 1099-B reporting purposes.
The regulations provide that brokers and transferors must correct their Form 1099-B and/or transfer
statements to account for late or corrected transfer statements or issuer reports. Thus, if the delivering
reporting broker later provides the basis information within eighteen (18) months of the settlement date,
the receiving reporting broker must accept it and adjust the basis of the shares accordingly. If the
receiving broker no longer holds the shares, due to subsequent transfer to another reporting broker, such
updated basis information will require the receiving broker – in their role as delivering broker in the
subsequent transfer – to send a corrected transfer statement to the receiving broker for the subsequent
transfer. If the shares have already been disposed of, the receiving reporting broker(s) must send a
corrected Form 1099-B, subject to the three (3) year limitation on Form 1099-B corrections.
10. If a transfer reporting statement is not received from the delivering reporting
broker, who can the receiving reporting broker contact through CBRS regarding
the missing transfer reporting statement?
Delivering reporting brokers have up to 15 calendar days to deliver their transfer statement to the
receiving reporting broker. If the delivering reporting broker that fails to send the transfer statement is
enrolled in CBRS, the receiving reporting broker will be able to locate them on the Cost Basis User Master
File (a daily file including details on all firms enrolled in the service). CBRS has the ability for a receiving
reporting broker to request a transfer statement of the delivering reporting broker, referencing the specific
transaction.
If one firm uses CBRS, and the other does not, then a follow-up request for a transfer reporting statement
must be handled manually (outside of CBRS).
11. How will a firm convey that transferred shares were gifted or inherited shares on
CBRS transfer reporting record layouts?
For firms using CBRS, there is an “indicator” field that can be populated to show whether a tax lot is
gifted, inherited, or inherited, then gifted.
For firms not using CBRS, the presentment of the information
will differ depending on the format of the manual transfer statement.
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12. When an original acquisition date is not available on a lot being transferred, what
date should be provided for the lot?
Covered tax lots, in the context of mutual funds, will always have an acquisition date and cost basis, so
this situation will only occur for non-covered tax lots. If a transfer statement with covered tax lots does
not include acquisition dates on those tax lot(s), the transfer statement will be rejected by CBRS as an
“incomplete” transfer statement.
CBRS does support the delivery of transfer statements including non-covered shares with a ‘blank’
acquisition date. The recommended practice is not to reject transfer statements where original acquisition
dates are ‘blank’ or not provided on non-covered tax lots. Such lots will typically have a zero (“0”) or
unknown cost basis. Because the IRS requires that, absent shareholder instructions, all non-covered
shares with unknown acquisition dates should be removed from an account first, it is important to clearly
distinguish between truly unknown acquisition dates on non-covered shares versus non-covered shares
with known acquisition dates.

Industry Recommended Practice: Delivering reporting brokers should send all “known” basis
information, even on non-covered shares, to the receiving reporting broker.
In many instances, brokers are providing all known basis information to their shareholders, even on noncovered shares, as a customer service. While basis information on non-covered shares is not required to
be provided by the reporting broker to the IRS, the shareholder may be using basis information voluntarily
provided by the reporting broker to accurately compute their gain or loss on Schedule D of their tax
return. In all cases, reporting brokers should ensure they are only providing basis information on noncovered shares for which they have no reason to believe the basis is incorrect.
It is recommended that if the delivering reporting broker has voluntarily reported non-covered “known”
basis information to the shareholder under Average Cost, when shares are transferred the Average Cost
basis should also be reported to the receiving broker. This practice will allow known basis on non-covered
shares to continue to be consistently reported voluntarily to the shareholder using the average cost
method.
13. What is the recommended practice for transferring gifted mutual fund shares?
Gifted share transfer statements require that the cost basis information transferred include both the fair
market value on the date of the gift, and the carryover basis on the applicable tax lots. The CBRS record
layouts allow participants to transfer the required information in these situations.
There are special considerations for transferring gifted shares. For instance, average cost cannot be used
if the shares are gifted at a loss. For gifted shares in this situation to be valued at average cost by the
receiving reporting broker, an authorized individual associated with the account receiving the gifted shares
must indicate, prior to or at transfer, that they will accept the fair market value—and not the donee’s
carryover basis—for the shares in question.
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The final IRS regulations governing transfer statements require that all transfers should be reported as
gifts, if the reason for the transfer is not clear.
Operationally, the Task Force has recommended that transfers due to gifts are never ‘pulled’ from the
delivering to the receiving firm. Instead, the shareholder is directed to the delivering firm to request the
transfer due to gift. While ACATS PTF “Pull” does not permit this capability (the NSCC will reject the
transaction), Networking does not prohibit a receiving firm from pulling gifted shares.
14. Who is responsible for tracking and reporting cost basis information on NSCC
Matrix Level 3 and Trust Networked Level 0 accounts?
Firms (broker/dealers) are responsible for tax reporting on Matrix Level 3 accounts and Bank Trusts are
responsible for tax reporting on Trust Networked Level 0 accounts, per NSCC’s rules governing the NSCC
Networking account matrix levels. The Firm or Trust is also responsible for tracking and administering
cost basis reporting on behalf of their customers.
15. Are reporting brokers permitted to accept shareowner provided basis information
on covered shares, including shares transferred to a new firm?
Reporting brokers are permitted, but not required, to take into account customer requests for changes to
cost basis on covered securities unless they know or have reason to know that the customer-provided
information is incorrect. Firms should evaluate shareholder requests to change cost basis information on
covered shares on a case-by-case basis, including the origin of the customer-provided data.
In addition, delivering reporting brokers may also transfer customer-provided basis information for
covered shares on CBRS tax lots (which will be flagged as such). The cost basis regulations require that
unless the broker knows or has reason to know that the information reported by the delivering reporting
broker is incorrect or incomplete, it must accept the basis information that is supplied on the transfer
statement.
16. What procedures and system controls does the Fund have in place for Networking
level account changes, or Networking dealer changes on broker-controlled
accounts?
Both of these types of changes affect who is responsible for cost basis tracking/reporting. The
recommended practice for accounts changing networking levels (which move to/from direct-at-fund
administration or broker-to-broker) is to create a Networking B50 new account with the appropriate
matrix level and to execute a Networking B52 transfer. Cost basis information can be submitted through
CBRS as a result of the transaction.
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Recommended industry practice is for funds to not accept Networking B51 maintenance records that
attempt to change networking matrix level / tax reporting responsibility between fund and firm control, in
lieu of a Networking B50 new account / Networking B52 transfer process. Funds and their service
providers are modifying systems to implement this practice, either through rejection of the Networking
B51 maintenance to matrix level change, or by converting the Networking B51 matrix level change
request into a Networking-like new account and transfer transaction.
Change of dealer functions through Networking will require the contra-parties to the transfer of the
broker-controlled positions (Matrix Level 3 and Trust-Networked Level 0) to transfer the cost basis
information for affected shareholders as a result of such transactions. This cost basis transfer reporting
can be facilitated through CBRS. Changes of dealers that remain fund-controlled positions (Matrix Level 4
and non-networked Level 0 accounts) have no cost basis transfer reporting impact.
No systematic enhancements will be developed by DTCC to monitor transfer reporting of these types of
transactions.
17. Should cost basis be requested and/or passed on a transfer of fund shares that
occurs prior to the compliance date for mutual funds of January 1, 2012?
Since the regulations require transfer reporting for mutual fund shares acquired beginning January 1,
2012, many mutual funds, brokers and banks will not be prepared to provide or accept transfer reporting
of cost basis information for fund shareholders until later in 2011 for testing purposes. Reporting brokers
are developing or modifying their systems to comply with the new requirements for mutual fund securities
in 2011. Please refer to the DTCC CBRS User Master File to determine if a DTCC participant is eligible to
use CBRS for transfer reporting.
With regard to cost basis requests, data is not required to be passed until the effective date of January 1,
2012. However, when a participant indicates on the DTCC CBRS User Master File that it is eligible to use
CBRS (even if for testing purposes only), it is the receiving broker’s discretion to request basis information
for any transfers that occur prior to the effective date for mutual funds. Note that the Annotated CBRS
record layouts offer an industry recommended practice to not submit a CBRS Record Content Indicator
of 04 = Request prior to the mutual fund compliance date of January 1, 2012.
18. How does a firm or fund receive cost basis data for a manual transfer?
Utilization of CBRS is an industry recommended practice, which will ensure the seamless and timely
transfer of cost basis information to receiving reporting brokers. CBRS has provisions for identifiers
related to manual transfers (such as a mutual fund transfer that happens outside of ACATS-Fund/SERV or
Networking), to facilitate an automated exchange of cost basis information for these transaction types.
Please refer to DTCC’s CBRS User Guide and the Manual Transfers discussion in the Transfers section of
this Supplemental User Guide for additional details.
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Reporting brokers must be prepared to accept completed manual transfer statements provided by a
transferor. But, there are many challenges with manual statements, including whether the delivering
reporting broker can correctly identify who to send the transfer statement to at a receiving reporting
broker, and whether the receiving reporting broker has procedures to redirect transfer statements that
have been sent to incorrect locations. Manual delivery of the applicable information will be costly to input
into basis reporting systems, and in many cases, will significantly delay the availability of cost basis
information for receiving reporting brokers.
However, through its “WebDirect” service, DTCC offers a product whereby manual transfer reporting of
cost basis information may also be processed through CBRS. The cost basis transfer statement
information can be manually input or uploaded into CBRS through a standardized layout and
systematically transferred to receiving reporting brokers, or received from a delivering reporting broker in
a download to Microsoft Excel™ format. WebDirect input and output has no impact on how CBRS routes
and reports information to contra-parties; the contra-party can either use a transmission-based
(automated computer-to-computer) connection, or WebDirect.
Please visit http://www.dtcc.com/products/cs/equities_clearance/cbrs.php for more details on the
WebDirect service for automating manual transfers of cost basis information.
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Appendix A: Resource Reference Materials
Section 1012 – Basis of Property – Cost
Section 6045 – Returns of Brokers
Section 6045A – Information Required in Connection with Transfers of Covered Securities to Brokers
Section 6045B – Returns Relating to Actions Affecting Basis of Specified Securities
IRS’s Cost Basis Reporting Overview and FAQs
IRS Notice 2011-56 – Guidance on Average Cost Default Method & Other Cost Basis Reporting Issues
(with a hyperlink to http://www.irs.gov/pub/irs-drop/n-11-56.pdf)
Form 1099-B
Form 1099-B Instructions
Form W-9
Form W-9 Instructions
The ICI BDAC CBR Task Force has developed a white paper that contains recommended practices for firminitiated Fund/SERV redemptions on fund-controlled accounts. See Appendix B for BEST PRACTICES:
Firm-Initiated Fund/SERV Redemptions on Fund-Controlled Accounts.
Detailed information on CBRS may be found on DTCC’s website at:
http://www.dtcc.com/products/cs/equities_clearance/cbrs.php
The website contains links to DTCC’s CBRS User Guide, record layouts, New Account Forms and
Instructions, Important Notices, and Frequently Asked Questions (FAQs) on CBRS including information
about new account set up, data input and output, and testing.
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Appendix B: White Paper – Recommended Practices for FirmInitiated Fund/SERV Redemptions on Fund-Controlled
Accounts
This section contains a facsimile of the white paper produced by the Investment Company Institute (ICI),
authored by the ICI Broker/Dealer Advisory Committee Cost Basis Reporting task force and published on
June 30, 2010.
Disclaimer
This Best Practices Guide (this “Guide”) was produced by the Investment Company Institute, through a Task Force of
its Broker/Dealer Advisory Committee, and is reproduced here with the permission of the Depository Trust & Clearing
Corporation (“DTCC”).
This Guide is not a legal document and the statements contained herein do not set forth any legal obligations of DTCC,
National Securities Clearing Corporation (“NSCC”) or any other DTCC subsidiary, nor do any statements contained
herein set forth any legal rights of any NSCC user. All such legal rights and obligations are set forth in NSCC’s Rules &
Procedures and each user’s Membership Agreement with NSCC (together, the “Legal Documents”). The user is referred
to the Legal Documents for a statement of all such legal obligations. In general, unless the context clearly indicates
otherwise, terms used in this Guide have the same meanings as in the Legal Documents.
NEITHER DTCC NOR ANY OF ITS SUBSIDIARIES WARRANTS THE ACCURACY OR COMPLETENESS OF THE INFORMATION
CONTAINED IN THIS GUIDE. FURTHER, NEITHER DTCC NOR ANY OF ITS SUBSIDIARIES WARRANTS THE ACCURACY
OR COMPLETENESS OF ANY OTHER WEB SITE WHICH THE USER MAY ACCESS THROUGH THIS GUIDE. THE
INFORMATION CONTAINED IN THIS GUIDE IS NOT INTENDED TO BE A SUBSTITUTE FOR OBTAINING LEGAL OR TAX
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BE LIABLE FOR LOSSES OR DAMAGES, INCLUDING LOSS OF PROFITS OR CONSEQUENTIAL DAMAGES, ARISING OUT
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INTERNAL REVENUE CODE; AND (B) AS A MATTER OF POLICY, DTCC DOES NOT PROVIDE TAX, LEGAL OR
ACCOUNTING ADVICE AND ACCORDINGLY, YOU SHOULD CONSULT YOUR OWN TAX, LEGAL AND ACCOUNTING
ADVISOR BEFORE ENGAGING IN ANY TRANSACTION.
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All rights reserved.
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The following two pages contain a facsimile of the original memorandum from ICI, dated October 1, 1992.
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Appendix C: Glossary
Term
Definition
Average Cost
A calculation methodology which combines the cost of all shares within the
account to compute an average cost per share.
Average cost can be applied as either an affirmative election by the shareholder
or as the reporting broker's default method. Regardless of how applied, an
election by the shareholder to switch to any other reporting method is required in
writing. Shareholders may revoke an average cost election for up to 1 year or
until the time of the first redemption. Reporting brokers have the option to
extend the revocation period for longer than 1 year but cannot extend it past the
date of the first redemption. A revocation of average cost will "unwind" the
average cost election and restore the individual basis of the lots in an account. If
the revocation period is expired, a shareholder may request a change in their
basis method prospectively. In addition, under the current regulation
shareholders utilizing the broker's default method of the average cost method
can only change their basis method prospectively. (Note: the industry has
requested that this requirement be changed.)
Prior to the mandatory cost basis reporting requirement average cost served as
the default cost basis calculation methodology for most mutual fund companies.
Acquisition Date
The date shares were acquired by the shareholder. In most instances, the
acquisition date will be the same as the trade date of the purchase. However,
there may be occasion when the purchase date is not known. When this occurs,
although the acquisition date may be defaulted to the date on which the shares
were received in the account, the actual acquisition date must be treated as
unknown. The IRS has special depletion guidelines for shares with unknown
acquisition dates.
Basis or
Cost Basis
The original and/or adjusted cost of shares acquired by a shareholder, used for
calculating a gain or loss when shares are redeemed.
The original basis of mutual fund shares depends on how the shares were
acquired. The original basis for shares that were purchased or acquired through
reinvestment of a dividend is generally the original cost of the shares. If the
mutual fund has had distributions that were identified as a return of capital, then
basis would be adjusted by the amount of capital that was returned to the
shareholder. This basis would be referred to as an adjusted basis. Shares
acquired through inheritance will generally have the market value of the shares
on or around date of death as the adjusted cost basis. Shares acquired as gift
will generally retain the adjusted cost basis of the donor.
Bifurcated Account
A cost basis accounting method that uses two pools of shares in the same
account. One pool is for "covered" shares and one pool is for "non-covered"
shares. (See "Covered" and "Non-covered" Shares)
Broker or Reporting
Broker
The tax reporting responsible party. Where cost basis is concerned, the "broker"
may be the broker/dealer or bank intermediary and/or the mutual fund transfer
agent.
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Term
Definition
Broker-to-Broker
Transfer
Transfers that occur between reporting brokers that may or may not include a
change in beneficial ownership. Transfers require the sending ("delivering")
broker to provide basis information (see "Transfer Statement") to the "receiving"
broker within 15 days of the transfer. Transfers between reporting brokers are
generally the result of the following:
1. The shareholder holds shares direct with the fund transfer agent and
instead decides to hold those same shares as part of a brokerage
account.
2. The shareholder holds shares as part of a brokerage account with a
particular broker/dealer and instead decides to move their assets to a
brokerage account with a different broker/dealer. This is the most
common circumstance.
3. The shareholder holds shares as part of a brokerage account and instead
decides to hold those same shares direct with the fund transfer agent.
Carry Over Basis
Change in Method
Period
When shares are gifted at a value greater than their adjusted cost basis (gifted
as a gain), the cost basis moves intact with the transferred shares. This means
the donor’s basis transfers without adjustment (carries over) to the donee.
Pursuant to IRS Notice 2011-56, a shareholder may choose a method other than
the broker’s default of average cost for existing shares in an account. A
shareholder must choose another method by the earlier of (1) one year following
the notification of the reporting broker’s default method, or (2) the date of first
sale, transfer, or other disposition of shares subject to the broker default (the
“change in method” period). Brokers at their discretion may extend this period
longer than one year, but not beyond the first redemption. If a shareholder
chooses another method other than the broker’s default of average cost during
the “change of method” period, the basis in the shares in the account to which
the method choice applies is the basis before averaging.
Cost Basis
Reporting System
("CBRS")
A service offered by the Depository Trust Clearing Corporation ("DTCC") 27 that
provides for the passing of asset and tax lot level basis information. It is the
preferred method for brokers to furnish transfer statements.
Covered Shares
Shares acquired after the effective date of the legislation (January 1, 2012 for
mutual funds) and for which brokers have received basis information if the
shares were transferred from another broker. Also this would include all shares in
the account if the "Single Account" average cost reporting method is being used.
26F
Brokers are required to report cost basis information as prescribed on Form
1099-B in conjunction with the sale of covered shares.
First-in, First-out
(FIFO)
27
One of the prescribed default basis calculation methodologies for reporting
brokers. When using FIFO, the oldest available tax lots are depleted first when
calculating gain/loss amounts.
DTCC operates its businesses through several operating subsidiaries.
GLOSSARY > 150
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Term
Definition
Gifted/Inherited
Shares
Shares that have been gifted to or inherited by the shareholder. When shares
are gifted, both the donor's basis and the "fair market value" upon the date of
the gift must be transferred to the recipient of the gift. The broker must
maintain both numbers, as the donee's basis may depend on the fair market
value of the shares upon a subsequent sale. Even if shares are gifted at a gain
(the value of the shares is greater than the donor's basis), brokers must carry
both the fair market value on the date of the gift and the donor's basis for future
gain/loss determinations.
The basis for inherited shares defaults to the "fair market value" of those shares
on the date of death, unless an estate representative provides alternative basis
information to the reporting broker.
Highest Cost-in,
First-out (HIFO)
A cost basis methodology that is a form of Specific ID, in which shares are
depleted in the order of highest acquisition cost to lowest acquisition cost,
regardless of how long they have been held in the account.
Highest Long-Term
Cost-in, First-out
(HIFO - Long Term)
A cost basis methodology that is a form of Specific ID, in which shares are
depleted in the order of highest acquisition cost to lowest acquisition cost, giving
first priority to those shares held in the account for at least 1 year.
Highest Short-Term
Cost-in, First-out
(HIFO - Short Term)
A cost basis methodology that is a form of specific ID, in which shares are
depleted in the order of highest acquisition cost to lowest acquisition cost, giving
first priority to those shares held in the account for less than 1 year.
"In-kind" Transfer
to "Like"
Registration
Transfers that occur between reporting brokers where there is no change in the
beneficial ownership (or "customer") of the shares moved. An in-kind transfer
occurs between two reporting brokers where shares are moved from one account
to another account with a "like" or identical registration (transfer from broker to
broker without change in beneficial ownership).
Load Basis Deferral
The load or commission on the purchase of mutual fund shares is normally
included in the adjusted basis of the shares purchased. Most mutual funds that
have a front-end commission will allow shareholders to exchange shares into
other funds that have a similar commission structure without paying an
additional commission. The IRS refers to this right to exchange to another fund
without paying a commission as a reinvestment right. If a shareholder purchases
shares in a mutual fund and acquires reinvestment rights, and then exchanges
into another fund within 90 days by exercising their reinvestment right, then the
shareholder will not be allowed to add the commission or load to the adjusted
cost basis of the shares redeemed. The IRS Regulations specify that the
commission should be deferred and added to the cost basis of the shares that
were acquired by the exchange.
Lowest Cost-in,
First-out (LOFO)
A cost basis methodology that is a form of Specific ID, in which shares are
depleted in the order of lowest acquisition cost to highest acquisition cost,
regardless of how long they have been held in the account.
Lowest Long-Term
Cost-in, First-out
(LOFO - Long Term)
A cost basis methodology that is a form of Specific ID, in which shares are
depleted in the order of lowest acquisition cost to highest acquisition cost, giving
first priority to those shares held in the account for at least 1 year.
Lowest Short-Term
Cost-in, First-out
(LOFO - Short
Term)
A cost basis methodology that is a form of Specific ID, in which shares are
depleted in the order of lowest acquisition cost to highest acquisition cost, giving
first priority to those shares held in the account for less than 1 year.
GLOSSARY > 151
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Term
Definition
Mutual Fund Agent
The mutual fund agent or “MF Agent" is represented as the firm on the National
Securities Clearing Corporation ("NSCC") order that is the party acting on behalf
of an underlying or introducing firm.
Non-covered Shares
Non-covered shares are any shares that are not "covered" shares, as defined by
IRS cost basis reporting regulations. Non-covered shares include those acquired
prior to the effective date of cost basis rules. Brokers are required to send
transfer reporting statements for non-covered shares that otherwise are subject
to 1099-B reporting. Brokers are only required to report "Gross Proceeds" on
Form 1099-B in conjunction with the sale of non-covered shares.
Return of Capital
A distribution received by a shareholder that the mutual fund has concluded is
not income, but instead is a return of a shareholder's capital investment. A
return of capital differs from a sale in that the shareholder does not initiate the
distribution. A return of capital occurs when a mutual fund determines, for any
number of reasons, that distributions made to shareholders throughout the year
have exceeded the earnings and profits of the mutual fund for that year. The
shareholder's cost basis increases for all shares held as of the record date of the
distribution characterized as a Return of Capital.
Revocation Period
The period in which a shareholder that has affirmatively elected the average cost
method may revoke their election. The regulations state that the shareholder has
either 12 months or until the first disposition of shares in which to revoke their
average cost election. The regulations do allow reporting brokers to extend the
revocation period for any length of time but, in no circumstance, can they extend
it past the point in which the first disposition of shares occurs. If a shareholder
revokes their average cost election during the period, the basis of stock to which
the revocation applies is its basis before averaging.
Single Account
Average Cost
("SAAC")
The regulations provide that a single-account election only applies to accounts
with the same ownership. A broker may elect to treat all shares in an account as
covered in computing the average cost basis, regardless of when the shares were
acquired. The broker may only elect to use the single account average cost basis
method when:
1. The shareholder has affirmatively elected in writing to use the average
cost basis reporting method.
2. The broker does not know or have reason to know that the basis
information it has for the account (for both covered and non-covered
shares) is inaccurate.
3. The broker knows that the shareholder has NOT averaged the cost of
shares within the account with the cost of shares held in the same fund
in another account.
Once a single account election has been made by the broker, all shares in the
account become "covered" shares. Once SAAC is implemented, it is irrevocable
by the broker, but the shareholder may revoke their affirmative Average Cost
election during the revocation period (see "Revocation Period"), which will
unwind the SAAC election. Thus brokers must retain individual lot information
for shares in an account for which the single account election is made until the
revocation period for that account has ended. Shares that become covered
shares only as a result of a single account election are no longer covered shares
after the single account election is voided due to a revocation.
GLOSSARY > 152
Cost Basis Reporting Service - Supplemental User Guide for Mutual Funds
Term
Definition
Specific Lot
Identification or
Specific ID
Specific lot identification is a cost basis reporting method, where the shareholder
or their agent (if permissible) identifies the shares that will be disposed of for
cost basis reporting purposes. When selling shares, the shareholder individually
identifies a specific acquisition lot of shares in which to redeem. The basis used
for gain/loss reporting is calculated by summing the adjusted cost basis of the
lots specifically identified by the shareholder.
Specific ID may also include the application of certain formulaic methods for
identifying lots including:

Highest Cost, First Out

Lowest Cost, First Out

Highest Cost Long-Term, First Out

Lowest Cost Long-Term, First Out

Highest Cost Short-Term, First Out

Lowest Cost Short-Term, First Out
Stepped Up Basis
When shares are inherited, and the fair market value on date of death exceeds
the adjusted cost basis of those shares, the cost basis of the transferred shares
is adjusted ("stepped-up") to reflect the higher market value of the asset as of
the date of death. This reduces the potential gain an heir may realize on the
future sale of shares.
Transfer Statement
Reporting brokers are required to provide a "Transfer Statement" upon the
movement of shares from one broker to another. The transfer statement must
be provided by the delivering broker within 15 days of the transfer and, if not
delivered, the receiving broker is compelled to make 1 follow up inquiry as to its
receipt.
Information required on the transfer statement includes:

The date the statement is furnished;

Name, address and telephone number of person furnishing the statement
and broker receiving custody of the security;

Name and account number of customer(s) (both transferring and
receiving);

CUSIP number of the security transferred;

Date transfer was initiated and settlement date of transfer (if known);

Total adjusted basis of the security, original acquisition date, and, if
applicable, any holding period adjustment required due to a wash sale.
Allowance is made in the regulations to allow brokers to agree to combine this
information in any format or to use a code in place of one or more required items
(e.g. use of NSCC Participant Numbers).
Wash Sales
If mutual fund shares are sold at a loss and within 30 days before or after that
sale a subsequent purchase of substantially identical shares is made, then a wash
sale is deemed to have occurred. Shareholders are not permitted to deduct
losses as a result of a wash sale.
GLOSSARY > 153