Original Issue Discount Accretion

Original issue discount accretion is the recognition over time of a loan’s original issue discount as income under the applicable accounting method. It can increase reported income before equivalent cash is received.

Why this matters to income investors

Accretion can support reported earnings while cash realization depends on the borrower paying as agreed. Check its size and the associated loan quality.

How to use original issue discount accretion in your research

Separate cash received from income recognized without current cash. Compare the trend with borrower payment quality and the company’s recurring earnings before relying on it to support dividends.

This material is general education and information, not individualized investment, tax, or legal advice.