EFFECTIVE MATURITY Definition

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EFFECTIVE MATURITY is the date used in place of the final maturity for bonds with call, put or prepayment features. This date mathematically incorporates the effect of those optional maturity dates.

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ACCRUAL is the recognition of revenue when earned or expenses when incurred regardless of when cash is received or disbursed.

SAFETY STOCK (SS) or security stock ensures that the item is available up to the pre-defined required service level, even when the re-ordered material arrives later then expected, or the fluctuations in demand during the lead-time cause the demand to be larger then expected. See also STOCK RESERVE.

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