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Accretion (of a discount)

In portfolio accounting, a straight-line accumulation of capital gains on a discount bond in anticipation of receipt of par at maturity.


1. The capital gains a bondholder receives when he/she buys a bond at a discount from par and expects it to mature at par. For example, if one buys a bond at 90% of par, the accretion is 10%. Unless the bond is tax exempt, accretion is taxable each year even though the bondholder does not actually receive any payments until maturity. See also: Imputed value.

2. The addition of value as the result of an outside event. For example, an accretive acquisition occurs if an acquisition increases a company's earnings per share.


The accumulation of capital gains on discount bonds with the expectation that the securities will be redeemed at maturity. Excluding municipals, the amount of annual accretion is taxable on an original-issue discount bond even though only a small amount of interest or no interest at all is paid each year. See also imputed interest.


The addition of land through natural causes, such as gradual silting.You will often see accretion used to also describe the addition of land because of receding waters, but this is more properly called dereliction.
References in periodicals archive ?
At Accretive Health, we are inspired daily by those we serve and are driven to succeed for our partner clients so they can continue to meet the vital healthcare needs of their communities.
"We are very happy in the space and now planning to expand," says Accretive's Office Manager, Bonnie Banks.
RGP is acquiring Accretive for USD 19.4m in cash and 1.15m shares of Resources Connection, Inc.
The acquisitions, combined with the supporting capital raise, are expected to be over 15 percent accretive to 2016 earnings per share and 4.50 percent accretive to tangible book value reported at December 31, 2014.
The acquisition is expected to provide three-year revenue growth CAGR of 12% with accretive EBITDA margins and Free Cash Flow Conversion of approximately 80%, and to be accretive to EPS and generate free cash flow in Q4.
M2 EQUITYBITES-November 3, 2017-RGP Acquires Chicago-Based Staffing and Outsourcing Solutions Provider Accretive in Cash/Stock Transaction
Broadridge anticipates the NACC business will be immediately accretive to its GAAP and adjusted earnings, inclusive of incremental interest expense.
Chicago, IL, March 29, 2015 --( Accretive Health, Inc.
Home Bancorp anticipates the transaction will be accretive to earnings per share in the first full year of combined operations and accretive to tangible book value per share within two years of closing.
Excluding deal related costs and amortisation expenses, the acquisition is expected to be accretive to earnings for the fiscal year ending 31 March 2011, while including these expenses, the acquisition is expected to have a negligible affect on earnings per share for this period.
The acquisition is predicted to be accretive to Semtech's GAAP earnings per share within 12 months and is expected to be immediately accretive to Semtech's non-GAAP gross margins and non-GAAP earnings per share.
The deal will be accretive to earnings per share in 2006.