Stock Record

A stock record is a detailed listing of securities held by a brokerage firm on behalf of customers. The stock record displays the names of the real and beneficial owners, amounts and locations of all securities held by the firm. The record must be updated any time a trade is executed. Since today's brokerage firms hold shares in street name for investors, meticulous bookkeeping is necessary for keeping track of the actual owners of the securities.

Before advances in computerized technology on Wall Street, stocks were issued as physical certificates. Stock records for holding securities in street name eliminated the need for a brokerage firm to transfer the paper securities to the customer. This system simplified transactions and significantly reduced the time required to settle trades. Currently, SEC Rule 17a-3 and Rule 17a-4 outline the minimum requirements of record-keeping in terms of creation procedure, maintenance practices and the length of time the records must be kept. These rules are installed for protection of the customers and enable SEC audits for compliance.

The stock record department is charged with maintaining accurate records. For each security position, the stock record department must identify the owner, quantity of stock and location where the security is held or deposited. If stocks are held on deposit at the Depository Trust Company (DTC), the department must register on its own books the matching information. Reconciliations for discrepancies are handled by the department on a daily, weekly, or as-needed basis. Stock record "breaks" or "exceptions," where trade transactions were incorrectly processed, are also resolved by the department.