DUE BILL

Financial instrument acting as an evidence for documenting and identifying a stock seller’s obligation to transfer a security to the buyer. It is also used when the stock’s buyer is obliged to transfer a pending dividend to the seller. The statement acts as promissory notes and resolves the problem of guaranteeing the right owner receives a stock’s dividend when the stock is trading close to its ex-dividend date. It can also be utilized in the same manner when a firm issues rights, stock splits, or warrants.