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NISM Certifications · NISM-Series-VI: Depository Operations · Investor Services (NISM VI)

Mr. Iyer wants to receive the benefit of an upcoming cash dividend directly in his bank account. The company will pay on the basis of the record date. Which holding on the record date entitles Mr. Iyer to the dividend?

Mr. Iyer is entitled if the shares are credited in his own demat account at the end of the record date. The depository provides the issuer a benpos list of holders as of that date, and the dividend is paid only to those holders.

  1. AShares credited in his demat account at the end of the record dateCorrect
  2. BShares he sold on the record date but not yet delivered
  3. CShares he plans to buy after the record date
  4. DShares in a demat account of another person

Explanation

The depository gives the issuer a list of BOs holding shares at the close of the record date. Only those holders are entitled to the dividend. Shares sold or bought after that point do not count, and another person's holdings are not his.

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