DTCC has issued a comprehensive document to help clients prepare for the T+1 transition anticipated for next year.
Reflecting the work done by the T+1 Industry Working Group, T+1 Test Approach: Detailed Testing Framework provides granular detail on testing T+1 changes with DTCC and other industry infrastructures and incorporates input from various market segments.
The document includes detailed information on testing cycles and schedules, DTCC’s test environments and how to connect to them as well as suggested test scenarios which members can use to begin their own T+1 test plans.
“The move to a T+1 settlement cycle has been an ongoing industry effort for well over two years,” said Robert Cavallo, director, clearance and settlement, product management at DTCC. “We are halfway through a marathon and still have a long way to go, but now that 2024 is in sight – whether that ultimate date is determined to be March or September – we must move from planning and development to testing.”
With the SEC yet to confirm the final implementation date, the document assumes a September 2024 implementation date but recognises that testing dates may have to change.
While focusing primarily on testing with those DTCC subsidiaries impacted by the move to T+1, the T+1 test plan also includes other infrastructures, such as Nasdaq, Cboe and the Options Clearing Corporation (OCC).
“One of the most critical steps in the move to T+1 will be industrywide testing, so we can all have confidence in our preparations,” said John Abel, DTCC executive director, clearance and settlement, product management. “The number of changes being made to support the move to T+1 – and the number of firms making changes – means we must coordinate these tests across many touchpoints, to ensure readiness and prepare a successful industry implementation.”