A contract note is the confirmation note for the stock exchange transaction entailing all relevant information pertaining to the trade such as the order number, nature of security being traded, price paid or received during the trade, total value, date and time, brokerage, taxation rates among others. The note is delivered by the brokerage house to the client. With the online trading system in place, contract notes delivered by post are now e-mailed to the client.
Further in this respect, NSE has come up with the prescribed format for the Common Contract Note. According to the circular on the site, members are requested to issue contract notes in the format prescribed by April 01, 2014. The move to do away with the existing system of issuance of different contract note for different trading segments as well as exchanges comes on the backdrop of brokerages representation to the SBI for rationalizing the documentation procedure.
Other notice on the provision of Common Contract Note on the BSE website said "Further, trading members are requested to comply with the above requirements on or before April 1, 2014. An Operating Instruction will be issued in due course."
The issuance of single contract note for all the stock exchange transaction is likely to reduce record maintaining work both at the client's as well as brokers end. Further, confirming the need as well as advantage of single contract note, Edelweiss Financial Services Head-Capital Market, Nitin Jain was quoted in Business Standard report saying "The current system is not very customer-friendly, with all the details of different orders executed at different times in different segments. It would be far more useful if a client can get a summary in one place, with price and quantity information".