Accrued interest is a half-year coupon scaled by the days elapsed in the coupon period, and reading the three-decimal figure beside its day count is what makes a gilt's price checkable.
A running total, not a one-off figure
Accrued interest is the slice of the next coupon that has built up since the last one was paid. It exists because coupons arrive twice a year while gilts trade every business day: between two payments the interest owed on the gilt grows by the day, and a buyer has to take over the part the seller has already earned. On the conventional gilts list the figure sits in its own column, with the number of days it covers shown beneath it.
Reading accrued interest correctly means reading two numbers rather than one. The pounds figure is the interest in transit; the day count is what produced it. A row that shows a large accrued amount and a small day count is at an early point in a period with a high coupon; a row with a small amount and a small day count is at an early point in a period with a low one. The pair is the measurement, and neither half alone tells a reader where the gilt sits in its coupon cycle.
The two dates that define the figure
Every accrual runs between two dates. The first is the start: normally the last coupon date that paid, and for a gilt inside an irregular first coupon period, the date it was first issued. The second is the settlement date of the trade, not the day the order was placed. The days between them are the days accrued, and the days in the whole period are the denominator.
A conventional gilt pays half its annual coupon every six months, so the coupon that defines one period is half the annual rate per £100 nominal. The period itself is not a fixed half-year of 182.5 days: it runs from one coupon date to the next on the actual calendar, which gives 181, 182, 183 or occasionally more days. The Debt Management Office's convention counts those actual days, which is why a half-year period is not interchangeable with 182.5 and why the site counts days rather than assuming six months.
The accrual start is not always six months before the next coupon. A gilt issued inside its first coupon period accrues from its issue date, and that first period can be shorter or longer than half a year.
The arithmetic, with every input stated
The figure is the half-yearly coupon multiplied by the days accrued and divided by the days in the period. Take an illustrative gilt with an annual coupon of 4.00, so the half-yearly payment is 2.00 per £100 nominal, in a coupon period of 182 days, with 45 days accrued to settlement. The accrued interest is 2.00 multiplied by 45 and divided by 182, which is about £0.4945 per £100 nominal. The list shows three decimals, so the figure appears as 0.495, and the day count beside it reads 45.
| Input or figure | Value | Where it comes from |
| Annual coupon | 4.00 per £100 | The gilt's own terms |
| Half-yearly coupon | 2.00 | Half the annual rate |
| Days in the coupon period | 182 | Previous coupon date to next coupon date |
| Days accrued | 45 | Previous coupon date to settlement |
| Accrued interest | 0.495 | 2.00 × 45 ÷ 182, to three decimals |
| Clean price | 98.50 | Illustrative market price |
| Dirty price | 98.995 | Clean price plus accrued interest |
Every figure in the table is an illustration rather than a quote from any gilt, and each can be checked from the one above it. The point of the three decimals is that the accrued interest is a small fraction of a large coupon; rounded to two decimals it would move the dirty price by as much as half a penny per £100 nominal, which matters when the figure is multiplied across a large holding.
Why the day count sits beside the pounds
The day count answers the question the pounds figure cannot: how far through its period is this gilt? Two gilts with identical coupons will show different accrued amounts on the same day if their coupon dates fall on different dates, and the days figure is what makes that visible. It is also the cell that changes every business day, where the coupon rate and the period length are fixed by the gilt's terms, so the day count is the moving part of a figure readers sometimes treat as static.
The days count is measured to the settlement date, which is normally one business day after the trade under the T+1 convention the list's footer states. That means a trade placed on Friday is measured to the following Monday's settlement and carries the weekend's accrual. A settlement date further out adds more days, not a different price, which is why a slower dealing route moves the cash without changing the gilt.
Where the figure appears
Beyond the list's columns, a gilt's own page carries the per-£100 cash-flow schedule, which shows the accrued days and the accrued interest on each flow row, so the schedule states the same two figures the list does before it lists the coupons and the final redemption. That is what makes the schedule usable for checking a settlement: the accrued at the settlement date, the clean price and the resulting dirty price are all in one place.
The same figure appears again on a contract note, where it should match to the penny once the settlement date is taken into account. A note that differs by a few pence is usually a day of accrual; a note that differs by pounds is usually a different clean price from a different dealer, and the two are worth telling apart before either is treated as a mistake.
Background, not advice
This article explains how accrued interest is built from a gilt's coupon period; it is general background, not investment, tax or legal advice for any reader's circumstances. The figures above are illustrative, every input is stated, and the exact accrued amount for a gilt comes from the site's calculation against the gilt's own schedule. The Debt Management Office's gilts-in-issue data and the day's market data are the primary sources for a real coupon date, period or accrued figure.