A floating rate note (FRN) which in which interest (coupon) accrues only on days when the reference rate (floating rate) such as LIBOR trades through a predetermined barrier level. The barrier may be from above (upper barrier) or from below (lower barrier). In cases where there are two barriers (dual barrier), the note becomes a range accrual note.

By nature, accrual FRNs are subject to daily observations (in which case daily LIBOR is used).