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I have a question on EUROZONE Bonds and in particular repo accrual and bond accrual.

On a Thursday if we are Short EUROZONE bonds (which have a T+2 settlement lag) in a portfolio (and assuming no move in yields), there is an exaggeration in pull 2 par and hence the P&L on a Thursday will be a lot lower than on any other given day (assume short bonds and bonds trading at a discount to par).
I have a Trader who is experiencing this - his Thursdays are always worse because of this phenomena.

Now what about Bond Accruals and Rep financing accruals.  I would assume the Bond Coupon Accrual would also have an extra 2 days worth of accrual on a Thursday for EUR Bonds - Is that correct?

And For Repos - is that still the case?  Our PM feels the reverse repos should have the extra 2 days worth of positive financing on a Thursday to offset the pull 2 par to a degree - but the system accrues the extra 2 days on a Friday  - This up / down between days increases vol and dampens his Sharpe Ratio!

Does anyone have any thoughts on this and what it would be in the real world / how to treat from an accounting point of view?

Thanks so much!  J.

Start with your accounting policy and let them explain the accounting in detail. This may either be a result of prescriptive accounting rules (in what case you have to live with it) or an artifact of some accounting and implementation choices (in what case this can be corrected).