> ## Documentation Index
> Fetch the complete documentation index at: https://docs.thedecard.com/llms.txt
> Use this file to discover all available pages before exploring further.

# The transaction life cycle

> A transaction's full journey from authorization hold (UNPOSTED) to settlement posting (POSTED), plus the fund semantics of reversals, refunds and chargebacks, and debt.

## 📄 Guide

Understanding a transaction's full journey from authorization to settlement helps you reconcile correctly and present transactions and balances to your customers accurately. A transaction passes first through authorization, then through clearing / settlement, typically hours to days apart.

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  <img className="block dark:hidden" src="https://mintcdn.com/dcs-0bf7a937/oUoeUKtwWWK2o-Li/imgs/en/diagrams/corp-txn-lifecycle-light.svg?fit=max&auto=format&n=oUoeUKtwWWK2o-Li&q=85&s=4d6cfa625d3fcf98579d4ef04a862bf2" alt="Transaction from authorization to posting" width="818" height="126" data-path="imgs/en/diagrams/corp-txn-lifecycle-light.svg" />

  <img className="hidden dark:block" src="https://mintcdn.com/dcs-0bf7a937/oUoeUKtwWWK2o-Li/imgs/en/diagrams/corp-txn-lifecycle-dark.svg?fit=max&auto=format&n=oUoeUKtwWWK2o-Li&q=85&s=83fda06514256679ac55f140472e2e2a" alt="Transaction from authorization to posting" width="818" height="126" data-path="imgs/en/diagrams/corp-txn-lifecycle-dark.svg" />
</Frame>

## Two stages and four branches

* **Authorization.** When the cardholder pays, DCS checks the entity's status, the velocity rules and the available balance in real time; on approval it holds the amount and consumes the corresponding limit quota. No money has actually left yet — the transaction appears on the statement as an authorization hold (`postStatus` = `UNPOSTED`).
* **Clearing / settlement.** When the merchant later clears, DCS debits the actual settled amount and posts it (`postStatus` = `POSTED`); the transaction lands on the statement for its cycle. The settled amount can differ from the authorized amount (tips, FX differences, or the merchant charging less).
* **Reversal / void.** If an authorization is canceled before settlement, DCS releases the held amount along the original path and restores the consumed limit quota, leaving no residue.
* **Refund / chargeback.** A refund is processed as a separate posting in the opposite direction and does not retroactively unwind historical limit counts; a chargeback is tracked through the dispute process to closure.
* **Debt.** Under delayed settlement or merchant over-capture, the available balance can be driven negative; the account then enters a debt state and the partner is notified by event. The partner repays on schedule.

## Next steps

* The payloads of the authorization and settlement events, and how to consume them: [Real-time authorization and settlement](../how-to-use/realtime-authorization)
* How limits take part in authorization, and how statements read: [Limits and statements](./limits-and-billing)