Past version: Effective up to 21 Apr 2019
Without prejudice to such audit and/or reporting requirements as may be imposed by the Clearing House from time to time, a Remote Clearing Member shall furnish to the Clearing House:
2.15.1C.1 within five (5) months of the end of its financial year or within such longer period as may be permitted in writing by the Clearing House, the relevant forms which a Remote Clearing Member is required to lodge in prescribed format under Rule 2.26, a risk-based capital report prepared pursuant to standards prescribed by the Clearing House, management report and the annual accounts duly audited in accordance with the usual accounting standards of the Remote Clearing Member by, and the certificate of, its auditor or auditors who shall be a public accountant or a firm of public accountants acceptable to the Clearing House. The certificate shall pertain to the audit conducted by such auditor or auditors in respect of the financial year aforesaid and shall state, at a minimum:
a. whether, in the opinion of the auditor or auditors, the Remote Clearing Member has complied with the capital and financial requirements set out in this Rules;
b. whether, in the opinion of the auditor or auditors, the Remote Clearing Member's books of accounts and records are those usual in a business of that nature and appear to have been kept in a proper manner in accordance with the provisions of this Rules and any applicable laws and regulations;
c. whether, in the opinion of the auditor or auditors, the financial position of the Remote Clearing Member is such as to enable it to conduct its business on sound grounds, having regard to the nature and volume of the business transacted during its past financial year as shown by its books of accounts and records; and
d. whether the auditor or auditors has or have obtained all the necessary information and explanations for the proper conduct of the audit and to enable him or them to furnish his or their certificate;
e. where, in the performance of his or their duties, the Remote Clearing Member's auditor or auditors becomes or become aware:
i. of any matter which in his or their opinion adversely affects or may adversely affect the financial position of the Remote Clearing Member to a material extent;
ii. of any matter which in his or their opinion constitutes or may constitute a contravention of any provision of this Rules, the SFA and/or any applicable laws or an offence involving fraud or dishonesty;
iii. of any irregularity that has or may have a material effect upon the accounts, including irregularities that jeopardize the moneys or other assets of any customer of the Remote Clearing Member; or
iv. that the accounting system, internal accounting control and procedures for safeguarding moneys or other assets are inadequate and the inadequacies have a material effect on the accounts,
the auditor or auditors shall immediately report the matter to the Clearing House; and
2.15.1C.2 an audit report certified by an auditor or auditors, who shall be a public accountant or a firm of public accountants acceptable to the Clearing House, who shall have been engaged by the Remote Clearing Member to conduct an audit of its operations annually or at such times and within such scope as prescribed by the Clearing House and a report on the follow-up actions taken by the Remote Clearing Member by such time as may be prescribed by the Clearing House. The external audit report shall state, at a minimum:
a. whether, in the opinion of the auditor or auditors, the Remote Clearing Member has complied with the requirements set out in this Rules;
b. whether the auditor or auditors has or have obtained all the necessary information and explanations for the proper conduct of the audit and to enable him or them to furnish his or their external audit report; and
c. where, in the performance of his or their duties, the Remote Clearing Member's auditor or auditors becomes or become aware of any matter which in his or their opinion constitutes or may constitute a contravention of any provision of this Rules, the SFA and/or any applicable laws, the auditor or auditors shall immediately report the matter to the Clearing House.
Added on 31 December 201331 December 2013.