증권 및 선물(기록 보존) 규칙 / Securities and Futures (Keeping of Records) Rules

5.1 The SFC has made the Keeping of Records Rules, under s. 151, SFO, for intermediaries and their associated entities. The SFC has stated that the records which are required to be kept apply to regulated activities only. However, as the records should be sufficient to produce financial statements, they must show all liabilities. Other relevant requirements and recommendations will be studied under business operations in Topic 5 and Topic 6.

General requirements for intermediaries
5.2 These provide for the keeping of sufficient accounting, trading and other records by intermediaries:
(a) to explain and reflect the financial position and operations of the regulated businesses;

(b) to enable financial statements to be prepared from time to time;

(c) to show all client assets handled and movements in these assets;

(d) to be able to make monthly reconciliations with external parties;

(e) to demonstrate compliance with the FRR, and the specified provisions of the Client Money Rules and the Client Securities Rules;

(f) to demonstrate that the intermediary has systems of control to ensure compliance with the specified provisions of the Client Money Rules and the Client Securities Rules;

(g) which will enable audits to be conveniently and properly carried out; and

(h) which are kept in accordance with generally accepted accounting principles.

The records should include all the items specified in the Keeping of Records Rules and the Schedule attached to the Keeping of Records Rules. A detailed knowledge of the items in the Schedule is not required for the purposes of this manual.

Record keeping requirements for associated entities
5.3 The requirements are similar to those for intermediaries above, in particular providing for the keeping of records by associated entities of client assets, movements in them and in financial items relating to them.

Miscellaneous
Form of records
5.4 The records should be kept, in Chinese or English, in writing or in any other form that may be readily accessed and convertible into writing. The Keeping of Records Rules require all reasonable procedures to be adopted to guard against, and to enable discovery of, any falsifications.

Retention time
5.5 The general rule is that all records should be kept for at least 7 years unless other periods are specified by legislation for any particular records. For example, the Keeping of Records Rules require records documenting orders and instructions received to be kept for at least 2 years, and the Contract Notes Rules require that copies of contract notes should be retained for a period of at least 2 years (see section 6.12 below). Also, the definition of a record in section 2, Keeping of Records Rules excludes telephone recordings, which are covered in the Code of Conduct for Persons Licensed by or Registered with the SFC (“Code of Conduct”). (The Code says that tape records should be kept for a minimum period of 6 months.)

Offences
5.6 A breach of certain requirements in the Keeping of Records Rules will be an offence which will attract penalties, of a fine for a breach without reasonable excuse, and a fine and imprisonment if the breach was committed with an intent to defraud.

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