WebTrends Analytics Software Quick Start Guide
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R
EADINESS CHECKLIST
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UPERVISION DEPARTMENT
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Appendix II
R
EADINESS
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HECKLIST
F
OR
INVESTMENT ADVISER
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TABLE OF CONTENTS
Page
GENERAL INFORMATION
3
ORGANISATION STRUCTURE
4
A. Background
4
B. Organisation Chart
4
C. Operational Manual – Internal Procedures
4
D. Facilities and Security
4
1. QUALITATIVE CRITERIA
a. Shareholders
5
b. Board of Directors
5
c. Management
5
d. Staff Strength
6
2. LICENSING REQUIREMENTS
a. Authorised And Paid-Up Capital
6
b. Net Tangible Assets
6
c. Directors
6
d. Shareholders
7
e. Investment Representative
7
3. RESEARCH
a. Operation
8
b. Client’s Agreement
9
c. Record Keeping
10
4. PROPRIETARY TRADING
10
5. EMPLOYEE TRADING
10
6. INTERNAL CONTROL
10
7. COMPLIANCE
11
8. INFORMATION TECHNOLOGY
A. IT Organisation
11
B. Investment Advisory Reports
11
C. Web-Site
11
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GENERAL INFORMATION
1.
Date Of Incorporation And
Registration Number
2.
Business Address
3.
Registered Address
4.
Telephone number
5.
Facsimile number
6.
E-mail address/web-site/Domain
Server
7.
Primary Contact Person (include
designation / position)
8.
Statutory Auditor
9.
Company Secretary
10. Panel Solicitors
11. Financial Year End
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ORGANISATION STRUCTURE
YES NO
N/A COMMENTS
A. Background
1.
Details of the capital and group
structures.
2.
Details of Board of Directors.
3.
Details of Committees. (if any)
4.
Details of Investment Representatives
5.
Details of subsidiaries or related
companies.
B. Organisation Chart
Details of the organisation chart of the
Company.
C. Operations Manual – Internal
Procedures
1.
Does the company has an Operations
Manual? Provide a copy of the
Operations Manual.
D. FACILITIES AND SECURITY
1.
Is the company’s business premises
ready for operations?
2. Are the following facilities for the purpose
of conducting the operations of the
company in place?
a)
Telephone lines and facsimile;
b)
Price reporting systems;
c)
Voice recording system;
d)
Furniture and fittings;
e)
Computer hardware and software;
and
f)
Others (please specify).
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1. QUALITATIVE CRITERIA
YES NO
N/A COMMENTS
a.
Shareholders
1.
Do the shareholders have experience in
investment advisory activities or other
relevant industries?
2.
Are there written policies and procedures
on the declaration of shareholders’
interests?
b.
Board of Directors
1.
Do the directors have the necessary
qualifications, industry experience and
knowledge about the industry?
2.
Are there written policies and procedures
on declaration of directors’ interests?
3.
Has the Board formulated policies and
procedures, comprising, amongst
others, proper description of duties and
functions of the company?
c.
Management
1.
Are there written policies and procedures
for all operations of the company?
2.
Are these policies and procedures
approved by the Board?
3.
Is there a written policy for reporting
and frequency of reporting to the
Board?
4.
Is there an Internal Code of Conduct?
d.
Staff Strength
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1.
Are permanent employees
identified/recruited for the operations of
the company?
2.
Is the manpower in terms of number,
qualification and experience adequate?
3.
Are the employees aware of the policies
and procedures of their respective
areas?
2. LICENSING REQUIREMENTS
a. Authorised And Paid-Up Capital
1.
Are the authorised and paid-up capital
maintained at the minimum level of at
least RM500,000?
b. Net Tangible Assets (“NTA”)
1.
Is the NTA maintained at the minimum
level of at least RM 50,000?
c. Directors
1.
Are any of the directors licensed or
registered in any capacity in or outside
Malaysia under any law that requires
licensing or registration to deal or trade
in securities?
2.
Is the Bumiputera composition of its
shareholders, directors, Investment
Representatives and employees
maintained at the minimum level of at
least 30%?
3.
Is at least one of the directors licensed
as an Investment Representative?
d. Shareholders
1.
Is there any foreign ownership in the
shareholding structure?
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2.
Is the foreign ownership approved by
the FIC?
e. Investment Representative
1.
Are there relevant training programmes
for the Investment Representatives?
[The conditions of the investment
adviser licence states that the holder of
the licence shall ensure that all its
representatives are trained and will
receive continuous training]
2.
Do the Investment Representatives
have experience in the industry? (Obtain
the Curriculum Vitae of the Investment
Representatives and a certified copy of
the certificate evidencing academic
and/or professional qualification.)
3.
Is there a recruitment policy to ensure
that the Investment Representatives
that are recruited are consistent with
the requirements (in terms of quality) of
the company?
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3. RESEARCH
a. Operation
1. Are there measures to ensure
compliance with section 39 of the
Securities Industry Act 1983 on
disclosure of interests?
[Section 39 (1) – where an investment
adviser or an investment representative
sends written communications in which
he makes a recommendation, the
written communication shall include a
concise statement of the nature of the
relevant interest in, or any interest in
the acquisition or disposal of, those
securities or securities in that class that
investment adviser or investment
representative or person associated with
him has at the date the written
communication is issued.]
[Section 39 (7) – the written
communications above shall be
preserved for a period of seven years]
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2. Are there policies and procedures on
verification of recommendations given
by Investment Representatives?
[Section 40A (1) – An adviser shall not
make any recommendation without
having a reasonable basis for making
the recommendation]
[Section 40A (2) – An adviser does not
have a reasonable basis unless:
(a) the adviser has taken into account
the investment objectives, financial
situation and particular needs of the
person (client)
(b) the adviser has given reasonable
consideration to and conducted
investigation of the subject matter
of the recommendation
(c) the recommendation is based on
such consideration and investigation]
3. Do the directors or the Head of
Research verify recommendations made
by the Investment Representatives?
4. Does the Company subscribe to
research or information services? If yes,
list the services and how they are used
to support decision making?
5. Is there a research library?
6. Are there “Chinese walls” policies on
confidential research information (price
sensitive items)?
b. Client’s Agreement
1. Are there policies and procedures to
ensure that a written agreement
(client’s mandate) is entered into with a
client before any services are provided
to client?
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c. Record Keeping
1. Are there policies and procedures to
ensure that accounting records and
other records are properly kept?
4. PROPRIETARY TRADING
1.
Is proprietary trading/own investment
conducted?
2.
Are there policies and procedures for
proprietary trading activities?
5. EMPLOYEE TRADING
1.
Is employees’ trading allowed?
2.
Are there policies and procedures on
employees’ trading?
3.
Is a register for employees’ transactions
maintained?
4.
Are there policies and procedures on
actions to be taken against employees
who breach the policies?
5.
Is there a “cooling-off period” for
employees to transact in securities to
minimise potential conflict of interest
situations?
6.
Is there a policy on declaration of
employees’ interests?
6. INTERNAL CONTROL
1.
Are there policies and procedures on
internal control? Please append a copy
of the company’s internal control
procedures.
2.
Are the employees aware of the internal
control procedures?
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7. COMPLIANCE
1.
Are there policies and procedures for
action to be taken against non-
compliance with the company’s policies
and procedures and the securities laws?
8. INFORMATION TECHNOLOGY
A. IT Organisation
1.
Is there clear segregation of duties to
prevent any individual having full access
to the computer systems?
B. Investment Advisory Reports
1.
Are there policies and procedures on
sending client’s investment advisory
reports or articles via e-mail which
includes:
•
Authorisation; and
•
Backup copies of reports or articles.
C. Web-Site
1. Are there network diagram and linkages
for the web-server and web-site?
2. Is there an identified personnel
responsible for the maintenance of
web-server and web-site?
3. Are there policies and procedures on the
maintenance of web-server and web-
site which include procedures to
minimise access disruptions to the web-
site?
4. Is there a service level agreement or
maintenance agreement with its
vendors?
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5. Are there security measures for clients’
access to the designated web-site?
6. Are there IT policies and procedures for
the web-site which includes:
•
Password security controls
•
User Id administration
•
Review of system audit trails
•
Secure communication protocols for
the transmissions over the networks
•
Posting of investment advisory
articles (i.e. contents management)
•
Safeguard to clients’ information.
Chat Room / Forum
1. Are there policies and procedures to
monitor and filter comments that are
considered “risqué” (inappropriate, i.e.
racist, obscene, manipulative in nature)
from being posted on its chat rooms or
forums by clients?
On-Line Payment
1. Is there an agreement for payment
processing and client’s verifications?
2. Are there security measures for the
online payment processes?
Completed and Reviewed:-
Completed by:-
Date:-
Reviewed by:-
Date:-
