ADVOKS GLOBAL · KENYA
The Capital Markets (Conduct of Business) (Market Intermediaries) Regulations
32. Requirements in respect of accounting records
Edition: 2022-12-31 · In force
32. Requirements in respect of accounting records
(1)A market intermediary shall keep proper accounts and records that show the transactions, effected on its behalf or on behalf of others and the financial position of its regulated activity.(2)The records and accounts maintained under paragraph (1) shall—(a)disclose with reasonable accuracy, the financial position of a market intermediary at any given time;(b)enable a market intermediary to prepare a statement of financial position and a statement of comprehensive income at any given time; and(c)show whether a market intermediary is maintaining adequate financial resources to meet its business commitments and withstand the risks to which its business is exposed to.(3)Notwithstanding paragraph (1), the accounting records shall be complete, allow for an independent assessment of the matters in paragraph (1) and contain—(a)day to day entries of all sums of money received and expended by the market intermediary, and the matters in respect of which the receipt and expenditure took place;(b)a record of all the assets and liabilities of the market intermediary including any commitments or contingent liabilities;(c)day to day entries of all purchases and sales of securities by the market intermediary distinguishing those made by the market intermediary on its own account and those made on behalf of others;(d)day to day entries of the receipt and dispatch of documents of title, or documents evidencing title, to securities which are in the possession or control of the market intermediary;(e)day to day entries of—(i)clients’ funds paid into or out of a client bank account maintained for the purposes of these regulations;(ii)receipts and payments of clients’ funds that are not paid into or out of a client bank account, identifying the persons to whom each receipt or payment relates;(f)a record of—(i)the aggregate balances on client bank accounts;(ii)individual client balances allocated against the names of the client;(iii)sufficient information to explain the market intermediary’s dealings with each client bank account, including the time and date;(iv)the time, date and complete particulars of instructions received from and trades executed for clients, including details of short positions;(v)complete particulars of the market intermediary’s orders and trades, including time and date;(g)details of any credit extended or loans made in respect of margin or otherwise; and(h)details of all securities that are—(i)the property of the market intermediary, showing who holds them and if held otherwise than by the market intermediary, details on whether they are held as collateral against loans or advances; and(ii)not the property of the market intermediary, for which the market intermediary is accountable, showing by who or for whom they are held and distinguishing those which are deposited with a third party as security for loans or advances made to the market intermediary or any related person, for any other purpose;(i)any other particulars required from time to time by the Authority or the securities exchange to be contained in the accounting records of a market intermediary.