RECOMMENDED RETENTION PERIOD

Transcription

1 TO: CHIEF FINANCIAL OFFICERS - IDA JURISDICTION FIRMS PANEL AUDITORS - IDA JURISDICTION FIRMS May 15, 1992 C-38 RECORD The purpose of this interpretation bulletin is to set out the record retention guidelines relating to supplementary information used in the preparation of Monthly Financial Reports (MFR), interim Joint Regulatory Financial Questionnaire (JRFQ&R) and Quarterly Operations Questionnaire (QOQ) including insurance calculations. This bulletin was last issued in January, Record Retention for Examination Purposes Retention in the following guideline refers to retention in a readily available location. After these time limits expire, such information may be placed in long-term off-premises storage subject to industry and statutory record retention guidelines. MFR's - the three most recent MFR filings should be retained. JRFQ&R's - the most recent interim JRFQ&R should be retained. QOQ's - the two most recent QOQ filings should be retained. In addition to the filing, supporting documentation in sufficient detail to enable the Examiners to verify the accuracy of the reports and questionnaires must also be retained. Included in this category are items such as the trial balance (general ledger, clients, brokers and inventory subledgers), status slips, clearing reports, exception and delinquency reports, inventory and client margin reports, interest and dividend reports, security count and reconciliation sheets, segregation control reports, security position record and working papers required to substantiate the daily or weekly capital calculations and monitor of early warning. PLEASE DISTRIBUTE TO ALL INTERESTED PARTIES IN YOUR FIRM SCHEDULE OF Accounting Documents

2 General Ledger Permanent Corporation and Subsidiary Ledgers - client's and inventory control Private Ledger Complementary to general ledger - shows director's personal accounts or drawing accounts Books of original entry and income tax Permanent Corporation act Fixed Asset Records Permanent Corporation act Corporate Records Year-end General Ledger Trial Balance Audited annual financial statements Month-end General Ledger Trial Balance Minute book, share certificate books, etc. Permanent Corporation and Variable depending on internal requirements Permanent Corporation Act Variable depending on internal requirements OF Accounting Documents Monthly Statements Financial Variable depending on internal requirements

3 Corporate Returns assessment etc.) Tax (including notices, Permanent Journal vouchers Purchase orders and requisitions - expenses - fixed assets To authorize internal purchases Variable depending upon internal and auditor's requirements Purchase invoices - expenses - fixed assets Suppliers' statements Suppliers' monthly Variable depending recapitulation of upon internal and amounts owing by auditor's requirements Member Cheque requisitions To originate cheques Variable depending upon internal and auditor's requirements Information available on invoices Information available from cheque OF Banking Documents Cancelled cheques - dividend - others including payroll issued consideration Cheque copies Record of cheques issued 1 month after bank reconciliation Business Bank deposit slips Record of amounts deposited in 3 years Business

4 Member's bank Bank Statements Bank debt and credit advice Bank reconciliations To reconcile bank account 3 years Business OF Documents Relating to Customers Margin Agreement Defines relationship between customer and Member relating to margin account New Application Account Provides necessary information regarding customer and investment objectives Large Form Transaction Provides information pursuant to Money Laundering Regulation 5 years Federal "Proceeds of Crime" Money Laundering Regulation Guarantee Guarantee of an account by someone other than customer 7 years (20 years if under seal at time of execution) from date of termination of guarantees Joint Agreement Account Defines rights and obligations and interests of each of more than one person in account

5 Pledge Agreement Between customer and Member re pledging of customer's securities Nominee Authorization Defines rights of nominee and obligations of beneficial owner Cash Agreement Account Defines relationship between customer and Member relating to cash account OF Documents Relating to Customers Power of Attorney Defines and Written Instructions authority given by beneficial owner to another person or institution Corporate Resolutions Investment Application Club Records names and authority of signing officers Records names and authority of signing officers Estate Forms Authorizes Member (authorization to close to close out account out account) of deceased customer Margin Calls To demand margin 1 month, if record of advice kept Information as to date sent available on customer's ledger cards or statements Buy Agreements Back Evidences Member's agreement to buy back from customer that note agreed to be brought back matures

6 Sell-out Advice short term notes before maturity To advise customer of Member's intention to sell securities 1 month, if record of advice kept Information as to date sent available on customer's ledger cards or statements Stock receipt To record detail and provide evidence of receipt of stock by customer or member OF Documents Relating to Customers Dividend Notice Advice to customer as to debits or credits relating to dividends 1 month Business Put, Call and Straddle Options Records, rights and obligations between customer and Member relating to these options Become filled or unfilled orders - same retention period Confirmation Confirms details of purchase or sale to customer 5 years TSE - 5 years O.T.C. Confirmation Correspondence with customers Confirms details of over-the-counter purchase or sale As above 7 years after account closed OF Employment Documents

7 Earnings Cards Record of earnings by individual Payroll Journals Record of payroll information Employee Information Cards Record of name, age, address and other information re employees Unemployment Insurance Act (Canada) - must keep documents which will enable an Inspector to determine in respect of any employee what contribution, for what period on what date payable and on what date paid by employer. Documents must be kept for 3 years from date of last Certificate of Inspector. Certificates of Inspection must be kept for 5 years. Commission reports Record of commissions earned by salesmen T4 and T5 slips TD1's, beneficiary appointment forms, etc. OF Employment Documents Employee Information Cards Certain additional information depends Employment Standards Act

8 (cont'd) upon requirements of provincial Act, e.g., Ontario (Ontario) - Information for 2 years after work performed re - name and address of employee - age, if under 18 - number of hours worked - wage rate and actual earnings and for 5 years after work performed re - name and address - date of commencement of employment - earnings during each pay period and his vacations Workmen's Compensation Act (Ontario) - departmental policy that records which can verify annual statement required by Act must be kept for 3 years which can verify annual statement required by the Act must be kept for 3 years. OF Trading Documents Order filled Evidences that trader has completed transaction 5 years TSE requirements Order unfilled Evidences that 2 years Ontario Securities

9 transaction was not completed Commission Conditions Registration of Order (open) Becomes one of the above Floor ticket Evidence of completed trade (initialled by other side) 7 years after date of trade TSE Clearing Sheets Evidence of day's trading on TSE 1 year after Member's audit Trading Blotter Contains daily record of all purchases and sales, all receipts and deliveries and shows account for which each transaction was conducted and name of other side in each case 7 years Delivery & Receipt Sheets - Clearing tickets - Transfer sheets To evidence delivery and receipts to and from Exchange clearing house and transfer facilities 7 years Stock records Internal document indicating physical location of securities in possession of Member 7 years OF Trading Documents Clearing Sheets (putons and fails) Record of fails (produced by Exchange) 1 year after annual audit Business Branch Cash Sheets To record daily 2 years Business

10 security and cash movement within branch Transfer posting copy Records details of entries to ledger sheet 1 month Information available on client's ledger sheets Customer's monthend Statements To recapitulate for customer the record of transactions during the month 1 month if on ledger sheets, if not 7 years Information available on client's ledger sheets Dealer's month-end Statements To permit reconciliation of accounts with other dealers Destroy reconciled after Dividend Claim To determine Forms entitlement to - sent and received dividends paid on traded securities 7 years OF Miscellaneous Registered Mail book Record of registered letters sent 7 years Registered Insurance book Brink's book Mail Record of insured mail Record of deliveries by Brink's 7 years 2 years Business Market letters Letters sent to customer's recommending securities 2 years TSE requirements Insurance policies Permanent