1. Copyright 2005 The 2008 FAIS Report Presented by Richard Rattue

2. Copyright 2008 Agenda THE ANNUAL REPORT Section 17(4) FAIS Session 1 09.00 -10.30 Submission and Deadlines Report Review: Category 1 (With / out CO) Break 15 mins 10.30-10.45am Session 2 10.45 – 11.00 Report Review: Category 2 Session 3 11.00-11.30 Report Submission : FSB Presentation Session 4 11.30-12.00 Questions & Close

3. Copyright 2008 Housekeeping Please make sure that you have registered Copies of all presentations will be on our website for download next Monday Upon receipt of payment delegates will receive our internal guidance papers on the report via email. FPI Members will get 3 CPD points Delegates will need a copy of the relevant report for this session. Please switch off cell phones

4. Copyright 2008 Introduction Report to be completed by all FSP’s in terms of Section 17(4) of FAIS Report has four flavours Category 1 FSP’s Category 2 FSP’s Category 3 FSP’s Separate report if you do not require a CO in terms of Section 17(1) of FAIS

5. Copyright 2008 2008 Report Overview Fewer sections overall Fewer questions due to consolidation More focus on key risk areas i.e J Reps Amalgamation of prior questions Additional Monitoring Areas for CO’s Improved structure New Sections i.e Risk Man & Terminations More Annexures for Cat 1 FSP’s No efficacy or sampling submissions required from CO’s

6. Copyright 2008 Clarity of Terms Report Date Report Period Submission Date

7. Copyright 2008 FSP Yr EndReporting Date 31 Jan31 July 28 Feb31 Aug 31 March30 Sept 30 April31 Oct 31 May30 Nov 30 June31 Dec 31 July31 Dec 31 Aug31 Dec 30 Sept31 Dec 31 Oct31 Dec 30 Nov31 Dec Gazetted Table A

8. Copyright 2008 Revised Reporting Dates Reporting DateSubmission Date 1. 31 May15 August 2. 31 August31 October 3. 31 December28 February Reporting Type 1. = Cat 1 FSP’s with CO 2. = Cat 2 & 3 & Forex Only FSP’s with CO 3. =FSP’s that DO NOT require a CO

9. Copyright 2008 Report Columns 1 Yes compliant 2 No non compliant 3 Not applicable Cannot enter in shaded areas of report 4 Developmental area areas of concern identified and are to be fixed in a reasonable time frame 5 Annexures or numbers Number your submissions correctly

10. Copyright 2008 1. License Conditions and Restrictions / Financial Products Fewer questions Advise Registrar within 15 days of any changes 1.4.1 / 1.4.2 Details of other regulators 1.5.4 – Details of related parties where applicable 2. Key Individuals Control of K.I.’s. Changes in circumstances. Fit and Proper Advancement 2.3.3 Procedures to meet Column 4

11. Copyright 2008 3. FSP License Display of original or certified copy of license at every business premises. 4. R epresentatives 4.3 / 4.4 Juristic Rep Controls Keeping control of your Reps and their Fit & Proper status. Disclosure of supervised Reps and status and No of supervisors Ongoing reviews /assessment of Reps under supervision. Attachments re procedures 4.5.3.8.Non compliance Report Compliance of all Reps with the Gen Code of Conduct. Debarment Details.

12. Copyright 2008 5. Insurance Cover Fidelity guarantee provides an employer with insurance cover for financial loss resulting from an employee's dishonesty. PI Cover: purpose is to cover your company against the potential liability and claims caused as a result of the professional work you undertake. Guarantees: A guarantee is effected to provide protection against an uninsured contingencies Intermediaries Guarantee Facility (IGF).

13. Copyright 2008 6. Compliance Function. Status of Compliance Function CO Function Status Regular reports submitted by the CO. Quarterly Removed Number of visits for outsourced CO’s 6.4 CO to highlight additional issues Efficacy Statement Removed

14. Copyright 2008 7. Record Keeping. Section 18 verbal communications with clients complaints. non compliance i.e. /breaches register premature cancellation of transactions. Continued compliance of Reps Section 3.2 Gencode. electronic /safe storage etc accessible within 7 days Longevity ( 5 years after product termination date.

15. Copyright 2008 8. General Code of Conduct. 8.1 General Provisions. 8.1.1 Conflict of Interest Policy 8.1.2 Submit as an Annexure Receipt of non cash incentives. Disclosure thereof. 8.2 Disclosures. 8.2.1. Direct Marketer 8.2.3. Details of non compliance iro Section 4,5,7. of General Code 8.2.4. Provide copy of disclosure doc as an Annexure

16. Copyright 2008 8.3 Direct Marketing Voice recording systems in place CO monitoring of disclosures required 8.3.2.4 Non Compliance Annexure Required 8.4 Advice CO monitoring of Analysis and Record of Advice required 8.4.2.5 % iro Section 8(4)a 8.4.2.6 Non Compliance Annexure Required –Record of Advice

17. Copyright 2008 8.5 Fund Custody. If yes you need. Auditor. Section 19(3) Report Separate Accounts Premium Collection Section 45 of STI Act 8.5.4 – Amount of IGF Cover 8.5.5 – IGF Number 8.5.6 - IGF Cover Schedule CO to monitor procedures

18. Copyright 2008 8.6 Risk Management. Section 11 & 12 Gen Code 8.6.2 RM Plan Documented 8.6.3 CO to monitor RM Plan 8.6.4 Submit details of how RM plan is monitored 8.7 Advertising. 8.7.1 –Does FSP Advertise Procedures in place to comply with Section 14. Telephonic Advertising CO to monitor voice logging 8.8 Complaints. Resolution mechanisms that comply with Sections 16-19 of the Gen code Records of Complaints 8.8.3 CO to submit annexure

19. Copyright 2008 8.9 Termination Procedures Procedures to comply with Section 20 (Termination of client relationship) (Termination of FSP business) (Termination of Rep) 8.10 Waiver of Rights. Reps to use approved documents to ensure no waiver of rights is requested or induced form the client. 8.10.2 –CO Required to monitor compliance with Sect 21 of Gen Code 8.10.3 – Details of non compliance on Annexure

20. Copyright 2008 9. Exemptions Board Notice 104 Temp Exemption for Cat A providers from minimum qualifications. Board Notice 97 Exemption of executors, liquidators and other related persons. 9.2.2.1. –CO Required to monitor compliance with BN 97 9.2.2.2 – Details of non compliance on Annexure

21. Copyright 2008 10. Money Laundering Control Customer Identification Record Keeping Staff Training Reporting Copy of Internal rules required Money Laundering Control officer details FICA Exemption 4 Usage 10.7. Procedures to enable staff to identify and report 10.8 Procedures to Risk Rate clients 11. Financial Soundness Solvency Requirements Section 19 Monthly Records

22. Copyright 2008 SECTION 2 – Forex FSP’s Consolidated Questions in 2008 Forex FSP’s Duties & Obligations 12.1 -12.4 Forex Investment Advisors 12.5.1 - 12.5.8 12.5.5 Details of trading platform /system used

23. Copyright 2008 SECTION 3- Health Service Benefits 13.2.1 – Details of Suspensions, withdrawals or lapses in Annexure 13.2.2.- ORG and BR numbers required 13.2.3 – Corporate Client Info

24. Copyright 2008 Section 4 Attachments and Signature All attachments to be referenced to the relevant question number Both Compliance Officer and a key individual to sign off the report before submission is made to the regulator

25. Copyright 2008 Compliance Report 2008 NO CO To be completed by all individuals who do not need to appoint a compliance officer in terms of Section 17(1) of FAIS Slimmed down version. Less annexures No sampling Signed off by KI of FSP

26. Copyright 2008 Report Structure SECTION 1. To be completed by all FSP’s SECTION 2. Forex FSP’s Only SECTION 3 Health Services Benefits SECTION 4 Annexure(s) and sign off

27. Copyright 2008 1.License Conditions Updating Information Financial Product Controls 1.4 Other Regulators –New Annexure 1.5.4 Related Party Information 2.Key Individuals Circumstances and Conditions 2.2 Column 4 Fit and Proper 3.License Display Original or Certified copy 4.Staff Compliment Annexure Required 5.Insurance Cover

28. Copyright 2008 Section Overview 6 Compliance function 7Record keeping 8.1 General Provisions 8.2 Disclosure 8.3 Direct Marketing 8.4 Advice 8.5 Product custody 8.6 Risk Management 8.7 Advertising 8.8 Complaints 8.9 Termination of Agreement or Business 8.10 Waiver of rights 9.0 Exemptions 10 Money Laundering 11 Financial soundness

29. Copyright 2008 15min Break

30. Copyright 2008 Welcome back to the second session

31. Copyright 2008 Discretionary FSP’s Section 1 - same as Category 1 FSP’s.Except 9.3 Additional Exemption BN 15 of 2008 (Supervision) 9.3.1 CO to report on usage by FSP Section 2 12.1 Obligations /Prohibitions 12.2 Mandates 12.3. Reporting 12.3.2 Section 6 Compliance

32. Copyright 2008 Discretionary FSP’s 12.4 Administration 12.4.2 Details of Computer packages iro admin 12.4.3 Outsource arrangements iro admin 12.5 Assets under Management 12.5.2 Audit Status of accounts Nominee Companies Questions Consolidated General Functions Wrap Fund Details Hedge Fund Details 12.7.5 Names of product supplier used by HF FSP

33. Copyright 2008 FSB Presentation Ronel Reyneke Specialist Analyst FAIS SUPERVISION

34. Copyright 2008 Closing thoughts Take it seriously Honesty is the best policy. Compliance Officer / Key Individual should not compromise report content. Get it in on time.

35. Copyright 2008 Knowledge Service ( Logon for 14 Day Free Trial ) Financial Services Compliance Portal Key Regulatory Information at your fingertips Targeted to the Compliance Community Internal CO’s Compliance Practices

36. Copyright 2008 Thank you We hope to see you again soon