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  • C4-4.2 C4-4.2 Risk Management Framework

    • C4-4.2.1

      The risk management framework of category 4 investment firms must provide for the establishment and maintenance of effective systems and controls including Board approved policies that enable the licensee to identify, measure, monitor and manage the major sources of risk arising from its own books and those arising from the CIU it operates in each of the following categories:

      (a) Counterparty risk;
      (b) Market risk;
      (c) Liquidity risk;
      (d) Operational risk (including where relevant cyber security risk);
      (e) Outsourcing Risk; and
      (f) Any additional categories relevant to its business.
      Added: January 2022

    • C4-4.2.2

      Category 4 investment firms must have contingency arrangements to ensure, that they can access sufficient liquid financial resources to meet liabilities as they fall due.

      Added: January 2022

    • C4-4.2.3

      The risk reporting and monitoring systems of category 4 investment firms must be independent of the employees who are responsible for exposing the licensee to risk.

      Added: January 2022

    • Valuation

      • C4-4.2.4

        Category 4 investment firms must have policies and procedures for valuation of assets under management. Wherever possible, the licensee must use mark to market approach for valuation purposes. Where mark to model approach is not used due to lack of market prices, licensees must follow internationally recognised standards for valuation. Licensees must also utilise independent valuation experts to verify accuracy of valuation models.

        Added: January 2022

    • Business Continuity Planning

      • C4-4.2.5

        Category 4 investment firms must maintain a business continuity plan (BCP) appropriate to the size and complexity if its operations. The BCP must include procedures for ensuring that critical systems, functions and operations can be maintained or recovered in a timely manner in the event of a disruption

        Added: January 2022

    • Review

      • C4-4.2.6

        Category 4 investment firms must establish mechanisms, including internal audits, to verify that controls, once established, are being followed.

        Added: January 2022