Blotter and Similar Records
A Broker Dealer shall have blotters or books of original entry containing a historical account of all the daily transactions of the Broker Dealer or its customers. The Broker Dealer may keep a number of different blotters to record separate types of trans actions, provided that the Broker Dealers shall have at least:
- Purchase and Sales Blotter,setting forth for each transaction the purchaser and seller, subject security, confirmation invoice number, quantity, price, amount, any interest or commission, net amount of proceeds from the transaction, trade date, and settlement date;
- In/Out Receipts Book, setting forth the receipt and delivery of securities to and from other Broker Dealers and securities depository in case of stock dividend distribution, including information on the date of receipt or delivery of the securities to or from Broker Dealers, the In/Out Receipt number, name of security, number of shares, and description of such receipt and delivery of securities (e.g. lodgment or upliftment of shares, transfer request by a customer). If the receipt and delivery of shares refer to a transfer of shares by a customer from/to his account with the Broker Dealer to/from his other account with another Broker Dealer, the Broker Dealer should obtain a written transfer request from the customer prior to executing the transfer and keep the document on file;
- Stock Debit Memo (SDM) /Stock Credit Memo (SCM) book setting forth the receipt and delivery of securities to and from customers of the Broker Dealer, including information on the date of receipt and delivery of the securities, the SDM/SCM number, name of security, number of shares, and a short description of such receipt and delivery of securities; and
- Cash Receipts/ Disbursement Book, setting forth the receipt and disbursement of cash, including information on the official receipt/check voucher number, check number, bank account from which cash was withdrawn or deposited, utilization of the cash and accounting entries at the end of each month.
A Broker Dealer shall have a General Ledger reflecting all its assets and liabilities, and its income and expense and capital accounts, and from which a trial balance can be abstracted in order to prepare financial statements showing the Broker Dealer’s financial condition.
A Broker Dealer shall have an individual Subsidiary Ledger of all its asset and liability accounts, and its income and expense and capital accounts which shall set forth the itemized account activity and entries.
A Broker Dealer shall have a Journal Book which shall set forth all entries showing the asset, liability, income, expense, or capital accounts debited and credited, the amounts and the journal voucher control numbers and the description of such entries. Journal vouchers shall be utilized in chronology according to their control numbers.
A Broker Dealer shall have a Customer’s Ledger, which shall set forth the itemized account activity and the securities positions and money balances (beginning and ending positions and balances) of the customer. A complete set of the statements of account of a customer on file with the Broker Dealer can be the Customer’s Ledger.
Detailed Collateral Valuation Schedule
A Broker Dealer shall have a Detailed Collateral Valuation Schedule, which shall set forth the name of the customer, money balance, name of security, number of shares, market value of position, and percentage of total market value of position of customer over money balance.
Securities In Transfer Ledger
A Broker Dealer shall have a Securities In Transfer Ledger, which shall show the number of the transfer receipts received from the transfer agent, the number of shares, name of security, name of previous owner, name of new owner, date sent out to transfer agent, old certificate number, date received back from transfer, and new certificate number.
Dividends and Interest Received Ledger
A Broker Dealer shall have a Dividends and Interest Received Ledger, which shall show the name of the security, the ex- dividend date (or interest date), the rate per share, and the payment date.
Securities Borrowed and Securities Loaned Record
Broker Dealer shall have a record of securities borrowed to make deliveries against sales and securities lent to other Broker Dealers. Said record shall state the borrowing or lending date, name of borrowing or lending Broker Dealer, number of shares, name of security, price, amount, the date returned, and any interest or other compensation. As securities are marked to market, resulting in additional monies paid or collected, the record should reflect that money movement in order to balance the daily cash blotter and reflect the appropriate money amount to be paid or collected when the loan is paid.
Record of Monies Borrowed, Monies Loaned, etc.
A Broker Dealer shall have a record of all borrowings, regardless of whether customers’ or its securities are pledged as collateral. This record should show the name of the bank, the date of payment, and particulars of the collateral, if any.
Record of Securities and Monies Failed to Receive or Failed to Deliver
A Broker Dealer shall have a record of securities and monies, which the Broker Dealer failed to receive or deliver. In case of failure to receive securities and monies, the Broker Dealer shall state in said record the date on which delivery was due but not made, number of securities or amount of money, name of security, purchase price, Broker Dealer from whom delivery is due, and date received. In case of failure to deliver securities and monies, the Broker Dealer shall state in such record the date on which delivery was due, number of shares or amount of money, name of security, Broker Dealer to whom securities were sold, sale price and date on which delivery is made.
Securities Record or Ledger
A Broker Dealer shall have securities record or ledger or position book, which shall state separately for each security all long or short positions (including securities in safekeeping) carried by the Broker Dealer either for its account or for the account of its customers. Said record or ledger shall state the location of all securities “long”, the offsetting position to all securities “short”, and in all cases the name or designation of the account in which each position is carried.
A Broker Dealer shall have a memorandum of each order and any other instruction, which the Broker Dealer, on its behalf or on behalf of its customer, gave or received for the purchase or sale of securities, whether executed or unexecuted. The memorandum shall state the terms and conditions of the order or instructions and of any modification or cancellation thereof, the account for which entered, the time of entry (i.e., the time the order was transmitted by the Broker Dealer and received by the relevant party), the price at which executed, and, to the extent feasible, the time of execution or cancellation. Orders entered pursuant to the exercise of discretionary power by the Broker Dealer shall be so designated. A Broker Dealer may adopt an electronic form for the order ticket with the approval of the SEC.
Confirmations and Notices
A Broker Dealer shall have copies (Broker’s copies and copies acknowledged by customers) of (i) confirmations of all purchases and sales of securities and (ii) copies of notifications of all other debits and credits for cash and/or securities for the account of customers.
Records on Cash and Margin Accounts
A Broker Dealer shall have, in respect of each cash and margin account, a record containing the name and address of the beneficial owner of the account, and, in the case of a margin account, the signature of the owner.
Monthly Trial Balances and RBCA Computation
A Broker Dealer shall prepare at least once a month a current record of (a) the proof of money balances in all ledger accounts in the form of trial balances; and (b) the computations of the aggregate indebtedness, net liquid capital and RBCA ratio as of the trial balance date; Provided, however, that the computation of the aggregate indebtedness net capital and RHCA ratio shall be made on a daily basis and available for review when required by the Commission or the Exchange.
Written supervisory procedures
A Broker Dealer shall have on file its written supervisory procedures (WSP) detailing the operating procedures established by the Broker Dealer and other internal procedures adopted in compliance with the requirements and provisions of the SRC, the 2015 SRC Rules and other relevant regulations.
File of AMLA Resolutions
A Broker Dealer shall have on file all Anti-Money Laundering Act (AMLA) Resolutions and such file shall be updated with any new AMLA resolutions released by the Anti-Money Laundering Council.