Prudential On-site Inspections of Financial Services Intermediaries

The FSC also carried out 3 prudential on-site inspections at the premises of its licensees. These inspections related to domestic companies in the following business activities:  -

• Leasing;
• Full service dealer (including underwriting) and full service dealer (excluding underwriting); and
• Investment adviser – in the categories of unrestricted.

The objectives of the inspections were to ascertain that these entities are operating under the scope of the licences granted to them and their compliance with the requirements of the relevant laws.  They were further assessed on different parameters such as corporate governance, market conduct, prudential aspects including fairness and transparency. Adherence to money laundering legislations and codes as well as evaluation of financial soundness and controls (risk management, systems/mechanisms) were also part of the assessment parameters.  

With regards to operational matters, the licensees were queried on their business culture, complexities encountered, future strategies/plans and adherence to the Code of Business Conduct. Inspectors also conducted an analysis of the Books of accounts. As far as reporting is concerned, the inspectors also check the Auditors report for an independent and neutral assessment of the state of affairs of the entities.