16. RECORD KEEPING AND INTERNAL AUDIT
16.1. Record keeping requirements
An Authorised Firm must, for a minimum of six years, maintain sufficient records in relation to each activity and function of the Authorised Firm. These must include, where applicable, the records kept in accordance with the rules in COB as summarised in the table in COB 16.2.
16.2. Table summarising record keeping requirements
COB reference | Nature of record | Length of record keeping requirement | Date from which record must be kept |
Record of Client classification | Six years | Date on which the business relationship with a Client ended | |
Financial Promotion issued by, or on behalf of, the Authorised Firm | Six years | Date on which the Financial Promotion ceases to be made | |
A record of each Client Agreement including any subsequent amendments to it as agreed with the Client | Six years | From the date the Client ceases to be a Client of the Authorised Firm | |
Suitability report | Six years | From the date the Client ceases to be a Client of the Authorised Firm | |
Records of orders and transactions | Six years | From date of order or transaction | |
Record of inducements disclosed | Six years | From the date on which the inducement was disclosed | |
Record of Client Money received in the form of cheque, or other payable order | Six years | From date of receipt | |
Records which enable an Authorised Firm to determine promptly the total amount of Client Money that it holds for each of its Clients | Six years | From the date the Client ceases to be a Client of the Authorised Firm | |
Records in respect of Client Investments | Six years | From the date the Client ceases to be a Client of the Authorised Firm | |
A copy of each confirmation note sent to a Client | Six years | From the date of despatch | |
A copy of any periodic statement provided to a Client | Six years | From the date on which it was provided | |
A copy of any agreement entered into between an insurer and that Insurance Intermediary acting as agent | Six years | From the date on which that agreement is terminated | |
Records of all sums withdrawn from the Insurance Bank Account | Six years | From the date of withdrawal or realisation | |
Record of all Complaints made against the Authorised Firm for a minimum period of six years | Six years | From the date of receipt of a Complaint |
16.3. Internal Audit of Client Statements
At least annually, a sample of Client statements provided by an Authorised Firm under any of COB 8.2.19, 8.3.14, 9.2 or 8.5.16 must be reviewed by the internal audit function of the Authorised Firm established under GEN 5.5. The sample must be significant and stratified.
Guidance: Significant and Stratified Sample
A sample will be considered “significant” if it includes ≥5% of the total number of Client statements provided during the review period. A sample will be considered “stratified” if it is drawn proportionately from a range of different Client types based on appropriate factors in light of the business of the Authorised Firm, which may include, for example: status (Retail Clients versus Professional Clients), business type, assets, income, geography and types of products held with the Authorised Firm. The results of the internal audit review must be made available to the AFSA upon request.