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    • Application Forms and Notices Module (AFN)

      • Application Forms and Notices Module (AFN) [VER46/02-19]

        Please click herehere to view the PDF.

        • Chapter 1 — Chapter 1 — AFN Introduction

          • AFN 1.1 AFN 1.1 Application

            • AFN 1.1 Guidance

              This Sourcebook is relevant to a Person to whom GEN, CIR, AMI, COB, REC, MKT or AML applies.
              [Amended][VER23/04-11]
              [Amended][VER24/10-11]
              [Amended][VER27/07-12]
              [Amended][VER28/07-13]

          • AFN 1.2 AFN 1.2 Defined terms

            • AFN 1.2 Guidance

              Defined terms are identified throughout the forms by the capitalisation of the initial letter of a word or each word of a phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook. Unless the context otherwise requires, where capitalisation of the initial letter is not used, an expression has its natural meaning.

        • Chapter 2 — Chapter 2 — AFN AUT Forms

          • AFN AUT–NOTES AFN AUT–NOTES Applying for Authorisation — Notes for Applicants

            Click here to download the notes in PDF FormatPDF Format.

            These notes provide information that may assist you in completing the Core Information form, the various Fund forms, the Representative Office form, the Credit Rating Agency form, any applicable supplements and key documents required. Each note is linked to a specific question in the relevant form or supplement via a referenced number.

            Firms are requested to contact the supervision department of the DFSA (switchboard +971 (0)4 362 1500 or info@dfsa.ae) before considering an application

            • The purpose of the Core information form, Fund Forms and supplements

              The appropriate forms and supplements must be submitted if you wish to carry on one or more Financial Services in or from the DIFC. Financial Services are defined in the GEN module of the DFSA Rulebook. The GEN module (chapter 2) outlines which business activities fall within the definition of Financial Services, and enables you to check whether there are any exemptions or prohibitions which may be relevant to your application.

              The GEN module (chapter 7) also sets out the DFSA's authorisation requirements. You can find a copy of the GEN Module of the DFSA Rulebook on the DFSA website at www.dfsa.ae. The DFSA website also provides information on the authorisation process.

              The forms and supplements are designed to assist you to provide us with information about the Financial Services for which you are seeking a Licence and to help us understand how you intend to carry on those activities. You will need to satisfy the DFSA that you have sufficient financial resources, appropriate personnel, adequate systems and internal controls to carry out the Financial Services you propose. Each person seeking status as an Authorised Individual should complete the AUT-IND 1 forms.

              The DFSA may ask for additional information or clarification to complete the consideration of an application. We will correspond with the contact person listed on the form.

              An Authorised Firm wishing to vary its current Licence should complete Form SUP 4 and any applicable supplements.

              Which forms / supplements do you complete?

              You may be required to complete more than one form and supplement depending upon the nature of the Financial Services you want to carry out. The table below sets out the Financial Services covered by each form / supplement:

              Form / Supplement Financial Services
              Core Information form Complete this form if you are applying for a Licence to carry on one or more Financial Services, as defined in the GEN module of the DFSA Rulebook.

              If you are applying to Manage a Collective Investment Fund (in relation to an Exempt Fund or QIF), please use the Exempt Fund form or QIF Domestic Fund Manager Form.

              If you are applying to Operate a Representative Office, please use the Representative Office form.

              If you are applying solely to Operate a Credit Rating Agency, please use the Credit Rating Agency form.
              Representative Office form Complete this form if you are applying to carry out the Financial Service of Operating a Representative Office. You do not have to submit the Core Information form or any supplement.
              Credit Rating Agency form Complete this form if you are applying to carry out only the Financial Service of Operating a Credit Rating Agency. You do not have to submit the Core Information form or any supplement.

              Do not complete this form if you are applying to conduct any other Financial Service in addition to Operating a Credit Rating Agency. In this case, you must complete the AUT CORE form and any supplement which relates to the other Financial Service(s).
              Asset management Supplement Complete this supplement if you are applying to carry out business activities related to asset management.

              Financial Services covered in this supplement are:
              •   Managing Assets
              •   Arranging Credit or Deals in Investments
              •   Advising on Financial Products or Credit
              •   Dealing in Investments as Agent
              •   Arranging Custody
              •   Providing Custody
              Please note that you should also submit the Core Information form and any other appropriate supplements.
              Banking and lending Supplement Complete this supplement if you are applying to carry on the following Financial Services:
              •   Accepting Deposits
              •   Providing Credit
              Please note that you should also submit the Core Information form and any other appropriate supplements.
              Sales and trading Supplement Complete this supplement if you are carrying out business activities similar to that of a marketing firm, stock broker, advisory firm or investment bank.

              Financial Services covered in this supplement are:
              •   Dealing in Investments as Principal
              •   Dealing in Investments as Agent
              •   Advising on Financial Products or Credit
              •   Arranging Credit or Deals in Investments
              •   Arranging Custody
              •   Providing Custody
              Please note that you should also submit the Core Information form and any other appropriate supplements.
              Islamic Finance Business Supplement Complete this supplement if you are applying to carry on Islamic Financial Business, which is defined in the GLO module of the DFSA Rulebook.

              Please note that you should also submit the Core Information form or Exempt Fund form and any other appropriate supplements.
              Insurance Supplement Complete this form if you are applying to carry on the following Financial Services:
              •   Effecting Contracts of Insurance
              •   Carrying out Contracts of Insurance
              •   Insurance Intermediation
              •   Insurance Management
              Please note that you should also submit the Core Information form and any other appropriate supplements.
              Public Fund Supplement Complete this form if you are applying to Manage a Collective Investment Fund (in relation to a Public Fund only). This is a multipurpose supplement to be used by a Domestic Fund Manager managing a Domestic and/or External Fund. Additionally it can be used by an External Fund Manager looking to manage a Domestic Fund.

              Please note that you should also submit the Core Information form and any other appropriate supplements.
              Miscellaneous Financial Services (no supplement required for these Financial Services) You do not have to complete a supplement if you are applying to carry on the following Financial Services:
              •   Providing Fund Administration
              •   Providing Trust Services
              •   Acting as the Trustee of a Fund
              •   Operating a Representative Office
              •   Operating a Credit Rating Agency
              Complete only the Core Information form and submit your regulatory business plan. Please refer to the 'Miscellaneous Financial Services' section contained in Part 2 of these notes to understand the type of information required in your regulatory business plan.

              If you are carrying on any other Financial Services the appropriate supplement must also be submitted.
              Exempt Fund form Complete this form if you are applying to carry out the Financial Services of Managing a Collective Investment Fund (in relation to an Exempt Fund only). This is a multipurpose form to be used by a Domestic Fund Manager managing a Domestic and/or External Fund. Additionally it can be used by an External Fund Manager looking to manage a Domestic Fund. You do not have to submit the Core Information form. If you require an Islamic Endorsement you should complete the Islamic Finance business.
              Qualified Investor Fund: Domestic Fund Manager Form This form must be submitted by applicants applying to conduct the Financial Service of:

              •   Managing a Collective Investment Fund which is a Qualified Investor Fund, and
              •   Advising on financial products or credit (in relation to QIFs only being managed by the applicant)

              If this is the only activity that the applicant firm intends to undertake then you are not required to submit the Core Information Form ("AUT-CORE").

              However, if you wish to carry on any other Financial Services activities then please submit the Form AUT-CORE in addition to this form. If this is the case then please only provide responses to Questions 1, 2, 21, 22, 23, 24 and 25.
              Qualified Investor Fund: Fund Notification Form Complete this form if you are seeking to notify the DFSA that you are establishing a Qualified Investor Fund in the DIFC.
              External Fund Manager Form Complete this form if you are seeking to establish a presence as an External Fund Manager based in a reputable jurisidiction seeking to establish and manage a Fund in the DIFC. It can do so without having to obtain a DFSA Licence. External Fund Managers can manage funds in the DIFC ranging from Public Funds, Exempt Funds and Qualified Investor Funds.
              External Fund: Notification Form Complete this form if you are a Fund Manager which is an Authorised Firm in the DIFC which is seeking to establish a Fund in a jurisdiction other than the DIFC.

              Notes for completing the forms and supplements

              •   The term "you" refers to the entity for which a Licence is being sought to conduct Financial Services in or from the DIFC. In all instances where a form or supplement requests details to be supplied in relation to you, responses should be provided in relation to the entity wanting to establish within the DIFC.
              •   Defined terms are identified throughout the forms and supplements by the capitalisation of the initial letter of each word. These terms are defined in the Glossary module (GLO) of the DFSA's Rulebook.
              •   All financial information must be given in US Dollars, with a statement of the original currency used (if relevant) and the exchange rate applied for conversion.
              •   Questions must be answered fully and the use of abbreviations or acronyms should be avoided. Any abbreviations or acronyms used should be clearly defined.
              •   Do not leave any questions blank. If a question is not applicable this should be indicated in the response section. Failure to answer questions or provide full responses may delay the progress of the application.
              •   The forms must be completed in English. Any accompanying documentation must also be in English or accompanied by a certified translation.
              •   Before completing the forms and supplements, we urge you to read the GEN module (chapter 7) of the DFSA Rulebook to ensure you provide appropriate information. You are urged to familiarise yourself with other relevant Rules prior to completing the forms.
              •   You may find it useful to refer to the relevant leaflets under the DFSA Library / DFSA Publications on the DFSA website at www.dfsa.ae.
              •   Answers must be typed in electronic format and the Core Information form / Exempt Fund form must be signed by a Director/Partner. If the firm still has to be incorporated, the Director who will be authorised in due course should sign.
              •   The version of the forms and supplements on the DFSA's website are in PDF format. If you would like Microsoft Word versions, please contact our Authorisation Enquiries team. Please provide one hard copy and one soft copy of your application. The soft copy should be stored on CD or memory stick. Please do not send e-mail copies.
              [Amended][VER23/04-11]
              [Amended][VER6/08-14]

            • AFN AUT-NOTES Part 1: Core Information form notes

              Click here to download the notes in PDF FormatPDF Format.

              This section contains information that may assist you in completing the Core Information form. Each note below relates to a question or statement in the Core Information form. Eg CF6 provides information to help you to complete the matrix at CF6 of the Core Information form.

              Section 1

              General information

              CF1. -
              CF2. We want information about the legal nature of your firm. Please refer to GEN Rule 7.2.27.2.3.
              CF3. There are generally two high-level categories of firms applying to be Authorised Firms: DIFC entities and non-DIFC entities (or Branches).

              DIFC entities are firms that have been created under DIFC legislation, such as DIFC Company Law or DIFC General Partnership Law.

              Non-DIFC entities are firms that have been created outside of the DIFC under the laws of another jurisdiction, but who want to establish a place of business in the DIFC. Such firms are commonly referred to as Branch offices. Note that legally, the Branch is not a separate legal person to the firm.
              CF4. Start-up entities are either new Financial Services businesses or existing Financial Services businesses which have not been subject to Financial Services regulation. Please refer to the section 2-5 of the RPP Sourcebook module.
              Please note the DFSA does not accept applications for start-up banks.
              CF5. Give the name of the supervisory contact person from the relevant regulator including postal address, telephone number, fax number and e-mail address.
              CF6. Please refer to the GEN module for further details about Financial Services and Investment types. Please refer to GEN APP 4 for details about classes of insurance.
              CF7. Please refer to GLO for the definition of Islamic Financial Business.
              CF8. If you wish any of the DFSA Rules waived or modified (for example, in respect of certain of the prudential requirements for a branch application) you must submit the Form SUP 2.
              CF9. Please refer to COB chapter 2 for Client classification.
              CF10. If the company is going to be formed in the DIFC, please answer 'in formation'.
              CF11. Your financial year-end will be used to determine the regulatory reporting requirements.
              CF12. You will need to give details of any trading name(s) which you propose to use for the purpose of, or in connection with, any business carried out in or from the DIFC, if these are different from your legal name.
              CF13. If you answered "yes", please detail whether you are reliant on IT systems for programmed trades and / or proprietary trading, that the firm has created/implemented and the degree of complexity involved. Indicate whether the firm's IT systems automatically interface with Clients and/or third parties such as traders.
              Please note that you should answer "no" if a firm may be merely reliant on standard off the shelf products (e.g. Microsoft Office) which the majority of businesses use in their day-to-day activities.

              Controllers

              CF14. Please refer to GEN Rule 11.8.3 for the definition of Controller.

              Contact details

              CF15. The contact person named should be the person who is responsible for the application during the authorisation process and who will liaise with the DFSA. This person must be a representative of the company. It may be helpful to provide a second contact name as back-up.
              CF16. If you do not have an adviser assisting you with this application please go to question CF18.
              CF17. You may have a professional adviser assisting with the application process. Please tick "yes" if the DFSA should copy correspondence in relation to this application to the adviser.
              CF18. You need to give the full address of the registered and current / proposed place of business in the DIFC or Dubai. It is expected that prior to submitting this application you will have already approached the Dubai International Financial Centre Authority (DIFCA) in relation to securing premises.
              CF19. Whether you are a DIFC or non-DIFC entity please provide your head office address.
              CF20. -
              CF21. You will need to state the name of your auditor, their address, the relevant contact person, telephone number and fax number.
              For Domestic Firms the auditor must be an auditor registered with the DFSA in accordance with GEN Chapter 8.

              Documentation

              This section is a check list of all the documents you may need to submit to support your application. Please also see the section entitled Compulsory supporting documents.
              CF22. Regulatory business plan

              Please refer to 'Part 2: Notes on what the DFSA expect to see in a regulatory business plan'.
              CF23. -
              CF24. -
              CF25. -
              CF26. -
              CF27. AUT-IND 1 forms

              You must fill in an AUT-IND1 form for each individual who will be performing a Licensed Function.
              An Authorised Individual is a person who is approved by the DFSA to perform a Licensed Function for an Authorised Firm. Licensed Functions are defined in GEN Section 7.4. A person may perform more than one Licensed Function. However we do not expect to see the same individual carrying out both business and control responsibilities for example Senior Executive Officer and Compliance Officer roles.
              CF28. Audited accounts

              Your most recent audited accounts including the balance sheet, P&L and cash flow statement. (Where audited accounts are unavailable please supply interim unaudited accounts or management accounts.)
              CF29. Audited group accounts (if applicable)

              The Group's most recent audited accounts including the balance sheet, P&L and cash flow statement. (Where audited accounts are unavailable please supply interim unaudited accounts or management accounts.)
              CF30. Financial projections

              Please attach the following financial projections and assumptions commencing at the time of authorisation and on a quarterly basis for each of the first three financial years after licensing:
              •   Balance sheet (if applicable)*
              •   Profit and loss account, split into income streams; and
              •   Cash flow statement (if applicable)*
              Please provide the figures in the DFSA reporting return format relevant to the proposed Category of the applicant firm. A list of the key assumptions supporting these financial projections must also be submitted.

              *These items may not be applicable in the case of a Branch

              The financial projections requested here are generic in nature. Other forms may request additional information according to the Financial Services to be conducted eg Insurance Business.

              Using the figures provided in your projections please attach a calculation showing your Capital Resources versus your Capital Requirement at the time of authorisation and quarterly for three financial years.

              Note:
              •   For Accepting Deposits, Providing Credit, Insurance Intermediation and Investment Business the Capital Requirement is the highest of the amounts outlined in PIB 2.3. The Capital Resources calculation should be performed in line with PIB 2.6 and the provisions in PIB sections 2.7 - PIB 2.10, and PIB chapters 4 and 5 as applicable.
              •   For Insurance Business the Adjusted Capital Resources, Adjusted Cellular Capital Resources and Adjusted Non Cellular Capital Resources calculation should be performed in line with PIN sections 4.3 and 4.4 as applicable
              •   For Insurers conducting Insurance Business as a Protected Cell Company an applicant will be required to demonstrate that it has adequate Capital Resources, Cellular Capital Resources, Adjusted Cellular Capital Resource or Adjusted Non Cellular Capital Resources (as applicable) to meet the Minimum Capital Requirement for the business it proposes to undertake.
              Financial reporting and returns

              For Accepting Deposits, Providing Credit, Insurance Intermediation and Investment Business:
              •  The prudential Rules are contained in the PIB module of the DFSA Rulebook
              •   Chapter 1 of the PIB module provides the Rules in respect of the preparation and submission of returns
              •   The relevant returns can be found in the PRU-EPRS Sourcebook, including instructional guidelines as to their use
              •   Editable electronic versions of the return forms can be obtained from the DFSA
              For Insurance Business:
              •   The prudential Rules are contained in the PIN module of the DFSA Rulebook
              •   Chapter 6 of PIN module provides the Rules in respect of the preparation and submission of returns
              •   The relevant returns can be found in the PRU-EPRS Sourcebook, including instructional guidelines as to their use
              •   Editable electronic versions of the return forms can be obtained from the DFSA
              ISAE 3400 – The Examination of Prospective Financial Information

              If you are applying as a DIFC entity, to be a prudential Category 1 or 2 firm or an Insurer, you are required to submit to the DFSA a copy of the ISAE 3400 Examination of Prospective Financial Information report completed by the applicant's auditor. This is a standard implemented by IFAC (International Federation of Accountants). Under this report the auditor is required to obtain sufficient evidence to ascertain whether
              •   Assumptions on which the prospective financial information is based are not unreasonable
              •   Prospective financial information is properly prepared on the basis of the assumptions
              •   The prospective financial information is properly presented and all material assumptions disclosed and a clear indication as to whether the assumptions are best estimate or hypothetical
              •   Prospective financial information is prepared on a consistent basis with historical financial statements
              CF31. Evidence of source of funds for start-up

              Provide supporting evidence of the original source of funds which will be used to provide your initial Capital Resources. We usually require details of how the money sourced for the start-up entity has been generated. Please provide a bank reference. You may be asked for a declaration that the funds are not from the proceeds of crime.

              Compulsory supporting documents

              The documents required in this section can be self-certified by all firms except start-up firms who will need to supply all the documentation as part of the application. You should be aware that you may still be asked to supply all or any of the documents as part of the application.
              CF32. Compliance manual

              This is a critical document which will impact the decision whether the firm should be authorised. The DFSA prefers that the compliance procedures are incorporated in one manual. Once you receive authorisation, our Supervision team will visit and ask to see the manual. The manual should include the points mentioned below. Please note this is not an exhaustive list.
              •   the structural oversight and reporting arrangements that will ensure you continually meet your compliance obligations under applicable legislation in the DIFC;
              •   how compliance reports are prepared, authorised, disseminated and followed up;
              •   policies and procedures, systems and controls, and customer documentation should cover areas such as client classification, marketing material, suitability, disclosure of fees and commissions, inducements, and segregation of Client Assets;
              •   how compliance breaches are detected, recorded, categorised and rectified;
              •   how the DFSA and other Financial Services Regulators, if applicable, will be kept appraised of all relevant breaches;
              •   how you will keep yourself updated on any changes to applicable legislation in the DIFC and DFSA Rules;
              •   the arrangements for handling, resolving and recording complaints, with particular reference to the requirements of GEN chapter 9 (Complaints Handling and Dispute Resolution);
              •   how you will embed a positive mind-set towards compliance issues in all your employees, not just your compliance staff;
              •   how you will ensure compliance by any Person under a material outsourcing or delegation arrangement with relevant requirements and procedures;
              •   how you will determine and maintain records of your Client verification;
              •   how you will ensure training and competence are embedded into the culture of your firm;
              •   who will be responsible for reviewing the compliance plan, how often the plan will be reviewed and what process will be followed;
              •   how you will ensure compliance with financial reporting and regulatory Capital Requirements;
              •   does the firm have a conflicts management policy? Describe how senior management and the board will identify and manage conflicts of interest between different clients, and between the firm and clients. We want to know how you plan to manage conflicts that may arise in the course of your business.
              •   describe your employee code of conduct and how you deal with Employee Personal Account Transactions. Please see COB section 6.2;
              If you want to carry on a Financial Service with or for a Retail Client, you must apply for and obtain a Licence endorsement ("Retail Endorsement"). An application for a Retail Endorsement can be made to the DFSA by an existing Authorised Firm or a new applicant. We will grant a Retail Endorsement only if we are satisfied that you can provide Financial Services to Retail Clients in accordance with all the regulatory requirements applicable to the relevant Financial Service.

              You should also be able to demonstrate that your systems and controls (including policies and procedures) adequately provide for compliance with the requirements specifically dealing with Retail Clients, in particular:
              •   marketing materials intended for Retail Clients;
              •   content requirements for Client Agreements for Retail Clients;
              •   suitability assessment for recommending a financial product for a Retail Client;
              •   disclosure of fees and commissions and any inducements, to a Retail Client;
              •   segregation of Client Money and/or Client Investments, where relevant.
              Your systems and controls must be adequate to ensure on an ongoing basis, that your employees remain competent and capable to perform the functions which are assigned to them, including any additional factors that may be relevant if their functions involve interfacing with Retail Clients.

              The adequacy of your Complaints handling policies and procedures will also be reviewed. You must have Complaints handling policies and procedures that meet the requirements in GEN chapter 9.

              Your policies and procedures must provide for fair, consistent and prompt handling of Complaints. In addition to the matters set out in GEN chapter 9, the policies and procedures should explicitly deal with how you ensure that:
              •   employees dealing with Complaints have adequate training and competencies to handle Complaints, appropriate impartiality and sufficient authority (see GEN Rules 5.3.19, 9.2.7 and 9.2.8);
              •   a Retail Client is made aware of the firm's Complaints handling policies and procedures before obtaining its services (see COB Rule A2.1.2(1)(h)); and
              •   your firm's Complaints handling policies and procedures are freely available to any Retail Client upon request.
              CF33. Anti-money laundering procedures
              Your anti-money laundering procedures should include, amongst other things, arrangements to:
              •   Ensure compliance with UAE Law No 4 and any other relevant UAE federal laws. The only exception is if another jurisdiction's laws or regulations prevent or inhibit you from complying with UAE Law No 4 or the DFSA Rules; in which case you should tell us. Also note that should such an event arise after you are authorised, you are obliged to notify us promptly in writing;
              •   Ensure compliance with relevant resolutions or sanctions issued by the United Nations Security Council. Please refer to GEN Rule 5.3.29;
              •   Monitor for, detect and report suspicious customers and transactions. You should ensure your procedures comply with the requirement for Suspicious Transaction Reports (STRs), to be made in the required format to the Anti-Money Laundering Suspicious Cases Unit (AMLSCU), with a copy provided to the DFSA. Details of the required format of the report and details for submission can be found on the DFSA website;
              •   Establish and verify the identity of the customer and any other person on whose behalf the customer is acting, including that of the beneficial owner. Details will need to be provided if you intend to delegate any aspect of the customer identification process to a qualified professional or the Unitholder verification process to a Fund Administrator;
              •   Establish and verify your business partners' identities, including correspondent banks;
              •   Provide an audit trail of transactions;
              •   Determine the duties and obligations of your Money Laundering Reporting Officer (MLRO);
              •   Review the effectiveness of your Anti-Money Laundering policies, procedures, systems and controls at minimum on an annual basis;
              •   Respond to any request for information made by UAE authorities or the DFSA. You will need to state where customer or Unitholder identification records will be kept and, if these are outside of the UAE, whether there is any secrecy or data protection legislation that would restrict access by you, the DFSA or the law enforcement agencies of the UAE. If this is the case, you will need to provide details of the arrangements that it will be put in place to ensure copies of these records are kept in a jurisdiction which allows access;
              •   Maintain AML relevant documents and records;
              •   Ensure that you obtain and make use of findings in relation to names of persons, groups, organisations or entities, or any other body where suspicion of money laundering or terrorist financing exists;
              •   Assess your risks in relation to money laundering and perform enhanced due diligence investigations for higher risk products, services and customers;
              •   Determine whether a customer is a Politically Exposed Person (PEP) and address the associated risks accordingly;
              •   Establish and maintain anti-money laundering training programmes and awareness sessions. This should include a description of the arrangements in place to ensure you obtain and use any government, regulatory and international findings;
              •   Ensure compliance with any other obligation in the DFSA's AML module. You must have arrangements in place to provide appropriate Anti-Money Laundering training (including the internal reporting duties and Client identification duties) to your employees. Please provide full details of what training you will provide for all your relevant employees and whether the MLRO will be in charge of this training. If the MLRO will not be in charge, then give the full name and job title of the person who will be;
              •   If you will be Providing Fund Administration, ensure such procedures are also relevant with respect to Unitholders of a Fund;
              •   If you will be Providing Trust Services, ensure such procedures include due diligence for settlors, trustees and principal names beneficiaries in accordance with COB section 5.10.
              •   You will need to provide the details of the Deputy Money Laundering Reporting Officer, including surname/family name and given name.
              •   You will need to state whether your Anti Money Laundering function will be subject to oversight, review or audit by either your Parent's Anti Money Laundering function, internal audit or another internal function or external organisation. If so, you will need to specify the arrangements including the nature of the oversight, review or audit and the scope and frequency with which it will be undertaken.
              •   AML Rule 3.4.1 requires a firm to take reasonable steps to verify the identity of its customers. Please detail the policies, procedures, systems and controls that you will put in place to ensure that sufficient evidence of the identity of all your Clients (or a Fund's Unitholders, if relevant) will be obtained.
              •   Detail the procedures or systems that you will put in place to ensure that "Know Your Customer" (KYC) or Unitholder information is made available to your relevant employees. In addition, are there any systems that will be set up to obtain further information;
              •   Detail the proposed disciplinary steps that you will put in place for any employee who fails to report promptly to the MLRO any suspicion or beliefs that money laundering is occurring as required in AML section 3.5;
              •   Describe the record keeping arrangements you will put in place for records, as specified in the AML module of the DFSA Rulebook.
              CF34. Compliance monitoring programme

              Your programme should document how compliance is monitored within the business units.
              CF35. Risk management policies

              Your policy document should describe the risk management arrangements you will establish and maintain to identify, assess, mitigate, control and monitor the risks arising from the Financial Services activities carried on in or from the DIFC. Such arrangements should also take into account any Funds for which you are acting as the Manager.
              Include the following: the nature, scope and organisational structure of your risk management functions; the reporting lines and nature, scope and frequency of risk reporting, including the composition and terms of reference of any risk committees and any appropriate links to Group risk reporting.

              Fees

              The application fee will vary according to the Financial Services to be carried on. Comprehensive details of fees can be found in the Fees module of the DFSA Rulebook.

              Section 2 - Regulatory business plan

              Please refer to 'Part 2: Notes on what the DFSA expect to see in a regulatory business plan'.

              Section 3 – Prudential regulatory reporting

              CF36. To determine the prudential Category relevant to you, please refer to PIB section 1.3. If you are conducting the Financial Services of Effecting Contracts of Insurance and/or Carrying out Contracts of Insurance, please answer "Insurer".
              CF37. Refer to GEN section 8.2 to determine the accounting standards to be used in preparing your financial accounts and statements. The expected standard is International Financial Reporting Standards (IFRS) / Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI). If you are using a different standard you will need to apply for a waiver.
              CF38. -

              Section 4 – Fit and Proper questionnaire & Declaration

              CF39-45. These questions are self-explanatory and are focused on the fitness and propriety of the firm. If you answer yes to any question please supply all relevant information - openness and honesty are essential. Should we need to examine your application more closely because of any disclosures you make, this will not necessarily count against you. However, deliberately withholding information or providing false or misleading information, will adversely impact the success of your application. If in doubt, disclose.
              [Amended][VER23/04-11]
              [Amended][VER6/08-14]

            • AFN AUT-NOTES Part 2: Notes on what the DFSA expect to see in a regulatory business plan

              Click here to download the notes in PDF FormatPDF Format.

              The regulatory business plan should set out the strategy and rationale for establishing an operation in the DIFC and also demonstrate how the business will be managed and controlled. We recommend you attach the regulatory business plan as a separate document, which should be no longer than 50 pages, depending on the nature and complexity of the business.

              We need to understand the business model of your firm so we can ensure it is authorised for the correct Financial Services, Investment types and Client types and to enable us to assess the adequacy of your resources.

              You will need to:
              •   identify all the Financial Services and any other activities you intend to carry on;
              •   identify all the likely business and regulatory risk factors;
              •   explain at high level how you will monitor and control these risks; and
              •   take into account any intended future developments.
              Please remember that your description of your business is an important part of the overall application and integral to our decision making. The amount of detail submitted should be proportionate to the nature of the business you intend to carry on, and should be appropriate to the risks to your Clients.

              Introduction and background

              This is an opportunity to provide a very brief introduction/history of the firm, including what experience, if any, you have in carrying on the proposed business in Dubai or other jurisdictions.

              Strategy and rationale for establishing in the DIFC

              BP1. Business activities
              Describe your proposed activities in terms of the permitted Financial Services defined in the GEN module of the DFSA Rulebook and the type of products and/or services you propose to offer, together with a rationale for these conclusions. Please document how each Financial Service listed below will relate to your day-to-day business activities.
              •   Accepting Deposits;
              •   Providing Credit;
              •   Dealing in Investments as Principal;
              •   Dealing in Investments as Agent;
              •   Arranging Credit or Deals in Investments;
              •   Managing Assets;
              •   Advising on Financial Products or Credit;
              •   Managing a Collective Investment Fund;
              •   Providing Custody;
              •   Arranging Custody;
              •   Effecting Contracts of Insurance;
              •   Carrying out Contracts of Insurance;
              •   Insurance Intermediation;
              •   Insurance Management;
              •   Managing a Profit Sharing Investment Account;
              •   Operating an Alternative Trading System;
              •   Acting as the Trustee of a Fund;
              •   Providing Trust Services; and
              •   Providing Fund Administration.
              Please note that, if the applicant is a branch of a non-DIFC entity, it may only apply for financial service activities for which its head office has already been licensed by its home state regulator.
              BP2. Target markets (geographical areas)
              Which markets / regions you will target.
              BP3. Product(s)
              Describe your financial products / investments in detail.
              BP4. Clients
              Describe in detail the types of Clients that you intend to target, including the approximate size of the target Client base eg institutional, high net worth, Professional Clients, Retail Clients related / group company, geographical location, high net worth, professionals, retail etc. Please refer to COB chapter 2 for Client classification.

              We also expect you to identify existing and target clients, and to identify ultimate beneficial owners in relation to each client and each transaction that you are involved in. This would include understanding the beneficial ownership or having access to beneficial ownership information of holdings in any pooled investment vehicle that you manage.

              Detail should also be provided as to how you plan to source your clients eg by referral, marketing, advertising or transfer from within your Group. Where Clients will be transferred, please explain, in detail, the process, timescale and the due diligence that will be undertaken to ensure full compliance with the requirements of the COB and AML modules of the DFSA Rulebook.
              Document in detail how you plan to derive an income from your Clients eg premiums, commission, interest, etc.
              BP5. Competition
              Who do you see as your main competitors? How will you go about increasing your share of the market?

              Organisational structure

              BP6. Proposed legal entity structure
              In this section, we are seeking information on corporate structure and the proposed legal structure and where it fits into existing operations. We want to know the type of legal entity to be used and then whether this entity will be applying as a DIFC entity or non-DIFC entity.
              BP7. Relationship with group to include organogram and description of intra-group commercial activities
              Organogram of group structure identifying all Controllers, ultimate beneficial owners, other shareholders and Close Links. Include a clear breakdown of percentage shareholding sizes, jurisdiction in which the entity/individual is based, identification of any other regulated entities and each entity's principal activity. Where shares are held by a trust, you must also provide details of all trustees, settlors and beneficiaries.

              You should also provide narrative regarding intra-group transactions and business relationships eg guarantees, cash flows and their rationale.
              BP8. Other regulators of group
              Describe the extent to which overseas regulators supervise the group and whether they carry out supervision of the firm on a consolidated group basis.

              Management structure and organisation (corporate governance)

              BP9. Board: executive and non-executive members
              Describe the board composition - experience, non-executive directors and the frequency of board meetings. Brief biographies for each individual will be helpful.
              BP10. Senior management
              Provide brief biographies of the senior management team of the entity/group. Indicate the allocation of individual and where applicable, shared significant responsibilities among the senior management team; as well as the titles and role descriptions of the relevant senior managers to whom significant responsibilities are allocated. Also provide the basis on which you have assessed their ability and qualifications to discharge the allocated responsibilities.
              Please also provide details regarding your/group corporate governance structure in terms of how business decisions are made and controls implemented. This should include information concerning the management information flows within the firm; and how the governing body and other relevant corporate governance structures receive the information needed to run the business.
              BP11. Main committees (insight into decision making and how risk will be monitored)
              Describe any board committees and main committees which will make decisions, monitor and control risk. Describe the scope, remit, composition, responsibilities and reporting lines of each committee.
              BP12. Organogram of legal entity eg reporting lines to demonstrate separation of functions and independence of compliance/internal audit
              The employee organogram should identify the senior management / head functions with significant influence and any reporting lines to the Governing Body. Please ensure the CO and MLRO have access to both the Senior Executive Officer and board of Directors.

              Proposed resources (non-financial resources)

              BP13. Human resources: staffing and recruitment
              Describe your proposed staffing and overall headcount including details regarding where they are located locally, regionally and globally if applicable. Outline how you will supervise, train and monitor your employees to ensure they remain fit and proper, competent and capable of performing the functions to which they are assigned.
              BP14. Premises
              Where is the principal/proposed principal place of business? Is it fully operational? If not, when will you have fully operational premises? When will the contract on the premises run out?
              BP15. Outsourcing arrangements (if relevant)
              Provide details relating to any arrangements made with third parties / Service Provider in connection with the Financial Services you are carrying on, and explain fully how the activity will be operated. Points to consider are:
              •   the rationale for outsourcing/delegating;
              •   function/activity/Financial Service to be outsourced / delegated;
              •   whether this will be outsourced externally or to a Group entity and the name of the provider;
              •   why you have chosen this entity, any contingency plan, and how you will monitor and review the third party's performance;
              •   the arrangements for the selection and appointment of outsource providers and how control over the outsourced function(s) will be maintained;
              •   location of third party / Service Provider.

              High level controls

              BP16. Risk management including risk tolerance / approach and risk policies to include credit, market, liquidity, operational, underwriting and reserving.
              Identify the main external and internal risks for your business and how you intend to manage those risks. Document what policies will be in place (eg credit, market, liquidity, operational, underwriting and reserving) to mitigate these risks.
              BP17. Compliance (including AML/CTF policies)
              Describe the role of compliance and AML; the resourcing of the function(s) and its internal and external reporting line and how employees will be made aware of their regulatory obligations. Specify how senior management will ensure a culture of compliance is embedded in each of the business units, as well as the systems and controls that will be in place to monitor compliance. It is important that senior management and the board of a firm look to instil an appropriate culture for compliance and risk management throughout the firm. Document how you promote this eg through an appropriate remuneration policy, incentives for client retention, staff recruitment process (background checks), and management information.
              Describe the AML/CTF policies and procedures that you will have in place to prevent money laundering and terrorist financing. Document whether your compliance/MLRO functions will be subject to oversight, review or audit by a parent or Group compliance function, internal audit or another internal function or external organisation. Specify the arrangements including the nature of the oversight, review or audit and the scope and frequency with which it will be undertaken.
              BP18. Internal audit
              Provide details of the nature, scope, remit, organisational structure, reporting lines and staffing of the internal audit function. If your firm is part of a Group, you will also need to provide details of the relationship between your internal audit function and the internal audit function of the Group.

              Financial projections

              BP19. Assumptions and projections demonstrating adequate financial resources

              To reflect the financial projections requested in the Core Information form please document your approach to the assumptions made, capitalisation, liquidity, earnings and any associated risks. Please also describe what stress testing has been carried out in relation to expected revenues and costs. Please note assumptions and projections should cover 3 years of operation shown on a quarterly basis.

              Additional notes for certain Financial Services

              This section contains information that may assist you in completing the regulatory business plan if you are carrying on the following Financial Services:
              •   Providing Fund Administration
              •   Providing Trust Services
              •   Acting as the Trustee of a Fund
              You should cover each of the following points when producing your regulatory business plan. There are no supplements for these Financial Services. If you wish to conduct only these Financial Services, you are required to complete the Core Information form and regulatory business plan only.
              BP20. Providing Fund Administration
              Provide a description of the proposed activities you will carry on while conducting the Financial Service of Fund Administration to be provided in or from the DIFC with reference to the activities set out below and under GEN Rule 2.24:
              •   processing dealing instructions including subscriptions, redemptions, stock transfers and arranging settlements;
              •   valuation of assets and performing net asset value calculations;
              •   maintaining the share register and Unitholder registration detail;
              •   performing anti-money laundering requirements;
              •   undertaking transaction monitoring and reconciliation functions;
              •   performing administrative activities in relation to banking, cash management, treasury and foreign exchange; and
              •   producing financial statements; or communication with participants, the Fund, the Fund Manager, investment managers, custodian, trustee, prime brokers, regulators and any other parties in relation to the administration of the fund.
              A description of any other administrative functions or services proposed which are not captured by the above activities.

              A description of any circumstances where the Fund Administrator will not be appointed either by the Fund itself, or the Manager of the Fund. Details should be provided of any sub-delegation arrangements.

              A description of the arrangements for the maintenance of records in compliance with section CIR 5.1.6 - CIR 5.1.7.

              If your services involve holding cheques to the order of a Fund's bank account, or holding a mandate over a Fund's bank account, an outline of the circumstances and the controls that you will have in place to ensure compliance with CIR Rule 5.1.3 will need to be given.
              BP21. Providing Trust Services
              In conjunction with Part 2 of these notes your regulatory business plan should also describe the nature of the activities you will carry on while conducting the Financial Service of Providing Trust Services.

              Detail regarding the following activities as per GEN Rule 2.23.1:
              •   the provision of services with respect to the creation of an express trust;
              •   arranging for any Person to act as a trustee in respect to any express trust;
              •   acting as trustee in relation to an express trust;
              •   the provision of Trust Administration Services in relation to an express trust; or
              •   acting as a protector or enforcer in relation to an express trust.
              Please refer to GEN Rule 2.23.1 and COB chapter 5. Please note the activity of Providing Trust Services does not include the activity of Acting as the Trustee of a Fund, which is a separate Financial Service.

              How you will mitigate the potential for any money laundering risks inherent to the structures used by trusts / express trusts. Please refer to the AML module of the DFSA Rulebook.

              Whether you will be delegating any duties or powers and outline the circumstances and the controls that you will operate to ensure compliance with COB Rule 5.2.9.

              A description of the procedures that ensure regular reviews are conducted in accordance with COB Rule 5.3.1. A description of your arrangements to ensure compliance with the principle of dual control detailed at COB section 5.5. A description of your procedures for conducting due diligence on settlors, trustees and principal named beneficiaries in accordance with COB section
              BP22. Acting as the Trustee of a Fund
              You should provide the full name and business address of the Trustee. Indicate whether the Trustee is an Authorised Firm authorised to Act as the Trustee of a Fund; or an applicant to be an Authorised Firm.

              Confirm whether the Operator has entered or will enter into a Trust Deed with the Trustee in accordance with the requirements of Art 13 of the Investment Trust Law 2006 and other applicable requirements under the Collective Investment Law and CIR Rules.

              What resources you will have to carry out the duties of the Trustee as required under Part 5 of the Investment Trust Law 2006, and how you will ensure a Trustee has the requisite experience and independence.

              What measures you will take before carrying out an Operator's instructions to ensure that those measures comply with the requirements of CIR Rules 7.1.3 (1) and (2) (concerning the issue of Units). The arrangements you will implement to ensure the Fund's Unitholder register is maintained in accordance with CIR Rule 8.7 and the Investment Trust Law 2006.

              If you intend to delegate the Financial Service of Providing Fund Administration and Providing Custody and whether under CIR Rule 8.12.3 you have obtained consent from the Fund Manager. If so, please provide full details, including the name of the Service Provider(s) involved, details of whom it is regulated by, and a summary of the due diligence required under CIR Rule 8.12.4 and App 1.

              If you will you be carrying out the fund oversight function required under the CIR Rules in respect of the Fund, please describe what arrangements you will implement in order to ensure you are meeting your obligations under CIR Rules (concerning general oversight duties).
              [Amended][VER6/08-14]

            • AFN AUT-NOTES Part 3: AFN AUT-NOTES Part 3: Supplement notes

              • Asset management supplement notes

                Click here to download the notes in PDF FormatPDF Format.

                This section contains information that may assist you in completing the asset management supplement. Each note relates to a question in the asset management supplement e.g. AM3 below provides information that assists applicants to complete the question at AM3 of the asset management supplement.

                Section 1: Corporate governance, strategy and business model

                AM1. Confirm whether the funds / portfolios accounts to be managed will be individual Client funds; Domestic Funds, Foreign Funds, or pooled accounts. Document whether you will be managing Investments in an account or portfolio (whether on a discretionary basis or a non-discretionary basis under the terms of a non-discretionary management agreement). How will these accounts be structured?
                Provide details about the underlying assets to be invested in such as cash, equities, debt, property, derivatives, and, if applicable details of the products such as derivatives used only for hedging purpose.
                AM2. -
                AM3. Provide details of any role you have in the governance of portfolio(s) you manage as well as the role of the Fund Manager, investment committee and any other third parties. Outline the likely structure of your investment committee.

                Section 2: Financial and operational risks

                AM4. Provide details regarding the principal investors who will provide the seed capital of any portfolio you will manage.

                Section 3: Conduct of business risks to clients and markets

                AM5. Please refer to COB section 6.4 and COB Rules 6.8.36.8.6. Where a Client order is passed to another person for Execution, describe the procedures to be adopted to ensure Client orders are passed on in a timely fashion and are properly executed. Your answer should also address how you will manage any differences in work days and time between the DIFC and the jurisdiction in which that other person is located.
                AM6. Describe the procedures and controls to be adopted to ensure conversations relating to negotiating, agreeing, arranging and confirming Transactions and for the passing of payment instructions comply with the record keeping requirements in COB section 6.7 and APP 1.
                AM7. You can only market Foreign Funds that meet DFSA requirements. (Please see CIR chapter 15)
                AM8. Please see COB sections 6.11, 6.12, 6.13, APP5 and APP6.
                AM9. Please see COB section 3.5.
                AM10. -
                AM11. Please see COB section 3.4. Detail the extent to which considerations as to suitability will be limited and how such limitations (if any) will be communicated to and consented to by Professional Clients. Documentation of such assessment and record keeping should be addressed.
                AM12. Please provide details of the risks inherent to any portfolio(s) you will manage including diversification, currency, types of investments and the estimated proportion which will be represented by each type of investment. This should also be reflected in your risk management policy and procedures and be available for inspection if required.
                AM13. -
                AM14. Please see COB section 6.10.
                AM15. Please provide detail regarding the appropriate skills and experience of the person(s) in Client facing roles and responsible for the exercise of discretionary management decisions in relation to the management of these products. Please also refer to GEN Rule 5.3.18.

                [Amended][VER6/08-14]

              • Banking and lending supplement notes

                Click here to download the notes in PDF FormatPDF Format.

                This section contains information that may assist you in completing the banking and lending supplement. Each note relates to a question in the banking and lending supplement. Eg BL7 below provides information that assists applicants to complete the question at BL7 of the banking and lending supplement.

                Section 1: Corporate governance, strategy and business model

                BL1. Please provide detail of the intended nature of the Deposits which you would wish to attract. i.e. whether your proposed deposit base is intended to comprise of professional, commercial or interbank funding. Where the firm's proposed deposit base would be a mixture of these, please give an indication, in percentage terms, of how the deposit base may be structured. Please also provide details as to how you intend to attract your depositors.

                Section 2: Financial and operational risks

                BL2. The appropriate level at which credit decisions are taken will vary according to the type of credit offered and your size and structure. A credit committee may be appropriate, with formal terms of reference laid down. Alternatively, individuals may be given pre-assigned authority limits. It will usually be appropriate for the final credit approval authority to be given by employees reporting independently from the employees interacting with the clients. Further guidance on Credit Risk systems and controls and on the specific areas which the Credit Risk policy should cover, are set out in PIB sections 4.2 and A4.2. Where a credit committee exists, please attach a copy of its terms of reference.
                BL3. This question deals with the Concentration Risk of Large Exposures, general exposures (eg it could be that a large number of loans and investments are concentrated on a particular industry sector) and country exposures. Please refer to PIB.
                BL4. The provisioning polices will need to include the type of reporting mechanisms you use, how often the provisioning policy is reviewed, the type of management reports used and to whom they are circulated, the decision making process for ensuring the adequacy of specific provisions, write-off policy and the procedures and controls in place to identify the need to make provision. Please refer to PIB section 4.2
                BL5. You will need to show how your liquidity strategy seeks to identify, measure, monitor and control Liquidity Risk and how this Liquidity Risk is managed on a day-to-day basis. You should also advise on the expected maturity profile of your proposed deposit base and how you intend to manage any apparent maturity mismatches between your credit portfolio and your funding requirements. Finally your answer should set out what, if any, contingency plans are in place to access liquidity in extreme circumstances. See in particular PIB sections 6 and PIB App 6.
                BL6. You should provide a copy of your policy for managing Trading Book and Non-Trading Book interest rate risk and describe the tools you use to manage it. You should also describe the role of the asset and liability committee or other appropriate management committee in managing this risk.
                BL7. Include a description of the risk identification and monitoring tools and processes, any capital charge calculations models you use to address operational risk and operational risk reporting to the board and senior management. Please explain how your reconciliation, operational and accounting controls ensure the integrity of the general ledger in your financial accounting system at all times.

                Section 3: Conduct of business risks to clients and markets

                BL8. Please refer to COB section 4.2.
                BL9. Please refer to COB section 4.3.
                BL10. Please refer to COB Rule 4.3.1

                [Amended][VER6/08-14]

              • Insurance supplement notes

                Click here to download the notes in PDF FormatPDF Format.

                This section contains information that may assist you in completing the insurance supplement. Each note relates to a question in the insurance supplement. Eg IN8 below provides information to assist you to complete the question at IN8 of the insurance supplement.

                Section 1: Corporate governance, strategy and business model

                IN1. -
                IN2. PIN chapter 10 focuses solely on Insurance Special Purpose Vehicles (ISPV). If you are an ISPV and have answered this question fully, you do not need to answer the remaining questions in this supplement.

                Section 2: Financial and operational risks

                IN3. There is extensive guidance on the management and control of risks in PIN Appendix 2. See in particular PIN sections A2.7 and A2.9.
                IN4. See in particular PIN section A2.14.
                IN5. See in particular PIN section A2.5 and the requirements for actuarial review in PIN chapter 7.
                IN6. See in particular PIN section A2.6.

                Section 3: Conduct of business risks to clients and markets

                IN7. This question relates to Insurance Monies arising from Insurance Intermediation or Insurance Management business. These are defined in COB Rule 7.12.2 and the rules on handling them are contained in COB Rules 7.12.57. 12.15.
                IN8. If you have cover agreements, agency agreements or mandates with Insurers that give you authority to accept risk on behalf of Insurers, we want some detail on what those arrangements are. Your response should include the list of Insurers you intend to use over the next 12 months and the limits of the authority that you have to accept risk on behalf of the Insurer, for example, what is the maximum capacity in respect of any one risk? (It may be easier for you to provide copies of the relevant agreements.)

                [Amended][VER6/08-14]

              • Islamic Finance Business supplement notes

                Click here to download the notes in PDF FormatPDF Format.

                This section contains information to assist you in completing the Islamic Financial Business supplement. Each note relates to a question in the Islamic Financial Business supplement. Eg IF2 below provides information to assist you to complete the question at IF2 of the Islamic Financial Business supplement.

                Section 1: Corporate governance, strategy and business model

                IF1. Set out your track record in Islamic Financial Business and how you are regulated in other jurisdictions in relation to Islamic Financial Business.
                IF2. Please refer to GLO for the definitions of Islamic Financial Business, Islamic Financial Institution and Islamic Window.
                IF3. Explain how each financial Transaction effected as part of your Islamic Financial Business takes place. This should take account of Murabaha, Mudaraba, Musharaka, Ijarah, Istisna, Salam, Kefala, Sukuk, Bai Bithman Ajil, Arboun, Takaful, and any other types of Islamic Contract. Identify the prudential risks involved in a transaction and which party carries those risks. See chapter IFR 3 and IFR 5 for the prudential treatment of Islamic Contracts.
                IF4. See IFR chapter 3 for requirements in relation to your Shari'a Supervisory Board (SSB).
                IF5. See IFR chapter 3 on appointment, dismissal and remuneration.
                IF6. -
                IF7. See IFR Rule 3.5.4

                Section 2: Financial and operational risks

                IF8. -
                IF9. -
                IF10. See IFR section 3.4.
                IF11. See IFR chapter 3.
                IF12. See IFR section 3.6 and IFR section 3.7.

                Section 3: Conduct of business risks to clients and markets

                IF13. See IFR section 3.8.
                IF14. See IFR section 3.8.
                IF15. See chapters IFR 3 and IFR 5. Please also refer to PIB chapter 3 for prudential treatment.
                IF16. See IFR chapter 5.
                IF17. See IFR chapter 5.
                IF18. -
                IF19. -
                IF20. See IFR chapter 6
                IF21. -
                IF22. See IFR Rule 3.7.2.

                [Amended][VER6/08-14]

              • Public Fund supplement notes

                Click here to download the notes in PDF FormatPDF Format.

                This section contains information that may assist you to complete the Public Fund supplement. Each note relates to a question in the Public Fund supplement. Eg PF3 below provides information to help you to complete the question at PF3 of the Public Fund supplement.

                The following boxes marked 'X' indicate which sections of this form need to be completed by you:

                  Type of Public Fund Application
                Applicable Section Authorisation as a Domestic Fund Manager Variation of Licence as a Domestic Fund Manager Applying as an External Fund Manager Existing Domestic / External Fund Manager seeking Registration of an additional Public Fund Converting an existing Exempt Fund to Public Fund status
                Section 1:
                Information about the Domestic Fund Manager
                X X     X
                Section 2:
                Information about the Trustee*
                X X X X X
                Section 3:
                Documentation for a Domestic Fund Manager
                X X     X
                Section 4:
                Documentation for an External Fund Manager
                    X   X
                Section 5:
                Information about a Fund
                X X X X X
                Section 6:
                Documentation for a Fund
                X X X X X
                Section 7:
                Disclosure & Declaration
                    X X X
                Section 8:
                Additional Declaration for External Fund Manager
                    X X X

                * Only applies to Investment Trusts

                Section 1: Information about the Domestic Fund Manager

                PF1. You should describe how the Fund Manager's procedures and controls will ensure that:
                a) the fund is valued according to CIR 8.4 (Valuation of a fund) and the extent to which you will follow CIR App4 ("Guidance on asset valuation and pricing") or other alternative methodologies, which should be described;
                b) a single price is determined in accordance with CIR 8.5 (Determination of a single price);
                c) if the Fund is an open-ended Funds, issues and redemptions are able to be made at all times during dealing days in accordance with CIR 8.6 (Issue and redemption),
                d) a register of each Unitholder is maintained in the DIFC in accordance with CIR 8.7 (Unitholder register); and
                e) sufficient accounting and other records are held in the DIFC in accordance with CIR 8.10 (Maintenance of records).
                PF2. Please provide details regarding who is the Eligible Custodian and how it meets the requirements in CIR section 8.2 of CIR. Please also see CIR section 8.12 and CIR Appendix 1 for delegation requirements.
                PF3. Please provide details regarding who will carry out the investment management activities of the Fund. This should include the name of the Service Provider, a summary of the due diligence required under CIR 8.12.4, the Service Provider regulator, and attach the draft Delegation Agreement. Please also specify how the Service Provider meets the criteria under CIR Rule 8.12.2. Please see CIR section 8.12 and CIR Appendix 1 for delegation requirements.
                PF4. Please provide details regarding who will carry out the Fund Administration. CIR chapter 5 specifies the requirements applying to a Fund Administrator. You should also include the name of the Service Provider, a summary of the due diligence required under CIR 8.12.4, the Service Provider regulator, and attach the draft Delegation Agreement. Please also specify how the Service Provider meets the criteria under CIR Rule 8.12.2. Please see CIR section 8.12 and CIR Appendix 1 for delegation requirements.
                PF5. Please see Article 38 of the Collective Investment Law and make reference to the Fund's constitution and prospectus.
                PF6. Please refer to Articles 39-42 of the Collective Investment Law as well as CIR section 10.3.
                PF7. You must confirm which oversight arrangement is applicable to your Fund whether it be an oversight committee, Eligible Custodian or Trustee.
                PF8. Please see CIR section 9.3 regarding auditors.
                PF9. Please advise which of the following accounting standards permitted by CIR 9.2 will be followed by the Fund: IFRS Supplemented by IMA SORP; US GAAP; AAOIFI (for an Islamic Fund).

                Please see CIR Rule 9.2.1.
                PF10. Please see CIR 5.1.2 and the AML Module.
                PF11. If you wish to have any of the DFSA Rules waived or modified, you must submit the Form SUP 2.

                Section 2: Information about the Trustee

                PF12. -
                PF13. Article 21 of the Collective Investment Law provides for three categories of persons as capable of acting as a Trustee. This includes a body corporate which is an Authorised Firm with a Licence authorising it to act as a Trustee or to Provide Custody; or a person regulated and supervised by Financial Services Regulator in a Recognised Jurisdiction with respect to its custody or depositary services.
                PF14. Please see the relevant sections of the CIR module and Investment Trust Law 2006 for the requirements of a Trustee of a Fund and Trust Deed.
                PF15. Please see CIR 7.1.3
                PF16. Please see CIR 8.7 and Article 25 of the Investment Trust Law.
                PF17. Please see CIR 8.12.3CIR 8.12.7.
                PF18. Please see CIR 10.3.1 and CIR 10.3.4.

                Section 3: Documentation for a Domestic Fund Manager

                PF19. Please see sections CIR 8.2 and CIR 8.12 as well as CIR APP 1.

                Section 4: Documentation for an External Fund Manager

                PF20. If you are unable to attach a letter of good standing from your regulator regarding your application, you must arrange for it to be sent directly to the DFSA by your regulator prior to submission of this application. Otherwise DFSA will not be able to accept submission of your application.
                PF21. -
                PF22.  
                PF23. Please see CIR 6.1.3 regarding the appointment of a Fund Administrator or Trustee as agent of an External Fund Manager. Please note the agreement must contain the information regarding the type of powers being granted to the agent to facilitate the External Fund Manager in relation to its dealings with the DFSA and Unitholders and prospective Unitholders such as:
                •    If it is an open-ended Fund, the issue, resale and redemption of the Units of the Fund and the publication of the price at which such issue, resale or redemption will occur as provided under the Law and the Rules;
                •    The sending to Unitholders of the Fund all the reports required under the Law and the Rules;
                •    Access to the Constitution and most recent Prospectus of the Fund to Unitholders and Prospective Unitholders;
                •    Access to the Unitholder register; and
                •    Access to the books and records relating to the Fund as required by the DFSA and any person providing the oversight functions of the Fund, in or from a place in the DIFC.
                PF24. Please refer to the notes in PF23.

                Section 5: Information about the Fund

                General information

                PF25. -
                PF26. Please refer to Article 16(1) of the Collective Investment Law for the Domestic Fund criteria.
                PF27. Please see Article 26 of the Collective Investment Law for the permitted form of a Domestic Fund.
                PF28. Please see Chapters CIR 3 and CIR 13 as well as IFR Chapter 6.
                PF29. -
                PF30. A Fund Manager is under an obligation to operate and administer a Fund in line with its risk profile and investment objectives set out in the Prospectus of the Fund. Please see CIR Rule 10.5.2.
                PF31. If the fund has exposures to derivatives it should describe in detail the risk management processes which will be implemented by the Fund Manager to ensure it is able to monitor and measure as frequently as appropriate the risk of the Fund's Derivative positions and their contribution to the risk profile of the Fund. Please see CIR Rule 10.5.5.
                PF32. Please see CIR 10.5.6CIR 10.5.7 and also CIR chapter 13 for requirements applicable to specific types of Fund.
                PF33. Please advise whether the Fund is planning to list on an Authorised Market Institution immediately upon, or shortly after (within the first 12 months) of the Fund's incorporation or establishment. Please distinguish between any longer term plans to list, for example as an exit strategy for the Fund's initial Unitholders.

                Additional information about Specialist Funds

                Private Equity Fund ( the following 3 questions only apply if you intend to manage a Private Equity Fund)
                PF34. Please see CIR Rule 13.3.1.
                PF35. Please see Rules CIR 13.3.3CIR 13.3.4.
                PF36. Please refer to CIR 14.4.5
                Hedge Fund ( the following 7 questions only apply if you intend to manage a Hedge Fund)
                PF37. Please refer to the Hedge Fund Code of Practice section in Part 6 of these notes. This is a principle-based code that sets out what the DFSA views as best practice standards for Hedge Funds.
                PF38. Please see CIR Rule 13.6.1.
                PF39. Please see CIR Rule 13.6.2
                PF40. Explain any prime brokerage relationships including details of any borrowing and custodial arrangements as per CIR Rule 13.6.3.
                PF41. In relation to side letters, please refer to principle 7 of the DFSA Hedge Fund Code of Practice. This is also located in this Notes Booklet.
                PF42. A side pocket is an arrangement under which a Fund Manager of a Fund (such as a Hedge Fund) may segregate illiquid assets from the main portfolio of the Fund by issuing to Unitholders a new class of Units which participates only in the assets held in the side pocket. Such Units are not redeemable until the Fund is able to liquidate the assets held in the side pocket. To be able to create side pockets, the Fund Manager must have a clear mandate that enables it do so, and adequate prior disclosure should also be made to Unitholders of the discretion which the Fund Manager has to create such side pockets, including the circumstance in which the Fund Manager may exercise that discretion.
                PF43. Please see CIR Rule 14.4.6
                Property Fund ( the following 6 questions only apply if you intend to manage a Property Fund)
                PF44. Please see CIR Rule 13.4.1
                PF45. Please see CIR Rule 13.4.4
                PF46. Please see Rule CIR 13.4.5 and CIR 13.4.10.
                PF47. Please see Rule CIR 13.4.18CIR 13.4.21
                PF48. Please see CIR Rule 13.4.3
                PF49. Please see CIR Rule 14.4.2
                Real Estate Investment Trust (the following question only apply's if you intend to manage a Real Estate Investment Trust)
                PF50. Please see CIR section 13.5.
                Islamic Fund ( the following 2 questions only apply if you intend to manage an Islamic Fund)
                PF51. Please see IFR Rule 6.2
                PF52. Please see IFR 6.2.1 (2)
                PF53. Please see IFR 6.2.1 (3)
                PF54. Please see IFR 6.5.
                PF55. Please see IFR Rule 6.1
                Feeder Fund (the following 2 questions only apply if you intend to manage a Feeder Fund)
                PF56. Please see CIR 13.2
                PF57. Please see CIR Rule 14.4.1
                Fund of Funds (the following question only apply's if you intend to manage a Fund of Funds)
                PF58. Please see CIR Rule 13.1
                Umbrella Funds (the following question only apply's if you intend to manage an Umbrella Fund)
                PF59. Please see CIR Rule 13.7

                Additional information about an External Fund

                PF60. The Fund Manager of an External Fund must:
                (a) have systems and controls which are adequate to ensure compliance with the requirements that apply to the External Fund in the jurisdiction in which it is established or domiciled; and
                (b) inform the DFSA of the jurisdiction in which the Fund is or is to be established or domiciled and the nature of regulatory requirements applicable applicable to the Fund in the host jurisdiction.
                A Fund Manager of an External Fund is generally not subject to the requirements that otherwise apply to other Domestic Funds (see Article 14(2) of the Law). However, some limited requirements apply to External Funds. See for example the disclosure required under Rules CIR 14.2.4CIR 14.2.7. Should such a requirement conflict with any requirements that apply to an External Fund in the jurisdiction in which the Fund is domiciled, the Fund Manager may apply to the DFSA for appropriate waivers or modifications of the DFSA requirements.

                The DFSA may upon receipt of the information referred to in CIR Rule 6.2.2(b), assess the desirability of establishing an External Fund in that particular jurisdiction chosen by the Fund Manager. Relevant considerations include:
                (a) The Fund Manager's need to establish the Fund in the particular jurisdiction for reasons such as the physical location of the Fund assets or investor preference;
                (b) Any regulatory risks arising from establishing the External Fund in the relevant jurisdiction, particularly if the Fund is to be open to retail investors; and
                (c) Whether the relevant jurisdiction complies with the FATF or other relevant international standards or requirements.
                PF61. Give the name of the supervisory contact person from the relevant regulator including postal address, telephone number, fax number and e-mail address.
                PF62. -
                PF63. Please see CIR Rule 6.2.2
                PF64. If you wish any of the DFSA Rules waived or modified you must submit the Form SUP 2.

                Section 6: Documentation for a Fund

                PF65. The Constitution of the Fund must be in compliance with CIR Chapter 7 and CIR APP5.
                PF66. The Constitution of the Fund must be legally certified by the Funds legal advisers as complying with the requirements set out in CIR and the Collective Investment Law 2006.
                PF67. The Prospectus of the Fund must be in compliance with CIR Chapter 14, CIR Appendix 7 and CIR Rule 10.4.
                PF68. The Prospectus of the Fund must be legally certified by the Funds legal advisers as complying with the requirements set out in the CIR and Collective Investment Law 2006 and under CIR.
                PF69. Please see CIR 9.3.1
                PF70. Please provide a copy of the Fund approval letter from the Financial Services Regulator who was responsible for approval and the ongoing monitoring of the Fund

                Section 7: Disclosure & Declarations

                This section should be completed by all applicants.

                Section 8: Additional Declaration for an External Fund Manager

                This section should be completed by an External Fund Manager only.

                [Amended][VER6/08-14]

              • Sales and trading supplement notes

                Click here to download the notes in PDF FormatPDF Format.

                This section contains information that may assist you to complete the sales and trading supplement. Each note relates to a question in the sales and trading supplement. Eg ST11 below provides information that assists applicants to complete the question at ST11 of the sales and trading supplement.

                Section 1: Corporate governance, strategy and business model

                ST1. Describe in detail what sales and trading you will be carrying out. We want to understand which activities and which products your business will entail and to know, in income terms, the significance of each business line in the overall business plan.
                ST2. Explain how your senior management determines and updates your business strategy. Please describe how your business performance is reviewed, how new business initiatives are adopted, and the processes involved in determining Client take on, new product development, new business activities and, for proprietary trading, your risk tolerance in relation to your capital.
                ST3. Provide a Transaction flow chart for each type of sales and/or trading Transaction that you will undertake. These should clearly identify your role, the Client's role and the role of any other third parties in each Transaction. Please indicate the movement of monies and assets. Each step in a Transaction should be clear, with the responsibilities and obligations of the parties involved clearly identified.

                Section 2: Financial and operational risks

                Risk management
                ST4. Describe how you functionally separate risk management from business functions, and how you ensure that risk management can challenge the business as appropriate. You may want to reference internal mechanisms such as reporting lines, management information, internal risk assessment reviews. Please see GEN section 5.3.
                ST5. -
                ST6. This question relates to principal and client trading. We would expect a description to include details of any stress testing and validation model-based techniques used.
                ST7. We are interested to know how you will intend to manage Client accounts in terms of payments, distributions, valuations, and reporting.
                ST8. -
                Internal control environment
                ST9. Provide a copy of relevant Client Agreements. Please see COB chapter 3 and COB APP2.
                ST10. See COB chapter 6 for record keeping requirements.
                ST11. We want to know how you will ensure appropriate clearing and settlement of Transactions.
                Client Assets
                ST12. -
                ST13. See COB sections 6.11, 6.12, and 6.13.
                ST14. We want to know how you will reconcile your records of Client Assets, including Client Money, with the records of other parties (such as third party custodians) so as to ensure any differences identified are rectified promptly.
                ST15. -

                Section 3: Conduct of business risks to clients and markets

                ST16. We want to know how you ensure that your employees, particularly in the front office and Client facing roles, are competent. You may want to refer to your recruitment process and ongoing training and competence programmes. Please see GEN Rule 5.3.19.
                ST17. See GEN chapter 9. You will need to show that you have procedures in place to ensure that a complaint from a Retail Client will be handled fairly, consistently and promptly.
                ST18. See COB section 6.4.
                ST19. See COB section 3.4. You will need to show you ensure that advice to Clients is suitable and in line with requirements.
                ST20. Please see COB chapter 3 and COB chapter 6.
                ST21. You can only market Foreign Funds that meet our requirements. Please see CIR chapter 15.
                ST22. It is important for you to ensure that you are not involved in market abuse such as market manipulation / insider trading. We want to understand what controls you have in place to prevent abusive practices.

                [Amended][VER6/08-14]

            • AFN AUT-NOTES Part 4: Exempt Fund form notes

              Click here to download the notes in PDF FormatPDF Format.

              Exempt Fund form notes

              This section contains information to assist you to complete the Exempt Fund form. Each note relates to a question in the Exempt Fund form. e.g. EF5 below provides information to assist you to complete the question at EF5 of the Exempt Fund form.

              The following boxes marked 'X' indicate which sections of this form need to be completed by you:

                Type of Exempt Fund Application
              Applicable Section Authorisation as a Domestic Fund Manager Variation of License as a Domestic Fund Manager Applying as an External Fund Manager Existing Domestic / External Fund Manager giving Notification of additional Exempt Fund
              Section 1:
              General Information
              X X X  
              Section 2:
              Contact Details
              X X X  
              Section 3:
              Information about the Domestic Fund Manager
              X X    
              Section 4:
              Documentation for a Domestic Fund Manager
              X X    
              Section 5:
              Documentation for an External Fund Manager
                  X  
              Section 6:
              Compulsory supporting documents for a Fund Manager
              X X X  
              Section 7:
              Fees for a Domestic Fund Manager Application / Domestic Fund (Initial Annual Fee)
              X X X X
              Section 8:
              Prudential Regulatory Reporting for a Domestic Fund Manager
              X X    
              Section 9:
              Fit & Proper Questionnaire & Declaration
              X X X  
              Section 10:
              Information about the Fund
              X X X X
              Section 11:
              Disclosure & Declaration
              X X X X
              Section 12:
              Additional Declaration for External Fund Manager
                  X  

              Section 1 General information

              PF1. -
              PF2. -
              PF3. We are seeking information about the legal nature of your Firm. Please refer to GEN Rule 7.2.2.
              PF4. There are generally two types of firms applying to be Authorised Firms: DIFC entities and non-DIFC entities (or Branches).

              DIFC entities are firms that have been created under DIFC legislation, such as DIFC Company Law or DIFC General Partnership Law.

              Non-DIFC entities are firms that have been created outside of the DIFC under the laws of another jurisdiction, but who want to establish a place of business in the DIFC. Such firms are commonly referred to as Branch offices. Note that legally, the Branch is not a separate legal person to the firm.
              PF5. Start-up entities are either new Financial Services businesses or existing Financial Services businesses which have not been subject to Financial Services regulation in the past. Please refer section 2-5 of the RPP Sourcebook module.
              PF6. Give the name of the supervisory contact person from the relevant regulator including postal address, telephone number, fax number and e-mail address.
              PF7. Please refer to GLO for the definition of Islamic Financial Business.
              PF8. If the company is going to be formed in the DIFC, please answer 'in formation'.
              PF9. Your financial year-end will be used to determine the regulatory reporting requirements.
              PF10. You will need to give details of any trading name(s) which you propose to use for the purpose of, or in connection with, any business carried out in or from the DIFC, if these are different from your legal name.

              Section 2 - Contact details

              PF11. The contact person named should be the person who is responsible for the application during this process and who will liaise with the DFSA. This person must be a representative of the company. It may be helpful to provide a second contact name as back up.
              PF12. If you do not have an adviser assisting you with this application, please go to question EF14.
              PF13. You may have a professional adviser assisting you with this application. Please tick yes if the DFSA should copy correspondence in relation to this application to the adviser.
              PF14. You need to give the full address of the registered and current / proposed place of business in the DIFC or Dubai. It is expected that prior to submitting an application for authorisation, you will have already approached the Dubai International Financial Centre Authority (DIFCA) in relation to securing premises.
              PF15. Whether you are a DIFC entity or non-DIFC entity, please provide your head office address.
              PF16. -
              PF17. State the name of your auditor, their address, the relevant contact person, telephone number and fax number. Note that for Domestic Firms, the auditor must be an auditor registered with the DFSA in accordance with GEN chapter 8.
              PF18. -

              Section 3: Information about the Domestic Fund Manager

              PF19. You should confirm whether or not the Fund Manager's procedures and controls will ensure that it meets the management and operation requirements of CIR Chapter 8.
              PF20. Please provide details regarding who is the Eligible Custodian and whether it meets the requirements in CIR section 8.2 of CIR. Please also see CIR section 8.12 and CIR Appendix 1 for delegation requirements.
              PF21. Please provide details regarding who will carry out the investment management activities of the Fund and that it meets the requirements. Please see CIR section 8.12 and CIR Appendix 1 for delegation requirements.
              PF22. Please provide details regarding who will carry out the Fund Administration and confirm that it meets the requirements in GEN and also in CIR section 8.12 and CIR Appendix 1 for delegation requirements.
              PF23. Please see CIR section 9.3 regarding auditors.
              PF24. Please advise which of the following accounting standards permitted by CIR 8.2 will be followed by the Fund: IFRS Supplemented by IMA SORP; US GAAP; AAOIFI (for an Islamic Fund). Please see CIR Rule 9.2.1.
              PF25. Please see CIR Chapter 9.
              PF26. If you wish to have any of the DFSA Rules waived or modified you must submit the Form SUP 2.

              Section 4: Documentation for a Domestic Fund Manager

              PF27. Organogram of group structure

              This should identify all Controllers, other shareholders and Close Links including a breakdown of shareholding, jurisdiction in which the entity/individual is based, and identification of any other regulated entities. Where shares are held by a trust, provide details of all trustees, settlers and beneficiaries.
              Also provide narrative regarding intra-group transactions and business relationships e.g. guarantees, cash flows and their rationale.
              PF28. Staff organogram including reporting lines

              This should identify the senior management / head functions with significant influence and any reporting lines to the Governing Body. Please ensure the CO and MLRO also have access to both the Senior Executive Officer and the board.
              PF29. -
              PF30. -
              PF31. AUT-IND1 forms

              You must fill in an AUT-IND1 form for each individual who will be performing a Licensed Function. An Authorised Individual is a person who is approved by the DFSA to perform a Licensed Function for an Authorised Firm. Licensed Functions are defined in GEN section 7.4. A person may perform more than one Licensed Function. However we do not expect to see the same individual carrying out both business and control responsibilities, for example, Senior Executive Officer and Compliance Officer roles.
              PF32. Financial projections

              Please attach the following financial projections and assumptions commencing at the time of authorisation and, on a quarterly basis, for each of the first three financial years after licensing:
              •   Balance sheet (if applicable)*
              •   Profit and loss account, split into income streams; and
              •   Cash flow statement (if applicable)*
              •   forecast of your Capital Resources versus your Capital Requirement
              *These items may not be applicable in the case of a Branch.

              Please provide the figures in the DFSA reporting return format. A list of the key assumptions supporting these financial projections must also be submitted. Please confirm whether you have stress tested your forecasts and provide details.
              PF33. Evidence of source of funds for start-up
              For start-ups, supporting evidence of the original source of funds which will be used to provide initial capital resources. We usually require details of how the money sourced for the start-up entity has been generated. Please provide a bank reference. You may be asked for a declaration that the funds are not from the proceeds of crime.
              PF34. -
              PF35. -

              Section 5: Documentation for an External Fund Manager

              PF36. If you are unable to attach a letter of good standing from your regulator regarding your application, you must arrange for it tobe sent directly to the DFSA by your regulator prior to submission of this application. Otherwise DFSA will not be able to accept submission of your application.
              PF37. -
              PF38. Please see CIR 6.1.3 regarding the appointment of a Fund Administrator or Trustee as agent of an External Fund Manager. Please note the agreement must contain the information regarding the type of powers being granted to the agent to facilitate the External Fund Manager in relation to its dealings with the DFSA and Unitholders and prospective Unitholders such as:
              •   If it is an open-ended Fund, the issue, resale and redemption of the Units of the Fund and the publication of the price at which such issue, resale or redemption will occur as provided under the Law and the Rules;
              •   The sending to Unitholders of the Fund all the reports required under the Law and the Rules;
              •   Access to the Constitution and most recent Prospectus of the Fund to Unitholders and Prospective Unitholders;
              •   Access to the Unitholder register; and
              •   Access to the books and records relating to the Fund as required by the DFSA and any person providing the oversight functions of the Fund,
              in or from a place in the DIFC.
              PF39. Please refer to the notes in EF38.

              Section 6: Compulsory Supporting Documents for a Fund Manager

              The documents required in this section can be self-certified by all firms. Be aware that you may still be asked to supply all or any of the documents as part of the application.
              PF40. Compliance manual This is a critical document which will impact the decision whether the firm should be authorised. The DFSA prefers it if the compliance procedures are incorporated in one manual. Once you receive authorisation, our Supervision team will visit and ask to see the manual. The manual should include the following details:
              •    The structural oversight and reporting arrangements that will enable you to continually meet your compliance obligations under applicable legislation in the DIFC;
              •    How compliance reports are prepared, authorised, disseminated and followed up;
              •    How compliance breaches are detected, recorded, categorised and rectified;
              •    How the DFSA and other Financial Services Regulators, if applicable, will be kept appraised of all relevant breaches;
              •    How you will keep your firm updated of any changes to applicable legislation in the DIFC and DFSA Rules;
              •    The arrangements for handling, resolving and recording complaints received from clients, with particular reference to the requirements of GEN chapter 9 (Internal Dispute Resolution and Complaints Handling);
              •    How you will embed a positive mind-set towards compliance issues from all your employees, not just your compliance team;
              •    How you will ensure compliance by any Person under a material outsourcing or delegation arrangement with relevant Regulations and procedures;
              •    How you will determine and maintain records of Client verification;
              •    How you will ensure training and competence are embedded into your firm's culture;
              •    Who will be responsible for reviewing the compliance plan, and how often the plan will be reviewed and what process will be followed;
              •    How you will ensure compliance with financial reporting and regulatory capital requirements;
              •    How senior management and the board will identify and manage conflicts of interest between different clients, and between the firm and its clients.
              PF41. Anti-money laundering procedures Your anti-money laundering procedures should include, amongst other things, arrangements to:
              •    Ensure compliance with UAE Law No 4 and any other relevant UAE federal laws. The only exception is if another jurisdiction's laws or regulations prevent or inhibit you from complying with UAE Law No 4 or the DFSA Rules; in which case you should tell us. Also note that should such an event arise in the future, Authorised Firms are obliged to promptly notify us in writing;
              •    Ensure compliance with relevant resolutions or sanctions issued by the United Nations Security Council. Please refer to GEN Rule 5.3.30.
              •    Monitor for, detect and report suspicious customers and transactions. You should ensure your procedures comply with the requirement for Suspicious Transaction Reports (STRs), to be made in the required format to the Anti-Money Laundering Suspicious Cases Unit (AMLSCU), with a copy provided to the DFSA. Details of the required format of the report and details for submission can be found on the DFSA website;
              •    Establish and verify the identity of the customer and any other person on whose behalf the customer is acting, including that of the beneficial owner. Details will need to be provided if you intend to delegate any aspect of the customer identification process to a qualified professional or the Unitholder verification process to a Fund Administrator;
              •    Establish and verify your business partners' identities, including correspondent Banks;
              •    Provide an audit trail of transactions;
              •    Determine the duties and obligations of your Money Laundering Officer (MLRO);
              •    Review the effectiveness of your Anti-Money Laundering policies, procedures, systems and controls at minimum on an annual basis;
              •    Respond to any request for information made by UAE authorities or the DFSA. You will need to state where customer or Unitholder identification records will be kept outside of the UAE, whether there is any secrecy or data protection legislation that would restrict access by the applicant, the DFSA or the law enforcement agencies of the UAE. If this is the case, you will need to provide details of the arrangements that it will be put in place to ensure copies of these records are kept in a jurisdiction which allows access;
              •    Maintain AML relevant documents and records;
              •    Ensure that you obtain and make use of findings in relation to names of persons, groups, organisations or entities, or any other body where suspicion of money laundering or terrorist financing exists;
              •    Assess your risks in relation to money laundering and perform enhanced due diligence investigations for higher risk products, services and customers;
              •    Determine whether a customer is a Politically Exposed Person (PEP) and address the associated risks accordingly;
              •    Establish and maintain an anti-money laundering training programmes and awareness sessions. This should include a description of the arrangements in place to ensure you obtain use any government, regulatory and international findings;
              •    Ensure compliance with any other obligation in the DFSA's AML module. You must have arrangements in place to provide appropriate Anti-Money Laundering training (including the internal reporting duties and Client identification duties) to your employees. Please provide full details of what training you will provide for all your relevant employees and whether the MLRO will be in charge of this training. If the MLRO will not be in charge, then give the full name and job title of the person who will be;
              •    If you will be Providing Fund Administration, ensure such procedures are also relevant with respect to Unitholders of a Fund;
              •    You will need to provide the details of the Deputy Money Laundering Officer, including Surname/Family name and Given name.
              •    You will need to state whether your Anti-Money Laundering function will be subject to oversight, review or audit by either your Parent's Anti-Money Laundering function, internal audit or another internal function or external organisation. If so, you will need to specify the arrangements including the nature of the oversight, review or audit and the scope and frequency with which it will be undertaken.
              •    AML Rule 3.4.1 requires a firm to take reasonable steps to verify the identity of its customers. Please detail the policies, procedures, systems and controls that you will put in place to ensure that sufficient evidence of the identity of all your Clients (or a Fund's Unitholders, if relevant) will be obtained.
              •    Detail the procedures or systems that you will put in place to ensure that "Know Your Customer" (KYC) or Unitholder information is made available to your relevant employees. In addition, are there any systems that will be set up to obtain further information;
              •    Detail the proposed disciplinary steps that you will put in place for any employee who fails to report promptly to the MLRO any suspicion or beliefs that money laundering is occurring as required in AML chapter 3.5;
              •    Describe the record keeping arrangements you will put in place for records, as specified in the AML module of the DFSA Rulebook.
              PF42. Compliance monitoring programme
              •    Your programme should document how compliance is monitored within the business units.
              PF43. Risk management policies
              Your policy document should describe the risk management arrangements you will establish and maintain to identify, assess, mitigate, control and monitor the risks arising from the Financial Services activities carried out in or from the DIFC. Such arrangements should also take into account the Funds for which you are acting as the Fund Manager.

              Include the following: The nature, scope and organisational structure of your risk management functions. The reporting lines and nature, scope and frequency of risk reporting, including the composition and terms of reference of any risk committees and any appropriate links to Group risk reporting.
              PF44. Delegation Agreement
              Your agreement should describe the delegation arrangements in place for the particular function whether it be custody, investment management or fund administration. Please see GEN and sections CIR 8.2 and CIR 8.12 as well as CIR Appendix 1 for delegation requirements.

              Section 7: Fees for a Domestic Fund Manager Application / Domestic Fund (Initial Annual Fee)

              Details of fees can be found in the Fees module of the DFSA Rulebook.

              Section 8: Prudential Regulatory Reporting for a Domestic Fund Manager

              PF45. Please refer to GEN section 8.2 to determine the accounting standards to be used in preparing your financial accounts and statements.
              PF46. -

              Section 9: Fit and Proper Questionnaire

              EF47-52. These questions are self-explanatory and are focused on the fitness and propriety of the firm. Please supply all relevant information - openness and honesty are essential. Should we need to examine your application more closely because of any disclosures you make, this will not necessarily count against you. However, deliberately withholding information or providing false or misleading information, will adversely impact the success of your application. If in doubt, disclose.

              Section 10: Information about the Fund

              General information

              EF53 Please see CIR Rule 7.1.4.
              EF54 Please refer to Article 16(4) of the Collective Investment Law for the Domestic Fund criteria.
              EF55 Please see Article 26 of the Collective Investment Law for the permitted form of a Domestic Fund.
              EF56 Please see CIR Chapter 3 or IFR Chapter 6.
              EF57 Please see the applicable parts of CIR Chapter 3.
              EF58 -
              EF59 -
              EF60 -

              Additional information about an External Fund

              EF61 The Fund Manager of an External Fund must:
              (a) have systems and controls which are adequate to ensure compliance with the requirements that apply to the External Fund in the jurisdiction in which it is established or domiciled; and
              (b) inform the DFSA of the jurisdiction in which the Fund is or is to be established or domiciled and the nature of regulatory requirements applicable applicable to the Fund in the host jurisdiction.
              A Fund Manager of an External Fund is generally not subject to the requirements that otherwise apply to other Domestic Funds (see Article 14(2) of the Law). However, some limited requirements apply to External Funds. See for example the disclosure required under Rules CIR 14.2.4CIR 14.2.7. Should such a requirement conflict with any requirements that apply to an External Fund in the jurisdiction in which the Fund is domiciled, the Fund Manager may apply to the DFSA for appropriate waivers or modifications of the DFSA requirements.

              The DFSA may upon receipt of the information referred to in CIR Rule 6.2.2(b), assess the desirability of establishing an External Fund in that particular jurisdiction chosen by the Fund Manager. Relevant considerations include:
              (a) The Fund Manager's need to establish the Fund in the particular jurisdiction for reasons such as the physical location of the Fund assets or investor preference;
              (b) Any regulatory risks arising from establishing the External Fund in the relevant jurisdiction, particularly if the Fund is to be open to retail investors; and
              (c) Whether the relevant jurisdiction complies with the FATF or other relevant international standards or requirements.
              EF62 Give the name of the supervisory contact person from the relevant regulator including postal address, telephone number, fax number and e-mail address.
              EF63 -
              EF64 Please see CIR Rule 6.2.2
              EF65 If you wish any of the DFSA Rules waived or modified you must submit the Form SUP 2.

              Compulsory Supporting Documents for a Fund

              EF66 The Constitution of the Fund must be in compliance with CIR Chapter 7 and CIR APP5.
              EF67 The Prospectus of the Fund must be in compliance with CIR Chapter 14 and CIR Rule 12.2.

              Section 11: Disclosure & Declarations

              This section should be completed by all applicants.

              Section 12: Additional Declaration for an External Fund Manager

              This section should be completed by an External Fund Manager only.
              [Amended][VER23/04-11]
              [Amended][VER6/08-14]

            • AFN AUT-NOTES Part 5: AFN AUT-NOTES Part 5: Qualified Investor Funds

              • Qualified Investor Funds: Domestic Fund Manager form notes

                Click here to download the notes in PDF FormatPDF Format.

                This section contains information to assist you to complete the Qualified Investor Fund: Domestic Fund Manager form. Each note relates to a question in the Qualified Investor Fund: Domestic Fund Manager form e.g. QM5 below provides information to assist you in completing the question at QM5 of the Qualified Investor Fund: Domestic Fund Manager form.

                Section 1: Declaration

                This section should be completed by all applicants.

                Section 2: General information

                QM1. Please provide the full name of the firm applying to be licensed as a Fund Manager.
                QM2. This form can be used for either an applicant to be an Authorised Firm or an Authorised Firm making a separate request to the DFSA to change the scope of its current Licence in respect of Managing a Collective Investment Fund which is a Qualified Investor Fund. In addition to this we are also seeking to determine whether you will be providing advice in respect of the QIFs which you intend to manage.
                QM3. We are seeking information about the legal nature of your Firm. Please refer to GEN Rule 7.2.2.
                QM4. There are generally two types of firms applying to be Authorised Firms: DIFC entities and non-DIFC entities (or Branches).
                a. DIFC entities are firms that have been created under DIFC legislation, such as DIFC Company Law or DIFC General Partnership Law.
                b. Non-DIFC entities are firms that have been created outside of the DIFC under the laws of another jurisdiction, but who want to establish a place of business in the DIFC. Such firms are commonly referred to as Branch offices. Note that, legally, the Branch is not a separate legal person to the firm.
                QM5. Start-up entities are either new Financial Services businesses or existing Financial Services businesses which have not been subject to Financial Services regulation in the past. Please refer to section 2-5 of the RPP Sourcebook module.
                QM6. If the company is going to be formed in the DIFC, please answer 'in formation'.
                QM7. Your financial year-end will be used to determine the regulatory reporting requirements.
                QM8. You will need to give details of any trading name(s) which you propose to use for the purpose of, or in connection with, any business carried out in or from the DIFC, if these are different from your legal name.
                QM9. Give the name of the supervisory contact person from the relevant regulator including postal address, telephone number, fax number and e-mail address.
                QM10. Please refer to GLO for the definition of Islamic Financial Business.

                Section 3: Contact details

                QM11. The contact person named should be the person who is responsible for the application during this process and who will liaise with the DFSA. This person must be a representative of the company. It may be helpful to provide a second contact name as a back-up.
                QM12. If you do not have an adviser assisting you with this application, please go to question QM14.
                QM13. You may have a professional adviser assisting you with this application. Please tick yes if the DFSA should copy correspondence in relation to this application to the adviser.
                QM14. You need to give the registered address for the DIFC operation. It is expected that prior to submitting an application for authorisation you will have already approached the Dubai International Financial Centre Authority (DIFCA) in relation to securing premises.
                QM15. You need to give the full address of the current/proposed place of business in the DIFC or Dubai. It is expected that prior to submitting an application for authorisation you will have already approached the Dubai International Financial Centre Authority (DIFCA) in relation to securing premises.
                QM16. Whether you are a DIFC entity or non-DIFC entity, please provide your head office address.
                QM17.
                QM18. State the name of your auditor, their address, the relevant contact person, telephone number and fax number. Note that for Domestic Firms, the auditor must be an auditor registered with the DFSA in accordance with GEN chapter 8.
                QM19.

                Section 4: Nature of Applicant's Business and intended activities in the DIFC

                QM20. The DFSA will review the proposed activities to ensure that they are within the scope of a Fund Manager managing Qualified Investor Funds set out in the Collective Investment Rules Module (CIR) and the General Rules Module (GEN) of the DFSA Rulebook. Please describe what systems and controls the firm will have in place to ensure it conducts the activities of a Fund Manager which is managing Qualified Investor Funds.
                QM21. The following provides a brief summary regarding the structure of funds expressed in the form:

                IC (Investment company)
                GLO definition: An open or closed ended company established for the sole purpose of collective investment which is incorporated under the DIFC Companies Law in accordance with the Regulations made under that Law.


                IP (Investment partnership)
                GLO definition: A limited partnership established for the sole purpose of collective investment which is formed and registered under the Limited Partnership Law 2006 in accordance with the Regulations made under that Law.


                IT (Investment trust)
                GLO definition: An express trust created solely for collective investment purposes under the Investment Trust Law 2006.
                QM22.

                Section 5: Information about the Fund Manager

                QM23. Please confirm whether or not the Fund Manager will ensure that it meets the various requirements set out in the Collective Investment Law, Collective Investment Rules and the General Module (GEN) of the DFSA Rulebook.
                QM24. If you wish to have any of the DFSA Rules waived or modified you must submit the Form SUP 2.

                Section 6: Anti-Money Laundering

                QM25. Please consult the Anti-Money Laundering, Counter-Terrorist Financing and Sanctions Module (AML) of the DFSA Rulebook before confirming that appropriate arrangements are in place.

                Section 7: Documentation for a Fund Manager

                QM26. Organogram of group structure
                This should identify all Controllers, other shareholders and Close Links including a breakdown of shareholding, jurisdiction in which the entity/individual is based, and identification of any other regulated entities. Where shares are held by a trust, provide details of all trustees, settlers and beneficiaries. Please refer to GEN Rule 11.8.3 for the definition of Controller.
                QM27. Staff organogram including reporting lines
                This should identify the senior management / key functions with significant influence and any reporting lines to the Governing Body. Please ensure the CO and MLRO also have access to both the Senior Executive Officer and the board.
                QM28.
                QM29.
                QM30. AUT-IND1 forms
                You must fill in an AUT-IND1 form for each individual who will be performing a Licensed Function. An Authorised Individual is a person who is approved by the DFSA to perform a Licensed Function for an Authorised Firm. Licensed Functions are defined in GEN section 7.4. A person may perform more than one Licensed Function. However we do not expect to see the same individual carrying out both business and control responsibilities, for example, Senior Executive Officer and Compliance Officer roles.
                QM31. Financial projections
                Please attach the following financial projections and assumptions commencing at the time of authorisation and, on a quarterly basis, for each of the first three financial years after licensing:

                •   Balance sheet (if applicable)*
                •   Profit and loss account, split into income streams
                •   Cash flow statement (if applicable)* and
                •   forecast of your Capital Resources versus your Capital Requirement

                *These items may not be applicable in the case of a Branch.

                Please provide the figures in the DFSA reporting return format. A list of the key assumptions supporting these financial projections must also be submitted. Please confirm whether you have stress-tested your forecasts and provide details.
                QM32. Evidence of source of funds for start-ups
                For start-ups, supporting evidence of the original source of funds which will be used to provide initial capital resources. We usually require details of how the money sourced for the start-up entity has been generated. Please provide a bank reference. You may be asked for a declaration that the funds are not from the proceeds of crime.
                QM33.
                QM34.

                Section 8: Compulsory Supporting Documents for a Fund Manager

                The documents required in this section can be self-certified by all firms. Be aware that you may still be asked to supply all, or any, of the documents as part of the application.
                QM35. Compliance manual
                This is a critical document which will impact the decision as to whether the firm should be authorised. The DFSA prefers the compliance procedures to be incorporated in one manual. Once you receive authorisation, our Supervision team will visit your offices and ask to see the manual. The manual should include the following details:
                •   The structural oversight and reporting arrangements that will enable you to continually meet your compliance obligations under applicable legislation in the DIFC;
                •   How compliance reports are prepared, authorised, disseminated and followed up;
                •   How compliance breaches are detected, recorded, categorised and rectified;
                •   How the DFSA and other Financial Services Regulators, if applicable, will be kept appraised of all relevant breaches;
                •   How you will keep your firm updated of any changes to applicable legislation in the DIFC and DFSA Rules;
                •   The arrangements for handling, resolving and recording complaints received from clients, with particular reference to the requirements of GEN chapter 9 (Internal Dispute Resolution and Complaints Handling);
                •   How you will embed a positive mind-set towards compliance issues from all your employees, not just your compliance team;
                •   How you will ensure compliance by any Person under a material outsourcing or delegation arrangement with relevant Regulations and procedures;
                •   How you will determine and maintain records of Client verification;
                •   How you will ensure training and competence are embedded into your firm's culture;
                •   Who will be responsible for reviewing the compliance plan, and how often the plan will be reviewed and what process will be followed;
                •   How you will ensure compliance with financial reporting and regulatory capital requirements;
                •   How senior management and the board will identify and manage conflicts of interest between different clients, and between the firm and its clients.
                QM36. Anti-money laundering procedures
                Your anti-money laundering procedures should include, amongst other things, arrangements to:

                •   Ensure compliance with UAE Law No 4 and any other relevant UAE federal laws.
                •   Ensure compliance with the DFSA's Anti-Money Laundering, Counter-Terrorist Financing and Sanctions Module (AML).
                QM37. Compliance monitoring programme
                Your programme should document how compliance is monitored within the business units.
                QM38. Risk management policies
                Your policy document should describe the risk management arrangements you will establish and maintain to identify, assess, mitigate, control and monitor the risks arising from the Financial Services activities carried out in or from the DIFC. Such arrangements should also take into account the Funds for which you are acting as the Fund Manager.

                Please include the following: The nature, scope and organisational structure of your risk management functions, the reporting lines and nature, scope and frequency of risk reporting, including the composition and terms of reference of any risk committees and any appropriate links to Group risk reporting.

                Section 9: Fees for a Fund Manager Application

                Details of fees can be found in the Fees module of the DFSA Rulebook.

                Section 10: Prudential Regulatory Reporting for a Fund Manager

                QM39. Please refer to GEN section 8.2 to determine the accounting standards to be used in preparing your financial accounts and statements.
                QM40.

                Section 11: Fit and Proper Questionnaire

                QM41-47.
                These questions are self-explanatory and are focused on the fitness and propriety of the firm. Please supply all relevant information — openness and honesty are essential. Should we need to examine your application more closely because of any disclosures you make, this will not necessarily count against you. However, deliberately withholding information or providing false or misleading information, will adversely impact the success of your application. If in doubt, disclose.

                Section 12: Disclosure

                This section should be completed by all applicants.
                [Added][VER6/08-14]

              • Qualified Investor Funds: Fund Notification Form notes

                Click here to download the notes in PDF FormatPDF Format.

                This section contains information to assist you to complete the Qualified Investor Fund: Notification form. Each note relates to a question in the Qualified Investor Fund: Notification form e.g. QF5 below provides information to assist you to complete the question at QF5 of the Qualified Investor Fund: Notification form.

                Section 1: Declaration

                This section should be completed by all applicants.

                Section 2: Contact details

                EX1. Please provide the full name of the Fund Manager.
                EX2. The contact person named should be the person who is responsible for the application during this process and who will liaise with the DFSA. This person must be a representative of the company. It may be helpful to provide a second contact name as a back-up.
                EX3. If you do not have an adviser assisting you with this application, please go to question QF5.
                EX4. You may have a professional adviser assisting you with this application. Please tick yes if the DFSA should copy any correspondence in relation to this application to the adviser.

                Section 3: Fund Structure and Investment Policy

                EX5. Please provide the full name of the Fund.
                EX6. You should confirm whether or not the Fund meets the various requirements set out in Article 16(5) of the Collective Investment Law.
                EX7. Fund Structure.
                Please tick the applicable boxes. Multiple boxes may be used for any one fund if applicable. The following provides a brief summary regarding the structure of funds expressed in the form:


                Investment company
                GLO definition: An open or closed ended company established for the sole purpose of collective investment which is incorporated under the DIFC Companies Law in accordance with the Regulations made under that Law.

                Investment partnership
                GLO definition: A limited partnership established for the sole purpose of collective investment which is formed and registered under the Limited Partnership Law 2006 in accordance with the Regulations made under that Law.

                Investment trust
                GLO definition: An express trust created solely for collective investment purposes under the Investment Trust Law 2006.

                Master Fund
                See CIR 3.1.4

                Feeder Fund
                See CIR 3.1.5

                Umbrella fund
                See CIR 3.1.10.
                EX8. Type of Fund.
                Please tick the applicable boxes. Multiple boxes may be used for any one fund if applicable. The following provides a brief summary regarding the types of funds expressed in the form:


                Traditional
                Essentially the same as a standard mutual fund, such a fund is long-only, unleveraged, with returns driven largely by the performance of the market or an asset class and with no performance-based fees.

                Private equity
                A fund investing in an asset class consisting of equity securities and, to a lesser extent, debt in operating companies that are not publicly traded on an exchange

                Money market
                A Fund that invests in short-term (less than one year) debt securities such as T-bills, CDs and commercial paper.

                REIT
                See CIR 3.1.8

                Islamic
                See CIR 3.1.2

                Hedge fund
                See CIR 3.1.9

                Fund of funds
                See CIR 3.1.3

                ETF
                A fund containing a portfolio designed to replicate the performance of a major index or benchmark, capable of being traded like any other exchange-traded security throughout the trading day.

                CTA
                Essentially, a hedge fund specialising in using futures, options on futures, and forwards to implement its investment strategy.

                Index tracker
                A fund designed to replicate the performance of an index or benchmark (compare ETF).

                Venture capital
                A private equity fund investing in start-up and (generally) small businesses with significant growth potential and characterised as being high-risk/high-return opportunities.

                Real Property (Real Estate)
                See CIR 3.1.7

                Managed currency
                A fund seeking to profit from considered investments in foreign exchange.
                EX9. Asset classes invested into by the Fund.
                Please tick the applicable boxes. Multiple boxes may be used for any one fund if applicable. The following provides a brief summary regarding the asset classes expressed in the form:


                Equities (Shares)
                Shares of ownership in publicly held companies. See GEN A2.1.1 (a)

                Real Property (Real estate)
                GLO definition: Land or buildings, whether freehold or leasehold, where the unexpired term of any lease exceeds 20 years.

                Money market investments (Bills/Notes/Commercial Paper etc.)
                Liquid, short-term, fixed income securities issued by governments or firms

                Government bonds
                Fixed income securities issued by governments

                Futures/options
                For definitions see GEN A2.3.1

                Infrastructure
                Basic physical systems and businesses such as water, power, transport systems, communication systems

                Credit incl. corporate bonds
                Fixed income securities and loans issued by corporations

                Microfinance
                As an asset class, investments are generally made in microfinance institutions (MFIs) which in turn make micro-loans to new businesses in the developing world.
                EX10. Investment strategy used by the Fund.
                Please tick the applicable boxes. Multiple boxes may be used for any one fund if applicable. The following provides a brief summary regarding the investment strategies expressed in the form:


                Long-only
                The fund holds only 'long' positions in assets and securities

                Long-short
                The fund holds long positions in securities it expects to increase in value and short positions in securities (in the same asset class as the long positions) which it expects to decrease in value or to hedge the long positions against general market exposure.

                Short bias
                The fund maintains a net short exposure to the market through a combination of short and long positions.

                Market neutral
                The fund seeks to avoid any form of overall market exposure by utilising 'matching' long and short positions in different securities in the same market.

                Emerging market
                The fund invests primarily or exclusively in the securities of a developing country or group of developing countries.

                Merger arbitrage (risk arbitrage)
                The fund seeks to profit from opportunities arising from extraordinary corporate events such as M&A and Leveraged Buyouts (LBOs) by taking appropriate positions in the securities associated with the event. (see Event driven).

                Event driven (special situation)
                The fund seeks to exploit pricing inefficiencies that may occur before or after a corporate event, such as a bankruptcy, merger, acquisition, or spinoff. (see Merger arbitrage).

                Statistical arbitrage
                Typically the fund trades pairs (or larger baskets) of stock that its quant models show as having a fairly persistent relationship statistically, shorting the relatively overpriced stock and buying the relatively underpriced stock and profiting from the anticipated convergence.

                Quantitative
                The fund selects investments and may also execute the trading decision based on quantitative models.

                Dividend arbitrage
                The fund seeks to profit from dividend-paying stocks by holding the relevant stock through the exdividend date while hedging the long position in the stock with in-the-money put options.

                Balanced
                A traditional fund that combines a stock component and fixed income component, allowing the fund to switch between a moderate risk weighting (more equity) and a conservative (more fixed income) weighting.

                Convertible bond arbitrage
                The fund seeks to profit on any mispricing between a convertible bond and its underlying stock.

                Fixed income arbitrage
                The fund seeks to profit from temporary pricing mismatches between related securities by taking 'off-setting' long and short positions, often with leverage, while limiting exposure to interest rate changes.

                Distressed securities
                The fund seeks to profit from holding securities trading at a discount to par value in firms experiencing financial or operational distress, bankruptcy etc., often by trying to influence the process of restructuring.

                Volatility arbitrage
                The fund seeks to profit from volatility changes in market indices or individual name securities, without being affected by the direction of the price movement.

                Global macro
                The fund implements opportunistic trading strategies to profit from shifts in macroeconomic trends.

                Multi-strategy
                Typically the fund is organised as separate trading groups, each specialising in a specific investment strategy, with fund capital being allocated dynamically across strategies depending on the expected investment opportunities.
                EX11.
                EX12.
                EX13.

                Section 4: Management and Operation of the Fund

                EX14. You should confirm whether or not the Fund Manager's personnel responsible for managing the fund have relevant and up-to-date experience in managing such funds.
                EX15. Please provide details regarding the minimum amount which an investor can invest into the fund.
                EX16. In relation to the Custody of the Fund Property, please confirm compliance with the applicable requirements in CIR 12A.3.1.
                EX17. Please confirm the frequency of the Net Asset Valuation (NAV) calculation.
                EX18. Please advise which of the fee structures are applicable to the fund's investors. Multiple fee structures may apply.
                EX19. The fund manager has a duty to act in the best interests of the Unitholders and, if there is a conflict between the Unitholders' interests and its own interests, to give priority to the Unitholders' interests. On this basis please provide details of any particular risk areas in which potential conflicts may arise and how the firm intends to disclose and manage such conflicts with Unitholders.
                EX20. If you have been granted any waivers or modifications of the DFSA Rules prior to submitting this form please provide the Notice number. Please note that this notification will not be accepted until any policy issues and waivers/modifications are resolved.

                Section 5: Parties to the Fund

                Please provide details regarding any third parties who may provide a service to the fund by way of delegation or outsourcing arrangement. Where relevant details should include name, address, regulatory status and whether an agreement is in place. These agreements are not required to be submitted to the DFSA as part of this application. However such agreements should be ready for inspection should the DFSA request sight of them.

                Section 6: Compulsory Supporting Documents for a Fund

                EX21. Please confirm you have attached the Constitution of the Fund.
                EX22. Please confirm you have attached the Information Memorandum of the Fund.

                Section 7: Fees for a Domestic Fund (Initial Annual Fee)

                Details of fees can be found in the Fees module of the DFSA Rulebook.

                Section 8: Disclosure

                This section should be completed by all applicants.
                [Added][VER6/08-14]

            • AFN AUT-NOTES Part 6: External Fund Manager Form notes

              Click here to download the notes in PDF FormatPDF Format.

              This section contains information to assist you to complete the External Fund Manager form. Each note relates to a question in the External Fund Manager form e.g. EM5 below provides information to assist you in completing the question at EM5 of the External Fund Manager form.

              Section 1: Declaration

              This section should be completed by all applicants.

              Section 2: Additional Declaration for an External Fund Manager

              This section should be completed by all applicants applying as an External Fund Manager and by either the Appointed Fund Administrator or Appointed Trustee.

              Section 3: General Information

              EM1. Please provide the full name of the firm applying as an External Fund Manager.
              EM2. We are seeking information about the legal nature of your Firm. Please refer to GEN Rule 7.2.2.
              EM3.
              EM4.
              EM5. You will need to give details of any trading name(s) which you propose to use for the purpose of, or in connection with, any business carried out in or from the DIFC, if these are different from your legal name.
              EM6.

              Section 4: Contact details

              EM7. You need to give the full address of the current place of business in your jurisdiction.
              EM8. You need to give the registered address for the operation in your jurisdiction
              EM9. The contact person named should be the person who is responsible for the application during this process and who will liaise with the DFSA. This person must be a representative of the company. It may be helpful to provide a second contact name as a back-up.
              EM10. If you do not have an adviser assisting you with this application, please go to question EM12.
              EM11. You may have a professional adviser assisting you with this application. Please tick yes if the DFSA should copy correspondence in relation to this application to the adviser.
              EM12. State the name of your auditor, their address, the relevant contact person, telephone number and fax number.

              Section 5: Regulatory Details

              EM13. Give the name of the supervisory contact person from the relevant regulator including postal address, telephone number, fax number and e-mail address.
              EM14.
              EM15. We need this information to determine that you have the equivalent authorisation/license in your jurisdiction to manage a collective investment fund in the DIFC.
              EM16.

              Section 6: Nature of Applicant's Business and intended activities in the DIFC

              EM17. The DFSA will review the proposed activities to ensure that they are within the scope of an External Fund Manager of a DIFC domiciled fund as set out in the Collective Investment Rules Module (CIR) of the DFSA Rulebook. Please describe what systems and controls the firm will have in place to ensure it conducts the activities of a Fund Manager which is managing a domestic fund.
              EM18. The following provides a brief summary regarding the structure of funds expressed in the form:

              IC (Investment company)
              GLO definition: An open or closed ended company established for the sole purpose of collective investment which is incorporated under the DIFC Companies Law in accordance with the Regulations made under that Law.

              IP (Investment partnership)
              GLO definition: A limited partnership established for the sole purpose of collective investment which is formed and registered under the Limited Partnership Law 2006 in accordance with the Regulations made under that Law.

              IT (Investment trust)
              GLO definition: An express trust created solely for collective investment purposes under the Investment Trust Law 2006.
              EM19.
              EM20. Please refer to COB Rule 2.3 of the DFSA Rulebook in relation to the definitions for types of clients.

              Section 7: Documentation for an External Fund Manager

              EM21. If you are unable to attach a letter of good standing from your regulator regarding your application, you must arrange for it to be sent directly to the DFSA by your regulator prior to submission of this application. Otherwise DFSA will not be able to accept submission of your application.
              EM22.
              EM23. An External Fund Manager must be subject to regulation by a financial services regulator in a Recognised Jurisdiction or otherwise acceptable to the DFSA with respect to managing a collective investment fund. You should refer to the DFSA's Recognised Jurisdiction Notice on the DFSA website. If your jurisdiction does not appear on this Notice you will be required to demonstrate to the DFSA that you are from an acceptable jurisdiction. In order to do so you are required to carry out a comparative analysis of your jurisdiction's regulated fund regime against that of the DFSA and highlight where any gaps exist. Where such gaps exist you should also demonstrate controls you intend to implement to match DFSA requirements. As part of your submission you should provide the comparative analysis including gaps and remedies.
              EM24. Please see CIR 6.1.3 regarding the appointment of a Fund Administrator or Trustee as agent of an External Fund Manager. Please note the agreement must contain the information regarding the type of powers being granted to the agent to facilitate the External Fund Manager in relation to its dealings with the DFSA and Unitholders and prospective Unitholders such as:
              •   If it is an open-ended Fund, the issue, resale and redemption of the Units of the Fund and the publication of the price at which such issue, resale or redemption will occur as provided under the Law and the Rules;
              •   The sending to Unitholders of the Fund of all the reports required under the Law and the Rules;
              •   Access to the Constitution and most recent Prospectus of the Fund to Unitholders and Prospective Unitholders;
              •   Access to the Unitholder register; and
              •   Access to the books and records relating to the Fund as required by the DFSA and any person providing the oversight functions of the Fund,
              in or from a place in the DIFC.
              EM25. Please refer to the notes in EM24.

              Section 8: Compulsory Supporting Documents for a Fund Manager

              The documents required in this section can be self-certified by all firms. Be aware that you may still be asked to supply all, or any, of the documents as part of the application.
              EM26. Compliance manual
              The manual should ensure compliance with the relevant DFSA Rules.
              EM27. Anti-money laundering procedures
              Your anti-money laundering procedures should include, amongst other things, arrangements to:
              •   Ensure compliance with UAE Law No 4 and any other relevant UAE federal laws.
              •   Ensure compliance with the DFSA's Anti-Money Laundering, Counter-Terrorist Financing and Sanctions Module (AML).
              EM28. Compliance monitoring programme
              Your programme should document how compliance is monitored within the business units.
              EM29. Risk management policies
              Your policy document should describe the risk management arrangements you will establish and maintain to identify, assess, mitigate, control and monitor the risks arising from the Financial Services activities carried out in or from the DIFC. Such arrangements should also take into account the Funds for which you are acting as the Fund Manager.

              Section 9: Fit and Proper Questionnaire

              EM30-36. These questions are self-explanatory and are focused on the fitness and propriety of the firm. Please supply all relevant information - openness and honesty are essential. Should we need to examine your application more closely because of any disclosures you make, this will not necessarily count against you. However, deliberately withholding information or providing false or misleading information will adversely impact the success of your application. If in doubt, disclose.

              Section 10: Disclosure

              This section should be completed by all applicants.
              [Added][VER6/08-14]

            • AFN AUT-NOTES Part 7: External Fund Notification Form notes

              Click here to download the notes in PDF FormatPDF Format.

              This section contains information to assist you to complete the External Fund Notification form. Each note relates to a question in the notification form e.g. EX5 below provides information to assist you to complete the question at EX5 of the External Fund Notification form.

              Section 1: Declaration

              This section should be completed by all applicants.

              Section 2: Contact details

              EX1. Please provide the full name of the Fund Manager.
              EX2. The contact person named should be the person who is responsible for the application during this process and who will liaise with the DFSA. This person must be a representative of the company. It may be helpful to provide a second contact name as a back-up.
              EX3. If you do not have an adviser assisting you with this application, please go to question EX5.
              EX4. You may have a professional adviser assisting you with this application. Please tick yes if the DFSA should copy any correspondence in relation to this application to the adviser.

              Section 3: External Fund Structure and Investment Policy

              EX5. Please provide the full name of the Fund.
              EX6. Fund Structure.
              Please tick the applicable boxes. Multiple boxes may be used for any one fund if applicable. The following provides a brief summary regarding the structure of funds expressed in the form:

              Investment company
              GLO definition: An open or closed ended company established for the sole purpose of collective investment which is incorporated under the DIFC Companies Law in accordance with the Regulations made under that Law.

              Investment partnership
              GLO definition: A limited partnership established for the sole purpose of collective investment which is formed and registered under the Limited Partnership Law 2006 in accordance with the Regulations made under that Law.

              Investment trust
              GLO definition: An express trust created solely for collective investment purposes under the Investment Trust Law 2006.

              Other
              Please specify if your fund is not an investment company, investment partnership or investment trust i.e. it may be a Unit Trust in the UK.

              Master Fund
              See CIR 3.1.4

              Feeder Fund
              See CIR 3.1.5

              Umbrella fund
              See CIR 3.1.10.
              EX7. Type of Fund.
              Please tick the applicable boxes. Multiple boxes may be used for any one fund if applicable. The following provides a brief summary regarding the types of funds expressed in the form:

              Traditional
              Essentially the same as a standard mutual fund, such a fund is long-only, unleveraged, with returns driven largely by the performance of the market or an asset class and with no performance-based fees.

              Private equity
              A fund investing in an asset class consisting of equity securities and, to a lesser extent, debt in operating companies that are not publicly traded on an exchange

              Money market
              A Fund that invests in short-term (less than one year) debt securities such as T-bills, CDs and commercial paper.

              REIT
              See CIR 3.1.8

              Islamic
              See CIR 3.1.2

              Hedge fund
              See CIR 3.1.9

              Fund of funds
              See CIR 3.1.3

              ETF
              A fund containing a portfolio designed to replicate the performance of a major index or benchmark, capable of being traded like any other exchange-traded security throughout the trading day.

              CTA
              Essentially, a hedge fund specialising in using futures, options on futures, and forwards to implement their investment strategy.

              Index tracker
              A fund designed to replicate the performance of an index or benchmark (compare ETF).

              Venture capital
              A private equity fund investing in start-up and (generally) small businesses with significant growth potential and characterised as being high-risk/high-return opportunities.

              Real Property (Real Estate)
              See CIR 3.1.7

              Managed currency
              A fund seeking to profit from considered investments in foreign exchange.
              EX8. Asset classes invested into by the Fund.
              Please tick the applicable boxes. Multiple boxes may be used for any one fund if applicable. The following provides a brief summary regarding the asset classes expressed in the form:

              Equities (Shares)
              Shares of ownership in publicly held companies. See GEN A2.1.1 (a)

              Property (Real estate)
              GLO definition: Land or buildings, whether freehold or leasehold, where the unexpired term of any lease exceeds 20 years.

              Money market investments (Bills/Notes/Commercial Paper etc.)
              Liquid, short-term, fixed income securities issued by governments or firms

              Government bonds
              Fixed income securities issued by governments

              Futures/options
              For definitions see GEN A2.3.1

              Infrastructure
              Basic physical systems and businesses such as water, power, transport systems, communication systems

              Credit incl. corporate bonds
              Fixed income securities and loans issued by corporations

              Microfinance
              As an asset class, investments are generally made in microfinance institutions (MFIs) which in turn make micro-loans to new businesses in the developing world.
              EX9. Investment strategy used by the Fund.
              Please tick the applicable boxes. Multiple boxes may be used for any one fund if applicable. The following provides a brief summary regarding the investment strategies expressed in the form:

              Long-only
              The fund holds only 'long' positions in assets and securities

              Long-short
              The fund holds long positions in securities it expects to increase in value and short positions in securities (in the same asset class as the long positions) which it expects to decrease in value or to hedge the long positions against general market exposure.

              Short bias
              The fund maintains a net short exposure to the market through a combination of short and long positions.

              Market neutral
              The fund seeks to avoid any form of overall market exposure by utilising 'matching' long and short positions in different securities in the same market.

              Emerging market
              The fund invests primarily or exclusively in the securities of a developing country or group of developing countries.

              Merger arbitrage (risk arbitrage)
              The fund seeks to profit from opportunities arising from extraordinary corporate events such as M&A and Leveraged Buyouts (LBOs) by taking appropriate positions in the securities associated with the event. (see Event driven).

              Event driven (special situation)
              The fund seeks to exploit pricing inefficiencies that may occur before or after a corporate event, such as a bankruptcy, merger, acquisition, or spinoff. (see Merger arbitrage).

              Statistical arbitrage
              Typically the fund trades pairs (or larger baskets) of stock that its quant models show as having a fairly persistent relationship statistically, shorting the relatively overpriced stock and buying the relatively underpriced stock and profiting from the anticipated convergence.

              Quantitative
              The fund selects investments and may also execute the trading decision based on quantitative models.

              Dividend arbitrage
              The fund seeks to profit from dividend-paying stocks by holding the relevant stock through the exdividend date while hedging the long position in the stock with in-the-money put options.

              Balanced
              A traditional fund that combines a stock component and fixed income component, allowing the fund to switch between a moderate risk weighting (more equity) and a conservative (more fixed income) weighting.

              Convertible bond arbitrage
              The fund seeks to profit on any mispricing between a convertible bond and its underlying stock.

              Fixed income arbitrage
              The fund seeks to profit from temporary pricing mismatches between related securities by taking 'off-setting' long and short positions, often with leverage, while limiting exposure to interest rate changes.

              Distressed securities
              The fund seeks to profit from holding securities trading at a discount to par value in firms experiencing financial or operational distress, bankruptcy etc., often by trying to influence the process of restructuring.

              Volatility arbitrage
              The fund seeks to profit from volatility changes in market indices or individual name securities, without being affected by the direction of the price movement.

              Global macro
              The fund implements opportunistic trading strategies to profit from shifts in macroeconomic trends.

              Multi-strategy
              Typically the fund is organised as separate trading groups, each specialising in a specific investment strategy, with fund capital being allocated dynamically across strategies depending on the expected investment opportunities.
              EX10.
              EX11.
              EX12.

              Section 4: External Fund Requirements

              EX13. This is the jurisdiction in which you have established the fund.
              EX14. Please specify the name of the relevant fund laws, rules, regulations which are applicable to the fund in its jurisdiction. This should also include the fund category i.e. exempt fund, public fund, etc.
              EX15. Please advise whether you are allowed to target retail clients to invest in the fund in its jurisdiction.
              EX16. Please advise what AML legislation applies to the fund in your jurisdiction. As an example for DIFC domestic fund this would be the AML Module of the DFSA Rulebook.
              EX17. Please advise whether the jurisdiction in which the fund is domiciled complies with the Financial Action Task Force (FATF) Recommendations. These Recommendations are used as the international standard.
              EX18. The contact person named should be the person who is responsible for the regulatory authorisation and ongoing supervision of the fund.
              EX19. Please confirm which entities will distribute the fund.
              EX20. The Fund Manager of an External Fund must:
              (c) Have systems and controls which are adequate to ensure compliance with the requirements that apply to the External Fund in the jurisdiction in which it is established or domiciled; and
              (d) Inform the DFSA of the jurisdiction in which the Fund is or is to be established or domiciled and the nature of regulatory requirements applicable to the Fund in that jurisdiction.
              A Fund Manager of an External Fund is generally not subject to the requirements that otherwise apply to Domestic Funds (see Article 14(2) of the Law). However, some limited requirements apply to External Funds. See for example the disclosure required under Rules 14.2.414.2.7. Should such a requirement conflict with any requirements that apply to an External Fund in the jurisdiction in which the Fund is domiciled, the Fund Manager may apply to the DFSA for appropriate waivers or modifications of the DFSA requirements.

              The DFSA may upon receipt of the information referred to in Rule 6.2.2(b), assess the desirability of establishing an External Fund in that particular jurisdiction chosen by the Fund Manager. Relevant considerations include:
              (d) The Fund Manager's need to establish the Fund in the particular jurisdiction for reasons such as the physical location of the Fund assets or investor preference;
              (e) Any regulatory risks arising from establishing the External Fund in the relevant jurisdiction, particularly if the Fund is to be open to retail investors; and
              (f) Whether the relevant jurisdiction complies with the FATF or other relevant international standards or requirements.
              EX21. If you have been granted any waivers or modifications of the DFSA Rules prior to submitting this form please provide the Notice number. Please note that this notification will not be accepted until any policy issues and waivers/modifications are resolved.

              Section 5: Parties to the Fund

              Please provide details of any third parties who may provide a service to the fund by way of delegation or outsourcing arrangement. Where relevant, details should include name, address, regulatory status and whether an agreement is in place. These agreements are not required to be submitted to the DFSA as part of this application. However such agreements should be ready for inspection should the DFSA request sight of them.

              Section 6: Compulsory Supporting Documents for a Fund

              EX22. Please confirm you have attached the Information Memorandum of the Fund.

              Section 7: Disclosure

              This section should be completed by all applicants.
              [Added][VER6/08-14]

            • AFN AUT-NOTES Part 8: Representative Office form notes

              Click here to download the notes in PDF FormatPDF Format.

              Representative Office form notes

              Each note below relates to a question or statement in the Representative Office Application form. E.g. RO1 provides information to help you to complete question RO1 in the Representative Office Application form.

              General Information notes

              RO1. Please provide the full name of the firm applying to be licensed as a Representative Office
              RO2. We want information about the legal nature of your firm. Please refer to GEN Rule 7.2.2GEN Rule 7.2.3.
              RO3. Please provide details of the head office (telephone, fax, e-mail and website address)
              RO4. Please provide date and place of incorporation for the head office.
              RO5. Your financial year-end will be used to determine the regulatory reporting requirements.
              RO6. You will need to give details of any trading name(s) which you propose to use for the purpose of, or in connection with, any business carried out in or from the DIFC, if these are different from your legal name.
              RO7. The contact person named should be the person who is responsible for the application during the authorisation process and who will liaise with the DFSA. This person must be a representative of the company. It may be helpful to provide a second contact name as back-up.
              RO8. You may have a professional adviser assisting with the application process.
              RO9. Please tick “yes” to question if the DFSA should copy correspondence in relation to this application to the adviser.

              Home jurisdiction regulator

              RO10. Give the name of the supervisory contact from the relevant regulator including postal address, telephone number, fax number and e-mail address.

              Controllers

              RO11. Please refer to GEN Rule 11.8.3 for the definition of Controller.

              Nature of applicant's business and intended activities in the DIFC

              RO12. The DFSA will review the proposed activities to ensure that they are within the scope of a Representative Office as defined in Representative Office Module of the DFSA Rulebook. Please describe what systems and controls the firm will have in place to ensure it only conducts the activities of a Representative Office.

              Anti Money Laundering

              RO13. Please consult chapter 6 of the Representative Office Module (REP) of the DFSA Rulebook before confirming that appropriate arrangements are in place.

              Principal Representative

              RO14. Please complete form AUT-IND4 for the individual proposed as the Principal Representative.

              Fees

              For comprehensive details of fees, please refer to the Fees module of the DFSA Rulebook.

              Applicant Firm Fit & Proper Questionnaire and declaration

              RO15/ RO20 These questions are self-explanatory and are focused on the fitness and propriety of the firm. If you answer yes to any question please supply all relevant information - openness and honesty are essential. Should we need to examine your application more closely because of any disclosures you make, this will not necessarily count against you. However, deliberately withholding information or providing false or misleading information, will adversely impact the success of your application. If in doubt, disclose.
              [Amended][VER23/04-11]
              [Amended][VER6/08-14]

            • AFN AUT-NOTES Part 9: Credit Rating Agency form notes

              Click here to download the notes in PDF FormatPDF Format.

              Each note below relates to a question or statement in the Credit Rating Agency application form. E.g. CR1 provides information to help you to complete question CR1 in the Credit Rating Agency application form.

              General Information notes

              CR1. Provide the full name of the firm applying to be licensed as a Credit Rating Agency.
              CR2. Provide details of any trading name(s) which you propose to use for the purpose of, or in connection with, any business carried out in or from the DIFC, if these are different from your legal name.
              CR3. Provide information about the legal nature of your firm. Please refer to GEN Rule 7.2.2.
              CR4. Specify whether the applicant applying to be licensed is incorporated inside or outside the DIFC (i.e. a branch).
              CR5. To be completed only where the applicant is incorporated outside of the DIFC (i.e. a branch).
              CR6. Provide the name of the supervisory contact from the relevant regulator including postal address, telephone number, fax number and e-mail address.
              CR7. Provide details for the applicant's office in the DIFC including address, telephone, fax, email and website.
              CR8. Provide the applicant's financial year end.
              CR9. State the name of your auditor, their address, the relevant contact person, telephone number and fax number. For Domestic Firms the auditor must be an auditor registered with the DFSA in accordance with GEN Chapter 8.
              CR10. The contact person named should be the person who is responsible for the application during the authorisation process and who will liaise with the DFSA. This person must be a representative of the applicant.
              CR11. You may have a professional adviser assisting with the application process.
              CR12. Please tick "yes" to question if the DFSA should copy correspondence in relation to this application to the adviser.
              CR13. If you wish any of the DFSA Rules waived or modified you must submit the Form SUP 2

              Controllers

              CR14. Please refer to GEN Rule 11.8.3 for the definition of Controller.

              Corporate Governance

              CR15. The DFSA will review the proposed corporate governance structure to ensure that it is appropriate given the size, scope and nature of the applicant's proposed operations. Consideration should be given to the requirements in Chapter 5 of the General (GEN) Module and the guidance in Section 2-2 of the Regulatory Policy and Process (RPP) Sourcebook.

              Nature of applicant's business and intended activities in the DIFC

              CR16. The DFSA will review the proposed activities to ensure that they are within the scope of Operating a Credit Rating Agency as defined in GEN 2.27. Should the applicant intend to carry out any ancillary services consideration should be given COB 8.5.2.

              Compliance

              CR17/ CR21 The DFSA will review the proposed compliance framework and the arrangements described for ensuring compliance with the relevant COB requirements. Consideration should be given to the requirements in GEN 5.3.7 to 5.3.12 and Chapter 8 of the Conduct of Business (COB) Module.

              Documentation

              CR22. Organogram of group structure identifying all Controllers, ultimate beneficial owners, other shareholders and Close Links. Include a clear breakdown of percentage shareholding sizes, jurisdiction in which the entity/individual is based, identification of any other regulated entities and each entity's principal activity. Where shares are held by a trust, you must also provide details of all trustees, settlors and beneficiaries.
              CR23. Organogram of legal entity including reporting lines to demonstrate separation of functions and independence of risk management/compliance/internal audit. The employee organogram should identify the senior management / head functions with significant influence and any reporting lines to the Governing Body. Please ensure that the Compliance Officer has access to both the Senior Executive Officer and board of Directors.
              CR24. Provide a copy of the applicant's most recent audited accounts. Where the applicant is yet to be established, provide a copy of its parent's most recent audited accounts.
              CR25. All Credit Rating Agencies must nominate a suitable individual to carry out the mandatory licensed function of Senior Executive Officer.
              CR26. All Credit Rating Agencies must nominate a suitable individual to carry out the mandatory licensed function of Compliance Officer. If the nominated Compliance Officer is not resident in the UAE, the applicant must also submit an SUP2 form applying for a waiver of GEN 7.5.2. In such cases, the applicant must demonstrate that it has sufficient resources and appropriate compliance oversight arrangements for the DIFC operation.
              CR27. An SUP2 form is only required where the applicant wishes to apply to have any of the DFSA Rules waived or modified.

              Fees

              For comprehensive details of fees, please refer to the Fees module of the DFSA Rulebook.

              Applicant Firm Fit & Proper Questionnaire and declaration

              CR28/ CR34 These questions are self-explanatory and are focused on the fitness and propriety of the firm. If you answer yes to any question please supply all relevant information - openness and honesty are essential. Should we need to examine your application more closely because of any disclosures you make, this will not necessarily count against you. However, deliberately withholding information or providing false or misleading information, will adversely impact the success of your application. If in doubt, disclose.

              [Added][VER6/08-14]

            • AFN AUT-NOTES Part 10: Other information

              Click here to download the notes in PDF FormatPDF Format.

              Becoming Authorised

              In order to conduct Financial Services through the Dubai International Financial Centre, individuals or entities need to seek authorisation from the DFSA. Authorisation is given in the form of a Licence which is issued by the DFSA, which specifies the type of Financial Services that can be conducted.

              The following is a guide for firms seeking authorisation from the DFSA:

              Tips for applicants

              1. Spend time preparing your application. Read the GEN module of the DFSA Rulebook, as well as the guidance notes to the application forms before you start your application.
              2. Carefully identify which of your proposed business activities fall within the definition of Financial Services. Check whether there are any exemptions or prohibitions which may impact your application.
              3. If you are a start-up firm, review our policy statement on start-ups. This can be found on the DFSA website under Legislation. We do not accept applications for start-up banks.
              4. Check you are submitting the most-up-to date version of our application form(s) and that you have used the right forms for the business activities you are proposing. Ensure your application specifies clearly the Financial Services you intend to carry out.
              5. Be as comprehensive as possible in providing the information required. Make sure your forms are signed and that you have included the required attachments.
              6. Review your application before submission, particularly when using consultants or legal advisers. You are the one who knows your business best and you are responsible for all information contained in the application.
              7. Provide one hard copy and one soft copy of your application. The soft copy should be stored on a CD or memory stick. Please do not send e-mail copies.
              8. Ensure you have paid the correct application fee. Details of the fee schedule are set out in the Fees module of the DFSA Rulebook. We will only commence work on your application when payment and the original application form(s) have been received.
              9. Nominate a contact person within your firm to be responsible for managing the application process and to assist the DFSA with any enquiries.
              10. Initiate the Registrar of Companies process at the same time as lodging your application with the DFSA. This will save you time at the end of the process.

              How we assess applications

              Before we can authorise a firm as an Authorised Firm, we need to be satisfied that the firm meets our Fit and Proper test, and is likely to do so on an ongoing basis. Generally, Fit and Proper means the ability to carry out a financial service competently, with honesty and integrity.

              The areas we look at include:

              •   Legal status: A firm must be a body corporate or partnership. It can be formed in the DIFC, or a firm can establish a branch of a legal entity based in another jurisdiction. In the latter instance, the DFSA would expect the outside jurisdiction to have internationally compliant regulatory and legal standards.
              •   Location of offices: A firm must carry on its activities from a place of business in the DIFC. Please discuss office requirements with the DIFC Authority Business Development Unit.
              •   Ownership and group structure: The DFSA seeks to establish that it will be able to effectively supervise the firm. Therefore we need to be made aware of any Close Links (eg parent, subsidiary, sister company) which could hinder effective ongoing supervision.
              •   Adequate resources: A firm must have adequate resources to carry out the proposed financial services including financial resources and adequate systems and controls. A firm must have an internal audit function.
              •   Senior management: A firm must appoint a Senior Executive Officer, a Compliance Officer, an Anti-Money Laundering Reporting Officer and a Finance Officer. The first three positions require the individuals responsible to be resident in the UAE. As part of our process, we will evaluate the competence and integrity of the proposed senior management team.

              How to prepare to apply

              We strongly recommend that firms, in the first instance, engage with the Business Development unit of the DIFCA. They will help you understand the value proposition of the DIFC to assist your evaluation of whether a presence here will make business sense for your firm.

              Some firms go straight to attempting to complete the application forms. This often results in a poor application and can lengthen the application process. Here are some recommended preparation steps:

              •   Decide what type of business you want to carry out and check which Financial Services you will need to apply for.
              •   Determine who will be part of the senior management and who will be in the mandatory positions. Prepare to complete the necessary individual application forms.
              •   Develop a comprehensive regulatory business plan that sets out your proposed activities, 3-year financial projections and budget, resources such as human, systems and financial. This can be shared with the DFSA Authorisation Enquiries team who will be happy to comment on your proposal.
              •   Familiarise yourself with the applicable rules from the DFSA Rulebook and be prepared to show how you will comply with those rules. This will include providing a compliance manual, a compliance monitoring programme, and risk management policies.
              •   Determine your minimum regulatory capital requirements, with which you will need to comply at all times. This should be included in your 3-year financial projections.

              Completing the Application Forms

              It is vital that you supply all relevant information. Openness and honesty are essential. Should we need to examine your application more closely because of any disclosures you make, this will not necessarily count against you. However, deliberately withholding information or providing false or misleading information, will adversely impact the success of your application. If in doubt, disclose.

              If the information you provide is inaccurate or incomplete, we may deem your application as materially incomplete, in which case it would not be accepted. Thus, missing information will lengthen the application process. Ensure that all relevant documents are also included with your completed application.

              You should also start the registration process with the DIFC Registrar of Companies at the same time as you submit your DFSA application. This will help you to avoid delays at the end of the authorisation process.

              Fees

              The application fee will vary according to the Financial Services to be provided. Comprehensive details of fees can be found in the Fees module (FER) of the DFSA Rulebook.

              Authorisation timeline

              If the application is complete and the application fee has been paid, we will process the application according to the following timeline:

              •   Within 2 business days of receipt of the application: A letter acknowledging receipt of the application is sent.
              •   Within 10 business days of receipt of the application: We aim to send out an initial review letter.
              •   Dialogue between you and the DFSA will start and continue as required to the final review.
              •   Within 4 months of receipt of the application: We aim to complete a final review and recommendation.

              The timeline set out above is indicative only. The time taken to process your application will depend on its scale and complexity, as well as the timely submission of information and response to any requests for further clarification. The need to make the correct regulatory decision will always take precedence over meeting target timescales.

              A successful application will result in the DFSA issuing you an in-principle letter which will allow you to complete the DIFC Registrar of Companies process. We will then issue your DFSA Licence once you can demonstrate that you have successfully registered with the Registrar of Companies, opened a bank account and sufficiently capitalised the firm (for DIFC entities only) and met any other outstanding matters.

              You will have only 3 months to complete the outstanding requirements and establish operational premises during the in-principle period. It will be helpful if you can establish contact with any other relevant third parties eg Registrar of Companies, bank etc at the same time as submitting your DFSA application.

              Getting help

              •   DFSA Rulebook: Generally applicable modules include: General (GEN) and Conduct of Business (COB).
              •   Authorisation Enquiries: You can direct your questions regarding our regulatory regime or the authorisation process to Authorisation Enquiries.
              •   DIFCA Business Development Manager: For advice on the commercial aspects of setting up in the DIFC and for copies of the application forms.
              [Amended][VER23/04-11]
              [Amended][VER6/08-14]

          • AFN AUT–CORE Applying for Authorisation — Core Information Form

            Click here to download the form in Word FormatWord Format. For notes to assist you in completing this form please refer to AUT-NOTES.

          • AFN AUT–AMS Applying for Authorisation — Asset Management Supplement

            Click here to download the form in Word formatWord format. For notes to assist you in completing this form please refer to AUT-NOTES.

          • AFN AUT–STS Applying for Authorisation — Sales and Trading Supplement

            Click here to download the form in Word formatWord format. For notes to assist you in completing this form please refer to AUT-NOTES.

          • AFN AUT–BLS Applying for Authorisation — Banking and Lending Supplement

            Click here to download the form in Word formatWord format. For notes to assist you in completing this form please refer to AUT-NOTES.

          • AFN AUT–INS Applying for Authorisation — Insurance Supplement

            Click here to download the form in Word formatWord format. For notes to assist you in completing this form please refer to AUT-NOTES.

          • AFN AUT–IFS Applying for Authorisation — Islamic Finance Business Supplement

            Click here to download the form in Word formatWord format. For notes to assist you in completing this form please refer to AUT-NOTES.

          • AFN AUT–PFS Applying for Authorisation — Public Fund supplement

            Click here to download the form in Word formatWord format. For notes to assist you in completing this form please refer to AUT-NOTES.

          • AFN AUT–EFF Applying for Authorisation — Exempt Fund Form

            Click here to download the form in Word FormatWord Format. For notes to assist you in completing this form please refer to AUT-NOTES.

          • AFN AUT–QIF Qualified Investor Fund: Notification Form

            Click here to download the form in Word FormatWord Format.

          • AFN AUT–REP Applying for Authorisation as a Representative Office

            Click here to download the form in Word FormatWord Format. For notes to assist you in completing this form please refer to AUT-NOTES.

          • AFN AUT–CON Applications and Notifications Concerning a Change in Control

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be submitted by an Authorised Firm applying for approval or notifying the DFSA concerning a change in control of the Authorised Firm, this form may also be used by a Controller.

            Authorised Firms are required to complete a form for each application or notification.

            An Authorised Firm or Controller must submit an application or notification. As applicable, concerning a change in control, at least 28 days in advance of the proposed change, or immediately upon becoming aware of a proposed or actual change in control.

            Contents

            Section Title
            1 Controllers (Individuals)
            2 Controllers (Undertakings)
            3 Details of new controls or change in level of control
            4 Additional information
            5 Declaration

            Notes for completing this form

            •  Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •  Section 1 must be completed if the application/notification of a change in control relates to an individual.
            •  Section 2 must be completed if the application/notification relates to an Undertaking.
            •  Section 3 and 5 must be completed in respect of all applications/notifications.
            •  Please use Section 4 if you wish to provide additional information that may clarify or support your answers in Sections 1–3.
            •  Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
            •  Answers must be typed in electronic format and the form must be signed by the Authorised Firm's Senior Executive Officer, Compliance Officer or relevant Controller.

          • AFN AUT–IND1 Authorised Individual Status

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

          • AFN AUT–IND2 Application to Extend or Vary Authorised Individual Status

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be submitted by an Authorised Firm applying to extend or vary an Authorised Individual's authorised status. In some cases the DFSA may require additional information (including the re-submission of a complete form AUT–IND1 (Application for authorisation Authorised Individual Status) in order to complete the processing of this application. If this is necessary, the DFSA will contact the person identified in section 1 of this form.

            If the Authorised Individual will cease to perform any Licensed Functions, Form AUT–IND3 (Application to Withdraw Authorised Individual Status) should be submitted instead of this form.

            Contents

            Section Title
            1 General Information
            2 Changes to Licensed Functions
            3 New or additional Licensed Functions
            4 Fit & proper questionnaire
            5 Additional information
            6 Attachments
            7 Declarations

            Notes for completing this form

            •  Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •  Unless otherwise specified, applicant refers to the individual for whom Authorised Individual status is being sought.
            •  Unless otherwise specified, Authorised Firm refers to the firm on whose behalf the applicant will be carrying out the Licensed Functions and includes, for the purposes of this application, a firm applying for authorisation to carry on Financial Services.
            •  Prior to completion of this form, Authorised Firms should read the relevant sections of the GEN Module of the DFSA Rulebook applying to Authorised Individuals.
            •  Sections 1, 2, 4, 6 and 7 must be completed in all cases.
            •  Section 3 must be completed when making an application to perform one or more new Licensed Functions.
            •  Please use section 5 if you wish to provide additional information to clarify or support your answers in other sections of the form.
            •  Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
            •  Do not leave any questions blank. If a question is not applicable this should be indicated in the response section. Failure to answer questions or provide full responses will delay the progress of the application.
            •  Answers must be typed, in electronic format, and the form must be signed by a Director/Partner of the Authorised Firm.

          • AFN AUT–IND3 Application to Withdraw Authorised Individual Status

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be submitted by an Authorised Firm applying to withdraw an Authorised Individual's authorised status. In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary, the DFSA will contact the person identified in section 1 of this form.

            If the Authorised Individual will cease to perform one or more Licensed Functions but remain an Authorised Individual, Form AUT–IND2 (Application to Extend or Vary Authorised Individual Status) should be submitted instead of this form.

            Representative Offices

            If this form is being completed to withdraw a Principle Representative of a Representative Office please tick here.

            You will not be required to answer questions 1.1 and 2.1.

            The declaration in section 3 will need to be signed by a Director at the head office.

            Contents

            Section Title
            1 General information
            2 Licensed Functions
            3 Declarations

            Notes for completing this form

            •  Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •  Unless otherwise specified, applicant refers to the individual for whom Authorised Individual status is being withdrawn.
            •  Unless otherwise specified, Authorised Firm refers to the firm on whose behalf the application to withdraw Authorised Individual Status is being submitted.
            •  Prior to completion of this form, Authorised Firms should read the relevant sections of the GEN Module of the DFSA Rulebook applying to Authorised Individuals.
            •  All sections of the form must be completed.
            •  Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
            •  Do not leave any questions blank. If a question is not applicable this should be indicated in the response section. Failure to answer questions or provide full responses will delay the progress of the application.
            •  Answers must be typed, in electronic format, and the form must be signed by a Director/Partner of the Authorised Firm.

          • AFN AUT–IND4 Applying to become the Principal Representative

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

          • AFN AUT–IND 5 Application for authorisation Key Individual status

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be completed and submitted by both the Authorised Market Institution or an applicant for such a licence ("applicant firm") which wishes to appoint an individual to perform one or more Key Individual functions in AMI Rule 5.3.1(2), and the relevant individual ("applicant individual").

            Before submitting an application to the DFSA, the applicant firm must make all reasonable enquiries as to the individual's fitness and propriety to carry out the relevant Key Individual functions.

            In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary, the DFSA will contact the person identified as the applicant firm's relevant contact to obtain such additional information.

            An Authorised Market Institution applying to extend or vary the scope of an existing Key Individual's status should use form AUT-IND6 instead of this form.

            An Authorised Market Institution applying to withdraw an existing Key Individual's status should use form AUT-IND7 instead of this form.

            Contents

            Section Title
            1 General information
            2 Key Individual functions
            3 Education and professional qualifications
            4 Employment history
            5 Other personal registrations
            6 Professional memberships
            7 Other holdings
            8 Referees
            9 Fit and proper questionnaire
            10 Attachments
            11 Declarations

            Notes for completing this form

            •  Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •  Prior to completion of this form both the applicant firm and applicant individual should read the relevant sections of the AMI module, particularly section 5.3, which sets out the requirements relating to Regulatory Functions and Key Individuals.
            •  All sections of the form must be completed. Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
            •  Do not leave any questions blank. If a question is not applicable this should be indicated in the response section. Failure to answer questions or provide full responses will delay the progress of the application.
            •  Answers must be typed in electronic format and the form must be signed by a a member of the Governing Body of the applicant firm or, in the event that the applicant has yet to be incorporated, the Director who will be authorised in due course to sign on behalf of the applicant firm. This form must also be signed by the applicant individual. Versions of this form on the DFSA's website are in PDF format. Editable Microsoft Word versions can be obtained from the DFSA.

          • AFN AUT–IND 6 Application to extend or vary Key Individual status

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be submitted by an Authorised Market Institution applying to extend or vary a Key Individual's authorised status. In some cases the DFSA may require additional information (including the re-submission of a complete form AUT-IND5 (Application for authorisation of Key Individual status) in order to complete the processing of this application. If this is necessary, the DFSA will contact the person identified in section 1 of this form.

            If the Key Individual will cease to perform any Key Individual functions, Form AUT-IND7 (Application to Withdraw Key Individual Status) should be submitted instead of this form.

            Contents

            Section Title
            1 General information
            2 Changes to Key Individual functions
            3 New or additional Key Individual functions
            4 Fit & proper questionnaire
            5 Additional information
            6 Attachments
            7 Declarations

            Notes for completing this form

            •  Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •    Unless otherwise specified, applicant refers to the individual for whom Key Individual status is being sought.
            •    Unless otherwise specified, Authorised Market Institution refers to the Authorised Market Institution on whose behalf the applicant will be carrying out the Key Individual functions and includes, for the purposes of this application, an applicant for an Authorised Market Institution licence.
            •  Prior to completing this form, an Authorised Market Institution should read the relevant sections of the AMI module of the DFSA Rulebook applying to Key Individuals.
            •   Sections 1,2,4,6 and 7 must be completed in all cases.
            •    Section 3 must be completed when making an application to perform one or more new Key Individual functions.
            •    Please use section 5 if you wish to provide additional information to clarify or support your answers in other sections of the form.
            •   Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
            •  Do not leave any questions blank. If a question is not applicable this should be indicated in the response section. Failure to answer questions or provide full responses will delay the progress of the application.
            •  Answers must be typed, in electronic format, and the form must be signed by the Senior Executive Officer or Compliance Officer of the Authorised Market Institution who is duly authorised to do so. Versions of this form on the DFSA's website are in PDF format. Editable Microsoft Word versions can be obtained from the DFSA.

          • AFN AUT–IND 7 Application to withdraw Key Individual status

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be submitted by both an Authorised Market Institution applying to withdraw a Key Individual's status. In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary, the DFSA will contact the person identified in section 1 of this form.

            If the Key Individual will cease to perform one or more Key Individual functions but will remain a Key Individual, Form AUT-IND 6 (Application to Extend or Vary Key Individual Status) should be submitted instead of this form.

            Contents

            Section Title
            1 General information
            2 Key Individual function/s
            3 Declarations

            Notes for completing this form

            •  Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •    Unless otherwise specified, applicant refers to the individual for whom Key Individual status is being withdrawn.
            •    Unless otherwise specified, Authorised Market Institution refers to the firm on whose behalf the application to withdraw Key Individual status is being submitted.
            •  Prior to the completion of this form, the Authorised Market Institution should read the relevant sections of the AMI module of the DFSA Rulebook applying to Key Individual functions.
            •   All sections of the form must be completed.
            •   Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
            •  Do not leave any questions blank. If a question is not applicable this should be indicated in the response section. Failure to answer questions or provide full responses will delay the progress of the application.
            •  Answers must be typed, in electronic format, and the form must be signed by the Senior Executive Officer or Compliance Officer of the Authorised Market Institution who has the authority to sign this form.

          • AFN AUT–CRA Applying for Authorisation as a Credit Rating Agency

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            This form must be submitted by all new applicants applying for a Licence to conduct only the Financial Service of Operating a Credit Rating Agency, as defined in the GEN Module of the DFSA Rulebook.

            Should an applicant be applying for a Licence to conduct any other Financial Service in addition to Operating a Credit Rating Agency, it must complete the AUT CORE form and any relevant supplement.

          • Deleted forms

            • AFN AUT–INV [Deleted]

              Deleted March 2009 [VER13/03-01]

            • AFN AUT–INS [Deleted]

              Deleted March 2009 [VER13/03-01]

            • AFN AUT–TRU [Deleted]

              Deleted March 2009 [VER13/03-01]

            • AFN AUT–FAD [Deleted]

              Deleted March 2009 [VER13/03-01]

            • AFN AUT–ISL [Deleted]

              Deleted March 2009 [VER13/03-01]

            • AFN AUT–ISPV [Deleted]

              Deleted March 2009 [VER13/03-01]

        • [Deleted]

          [Deleted] July 18, 2013 [VER28/07-13]

          • AFN ASP1 [Deleted]

            [Deleted] July 18, 2013 [VER28/07-13]

          • AFN ASP2 [Deleted]

            [Deleted] July 18, 2013 [VER28/07-13]

          • AFN ASP3 [Deleted]

            [Deleted]

        • Chapter 3 — Chapter 3 — AFN SUP Forms

          • AFN SUP1 Reporting Return Coversheet

            Click here Click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

          • AFN SUP2 Application for a Waiver

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            An Authorised Firm wishing to apply for a waiver of a Rule must submit this form.

            Contents

            This form consists of six sections:

            1. Authorised Firm details
            2. Details of waiver sought
            3. Research and reasons
            4. Publication
            5. Additional information
            6. Declaration and signature

            Notes for completing this form

            •   Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •   Sections 1, 2, 3, 4 and 6 must be completed.
            •   Please use section 5 if you wish to provide additional information that may clarify or support your answers in sections 1–4.
            •   Questions must be fully answered and the use of abbreviations should be avoided.
            •   Answers must be typed and the form must be signed by either the Authorised Firm's Senior Executive Officer or Compliance Officer.
            •   Please ensure any supporting documentation is clearly labelled and securely attached.
            •   When completed, submit this application form in line with GEN section 11.2. You may send applications by post or hand delivered and addressed to your usual supervisory contact.

            The address for postal submission is:

            DUBAI FINANCIAL SERVICES AUTHORITY
            AUTHORISATION DEPARTMENT
            LEVEL 13, THE GATE
            PO BOX 75850
            DUBAI, UAE
            •   You can inspect published waivers on the DFSA website: www.dfsa.ae

          • AFN SUP3 Application for approval for a Cell of a Protected Cell Company—Insurance

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            An Authorised Firm wishing to apply for an additional Cell must submit this form.

            Contents

            This form consists of nine sections:

            1 Authorised Firm details
            2 Ownership details
            3 Insurance business
            4 General
            5 Additional information
            6 Money Laundering declaration
            7 Declaration and signature
            8 Attachments

            Notes for completing this form

            •  Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA Rulebook.
            •  Sections 1, 2, 3, 4, 6 and 7 must be completed.
            •  Please use section 5 if you wish to provide additional information that may clarify or support your answers in sections 1–4.
            •  Questions must be fully answered and the use of abbreviations should be avoided.
            •  Answers must be typed and the form must be signed by the Authorised Firm's Senior Executive Officer.
            •  Please ensure any supporting documentation is clearly labelled and securely attached.
            •  When completed, submit this application form in line with GEN section 11.9. You may send applications by post or hand delivered and addressed to your usual supervisory contact.

            The address for postal submission is:

            DUBAI FINANCIAL SERVICES AUTHORITY
            AUTHORISATION DEPARTMENT
            LEVEL 13, THE GATE
            PO BOX 75850
            DUBAI, UAE

          • AFN SUP4 Applying to vary a Licence

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

          • AFN SUP5 Application to add or remove an endorsement on a Licence to carry on Financial Services with Retail Clients

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be submitted by an Authorised Firm (the "applicant") wishing to add or remove an endorsement on its Licence to carry on Financial Services with Retail Clients (the "Retail Endorsement").

            The DFSA may require additional information or clarification in order to complete the processing of an application. In this respect, the DFSA will correspond with the applicant's contact person as detailed below.

            Note for applicants

            The DFSA will grant a Retail Endorsement only if is satisfied that the applicant has demonstrated that it has the ability to provide Financial Services to Retail Clients in conformity with the requirements set forth in the DFSA Rulebook.

            When assessing an application for a Retail Endorsement, the DFSA will consider, among other things, the following:

            1. The adequacy of an applicant's systems and controls for carrying on Financial Services with a Retail Client.

            An applicant must also be able to demonstrate that its systems and controls (including policies and procedures) adequately provide for, among other things, compliance with the requirements specifically dealing with Retail Clients, in particular:
            •   marketing materials intended for Retail Clients;
            •   content requirements for Client Agreements for Retail Clients;
            •   suitability assessment for recommending a financial product for a Retail Client;
            •   disclosure of fees and commissions, and any inducements, to a Retail Client; and
            •   segregation of Client Money and/or Client Assets, where relevant.

            An applicant's systems and controls must be adequate to ensure on an ongoing basis, that its Employees remain competent and capable to perform the functions which are assigned to them, including any additional factors that may be relevant if their functions involve interfacing with Retail Clients.
            2. The adequacy of the applicant's Complaints handling policies and procedures

            An applicant must have Complaints handling policies and procedures that meet the requirements in GEN chapter 9 of the GEN Module. These require an Authorised Firm to have adequate written policies and procedures for the investigation and resolution of complaints made against it by a Retail Client, including any redress available to such a Client (e.g. compensation).

            An applicant's policies and procedures must provide for fair, consistent and prompt handling of Complaints. In addition to the matters set out in chapter 9, the policies and procedures should explicitly deal with how the applicant ensures that:
            •  Employees dealing with Complaints have adequate training and competencies to handle Complaints, as well as impartiality and sufficient authority (see Rules GEN 5.3.19, GEN 9.2.7 and GEN 9.2.8);
            •  a Retail Client is made aware of the firm's Complaints handling policies and procedures before obtaining its services (see COB Rule A2.1.2(1)(h)); and
            •  the applicant's Complaints handling policies and procedures are freely available to any Retail Client upon request.
            Applicant's contact person for this application  
            Position/title  
            Correspondence address  
            Telephone / fax number:  
            E-mail address  

          • AFN SUP6 Applying to withdraw a Licence

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

        • Chapter 4 — Chapter 4 — AFN GEN Forms

          • AFN GEN1 Application for Registration as an auditor

            Set out here are the preliminary notes relating to the form; click here to download the specific AFN form above in Word formatWord format.

            Purpose of this form

            This form must be submitted by an audit firm wishing to apply for registration as an Auditor. An Auditor means a partnership or company that is registered by the DFSA to provide audit services to Authorised Firms and Authorised Market Institutions that are Domestic Firms or to Domestic Funds.

            In some cases, the DFSA may require additional information in order to complete the processing of this application. If this is necessary, the DFSA will contact the nominated contact identified in section 1.

            Contents

            This form consists of seven sections:

            1 Audit firm details
            2 Anti Money Laundering
            3 Fit & proper questionnaire for AMLO
            4 Fit & proper questionnaire for audit firm
            5 Declaration
            6 Payment of Fees
            7 Attachments

            Notes for completing this form

            •   Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •   All sections must be completed.
            •  Questions must be fully answered and the use of abbreviations should be avoided.
            •   Do not leave any questions blank — if a question is not applicable this should be indicated in the response section.
            •  Answers must be typed and the form must be signed by a Director/Partner and the Anti Money Laundering Officer (if different).
            •  Please ensure any supporting documentation is clearly labelled and securely attached.
            [Amended][VER2/11-06]
            [Amended][VER3/10-07]

          • AFN GEN2 Request for Modification

            Click here Click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

        • Chapter 5 — Chapter 5 — AFN CIR Forms

          • AFN CIR Notification of the marketing and selling of Funds

            Click hereClick here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

          • Deleted Forms

            • AFN CIR F1 [Deleted]

              (* and the Trustee, in the case of an Investment Trust)

              Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

              Purpose of this form

              This purpose of this form is for an Operator of a Collective Investment Fund to register a Domestic Fund with the DFSA as required under the CIR Module of the DFSA Rulebook. It must be submitted by the proposed Operator of the Domestic Fund, and may be submitted on the basis that the proposed Operator is:

              •  An applicant to be an Authorised Firm, whose application includes the proposed Financial Service of Operating a Collective Investment Fund (in which case, Form AUT–CORE and Form AUT–INV must also be submitted);
              •   An existing Authorised Firm that is authorised to Operate a Collective Investment Fund in respect of one or more Funds, and wishes to register a new Fund; or
              •   An existing Authorised Firm that is not authorised to Operate a Collective Investment Fund but who has submitted a Form SUP4 to amend the scope of its Licence to include Operating a Collective Investment Fund.

              Only a Domestic Fund that is a Public Fund can be registered with the DFSA. A Public Fund, under Article 46 of the Collective Investment Law 2006, is one that "...has or intends to have more than 100 Unitholders; or its Units are, or are to be, offered by means of public offering to potential participants". Under Article 54 of the Collective Investment Law 2006, a Domestic Fund "…that is not a Public Fund" is a Private Fund. The Operator of a Private Fund must, amongst other things, separately notify the DFSA 14 days prior to the initial issue or offer of Units in the Private Fund. The CIR Module sets out the contents of such a notification.

              A Fund will only be registered where the Authorised Firm and the Fund meet the criteria set out in the CIR Module with respect to a Domestic Fund. The Firm (as the Operator) must be, and continue to be, fit and proper with respect to its activities, and have the requisite skills, experience, resources and controls in order to Operate a Collective Investment Fund of the nature and type proposed.

              The DFSA may require additional information or clarification in order to complete the processing of an application. In this respect, the DFSA will correspond with the applicant's contact person, as detailed in Form AUT–CORE. If the proposed Operator is an existing Authorised Firm, please indicate below the relevant contact details for the purposes of this application.

              Applicant's contact person for this application  
              Position/title  
              Correspondence address

               
              Telephone / fax number:  
              E-mail address  

              Notes for completing this form

              •  This form should only be completed by a firm wishing to Operate a Collective Investment Fund which is a Public Fund. Firms wishing to Operate a Collective Investment Fund which is a Private Fund should not complete this form, and instead complete questions 3.23 to 3.48 of Form AUT–INV.
              •  In the case of a Public Fund which is an Investment Trust, this form must also be signed by the proposed trustee of the fund, who must be an Authorised Firm, or an applicant to be an Authorised Firm, for the purpose of carrying on the Financial Service of Acting as the Trustee of a Fund.
              •  The term Fund in this form refers to the entity for which an Operator is seeking registration as a Public Fund. In order to be a Public Fund, the Fund must be incorporated or established in the DIFC, i.e. a Domestic Fund. Questions in this form are directed at the Fund as the subject of this application, and at the Operator, in respect of its role in relation to the Fund, and answers should therefore be given in the context of the specific question.
              •  Only a Domestic Fund may be Operated by an Authorised Firm. Marketing of a Foreign Fund in the DIFC may only be undertaken by an Authorised Firm in accordance with the requirements of the CIR Module of the DFSA's Rulebook.
              •  Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
              •  All financial information must be given in US dollars, together with a statement of the original currency used (if relevant) and the exchange rate applied for conversion.
              •  Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
              •  Do not leave any questions blank. If a question is not applicable this should be indicated in the response section. Failure to answer questions or provide full responses may delay the progress of the application.
              •  Answers must be typed in electronic format and the form must be signed by a Director/Partner of the Applicant or, in the event that, for example, the applicant has yet to be incorporated, the Director or Partner who will be authorised in due course to sign on behalf of the applicant.

              Contents

              Section Title
              1 General Information
              2 Specialist Fund Information
              3 Additional questions in relation to the Trustee (if applicable)
              4 Payment of Fees
              5 Declaration
              6 Checklist of Attachments

            • AFN CIR F2 [Deleted]

              Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

              Purpose of this form

              The purpose of this form is to facilitate the notification requirement in CIR Rule 18.2.1 of the DFSA's Rulebook pursuant to Article 56 of the Collective Investments Law.

              Article 56 of the Collective Investment Law 2006 requires the Operator of a Private Fund to notify the DFSA at least 14 days prior to the initial, and if a closed-ended Fund any subsequent, issue or offer of Units in the Fund.

              Additional information is also required concerning certain prime broker arrangements set out under CIR Rule 18.2.1(b) where the Private Fund is also a Hedge Fund.

              Do not use this form in respect of a Public Fund, which instead requires an application for registration of the Fund with the DFSA by submission of Form AFN CIR F1—Registration of a Public Fund.

              On receipt of this form (CIR F2), the DFSA may, as appropriate, request a copy of the Prospectus of the Private Fund or any other information to provide further clarification.

              Applicant's contact person for this notification  
              Position/title  
              Correspondence address  
              Telephone / fax number:  
              E-mail address  

              Notes for completing this form

              •   This form should be completed by the Operator of the Private Fund to which this notification relates, and submitted to the DFSA at least 14 days prior to the initial offer of Units in the Private Fund (or subsequent issue or offer in respect of a closed-ended Fund).
              •   The form should be submitted for the attention of the Operator's normal supervisory contact at the DFSA, to the address given at the back of the form.
              •   Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
              •   All financial information must be given in US dollars, together with a statement of the original currency used (if relevant) and the exchange rate applied for conversion.
              •   Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
              •   Do not leave any questions blank. If a question is not applicable this should be indicated in the response section.
              •   Answers must be typed in electronic format and the form must be signed by the Compliance Officer, Senior Executive Officer, or a Director/Partner of the Authorised Firm that is operating Private Fund.

              Contents

              Section Title
              1 Operator information
              2 Private Fund information
              3 Payment of Fees
              4 Declaration
              5 Attachments

            • AFN CIR F3 [Deleted]

              Set out here are the preliminary notes relating to the form, click hereclick here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

              Purpose of this form

              The purpose of this form is to assist an Authorised Firm with its reporting requirements in the Collective Investment Rules of the DFSA Rulebook in relation to the marketing and selling of Foreign Funds and Domestic Funds.

              The form consists of four sections:

              1. Authorised Firm information
              2. Marketing and selling of Foreign Funds
              3. Marketing and selling of Domestic Funds
              4. Declaration

              All firms must complete sections 1 and 4, together with section 2 and 3 as applicable, or both, if this is the case.

              On receipt of this form, the DFSA may, as appropriate, request any other information to provide further clarification.

              Notes for completing this form

              •   Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
              •   Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
              •   Do not leave any questions blank. If a question is not applicable this should be indicated in the response section.
              •   Answers must be typed in electronic format and the form must be signed by the Compliance Officer, Senior Executive Officer, or a Licensed Director/Partner of the Authorised Firm, or an individual designated by one of these persons for the purpose of completing this form.
              Applicant's contact person for this notification  
              Position/title  
              Correspondence address  
              Telephone / fax number:  
              E-mail address  

        • Chapter 6 — Chapter 6 — AFN AMI Forms

          • AFN AMI1 Reporting Return Coversheet

            Please click here to download the specific AFN form above in Word formatWord format.

          • AFN AMI2 Application for a Waiver

            Set out here are the preliminary notes relating to the form; click here to download the specific AFN form above in Word formatWord format.

            Purpose of this form

            An Authorised Market Institution wishing to apply for a waiver of a Rule must submit this form.

            Contents

            This form consists of six sections:

            1. Authorised Market Institution details
            2. Details of waiver sought
            3. Research and reasons
            4. Publication
            5. Additional information
            6. Declaration and signature

            Notes for completing this form

            •  Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •  Sections 1, 2, 3, 4 and 6 must be completed.
            •  Please use section 5 if you wish to provide additional information that may clarify or support your answers in sections 1–4.
            •  Questions must be fully answered and the use of abbreviations should be avoided.
            •  Answers must be typed and the form must be signed by either the Authorised Market Institution's relevant Key Individual or Director.
            •  Please ensure any supporting documentation is clearly labelled and securely attached.
            •  When completed, submit this application form in line with GEN section 11.2. You may send applications by post or hand delivered and addressed to your usual market contact.

            The address for postal submission is:

            DUBAI FINANCIAL SERVICES AUTHORITY
            AUTHORISATION DEPARTMENT
            LEVEL 13, THE GATE
            PO BOX 75850
            DUBAI, UAE
            •  You can inspect published waivers on the DFSA website: www.dfsa.ae

          • AFN AMI3 Applications and Notifications Concerning a Change in Control

            Set out here are the preliminary notes relating to the form; click here to download the specific AFN form above in Word formatWord format.

            Purpose of this form

            This form must be submitted by an Authorised Market Institution applying for approval from or notifying the DFSA concerning a change in control of the Authorised Market Institution. This form may also be used by a Controller.

            Authorised Market Institutions are required to complete a form for each application or notification.

            An Authorised Market Institution or Controller must submit an application or notification, as applicable, concerning a change in control, at least 28 days in advance of the proposed change, or immediately upon becoming aware of a proposed or actual change in control.

            Contents

            This form consists of six sections:

            1. Controllers—individuals
            2. Controllers—undertakings
            3. Details of new control or change in level of control
            4. Additional information
            5. Declaration
            6. Attachments

            Notes for completing this form

            •  Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •  Section 1 must be completed if the application/notification of a change in control relates to an individual.
            •  Section 2 must be completed if the application/notification of a change in control relates to an undertaking.
            •  Section 3 and 5 must be completed in respect of all applications/notifications.
            •  Please use section 4 if you wish to provide additional information that may clarify or support your answers in sections 1–3.
            •  Questions must be fully answered and the use of abbreviations should be avoided.
            •  Answers must be typed and the form must be signed by the Authorised Market Institution's relevant Key Individual, Director or the relevant Controller.

        • [Deleted]


          • AFN COB1 [Deleted]


        • Chapter 7 — Chapter 7 — AFN REC Forms

          • AFN REC1 Application for Recognised Member status

            Click here Click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

        • Chapter 8 — Chapter 8 — AFN MKT Forms

          • AFN MKT1 Application for Prospectus Approval

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be submitted by an Applicant who is required to issue a Prospectus pursuant to Article 14 of the Markets Law 2012 or a Supplementary Prospectus pursuant to Article 18 of the Markets Law 2012.

            Notes for completing this form

            •   In this form, the term Applicant means an applicant seeking the approval of a Prospectus in accordance with the requirements prescribed in the Markets Rules (MKT) of the DFSA Rulebook.
            •   Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA Rulebook.
            •   A Prospectus includes the Summary, Registration Statement and Securities Note as specified in the MKT.
            •    Where applicable, Applicants must submit documents and fees required under Rule 2.6 or 6.3 of the MKT.
            •   This application form on the DFSA's website is in PDF format. Editable Microsoft Word version may be obtained from the DFSA on request.
            •   A passport copy of the individual authorised to sign the declaration must be provided with this form.
            •   Applications will not be processed until the relevant fee is paid in full to the DFSA. Details of the fee schedule are set out in the Fees module of the DFSA Rulebook. Please make the payment by bank transfer in US Dollars to the account listed below. Cheques or bank drafts will not be accepted.
            Account name Dubai Financial Services Authority
            Account number 020-683751-100
            IBAN: AE080200000020683751100
            Bank details HSBC Bank Middle East
            PO Box 66, Dubai, UAE
            Swift code BBMEAEAD
            Reference to be quoted Application fee [applicant name]

            (Kindly provide a copy of the remittance advice to the DFSA)

          • AFN MKT2 Application for Admission of Securities to the Official List of Securities of the DFSA

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be submitted by any Person which proposes to seek an admission of Securities to the Official List of Securities maintained by the DFSA. This application must be made pursuant to Chapter 9 (The Listing Rules) of the Markets Rules of the DFSA Rulebook (MKT).

            Contents

            Section Title Who should complete the section
            1 General Information To be completed by all Applicants
            2 Security Details To be completed by all Applicants
            3 Trading Details To be completed by all Applicants
            4 Additional Information To be completed where relevant
            5 Prospectus Exemptions To be completed where relevant
            6 Islamic Securities To be completed where relevant
            7 Declaration To be completed by all Applicants

            Notes for completing this form

            •   In this form, the term "Applicant" means an applicant for admission of Securities to the Official List of Securities of the DFSA and includes, where the context requires, the Issuer.
            •   In this form, a reference to Securities is a reference to the Securities of the Issuer or, where the context requires, the Securities for which the Applicant is or proposes to be a Reporting Entity but not the Issuer.
            •   In this form, a reference to the "Listing Rules" is a reference to Chapter 9 of the MKT and relevant appendices.
            •   Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA Rulebook.
            •   Questions must be answered fully and the use of abbreviations or acronyms should be avoided or such acronym clearly defined.
            •   Do not leave any questions blank. If a question is not applicable this should be indicated in the response section. Failure to answer questions or provide full responses may delay the progress of the application.
            •   Prior to completion of this form, Applicants are strongly urged to read the Markets Law 2012 and MKT to ensure appropriate information is provided to the DFSA.
            •   Answers must be typed in electronic format and the form must be signed by a Director of the Applicant.
            •    A passport copy of the the individual authorised to sign the declaration must be provided with this form.
            •   Applicants are reminded that any material changes to any information submitted in this application whilst it is under consideration by the DFSA must be immediately notified to the DFSA, and that failing to provide such information may lead to an offence under Article 66 of the Regulatory Law 2004 if it causes information submitted to the DFSA to be false, misleading or deceptive at the time that the DFSA relies upon it.
            •   The application will not be processed until the relevant fee is paid in full to the DFSA. Details of the fee schedule are set out in the Fees module of the DFSA Rulebook. Please make the payment by bank transfer in US Dollars to the account listed below. Cheques or bank drafts will not be accepted.
            Account name Dubai Financial Services Authority
            Account number 020-683751-100
            IBAN: AE080200000020683751100
            Bank details HSBC Bank Middle East
            PO Box 66
            Dubai, UAE
            Swift code BBMEAEAD
            Reference to be quoted Application fee [applicant name]

            (Kindly provide a copy of the remittance advice to the DFSA)

          • AFN MKT3 Sponsor's Declaration

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Notes for completing this form

            •   Defined terms are identified throughout this declaration form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •   The DFSA requires the original of the completed sponsor¡¦s declaration. No facsimiles will be accepted. The declaration must be signed and initialled manually where necessary and not mechanically or electronically.
            •   This declaration form is in PDF format on the DFSA's website. Editable Microsoft Word version can be obtained from the DFSA on request.
            •   A passport copy of the individual authorised to sign this declaration must be provided with this declaration.

          • AFN MKT4 Application for a Waiver & Modification Form

            Click here Click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

        • Chapter 9 — Chapter 9 — AFN DNFBP Forms

          • AFN DNF1 Designated Non-Financial Business or Profession (DNFBP) Registration Form

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be submitted by a DNFBP in order to register with the DFSA to carry on its business activity in or from the DIFC. A registration notice must be submitted in relation to any of the DNFBP types contained in section 2. In some cases, the DFSA may require additional information in order to complete the processing of this application. If this is necessary, the DFSA will contact the DNFBP's nominated person identified in section 1 and/or section 3.

            Contents

            This form consists of the below sections:

            1. DNFBP Details
            2. Type of DNFBP
            3. Anti Money Laundering
            4. Declaration
            5. Applicable Fees
            6. Attachments

            Notes for completing this form

            •    Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the AML module of the DFSA's Rulebook. Some of the defined terms and abbreviations may also be found in the Glossary module of the DFSA Rulebook.
            •    You should read and be familiar with the AML module (AML) of the DFSA's Rulebook.
            •    All relevant sections must be completed.
            •    Questions must be fully answered and the use of abbreviations should be avoided.
            •    Do not leave any questions blank — if a question is not applicable this should be indicated in the response section.
            •    Answers must be typed and the form must be signed by a Director/Partner, or a member of the DNFBP's senior management.
            •    Please ensure any supporting documentation is clearly labelled and securely attached.

          • AFN DNF2 Designated Non-Financial Business or Profession (DNFBP) Changes to registration details

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this form

            This form must be used by a DNFBP to notify the DFSA of any changes in its name, legal status, address or, if applicable, its MLRO. The DFSA may require additional information in order to complete the processing of this notification.

            Contents

            This form consists of five sections:

            1. Summary of changes
            2. Changes to DNFBP details
            3. Changes to MLRO
            4. Declaration
            5. Attachments

            Notes for completing this form

            •    Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the AML module of the DFSA's Rulebook. Some of the defined terms and abbreviations may also be found in the Glossary module of the DFSA Rulebook.
            •    Please fill in the section(s) relevant to the change(s) of your firm.
            •    Questions must be fully answered and the use of abbreviations should be avoided.
            •    Do not leave any questions blank in the relevant section of change(s) — if a question is not applicable this should be indicated in the response section.
            •    Answers must be typed and the form must be signed by a Director/Partner, or a member of the DNFBPs senior management.
            •    Please ensure any supporting documentation is clearly labelled and securely attached.

        • Chapter 10 — Chapter 10 — AFN AML Forms

          • AFN AML Annual AML Return

            Set out here are the preliminary notes relating to the form, click here click here to download the specific AFN form above, press "Read only" and then enter details where the form permits you to.

            Purpose of this Return

            This AML Return must be submitted by every Relevant Person who is required to under Rule 14.5.1 of the AML module of the DFSA Rulebook. The AML Return is required to be completed annually and submitted to the DFSA within four months of the end of the submitter's financial year end, and be signed by the Governing Body and/or senior management of the Relevant Person.

            This AML return is one the supervisory tools used by the DFSA to assess a Relevant Person's compliance with its AML obligations. The form will also allow the DFSA to identify and action any relevant AML issues and trends that emerge in the DIFC. Similarly, this AML Return may also form a part of a Relevant Person's systems and controls for monitoring compliance with its AML obligations.

            Notes for completing this Return

            •    You should familiarise yourself with the AML module before completing this return.
            •    All sections must be completed, where appropriate.
            •    Questions must be answered in full and the use of abbreviations should be avoided.
            •    Do not leave any questions blank — if a question is not applicable this should be indicated in the response section.
            •    If there is insufficient space to answer a question, please attach the answer in an appendix.
            •    Answers must be typed.
            •    Please ensure any supporting documentation is clearly labelled and attached.
            •    The AML Return includes, where appropriate, the relevant AML module Rule reference. These references should assist in framing the context of your answer. The Rule reference should also assist in determining if the question is applicable.
            •    If the answer to all or part of any question is covered within your AML Policies and Procedures, please provide the relevant reference and page number to that information in your response.

            Contents of AML Return

            A. Relevant Person Details
            B. Compliance with AML Obligations
            C. Applying a Risk Based Approach
            D. Customers and Customer Due Diligence
            E. Reliance and Outsourcing
            F. Audit
            G. Sanctions and Other International Obligations
            H. AML Training and Awareness
            I. Suspicious Activity Reports
            J. Governing Body/ Senior Management Declaration

        • Chapter 11 — Chapter 11 — AFN AUD Forms

          • AFN AUD1 Notification of Intention to continue to undertake responsibilities of an Audit Principal for a Registered Auditor

            Set out here are the preliminary notes relating to the form, click hereclick here to download the specific AFN form above in Word format.

            Purpose of this form

            The DFSA has recently made amendments to the regulatory regime applicable to auditors of Authorised Firms, Authorised Market Institutions, Public Listed Companies and Domestic Funds. As part of these amendments, the DFSA introduced a requirement to register Audit Principals of Registered Auditors.

            Please refer to DFSA Consultation Paper 91 and the recently enacted Regulatory Law 2004 and Auditor Module (AUD) of the DFSA Rulebook for full details regarding amendments to the audit regime and status of Audit Principals. These documents can be found on the DFSA website www.dfsa.ae under the tab "Legal Framework".

            Due to the nature of the amendments regarding Audit Principals, the DFSA requires existing Audit Principals to submit a notification to the DFSA confirming their intention to continue to undertake the responsibilities of an Audit Principal under the new regime, in addition to providing details that would, in the future, normally be required for registration of an Audit Principal.

            The Audit Principal and relevant Registered Auditor must submit this form by Monday 20th October 2014. If an existing Audit Principal does not intend to undertake the responsibilities of an Audit Principal, the Audit Principal and the relevant Registered Auditor must submit an application to withdraw that individual as an Audit Principal (AUD 2 Form — Application to withdraw Audit Principal Status — found in the AFN Module of the DFSA Sourcebook).

            Contents

            Section Title
            1 General Information
            2 Fit and proper questionnaire
            3 Attachments
            4 Declarations

            Notes for completing this form

            •   Defined terms are identified throughout this application form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •   Prior to completion of this form, the Audit Principal and the Registered Auditor should read the AUD Module of the DFSA Rulebook and Part 8 of the Regulatory Law 2004.
            •   All sections of the form must be completed. Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
            •   Do not leave any questions blank. If a question is not applicable this should be indicated in the response section. Failure to answer questions or provide full responses will delay the progress of the application.
            •   Answers must be typed in electronic format and the form must be signed by the Audit Principal and the Managing Partner of the Registered Auditor.
            •   Versions of this form on the DFSA's website are in PDF format. Editable Microsoft Word versions can be obtained from the DFSA.
            •   Passport copy must be provided.

          • AFN AUD2 Application to withdraw Audit Principal Status

            Set out here are the preliminary notes relating to the form, click hereclick here to download the specific AFN form above in Word format.

            Purpose of this form

            This form must be submitted by a Registered Audit or the relevant Audit Principal applying to withdraw Audit Principal Status. In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary, the DFSA will contact the person identified in section 1 of this form.

            Contents

            Section Title
            1 General Information
            2 Withdrawal of Audit Principal status
            3 Declarations

            Notes for completing this form

            •   Defined terms are identified throughout this application form by the capitalization of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
            •   Unless otherwise specified, applicant refers to the individual for whom Audit Principal Status is being withdrawn.
            •   Unless otherwise specified, Registered Auditor refers to the firm on whose behalf the application to withdraw Audit Principal Status is being submitted.
            •   Prior to completion of this form, the Audit Principal and the Registered Auditor should read the AUD Module of the DFSA Rulebook and Part 8 of the Regulatory Law 2004.
            •   All sections of the form must be completed.
            •   Questions must be answered fully and the use of abbreviations or acronyms should be avoided or defined.
            •   Do not leave any questions blank. If a question is not applicable this should be indicated in the response section. Failure to answer questions or provide full responses will delay the progress of the application.
            •   Answers must be typed, in electronic format, and the form must be signed by the Audit Principal and the Managing Partner of the Registered Auditor.

    • Prescribed Forms and Notices (PFN)

      PFN/VER1/264/09-04PFN/VER1/264/09-04

      PFN/VER2/265/10-04PFN/VER2/265/10-04

      PFN/VER3/02-05PFN/VER3/02-05

      View the current version of the Prescribed Forms and Notices Module (PFN).

      • Prescribed Forms and Notices Module (PFN) [VER5/04-06]

        • PFN 1 PFN 1 Introduction

          • PFN 1.1 PFN 1.1 Application

            • PFN 1.1.1

              (1) Chapter 1 applies to a Person to whom AUT, ASP, SUP, PIB, PIN or GEN applies.
              (2) Chapter 2 contains the forms referred to in AUT.
              (3) Chapter 3 contains the forms referred to in ASP.
              (4) Chapter 4 contains the forms referred to in SUP.
              (5) Chapter 5 contains the forms referred to in PIB.
              (6) Chapter 6 applies to an Insurer.
              (7) Chapter 7 contains the forms referred to in PIN.
              (8) Chapter 8 contains the forms referred to in GEN.
              (9) Chapter 9 contains the forms referred to in AMI.
              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

          • PFN 1.2 PFN 1.2 Defined terms

            • PFN 1.2.1

              Defined terms are identified throughout the forms by the capitalisation of the initial letter of a word or each word of a phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook. Unless the context otherwise requires, where capitalisation of the initial letter is not used, an expression has its natural meaning.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

        • PFN 2 PFN 2 AUT Forms

          Not in use — see new AFN Sourcebook.

          [Amended][VER5/04-06]

          • Not in use — see new AFN Sourcebook

            • PFN AUT 1 Application for a Licence Core Information

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by a Person applying for a Licence to carry on one or more Financial Services in or from the DIFC. An application must be submitted in relation to one or more Financial Services defined in the GEN module of the DFSA Rulebook. An Authorised Firm wishing to change the scope of its Licence need not complete this form but should complete the appropriate form (PFN AUT 2-PFN AUT 7) in relation to the proposed change to its Licence.

              This form has been designed to assist the DFSA in identifying the Financial Services for which authorisation is being sought and to understand how those activities will be carried on. The Applicant will need to satisfy the DFSA that, inter alia, sufficient financial resources, appropriate personnel, and adequate systems and internal controls have been developed in relation to the Financial Services to be carried on.

              In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary the DFSA will contact the individual identified in question 1.10 of this form.

              Contents

              This form has been divided into nine sections.

              1. Background
              2. Professional Advisers
              3. Financial Information
              4. Regulatory Business Plan
              5. Compliance
              6. Systems
              7. Declaration
              8. Attachments
              9. Auditor’s or reporting accountant’s report

              Notes for completing this form

              • Unless otherwise specified, ‘Applicant’ refers to the entity for which authorisation is being sought.


              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook. Unless otherwise specified, in the case of applications made in respect of Branches, the questions must be answered in the context of the Branch operations in the DIFC.


              • Prior to completion of this form, the Applicant is strongly urged to read the guidelines in form PFN AUT 8 in order to ensure appropriate information is provided to the DFSA.


              • Sections 1-7 must be completed by all Applicants


              • Sections 9 must be completed by the Applicant’s auditor or reporting accountant.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank – if a question is not applicable this should be indicated in the response section.


              • Answers must be typed and the form must be signed by a Director/Partner of the Applicant.


              • All financial information must be given in US dollars, together with a statement of the original currency used and the Exchange rate applied for conversion.


              • The DFSA understands that not all Applicants will engage all of the professional advisers listed in this form. If the Applicant does not intend to appoint a particular professional adviser this should be stated clearly under the relevant section.


              • Where the form asks for the scope of the professional adviser’s engagement, details should be provided about the work that the adviser has been engaged to perform. Mention must also be made of any exclusions from what the DFSA would consider the normal scope of the professional adviser’s operations.


              • Where the form asks for full address of the principal place of business and if this information is not available prior to authorisation, the Applicant is advised that premises must be secured within 12 months after the receipt of the Licence and before the commencement of Financial Services.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN AUT 2 Application for Authorisation Asset Management

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by a Person applying for authorisation to carry on asset management activities in or from the DIFC. An application must be submitted in relation to one or more Financial Services defined in the GEN module of the DFSA Rulebook.

              This form has been designed to assist the DFSA in identifying the Financial Services for which authorisation is being sought and to understand how those activities will be carried on. The Applicant will need to satisfy the DFSA that, inter alia, sufficient financial resources, appropriate personnel, and adequate systems and internal controls have been developed in relation to the Financial Services to be carried on.

              In some cases, the DFSA may require additional information in order to complete the processing of this application. If this is necessary the DFSA will contact the individual identified in form PFN AUT1 (Core Information) section 1.10.

              Contents

              This form consists of 13 sections.

              1. Background
              2. Business Profile
              3. Customer Base
              4. Personnel and Internal Controls
              5. Professional Services
              6. Outsourcing
              7. Compliance
              8. Systems
              9. Business Policy
              10. Business Financials
              11. Authorised Individuals
              12. Declaration
              13. Attachments

              Notes for completing this form

              • Unless otherwise specified, ’Applicant’ refers to the entity for whom authorisation is being sought.


              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Unless otherwise specified, in the case of applications made in respect of Branches, the questions must answered in the context of the Branch operations in the DIFC.


              • Prior to completion of this form, the Applicant is strongly urged to read the guidelines in form PFN AUT8 prepared in order to ensure appropriate information is provided to the DFSA.


              • Sections 1-5 and 9, 10 and 12 must be completed by all applicants.


              • Sections 6, 7, 8 and 11 must be completed if the Applicant is already an Authorised Firm and this application is being made to change the scope of its Licence.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank – if a question is not applicable, this should be indicated in the response section.


              • Answers must be typed and the form must be signed by a Director/Partner of the Applicant.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN AUT 3 Application for Authorisation Insurance and Reinsurance

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by a Person applying for authorisation to conduct Insurance Business in or from the DIFC. An application must be submitted in relation to one or more Financial Services defined in the GEN module of the DFSA Rulebook.

              This form has been designed to assist the DFSA in identifying the Financial Services for which authorisation is being sought and to understand how those activities will be carried on. The Applicant will need to satisfy the DFSA that, inter alia, sufficient financial resources, appropriate personnel, and adequate systems and internal controls have been developed in relation to the Financial Services to be carried on.

              In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary the DFSA will contact the individual identified in form PFN AUT1 (Core Information) section 1.10.

              Contents

              This form consists of five sections:

              1. General Information
              2. Insurance & Reinsurance
              3. Captive Insurer Information
              4. Protected Cell Company Information
              5. Declaration

              Notes for completing this form

              • All Applicants must complete PFN Section 1 and PFN Section 5.


              • Unless otherwise specified, ‘Applicant’ refers to the entity for which authorisation is being sought
              • .

              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA Rulebook.


              • Prior to completion of this form, the Applicant is strongly urged to read the guidelines in form PFN AUT8 in order to ensure appropriate information is provided to the DFSA.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank – if a question is not applicable, this should be indicated in the response section.


              • Answers must be typed and the form must be signed by a Director/Partner of the Applicant.


              • Unless otherwise specified, in the case of applications made in respect of Branches, the questions must be answered in the context of the Branch operations in the DIFC.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN AUT 4 Application for Authorisation Insurance Broking and Management

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by a Person applying for authorisation to carry on Insurance Intermediary Business in or from the DIFC. An application must be submitted in relation to one or more Financial Services defined in the GEN module of the DFSA Rulebook.

              This form has been designed to assist the DFSA to identify the Financial Services for which authorisation is being sought and to understand how those activities will be carried on. The Applicant will need to satisfy the DFSA that, inter alia, sufficient financial resources, appropriate personnel, and adequate systems and internal controls have been developed in relation to the Financial Services to be carried on.

              In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary the DFSA will contact the individual identified in form PFN AUT1 (Core Information) section 1.10.

              Contents

              This form consists of 12 sections.

              1. Background
              2. Business Profile
              3. Customer Base
              4. Personnel and Internal Controls
              5. Outsourcing
              6. Compliance
              7. Systems
              8. Business Policy
              9. Business Financials
              10. Authorised Individuals
              11. Declaration
              12. Attachments

              Notes for completing this form

              • Unless otherwise specified, ‘Applicant’ refers to the entity for which authorisation is being sought.


              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Prior to completion of this form, the Applicant is strongly urged to read the guidelines in form PFN AUT8 in order to ensure appropriate information is provided to the DFSA.


              • Sections 1-4, 9 and 11 must be completed by all Applicants.


              • Sections 5-8 and 10 must be completed if the Applicant is already an Authorised Firm and this application is being made to change the scope of its Licence.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank – if a question is not applicable, this should be indicated in the response section.


              • Answers must be typed and the form must be signed by a Director/Partner of the Applicant.


              • Unless otherwise specified, in the case of applications made in respect of Branches, the questions must be answered in the context of the Branch operations in the DIFC.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN AUT 5 Application for Authorisation Wholesale Banking and Corporate Finance

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by a Person applying for authorisation to carry on wholesale banking and corporate finance activities in the DIFC. An application must be submitted in relation to one or more Financial Services defined in the GEN module of the DFSA Rulebook.

              This form has been designed to assist the DFSA in identifying the Financial Services for which authorisation is being sought and to understand how those activities will be carried on. The Applicant will need to satisfy the DFSA that, inter alia, sufficient financial resources, appropriate personnel, and adequate systems and internal controls have been developed in relation to the Financial Services to be carried on.

              In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary the DFSA will contact the individual identified in form PFN AUT1 (Core Information) section 1.10.

              Contents

              This form consists of 13 sections.

              1. Background
              2. Business Profile
              3. Customer Base
              4. Personnel and Internal Controls
              5. Professional Services
              6. Outsourcing
              7. Compliance
              8. Systems
              9. Business Policy
              10. Business Financials
              11. Authorised Individuals
              12. Declaration
              13. Attachments

              Notes for completing this form

              • Unless otherwise specified, ‘Applicant’ refers to the entity for which authorisation is being sought.


              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Prior to completion of this form, the Applicant is strongly urged to read the guidelines in form PFN AUT8 in order to ensure appropriate information is provided to the DFSA.


              • Sections 1-5, 9 and 12 must be completed by all Applicants.


              • Sections 6-8, 10 and 11 must be completed if the Applicant is already an Authorised Firm and this application is being made to change the scope of its Licence.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank – if a question is not applicable, this should be indicated in the response section.


              • Answers must be typed and the form must be signed by a Director/Partner of the Applicant.


              • Unless otherwise specified, in the case of applications made in respect of Branches, the questions must be answered in the context of the Branch operations in the DIFC.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN AUT 6 Application for Authorisation Capital Markets

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form should be submitted by a Person applying for authorisation to carry on capital markets activities in the DIFC. An application must be submitted in relation to one or more Financial Services defined in the GEN module of the DFSA Rulebook.

              This form has been designed to assist the DFSA in identifying the Financial Services for which authorisation is being sought and to understand how those activities will be carried on. The Applicant will need to satisfy the DFSA that, inter alia, sufficient financial resources, appropriate personnel, and adequate systems and internal controls have been developed in relation to the Financial Services to be carried on.

              In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary the DFSA will contact the individual identified in form PFN AUT1 (Core Information) section 1.10.

              Contents

              This form consists of 13 sections.

              1. Background
              2. Business Profile
              3. Customer Base
              4. Personnel and Internal Controls
              5. Professional Services
              6. Outsourcing
              7. Compliance
              8. Systems
              9. Business Policy
              10. Business Financials
              11. Authorised Individuals
              12. Declaration
              13. Attachments

              Notes for completing this form

              • Unless otherwise specified, ‘Applicant’ refers to the entity for which authorisation is being sought.


              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Prior to completion of this form, the Applicant is strongly urged to read the guidelines in form PFN AUT8 in order to ensure appropriate information is provided to the DFSA.


              • Sections 1-5, 9 and 12 must be completed by all Applicants.


              • Sections 6-8, 10 and 11 must be completed if the Applicant is already an Authorised Firm and this application is being made to change the scope of its Licence.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank – if a question is not applicable, this should be indicated in the response section.


              • Answers must be typed and the form must be signed by a Director/Partner of the Applicant.


              • Unless otherwise specified, in the case of applications made in respect of Branches, the questions must be answered in the context of the Branch operations in the DIFC.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN AUT 7 Application for Authorisation Islamic Financial Business

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by a Person applying to conduct Islamic Financial Business activities in or from the DIFC. This form must be submitted with an application to conduct asset management (form PFN AUT2); insurance and/or reinsurance (form PFN AUT3); Insurance Broking and management (form PFN AUT4); wholesale banking and corporate finance (form PFN AUT5); or capital markets (form PFN AUT6).

              In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary the DFSA will contact the Person identified in form PFN AUT1 (Core Information) section 1.10.

              Contents

              This form consists of eight sections.

              1. Background
              2. Business Profile
              3. Customer Base
              4. Personnel and Internal Controls
              5. Professional Services
              6. Business Policy
              7. Declaration
              8. Attachments

              Notes for completing this form

              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Unless otherwise specified, ‘Applicant’ refers to the entity for which authorisation is being sought.


              • Prior to completion of this form, the Applicant is strongly urged to read the guidelines in form PFN AUT8.


              • All sections must be completed by all Applicants.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank – if a question is not applicable this should be indicated in the response section.


              • Answers must be typed and the form must be signed by a Director/Partner of the Applicant.


              • Unless otherwise specified, answers should be in relation to the Applicant’s Islamic Financial Business.


              • Unless otherwise specified, in the case of applications made in respect of Branches, the questions must be answered in the context of the Branch operations in the DIFC.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN AUT 8 PFN AUT 8 Guidelines for completing application forms for applicants seeking to carry on Financial Services in or from the DIFC

              Purpose of this form

              This form provides important information to Applicants, who wish to carry on Financial Services in or from the DIFC, about how to complete the licensing application forms for submission to the DFSA. It provides general Guidance about preparing and lodging the application as well as some explanation of the licensing structure applicable to the Applicant.

              Contents

              These Guidance notes consist of four sections.

              1. General Background
              2. Completing the Applications
              3. Submitting the Application
              4. Following the Application

              Notes

              • Unless otherwise specified, ‘Applicant’ refers to the entity for whom authorisation is being sought.


              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Applicants are strongly advised to read all five sections and may wish to refer to them while completing the application forms.


              • Applicants should also refer to the AUT module of the DFSA Rulebook and to the frequently asked questions (FAQs) available on the DFSA website www.dfsa.ae


              • These guidelines do not form part of the Regulatory Law 2004 and are not a restatement of the Law. They are intended to provide assistance in understanding the application forms (PFN AUT1 to PFN AUT7).


              • Unless otherwise specified, words with the initial letter capitalised are defined terms which can be found in the Glossary of the DFSA Rulebook and, unless the context otherwise requires, where capitalisation of the initial letter is not used, an expression has its natural meaning.


              • Applicants seeking further information should contact their professional advisers or the DFSA Authorisation Division.

              • PFN AUT 8.1 PFN AUT 8.1 General Background

                • PFN AUT 8.1.1

                  The application forms PFN AUT1 to PFN AUT7 are intended for firms who wish to obtain a Licence from the DFSA to carry on Financial Services in or from the DIFC. All Applicants are required to submit a Core Information form (PFN AUT1) and at least one of the business specific forms, e.g. Asset Management form (PFN AUT2). In addition, Applicants conducting Islamic Financial Business, either as an Islamic Financial Institution or through an Islamic Window, will be required to submit the Islamic Financial Business form (PFN AUT7).


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.1.2

                  Applicants applying for authorisation will be required to appoint individuals to carry out Licensed Functions on its behalf. Individuals carrying out defined Licensed Functions on behalf of the Applicant must be approved by the DFSA as Authorised Individuals. Applicants should submit applications for Authorised Individual status using form (PFN AUT9).


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.1.3

                  Applicants who receive authorisation will be granted a Licence under Article 48(1) of the Regulatory Law 2004. The Licence will detail the Financial Services and the types of insurance contracts, Deposits or Investments for which the authority relates. For the avoidance of doubt, the DFSA will not grant a Licence without the Applicant having identified at least one Financial Service for which authorisation will be required.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.1.4

                  No Person may carry on a Financial Service without a Licence.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.1.5

                  An Applicant that has been granted a Licence may only carry on the particular Financial Service that it is specifically authorised to carry on.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.1.6

                  If the Applicant also intends to carry on Ancillary Services, it will also need to complete a separate ASP registration form. For details, please read the ASP module of the DFSA Rulebook.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN AUT 8.2 PFN AUT 8.2 Completing the Applications

                • PFN AUT 8.2.1

                  Applicants should select the relevant application forms from the list below and complete them using the Guidance provided. The forms for firms and individuals can be found in this module of the DFSA Rulebook.

                  Name application form applicable to
                  AUT1 Core Information All firms must submit this form.
                  AUT2 Asset Management All firms must submit the form that most closely resembles their business activities.
                  AUT3 Insurance and Reinsurance
                  AUT4 Insurance Broking and Management
                  AUT5 Wholesale Banking and Corporate Finance
                  AUT6 Capital Markets
                  AUT7 Islamic Financial Business In addition to the above forms, firms conducting Islamic Financial Business must submit this form.
                  AUT9 Application for Authorised Individual Status A form must be submitted for each individual carrying out Licensed Functions on behalf of the firm.
                  (AUT8 is these guidelines)

                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.2

                  Applicants who do not already hold a Licence from the DFSA must complete the Core Information form (PFN AUT1), at least one business specific form (PFN AUT2-PFN AUT6) and an Authorised Individual form (PFN AUT9) for each individual carrying out a Licensed Function on behalf of the Applicant. Applicants conducting Islamic Financial Business must also submit the Islamic Financial Business form (PFN AUT7).


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.3

                  An Authorised Firm already Licensed by the DFSA applying to change the scope of its Licence should provide the DFSA with written details of the proposed changes in accordance with AUT rule 4.2.1. An Authorised Firm may provide the information set out in the Guidance to AUT rule 4.2.1 either in letter form or by using the relevant business specific form (PFN AUT2PFN AUT6).


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.4

                  In some cases the DFSA may require the Authorised Firm to complete a revised Core Information form (e.g. where a long period of time has elapsed since the previous Core Information form was submitted, or where the Authorised Firm has undergone significant changes in its structure or activities). If this is the case, the Authorised Firm will be notified.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.5

                  Applicants must answer all questions in full and in the English language. Where a particular question is not applicable, please write “Not Applicable”. Do not leave any question blank or unanswered, or the processing of the application may be delayed. To ensure the application forms are legible, answers must be typed.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.6

                  All forms must be signed by an authorised signatory. Particular forms may require different signatories and processing of the application may be delayed if they are not correctly signed by the appropriate Person. All signatures must be originals. Photocopied, faxed, electronic or ‘stamped’ signatures are not acceptable. Where relevant, the DFSA may ask to see a specific Board minute or other document authorising the authorised signatory to sign each form.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.7

                  Where the application form does not have sufficient space for an answer, Applicants may attach the answer on a separate piece of paper. Any annexure must clearly identify to which question it relates (e.g. “This annexure contains the answer to section 2, question 2.1 of form PFN AUT2).


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.8

                  Where copies of any documents are attached, these must be certified as true and complete copies of the original document. The authorised signatory of the relevant form should write, “This is a true and complete copy of the original” on the copy and sign and date the copy. Certification of these documents by a lawyer is not required.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.9

                  The application must be completed based on the Applicant’s knowledge of the proposed business and the Applicant must make all reasonable attempts to provide all information. If certain information is lacking or the Applicant is not certain of any matter, this must be clearly stated in the Applicant’s response. Applicants are reminded that it is an offence under Article 66 of the Regulatory Law 2004 to provide to the DFSA information which is false, misleading or deceptive or to conceal information where the concealment of such information is likely to mislead or deceive the DFSA.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.10

                  A professional adviser such as an accountant, lawyer or regulatory adviser may be used to assist in the preparation of this application, but by signing the application form the Applicant takes full responsibility for the contents of the form.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.11

                  The Applicant firm may appoint a professional adviser to act on their behalf in dealing with any correspondence or discussions relating to the application. Please note that the Applicant will be deemed to have received any correspondence sent to the advisers and is aware of any ongoing dialogue held with the appointed advisers.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.12

                  The answers contained in each form, together with any information the DFSA obtains from other sources, provide enough information to process most applications. In some cases additional information may be required in order to finalise the processing of the application – if this is necessary, the DFSA will contact the Applicant.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.2.13

                  2.13 If further assistance is required when completing the forms the Applicant firm is advised to contact the DFSA Authorisation Division.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN AUT 8.3 PFN AUT 8.3 Submitting the Application

                • PFN AUT 8.3.1

                  Completed application forms should be printed and signed by the Applicant’s authorised signatories.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.3.2

                  Completed application forms should be delivered in Person or by post/courier to the

                  DUBAI FINANCIAL SERVICES AUTHORITY
                  AUTHORISATION DEPARTMENT
                  LEVEL 13, THE GATE
                  PO BOX 75850
                  DUBAI, UAE


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                  [Amended][VER4/06-05]

                • PFN AUT 8.3.3

                  Applicants should retain a copy of the application form for their own records.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.3.4

                  Applicants are advised that the DFSA would appreciate the Applicant additionally submitting an electronic version, i.e. floppy disk or CD, of the completed application forms when submitting the hard copy version.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.3.5

                  All Application packs MUST be accompanied by a cheque made payable to the DFSA as payment of the relevant application Fee. Details of the application Fees are contained in the GEN module of the DFSA Rulebook. If the appropriate cheque is not enclosed, the application will not be processed.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN AUT 8.4 PFN AUT 8.4 Following the Application

                • PFN AUT 8.4.1

                  Once the DFSA receives an application, the application is assigned to a case officer within the Authorisation Division. The case officer is responsible for processing the application and will be the Applicant’s main point of contact with the DFSA during the application process.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.4.2

                  A letter of acknowledgement allotting an application reference number will be sent to the appropriate contact Person identified in the application form (note, the application reference number is not the same as the DFSA Licence number which is only allocated upon issue of a Licence).


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.4.3

                  If additional information is required in order to complete the processing of the application, the DFSA will usually seek this information within 4 weeks of sending the acknowledgement letter.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.4.4

                  The DFSA aims to process applications within two months of receiving all relevant information. This will depend to a large extent on the scale and complexity of a business, as well as the timely submission of information by Applicants and any responses to requests for further clarification. The application process is interactive, and may involve correspondence, meetings, reports from third parties, and on-site reviews or inspections.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN AUT 8.4.5

                  Upon the determination of an application, the DFSA will notify the Applicant in writing of the decision.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN AUT 9 Application for Authorisation Authorised Individual Status

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by an applicant or Authorised Firm applying for Authorised Individual status for an individual who is to carry out one or more Licensed Functions. An application must be made for one or more Licensed Functions defined in the AUT module of the DFSA Rulebook.

              Before submitting an application to the DFSA, the Authorised Firm must make reasonable enquires as to the individual's fitness and propriety to carry out the relevant Licensed Functions.

              In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary the DFSA will contact the Person identified in section 2 of this form.

              An Authorised Individual applying to extend or vary the scope of his Authorised Individual status should use form PFN AUT10 (Application to Extend or Vary Authorised Individual Status) instead of this form.

              An Authorised Individual applying to withdraw his Authorised Individual status should use form PFN AUT11 (Application to Withdraw Authorised Individual Status) instead of this form.

              Contents

              This form consists of eleven sections.

              1. General details
              2. Licensed functions
              3. Educational and professional qualifications
              4. Employment history
              5. Other personal registrations
              6. Professional memberships
              7. Other holdings
              8. Referees
              9. Fit and proper questionnaire
              10. Declaration
              11. Attachments

              Notes for completing this form

              • Unless otherwise specified, Applicant refers to the individual for whom Authorised Individual status is sought.


              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.


              • Prior to completion of this form, the applicant is strongly urged to read the guidelines in PFN AUT8.


              • All sections must be completed.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank — if a question is not applicable this should be indicated in the response section.


              • Answers must be typed and the form must be signed by the Applicant and the Senior Executive Officer or Compliance Officer of the Authorised Firm.


              • Unless otherwise specified, Authorised Firm refers the to firm on whose behalf the Applicant will be carrying out the Licensed Functions and includes, for the purposes of this application, a firm applying for authorisation to carry on Financial Services.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN AUT 10 Application to Extend or Vary Authorised Individual Status

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by an Authorised Firm applying to extend or vary an Authorised Individual’s authorised status. In some cases the DFSA may require additional information (including the re-submission of a complete form PFN AUT9 (Individual Registration) in order to complete the processing of this application. If this is necessary, the DFSA will contact the Person identified in section 2.

              If the Authorised Individual will cease to perform any Licensed Functions, form PFN AUT11 (Application to Withdraw Authorised Individual Status) should be submitted instead of this form.

              Contents

              This consists of eight sections:

              1. Authorised Individual details
              2. Authorised Firm details
              3. Changes to Licensed Functions
              4. New or additional Licensed Functions
              5. Fit and Proper Questionnaire
              6. Additional information
              7. Declaration
              8. Attachments

              Notes for completing this form

              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Sections 1, 2, 3, 5 and 7 must be completed.


              • Section 4 must be completed when making an application to perform one or more new Licensed Functions.


              • Please use section 6 if you wish to provide additional information that may clarify or support your answers in sections 1-4 or if the Applicant has answered ‘YES’ to any of the questions in section 5.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank – if a question is not applicable, this should be indicated in the response section.


              • Answers must be typed and the form must be signed by a Director/Partner of the Applicant.


              • Please ensure any supporting documentation is clearly labelled and securely attached.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN AUT 11 Application to Withdraw Authorised Individual Status

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by an Authorised Firm applying to withdraw an Authorised Individual’s authorised status. In some cases the DFSA may require additional information in order to complete the processing of this application. If this is necessary the DFSA will contact the Person identified in section 2.

              If the Authorised Individual will continue to perform one or more Licensed Functions, form PFN AUT10 (“Application to Extend or Vary Authorised Individual Status”) should be submitted instead of this form.

              Contents

              This form consists of five sections:

              1. Authorised Individual details
              2. Authorised Firm details
              3. Licensed Functions
              4. Additional information
              5. Declaration

              Notes for completing this form

              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • An Authorised Firm must apply for an Authorised Individual’s status to be withdrawn within seven days of the individual ceasing to be employed by the Authorised Firm to perform a Licensed Function.


              • Sections 1, 2, 3 and 5 must be completed.


              • Section 4 must be completed if section 3 requires additional information.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Answers must be typed and the form must be signed by either the Authorised Firm’s Senior Executive Officer or Compliance Officer.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN AUT 12 Applications and Notifications Concerning a Change in Control

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by an Authorised Firm applying for approval from or notifying the DFSA concerning a change in control of the Authorised Firm, this form may also be used by a Controller.

              Authorised Firms are required to complete a form for each application or notification.

              An Authorised Firm or Controller must submit an application or notification, as applicable, concerning a change in control, at least 28 days in advance of the proposed change, or immediately upon becoming aware of a proposed or actual change in control.

              Contents

              This form consists of six sections:

              1. Controllers – individuals
              2. Controllers – undertakings
              3. Details of new control or change in level of control
              4. Additional information
              5. Declaration
              6. Attachments

              Notes for completing this form

              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Section 1 must be completed if the application/notification of a change in control relates to an individual.


              • Section 2 must be completed if the application/notification of a change in control relates to an Undertaking.


              • Section 3 and 5 must be completed in respect of all applications/notifications.


              • Please use section 4 if you wish to provide additional information that may clarify or support your answers in sections 1-3.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Answers must be typed and the form must be signed by the Authorised Firm’s Senior Executive Officer, Compliance Officer or relevant Controller.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

        • PFN 3 ASP Forms PFN 3 ASP Forms

          Not in use — see new AFN Sourcebook.

          [Amended][VER5/04-06]

          • Not in use — see new AFN Sourcebook

            • PFN ASP 1 Ancillary Service Provider — Application for Registration

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by a Person applying for registration to carry on one or more Ancillary Services in or from the DIFC. An application must be submitted in relation to one or more of the Ancillary Services contained in section 2 question 2.1. In some cases, the DFSA may require additional information in order to complete the processing of this application. If this is necessary, the DFSA will contact the Principal Representative identified in section 3.

              Contents

              This form consists of seven sections:
              1. Applicant details
              2. Ancillary Services
              3. Designated Persons, Governing Body and Controllers
              4. Fit & proper questionnaire
              5. Additional information
              6. Declaration
              7. Attachments

              Notes for completing this form

              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Sections 1, 2, 3, 4 and 6 must be completed.


              • Please use section 5 if you wish to provide additional information that may clarify or support your answers in sections 1-4.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank – if a question is not applicable this should be indicated in the response section.


              • Answers must be typed and the form must be signed by a Director/Partner and the Principal Representative (if different).


              • Please ensure any supporting documentation is clearly labelled and securely attached.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN ASP 2 Ancillary Service Provider — Changes to Registration Details

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be used by an Ancillary Service Provider to make changes to the registration details held with the DFSA.

              This form must be used when applying to extend, vary or withdraw one or more Ancillary Services. It must also be used to make changes to the details held in relation to the ASP’s Designated Persons and Controllers. In some cases the DFSA may require additional information in order to finalise the processing of this application. If this is necessary the DFSA will contact the firm’s Principal Representative.

              Contents

              This form consists of eight sections:

              1. Summary of changes
              2. Changes to firm details
              3. Changes to Designated Persons and Controllers
              4. Fit & proper questionnaire
              5. Changes to Ancillary Services
              6. Additional information
              7. Declaration
              8. Attachments

              Notes for completing this form

              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Sections 1 and 7 must be completed by all firms.


              • Sections 2 and 3 must be completed if relevant.


              • Section 4 must be completed in respect of each new Designated Person and individual Controller identified in section 3.


              • Section 5 must be completed if making changes to your Ancillary Services.


              • Please use section 6 if you wish to provide additional information that may clarify or support your answers in sections 1-5.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Do not leave any questions blank – if a question is not applicable this should be indicated in the response section.


              • Answers must be typed and the form must be signed by a Director/Partner of the firm and the Principal Representative (if different).


              • Please ensure any supporting documentation is clearly labelled and securely attached.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN ASP 3 Ancillary Service Provider — Annual Declaration

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be used by an Ancillary Service Provider (other than one that is also an Authorised Firm) to make the annual declaration of compliance as required by ASP rule 5.3.1.

              In accordance with the rule an Ancillary Service Provider must submit an annual declaration of compliance to the DFSA each year, within two months of its financial year end.

              Contents

              This form consists of two sections:

              1. Annual declaration of compliance
              2. Attachments

              Notes for completing this form

              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Section 1 must be signed by a Director/Partner of the firm and the Principal Representative (if different).


              • Please ensure any supporting documentation is clearly labelled and securely attached.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

        • PFN 4 PFN 4 SUP Forms

          Not in use — see new AFN sourcebook

          [Amended][VER5/04-06]

          • Not in use — see new AFN sourcebook

            • PFN SUP 1 Reporting Return Coversheet

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN SUP 2 Application for a Waiver

              Please download the Form in PDFPDF format.

              Purpose of this form

              An Authorised Firm wishing to apply for a waiver of a rule must submit this form.

              Contents

              This form consists of six sections:

              1. Authorised Firm details
              2. Details of waiver sought
              3. Research and reasons
              4. Publication
              5. Additional information
              6. Declaration and signature

              Notes for completing this form

              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.


              • Sections 1, 2, 3, 4 and 6 must be completed.


              • Please use section 5 if you wish to provide additional information that may clarify or support your answers in sections 1-4.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Answers must be typed and the form must be signed by either the Authorised Firm’s Senior Executive Officer or Compliance Officer.


              • Please ensure any supporting documentation is clearly labelled and securely attached.


              • When completed, submit this application form in line with SUP chapter 3. You may send applications by post or hand delivered and addressed to your usual supervisory contact.

                The address for postal submission is:

                DUBAI FINANCIAL SERVICES AUTHORITY
                AUTHORISATION DEPARTMENT
                LEVEL 13, THE GATE
                PO BOX 75850
                DUBAI, UAE


              • You can inspect published waivers on the DFSA website: www.dfsa.ae

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN SUP 3 Application for approval for a Cell of a Protected Cell Company — Insurance

              Please download the Form in PDFPDF format.

              Purpose of this form

              An Authorised Firm wishing to apply for an additional Cell must submit this form.

              Contents

              This form consists of nine sections:

              1. Authorised Firm details
              2. Ownership details
              3. Insurance business
              4. General
              5. Additional information
              6. Money Laundering declaration
              7. Declaration and signature
              8. Attachments

              Notes for completing this form

              • Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA Rulebook.


              • Sections 1, 2, 3, 4, 6 and 7 must be completed.


              • Please use section 5 if you wish to provide additional information that may clarify or support your answers in sections 1-4.


              • Questions must be fully answered and the use of abbreviations should be avoided.


              • Answers must be typed and the form must be signed by the Authorised Firm’s Senior Executive Officer.


              • Please ensure any supporting documentation is clearly labelled and securely attached.


              • When completed, submit this application form in line with SUP chapter 9. You may send applications by post or hand delivered and addressed to your usual supervisory contact.


              The address for postal submission is:

              DUBAI FINANCIAL SERVICES AUTHORITY
              AUTHORISATION DEPARTMENT
              LEVEL 13, THE GATE
              PO BOX 75850
              DUBAI, UAE


            • Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

        • PFN 5 PIB Forms PFN 5 PIB Forms

          Not in use — see new PRU sourcebook

          • Not in use — see new PRU Sourcebook

            • PFN PIB Forms 1–11

              Purpose of these forms

              An Authorised Firm must submit the appropriate forms contained in this chapter in accordance with its category as defined in PIB appendix 7 and at the frequency stated in that appendix.

              Notes for completing these forms

              •   All figures must be typed and the declaration (in form PFN PIB 10) signed by the person authorised to sign the return in accordance with PIB Rule 1.6.1.
              •   The Authorised Firm’s name, licence number and reporting period should be identified on each form.
              •   Unless otherwise agreed with the DFSA, the Authorised Firm or Group’s reporting currency must be in US Dollars.
              •   Within the forms ‘N’ represents the reports for the current period and ‘N-1’ should contain figures provided in the previous period’s reporting statements. For the avoidance of doubt, for a reporting statement that is made on a quarterly basis, ‘N-1’ will be represent the previous quarter’s comparators, whereas for an annual reporting statement, ‘N-1’ will be the prior year’s reporting statement.
              •   Figures that related to expenses, losses or other negative amounts should be entered in brackets ‘(xxx)’.
              •   Forms must be presented in the English language.
              •   Authorised Firms are reminded that guidance notes are provided in form PFN PIB 11 which provides further detail on individual sections and boxes of the forms.
              •   When completed, submit the forms in line with SUP chapter 8. You may send applications by post or hand delivered and addressed to your usual supervisory contact.

              The address for postal submission is:

              DIFC FINANCIAL SERVICES AUTHORITY
              SUPERVISION DIVISION
              LEVEL 49, EMIRATES TOWERS
              PO BOX 75850
              DUBAI, UAE

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIB 1 PFN PIB 1 Balance Sheet

              Please download the Form in PDFPDF format.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

              • PFN PIB 1 App1 Detail of Non-trading Book Assets

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

              • PFN PIB 1 App2 Detail of Non-Market Risk in the Trading Book

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

              • PFN PIB 1 App3 Detail of Market Risk in the Trading Book

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

              • PFN PIB 1 App4 Calculation of DCR

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

            • PFN PIB 2 PFN PIB 2 Islamic Business — Balance Sheet

              Please download the Form in PDFPDF format.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

              • PFN PIB 2 App1 Detail of Non-Trading Book Self-Financed Assets

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIB 2 App2 Detail of Non-Trading Book Assets Financed By Unrestricted PSIAs

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

              • PFN PIB 2 App3 Detail of Non-Trading Book Assets Financed By Restricted PSIAs

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

              • PFN PIB 2 App4 Detail of Non Market Risk in the Trading Book Self-Financed

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

              • PFN PIB 2 App5 Detail on Non-Market Risk in the Trading Book - PSIAU Financed

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

              • PFN PIB 2 App6 Detail of Non Market Risk in the Trading Book – PSIAR Financed

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

              • PFN PIB 2 App7 Detail of Market Risk in the Trading Book

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

              • PFN PIB 2 App8 Islamic — Calculation of DCR

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

              • PFN PIB 2 App9 Analysis of Reserves Movement

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

            • PFN PIB 3 Profit and Loss Statement

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIB 4 Profit and Loss Statement for Islamic Financial Institutions

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIB 5 Expenditure Based Capital Minimum — Solo

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIB 6 Capital Adequacy Calculation — Solo

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIB 7 PFN PIB 7 Large Exposures

              Please download the Form in PDFPDF format.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

              • PFN PIB 7 App1 Detail of Largest 25 Exposures by Contract Type

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

            • PFN PIB 8 Liquidity Schedule — Maturity Mismatch

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIB 9 PFN PIB 9 Branch Return

              Please download the Form in PDFPDF format.

              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

              • PFN PIB 9 App1 Large Exposures Undertaken out of the Branch

                Please download the Form in PDFPDF format.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
                [Amended][VER4/06-05]

            • PFN PIB 10 Declaration by Authorised Firm

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIB 11 Instruction Guidelines

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

        • PFN 6 PFN 6 Form and Content of PIN Forms

          Not in use — see new PRU sourcebook

          • Not in use — see new PRU Sourcebook

            • PFN PIN 6.1 PFN PIN 6.1 Purpose and general provisions

              • PFN PIN 6.1.1

                This chapter applies to all Insurers.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.1.2 PFN PIN 6.1.2

                In this chapter, unless the term ‘Annual Regulatory Return’ or ‘Quarterly Regulatory Return’ is used, the term ‘Return’ includes both of those Returns.

                • PFN PIN 6.1.2 Guidance

                  1. This chapter sets out the form and content of the Returns that all Insurers must submit to the DFSA. The form and content of the Returns differs according to the characteristics of the Insurer.
                  2. General requirements relating to the Recognition and measurement of assets and liabilities are dealt with in PIN chapter 5. This chapter deals with matters relating to presentation of the information contained in the Returns.

                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.2 PFN PIN 6.2 Completion of forms for global, cell, fund and DIFC business reporting units

              • PFN PIN 6.2 Guidance

                Separate Returns are completed for Insurers’ entire business, and for those parts of the business that are subject to separate capital adequacy requirements, namely Cells, Long-Term Insurance Funds, and DIFC business. These parts, and the entire business, are described as ‘reporting units’ because a Return is required for each. An Insurer may therefore have to submit more than one set of Returns.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.2.1

                A Return must be completed in respect of each of the reporting Units set out in this section that applies to the Insurer.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.2.2

                There are four types of reporting unit in respect of which an Insurer may be required to complete a Return. These are referred to in this chapter as the global reporting unit, the Cell reporting unit, the fund reporting unit and the DIFC business reporting unit. The Returns in respect these reporting Units are referred to respectively in this chapter as the Global Return, the Cell Return, the Fund Return and the DIFC Business Return.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.2.3

                Every Insurer that is required by PIN chapter 6 to complete a Return must complete a Global Return. A Global Return has the following characteristics:

                (a) Subject to (b), a Global Return includes all of the assets, liabilities, equity, revenues and expenses of the Insurer, regardless of the residency status or location of the Insurer, of the customer or of any asset or liability.
                (b) The Global Return of a Protected Cell Company does not include any assets, liabilities, equity, revenues or expenses that are attributable to a Cell.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.2.4

                Except as provided otherwise in this rule, an Insurer that is a Protected Cell Company must complete a Cell Return in respect of each Cell that it maintains. A Cell Return includes all of the assets, liabilities, equity, revenues and expenses attributable to the Cell, regardless of the residency status or location of the customer or of any asset or liability. An Insurer to which this rule applies is not required to complete a Quarterly Regulatory Return in respect of any Cells maintained by it that are Captive Cells.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.2.5 PFN PIN 6.2.5

                Except as provided otherwise in this rule, an Insurer that maintains a Long-Term Insurance Fund must complete a Fund Return in respect of each Long-Term Insurance Fund that it maintains. A Fund Return includes all of the assets, liabilities, revenues and expenses attributable to the Fund, regardless of the residency status or location of the customer or of any asset or liability. An Insurer to which this rule applies is not required to complete a Fund Return in the following cases:

                (a) where the Insurer is deemed to constitute a single, Long-Term Insurance Fund, such that the information contained in the Fund Return would be identical to that in the Global Return; and
                (b) where a Cell of the Insurer is deemed to constitute a single, Long-Term Insurance Fund, such that the information contained in the Fund Return would be identical to that in the Cell Return.

                • PFN PIN 6.2.5 Guidance

                  PIN rule 6.2.5 operates to prevent the preparation of duplicate Returns. However, where under this rule an Insurer or a Cell is exempt from the requirement to prepare a Quarterly Regulatory Return because of its captive status, the Fund Quarterly Regulatory Return would not be identical and must still be prepared.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.2.6 PFN PIN 6.2.6

                An Insurer that is not a DIFC Incorporated Insurer must complete a DIFC Business Return. A DIFC Business Return has the following characteristics:

                (a) it includes only liabilities that are Insurance Liabilities of the Insurer in respect of its DIFC Insurance Business and assets that are associated with those Insurance Liabilities; and
                (b) revenues and expenses must be included only to the extent that they are attributable to the Insurer’s DIFC Insurance Business.

                • PFN PIN 6.2.6 Guidance

                  The assets that are associated with Insurance Liabilities normally include only reinsurance and other recoveries in respect of claims, whether or not incurred, included in Insurance Liabilities. The DIFC Business Return does not include assets such as Investments, fixed assets, or receivables other than reinsurance recoveries in respect of Insurance Liabilities.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.3 PFN PIN 6.3 Content of returns

              • PFN PIN 6.3.1

                The Annual Regulatory Return contains the following forms, together with the Supplementary Notes pertaining to those forms and the Statement of Directors referred to in section 6.14:

                (a) Form 1: Statement of financial position;
                (b) Form 2: Statement of capital adequacy;
                (c) Form 3: Statement of financial performance;
                (d) Form 4: Statement of premium revenue and reinsurance expense;
                (e) Form 5: Statement of claims expense and recovery revenue;
                (f) Form 6: Statement of movements in insurance provisions;
                (g) Form 7: Statement of Investment income;
                (h) Form 8: Statement of acquisition expenses; and
                (i) Form 9: Reconciliation to financial statements.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.3.2

                The Quarterly Regulatory Return contains the following forms, together with the Supplementary Notes pertaining to those forms and the Statement of Directors referred to in section 6.14:

                (a) Form 1: Statement of financial position;
                (b) Form 2: Statement of capital adequacy;
                (c) Form 3: Statement of financial performance; and
                (d) Form 10: Summary statement of operations

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.3.3

                The forms referred to in Rules PIN 6.3.1 and PIN 6.3.2 must be prepared for each reporting unit for which an Insurer is required to complete an Annual Regulatory Return or a Quarterly Regulatory Return as applicable, except where:

                (a) this chapter states that the form is not required for that reporting unit, or
                (b) the form would contain no information, in which case the Insurer may omit the form and present a Supplementary Note stating that the form has not been prepared for that reason.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.3.4

                The format of the forms contained in the Returns is set out in chapter 7 of this module.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.3.5

                Items must be disclosed on the forms in accordance with the descriptions set out on the face of the forms, subject to the effects of other provisions of this chapter.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.3.6

                Where an item is described on the face of a form as the result of a mathematical calculation, that mathematical calculation must be used to determine that item.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.4 PFN PIN 6.4 General provisions relating to the completion of forms

              • PFN PIN 6.4 Guidance

                Annual Regulatory Returns follow the cycle of the Insurer’s normal statutory reporting, under the Companies Law 2004 in the DIFC and under equivalent legislation elsewhere. Quarterly Regulatory Returns are presented on a year to date basis at specified dates.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.4.1

                Supplementary Notes must be presented on separate pages, not included on the face of the forms to which they relate. Each Supplementary Note must identify the form to which it relates.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.4.2

                Returns must be presented in the English language.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.4.3

                A Return must be presented in United States currency, rounded to thousands of dollars, with no decimal place.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.4.4

                Where the format of a form requires the presentation of comparative information, the comparative information shall be presented according to the following principles:

                (a) In the case of a form forming part of the Annual Regulatory Return, the comparative information shall be that presented in the Annual Regulatory Return for the previous reporting period.
                (b) In the case of a form forming part of the Quarterly Regulatory Return, the comparative information shall be that presented in the Quarterly Regulatory Return for the corresponding quarter in the previous calendar year.
                (c) Comparative information shall be presented unless:
                (i) the Insurer did not exist at any time during the comparative period (whether or not it was an Insurer);
                (ii) in the case of a Cell Return or a Fund Return, the Cell or Long-Term Insurance Fund to which the Return relates did not exist at any time during the comparative period; or
                (iii) so far only as concerns the DIFC Business Return, in the case of an Insurer that is not a DIFC Incorporated Insurer, the Insurer was not at any time an Insurer during the comparative period.
                (d) An Insurer that is required to present comparative information in a Return, and that was not required to prepare a Return in respect of the comparative period, must present comparative information that would have been presented in the Return covering the comparative period, if the Insurer had been required to prepare that Return.
                (e) Comparative information shall not be changed from the time it was first presented, unless re-presentation is necessary for the interpretation of the Return. Where comparative information is changed, the Insurer must include in the Return a Supplementary Note showing the nature of the change and the reason for it.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.4.5

                The Annual Regulatory Return, including the Statement by Directors, is subject to audit, except where this chapter states that a form is not subject to audit.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.4.6

                Each page in a Return, including the Statement by Directors and any Supplementary Notes, must show:

                (a) the words ‘Annual Regulatory Return’ or ‘Quarterly Regulatory Return’, as applicable;
                (b) sufficient information to identify the form or other statement;
                (c) the Insurer’s Licence number;
                (d) the Insurer’s name;
                (e) the reporting period to which the Return relates;
                (f) whether the Return is a Global, Cell, Fund or DIFC Business Return; and
                (g) where the Return relates to a Cell or a Long-Term Insurance Fund, sufficient information to identify the Cell or Long-Term Insurance Fund in question.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.4.7 PFN PIN 6.4.7

                Where this chapter requires information to be presented for different Classes of Business or for different types of insurance contract (that is, direct insurance, facultative reinsurance, proportional reinsurance treaty and non-proportional reinsurance treaty), an Insurer required to complete the form must present the relevant information in respect of all Classes of Business and types of contract, except under the following circumstances:

                (a) Where an item of numerical information in respect of a Class of Business for a type of insurance contract is less than two per cent of the total such numerical information in respect of all Classes of Business for that type of insurance contract, the Insurer may aggregate that numerical information for that Class of Business for that type of insurance contract with the same item of information for the Class of Business for that type of contract in which that item of information is the largest.
                (b) Where an item of numerical information in respect of a type of insurance contract for a Class of Business is less than two per cent of the total such numerical information in respect of all types of insurance contract for that Class of Business, the Insurer may aggregate that numerical information for that type of insurance contract for that Class of Business with the same item of information for the type of insurance contract for that Class of Business in which that item of information is the largest.

                • PFN PIN 6.4.7 Guidance

                  This rule establishes de minimis limits for an Insurer in respect of detailed numerical information presented by Class of Business or by type of insurance contract. Amounts below the de minimis limits may be aggregated together with other items of information in the same line or column of a form. Insurers are not required to apply the sub-Rules in the order that they are set out. However, Insurers should ensure that the Returns continue to comply with both sub-Rules after applying either. It is possible that applying the second sub-Rule to be applied could affect compliance with the first.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.4.8 PFN PIN 6.4.8

                Where an Insurer arranges its affairs such that a Cell or Long-Term Insurance Fund maintained by it pays or receives income in the form of interest, dividends, rental, recharge of management expenses or other Investment income, from another reporting unit of the Insurer, that income must be shown gross as an expense in the reporting unit bearing the expense, and as income in the reporting unit receiving the income. Where however the same reporting unit records the income and the expense, the two must be netted off.

                • PFN PIN 6.4.8 Guidance

                  This rule establishes accounting policy in respect of transactions between reporting Units. Internal recharges within an Insurer should be shown as such where they are external to a reporting unit of that Insurer. However, where a reporting unit (for example, the Global Return of an Insurer that is not a Protected Cell Company, and that maintains one or more Long-Term Insurance Funds) includes both 'sides' of the internal Transaction, the internal Transaction must be eliminated by Netting off the income and expense.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.5 PFN PIN 6.5 Form 1: Statement of financial position

              • PFN PIN 6.5 Guidance

                1. The ‘Statement of Financial Position’ provides the DFSA with the necessary information on assets, liabilities and capital to undertake an assessment of an Insurer’s financial position and performance and facilitate in assessing compliance with the minimum Capital Requirements.
                2. PIN section 5.3 deals with the Recognition and measurement of assets and liabilities on this form.
                3. The Rules in this section provide instructions as to the completion of specific lines on the form. Instructions that are provided in respect of a particular Category of current assets or liabilities are normally applicable also (with the appropriate changes) to the corresponding Category of noncurrent assets or liabilities, and vice versa.
                4. The completion of this form requires Insurers to make estimates, for example in assigning assets and liabilities as current or non-current. As an example, the settlement date of outstanding claims, particularly IBNR, is often uncertain. An Insurer may make a reasonable estimate of the amount that is expected to be settled within twelve months, and record that amount as a current liability, with the balance being recorded as non-current. A similar approach would be acceptable for the assets representing reinsurance and other recoveries, that would not normally become due and receivable until the underling claim has been settled.
                5. Insurers are required to disclose the amount included in certain totals that relates to parties Related to the Insurer. These disclosures exclude amounts due to or from the Insurer under Contracts of Insurance.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.1

                This form is required for each reporting unit in respect of which the Insurer must prepare a Return, except for a DIFC Business Return.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.2

                Assets and liabilities must be reported as current or non-current. Current assets and liabilities are those expected to mature or be realised within a twelve-month period from the date as at which the Return is drawn up. Where an asset or a liability includes elements that are current as well as elements that are non-current, the asset or liability must be separated into the current and non-current components, if necessary by means of an estimate.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.3

                Item 1 on the form includes only cash and liquid assets. Insurers must have regard to the following principles:

                (a) Item 1.2 includes only Deposits available within 24 hours that are used by the Insurer for daily purposes of liquidity and operations. Deposits that form part of the Insurer’s Investments are reported at item 3 or item 7; and
                (b) Bank overdrafts must be reported at item 21.3, not netted against item 1 unless there is a legal right of offset.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.4 PFN PIN 6.5.4

                Item 2 on the form includes only receivables. In completing this item, Insurers must have regard to the following principles:

                (a) Receivables must be stated net of any provision for doubtful debt or impairment of asset;
                (b) Item 2.2 includes items such as subrogation or salvage recoveries in respect of claims that have been paid;
                (c) Item 2.3 includes instalment premiums on General Insurance contracts that are not yet due for payment. It also includes premiums on General Insurance contracts that have been entered into but not yet recorded. It does not include premiums on Long-Term Insurance contracts that are not yet due for payment;
                (d) Item 2.4 includes amounts due and receivable under reinsurance contracts, including premiums due from cedants and Deposits retained by cedants, as well as amounts due from reinsurers in respect of recoveries against claims that have been paid. Where there is a legal right of set-off, an Insurer may report the working balance on an account with a cedant or reinsurer as a net receivable or payable amount. However if there is no legal right of set-off, amounts must be recorded gross as receivables and payables;
                (e) Item 2.5 includes amounts in respect of reinsurance and other recoveries in respect of claims that have been incurred but not paid, up to the date to which the Return is drawn up. This includes reinsurance and other recoveries in respect of IBNR. Because of the uncertainty of the outcome of outstanding claims and IBNR, it is necessary to estimate at least a part of this balance. The basis on which the estimate is made must be consistent with the basis of estimation of the Related liability, reported at item 18;
                (f) Reinsurance and other recoveries in respect of claims that have not yet been incurred are reported at item 2.6. It is necessary to estimate this balance. The basis on which the estimate is made must be consistent with the basis of estimation of the Related liability, reported at item 19; and
                (g) Where, in determining the amounts to be reported at item 2.4 or 2.5, an Insurer has made or considered making a provision for doubtful debt in respect of recoveries due or potentially due from a reinsurer, the Insurer must take into account the potential need to make a provision when determining any estimate to be included at item 2.5 or 2.6.

                • PFN PIN 6.5.4 Guidance

                  It is common practice for Insurers to account for their exposures on General Insurance contracts in force by means of an unearned premium provision, an asset representing deferred reinsurance expense and (where necessary) a premium deficiency reserve. Insurers are referred to the Guidance to item 19. An Insurer that uses an unearned premium provision and premium deficiency reserve as a proxy for Premium Liabilities may record its deferred reinsurance expense at item 2.6 (for the current portion) and item 7.6 (for the noncurrent portion).


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.5 PFN PIN 6.5.5

                An Insurer’s current Investments are reported at item 3. This item does not include Derivatives used to hedge Investments reported here. Hedging Derivatives are included in item 5. Insurers must have regard to the following principles when completing item 3:

                (a) Investments that are strategic in nature must be assumed to be non-current, and must be reported at item 8 or item 9; and
                (b) Deposits that are of the nature of Security Deposits, or retentions under contracts, are not reported at item 3.1 but are reported as receivables.

                • PFN PIN 6.5.5 Guidance

                  Investments that take the form of mudaraba or musharaka contracts must be reported in accordance with their nature. A contract that takes the form of a collective Investment, where the Insurer is one of several investors providing capital to a mudarib who then provides the capital to the entrepreneur, should be reported as a collective Investment (where it does not fall to be reported as a Profit Sharing Investment Account). Where however, a contract of mudaraba or musharaka is entered into by an Insurer as an Investment directly with an entrepreneur, or through a mudarib with the Insurer as sole rab ul mal, the Investment should be reported as a contract of mudaraba or musharaka as appropriate.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.6

                Deferred tax assets that are current assets are reported at item 4. Insurers must have regard to the following principles when completing item 4:

                (a) Netting off of deferred tax assets and liabilities is permitted only where both the asset and the liability relate to the same tax to which the Insurer is subject, and are expected to crystallise in the same taxation period; and
                (b) Amounts that represent refunds due from taxation authorities, that are not contingent on earning future taxable income, are not deferred tax assets but are receivables.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.7

                Item 5 includes current assets that do not fall to be reported under other items. In completing this item, Insurers must have regard to the following principles:

                (a) Acquisition costs in respect of General Insurance Business must not be deferred, as the basis on which the Premium Liability is determined requires immediate expensing of acquisition costs; and
                (b) Item 5.2 does not include deferred reinsurance expense, as item 2.6 stands in place of this asset.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.8

                Item 6.1 reports the total of amounts due from, balances with or Investments in Related parties that form a part of the total of current assets. This amount excludes amounts due under insurance contracts.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.9

                In completing items 7 (non-current receivables) and 8 (non-current investments) Insurers should have regard to the principles set out in this section for the equivalent Categories of current assets.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.10

                In item 9, Investments in Related parties must be recognised and measured in accordance with the principles of chapter 5. Section 5.7 requires an Insurer to make allowance for any minimum Capital Requirement or equivalent to which a Subsidiary or Associate is subject in the jurisdiction in which it is incorporated.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.11

                In item 10, an Insurer must exclude any properties of the Insurer, whether or not occupied. Properties must be reported at item 3.6 or 8.6 as appropriate.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.12

                In item 11, an Insurer must report intangible assets after deducting any amortisation or impairment Charge in respect of those assets.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.13

                In completing items 12 (non-current deferred tax assets) and 13 (other non-current assets) Insurers should have regard to the principles set out in this section for the equivalent Categories of current assets.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.14

                Item 14.1 reports the total of amounts due from, balances with or Investments in Related parties that form a part of the total of current assets. This amount excludes amounts due under insurance contracts.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.15

                Amounts due under reinsurance contracts at item 17 must include premiums payable but not yet due for payment under the terms of reinsurance contracts, and Deposits withheld from reinsurers. Other items attributable to reinsurance contracts such as the reinsurer's portion of recoveries and salvage and commissions due to reinsurers must also be included under this item.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.16

                Item 18 reports the current portion of the Insurer’s provision for outstanding claims. This item must be completed having regard to the following principles:

                (a) The liability must represent the estimated cost to the Insurer of settling claims which it has incurred at the reporting date but which have not been finalised. The liability is in respect of both direct business and inward reinsurance business and must take into account unpaid claims, unreported claims, adjustments for claims development and the direct and indirect claims settlement costs that the Insurer expects to incur in settling its outstanding claims;
                (b) In the case of Long-Term Insurance Business, this item must include all claims liabilities in respect of Contracts of Insurance that are no longer included in the calculation of the net policy benefits at item 20;
                (c) The liability must be stated without deducting reinsurance and other recoveries (these are disclosed as an asset as reinsurance receivables);
                (d) The requirements for Recognition and measurement of this liability are set out in PIN sections 5.4 and 5.6; and
                (e) The liability does not include any amounts for catastrophe reserve, equalisation reserve or similar provisions that an Insurer may be required to maintain to satisfy regulatory requirements in a jurisdiction other than the DIFC.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.17 PFN PIN 6.5.17

                Item 19, Premium Liability, represents the current portion of the cost of providing insurance service over the unexpired period of General Insurance contracts in force at the balance date. This item must be completed having regard to the following principles:

                (a) The Premium Liability reported is required to cover the value of future claims payments and associated direct and indirect settlement costs arising during the unexpired portion of the contracts in question.
                (b) Item 19 must be recorded without deducting reinsurance and other recoveries (these are disclosed as an asset as reinsurance receivables); and
                (c) The requirements for Recognition and measurement of this liability are set out in section 5.4.
                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PFN PIN 6.5.17 Guidance

                  As stated in the Guidance to PIN rule 5.4.7, it is common practice for Insurers to account for their exposures on General Insurance contracts in force by means of an unearned premium provision and (where necessary) a premium deficiency reserve. Where the aggregate of the unearned premium provision and the premium deficiency reserve (both gross of reinsurance) can be shown to be not less than the amount of Premium Liability determined in accordance with section 5.4, an Insurer may use that aggregate as a proxy for Premium Liability for the purposes of recording items 19 and 29 on this form.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.18

                Item 20 represents the net value of future Policy Benefits under Long-Term Insurance contracts that are in force as at the date to which the Return is made up. The amount reported here must be determined in accordance with PIN section 5.6.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.19

                Item 23, provisions, must be completed having regard to the following principles:

                (a) A provision must be made at item 23.1 in respect of dividends payable out of past and current year profit, to the extent that profit has been recognised;
                (b) Employee entitlements at item 23.2 include annual leave, gratuity, accrued allowances, staff housing and loan benefits, healthcare, pension and other Employee entitlements; and
                (c) A provision must be made at item 23.3 in respect of any costs that the Insurer expects to incur as a result of restructuring, including severance, termination and redundancy payments, and integration costs.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.20

                Item 25.1 reports the amount of current liabilities representing amounts due to Related parties, other than amounts due under insurance contracts.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.21

                In completing items 26 to 34, Insurers should have regard to the principles set out in this section for the equivalent Categories of current liabilities.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.22

                Item 35 includes all loan capital and hybrid Securities that have been issued by the Insurer and have a residual term to maturity of more than one year. Any loan capital or hybrid Securities that have a residual term to maturity of less than one year should be reported as borrowings, at item 21.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.23

                Item 36.1 reports the amount of non-current liabilities representing amounts due to Related parties, other than amounts due under insurance contracts and amounts reported at line 35.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.24

                Item 36.2 reports the amount reported at item 35 representing interests of Related parties in loan capital or hybrid Securities issued by the Insurer.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.25

                In completing item 39, Equity, Insurers must have regard to the following principles:

                (a) Item 39.6 must be equal to item 38;
                (b) Hybrid Securities and loan capital are reported at item 35, not item 39;
                (c) Item 39.1 is not used in a Fund Return;
                (d) Item 39.3 is used only in a Fund Return, to record amounts of capital transferred into the Long-Term Insurance Fund; and
                (e) Where an Insurer makes use of item 39.6, the Insurer must State in a Supplementary Note the nature of the amount recorded at this item.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.26

                Insurers must record at item 39.8 the amount included at item 39.1 meeting the following descriptions:

                (a) in the case of a Global Return of an Insurer that is not a Protected Cell Company, the amount of ordinary share capital meeting the description at PIN rule A3.5.1(d);
                (b) in the case of a Global Return of an Insurer that is a Protected Cell Company, the amount of ordinary share capital meeting the description at PIN rule A5.5.1(e); and
                (c) in the case of a Cell Return, the amount of ordinary share capital meeting the description at PIN rule A5.10.1(d).

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.27

                No amount must be recorded at item 39.8 in the case of a Fund Return.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.5.28

                An Insurer must provide the following information in a Supplementary Note to this form:

                (a) any amount included in item 39.7 that is not available to meet the Insurance Liabilities of the Insurer;
                (b) the amount and details of any guarantees (apart from guarantees arising under Contracts of Insurance) given by the Insurer;
                (c) the amount and details of any contingent liabilities existing as at the date to which the Return is made up; and
                (d) where the amount of item 39.4 is not equal to the sum of items 39.4 and 39.5 for the comparative reporting period, a reconciliation of the differences. This applies only when the form forms a part of the Annual Regulatory Return.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.6 PFN PIN 6.6 Form 2: Statement of capital adequacy

              • PFN PIN 6.6 Guidance

                1. This form summarises the capital adequacy position of the Insurer so far as concerns the reporting unit for which it is prepared (Global, Cell, or Fund).
                2. The same form is used for all types of Return, although in the calculation of the Capital Requirements applicable to different Insurers and to their Cells and Long-Term Insurance Funds, different terminology is used. The terms on the face of the form need to be replaced with the specific equivalent terms from the relevant section (as set out in section 6.16), depending on the nature of the Insurer and the type of Return. This section contains the necessary Rules to give legal effect to this concept.
                3. This form lists a number of adjustments to arrive at the figure to be compared to the minimum Capital Requirement applicable to the reporting unit. The purpose of these adjustments is to remove significant anomalies that may arise due to the flexibility available to Insurers in selecting their accounting bases. Therefore, not all of these adjustments will be applicable to all Insurers. An item must not be added to the base capital figure if it is already included in the base capital figure because of the accounting basis adopted.
                4. The effect of the Rules on the Return of a Takaful Insurer is to exclude from equity any element of equity that is not available to participate in the surpluses or deficits of the Insurance Business of the Takaful Insurer, either directly or by loan to the Insurance Fund. Loans that have been made from the Owners’ Equity to the Insurance Fund are included in base capital without restriction, while amounts that are available for loan are treated as hybrid capital.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.6.1

                This form is required for each reporting unit in respect of which the Insurer must prepare a Return, except for a DIFC Business Return.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.6.2

                Insurers must follow the requirements of PIN chapter 4 when preparing this form.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.6.3

                On this form, terms used to describe items to be recorded must be interpreted in accordance with section 6.16.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.6.4

                Item 1, Base capital, represents the starting-point for the calculation of the Capital Resources of the Insurer to be compared to the minimum Capital Requirement applicable to the Insurer. This item must be completed having regard to the following principles:

                (a) Item 1.1, Equity, must be equal to total equity reported at item 39.6 on form 1, less debt-financed equity reported at line 39.7 on form 1;
                (b) Item 1.2, Owners’ Equity, must be equal to the amount of Owners’ Equity in a Takaful Insurer that is available for loan to the Insurance Fund. It does not include any amount of loans made from Owners’ Equity to the Insurance Fund and not repaid. This item applies only to Takaful Insurers;
                (c) Any amount recorded at item 1.3.1 must not exceed the amount recorded at item 35.1 on form 1;
                (d) Any amount recorded at item 1.3.2 must not exceed the amount recorded at item 35.2 on form 1;
                (e) Item 1.3.3 may only be used by a Takaful Insurer. This item must equal item 1.2; and
                (f) Item 1.3.4 may not exceed the amount of item 39.7 on form 1.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.6.5 PFN PIN 6.6.5

                Item 2, Adjustments to base capital in accordance with PIN, must be completed having regard to the following principles:

                (a) Amounts referred to in item 2.1 must not be reported if those amounts are included at item 1.7;
                (b) Amounts referred to in item 2.2 must not be reported if those amounts are excluded from item 1.7;
                (c) Item 2.1.1, minority interests in subsidiaries, applies only where an Insurer excludes from its equity an amount representing minority interests in a controlled entity that is not accounted for as an investment;
                (d) Item 2.1.2, liability for dividends to be paid in the form of Shares, applies only where an Insurer has recorded as a liability a provision for dividends that are to be paid by issuing Shares. This item does not apply to a Fund Return;
                (e) Item 2.2.1 applies to the liability referred to in PIN rule A3.4.3(a) and equivalent provisions in PIN Rules A5.4.3(a), A5.8.3(a) and A7.4.2(a). This item does not apply to a Fund Return;
                (f) Item 2.2.2 applies only to a Return of a Takaful Insurer. This item represents amounts of Owners’ Equity that are not available for loan to the Insurance Fund or to participate in surpluses or deficits of the Insurance Fund;
                (g) Item 2.2.3 represents Investments of the Insurer or by any Subsidiary of the Insurer in the base capital of the Insurer recorded at item 1.4;
                (h) Item 2.2.4 represents the amount of any tax on capital gains, that was not recognised as a liability on form 1, and that would be incurred by the Insurer if the Investments reported on form were realised at the values shown on that form;
                (i) Item 2.2.5 must be equal to the amount of any deferred acquisition costs included on form 1, whether as a separate asset or as a reduction from liabilities;
                (j) Item 2.2.6 must be equal to the sum of items 4.3 and 12.3 on form 1;
                (k) Item 2.2.7 must be equal to the sum of any asset recorded on form 1 and representing the value of in-force Long-Term Insurance Business;
                (l) Item 2.2.8 must be equal to the sum of item 11.3 on form 1, and any other intangible assets recorded on form 1 and not otherwise excluded from base capital;
                (m) Item 2.2.9 applies only to a Return of a Takaful Insurer. This item represents any amount of Zakah or charity fund of a Takaful Insurer that is not otherwise excluded from base capital;
                (n) Item 2.2.10 represents the amount of an Insurer’s Class 7 Capital Requirement, in accordance with section 4.5. This item does not apply to a Fund Return;
                (o) Item 2.2.11 must be equal to the amount reported at item 10.3 on form 1; and
                (p) Item 2.2.12 must record the amount of any other assets, not otherwise excluded from base capital, that are not available to meet the Insurance Liabilities of the Insurer recorded on form 1.

                • PFN PIN 6.6.5 Guidance

                  Rule 6.6.5(p) would normally be expected to include assets that are subject to mortgages or other Charges, or than cannot for some other reason be realised for the benefit of policyholders.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.6.6

                Item 4.1, Hybrid Capital Adjustment before DFSA approval, must be calculated as the amount by which the sum of items 1.3.1 to 1.3.4 exceeds 15/85 of the amount arrived at by deducting item 1.2.1 from item 1.1.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.6.7 PFN PIN 6.6.7

                Item 4.2, additional hybrid capital approved by DFSA, may only be used to record additional amounts of hybrid capital that have been approved in writing by the DFSA, in accordance with PIN Rules A3.5.2, A5.5.4, A5.10.4 or A7.5.3. The amount of item 4.2 may not exceed the amount of item 4.1

                • PFN PIN 6.6.7 Guidance

                  Item 4.1 deducts hybrid capital that would normally be inadmissible because it exceeds the prescribed percentage. Item 4.2 reinstates hybrid capital that had been disallowed by item 4.1. Item 4.2 does not show the total amount of admissible hybrid capital, only that portion that exceeds the 15% ceiling.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.6.8

                Item 6, Minimum Capital Requirement sets out the components of the minimum Capital Requirement applicable to the reporting unit of the Insurer in respect of which the Return is completed. For each reporting unit, the components must be calculated in accordance with the chapter applicable to that reporting unit. The terms used in this item must be interpreted in accordance with section 6.16.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.6.9

                Item 6.11 may only be used with the written approval of the DFSA, to record an adjustment to the minimum Capital Requirement that has been approved in writing by the DFSA.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.6.10

                Item 7, Absolute minimum requirement applicable to reporting unit, must be interpreted in accordance with section 6.16 to this chapter.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.7 PFN PIN 6.7 Form 3: Statement of financial performance

              • PFN PIN 6.7 Guidance

                This form summarises the financial performance of the Insurer.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.7.1

                This form is required for each reporting unit in respect of which the Insurer must prepare a Return, except for a DIFC Business Return.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.7.2

                This form must agree with other forms in the Return (where those forms are prepared for the same reporting unit) in the following respects:

                (a) Item 1.1 must agree to form 4 item 9 column 5;
                (b) Item 1.2 must agree to form 4 item 28 column 5;
                (c) Item 2.1 must agree to form 4 item 19 column 5;
                (d) Item 2.2 must agree to form 4 item 37 column 5;
                (e) Item 4.1 must agree to form 5 item 9 column 5;
                (f) Item 4.2 must agree to form 5 item 28 column 5;
                (g) Item 5.1 must agree to form 5 item 19 column 5;
                (h) Item 5.2 must agree to form 5 item 37 column 5;
                (i) Item 10.1 must equal the sum of items 9 and 28 in column 5 on form 8;
                (j) Item 10.2 must equal the sum of items 19 and 37 in column 5 on form 8;
                (k) Item 13.1 must equal item 7 minus item 6.3 on form 7; and
                (l) Item 13.2 must agree to form 7 item 6.3.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.7.3

                An Insurer must present at item 7 the amount of the movement in the period reported on in the balance of Insurance Liabilities.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.7.4 PFN PIN 6.7.4

                An Insurer must present at item 8 the amount of the movement in the period reported on in the balance of reinsurance and other recoveries in respect of Insurance Liabilities.

                • PFN PIN 6.7.4 Guidance

                  Insurance Liabilities are reported gross of reinsurance and other recoveries. Reinsurance and other recoveries that are recorded in respect of Insurance Liabilities are reported as assets. An increase in Insurance Liabilities is reported on form 3 as an expense. In the same manner, an increase in the reinsurance and other recoveries in respect of Insurance Liabilities is recorded as revenue.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.7.5

                An Insurer must present the following information in a Supplementary Note to this form:

                (a) the amount if any included in item 11.2 that represents other operating income receivable from Related parties, and a description of the nature of that income;
                (b) the amount if any included in item 13.3 that represents Investment expenses payable to Related parties; and
                (c) where item 18 does not agree to form 1 item 39.5, a reconciliation showing the differences between the two figures.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.8 PFN PIN 6.8 Form 4: Statement of premium revenue and reinsurance expense

              • PFN PIN 6.8.1 PFN PIN 6.8.1

                This form is required for each reporting unit in respect of which the Insurer must prepare an Annual Regulatory Return, except for the Global Return of an Insurer that is a Protected Cell Company.

                • PFN PIN 6.8.1 Guidance

                  A Protected Cell Company is prevented by COB from carrying on Insurance Business other than through a Cell. Because this form would always be blank for such a company in its Global Return, there is no need for it to submit the form or to complete a Supplementary Note to explain its absence.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.8.2

                An Insurer must record premiums and reinsurance premiums relating to its Insurance Business on this form as follows:

                (a) An Insurer that is carrying on General Insurance Business must complete part I of this form;
                (b) An Insurer that is carrying on Long-Term Insurance Business must complete part II of this form; and
                (c) An Insurer that is carrying on Long-Term Insurance Business and General Insurance Business of Class 1 or Class 2 may elect either to record the General Insurance Business in part I of this form, or to include that business in Class I on part II of this form. An Insurer may not, between successive Returns, change its election without the written approval of the DFSA.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.8.3

                At items 1 to 8 and items 21 to 27, against each Class of Business, and for each type of insurance contract as set out in columns 1 to 4, an Insurer must record its Gross Written Premium for the reporting period in respect of that Class of Business and for that type of insurance contract.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.8.4 PFN PIN 6.8.4

                At items 11 to 18 and items 30 to 36, against each Class of Business, and for each type of insurance contract as set out in columns 1 to 4, an Insurer must record the reinsurance premium ceded in respect of each Class of Business and each type of insurance contract. Reinsurance premiums recorded as ceded must be gross of any commissions or brokerage, and must be recognised on a basis consistent with the Recognition of Gross Written Premium on this form.

                • PFN PIN 6.8.4 Guidance

                  Reinsurance premiums ceded must be analysed between columns 1 and 4 on the basis of the underlying insurance contracts that they are protecting, not on the basis of the reinsurance contracts themselves. Where reinsurance arrangements protect more than one type of business (for example both direct and facultative business) or more than one Class of Business, the Insurer must make a reasonable allocation of the reinsurance premiums between the types or Classes of Business covered.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.8.5

                An Insurer must disclose the aggregate amount of its insurance and reinsurance transactions with its Related parties as follows:

                (a) at item 10, the amount of Gross Written Premium accepted from Related parties that has been included in the total at item 9;
                (b) at item 20, the amount of reinsurance premium ceded to Related parties that has been included in the total at item 19;
                (c) at item 29, the amount of Gross Written Premium accepted from Related parties that has been included in the total at item 28; and
                (d) at item 38, the amount of reinsurance premium ceded to Related parties that has been included in the total at item 37.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.9 PFN PIN 6.9 Form 5: Statement of claims and reinsurance and other recoveries

              • PFN PIN 6.9.1 PFN PIN 6.9.1

                This form is required for each reporting unit in respect of which the Insurer must prepare an Annual Regulatory Return, except for the Global Return of an Insurer that is a Protected Cell Company.

                • PFN PIN 6.9.1 Guidance

                  A Protected Cell Company is prevented by COB from carrying on Insurance Business other than through a Cell. Because this form would always be blank for such a company in its Global Return, there is no need for it to submit the form or to complete a Supplementary Note to explain its absence.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.9.2

                An Insurer must record claims paid and reinsurance and other recoveries in respect of claims paid relating to its Insurance Business on this form as follows:

                (a) An Insurer that is carrying on General Insurance Business must complete part I of this form;
                (b) An Insurer that is carrying on Long-Term Insurance Business must complete part II of this form; and
                (c) An Insurer that is carrying on Long-Term Insurance Business and General Insurance Business of Class 1 or Class 2 must record the General Insurance Business in a manner consistent with that adopted in respect of form 4 as determined under (c).

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.9.3

                At items 1 to 8 and items 21 to 27, against each Class of Business, and for each type of insurance contract as set out in columns 1 to 4, an Insurer must record its gross claims paid for the reporting period in respect of that Class of Business and for that type of insurance contract.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.9.4

                For the purposes of this form, the amount of claims paid includes expenses incurred by the Insurer in the settlement of the claims.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.9.5 PFN PIN 6.9.5

                At items 11 to 18 and items 30 to 36, against each Class of Business, and for each type of insurance contract as set out in columns 1 to 4, an Insurer must record the reinsurance and other recoveries receivable in respect of claims paid, in respect of each Class of Business and each type of insurance contract.

                • PFN PIN 6.9.5 Guidance

                  Reinsurance recoveries must be analysed between columns 1 and 4 on the basis of the underlying insurance contracts that they relate to, not on the basis of the reinsurance contracts themselves. Where the nature of the reinsurance contract is such that the Insurer cannot identify individual claims benefiting from the recoveries (for example, in the case of an aggregate excess of loss contract, or a stop loss contract) the Insurer must make a reasonable allocation of the recoveries across the types and Classes of Business that have benefit of the reinsurance contracts.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.9.6

                An Insurer must disclose the aggregate amount of its insurance and reinsurance transactions with its Related parties as follows:

                (a) At item 10, the amount of gross claims paid to Related parties that has been included in the total at item 9;
                (b) At item 20, the amount of reinsurance and other recoveries receivable from Related parties that has been included in the total at item 19;
                (c) At item 29, the amount of gross claims paid to Related parties that has been included in the total at item 28; and
                (d) At item 38, the amount of reinsurance and other recoveries receivable from Related parties that has been included in the total at item 37.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.10 PFN PIN 6.10 Form 6: Statement of movements in insurance provisions

              • PFN PIN 6.10.1

                This form is required for each reporting unit in respect of which the Insurer prepares an Annual Regulatory Return, or a part of an Annual Regulatory Return, in respect of General Insurance Business.

                Guidance

                1. A Global Return is prevented by COB from carrying on Insurance Business other than through a Cell. Because this form would always be blank for such a company in its Global Return, and it is exempted from the requirement to complete other forms relating to General Insurance Business, there is no need for it to submit the form, or to complete a Supplementary Note to explain its absence.
                2. A Global Return of an Insurer that does not carry on General Insurance Business, or a Cell Return, Fund Return or DIFC Business Return of such an Insurer, also omits this form, without the need for a Supplementary Note to explain its absence. However, if an Insurer that carries on Long-Term Insurance Business together with Class 1 or Class 2 General Insurance Business elects to report that Class 1 or Class 2 business as General Insurance Business for the purposes of form 4 or form 5, it must also complete this form in respect of that business.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.10.2

                An Insurer must record separately, in parts I to IV and parts V to VIII respectively of this form, the information required in respect of claims outstanding (including IBNR) gross of reinsurance and other recoveries, and reinsurance and other recoveries in respect of those claims outstanding. This information must be presented for each Class of Business.

                Guidance

                Reinsurance recoveries must be analysed between parts V to VIII on the basis of the underlying insurance contracts that they relate to, not on the basis of the reinsurance contracts themselves. Where the nature of the reinsurance contract is such that the Insurer cannot identify individual claims benefiting from the recoveries (for example, in the case of an aggregate excess of loss contract, or a stop loss contract) the Insurer must make a reasonable allocation of the recoveries across the types and Classes of Business that have benefit of the reinsurance contracts.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.10.3

                Parts I, II, III and IV must be prepared on the following basis:

                (a) At column 1 in each part, the Insurer must record the amount of claims outstanding (including IBNR), at the end of the reporting period and in respect of claims incurred during the reporting period;
                (b) At column 2 in each part, the Insurer must record the amount of claims outstanding (including IBNR), at the beginning of the reporting period and in respect of claims incurred during the previous reporting period;
                (c) At column 3 in each part, the Insurer must record the amount of the movement during the reporting period in the provision for claims outstanding (including IBNR), in respect of claims incurred during the previous reporting period, that arises from those claims being one year closer to settlement;

                Guidance

                PIN chapter 5 requires an Insurer to record its Insurance Liabilities on a discounted basis. A liability for an outstanding claim increases between the beginning and end of a reporting period, because the amount of discount applied at the later is less. The expense represented by this increase is referred to in the form as release of discount.

                (d) At column 4 in each part, the Insurer must record the amount of claims paid during the reporting period, in respect of claims incurred during the previous reporting period;
                (e) At column 5 in each part, the Insurer must record the amount of other movements in the provision for claims outstanding (including IBNR), in respect of claims incurred during the previous reporting period;
                (f) At column 7 in each part, the Insurer must record the amount of claims outstanding (including IBNR), at the beginning of the reporting period and in respect of claims incurred before the beginning of the previous reporting period;
                (g) At column 8 in each part, the Insurer must record the amount of the movement during the reporting period in the provision for claims outstanding (including IBNR), in respect of claims incurred before the beginning of the previous reporting period, that arises from those claims being one year closer to settlement;
                (h) At column 9 in each part, the Insurer must record the amount of claims paid during the reporting period, in respect of claims incurred before the beginning of the previous reporting period; and
                (i) At column 10 in each part, the Insurer must record the amount of other movements in the provision for claims outstanding (including IBNR), in respect of claims incurred before the beginning of the previous reporting period.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.10.4

                Parts V, VI, VII and VIII must be prepared on the following basis:

                (a) At column 1 in each part, the Insurer must record the amount of the asset representing reinsurance and other recoveries in respect of outstanding claims (including IBNR), at the end of the reporting period and in respect of claims incurred during the reporting period;
                (b) At column 2 in each part, the Insurer must record the amount of the asset representing reinsurance and other recoveries in respect of outstanding claims (including IBNR), at the beginning of the reporting period and in respect of claims incurred during the previous reporting period;
                (c) At column 3 in each part, the Insurer must record the amount of the movement during the reporting period in the asset representing reinsurance and other recoveries in respect of outstanding claims (including IBNR), in respect of claims incurred during the previous reporting period, that arises from those recoveries being one year closer to settlement;

                Guidance

                PIN chapter 5 requires an Insurer to record its Insurance Liabilities and associated assets on a discounted basis. The asset representing reinsurance and other recoveries against outstanding claims increases between the beginning and end of a reporting period, because the amount of discount applied at the later is less. The revenue represented by this increase is referred to in the form as release of discount.

                (d) At column 4 in each part, the Insurer must record the amount of recoveries received during the reporting period, in respect of claims incurred during the previous reporting period;
                (e) At column 5 in each part, the Insurer must record the amount of other movements in the asset representing reinsurance and other recoveries in respect of outstanding claims (including IBNR), in respect of claims incurred during the previous reporting period;
                (f) At column 7 in each part, the Insurer must record the amount of the asset representing reinsurance and other recoveries in respect of outstanding claims (including IBNR), at the beginning of the reporting period and in respect of claims incurred before the beginning of the previous reporting period;
                (g) At column 8 in each part, the Insurer must record the amount of the movement during the reporting period in the asset representing reinsurance and other recoveries in respect of outstanding claims (including IBNR), in respect of claims incurred before the beginning of the previous reporting period, that arises from those claims being one year closer to settlement;
                (h) At column 9 in each part, the Insurer must record the amount of reinsurance and other recoveries received during the reporting period, in respect of claims incurred before the beginning of the previous reporting period; and
                (i) At column 10 in each part, the Insurer must record the amount of other movements in the asset representing reinsurance and other recoveries in respect of outstanding claims (including IBNR), in respect of claims incurred before the beginning of the previous reporting period.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.10.5

                The aggregate of items 9, 18, 27 and 36 in column 12 of this form must together equal the sum on form 1 of items 18 and 28, except in the case of a Return that does not include form 1.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.10.6

                The aggregate of items 45, 54, 63 and 72 in column 12 of this form must together equal the sum on form 1 of items 2.5 and 7.5, except in the case of a Return that does not include form 1.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PFN PIN 6.10.7

                An Insurer must present, as a Supplementary Note to this form, the following information:

                (a) the assumed inflation and discount rates, expressed as an annualised percentage, used by the Insurer in determining the amounts reported on this form, distinguishing between the rates assumed for the periods:
                (i) up to two calendar years after the end of the reporting period;
                (ii) more than two and up to five calendar years after the end of the reporting period; and
                (iii) more than five calendar years after the end of the reporting period;
                (b) the basis on which those assumed inflation and discount rates were determined; and
                (c) the estimated weighted average term to settlement of:
                (i) claims incurred in the reporting period;
                (ii) claims incurred in the previous reporting period; and
                (iii) claims incurred in earlier reporting periods.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.11 PFN PIN 6.11 Form 7: Statement of investment income

              • PIN 6.11.1

                This form is required for each reporting unit in respect of which the Insurer must prepare an Annual Regulatory Return, except for a DIFC Business Return.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.11.2 PIN 6.11.2

                This form must be completed in accordance with the following principles:

                (a) The Insurer must disclose at item 1 interest receivable, measured on an accruals basis, on Securities and loans bearing a fixed or variable rate of interest. This item should include interest receivable on cumulative preference shares;
                (b) The Insurer must disclose at item 2 dividends receivable on equity Securities;
                (c) The Insurer must disclose at item 3 rental income receivable, on an accruals basis, for the use of real property;
                (d) The Insurer must disclose at item 4 income receivable, on an accruals basis, under Investment contracts of mudaraba and musharaka other than Profit Sharing Investment Accounts or contracts of the nature of collective investments;

                • PIN 6.11.2(2) Guidance

                  Item 4 should include income receivable under contracts of mudaraba and musharaka where the nature of the Investment is that the Insurer provides capital to the Counterparty either directly or through a mudarib, but not in the form of a Profit Sharing Investment Account (PSIA), mutual fund or other collective Investment. Collective Investments including PSIAs are disclosed at item 5.

                  (e) The Insurer must disclose at item 5 income receivable, on an accruals basis, from collective Investments, including mutual funds, Profit Sharing Investment Accounts and contracts taking the form of collective investments;

                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PIN 6.11.2(3) Guidance

                  Item 5 should include income receivable under contracts that by their nature are collective Investments, where the Insurer stands as one of several rab ul mal providing capital to a mudarib who in turn invests that capital. The rab ul mal may receive a Sukuk or Certificate which may be transferable. Investments in Profit Sharing Investment Accounts will normally be disclosed here.

                  (f) The Insurer must disclose at item 6 the aggregate amount of changes in value in its Invested Assets. Where the aggregate amount of changes in value for either of item 6.1 or 6.2 represents a reduction in value, the Insurer must record that item as a negative figure; and
                  (g) The Insurer must disclose at item 7 the aggregate amount of any Investment income that does not fall into any of items 1 to 5. Where an Insurer uses this item, it must provide details of the item in question in a Supplementary Note to this form.

                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

                • PIN 6.11.2(4) Guidance

                  Item 7 will normally be used only by Insurers with income on Investments that do not readily fall into any of the Categories described in this rule. An Insurer reporting an amount under this item will normally be expected to provide sufficient information to explain to the DFSA the nature of the Investment and the nature of the income arising from it.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.12 PFN PIN 6.12 Form 8: Statement of acquisition expenses

              • PIN 6.12.1 PIN 6.12.1

                This form is required for each reporting unit in respect of which the Insurer must prepare an Annual Regulatory Return, except for the Global Return of an Insurer that is a Protected Cell Company.

                • PIN 6.12.1 Guidance

                  A Protected Cell Company is prevented by COB from carrying on Insurance Business other than through a Cell. Because this form would always be blank for such a company in its Global Return, there is no need for it to submit the form or to complete a Supplementary Note to explain its absence.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.12.2

                An Insurer must record acquisition expenses relating to its Insurance Business on this form as follows:

                (a) An Insurer that is carrying on General Insurance Business must complete part I of this form;
                (b) An Insurer that is carrying on Long-Term Insurance Business must complete part II of this form;
                (c) An Insurer that is carrying on Long-Term Insurance Business and General Insurance Business of Class 1 or Class 2 must record that business consistently with the election made pursuant to rule PIN 6.9.2 (c); and
                (d) Commissions receivable by Insurers from their reinsurers (often referred to as Exchange commissions, overriders or ceded acquisition costs) must not be netted against acquisition costs disclosed on this form but must be recorded as income on form 3 at item 11.1.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.12.3

                At items 1 to 8 and items 21 to 27, against each Class of Business, and for each type of insurance contract as set out in columns 1 to 4, an Insurer must record commissions and brokerage payable by it for the reporting period in respect of that Class of Business and for that type of insurance contract.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.12.4

                At items 11 to 18 and items 30 to 36, against each Class of Business, and for each type of insurance contract as set out in columns 1 to 4, an Insurer must record acquisition expenses other than Commission and brokerage payable by it in respect of each Class of Business and each type of insurance contract.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.12.5

                An Insurer must disclose the aggregate amount of acquisition costs payable to Related parties as follows:

                (a) at item 10, the amount of commissions and brokerage payable to Related parties that has been included in the total at item 9;
                (b) at item 20, the amount of other acquisition expenses payable to Related parties that has been included in the total at item 19;
                (c) at item 29, the amount of commissions and brokerage payable to Related parties that has been included in the total at item 28; and
                (d) at item 38, the amount of other acquisition expenses payable to Related parties that has been included in the total at item 37.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.13 PFN PIN 6.13 Form 9: Reconciliation to financial statements

              • PIN 6.13.1 PIN 6.13.1

                This form is required only for an Insurer’s Global Return. This form is not subject to audit.

                • PIN 6.13.1 Guidance

                  1. The purpose of this form is to provide a reconciliation between the net assets of the Insurer as recorded on form 1 and the net assets of the Insurer as recorded in its financial statements prepared under relevant companies legislation for the same reporting period.
                  2. Where an Insurer’s financial statements prepared under relevant companies legislation are not available at the time of lodgement of the Annual Regulatory Return, the Insurer will be expected to complete this form based on the draft financial position of the Insurer as at the end of the reporting period. Where the financial statements are subsequently provided to the DFSA as permitted by PIN rule 6.5.7, the Insurer should consider whether it is necessary to draw the attention of the DFSA to any significant changes between the draft financial statements on which this form was based and the financial statements subsequently provided.

                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.13.2

                An Insurer must disclose the amounts making up the difference between the Insurer’s net assets reported at item 39.7 on form 1 and the Insurer’s net assets (or equivalent designation) reported on the balance sheet, statement of financial position or equivalent document (referred to in this section as the ‘statutory balance sheet’) forming part of the financial statements that the Insurer is required to complete under the Companies Law 2004 (or equivalent legislation in jurisdictions other than the DIFC), made up as at the same date as the information contained in form 1.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.13.3

                Item 1 must agree to form 1 item 39.7.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.13.4

                Differences constituting differences in Recognition of assets and liabilities must be disclosed at item 2.1. Where an asset is recognised in the statutory balance sheet but not in form 1, the item must be disclosed as a positive amount, and vice versa. Where a liability is recognised in the statutory balance sheet but not in form 1, the item must be disclosed as a negative amount, and vice versa.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.13.5

                Differences constituting differences in valuation of assets and liabilities that are recognised in both the statutory balance sheet and form 1 must be disclosed at item 2.2. Where an asset is valued at more in the statutory balance sheet than in form 1, the item must be disclosed as a positive amount, and vice versa. Where a liability is valued at more in the statutory balance sheet than in form 1, the item must be disclosed as a negative amount, and vice versa.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.13.6

                The information presented at items 2.1 and 2.2 must include:

                (a) the amount of each material difference; and
                (b) a description of each material difference.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.13.7

                Item 3 must agree to the amount of net assets (or equivalent designation) in the Insurer’s statutory balance sheet.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.13.8 PIN 6.13.8

                Where this form does not contain sufficient space for the presentation of the information required by this section, the Insurer must present a Supplementary Note containing that information.

                • PIN 6.13.8 Guidance

                  Presenting a Supplementary Note does not relieve an Insurer from the obligation to prepare the form. However it will be acceptable for an Insurer to include on the form a reference to the Supplementary Note containing the information required to be presented, together with the aggregate amount covered in that Supplementary Note.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.14 PFN PIN 6.14 Form 10: Summary statement of operations

              • PIN 6.14 Form 10: Guidance

                1. The Summary statement of operations provides the DFSA with quarterly information on the operations of a DIFC Branch of an Insurer that is not incorporated in the DIFC.
                2. The Rules in this section provide instructions as to the completion of specific lines on the form. The instructions are similar to those applicable to corresponding items on forms 1 and 3, which are not applicable to DIFC Business Returns.
                3. On this form, reinsurance premiums and reinsurance recoveries refer to amounts ceded and recovered in respect of insurance contracts entered into as part of the Insurer’s DIFC Insurance Business, regardless of where the reinsurance premiums and reinsurance recoveries are payable or receivable.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.1

                This form is required only for a DIFC Business Return.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.2

                An Insurer must present at item 1 the amount of its Gross Written Premium in respect of its business conducted in the DIFC.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.3

                An Insurer must present at item 2 the amount of reinsurance premium ceded in respect of insurance contracts whose Gross Written Premium is recorded at item 1.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.4

                An Insurer must present at item 4 the amount of claims paid in respect of its business conducted in the DIFC.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.5

                An Insurer must present at item 5 the amount of reinsurance and other recoveries receivable in respect of claims recorded at item 4.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.6

                An Insurer must present at item 7 the amount of the movement in the period reported on in the balance of Insurance Liabilities.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.7 PIN 6.14.7

                An Insurer must present at item 8 the amount of the movement in the period reported on in the balance of reinsurance and other recoveries in respect of Insurance Liabilities.

                • PIN 6.14.7 Guidance

                  Insurance Liabilities are reported gross of reinsurance and other recoveries. Reinsurance and other recoveries that are recorded in respect of Insurance Liabilities are reported as assets. An increase in Insurance Liabilities is reported on form 10 as an expense. In the same manner, an increase in the reinsurance and other recoveries in respect of Insurance Liabilities is recorded as revenue.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.8

                Where an Insurer reports any amount at item 11.2, the Insurer must present in a Supplementary Note the amount of any such income receivable from Related parties, and a description of the nature of that income.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.9

                Item 13 reports the Insurer’s provision for outstanding claims. This item must be completed having regard to the following principles:

                (a) The liability must represent the estimated cost to the Insurer of settling claims which it has incurred at the reporting date but which have not been finalised. The liability is in respect of both direct business and inward reinsurance business and must take into account unpaid claims, unreported claims, adjustments for claims development and the direct and indirect claims settlement costs that the Insurer expects to incur in settling its outstanding claims;
                (b) In the case of Long-Term Insurance business, this item must include all claims liabilities in respect of Contracts of Insurance that are no longer included in the calculation of the net policy benefits at item 17;
                (c) The liability must be stated without deducting reinsurance and other recoveries (these are disclosed as an asset as reinsurance receivables);
                (d) The requirements for Recognition and measurement of this liability are set out in sections 5.4 and 5.6; and
                (e) The liability does not include any amounts for catastrophe reserve, equalisation reserve or similar provisions that an Insurer may be required to maintain to satisfy regulatory requirements in a jurisdiction other than the DIFC.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.10

                Item 14 includes amounts in respect of reinsurance and other recoveries in respect of claims that have been incurred but not paid, up to the date to which the Return is drawn up. This includes reinsurance and other recoveries in respect of IBNR.

                Because of the uncertainty of the outcome of outstanding claims and IBNR, it is necessary to estimate at least a part of this balance. The basis on which the estimate is made must be consistent with the basis of estimation of the Related liability, reported at item 13.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.11 PIN 6.14.11

                Item 15, Premium Liability, represents the current portion of the cost of providing insurance service over the unexpired period of General Insurance contracts in force at the balance date. This item must be completed having regard to the following principles:

                (a) The Premium Liability reported is required to cover the value of future claims payments and associated direct and indirect settlement costs arising during the unexpired portion of the contracts in question;
                (b) Item 15 must be recorded without deducting reinsurance and other recoveries (these are disclosed as an asset as reinsurance receivables); and
                (c) The requirements for Recognition and measurement of this liability are set out in section 5.4.

                • PIN 6.14.11 Guidance

                  As stated in the Guidance to PIN rule 5.4.7, it is common practice for Insurers to account for their exposures on General Insurance contracts in force by means of an unearned premium provision and (where necessary) a premium deficiency reserve. Where the aggregate of the unearned premium provision and the premium deficiency reserve (both gross of reinsurance) can be shown to be not less than the amount of Premium Liability determined in accordance with section 5.4, an Insurer may use that aggregate as a proxy for Premium Liability for the purposes of recording item 15 on this form.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.12

                Reinsurance and other recoveries in respect of claims that have not yet been incurred are reported at item 16. It is necessary to estimate this balance. The basis on which the estimate is made must be consistent with the basis of estimation of the Related liability, reported at item 15.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.13 PIN 6.14.13

                Where, in determining the amount to be reported at item 14, an Insurer has made or considered making a provision for doubtful debt in respect of recoveries due or potentially due from a reinsurer, the Insurer must take into account the potential need to make a provision when determining any estimate to be included at item 14 or 16.

                • PIN 6.14.13 Guidance

                  It is common practice for Insurers to account for their exposures on General Insurance contracts in force by means of an unearned premium provision, an asset representing deferred reinsurance expense and (where necessary) a premium deficiency reserve. Insurers are referred to the Guidance to item 15. An Insurer that uses an unearned premium provision and premium deficiency reserve as a proxy for Premium Liabilities may record its deferred reinsurance expense at item 16.


                  Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.14.14

                Item 17 represents the net value of future Policy Benefits under Long-Term Insurance contracts that are in force as at the date to which the Return is made up. The amount reported here must be determined in accordance with PIN section 5.6.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.15 PFN PIN 6.15 Statement by directors

              • PIN 6.15 Guidance

                1. The Statement by Directors forms a part of the Annual Regulatory Return or the Quarterly Regulatory Return. By providing these statements the Directors confirm that the returns have been properly prepared and that the Insurer complies with applicable prudential Rules.
                2. The Statement by Directors is set out as statements that must be made, but circumstances may arise when a statement cannot be made because it would be untrue to do so. Under such circumstances this section provides for the Directors to provide an explanation in place of the omitted statement.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.15.1

                Every Return must include a Statement by Directors, in accordance with this section.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.15.2

                The Statement by Directors forming part of the Annual Regulatory Return must State that:

                (a) the Annual Regulatory Return has been prepared in accordance with the provisions of PIN chapter 6 and this chapter;
                (b) proper accounting records have been maintained and adequate information obtained by the Insurer;
                (c) appropriate systems and controls have been established and maintained by the Insurer over its transactions and records;
                (d) the Insurer has complied with the provisions of PIN chapter 4 throughout the reporting period; and
                (e) the Insurer complies, as at the date of the statement, with those provisions of PIN that are applicable to it.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.15.3

                The Statement by Directors forming part of the Quarterly Regulatory Return must State that:

                (a) the Quarterly Regulatory Return has been prepared in accordance with the provisions of PIN chapter 6 of and this chapter; and
                (b) the Insurer complies, as at the date of the statement, with those provisions of PIN that are applicable to it.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.15.4

                If in the opinion of the Directors it would be untrue to make one or more of the statements referred to in PIN rule 6.14.1 and PIN rule 6.14.3, the statements concerned must be omitted and the Insurer must instead State in a Supplementary Note that the Directors are unable to make the statements in question, and must give the reasons for that inability.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

            • PFN PIN 6.16 PFN PIN 6.16 Interpretation of terms in form 2

              • PIN 6.16 Guidance

                1. This section provides the necessary mechanism to apply the relevant factors in the calculation of the Insurer’s capital adequacy position, for each type of Return, when preparing form 2. Form 2 is not prepared in the case of a DIFC Business Return.
                2. This section sets out in tabular form the cross-references between the terms used on form 2 and the meanings that must be given to those terms for each type of Return.

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.16.1

                For the purposes of form 2, the meaning that must be given to each of the terms set out in the leftmost column of the table below for each type of Return is contained in the column headed by that type of Return.


                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

              • PIN 6.16.2

                Where a term does not apply to a type of Return, this is denoted by the characters ‘N/A’ and this item must be left blank on the form.

                Meaning of term for each type of Return
                Item no. Term used in form Global Return (all Insurers except Protected Cell Companies) Global Return (Protected Cell Companies) Cell Return Fund Return
                1 Base capital Base capital as defined in PIN rule A3.3.1 Base non-cellular capital as defined in PIN rule A5.3.1 Base cellular capital as defined in PIN rule A5.7.1 Base fund capital as defined in PIN rule A7.3.2
                3 Adjusted equity AE as defined in PIN rule A3.2.1 ANE as defined in PIN rule A5.2.1 ACE as defined in PIN rule A5.6.1 AFE as defined in PIN rule A7.2.1
                4 Hybrid Capital Adjustment HCA as defined in PIN rule A3.2.1 HNCA as defined in PIN rule A5.2.1 HCCA as defined in PIN rule A5.6.1 FHCA as defined in PIN rule A7.2.1
                5 Adjusted Capital Resources ACR as defined in PIN rule A3.2.1 ANCR as defined in PIN rule A5.2.1 ACCR as defined in PIN rule A5.6.1 AFCR as defined in PIN rule A7.2.1
                6 Minimum Capital Requirement MCR as defined in PIN rule A4.2.1 MSCR as defined in PIN rule A6.2.2 MSCR as defined in PIN rule A6.2.2 MFCR as defined in PIN rule A8.2.1
                6.1 Default risk component DRC as defined in PIN rule A4.2.1 DRC as defined in PIN rule A6.2.2 DRC as defined in PIN rule A6.2.2 DRC as defined in PIN rule A8.2.1
                6.2 Investment volatility risk component IVRC as defined in PIN rule A4.2.1 IVRC as defined in PIN rule A6.2.2 IVRC as defined in PIN rule A6.2.2 IVRC as defined in PIN rule A8.2.1
                6.3 Off-balance sheet asset risk component OARC as defined in PIN rule A4.2.1 OARC as defined in PIN rule A6.2.2 OARC as defined in PIN rule A6.2.2 OARC as defined in PIN rule A8.2.1
                6.4 Off-balance sheet liability risk component OLRC as defined in PIN rule A4.2.1 OLRC as defined in PIN rule A6.2.2 OLRC as defined in PIN rule A6.2.2 OLRC as defined in PIN rule A8.2.1
                6.5 Concentration risk component CRC as defined in PIN rule A4.2.1 CRC as defined in PIN rule A6.2.2 CRC as defined in PIN rule A6.2.2 CRC as defined in PIN rule A8.2.1
                6.6 Size factor adjustment SFAC as defined in PIN rule A4.2.1 SFAC as defined in PIN rule A6.2.2 SFAC as defined in PIN rule A6.2.2 SFAC as defined in PIN rule A8.2.1
                6.7 Underwriting risk component URC as defined in PIN rule A4.2.1 N/A URC as defined in PIN rule A6.2.2 N/A
                6.8 Reserving risk component RRC as defined in PIN rule A4.2.1 N/A RRC as defined in PIN rule A6.2.2 N/A
                6.9 Long-Term Insurance risk component LIRC as defined in PIN rule A4.2.1 N/A LIRC as defined in PIN rule A6.2.2 LIRC as defined in PIN rule A8.2.1
                6.10 Asset management risk component AMRC as defined in PIN rule A4.2.1 AMRC as defined in PIN rule A6.2.2 AMRC as defined in PIN rule A6.2.2 AMRC as defined in PIN rule A8.2.1
                7 Absolute minimum requirement applicable to reporting unit Absolute minimum requirement applicable to reporting unit The amount set out in PIN rule A6.2.4 or, if higher, the MSCR as defined in PIN rule A6.2.2 plus any amount that must be added to that amount pursuant to PIN rule A6.2.6 The amount set out in PIN rule A6.2.5 The amount set out in PIN rule A8.2.3

                Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]

        • PFN 7 PFN 7 PIN Forms

          Not in use — see new PRU sourcebook

          • Not in use — see new PRU Sourcebook

            • PFN PIN 1 Statement of Financial Position

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIN 2 Statement of Calculation of Capital Adequacy

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIN 3 Statement of Financial Performance

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIN 4 Statement of Premiums and Reinsurance Expense

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIN 5 Statement of Claims and Reinsurance and other Recoveries

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIN 6 Statement of Movements in Insurance Provisions

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIN 7 Statement of Investment Income

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIN 8 Statement of Acquisition Expenses

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIN 9 Reconciliation to Financial Statements

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

            • PFN PIN 10 Summary Statement of Operations

              Please download the Form in PDFPDF format.


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

        • PFN 8 PFN 8 GEN Forms

          Not in use — see new AFN sourcebook

          [Amended][VER5/04-06]

          • Not in use — see new AFN sourcebook

            • PFN GEN 1 Application for registration as an auditor

              Please download the Form in PDFPDF format.

              Purpose of this form

              An Audit Firm wishing to apply for registration as an auditor must submit this form.

              Contents

              This form consists of three sections:

              1. Audit Firm details
              2. Declaration and signature
              3. Attachments

              Notes for completing this form

            • Questions must be fully answered and the use of abbreviations should be avoided.


            • Answers must be typed and the form must be signed by the Audit Firm’s Senior Partner or equivalent.


            • Please ensure any supporting documentation is clearly labelled and securely attached.


            • When completed, submit this application form in line with SUP chapter 8.


            • The address for postal submission is:

              DUBAI FINANCIAL SERVICES AUTHORITY
              AUTHORISATION DEPARTMENT
              LEVEL 13, THE GATE
              PO BOX 75850
              DUBAI, UAE


              Derived from DFSA RM11/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended][VER4/06-05]

        • PFN 9 PFN 9 AMI Forms

          Not in use — see new AFN sourcebook

          [Amended][VER5/04-06]

          • Not in use — see new AFN sourcebook

            • PFN AMI 1 Reporting Return Coversheet

              Please download the Form in PDFPDF format.

              [Added][VER4/06-05]

            • PFN AMI 2 Application for a Waiver

              Please download the Form in PDFPDF format.

              Purpose of this form

              An Authorised Market Institution wishing to apply for a waiver of a Rule must submit this form.

              Contents

              This form consists of six sections:

              1. Authorised Market Institution details
              2. Details of waiver sought
              3. Research and reasons
              4. Publication
              5. Additional information
              6. Declaration and signature

              Notes for completing this form

              •  Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA's Rulebook.
              •  Sections 1, 2, 3, 4 and 6 must be completed.
              •  Please use section 5 if you wish to provide additional information that may clarify or support your answers in sections 1-4.
              •  Questions must be fully answered and the use of abbreviations should be avoided.
              •  Answers must be typed and the form must be signed by either the Authorised Market Institution’s relevant Key Individual or Director.
              •  Please ensure any supporting documentation is clearly labelled and securely attached.
              •  When completed, submit this application form in line with SUP chapter 3. You may send applications by post or hand delivered and addressed to your usual market contact.

              The address for postal submission is:

              DUBAI FINANCIAL SERVICES AUTHORITY
              AUTHORISATION DEPARTMENT
              LEVEL 13, THE GATE
              PO BOX 75850
              DUBAI, UAE

              •  You can inspect published waivers on the DFSA website: www.dfsa.ae
              [Added][VER4/06-05]

            • PFN AMI 3 Applications and Notifications Concerning a Change in Control

              Please download the Form in PDFPDF format.

              Purpose of this form

              This form must be submitted by an Authorised Market Institution applying for approval from or notifying the DFSA concerning a change in control of the Authorised Market Institution. This form may also be used by a Controller.

              Authorised Market Institutions are required to complete a form for each application or notification.

              An Authorised Market Institution or Controller must submit an application or notification, as applicable, concerning a change in control, at least 28 days in advance of the proposed change, or immediately upon becoming aware of a proposed or actual change in control.

              Contents

              This form consists of six sections:

              1. Controllers – individuals
              2. Controllers – undertakings
              3. Details of new control or change in level of control
              4. Additional information
              5. Declaration
              6. Attachments

              Notes for completing this form

              •  Defined terms are identified throughout this form by the capitalisation of the initial letter of a word or phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook.
              •  Section 1 must be completed if the application/notification of a change in control relates to an individual.
              •  Section 2 must be completed if the application/notification of a change in control relates to an undertaking.
              •  Section 3 and 5 must be completed in respect of all applications/notifications.
              •  Please use section 4 if you wish to provide additional information that may clarify or support your answers in sections 1-3.
              •  Questions must be fully answered and the use of abbreviations should be avoided.
              •  Answers must be typed and the form must be signed by the Authorised Market Institution’s relevant Key Individual, Director or the relevant Controller.
              [Added][VER4/06-05]

    • Prudential Returns Module (PRU-EPRS)

      PRU-EPRS/VER1/12-07PRU-EPRS/VER1/12-07

      • Prudential Returns Module (PRU) [VER4/09-07]

        The Prudential Returns Module was amended by GM5/2007 and replaced by PRU-EPRS [VER1/12-07].

        • PRU 1 PRU 1 Introduction

          • PRU 1.1 PRU 1.1 Application

            • PRU 1.1.1 Deleted

              [Deleted] DFSA RM44/2007 (Made 1st June 2007). [VER2/06-07]

            • Guidance

              1. This Sourcebook (PRU) is relevant to a Person to whom PIB or PIN applies.
              2. Chapter 2 contains the forms referred to in PIB.
              3. Chapter 3 contains instructional guidelines in respect of the forms in Chapter 4.
              4. Chapter 4 contains the forms referred to in PIN.
              Derived from DFSA RM44/2007 (Made 1st June 2007). [VER2/06-07]

          • PRU 1.2 PRU 1.2 Defined terms

            • Guidance

              Defined terms are identified throughout the forms by the capitalisation of the initial letter of a word or each word of a phrase and are defined in the Glossary module (GLO) of the DFSA’s Rulebook. Unless the context otherwise requires, where capitalisation of the initial letter is not used, an expression has its natural meaning.

              Derived from DFSA RM44/2007 (Made 1st June 2007). [VER2/06-07]

            • PRU 1.2.1 Deleted

              [Deleted] DFSA RM44/2007 (Made 1st June 2007). [VER2/06-07]

        • PRU 2 PRU 2 PIB Forms

          • PRU 2.1 PRU 2.1 Forms PIB 1–100

            Purpose of these forms

            An Authorised Firm must submit the appropriate forms contained in this chapter in accordance with its category as defined in PIB appendix 7 and at the frequency stated in that appendix.

            Notes for completing these forms

            •   All figures must be typed and the declaration (in form PRU PIB10) signed by the person authorised to sign the return in accordance with PIB Rule 1.6.1.
            •   The Authorised Firm's name, licence number and reporting period should be identified on each form.
            •   Unless otherwise agreed with the DFSA, the Authorised Firm or Group's reporting currency must be in US Dollars.
            •   Within the forms 'N' represents the reports for the current period and 'N-1' should contain figures provided in the previous period's reporting statements. For the avoidance of doubt, for a reporting statement that is made on a quarterly basis, 'N-1' will be represent the previous quarter's comparators, whereas for an annual reporting statement, 'N-1' will be the prior year's reporting statement.
            •   Figures that related to expenses, losses or other negative amounts should be entered in brackets '(xxx)'.
            •   Forms must be presented in the English language.
            •   Authorised Firms are reminded that instructional guidelines are provided in form PRU section 2.2 which provides further detail on individual sections and boxes of the forms.
            •   When completed, submit the forms in line with SUP chapter 8. You may send applications by post or hand delivered and addressed to your usual supervisory contact.

            The address for postal submission is:

            DUBAI FINANCIAL SERVICES AUTHORITY
            SUPERVISION DEPARTMENT
            LEVEL 13, THE GATE
            PO BOX 75850
            DUBAI, UAE

            Amended from DFSA GM/2/2007 (Made 5 July 2007). [VER3/08-07]

            • PRU PIB1 PRU PIB1 Balance Sheet

              Please download the Form in PDFPDF format.

              • PRU PIB1 Appendix 1 — Detail of Non-Trading Book Assets

                Please download the Form in PDFPDF format.

              • PRU PIB1 Appendix 2 — Detail of Non-Market Risk in the Trading Book

                Please download the Form in PDFPDF format.

              • PRU PIB1 Appendix 3 — Detail of Market Risk in the Trading Book

                Please download the Form in PDFPDF format.

              • PRU PIB1 Appendix 4 — Calculation of DCR

                Please download the Form in PDFPDF format.

            • PRU PIB2 PRU PIB2 Islamic Business — Balance Sheet

              Please download the Form in PDFPDF format.

              • PRU PIB2 Appendix 1 — Detail of Non-Trading Book Self-Financed Assets

                Please download the Form in PDFPDF format.

              • PRU PIB2 Appendix 2 — Detail of Non-Trading Book Assets Financed by Unrestricted PSIAs

                Please download the Form in PDFPDF format.

              • PRU PIB2 Appendix 3 — Detail of Non-Trading Book Assets Financed by Restricted PSIAs

                Please download the Form in PDFPDF format.

              • PRU PIB2 Appendix 4 — Detail of Non Market Risk in the Trading Book — Self-Financed

                Please download the Form in PDFPDF format.

              • PRU PIB2 Appendix 5 — Detail of Non Market Risk in the Trading Book — PSIAU Financed

                Please download the Form in PDFPDF format.

              • PRU PIB2 Appendix 6 — Detail of Non Market Risk in the Trading Book — PSIAR Financed

                Please download the Form in PDFPDF format.

              • PRU PIB2 Appendix 7 — Detail of Market Risk in the Trading Book

                Please download the Form in PDFPDF format.

              • PRU PIB2 Appendix 8 — Islamic — Calculation of DCR

                Please download the Form in PDFPDF format.

              • PRU PIB2 Appendix 9 — Analysis of Reserves Movement

                Please download the Form in PDFPDF format.

            • PRU PIB3 Profit and Loss Statement

              Please download the Form in PDFPDF format.

            • PRU PIB4 Profit and Loss Statement for Islamic Financial Institutions

              Please download the Form in PDFPDF format.

            • PRU PIB5 Expenditure Based Capital Minimum — Solo

              Please download the Form in PDFPDF format.

            • PRU PIB6 Capital Adequacy Calculation — Solo

              Please download the Form in PDFPDF format.

            • PRU PIB7 PRU PIB7 Large Exposures

              Please download the Form in PDFPDF format.

              • PRU PIB7 Appendix 1 — Detail of Largest 25 Exposures by Contract Type

                Please download the Form in PDFPDF format.

            • PRU PIB8 Liquidity Schedule — Maturity Mismatch

              Please download the Form in PDFPDF format.

            • PRU PIB9 PRU PIB9 Branch Return

              Please download the Form in PDFPDF format.

              • PRU PIB9 Appendix 1 Largest Exposures Undertaken Out of the Branch

                Please download the Form in PDFPDF format.

            • PRU PIB10 Declaration by Authorised Firm

              Please download the Form in PDFPDF format.

            • PRU PIB12 Geographical Distribution of Assets and Liabilities

              Please download the Form in PDFPDF format.

              [Added] DFSA GM4/2007 (Made 13th September 2007). [VER4/09-07]

            • PRU PIB13 Provisions for Impairment

              Please download the Form in PDFPDF format.

              [Added] DFSA GM4/2007 (Made 13th September 2007). [VER4/09-07]

            • PRU PIB14 Exposures in Arrears

              Please download the Form in PDFPDF format.

              [Added] DFSA GM4/2007 (Made 13th September 2007). [VER4/09-07]

            • PRU PIB100 PRU PIB100 Statement of Financial Group Capital Adequacy

              Please download the Form in PDFPDF format.

              [Added] DFSA GM3/2007 (Made 5th July 2007). [VER15/07-07]

              • PRU PIB100 App1 Continuation Sheet

                Please download the Form in PDFPDF format.

                [Added] DFSA GM3/2007 (Made 5 July 2007). [VER15/07-07]

          • PRU 2.2 PRU 2.2 PIB Instructional Guidelines

            Please download the guidelines in PDFPDF format.

            • PRU 2.2.1 Guidance for form PIB1 — Balance Sheet (Conventional Authorised Firms)

              Instructional Guidelines

              Item No. Item Guidance
              1.1.1 Cash and Balances with Central Banks Include, for example, the following amounts:
              •   Notes and coins;
              •   Long positions in Gold bullion (including Tola Bars);
              •   Amounts placed with central banks including funds required to be placed on deposit with central banks and monetary authorities.
              1.1.2 Treasury bills and other eligible bills Treasury bills issued by the national governments or by the Central banks on behalf of the governments. Also include bills issued by other entities, which are eligible for rediscounting with the central bank.
              1.1.3 Money market placements Include deposits at call and other money market placements with banks or other money market participants
              1.2.1 Trading securities Include investments acquired principally for the purpose of selling or repurchasing them in the near term for short-term-profit-taking. This would include but not limited to, debt, equity and hybrid instruments
              1.2.2 Derivative financial instruments Include, but are not limited to, positions representing the following instruments, recorded at fair value:

              Forward and Futures contracts in Currencies, Interest rates and other financial assets
              Forward rate agreements
              Currency and interest rate swaps
              Credit derivatives
              Option contracts on currency, interest rate and other financial assets.

              These derivatives include both the exchange-traded and over-the-counter versions.
              1.2.3 Other financial instruments at fair value through profit and loss Include all financial instruments which are, upon initial recognition, designated by the entity as financial assets to be measured at fair value through profit or loss other than the trading securities included in 1.2.1.
              1.2.4 Investment securities — available for sale Include non-derivative financial assets that are designated as available for sale by the firm or that have not been classified under any of the other categories of investment in section 1.2.
              1.2.5 Investment securities - held to maturity Include non-derivative financial assets with fixed or determinable payments and fixed maturity that the firm has positive intention and ability to hold to maturity.
              1.2.6 Investments in associated undertakings Include investments in entities, including unincorporated entities such as partnerships, over which the firm has significant influence and where the entity in question is neither a subsidiary nor a joint venture operation
              1.3 Loans and advances Amounts arising from, for example:
              •   Revolving credit facilities;
              •   Credit cards outstanding balances;
              •   Housing loans (both variable and fixed rates);
              •   Term loans (both variable and fixed rates);
              •   The book value of assets leased out under finance lease agreements;
              •   Loans made under conditional hire purchase contracts;
              •   Advances purchased by or assigned to the reporting institutions, factoring or similar arrangements
              •   Other loans and advances.

              The amounts reported should be gross of provisions (as specific and general provisions should be reported in the Liabilities section of the balance sheet) and net of interest receivable.
              1.4.1 Murabaha and Istina'a receivables Report here all receivables relating to Murabaha and Istisna'a contracts. Refer to FAS 2 and FAS 10 of AAOIFI respectively.
              1.4.2 Ijarah assets and receivables Include Ijarah assets net of depreciation/ amortisation and Ijarah receivables. Refer to FAS 8 of AAOIFI.
              1.4.3 Mudaraba Financing Capital provided on a Mudaraba basis should be reported here. Refer to FAS 3 of AAOIFI.
              1.4.4 Musharaka Financing Report capital provided on a Musharaka basis. Refer to FAS 4 of AAOIFI. Investment in the share capital of another company should be reported under "Other", Form PIB 1, Item No. 1.4.5.
              1.4.5 Other investments Include any other investments undertaken through Islamic contracts, including Parallel Istisna'a assets (refer FAS 10 of AAOIFI) and capital provided on Salam contracts (refer FAS 7 AAOIFI).
              1.5 Fixed assets Include, for example, the value of the following:
              •   Plant and equipment, the residual value of items leased out under an operating lease (excluding balances relating to named Ijarah assets which should be included separately in Form PIB 1, Item No. 1.4.2);
              •   Own premises being occupied or developed for occupation by the Authorised Firm, property (excluding property acquired / held available for sale which should be included in "Other Assets", Form PIB 1, Item No. 1.7).

              The amounts reported here should be net of accumulated depreciation and amortisation.
              1.6.1 Goodwill Include amounts relating to any purchased goodwill.
              1.6.2 Other intangible assets Items to be included:
              •   Capitalised development costs
              •   Brand names, trademarks and similar rights
              •   Licences and exchange seats which may be held as part of the Authorised Firm's trading requirement.
              1.7 Other assets Assets that have not been included in any of the items above. In particular, positions in short term securities held with the intention of resale, sundry debtors, prepayments and accrued income not identified elsewhere.
              1.9.1 Direct credit substitutes These relate to the financial requirements of counterparty where the risk of loss to the Authorised Firm on the transaction is equivalent to a direct claim on the counterparty. Include here
              •   Guarantees of a financial nature to stand behind the current obligations of customers (e.g. loan guarantees);
              •   Guarantees of leasing operations;
              •   Letters of Credit and Stand-by Letters of Credit to the extent that they do not qualify for inclusion in Item No. 1.9.3 "Trade related contingents" below;
              •   Guarantees of a capital nature such as undertakings given to a non bank financial company which are considered as capital by the appropriate regulatory body. Guarantees given to a company not connected to the reporting institution should be risk weighted at 100% and those for connected companies should be deducted from the reporting institution's capital base.
              •   Acceptances granted and risk participation in bankers' acceptances. Where the reporting institution's own acceptances have been discounted by that institution the nominal value of the bills held should be deducted from the nominal amount of the bills issued under the facility and a corresponding on balance sheet entry made.
              1.9.2 Transaction related contingents These exposures relate to the on-going trading activities of a counterparty where the risk of loss to the reporting institution depends on the likelihood of a future event which is independent of the creditworthiness of the counterparty. They are essentially guarantees that support particular non financial obligations rather than a customer's financial obligations. Include here:
              •   Advance payment guarantees
              •   Performance bonds including bid or tender bonds, warranties and indemnities (indemnities given for lost share certificates or bills of lading and guarantees of the validity of papers rather than of payment under certain conditions should be reported here);
              •   Stand by Letters of Credit relating to a particular contract or to non financial transactions (including arrangements backing, inter alia, subcontractors' and supplier's performance, labour and materials, contracts and construction bids).
              1.9.3 Trade related contingents Report short term self-liquidating trade related items such as documentary letters of credit issued by the reporting institution that are collateralised by the underlying shipment i.e. the credit provides for the reporting institution to retain title to the underlying shipment. L/C's issued without provision for the reporting institution to retain title to the underlying shipment should be reported under direct credit substitutes above.
              1.9.4 Sale and Repurchase Agreements Only report here sale and repurchase agreements where the asset sold is not reported on the balance sheet. Where the asset is off balance sheet, the appropriate counterparty weighting is determined by the issuer of the security and not according to the counterparty with whom the transaction has been undertaken.
              1.9.5 Forward Assets Purchases The appropriate counterparty weighting should be determined by the asset to be purchased and not the counterparty with whom the contract has been entered into. Include commitments for loans and other on balance sheet items with certain drawdown. Exclude foreign currency spot deposits with value date of up to two working dates after trade date.
              1.9.6 Forward Deposits Placed Relates to agreements between two parties whereby one will pay and the other receive an agreed rate of interest on a deposit to be placed by one with the other at some pre-determined rate in the future. The weight should be determined according to the counterparty with whom the deposit will be placed. Exclude foreign currency spot deposits with value date of up to two working dates after trade date.
              1.9.7 Uncalled partly-paid shares and securities Only include here if there is a specific date for a call. If there is no specific date for a call, the item should be included as a long term commitment under PIB 1 Item No. 1.9.10, "Other Commitments".
              1.9.8 NIF's and RUF's Note issuance and revolving underwriting facilities should include the reporting institutions underwriting obligations of any maturity. Where the facility has been drawn down by the borrower and the notes are held by someone other than the Authorised Firm, the underwriting obligation should continue to be reported at the nominal amount.
              1.9.9 Endorsement of Bills These should be reported at the full nominal amount, less any amount for bills which the institution now holds but had previously endorsed. Endorsement of bills not accepted by banks will attract the counterparty risk weighting of the issuer. If it has been endorsed by another bank, a reduced risk weighting applies.
              1.9.10 Other Commitments All other undrawn commitments are reportable here, divided into commitments under and over one year.
              1.9.11 Assets funded by restricted PSIAs The methodology for calculating exposures financed by PSIAs are, in principle, no different to calculating exposures for a reporting institution's self financed assets. All the guidance notes above apply in their entirety unless stated otherwise.
              1.10 Deposits Separately identify deposits due to the financial institutions in PIB 1 Item No. 1.10.1. All other deposits are to be reported in the other deposit section, PIB 1 Item No. 1.10.2.
              1.11 Tax Liability Report all items accrued and payable in respect of the Authorised Firm's current and future tax liabilities.
              1.12 Provisions All specific and general provisions in respect of Loans and Advances and other receivables should be reported here. Exclude provisions against Islamic contracts which should be reported in PIB 1 Item No. 1.14.4 below.
              1.13 Loan Capital and Hybrid Securities Report items such as subordinated loans drawn down by the Authorised Firm.
              1.14 Liabilities arising from Islamic contracts Liabilities arising from Islamic contracts include advances received against Salam contracts (defined in Para 3 and 19 of FAS 7 issued by AAOIFI and Ijarah investment payables (refer to FAS 8 of AAOIFI). Report any provisions against Islamic contracts in item Form PIB 1, Item No. 1.14.4.
              1.15.1 Creditors and other liabilities Report all items not included in any of the above, such as proposed dividends payable, sundry accruals and deferred income etc.
              1.15.2 Derivative financial instruments and other trading liabilities Include, but are not limited to, liabilities arising out of positions representing the following instruments, recorded at fair value:

              Forward and Futures contracts in Currencies, Interest rates and other financial assets
              Forward rate agreements
              Currency and interest rate swaps
              Credit derivatives
              Option contracts on currency, interest rate and other financial assets.

              These derivatives include both the exchange-traded and over-the-counter versions.
              1.17.1 Liabilities relating to Restricted PSIA Enter here the aggregate liabilities arising from the assets of restricted PSIA investment funds.
              1.17.2 Other Enter the aggregate of all other off balance sheet liabilities here
              1.18.1 Ordinary Shares Include in respect of this item the amount of ordinary share capital issued, reported at nominal paid up value. Do not report the unpaid element of partly paid shares or authorised but unissued share capital. Authorised Firms should exclude holdings in their own shares.
              1.18.2 Preference Shares Fixed dividend share capital that ranks above ordinary shares in the event of liquidation. Report the value of the preference shares issued.
              1.18.3 Partnership Capital and other Include here other types of equity which have the same properties of permanent share capital. This could include partnership capital accounts, capital items for unincorporated associations etc.
              1.20 Share premium account Any amounts received by the authorised institution in excess of the nominal paid up value.
              1.21.1 Asset revaluation reserve Enter amounts arising from the revaluation of assets for which it has been necessary to set up this reserve.
              1.21.2 Goodwill and other reserves Enter amounts arising from purchased goodwill or other situations for which it has been necessary to set up this or any other reserve.
              1.21.3 Investment Risk Reserve Prudential category 5 Authorised Firms should include in respect of this item the amount that is appropriated out of the income of investment account holders, after allocating the Mudarib share, in order to meet future losses attributable to investment account holders. Refer also to FAS 11 of AAOIFI.
              1.21.4 Profit Equalisation Reserve Prudential category 5 Authorised Firms should include in respect of this item the amount appropriated out of the Mudaraba income, before allocating the Mudarib share, in order to maintain a certain level of investment returns for investment account holders and to increase owners' equity. Refer also to FAS 11 of AAOIFI.
              1.22 Total Reserves Sum of PIB 1 Item Nos. 1.21.1 + 1.21.2 + 1.21.3 + 1.21.4.
              1.24 Minority Interests Report amounts attributable to minority shareholders from the overall equity figure.
              1.25 Total shareholders' equity Sum of PIB 1 Item Nos. 1.19 + 1.20 + 1.22 - 1.24.
              1.26 Total liabilities and shareholders' equity Sum of PIB 1 Item Nos. 1.16 + 1.25
              1.27 Client Money held or controlled by the Authorised Firm Total of all Client Money, as per COB 9.3, as at the reporting date.
              1.27.1 of which, belonging to Segregated Clients Subset of Item No. 1.27 above.
              The term Segregated Client is defined in COB A5.2.1(2).
              1.28 Total Client Money held in Client Accounts Total of all Client Money held in Client Accounts as at the reporting date.
              The term Client Account is defined in COB A5.4.1.
              1.29 Insurance Monies held or controlled by the Authorised Firm Total of all Insurance Monies, as per COB 14.2, as at the reporting date.
              1.29.1 Of which, segregated Subset of Item No. 1.29 above.
              Insurance Monies segregation is detailed in COB 14.3. Segregated Insurance Monies is the total of all Insurance Monies less that amount affected by COB 14.3.12.
              1.30 Total Insurance Monies held in Insurance Bank Accounts Total balance of all Insurance Monies held in Insurance Bank Accounts as at the reporting date. The term Insurance Bank Account is explained in COB 14.3.

            • PRU 2.2.2 Guidance for Form PIB 1 — Appendix 1 — Detail of risk weighted assets

              Instructional Guidelines

              Authorised Firms are referred to PIB Chapter 4 and PIB Appendix 4 to understand the background to risk weighting assets in the non trading book. In particular, PIB Section A4.3 contains detailed requirements in respect on weighting exposures in the appropriate risk buckets. If an Authorised Firm is uncertain as to where to classify a particular exposure, it should contact DFSA to obtain this clarity. Particular care should be taken for exposures classified in anything other than the 100% risk weighting category.

              Among other things, risk weightings may be reduced on non trading book items by obtaining a guarantee from a third party or a party connected to the Authorised Firm (the "guarantor"). Provided the conditions laid out in Rules PIB A4.3.1 to PIB A4.3.4 are met, the Authorised Firm may opt to use the counterparty weighting of the guarantor where this risk weighting is less than that for the underlying counterparty.

              Item No. Item Guidance
              1.A1.2.3 Mortgage backed securities Investments in mortgage backed securities only attract a 50% rating provided the conditions set out in PIB Rule A4.3.6 are met in its entirety.
              1.A1.4 Assets arising from Islamic contracts In respect of counterparty weightings for exposures in the non trading books, Authorised Firms are referred Rules PIB 3.5.1 to PIB 3.5.5. In particular, attention is drawn to the weightings referred to in table 2 by Islamic contract type. Authorised Firms are reminded that in the event of any doubt in this area, they should contact the DFSA for clarification.
              1.A1.4.5 Other investments Include all other investments arising from Islamic contracts not referred to above.
              1.A1.9 Off balance sheet items Details of Credit Conversion Factors are set out in Rules PIB A4.3.10 to PIB A4.3.14. Authorised Firms are reminded to be cautious in capturing off balance sheet exposures and to refer any matters of uncertainty to DFSA for greater clarification.
              1.A1.9.4 Sale and Repurchase Agreements Attention is drawn to Rules PIB A4.3.15 to PIB A4.3.17 which note that the counterparty weight of a repo agreement is by reference to the issuer of the asset subject to the agreement and not to the counterparty to the repurchase agreement. The weight on a reverse repo is determined as if it were a collateralised loan to a counterparty
              1.A1.9.10 Other commitments Authorised Firms are referred to the detail of Rules PIB A4.4.1 to PIB A4.4.7 in respect of determining the maturity of commitments where they have been renegotiated or are linked commitments.
              1.A1.11 OTC derivative contracts The calculation of the Credit Equivalent Amount is set out in PIB Rule A4.5.12. Authorised Firms are referred to the table in PIB Rule A4.5.14 which sets out the calculation of Potential Future Credit Exposures with details of how to net them set out in PIB Rule A4.9.1.
              1.A.12 CRCOM CRCOM is derived by multiplying the sum of risk weighted assets from the non trading book and exposures arising from OTC derivative contracts in the same book by 8%. The number here is transferred to Form PIB 6, Item No. 6.23.

            • PRU 2.2.3 Guidance for Form PIB 1 — Appendix 2 — Non-market risk in the Trading Book

              Instructional Guidelines

              The details for calculating the exposures on these risks is set out in PIB Section A4.5 which is the Appendix relating to Credit Risk.

              Item No. Item Guidance
              1.A2.2 OTC derivatives For OTC derivatives, attention is drawn to PIB Rule A4.5.3 which states that the maximum weighting is limited to 50%.
              1.A2.3 Repos and Reverse Repos For the counterparty weights on Repos and Reverse Repos, attention is drawn to the Instruction Guidance relating to Form PIB 1, Item No. 1.9.4.
              1.A2.4 Total counterparty risk requirement for non market risk in the trading book The total counterparty risk requirement for non market risk in the trading book ("CPCOM") is the sum of the capital charges arising from Delivery Versus Payment transactions, Free Deliveries, OTC Derivatives, Repos, Reverse Repos and Deferred Settlement Transactions. The figure here should be transferred to Form PIB 6, Item No. 6.32.

            • PRU 2.2.4 Guidance for Form PIB 1 — Appendix 3 — Market Risk in the Trading Book

              Instructional Guidelines

              DFSA acknowledges that even for Authorised Firms with relatively straightforward exposures on the trading books, the underlying calculations for various market risks can be detailed and complex. DFSA requires only the summary numbers to be reported but expects Authorised Firms to maintain detailed audit trails that substantiate the risk requirements. Authorised Firms are also reminded that they should make this information available for review as and when required.

              In the event of any uncertainty, Authorised Firms are advised to contact their supervisor for clarity. Authorised Firms are asked to review the material set out PIB Appendix 5 with care given the multiplicity of methods that can be used to calculate the capital requirement on interest rate risk, equity risk, FX risk, Commodities risk Options Risk and Securities Underwriting Risk.

              Where Authorised Firms intend to use internally developed market risk models for the purposes of valuing positions and calculating capital requirements, particular attention is drawn to PIB Section A5.8 and the qualitative criteria.

              Item No. Item Guidance
              1.A3.1.4,
              1.A3.2.4,
              1.A3.4.4
              1.A3.5.4
              1.A3.6
              Various risk requirements An Authorised Firm's total trading book capital requirement is as defined in PIB Rule 2.8.3. With the exception of the foreign exchange risk requirement, the total risk requirements as calculated for interest rate, equity, Commodities, Options and Securities Underwriting transactions are to be transferred to Form PIB 6 under the section titled Trading Book Capital requirement (Item Nos. 6.33–6.37).
              1.A3.3 Foreign exchange risk requirement The Foreign Exchange risk capital requirement is included in the Form PIB 6 under the Non Trading Book Capital requirement and should be transferred to Item No. 6.24 (PIB Rule 2.8.3 refers).
              1.A3.10 Total trading book capital requirement The total Trading Book Capital requirement here should be transferred to the Form PIB 6, Item No. 6.38.

            • PRU 2.2.5 Guidance for Form PIB 1 — Appendix 4 — Calculation of the DCR

              Instructional Guidelines

              DCR is defined in PIB Section 3.4 and is calculated only in respect of the PSIA funded assets. Whilst the end calculation is relatively straightforward, DFSA acknowledges that the details required to derive the final figure will be extensive depending on the size of the PSIA funded asset base.

              For Authorised Firms providing services through Islamic Windows, DFSA has not asked Authorised Firms to identify in detail the credit and market risks arising from positions in both the trading and non trading book and on and off balance sheet. Instead, Authorised Firms are required to report the numbers in summary form and are reminded that they must make the information available for review as and when required.

              Item No. Item Guidance
              1.A.4.1.1
              1.A.4.1.2
              CPCOM
              CRCOM
              CPCOM and CRCOM are calculated in accordance with Sections PIB 4.3 and PIB 4.4. The risk weightings of the assets in Islamic contracts are derived from PIB Section 3.5 and for all other assets via the appropriate Rules primarily in PIB Chapter 4 and PIB Appendix 4. Refer to previous guidance on Form PIB 1, Appendices 1 and 2 which will be relevant here.
              1.A.4.1.3 Total
              PSIACOM
              Credit
              Total PSIACOM Credit is the sum of CPCOM and CRCOM for PSIA assets.
              1.A.4.2 PSIACOM
              Market
              PSIACOM Market is the sum of the capital charge for the various kinds of market risks arising in the trading book for PSIA assets. Market risks are calculated primarily with reference to PIB Chapter 5 and PIB Appendix 5.
              1.A.4.3 DCR
              calculation
              The number derived for the DCR charge should be carried over to Form PIB 6, Item Nos. 6.28.

            • PRU 2.2.6 Guidance for Form PIB 2 — Balance Sheet — Islamic Financial Institutions

              Instructional Guidelines

              There are effectively three sets of returns for Category 5 institutions. Wherever appropriate, all balance sheet captions need to identify separately if they have arisen from self financed business (including finance from Amanah and demand deposits), from the business provided by utilising the unrestricted assets of PSIA asset providers and from the restricted PSIA business. Whilst AAOIFI permits unrestricted PSIA assets to be commingled with self financed assets for balance sheet reporting purposes, the need to maintain separate records for each asset class is paramount. Restricted PSIA assets and liabilities cannot be commingled with the former and should be reported off balance sheet.

              In the event of any uncertainty, Authorised Firms are required to consult with DFSA to obtain the necessary clarity.

              Item No. Item Guidance
              2.1 Cash and Liquid Assets Include, for example, the following amounts:
              •   Notes and coins;
              •   Deposits at call;
              •   Long positions in Gold bullion (including Tola Bars);
              •   Amounts placed with central banks and other financial institutions including funds required to be placed on deposit with central banks and monetary authorities.
              2.2 Investment Securities Report long term investment securities not held with intent to trade (short term securities are reported in "Other Assets", Item No 2.7 below). Include, for example:
              •   Debt and equity issues by central banks and other financial institutions (Eurobonds, FRNs, Mortgage Backed securities, equity holdings, Sukuks etc.);
              •   Investments in subsidiaries and associated companies;
              •   Investments in the capital of other banks and financial institutions;
              •   Holdings in non financial firms of which the Authorised Firm is a controller (i.e. "Qualifying Holdings").

              Exclude any investments in certain named Islamic contracts which are included below (PIB 2 Item Nos. 2.4.1 to 2.4.7).
              2.3 Loans and Advances Amounts arising from, for example:
              •   Revolving credit facilities;
              •   Credit cards outstanding balances;
              •   Housing loans (both variable and fixed rates);
              •   Term loans (both variable and fixed rates);
              •   The book value of assets leased out under finance lease agreements;
              •   Loans made under conditional hire purchase contracts;
              •   Advances purchased by or assigned to the reporting institutions, factoring or similar arrangements
              •   Other loans and advances.

              The amounts reported should be gross of provisions (as specific and general provisions should be reported in the Liabilities section of the balance Sheet) and net of interest receivable.
              2.4.1 Murabaha and Istisna'a Receivables Report here all receivables relating to Murabaha and Istisna'a contracts. Refer to FAS 2 and FAS 10 of AAOIFI respectively.
              2.4.2 Ijarah assets Include Ijarah assets net of depreciation/ amortisation and Ijarah receivables. Refer to FAS 8 of AAOFI.
              2.4.3 Mudaraba Financing Capital provided on a Mudaraba basis should be reported here. Refer also to FAS 3 of AAOIFI.
              2.4.4 Musharaka Financing Report capital provided on a Musharaka basis. Refer to FAS 4 of AAOIFI. Investment in the Share capital of another company should be reported under "Other", Form PIB 2, Item No. 2.4.7.
              2.4.5 Salam Capital provided on Salam contract should be reported here. Refer to FAS 7 of AAOIFI.
              2.4.6 Parallel Istisna'a Parallel Istisna'a receivables/assets should be reported here. Refer to FAS 10 of AAOFI.
              2.5 Fixed Assets Include, for example, the value of the following:
              •   Plant and equipment, the residual value of items leased out under an operating lease (excluding balances relating to named Ijarah assets which should be included separately in Form PIB 2, Item No. 2.4.2);
              •   Own premises being occupied or developed for occupation by the authorised institution, property (excluding property acquired / held available for sale which should be included in "Other Assets" in Form PIB 2, Item No. 2.7).

              The amounts reported here should be net of accumulated depreciation and amortisation.
              2.6.1 Goodwill Include amounts relating to any purchased goodwill.
              2.6.2 Other intangibles Items to be included:
              •   Capitalised development costs;
              •   Brand names, trademarks and similar rights;
              •   Licences and exchange seats which may be held as part of the Authorised Firm's trading requirement
              2.7 Other Assets Assets that have not been included in any of the items above. In particular, positions in short term securities held with the intention of resale, sundry debtors, prepayments and accrued income not identified elsewhere.
              2.9.1 Direct Credit Substitutes These relate to the financial requirements of a counterparty where the risk of loss to the reporting institution on the transaction is equivalent to a direct claim on the counterparty. Essentially the risk of loss depends on the creditworthiness of the counterparty. Include here:
              •   Guarantees of a financial nature to stand behind the current obligations of customers (e.g. loan guarantees);
              •   Guarantees of leasing operations;
              •   Letters of Credit and Stand-by Letters of Credit to the extent that they do not qualify for inclusion in Item No. 2.9.3 "Trade related contingents" below;
              •   Guarantees of a capital nature such as undertakings given to a non bank financial company which are considered as capital by the appropriate regulatory body. Guarantees given to a company not connected to the reporting institution should be risk weighted at 100% and those for connected companies should be deducted from the reporting institution's capital base.
              •   Acceptances granted and risk participation in bankers' acceptances. Where the reporting institution's own acceptances have been discounted by that institution the nominal value of the bills held should be deducted from the nominal amount of the bills issued under the facility and a corresponding on balance sheet entry made.
              2.9.2 Transaction related Contingents These exposures relate to the on-going trading activities of a counterparty where the risk of loss to the reporting institution depends on the likelihood of a future event which is independent of the creditworthiness of the counterparty. They are essentially guarantees that support particular non financial obligations rather than a customer's financial obligations. Include here:
              •   Advance payment guarantees
              •   Performance bonds including bid or tender bonds, warranties and indemnities (indemnities given for lost share certificates or bills of lading and guarantees of the validity of papers rather than of payment under certain conditions should be reported here);
              •   Stand-by Letters of Credit relating to a particular contract or to non financial transactions (including arrangements backing, inter alia, subcontractors' and supplier's performance, labour and materials, contracts and construction bids).
              2.9.3 Trade related Contingents Report short term self liquidating trade related items such as documentary letters of credit issued by the reporting institution which are to be collateralised by the underlying shipment i.e. the credit provides for the reporting institution to retain title to the underlying shipment. L/C's issued without provision for the reporting institution to retain title to the underlying shipment should be reported under direct credit substitutes above.
              2.9.4 Sale and Repurchase Agreements Only report here sale and repurchase agreements where the asset sold is not reported on the balance sheet. If it is reported on the balance sheet, it should not be reported here but in the relevant on balance sheet section of the return. Where the asset is off balance sheet, the appropriate counterparty weighting is to be determined by the issuer of the security and not according to the counterparty with whom the transaction has been entered into.
              2.9.5 Forward Assets Purchases The appropriate counterparty weighting should be determined by the asset to be purchased and not the counterparty with whom the contract has been entered into. Include commitments for loans and other on balance sheet items with certain drawdown. Exclude foreign currency spot deposits with value date of up to two working dates after trade date.
              2.9.6 Forward Deposits Placed Relates to agreements between two parties whereby one will pay and the other receive an agreed rate of interest on a deposit to be placed by one with the other at some pre determined rate in the future. The weight should be determined according to the counterparty with whom the deposit will be placed. Exclude foreign currency spot deposits with value date of up to two working dates after trade date.
              2.9.7 Uncalled partly-paid shares and securities Only include if there is a specific date for a call. If there is no specific date for a call, the item should be included as a long term commitment under PIB 2 Item No. 2.9.10 "Other Commitments".
              2.9.8 NIF's and RUF's Note issuance and revolving underwriting facilities should include the reporting institutions underwriting obligations of any maturity. Where the facility has been drawn down by the borrower and the notes are held by someone other than the Authorised Firm, the underwriting obligation should continue to be reported at the nominal amount.
              2.9.9 Endorsement of Bills These should be reported at the full nominal amount, less any amount for bills which the institution now holds but had previously endorsed. Endorsement of bills not accepted by banks will attract the counterparty risk weighting of the issuer. If it has been endorsed by another bank, a reduced risk weighting applies.
              2.9.10 Other Commitments All other undrawn commitments are reportable here, divided into commitments under and over one year.
              2.9.11 OTC Derivative Contracts Counterparty risk arising in both the non-trading and trading books should be calculated with reference to the Rules in PIB Section A4.5. Amounts to be reported here are the replacement costs/ NPV of such contracts
              2.10 to 2.18.11 Assets financed by PSIAR The methodology for calculating exposures financed by PSIA assets are, in principle, no different to calculating exposures for a reporting institution's self financed assets. All the guidance notes above apply in their entirety unless stated otherwise.
              2.20 Deposits Separately identify deposits due to clearing houses in PIB 2 Item No. 2.20.1 and other financial institutions in PIB 2 Item No. 2.20.2. All other deposits are to be reported in PIB 2 Item No. 2.20.3, "Other".
              2.21 Tax Liability Report all items accrued and payable in respect of the institution's current and future tax liabilities.
              2.22 Provisions All specific and general provisions in respect of Loans and Advances and other receivables should be reported here.
              2.23.1 and 2.23.2 Liabilities arising from Islamic activities Include advances received against Parallel Salam contracts (defined in Para 3 and 19 of FAS 7 issued by AAOIFI and Ijarah investment payables (refer to FAS 8 of AAOIFI).
              2.23.3 Liabilities relating to PSIAu Enter here the aggregate of all liabilities incurred on behalf of and amounts owed to PSIAu.
              2.23.4 Other Enter all other liabilities incurred in respect of Islamic contracts.
              2.24 Creditors and other Liabilities Report all items not included in any of the above, such as proposed dividends payable, sundry accruals and deferred income etc.
              2.26.1 Liabilities relating to PSIAR Enter here the aggregate liabilities arising from the restricted assets of PSIAR.
              2.26.2 Other Enter the aggregate of all other off-balance sheet liabilities here.
              2.27.1 Ordinary Shares Include the amount of ordinary share capital issued, reported at nominal paid up value. Do not report the unpaid element of partly paid shares or authorised but unissued share capital. Authorised Firms must exclude holdings in their own shares.
              2.27.2 Preference Shares Fixed dividend share capital that ranks above ordinary shares in the event of liquidation. Report the value of the preference shares issued.
              2.27.3 Partnership Capital and other Include here other types of equity which have the same properties of permanent share capital. This could include partnership capital accounts, capital items for unincorporated associations etc.
              2.29 Share premium Account Any amounts received by the authorised institution in excess of the nominal paid up value.
              2.30.1 Asset revaluation reserve Enter amounts arising from the revaluation of assets for which it has been necessary to set up this reserve.
              2.30.2 Investment Risk Reserve Category 5 Authorised Firms should include in respect of this item the amount that is appropriated out of the income of investment account holders, after allocating the Mudarib share, in order to meet future losses attributable to investment account holders. Refer also to FAS 11 of AAOIFI.
              2.30.3 Profit Equalisation reserve Category 5 Authorised Firms should include in respect of this item the amount appropriated out of the Mudaraba income, before allocating the Mudarib share, in order to maintain a certain level of investment returns for investment account holders and to increase owners' equity. Refer also to FAS 11 of AAOIFI.
              2.30.4 Goodwill and other Enter amounts arising from purchased goodwill or other situations for which it has been necessary to set up a goodwill or other reserve.
              2.31 Total Reserves Sum of Item Nos. [2.30.1 + 2.30.2 + 2.30.3 + 2.30.4] above.
              2.33 Minority Interests Report amounts attributable to minority shareholders from the overall equity figure.
              2.34 Total shareholders' equity Sum of PIB 2 Item Nos. 2.28 + 2.29 + 2.31 - 2.33.
              2.35 Total liabilities and shareholders' equity Sum of PIB 2 Item Nos. 2.25 + 2.34.

            • PRU 2.2.7 Guidance for Form PIB 2 — Appendix 1 — Detail of Non-Trading Book Assets (self-financed)

              Instructional Guidelines

              Authorised Firms are referred to PIB Chapter 4 and PIB Appendix 4 to understand the background to risk weighting assets in the non trading book. In particular, PIB Section A4.3 contains detailed requirements in respect of weighting exposures in the appropriate risk buckets. If an Authorised Firm is uncertain as to where to classify a particular exposure, it should contact DFSA to obtain this clarity. Particular care should be taken for exposures classified in anything other than the 100% risk weight category.

              Amongst other things, risk weightings may be reduced on non trading book items by obtaining a guarantee from a third party or a party connected to the Authorised Firm (the "guarantor"). Provided the conditions laid out in PIB A4.3.1 to PIB A4.3.4 are met, the Authorised Firm may opt to use the counterparty weighting of the guarantor where this risk weighting is less than that for the underlying counterparty.

              Only enter exposures relating to self financed assets in PIB 2 Appendix 1.

              Item No. Item Guidance
              2.A1.2.3 Mortgage backed securities Investments in mortgage backed securities only attract a 50% rating provided the conditions set out in PIB Rule A4.3.6 are met in their entirety.
              2.A1.4 Assets arising from Islamic contracts In respect of counterparty weightings for exposures in the non trading books, Authorised Firms are referred Rules PIB 3.5.1 to PIB 3.5.5. In particular, attention is drawn to the weightings referred to in table 2 by Islamic contract type. Authorised Firms are especially reminded that in the event of any doubt in this area, they should contact the DFSA for clarification.
              2.A1.4.7 Other Include all other investments arising from Islamic contracts not referred to above.
              2.A1.9 Off balance sheet items Details of Credit Conversion Factors are set out in Rules PIB A4.3.10 to PIB A4.3.14. Authorised Firms are reminded to be cautious in capturing off balance sheet exposures and to refer any matters of uncertainty to DFSA for greater clarification.
              2.A1.9.4 Sale and repurchase agreements Attention is drawn to Rules PIB A4.3.15 to PIB A4.3.17 which note that the counterparty weight of a repo agreement is by reference to the issuer of the asset subject to the agreement and not to the counterparty to the repurchase agreement. The weight on a reverse repo is determined as if it were a collateralised loan to a counterparty.
              2.A1.9.10 Other commitments Authorised Firms are referred to the detail in Rules PIB A4.4.1 to PIB A4.4.7 in respect of determining the maturity of commitments where they have been renegotiated or are linked commitments.
              2.A1.12 OTC Derivative Contracts The calculation of the Credit Equivalent Amount is set out in PIB Rule A4.5.12. Authorised Firms are referred to the table in PIB A4.5.14 which sets out the calculation of Potential Future Credit Exposures with details of how to net them set out in PIB Rule A4.9.1.
              2.A1.13 CRCOM (self) CRCOM is derived by multiplying the sum of risk weighted assets from the non trading book and exposures arising from OTC derivative contracts in the same book by 8%. The number here is transferred to Form PIB 6, Item No. 6.23.

            • PRU 2.2.8 Guidance for Form PIB 2 — Appendix 2 — Detail of Non-Trading Book Assets (PSIAu)

              Instructional Guidelines

              All the guidance notes in PIB 2 Appendix 1 apply here. Only enter exposures relating to assets of the PSIAu investors.

              Item No. Item Guidance
              2.A2.13 CRCOM (PSIAu) CRCOM is derived by multiplying the sum of risk weighted assets from the non trading book and exposures arising from OTC derivative contracts in the same book by 8%. The number here is transferred to the DCR calculation in Form PIB 2, Appendix 8, Item No. 2.A8.1.2.

            • PRU 2.2.9 Guidance for Form PIB 2 — Appendix 3 — Detail of Non-Trading Book Assets (PSIAR)

              Instructional Guidelines

              All the guidance notes in PIB 2 Appendix 1 apply here. Only enter exposures relating to assets of the PSIAR investors.

              Item No. Item Guidance
              2.A3.13 CRCOM (PSIAR) CRCOM: CRCOM is derived by multiplying the sum of risk weighted assets from the non trading book and exposures arising from OTC derivative contracts in the same book by 8%. The number here is transferred to Form PIB 2, Appendix 8, Item No. 2.A8.1.2 for the DCR calculation.

            • PRU 2.2.10 Guidance for Form PIB 2 — Appendix 4 — Detail of Non-Market Risk in Trading Book (self-financed)

              Instructional Guidelines

              This Appendix relates to calculating the risk weighted capital charge for self financed assets only.

              The details for calculating the exposures on these risks is in fact set out in PIB Section A4.5 which is the Appendix relating to Credit Risk.

              Item No. Item Guidance
              2.A4.2 OTC Derivatives For OTC derivatives, attention is drawn to PIB Rule A4.5.3 which states that the weighting is calculated in accordance with PIB A4.5.3 except that the maximum weighting is limited to 50%.
              2.A4.2.3 and 2.A4.2.4 Repos & reverse repos For the counterparty weights on Repos and Reverse Repos, refer also to the guidance notes relating to Form PIB 2, Item No. 2.9.4.
              2.A4.4 Total capital requirement for non-market risk in the (PSIAu) trading book The total counterparty risk requirement for non market risk in the trading book (also called CPCOM) is the sum of the capital charges arising from Delivery Versus Payment transactions, Free Deliveries, OTC Derivatives, Repos, Reverse Repos and Deferred Settlement Transactions. The figure here should be transferred to Form PIB 6, Item No. 6.32.

            • PRU 2.2.11 Guidance for Form PIB 2 — Appendix 5 — Detail of Non-Market Risk in Trading Book (PSIAu)

              Instructional Guidelines

              All the guidance notes in Form PIB 2, Appendix 4 apply here unless otherwise stated. This Appendix relates to PSIAu assets only

              Item No. Item Guidance
              2.A5.4 Total capital requirement for non-market risk in the (PSIAu) trading book The total CPCOM figure as reported here should be transferred to Form PIB 2, Appendix 8, Item No. 2.A8.1.1.

            • PRU 2.2.12 Guidance for Form PIB 2 — Appendix 6 — Detail of Non-Market Risk in Trading Book (PSIAR)

              Instructional Guidelines

              All the guidance notes in Form PIB 2, Appendix 4 apply here unless otherwise stated. This Appendix relates to PSIAR assets only.

              Item No. Item Guidance
              2.A6.4 Total capital requirement for non-market risk in the (PSIAR) trading book The total CPCOM figure as reported here should be transferred to Form PIB 2, Appendix 8, Item No. 2.A8.1.1.

            • PRU 2.2.13 Guidance for Form PIB 2 — Appendix 7 — Detail of Market Risk in the Trading Book

              Instructional Guidelines

              DFSA acknowledges that even for Authorised Firms with relatively straightforward exposures on the trading books, the underlying calculations for various market risks can be detailed and complex. DFSA requires only the summary numbers to be reported but expects Authorised Firms to maintain detailed audit trails that substantiate the risk requirements and to make this information available for review as and when required.

              In the event of any uncertainty, Authorised Firms are advised to contact their supervisor for clarity. Authorised Firms are asked to review the material set out PIB Appendix 5 with care given the multiplicity of methods that can be used to calculate the capital requirement on interest rate risk, equity risk, FX risk, commodities risk, options risk and securities underwriting risk.

              Where Authorised Firms intend to use internally developed market risk models for the purposes of valuing positions and calculating capital requirements, particular attention is drawn to PIB Section A5.8 and the qualitative criteria.

              Authorised Firms should note that the market risks arising from exposures in respect of self financed, PSIAu and PSIAR assets are required to be entered in this Appendix. Authorised Firms are reminded to take care in transposing totals from this Appendix as they relate to the three different sets of exposures.

              Item No. Item Guidance
              2.A7.1.4
              2.A7.2.4
              2.A7.4.4
              2.A7.5.4
              2.A7.6
              Capital Requirements The total capital requirements for interest rate, equity position risk, Commodities, Options and Securities Underwriting exposures in respect of self financed assets should be transferred to Form PIB 6, Item Nos. 6.33–6.37 respectively. The capital requirements for PSIA funded assets (both unrestricted and restricted), including the Foreign exchange risk requirement should be transferred to Form PIB 2, Appendix 8 for the calculation of the Displaced Commercial Risk Charge.
              2.A7.3 FER capital Requirement The FX risk capital requirement arising from self financed assets should be transferred to Form PIB 6, Item No. 6.24.
              2.A7.10 Total Trading Book Capital Requirement The Total Trading Book Capital Requirement here should be transferred to Form PIB 6, Item No. 6.38 in PIB 6.

            • PRU 2.2.14 Guidance for Form PIB 2 — Appendix 8 — Calculation of the DCR

              Instructional Guidelines

              DCR is defined in PIB Section 3.4. Authorised Firms are referred to that Section to understand why DCR arises and how it is calculated. Authorised Firms are reminded that DCR only applies in respect of PSIA assets for both he restricted and unrestricted categories. This Appendix aggregates totals from the detailed appendices that precede it.

              Item No. Item Guidance
              2.A8.1 PSIACOM Credit PSIACOM Credit comprised CRCOM and CPCOM calculated on PSIA assets.
              2.A8.1.1 CPCOM CPCOM for PSIAu comes from Form PIB 2, Appendix 5, Item No. 2.A5.4 of and for PSIAR from Form PIB 2, Appendix 6, Item No. 2.A6.4.
              2.A8.1.2 CRCOM CRCOM for PSIAu comes from Form PIB 2, Appendix 2, Item No. 2.A2.13 and for PSIAR from Form PIB 2, Appendix 3, Item No. 2.A3.13.
              2.A8.1.3 Total PSIACOM Credit Sum of Item Nos. [2.A8.1.1 + 2.A8.1.2] above.
              2.A8.2 PSIACOM Market The figures for PSIACOM Market are all derived from Form PIB 2, Appendix 7.
              2.A8.3 Calculation of DCR DCR represents (PSIACOM Credit +PSIACOM Market) * 35%. This figure should be transferred to Form PIB 6, Item No. 6.25.

            • PRU 2.2.15 Guidance for Form PIB 2 — Appendix 9 — Detail of changes in Reserves

              Instructional Guidelines

              Item No. Item Guidance
              2.A9.1 Capital invested Report here the total amount of capital invested by unrestricted PSIA account holders (on balance sheet) gross of provisions. Report similar amounts relating to funds provided by restricted PSIA account holders (off balance sheet).
              2.A9.2 Net asset value Report here the net amount after provisions.
              2.A9.3 Percentage for profit equalisation reserve Report the percentage used for allocation to the profit equalisation reserves.
              2.A9.4 Amount of profit equalisation reserve This represents the amount after the net asset value has been multiplied by the percentage of the profit equalisation reserve. Refer to FAS 11 of AAOIFI.
              2.A9.5 Mudarib fee Enter the Mudarib fee which the authorised institution is entitled to receive for undertaking the investment of the funds provided by the PSIA holders. The fee is agreed by the investment account holders and the bank before the implementation of any contract. In case of a loss, the bank is not entitled to any Mudarib fee and the loss is borne by the investment account holders. Refer to FAS 3 of AAOIFI.
              2.A9.6 Net amount after Mudarib fee Enter here the balance after the amount of profit equalisation reserve and the Mudarib fee has been deducted from the net asset value.
              2.A9.7 Percentage of investment risk reserve Enter here the percentage of the investment risk reserve applicable to the net amount after the mudarib fee.
              2.A9.8 Amount of investment risk reserve Enter the amount of the reserve being the product of the balance in Item No. 2.A9.6 multiplied by the percentage in Item No. 2.A9.7 above. Refer to FAS 11 of AAOIFI.
              2.A9.9 Amount attributed to PSIAs This amount is the residual amount allocated to the PSIA account holders after the deduction of the amounts for the profit equalisation reserve, mudarib fee and investment risk reserves.

            • PRU 2.2.16 Guidance for Form PIB 3 — Profit and Loss Statement

              Instructional Guidelines

              Item No. Item Guidance
              3.1 Interest income Include both actually received interest and receivable interest which has accrued but has not yet been received, generated for example by:
              •   Cash and liquid assets
              •   Trading securities
              •   Investment securities
              •   Derivatives in the non-trading book
              •   Loans and advances
              •   Investment / loans to parent entity / loans to associates / joint venture
              •   Other investments
              •   Other interest earning assets
              3.2 Interest expense Include both interest actually paid and interest payable which has accrued but has not yet been paid, linked to, for example:
              •   Deposits;
              •   Other borrowings;
              •   Derivatives in the non-trading book;
              •   Bonds, notes and other borrowings;
              •   Loan capital;
              •   Loan from parent entity;
              •   Loan from associates / joint ventures;

              Other interest bearing liabilities.
              3.4 Income from fees and commissions Include charges made for services provided by the reporting institution, for example the provision of:
              •   Current account facilities;
              •   Corporate advice;
              •   Investment management and trustee services;
              •   Guarantees and indemnities;
              •   Commission on the sale of insurance or travellers cheques;

              Foreign exchange services (if they can be separately identified).
              3.5 Fees and commission expense Include charges for all services rendered to the company by third parties (excluding those which have the character of interest).
              3.8 Net income from trading securities Include all profits or losses (including revaluation profits or losses) other than those arising from the sale of investments in subsidiary or associated companies, trade investments or the amortisation of premiums or discounts on the purchase of fixed maturity investments which are not held for dealing.
              3.9 Net income from investment securities Include net income/(losses) from investments other than the trading securities, such as available for sale and held to maturity investments.
              3.10 Income from Islamic contracts Income derived from any Islamic business undertaken by the Authorised Firm.
              3.11 Other operating income Include under this heading income from any other source (other than extraordinary items), for example:
              •   Revaluations of foreign exchange positions;
              •   Revaluation of any investment in subsidiaries or associates (if equity accounting);
              •   Share of profits from associated companies (if reporting on a consolidated basis);
              •   Profit or loss on the sale of non-trading assets — e.g. premises, equipment, subsidiary and associated companies and trade investments;
              •   Revaluation surpluses/deficits - following normal accounting practice.
              •   Any other source (other than extraordinary items which should be included in PIB 3 Item No. 3.18
              3.12.1 Provisions General Total provisions to cover non-specific bad debt provisions.
              3.12.2 Provisions Specific Total of provisions made against specific exposures.
              3.12.3 Provisions Islamic Those provisions arising from any Islamic business undertaken
              3.12.4 Provisions Other To include, for example, provisions made for taxation or dividends.
              3.13 Staff expenses Include, for example:
              •   Salary costs;
              •   Employer's contribution to any pension scheme;
              •   Costs of staff benefits paid on a per capita basis such as private medical insurance.
              3.14 Depreciation & Amortisation Charges relating, for example, to depreciation / amortisation of property, plant and equipment and other amounts written off in respect of tangible and intangible fixed assets.
              3.15 Other operating expenses Examples of expenses can be as follows:
              •   Occupancy expenses — for example, rates, rent, insurance of building, lighting, heating, maintenance costs and subsidised restaurants;
              •   Equipment;
              •   Other overhead expenses;
              •   All other expenditure not falling into one of the other specific categories.
              3.16 Operating profit from ordinary activities Sum of PIB 3 Item Nos. 3.1 to 3.15. (excluding sub totals at items nos 3.3 and 3.6).
              3.17 Net income from subsidiaries and associated companies Profit / losses received from subsidiaries, joints ventures and other associated undertakings.
              3.18 Profit (loss) from extraordinary Items For example:
              Profit or losses on sale or termination of an operation;
              Profits or losses on disposal of fixed assts.
              3.19 Profit (loss) before tax Sum PIB 3 Item Nos. 3.16 + 3.17 + 3.18.
              3.20 Tax on (profit)/loss Any amount that has been or is expected to be paid in taxation.
              3.21 Profit / (loss) after tax Sum of PIB 3 Item Nos. 3.19 + 3.20.
              3.22 Minority interests For example, when a group has one or more subsidiaries which are only partially owned by the group.
              3.23 Net profit / (loss) The amount of profit / loss that could be distributed to shareholders (or partners) or retained for future use within the company. Sum of PIB 3 Item Nos. 3.21 + 3.22.
              3.24 Dividends and other distributions, declared or paid The amount to be distributed in the current year to shareholders out of the profits of a company.
              3.25 Partners' Drawings, declared or paid The amount to be distributed in the current year to partners out of the profits of a partnership.
              3.26 Other adjustments Any other adjustments that affect the retained profits.
              3.27 Retained profits for the reporting period Profits that have not been paid out as dividends to shareholders or withdrawn by partners but retained for further investment by the company. Sum of PIB 3 Item Nos. 3.23 - 3.24 - 3.25 - 3.26.

            • PRU 2.2.17 Guidance for Form PIB 4 — Profit and Loss — Islamic Financial Institutions

              Instructional Guidelines

              Item No. Item Guidance
              4.1.1 Income from jointly financed accounts Authorised Firms should include in respect of this item income earned on funds from jointly financed investment accounts (i.e. unrestricted PSIAs and self-financed). The income should be gross before allocating to the unrestricted PSIAs and the bank's mudarib fee.
              4.1.2 Allocated to unrestricted account holders Authorised Firms should include in respect of this item the amount allocated from PIB 4 Item No. 4.1.1 above to the unrestricted PSIAs as their share of the income. It should be mostly be a negative number.
              4.1.3 Authorised Firm's Mudarib fee Authorised Firms should include in respect of this item the amount of the Mudarib fee that they are entitled to receive for the management of the unrestricted PSIAs.
              4.1.4 Authorised Firm's other fees Include any amounts owing to the Authorised Firm as fees for managing PSIAR accounts.
              4.1.5 Net income from Jointly Financed Accounts and Mudarib Fees Sum of PIB 4 Item Nos. 4.1.1 + 4.1.2 + 4.1.3 + 4.1.4.
              4.2.1 Authorised Firm's income from its own non-financing activities Authorised Firms should include in respect of this item the income received from non-financing activities (e.g. Murabaha sales) that results from the employment of the Authorised Firm's own funds and current accounts. The income should have been generated from funds that have been employed separately from the PSIA funds.
              4.2.2 Authorised Firm's income from its own financing and investment activities Authorised Firms should include in respect of this item the income received from financing and investment activities that results from the employment of the Authorised Firm's own funds and current accounts. The Bank is solely entitled to profits/ (losses) from these activities.
              4.2.3 Net fees and commission income Authorised Firms should include in respect of this item the income received for services provided such as trade related letters of credit, Corporate advice, Investment management and trustee services, Kefala (guarantees) and indemnities.
              4.2.4 Other operating income Include income from any other source not included in any of the above.
              4.2.5 Total income from Authorised Firm's own funds Sum of PIB 4 Item Nos 4.2.1 + 4.2.2 + 4.2.3 + 4.2.4.
              4.3 Staff costs Include costs such as:
              •   Wages and salaries;
              •   Social security contributions;
              •   Contribution to any pension schemes (employer's share);
              •   Costs of staff benefits paid.
              4.4 Premises and equipment costs Should include rent, property tax, lighting, heating, maintenance costs etc.
              4.5 Depreciation and amortisation Charges relating, for example, to depreciation / amortisation of property, plant and equipment and other amounts written off in respect of tangible and intangible fixed assets.
              4.6 Provision for losses on Islamic contracts Provision for losses on Islamic Contracts: refer to FAS 11 of AAOIFI which requires the inclusion of bad and doubtful Islamic Financing and non financing contracts and investments.
              4.7 Other provisions Include here all other provisions other than for Islamic contracts.
              4.8 Other operating expenses Include all other expenses not included in any of the above.
              4.9 Operating profit from ordinary activities Sum of PIB 4 Item Nos. 4.1.5 + 4.2.5 - 4.3 - 4.4 - 4.5 - 4.6 - 4.7 - 4.8.
              4.10 Net income from subsidiaries and associated companies Report share of profits and losses of from subsidiaries and associated companies.
              4.11 Profit (loss) from extraordinary items For example:
              Profit or losses on sale or termination of an operation;
              Profits or losses on disposal of fixed assts.
              4.12 Profit (loss) before Zakah and tax Sum of PIB 4 Item Nos. 4.9 + 4.10 + 4.11.
              4.13 Zakah Include Zakah amount calculated with reference to FAS 9 of AAOIFI.
              4.14 Tax on profit / loss Any amount that has been or is expected to be paid in taxation.
              4.15 Profit (loss) after Zakah and tax Sum of PIB 4Item Nos. 4.12 - 4.13 - 4.14.
              4.16 Minority interests For example, when a group has one or more subsidiaries which are only partially owned by the group.
              4.17 Net profit / (loss) The amount of profit (loss) that could be distributed to shareholders or retained for future use within the company. Sum of PIB 4 Item Nos. 4.15 - 4.16.
              4.18 Dividends, and other distributions, declared or paid The amount to be distributed in the current year to shareholders out of the profits of a company.
              4.19 Other adjustments Any other adjustments that affect the retained profits.
              4.20 Retained profits for the reporting period Sum of PIB 4 Item Nos. 4.17 - 4.18 - 4.19.

            • PRU 2.2.18 Guidance for Form PIB 5 — Expenditure Based Capital Minimum

              Instructional Guidelines

              An Authorised Firm in Categories 2, 3 or 4 must complete this form in accordance with PIB Section 2.5.

              Item No. Item Guidance
              5.1 Total expenses This figure should correspond to Form PIB 3, Sum of Item Nos. 3.6 + 3.2 + 3.5 + 3.12 + 3.13 + 3.14 + 3.15
              5.2 Staff bonuses All staff bonuses paid during the year except to the extent that they are non-discretionary.
              5.3 Employees' and directors shares in profits All employees' and directors shares in profits except to the extent that they are non-discretionary.
              5.4 Other appropriations of profits All such appropriations except to the extent that they are automatic. As per PIB Rule 2.5.2(2), a management charge should not be treated as an appropriation of profits.
              5.5 Shared commissions payable Those commissions that would no longer be payable if business were to cease.
              5.6 Interest charges in respect of borrowings made to finance the acquisition of realisable investments Interest that is paid in respect of borrowings made to finance the acquisition of the Authorised Firm's realisable investments
              5.7 Interest paid to clients on client money balances Include here interest paid on Client Money balances.
              5.8 Interest paid to counterparties Interest that is payable to counterparties in the Trading Book.
              5.9 Fees, brokerage and other charges An Authorised Firm may exclude commissions shared with third parties other than employees, directors, half commission men or appointed representatives. Fees, brokerage and other charges paid for the purposes of executing, registering or clearing transactions may also be excluded.
              5.10 Foreign exchange losses Losses arising from the translation of foreign currency balances may be excluded.
              5.11 Contributions to charities The contribution that would no longer be paid if business were to cease.
              5.12 Total expenditure PIB 5 Item No. 5.1 less the Sum of PIB 5 Item Nos. 5.2 to 5.11.
              5.13 Fraction applied As set out in PIB Rule 2.5.1 (a), (b) or (c).
              5.14 Expenditure based capital minimum Use the expenditure based capital minimum amount calculated as per the provisions of Rules PIB 2.5.1, PIB 2.5.2 and PIB 2.5.3.

            • PRU 2.2.19 Guidance for Form PIB 6 — Capital Adequacy Calculation

              Instructional Guidelines

              The structure of this reporting form, which applies to all Categories of Authorised Firm, is designed first to calculate the total eligible capital resources after the appropriate amounts have been charged to cover trading and non trading book risks. It takes into account limitations on the use of different types of capital, including Tiers 1 and 2 capital components. Secondly, it provides a snapshot of the institution's capital adequacy at the reporting date by comparing the adjusted capital resources calculated as described above to the total capital requirement.

              Most of this form involves the inputting of numbers that have been provided in other returns and particular care should be taken to ensure that numbers have been transposed correctly.

              Item No. Item Guidance
              6.0 Capital Adequacy See PIB Section 2.6 and Table 2.6.1 for a summary of the components of capital base. PIB Section 2.7 describes each capital component in greater detail. Attention is drawn to Partnership Capital which constitutes the capital accounts of partners when the business is created. It must share the same characteristics as permanent share capital, particularly the fact that it must rank for repayment upon winding up or insolvency after all debts and liabilities have been paid. The deduction for partners drawings is in respect of any excess in drawings over current period profits. Attention is also drawn in respect of PIB Rule 2.7.3 in respect of the limitation on the use of general provisions in Tier 2 capital.
              6.1–6.22 Tier 1 and Tier 2 capital Authorised Firms should note that there are related guidance notes on the capital base for Forms PIB 1 and PIB 2. The guidance there would apply in their entirety to this section of the return.
              6.23 Deduction for excess of reserves This applies only in respect of Category 5 Authorised Firms with regards the Investment Risk and Profit Equalisation Reserves. See PIB Section 2.9.
              6.25 NTB Capital Requirement See PIB Rule 2.8.3 for a definition of the components of non trading book capital. For Category 5 Authorised Firms, the CRCOM and FER are on self financed assets only. These numbers will be derived from Forms PIB1 and PIB 2 for Category 1-4 Authorised Firms and Category 5 Authorised Firms, respectively. The DCR charges are derived from Form PIB 1 Appendix 4 and Form PIB 2 Appendix 8 for Category 1-4 Authorised Firms and Category 5 Authorised Firms, respectively.
              6.30 Capital allocated to the NTB The limitations on the use of capital allocated to the NTB are set out in PIB Section 2.8.
              6.34 TB Capital Requirement This is defined in PIB Rule 2.8.3. For Category 1-4 Authorised Firms, the numbers here are derived from Form PIB 1, Appendices 2 and 3. Also see guidance notes relating to those appendices. For Category 5 Authorised Firms, the capital requirements are in respect of self financed assets only (PSIA assets are subject to a DCR charge). These numbers are derived from Form PIB 2, Appendices 4 and 7.
              6.42 Capital allocated to the TB Note the limitation on the use of Tier 2 capital as referenced to PIB Rule 2.8.2 (b) (iii). Category 1 and 5 Authorised Firms must exclude from Tier 2 trading book capital any excess over 200% of Tier 1 trading book capital. For Category 2-4 Authorised Firms, the appropriate percentage is 250%.
              6.51 Deductions from total capital resources The deductions in respect of connected lending, material holdings and qualifying holdings are defined in Rules PIB 2.7.4, PIB 2.7.5 and PIB 2.7.6, respectively.
              6.59 Capital Requirement The non additive thresholds of capital are set out in PIB Rule 2.3.1. Details of the base capital requirement are further analysed in PIB Section 2.4. The Expenditure Based Capital Requirement definition is set out in PIB Section 2.5 and applies to Categories 2, 3 and 4 Authorised Firms only.
              6.61 Resources less requirement Note that the total of resources over requirement is expected to be positive. In the event of the requirement exceeding resources, Authorised Firms should make immediate contact with DFSA and not wait till the form has been submitted.
              6.62 Risk Asset Ratio Obtained by dividing total capital resources by the risk weighted assets (whether on the trading or non trading books). The risk weighted assets have been reported by Authorised Firms in the preceding Forms PIB 1 and 2. The capital resources are summarised in Form PIB 6.

            • PRU 2.2.20 Guidance for Form PIB 7 — Large Exposures

              Instructional Guidelines

              An Authorised Firm is required to identify and manage its exposures in accordance with PIB Rule 4.5.6 and PIB section A4.8.

              As per the Glossary, an Exposure, whether in an Authorised Firm's Non-Trading Book or Trading Book, or both, to a Counterparty or Group of Closely related Counterparties connected to the Authorised Firm which in the aggregate equals or exceeds 10% of the Authorised Firm's Capital Resources.

              The 20 largest exposures should be listed and, if requested, any other exposure that exceeds 10% of the Authorised Firm's Capital Resources. Only exposures that are non-exempt are required to be reported in the first two tables.

              Item No. Column Item Guidance
              7.1   Capital Resources The capital resources used as the basis for monitoring and controlling large exposures should be calculated in the same way as those used for capital adequacy monitoring, i.e. the sum of allowable Tier 1 and Tier 2 capital less any deductions (as set out in PIB Table 2.6.2) — as per Form PIB6, Item No. 6.58.
              The various percentage amounts should be specified in the relevant sections.
              7.2   Twenty Largest Exposures Include in this table the twenty largest exposures to all types of Counterparty except those that are considered to be exempt.
              Exposures to individual, or groups of closely related, Counterparties should be reported in descending order by size. Exposures to individual Counterparties which constitute a group of closely related Counterparties should be reported as one aggregate exposure.
                A Counterparty The identity of a Counterparty, as defined in the Glossary, in this context will generally be one of the categories as set out in PIB Rule A4.8.6.
                B Connected, Unconnected — Bank, Unconnected — Other, Government The Authorised Firm should clarify here into what category an exposure falls. These are set out in detail in Rules PIB A4.8.7 to PIB A4.8.11 but for the purposes of this form, an Authorised Firm should state whether an Exposure is to:
              (i) a Connected Counterparty;
              (ii) an Unconnected Counterparty or group of Closely Related Counterparties that are predominantly comprised of non-financial businesses;
              (iii) an Unconnected Counterparty or group of Closely Related Counterparties that are predominantly comprised of financial businesses;
              (iv) Central governments and central banks.
                C Amount of non-exempt exposure For exposures arising in the Non-Trading Book the amount at risk should, with certain exceptions detailed below, be reported as the book value of the Authorised Firm's actual or potential claims, contingent liabilities or assets.
              Exposures should be calculated in accordance with IFRS or AAOFI standards.
              For exposures arising in the Trading Book, all positions should be marked-to-market daily. Where a market determined price is not readily available, the Authorised Firm may generate its own mark-to-market valuation. Positions should be valued in accordance with the procedures outlined in the Authorised Firm's trading book policy statement.
              This is set out in more detail in Rules PIB A4.8.13 to PIB A4.8.31.
                D Specific bad debt provision Include here the amount of specific bad debt provision that may have been made against a particular exposure.
                E Reduction by netting, collateral etc. As set out in PIB Rule 4.5.6 (d) (ii), the value of an exposure can be reduced through the following:
              •   Collateral — discussed in more detail in PIB Section 4.6 and PIB Rule A4.8.32
              •   Netting — discussed in more detail in Sections PIB 4.7 and PIB A4.9
              •   Securitisation — discussed in more detail in Sections PIB 4.8 and PIB A4.10
              •   Credit derivatives — discussed in more detail in Sections PIB 4.9 and PIB A4.11.
                F Exposure at reporting date after eligible set-offs Column C less the amounts in Columns D and E.
                G Amount of this exposure financed by own assets or unrestricted PSIAs For Exposures arising out of Islamic business, this column should be used to quantify the amount of the Exposure that is financed by the Authorised Firm's own assets or by unrestricted PSIA assets.
                H Amount of this exposure financed by restricted PSIAs. For Exposures arising out of Islamic business, this column should be used to quantify the amount of the Exposure that is financed by restricted PSIA assets.
              7.3   Detail of exposures to connected counterparties This section comprises the disaggregated detail of all connected lending and exposures should be split into different counterparties within the connected group.
                A Financial or Non-financial company An Authorised Firm should indicate here if the exposure is to a bank or non-bank within its own group.
                B-H As for Item No. 7.2 As detailed above for the table in for Item No. 7.2.
              7.4   Ten Largest Exempt Exposures An Authorised Firm is required to identify its exempt and partially exempt exposures as per Rules PIB 4.5.6 (e) and PIB A4.8.1 to PIB A4.8.4.
                A Reason for exemption The Authorised Firm should specify here under what section of PIB A4.8.1PIB A4.8.4 the Exposure is captured.
                B-H As for Item No.7. 2 As detailed above for the table in for Item No. 7.2.

              Additional detail for Form PIB 7 — Appendix 1 — Largest 25 Exposures arising from Islamic contracts

              Item No. Contract type Guidance
              7A1.1 Musharaka Report all Musharaka contracts currently outstanding that exceed 10% of the Authorised Firm's Capital Resources. Details regarding the following should be included:
              •   Whether the capital has been self financed or provided by PSIA accounts
              •   The amount of capital redeemed during the period such as in the case of a diminishing Musharaka.
              •   Any income or loss declared, any provisions being made to the value of the Musharaka and the net value of the investment.

              FAS 4 of AAOIFI refers.
              7A1.2 Mudaraba Report all Mudaraba financing contracts that would qualify as a Large Exposure. Identify the basis on which the Authorised Firm has provided the financing i.e. whether on a self financed or on a PSIA funds basis. FAS 3 refers.
              7A1.3 Istisna'a/Parallel Istisna'a Report all Istisna'a contracts that would qualify as a Large Exposure. Identify the value of the Parallel Istisna'a and indicate what proportion of the value has been financed by Authorised Firm's own capital and the funds of PSIA account holders. FAS 10 refers.
              7A1.4 Salam/ Parallel Salam Report all Salam contracts and Parallel Salam amounts that would qualify as a Large Exposure. The data is to be split into values financed by Authorised Firm's own capital and the restricted and unrestricted PSIA account holders. FAS 7 refers.
              7A1.5 Ijarah/ Ijarah Muntahia Bittamleek Report all Ijarah assets on the valuation basis set out in FAS 8. Report also, all assets transferred to lessee for consideration or gift including the value of impairment before transfer of legal asset. State total depreciation/ amortisation charge and the net book value. This information is required to be provided for self financed and both forms of PSIA accounts. The data is to be split by the industrial sectors identified in the reporting statement. FAS 8 refers.
              7.A1.6 Murabaha Report here all Murabaha exposures that would qualify as a Large Exposure. Divide exposures into self financed, PSIAR and PSIA unfunded exposures. FAS 2 refers.
              PIB 8 — LIQUIDITY MISMATCH

              As set out in PIB Rule 6.3.3, an Authorised Firm in Category 1 or 5 must use the Maturity Mismatch approach to measure its liquidity. This applies equally to Authorised Firms that have a branch presence in the DIFC as to those that are incorporated.

              In accordance with PIB Rule 6.3.4, an Authorised Firm needs to complete separate returns for a business that is funded by: (i) its own assets; (ii) restricted PSIA assets; and (iii) unrestricted PSIA assets.

              Liquidity reporting in individual currencies
              The return should be completed on the basis of all currencies combined. Currencies should be translated into $ at the closing spot mid price on the reporting date and entered in the relevant time band. However, the DFSA may require institutions to provide management information on positions in individual currencies in the event of difficulties either in the individual institution or with the currency in question.

              Cashflow versus maturity analysis approach
              The policy aim is to ensure that institutions hold sufficient liquid assets to meet their obligations as they fall due and the DFSA has set mismatch guidelines to help secure the policy objective. The Form PIB 8 monitors Authorised Firms' compliance with the limits in two ways: firstly, by including a maturity analysis of known and/or potential cashflows out to six months and secondly, by a maturity analysis of assets and liabilities from 6 months to 5 years.

              Institutions should report both inflows and outflows on the same basis. Therefore, if an institution reports inflows on the cashflow basis out to three months, it should also report outflows on the cashflow basis out to three months.

              Items reported on a cashflow basis should include both interest and principal amounts, together with any other income relating to them. Items reported on a maturity basis should be reported at their value on the institution's books. However, any cashflows arising from these items (e.g. interest payments) within the cashflow reporting period should be included in the relevant cashflow periods. Thus cashflows (e.g. interest payments on a loan) arising from items (however reported) should be entered in the relevant cashflow timebands (i.e. those which the institution reports) when they fall due.

              Provisions
              Items should be reported net of specific provisions. General provisions should not be recorded on this return.

              Residual Maturity
              As set out in PIB Rule A6.2.1, outflows (such as deposits and other liabilities) are to be included according to their earliest possible repayment date. In this context, the earliest repayment date means the first rollover date or the shortest period of notice required to withdraw the funds or to exercise a break clause, where applicable. Inflows (such as loans) are to be entered as occurring on the latest possible repayment date. Purely technical break facilities should be disregarded for fixed term loans. Where the Authorised Firm has loans outstanding at the reporting date under revolving credit lines and has not received notification that they will be redrawn on maturity, the intermediate date should be taken as the maturity date.

              Time bands
              The time band 'Overdue'should be used to record cashflows where assets or other items giving rise to cashflows are non-performing, poorly performing or there is reasonable doubt about the certainty of receipt of inflows of funds pertaining to them. Where an asset or cashflow previously reported as overdue is contractually rescheduled according to a written agreement, institutions should cease to report these items as 'overdue' and report them according to the new agreed dates for repayment.

              The timeband 'Demand (incl next day)' comprises cashflows or asset items due, available or maturing on the next business day after the reporting date. Cashflows arising or assets/liabilities maturing on a non-business day should be reported as taking place on the following business day. Funds callable at one day's notice should be entered as two-day maturity unless notice has been received or given on the reporting date.

              Netting of debts and claims
              All claims and liabilities should be reported gross. Authorised Firms should not net (or offset) claims on counterparties or groups of counterparties against debts owed to those counterparties or groups of counterparties, even where a legal right of set off exists. Where the maturity of the claims and debts falls within the same timeband, the claims and debts will automatically offset each other on the return in the calculation of the mismatch.

              Marketable securities
              An asset is considered to be marketable if it meets the requirements as set out in PIB Section A6.3(2) — essentially, these are assets that could be readily converted into cash where necessary. These assets, outlined in Column A, are reported in rows 8.1.1–8.1.10, Highly liquid / marketable assets. Authorised Firms should enter the full value of the marketable asset concerned in Column B, apply the discount rate as in Column C, and thereby calculate the discounted mark to market value of the asset in Column D. Discounts are applied to reflect that an institution may realise less than the market price quoted for an asset where the institution is seeking to realise assets quickly because of liquidity problems pertaining either to itself, or to general market conditions, or both.

              The Authorised Firm should then allocate the discounted value of the assets to either of Columns G or H determined by the length of the settlement period for the instrument in question. This reflects the length of time it would take for an Authorised Firm to receive the proceeds of any sale. Where the settlement period for items is more than eight days, or where there are other factors which mean that funds would not be received within eight days, were the assets are sold or repo'd today, then the funds should be recorded as receivable Column H 'Over 8 days to 1 month'. Where settlement or other delays mean that funds would not be received within one month, then the items should be recorded in the maturity analysis section of the form.

              Marketable assets maturing at exactly one month should be reported in the cashflow section of the return. Authorised Firms may however include the full value of the asset in the one month timeband and not discount at all during the life of the asset.

              Where assets have a residual maturity of less than one month, the DFSA recognises that it is not relevant to apply automatically a discount to such assets. In general, these assets should be entered as cashflows in the relevant timebands in rows 8.1.12–8.1.25 and no discount will be applied.

              Assets which do not meet the criteria for marketable assets, or which cannot be fitted into the table in PIB Rule A6.3.1(4), are non-marketable assets for the purposes of this return and should be reported in the form according to their residual maturity. This covers for example:
              a. Non-investment grade debt instruments (as rated by a recognised credit agency) issued by a Zone 2 issuer;
              b Non-investment grade debt instruments (as rated by a recognised credit agency) issued by a non-government Zone 1 issuer;
              c. Commercial paper and certificates of deposit that do not meet the definition of marketable assets.

              Authorised Firms should ensure that there is no double counting of cashflows (of principal or interest) arising from holdings of marketable assets on the form.
              Item No. Item Guidance
              8.1 INFLOWS  
                Highly liquid / marketable assets As described in detail above.
              8.1.1 Cash Holdings of notes and coins.
              8.1.2

              8.1.3

              8.1.4
              Cen gov't (Z1) sec — 1 yr or less

              Cen gov't (Z1) sec — 1–5 yrs

              Cen gov't (Z1) sec — over 5 yrs
              Central government (including central government guaranteed) paper and paper eligible for discount at the Central Bank issued a Zone 1 Central Government / another Zone 1 issuer. Both fixed and variable rate securities should be reported. Only record those securities currently in the reporting institution's ownership.
              8.1.5

              8.1.6

              8.1.7
              Non gov't sec — 6 mths or less

              Non gov't sec — 6 mths–5 yrs

              Non gov't sec — over 5 yrs
              Debt instruments that are of investment grade. Only those securities in the reporting institution's ownership, which the institution may freely dispose of at any time with no restrictions, should be recorded. Those assets pledged to another institution or otherwise encumbered should not be included.
              8.1.8 Other cen gov't debt (active) Central government (including central government guaranteed) paper and paper eligible for discount at the Central Bank issued by a Zone 2 Central Government/ another Zone 2 issuer. Include only that debt issued by, or fully guaranteed by, Zone 2 central governments and central banks that is actively traded. Only the debt currently in the reporting institution's ownership should be recorded.
              8.1.9 Highly liquid equities Equities that are eligible for a specific risk weight of 4% or less under the DFSA's Rules regarding the capital requirement for Market Risks and which are currently in the reporting institution's possession.
              8.1.10 Total Sum of Item Nos. 8.1.1–8.1.9, for Columns B, D, G, H and K. With 8.1.10 K being the overall total amount of marketable assets.
              8.1.11 Non-marketable securities Securities which the Authorised Firm holds or will receive, but which it cannot classify as marketable. These should be reported according to the redemption value of the asset or alternatively, where the redemption value is unavailable or not appropriate (e.g. in the case of equities), the book value. Marketable assets maturing within one month reported at their full marked-to-market value, i.e. undiscounted, should also be reported here.
              8.1.12 Inter-bank Inflows arising from placements with other financial institutions. Include the inflows from those entities that would attract a 20% counterparty weighting. Include also that element of committed facilities provided to the Authorised Firm where notification of draw down date has been given. Exclude inflows from any bank entities within the group.
              8.1.13 Intergroup / related Inflows from counterparties connected to the Authorised Firm. Entries should be made in this item rather than any other item in the Wholesale section if any intragroup/connected counterparties are involved.
              8.1.14 Corporate Inflows from non-bank, non-connected corporate counterparties. Initial margins held at clearing houses should be entered here according to their residual maturity. Repayments from leases should also be recorded in this line.
              8.1.15 Govt / public sector — Zone 1 Inflows from central governments, public sector entities, local authorities and central banks in Zone 1 countries.
              8.1.16 Govt / public sector — Zone 2 Inflows from central governments, public sector entities, local authorities and central banks in Zone 2 countries.
              8.1.17 Repos / reverse repos Include any transactions relating to repos and reverse repos. Authorised Firms should also enter any transactions relating to stock borrowing and lending.
              8.1.18 Forward foreign exchange Cashflows relating to forward purchases of foreign currency, where an exchange of principal is effected at the start or maturity of the swap. The amount received should be entered in the appropriate maturity band.
              8.1.19 Forward sales and purchases The cash leg of any forward sales should be treated as an inflow in the timeband corresponding to the date of the forward sale. For forward purchases, where the asset purchased is a marketable asset, the Authorised Firm should report the USD equivalent discounted value of the security purchased at the maturity of the contract. Where the asset purchased is non-marketable, the institution should enter the USD equivalent discounted value of the security at the maturity of the asset.
              8.1.20 Swaps & FRAs For interest rate and currency swaps, enter the receipts of fixed and floating legs in the cashflow section. For FRAs, enter the marked-to-market receipt in the relevant time period. The amount of receipts should be derived from the contract's present value at yields prevailing at the reporting date.
              8.1.21 Commodities Inflows from the sale of commodities held by the Authorised Firm.
              8.1.22 Trade related letters of credit Inflows arising from trade related letters of credit.
              8.1.23 Fees (incl Mudarib) Report here fees, commissions or other income receivable by the Authorised Firm relating to their wholesale business, according to their known date of receipt. Where the date of receipt is unknown, do not report these flows.
              8.1.24 Other funding sources Include here any other funding sources not included elsewhere, according to their cashflows.
              8.1.25 Total wholesale Inflows Sum of Item Nos. 8.1.11–8.1.24, Columns E to J with total in Column K and Columns L to N with total in Column O.
              8.1.26 Total inflows on a cashflow basis

              Total on a maturity basis
              Sum of Item No. 8.1.10, Column K + Item Nos. 8.1.11–8.1.24, Columns E to J, with the total in Column K.

              Sum of Item Nos. 8.1.11–8.1.24, Columns L to N. with the total in Column O.
              8.2 OUTFLOWS  
              8.2.1 Non-marketable securities Include here at residual maturity outflows pertaining to maturing securities or debt instruments, which cannot be classified as marketable. Marketable assets maturing within one month at their full marked-to-market value, i.e. undiscounted should also be reported here.
              8.2.2 Inter-bank Funds Outflows arising from placements with or from, or repayments of loans to or from, banks. Also include the entire outflows to those entities that would attract a 20% counterparty weighting. Exclude from this item loans to, or placements with, or deposits / placements from, bank entities within the group.
              8.2.3 Intergroup / related Outflows of funds to counterparties connected to the reporting institution. Entries should be made in this item rather than any other item in the Wholesale section if any intragroup/connected counterparties are involved.
              8.2.4 Corporate Outflows to non-bank, non-connected, corporate counterparties.
              8.2.5 Govt / public sector — Zone 1 Report funds lent to central governments, public sector entities, local authorities and central banks in Zone 1 countries. Where an Authorised Firm is required to place funds on deposit with central banks and monetary authorities, these should be entered as an outflow in the relevant time band.
              8.2.6 Govt / public sector — Zone 2 Report funds lent to central governments, public sector entities, local authorities and central banks in Zone 2 countries. Where an Authorised Firm is required to place funds on deposit with central banks and monetary authorities, these should be entered as an outflow in the relevant time band.
              8.2.7 Repos / reverse repos Outflows related to repos or reverse repos. Also include any outflows relating to stock borrowing and lending.
              8.2.8 Forward foreign exchange Enter any cashflows relating to forward sales of foreign currency, where an exchange of principal is effected at the start or maturity of the swap. The amount paid should be entered in the appropriate maturity band.
              8.2.9 Forward sales and purchases For forward sales, the sterling (or euro) equivalent discounted value of the security sold should be recorded as an outflow. The cash leg of any forward purchases should be treated as an outflow in the timeband corresponding to the date of the forward purchase.
              8.2.10 Swaps & FRAS For interest rate and currency swaps, enter payments of fixed and floating legs in the cashflow section.
              For FRAs, enter the marked-to-market payment in the relevant time period. The amount paid should be derived from the contract's present value at yields prevailing at the reporting date.
              8.2.11 Commodities Outflows from the purchase of commodities held by the Authorised Firm.
              8.2.12 Trade related letters of credit Outflows arising from trade related letters of credit.
              8.2.13 Dividends, tax & other costs Outflows arising from dividends, tax etc.
              8.2.14 Ijarah asset purchases Outflows for commitments made for the purchase of these assets.
              8.2.15 Other outflows Any outflows relating to payments of dividends and tax, or any other outflows that have not previously been reported elsewhere. Also report any outflows relating to settlement accounts, using the trade date plus the settlement period to determine the appropriate timeband.
              8.2.16 Other off-balance sheet Any outflows relating to off balance sheet items that have not been reported elsewhere.
              8.2.17 Total Wholesale Outflows Sum Item Nos. 8.2.1–8.2.16, Columns E to J with total in Column K and Columns L to N with total in Column O..
              8.2.18 Total Outflows on a Cashflow basis

              Total on a maturity basis
              Sum of Item Nos. 8.2.1–8.2.16, Columns E to J, with the total in Column K.

              Sum of Item Nos. 8.2.1–8.2.16, Columns L to N, with the total in Column O.
              8.3 CALCULATION OF LIQUIDITY MISMATCHES Authorised Firms should monitor compliance with their liquidity mismatch guidelines each business day and should report in this section the mismatch on the reporting date, using the data from the previous parts of the return.
              8.3.1 Type of business Denotes business financed by different sorts of assets.
              8.3.2 Timeband The timebands for which limits are set: Sight to 8 days and Sight to one month.
              8.3.3 Total discounted marketable assets Figure from row Item No. 8.1.10, Column G for S-8 days and Column G plus H for S-1 month.
              8.3.4 Total standard inflows Figure from row 8.1.25, column F plus G for S-8 days and Column F plus G plus H for S-1 month.
              8.3.5 Total standard outflows Figure from row 8.2.17, column F plus G for S-8 days and Column F plus G plus H for S-1 month.
              8.3.6 Total relevant deposits This figure provides the denominator for the mismatch calculation (see Item No. 8.3.7 below):
              •   For conventional Authorised Firms, the figure is obtained from Form PIB 1, Item No. 1.10.
              •   For Islamic Authorised Firms, see next section of the table.
              •   For branches, figure from form PIB 9, item no 9.26.
              8.3.7 Mismatch as a % of total deposits As set out in Rules PIB 6.3.4 and PIB 6.3.5, the mismatch positions should not exceed -15% or -25% for the sight — 8 days and sight — 1 month timebands respectively.

              Additional Guidance for Islamic Contracts:

              8.1 Inflows   All inflows should be taken as occurring at the last possible contractual repayment date. The treatment of inflows for Islamic contracts are as follows and it is for the authorised institution to determine in which of the categories the inflows should be recorded. In the event of any doubt, the institution should contact its regular supervisory contact at DFSA.
                  Mudaraba Inflows of capital should be reported at the latest redemption date or as assets maturing at the latest possible redemption date. Profits on Mudaraba should only be reported to the extent that it is being reported at the reporting date.
                  Musharaka Capital inflows on a normal Musharaka contract should be entered as occurring on the latest possible termination date and in the case of a diminishing Musharaka at the latest redemption date. Inflows on profits should only be entered if it is being distributed at reporting date.
                  Murabaha Receivables Inflows reported should include instalment payments and related accrued profit at the latest possible repayment date (or assets maturing at such a date).
                  Ijarah/ Ijarah Muntahia Bittamleek Report all inflows occurring from Ijarah lease rentals at the last possible payment date. Where the lessee has option to purchase the asset either during the duration of the lease or at the end of the contract, the amount to be received should be reported as an inflow at the latest possible exercise date.
                  Salam and Parallel Salam Enter the amount of inflows as occurring at the latest possible delivery date. If payments are received in the form of instalments (Parallel Salam), only enter the amount of instalments occurring at their latest possible repayment date (or as an asset maturing at the latest repayment date). Enter commodity flows separately in the line market commodities.
                  Istisna'a and Parallel Istisna'a Inflows should be assumed to occur at the latest possible completion date. If repayment is via instalments, inflows should be on the latest instalment date.
              8.2 Outflows   All outflows should be taken as occurring at the earliest possible contractual repayment date. In the case of a Liability, assume the outflows to occur at the earliest possible maturity date. For Islamic contracts, outflows should only be recognised when there is already in existence a defined agreement between the parties for a particular Islamic Contracts. As previously stated, Authorised Firms will be expected to refer to the appropriate AAOIFI FAS pronouncement in respect of Islamic contracts. These include Mudaraba, Musharaka, Murabaha, Salam and Parallel Salam, Istisna'a and Parallel Istisna'a and Ijara or Ijarah Munatahia Bitamleek.
                  Salam and Parallel Salam For Salam transactions enter amount of outflows as additional advances committed at the earliest possible drawdown date.
                  Istisna'a Outflows on Istisna'a contracts are to be entered as occurring at the earliest possible drawdown date. If drawdown occurs based on percentage completion, the outflows should be assumed to occur at the earliest completion date or as a liability maturing at the earliest completion date.
                  Ijarah Commitments made for the purchases of assets for Ijarah purposes should be included as outflows at the earliest date committed for the purchase.
              8.3.6 Total relevant deposits   For self-financed business, Authorised Firms should use the figure from Form PIB 2, Item No. 2.20.
              For business financed through PSIAs, the appropriate figure should be derived from the amounts due (akin to deposits) to PSIA account holders.

            • PRU 2.2.21 Guidance for Form PIB 9 — Branch Return

              Instructional Guidelines

              This return should only be completed by Authorised Firms that operate in or from the DIFC through a branch, rather than incorporated, office.

              Appendix 1 — Large Exposures is not applicable to Category 4 Authorised Firms.

              STATEMENT OF PROFIT AND LOSS

              Item No. Item Guidance
              9.1 Interest income Include both actually received interest and receivable interest which has accrued but has not yet been received, generated for example by:
              •   Cash and liquid assets
              •   Trading securities
              •   Investment securities
              •   Derivatives in the non-trading book
              •   Loans and advances
              •   Investment / loans to parent entity / loans to associates / joint venture
              •   Other investments
              •   Other interest earning assets
              9.2 Interest expense Include both interest actually paid and interest payable which has accrued but has not yet been paid, linked to, for example:
              •   Deposits;
              •   Other borrowings;
              •   Derivatives in the non-trading book;
              •   Bonds, notes and other borrowings;
              •   Loan capital;
              •   Loan from parent entity;
              •   Loan from associates / joint ventures;

              Other interest bearing liabilities.
              9.4 Income from fees and commissions Include charges made for services provided by the reporting institution, for example the provision of:
              •   Current account facilities;
              •   Corporate advice;
              •   Investment management and trustee services;
              •   Guarantees and indemnities;
              •   Commission on the sale of insurance of travellers cheques;

              Foreign exchange services (if they can be separately identified).
              9.5 Fees and commission expense Include charges for all services rendered to the company by third parties (excluding those which have the character of interest).
              9.8 Net income from trading securities Include all profits or losses (including revaluation profits or losses) other than those arising from the sale of investments in subsidiary or associated companies, trade investments or the amortisation of premiums or discounts on the purchase of fixed maturity investments which are not held for dealing.
              9.9 Net income from investment securities Include net income/(losses) from investments other than the trading securities, such as available for sale and held to maturity investments.
              9.10 Income from Islamic contracts Income derived from any Islamic business undertaken by the Authorised Firm.
              9.11 Other operating income Include under this heading income from any other source (other than extraordinary items), for example:
              •   Revaluations of foreign exchange positions;
              •   Revaluation of any investment in subsidiaries or associates (if equity accounting);
              •   Share of profits from associated companies (if reporting on a consolidated basis);
              •   Profit or loss on the sale of non-trading assets — e.g. premises, equipment, subsidiary and associated companies and trade investments;
              •   Revaluation surpluses/deficits - following normal accounting practice.
              9.12.1 Provisions General Total provisions to cover non-specific bad debt provisions.
              9.12.2 Provisions Specific Total of provisions made against specific exposures.
              9.12.3 Provisions Islamic Those provisions arising from any Islamic business undertaken
              9.12.4 Provisions Other To include, for example, provisions made for taxation or dividends.
              9.13 Staff expenses Include, for example:
              •   Salary costs;
              •   Employer's contribution to any pension scheme;
              •   Costs of staff benefits paid on a per capita basis such as private medical insurance.
              9.14 Depreciation & Amortisation Charges relating, for example, to depreciation / amortisation of property, plant and equipment and other amounts written off in respect of tangible and intangible fixed assets.
              9.15 Other operating expenses Examples of expenses can be as follows:
              •   Occupancy expenses — for example, rates, rent, insurance of building, lighting, heating, maintenance costs and subsidised restaurants;
              •   Equipment;
              •   Other overhead expenses;
              •   All other expenditure not falling into one of the other specific categories.

              STATEMENT OF ASSETS

              Item No. Item Guidance
              9.17.1 Cash and Balances with Central Banks Include, for example, the following amounts:
              •   Notes and coins;
              •   Long positions in Gold bullion (including Tola Bars);
              •   Amounts placed with central banks including funds required to be placed on deposit with central banks and monetary authorities.
              9.17.2 Treasury bills and other eligible bills Treasury bills issued by the national governments or by the Central banks on behalf of the governments. Also include bills issued by other entities, which are eligible for rediscounting with the central bank.
              9.17.3 Money market placements Include deposits at call and other money market placements with banks or other money market participants
              9.18.1 Trading securities Include investments acquired principally for the purpose of selling or repurchasing it in the near term for short-term-profit-taking. This would include but not limited to, debt, equity and hybrid instruments
              9.18.2 Derivative financial instruments Include, but are not limited to, positions representing the following instruments, recorded at fair value:

              Forward and Futures contracts in Currencies, Interest rates and other financial assets
              Forward rate agreements
              Currency and interest rate swaps
              Credit derivatives
              Option contracts on currency, interest rate and other financial assets.

              These derivatives include both the exchange-traded and over-the-counter versions.
              9.18.3 Other financial instruments at fair value through profit and loss Include all financial instruments which are, upon initial recognition, designated by the entity as financial assets to be measured at fair value through profit or loss other than the trading securities included in 9.18.1.
              9.18.4 Investment securities — available for sale Include non-derivative financial assets that are designated as available for sale by the firm or that have not been classified under any of the other categories of investment in section 9.18.
              9.18.5 Investment securities - held to maturity Include non-derivative financial assets with fixed or determinable payments and fixed maturity that the firm has positive intention and ability to hold to maturity.
              9.18.6 Investments in associated undertakings Include investments in entities, including unincorporated entities such as partnerships, over which the firm has significant influence and where the entity in question is neither a subsidiary nor a joint venture operation
              9.19 Loans and advances Amounts arising from, for example:
              •   Revolving credit facilities;
              •   Credit cards outstanding balances;
              •   Housing loans (both variable and fixed rates);
              •   Term loans (both variable and fixed rates);
              •   The book value of assets leased out under finance lease agreements;
              •   Loans made under conditional hire purchase contracts;
              •   Advances purchased by or assigned to the reporting institutions, factoring or similar arrangements
              •   Other loans and advances.

              The amounts reported should be gross of provisions (as specific and general provisions should be reported in the Liabilities section of the balance Sheet) and net of interest receivable.
              9.20.1 Murabaha and Istina'a receivables Report here all receivables relating to Murabaha and Istisna'a contracts. Refer to FAS 2 and FAS 10 of AAOIFI respectively.
              9.20.2 Ijarah assets and receivables Include Ijarah assets net of depreciation/ amortisation and Ijarah receivables. Refer to FAS 8 of AAOIFI.
              9.20.3 Mudaraba Financing Capital provided on a Mudaraba basis should be reported here. Refer to FAS 3 of AAOIFI.
              9.20.4 Musharaka Financing Report capital provided on a Musharaka basis. Refer to FAS 4 of AAOIFI. Investment in the share capital of another company should be reported under "Other investments".
              9.20.5 Other investments Include any other investments undertaken through Islamic contracts, including Parallel Istisna'a assets (refer FAS 10 of AAOIFI) and capital provided on Salam contracts (refer FAS 7 AAOIFI).
              9.21 Fixed assets Include, for example, the value of the following:
              •   Plant and equipment, the residual value of items leased out under an operating lease (excluding balances relating to named Ijarah assets which should be included separately in Item No. 9.20.2);
              •   Own premises being occupied or developed for occupation by the Authorised Firm, property (excluding property acquired / held available for sale which should be included in "Other Assets", Item No. 9.23).

              The amounts reported here should be net of accumulated depreciation and amortisation.
              9.22.1 Goodwill Include amounts relating to any purchased goodwill.
              9.22.2 Other intangible assets Items to be included:
              •   Capitalised development costs
              •   Brand names, trademarks and similar rights
              •   Licences and exchange seats which may be held as part of the Authorised Firm's trading requirement.
              9.23 Other assets Assets that have not been included in any of the items above. In particular, positions in short term securities held with the intention of resale, sundry debtors, prepayments and accrued income not identified elsewhere.
              9.25.1 Direct credit substitutes These relate to the financial requirements of counterparty where the risk of loss to the Authorised Firm on the transaction is equivalent to a direct claim on the counterparty. Include here
              •   Guarantees of a financial nature to stand behind the current obligations of customers (e.g. loan guarantees);
              •   Guarantees of leasing operations;
              •   Letters of Credit and Stand-by Letters of Credit to the extent that they do not qualify for inclusion in Item No. 9.25.3 "Trade related contingents" below;
              •   Guarantees of a capital nature such as undertakings given to a non bank financial company which are considered as capital by the appropriate regulatory body. Guarantees given to a company not connected to the reporting institution should be risk weighted at 100% and those for connected companies should be deducted from the reporting institution's capital base.
              •   Acceptances granted and risk participation in bankers' acceptances. Where the reporting institution's own acceptances have been discounted by that institution the nominal value of the bills held should be deducted from the nominal amount of the bills issued under the facility and a corresponding on balance sheet entry made.
              9.25.2 Transaction related Contingents These exposures relate to the on-going trading activities of a counterparty where the risk of loss to the reporting institution depends on the likelihood of a future event which is independent of the creditworthiness of the counterparty. They are essentially guarantees that support particular non financial obligations rather than a customer's financial obligations. Include here:
              •   Advance payment guarantees
              •   Performance bonds including bid or tender bonds, warranties and indemnities (indemnities given for lost share certificates or bills of lading and guarantees of the validity of papers rather than of payment under certain conditions should be reported here);
              •   Stand by Letters of Credit relating to a particular contract or to non financial transactions (including arrangements backing, inter alia, subcontractors' and supplier's performance, labour and materials, contracts and construction bids).
              9.25.3 Trade related Contingents Report short term self-liquidating trade related items such as documentary letters of credit issued by the reporting institution that are collateralised by the underlying shipment i.e. the credit provides for the reporting institution to retain title to the underlying shipment. L/C's issued without provision for the reporting institution to retain title to the underlying shipment should be reported under direct credit substitutes above.
              9.25.4 Sale and Repurchase Agreements Only report here sale and repurchase agreements where the asset sold is not reported on the balance sheet. Where the asset is off balance sheet, the appropriate counterparty weighting is determined by the issuer of the security and not according to the counterparty with whom the transaction has been undertaken.
              9.25.5 Forward Assets Purchases The appropriate counterparty weighting should be determined by the asset to be purchased and not the counterparty with whom the contract has been entered into. Include commitments for loans and other on balance sheet items with certain drawdown. Exclude foreign currency spot deposits with value date of up to two working dates after trade date.
              9.25.6 Forward Deposits Placed Relates to agreements between two parties whereby one will pay and the other receive an agreed rate of interest on a deposit to be placed by one with the other at some pre-determined rate in the future. The weight should be determined according to the counterparty with whom the deposit will be placed. Exclude foreign currency spot deposits with value date of up to two working dates after trade date.
              9.25.7 Uncalled partly-paid shares and securities Only include here if there is a specific date for a call. If there is no specific date for a call, the item should be included as a long term commitment under Item No. 9.25.10, "Other Commitments".
              9.25.8 NIF's and RUF's Note issuance and revolving underwriting facilities should include the reporting institutions underwriting obligations of any maturity. Where the facility has been drawn down by the borrower and the notes are held by someone other than the Authorised Firm, the underwriting obligation should continue to be reported at the nominal amount.
              9.25.9 Endorsement of Bills These should be reported at the full nominal amount, less any amount for bills which the institution now holds but had previously endorsed. Endorsement of bills not accepted by banks will attract the counterparty risk weighting of the issuer. If it has been endorsed by another bank, a reduced risk weighting applies.
              9.25.10 Other Commitments All other undrawn commitments are reportable here, divided into commitments under and over one year.
              9.25.11 Assets funded by restricted PSIAs The methodology for calculating exposures financed by PSIAs are, in principle, no different to calculating exposures for a reporting institution's self financed assets. All the guidance notes above apply in their entirety unless stated otherwise.

              STATEMENT OF TOTAL LIABILITIES

              9.26 Deposits Separately identify deposits due to the financial institutions in Item No. 9.26.1. All other deposits are to be reported in the other deposit section, Item No. 9.26.2.
              9.27 Tax Liability Report all items accrued and payable in respect of the Authorised Firm's current and future tax liabilities.
              9.28 Provisions All specific and general provisions in respect of Loans and Advances and other receivables should be reported here. Exclude provisions against Islamic contracts which should be reported in Item No. 9.30 below.
              9.29 Loan Capital and Hybrid Securities Report items such as subordinated loans drawn down by the Authorised Firm.
              9.30 Liabilities arising from Islamic contracts Liabilities arising from Islamic contracts include advances received against Salam contracts (defined in Para 3 and 19 of FAS 7 issued by AAOIFI and Ijarah investment payables (refer to FAS 8 of AAOIFI).
              9.31.1 Creditors and other Liabilities Report all items not included in any of the above, such as proposed dividends payable, sundry accruals and deferred income etc.
              9.31.2 Derivative financial instruments and other trading liabilities Include, but are not limited to, liabilities arising out of positions representing the following instruments, recorded at fair value:

              Forward and Futures contracts in Currencies, Interest rates and other financial assets
              Forward rate agreements
              Currency and interest rate swaps
              Credit derivatives
              Option contracts on currency, interest rate and other financial assets.

              These derivatives include both the exchange-traded and over-the-counter versions.

              STATEMENT OF LARGE EXPOSURES

              See Guidance for Form PIB 9 — Appendix 1 — Large Exposures — Branch.

            • PRU 2.2.22 Instructional Guidelines — Form PIB 9 — Appendix 1 — Large Exposures — Branch

              Instructional Guidelines

              An Authorised Firm operating through a branch presence is required as part of its general systems and controls obligations, to identify and manage the exposures agreed and undertaken by its operations.

              The 20 largest exposures, in absolute terms, to unconnected counterparties should be listed in the first table and the 10 largest exposures, again in absolute terms, to connected counterparties should be listed in the second table.

              Item No. Column Item Guidance
              9.A1.1   Twenty Largest Exposures (Unconnected) Include in this table the twenty largest exposures to all types of counterparty except those that are connected to the branch. Exposures to individual, or groups of closely related, counterparties should be reported in descending order by size. Exposures to individual counterparties which constitute a group of closely related counterparties should be reported as one aggregate exposure.
                A Counterparty The identity of a Counterparty, as defined in the Glossary, in this context will generally be one of the categories as set out in PIB Rule A4.8.6.
                B Unconnected — Financial, Unconnected — Other, Government The Authorised Firm should clarify here into what category an exposure falls. These are set out in detail in Rules PIB A4.8.7 to PIB A4.8.11 but for the purposes of this form, an Authorised Firm should state whether an Exposure is to:
              (i) an Unconnected counterparty or group of Closely Related Counterparties that are predominantly comprised of financial businesses;
              (ii) an Unconnected counterparty or group of Closely Related Counterparties that are predominantly comprised of non-financial businesses;
              (iii) Central governments and central banks.
                C Amount of exposure at risk For exposures arising in the Non-Trading Book the amount at risk should, with certain exceptions detailed below, be reported as the book value of the Authorised Firm's actual or potential claims, contingent liabilities or assets.
              Exposures should be calculated in accordance with internationally or AAOFI accepted accounting practice.
              For exposures arising in the Trading Book, all positions should be marked-to-market daily. Where a market determined price is not readily available, the Authorised Firm may generate its own mark-to-market valuation. Positions should be valued in accordance with the procedures outlined in the Authorised Firm's trading book policy statement.
              This is set out in more detail in Rules PIB A4.8.13 to PIB A4.8.31.
                D Exposure as a percentage of company's equity The branch should use as the denominator the amount its head office has available as regulatory capital (e.g. financial resources). This is intended to provide DFSA with a guide as to the relative size and importance of the exposure for the financial institution as a whole.
                E Specific bad debt provision Include here the amount of specific bad debt provision that may have been made against a particular exposure.
                F Reduction by netting, collateral etc. As set out in PIB Rule 4.5.6 (d) (ii), the value of an exposure can be reduced through the following:
              •   Collateral — discussed in more detail in PIB Section 4.6 and PIB Rule A4.8.32
              •   Netting — discussed in more detail in Sections PIB 4.7 and PIB A4.9
              •   Securitisation — discussed in more detail in Sections PIB 4.8 and PIB A4.10
              •   Credit derivatives — discussed in more detail in Sections PIB 4.9 and PIB A4.11.
                G Exposure at reporting date after eligible set-offs Column C less the amounts in Columns E and F.
                H Amount of this exposure financed by own assets or unrestricted PSIAs For Exposures arising out of Islamic business, this column should be used to quantify the amount of the Exposure that is financed by the Authorised Firm's own assets or by unrestricted PSIA assets.
                I Amount of this exposure financed by restricted PSIAs. For Exposures arising out of Islamic business, this column should be used to quantify the amount of the Exposure that is financed by restricted PSIA assets.
              9.A1.2   Ten Largest Exposures (Connected) Include in this table the ten largest exposures to connected counterparties i.e. the dis-aggregated detail of all connected lending and exposures should be split into different counterparties within the connected group.
                A - I Bank or non-bank As detailed above for the table in for Item No. 9.A1.1

            • PRU 2.2.23 Instructional guidelines for form PIB 12 — Geographical Distribution of Assets and Liabilities

              Instructional Guidelines

              1 Authorised Firms in prudential categories 1 and 5 are required to complete this form to measure its country risk transfers. All entries should be converted from the relevant currency to dollars at the closing spot mid price on the reporting date.
              2 The information reported covers claims, other exposures, and liabilities booked by the Authorised Firm at the DIFC office and its branches. The level of consolidation for this return should be the same as that for the balance sheet. The positions of the subsidiaries carrying out the Financial Services of Accepting Deposits and Providing Credit are to be consolidated into this return.
              3 The residency of counterparties on both an immediate borrower and ultimate risk basis is to be reported with the corresponding three digit country code provided in the List of Country Codes.
              4 All claims and other exposures are to be reported gross of any provisions for impairment. Accrued interest is to be excluded from all parts of the return. Exclude all gold and silver balances, foreign coin, foreign government or bank notes, net debit or credit items in transit vis-à-vis third parties and amounts reported as insurance-related assets and liabilities.
              5 Claims, other exposures, and liabilities are to be initially classified on a geographical basis according to the mailing address of the counterparty, unless the Authorised Firm is aware that the resident status of the counterparty is different from their mailing address.

              Risk transfers

              6 Information on claims on immediate borrowers that can be reallocated to the country sector where the final risk lies, i.e., the entity of ultimate risk, is to be reported by way of outward and inward risk transfers.
              7 In line with the risk reallocation principle for measuring country exposure recommended by the Basel Committee on Banking Supervision, the country of ultimate risk or where the final risk lies is defined as the country in which the guarantor of a financial claim resides or the country in which the head office of a legally dependent branch is located.
              8 Claims on separately capitalized subsidiaries can only be considered as being guaranteed by the head office if the parent has provided an explicit guarantee. Collateral may be considered as an indicator of where the final risk lies to the extent that it is recognized as a risk mitigant under the Basel Capital Accord. The following is a list of eligible collateral:
              a cash on deposit with the lending bank including certificates of deposit or comparable instruments issued by the lending bank
              b gold
              c debt securities rated by a recognised external credit assessment institution where these are:
              i. rated at least BB- when issued by sovereigns and public sector entities (PSEs) that are treated as sovereigns by the national supervisor;
              ii. rated at least BBB- when issued by other issuers (including banks and securities firms); or
              iii. rated at least A2/P3;
              d debt securities not rated by a recognised external credit assessment institution where these are:
              i. issued by a bank;
              ii. listed on a regulated exchange;
              iii. qualify as senior debt;
              iv. all other rated issues of the same seniority by the issuing bank are rated at least BBB- or A3/P3 by a recognized external credit assessment institution;
              v. the bank holding the securities as collateral has no information to suggest that the issue justifies a rating below BBB- or A3/P3 (as applicable); and
              vi. the supervisor is sufficiently confident about the market liquidity of the security;
              e equities that are included in a main index;
              f equities that are not included in a main index but are listed on a regulated exchange; and
              g Domestic or Foreign Funds where:
              i. a price for the Units is publicly quoted daily; and
              ii. the Fund is limited to investing in the instruments listed in this section
              9 If credit derivatives are used to cover the counterparty risk of financial claims in the banking book, the country of ultimate risk of these positions is defined as the country in which the counterparty to the credit derivative contract resides. However, credit derivatives, such as credit default swaps and total return swaps, that belong to the trading book of the protection buying reporting bank should only be reported under the "Derivatives" category, and all other credit derivatives should be reported as "guarantees" by the protection seller (see guarantees and other unused credit commitments below).

              Reporting of Credit derivatives
              Buy protection Sell protection
              Banking book Risk transfers Guarantees
              Trading book Derivatives Guarantees
              10 In the case of security holdings, such as credit-linked notes and other collateralised debt obligations and asset-backed securities, a "look-through" approach should be adopted and the country of ultimate risk is defined as the country where the debtor of the underlying credit, security or derivative contract resides.
              11 Note that inward and outward risk transfers are used to report transfer of risk from one sector to another sector, even when the country of the immediate borrower and the country of ultimate risk are the same. Where banks are unable to allocate outward risk by country because the protection has been purchased to cover a group, e.g., an industry exposure, banks are to use a reasonable weighted-average allocation formula, eg. weighted-average based on total claims of the group. Amounts involved in such allocations should be insignificant.

              Example:

              12 The following example demonstrates a risk transfer. A borrower in country XXX borrows USD $1 million bank and the repayment of that loan is guaranteed by another entity in country YYY. For purposes of risk transfer, this transaction would be reported as follows:

              Country Code Loans Outward Risk Transfer Inward Risk Transfer
              XXX 1000 1000  
              YYY     1000
              13 The data in line 1 tell us that the bank has a $1 million claim on a borrower located in country XXX, and this claim is guaranteed by a resident of another country. Line 2 data tell us that the residents of country YYY have provided an unconditional credit commitment for the claims the bank has on the residents of another country. Note that the total of the "Outward Risk Transfer" column and the "Inward Risk Transfer" column (columns 3 and 4 in the above example) will be the same.
              14 The following equation illustrates how to derive claims on an ultimate risk basis:
              Total Claims (Immediate Borrower Basis) - Outward Risk Transfer + Inward Risk Transfer = Total Claims (Ultimate Risk Basis)

              Derivatives

              15 Authorised Firms are to provide data on financial claims (i.e., positive market values) resulting from derivative contracts, independent of whether they are booked as on- or off-balance sheet items. The data should be reported on an ultimate risk basis, i.e., the positions should be allocated to the country where the final risk lies. The data would, therefore, mainly comprise forwards, swaps and options relating to foreign exchange, interest rate, equity, commodity and credit derivative contracts. As previously indicated, credit derivatives that are used to cover for the counterparty risk of financial claims in the banking book should be reported as "risk transfers" and not as derivatives.
              16 The following items are common OTC derivative instruments:
              a. Forward contracts: Forward contracts represent agreements for delayed delivery of financial instruments or commodities in which the buyer agrees to purchase and the seller agrees to deliver, at a specified future date, a specified instrument or commodity at a specified price or yield. Forward contracts are not traded on organised exchanges and their contractual terms are not standardised. Forward contracts are to be reported that have been entered into by the reporting bank and are outstanding (i.e., open contracts) as at the reporting date. Contracts are outstanding (i.e., open) until they have been cancelled by acquisition or delivery of the underlying financial instrument or commodity or settled in cash.
              b. Swaps: Swaps are transactions in which two parties agree to exchange payment streams based on a specified notional amount for a specified period.
              c. OTC options: Option contracts convey either the right or the obligation, depending upon whether the reporting institution is the purchaser or the writer, respectively, to buy or sell a financial instrument or commodity at a specified price up to a specified future date. OTC option contracts include all option contracts not traded on an organized exchange. These include: swaptions, i.e., options to enter into a swap contract, and contracts known as caps, floors, collars, and corridors. Options such as call features embedded in loan, securities and other on-balance-sheet assets are not to be included. Sold options are not considered a financial claim and therefore are not to be included under derivatives.

              Guarantees and Other Unused Credit Commitments

              17 Data must be supplied on exposures to the reporting bank via guarantees and unused credit commitments other than guarantees. These are to be reported on an ultimate risk basis, i.e., the positions allocated to the country where the final risk lies. Both types of data should be reported to the extent that they represent the unutilised portion of both binding contractual obligations and any other irrevocable commitments. Performance bonds and other forms of guarantee should only be reported if, in the event of the contingency occurring, the resulting claims would have an impact on total balance sheet claims. A more detailed definition of guarantees and other credit commitments and a non-exhaustive list of typical instruments that qualify as guarantees and other credit commitments is provided below.
              18 "Guarantees" are contingent liabilities arising from an irrevocable obligation to pay to a third-party beneficiary when a client fails to perform some contractual obligation. They include secured, bid and performance bonds, warranties and indemnities, confirmed documentary credits, irrevocable and standby letters of credit, acceptances and endorsements. Guarantees also include the contingent liabilities of the protection seller of credit derivative contracts.
              19 "Other unused credit commitments" are arrangements that irrevocably obligate an institution, at a client's request, to extend credit in the form of loans, participation in loans, lease financing receivables, mortgages, overdrafts or other loan substitutes or commitments to extend credit in the form of the purchase of loans, securities or other assets. Normally commitments involve a written contract or agreement and some form of consideration, such as a commitment fee. This definition is identical to that used in the capital adequacy return. Include customers' liability under acceptances (Assets 13 of the month-end balance sheet). Do not include such items as letters of awareness or intent, comfort letters, or similar documents.

              Specific Guidance

              Item No Item Guidance
              12.1 Country Code For the relevant exposure, enter the country code found on the List of Country Codes.
              Deposits Report deposits with banks or official monetary institutions according to the location of the office where the deposit is held.
              Securities Report short term and long term securities and equities. Short term securities are those with an initial term of less than 1 year.
              Loans Report loans at book value gross of provisions for impairment.
              Distribution of claims by residual term to maturity The maturity should reflect amortisation periods or final maturity dates rather than interest adjustments or rollover dates. Instalment loans should be allocated to the periods in which instalment payments are made. Demand loans should be classified as claims with a maturity of less than one year. Equities should be reported as unallocated.


              Item No Item Guidance
              12.2 Outward Risk Transfer Report the amounts which are guaranteed or assured through some type of commitment by a party in another country or by another sector in the same country.
              Inward Risk Transfer Report the amount of any guarantees and other types of credit commitments made by residents of other countries or by another sector in the same country.
              Total Claims ultimate risk basis Report the total "claims — immediate borrower basis" less "outward risk transfers" plus "inward risk transfers".
              Other Exposures ultimate risk basis Report separate amounts for guarantees, derivatives and other as previously defined.


              Item No Item Guidance
              12.3 Official Monetary Institutions Report deposits payable to official monetary institutions.
              Other Banks Report deposits payable to other banks.
              Other Liabilities Report any other liabilities.

              List of Country Codes

              Country Country Code
              Afghanistan 648
              Albania 515
              Algeria 702
              American Samoa 832
              Andorra 403
              Angola 704
              Anguilla 274
              Antarctica 834
              Antigua and Barbuda 207
              Argentina 303
              Armenia 647
              Aruba 208
              Australia 812
              Austria 437
              Azerbaijan 649
              Bahamas 209
              Bahrain 604
              Bangladesh 650
              Barbados 212
              Belarus 517
              Belgium 406
              Belize 307
              Benin (formerly Dahomey) 724
              Bermuda 215
              Bhutan, Kingdom of 652
              Bolivia 311
              Bosnia-Hercegovina 519
              Botswana 706
              Brazil 315
              British Indian Ocean Territory 710
              British Virgin Islands 218
              Brunei 654
              Bulgaria 521
              Burkina Faso 802
              Burundi 708
              Cambodia 664
              Cameroon Republic 712
              Canada 146
              Cape Verde Islands 714
              Cayman Islands 221
              Central African Republic 716
              Chad 718
              Chile 319
              China, People's Republic of 640
              Christmas Island 840
              Cocos (Keeling) Islands 814
              Colombia 323
              Comoros Islands 720
              Congo, Democratic Republic of (formerly Zaire) 804
              Congo, People's Republic of 722
              Cook Islands 826
              Costa Rica 327
              Côte d'Ivoire 742
              Croatia 525
              Cuba 224
              Cyprus 481
              Czech Republic 526
              Denmark 409
              Djibouti (formerly French Afars & Issas) 730
              Dominica 227
              Dominican Republic 230
              Ecuador 331
              Egypt 608
              El Salvador 335
              Equatorial Guinea 726
              Eritrea 727
              Estonia 529
              Ethiopia 728
              Falkland Islands 233
              Faroe Islands 479
              Fiji 842
              Finland 441
              France 412
              French Guiana 339
              French Polynesia 844
              Gabon 732
              Gambia 734
              Georgia 657
              Germany 415
              Ghana 736
              Gibraltar 485
              Greece 445
              Greenland 480
              Grenada 236
              Guadeloupe 239
              Guam 848
              Guatemala 343
              Guernsey 486
              Guinea 738
              Guinea-Bisseau 740
              Guyana 347
              Haiti 242
              Heard and MacDonald Islands 816
              Honduras 351
              Hong Kong 658
              Hungary 539
              Iceland 449
              India 660
              Indonesia 662
              Iran 610
              Iraq 612
              Ireland 418
              Isle of Man 487
              Israel 614
              Italy 421
              Jamaica 248
              Japan 135
              Jersey 488
              Johnston Island 850
              Jordan, Hashemite Kingdom of 616
              Kazakhstan 665
              Kenya 744
              Kiribati (Canton and Enderbury, Gilbert Island, Phoenix Islands, Line Islands) 846
              Korea, Democratic People's Republic of (north) 642
              Korea, Republic of (south) 666
              Kuwait, State of 618
              Kyrgyzstan 667
              Laos 668
              Latvia 540
              Lebanon 620
              Lesotho 746
              Liberia 748
              Libya, Arab Republic of 622
              Liechtenstein 453
              Lithuania 541
              Luxembourg 424
              Macau 670
              Macedonia 542
              Madagascar (Malagasy Republic) 750
              Malawi 752
              Malaysia 672
              Maldives, Republic of 674
              Mali 754
              Malta 489
              Marshall Islands 872
              Martinique 257
              Mauritania 756
              Mauritius 758
              Mexico 355
              Micronesia 874
              Midway Island 852
              Moldova 543
              Monaco 427
              Mongolia 644
              Montserrat 260
              Morocco 760
              Mozambique 762
              Myanmar (formerly Burma) 656
              Namibia 764
              Nauru 818
              Nepal, Kingdom of 676
              Netherlands 430
              Netherlands Antilles 263
              New Caledonia 854
              New Zealand 824
              Nicaragua 359
              Niger 766
              Nigeria 768
              Niue Island 828
              Norfolk Island 820
              Norway 457
              Oman 626
              Pacific Islands (Trust Territory) 858
              Pakistan 678
              Palau 876
              Palestinian Territory 627
              Panama 363
              Panama Canal Zone 367
              Papua New Guinea 822
              Paraguay 371
              Peru 375
              Philippines 680
              Pitcairn Islands 860
              Poland 545
              Portugal 461
              Puerto Rico 202
              Qatar 628
              Reunion Islands 770
              Romania 551
              Russian Federation 553
              Rwanda 774
              Samoa 870
              San Marino 491
              Sao Tomé and Principe 778
              Saudi Arabia 630
              Senegal 780
              Serbia and Montenegro 554
              Seychelles 782
              Sierra Leone 784
              Sikkim 684
              Singapore 686
              Slovak Republic 552
              Slovenia 555
              Solomon Islands 836
              Somalia 786
              South Africa 701
              Spain 465
              Sri Lanka 688
              St. Helena 776
              St. Kitts-Nevis 272
              St. Lucia 275
              St. Pierre and Miquelon 278
              St. Vincent 281
              Sudan 790
              Suriname 379
              Swaziland 792
              Sweden 469
              Switzerland 473
              Syria 632
              Taiwan 690
              Tajikistan 691
              Tanzania 794
              Thailand 692
              Timor Leste 682
              Togo 796
              Tokelau or Union Islands 830
              Tonga 862
              Trinidad and Tobago 287
              Tunisia 798
              Turkey 477
              Turkmenistan 693
              Turks and Caicos Islands 290
              Tuvalu 838
              U.S. Miscellaneous 864
              U.S. Virgin Islands 205
              Uganda 800
              Ukraine 556
              United Arab Emirates 634
              United Kingdom 124
              United States 110
              Uruguay 383
              Uzbekistan 695
              Vanuatu (formerly New Hebridges) 856
              Vatican 433
              Venezuela 387
              Vietnam 646
              Wake Island 866
              Wallis and Futuna Islands 868
              Western Sahara 788
              Yemen, Republic of 636
              Zambia 806
              Zimbabwe (formerly Rhodesia) 772

            • PRU 2.2.25 Guidance for form PIB 13 — Provisions for Impairment

              Instructional guidelines

              Authorised Firms in category 1 and 5 are required to complete this form. All entries are to be converted from the relevant currency to US dollars at the closing spot mid price on the reporting date.

              Specific Guidance

              Item No Item Guidance
              13.1 Opening Balance Report the provisions as at the end of the previous period.
              13.2 Charge from Profit and Loss The additional provisions that management considers adequate to reduce the recorded investment in the firm's books net of other movements. The amount of provisions should be the same as recorded on the profit and loss statement.
              13.3 Write offs The reduction of provisions due to a write off of the corresponding investment.
              13.4 Recoveries The increase of provisions due to funds recovered from an investment that had previously been written off.
              13.5 Other Include and specify any other credit related adjustments to provisions occurring during the period.
              13.6 Closing Balance Report the provisions as at the end of the current period. This amount should be the opening balance adjusted by the items in 13.2, 13.3, 13.4 and 13.5. (13.1+13.2-13.3+13.4+13.5)

            • PRU 2.2.26 Guidance for form PIB 14 — Exposures in Arrears

              1. Authorised Firms in category 1 and 5 are required to complete this form in respect of its exposures in arrears. All entries are to be converted from the relevant currency to US dollars at the closing spot mid price on the reporting date.
              2. The Amount should be the total of the exposures corresponding to the time in arrears from the day on which the payment for the exposure was due as per the contractually agreed terms. The Amount should be gross of any provisions for impairment.
              3. The number of exposures should be the total number of exposures corresponding to relevant amount.
              4. The provision applied should be the specific provision applied to the relevant amount.

            • PRU 2.2.27 Instructional Guidelines for Form PIB100 — Statement of Financial Group Capital Adequacy.

              Instructional Guidelines

              1. An Authorised Firm that is required to prepare a Financial Group Capital Adequacy Report may use this form to submit that Report. Use of this form is not mandatory.
              2. Where an Authorised Firm chooses to use form PIB100 for its Financial Group Capital Adequacy Report, it must do so in accordance with the instructional guidelines in this section.
              3. An Authorised Firm completing this form must present:
              a. in the header portion of the Form the information required by PIB Rule A7.2.2(2)(a), (b) and (c);
              b. at item 1, the Financial Group Capital Resources;
              c. at item 2, the Financial Group Capital Requirement
              4. An Authorised Firm completing this form must present at item 4:
              a. the names of all Authorised Firms and Financial Institutions in the Financial Group; and
              b. where an entity disclosed at (a) is itself the Parent of a Financial Group, the Financial Group Capital Resources of that group at column 1, and the Financial Group Capital Requirement of that group at column 2.
              5. Where an entity is disclosed in accordance with instructional guideline 5(a) is not the Parent of a Financial Group, the entries at columns 1 and 2 of item 4 must be left blank.
              6. An Authorised Firm completing this form must present at item 5:
              a. the names of all Authorised Firms and Financial Institutions meeting the conditions set out at PIB Rule A7.2.2(2)(i);
              b. in column 1, the Capital Resources or Adjusted Capital Resources as applicable of that entity; and
              c. in column 2, the capital requirement of that entity calculated in accordance with PIB Rule A7.2.2 (4).
              7. Where the space on the form is inadequate for the disclosures required at item 4 or item 5, the Authorised Firm completing the form must attach a continuation sheet in the form of PIB100. Separate continuation sheets must be used for disclosures required at items 4 and 5. Continuation sheets must be sequentially numbered and each continuation sheet must be completed in accordance with the Rules applicable to items 4 and 5.
              8. At each of item 4 and item 5, the Authorised Firm completing the form must indicate whether or not a continuation sheet is attached, and if so the number of such continuation sheets.
              9. Form PIB100 must be signed in accordance with PIB Rule A7.2.2 (4).

        • PRU 3 PRU 3 Instructional Guidelines

          • PRU 3.1 PRU 3.1 PIN 1 — Statement of Financial Position

            • Instructional Guidelines

              1. The 'Statement of Financial Position' provides the DFSA with the necessary information on assets, liabilities and capital to undertake an assessment of an Insurer's financial position and performance and facilitate assessing compliance with the Minimum Capital Requirements.
              2. section PIN 5.3 deals with the recognition and measurement of assets and liabilities on this form.
              3. The instructional guidelines in this section provide instructions as to the completion of specific lines on the form. Instructions that are provided in respect of a particular category of current assets or liabilities are normally applicable also (with the appropriate changes) to the corresponding category of non-current assets or liabilities, and vice versa.
              4. The completion of this form requires Insurers to make estimates, for example, in assigning assets and liabilities as current or non-current. As an example, the settlement date of outstanding claims, particularly IBNR, is often uncertain. An Insurer may make a reasonable estimate of the amount that is expected to be settled within twelve months, and record that amount as a current liability, with the balance being recorded as non-current. A similar approach would be acceptable for the assets representing reinsurance and other recoveries that would not normally become due and receivable until the underlying claim has been settled.
              5. Insurers are required to disclose the amount included in certain totals with respect to parties Related to the Insurer. These disclosures exclude amounts due to or from the Insurer under Contracts of Insurance.
              6. This form is required for each reporting unit in respect of which the Insurer must prepare a Return, except for a DIFC Business Return.
              7. Assets and liabilities must be reported as current or non-current. Current assets and liabilities are those expected to mature or be realised within a twelve-month period from the date as at which the Return is drawn up. Where an asset or a liability includes elements that are current as well as elements that are non-current, the asset or liability must be separated into the current and non-current components, if necessary by means of an estimate.
              Item No. Item Instructional Guidelines
              1. Cash and liquid assets Item 1 on the form includes only cash and liquid assets. Insurers must have regard to the following principles:
              a Item 1.2 includes only deposits available within 24 hours that are used by the Insurer for daily purposes of liquidity and operations. Deposits that form part of the Insurer's investments are reported at item 3 or item 7; and
              b Bank overdrafts must be reported at item 21.3, not netted against item 1 unless there is a legal right of offset.
              2. Receivables Item 2 on the form includes only receivables. In completing this item, Insurers must have regard to the following principles:
              a Receivables must be stated net of any provision for doubtful debt or impairment of asset;
              b Item 2.2 includes items such as subrogation or salvage recoveries in respect of claims that have been paid;
              c Item 2.3 includes instalment premiums on General Insurance contracts that are not yet due for payment. It also includes premiums on General Insurance contracts that have been entered into but not yet recorded. It does not include premiums on Long-term Insurance contracts that are not yet due for payment;
              d Item 2.4 includes amounts due and receivable under reinsurance contracts, including premiums due from cedants and deposits retained by cedants, as well as amounts due from reinsurers in respect of recoveries against claims that have been paid. Where there is a legal right of set-off, an Insurer may report the working balance on an account with a cedant or reinsurer as a net receivable or payable amount. However, if there is no legal right of set-off, amounts must be recorded gross as receivables and payables;
              e Item 2.5 includes amounts in respect of reinsurance and other recoveries in respect of claims that have been incurred but not paid, up to the date to which the Return is drawn up. This includes reinsurance and other recoveries in respect of IBNR. Because of the uncertainty of the outcome of outstanding claims and IBNR, it is necessary to estimate at least a part of this balance. The basis on which the estimate is made must be consistent with the basis of estimation of the related liability, reported at item 18;
              f Reinsurance and other recoveries in respect of claims that have not yet been incurred are reported at item 2.6. It is necessary to estimate this balance. The basis on which the estimate is made must be consistent with the basis of estimation of the related liability, reported at item 19; and
              g Where, in determining the amounts to be reported at item 2.4 or 2.5, an Insurer has made or considered making a provision for doubtful debt in respect of recoveries due or potentially due from a reinsurer, the Insurer must take into account the potential need to make a provision when determining any estimate to be included at item 2.5 or 2.6.

              It is common practice for Insurers to account for their exposures on General Insurance contracts in force by means of an unearned premium provision, an asset representing deferred reinsurance expense and (where necessary) a premium deficiency reserve. Insurers are referred to the instructional guidelines to item 19. An Insurer that uses an unearned premium provision and premium deficiency reserve as a proxy for Premium Liabilities may record its deferred reinsurance expense at item 2.6 (for the current portion) and item 7.6 (for the non-current portion).
              3. Investments An Insurer's current investments are reported at item 3. This item does not include derivatives used to hedge investments reported here. Hedging derivatives are included in item 5. Insurers must have regard to the following principles when completing item 3:
              a Investments that are strategic in nature must be assumed to be noncurrent, and must be reported at item 8 or item 9; and
              b Deposits that are of the nature of security deposits, or retentions under contracts, are not reported at item 3.1 but are reported as receivables.

              Investments that take the form of mudaraba or musharaka contracts must be reported in accordance with their nature. A contract that takes the form of a collective investment, where the Insurer is one of several investors providing capital to a mudarib who then provides the capital to the entrepreneur, should be reported as a collective investment (where it does not fall to be reported as a Profit Sharing Investment Account). Where however, a contract of mudaraba or musharaka is entered into by an Insurer as an investment directly with an entrepreneur, or through a mudarib with the Insurer as sole rab ul mal, the investment should be reported as a contract of mudaraba or musharaka as appropriate.
              4. Deferred Tax assets Deferred tax assets that are current assets are reported at item 4. Insurers must have regard to the following principles when completing item 4:
              a Netting off of deferred tax assets and liabilities is permitted only where both the asset and the liability relate to the same tax to which the Insurer is subject, and are expected to crystallise in the same taxation period; and
              b Amounts that represent refunds due from taxation authorities, that are not contingent on earning future taxable income, are not deferred tax assets but are receivables.
              5. Other Current Assets Item 5 includes current assets that do not fall to be reported under other items. In completing this item, Insurers must have regard to the following principles:
              a Acquisition costs in respect of General Insurance business must not be deferred, as the basis on which the premium liability is determined requires immediate expensing of acquisition costs; and
              b Item 5.2 does not include deferred reinsurance expense, as item 2.6 stands in place of this asset.
              6. Total Current Assets Item 6.1 reports the total of amounts due from, balances with or investments in Related parties that form a part of the total of current assets. This amount excludes amounts due under insurance contracts.
              7. Receivables
              (non current)
              In completing item 7 (non-current receivables) Insurers should have regard to the principles set out in this section for the equivalent categories of current assets.
              8. Investments (other than related entities) In completing item 8 (non-current investments) Insurers should have regard to the principles set out in this section for the equivalent categories of current assets.
              9. Investments in related entities In item 9, investments in Related parties must be recognised and measured in accordance with the principles of chapter PIN 5. PIN Rule 5.7 requires an Insurer to make allowance for any Minimum Capital Requirement or equivalent to which a Subsidiary or Associate is subject in the jurisdiction in which it is incorporated.
              10. Plant and equipment In item 10, an Insurer must exclude any properties of the Insurer, whether or not occupied. Properties must be reported at item 3.6 or 8.6 as appropriate.
              11. Intangible assets In item 11, an Insurer must report intangible assets after deducting any amortisation or impairment charge in respect of those assets.
              12. Deferred tax assets In completing item 12 (non-current deferred tax assets) Insurers should have regard to the principles set out in this section for the equivalent categories of current assets.
              13. Other Assets In completing item 13 (other non-current assets) Insurers should have regard to the principles set out in this section for the equivalent categories of current assets.
              14. Total Non-current assets Item 14.1 reports the total of amounts due from, balances with or investments in Related parties that form a part of the total of current assets. This amount excludes amounts due under insurance contracts.
              15. Total Assets  
              16. Creditors and accruals  
              17. Amounts due on reinsurance contracts Amounts due under reinsurance contracts at item 17 must include premiums payable but not yet due for payment under the terms of reinsurance contracts, and deposits withheld from reinsurers. Other items attributable to reinsurance contracts such as the reinsurer's portion of recoveries and salvage and commissions due to reinsurers must also be included under this item.
              18. Outstanding Claims Provision (including IBNR) Item 18 reports the current portion of the Insurer's provision for outstanding claims. This item must be completed having regard to the following principles:
              a The liability must represent the estimated cost to the Insurer of settling claims which it has incurred at the reporting date but which have not been finalised. The liability is in respect of both direct business and inward reinsurance business and must take into account unpaid claims, unreported claims, adjustments for claims development and the direct and indirect claims settlement costs that the Insurer expects to incur in settling its outstanding claims;
              b In the case of Long-Term Insurance Business, this item must include all claims liabilities in respect of Contracts of Insurance that are no longer included in the calculation of the net policy benefits at item 20;
              c The liability must be stated without deducting reinsurance and other recoveries (these are disclosed as an asset as reinsurance receivables);
              d The requirements for recognition and measurement of this liability are set out in PIN Rule 5.4 and PIN Rule 5.6; and
              e The liability does not include any amounts for catastrophe reserve, equalisation reserve or similar provisions that an Insurer may be required to maintain to satisfy regulatory requirements in a jurisdiction other than the DIFC.
              19. Premium liabilities under General Insurance contracts Item 19, Premium Liability, represents the current portion of the cost of providing insurance service over the unexpired period of general insurance contracts in force at the balance date. This item must be completed having regard to the following principles:
              a The Premium Liability reported is required to cover the value of future claims payments and associated direct and indirect settlement costs arising during the unexpired portion of the contracts in question.
              b Item 19 must be recorded without deducting reinsurance and other recoveries (these are disclosed as an asset as reinsurance receivables); and
              c The requirements for recognition and measurement of this liability are set out in PIN Rule 5.4.

              As stated in the Guidance to PIN Rule 5.4.7, it is common practice for Insurers to account for their exposures on General Insurance contracts in force by means of an unearned premium provision and (where necessary) a premium deficiency reserve. Where the aggregate of the unearned premium provision and the premium deficiency reserve (both gross of reinsurance) can be shown to be not less than the amount of Premium Liability determined in accordance with PIN Rule 5.4, an Insurer may use that aggregate as a proxy for Premium Liability for the purposes of recording items 19 and 29 on this form.
              20. Net policy benefits under Long-Term insurance contracts in force Item 20 represents the net value of future Policy Benefits under Long-Term Insurance contracts that are in force as at the date to which the Return is made up. The amount reported here must be determined in accordance with PIN Rule 5.6.
              21. Borrowings  
              22. Tax liability  
              23. Provisions Item 23, provisions, must be completed having regard to the following principles:
              a A provision must be made at item 23.1 in respect of dividends payable out of past and current year profit, to the extent that profit has been recognised;
              b Employee entitlements at item 23.2 include annual leave, gratuity, accrued allowances, staff housing and loan benefits, healthcare, pension and other employee entitlements; and
              c A provision must be made at item 23.3 in respect of any costs that the Insurer expects to incur as a result of restructuring, including severance, termination and redundancy payments, and integration costs.
              24. Other Liabilities  
              25. Total Current Liabilities Item 25.1 reports the amount of current liabilities representing amounts due to Related parties, other than amounts due under insurance contracts.
              26. Creditors and accruals In completing item 26, Insurers should have regard to the principles set out in these instructional guidelines for the equivalent categories of current liabilities.
              27. Amounts due on reinsurance contracts In completing item 27, Insurers should have regard to the principles set out in these instructional guidelines for the equivalent categories of current liabilities.
              28. Outstanding Claims Provision (including IBNR) In completing item 28, Insurers should have regard to the principles set out in these instructional guidelines for the equivalent categories of current liabilities.
              29. Premium liabilities under General Insurance contracts In completing item 29, Insurers should have regard to the principles set out in these instructional guidelines for the equivalent categories of current liabilities.
              30. Net policy benefits under Long-Term Insurance contracts in force In completing item 30, Insurers should have regard to the principles set out in these instructional guidelines for the equivalent categories of current liabilities.
              31. Borrowings In completing item 31, Insurers should have regard to the principles set out in these instructional guidelines for the equivalent categories of current liabilities.
              32. Tax liability In completing item 32, Insurers should have regard to the principles set out in these instructional guidelines for the equivalent categories of current liabilities.
              33. Provisions In completing item 33, Insurers should have regard to the principles set out in these instructional guidelines for the equivalent categories of current liabilities.
              34. Other Liabilities In completing item 34, Insurers should have regard to the principles set out in these instructional guidelines for the equivalent categories of current liabilities.
              35. Loan capital and hybrid securities Item 35 includes all loan capital and hybrid securities that have been issued by the Insurer and have a residual term to maturity of more than one year. Any loan capital or hybrid securities that have a residual term to maturity of less than one year should be reported as borrowings, at item 21.
              36. Total Non-Current Liabilities Item 36.1 reports the amount of non-current liabilities representing amounts due to Related parties, other than amounts due under insurance contracts and amounts reported at line 35.
              Item 36.2 reports the amount reported at item 35 representing interests of Related parties in loan capital or hybrid securities issued by the Insurer.
              37. Total Liabilities  
              38. Net assets  
              39. Equity In completing item 39, Equity, Insurers must have regard to the following principles:
              a Item 39.7 must be equal to item 38;
              b Hybrid securities and loan capital are reported at item 35, not item 39;
              c Item 3.19 is not used in a Fund Return;
              d Item 39.3 is used only in a Fund Return, to record amounts of capital transferred into the Long-Term Insurance Fund; and
              e Where an Insurer makes use of item 39.6, the Insurer must state in a Supplementary Note the nature of the amount recorded at this item.

              Insurers must record at item 39.8 the amount included at item 39.1 meeting the following descriptions:
              a in the case of a Global Return of an Insurer that is not a Protected Cell Company, the amount of ordinary share capital meeting the description at PIN Rule A3.5.1(d);
              b in the case of a Global Return of an Insurer that is a Protected Cell Company, the amount of ordinary share capital meeting the description at PIN Rule A5.5.1(e); and
              c in the case of a Cell Return, the amount of ordinary share capital meeting the description at PIN Rule A5.10.1(d).

              No amount must be recorded at item 39.8 in the case of a Fund Return.

              An Insurer must provide the following information in a Supplementary Note to this form:
              a any amount included in item 39.7 that is not available to meet the Insurance Liabilities of the Insurer;
              b the amount and details of any guarantees (apart from guarantees arising under Contracts of Insurance) given by the Insurer;
              c the amount and details of any contingent liabilities existing as at the date to which the Return is made up; and
              d where the amount of item 39.4 is not equal to the sum of items 39.4 and 39.5 for the comparative reporting period, a reconciliation of the differences. This applies only when the form forms a part of the Annual Regulatory Return.

              Derived from DFSA RM44/2007 (Made 1st June 2007). [VER2/06-07]
              [Amended] DFSA GM2/2007 (Made 5 July 2007). [VER3/08-07]

          • PRU 3.2 PRU 3.2 PIN 2 — Statement of Capital Adequacy

            • Instructional Guidelines

              1. This form summarises the capital adequacy position of the Insurer so far as concerns the reporting unit for which it is prepared (Global, Cell, or Fund).
              2. The same form is used for all types of Return, although in the calculation of the capital requirements applicable to different Insurers and to their Cells and Long-Term Insurance Funds, different terminology is used. The terms on the face of the form need to be replaced with the specific equivalent terms from the relevant section (as set out below in the interpretation table), depending on the nature of the Insurer and the type of Return.
              3. This form lists a number of adjustments to arrive at the figure to be compared to the Minimum Capital Requirement applicable to the reporting unit. The purpose of these adjustments is to remove significant anomalies that may arise due to the flexibility available to Insurers in selecting their accounting bases. Therefore, not all of these adjustments will be applicable to all Insurers. An item must not be added to the base capital figure if it is already included in the base capital figure because of the accounting basis adopted.
              4. The effect of the instructions, in line with the Rules in PIN, on the Return of a Takaful Insurer is to exclude from equity any element of equity that is not available to participate in the surpluses or deficits of the Insurance Business of the Takaful Insurer, either directly or by loan to the Insurance Fund. Loans that have been made from the Owners' Equity to the Insurance Fund are included in base capital without restriction, while amounts that are available for loan are treated as hybrid capital.
              5. This form is required for each reporting unit in respect of which the Insurer must prepare a Return, except for a DIFC Business Return.
              6. Insurers must follow the requirements of PIN chapter 4 when preparing this form.
              Item No. Item Instructional Guidelines
              1. Base capital Item 1, Base capital, represents the starting-point for the calculation of the capital resources of the Insurer to be compared to the Minimum Capital Requirement applicable to the Insurer. This item must be completed having regard to the following principles:
              a Item 1.1, Equity, must be equal to total equity reported at item 39.7 on form 1, less debt-financed equity reported at line 39.8 on form 1;
              b Item 1.2, Owners' Equity, must be equal to the amount of Owners' Equity in a Takaful Insurer that is available for loan to the Insurance Fund. It does not include any amount of loans made from Owners' Equity to the Insurance Fund and not repaid. This item applies only to Takaful Insurers;
              c Any amount recorded at item 1.3.1 must not exceed the amount recorded at item 35.1 on form 1;
              d Any amount recorded at item 1.3.2 must not exceed the amount recorded at item 35.2 on form 1;
              e Item 1.3.3 may only be used by a Takaful Insurer. This item must equal item 1.2; and
              f Item 1.3.4 may not exceed the amount of item 39.7 on form 1.
              2. Adjustments to base capital in accordance with PIN Item 2, Adjustments to base capital in accordance with PIN, must be completed having regard to the following principles:
              a Amounts referred to in item 2.1 must not be reported if those amounts are included at item 1.7;
              b Amounts referred to in item 2.2 must not be reported if those amounts are excluded from item 1.7;
              c Item 2.1.1, minority interests in subsidiaries, applies only where an Insurer excludes from its equity an amount representing minority interests in a controlled entity that is not accounted for as an investment;
              d Item 2.1.2, liability for dividends to be paid in the form of shares, applies only where an Insurer has recorded as a liability a provision for dividends that are to be paid by issuing shares. This item does not apply to a Fund Return;
              e Item 2.2.1 applies to the liability referred to in PIN Rule A3.4.3(a) and equivalent provisions in PIN Rule A5.4.3(a), PIN Rule A5.8.3(a) and PIN Rule A7.4.2(a). This item does not apply to a Fund Return;
              f Item 2.2.2 applies only to a Return of a Takaful Insurer. This item represents amounts of Owners' Equity that are not available for loan to the Insurance Fund or to participate in surpluses or deficits of the Insurance Fund;
              g Item 2.2.3 represents investments of the Insurer or by any Subsidiary of the Insurer in the base capital of the Insurer recorded at item 1.4;
              h Item 2.2.4 represents the amount of any tax on capital gains, that was not recognised as a liability on form 1, and that would be incurred by the Insurer if the investments reported on form were realised at the values shown on that form;
              i Item 2.2.5 must be equal to the amount of any deferred acquisition costs included on form 1, whether as a separate asset or as a reduction from liabilities;
              j Item 2.2.6 must be equal to the sum of items 4.3 and 12.3 on form 1;
              k Item 2.2.7 must be equal to the sum of any asset recorded on form 1 and representing the value of in-force Long-Term Insurance Business;
              l Item 2.2.8 must be equal to the sum of item 11.3 on form 1, and any other intangible assets recorded on form 1 and not otherwise excluded from base capital;
              m Item 2.2.9 applies only to a Return of a Takaful Insurer. This item represents any amount of Zakah or charity fund of a Takaful Insurer that is not otherwise excluded from base capital;
              n Item 2.2.10 is intentionally blank.
              o Item 2.2.11 must be equal to the amount reported at item 10.3 on form 1; and
              p Item 2.2.12 must record the amount of any other assets, not otherwise excluded from base capital, that are not available to meet the Insurance Liabilities of the Insurer recorded on form 1.

              Item 2 would normally be expected to include assets that are subject to mortgages or other charges, or than cannot for some other reason be realised for the benefit of policyholders.
              3. Adjusted Equity Item 3.11 may only be used with the written approval of the DFSA, to record an adjustment to the Minimum Capital Requirement that has been approved in writing by the DFSA.
              4. Hybrid Capital Adjustment Item 4.1, Hybrid Capital Adjustment before DFSA approval, must be calculated as the amount by which the sum of items 1.3.1 to 1.3.4 exceeds 15/85 of the amount arrived at by deducting item 1.2.1 from item 1.1.

              Item 4.2, additional hybrid capital approved by DFSA, may only be used to record additional amounts of hybrid capital that have been approved in writing by the DFSA, in accordance with PIN Rule A3.5.2, PIN Rule A5.5.4, PIN Rule A5.10.4 or PIN Rule A7.5.3. The amount of item 4.2 may not exceed the amount of item 4.1

              Item 4.1 deducts hybrid capital that would normally be inadmissible because it exceeds the prescribed percentage. Item 4.2 reinstates hybrid capital that had been disallowed by item 4.1. Item 4.2 does not show the total amount of admissible hybrid capital, only that portion that exceeds the 15% ceiling.
              5. Adjusted Capital Resources  
              6. Minimum Capital Requirement Item 6, Minimum Capital Requirement sets out the components of the Minimum Capital Requirement applicable to the reporting unit of the Insurer in respect of which the Return is completed. For each reporting unit, the components must be calculated in accordance with the chapter applicable to that reporting unit. The terms used in this item must be interpreted in accordance with section 3.16.
              7. Absolute minimum requirement applicable to reporting unit Item 7, Absolute minimum