The valuation error report should be made using the insurer‘s company letterhead and sent via electronic means. The report should contain the following information:
1. State the name of the ILP sub-fund and class(es) of units affected by valuation error.
2. Describe the nature of the error (e.g. overvalued or undervalued) and state the magnitude of error as a percentage of the ILP sub-fund‘s Net Asset Value (NAV).
3. Attach a calculation of the valuation error.
4. State when and how the valuation error was discovered.

If compensation (i.e. valuation error represents 0.5% or more of the ILP sub-funds NAV per unit) is required:
1. State the number of affected Singapore policy owners (as recorded in the sub-fund register) who (a) subscribed; and (b)redeemed, during the time period over which the valuation occurred, if any.
2. State the amount of compensation to be paid to (a) policy owners; and (b) the ILP sub-fund, if any.
3. State the name of the entity that pays for the compensation.
4. Attach a calculation of the total compensation to be made.
5. Describe the measures taken, or to be taken, to improve internal controls and prevent the occurrence of similar incidents.

The requirement to compensate policy owners does not apply if the amount of compensation due to any single policy owner does not exceed $20. For avoidance of doubt, the requirement to compensate the ILP sub-fund for any losses incurred would apply in all circumstances where the valuation error represents 0.5% or more of the ILP sub-fund‘s NAV per unit.

Performance fees payable by the ILP sub-fund should meet the following requirements:
(a) the calculation of performance fees payable should be equitable to all policy owners;
(b) the performance fee should be calculated and paid after consideration of all other payments;
(c) the period over which the performance fee accrues and the frequency with which it crystallises should be appropriate. Crystallisation of performance fee should be no more frequent than once a year;

Where the performance fee is calculated based on a fulcrum fee arrangement, the fulcrum fee should increase or decrease proportionately with the investment performance of the ILP sub-fund as compared to the specified benchmark and be limited to between zero and 200% of the base fee.

Where performance fees are payable by the ILP subfund, the product summary should disclose:
(i) that a performance fee is payable and to whom it is payable;
(ii) if applicable, that a performance fee can be levied even if the return of the ILP sub-fund is negative;
(iii) the maximum amount or percentage of the ILP sub-fund‘s NAV that the performance fee might represent in an annual accounting period; and
(iv) whether the ILP sub-fund achieves equalisation of performance fees.

An ILP sub-fund should not engage in:
a. direct lending of monies;
b. the granting of guarantees;
c. underwriting; or
d. short selling except where this arises from financial derivatives which are invested

Any breach as a result of any:
(a) appreciation or depreciation in the value of the ILP sub-fund‘s underlying investments;
(b) redemption of units or payments from the ILP sub-fund;
(c) change in the capital of a company (examples of changes in the capital include changes in the total outstanding shares of a company arising from the issuance of (pro-rata) rights or bonuses);
(d) reduction in the weight of a constituent in the benchmark being tracked by an ILP sub-fund.

In assessing whether a name is undesirable or misleading, the MAS will consider factors including whether the name:
(a) is substantially similar to the name of another ILP sub-fund;
(b) implies that the ILP sub-fund has merits which are not, or might not be, justified;
(c) implies that the manager of the ILP sub-fund has particular qualities, which may not be justified;
(d) is inconsistent with the ILP sub-fund’s investment objective or approach;

The use of the following terms, or any other derivative or form of such terms, in an ILP sub-fund‘s name and description is prohibited:
(a) “capital protected”; and
(b) “principal protected”.

In assessing an application for a financial adviser’s licence, the MAS takes into consideration the following factors:
(a) whether the applicant employs or appoints at least two-full time individuals as appointed representatives1 for the provision of financial advisory services which the corporation is seeking to be licensed to provide.
(b) whether the Chief Executive Officer [“CEO”]2 and all Executive Directors [“EDs”] have a minimum of five years of relevant working experience in respect of the financial advisory services.
(c) whether the applicant’s board of directors comprise a minimum of two members, with at least one of whom is resident in Singapore.
(d) whether the CEO of the applicant is resident in Singapore.

An applicant must have in force a standalone non-hybrid Professional Indemnity Insurance policy [“PII”] under which the limit of indemnity covered should be an amount of not less than S$500,000 and under which the deductible allowed must not be more than 20% of the applicant’s net asset value6 at the end of its immediately preceding financial year.

Conditions to be Satisfied for Group PII
i)Minimum coverage has to be at least five times the required quantum under a stand-alone non-hybrid PII.
ii)If the deductible of the Group PII is greater than 20% of the applicant’s net asset value / net head office funds at the end of its immediately preceding financial year, an undertaking from the applicant’s parent company to cover the excess in the event of a claim will be required.

An applicant should have a minimum three-year proven track record in the financial advisory business.

The criteria for considering whether a relevant person is fit and proper include, but are not limited to the following:
(a) honesty, integrity and reputation;
(b) competence and capability; and
(c) financial soundness.

The factors as set out in the following paragraphs are relevant to the assessment of the honesty, integrity and reputation of a relevant person. The factors include, but are not limited to, whether the relevant person:
(a) has been refused the right or restricted in its or his right to carry on any trade, business or profession for which a specific licence, registration or other authorisation is required by law in any jurisdiction;
(b) has been issued a prohibition order under any Act administered by the MAS or has been prohibited from operating in any jurisdiction by any financial services regulatory authority;
(c) has been censured, disciplined, suspended or refused membership or registration by the MAS.

In relation to an Appointed Actuary or a Certifying Actuary:
(i) whether the actuary has satisfactory past performance or expertise indicating knowledge of the local life or general insurance market;
(ii) whether an Appointed Actuary is a Fellow of Singapore Actuarial Society (SAS);
(iii) whether a Certifying Actuary is a member of the SAS and is a Fellow of an association recognised by the International Actuarial Association.

The factors include, but are not limited to, whether the relevant person:
(a) is or has been unable to fulfil any of its or his financial obligations, whether in Singapore or elsewhere;
(b) has entered into a compromise or scheme of arrangement with its or his creditors or made an assignment for the benefit of its or his creditors, being a compromise or scheme of arrangement that is still in operation, whether in Singapore or elsewhere;
(c) is subject to a judgment debt which is unsatisfied, either in whole or in part, whether in Singapore or elsewhere.

Relying merely on the self-declaration by a proposed representative is an insufficient measure. The MAS expects the FIs to do the following to determine the individual’s fitness and propriety:
(a) Verify relevant documents from the proposed representative in support of his fit and proper declaration,
(b) Conduct independent due diligence checks to ensure that the proposed representative satisfies the fit and proper requirements.
(c) Maintain adequate documentation evidencing that it had conducted the relevant checks and assessment in relation to the provision of the fit and proper certification.

The MAS expects FIs to conduct rigorous and independent checks on the fitness and propriety of their representatives. The due diligence checks to be conducted by the FIs include the following areas:
(a) Probity checks on representative’s identity;
(b) Probity checks on representative’s past records;
(c) Probity checks on representative’s financial status;
(d) Not to furnish false or misleading documents or information

When the FI submits a notification to appoint an individual as its representative under RNF, it is required to provide the proposed representative’s:
(a) National Registration Identity Card [“NRIC”] number;
(b) Foreign Identification Number [“FIN”] if he is a foreigner with no NRIC; or
(c) passport number if he is a provisional representative who has neither a NRIC nor FIN.

A financial adviser should not disclose to any person any information that given by a client, unless:
(a) the information obtained from the client is given to the MAS or any other government agencies in accordance with any relevant law;
(b) the client has given his consent to the financial adviser to disclose the information.

A financial adviser should provide clients with adequate information about its business, including its business address and contact details. It should also disclose the types of financial advisory service that it is authorised to provide, including the type of investment products that it is allowed to give advice on or market to clients.

A financial adviser may be a product provider itself, such as a bank, fund management company or life insurance company. Under such circumstances, the financial adviser should not promote its services as being “independent”.

The Singapore entity should ensure that its foreign related corporation(s) meets the following criteria:
(a) it has maintained a track record of at least the past three years in the proposed financial advisory service;
(b) it possesses competence in the specific area of business that it is proposing to effect under the arrangement;
(c) it discharges its functions in an efficient, honest and fair manner;
(d) it maintains a good ranking10 in its home country.

For the purpose of these Guidelines, “high net worth individual” is an individual:
(a) who has a minimum of S$1 million of assets, or the equivalent in foreign currencies, in any or all of the following forms:
(i) bank deposits, including structured deposits;
(ii) capital markets products;
(iii) life policies;
(iv) other investment products as may be prescribed by the MAS;
(b) whose total net personal assets exceed S$2 million in value or the equivalent in foreign currencies;
(c) whose annual income is not less than S$300,000 or the equivalent in foreign currencies; or
(d) who is assessed by the applicant to have the potential to become a person as described in (a) above within a period of two years.

In assessing applications for exemption, the MAS will generally take into consideration the following:
(a) whether the clients served by the Unit are considered high net worth individuals for the purpose of these Guidelines;
(b) the track record and reputation of the applicant and its parent institution or major shareholders in providing services to high net worth individuals;
(c) the policies and procedures on client acceptance and risk profiling that the Unit has in place;
(d) the range of products and services offered by the Unit.

Execution activities” means any or all of the following activities:
(a) dealing in securities (other than collective investment schemes) quoted on a securities exchange, overseas securities exchange or recognised trading system provider;
(b) trading in futures contracts;
(c) foreign exchange trading;
(d) leveraged foreign exchange trading.

A dealer is not required to repeat such disclosure of conflict of interest each time that an execution-related advice is rendered under the following circumstances:
(a) the previous disclosure remains up-to-date, comprehensive and accurate; and
(b) it can reasonably expect the client to be fully aware of the previous disclosure. A dealer should take into account the following when considering whether a client may reasonably be expected to be fully aware of a previous disclosure:
(i) whether or not there is a long lapse of time between the previous disclosure and the current recommendation or advice; and
(ii) whether the client is reasonably likely to draw an inference that the previous disclosure no longer applies in the context of the current recommendation or advice.

Guideline No: FAA-G09 is issued pursuant to Section 64 of the FAA. These Guidelines apply to any licensed or exempt financial adviser or its representative, who advises on any structured deposit, except:
(a) where advice is given to an accredited investor, expert investor or institutional investor, as defined in Regulation 2(1) of the FAR;
(b) where advice is given to a high net worth individual as defined in the “Guidelines On Exemption For Specialised Units Serving High Net Worth Individuals” Under Section 100(2) of the FAA.
(c) where advice is given to any person outside Singapore who is:
(i) an individual and:
a) not a citizen of Singapore;
b) not a permanent resident of Singapore.