TRAction has identified a few common mistakes in ASIC trade reporting data. Ensuring the completeness and accuracy of your ASIC trade reporting is important so please take the time to review the below.
1. Only OTC derivatives trades need to be reported
For the purpose of ASIC trade reporting, you are only required to report trades in relation to OTC derivatives such as margin FX, options, forwards and CFDs. Hence, it’s important you only submit OTC derivatives-related trade data to your reporting delegate or trade repository.
Check your files to ensure you are excluding all of the following transactions:
- direct stocks and equities;
- direct cryptocurrency transactions (e.g. bitcoin trades which are not CFDs over bitcoin); and
- Exchange traded derivatives.
2. Only trades related to you (Australian entity) matter
You are only required to submit trades entered into between your Australian entity and:
- your clients/counterparties; and
- your hedging counterparties (unless single sided relief exemption applies).
If you have related offshore or overseas entities, please ensure you are not sending any trades relating to those entities (unless there is a hedging arrangement from the offshore entity to your ASIC entity in place which requires reporting to ASIC) to your reporting delegate or trade repository.
3. Reporting all trading platforms and systems
ASIC have issued fines to AMP and Westpac for not reporting large quantities of OTC derivatives transactions because they have forgotten about entire systems containing the information.
Check you are reporting trades from all of your platforms and systems. For example, have you added MetaTrader5 or another platform and forgotten to update your reporting delegate or systems?
4. Full visibility of your reportable trade accounts (only applicable to clients using MT4 API, MT4 & MT5 linked servers)
Ensure all the reportable trading platform accounts are visible to your reporting delegate or the team doing your ASIC OTC derivative trade reporting, especially if you use a grouping method to organise your trade accounts.
5. Check your handback files
If you haven’t been checking the handback or confirmation files received from your reporting delegate or trade repository, see the tips here on how you can do the cross-check.
With these simple tips, you’ll improve your reporting process. If you have any questions or would like to discuss further, please do not hesitate to contact us. If you want read more on ASIC trade reporting, click here.
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Angela works in our Sydney office. At TRAction, she provides regulatory support to our clients, monitors changes in the worldwide regulatory environment relating to trade and transaction reporting, assists with business development and client onboarding as well as development of PR and marketing strategies. Angela has several years of experience working in legal and compliance for financial services companies. She previously practiced in a leading boutique financial services law firm in Sydney as a solicitor with a focus on licensing, compliance, AML/CTF and M&A. Angela has a double degree in Actuarial Studies and Law from the Australian National University and is admitted as a solicitor in Australia.