Can ASIC reconcile our client money on trust with the collateral figures from reported trades?

November 10, 2015

No. Due to an anomaly in the legislation, brokers with retail clients or clients that are not Reporting Entities don’t have to report how much collateral was posted by the client. Brokers only have to report the collateral that they post for trades, i.e. hedging trades. Again, single-sided relief may apply to your hedging trades meaning the collateral you have posted with your hedging counterparty doesn’t get reported to any trade repository. Similarly it is not possible for ASIC to know from the reported trades whether you have posted client money (under the Corporations Act provisions allowing you to do so) or firm capital with your hedging counterparties.