4241. Pricing procedures

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    1. A Dealer Member must consistently and accurately price all securities. In Part C of Rule 4200, references to securities include client and inventory securities and securities used in financing transactions such as security borrow and lend, repurchase agreement transactions and reverse repurchase agreement transactions.

    2. On a daily basis, a Dealer Member must consistently and accurately mark to market its “owned” and “sold short” security positions to ensure accurate profit and loss reporting in accordance with IIROC requirements.

    3. A Dealer Member’s policies and procedures must specifically address consistently pricing securities and verifying prices of securities.

    4. A Dealer Member’s policies and procedures must specifically address appropriate pricing in security records that it uses to prepare management reports for monitoring:

      1. securities inventory profit and loss,

      2. its regulatory capital position, and

      3. security segregation.

    5. A Dealer Member must assign knowledgeable employees, who are independent of its trading functions, to prepare the reports in subsection 4241(4), and must supervise the reports’ preparation. Conflicted employees must not be involved in security pricing or, failing that, the Dealer Member must adopt compensating procedures to ensure appropriate pricing.

    There is no history log for this rule.