THE RESOLUTION OF BOARD OF THE AGENCY OF THE REPUBLIC OF KAZAKHSTAN ON REGULATION AND DEVELOPMENT OF THE FINANCIAL MARKET

of September 12, 2022 No. 63

About approval of requirements to risk management system and internal control in joint-stock company "Fund of guaranteeing insurance payments

According to subitem 10-6) of Item 1 of article 4 of the Law of the Republic of Kazakhstan "About Fund of guaranteeing insurance payments" Board of the Agency of the Republic of Kazakhstan on regulation and development of the DECIDES: financial market

1. Approve the enclosed Requirements to risk management system and internal control in "Fund of Guaranteeing Insurance Payments" joint-stock company (further – Requirements) according to appendix to this Resolution.

2. To provide to department of the insurance market and actuarial calculations in the procedure established by the legislation of the Republic of Kazakhstan:

1) together with Legal department state registration of this resolution in the Ministry of Justice of the Republic of Kazakhstan;

2) placement of this resolution on official Internet resource of the Agency of the Republic of Kazakhstan on regulation and development of the financial market after its official publication;

3) within ten working days after state registration of this resolution submission to Legal department of data on execution of the action provided by the subitem 2) of this Item.

3. To impose control of execution of this resolution on the supervising vice-chairman of the Agency of the Republic of Kazakhstan on regulation and development of the financial market.

4. This resolution becomes effective after ten calendar days after day of its first official publication, except for the subitem 6) of Item 17 of Requirements which becomes effective since July 1, 2023.

Appendix

to the Resolution of Board of the Agency of the Republic of Kazakhstan on regulation and development of the financial market of September 12, 2022 No. 63

Requirements to risk management system and internal control in "Fund of Guaranteeing Insurance Payments" joint-stock company

Chapter 1. General provisions

1. These requirements to risk management system and internal control in "Fund of Guaranteeing Insurance Payments" joint-stock company (further - Requirements) are developed according to the Law of the Republic of Kazakhstan "About Fund of guaranteeing insurance payments" (further – the Law) and determine procedure for forming of risk management system and internal control of Fund of guaranteeing insurance payments (further - Fund).

2. In Requirements the following concepts are used:

1) the management reporting - the instrument of internal control and assessment of activities of Fund;

2) guaranteeing reserves - indemnification reserve, reserve of guaranteeing insurance payments for industry "general insurance" and reserve of guaranteeing insurance payments for industry "life insurance", according to the Law of the Republic of Kazakhstan "About Fund of guaranteeing insurance payments";

3) komplayens-culture - culture of observance by Fund and its workers of requirements of the civil, tax, insurance legislation of the Republic of Kazakhstan, the legislation of the Republic of Kazakhstan on Fonda, on state regulation, control and supervision of the financial market and the financial organizations, about financial accounting and the financial reporting, about joint-stock companies, and also internal documents of Fund;

4) komplayens-risk - probability of emergence of losses owing to non-compliance by Fund and its workers of requirements of the civil, tax, insurance legislation of the Republic of Kazakhstan, the legislation of the Republic of Kazakhstan on Fonda, on state regulation, control and supervision of the financial market and the financial organizations, about financial accounting and the financial reporting, about joint-stock companies, and also internal documents of Fund;

5) corporate management - set of the processes which are providing management of activities of Fund, including the relations between shareholders, the board of directors, executive body, and other bodies of Fund for the benefit of shareholders.

The corporate management system allows to organize distribution of powers and responsibility in Fund, and also to construct corporate decision making process;

6) limitation - establishment of high-quality and quantitative restrictions of the accepted risks, establishment of restrictions for transactions (transactions) of Fund.

In case of limitation the following parameters are determined:

indicator on which the limit is set;

method of measure calculation on which the limit is set;

limiting (maximum, minimum) measure value;

7) conflict of interest - contradiction between private interests of the worker (official) of Fund and its ex-officio full powers under which private interests of the worker (official) of Fund can lead to non-execution or improper execution of the ex-officio full powers by it;

8) stress tests - methods of measurement of potential influence on financial position of Fund and safety of means of reserves of guaranteeing, exclusive, but possible events which can exert impact on activities of Fund;

9) risk - possibility of emergence of the circumstances causing uncertainty or impossibility of receipt of the expected results of activities of Fund, emergence of expenses (losses) on own assets and reserves of guaranteeing;

10) system of risks assessment - set of the coefficients intended for complex financial analysis of Fund and safety of means of reserves of guaranteeing;

11) division on risk management - the structural division of Fund performing functions on monitoring, providing and tracking of risks, implementation of effective management practice with risks and internal control;

Disclaimer! This text was translated by AI translator and is not a valid juridical document. No warranty. No claim. More info