Article 15-3. The general procedure for organizing and conducting an audit based on a risk assessment and an unscheduled review of the Law on State Regulation, Control and Supervision of the Financial Market and Financial Organizations

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Article 15-3. The general procedure for organizing and conducting an audit based on a risk assessment and an unscheduled review of the Law on State Regulation, Control and Supervision of the Financial Market and Financial Organizations

1. An inspection based on a risk assessment and an unscheduled inspection are carried out within the competence of the control and supervision body on the basis of an inspection appointment act approved by the deputy head of the control and supervision body, heads of territorial divisions of the control and supervision body or other authorized officials on the basis of a relevant order.

In cases of appointment of an inspection based on a risk assessment or an unscheduled inspection, acts on appointment of an inspection are recorded in the journal of registration of acts on appointment of an inspection. The divisions of the control and supervision bodies within their competence maintain separate logs of registration of inspection appointment acts.

The control and supervision body, within its competence, registers the act on the appointment of an audit with the authorized body for legal statistics and special accounting no later than two working days after the start of the audit.

The act on the appointment of the inspection shall specify:

1) the number and date of the act;

2) the surname, initials and position of the inspection staff, as well as the persons entrusted with the management of the inspection;

3) the name of the audited entity, in respect of which the audit is scheduled, and its location;

4) type of verification;

5) Issues to be reviewed;

6) the deadline for the audit;

7) the period under review.

2. The date of delivery of a copy of the inspection appointment act to the head (his deputy) of the inspected entity is considered to be the beginning of an inspection based on a risk assessment, an unscheduled inspection. After handing over to the audited entity a copy of the inspection appointment act, a note on receipt and familiarization with the inspection appointment act is placed on its original.

In case of refusal to adopt an act on the appointment of an inspection or obstruction of access of officials of the control and supervision body carrying out the inspection to the materials necessary for conducting the inspection, an appropriate act is drawn up, which is signed by an official of the control and supervision body carrying out the inspection. If an employee of the audited entity refuses to accept an act on the appointment of an audit, a corresponding entry is made in it. Refusal to receive an inspection appointment certificate is not a reason for canceling the inspection. In cases of refusal of the audited entity to provide documents and information within the time limits specified in the requests of the verification group, failure to comply with the conditions of this article, which led to the impossibility of conducting an audit within the established time frame, the audit is considered to have failed by decision of the head of the audit in coordination with the official authorized to approve the act on the appointment of an audit.

When handing over a copy of the inspection appointment act to an employee of the audited entity or its founder (one of the founders), a copy of the inspection appointment act with a note of receipt by its head (his deputy) of the audited entity must be submitted to the officials of the control and supervision body within two working days from the date of delivery of the inspection appointment act.

If it is impossible to hand over a copy of the inspection appointment act to an employee of the audited entity or its founder (one of the founders) it is sent by registered mail with a notification at the place of registration of the audited entity and (or) its head (his deputy). If the letter is returned and it is impossible to hand over the certificate of appointment of the inspection within the time limits set for its conduct, the inspection is considered to have failed. In this case, the head of the audit notifies in writing the official authorized to approve the act on the appointment of the audit.

3. The audited entity, no later than the next day after the start of the audit, submits a letter addressed to the head of the audit or the verifying employee of the control and supervision body, containing information on:

1) the head responsible for ensuring the conduct of the audit, as well as for reviewing and signing the act of completion of the audit, the interim act and (or) the act on the results of the audit, and the person replacing him;

2) specialists of the audited entity responsible for the preparation of the necessary documents (information), their timely transmission to the inspection staff and (or) receipt of interim reports from the inspection staff.

4. The deadline for conducting an inspection based on a risk assessment, an unscheduled inspection should not exceed thirty working days. Due to the significant volume of the audit, the deadline for conducting an audit based on a risk assessment, an unscheduled audit may be extended on the basis of an additional act on the extension of the audit, approved by the deputy head of the control and supervision body, heads of territorial divisions of the control and supervision body or other authorized officials on the basis of an appropriate order, only once for a period of no more than thirty working days, and in respect of a bank, a branch of a non-resident bank of the Republic of Kazakhstan classified as a bank, branches of non-resident banks of the Republic of Kazakhstan with an unstable financial situation that threatens the interests of its depositors and creditors and (or) threatens the stability of the financial system, or classified as insolvent banks, branches of non-resident banks of the Republic of Kazakhstan, for a period of more than thirty working days.

5. The audited entity is obliged to provide the inspection staff with permission to enter its administrative buildings (including on holidays and weekends), a separate office space equipped with office equipment and long-distance communications, and provide access to information related to the activities of the audited entity, including automated systems and databases in real time without the possibility of correction of data (in the viewing mode with the possibility of displaying data on paper), provide the inspection staff with the opportunity to make copies of the necessary documents, including in electronic form, as well as provide explanations (oral and written) to the questions of the inspection staff and assist the inspection staff in completing the inspection in a timely manner.

The requirements of the first part of this paragraph regarding the obligation to provide a separate office space equipped with office equipment and long-distance communication do not apply to the audited entities that are small business entities.

6. The inspection staff sends written requests to the head of the inspected entity, the head responsible for ensuring the inspection, or another authorized employee of the inspected entity, which are subject to execution within the specified time frame.

The subject under review is obliged to provide all necessary information and documents, including copies thereof, on the day of receipt of the request from the inspection staff or within the time limits specified in the request, in order to attach them to the inspection materials.

7. When replacing an inspection worker (changing the composition of the inspection group), an additional act is drawn up, which indicates the number and date of the previously drawn up act on the appointment of an inspection and the grounds for replacing the inspection worker (changing the composition of the inspection group).

8. The date of completion of the inspection based on the assessment of the degree of risk, an unscheduled inspection is considered to be the date of delivery of the inspection completion certificate to the audited entity. An act on the completion of an inspection based on a risk assessment, an unscheduled inspection is signed by the head of the inspection and his immediate supervisor and handed over to the audited entity no later than the end of the inspection period specified in the act on the appointment of the inspection.

The Law of the Republic of Kazakhstan dated July 4, 2003 No. 474-II.

This Law regulates public relations related to the implementation of state regulation, control and supervision of the financial market and financial organizations, and is aimed at increasing the stability of the financial system of the Republic of Kazakhstan and creating conditions to prevent violations of the rights and legitimate interests of consumers of financial services.

President

Republic of Kazakhstan

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