4140 NEW ZEALAND GAZETTE No. 156

(a) the right to practise stockbroking as a member;

(b) the right to hold any position or office which must be held by a member, whether in his member firm or in the Exchange;

(c) the right to vote at any meeting of members; and

(d) the right to hold himself out to the public as a member. Suspension shall not, however, excuse a member from meeting any of his or its obligations to the Exchange, including the obligation to pay all fees and levies as they fall due.

21.7 Loss of membership: A person shall cease to be a member:

(a) In the case of an individual member, if he:

(i) has not represented a member firm full time for a total of six months out of the last 12 months, unless granted leave of absence by the Board. Such leave of absence by an individual associate member or an individual full member must be applied for in writing to the Board prior to the expiry of the relevant 12 month period; or

(ii) makes a false declaration to the Exchange when applying for membership,

but in each case, such termination shall not release the member from any outstanding obligations owed by him to the Exchange at that time; or

(b) If he has delivered his resignation in writing to the Board and the Board has accepted the same. The Board shall not withhold its acceptance without good reason. Good reason shall include, for example, if the member has not settled all outstanding fees and levies owed to the Exchange and any other expenses incurred in respect of that individual full member by the Exchange; or

(c) On termination of membership by the Board (which may be without further notice to the member):

(i) in the case of an individual full member suspended under Rule 21.2 if in the opinion of the Board, the member does not provide satisfactory evidence of his on-going commitment to meet the obligations set out in Rule 21.2; or

(ii) if any of the events listed in Rule 5.1(b)(i) to (vi) occurs after the date the person became an individual member and the Board in its complete discretion decides to terminate the member’s membership; or

(iii) under the powers provided in Rule 10.22(c); or

(d) pursuant to expulsion by the Disciplinary Committee or by the Board pursuant to Rule 18.10; or

(e) If he fails to pay any fees, levies or other charges set by the Board which are due and payable as a condition of membership.

21.8 Conditions for re-eligibility for membership: Any individual full member who has his membership terminated in terms of Rule 21.7(a) or Rule 21.7(c)(i) without having met any obligations imposed under Rule 21.2 or without having paid all outstanding fees, levies and other expenses, shall not be eligible to subsequently apply for readmission to membership until all such obligations have been discharged to the satisfaction of the Board.

21.9 Evidence: For the purposes of Rule 21.7(e)(ii), proof of the occurrence of any of the matters listed in Rule 5(b)(i) to (vi) in relation to an individual member may be given by a certificate containing evidence of the matter and purporting to be signed by, in the case of a conviction, the Registrar or other proper officer of any Court by which the individual member was convicted and in any other case, by an appropriate person who has knowledge of the matter concerned.

22. Members’ accounts, audit and supply of information

22.1 Accounts and records: Every member firm shall keep books of account and records containing complete and correct records and explanations of the affairs and transactions of its stockbroking business. The books, records and explanations shall be kept separate and distinct from the books and other records of any other business in which the member firm may be involved, and shall be in such form as the Board shall from time to time determine. They must be sufficient to enable an auditor to supply the certificate of audit and report as required by Rule 22.2.

22.2 Audit certificate and report: When notified by the Board, a member firm shall, within the time specified in such notification, supply to the Chairman a certificate of audit and report from a practising chartered accountant who, failing appointment by mutual consent between the member firm and the Board, may be appointed by the Board at the expense of the member firm. The certificate and report shall deal with such financial matters as the Board shall from time to time determine.

22.3 Inspection of records: The Board shall have full and absolute power at any time to call upon any member firm to produce promptly, for inspection by the Board or its duly appointed representatives, all books, letters, telegrams or copies thereof, and other documents relating to its business as a stockbroker. The Board may also require members and their clerks to appear before the Board or its duly appointed representatives at any time, and to give such information as may be required in connection with such business.

22.4 Financial statements: Every member firm shall provide copies of its latest financial statements to the Inspector immediately following completion of such financial statements.

23. Inspector of the Exchange

23.1 Board to appoint inspector: The Board shall appoint either an individual or an appropriate firm, neither of whom shall be a member of the Exchange, to be or to provide appropriate personnel to carry out the duties of the inspector of the Exchange (the “Inspector”). Any individual or firm so appointed shall be a chartered accountant, or a firm of chartered accountants, in public practice. The Board may, at its sole discretion, appoint an alternate Inspector (who shall be a chartered accountant or firm of chartered accountants, in public practice and not a member of the Exchange) if for any substantial reason it considers this necessary.

(a) Each Inspector or alternate Inspector shall be directly responsible for work carried out by him under the provisions of these Rules.

(b) Neither the Inspector nor the alternate Inspector (if any) nor any member of their firm shall take any part in the accounting work involved with the day to day recording of stockbroking transactions for a member firm. Provided the principle of independence of the Inspector remains paramount, an Inspector may undertake for a member firm such accounting work as the preparation of annual accounts from a trial balance supplied by the member firm, preparing and lodging tax returns, or offering advice to the member firm on improving its accounting methods or its office procedures.

23.2 Powers of inspector: The Inspector is empowered to inspect the financial records and related documents of each member firm at any time he considers necessary, and to require from any member firm an explanation of any item or state of affairs whatsoever in relation to the member