Chapter 25

Due Diligence Guidelines –

Record Keeping

4. Documenting Expert Engagements

4.1 Standards

In respect of each listing assignment, a sponsor should keep records including relevant supporting documents and correspondence, within its control, relating to: … for due diligence procedures conducted by third parties, information relating to the matters in paragraph 17.6(g); [Paragraph 17.10(c)(iii) of the Code of Conduct]

4.2 Guidance

4.2.1 For guidance on complying with requirements on interaction with experts and third parties who provide assistance to the sponsor, please refer to Chapter 18 “Due Diligence Guidelines – Interaction with Third Parties including Expert Advisers” and Chapter 13 “Due Diligence Guidelines – Internal Controls”.

4.2.2 Records in relation to compliance with Paragraphs 17.6(g) and 17.7 of the Code of Conduct should be retained. In particular, the sponsor should keep a record of any expert’s engagement letter that sets out its scope of work (and if any, limitations to the scope of work), bases and assumptions adopted to perform the work, as well as the expert’s confirmation of independence.

4.2.3 If a material issue has been identified and it relates to the scope of work that a professional party has been engaged to undertake, or a material issue has been identified which requires the professional party to carry out additional work or more in-depth work, or a material issue has been identified for which the sponsor seeks assistance from a professional party, the sponsor’s work undertaken to understand the due diligence procedures that have been undertaken by the professional party for that work and the findings and results of such due diligence procedures should be recorded (for example, in detailed notes of the discussions with the professional party).