Instruction on the Receipt, Storage, and Issuance of Precious Metals in Commercial Banks of the Kyrgyz Republic

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Date Created: 2009-08-06

Approved by the Resolution of the Board of the National Bank of the Kyrgyz Republic No. 46/3 dated December 5, 2001

Instruction on the Receipt, Storage, and Issuance of Precious Metals in Commercial Banks of the Kyrgyz Republic

I. General Provisions

1.1. This Instruction establishes the minimum requirements for the receipt, storage, and issuance of precious metals in commercial banks of the Kyrgyz Republic, and is intended to assist banks in minimizing risks when conducting such activities.

1.2. The main rules for working with precious metals are:

• adherence to the "four-eyes" principle;
• storage of valuables under dual control;
• surprise audits of precious metals;
• end-of-day reconciliation of precious metal balances with accounting records.

1.3. Precious metals may be stored in a separate room or in the same room as cash. If precious metals are stored in a separate room from cash, the requirements for the equipment and characteristics of such a room must be at least equal to those for cash vaults.

1.4. If precious metals are stored in the same room as cash, they must be kept in safes separate from other valuables.

1.5. The room (vault) where precious metals are stored must be a restricted-access area, and movement within it must be limited. The list of persons granted access to such a room is formalized by a bank order.

1.6. The bank head, the manager responsible for organizing and conducting cash operations, and the manager responsible for organizing and conducting accounting are financially liable persons and bear responsibility for the safety of precious metals. The powers and responsibilities of the bank head may be delegated to another responsible official.

1.7. The movement of precious metals must be carried out with the involvement of at least three independent departments: those conducting cash operations, accounting, those authorizing transactions with precious metals, and the department responsible for security (hereinafter, the bank's security service).

II. Receipt of Precious Metals

2.1. The department authorizing transactions with precious metals, independently or through the bank's security service, prepares in advance the movement route and delivery time for precious metals. The Cash Collection Department or other authorized bodies may be involved.

2.2. The receipt of precious metals is carried out in accordance with the directives of the head of the department authorizing transactions with precious metals or another authorized body, as well as accompanying documents, and occurs in the presence of employees of the department authorizing transactions with precious metals.

2.3. Upon receipt of precious metals, cash operations department employees conduct an external inspection, weigh them, and verify the presence and correspondence of accompanying documents to the characteristics of the received valuables. For standard ingots, accompanying documents are a specification and a certificate, and for assay ingots, a specification, passport, and certificate.

2.4. After weighing the precious metals and verifying the accompanying documents in the presence of employees of the department authorizing transactions with precious metals, cash operations department staff, and delivery representatives, a receipt act is prepared.

2.5. The act specifies the quantity of precious metal ingots, their alloy and pure mass, fineness, the number of the accompanying letter, specification numbers, etc. The receipt act is prepared in four copies: one copy is given to the delivery representatives, and three copies remain with the bank (cash operations department; accounting department; department authorizing transactions with precious metals). All copies of the act are sealed with official seals. Based on the receipt act, the accounting department credits the precious metals to the bank's balance sheet.

2.6. Received ingots are packaged by cash operations department employees into special boxes, sealed by responsible executors and the head of the cash operations department, and tags are attached to them. The tag indicates the packaging date and all necessary details of the packaged metals, and is signed by responsible executors and the head of the cash operations department. The former are responsible for the contents, quantity, mass, and correctness of packaging. Packaged valuables are handed over for storage to three financially liable persons. If boxes (safes) are opened later during storage, the corresponding entry is made on the tags. Such entries are certified by the signatures of the persons who opened them, indicating the reason and time of opening.

2.7. In case of errors and discrepancies between document data and stamps on ingots discovered in the presence of all persons during the unloading of precious metals, a claim act is prepared, and the cargo is not accepted. The department authorizing transactions with precious metals takes measures to resolve discrepancies or return the cargo.

2.8. For each ingot arriving at the vault, the head of the cash operations department prepares a valuables accounting card on the day of its arrival. The valuables accounting card contains: type of metal, date of arrival and ingot number, packaging number, alloy and chemically pure mass of the ingot, certificate number, and other data regarding the arrival of the precious metal.

2.9. The ingot certificate is attached to the valuables accounting card, and they are stored together with the head of the cash operations department of the bank. Accounting cards are recorded in off-system accounting.

2.10. Received precious metals are also registered in a special journal (book) for precious metals accounting.

III. Storage of Precious Metals

3.1. Storage of precious metals in a separate room from cash.

3.1.1. Precious metals stored in a separate room from cash may be located in safes, cabinets, boxes, and containers, or stacked on wooden pallets. In all cases, measures are taken to prevent scratches and dents on stacked precious metals.

3.1.2. Safes and cabinets may be locked with one key and sealed with one seal. In this case, the keys and seal are kept by the head of the cash operations department.

3.1.3. If safes and cabinets are locked with more than one key, the first keys and seal are kept by the head of the cash operations department, and the others by other financially liable persons.

3.1.4. Opening and closing the vault with precious metals is conducted with the involvement of three financially liable persons. The room must be locked with at least two keys and sealed with at least two seals, and the keys/seals must be held by financially liable persons.

3.1.5. Rules for storing keys and seals for rooms and safes with precious metals are analogous to those applicable to keys and seals for cash vaults.

3.2. Storage of precious metals in the same room as cash.

3.2.1. Precious metals stored in the same room as cash must be placed in separate safes or cabinets. Before being stacked in safes or cabinets, ingots may be pre-packaged in boxes or containers. In all cases, measures are taken to prevent scratches and dents on stacked precious metals.

3.2.2. Safes and cabinets must be locked with at least two keys and sealed with at least two seals. Keys and seals are kept by financially liable persons and distributed among them, as in the case of cash storage.

IV. Issuance of Precious Metals

4.1. The cash operations department issues precious metals only based on directives from the department authorizing transactions with precious metals or another authorized body.

4.2. The directive for issuing precious metals specifies: the basis for issuance (client order, contract, agreement, etc.), the recipient's name, as well as the name and mass of valuables in corresponding units.

4.3. Precious metals are issued together with their individual certificates. For issued precious metals, the head of cash operations prepares specifications in three copies, which are attached to the issuance acts.

4.4. Specifications are signed by financially liable persons, and their correctness is verified and certified by the head of the accounting department.

4.5. The specification indicates the quantity, alloy mass, pure mass, fineness of precious metal ingots, and the specification numbers according to which the precious metals were received by the bank.

4.6. Prior to issuing precious metals, an employee and the head of the cash operations department, along with a representative of the cash collection service, verify the details of the ingots against the data in the specifications, carry out weighing, counting, and packaging of the precious metals.

4.7. With written permission from the head of the department authorizing transactions with precious metals, the participation of his subordinate and the recipient's representative in assembling, preparing, and issuing valuables is permitted.

4.8. Precious metals prepared for issuance are packaged in wooden boxes or metal containers. To prevent damage to precious metals, each box is filled with sawdust or other materials, with dense paper placed between ingots. Boxes are edged with metal bands and wrapped with wire. Subsequently, the bank head, head of the cash operations department, and representative of the cash collection service (or recipient's representative) seal the boxes or containers.

4.9. Each packaged box or container is attached with a tag indicating the recipient's address, alloy mass of precious metals, gross cargo mass, and cost per place. Tags are signed by the head of the cash operations department, responsible executor, and recipient's representative.

4.10. An issuance act is prepared for packaged valuables in four copies: the 1st is sent to the accounting department, the 2nd remains with the valuables, the 3rd is sent to the recipient, and the 4th is transferred to the department authorizing transactions with precious metals. The act is signed by the responsible executor, head of the cash operations department, and representative of the cash collection service (or recipient's representative), confirmed by the bank head, and sealed with an official seal.

4.11. The issuance act specifies the quantity, alloy and chemically pure mass of precious metal ingots, specification numbers, seal impressions, number and date of the order (contract), and names of the recipient or cash collection service.

4.12. Based on the issuance act, the removal of precious metals from the bank's balance sheet and certificates from off-system accounting is processed.

4.13. The head of the cash operations department makes corresponding entries in the valuables accounting cards and closes them. Cards for the last 12 months are kept by the head of the cash operations department, and then transferred to the archive.

4.14. Valuables issued from the vault are registered by the head of the cash operations department in a special journal (book) on the day of their removal.

Contacts

Public Reception +996 (312) 61-04-86 +996 (312) 66-90-15 +1257, +1256

Consumer Protection Department +996 (312) 66-90-15 +1671, +1666

Report Corruption +996 (312) 66-90-15 +2120 +996 (312) 61-04-00

Automated Information System for Official Exchange Rates +996 (312) 61-07-11

Numismatic Museum +996 (312) 66-90-15 +1232 +996 (312) 61-24-14

E-mail mail@nbkr.kg

Media Relations press@nbkr.kg

720010, Kyrgyz Republic, Bishkek, Kievskaya St., 189