Incorrect pricing

26. The Fund Manager should record each instance where the Unit price is incorrect and, as soon as the error is discovered, report the fact to the Persons providing oversight functions together with details of the action taken, or to be taken, to avoid repetition.
27. The Fund Manager and the Persons providing the oversight function should, if they become aware, report material instances of incorrect pricing to the Regulator as provided in the Rules. Materiality should be determined by taking into account a number of factors, including whether the Fund Manager has followed the pricing controls set out in this guidance.
28. The significance of any breakdown in management controls or other checking procedures should also be taken into account. The significance of any failure of systems should be considered. This may include situations where inadequate back-up arrangements exist. The duration of an error should also be taken into account; the longer an error persists, the more likely that it will have a material effect on a price.
29. The level of compensation paid to Unitholders, and the Fund Manager's ability (or otherwise) to meet claims for compensation in full, may also be relevant.
30. The Fund Manager should also report to the Regulator forthwith any instance of incorrect pricing where the error is greater than 0.5% of the price of a Unit, but where the Fund Manager and the Persons providing the oversight function believe that compensation is inappropriate and should not be paid by the Fund Manager.
31. The Trustee or the Persons providing oversight functions, in their reports, should summarise the number of instances of incorrect pricing during a particular period. This should include the number of errors which were greater than 0.5% of the price of a Unit and the number of errors which were less than 0.5% of the price of a Unit where the Trustee or the Persons providing the oversight function did not consider the Fund Manager's controls to be adequate.