[Code of Federal Regulations]
[Title 17, Volume 1]
[Revised as of April 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 17CFR1.18]

[Page 62-63]
 
              TITLE 17--COMMODITY AND SECURITIES EXCHANGES
 
             CHAPTER I--COMMODITY FUTURES TRADING COMMISSION
 
PART 1_GENERAL REGULATIONS UNDER THE COMMODITY EXCHANGE ACT--Table of Contents
 
Sec.  1.18  Records for and relating to financial reporting and monthly 

computation by futures commission merchants and introducing brokers.

    (a) No person shall be registered as a futures commission merchant 
or as an introducing broker under the Act unless, commencing on the date 
his application for such registration is filed, he prepares and keeps 
current ledgers or other similar records which show or summarize, with 
appropriate references to supporting documents, each

[[Page 63]]

transaction affecting his asset, liability, income, expense and capital 
accounts, and in which (except as otherwise permitted in writing by the 
Commission) all his asset, liability and capital accounts are classified 
into either the account classification subdivisions specified on Form 1-
FR-FCM or Form 1-FR-IB, respectively, or, if such person is registered 
with the Securities and Exchange Commission as a securities broker or 
dealer and he files (in accordance with Sec.  1.10(h)) a copy of his 
Financial and Operational Combined Uniform Single Report under the 
Securities Exchange Act of 1934, Part II, Part IIA, or Part II CSE 
(FOCUS report) in lieu of Form 1-FR-FCM or Form 1-FR-IB, the account 
classification subdivisions specified on such FOCUS report, or 
categories that are in accord with generally accepted accounting 
principles. Each person so registered shall prepare and keep current 
such records.
    (b)(1) Each applicant or registrant must make and keep as a record 
in accordance with Sec.  1.31 formal computations of its adjusted net 
capital and of its minimum financial requirements pursuant to Sec.  1.17 
or the requirements of the designated self-regulatory organization to 
which it is subject as of the close of business each month. Such 
computations must be completed and made available for inspection by any 
representative of the National Futures Association, in the case of an 
applicant, or of the Commission or designated self-regulatory 
organization, if any, in the case of a registrant, within 17 business 
days after the date for which the computations are made, commencing the 
first month end after the date the application for registration is 
filed.
    (2) An applicant or registrant that has filed a monthly Form 1-FR or 
Statement of Financial and Operational Combined Uniform Single Report 
under the Securities Exchange Act of 1934, Part II, Part IIA, or Part II 
CSE (FOCUS report) in accordance with the requirements of Sec.  1.10(b) 
will be deemed to have satisfied the requirements of paragraph (b)(1) of 
this section for such month.
    (c) The provisions of this section do not apply to an introducing 
broker which is operating pursuant to a guarantee agreement, nor do such 
provisions apply to an applicant for registration as an introducing 
broker who files concurrently with such application a guarantee 
agreement, provided such introducing broker or applicant therefor is not 
also a securities broker or dealer.

[48 FR 35288, Aug. 3, 1983, as amended at 49 FR 39530, Oct. 9, 1984; 62 
FR 4641, Jan. 31, 1997; 69 FR 49800, Aug. 12, 2004; 71 FR 5594, Feb. 2, 
2006]

                 Prohibited Trading in Commodity Options