Independent Singapore VCC guidance
Direct answer
Grant temporary trading authority only for a defined VCC mandate, trigger, period, instrument scope and decision role. Confirm that the substitute is competent, free of unmanaged conflicts and supported by current portfolio, limit and open-order information. Give only the access needed, notify relevant control functions and counterparties through approved routes, and set automatic expiry wherever possible. The original owner or accountable manager should review material actions after return. Revoke access promptly and retain the approval, handover, activity and closure evidence together.
At a glance
- Separate temporary coverage for investment decisions, order placement, approval and operational release.
- Use a narrower mandate and shorter duration when information or competence is incomplete.
- Handover open orders, pending corporate actions, limits and unresolved breaches before authority starts.
- Revoke systems and external permissions, then review activity against the approved scope.
Who this is for
- A fund manager arranging temporary coverage for a portfolio manager, trader or authorised decision-maker supporting a VCC mandate.
Important exclusions
- A permanent delegation, unrecorded password sharing, or authority that conflicts with the governing mandate, employment terms or regulatory permissions.
Decide whether temporary authority is the right response
Start with the operating need: planned leave, sudden illness, vacancy, system-location issue or another disruption. Determine whether the mandate actually needs trading during the gap. A restricted monitoring period, delayed non-urgent decisions or use of an existing approved backup may be safer than creating new authority. Identify which roles are missing and avoid combining investment decision, order entry, approval and settlement release merely for convenience. The VCC has an appointed fund manager and defined governance structure, so the coverage decision should remain within the manager operating model and the applicable mandate. Record why temporary authority is necessary, alternatives considered, affected sub-funds and the event that will end or reconsider the arrangement.
Sources: Monetary Authority of Singapore · Monetary Authority of Singapore · Accounting and Corporate Regulatory AuthorityCoverage decision
- Existing approved backup is readyActivate the documented backup after confirming current competence, availability, access and mandate information.
- Coverage can remain restrictedLimit activity to monitoring, risk reduction or specifically approved actions while deferring discretionary trading.
- New substitute is neededPerform the full competence, conflict, authority, access and handover assessment before activation.
- Safe coverage cannot be establishedEscalate the mandate limitation and use the approved contingency rather than creating informal trading authority.
Related guidance: VCC fund-manager key-person readiness test
Define the authority and hard boundaries
Write the authority at the level a control function and broker can apply. Identify the VCC, sub-funds, accounts, strategies, instruments, markets, order types, size limits, risk-reduction permissions and prohibited actions. State whether the substitute may make investment decisions, place approved orders, amend orders or only communicate instructions created by another authorised person. Record the start, expiry, review trigger and named approver. Avoid wording such as full coverage or normal duties when the arrangement is meant to be temporary. If external records or mandates require an update, complete the approved change route before relying on the authority. Any exception should return to the accountable manager instead of being decided through an informal message.
Sources: Monetary Authority of Singapore · Monetary Authority of Singapore · Accounting and Corporate Regulatory Authority| Field | Decision | Control evidence |
|---|---|---|
| Mandate | Named VCC, sub-funds, accounts and strategies | Current mandate and account map |
| Activity | Decision, order placement, amendment or monitoring | Role and segregation record |
| Limits | Instrument, market, size and risk boundaries | Configured and documented thresholds |
| Duration | Start, expiry and early termination event | Time-bound approval and access |
| Exception | Person who can approve action outside scope | Escalation route and separate record |
Check competence, conflicts and current information
Confirm that the substitute understands the strategy, instruments, markets, counterparties, dealing procedure, risk limits and escalation route relevant to the approved scope. General seniority does not prove current competence for a specialised mandate. Review personal dealing, outside interests, remuneration incentives, related parties and any relationship with counterparties or portfolio companies. Provide current positions, cash, limits, liquidity, open orders, recent decisions, pending corporate actions, valuation concerns and unresolved incidents. Ask the substitute to explain the first-day priorities and how an unclear instruction will be handled. Where gaps remain, narrow the authority, add supervision or choose another contingency. Preserve the assessment and any conditions rather than relying on an oral assurance.
Sources: Monetary Authority of Singapore · Monetary Authority of SingaporeReadiness checks
- Experience and training match the instruments, markets and decisions included in the temporary scope.
- Conflicts, personal dealing and outside interests are reviewed for the affected mandate and counterparties.
- Current positions, cash, limits, open orders, events, incidents and restrictions are handed over and acknowledged.
- The substitute can identify escalation contacts for investment, risk, compliance, operations and technology issues.
- Any competence or information gap produces a documented restriction, supervision step or different coverage decision.
Related guidance: VCC representative onboarding process
Activate access and external recognition safely
Translate the approved role into named access without sharing credentials. Grant only the order, portfolio, research and communication permissions needed, and preserve normal maker-checker separation. Use start and expiry controls, monitor privileged or unusual activity and test the substitute login before the coverage window. Notify brokers, custodians, administrators or other parties only where they need to recognise the temporary role, using verified contacts and approved authority evidence. Confirm which communication channels create valid dealing instructions. The internal approval, system entitlement and counterparty record should agree before activity begins. A person who can log in but is not recognised externally, or is externally recognised without the right internal controls, creates a dangerous split.
Sources: Monetary Authority of Singapore · Monetary Authority of Singapore · Monetary Authority of SingaporeActivation sequence
- ApproveComplete the bounded authority, readiness assessment, conditions, start, expiry and accountable senior-manager acceptance.
- ProvisionCreate named, least-privilege access with appropriate segregation, monitoring and automatic expiry wherever supported.
- NotifyUpdate control functions and necessary counterparties through verified channels using consistent authority evidence.
- TestConfirm login, data visibility, permitted actions, rejection boundaries and communication routes before live activity.
- ActivateBegin coverage only after the handover is acknowledged and all material mismatches are resolved or restricted.
Related guidance: VCC investment decision communication records
Monitor, hand back and revoke completely
During the coverage period, review activity against the temporary scope, especially overrides, new instruments, unusual sizes, rejected orders and out-of-hours actions. Keep the substitute informed of changing positions, restrictions and events. At handback, reconcile open orders, completed trades, pending settlements, unresolved alerts and decisions awaiting review. The returning owner or accountable manager should review material actions and confirm any follow-up, without retrospectively erasing a valid temporary decision. Revoke system access, broker recognition, distribution lists and temporary approvals at the agreed end or earlier trigger. Check that expiry worked and that no standing permission survived. Retain the approval, readiness assessment, handover, access evidence, activity review and closure as one retrievable file.
Sources: Monetary Authority of Singapore · Monetary Authority of Singapore · Monetary Authority of SingaporeAuthority lifecycle
- TriggerRecord the coverage need, expected duration, alternatives and affected VCC mandates before choosing temporary authority.
- ActivateAlign approval, competence, handover, internal access and external recognition before the substitute performs live activity.
- MonitorReview actions, exceptions, risk changes and information updates against the narrower temporary scope.
- Hand backReconcile open work and explain material decisions, incidents, exceptions and pending follow-up to the returning owner.
- RevokeRemove every temporary permission, verify closure and retain the complete evidence file for later challenge.
Related guidance: VCC mandate team-member offboarding controls
Frequently asked questions
Can a colleague cover trading without a written approval?
Urgency does not make informal authority safe. Use the quickest approved contingency route, but record the mandate, activity, limits, duration, approver and access. If those elements cannot be established, restrict activity and escalate rather than relying on a message or shared credential.
Should temporary authority copy the absent person exactly?
Usually not by default. The substitute may have different competence, conflicts, information or supervision. Define the minimum scope needed for continuity and narrow instruments, size, discretion or duration where appropriate. Broader authority needs stronger evidence, not simply the same job title.
May the substitute use the absent trader account?
No. Use named access that attributes actions to the actual person and preserves monitoring, approval and expiry. Shared credentials weaken accountability and make investigation difficult. If a system cannot support controlled named access, use the approved contingency rather than disguising the operator.
What should be included in the handover?
Include current positions, cash, risk limits, open and planned orders, recent decisions, pending corporate actions, settlement issues, valuation concerns, restricted items, incidents and key contacts. The substitute should acknowledge the record and raise missing information before live authority starts.
How is temporary authority closed?
Reconcile open work, review material activity, remove internal and external permissions, verify that time-based expiry operated and record follow-up. Closure should show that no residual account, broker recognition, mailing list or standing approval continues beyond the authorised period.
Official sources and further reading
- Risk Management Practices for Fund Management Companies (Monetary Authority of Singapore)
- Technology Risk Management Guidelines (Monetary Authority of Singapore)
- Guidelines on Individual Accountability and Conduct (Monetary Authority of Singapore)
- Understanding VCC Features, Eligibility and Requirements (Accounting and Corporate Regulatory Authority)
Discuss a Singapore VCC structure
For help coordinating a Singapore VCC setup or corporate administration, contact Raffles Corporate Services.
General information only. This article is not legal, tax, regulatory or investment advice and does not imply affiliation with or endorsement by ACRA, MAS or IRAS.