PRU 3.7.3

(1) For the purposes of Rule 3.7.2, an Authorised Person must calculate its relevant Annual Audited Expenditure with reference to the Authorised Person's most recent audited financial statements.
(2) If the Authorised Person's most recent audited financial statements do not represent a twelve-month accounting period, it must calculate its Annual Audited Expenditure on a pro rata basis so as to produce an equivalent annual amount.
(3) If an Authorised Person has not completed its first twelve months of business operations, it must calculate its Annual Audited Expenditure based on forecast expenditure as reflected in the budget for the first twelve months of business operations, as submitted with its application for authorisation.
(4) (a) If an Authorised Person:
(i) has a material change in its expenditure (whether up or down); or
(ii) has varied its authorised activities,
it must recalculate its Annual Audited Expenditure and Expenditure Based Capital Minimum accordingly.
     (b) Where an Authorised Person has recalculated its Annual Audited Expenditure and Expenditure Based Capital Minimum in accordance with (a), it must submit this recalculation to the Regulator within seven days of its completion and seek agreement/approval from the Regulator. The Regulator may within thirty days of receiving the recalculation object to the recalculation and require the Authorised Person to revise its Expenditure Based Capital Minimum.