Israel Securities Authority Israel Securities Authority

MAGNA –Electronic filingMAGNA –Electronic filing

Natan Herscovitz, CIO

December 2004

Internet site: www.isa.gov.il

Enforcement system: investigations and intelligence

Stock Exchange activity monitoring

GroupWare system

Electronic filing system

Main computerization projects

Establish a computerized system to receive and distribute, via the Internet, all reports required from the bodies supervised by the Securities Authority.

Main goal: to enhance investors’ confidence and encourage capital market investments

Electronic Filing Project

Prompt report publication, free of delays

Equal publication: information is accessible to the general public

The electronic report is the legally original document, not only a representation

Establish an archive system that stores documents indefinitely

Enable complete data retrieval according to a large variety of criteria

Enable queries and reports – a unique, sophisticated feature

Filing System Goals

Receive non-public reports for internal ISA use

Fully automatic distribution to Tel- Aviv Stock Exchange and various commercial information distributors

Uniform and standardized reporting

Very significant cost reduction for companies

Filing System Goals

ArchitectureReporting

bodiesPublicStock

Exchange

Reporting Site

Electronic filing Information

System(MAGNA)

Distribution Site

Securities Authority

Information Systems

Document Management

SystemGroupWare

FormsReports

DocsData DocsData

Data

Docs

Received

Docs

Docs DataData

Security

Large amount of data:

General project characteristics

financial reports

immediate reports

transactions with

controlling shareholders

private placements

acquisitions

Forms for companies, investment advisors and portfolio managers

In total, hundreds of thousands of report pages per year

private placements

Prospectuses

Change of holdings

Tender offers

Thousands of reporting bodies, throughout Israel, with several persons in each appointed to fill reports

Short schedule: approximately one year to set up the system from kickoff to full production

Extensive integration and tutoring project

Service offices for assistance in reporting

Help Desk providing user support by phone

General project characteristics

Some of the world’s most advanced technologies, never used in any computer system before

Complex interfaces to internal and external systems

Advanced procedures:Individually tailored report forms:

reporting body identification and data downloads

Report type identificationReport fields IdentificationSent reports are encoded and signedCompleteness testingService offices

Project Characteristics — Software Development

Availability and reliability:99.95% up timeNo Single Point Of Failure

Computer room organization

DRP: Disaster Recovery PlanAlternative site in case of crash or

disaster, located in another city

Unique control & management system for hardware, software and business process control

Project Characteristics — Hardware and Communications

System must provide:IdentificationAuthenticationNon-RepudiationNon-DisclosureProtection against intrusionProtection from viruses and vandalsProtection of internal ISA information

systemsInterface protection

Project Characteristics —Required Data Security

Solutions used to achieve the above requirements:

PKI (Public Key Infrastructure) TechnologiesUse of external and independent Certification

Authority, approved by lawUse of USB Token as a cryptographic deviceUse of GAP technology for physical

separation as part of the PKI authentication process, including content inspection

Software securityFirewalls by various vendors Intrusion detection packagesAnti-Virus softwareSecurity control and management system

Project Characteristics — Data Security solutions

Getting underwayRegistration

Integration

Fully operational since Nov. 16th 2003

Further stages:Funds and investment counsel

Red flags

Electronic Filing Project