Coronavirus – FCA Expectations Regulatory reporting/Client Money

Relevance:        All firms.

Action required:    Ensure you plan to mitigate the risks arising from external audit, and accountancy support failures and cheque handling/banking issues.


It is acknowledged that these are unprecedented times and that there has been some relaxation of specific rules by the FCA. However, the regulator has also made it clear that it remains your responsibility to ensure compliance with certain key requirements.

Before we get into specifics, feedback suggests that some audit and accountancy firms seem ill equipped to work effectively in the current environment. Be clear, it is your responsibility to find an alternative provider if your auditor or accountant is unable to deliver what you need to remain compliant. You should therefore engage with your current providers now to ensure that they can deliver any audit or accountancy services in a timely manner. Neither you, nor they, can rely on a return to normal working practices anytime soon.

Regulatory Reporting

You may have seen headlines stating the FCA has extended regulatory reporting deadlines see https://www.fca.org.uk/firms/regulatory-reporting/changes-regulatory-reporting-30-june-2020

To be clear, this does not apply to your RMAR, submitted via Gabriel. Therefore, if you are reliant upon your accountant to assist with the return, you need to check now that they will be in a position to meet the reporting timescales. Additionally, if there are potential system/reporting issues internally, you need to plan to address these as required.

Although the administrative fee for late returns has been waived, until 30 June 2020 (for firms paying less than £10,000 in fees and levies, in 2020/2021) late submission of your return remains a breach of FCA rules and will ultimately lead to enforcement action.

CASS Compliance

The FCA pages on Client money and assets can be found at https://www.fca.org.uk/firms/client-assets-coronavirus

CASS audit reports:

•    The FCA expects these to be delivered on time – you therefore need to engage with your auditor to ensure that they will be in a position to enable compliance. Where a firm is unable to obtain an audit report from its current source, it is not an acceptable reason for a delay and an alternative audit firm should be contracted accordingly.

•    If an audit firm is not able to submit a particular CASS audit report to the FCA within the required 4-month deadline, it must still follow the ‘late reporting’ rules.

Handling cheques

•    Regardless of the current situation, it is your responsibility to ensure that client assets are protected (generally, cheques received are banked by the close of the following business day):
•    If your office is unmanned, have you made arrangements to have post redirected to one of your team for banking and recording (so that client’s money is protected and the client receives any documents or service that is dependent upon payment)?
•    The guidance encourages firms to enable direct payment into its client account, whenever possible, if cheque handling is an issue.


Further newsletters are to follow.