The Financial Conduct Authority has confirmed changes to ‘section K’ of the retail mediation activities return will take effect from the end of the year, including moving to an annual reporting structure.
In March the regulator launched a consultation to address advisers’ complaints over section K of the RMAR, which requires firms to provide data on payment methods.
It proposed that advisers report charging data annually, rather than every six months, and suggested firms could complete section K on a cash or accruals accounting basis.
The consultation stated that changes to sections K and L, which covers consultancy charging, would reduce advisers’ annual reporting cost to £1.3m from £2.6m, however today’s statement recognised that this may not be the case for every firm, although it added that most will get some cost reduction.
The FCA also stated it will no longer require firms to separately report whether adviser charges were facilitated by product providers or platforms.
The FCA said: “We received some suggestions around how the data collection could be further simplified.
“A number of respondents said the requirement to separately report whether adviser charges were facilitated by a product provider or platform service provider was particularly onerous.
“Having considered our use of this data, we concluded that the marginal benefits of collecting this breakdown were outweighed by the time and money that firms would save if we stopped it,” the FCA continued, adding that firms will only be required to report a breakdown of adviser charges by those paid directly by client and those facilitated by a product or platform service provider.
The changes to professional staff data reporting will take effect in two stages: the first from 1 October reflects the policy changes pre-Mortgage Market Review implementation and the second from 1 January reflects the changes post-MMR implementation.
