Regulation  

Eight key takeaways from FCA accountability paper

“However, firms will have the opportunity to provide supplementary relevant information as part of the statement of responsibilities where this is necessary to record a person’s responsibilities accurately.”

6) Fresh SIF approvals.

Article continues after advert

Individuals holding a ‘significant influence functions’ only need a fresh approval if they are taking on a new role that requires a senior management function not equivalent to any SIF that they are already approved to perform.

So, for instance, someone who is currently approved to perform the CF1 executive director function would be able to take on responsibility for investment management, but not the SMF16 compliance oversight function without a new approval.

In addition, the SMF18 ‘other overall responsibility’ function only applies if an individual holds no other SMF.

If an individual is grandfathering to any SMF, and will also pick up a responsibility that equates to an SMF18 ‘other overall responsibility’, the SMF18 function will not apply and therefore no additional approval is required.

Although firms will not have to apply for a new approval for individuals who take on new responsibilities without taking on ‘senior management functions’, they will be required to set out all their responsibilities on the individual’s statement of responsibilities.

7) Shared responsibilities are frowned upon.

The regulator believes that responsibilities should generally be performed by one individual, however it does accept there will be “limited circumstances” where sharing or dividing a responsibility may be appropriate, providing the firm can confirm that no gaps in the allocation of responsibilities arise as a result.

Where a particular area of a firm is co-headed by two individuals, splitting or sharing a function or responsibility may be justified, the paper said. However, the regulator stressed that firms will need to think carefully about the responsibilities of each individual in any such situation and make sure that these are appropriately reflected in ‘statements of responsibilities’ and ‘responsibilities maps’.

8) Looking to fix SPS “problem”.

The paper confirmed that the importance of statements of professional standing, which were introduced by the RDR, remains unchanged. However, there is an “operational issue” to be resolved, owing to the fact that SPSs currently make use of individual reference numbers under the approved persons regime.

Working with the affected bodies, the regulator will announce a solution to this operational problem in the coming months.

donia.o’loughlin@ft.com