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What has happened? 

In August 2022, the FCA issued its Policy Statement PS 22/11 Improvements to the Appointed Representatives regime. The changes in this PS took effect from 8^th December 2022.

You can read our blog post on this subject here.

What are the key points?

PS 22/11 requires principal firms, among other things, to annually review information on their ARs’ activities, business, and senior management and to prepare a self‑assessment document at least once a year, covering how they meet the requirements of the policy. The self-assessment document must be approved by the principal’s governing body and it must be made available to the FCA on request.

The key purpose of the annual self-assessment document is to ensure that the firm and its governing body regularly consider and assess the principal’s ability to effectively oversee its ARs, identify any risks or weaknesses in its processes and systems, and take action to address any risks arising from the firm having ARs.

Firms should by now have completed their first year’s self-assessment, for the year ending 30^th November 2023, and they may be considering how they can improve on the assessment for the next review year. In the PS, the FCA comments that principals do not need to create a new self-assessment document each year. Principals can review and update their current assessment before seeking governing body approval, and we recommend that updating and improving their self-assessments should be an ongoing task for principal firms and that they should review their progress on this through their compliance monitoring programmes.

Some points for consideration when doing this are;

• Is the planned frequency of updates of the self-assessment appropriate?
• Is the format correct and does it make clear that the process is a self-assessment?
• Is there an element of benchmarking against desired outcomes?
• Are key issues covered where relevant? – these might be, for example, the use of the regulatory hosting model, overseas ARs, or larger ARs.
• Will the governing body be able to assess immediately what the firm’s status is?
• If the FCA requests the document, is it likely to answer any queries that the FCA may have?

How can we help you? 

Thistle Initiatives has supported principal firms for over 10 years as a trusted compliance and regulatory advisor. In addition to assisting you as-and-when, our team of specialists can serve as your right hand in meeting and complying with FCA regulations. We understand the importance of staying up-to-date and compliant and are dedicated to providing the guidance and support needed to do so.

Are you looking for help with your annual principal firm self-assessment, your Appointed Representative supervision procedures, or more general regulatory questions? Contact our specialist lending team now to schedule a free consultation. Get in touch with us by calling 020 7436 0630 or sending an email to info@thistleinitiatives.co.uk.