How does the implementation of SM&CR impact CASS firms

Implementation of the Senior Managers and Certification Regime is currently underway and may well have an impact on your firm’s existing CASS arrangements. This is because the FCA, as part of the SM&CR rules, has introduced a new Prescribed Responsibility for firms that hold client money. Overall responsibility for CASS becomes a Prescribed Responsibility and therefore must be assigned to the most senior person in the firm responsible for CASS. This is a Senior Management Function distinct from the CASS Oversight role which is a more operationally focused role, usually the responsibility of a certified person.

 The new rules may give rise to the following outcomes:

  1. Where a Senior Manager is assigned the Prescribed Responsibility for CASS and is also responsible for the day-to-day operational activities of CASS Oversight. There will be no requirement in this instance for a separate certified CASS Oversight function. The CF10a becomes the Senior Manager responsible for CASS.
  2. Where a Senior Manager is assigned the Prescribed Responsibility for CASS but is not involved in the CASS Oversight role, delegating the responsibility to a certified individual (CF10a), operationally focused on CASS. The CF10a in this instance is a certified person distinct from the Senior Management Function for CASS.

What does this mean for you? 

Large CASS firms, classified as Enhanced firms under the new regime, will be required to put in place additional measures to meet the requirements of the regime – including Management Responsibilities Maps and documented Handover processes. Medium/Small CASS firms (Core firms), will not be subject to these requirements, but would certainly benefit from the measures proposed for enhanced firms if they chose to adopt them.  

It is commonplace for Senior Managers’ responsible for CASS to have other responsibilities outside of CASS, delegating most of the day-to-day CASS responsibilities to other individuals in the firm. Under the new regime, Senior Managers will be required to put in place appropriate team structures, delegation processes and management information/reporting tools to demonstrate that they have taken reasonable steps to discharge their CASS oversight responsibilities.   

How prepared are you for these changes? 

Given the FCA’s continued focus on effective CASS oversight, Ruleguard has extended its regulatory compliance software to help firms comply with the broader requirements of the Senior Managers Regime, tailoring the solution to meet the unique demands of Core and Enhanced firms.   

The Ruleguard for SMCR solution supports and automates the new processes required by the regime for senior managers and other employees, helping the senior managers and certified persons keep track of the responsibilities they have been allocated, the documentation they need to provide, and detailed governance information that proves they comply. 

Key features of Ruleguard for SMCR solution 

Create ‘Statements of responsibilities’ for individuals:

  • Automatically create and maintain these documents as required by the new regime.

Manage ‘responsibility maps’ for your firm

  • Visual overviews of your business and essential documentation for Enhanced Scope firms

Assign Senior Managers functions and prescribed responsibilities

  • Demonstrate coverage of all essential functions quickly and easily

Carry out ‘fit and proper’ reviews

  • Show evidence that people are suitable to carry out their roles

Track professional development and training

  • Ensure that all staff are fully qualified and remain so over time.

Manage certification of individual

  • Fulfil this regulatory obligation automatically through an online workflow

Notify the Regulator of breaches

  • Provide evidence of control findings and show that corrective action is being carried out

Drill down to detailed analysis of functions and responsibilities

  • Maintain effective oversight of your area through detailed process and control reviews

Detailed MI and personalised dashboards for each role

  • Quickly evaluate your areas of responsibility at a glance