Individual Accountability Framework Assurance Reviews

Introduction

The Individual Accountability Framework (IAF) impacts all Regulated Financial Services Providers (RFSPs) and individuals who perform controlled functions (CFs) on their behalf. Certain RFSPs (including most credit institutions, insurance firms and MiFID firms) are additionally in scope for the Senior Executive Accountability Regime (SEAR).

The staggered implementation dates across the separate but inter-related IAF components are drawing near[1]. As such, Board members, other Senior Management and CF role-holders are understandably shifting focus towards an assessment of the adequacy and appropriateness of the following:

• Internal governance arrangements in place to oversee IAF compliance in BAU
• Embeddedness of key requirements across impacted end-to-end processes and related entity-level documentation (such as Code of Conduct, Disciplinary Process, Fitness & Probity procedures, etc.)
• Conduct Standards Training programmes
• Key controls across end-to-end processes supporting IAF compliance
• Reasonable Steps determination, documentation and evidencing by Pre-Approval Controlled Function (PCF) and CF role-holders
• (Where also in-scope for the SEAR), Statements of Responsibility for PCF role-holders; and Management Responsibilities Map at legal entity level (inclusive of any branches)

How we can help

We are happy to discuss your IAF assurance needs and to provide a number of support options (such as the provision of outsourced/co-sourced internal audit services), covering:

• Design and execution of a range of IAF testing and monitoring plans, to provide assurance to Board and Senior Management on the adequacy of arrangements and key controls in place to ensure ongoing IAF compliance
• Deep-dive or targeted assurance reviews for example: the allocation of responsibilities under the SEAR; the determination, documentation and evidencing of Reasonable Steps by PCF and CF role-holders; and the process and key controls supporting F&P certification

Our unrivalled team of multi-disciplinary professionals can provide specialist input, having been engaged by an Irish Pillar Bank, as well as a number of other Credit Institutions, Investment Firms and Insurance Undertakings to provide IAF advisory services and full-scale pre-implementation readiness support. We have also provided vendor assurance and system integration support regarding IAF technology platform enhancements.

In addition to the above, we have access to a panel of subject-matter experts at our UK firm, who have advised clients over a number of years and provided assurance services relating to aspects of the Financial Conduct Authority (FCA) Senior Manager & Certification Regime (SM&CR).

[1] 29 December 2023 for Conduct Standards; and enhancements to the F&P Regime; and 01 Jul 2024 for the Senior Executive Accountability Regime.