For many years legal, accountancy and consulting firms have worked on different areas of regulation, but the lines between them have blurred. The FCA and PRA have recently published their skilled persons panel to monitor firms’ activities concerning regulation.
For many years legal, accountancy and consulting firms have worked on different areas of regulation. Lawyers have helped understand the legal aspects of the regulatory regime (what permissions are needed, interpreted regulatory activities orders, etc.), accountants have dealt with practical matters (written business plans, compliance manuals, etc.), and consulting firms have tied things together with clever approaches, quants and new systems.
Over the last decade these lines have increasingly blurred. For example, the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) have recently published their skilled persons panel. The FCA and PRA use skilled persons to obtain an independent view of aspects of a firm’s activities that cause the regulators concern or where further analysis is required. They also use skilled persons to monitor, and sometimes complete, large undertakings like past business reviews.
The panel is split into 8 lots covering matters from client assets to Insurance Prudential. And we see lawyers, accountants, consultants, actuarial firms and niche consultancies all represented in the panels. This means there is considerable choice and that care is needed from firms and regulators in choosing the right firm for the right scope.
The FCA commissioned 19 skilled persons reports in 3 months to the end of June 2013 and 31 in the previous quarter. In addition, there is an increasing trend towards attestation statements from senior staff and internal reports for the regulator. In short: lots of work.
We expect this blurring of the traditional lines to increase and for the work of these firms to also increase.
– Mark Davies