Irrespective of whether your firm needs a statutory audit you may require a CASS audit. CASS stands for Client Assets Sourcebook and the rules around this are in place to safeguard client assets. This is an area of huge interest to the FCA and a CASS audit gives them an independent view of your firm’s compliance with the CASS rules.
There are two types of assurance report, Reasonable Assurance or Limited Assurance. The type required depends on the category of authorisation you hold and we can help you establish what you need to do. The deadline for these reports is 4 months from the end of the reporting period so get in touch today if you are unsure about the requirements for your firm.
CASS rules for Designated Investment Firms (DIF’s)
Designated Investment Firms or DIF’s are required to comply with CASS 7 (client money) and CASS 6 (custody assets) of the FCA rules. Even firms that don’t hold client assets may still require a CASS assurance report. There are some exemptions such as investment management or personal investment firms that do not require a statutory audit. All assurance reports for DIF’s are sent directly to the FCA from the auditor.
Which reports do you need?
The following breakdown shows which reports are required, however the rules are not straightforward so please get in touch and we can help you establish what your firm needs.
Reasonable assurance report – Your firm holds both client money and safe custody assets
Limited assurance report – Your firm is permitted to, but claims not to hold client assets, or, does not have the permission to hold client assets
Hybrid assurance report (Includes both of the above for different elements of client assets) – Your firm holds client money but not safe custody assets or vice versa
CASS rules for Mortgage and General Insurance Firms (MGI’s)
Mortgage and General Insurance Firms or MGI’s may be required to comply with CASS 5 of the FCA rules. The type of assurance report required depends on the type of client account your firm holds and the amount of money held. These reports are addressed to the FCA but sent only to your firm and the FCA may request them from you.
The reporting requirements are as follows:
Reasonable assurance report – Your firm holds a non-statutory trust client account, or, more than £30,000 of client money
No assurance report required – Your firm holds no more than £30,000 of client money in a statutory trust account