SM&CR – Statement of Responsibilities

If you have read anything about the Senior Managers and Certification Regime (SM&CR), you will know that each Senior Manager will need to have a Statement of Responsibilities (SoR). You might even have looked around for a template SoR. And you might have ended up a bit confused!

An initial search could well have taken you to the FCA final guidance paper ‘FG19/2 Senior Managers and Certification Regime: Guidance on statements of responsibilities and Responsibilities Maps for FCA firms’

However, despite the title promising much, this paper is more about how to identify the SM&CR elements of an individual’s roles and how to complete a SoR.

After much rummaging about in the FCA Handbook and various other places, you might have ended up at SUP 10C Annex 10D, where a link to what purports to be a SoR can be found. Hallelujah! Eureka!

But don’t celebrate too soon. The form found here purports to be a SoR and also suggests that it is mandatory. Neither is true.

First, the form relates to dual-regulated firms (firms regulated by both the FCA and the PRA) and so, by definition, is not suitable for use by FCA solo-regulated firms that the SM&CR is being extended to in December 2019. The equivalent form for solo-regulated firms can instead be found at page 391 of policy statement PS 18/14. (Note that the page is not actually numbered as such , you need to go by the page numbers shown in your PDF reader.)

This ‘template’ will be available on Connect from 9th September 2019.

The second issue is a confusion over the nature of this form. The notes suggest that it is mandatory but in fact it is only the information and format of the presentation of the information to the FCA that must be done according to this form. Beyond that, it is not really a template at all. 

At a pinch, firms could use this template in paper form as is, but it is neither very user-friendly, nor, at 23 pages plus a further 3 pages of annex, does it remotely meet the FCA’s guidance on creating an SoR which is that a SoR should be a single document describing what the Senior Manager is accountable for, must be as brief as possible, self-contained without reference to other documents, succinct and clear without unnecessary detail.

In practice, when an application for approval (e.g. Form A) is submitted to the FCA, the SoR will need to be submitted to the FCA into Connect in the format on the ‘template’. The system will generate the form as part of the application. But, since there is likely to be a degree of transposing of information anyway, we think that firms might prefer to create a more user-friendly version for internal use, which is easier to use, but still follows the format of the Connect version so facilitating ultimate transposition to Connect.

ATEB has created such a template as part of our suite of SM&CR tools.

Important Note: ATEB news is intended to provide general information ONLY. The content, including any views expressed or guidance provided, does not replace the need to comply fully with FCA Rules and Guidance. Unless you have discussed news article content with ATEB, and specifically how it relates to your circumstances, then ATEB disclaims all liability and responsibility and actions arising from any reliance placed upon it. For the avoidance of doubt therefore, any reliance you place on such information without our consultation is at your own risk.

ATEB Compliance offers compliance and regulatory advice.

ATEB Suitability provides report writing software for the financial services market.

Our View

Firms will need to create or acquire a whole range of new documentation to support implementation of SM&CR. HR processes, including recruitment, appraisal and disciplinary processes and contracts of employment will all need to be reviewed and amended as required.

ATEB can help with many of these aspects.

Finally, you may be aware that existing Senior Managers who will have the same role after 9 December will be automatically converted from the existing CF function to the new SMF function. Where an individual in a solo-regulated firm is auto-enrolled (converted) into Senior Management Functions, there is no need to send a SoR to the FCA, but the individual will still need to have one so our SoR template could take one SM&CR task off your desk.

Action Required By You

  • For further information or help with SM&CR, contact your usual ATEB Consultant, or contact ATEB directly here.
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About the Author

Technical Manager - Often referred to as the Oracle or the Sage, Alistair has a wealth of financial services experience. He is our go-to Technical Manager and enjoys nothing more than a complicated conundrum. Feel free to test his renowned knowledge by getting in touch.

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