Compliance management

Regulatory risk is defined as the risk of suffering financial or reputational damage as a result of failure to comply with laws and regulations, and with group and other externally defined policies and standards.

Your regulated financial services firm will be required to meet and demonstrate compliance with the ongoing obligations as required by the Central Bank i.e. regulatory risk/compliance management. Given the introduction of Directors Compliance Statements by the Central Bank the management of regulatory risk is becoming an increasing priority for our financial services clients.

How can PwC assist you?

Whatever the financial services business sector that your firm operates within, we can assist you in all aspects of meeting the ongoing legislative and regulatory obligations that apply to your firm.

Our services include:

  • Compliance frameworks / Risk based compliance monitoring

    The compliance function is coming under ever increasing pressure, recent regulatory developments such as the Consumer Protection Code, Minimum Competency Requirements, Corporate Governance Code, Fit & Proper Requirements and the Markets in Financial Instruments Directive have only resulted in imposing additional requirements to the already heavily burdened compliance professional. Compliance departments are adding more and more resources and taking on further responsibilities in an attempt to stay on top of the ever changing regulatory landscape.

    We believe that a risk based approach to compliance is the best response to the risk based supervisory regime adopted by the Central Bank.

    A risk-based compliance monitoring programme involves identifying the areas of high risk within your organisation and building upon and prioritising your compliance monitoring programme around these risks. This type of approach will focus your organisation and your compliance resources on the areas of high risk and in particular, those key risks which are most likely to cause concern. In turn, this approach highlights the importance of compliance, which should be fully embedded and integrated within the business and should not operate as a function executed in a vacuum.

    Our risk based compliance monitoring framework will provide:

    • Assistance with the identification of inherent and residual compliance risks within your organisation.
    • Support with defining your risk appetite.
    • Design and development of a 'compliance universe'.
    • Design and development of Key Performance Indicators (KPI's).
    • Assistance with the design of compliance monitoring programmes and reporting documentation.

    Why choose PwC?

    • We have assisted many clients across a wide business spectrum in the development of a risk based compliance monitoring framework and specific to the firm's needs and requirements.
    • Our extensive compliance experience in this area allows us to tailor specific programmes to meet the needs of your organisation and in terms of addressing fully, the key areas of risk inherent in your business while ensuring these risks are appropriately monitored and given adequate focus.
    • We will bring, to your firm, industry best practice models and critically examine and benchmark your organisation against these models, supporting you in implementing recognised gaps where appropriate.

     

  • Compliance function effectiveness

    In conjunction with the widespread recognition of risk based compliance monitoring as being at the forefront of best practice in compliance management, is a move to develop methodologies and processes for actually assessing the effectiveness of the compliance function. In an industry of ever changing regulation, financial services firms remain constantly challenged in keeping their compliance function in line with new requirements and it is often difficult when operating within the area to objectively assess the extent to which the compliance function is performing against it objectives and discharging its duties.

    In general, this consists of performing a review of the compliance function under some or all of the following headings:

    • Strategy & policy.
    • Structure, roles & responsibilities.
    • Understanding of obligations.
    • Measurement (KPI's) & improvement.
    • Documentation.
    • Communication & interaction.
    • Monitoring & response.
    • Reporting.

    This type of review can be completely tailored to your requirements, incorporating 'deep dive' reviews of areas of particular concern or providing a high level analysis of the overall effectiveness of your compliance function.

    Why choose PwC?

    • We offer independent objective advice; we are not linked to any particular part of a client's business and can objectively examine all elements of the business.
    • The regulatory advisory services team has the technical skills to support firms in determining the effectiveness of a firm's compliance function. We have extensive experience in brining firms in line with the applicable legislation and furthermore providing assurances around the effectiveness of their compliance function to meet these legislative requirements.

     

  • Compliance health checks

    The Central Bank has indicated, through its Strategic Plan 2008 - 2010, that it is continuing to increase it's supervisory and enforcement powers (e.g. on-site inspections and the Administrative Sanctions regime). With the move towards more in-depth risk based monitoring and in conjunction with the regulator's strategic objectives, there is an increased need to validate your firm's compliance with the key legislative framework applicable to it. By way of example, having fully implemented the Consumer Protection Code, the Central Bank has now moved to monitoring firms compliance with the Code by use of themed inspections and mystery shopping exercises. How comfortable is your firm that your organisation will perform well in the face of an on-site visit, themed visit or mystery shopping undertaken by the Central Bank?

    Our service offerings include:

    Assistance with preparation for these scenarios by conducting a compliance "health-check" within your organisation. This "health-check" can be tailored to your requirements (i.e. we can review your performance against all your compliance obligations or only a very narrow portion of your compliance obligations) and would typically involve the following:

    • Interviewing key stakeholders within the firm.
    • Review of the compliance processes within the organisation.
    • Review of approach to and organisation of compliance within the organisation i.e. how compliance is organised and embedded throughout the organisation, including benchmarking against good / best practice.
    • Testing performance of processes against compliance obligations i.e. sampling.

    This type of "health-check" will provide you with an independent view of the state of compliance within your organisation.

    Why choose PwC?

    • We can work with you and tailor specific health check programmes to provide the specific assurances around the compliance requirements applicable to your firm.
    • We have a diversified range of experience and best practice industry knowledge, this is key to addressing the issues detected during an in-depth "health check review".

     

  • Anti money laundering reviews

    Across all jurisdictions and due to the ever increasing fight against terrorism and drug trafficking, there is increased emphasis on strengthening Anti Money Laundering regimes and there is greater onus on individual firms and money laundering reporting officers to ensure that sufficient resources, systems and experience are in place to prevent and detect money laundering issues.

    Transposition of the Third Anti Money Laundering Directive increases the scope of firms captured under the definition of designated bodies, introduces enhanced measures and obligations for designated bodies to verify beneficial ownership and establishes a new risk based due diligence approach to the Anti Money Laundering regime.

    Financial Institutions are increasingly aware that as well as costly litigation and large fines, successful penetration by money launderers may also cause incalculable damage to corporate and professional reputations and careers.

    A thorough and robust anti-money laundering programme is key to safeguarding your business from the threat of money laundering.

    PwC provides firms with detailed AML assistance and support services including but not limited to the following:

    • Diagnostic / review / gap analysis of AML/CTF policy and procedures against AML and financial crime regulations and industry best-practice.
    • Design and optimisation of AML/CTF internal controls.
    • Designing and implementing adequate and effective procedures.
    • Review of data management, and Know Your Customer (KYC) systems.
    • Developing and implementing a risk-based AML control framework and monitoring programme.
    • Assistance and support in dealing with regulatory enforcement actions and remediation exercises.

    Why choose PwC?

    • We have assisted many clients across a wide business spectrum to enhance their Anti Money Laundering Regimes.
    • We have performed detailed gaps analysis of the AML procedures, designed and upgraded current frameworks not only to help establish that they operate within the legislative requirements but also to provide assurance that they are sufficiently robust to safeguard the business in this challenging environment where we are seeing more and more sophisticated measures to launder money.

     

  • Client money audits

    Client money is money which, in the course of carrying on investment business, a firm receives, holds, controls, or pays out for or on behalf of clients. Money, in turn, includes cash, cheques or other payable orders together with current and deposit accounts maintained with credit institutions or relevant parties. Client investment instruments consist of investment instruments which, in the course of carrying on investment business a firm receive, hold, controls or pays out for, or on behalf of, clients.

    A firm, which receives, holds, controls, or pays out client money or client investment instruments must do so only in accordance with the client money requirements.

    PwC can assist you with an assessment of compliance with the Central Bank’s client money requirements including:

    • Review and reporting of client money policies & procedures.
    • Interaction with Audit for current Section 10 IIA firms.

    Why choose PwC?

    • The PwC brand brings a distinctive level of quality assurance.

     

  • Remuneration policies

    We can assist you in understanding the regulatory requirements with respect to remuneration policies and specifically assist you with:

    • Drafting a remuneration policy in accordance with regulatory guidelines.
    • An assessment of the likely impact of regulatory guidelines on your remuneration practice.
    • Implementation of revised remuneration policies.

     

  • Remediation services

    Remediation assistance

    If your firm is facing a regulatory on-site inspection, we can assist in your preparation prior to the regulatory review and provide you with some comfort that your business is operating in line with the regulatory requirements.

    If your firm has just undergone an on-site regulatory review and there are noted action points, we can assist you in addressing these regulatory issues to so that your business is in line with the current and forthcoming regulatory requirements.

    Examples of our work in this area include:

    • Pre-Inspection advice and assistance.
    • Follow up regulatory assistance from Central Bank Inspections.
    • Regulatory remediation projects.

    Why choose PwC?

    • We have assisted a number of firms in identifying the legislative gaps in their compliance frameworks and provided support in formulating action plans to bring their business into line with the regulatory requirements.
    • We have provided project management assistance to successfully implement the required changes and so that the firm is no longer on the regulator's watch list.