How to get FCA authorised (part 3)


As part of our How To series on 'How to get FCA authorised'. We are addressing all aspects of preparing for FCA authorisation. This will look to cover a range of key items your business should consider from the location of offices, and expected fees to resourcing.


In our previous session, we covered:

  • systems and controls

  • target customers

  • fees and charges

  • financial promotions

We will continue the series on the below, with a final article on times:

  • Complaints

  • Financials

  • Final Application Step

If you would like further detail on an area covered, feel free to reach out to the team.




Dealing with complaints

You must ensure your internal complaint procedures clearly and prominently state that the customer has a right to complain, including the ability to escalate a complaint to the Financial Ombudsman Service.

You will need a complaints policy that aims to ensure that:

  • making a complaint is as easy as possible;

  • you treat a complaint as a clear expression of dissatisfaction with our service which calls for an immediate response;

  • you deal with complaints promptly, politely and, when appropriate, confidentially;

  • you respond in the right way - for example, with an explanation, or an apology where you have got things wrong, or information on any action taken etc;

  • you learn from complaints i.e. root cause analysis, use them to improve your service, and review annually your complaints policy and procedures.

This will be an opportunity for your firm to ensure its complaints procedures consider the handling of complaints, monitoring complaint levels and/or issues.

MEMA offers bespoke management information metrics to help firms report effective complaints analysis to senior management in their business.


Financials

You must evidence that your firm has sufficient capital requirements in place. This is different depending on the industry and required permissions, so start to speak with your accountants to provide a clear view of whether your firm is able to meet its liabilities as they fall due and can provide realistic forward projections.

Remember you are required to hold an appropriate level of capital and/or liquid resources to cover potential harm. Capital includes elements of your equity and appropriate loss-absorbing debt liabilities which rank behind general creditors, such as share capital and retained earnings and subordinated debt.

Liquid resources are normally those that you can convert into ‘cash’ as soon as needed and with minimal loss in value.

Key documentation you will need will be your annual accounts and a 3-5 year cash flow projection. You may also need to upload a copy of your capital resources calculation.


Final application steps


Before submitting your regulatory business plan and supporting documents you must ensure the information contained within the application is clear, concise, and detailed.

You must review your selected permissions and assess whether they are related to the business activities you undertake. If you have misunderstood your permissions this could lead to concern from the regulator that you have not exercised due diligence when completing your application.

Review your answers and ensure you have not used boilerplate or irrelevant responses. If you decide to use a consultancy firm make sure you read the content and are familiar with it. Of course, check the content actually relates to business operations e.g. stating you have 20 members of staff and you employ five personnel.



 

Did you know that MEMA has created content on the above in the form of an ebook guide?

If you would like further detail on the FCA authorisations process, please reach out to the team.