FCA writes to CEOs on prudential returns

FCA has published a “Dear CEO” letter setting out its comments on the quality of prudential returns. It is concerned that a significant number of firms are submitting returns that contain inaccurate or incomplete data and, as a result, feels it needs to ask CEOs of IFPRU and BIPRU firms to review their firms’ regulatory reporting practices.

FCA has found common issues of:

• firms failing to complete certain underlying templates in the COREP submissions because they have not understood the relevant rules;
• not submitting certain returns;
• incorrect calculation of total risk exposures, which leads to the wrong figure for capital requirements;
• inconsistent completion of COREP returns;
• using incorrect units when reporting and
• not reporting cumulatively on the FSA002 Income Statement.

FCA says it will review a sample of firms’ returns as of 1 October.