CASS and Safeguarding

At Johnston Carmichael we recognise that the Client Assets Sourcebook (CASS) is a demanding area of compliance for financial services firms. Whether you are a new entrant to the market or an established firm that is growing or looking to diversify, CASS obligations can create regulatory and operational challenges.

The Financial Conduct Authority (FCA) continues to prioritise client asset protection as evidenced in their strategy. This means that for firms to be able to comply with the CASS rules they must be able to demonstrate robust governance, controls and assurance processes.

CASS Audits: why real-world experience matters

There is no one size fits all when undertaking a CASS audit. A firm’s application of the CASS rules is shaped by their business model, governance framework, operational controls and processes, and the application of technology.

At Johnston Carmichael we understand the importance of having a specialist team to undertake regulated assignments. Our dedicated CASS audit team has in-depth knowledge of the issues facing regulated firms, and real-world operational CASS experience allowing us to develop thorough understanding of our clients’ business models and the application of the CASS rules. We recognise the value and importance of long-term relationships with clients, in a specialised area like CASS.

We are proactive in interpreting and understanding new regulatory developments from the FCA, and assessing the impact that these may have for our clients and to our CASS audit approach.

It is fundamental for a firm to appoint CASS auditors who have the appropriate industry knowledge to perform a robust, efficient, and effective audit. We believe that we provide this balance, and we apply the same high standards to every CASS audit that we undertake, whether it is a reasonable or limited assurance engagement.

CASS Audit Team

Our dedicated CASS audit team have deep sector knowledge and understand the practical nuances of CASS compliance. We provide authoritative guidance together with a robust, practical and cost-effective CASS audit service.

Not only does our team have extensive CASS audit experience, but we also have a deep understanding of the financial services sector and the risks firms face. One of our key differentiators is the input by senior members of the audit team ensuring consistency quality and informed decision making throughout each stage of the CASS audit.

Our team have the prerequisite knowledge and experience to assess audit risks from different perspectives, creating a high quality CASS audit that prioritises efficient challenge and professional scepticism, and brings best practice to the table. This ensures that not only are our CASS audits technically compliant but that they are in line with current and emerging best practices.

We continue to invest in our CASS audit practice to ensure that we uphold our quality service, and attract individuals with the prerequisite CASS knowledge and real-world experience required to undertake CASS audit engagements.

We support our CASS audit team by placing importance on continuous CASS training and encourage the sharing of CASS experience, knowledge and best practice across the team.

CASS Audit – IT review

We recognise that technology has an important role in ensuring ongoing CASS compliance. At Johnston Carmichael, our dedicated IT audit team works in collaboration with the CASS audit team to assess controls across key systems and applications. This integrated approach enables early identification of potential CASS related risks.

How do we add value?

Our approach is that of collaboration and building lasting relationships with our clients. To support and strengthen our clients’ ongoing compliance with CASS, we raise matters that come to our attention during the CASS audit in a detailed management letter.

We provide accompanying recommendations for potential improvements to systems, procedures and controls. Our insights are based on best practice operational experience within our CASS audit team, gained when working in the financial services sector.

Our CASS Audit Services

We support all key areas of CASS audit engagements:

• CASS 3 collateral
• CASS 5 client money - insurance distribution
• CASS 6 safe custody assets
• CASS 7 client money
• CASS 8 mandates
• Reasonable assurance engagements
• Limited assurance engagements

We also support safeguarding audits providing independent assessment of the systems and controls payment and e-money providers have in place to safeguard client funds.

Get in touch

To find out more about our CASS and Safeguarding Audit Services, or to discuss your audit requirements, please get in touch with Gillian Boston.