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The term compliance describes the ability to act according to an order, set of rules or request.
In the context of financial services businesses compliance operates at two levels.
Level 1 - compliance with the external rules that are imposed upon an organisation as a whole
Level 2 - compliance with internal systems of control that are imposed to achieve compliance with the externally imposed rules.
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There is considerable variation within and across pay scales for compliance and compliance related roles. Salaries tend to focus on the skill sets required for a role, rather than being defined by the job title. Therefore, no two compliance officer roles are likely to be established on the same pay scale.
Compliance professionals not only navigate a complex regulatory environment but also add a key commercial perspective. They enable the right business to be conducted in the right way and help firms achieve success by using systems and controls to ensure effective risk management.
The availability of funding varies from jurisdiction to jurisdiction. Funding is available in some jurisdictions for programmes of study leading to ICA qualifications. Discover what funding is available to you.
What duty, objective and responsibility does a Compliance Officer fulfill?
DUTY - The Compliance Officer has a duty to his employer to work with management and staff to identify and manage regulatory risk.
OBJECTIVE - the overriding objectives of a compliance officer should be to ensure that an organization has systems of internal control that adequately measure and manage the risks that it faces.
RESPONSIBILITY - The general responsibility of the Compliance Officer is to provide an in-house compliance service that effectively supports business areas in their duty to comply with relevant laws and regulations and internal procedures.
What are the five key functions of a Compliance Department?
Corporate governance is a highly inclusive concept that covers a number of different aspects about the way in which an organisation is managed, directed and governed.
It can be described as a set of relationships between a company’s management, board, shareholders, and other stakeholders, which provides the structure through which the objectives of the company are set. Furthermore it provides the means of attaining and monitoring performance against those objectives.
What does the term 'regulation' mean?
The term ‘regulation’ generally refers to a set of binding rules issued by a private or public body with the necessary authority to supervise compliance with them and apply sanctions in response to violation of them.
What are five generally accepted key core objectives of financial services regulation?
Although there is no unified theory of financial services the key objectives of regulation is as follows.
What are three key attributes of effective regulation?
Effective regulation is regulation that:
What is primary and secondary legislation?
Primary legislation refers to the Law, Act or Ordinance passed by the legislative of a particular jurisdiction.
The legislature in many jurisdictions has the power to delegate or subordinate law making powers to other agencies that may then make delegated or subordinate legislation often referred to as “secondary” legislation. In the context of financial services, secondary legislation is generally legislation that has been drafted by a regulatory body empowered to do so pursuant to the primary law by which it is established.
What are regulatory codes or rules?
Codes generally set out the broad principles by which a regulated business is expected to conduct its business.
Rules are generally very detailed and relate to every regulated activity and function.
What are regulatory guidance notes?
Guidance can either be in the form of a statement of best practice or a statement of minimum best practice.
Occasionally a regulatory authority will feel compelled to issue detailed guidance to regulated businesses on how it expects them to actually discharge their legal and regulatory obligations. Anti money laundering and terrorist financing is one area where most regulators around the World have issued guidance.
What functions does a regulator usually fulfill?
In broad terms regulators fulfill the following seven functions:
What steps does a regulator utilize in it's supervisory process?
Many regulators adopt a risk-based approach to supervision and follow a process of supervision that can be divided into the following four steps:
Step 1. Defining the objectives
Step 2. Obtaining information from regulated businesses
Step 3. Assessing the risk that regulated businesses face and pose
Step 4. Taking action in response to the risk assessment
What two key methods does the regulator utilize in supervising regulated businesses?
There are essentially two methods by which compliance with regulatory rules is monitored – Onsite supervision and Offsite desk based supervision.
What are the two commonly accepted objectives of prudential regulation?
What are conduct of business rules?
Conduct of business rules govern the manner in which a business conducts itself in its relationships with consumers. Conduct of business rules impose minimum standards of acceptable conduct upon regulated businesses.
What aspects of the activity of a financial services business would be subject to the conduct of business rules?
What is regulatory enforcement?
Enforcement is a necessary product of the process of authorisation and supervision, in the sense that a regulator must enforce compliance with rules. Enforcement is as much about investigating, gathering and sharing information as it is about imposing penalties.
What five processes does regulatory enforcement normally entail?
Enforcement generally entails the following:
What are the common enforcement powers of a regulator?
What six basic factors should you consider when looking at risks in your organisation?