The announcement comes after a number of small firms expressed their dissatisfaction with the need to complete RMAR audit reports on a six-monthly basis.
Despite the FSA promising to review its audit requirements policy for small firms and appointed representatives as part of its move to phase out regulation where the costs outweigh the benefits, brokers have suggested further relaxing of regulations would allow them to focus on clients needs and reduce their costs.
Lax Mayani, adviser and proprietor of Cliveden Financial, said: “I am a sole trader, directly authorised by the FSA. There are many small firms like myself who are not necessarily doing high volume business and I see no point at all in having to do an audit report (RMAR), especially every six months. I think we should really be exempt from doing this, which would save us time and money on this unnecessary compliance issue.”
Kevin Morgan, managing director at Consilium Financial Planning, added: “At the moment there are huge costs to bear and if the FSA is saying small firms don’t have to be audited, they must be happy with the compliance that RMAR gives. As with any new initiative, when it first comes out it is very demanding and you would hope the onerous requirements of RMAR would be relaxed.”
However Sam Bennett, press officer at the FSA, said RMAR was essential so the FSA could judge the market. She said: “We need to know what is going on in the market and RMAR allows us to monitor it on a regular, six-monthly basis. There are no current plans to remove it, but we will be undertaking a review in quarter three. RMAR is something the FSA is looking into.”
