• Doing business with the FSA
  • Small Firms
    • General information
      • TCF - deadlines
        • Regional assessments
          • Frequently asked questions

From March 2008 we have been rolling out a programme to assess small firms on a regional basis. The assessment programme will include financial advisers, home finance brokers and some general insurance intermediaries selling higher-risk products. The programme will cover every eligible firm in every postcode in the UK over 3 years.

We will conduct the assessments through a combination of mini visits, meetings and telephone interviews. We also expect to carry out follow up visits to up to one quarter of these firms to verify the mini assessments and to follow up any issues identified. The results of the assessments will help inform our risk-profiling of individual firms so we can more effectively target resources at the firms that may pose the biggest risk to our objectives.

The benefits

• increased contact and help;
• a tough stance against those firms not engaging with us and not committed to treating their customers fairly;
• higher standards; and
• better consumer protection and increased confidence in the small firm financial services industry

We want to work with as many firms as possible to raise standards. So it is important that you engage with us and take advantage of the assistance being offered.

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Preparing for your assessment

The assessment will focus on the first of the 6 TCF consumer outcomes.

The assessment will look at the relationship the firm's management has with its staff, how it communicates TCF to its entire staff (not just advisers), and what controls it has in place to demonstrate that it, and its staff, are delivering fair outcomes to its customers.

Each regional programme will consist of the following stages:-

1) Control sample' assessments

A small number of firms in a particular region will be selected for control sample assessments.  These firms are selected randomly on a representative basis from the total population of firms to be assessed in a particular region.  The control sample assessments will take place prior to the Roadshows and before the main roll out of the programme.

The control sample assessments will take the same form as the mini assessments, but will happen a few weeks earlier.  The purpose of the control sample is to provide a measure for the FSA of how effective the Roadshows are in communicating messages to firms and to identify whether there are any issues relating to a particular region, which might impact on the overall programme of assessments.  If a firm is assessed as part of the control sample, this will be taken into account by the assessor, though the expectation is that the firm will already have met the March 2008 TCF deadline and will be working towards the December 2008 deadline.  Control sample firms are likely to experience a much longer gap between their mini assessment and any follow up visit arranged (see 4. below).

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2) Roadshows

The second stage of each regional programme consists of a number of Roadshows which will take place in venues within the region.  All firms will receive an invitation to these well in advance of the dates available.  Places are limited so it is important to book your place as soon as you can.  You will have opportunities to work through real TCF issues that may affect your firm and learn from other firms about how they approach these. Through these interactive Roadshows you should gain a clearer idea of our expectations regarding TCF and this may help you prepare more thoroughly for the assessment process.

3) Mini Assessments

A mini assessment is a 1-1.5 hour interview with a member of the FSA's staff. These may happen on the telephone, face to face at your premises, or face to face in a regional venue. You will receive notification of your assessment date and venue by e-mail a few weeks beforehand. You need to respond to that e-mail to confirm your attendance at the time/place advised, and to send in various pieces of information about your business, e.g. your TCF GAP analysis, if available.

There may be two (and occasionally more for training purposes) FSA staff conducting your assessment, which will comprise a discussion with you about the small firm management behaviours framework. We will ask you questions about the five key drivers - leadership, business decisions, controls, recruitment/training, and reward - to establish the approach of management within your firm. A simplified assessment process will be used for sole advisor firms. You will be given verbal feedback at the end of the assessment, which will be confirmed in writing to you within 10 working days. For more details about mini assessments, please see the FAQs.

4) Follow Up Visits

A number of firms assessed will receive a follow up visit. These will be either  a half day visit to verify the information you provide during your assessment, or full day for those firms about which we have most concerns based on their assessment answers.

The half-day visit will normally consist of a discussion with you to confirm the content of the assessment and to assess any changes/progress since, followed by file reviews on a sample of your files. At the end of the visit, you will be given oral feedback on our findings. This feedback will be confirmed in writing within two weeks of the visit.

The full day visit will be an opportunity for much more detailed discussion with you and scrutiny of a larger sample of your files. The object of the visit is to gather evidence to see if our concerns are justified and, if so, to take action with you to put things right. It may be that during the visit concerns identified during the assessment will be addressed or could be found to be unsubstantiated.  Whatever the outcome, you will receive oral feedback at the end of the visit, which will be confirmed in writing shortly afterwards. Any follow up work with your firm, if required, will be overseen by a supervisor, who will remain in contact with you until all matters are resolved.   It would be useful if visiting FSA staff can be given a space to work in your office away from the day to day business. If this is not possible, we will work around you.

What else do you need to know?

To date (mid-August 2008), progress on the assessment programme is, as follows:

Northern Ireland – 252 firms received a TCF assessment between March – April 2008 and 46 firms received follow up visits. Feedback from firms about the process has been very positive, with the majority of firms saying that the assessment process added value to their business and helped to clarify the FSA's expectations of the firm in respect of TCF.

Manchester, Liverpool & Bolton Area – Control sample visits in this region took place in mid-March and Roadshows in April/May. Assessments took place between 3 June-16 July. Follow up visits are currently taking place.

Birmingham – Control sample assessments took place in mid-July and roadshows will take place in September. Assessments are due to commence in late September. South West – work in this region will start in November, with the main roll out of the regional programme taking place in early 2009.

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