Not many of us like filling out forms but it’s not all bad news and painstaking form filling when it comes to completing annual reports. While you might be glad it only happens once a year, it can be a positive experience and creates the perfect opportunity to review your AML compliance overall.
Why are annual reports important?
You’re unlikely to get any feedback on your report (unless there are issues), so it can feel like an additional piece of time-consuming admin that no reporting entity really wants, but there are some very real reasons for completing your annual report:
- They are used to inform regulatory approaches. If the DIA is inspecting an entity, one of the first things they’ll look at is your annual report, so it pays to make sure it is correct.
- They help the regulators understand your entity better, and provide important information which they might not otherwise have.
- They track progress in meeting AML requirements and identify areas where improvements may need to be made.
- Annual report time is a good time to review your risk assessment and AML compliance programme. These need to be reviewed on a regular basis anyway, so why not review now and make sure everything stacks up and things are being done the correct way.
- It is a good opportunity to see if you’ve undertaken any action since your last independent audit, whether you implemented recommendations, or you have areas to work on.
And apart from that, like it or not, as part of the FATF regulations, AML annual reports are here to stay, so it makes sense to embrace the benefits, and set ourselves up for success with an organised, timely approach.
Get started
If you’re like most people, you probably don’t think much about your AML annual report until you have to. But they can take a while to complete so it pays to avoid the stress of last minute completion and get started early.
DIA portal opens on 1 July but it is a good idea to review guidance from supervisors, make sure you understand what information you need to gather, and that you can gather this information easily. To even begin your annual report submission, you will need access to the DIA AML Online portal. If you don’t already have one, you will also need to create a verified RealMe account.
The application can take up to five working days so allow time for this.
Gathering the required information
Entities have been completing annual reports for three years, if not longer now, and generally will find the information that is asked for is similar year on year. Your reporting information should include everything from the previous year 1 July – 30 June. You will have two months to file your report.
The annual report covers five broad topics:
- Your contact details and organisation structure
- Designated Business Group, AML/CFT risk assessment and AML/CFT programme
- Your products and services, customers and channels
- AML/CFT supervisor specific questions
- Compliance with exemptions
Typically, these topics require details on:
- What kind of business you’re doing
- How you service your customers
- Information on the types of customers you’ve onboarded, and how many
- How much money has been involved
- Methods used to carry out customer due diligence
- Whether you’ve had an audit, the results of the audit, and what you’ve done about it
If you are following a well-structured compliance programme, this information should be readily available to you, and generally supervisors are finding most entities are filling out details correctly in the DIA system. The biggest error appears to be entities not filing their reports in time.
Last year the supervisors were more lenient and provided extensions due to the impact of COVID on businesses, however, they are likely to take a very dim view of late entries this year.
And remember, if you are part of a Designated Business Group (DBG), you will still need to complete a separate report for each reporting entity.
While your submissions may not be reviewed straight away, supervisors will sweep their databases to check everything has been filed by entities, and your report will be reviewed should any compliance action be required in the future.
Taking the stress out of annual reporting
At tic company we believe not having access to annual reports can create a big knowledge gap for supervisors, and it is critical for them to be able to access this information. We also know how time consuming it can be for entities compiling annual reports, so as part of our customer due diligence process, you can access important annual reporting information through your client portal login.
This includes key information on number of customers, PEP’s, high risk customers, companies, trusts, etc. so you can get started on filling out your annual report from 1 July 2022, as soon as the DIA AML Online portal opens.
You have two months to complete and file your report which might seem like a long time, but the sooner you start, the better. We haven’t found many people who enjoy filling out the report, but we do know it’s a lot less stressful if done early.
If you need any help accessing your data, or have any questions, contact our analyst team at info@ticcompany.com.
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