SMCR: 3 Things Treasury and Finance Personnel Need To Know

By Kyriba

Did you know that you could be held accountable for your firm’s current payment process?


Applicable to all FCA-regulated firms, the Senior Management Certification Regime (SMCR) came into force in December 2019.

Under SMCR, Senior Managers must take ‘reasonable steps’ to manage, operate and control the areas of business under their responsibility. These rules are as applicable to senior managers in Finance and Treasury as well as to those on the board.

If your business has key tasks managed by Fund Administrators and you work in a senior Finance and Treasury role within a Hedge Fund, Investment Manager or Private Equity firm this could apply to you!

Kyriba is helping Treasury/Finance in regulated firms ensure they don’t fall foul – here’s what you need to know:

1. Cash Visibility in Fund Accounts;
It’s common practice for Fund Administrators to manage and maintain bank accounts across individual funds, with no central system providing oversight on account activity. This can result in a lack of visibility.

You can’t control what you can’t see, so if there were to be a critical error or breach resulting in a loss of funds, you could be held individually responsible.

2. Payment Process & Controls;
Payments to/from fund accounts is a critical task that is often managed via email instructions and ultimately managed by Fund Admins. Outsourcing may lead to ineffective payment controls that could result in inefficiencies that increase operational risk that can leave you open to Fraud.

It’s important to consider how much control you truly have over your current payment process with Fund Administrators. An issue with this easily enhanced workflow is not worth the risk. You could be held individually accountable for your current payment process.

3. Reconciliation;
If your period end reconciliation process is heavily reliant on Fund Admins and is managed on Excel, can you be certain that this regulatory requirement is accurate? A fully auditable, centralised system can help ensure you remain in control.

Kyriba helps leading investment managers and private equity firms to solve challenges with cash, payments and reconciliation controls to prevent the potential impact of SMCR.  To learn more about how Kyriba can help you remain compliant, contact Aidan McDonald for further information.

To learn more about Kyriba Active Liquidity, register here to access upcoming Kyriba hosted webinars and workshops.

Further details on the SMCR for FCA regulated firms can be accessed here.