News Article Published:
Monday, 30 July 2007
Category:
Financial Services
The profile of individual accounting firms could be made or broken as the Treasury publishes new money laundering legislation.
From December 15th companies that offer accountancy, tax, audit and insolvency services must have their compliance monitored by HM Revenue & Customs if they do not have this carried out by an independent body.
Accountants will have to request proof of identity for existing clients as well as higher risk clients, such as officials residing outside the EU and people they have not met face-to-face. They will also be required to demonstrate risk assessment procedures and conduct their client due diligence on that basis.
The Institute of Chartered Accounts in England and Wales (ICAEW) welcomes the new legislation, which could add further credibility to professional accounting services which are member firms of the institute.
Felicity Banks, head of business law at ICAEW, said: "Most professional accountants routinely take a risk based approach to their work, and these changes mean that a common sense approach will be in line with the letter of the law as well as professional requirements.
"For very simple firms, a simple risk assessment will be appropriate and quite sufficient. Existing clients will usually already be well known to the firm, so limited additional evidence of their identity will be required - like a copy of their tax return, or bank correspondence, which are likely to already be on file."
Karen Silcock, chair of the ICAEW money laundering working party, added: "These regulations go further than those currently in force in embedding in law certain key requirements. This should bring welcome clarity, and promote consistency across the regulated sectors, whilst retaining vital risk-based flexibility in detailed implementation."
This news will also boost the ICAEW's campaign for the term 'accountant' to be legally protected as well as meaning that accountants will be able to advertise their services as responsible.
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