When reviewing the FCA documentation, IFAC look for the killer comment.  The understatement or innocent looking booby trap.  Take for instance the difference between “being compliant” and “demonstrating compliance”.  In case you had not quite realised, it is a world apart, marked by something not much more than a change of emphasis.

IFAC have been working on the NCD.  Again, if you had not realised what NCD stands for,  then you will weirdly connect to this article.  These TLAs now litter all FCA speak – a new language that all regulators use and then weaponise in their industries.   So what nuance, killer comment or emphasis am I referring to this time?

Well, the FCA use many different tools and language to ensure compliance, and they neatly define them below in the NCD policy paper.

• “Must”: where an action is required by a Principle or rule
• “Should”: where we think a firm ought to consider a course of action (not specified in a Principle or rule) to comply with a Principle or rule, but this does not necessarily mean they must follow a detailed or prescribed course of action
  
• “May or could”: where an action is only one of several ways of complying with a Principle or rule
  

This is our compliance world.  The sad truth is that only a tiny minority fail under the “must” category, but nearly all of us are at risk from actions that lie in the other two categories.   Use IFAC to ensure that your actions under the last two categories are stamped for approval.  This is especially important given the NCD’s drive for counter party compliance. 

IFAC are working on the NCD, to improve on their automated planning report writer, and we will have an automated reporting tool for you to download your actions and activities on NCD shortly.