GABRIEL Reporting by Colin Buckland
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the corresponding ‘ credit ’ has been received from the customer or product provider .”
Therefore , those with only a Statutory Trust Account should enter Zero here ( See note 2 ) as under the rules you are not permitted to fund client premiums from the account .
There is often confusion regarding completion of Section C on the RMAR return . The Financial Conduct Authority has issued new guidance in the help texts on reporting this , particularly regarding questions 2 , 3 , 4 , 5 and 6 .
Question 2 – If you only operate an Insurer trust account only tick box 2A .
If you operate a statutory trust and co-mingle client and risk transfer monies , tick 2A and 2B . If you operate a Non-Statutory trust and co mingle client and risk transfer monies tick 2A and 2C . If you operate individual accounts tick the boxes that apply .
Those with only a Risk Transfer account should not complete question 3 , 4 , 5 or 6
Question 3 - Only applies to IFAs .
Question 4 - “ Credits are money paid by a customer into a client money account which has not , as of the reporting period end date , been forwarded on to a product provider for payment and any undrawn commission due to the firm .”
For those with only one co-mingled Statutory or Non- Statutory trust this will be the balance on the account as at the last date of the reporting period .
For those operating more than one account it will be the total balance of all the accounts , excluding any Insurer Trust accounts as at the last date of the reporting period .
However bear in mind that any money owing to clients for example return premiums received from insurers should not be in the account as under CASS 5.5.4 it must be paid as soon as possible , and no later than one business day after the money is due and payable .( see note 1 ) Question 5 – “ Debits are money owed to the client money account as payment has been made before
Those with a Non-Statutory Trust account should calculate the total amount of the items that are being funded . i . e . where a premium has been paid to an insurer before it has been received by the client or where a credit has been given to a client before it has been received from an insurer . ( See note 2 )
Question 6 - Net client money balance as at reporting date is therefore question 4 minus question 5
Note 1 It would be good business practice to check that all client money due to clients had been paid to them as part of a month end routine . Most back office systems should have a facility to do this .
Note 2 For those firms operating a Statutory Trust account , you should not be funding clients out of this account so you should really be checking on a monthly basis that you are not .
Areas that may present problems in this area are Third Party Premium Finance Companies cancelling agreements and deducting one client ’ s premiums from the payments that they make to you , as you will probably not have received the credit from the insurer or payment from the client .
Another area is the client that takes a credit when paying another premium before it has been received from the insurer
Where these occur you should pay the money into the Statutory Trust account from the office account until it has been received as cleared funds from the client or insurer .
For those firms operating a Non-Statutory Trust account you should also be checking on a monthly basis the items that you are funding . This is so that you can identify items that have been outstanding too long and that may become bad debts .
In addition you will need the figure to calculate your Section C GABRIEL return .
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