In May 2012, the Central Bank published Consultation Paper 59 (“CP 59”) relating to proposed changes to the regulatory reporting requirements of Irish authorised funds, whereby most regular reports/returns will be required to be submitted through the Central Bank’s online reporting system. Following the receipt of responses to CP 59 the Central Bank has confirmed that the vast majority of proposals set out in CP 59 will be implemented in their entirety.
For example, some reports must, in future, be accompanied by completed detailed questionnaires. These include the annual FDI report and audited financial statements.
In addition, two new online returns are also required to be made, namely a sub-fund profile questionnaire which is required to be submitted annually (by 30 June) and, significantly, a regulatory report which must be filed on an “as needs” basis. The regulatory report is required to be used by a fund’s trustee/custodian to independently report breaches and errors to the Central Bank and by a fund to update the Central Bank on suspensions of NAV calculations/dealings for the fund. A regulatory report is only required on the occurrence of: (i) a material breach; (ii) a material error (an “error” is defined as an operational, administrative, custodial or other event that has an impact on the valuation or functional capability of a sub-fund); (iii) a significant matter; (iv) an advertent breach; or (v) NAV/dealing suspension. It is the responsibility of the custodian/trustee to determine “materiality”.
The IFIA made submissions to the Central Bank in relation to CP 59, including seeking guidance on/definitions for these types of reportable events given the scope for different standards being applied across the industry. The Central Bank has made it clear however, in the feedback to the industry in October 2012, that it would not be providing definitions and guidance for escalation. It will therefore be important for the industry to establish an understanding of matters considered to constitute the type of events reportable by the custodian.
The Central Bank intends commencement of the new online electronic submission regime in Quarter 1 2013, with specific dates to be advised.
For further information, please contact one of the key contacts listed above or your usual contact in our Asset Management and Investment Funds Team.
