On 11 June 2020, the FCA published Finalised Guidance 20/1: Our framework – assessing adequate financial resources (FG20/1).

FG20/1 follows ‘Consultation Paper 19/20: Our framework – assessing adequate financial resources’ in which the FCA consulted on the purpose of adequate financial resources, what the FCA looks for from firms and its expectations as to the practices firms should adopt within their assessments of adequate financial resources.

In FG20/1 the FCA explains the purpose of, and its approach to the assessment of adequate financial resources, for all FCA solo-regulated firms subject to threshold conditions and/or the Principles for Businesses. It also provides further guidance on the meaning of ‘adequate financial resources. It sets out:

• The role of assessing adequate financial resources.
• What the FCA looks for from firms when assessing adequate financial resources.
• The FCA’s expectations as to the practices firms should adopt in their assessment of adequate financial resources.