Arrangements for submission of audited financial statements and annual regulatory (or compliance) returns in response to Covid-19 restrictions (2021)
The Authority has reviewed the requirements for financial and regulatory returns in the light of the current (March 2021) Covid-19 restrictions in place in the Isle of Man. The Authority will continue to keep a watching brief and monitor the situation to identify whether other regulatory requirements may require a different approach.
1. Audited Financial Statements, other Audit Confirmations, and Annual Regulatory (or compliance) Returns
The Authority is mindful that, for some regulated entities, the current situation may lead to delays in finalising Audited Financial Statements and potentially other Audit Confirmations (for example audit management letters). This is particularly the case for regulated entities whose normal deadline for submission is four months after the financial year end. Accordingly, the table below shows where the Authority will allow some flexibility for those regulated entities where their audit may be affected by Covid-19 related issues. For regulated entities whose normal deadline for submission is six months after the financial year end, no changes currently apply.
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Normal deadline for submission of Audited Financial Statements |
New deadline for submission of Audited Financial Statements |
Other returns to be submitted with the Audited Financial Statements |
|
Four months after the financial year end |
Where it is not possible to complete the audit due to Covid-19 issues, regulated entities can submit up to six months after the regulated entity’s financial year end |
If the audited financial statements (or audit confirmations) are delayed, only submit this information alongside the audited financial statements (within 6 months). If fully complete prior to the usual four month deadline, and the audited financial statements are not delayed, submit all information as normal. |
|
Six months after the financial year end |
No change |
No change |
Regulated entities are encouraged to submit information to us (in one pack) before the extended deadlines, where possible. If the extended deadlines cannot be met, we ask that you engage with the Authority in a timely manner; there is no requirement to notify us in advance that you are using the extended deadline.
Noting the above, if a regulated entity fails to meet the six month deadline, this may be treated as a breach in the normal way (and in some cases administrative civil penalties may be applicable).
2. Quarterly Financial Resources Returns – annual audited expenditure figure
Certain regulated entities are required to submit quarterly Financial Resources Returns (FRRs).
Where a delay to the audit means a regulated entity does not have a new annual audited expenditure figure for inclusion in a quarterly FRR, the regulated entity should use the last audited expenditure figure from the previous financial year end. If a regulated entity’s expected new annual expenditure figure (unaudited) would result in its financial position falling below or within 110% of any of the minimum regulatory requirements, the FRR using the previous audited figure should be accompanied by a notification explaining the situation.
3. Other Requirements (in addition to those in 1 above)
The regulatory requirements applicable to regulated entities continue to apply. This includes the submission of periodic returns and other information to the Authority.
However, if a regulated entity is not able to meet the normal deadlines applicable to the submission of periodic returns or other information, and delays are caused by Covid-19 related issues only, the Authority may accept this and not record the late submission as a breach or contravention of the applicable regulatory requirement. In such circumstances, if administrative civil penalties are also normally applicable, the Authority will also waive those.
If a normal deadline cannot be met, we ask that you engage with the Authority in a timely manner to advise us of the reasons for the delay and an expected submission date.