Guidance

1. This Chapter deals with the regulatory requirements arising out of the need for Authorised Persons to carry out a self-assessment of their risk which can be reviewed and assessed by the Regulator. This Chapter details the Rules stipulating the need to complete internal risk assessments by Authorised Persons in defined frequencies and the Regulator's role in reviewing the results of such assessments. In the case of Authorised Persons facing financial risks, the requirements in this Chapter mandate completion of an Internal Capital Adequacy Assessment Process. The Regulator will review the results of such internal risk assessments. This Chapter also sets out how the Regulator may impose an additional Capital Requirement on a firm-specific basis in addition to the minimum requirement specified in Chapter 3 of these Rules to address higher-than-normal risk.
2. App11 provides detailed guidance on the various components of the Supervisory Review and Evaluation Process and explains the role of the different parties in completing the required processes.