How to manage ongoing AML compliance for your practice
Anti Money Laundering (AML) is something all accounting and bookkeeping practices need to take seriously. The consequences of getting things wrong are considerable, so we’ve produced a simple guide to AML compliance that you can download.
We previously wrote about how to ensure that AML processes are built into your onboarding process and the general processes you need to have in place for your practice, such as having firmwide policies and procedures, an AML officer, and regular training for all your practice on AML matters.
Managing AML is an ongoing process. The levels of risk of a client can change, depending on their size and the location of clients they work with. The business may appoint new directors or get new shareholders who could exercise control over the business and as an accountant or bookkeeper you need to make sure that you keep on top of this and regularly review your existing clients.
Documentation is key
Whilst you will have carried out checks when you onboarded a client, you need to consider how frequently these need to be reviewed. This will depend on the risk rating of a client or the clients they do business with. Remember, this risk rating could change over time, a client may take on a contract or start doing business with overseas firms and you need to make sure that you have the relevant controls in place.
You also need to document in your policies and procedures when you will carry out these regular checks, and make sure that you document that they have taken place and keep a record of any updated ID checks or ID paperwork that you’ve seen.
For example, you could decide that you will carry out an annual check as part of producing the annual accounts or filing a self assessment for a client. If this is what you decide is appropriate, then make sure you document what you did to check that the information you hold is up to date and accurate.
You should also decide what might trigger the need for more checks, such as appointing a new director, or taking on a new client in a high-risk country or industry or simply increasing turnover.
AML is everyone’s responsibility
Make sure everyone in the firm is aware of their duties and completes their mandatory training. Also make sure that they understand that if they have any client contact that they take responsibility for keeping clients records up to date and that they are aware of the triggers for increased risk that you set out as a firm.
Let your practice management software take the strain
With all this to take care of you’ll probably realise that the best way to keep on top of everything is with good, cloud-based software such as AccountancyManager by Bright. As well as making sure that your client onboarding is streamlined by automating the writing up of your proposals, requesting professional clearance, chasing up records, and streamlining AML checks. It also automates everything you need to keep on top of AML for your existing clients and lets you set reminders for tasks and jobs that need to be carried out regularly.
It will also help you keep all your records and an audit trail of client contact and correspondence, as well as complete and store risk assessments, manage your clients risk rating, and run updated AML ID and credit checks directly from AccountancyManager.
Compliance with AML regulations is crucial for accountants to protect their businesses and prevent involvement in illegal financial activities. It's essential to stay updated with the latest AML legislation and adapt your processes accordingly to remain compliant. Please note that the specific AML requirements and regulations can vary by country, so it's important to be aware of and follow the regulations applicable to your jurisdiction.
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Bright was created in 2021 when Thesaurus Software Ltd. and Relate Software Ltd. decided to join forces. Bright is a leading provider of accounting, payroll, tax and HR solutions to businesses across the UK and Ireland. We help thousands of accountants, bookkeepers and small to mid-sized businesses become more productive and efficient with our...