When accounts reconcile and regulatory returns are filed on time, management has reasonable evidence that the reporting process is working. It still needs to establish whether the financial requirements have been applied correctly.
Regulatory reporting involves judgements that cannot be settled by checking the arithmetic. A figure may agree to the ledger yet require a different treatment under the applicable prudential rules. A reconciliation shows where the number came from; the FO must also establish whether it belongs in the calculation.
Reporting dates create another potential blind spot. A healthy capital or liquidity position at quarter-end does not establish that the firm met its requirements throughout the quarter. Correcting a shortfall does not remove an earlier breach or any obligation to notify the regulator.
The review should reflect the firm’s regulator and licensed activities. For an outsourced Finance Officer in ADGM, this includes checking that the firm’s FSRA requirements are correctly reflected in the calculations. Management should know whether the reported position relies on an uncertain interpretation, whether any shortfalls arose between reporting dates and what remains unresolved.
I would expect the Finance Officer to keep a clear record of how the reported figures have been derived and why the regulatory treatment is appropriate. That requires a sound understanding of the relevant rules and a willingness to seek clarification where the position is uncertain.
If an error is found, management should receive a clear account of its effect, the submissions affected and the steps needed to put it right. That includes assessing whether the regulator must be informed and who will take responsibility for each action.
An outsourcing arrangement should also preserve the firm’s access to the workings behind its returns. When assessing finance officer services, management should establish who holds those records and what happens if the provider changes. An outsourced Finance Officer in the UAE should leave sufficient documentation for a successor to understand the calculations and follow up unresolved matters. Otherwise, the next appointment may simply inherit the same uncertainty.