As part of their obligations under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017), all accountancy firms are required to conduct, document and maintain an up-to-date firm wide risk assessment (FWRA).

To assist firms in meeting this important requirement, we have published a revised technical factsheet: firm-wide risk assessment.

The factsheet provides practical guidance on how to approach the FWRA process and includes a template designed to help firms identify, assess and document the money laundering risks they face. The template is accompanied by explanatory notes, examples and practical prompts to support firms in completing a meaningful assessment tailored to their own circumstances.

A firm-wide risk assessment is a fundamental component of an effective anti-money laundering (AML) framework. It enables firms to understand where they may be exposed to money laundering, terrorist financing and proliferation financing risks and to implement appropriate controls to mitigate those risks.

The factsheet highlights the key risk areas that firms are required to assess, including:

• client risk
• geographic risk
• products and services risk
• transactions risk
• delivery channels risk
• proliferation financing risk.

The guidance also reminds firms that a FWRA is not a one-off exercise. Risks evolve over time, and firms should review and update their assessments regularly to reflect changes in their client base, services offered, geographic exposure, regulatory requirements and emerging criminal threats.

While the template provides a useful starting point, firms should ensure that their FWRA is tailored to their own business model, client portfolio and risk profile. A generic assessment that simply reproduces template wording is unlikely to satisfy regulatory expectations.

As part of the assessment process, firms should consider relevant guidance and intelligence sources, including:

• MLR 2017 and MLR Amendment 2019
• CCAB Anti-Money Laundering Guidance for the Accountancy Sector (AMLGAS)
• HM Treasury National Risk Assessment
• FATF Guidance for a Risk-Based Approach for the Accounting Profession
• National Crime Agency alerts and publications
• The UK Sanctions List
• Transparency International’s Corruption Perceptions Index

The role of the Money Laundering Reporting Officer (MLRO) is particularly important in this process. MLROs should ensure that the firm remains aware of emerging risks and that the FWRA is reviewed periodically and approved by the firm's management.

We encourage all firms to review the new factsheet and assess whether their current FWRA remains fit for purpose. A well prepared and regularly updated FWRA not only helps firms comply with their legal obligations but also strengthens their overall AML compliance framework.

Download the new technical factsheet: firm-wide risk assessment now.

As part of the regular review of our AML hub, a number of other factsheets have also been updated. Visit the hub for the latest versions.