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FIC: Directive on Employee screening
- 03 April 2023
- Accounting
- South African Accounting Academy
This Directive applies to all accountable institutions.
Accountable institutions must screen prospective employees and current employees for competence and integrity periodically, in a risk-based manner.
An accountable institution must scrutinise information concerning its prospective employees and current employees upon notice being given by the Director under section 26A(3) of the FIC Act, to determine whether any such prospective employee or current employee, is a person mentioned in the notice by the Director.
This Directive is issued under section 43(1)A of the Financial Intelligence Centre Act, 2001, as amended, the directive is described as ‘a money laundering, terrorist financing and proliferation financing control measure’.
Inserted in the principal statute by the Financial Intelligence Centre Amendment Act, 2008, section 43(1)A allows the FIC to issue directives on measures to promote compliance by accountable institutions
Gazetted on 2 April 2023, the directive 8 came into force on 31 March 2023 (the date of its covering notice).
Click here to download the FIC Directive 8 of 2023:
Relevance to Auditors, Independent Reviewers & Accountants:
- The Financial Intelligence Centre Act (FICA) is yet another piece of legislation that your clients must comply with, and which you must assess compliance with. If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
- As an auditor and independent reviewer, you need to consider amendments, regulations and directives that are gazetted relating to FIC and accountable institutions, to ensure that your clients (or even your own practice) comply with their regulatory FIC and reporting obligations.
Relevance to Your clients:
- Relevant entities (specifically accountable institutions) have a duty to comply with the FIC Act, otherwise they could be held liable.
- Relevant entities should be aware of amendments, regulations and directives that are gazetted relating to FIC and accountable institutions, to ensure that they comply with their regulatory FIC and reporting obligations.
To stay current with all the latest changes and updates subscribe to our Monthly Compliance and Legislative Update series for R 250.00 per month. This gives you access to a monthly 2-hour webinar and monthly newsletter:
https://accountingacademy.co.za/profession/monthly-legislation-update
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