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Why Does Your Company Need AML/CFT Audits?

By June 3, 2022 No Comments
Why Does Your Company Need Anti-Money Laundering and Counter Financing Terrorism Audits

Why Does Your Company Need Anti-Money Laundering and Counter Financing Terrorism Audits?

Audits can be a headache and feel like just another compliance tick box exercise and expense. But truthfully, there are more benefits to Anti-Money Laundering and Counter-Terrorism Financing (AML/CFT) Audits than just compliance. Find out why your company needs AML/CFT Audits in this article.

What is an independent AML/CFT Audit or Review?

An independent review is an objective assessment of your AML/CFT risk assessment and AML/CFT programme. It checks that you are complying with your programme and it:

  • properly addresses your company’s money laundering and terrorism financing risks
  • complies with your legal obligations under the Act
  • is working as it should.

Here is why your company needs Anti-Money Laundering and Counter Financing Terrorism (AML/CFT) Audits:

Meet your obligations under the AML/CFT Act

If you are a Reporting Entity (RE) covered under the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act), you are legally obligated to have an AML/CFT audit conducted by an independent and appropriately qualified individual every two years.

AML/CFT audits are required under the Act to ensure that reporting entities have robust systems and processes in place to detect and deter money laundering and the financing of terrorism.

For more information, refer to the ‘Guideline for audits of risk assessments and AML/CFT programmes’ available on our website here.

Protect your business from the risks of Money Laundering (ML) and Terrorism Financing (TF)

An independent AML/CFT audit will help ensure that your company’s AML/CFT policies, procedures, and controls remain up-to-date and properly address the risks of money laundering and terrorism financing in your business.

More importantly, an audit will identify any deficiencies in the adequacy and effectiveness of your AML/CFT programme so that these can be remediated before your business is exposed to criminal financial activity.

Keep up with ever-changing AML/CFT legislation and regulations

The legislation and regulations are constantly changing. As a busy owner of a company, it may be hard for you to keep up with or understand what the amendments or changes to the AML/CFT Act mean for your business. A regular, independent AML/CFT audit by a qualified auditor can help you stay on top of any changes and ensure you continue to meet your obligations.

Improve your AML/CFT processes and controls

Contrary to popular belief, auditors are not trying to catch you out or trip you up. AML/CFT auditors and advisers are professional people providing you with a service primarily designed to improve your compliance with the AML/CFT Act.

Rather than viewing an AML/CFT audit or review as a test, consider this audit as an opportunity for you to obtain another person’s view of how well your AML/CFT programme and AML/CFT risk assessment are designed and working and how you could improve.

On top of any compliance with the Act, your auditor will also be looking for any areas where you can make optional process improvements to improve your efficiencies.

Address any AML/CFT compliance issues early, while the cost of remediation is low

Like most issues, the longer you leave them the bigger the consequence (and the cost to fix them). If compliance issues are not identified and addressed early in the regime, the cost to remediate these may be significantly higher. An AML/CFT audit is an opportunity for you to have those issues identified and subsequently corrected while the cost of remediation is still low.

Minimise the risk of negative regulatory attention

If your AML/CFT supervisor receives an audit report they believe has been completed to a good standard, it will influence their monitoring behaviour. AML/CFT supervisors take a risk-based approach to their inspection programme and a good audit (with good outcomes) will likely reduce the need for direct engagement or further regulatory attention.

How One AML Audit can help

As an experienced independent AML/CFT Auditor, we can take care of all of your audit needs. From pre-audit reviews to a full independent audit and review of your AML/CFT Programme and Risk Assessment.

Book a free 15-minute consultation here or reach out to discuss any questions you may have.