Investment firms are obliged to establish and implement an ICAAP, pursuant to Paragraph 33, Section 5, Chapter 1, Part II of the Directive for the Prudential Supervision of the Investment Firms (hereinafter, the ‘Directive’), as well as the Guidelines GD-IF-02 and GD-IF-03. Together with the ICAAP Report and the subsequent Supervisory Review and Evaluation Process (SREP) from CySEC , fall within the scope of the Pillar 2 rule as set and discussed in the Basel III Capital Accord of the Bank of International Settlements (BIS) and also in the Directive.

The ICAAP shall be embedded to the core of operations of a company, and shall comprise as well as align the overall Risk Management System, Governance Framework, Internal Control system, the definition of its financial budget and corporate strategy, and the alignment of those with a company’s available capital and  the risks faced. The ICAAP serves as a valuable Risk Management tool which ensures that a Company’s Risk Management framework receives the necessary attention from all the related functions/personnel of a company and ensures the forging of a robust organization by promoting a risk-averse culture within all company.

The Board of the Company and the Senior Management shall ensure the appropriate design, adoption and implementation of the Company’s ICAAP, by performing their ICAAP related duties and responsibilities as these shall be detailed in the ICAAP Report of the Company.

The ICAAP Report shall be drafted and reported to the Board, at least on an annual basis. The ICAAP Report is also comprehensively and formally documented which has to be   submitted to CySEC upon request for the performance of the SREP.

Qualified personnel of our company can help you with structuring and drafting of your ICAAP Report and developing ICAAP documentation for presentation to regulator. T.F.S. Tailored Fin Serve Ltd. Is also able to help you with stress testing and capital allocation exercises performing.