Regulatory Reporting: Who Actually Supports Your SMF16 and SMF17

We spend a lot of time on this site talking about the individuals who hold Senior Manager Functions — the personal accountability, the Form A process, the fit and proper test. What gets discussed far less is the team underneath them who actually produce the numbers and returns an SMF16 or SMF17 holder is personally signing off. A compliance officer or MLRO is only as good as the regulatory reporting function feeding them, and that function is a specialist finance appointment in its own right, not an extension of general financial control.

The Accountability Doesn’t Stop With the SMF Holder

Under the SMCR, the SMF16 Compliance Oversight holder and SMF17 MLRO carry personal, individual regulatory accountability. But neither of them typically prepares the underlying regulatory returns themselves — that work sits with a regulatory reporting function inside finance, whether that’s a dedicated regulatory reporting manager, a financial controller with a reporting remit, or, at smaller firms, a fractional or interim specialist brought in specifically for this purpose. If that function is weak, inaccurate, or simply under-resourced, the SMF holder is signing off numbers they cannot actually stand behind with genuine confidence — and when something goes wrong, the personal accountability still lands with them, not with the reporting team that produced the flawed number.

What Regulatory Reporting Actually Involves

The specific returns a firm files depend entirely on its permission set and firm type — COREP and FINREP for many prudentially regulated firms, sector-specific returns for consumer credit or payments firms, and the various financial resources and safeguarding returns the FCA requires from specific business models. What’s consistent across all of them is the standard the work needs to meet: these are not internal management reports where an estimate or a rounding convention is good enough. A regulatory return is a formal submission to the FCA, and errors in it — particularly in capital or liquidity reporting — are treated by the regulator as a serious matter in their own right, independent of whether the underlying business itself is healthy.

This means the person or team responsible for regulatory reporting needs a level of technical precision and process discipline that goes beyond what a good management accountant typically brings to internal reporting, combined with a genuine understanding of what the return is actually measuring — not just how to populate the template.

A Recurring Career-Stage Problem

We increasingly see a specific hiring pattern: a Senior Finance Manager or Financial Controller who has been doing general financial control work well is asked to take on regulatory reporting responsibility as the firm’s SMF16/17 holder needs more support, without the firm properly assessing whether that individual has the specific technical grounding the reporting actually requires. It’s a natural instinct — promote from within, extend a trusted person’s remit — but regulatory reporting is a specific technical discipline, and a strong general financial controller does not automatically have it. Firms making this transition internally need to ask pointed, specific questions about the individual’s actual exposure to the relevant returns before assuming the extension of responsibility is safe.

What a Strong Regulatory Reporting Hire Looks Like

Direct, hands-on experience of the specific return set the firm files — not adjacent regulatory reporting experience the candidate assumes will transfer; genuine understanding of what each return is measuring and why, rather than template-level familiarity; a track record of catching and correcting errors before submission rather than after a regulator query comes back; and comfort working closely with the SMF16 or SMF17 holder as a genuine technical partner, since the reporting function and the SMF holder need a working relationship built on mutual, informed trust rather than one party simply signing what the other produces.

Fractional and Interim Support

Not every firm — particularly smaller FCA-authorised businesses — needs a full-time regulatory reporting hire. Fractional and interim regulatory reporting specialists are increasingly common, brought in for a set number of days a month or for a defined period around authorisation, a permission change, or a period where the in-house function needs additional technical depth without a full-time headcount commitment.

For the SMF16 and SMF17 designations themselves — the individuals rather than the team supporting them — see our earlier guide, SMF16 and SMF17: Compliance Oversight and MLRO Explained.