Senior Manager Handovers: What a Good Handover Pack Contains
When a Senior Manager leaves and a successor takes over, the quality of the handover shapes everything that follows. An incoming Senior Manager is accountable from the day they’re approved for the role. If they don’t know about a problem their predecessor knew about, they may still be expected to have found it. The regulators recognise this, and firms within the relevant parts of the regime must have handover arrangements. This guide explains what the rules expect, what a good handover pack contains, and how firms can run a handover well even when the outgoing Senior Manager has already gone.
Why Handovers Matter Under the SMCR
Under the Duty of Responsibility, a Senior Manager can be held accountable if a breach happens in their area and they didn’t take reasonable steps to prevent it. “Their area” doesn’t start fresh on the day they join. Problems that already exist become their problems. A good handover is the first and most important of the reasonable steps an incoming Senior Manager can take, because it tells them what they’re inheriting.
For the firm, a handover also protects continuity. It makes sure that knowledge about risks, open issues and regulatory commitments doesn’t leave with the person. The FCA’s SYSC 25 sets out requirements on management responsibilities maps and handover procedures for the firms it applies to, and the PRA has equivalent expectations for dual-regulated firms. The core expectation is that firms take reasonable steps to make sure an incoming Senior Manager has the information and material they could reasonably expect to need to perform their responsibilities effectively.
What a Good Handover Pack Contains
| Section | Contents |
|---|---|
| Responsibilities | The Statement of Responsibilities, the relevant part of the responsibilities map and any Prescribed Responsibilities |
| Current state of the area | A frank summary of how well the area is working, its main risks and its key controls |
| Open issues | Known breaches, incidents, complaints themes, audit findings, remediation actions and their status |
| Regulatory matters | Open regulatory correspondence, commitments made to supervisors, ongoing reviews, attestations and upcoming deadlines |
| Management information | The reports the Senior Manager receives, what they show and any known weaknesses in the data |
| People and resources | The team, key individuals, vacancies, certification status and budget |
| Governance | Committees attended, reporting cycles, delegations and decision rights |
| Third parties | Key outsourcing arrangements and suppliers, with any concerns |
| Plans | Projects in progress, planned changes and regulatory change affecting the area |
| Contacts | Internal and external contacts, including supervisors, auditors and advisers |
The most valuable section is usually the frank summary of the current state. Formal documents describe how things are supposed to work. A good handover tells the successor how they actually work, and where the outgoing Senior Manager would look first.
Running a Handover: Practical Steps
- Start when the departure is known. Ask the outgoing Senior Manager to begin the handover pack as soon as they resign or a change is agreed, not in their last week.
- Use a standard template. A consistent structure makes sure nothing important is missed and makes handovers comparable across roles.
- Arrange an overlap if possible. Even a short overlap between outgoing and incoming Senior Managers is valuable. Where the successor is waiting for approval, they can shadow without performing the function; see managing the gap between offer and approval.
- Involve others. The chief executive, chair, compliance, risk and internal audit can each add perspective on the area’s strengths and weaknesses.
- Have the incoming Senior Manager confirm receipt. A short acknowledgement of what they received, and any gaps they’ve identified, creates a record that protects both of them.
- Follow up. The incoming Senior Manager should review the pack, ask questions and record their own initial assessment within the first weeks.
Scenario: A wealth manager’s compliance officer resigns with three months’ notice. The firm asks him to prepare a handover pack using its standard template, including a frank assessment of the suitability file review backlog. His successor, still waiting for approval, spends two weeks shadowing him in a non-SMF capacity. On her first day as SMF16, she records her own assessment of the backlog and a plan to clear it. When the FCA later asks about the backlog, the firm can show exactly when the new compliance officer learned of it and what she did.
When the Predecessor Has Already Gone
Sometimes there is no one to hand over. The outgoing Senior Manager left suddenly, was dismissed, or is unwilling to help. The firm still has a responsibility to give the incoming Senior Manager what they need. In that case:
- compile the pack from records: board and committee papers, MI, audit reports, regulatory correspondence and the issues log
- ask the people who worked most closely with the predecessor to contribute
- if an interim held the function, ask them for a handover of their own
- allow the incoming Senior Manager extra time for their own review before relying on the picture
- consider an independent review of the area if there are signs of significant problems
Our guides to what to do when your MLRO has resigned and to the other SMCR forms, including Form C when a Senior Manager leaves, cover the steps around a departure.
The Incoming Senior Manager’s Own Record
Whatever the quality of the handover, the incoming Senior Manager should make their own record of what they found. A dated note of their initial assessment, the issues they identified and the actions they planned is valuable evidence of reasonable steps. It also helps them later, if a problem that predates their arrival comes to light. Keep it factual and specific. Our guides to the first 90 days for a new MLRO or compliance officer and to Statements of Responsibilities suggest what to look at first.
Handovers and Recruitment
Handovers are easier when they are planned into the recruitment timetable. Firms that start succession planning early, using a tool such as our succession planning template, are more likely to secure an overlap. Where there is a gap, an approved interim Senior Manager can hold the function, maintain the records and provide a handover to the permanent appointee. The 12-week rule may help with short, unforeseen gaps.
When we recruit a Senior Manager, we talk to the firm about the handover early, because it affects the start date, the overlap and what the candidate needs to see before accepting. Candidates increasingly ask about the state of the area they’ll inherit, and a firm that can describe it honestly is more attractive to the best people.
Common Handover Weaknesses
| Weakness | Consequence | Fix |
|---|---|---|
| Handover written in the last week | Rushed and incomplete | Start on resignation |
| Only formal documents | Successor learns how things should work, not how they do | Require a frank current-state summary |
| Open issues omitted | Successor inherits unknown problems | Cross-check against the issues log and audit findings |
| No acknowledgement | No record of what was handed over | Have the incoming SMF confirm receipt and gaps |
| No plan for sudden departures | No handover at all | Keep area records current so a pack can be compiled quickly |
SMF Succession and Cover
Planned transitions and interim cover. Every SMF search is led personally by Adrian Lawrence FCA
Succession
Planning before you need it.
→ Succession planning template
→ Internal or external?
Interim Cover
Holding the function in between.
→ Fractional and interim cover
→ The 12-week rule
Recruitment
Finding the successor.
→ SMF recruitment services
→ Retained executive search
Templates
Documents that support a handover.
→ SoR template
→ Responsibilities map template
Every SMF search is led personally by Adrian Lawrence FCA
Frequently Asked Questions
Is a Senior Manager handover a regulatory requirement?
For firms within the relevant rules, yes: they must take reasonable steps to make sure an incoming Senior Manager has the information and material they need. Even where the rules don’t strictly apply, a handover is good practice and strong evidence of reasonable steps.
Who is responsible for the handover?
The firm is responsible for having handover arrangements. The outgoing Senior Manager should prepare the pack, and the incoming one should review and acknowledge it.
Can the successor see the handover before approval?
Yes, under appropriate confidentiality, provided they aren’t performing the function before approval.
What if the outgoing Senior Manager won’t cooperate?
Compile the pack from records and colleagues, allow extra review time and consider an independent review if there are signs of problems.
Should the handover be kept?
Yes. Keep the pack, the acknowledgement and the incoming Senior Manager’s initial assessment as part of the firm’s SMCR records.
About the Author
Adrian Lawrence FCA is the founder of SMF Capital. He is a Chartered Accountant and Fellow of the ICAEW, holds a practising certificate in his own name, and is a former listed-company Finance Director with a BSc from Queen Mary College, University of London. He founded FD Capital in 2018 and has since built a network of five specialist recruitment practices, including NED Capital. He leads every SMF Capital search personally, including planning the handover and start date. View Adrian’s ICAEW profile.
Replacing a Senior Manager?
Whether you need a permanent successor, interim cover during the transition or both, tell us about your hire. We’ll come back to you the same working day.
Adrian Lawrence FCA is the founder of SMF Capital and a Fellow of the Institute of Chartered Accountants in England and Wales and holds an ICAEW practising certificate in his own name. He holds a BSc from Queen Mary College, University of London, and has over 25 years of experience working with boards, investors and business owners across the UK. He founded SMF Capital to help FCA and PRA-regulated firms appoint the Senior Managers the regulators expect, with the fit and proper assessment built into every search, and personally leads every Senior Manager Function search.
