In the financial year 2024/25 (FY24/25), ICAEW completed 1,185 monitoring reviews and found 80.0% of firms were compliant or generally compliant. This compares to the previous year, FY23/24, where 1,112 reviews were completed and 80.6% of firms were found to be compliant or generally compliant.

To ensure effective oversight and proportionate regulation, the Institute adopts a risk-based approach to monitoring and conducts a review of a firm’s compliance at least once every eight years. Firms with a higher risk score are reviewed more often.

ICAEW found that the proportion of firms that are compliant had increased year-on-year, from 13.9% in 23/24 to 19.4% in 24/25. A total of 237 firms were required to undertake follow-up action (informal and formal) to improve their processes, a total of 41 firms were fined a combined total of £197,706, and three members were excluded. 

For 2024/25, ICAEW undertook an in-depth analysis of firms found to be non-compliant, assessing factors such as size of firm and whether findings were first-time or repeat issues. The Institute also considered whether the root causes vary depending on the method of follow-up, either through informal procedures that required firms to implement an action plan under delegated staff authority or through formal processes involving the Practice Assurance Committee (PAC).

Duncan Wiggetts, ICAEW Chief Officer, Professional Standards, said: “Our role as an AML supervisor is to act in the public interest to strengthen trust in ICAEW members and firms by raising standards through a programme of continuous improvement. This year, our commitment to improvement regulation has been clearer than ever. With 9,500 firms under our supervision, we have continued to invest in proactive monitoring, thematic reviews, and targeted interventions. Our work in the anti-money laundering space is vital, not only to protect the integrity of the profession but also to safeguard the wider economy and society from the harms of financial crime. 

“We have worked closely with government, law enforcement, and other supervisory bodies to ensure our approach remains rigorous, risk-based, and responsive to emerging threats. Our regulatory model is underpinned by independence and transparency. At the same time, we recognise that regulation is not just about enforcement. It is about enabling improvement. Through education, CPD requirements and monitoring, and stakeholder engagement, we support firms and members to raise their standards and adapt to a changing landscape.”

AML Reform

ICAEW supervises 9,500 member firms in relation to money laundering. It regularly produces resources to support its supervised population, including risk bulletins, webinars, case studies and articles, as well as its award-winning anti-money laundering training film, All Too Familiar, produced in collaboration with HMRC. 

In recent days, the Treasury has revealed the outcome of its consultation on reforming anti-money laundering and counter-terrorism financing supervision, primarily for professional services, by creating a Single Professional Services Supervisor (SPSS), with the Financial Conduct Authority (FCA) taking on this new role.

Parjinder Basra, chair of the ICAEW Regulatory Board, responded to the outcome of the consultation and said: “We’re disappointed with today’s announcement of the government’s decision to take anti-money laundering supervisory responsibilities away from ICAEW and the other professional body supervisors.

“We believe that this decision will increase the regulatory burden and costs to firms, making business growth more challenging, while creating greater confusion within the regulatory framework and leading to even more fragmentation in the way key information is held and maintained about the activities of professional services firms.

“We intend to continue to engage with Ministers and HM Treasury to ensure that all of the ramifications of this decision are understood, and to suggest alternative ways forward.”

ENDS

Notes to editors:

Read ICAEW's anti-money laundering (AML) supervision report for 2024/25.

ICAEW’s role as an improvement regulator

Our mission as an improvement regulator is to strengthen trust in ICAEW Chartered Accountants and firms. We do this by enabling, evaluating and enforcing the highest standards in the profession. 

ICAEW’s regulatory and conduct roles are separated from ICAEW’s other activities so that we can monitor, support or take steps to ensure change if standards are not met. These roles are carried out by the Professional Standards Department (PSD) and overseen by the ICAEW Regulatory Board (IRB).

ICAEW’s role is to:

Authorise ICAEW firms, members and affiliates to undertake work regulated by law: audit, local audit, investment business, insolvency and probate;

Support the highest professional standards in general accountancy practice through our Practice Assurance scheme;

Provide robust anti-money laundering supervision and monitoring;

Monitor ICAEW firms and insolvency practitioners to ensure they operate correctly and to the highest standards;

Investigate complaints and hold ICAEW firms and members to account where they fall short of standards;

Respond and comment on proposed changes to the law and regulation; and

Educate through guidance and advice to help stakeholders comply with laws, regulations and professional standards.