If you are an ICAS licensed Insolvency Practitioner, Insolvency Monitoring's publication "A Guide to Your Insolvency Monitoring Visit" can be found in the members section. The visit booklet provides a more detailed explanation of the visit process.
Who is required to receive an ICAS Insolvency Monitoring Visit?
All insolvency practitioners who take insolvency appointments require to receive a monitoring visit.
In addition to conducting Monitoring of its own licensed insolvency practitioners, ICAS also conducts all of the insolvency Monitoring on behalf of the Chartered Accountants Regulatory Board (CARB) of the Institute of Chartered Accountants of Ireland.
How often are Insolvency Monitoring visits conducted?
ICAS has completed five rounds (or cycles) of Monitoring and commenced its sixth round of Monitoring on 1 January 2012. This cycle is a three year monitoring cycle (i.e. all insolvency practitioners who take insolvency appointments must be visited at least once in every three years) and is due to be completed by 31 December 2014.
Prior to 2009, the fourth round of Monitoring operated on a six year cycle. ICAS has, therefore, recently doubled its monitoring effort.
If an Insolvency Practitioner receives an unsatisfactory report the ICAS Insolvency Permit Committee ("the Committee") may also instruct that a follow-up visit be conducted, with the cost of this visit being borne by the Insolvency Practitioner.
Practitioners who have recently been authorised and are not part of a larger organisation will receive an early first visit.
How are Insolvency Practitioners selected for a visit?
The actual timing of the Monitoring visit will depends on risk, based on assessment of:
- the timing and outcome of past Monitoring visits;
- information from the Annual Application for an Insolvency permit; and
- information from other sources (e.g. monthly bordereaux, complaints, in-house database).
If the Committee has requested a visit (for example, as a result of a complaint, or a follow up visit to follow up on a previous unsatisfactory Monitoring visit) then the Insolvency Practitioner will usually be informed of this.
How are Insolvency Practitioners notified of the visit?
A notification letter, including the proposed date of the Monitoring visit and the name of the reviewer, will be sent to the Insolvency Practitioner, giving at least six weeks notice.
The Insolvency Manager should be notified immediately of any objections to the date of visit or the named monitor and the request will be considered.
In addition to the visit notification letter, each insolvency Practitioner will receive a Pre Visit Questionnaire (PVQ) which is available in the members area . Insolvency Practitioners are requested to submit the PVQ and certain supporting documentation 6 weeks month before the visit, to enable the Monitor to consider the Insolvency Practitioner's procedures prior to attending the visit and will also enable initial case selection in advance of the visit.
What is the visit process?
Before the on-site visit
The Monitor will telephone the Insolvency Practitioner approximately one week before the visit to confirm the arrangements for the visit. Any urgent queries before the pre visit call can be answered by the Insolvency Manager on 0131 347 0288.
Opening Meeting
An initial meeting will be held with the Insolvency Practitioner (and possibly with other compliance staff) with the purpose of enabling the Monitor to understand the insolvency practice and to assess the risks that will require to be addressed during the visit.
Fieldwork
The Monitor will conduct risk based case selection. The number and extent of files reviewed will vary with each visit. The Monitor will pass his/her written findings on each case reviewed to the Insolvency Practitioner who will respond to the points in writing. Each case will then be discussed between the Insolvency Practitioner and the Monitor in detail, in order to obtain agreement on the main file findings.
In addition to the review of the case files, the Monitor will review the systems and procedures used in administering the insolvency cases and other matters (for example: clients monies compliance, anti money laundering, CPD).
Closing Meeting
When the fieldwork has been completed, the Monitor will then draw together the findings.
If issues or shortcomings are identified, the Monitor will assess how the Insolvency Practitioner has dealt with the problems, or if they have not yet been dealt with, will try to find the underlying causes, and then seek his/her action plan and initial responses. The Monitor will seek to be helpful and may make suggestions and provide advice on suitable remedial action.
What is the process after the visit?
The Monitor completes the visit file and writes the final report. Every visit file is then reviewed as part of ICAS' internal review procedures, to ensure that all insolvency practitioners are treated correctly, and in accordance with our monitoring procedures.
Insolvency Monitoring has a target of 20 business days from the date of the closing meeting in which to submit the final report to the Insolvency Practitioner. Upon receipt of the report the Insolvency Practitioner will have 14 days in which to respond with his/her comments. The report and the Insolvency Practitioner's comments will be placed before the next Committee meeting for its consideration.
What happens after the visit?
When the Insolvency Practitioner will hear about the outcome of the visit will depend on whether there is anything to follow up on post visit or if the insolvency permit will continue without any additional information being provided to the Committee .
The Committee only meets every two months, so it may be some time before the Insolvency Practitioner hears the outcome.
Any concerns about the delay in hearing back after a visit should be referred to Insolvency Manager on 0131 347 0288 or cmorris@icas.org.uk .
Further Submissions
Some visits require further information, and the Insolvency Practitioner may be asked for some further submissions to evidence improvements made or actions taken e.g. CPD records. In which case the Committee writes to the Insolvency Practitioner requesting that such information is submitted by a specified deadline.
Once the Committee is satisfied with all the information submitted, the Insolvency Practitioner will be notified that the visit is completed.
Where follow-up action is required
The Committee may decide because there are serious matters or areas that give cause for concern in the report that further action is required by the Insolvency Practitioner. In these circumstances, the Insolvency Practitioner will be advised in writing of the committee's decision.
Further action imposed by the IPC could include, for example:
- instructing the Monitor to carry out a follow-up visit;
- asking the Insolvency Practitioner to attend a sub committee meeting to explain the findings and your action plan directly to the Committee;
- asking the Insolvency Practitioner to supply further information to show that proposed actions were successful;
- restrictions being imposed e.g. the Insolvency Practitioner may be restricted from accepting new insolvency appointments; or
- in very serious cases, the insolvency licence could be suspended or even withdrawn.
The Committee has the power to withdraw an insolvency permit, and consequently as an RPB, is required to notify The Insolvency Service of its actions.
If it believes that the public interest would be best served by publication, the Committee may publish, in such manner as it sees fit, decisions to withdraw Insolvency Permits as per the Insolvency Permit Bye-laws.
If the Insolvency Practitioner is not happy with the decision taken, there is a hearing and appeal procedure. If appropriate, details will be sent with the Committee's decision letter. The Insolvency Practitioner has the opportunity to appear before the Committee and be legally represented.