ASIC and APRA move to streamline FAR

ASIC and APRA have begun consultation on proposed changes to the Financial Accountability Regime (FAR), with the regulators estimating the reforms could reduce reporting requirements for all accountable entities and about 4500 accountable people.

The proposed changes would remove key function requirements for the FAR regulator rules and no longer require accountable entities to include information about accountable persons' direct reports in accountability maps.

The regulators said the changes are intended to reduce administrative burden while retaining the information needed to oversee the regime, with the number of required updates to accountability maps expected to be halved.

APRA deputy chair Therese McCarthy Hockey said the consultation formed part of the prudential regulator's broader effort to reduce unnecessary regulatory burden without compromising financial safety and stability.

"These proposed changes maintain strong accountability settings while minimising reporting requirements and supporting efficiency and productivity. They will allow entities to spend less time on administration and more time running their businesses," McCarthy Hockey said.

ASIC commissioner Alan Kirkland said the proposals reflected the corporate regulator's ongoing focus on simplifying regulatory processes.

"We continue to explore opportunities to streamline the way entities deal with us in the areas we regulate," Kirkland said.

He said the changes would reduce reporting requirements while preserving the accountability standards expected across the financial services sector.

"The proposed changes to FAR reporting will simplify reporting without undermining the strong accountability standards that Australians expect from their banks, superannuation funds and insurers," Kirkland said.

The FAR, which established accountability obligations for senior executives and financial institutions, applies across the banking, insurance and superannuation sectors.

The consultation comes as regulators continue to balance stronger individual accountability with the administrative requirements imposed on regulated entities.

Subject to feedback received during the consultation, ASIC and APA intend to finalise the proposed changes by the end of 2026, with the reforms to take effect from 2027.