What the FCA expects in a suitability report: COBS 9 and COBS 9A mapped to file checks

The suitability report is where Consumer Duty evidence is made or missed. The COBS 9 and 9A rules translate into eleven check areas — the same ones the default rubric scores.

The 11 check areas at a glance

The COBS 9 and COBS 9A foundations

COBS 9.2.1R requires a firm to take reasonable steps to ensure that a personal recommendation is suitable for the client — based on the client's needs and circumstances, their knowledge and experience, and their attitude to risk and capacity for loss. COBS 9.4.7R builds the report on top: it must explain why the recommendation is suitable (paragraph (2)) and explain possible disadvantages of the transaction (paragraph (3)). The FCA's Consumer Duty pages set out where these sit alongside the duty's outcomes.

COBS 9A mirrors that structure for advised sales of consumer investments, adding express requirements on how the recommendation is recorded. The four Consumer Duty outcomes carry the same intent — the price and value outcome (PRIN 2A.4), consumer understanding (PRIN 2A.5), and the ongoing service commitment (PRIN 2A.6), in particular, all land in the suitability report.

For ongoing advice the assessment is not a point-of-sale event. The annual review re-tests the recommendation against the client's current circumstances, and the file records that re-test — what was checked, what changed, and what was confirmed. The eleven checks apply to the file in its current state, which is why a review that only restates last year's wording fails the same checks an empty file fails.

• Suitability reasoning

  COBS 9.4.7R(2) / COBS 9A.3.3R(1)(a)

  The report explains why the recommendation is suitable for this client, not boilerplate.

• Client circumstances

  COBS 9.2.1R / COBS 9A.3.3R(1)(b)

  The client's actual circumstances, objectives, and risk tolerance are obtained and reflected.

• Vulnerability assessment

  FG21/1

  Vulnerability is considered and documented — or explicitly ruled out, with why.

• Cost disclosure

  PRIN 2A.4 / COBS 9.4.7R(2)

  Charges and their impact on returns are disclosed so the client can understand the cost.

• Product alternatives

  COBS 9.4.7R(2) / FG12/16

  Alternatives are named and the reasons for rejection documented.

• Risk disclosure

  COBS 9.4.7R(2) / Principle 7

  Key risks are communicated clearly, fairly, and understandably.

• Transaction disadvantages

  COBS 9.4.7R(3)

  Possible disadvantages of the transaction are explained, including lost benefits or penalties.

• Consumer understanding

  PRIN 2A.5

  The report is written in plain language the client can follow.

• Ongoing service commitment

  PRIN 2A.6 / COBS 9A.3.3R(2)

  The ongoing service, review frequency, and next review date are stated.

• Capacity for loss

  COBS 9.2.2R / COBS 9A.3.3R(1)(b)(iii)

  The client's ability to bear losses is addressed against their circumstances.

• Tax efficiency

  COBS 9.2.1R / COBS 9.4.7R(2)

  Tax implications are considered and documented, including wrappers used.

These are the checks a file review scores. A report that clears all eleven is a report that answers the FCA's evidence question before it is asked.

Where the eleven checks come from

Each check area maps to the rules above: suitability reasoning to COBS 9.4.7R(2), client circumstances and knowledge and experience to COBS 9.2.1R, capacity for loss to COBS 9.2.2R, transaction disadvantages to COBS 9.4.7R(3), and the Consumer Duty outcomes to PRIN 2A.4 to 2A.6. Vulnerability is covered by FG21/1, the FCA's finalised guidance on the fair treatment of vulnerable customers. The Consumer Duty publications library collects the good- and poor-practice examples that show what each check looks like when it is done well.

The FCA reads files cold. Its enforcement lessons, set out in the Enforcement Watch series, keep returning to reports that asserted suitability without carrying the evidence for it. The eleven checks are the reviewer's scoring grid for that evidence.

Worked example: the report that answers the evidence question

One recommendation, two reports. Anonymised and illustrative.

Most failing files sit between the two — an amber, not a fail: the vulnerability line is there but the characteristics are not listed; charges are shown but their impact is not; alternatives are named but the rejection is not explained. Amber is fix-before-ship, and a file that ships amber records the reason alongside the score.

Common mistakes across the eleven

• Boilerplate reasoning. A rationale that would fit any client fails suitability reasoning even when the recommendation is right.
• Vulnerability missing. The single most common miss — a file with no consideration line reads as no consideration at all.
• Alternatives absent. A recommendation with no named alternative and no reason for the choice cannot support the “why this one” question.
• Capacity inferred from attitude to risk. Willingness and ability are different; the file must address both (COBS 9.2.2R).
• Charges without impact. Costs disclosed as numbers with no effect on returns shown, so the price and value outcome is left unanswered.

The eleven at a glance

How the eleven read in a cold review

A reviewer scores each check Pass, Amber or Fail against the file — not against what the adviser remembers. Pass means the evidence is there and reasoned; amber means it is thin enough to need a second look; fail means it is missing. The amber list is where the review finds its work: the fixes that make a file demonstrable.

The same grid is what a firm's own review, a compliance consultant, and an FCA information request all use in effect — the questions are the same because the expectations are. Keeping one mapping means the file answers those questions once, consistently, and the results across advisers and quarters can be compared — which is what turns file review into outcomes monitoring rather than a scatter of individual reads.

Proportionality shapes how each check is evidenced, not which checks run. A one-adviser firm files a shorter rationale for a simple product; the check that the rationale exists and is reasoned does not change. The grid keeps the standard fixed while the depth scales with the client and the product.

Related reads

This mapping is the rulebook for the file review and suitability hub. Turn it into action with the 12-point pre-send checklist, lay the report out with the 12-section report anatomy, and keep the file current with the annual review process.

Your next step

Map your current report template to the eleven checks and score one recent file against it — the gaps will show up as empty cells. Proven Duty reviews files against this same set and returns the per-check output, so the evidence builds with every report. Start a free trial or see pricing.

Sources

• COBS 9.2 (FCA Handbook)
• COBS 9.4 (FCA Handbook)
• COBS 9A.3 (FCA Handbook)
• PRIN 2A.4 — The price and value outcome (FCA Handbook)
• PRIN 2A.5 — The consumer understanding outcome (FCA Handbook)
• PRIN 2A.6 — The consumer support outcome (FCA Handbook)
• FG21/1 — Guidance for firms on the fair treatment of vulnerable customers (FCA)
• FG12/16 — Assessing suitability: replacement business and centralised investment propositions (FCA)