FRAME reporting: the control decisions behind CP26/26

At a Glance

The FCA has proposed a new Fund Reporting for Asset Management Entities (FRAME) framework to consolidate current fund reporting requirements, with essential and enhanced reporting tiers based on a £500m NAV threshold.

The proposal would replace product-specific returns with consolidated templates intended to improve data consistency while reducing reporting for many smaller funds. The FCA estimates net annual savings of £110.98m industry-wide, with AIFMs seeing £147.8m in reduced costs offset by £19.6m in new UCITS reporting obligations.

Asset managers should assess how the proposed essential/enhanced reporting tiers would apply to their fund portfolios, particularly the NAV-based thresholds and transitional provisions. The FCA has published prototype templates and invites voluntary testing ahead of planned 2028 implementation.

What the FCA Is Proposing

Tiered reporting by fund size

The FCA proposes essential reporting for funds under £500m NAV and enhanced requirements above this threshold, affecting 90% of the 21,684 AIFs currently reported. This NAV-based approach means large managers with mixed-size funds would apply different requirements across their portfolio, with optional opt-up to enhanced reporting for smaller funds anticipating growth.

Simplified leverage reporting

The consultation proposes eliminating complex gross/commitment method leverage calculations in favour of simpler exposure metrics aligned with IOSCO recommendations. For essential reporting, only leveraged funds and hedge funds would complete counterparty exposure sections, while enhanced reporting captures more granular data on borrowing sources and collateral.

Variable reporting timelines

Proposed submission lags range from 30 days for UCITS to 120 days for most unauthorised AIFs, with hedge funds subject to 45-day deadlines. Quarterly reporting would apply to UCITS and hedge funds, while other AIFs report annually, with a two-quarter cushion before new requirements take effect after threshold crossings.

Who Should Read This Consultation

The FCA says the proposal would cover FCA-authorised UK AIFMs, RVECA and SEF managers, UK UCITS management companies, third-country AIFMs marketing under the NPPR, operators of recognised and collective investment schemes, and some MiFID investment managers and advisers. Service providers to these firms and funds may also wish to respond.

MEMA recommends using the FCA's stated audience to document why the consultation is relevant to the firm's permissions, activities or service-provider relationships, without treating consultation readership as the final scope of rules that have not yet been made.

Questions Firms Should Resolve

MEMA recommends that firms map their current reporting obligations against the proposed FRAME templates to identify data gaps, particularly for UCITS managers facing new requirements. The essential/enhanced threshold analysis requires NAV monitoring systems capable of triggering reporting tier changes, with optional opt-up provisions adding operational complexity for firms preferring consistent reporting across all funds. For Fund Reporting for Asset Management Entities (FRAME), MEMA recommends testing the scope assessment against the firm's permissions, products, governance arrangements, legal entities and group relationships. Before committing implementation spend, owners should map Fund Reporting for Asset Management Entities (FRAME) to policies, decision rights, data, systems and material third parties.

The proposed leverage reporting changes may require validation of alternative methodologies, though the FCA has not specified technical standards. Asset managers using complex derivative strategies should assess whether the simplified exposure metrics would adequately represent their risk profiles or necessitate supplementary disclosures under the enhanced requirements. The working paper should separate what CP26/26 actually proposes from management assumptions, record unresolved interpretations and identify the evidence required before any change is approved.

Decisions Before the Consultation Closes

MEMA Assessment

The FRAME consultation represents a fundamental shift from product-specific reporting to a consolidated framework, requiring boards to approve resource allocation for system changes ahead of the proposed 2028 implementation. Directors should request analysis of how the £500m NAV threshold would apply to current and pipeline funds, including the operational impact of monitoring for tier transitions and the strategic implications of opt-up decisions. MEMA's view is that the board should receive a concise decision paper on Fund Reporting for Asset Management Entities (FRAME), rather than a generic regulatory update.

While the FCA estimates net cost savings, boards should scrutinise the £139.8m industry-wide implementation costs against their own transformation budgets. The proposed leverage reporting changes may reduce compliance burdens but require validation that simpler metrics meet risk management needs, particularly for funds using complex strategies that currently rely on gross/commitment method calculations.

Source Evidence

Plain English Glossary

• CP - Consultation Paper. FCA publication setting out proposed rule changes and inviting feedback from industry and the public.

Disclaimer

This article is for general information only and does not constitute legal or regulatory advice. Firms should assess the application of regulatory requirements by reference to their permissions, products, customers and operating model.

How MEMA Can Help

MEMA can help firms translate regulatory change into practical controls, policies, monitoring activity and board evidence. Book a free scoping call to discuss what this development means for your firm.

MEMA can provide ongoing FCA compliance support for firms reviewing how the development affects their permissions, products and operating model.

For the broader supervisory context, read our assessment of the FCA's 2026 compliance priorities.