FCA Financial Projections: What to Submit for Authorisation

The FCA expects every applicant for authorisation to submit realistic financial projections that show the firm will have, and keep, adequate financial resources. In practice that means a forecast income statement, balance sheet and cash flow statement, built on documented assumptions and prepared on the FCA's template for your type of firm.

What financial information does the FCA require?

The FCA's guide Preparing your firm's financial information sets out the baseline:

• Statements: an income statement, a balance sheet and a cash flow statement.
• Forecasts: required for all firms before the FCA can assess the application. Three years in Excel is best practice, and monthly or yearly projections are both accepted.
• Historical accounts: required if the firm is already incorporated and in business, with three years as best practice.
• Notes and assumptions: notes to the accounts and the key assumptions behind the forward-looking business plan, such as management information or board packs.
• Whole entity only: the information must match the applicant entity. The FCA will not accept figures that cover only part of the legal entity.
• Prudential material: firms subject to a quantified prudential regime should include share capital details and term sheets for capital-enhancing instruments, which the FCA will verify.
• Templates: use the correct sector-specific Excel template, using the Guidance and Glossary tab to choose it. The FCA offers templates for wholesale firms and certain consumer investment firms, financial advisers, payments, e-money and cryptoasset firms, mortgage brokers (added in November 2025) and all other retail firms. Other items, such as capital requirements, cash flow statements or stress testing, can be submitted in your own format.

The business plan's capitalisation section must be consistent with these figures. See our guide to writing an FCA business plan.

Does the FCA require a 12-month or a three-year forecast?

It depends on the form you are completing, and this is a common source of confusion. The general FCA guide sets three years as best practice. Some application notes are more specific. The FCA's notes for the full consumer credit application (release 5, November 2023) ask every applicant for:

The practical answer is to follow the form for your firm type and meet its minimum, then extend to a three-year view if the FCA's general guide applies, as it is the stated best practice. A longer view also helps you test how the firm funds growth and whether capital remains adequate after year one. If you are applying as a credit broker, our credit broking guide covers the application route.

How the FCA assesses whether your financial resources are adequate

Financial projections are evidence for a threshold condition. COND 2.4, appropriate resources, asks whether a firm's resources are appropriate to the regulated activities it carries on or seeks to carry on. The FCA reads "appropriate" as sufficient in quantity, quality and availability, and resources include capital, provisions and liquid assets as well as people and risk management tools. Factors in COND 2.4.4G include:

• indications of difficulty complying with prudential rules, or of inability to meet debts as they fall due;
• whether the firm has made enquiries enough to show it has access to adequate capital, including to cover start-up losses, and that client money, deposits and custody assets are protected if the business fails; and
• whether resources match the likely risks.

The FCA's guide adds that firms must assess whether their financial resources are proportionate to the risk and complexity of their business, and it considers whether the firm has enough assets to cover debts and liabilities, plus profitability, capital and liquidity. It links to the FCA's guidance on assessing adequate financial resources, FG20/1. That guidance says adequate resources let firms operate and provide services through the economic cycle and allow an orderly wind-down without undue harm to consumers.

Some firms must also submit a wind-down plan. The FCA's guide expects it to account for inflows (which are likely to fall after a trigger event), ordinary outflows, and extraordinary outflows such as closure costs, professional fees, redundancy and lease termination. Check your sector page to see whether it applies to you.

How to build credible projections

1. Start from the business model. Revenue lines should map to the regulated activities and permissions in your plan. If a line cannot be explained in the plan, it should not be in the model.
2. Be realistic about revenue. Base volumes on evidence such as pipeline, pricing, conversion and existing relationships. Showing steady growth with documented drivers is more convincing than an optimistic ramp. Where possible, keep regulated and unregulated income apart, as the consumer credit notes require.
3. Cost the set-up properly. Include legal, compliance, systems and recruitment costs, and the FCA application fee, in the opening position. Those costs and any forecast losses reduce capital before you start trading.
4. Show capital at authorisation and through the forecast. Demonstrate how you meet your capital resource requirement from day one and in each period, including during start-up losses. Allow headroom above the requirement. The FCA sources we checked do not set a buffer size, so size yours through your own stress testing and write down the reasoning.
5. Evidence the funding. The FCA's September 2025 good and poor practice report favours firms that set out funding arrangements, highlight funding commitments and include contingency plans. Smaller firms can use evidence such as bank statements.
6. Write the assumptions. Notes and assumptions are part of the requirement, not an extra. Each driver should be traceable.
7. Run checks before submission. The FCA flags balance sheets that do not balance and opening and closing balances that fail to reconcile across years. Make sure the model reconciles and agrees with the business plan and the application forms.

Common mistakes the FCA sees

The FCA's good and poor practice report (September 2025) lists these weaknesses on financial projections and resources:

• failing to submit historic financial accounts with the initial application, which delays assessment;
• submitting inaccurate information, which hinders assessment and leads to further information requests; and
• omitting information needed to verify the firm holds the financial resources required by prudential rules.

Good practice includes using the FCA's financial analysis templates, giving notes and assumptions, and setting out funding and contingency plans. Missing financial information delays assessment, and an incomplete application can take up to twelve months rather than the usual six for a complete FSMA application.

Budgeting the application itself

The application fee is paid when you apply. The FCA says it is refunded if the application is rejected for missing minimum information, but not if you withdraw or are refused. Use our FCA fees calculator and the authorisation cost guide to estimate fees and ongoing costs for your model.

How MEMA can help

MEMA helps applicants build projections that reconcile to their business plan and stand up to a case officer's questions. See our FCA authorisation service or use the authorisation checklist to check readiness.