{"id":14592,"date":"2026-10-26T15:52:52","date_gmt":"2026-10-26T05:52:52","guid":{"rendered":"https:\/\/namescan.io\/insights\/?p=14592"},"modified":"2026-10-26T15:52:52","modified_gmt":"2026-10-26T05:52:52","slug":"insights-amlctf-independent-evaluation-small-firms","status":"publish","type":"post","link":"https:\/\/namescan.io\/insights\/insights-amlctf-independent-evaluation-small-firms\/","title":{"rendered":"How Small Firms Should Prepare for an AML\/CTF Independent Evaluation"},"content":{"rendered":"

Under Australia’s reformed AML\/CTF regime, your entire AML\/CTF program, meaning your risk assessment and your AML\/CTF policies, must be independently evaluated at least once every three years, at a frequency your policies set. For newly regulated Tranche 2 businesses, the first independent evaluation is due between 30 June 2029 and 31 December 2030, depending on the last two digits of your AUSTRAC account number<\/a><\/strong><\/p>\n

This guide explains what an independent evaluation is, how to work out your first deadline, who can carry it out, what happens with the report and how a small firm can prepare. It is general information, not legal advice.<\/p>\n

What an independent evaluation is<\/h2>\n

The reforms replaced the old independent review of Part A of an AML\/CTF program with an independent evaluation of the whole program. AUSTRAC is clear that it sits alongside, not instead of, your own reviews. You must still review your risk assessment and your AML\/CTF policies at least once every three years, and sooner in some circumstances.<\/p>\n

Your AML\/CTF policies must set out how often independent evaluations happen and how they are conducted. At a minimum, AUSTRAC says an evaluation must occur at least once every three years.<\/p>\n

When your first evaluation is due<\/h2>\n

AUSTRAC’s guidance on the AML\/CTF Transitional Rules 2026 sets staggered first deadlines for newly regulated businesses, based on your AUSTRAC account number (AAN):<\/p>\n

\"Table<\/p>\n

AUSTRAC suggests newly enrolled businesses may wish to carry out their first evaluation earlier rather than waiting for the deadline, so that major issues are found and fixed sooner and while suitable evaluators may be easier to find. Update your AML\/CTF program so that your evaluation schedule matches your deadline.<\/p>\n

Who can carry out the evaluation<\/h2>\n

AUSTRAC says an evaluator can be internal, such as a member of an internal audit team, or external to your organisation, as long as they are sufficiently independent. It expects the evaluator to be empowered to conduct the evaluation as they see fit, and gives the example that the evaluator should not be your AML\/CTF compliance officer or a member of the compliance team.<\/p>\n

For most small firms, that points to an external evaluator. In a two-person practice where one principal designed the program and the other runs it, neither is likely to be independent of it. Whoever you choose, record why you consider them independent and suitably skilled.<\/p>\n

GETTING READY FOR AN INDEPENDENT EVALUATION<\/strong><\/p>\n

Preparation starts long before the evaluator arrives.<\/em><\/p>\n

\"Five-stepFigure 1. Illustrative preparation timeline for a small firm’s first independent evaluation.<\/em><\/p>\n

What the evaluator will need<\/h2>\n

AUSTRAC expects you to give the evaluator access to documents, key personnel and systems. For a small firm, that usually means having these ready:<\/p>\n