ESMA launches CSA on internal audit functions of UCITS and AIFMs

What’s new?

On 14 February 2025, ESMA, together with the NCAs, launched an EU-wide common supervisory action (CSA), focusing on compliance and internal audit functions of UCITS management companies and AIFMs throughout the EU.

What does the CSA cover?

ESMA’s aim is to assess compliance with EU laws and determine the extent to which UCITS ManCos and AIFMs have implemented effective compliance and internal audit functions.

This will include consideration of whether they have:

• adequate staffing, authority, knowledge and expertise to perform their duties under the AIFM and UCITS Directive.

The CSA will focus on compliance and internal audit functions that are designed to ensure internal control mechanisms:

• monitor, identify, measure, and mitigate any possible risks of non-compliance with the rules of the relevant jurisdiction.

A common assessment framework, developed by ESMA, which sets out the scope, methodology, supervisory expectations, and timeline, will guide NCAs in conducting actions within their respective jurisdictions, in accordance with the relevant provisions of the AIFMD and UCITS Directive.

Next Steps

Over the course of the year, NCAs will collaborate through ESMA to share knowledge and experiences, to better understand how they supervise the compliance of UCITS management companies and AIFMs.

ESMA aims to publish a final report with the results of the CSA in 2026.