Core Viewpoint - The Financial Conduct Authority (FCA) proposes an industry-wide redress scheme for UK motor finance customers who may have been unfairly charged due to inadequate disclosure of commission arrangements between lenders and brokers, covering agreements from 6 April 2007 to 1 November 2024 [1] Group 1: Redress Provisioning - The compensation scheme will have accounting implications for lenders, particularly in terms of redress provisioning, as clarified by the FCA's consultation paper on Discretionary Commission Arrangements (DCAs) [2] - Affected lenders must assess their positions regarding provisions, with those lacking a provision needing to calculate one using the proposed redress methodology, while those with existing provisions should reassess them [3] Group 2: Going Concern and Financial Impact - The inclusion of a redress provision may impact the going concern status of affected lenders, as it will reduce current profits and affect future cash flows, necessitating adjustments in future cash flow forecasts [4] - The conditions for recognizing a redress provision include having an obligation due to past events, the probability of needing to transfer economic benefits, and the ability to estimate the obligation reliably, all of which are satisfied according to the FCA's proposed methodology [5]