COBS vs CASS — What's the Difference?

Published May 2026 · 7 min read

COBS and CASS are two of the most important FCA sourcebooks for anyone working in UK financial services — and two of the most heavily tested areas in the CISI UK Financial Regulation exam. They are related, they overlap in places, and candidates frequently confuse them. For a deeper dive into COBS specifically, see the Chapter 2 COBS revision guide.

What COBS Is

COBS stands for the Conduct of Business Sourcebook. It is the FCA's rulebook for how firms must conduct themselves when dealing with clients in relation to designated investment business.

Before the relationship begins

How firms communicate with prospective clients, what financial promotions must and must not say, what information must be disclosed before services are provided.

During the relationship

How clients must be categorised (Retail, Professional, or Eligible Counterparty), what suitability and appropriateness assessments are required, how orders must be handled, what best execution requires.

Ongoing obligations

How firms must report to clients, what periodic statements must contain, how to handle client complaints.

The underlying logic of COBS is that retail clients need the most protection, professional clients need less, and eligible counterparties need the least. Many COBS obligations are disapplied or modified for eligible counterparty business.

What CASS Is

CASS stands for the Client Assets Sourcebook. It governs how firms must handle money and assets that belong to clients but are held by the firm.

The core principle is simple: client money and assets must be kept separate from the firm's own money and assets at all times. If a firm becomes insolvent, client assets should be identifiable, segregated, and returnable.

CASS 6 — Custody Rules

Covers the safeguarding of client assets — shares, bonds, and other financial instruments held on behalf of clients. Firms must keep these assets segregated, maintain proper records, and conduct regular reconciliations.

CASS 7 — Client Money Rules

Covers the handling of client cash. Firms must hold client money in segregated bank accounts, clearly designated as client money, separate from the firm's own funds.

The Key Difference

COBS

How a firm behaves in its dealings with clients — what it says, assesses, recommends, and executes.

CASS

What a firm does with client property — how money and assets are held, segregated, and accounted for.

For Exam Purposes

COBS questions focus on:

—Client categorisation and opt-up/opt-down rules

—Financial promotions — permitted, approved, exempt

—Suitability vs appropriateness

—Best execution requirements

—Information disclosure obligations

CASS questions focus on:

—The segregation requirement

—Timing — how quickly must money be segregated

—Reconciliation frequency and nature

—Client assets in firm insolvency

—CASS 6 (assets) vs CASS 7 (money)

Both are heavily weighted in the exam. Chapter 2 as a whole carries approximately 35 of the 75 questions. To drill both areas with quality practice questions, MockSmith's question bank is weighted to reflect this.

MockSmith has 1,000+ practice questions across all four chapters of the UK Financial Regulation syllabus. The COBS/CASS questions are the largest section of the bank, with full explanations for every answer.

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COBS and CASS are not interchangeable, but they are complementary. For the full preparation picture, see how to pass the CISI UK Financial Regulation exam.