FASEA exam acknowledged as a culling mechanism

The Association of Financial Advisers (AFA) has acknowledged that the financial adviser exam set by the Financial Adviser Standards and Ethics Authority (FASEA) will act as a culling mechanism for advisers who are “fundamentally inadequate” but has urged that advisers be given more time to prepare.

As well, the AFA has urged the adoption of a special provision for a minimum of six months transition to allow advisers who fail the exam to arrangement the sale of their businesses or transfer their clients to another adviser.

In a submission recently filed with FASEA the AFA said it supported the need for an examination to confirm all ongoing advisers had an acceptable understanding of the core requirements of being financial advisers.

Related News:

“We also envisaged that it was a mechanism that would remove those who are fundamentally inadequate and that this was something that was in the best interests of their clients, the community and the financial advice profession as a whole,” the AFA submission said.

However, it warned that some financial advisers, particularly older advisers, might not have sat exams for years and might find the exercise challenging, and in these circumstances it would be important for FASEA and others to assist advisers for sitting the exam.

The AFA submission said that the proposed time-frame for the exam was short and reliant on everything having been built and available before the middle of 2019.

“We believe that FASEA and the Government should look at potential solutions to address this problem and provide advisers with more time to study in preparation for undertaking the exam,” it said.

“There will be particularly significant consequences for advisers that are unable to successfully pass the exam within the required timeframe,” the submission said. “They may be in a position where they sit the exam and are awaiting the final outcome, yet get the news in December 2020 that they have still not passed the exam. This would virtually result in an immediate need for them to cease operating. This would work to the disadvantage of their clients who would be left without an adviser at such short notice.”

Recommended for you




Govt seems to be putting the cart before the horse. Coming up with all of these strict dates before they have the material complied and distributed. The study material needs to be available a minimum of 6 months prior to the first opportunity to write an exam. And yes, a lot of older planners will struggle in an exam setting. A year after the fall out, there will be some outcry that there is not enough older experienced planners to serve the demand of retirees. Looks like the only fully qualified advisers will be recent graduates. Not all 65 year old's want to get their advice from a 25 year old who still lives at home.

Crazy that they want higher education but give the test before the new education is done. Remind me why we have to complete the new education requirements if we pass this test then? yeah good luck to the people receiving financial advice sorry I mean general information from their age care representative ripping people off

The 'culled' advisers won't be limited to older, poorly educated advisers. There will be young, highly educated advisers who will also fall victim to this draconian exam. If you fail more than twice, you will be banned from your profession and if you have a business, you will be forced to sell it at fire sale value. How's that for pressure!!! We are human beings, there will be a mental health crisis, no doubt about it. There needs to be a back up plan, where advisers who fail exam modules can satisfy FASEA by completing a course. But given the 2 year window has already commenced and FASEA, after 18 months, have not even drafted a practice exam or released the study materials, this is an impending disaster.

This process has been a strategic, ruthless and manufactured assassination designed for maximum effect.
The "collateral damage" will not only be the deletion of many effective and experienced advisers who have clients rely on the relationship formed over many years, but it will be the clients themselves.
The Liberal Party's treatment of financial advisers through ASIC 413 Report, LIF and now FASEA has been nothing short of a what a power drunk Labor Party would do....it is simply a disgrace.
If the Liberal Party want to preserve any form of respect and support from tens of thousands of voters at the next election, then they had better act fast and act now.

Agree with your view.

Turnbull tried getting into the Labor party initially but was supposedly rejected. Pretty sure he was in fact given an undercover operative role (like the Russian moles in the cold war) and tasked with gaining power and then 'Laborizing' everything from within the Lib ranks!! Wild theory perhaps but nothing short of him and his cronies being mentally incompetent makes sense. Hindenburg, sorry my mistake, Fryndenburg shows almost as little aptitude or care as his impaired predecessor O'Dwyer.

Fabian Society

Frydenburg has no appetite for anything that may appear to go against them politically from the public's perception.
The issue is that the vast majority of the public who actually get off their arse and seek and receive quality advice are in a better position from an education perspective regarding their superannuation and retirement and from a financial risk perspective and hence will make better and informed decisions.
Frydenburg is only interested in one thing only and that is the top job one day.....anything that makes him enemies he will not entertain and doesn't have the courage to push forward or against the maligned and manipulated position his own party have taken against the financial services space.
It is entirely ridiculous that a Real Estate Agent can sell a property in 2 days for $3 Mill and have advertised it as an
"ideal investment opportunity" (compared to what ?????) and earn a level of commission that would not and could never be justified in the provision of financial services.
It is entirely unbalanced.

Turnbull - The Sydneian, No. 369, November 1972, p. 13. “As one who has done his share of ‘system-bucking’, and then become part of that system, I can confidently say that much of the conservatism of the ‘establishment’ is the direct result of non-cooperation on the part of the boys … I am arguing a somewhat Fabian line when I say that the best way to change things is not through confronting the system head on — because in a confrontation it must win — but by working with and within the system to promote change.”

I have to say I will be not be voting for any of the Liberal, labor and Greens, at this election.

I agree with don't vote for any of them but it is a preferential voting system, it will come back to the two majors anyway. You don't matter. You are forced to vote in an extreme manner, even if you don't believe in them and this only makes the politics worse, or vote for none and go informal vote. It is a deliberate strategy to get what they want anyway.

You are probably correct, but it is the only way to send a message that they are not what I want to see running the country. I get so tired of listening to politicians say "Our opponents .....". Somehow we seem stuck with a school debating team approach. They are elected to properly run the country, not debate opponents, and certainly not raise money for more bureaucracy.

Speak for yourselves I’m in my 50s and think all of you forget that we have to sit mink exams for our CPD. So I am not worried about sitting this exam because I am older and it certainly won’t push out all older advisors only the incompetent ones.

But I do have to admit they need to extend the deadlines for the exam because they have only just picked a provider of this exam and I imagine it will take them at least 1 year to properly create study materials, practice materials and the exam.

Add new comment