The Financial Planning Association (FPA) has rolled out a series of business tools targetting specific areas including the terms of engagement between advisers and clients and the fiduciary duty of financial planners.
The tools are a mix of existing tools, which were previously known as practice guidelines, and newly developed procedures and have been made available ahead of Financial Services Reform Week starting next Monday in which the FPA assist advisers with applications for Australian Financial Services Licences (AFSL).
The six business tools, part of the Professional Partner Program, will cover agreements between financial planners and dealer groups, disclosure of fees and commissions, the terms of engagement, the supervision and monitoring of representatives and business risk management,
FPA acting chief executive June Smith says the tools cover concerns raised in the ASIC/ACA quality of advice survey and brings advisers up to FSR and industry standards.
Two keys areas to be covered by the tools are the financial obligations of advisers with the FPA set to releases a more comprehensive outline of these areas at this years annual conference alongside information about providing customised advice under the FSR Act.
The FPA is also heavily promoting Business Tool 4 which covers the terms of engagement between advisers and clients after the ACA survey found a mismatch between what advisers supplied and what clients needed. As such the tool will document client expectations and the level of service provided by the planner before the finnancial plan is enacted.
At present the tools are only guidelines put in place by the FPA for its membership but Smith says after feedback and further consultation with practitioner members the guidelines would be considered as part of FPA member standards and policy.
“We are looking at mechanisms to develop standards but initially these tools will provide guidance and with feedback we will move to a standard in time. The vehicle for this should follow the relaunch of the FPA’s code of ehtics in July next year,” Smith says.
According to Smith the code of conduct will be improved to come in line with the FSRA and the international Certified Financial Planner (CFP) standards but ahead of these changes the FPA is calling on dealer groups to implement the new guidelines.
“We are calling on industry champs to implement and trail these tools and are negotiating with larger dealer groups about doing so and are also working with smaller dealers in the areas of the terms of engagement for authorised representatives,” Smith says.
