The Financial Adviser Standards and Ethics Authority (FASEA) has released the results for the April 2020 exam, the first done remotely, with 79% of candidates passing.
It was another decline in the passing rate, with the previous exam in February seeing a pass rate of 82%, and a total of 86% of advisers had passed the exam over the five sittings.
Held on 2-7 April, only 470 advisers sat the exam, compared to 2,231 who sat the February exam.
7,958 advisers had sat the exam to date, which represented 35% of advisers of the Australian Securities and Investment Commission’s (ASIC’s) Financial Adviser Register.
Stephen Glenfield, FASEA chief executive, said: “FASEA is pleased to present the outcomes of the fifth exam and congratulates successful candidates on completing an important component of their education requirements under the Corporations Act during the current extraordinary circumstances”.
Registrations for the June exam, which would only be held remotely on 11-16 June, had been extended until 29 May with over 2,000 advisers registered.
Registrations were still open for the August exam, which may be offered in physical locations depending on COVID-19 restrictions, as well as remote proctoring.
Over 1,200 advisers had registered so far and limitations may apply in exam centres due to social distancing requirements.
The October exam would be held on 8-13 October, with registrations opened on 6 July and November exams would be held on 5-10 November, with registration dates to be advised.
Comments
Seems like the pass rate is steadily declining. Jun-90%, Sep-88%, Dec-86%, Feb-82%, Apr-79%.
In theory the pass rate should be increasing, as people have had longer to prepare, more information has been provided, and some will be resitting. This is a concerning trend.
hi, more and more accountants are sitting the exam progressively hence the continuing increase in fail rates.
over 20,000 practicing accountants from IPA, CPA, and CA ANZ do not have a degree and were grandfathered.
Very interesting trend. I'm surprised how such a secretive exam is even allowed. Those that pass and fail have no idea how much by. The industry needs to wake up and put a stop to this nonsense exam.
Casual observation of the numbers and % of advisers who have passed vs those who have not passed combined with those who have not yet written; draws one to conclude that either an enormous number will write and pass soon, or an enormous number will exit, or they will need to pass the legislation to extend the exam deadline for 12 months. (Apologies for the long sentence.) Particularly alarming given that it takes so long to get the results that you might not get another sitting pre-December, and they give you zero feedback with your results, so its a guessing game as to where you really failed and where you did well. Just a casual observation.....
Still three sittings to go this year - June, August and October.
We will know a lot more as to what is happening in the Industry in the second half of this year once more than half of the total number on the FAR have sat the exam.
Until then everyone is just guessing.
It's pretty obvious already. I doubt many advisers who intend on remaining in this profession will have put off their exam registration beyond the next two sittings. Especially with the political uncertainty around the 12 month extension. So we are looking at about 10,000 advisers remaining. That's a 60% reduction compared to the 25,000 registered at the start of last year. Maybe we end up with a couple thousand more, who knows? But the facts are speaking for themselves and we are looking at a devastating wipe-out.
10,000 is way too optimistic. I have repeatedly said 5,000 will be left in total. you have to factor in thousands of accountants who are leaving because they either cannot pass the exam, will not do the additional study (for many its nearly 8 subjects), or think the afsl conditions are too onerous to continue to be licensed. they are just biding their time until the end date of the education requirements which are yet to be finalized, to leave.
there won't be any more than 5,000 left.
those 5,000 already have more than 1 degree
those 5,000 already have too many clients and are looking at culling their client base
those 5,000 are not going to be servicing more clients and are already increasing their fee
good luck to the consumers who need financial advice
hello ASIC, and government, this is what you wanted isn't it? NO? it doesn't matter. it's what you will be getting.
Choice? it's the advisers fault they left and refused to serve is it ?
How many accountants are actually on the Financial Advisers Register?
I get the impression it's not many. Most accountants give financial advice illegally without being licensed. They know that ASIC only enforces the law against licensed advisers, so by not being licensed they avoid both the overhead and the scrutiny.
how many have a limited license ? or authority from a dealer group limited to smsf only. i'd guess at least a few thousand
What this data actuialy says is that 21 % of existing financial advisers can't pass an exam on practical compliance, ethics and the law on their current business activities. Says to me that 1/5 advisers are cowboys. Would you want your doctor failing an exam on current medical standards ?
Trev, having passed the exam, I would suggest it was more because of exam taking ability rather than knowledge.
I wouldn't be having a go at those who didn't first go as some of the questions were very unusual.
For those who haven't done it yet, I would suggest just having a go after doing some prep around the recommended reading list. It doesn't have to be exhaustive.
I think Big_Trev there is a higher probability of the cowboys being the people that write on these forums and draw conclusions about other advisers in the absence of all of the facts. Not something that true professionals do, is it mate? Having done and passed the exam, its more likely to catch out people that might be more technical and overthink the questions, rather than simply being a "cowboy".
Agree wholeheartedly with GD. a 40 year old very ethical knowledgeable advisor that i know failed because as he admits he is "terrible at exams". Some of the greatest fraudsters in the world have been accountants and lawyers. Proof that passing an exam does not make you a more 'ethical' advisor.
in defense of accountants, who are indefensible most of the time, the greatest fraudsters ARE LAWYERS.
In the comment regarding 'some of the greatest fraudsters', I was not trying to point fingers at accountants or lawyers. Rather I was stating that passing an exam does not prove that a person is more professional or more ethical than the next person who has not passed the exam. Ethical behaviour is not based on the passing of an exam. And the FASEA exam covers much more than ethics. A successful candidate requires the ability to memorise legislation and regulations, including the privacy act, anti money laundering, disclosure documentation requirements, to name a few.
you and I are both right. the greatest fraudsters ARE LAWYERS. ask anyone who has ever used one.
I think Giggity is spot on. There will be a significant exodus. As for me passing judgement ? I passed the FASEA exam on one of the first sittings and found it not too difficult, provided you did some reading beforehand and looked at the practical application of the laws that govern our industry using the examples provided in the reading material. Memorise the Acts ? They are provided as open book content within the exam. I cannot comprehend an argument that challenges the need for an exam for existing advisers. The Royal Commission and the subsequent almost daily announcements of banning orders and fraud charges says it all. A few bad apples ? Hardly ! I don't see lawyers, doctors and accountant getting booted out or being banned anywhere near as often as advisers. This is about restoring public confidence in the industry with empirical evidence about the remaining advisers having an appropriate level of competence. Again, this is not a test for new entrants. Existing advisers dealing with individual's life savings who can't pass a test on ethics, compliance and law ? Truly scary stuff. And the comments regarding being not used to passing exams ? WTF ? Professionals who can't pass an exam ? Show me any genuine profession that doesn't use examinations to determine competence. That's the excuse kids use to use to leave school at 15. So, how are these professionals completing their CPD hours without proper assessments ? I suspect that those complaining and whinging the loudest are those who have no intention of meeting the FASEA requirements. Their "wins" are to defer and delay the implementation of the reforms so that they can continue to collect revenue. It is nothing to do with improving the industry or the quality of advice offered to consumers.
Sounds like you are trying to preach from the a higher ground? Just a tip from somebody that has also passed the exam and holds an honours degree in economics Big_Trev, true professionals don't rant about others do they? You might have passed the exam mate (which I congratulate you for), but if you think you are a professional because of that, then I think some self-reflection, especially surrounding the tone of your commentary might be needed. Your facts and figures about comparing the number of financial planners being banned vs doctors and lawyers is not completely correct and it would appear you have relied on either the media or the limited number of cases cited in the RC relative to overall adviser numbers to reach this conclusion. I am also a CA and you would be surprised about the number of CA's and accountants in general that are banned each year by the TPB. You don't hear about that because its not headline enough for the media. Sorry, but i'm calling you out here!
you tell 'em Interesting.
I can tell you as a practicing accountant myself, if you tallied the number of serious breaches by accountants each year from the three major accounting bodies CPAA, CA ANZ and IPA, (things that advisers would get banned for) they would make financial planners look like the tanned god I am.
Don't take my word for it, I dare anyone to get a copy of the latest internal magazine for CPA Australia - called In the Black or the CA ANZ - Acquity or Public Accountant, turn to the very last pages, each and every month there are at least 6 to a dozen major issues, using client funds, stealing from clients, independence issues, etc, etc for which they forfeit their membership
the only reason we do not hear about accountants and doctors and lawyers is that they keep it to the back pages of their internal magazines so as not to "bring disrepute" to the entire profession unlike the idiots in financial planning.
so, as a recognized profession, they get to keep secret their dirty laundry and ours gets aired in public for all to see by all the ass holes like ASIC, that's not how you build a profession, dickheads.
we appear to be a dirty bunch, it's just appearance, there are far more accountants and lawyers who are banned than there are financial planners. you just never hear about it because they don't get to the front page unless it's hugely egregious
like this numbskull https://www.newcastleherald.com.au/story/5095317/trusted-accountant-stol...
am i right or am i right. of course, i am right. i always am.
why don't you do us all a favour interesting since you are a ca anz member and tell us how many members were disciplined in the month of april, this might have been particularly low due to covid, i can tell you it's normally 6 to 10 each month
There is a lot there that I would agree with, but you've missed one big point. The amount of regulation/ over sight in the Accounting industry is zip. So yes congrats. If you get poor or bad advice it's "you paid too much tax...bugger". The only over sight is so long as you pay the benchmark rate of tax associated with your industry no one from the ATO is ever going to look at your records or tax /accounting advice. No one is actually going to look at the quality of that advice. It's been over 20 years that someone from CPAA came into our accounting firm. No one looks at CPD and the firm purposely ensures everyone pays the benchmark amount of tax. Accountants don't hand out documents saying if you're unhappy with the amount of tax you paid you can go to the Ombudsman and dispute my tax planning. Whilst Financial Planning, the stock market falls or the product fails so you sue the planner for poor advice, without hesitation. like I said I agree with a lot of your points, but very different from the perspective of pointing the finger when things go wrong.
I already know that. I advanced the previous posters' ideas and elaborated and gave it more definition and improved upon it.
when Alex Malley was CEO of your association CPAA awarded CPD points for watching his television interviews on channel 9, remember "in conversation with Alex Malley" .
what is even more pathetic is that CPAA is still collecting royalties from the book he co-authored "the naked CEO" btw, the disgraced former CEO, also left with a $4.9m golden handshake from a NON- profit
a truly pathetic organization.
And, just like the FPA they also offer a: "post-graduate qualification" with NO AQF designation also delivered through Deakin Uni.
most CPA's do not even have a degree and were grandfathered. for the first time in their professional lives they are finding out the meaning of what the AQF stands for.
out of the three accounting bodies I listed before, you will find the most incompetent at CPAA
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