Advisers can continue as business owners without FASEA requirement
Advisers who do not sit the Financial Adviser Standards and Ethics Authority (FASEA) exam by the end of the year have an opportunity to stay in the industry by being business owners, according to Sequoia Financial Group.
Michael Butler, head of advice and compliance at Sequoia, said that it was important to recognise that there would be some advisers who were not ready to take on the amount of study and continue in their role while their clients would continue to need the services.
“We are trying to work with our advisers and we recognise that there is a number of advisers who, for one reason or another, will not sit the exam, even though this is in the minority,” he said.
“We believe that the need for providing advice is only going to grow and we are looking to work with those advisers who don’t want to go on in the advice but who have a successful business, either an accounting or financial planning business, for them to be owners and for those businesses to generate the sufficient income to actually employ an adviser to work within that business because otherwise we won’t be able to service the clients who need advice.
Butler stressed that the current ongoing changes within the industry were going to impact those clients who could least afford to be impacted such as mums and dads who really need advice.
“We are working to keep our practice numbers up so that we service such clients,” he added.
Commenting on the adviser numbers within the group, Butler pointed out that it was unfortunate that the professional year requirements came to the industry at the same time as the big institutions were on their way out.
“They were probably in the best place to run these programs, but now groups like ourselves will have to step in,” he said.
“We are putting in place programs to meet the professional year requirement but it’s only a small program at the moment because there is not a lot of demand for it but there is a programme that would be able to ramp up as it is required when there will be a need for graduates to come through.
Butler said that for now there were still numbers of people who had been forced out from institutions and were already qualified but this situation would change over the next couple of years.
AUTHOR
Oksana Patron
Recommended for you
AZ NGA has entered into a strategic partnership with national advice firm MiQ Private Wealth, as a way to provide a succession solution, as well as career development opportunities for staff.
While the advice profession struggles under growing operating costs, Adviser Ratings has found more than half of practices – some 58 per cent – that generate less than $250,000 in revenue report no profit at all.
The Federal Court has ordered the freezing of assets and the appointment of receivers to two entities linked to Australian Fiduciaries, ASIC’s latest move in an ongoing investigation into the company’s managed investment schemes.
Off the back of the August adviser exam results, the profession has seen 17 new entrants hit the Financial Adviser Register (FAR) this week, helping numbers return to positive territory.
