CFS and the value of not providing holistic advice
Colonial First State (CFS) spent $5,500,410.68 delivering intrafund advice in 2019, with an average cost to members of its superannuation funds of $20.71.
This was down slightly on its experience in 2018 when it spent $6,289,062.69 on intrafund advice, at an average cost to members of $22.09 each.
Yet, according to evidence delivered by CFS to the House of Representatives Standing Committee on Economics it did not provide comprehensive advice over the period and did not employ financial planners.
This, of course, overlooked the relationship between CFS and the Commonwealth Bank and the role played by the CFS platforms.
The CFS answers to questions on notice from the committee stated: “Colonial First State Investments Limited (CFSIL) does not provide financial planning or advice (other than general advice) to members”.
“We have answered the following question on this basis,” it said. “However, we note that independent financial advisers and financial advisers under the CBA Group (related entity to CFS) use our products and platforms.”
On the issue of general advice, CFS declined to be specific.
It said “CFS has a number of customer facing staff who provide general advice as part of our wider member services offering. During the course of business, these same staff would also undertake activities that would not be considered general advice. CFS does not discreetly split these costs, therefore we cannot provide this answer”.
Recommended for you
Sharing his reasoning in joining the FSC board, WT Financial chief executive, Keith Cullen, believes “product and advice cannot be separated” from each other in the current environment.
The Emerge Foundation, a charity run by financial advisers and fund managers, has announced a scholarship program to help veterans transition into tertiary education.
In an open letter, Sequoia chief executive Garry Crole has hit out against shareholders “with a personal axe to grind” as he fights for his job ahead of an EGM.
The JAWG has announced it is in talks with Treasury around five “core principles” to strengthen the education standards for new entrants to the financial advice space.