Professional associations such as the SMSF Association, the Financial Planning Association (FPA) or the Association of Financial Advisers (AFA) should have their continuing professional development (CPD) regime automatically approved by licensees under the new Financial Adviser Standards and Ethics Authority (FASEA) regime.
The SMSF Association has argued that if FASEA adopted such a position on CPD it would achieve “consistency, clarity and simplicity”.
In a submission filed with FASEA this week, the organisation said its position was predicated on the understanding that FASEA’s current proposal was for licensees to approve 70 per cent of a financial adviser’s CPD each year.
“From the Association’s perspective, such a proposal raises legitimate concerns about the extra compliance burden on licensees, potential conflicts of interests between licensees and CPD providers, and incentives for advisers to ‘licensee shop’ for those with a less stringent CPD policy,” SMSF Association chief executive, John Maroney said.
“In addition, the ability for licensees to also be CPD providers and approve their own CPD puts the independence of the system at risk,” he said.
Maroney said that he therefore believed that professional associations could play a key role in offering CPD via courses, training, education events and resources and were, in any case, experienced and skilled in accrediting, designing and delivering CPD to improve industry standards.
“Having professional association’s CPD recognised as approved for FASEA CPD requirements will mean that the work being done by associations to provide accreditation for CPD material won’t have to be reworked by each individual licensee, a process that which will inevitably lead to red tape and inconsistencies,” he said.
“It also ensures that an independent body is an integral part of the CPD process, which aims to maintain advisers’ knowledge standards and provide ongoing professional development, instead of relying wholly on licensees that may not have the resources or knowledge to appropriately approve CPD for their advisers.”
Maroney said the SMSF Association also supported FASEA’s decision to reduce annual CPD hours from 50 to 40, believing that 40 hours was an appropriate standard to ensure that financial advisers were adequately maintaining and extending their professional capabilities, knowledge and skills.