Only 60% of 1,963 the Financial Adviser Standards and Ethics Authority (FASEA) exam candidates passed the exam in July, but the pass rate was even lower among those who were resitting the exam, according to Wealth Data.
The firm’s director, Colin Williams, said that out of a total of 1,963 candidates, 589 advisers resat the exam and only 230 passed it, bringing the pass rate down for re-sitters to 39%.
By comparison, the pass rate stood at 69% for first time exam sitters in July.
Further to that, although FASEA announced that 16,030 advisers had passed the exam so far, Williams said this statement was not correct, as 310 adviser were “new entrants and may be authorised as a provisional financial advisers”.
“I take from this that 15,720 advisers have passed and a further 310 people have passed who may proceed to be an adviser,” he said.
Also, of 18,140 people who, according to FASEA, have sat the exam so far, 310 neither ‘current’ or ‘ceased’ advisers.
This would mean that some advisers had attempted and to date only 14,070 had passed and still held a current adviser role.
This meant adviser passes among advisers who held a ‘current’ status stood at 78.9%, Williams stressed.
“14,070 are active financial advisers on the Australian Securities and Investments Commission (ASIC’s) Financial Adviser Register (FAR),” Williams said.
“After a lot of pushing FASEA on the fact that not all advisers who pass the exam are ‘current’ on the FAR they are now recognising this issue.
“Previously there seemed to be an automatic assumption that everyone who passed was on the ASIC FAR.”
Source: Wealth Data
There would be the exam sittings in September and the final one in November whereby anyone willing to have a go would be able to sit, as opposed to waiting out three months.
Additionally, in 2022, advisers who had failed at least twice by December 2021 would have until September 2022 to pass.
“Given all of this, it is quite hard to predict the total number of passes and in return the number who advisers that will remain on the FAR,” Williams said.
Wealth Data’s latest weekly analysis of adviser movements showed the number of actual advisers continued to decrease to 19,032, with NTAA (SMSF Advisers Network) and IOOF accounting for the biggest losses, being down 22 and 21 adviser roles, respectively.
“It is interesting to note that all 22 losses at SMSF Advisers Network, a limited SMSF advice group, are showing that none switched to other licensees and none appeared to have passed the FASEA exam (using 11,000 known FASEA exam pass result as of May, 2021),” Williams said.
“Whereas IOOF is showing (-25) resignations and of those, 15 have switched in the same time period to alternate licensees and six had passed the FASEA Exam (as of May).”