The forecast pass rate for the Financial Adviser Standards and Ethics Authority (FASEA) exam for the September and November exams is at 50% and the total number expected to have passed by 2021 will be 15,552, according to Wealth Data.
Wealth Data’s forecast included the 1,700 advisers who attempted the exam in September and a further 800 who are expected to sit the exam in November.
The forecast assumed the latest number of advisers who had already passed the exam and were listed as ‘current’, as per the Australian Securities and Investments Commission (ASIC) Financial Adviser Register (FAR) that was at 14,302.
“A total of 2,500 and assumed a pass rate of 50%. This is quite low for a pass rate and is based on the fact that the majority will be re-sitting the exam and in July, the pass rate for advisers re-sitting the exam was only 39%,” Wealth Data’s director, Colin Williams, said.
This forecast did not take into account advisers who might attempt the exam next year nor advisers who failed at least twice in 2021 and had more opportunities in 2022 to pass the exam.
Also, the forecast was based on the assumption that all provisional advisers (PAs) on the ASIC FAR had passed the exam.
According to Williams, the estimate of 15,552 was reasonably consistent all year with estimates of between 15,000 to 16,000, however the percentage forecast of passes at 82.35% could be misleading as it was based on current advisers.
“When FASEA was introduced, there was a mad rush to become an adviser before year end 2018. At that time there was 27,930 advisers. Therefore, the forecast pass rate only represents 55.68% of advisers who started the FASEA journey,” Williams added.
“We have been able to include 11,901 pass results in our data, which we gained from the FASEA exam ‘Successful Candidates List’ which is public but not all advisers who passed the exam are on the list.”
According to Wealth Data, FASEA had around 300 ‘successful’ candidates who did not have an adviser number and therefore they were hard to track.
Source: Wealth Data
In terms of the biggest losses of advisers this week, IOOF as a group had a net loss of five advisers and was followed by AMP Group and Synchron, both down by four advisers.
Additionally, a long list of licensee owners losing a net one (-1) each, including Ord Minnett, Perks Private Wealth, Mancell Family Trust who own FYG Planners.
At the same time, the total number of advisers decreased by 15 to 18,872.