What to expect in the 2024 adviser exams
With ASIC incorporating the confirmed changes to the financial adviser exam before the next sitting, Money Management explores what the 3.5-hour exam could look like under the new system.
Last week, the corporate regulator announced that it is implementing legislative amendments to the adviser exam, with the next sitting on 26 March set to reflect the changes.
Namely, the changes are:
- Removing the short answer questions from the exam and increasing the number of multiple choice questions.
- Removing the requirement limiting exam participation to new financial advisers who have completed an approved degree and existing providers.
ASIC and exam provider Australian Council for Educational Research (ACER) have since provided more detailed information regarding how these new multiple choice questions will look.
The updated Exam Preparation Guidance 4.0 document states: “The exam will include multiple choice or true/false selected response questions, requiring you to respond in the following way:
- Multiple choice questions – these questions require you to select the correct answer from a selection of four – (a), (b), (c) or (d). You will receive one mark for each correct answer.
- True/false questions – these questions will ask you to determine whether the statement is true or false. You will need to answer all components correctly to receive one mark.”
Moreover, ASIC encourages exam candidates to answer every question even if they are unsure sure of the answer, as marks are not deducted for incorrect answers.
The format of the exam, which will include at least 70 questions, begins with several client scenarios and case studies covering various types of advice such as financial planning, insurance and superannuation.
Practical knowledge is required of financial advice regulatory and legal obligations, applied ethical and professional reasoning and communication – including complying with the code of ethics – and financial advice construction, which includes client suitability, consumer behaviour and decision-making.
This is then followed by standalone multiple choice questions, which “may be complex”, ASIC added.
“Multiple choice questions may be complex. Ensure you read the questions carefully. You will need to use your judgement and select the best answer based on the question asked, especially when you feel there may be more than one correct answer.”
The following question is an example of a standalone scenario question, provided by ASIC:
PQ38 (1 mark): In which of the following situations should a financial planner suspect money laundering?
a) A friend at a BBQ wants some hot investment tips as they have “come into some money”.
b) A colleague asks for free financial advice for their elderly parents who have $50,000 to invest.
c) An existing client asks the financial planner to invest $13,000 cash for a new boyfriend they met online.
d) A new client asks for financial advice on consolidating their various superannuation fund balances totalling $11,502.
Correct answer: Option C
The deadline to apply for the 26 March sitting will close on 8 March.
AUTHOR
Jasmine Siljic
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