Why did so many advisers fail the February exam?
With less than a third of advisers passing the February financial adviser exam, the first exam administered under the Australian Securities and Investments Commission, there is just one question that must be asked: what is going on?
Almost three-quarters of the 333 candidates who sat the February exam were re-sitting it for at least the second time.
One of those that failed the latest financial adviser exam was Adam Graham, responsible manager of Iraklisfs Pty and holder of an Australian Financial Services License.
Graham had failed twice before but said this exam was far beyond the scope of the guidance provided by ASIC.
“I’ve done five different versions of the practice exam and I’ve sat two real-life exams and they were all the same,” he said.
“In the [February] ASIC exam, there were 15 money laundering questions in there, talking about Chinese bringing Bitcoin over into Australia and which trust would be the most legal for them to move to interchange money through country through crypto.
“But that sort of stuff was never in any practice exams and FASEA and ACER [Australian Council for Educational Research] covered themselves saying the practice exam is just to guide so we can put in whatever questions we want that has to do with chapter seven of the Corporations Act.
“I think ASIC has an obligation - when they put practice exams out there - at least to put us in a level where we’re in a position to have an idea of what’s coming in the exam.”
A similar complaint was raised by a Professional Year (PY) adviser who did not wish to be named due to fear of breaching a non-disclosure condition of the exam.
“I’m in a Professional Year at the moment trying to get through to the third quarter and it is a little bit tough,” he said.
“I felt the new exam was a little bit different. I wish ASIC could update the most recent [practice exam] because it was different.”
The PY adviser said he would have liked to receive less generic and more tailored feedback after failing the exam or at least receive his exam for review.
“Every exam I’ve done whether it’s bachelor’s – and I’m nearly finished my master’s - you’ve been allowed to get accurate feedback or see the exam and they tell you where you went wrong.
“It’s hard to pinpoint exactly what you’re getting wrong - they give you feedback, but it’s so minimal.
“It’s a big blow to confidence especially to newer people.”
After speaking with several advisers in his network, Joel Ronchi, myIntegrity in Practice principal consultant, said there was no definitive reason or theme for why so many failed.
“Some said to me, it was hard. Some said to me, that it was the same as last year in terms of difficulty. Some said they weren’t quite prepared because it was probably too early in the year and they should have waited till May.
“So in other words, there’s no one saying to me ‘now that ASIC has taken over it’s completely different’ - that’s not what I’m hearing at all.
“For some people, it comes down to how they’ve structured their preparation and what kind of support they’ve got from the licensee potentially.”
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