The Financial Planning Association (FPA) has been flooded with questions from its adviser members on the details of the newly legislated professional and education standards including the exam but there are uncertainties abound.
FPA chief executive, Dante De Gori, told the Sydney roadshow on Friday that the FPA team did not yet have answers on the details surrounding the nature of the exam advisers would have to sit, what a degree would look like, and what a professional year would look like.
De Gori said that while the Federal Government had established the Financial Adviser Standards and Ethics Authority (FASEA), it would still require guidance and the FPA was in a position to influence the body in shaping the details of the framework.
“The FPA is developing position papers to take to this new body about all those different components. Now, there is no definition of degree equivalent. If you speak to some academics, it’s getting a degree so a degree equivalent, what does that actually look like and how do you assess 20-odd thousand individuals on whether they meet the new standard?” De Gori said.
The FPA said the policy team, led by head of policy, Ben Marshan were proposing a concept similar to that of identity verification, where one would have to obtain 100 points to prove their identification through providing various documents.
While the degree level would equate to 100 points, which was the AQF7 in the education qualification framework, every adviser would have opted for different pathways to enter the financial planning profession.
Therefore the FPA would propose that pathways such as diplomas, advanced diplomas, and even continuing professional development (CPD) should contribute to the 100 points.
“The diploma and advanced diploma with CPD would still fall short of the 100 points meaning there would be further study needed but what we’ve been able to do here is if this new body does agree with this concept in theory, then what we can do is work backwards with the education providers and see what courses or how many units of study can you complete in order to obtain the 100 points,” De Gori said.
In order to facilitate a level playing field for planners with different levels of experience, the FPA has proposed to cap CPD points based on the fact that planners must store records for seven years.
The FPA has allocated two points per year of CPD, which would equate to 14 points. The FPA was also planning on proposing that its Certified Financial Planner (CFP) designation should count towards the 100 points.
“That for some people who’ve completed DFP 1-8 to obtain the CFP program, if they have no other further studies, then there will be a need to do some additional study to obtain the 100 points under this proposal,” De Gori said.
