Of interest looks like our Re exams are very much in line where Oz is going with their pressure on industry upliftment.
This article has been forwarded to you from Complinet by
pstephan@asisa.org.zaMessage:
Financial planners prepare for new professional standards
Apr 08 2011 Wietske Blees in Sydney
The Australian financial planning industry is at a regulatory crossroad that will force practitioners to make a choice: either transition towards meeting new professional standards or leave the industry. This week the Australian Securities and Investments Commission published a set of proposals to lift the standard of advice provided by advisers. The reforms follow a major inquiry into the industry, which suffered significant reputational damage with the collapse of financial service providers such as Opes Prime and Storm Financial.
The changes outlined in Consultation paper 153 were designed to ensure that all financial advisers are adequately qualified to provide advice. The regulator is concerned by the low standard that has been achieved with the existing RG146 qualification, which gives people the ability to advise clients on financial matters after just a few weeks' training.
Instead, the regulator has proposed setting a Financial Services Competency Certification exam, which all new and existing financial advisers who provide "tier one" financial advice would need to pass. In addition, all new financial advisers would be supervised by a planner with at least five years' industry experience for their first full year in the job.
To ensure that financial advisers remain up-to-speed with changes to laws, market issues and new products, they will also have to sit a "knowledge update review" every three years. The regulator has called for feedback on the proposals by 1 June 2011.
Taxing times
In addition to the ASIC reforms, the government has set out new qualifications for financial planners who provide tax advice. Bill Shorten, the minister for financial services, said that in future financial advisers would need to gain a qualification to provide different types of financial services ? including incidental tax advice.
Under the changes financial planners will be able to provide "general factual tax information", but not tax advice, unless they gain a new qualification. Planners will have to register with the Tax Practitioners Board before they can provide full tax agent services. The Practitioners' Board and ASIC are also consulting on the level of qualifications that will be needed to ensure quality advice is provided and that consumers can rely on this advice.
"For consumers, this means they can expect to receive quality financial planning services that include competent advice on related tax issues," Bill Shorten said.
The new regulations will take effect from July 2012, but there will be a three-year transition period after that date for planners and advisers to confirm their qualifications.
Planning for the future
The Financial Planning Association, meanwhile, has been running its own campaign to improve the image of the industry. At an extraordinary meeting held in Melbourne yesterday, 94 per cent of members voted in favour of a new three-year strategic plan that aims to "elevate financial planning as a universally respected profession."
"This is the long-awaited beginning for our members to rebuild trust in their community that professional financial planners take utmost responsibility for delivering on a core promise of professional and ethical behaviour," said FPA chairman Matthew Rowe. "This requires all FPA members to not only act in the public interest, but be seen to do so. It also means we as a professional body will set upward education requirements, endorse higher standards and adhere to a strict code of professional practice."
The question of professionalism in the industry has long been a contentious one. In the wake of the financial crisis there has been a series of enquiries and reform proposals affecting the financial planning sector.
In November 2009, the Ripoll report identified serious shortcomings in the national curriculum for financial planners. The report stated: "The major criticism of the current system is that licensees' minimum training standards for advisers are too low, particularly given the complexity of many financial products."
The government responded to the Parliamentary Joint Committee's recommendations in April 2010 with the Future of Financial Advice package. One of the proposed reforms was to establish an Expert Advisory Panel to "review professional standards in the financial advice industry, including conduct and competency standards, which may include a code of ethics for financial advisers".
The legislation implementing the majority of the reforms will commence from 1 July 2012. In the meantime, the government is continuing to consult the industry on the practical implementation of the reforms.
circular 4 fsb.pdf 
