In response to a question on notice from Liberal senator Slade Brockman around the implications for sole practitioners who did not pass the exam by the deadline, ASIC said the law “does not distinguish between advisers who are licensees and advisers who are not licensees in respect to the date by which the exam must be passed”.
“Where an adviser fails to pass the exam by the due date they must advise their clients that they are no longer able to provide advice,” ASIC said.
“In some cases, an adviser may help clients move to a new adviser. In other cases, it will be up to clients who want financial advice to find an adviser who has passed the exam.”
The regulator pointed to the extension given by financial services minister Jane Hume for advisers who had previously failed the exam multiple times as a potential option for self-licensed practitioners.
“The law has the effect that if an adviser has not passed the exam by 31 December 2021 (or 30 September 2022 if they qualify for the extension) they must not provide personal advice to retail clients,” ASIC said.
“On 24 June 2021, the minister announced an extension of the exam deadline to 30 September 2022 for those advisers who have failed the exam twice prior to 1 January 2022.”
Earlier in August, FASEA announced that almost 15,000 advisers, or just under 70 per cent of the adviser register, had so far passed the exam out of a total of 16,700 who had sat it.
“The high pass rate reflects that the exam is an achievable exam for competent relevant providers regardless of their area of specialisation,” the standards authority said.
However concerns have been raised about advisers who fail to scrape in under the wire of the exam deadline, with the AFA saying a grace period should be considered to protect the clients of those who fail to pass.
“What are we going to do to protect the clients who might all of a sudden lose access to advice, and equally what can we do to make sure those advisers can exit their business in a graceful way, to avoid a fire sale or in effect being forced to hand their business back to their licensee and turn off client arrangements?” the association’s acting chief Phil Anderson said in June.
If you haven’t done the exam you should have a plan. Look for the 30% to transition to general advice or wealth coaching. Can do basically the same without an SOA or the bullshit compliance.
The exam question are ambiguous, also how to you answer a question which States choose the most correct answer, that is subjective and further more how can it take 6 to 8 weeks to mark an exam that is around 90% multiple choice & online. This exam proves nothing, it was a missed opportunity to properly improve advisor standards by introducing structured learning pathway instead of a multiple guess exam covering many topics in 3.5 hr exam including 15 minutes reading time. NB many people have said you had 2.5 Years to sit the exam I would like to remind people of challenges of running a business during the last 18 months in COVID if anything the FASEA opt in etc should be extended by 12 Months. If you are truly advising clients and not the old flogging of products you will find your time is extremely stretched and the cost of to providing advice under this has increased and certain clients are no longer viable.
Clients are already being orphaned from their advisers in significant numbers. It can be due to one of many bad regulations or cost pressures. This is a problem that is hardly specific to single planner practices failing to pass the FASEA exam after two and half years. It is no reason for (yet another) exam extension.
Sick of hearing it. If you cannot pass within 2 years you need to find a new career.
If you waited until the last minute to do the exam you only have yourself to blame
If you have many years’ experience you should be able to pass the exam.
Having experience does not mean you are a good adviser, it just means you’ve lasted a long time. Read the point above again!
If you have left the exam to the last minute you only have yourself to blame.
The extension is BAD for the industry. Would you go to a surgeon who failed an entry-level exam twice?
It will be 2 and a half years when the deadline expires. More than enough time.
Planners who fail to plan should not be in planning…
2 years and numerous allocated time slots to sit and pass a 3.5 hour exam that relates directly to your livelihood. If you have not passed before Dec 2021, then you only have yourself to blame for the situation you are now in.
FASEA is not the issue. Having to complete 8 Uni units (by Dec 2025) for busy advisers with over 15 years experience is the real issue.
If you have 15 yrs experience & are competent, then this is doable. When I did my 24 unit Bachelors Degree it was done while working full time with 2 kids under 10 yrs of age. Each term only lasts for 12-13 weeks, so its relatively short, focused period of study for less than half the year. It may not be super easy but it is not impossible, especially if you want to stay in planning….
I guess then you will be happy to do it all again in 15 years time?
Not really. This has been known about for years.
We’ll your licensee and product manufacturing peers did the crime and you’re now doing the time. Lucky you’ve got those same parties and the FPA that represent those parties to prevent it happening again…not.
I’m now 5 subjects in and have to put off next 3 for a bit as I’m now snowed under. My suggestion is to do a subject take next term off to stay on top of your job then do next subject. In saying that starting November I will do the next 3 one after the other to get it finished. FPA have a lot to answer for.
15 years experience isn’t a get out jail free card. There’s been enough notice, Dec 2025 is more than enough time if you are committed to the industry and making it truely universally professional. This really points to a flaw that has been in the industry for decades – the barrier to entry was far too low. All the really good advisers I’ve been associated with have taken on extra formal education and it reflects in their business and the quality of their clients. Just going to industry PD days is not formal education – they are just top up sessions and chance to get some PD points to keep an authorisation to practice.
Deal with it. It’s a hoop. Jump through it. I’m a bit lucky – I have three exemptions of the 8 subjects. So far I’ve completed two, and nearly finished a third. They’re not that hard – the problem, like the FASEA exam, is getting over the frustration that you have to do it. You do. Accept it, and move on.
The exam was always designed to be a cull and it was a measure ASIC and Medcraft specifically, were pushing for years. So it is no surprise they will force advisers who haven’t passed to write to their clients and turn off all ongoing fees despite the extension. They have been waiting for this endgame to play out for years, like a drooling pack of blood-thirsty wolves.
Had plenty of time. Sick of hearing about it to be honest.
Agree.
The issue is no longer the exam or education as they are locked in and cant be changed.
Just move on.
The energies should be direct to the compliance burden, the cost of advice, asic levy and last resort compensation issues.
And yes I have done the exam and passed, 60 years of age,34 years experience with no degree and have completed the Grad Dip and also the Masters a couple of months ago. I only received 3 credits.
Just get in and do it…. its amazing what you actually already know.
Yep, agree. The first exam sitting was 20 June 2019. If you haven’t passed yet, you’re either too lazy to get it done, or if you’ve failed it multiple times there’s a question of whether you should remain in the profession or not.
100% agree with you Andrew. There has been more than enough notice. And further, why should any one person band get some sort of special dispensation?? Claiming to be too busy to do an exam, when there has been enough notice, makes me ask how many other essential tasks is that person not doing properly.
Then issue is not about time it is about relevance. The exam is frankly a waste of time and achieves nothing for anybody. I suspect many advisers have put it off knowing full well the absurdity of the situation. They will eventually do it under sufferance but for what. Seems to me another exercise by non achievers trying to bring down the achievers.
What advisers need to do, is to come together and form a body that will represent them as a single collective….and only Advisers….regardless of whom they worked for. That body could also be a Professional Body and take into account the needs of Australians also when writing to Treasury and ASIC on behalf of Advisers. It would also represent actual Advisers…They could also have an internal complaints process that handles disputes and this would help prevent over regulation too…. Similar to the AMA or CPA Australia. This concept is groundbreaking and radical in Australia but it’s worked overseas well. We could then go to FASEA and request this body to peer review those that have failed, and there peers would then say you’re worthy or you’re not. Would a body like that be a good idea?
We alreay have this. They are called AIOFP.
Given the negative feedback, seems like Advisers are quite content to be represented by conflicted bodies, some product manufacturer or the current representative bodies that try to keep all parties 110% happy..that can’t even get advice to be tax deductible, and will never call out those parties when AMP lies to ASIC 22 times etc etc. Quite happy to have those bodies represent Hesta, the Banks, AMP at the expense of the AMP adviser or whatever, and will never ever call out these parties for there wrong doings…One would think with that viewpoint of Professionalism the failure rate in an exam partially testing ethics would be high and perhaps planners deserve everything they get.
Absolutely not. After 30 years in the industry I know that it is not capable of self regulation AT ANY AND ALL LEVELS.
The industry, again at ALL levels, bought the new regs on to itself. No rag tag lobby group is going to be listened to. and if the suggestion is that this body is a home for advisers who don’t accept changes, often uncomfortable changes, it’s doomed before it started.
30 years is in the past, the industry is not the same anymore. The amount of changes over the past few years should entitle us to more trust, not less! Rag tag lobby gtoup indeed, you dont even know who would be on it. I think Michelle is onto something, only self interested people that would lose something from this would think otherwise. Theres a lot here! Anything would be better than the current bodies, they couldnt lobby for ice in alaska.