In a communication to FASEA chief executive Deen Sanders, seen by ifa, AIOFP executive director Peter Johnston has outlined a number of proposals that his board believes would alleviate any “negative impacts” the mandatory standards regime may have on the financial advice industry.
First, Mr Johnston argued that the yet-to-be-introduced national examination – which was specified as part of the Corporations Amendment (Professional Standards) Bill 2016 – should draw heavily on input from financial advisers.
“We are advocating that the examination content is compiled by a panel of experienced advisers, not academics unless they have operated at the ‘coal face’ of delivering advice to clients,” Mr Johnston wrote.
“Academics have a propensity to focus on high level information/knowledge that is irrelevant to both consumers and advisers with their day to day activities.”
The AIOFP also argued that FASEA and educational institutions should take past qualifications and work experience into account when determining the final verdict on professional standards for existing advisers.
In order to reduce the cost of up-skilling where necessary, FASEA should consider recognising courses offered by registered training organisations (RTOs) as well as tertiary education institutions, the email suggested.
“The vastly more efficient business model of RTOs can greatly mitigate the cost of courses whilst delivering comparable material and outcomes to universities,” it stated. “This cost saving will assist the operation of the practice and will also benefit consumers with reduced fee charging going forward.”
The email also argued that FASEA should acknowledge that consumer harm in the financial system is often the fault of product manufacturers rather than financial advisers.
But according to ASIC you will not need a degree or even be licensed, just write a book on Investing. Go to the ASICs own Website
https://www.moneysmart.gov.au/tools-and-resources/videos/video-scott-papes-protect-your-finances-money-challenge
Here ASIC (a government Department) is promoting Scott Pape author of ‘The Barefoot Investor’. Scott recommends that you put insurance in super with no warning on the risk of eroding your savings.
No disclaimers and I do not even know if Pape is licensed to give advice…but who cares he has written a book
Unbelievable! How on earth does this pass muster? If I, as a licensed adviser, must give due consideration to the effects of insurance premiums on my client’s super balances then surely Mr Pape does too? Must be nice to be able to dispense your advice on insurance and super via a $20 book and ASIC’s own website without needing to adhere to the rules….. perhaps I should start writing – it’s just a shame I didn’t think of that before I completed a degree so that I can keep working.
I believe he also tells people that their super should always be 100% invested in cash.
ASIC Financial Advisers Register : No results found for adviser name “Scott Pape”
From his website:
Australian Financial Services License 302081
Date prepared: 25 August 2017
This Financial Services Guide (FSG) is provided to you by Barefoot Blueprint Publications Pty Ltd as trustee for Barefoot Publishing Trust (“Barefoot Investor”) an authorised representative of Barefoot Investment Management Pty Ltd, holder of Australian Financial Services Licence (AFSL) No. 302081.
Wow! ASIC have sunk to a new low. This guy blatantly discourages consumers from obtaining personal financial advice and hides behind general advice warnings when giving product and strategy advice. How on earth can ASIC promote this guy?
And for $397 pa he will give you share tips to follow.
I have a SMSF where the trustees that thinks that paying me $880pa for a diversified portfolio is way too much so bought his subscription after loosing $16k on a direct Asian investment fund!!
A fool and their money will soon be parted.
At last some sense! We may now have relief for the riskies who want a qualification and exam RELEVANT to how THEY help clients – not a damn investment planning degree. What the hell IS wrong with all these academics who’ve never consulted or helped a client?!!!
If AOIFP hadn’t been so busy promoting Astarra and Trio we would have had one less multi-million dollar consumer disaster and perhaps never needed all this extra legislation around education. The whole attitude that their Filtered Research is not a Pay to Play completely conflicted arrangement misses the obvious. Ask your fund managers what they pay AOIFP and their associates in various allowances, incentives etc to get to the Approved List. SHAME AOIFP. SHAME THESE SHAMS ARE WHY HAVE A MESS TO SORT OUT.
so true, but if you listen to Johnston it wasnt his fault….
So true ———“Academics have a propensity to focus on high level information/knowledge that is irrelevant to both consumers and advisers with their day to day activities.
I have AQ9 education status which includes a Master of Financial Planning and research paper completed and graduated in 2016. I have sat many exams as others have. Nobody has a clue as to the contenting of the pending future that every financial planner must sit. The issue I have having jumped through all the necessary hoops for the last 37 years, why on earth should there be an exam which is to be a once off never to be repeated? It certainly does not make sense where the industry is constantly evolving and the rules governing us are being reinvented by a think tank that hasn’t really done its homework.
A financial planner who begins his career at age 25 and sits this proposed one off exam at the age of 30, does not have sit another of this type of exam for ever more. An absolute waste of time and effort.
This has been modelled on the theory that accountants, lawyers and doctors are all trusted by the public and have to sit an exam before being admitted to their profession. They think by us sitting an exam, it will make future entrants better planners, problem is existing planners have never sat one and there is to be no grandfathering or exceptions, as per the minister. Not sure if they have noticed, but there are also rogue accountants, lawyers and doctors… At this point its better we all write it and get it over with, hopefully they can then move on to the accountants, lawyers and doctors and get them to keep accurate file notes, provide a strategy document, provide alternatives, disclose conflicts of interest, have soft dollar limits etc etc….
oh, who am i kidding…!
The adviser’s education is not the problem, but rather those who are unqualified to provide advice, but do it anyway. Case in point the direct insurers. Clean up the rubbish first, then come back to the advisers.
…. be careful what you wish for.. these “experts” seem to be hell bent on destroying this industry. So a qualifications outstrips 20 years of experience.. there are many smart people with s string of letters after their name that are lowsy financial planners… it takes more than technical knowledge to be competent in providing advice.
Big Trev, not all transitioning advisers are asking for your sympathy; just some fairness and logic around how the requirements are decided upon.
Please don’t tar all of us with the same brush as your so called sneering and scoffing counterparts, just because you feel you are in a different league of advisers.
Good on you Big Trev.. how many clients find that relevant to their goals? Sounds like you are trying to start a new technical bullshit era! Sounds like your comfortable in academics destroying this industry with technical stuff that benefits no one except for people like you
I think Peter Johnston is 100% accurate, Well done to the AIOFP He is correct on these two major fronts, Past experience should be a measure of academic achievement and therefore qualification. And courses set by academic’s in the past have borne no relevance to any practical realities of life faced by advisers, one may learn them, but within 6 months they are totally forgotten about as they bear no relevance. The true professional qualifications that advisers need to understand have been borne out in fact by previous courses the old AFA and LUA used to run.
What , have experienced coal face advisers actually set a standard that is relevant and not full of academic crap ? Funny how the degree qualified planners are quick to get in to comment while the rest of us are out seeing clients ! Oh thats right we are not qualified . The profession only developed by those very advisers practicing for the last 20 years . How about we ask the clients what they want ?
oh yes, the degree qualified technically competent advisers are the enemy that’s right go on
Big Trev. you might be surprised how many could answer your questions. Your comment may be generally correct but YOU have missed a lot of information. The questions to be answered are for those that did get off their A#$% and get degrees that are relevant and further education which is also relevant which- in the absence of feedback from Dean et al – appear to be redundant. So mate- sit on it!!!!
Only problem with universities setting the exam is that we’d have to learn Chinese, given their dependancy on overseas students.
I find this type of article hyperbole. It assumes a position that none of the issues suggested by the writer have or will be taken into account by the Board, whom surely have enough collective intelligence to take into consideration a wide range of criteria – which at the very least would involve consultation and engagement with the audience they were governing.
Now Im curious – have you not been paying attention to the industry and this website for the last few years??? Remind me when the last consultation was that you or I as an adviser were cosnulted? You have a lot of faith in government thats for sure! You probably also still pay $2K to turn up to FPA congress thinking they represent you LOL
If this was the first piece of financial planning regulation to come along, I too would have an open mind and faith that common sense will prevail. However we have learnt from bitter experience that common sense rarely does prevail. Bias and incompetence does.
We have seen ASIC try to drown planners and their clients under a tsunami of disclosure requirements, while at the same time turning a blind eye to unlicensed accountants that promote unnecessary SMSFs and geared property speculation.
We have seen the government effectively legalise anti competitive cartel behaviour by insurance companies, which has made it harder for consumers to get insurance advice and more likely they will be ripped off by junk insurance.
Planners have no reason to trust that the government and bureaucrats will get it right with FASEA. Seizing the initiative early on, and exposing bureaucratic bias and incompetence every inch of the way, has to be our modus operandi moving forward.
You gotta be kidding me! Peter seems to have missed the point of the entire FOFA reform process/package. The fact that Advisers couldn’t self regulate to a level which protects consumers is exactly why we are now having to go through all this stuff. The few of us who could see the writing on the wall years ago, got studying and completed degrees and higher education while our counterparts scoffed and sneered as they may their way to the incentivised offshore conventions. Frankly, I have no sympathy whatsoever for an adviser that has been in business or started since 1992 – when the first reforms came through. It was as sure as the sun rising that this would happen. I have no problem being challenged technically. Many many reckon they know about investing but ask them to demonstrate how to calculate an efficient frontier of risky investments of how a bond price is derived taking into account coupon rates, duration etc – and they wouldn’t have a clue. Folks, get used to it – the bullshit era has ended. Get up to standard or piss off.
I don’t know where you earned your degree, but judging from your poor grammar and crass, myopic view of the world, your education didn’t really amount to much did it? Enough of the self-congratulatory posturing.
So Big Trev, if you were so smart and educated early then your degree will be older than 10 years and thus FASEA / FPEC has said that doesn’t count under the new rules.
I guess you’ll be happy to go redo your degree Big Trev – from the mindless comments you make sounds like you are a goose that probably needs to do it again. Wake up to the real world or better still…..Piss off.
Hi Trev, you don’t need to know this stuff.
most important thing to know is how to “connect” with the client. this is a relationship based vocation people try to make it really complicated. it is not.
this sort of technical jargon is not helpful and we don’t need higher standards or technical ability
for those with numerical masters degrees thinking that will help you do your job better. sucked in
don’t you get it. that’s what the majority here think.
I find it quite concerning a financial adviser doesn’t think technical investment knowledge is fundamental to providing good investment advice…
No wonder these education reforms are forced upon us.
i think the writer is being facetious and trying to support Big Trev, read the other comments admonishing Big Trev
Probably right, problem being I have come across advisers that think this. All for connecting and building rapport with a client but you need to be able to back it up…
And why haven’t we heard this from the FPA & AFA ? Please explain !!!!
Because it’s a stupid concept.
Is Johnston worried that he hasnt had his name in the paper for a while? As if the government will allow those to be tested to set their own exam, just think about that concept for a moment….in the light of the current Royal Commission….
As for his other demand that experience be taken into account by FASEA, has he bothered to read the legislation that FASEA have to work to? It specifically states that past experience & designations arent a solution on their own and advisers wont get a free pass becoz they’ve been in the industry for 20 years, been grandfathered a CFP designation but only have the most basic RG146 quals. The framework has been set by the politicians not FASEA, not Sanders, not Brimble.
Its time for all parties get it professionally sorted out, and to chat with the Australian Qualifications Framework (AQF), from the Dept of Education and Training
You think it is time for that? I think it is time for all advisers to simply walk away and shock this abject academic idiots into the real world. Yeah, I know, not practical for everyone to walk away but a good old fashioned STRIKE wouldn’t go astray liana!