In a statement, YTML general manager for advice Terri Ho said more than 80 per cent of the SOA templates the business has seen are over 40 pages, with the largest one presented to them reaching 130.
Ms Ho said clients are subsequently unable to decipher the documents they receive as they are still not as “clear, concise and effective” as they can be.
“In order to maximise engagement with the client, advice must be communicated clearly – from the simplicity of language to supporting research, to SOA length, format and presentation,” Ms Ho said.
“One of the simplest ways advice delivery can be improved is through the SOA.”
Ms Ho said many SOAs were longer than necessary due to the inclusion of information that should be included in other documentation.
“Many SOAs we remedy have usually become too long and more complex because of licensee and adviser disclosures on related parties and other conflicts of interest, as well as paragraphs of technical and general information,” she said.
“Much of the disclosure can and should be referenced within other advice documents, such as the financial services guide and product disclosure statements.”
I miss Financial Plans
The SOA is the only document that ASIC looks at when judging whether the advice is compliant. If the client is only going to read 20 pages, but 60 pages ensures everything is fully explained, I don’t care whether the client reads the full SOA or not. They will receive a minimum SOA of 60 pages or more. If this is how ASIC is going to be, then I will make the SOA as FAT as possible. If the client is charged more because of this, then that is on ASIC. The SOA is a disclosure document that helps protect the Adviser while detailing the recommendations to the client. It is not a work of art.
Avoid these “Fin tech” providers like the plague. Their “artistic” SOA won’t save you when you’re at FOS.
If we have learned anything from the royal commission, having a nice lengthy SOA does nothing, if the advice is crap and not in the best interest of the client. I disagree with your view
no, the original poster is correct. the longer the soa the better, i am trying to get mine to 300 pages
no thanks, i am not taking any risks and everything needs to be major, minor incidental potential, whatever even the smallest of improbabilities of risks, implications etc
I also make clients pass a basic reading and comprehension test before presenting with the SoA that way i know they can read and write
That is extremely fatuous Anonymous – more will not protect you in fact could condemn you – with your client first of all! Tell the client what you are recommending and why. If your research, reasoning and most importantly, logging of your actions are complete you will have a grateful client and a rock solid position.
if you’ve had a complaint go to FOS people you’d know the SOA is not the only thing they will look at/consider. Blame lawyers…they are behind most of the compliance rubbish we now have and as such know exactly how to exploit the gaps and holes when a client wants to really take you to task over something minor…with no recourse for taking you to FOS and losing the system is unjust and too much in favour of the complainant
Why did we get to this point? The SoA, should be a lively document showcasing the benefits of proceeding with the advice.
Heard it all before. We all know the answer but can’t see any licencees or compliance teams rushing to change anything. ASIC even wanted more repetition because some research body said people are more likely to absorb the info. So, their example SOA got larger. Ours will probably get larger with more explanation of fee arrangements and opt-ins and review agreements. There is certainly no push by regulators or licencees to shrink them. Even if one was fully fee for service, no commission, no nothing – the powers to be will demand a big fat SOA. It’s a noose around our neck and will eventually (in fact already is) price us out of the market. One thinks that certain entities no longer care.
we should try and see if we can get to 300 pages long ( I have gotten half way). once we get to 300 pages, afterwards, like Henry Kissinger’s thesis, we will have someone come out and say 300 pages is the max.
can you please go to asic and complain to them and then go to one of the dealer group compliance people and complain to them
then report back to us with an answer
every month there is another person saying the same thing
we, the advisers know this already, everyone knows it
Sandra Sully with the late news