Many statements of advice are too lengthy and complicated for clients to fully understand, according to fintech firm YTML.
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.”
SUBSCRIBE TO THE IFA DAILY BULLETIN
- 17 Aug 2018Grandfathering is not in consumers' interests: KellBy Tim Stewart
- 17 Aug 2018Advisers can ‘professionalise’ clients’ philanthropyBy Lucy Dean and Killian Plastow
- 17 Aug 2018Standalone robo-advisers ‘will not attract’ HNW investorsBy Reporter
- 17 Aug 2018Assess super on value not fees, Rice Warner urgesBy Killian Plastow
- 16 Aug 2018ANZ taken to task over ‘misleading’ general adviceBy Reporter
- 16 Aug 2018Faith in adviser ethics fallsBy Reporter
- view all