Earlier this week, the Financial Adviser Standards and Ethics Authority invited feedback on its initial framework for professional standards. For many advisers, the release would have been met with a sigh of relief, not only because the pathways are completely reasonable, but because it ends uncertainty about what may lay ahead for advisers without relevant degrees.
What the document FASEA put forward for comment confirmed was that advisers who have a degree in a related field of study – such as financial planning (non-Financial Planning Education Council-approved), accounting, finance, tax, law and economics – would be required to do a bridging course of three courses to continue to advise clients. If a standard degree comprises 24 units, three is not a heavy load. Those three courses – the Corporations Act (emphasis on Chapter 7), the FASEA Code of Ethics and behavioural finance – fit squarely into what could be expected of advisers under new standards.
If advisers have a post-graduate qualification in a related field or an approved Financial Planning Education Council qualification, the only bridging course they have to complete is the FASEA Code of Ethics.
We know from previous conversations with individual advisers and associations that doubt around what would qualify as a related field of study was a source of anxiety. The recent clarity should allay fears.
Indeed, it would be difficult for advisers with existing, related qualifications to argue what they will have to do is unreasonable or unfair. It was assumed that the FASEA Code of Ethics would be a component, while it would be possible to complete the other two courses (of 120 hours each) in as little as six months, on a part-time basis. Meanwhile, a number of bridging options will be available from 2019, which will give advisers five years to complete their study.
Some dissent may come from planners whose graduate diplomas fall marginally outside the definition of related field of study, but even then, prior learning may be recognised. Pretty generous.
If anything, complaints may come from those who think the additional education requirements aren’t enough to meet consumer expectations. But FASEA can’t win them all and must balance the needs of the community against the practicalities of lifting the advice market to a higher standard.
Based solely on the volume of emails Professional Planner receives when penning a piece like this, I imagine FASEA will be inundated with feedback on its proposed guidance. It should be noted, however, that the authority is interested only in comments on the practical application of its standards.
Subject to enough bridging options becoming available to give advisers choice and flexibility, there is little cause for alarm.