The Financial Adviser Standards and Ethics Authority (FASEA) was established in April 2017 to set the education, training and ethical standards of licensed financial advisers in Australia.
At its October meeting, the Board of the Financial Adviser Standards and Ethics Authority (the Standards Authority) approved a structured approach to the task of establishing Standards under its legislative obligations.
The Standards Authority resolved that the degree requirement pathway for new entrants, from January 2019, will be:
- An AQF 7 Bachelor degree (made up of 24 courses, of which up to 12 courses will be core) covering fields that include:
- ethics, professional attitudes and behaviours
- financial planning and advice process
- technical requirements
- For career changers - further pathways, at the postgraduate level, covering the same fields
Any tax agents or advisory practices need to be seriously thinking about what impact these education requirements will have on their ability to provide Personal Financial advice to their clients moving forward. Especially for any existing or new employees that they wish to place into advisory roles. If these employees are not existing advisors by the 31 December 2018, they will have to meet the new entrant requirements. In addition, from 1 January 2019, any new advisors will have to have a full professional year (supervised provision of advice), before they can advise unsupervised.
With FASEA requirements likely to see the exodus of a number of existing advisors over the next five years and new requirements placed on existing advisors from 1 January 2019, we foresee a need for businesses to review their future Personal Financial advice delivery model.
It is vital you give consideration as to how your business is going to navigate this transition period. Existing advisors will also need to plan how they will satisfy their education transition requirements. For further details, existing advisors can view the draft proposal here.