The Financial Adviser Standards and Ethics Authority’s (FASEA) proposed education standards fail to outline how prior learning will be recognised for existing advisers as they transition to the new requirements, according to an industry body.
The SMSF Association in its submission on proposed guidance on education pathways for existing advisers has therefore called for FASEA to professionally recognise advisers who have made the effort to be educated and have completed education and accreditations.
SMSF Association head of policy Jordan George said: “A more meaningful recognition of advisers’ prior education should help them in the transition to the new regime with less cost and effort while maintaining the high standards that must be achieved to ensure consumer trust.”
George also pointed to the Australian Securities and Investments Commission’s (ASIC) “Report 575 SMSFs: Improving the quality of advice and member experiences” to stress the need for specific SMSF education requirements for advisers in order to raise SMSF advice standards.
“We also recommended greater flexibility for new entrants to undertake university study and still be able to enter the financial advice profession. The proposed FASEA pathway for new entrants is too rigid and may starve the industry of future advisers,” he said.
The association also reiterated calls made by some firms for accountants giving SMSF advice under a limited licence to be more adequately considered under the existing pathways framework.
“We are advocating a specific pathway designed for the services they provide rather than having them spend considerable time and money studying subjects that are not relevant to the advice they provide,” George said.
Meanwhile, the Financial Services Institute of Australasia (FINSIA) has also urged FASEA to recognise advisers’ experience and previous qualifications.
“FINSIA consistently has given support to the principle that new financial advisers should be able to demonstrate their knowledge at a high level and that completing a bachelor degree is suitable for this purpose,” FINSIA chief executive Chris Whitehead said today.
Whitehead said he believes existing advisers should be given greater clarity and certainty about how their prior education and training will be recognised under the framework.
“Certainty and clarity in how prior qualifications and experience will be recognised is essential to retain talented advisers with long-established, trusted relationships with clients,” he said.
“The right balance must be found to achieve this.”
A recent FINSIA survey of its members revealed almost one-fifth of respondents intend to walk away from their advice businesses rather than complete additional university courses recommended by FASEA in its education pathways for advisers.
In addition, many FINSIA members who have completed postgraduate qualifications with the organisation’s predecessor, the Securities Institute of Australia, are confused about the status of their qualifications under the FASEA framework.