A senior executive with the Association of Financial Advisers (AFA) has described the process of sitting the first round of Financial Adviser Standards and Ethics Authority (FASEA) exam as a gamble due to the fact many elements involved are still to be formulated.
AFA policy and professionalism general manager Phil Anderson identified the code of ethics and code monitoring components as areas the reported 600 advisers who have agreed to sit the first round of exams will be taking a chance on.
“The curriculum includes the code of ethics and code monitoring subject, but no one can do that because it’s not available yet. So people who are sitting the exam this month are doing it based upon having read the code of ethics and the explanatory statement on that,” Anderson said.
“They’ve also got the legal obligations course. Now those aren’t available either although you can do certain study [of the legislation], but not in a structured way, so people won’t have had the chance to study those prerequisite courses so they are doing it on faith.”
He said he believed it is mainly one group of practitioners who have agreed to sit the FASEA exam in June.
“It’s the confident and the really good advisers who are saying: ‘I know my stuff, I’m a good adviser, I’m going to have a crack at this. If I pass fantastic and I don’t have to worry about it. If I don’t pass, I’ll just have to go through the process of doing the study and preparing to do it next time,’” he said.
“I think it’s a bit of gamble … and I wonder then how much study they are going to do between now and the end of the month.”
He revealed he had concerns about the practicalities of the existing deadline, seeing the ethics and legal courses would not be available until later this year.
“If you’ve got those two core subjects that won’t be available until later in the year, and with a lot of advisers having to manage families, businesses and relationships, they won’t be able to do two subjects in one semester. It would make more sense to do one subject a semester, so you’re talking about, in a conventional sense, people will only be able to do two subjects in a year,” he pointed out.
“This is why a deadline at the end of next year is in our view unreasonable.”
FASEA has previously stipulated existing advisers must have passed the examination standard by 1 January 2021.
