The Financial Adviser Standards and Ethics Authority (FASEA) has revealed feedback given to individuals who have failed to pass its Financial Adviser exam is based upon how they performed in each specific segment.
FASEA chief executive Stephen Glenfield made the revelation during an SMSF Association webinar panel discussion and specified the three relevant exam topics driving the process.
“In terms of the exam, clearly you get a pass or a fail. It’s an entry ticket so you’re either in, with a pass, or you have to come and try again. In terms of feedback, the exam is testing on three domain areas – that’s your knowledge of legal and regulatory requirements, your knowledge of ethics and ability to apply ethics to practical situations, and on client behaviours and construction of advice to clients,” Glenfield said.
“When someone fails the exam, the exam provider goes through their exam and [determines whether] there are any one of those particular three areas that they been weak in and has caused them to fail,” he explained.
“So if you’d been getting all of the ethics questions wrong the feedback you’d get with your result would be a recommendation to study heavily on ethics.
According to Glenfield the advisers who so far have failed the exam have tended to be weak across all three areas covered.
“So the advice their getting is to study the three domain areas,” he noted.
Unfortunately advisers are interpreting this as a failure of FASEA to provide sufficient feedback when practitioners fail the compulsory examination but this is not necessarily the case, Glenfield said.
“It’s a reflection [of the practitioner not having] one particular area of weakness, it’s across the board, so the recommendation is to go back again, use the reading guide and study up on what you’re doing,” he said.
Glenfield pointed out FASEA did want to provide deeper exam result feedback and feels enough advisers have now completed the test to allow the government body to do this.
“We can start to look at particular question types that people struggle with and see if there is something we can put out in our exam guides to help people understand that,” he said.
The latest FASEA exam results published showed close to 6500 practitioners have passed the Financial Advisers exam.
