Financial advisers will be given three hours to answer 70 questions in the proposed FASEA Adviser Exam but will only be provided with limited feedback on their answers if they fail.
Advisers will also be required to pay $540 each time they take the exam but will be able to resit the exam multiple times, according to FASEA which has released the draft legislative instrument for the exam for industry consultation.
In its FPS006 Examination Policy paper released with the instrument, FASEA stated the exam would contain at least 70 questions, which would be comprised of at least 64 multiple choices questions and at least six written case study style questions.
The exam will cover Financial Advice Regulatory and Legal Obligations, Applied Ethical and Professional Reasoning and Financial Advice Construction and will be delivered by The Australian Council for Educational Research.
Advisers, however, will not be told how well they have performed with the policy paper stating, “Exams will be marked to a credit level and the candidate will be awarded a “pass” or “fail” on this basis”.
“Exams will be marked to a credit level and the candidate will be awarded a “pass” or “fail” on this basis”
Those who have failed will have limited feedback on how they performed with the policy paper adding, “A candidate who has failed an exam will be able to apply for a review of the marking one time and only of the written response style questions of the exam”.
Advisers choosing to resit an exam will also be presented with a new set of questions with FASEA indicating it would change the exam content on a regular basis.
Each exam would take three and half hours to complete, including 30 minutes reading time, and will be held at exam centres in capital cities and regional centres using dedicated computers that will provide access to any information, including the Corporations Act, to complete the exam.
Exams will be scheduled quarterly from mid-2019, and bi-monthly from 2020, and a digital option will be made available from that date as well for those who are unable to travel to an exam location.
Prior to the commencement of the exams, FASEA will publish a list of recommended reading and practice exams on its website but will not provide examination preparation courses.
FASEA has given advisers less than three weeks, from the release of the standard on 14 December 2018, to make submissions with the closing date of the consultation period being 4 January 2019
And doesn’t this just keep getting better. A little $13M cash grab to boot based on the 25,386 registered planners in Australia according to the Royal Commission. Please tell me to whom this will benefit? We already see the conflict of interest with FASEA board members Brimble, Bond, Kent & Somogyi having vested interests in providing the required qualifications due to their relationships with education providers. And now, let me guess…a private Company or one of their education providers will be selected by the Board to administer these rolling tests???
If, as an adviser, I did not declare these sort of conflicts in every advice document I provide, I would be summarily punished as incompetent, unprofessional and near criminal.
As the FASEA Board is government funded, surely pecuniary interests of Board members such as these would need to be fully outlined and restrict this Board’s ability to function in its’ current state.
I can see that it would be hard to give individual feedback on answers…simply owing to the 25000 odd advisers sitting the exam. However, given there is no preparation from sample questions etc this lack of feedback is arrogant and detrimental to the process. my mind turns to Totalitarianism. George Orwell would be proud of FASEA! no other industry has this incredible oversight and heavy handed legislation. I reckon that life & death would be a space for ethics and scrutiny.. but no, only the financial advisers. Industry funds get away with a different standard of advice. why? THis whole raft of legislation from FOFA to LIF to FASEA has been largely un-opposed by our industry bodies until it is too late. For what reason? vested interests and an idealogy of “professionalism” that is not met by themselves. And the client outcome? sub-optimal. More cost, more paperwork and soon few advisers to provide the advice. Why is it that CPD only has 5hrs on technical and 9hours on professionalism and ethics? why do we have to prove our ethics every year and especially if we pass the exam? Ethics do not change much in a lifetime let alone 12mths. Imagine if our politicians, solicitors, doctors, surgeons, engineers, nurses etc all had to do 9hrs of CPD on ethics? there would be uproar! yet advisers, phhttt! nobody gives a damn. we are just cannon fodder to a perception that we are shonks and need to he more regulated than an Astronaut. Advisers and support staff – lobby your MP hard and tell them you will not vote for them unless they cause the legislation to be dropped. A total re-think on this must happen and the first step is to change the dates. to have 2yrs to pass an exam from 2wks time…yet the exam is unlikely to be available for 6mths… with material available who knows when…then there are only 8 sittings left.(2 in 2019 and 6 in 2020) for all of us who can be bothered to pass this exam. we have institutions already saying their course is compliant when none have been authorised – that shows the ethics of those insitutions and quite honesty, they should be barred. This circus has to stop. Real people, both in and out of our industry, are hugely harmed by the process and standards being applied. HARM is a legal term. Proving that harm in court and heads will roll….we must unite against this regime and not give up. Power is in the hands of the people in all democracies…
well said Patriot. I’ve said in the past few Risk Info editions that the insurers must collectively approach the government and make them understand what has happened and reverse LIF – reinstate our commissions, get rid of this evil 2 year clawback and stop the ridiculous nonsense imposed by FASEA. Some may think I am being naive, but only yesterday I learned that every major life insurer except for Zurich, has seen a drop in new business this past year. This reduction will only continue. The insurers MUST get the message and fight, fight and fight for this reversal of LIF before it really will be too late!
Thanks, Concerned… how do we get a united front? Our industry has been fragmented for years. FSU are interested in us and AIOFP have recommended joining on a monthly payment to get them to lobby their Labor mates. The FSU bods actually think we are being shafted. I hate unions and left wing ones are worse! I have no reasonable ideas on getting consensus from advisers. The ones I talk with just bleat and take no action – not even talk to their MP. your thoughts on that?
We approached our local member and he seemed to have understood the issues. My only suggestion is to continually mention this on Risk Info and appeal to advisers to contact their members. I am not a part of Synchron but I did hear that Don Trapnell is trying to push advisers to contact their members. my only other thought is that as the insurers see a continued drop in New Business, it may spark them into action. In that regard, I will continue to reiterate what I said earlier.
Well done! keep going and I agree… front of mind for every adviser and push for action with their MP.
Wow. It just keeps getting better doesn’t it?
This is such an obvious ploy by FASEA to get rid of advisers. Originally they were going to have a 3.5 to 4 hour exam closed book exam, broken into 6 or 7 different sections. Logic says that if you are going to have different sections of the exam then you can mark them separately and therefore logic says that you could resit only the section that you failed. That would be fair.
Instead when advisers complained about the length of the exam they have reduced the exam time and allowed some books to be used in the exam. That’s good news.
But far worse news is that the exam now will become one exam with no separate sections and little feedback on why you failed or which topic you failed, which means many advisers will be resitting the whole exam and possibly passing the section that they failed the first time but failing a different section the second time. $540 a pop. What a financial scam.
Personally as an adviser I am now more concerned about passing the FASEA exam than I am about the other graduate diploma subjects I will have to study and pass.
There will be a major exodus of advisers who find it all too hard and rightfully so. Risk advisers in particular have had a gut full of this crap. The risk versus reward in this once great industry is completely out of whack.
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