{"id":902,"date":"2015-09-15T10:42:31","date_gmt":"2015-09-15T01:12:31","guid":{"rendered":"https:\/\/fwgs.net.au\/?p=902"},"modified":"2015-09-15T11:48:30","modified_gmt":"2015-09-15T02:18:30","slug":"fos-top-10-tips-for-accountants-giving-financial-advice-part-3-of-3","status":"publish","type":"post","link":"https:\/\/fwgs.net.au\/fos-top-10-tips-for-accountants-giving-financial-advice-part-3-of-3\/","title":{"rendered":"FOS\u2019 top 10 tips for accountants giving financial advice (Part 3 of 3)"},"content":{"rendered":"

This is the third article outlining the Top 10 tips for accountants giving advice after the accounting exemption expires 30 June 2016.<\/strong><\/em><\/p>\n

7. Use risk profiling tools carefully<\/strong><\/h2>\n

Make sure that the strategy and asset allocation you recommend to a client is consistent with risk profile generated by the risk profiling tool you use. If there are inconsistencies, you must clearly explain them.<\/p>\n

Remember, risk profiling tools are only tools. They all have inherent flaws that must be recognised and addressed by the adviser.<\/p>\n

Fwgs \u2013 our risk profile assessment is included in our software and automatically tallies the outcome which is included in the client\u2019s Needs Analysis.<\/strong><\/em><\/h4>\n

8. Don’t give cookie cutter advice<\/strong><\/h2>\n

This is really a reiteration of tips 6 and 7.<\/p>\n

You should not put all or most of your clients into the same strategy and products, especially not gearing strategies. For example, we saw a Statement of Advice for a client with taxable income of $42,000 that stated: ‘Your reasonable level of surplus income and high tax rate should make gearing an appropriate option for you’.<\/p>\n

The best interest\u2019s duty requires that advice be reasonably likely to achieve the client\u2019s goals and that alternatives have been considered.<\/p>\n

9. Understand and explain the products<\/strong><\/h2>\n

Understand any products you are recommending. Don\u2019t advise on products you don’t understand.<\/p>\n

Don’t just hand over a Product Disclosure Statement (PDS) \u2013 you must explain the<\/p>\n

PDS to your client and record your discussion in the Statement of Advice (SOA).<\/p>\n

Don’t cut and paste PDS disclosures into your SOAs. Show you understand the products by using the same words you use to verbally explain the products to your clients!<\/p>\n

10. Be clear about the advice relationship with clients you know<\/strong><\/h2>\n

If you are giving advice to a friend, relative, colleague or employee, it is critical to formalise and document the process as you would for any other client.<\/p>\n

In addition; declare any conflicts of interest as you would for any other client.<\/p>\n

Finance Wise Global Securities Pty Ltd has a unique solution for accountants requiring an authority to advise on SMSF\u2019s once the accounting exemption expires please email the team at info@wordpress-784484-2675404.cloudwaysapps.com<\/a> to find out more.<\/p>\n

Alison Maynard, ombudsman, investments and advice, Financial Ombudsman Service Australia<\/em><\/p>\n

Source: SMSF Adviser Sept 9, 2016.<\/em><\/p>\n

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