FPA gears up for ACA report

TheFinancial Planning Association(FPA) has fired a pre-emptive salvo ahead of the release of the Australian Consumer’s Association (ACA) report on the quality of financial planning advice stating that “sweeping generalisations and emotive language” would overshadow the good results of the survey.

In an unusual move the FPA has released comments made by chief executive Ken Breakspear, in the upcoming edition of the association’s magazineFinancial Planning, in which he says the FPA would target unfair media reporting of the survey.

“We have expressed our concerns to the parties about the dangers of sweeping generalisations and emotive language, which overshadow the good to satisfactory range of plans delivered to the participating consumer,” Breakspear says.

He goes on to say that sensational statements would create headlines that were out of keeping with the report and the FPA would oppose distorted reporting on the survey but only to the extent that it would not damage the benefits of the study or restrict consumer feedback while maintaining the reputation of FPA members.

The reason for the FPA’s action is the upcoming publication by the ACA in it’s own magazineChoiceof a ‘quality of advice’ survey, conducted between July and September last year and also set to be available in a separate report from the Australian Securities and Investments Commission (ASIC) who were also involved in the survey.

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The survey involved a number of consumers approaching planners to get a financial plan based on specific circumstances. The FPA was involved through the recommendation of a number of experts to evaluate the plans received as well giving assistance in the survey design.

Breakspear’s comments come in the light of a draft report received by FPA, however the association says it would not comment on the direct findings as the report remained confidential until released by the ACA and ASIC.

However the FPA has also stated those planners and planning firms approached during the survey should be given an opportunity to examine what the panel’s evaluation of their plans and “provide an explanation from the adviser's side in the interests of natural justice.”

Despite this Breakspear says the FPA has been active in dealing with issues involving the quality of advice and rejects the need for further alterations to the industry.

“The FPA seeks to identify possible systemic weaknesses, which may need to be addressed by all licensees. We remain confident about the soundness of the FSRA regulatory framework and the complementary self-regulatory role played by the FPA in accrediting organisations and individual professionals and in education and representation,” Breakspear says.

“We do not need further major changes to our industry standards. The emphasis, as always, must be on diligent, consistent execution and application of these governing regulatory principles and policies to the business context and specific circumstances of the client.”