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Forecasts of the high ultimate costs of implementing the Government’s Future of Financial Advice (FOFA) changes appear to have been close to the mark, with BT Financial Group (BTFG) having provided Money Management with a glimpse of its expenditures so far.
BTFG has completed its FOFA preparations and is concluding final testing on its compliance solutions, claiming the transition has cost tens of millions of dollars and tens of thousands of hours in training.
The company said it began preparing for the shifts in financial planning six years ago and would be FOFA-ready – despite the scale of the task of transitioning 1100 financial planners, as well as paraplanners and support staff to the FOFA regime.
The experience of BTFG is a case study in the cost to the advisory industry in preparing for FOFA, with the group spending more than 10,000 hours in training its planners in the areas of client engagement under the new regime.
The group’s planners have also sat through more than 100 training sessions conducted by BTFG staffers, who also had to undergo FOFA compliance training to deliver the sessions.
It has also set up more than 23,000 fee disclosure statements through the group’s advisory systems and has committed to supporting all advisers with ongoing FOFA compliance after July 1, including those operating outside Westpac and BT-branded businesses.
When quizzed as to the cost, BTFG said at present the figure had run into the tens of millions and it would be able to provide further details in the coming weeks.
BT Financial Group Advice head of operations Warren Dunne said that with less than two weeks before FOFA formally begins, the group was prepared.
“We are really pleased with and not surprised by adviser’s enthusiasm to get FOFA-ready before the official start date,” Dunne said.
“These are significant reforms for the industry and our planners are demonstrating they want to master them and move forward as evidenced by their early take-up of our platform functionality.”
