Ben Marshan CFP® LRS® talks about the three latest white papers the FPA has completed regarding the profession’s education framework.

The FPA has completed three white papers for the professional standards and education framework, concerning the new standards that will be set by the Financial Adviser Standards and Ethics Authority (FASEA).

FASEA, which was set up earlier this year, is responsible for setting each of the standards in relation to curriculum, approving courses, existing planner transition, setting and administering an examination, CPD, a new code of ethics, and designing a professional year for new financial planners.

The FPA’s three white papers are on the education framework, the planner examination and CPD.

Education framework

The FPA’s Head of Policy and Government Relations, Ben Marshan CFP^® LRS^®, confirmed that the FPA has completed its white papers to guide the FPA in consultations with FASEA around the degree and degree equivalency requirements for the profession. The FPA has two main recommendations, centred around the education framework and degree equivalency.

Education framework

For the profession’s degree requirements, the FPA is recommending that FASEA adopt the Financial Planning Education Council’s (FPEC) curriculum, as well as FPEC’s framework for approving education courses and acknowledging the tertiary courses that have already been approved by FPEC.

“This recommendation means that FASEA doesn’t have to start from scratch in terms of developing education standards for the profession. Instead, it can take what the FPA and universities have been working on to build a curriculum and courses for the profession that are robust,” Marshan said.

However, he added there was a risk to the profession, and particularly to students who are currently enrolled in FPEC approved courses, that if FASEA decided to build a new education framework from scratch, then potentially, there would be no students in an approved course who could become a financial planner before 2022.

“So, that means there will be a three year lag on anybody new coming into the profession,” Marshan said. “That’s something FASEA needs to consider.”

100 point plan

As part of its education white paper, the FPA has also outlined its ‘100 point plan’, where existing planners can bridge their education requirements to Australian Qualification Frameworks (AQF) Level 7 – Bachelor degree or equivalent (see article on p15 about AQF). The ‘100 point plan’ is an administration process based on the units of study that a financial planner has completed. This plan will enable planners to ‘make up’ further units of study to meet FASEA’s expected education requirements for the profession.

“This 100 point plan will take in a planner’s existing qualifications and designations, such as CFP^® Certification, DFP, Bachelors and Masters degree, as well as continuing professional development,” Marshan said.

“By considering a planner’s current qualifications, professional designations and CPD, and the points allocated towards a full degree under AQF, a planner can see if they have the necessary points that take them to the equivalent of a degree, or what bridging courses are required for them to undertake, without them actually having to do a degree.”

For example, CFPs who have completed CFP 2-4 are eligible for advanced standing and credit towards FPEC approved Master of Financial Planning postgraduate programs at AQF Level 9.

Exam

The second white paper the FPA has developed relates to the proposed examination that planners will need to take. Marshan confirmed the FPA is recommending a multiple choice exam that takes up to three hours to complete.

“The FPA believes the focus of this exam will primarily be on compliance, with possibly some legislation and regulation included. The FPA believes that the purpose of this exam is to provide consumers with reassurance that the planner they are seeing is up-to-date with their best interest obligations.”

CPD policy

Finally, the FPA’s third white paper concerns CPD, in which it has recommended that FASEA adopt the FPA’s CPD policy as part of its framework.

“Most CPD policies are industry-based, whereas the FPA CPD policy has been designed for the profession. It focuses on professional skills and professional knowledge,” Marshan said. “We have recommended 30 hours of CPD per year, with 10 per cent (three hours) of that being in ethics.”

AQF: What is it?

The Australian Qualifications Framework (AQF) is the national policy for regulated qualifications in Australian education and training. It incorporates the qualifications from each education and training sector into a single comprehensive national qualifications framework.

The AQF provides an integrated policy that comprises:

• the learning outcomes for each AQF level and qualification type;
• the specifications for the application of the AQF in the accreditation and development of qualifications;
• the policy requirements for issuing AQF qualifications;
• the policy requirements for qualification linkages and student pathways;
• AQF qualifications and qualification pathways;
• the policy requirements for the addition or removal of qualification types in the AQF; and
• the definitions of the terminology used in the policy.

One of the key objectives of the AQF is to facilitate pathways to, and through, formal qualifications.

There are 10 levels under the AQF, ranging from Level 1 – Certificate 1, to Level 10 – Doctoral Degree. Most financial planners will fit between Level 5 (Diploma), Level 6 (Advanced Diploma, Associate Degree), Level 7 (Bachelor Degree), Level 8 (Bachelor Honours Degree, Graduate Certificate, Graduate Diploma) and Level 9 (Masters Degree).

The FPA’s Ben Marshan confirmed that CFP^® professionals who have completed CFP 2-4 are eligible for advanced standing and credit towards FPEC approved Master of Financial Planning postgraduate programs at AQF Level 9.