Qualification, exam and professional development

From 1 January 2019, new education and training standards apply to financial advisers as part of the professional standards for financial advisers.

The Financial Adviser Standards and Ethics Authority (FASEA) is currently implementing and overseeing these standards.

For an overview of the how the standards affect Australian financial services (AFS) licensees and financial advisers, see How the reforms affect you.

For dates for financial advisers and AFS licensees to comply with the standards, see Timeline for the reforms and FAQs: Timeframe for passing the financial adviser exam.

Qualification and training courses

The FASEA website has detailed information on the education requirements for existing and new financial advisers.

Financial advisers who are existing providers

Financial advisers who are existing providers must bring their qualifications up to an approved degree or equivalent level to meet the education requirements.

They must have an approved bachelor degree (AQF7 level) or above or equivalent. The maximum requirement is an approved graduate diploma (AQF8 level) comprising eight subjects.

Depending on their current qualifications, an existing financial adviser may only do bridging courses, such as a bridging course about the FASEA Code of Ethics (if it was not included in their qualification).

The FASEA Education Pathways online tool can assist financial advisers to understand what they need to do to meet the education standards.

The FASEA website also lists approved degrees and equivalent qualifications. This list includes current and historical approved degrees and courses, and is updated as additional courses are approved.

New financial adviser

For new financial advisers, the minimum education requirement is an approved bachelor’s degree (AQF7 level) comprising of 24 subjects, or above or equivalent.

Where a new financial adviser already holds an appropriate qualification, they can meet the education standard by attaining an approved graduate diploma (AQF8 level) comprising of eight subjects.

AFS licensees

AFS licensees must update the Financial Advisers Register when the financial advisers they have authorised complete the approved qualifications.

Financial adviser exam

Existing and new financial advisers must pass the financial adviser exam to comply with the professional standards.

The exam tests the practical application of an adviser's knowledge in the three competency areas.

A person training to become a financial adviser must pass the exam:

  • after they have completed an approved degree, and
  • before starting the third quarter of their professional year.

Visit the FASEA website for detailed information on the financial adviser exam, including how to prepare and register for the exam.

Professional year

From 1 January 2019, a person training to become a financial adviser must do a professional year before they are fully qualified. This is also known as the year of work and training.

The professional year is one year full-time, equivalent to 1600 hours. At least 100 of these hours must be structured training. The person works with a supervisor and their AFS licensee to establish a professional year plan.

A person can start this professional year whilst they are in the final stages of completing their approved degree. They must however have completed the approved degree and passed the financial adviser exam before starting the third quarter of their professional year.

When they have passed the exam and are authorised by an AFS licensee to provide personal advice on relevant financial products to retail clients, they can call themselves a provisional financial adviser.

AFS licensees must appoint a provisional financial adviser to the Register. They must also notify FASEA of a professional year arrangement within 30 business days of the start of the professional year.

Visit the FASEA website for detailed information on the professional year, including how to register.

Continuing professional development (CPD) requirements

From 1 January 2019, financial advisers must comply with the CPD requirements set by FASEA, rather than the CPD requirements in Regulatory Guide 146 Licensing: Training of financial product advisers (RG 146). The FASEA CPD requirements involve financial advisers completing 40 hours of CPD each year, of which 70% must be approved by their AFS licensee.

Annual CPD activities include development programs and activities to maintain and extend financial advisers' professional capabilities, knowledge and skills. This includes keeping up to date with all regulatory, technical and other developments relevant to professional financial advice.

A financial adviser (or their AFS licensee) must keep complete and accurate records of their CPD activity, and be able to provide a copy of these records to their AFS licensee on request.

The FASEA website has detailed information on the CPD requirements, including a CPD log book template.

AFS licensees must update the Financial Advisers Register if a financial adviser they have authorised fails to comply with the annual CPD requirements.

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Last updated: 22/09/2021 03:04