Application
This unit describes the skills and knowledge required to analyse client needs and provide advice ethically and professionally in financial planning, in compliance with industry regulations and codes of practice. It addresses the training requirements of current Australian Securities and Investments Commission (ASIC) and Australian financial services (AFS) licensing at Tier 1 level.
It applies to individuals who use well-developed interpersonal skills and excellent communication and self-management skills to perform a specialist advisory role in financial planning.
Work functions in the occupational areas where this unit may be used are subject to regulatory requirements. Refer to the FNS Implementation Guide Companion Volume or ASIC for specific guidance on requirements.
Elements and Performance Criteria
ELEMENT | PERFORMANCE CRITERIA |
Elements describe the essential outcomes. | Performance criteria describe the performance needed to demonstrate achievement of the element. |
1. Establish relationship with client | 1.1 Establish client’s knowledge about financial products and services by using range of communication and interpersonal skills 1.2 Respond to enquiries about financial planning products and services by explaining range of products and services available and their relevant fee and charging methodology 1.3 Inform client about role of adviser and licensee or principal responsible for adviser's conduct 1.4 Inform client about procedures for handling complaints and circumstances in which they should be engaged |
2. Identify client’s objectives, needs and financial situation | 2.1 Use range of communication and interpersonal skills to gather client’s personal, financial and business details 2.2 Ask about client’s short-term, medium-term and long-term objectives and goals relating to product 2.3 Identify product risk profile of client 2.4 Obtain understanding of client’s attitudes and expectations of cash flow and relevant taxation obligations |
3. Analyse client’s objectives, needs, financial situation and risk profile | 3.1 Undertake assessment of client needs, using all information gathered and taking into account client’s product expectations and specific needs 3.2 Consult client throughout analysis and seek further clarification where necessary 3.3 Analyse need for specialist advice and ensure client is referred to appropriate adviser for higher level or specialist advice if required 3.4 Conduct product risk profile assessment and obtain agreement from client about assessment 3.5 Apply ASIC generic and specialist knowledge in analysing client needs and risk profile |
4. Develop appropriate strategies and solutions | 4.1 Determine appropriate strategy to provide for identified needs and outcomes based on analysis of products, client risk profile and assessment of client needs 4.2 Undertake relevant research, analysis and product modelling as required 4.3 Draft and present appropriate solution (plan, policy or transaction) to client |
5. Present appropriate strategies and solutions to client | 5.1 Demonstrate appropriate product knowledge when presenting product or service 5.2 Explain and discuss proposed transaction with client in clear and unambiguous way 5.3 Reinforce all relevant details, terms and conditions of product and service with client 5.4 Disclose all impacts and possible risks of solution in clear and concise manner 5.5 Provide written supporting documentation and guide client through key aspects of documentation |
6. Negotiate financial plan, policy and/or transaction with client | 6.1 Clarify and discuss any concerns and/or issues client has regarding proposed plan, policy and/or transaction 6.2 Seek confirmation that client understands proposed plan, policy and/or transaction |
7. Coordinate implementation of agreed plan, policy and/or transaction | 7.1 Obtain client’s formal agreement to proposed plan, policy and/or transaction 7.2 Clearly explain and confirm associated fee and cost structures and confirm client understands these details 7.3 Clearly explain and confirm timeframes for execution and processing, and confirm client understands these details |
8. Complete and maintain necessary documentation | 8.1 Ensure all statutory, transactional and proposal documents are completed and signed off by client 8.2 Ensure that copies of signed agreement and other relevant documentation are exchanged |
9. Provide ongoing service where requested by client | 9.1 Ensure that type and form of ongoing service, including reporting on performance and review of plan, policy or transaction, is agreed with client 9.2 Clearly explain all fees and costs for ongoing and specifically defined services, and check that client understands these details 9.3 Provide ongoing service as required |
Evidence of Performance
Evidence of the ability to:
interpret and comply with industry regulations and codes of practice
analyse client’s needs, financial situation and risk profile, and prepare appropriate strategies or solutions relating to financial planning
provide accurate and ethical advice on financial planning products and services
implement the plan, policy or transaction once agreed by the client and complete documentation accurately.
Note: If a specific volume or frequency is not stated, then evidence must be provided at least once.
Evidence of Knowledge
To complete the unit requirements safely and effectively, the individual must satisfy generic and specialist knowledge requirements relevant to the products and activities in which advice is given.
Generic knowledge
analyse and provide an overview of the economic environment including:
characteristics and impact of economic and business cycles
interest rates and exchange rates
inflation
government monetary and fiscal policy
analyse and provide a detailed explanation of the operation of financial markets including:
roles played by intermediaries and issuers
structure and interrelationships within the financial markets
interrelationship between industry sectors
outline financial products, including:
concept of a financial product – general definition, and specific inclusions and exclusions
types of financial investment products
types of financial risk products.
Specialist knowledge
outline theories of investment, portfolio management and management of investment and risk including:
range of financial products
types of investment products including cash, fixed interest, property, equities and managed investments
types of financial risk products including risk insurance and derivatives
investment concepts
investment strategies
identification of types of risk
client risk profile
provide an analysis of advisory functions covering:
role of financial planner
participants in the advisory services market
range of services provided
financial planning process
profile and financial information of the client
appropriateness of a risk assessment
discuss the legal environment including disclosure and compliance covering:
role of the representative or adviser
relevant legal principles relating to the Corporations Act, Australian Securities and Investments Commission (ASIC) Act, Privacy Amendment (Private Sector) Act, Financial Services Reform Act (FSRA) and Competition and Consumer Act
relationship between ethics and regulatory requirements including good faith, utmost good faith, full disclosure of remuneration and fees, and any other conflicts of interest which may influence the adviser's recommendation
relevant industry standards and codes of conduct
regulators’ guidelines including ASIC Regulatory Guide (RG)146 requirements
complaints resolution procedures (external and internal)
provide an overview of the Australian taxation and social security systems covering:
relevant taxation laws and regulations
effects of taxation on particular financial products
effects of taxation on financial strategies of individuals and entities
explain theories of estate planning including allowable investments, enduring and non-enduring powers of attorney, and share purchase agreements
outline management and investment strategies relevant to estate planning
explain taxation laws and regulations relevant to estate planning.
Assessment Conditions
Assessment must be conducted in a safe environment where evidence gathered demonstrates consistent performance of typical activities experienced in the financial services and products advice field of work and include access to:
common office equipment, technology, software and consumables
financial services product information.
Assessors must satisfy NVR/AQTF assessor requirements.
Foundation Skills
This section describes language, literacy, numeracy and employment skills incorporated in the performance criteria that are required for competent performance
Skill | Performance Criteria | Description |
Reading | 2.3, 3.1, 4.1, 4.2 | Recognises and interprets textual information from relevant sources |
Writing | 1.1-1.4, 2.1-2.4, 3.1, 3.2, 3.4, 4.3, 5.2-5.5, 6.1, 6.2, 7.1-7.4, 9.1, 9.2 | Uses clear, specific and industry related terminology to complete and consolidate workplace documentation |
Oral Communication | 1.1-1.4, 2.1-2.4, 3.2, 3.4, 4.1, 5.2-5.5, 6.1, 6.2, 7.1-7.4, 9.1, 9.2 | Clearly articulates requirements using language appropriate to the audience and environment Confirms understanding through active listening and questioning |
Numeracy | 1.2, 2.3, 3.1, 3.4, 4.3, 7.2, 9.2 | Interprets financial product information and calculates client costs, risks and returns |
Navigate the world of work | 1.3, 1.4, 3.5, 4.2, 5.3, 5.4, 9.1 | Takes personal responsibility for following explicit and implicit policies, procedures and protocols to provide advisory services and documentation that comply with legal, statutory and organisational requirements Extends knowledge of regulatory financial planning service requirements relevant to current role using research and investigative analysis |
Interact with others | 1.1, 1.2, 2.1, 2.4, 5.5, 6.1, 7.2, 7.3, 9.2 | Selects and uses the appropriate conventions and protocols when communicating with clients to build rapport, seek and share information, establish clear agreement and maintain an ethical service relationship Adapts personal communication style to show respect for the values, beliefs and cultural expectations of others |
Get the work done | 2.3, 3.1, 3.3, 3.4, 4.1, 4.3, 5.1, 7.1, 8.1, 8.2, 9.3 | Takes full responsibility for the planning, sequence and priority of tasks within own workload to achieve effective and compliant outcomes Applies systematic and analytical decision-making processes to determine and implement investment solutions that meet client needs and financial requirements, including referral to specialist personnel as required Uses the main features and functions of digital tools to complete work tasks |
Sectors
ASIC units