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Better qualifications could stand advisers firms in good stead

As well as ensuring advisers have achieved the necessary qualifications and approval to operate post R-Day, they must be mindful not to neglect their ongoing CPD obligations.

The new RDR requirements detail that advisers must undertake a minimum of 35 hours of CPD per year. When totted up, this equates to the best part of an entire working week, so advisers must be careful to schedule this throughout the twelve months from January to avoid attempting to cram it into their calendar later on in the year.

But what should the 35 hours be comprised of and how can firms prove they are meeting their responsibilities in this area?

The FSA’s guidance on the matter dictates that of the 35 hours required, 21 of these need to be structured CPD. This refers to activities such as participating in seminars (web-based or in person), lectures, conferences, workshops, courses or e-learning.

It can also include a certain degree of structured, educational reading where the material has been produced to meet the required learning outcome.

Other ongoing CPD is dependent on the adviser’s existing knowledge and experience level and regular reviews should be conducted to ensure competence is being maintained. Advisers need to keep on top of any changes in the market regarding products, legislation and regulation and they should also address any learning gaps in their technical knowledge whenever such instances are highlighted.

In terms of evidencing their development to the FSA (or the FCA in future), advisers must ensure the CPD they undertake is measurable (such as a seminar with a specified number of hours) and capable of being verified by an accredited body with a certificate or, for example, a test result.

Good quality CPD records should document advisers’ needs, how these are met and confirmation once the activity has been carried out.

Firms themselves are responsible for monitoring their advisers’ CPD and ensuring they remain competent and that their advisers also make a declaration to an accredited body annually to maintain their SPS.

For some this may seem rather draconian, however, forward-thinking firms know it is in their advisers’ best interests that they are on the ball and as equipped as possible to best meet the needs of their clients.

In addition to the CPD requirements, advisers should keep an eye on whether they feel their qualifications remain suitable for their role. Obviously Level 4 is the minimum prerequisite at present but that doesn’t mean that advisers have to stop there if they feel that further credentials would be beneficial. The regulator has no formal intention of raising the bar at present but there is nothing to stop them doing so in the future and it may be better for advisers to stay ahead of the curve rather than having to play catch-up.

Advisers who may be in a ‘qualification frame of mind’, having attained the necessary standards for R-Day, may prefer to push on and go the extra mile now rather than having to revisit the books in future.

With the number of firms we have seen within our group becoming chartered, there seems to be a healthy sub-section of advisers firms willingly looking to exceed the minimum requirements.

The RDR will raise standards across the board and while this is great news for the industry as a whole, forward-thinking firms will want to continue to distance themselves from their competition in some way – higher qualification levels and standards is one such option and I anticipate more advisers and firms looking to pursue this over the months ahead.

Julie Hepworth is group regulatory manager at Perspective Financial Group


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