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Comment of the week: FSA did not listen over RMAR concerns

Comment related to last week’s column from Apfa’s Linda Smith: FSA must review RMAR questionnaire

The problems with the RMAR were actually identified 12 months ago. Subsequently, nothing was done to clarify serious issues we had already recognised especially as the FSA refused to answer specific questions.

For firms like us, the RMAR data is utterly meaningless regardless of what the FSA wants it for.

For example, the client fee depends upon complexity of work, scope of work, number of invoices issued in respect of that work, who does the work and the hours they spend on it and any discounts to the fee for legacy trail.

And a fee can cover unregulated work, tax advice, general insurance, RIPs, etc. Oh and all our clients are now on adviser charging so how does that help the regulator? The problem is as always that the FSA did not listen, Apfa’s representations were useless (I know from feedback that the FSA were not prepared to listen and the RMAR reporting requirements were a done deal) and like all regulators they treated us all based on the lowest common denominator.

The RMAR is a classic example of an arrogant, unsympathetic and unresponsive regulator.

We knew we were not ready and we still cannot be. Nor is our back office system, not that it is entirely their fault. Nor were most other firms who claimed they were ready since without FSA guidance they could not be.

And that lack of guidance means the data returned to the FSA is inaccurate because it is inconsistent due to lack of understanding.

Sam Caunt


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Apple: a stellar technology story

By Ali Unwin, head of technology sector research

Apple recently announced the highest-ever recorded quarterly net profit ($18bn), with the sale of 74.4 million iPhones helping the company deliver $74.6bn of revenue for the quarter ending December 2014. These sales were largely driven by strong demand for the new iPhone 6 and iPhone 6 Plus. Highlights included Chinese iPhone sales doubling year-on-year and unit growth of 44% in the US — supposedly a well-penetrated market. Apple ended the quarter with $178bn in cash on its balance sheet, having generated a staggering $30bn in free cash flow during the quarter.

At Neptune, we have been long-term believers in the Apple story, and continue to hold the stock in a number of our portfolios based on the company’s long-term growth prospects. This is predicated on our belief that Apple has proved thus far that it can — unusually for a consumer electronics company — maintain high margins for a sustained period of time, even as adoption of new technology slows down and competitors produce similar-specification products.


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