Research conducted by NMG amongst 140 firms reveals that 20 per cent cannot estimate the financial impact of the RDR transition upon their businesses.
Of those that gave an estimate cost, 9 per cent believe there will be no cost to the business, while 10 per cent believe the costs will be over £10,000 per registered individual.
Despite uncertainty Aifa says almost half of IFA firms are currently investing between one and five hours each week into their transition, 18 per cent are investing between six and ten hours and 6 per cent are investing over ten hours.
However, more than half believe their firms won’t be RDR ready until the end of 2012 and 10 per cent say that transition won’t be complete until beyond 2012
The research follows the recent launch of AIFA’s online business academy, supported by Skandia, which was set up to help IFAs meet the demands of the RDR.
Aifa director general Chris Cummings says: “The FSA’s cost benefit analysis of the RDR stated the cost to the IFA profession to reach compliance would be £430m. Irrespective of IFA estimates, what is clear is that costs borne by firms will be significant. The additional costs, both monetary and time, required to fulfill the RDR requirements are substantial and should not be underestimated.
“However, I am encouraged because, as a profession, we are stepping up to the challenge presented by the RDR. IFA firms around the UK are rolling up their sleeves and getting on with the task of changing their organisations to ensure they are ready. There also appears to be a realistic sense of how long this process is going to take, with nearly two thirds of firms estimating that the project will take over 18 months to complete transition.”