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Totally true

All software companies talk about making life easier for users but in the IFA market all too often the reality seldom lives up to the promises.

If there is one group of people who have time after time delivered what they said they would it is the team behind True Potential – both in their previous incarnation as the line-up that built Positive Solutions and under their new banner.

Launched in January 2008, with a version two release last November, the True Potential software system currently holds details of over 1.8 million policies for just under a million clients on behalf of 2,727 individual advisers belonging to 141 firms. This represents assets of around £8.4bn under advice.

During this period, over £120m has been paid out in commission through more than 42,000 statements which are issued on the day that money is received. The service has live links to 20 providers for electronic valuations covering over 300 products.

The company has now launched its compliance service as they evolve from a technology supplier to a full-blown adviser support group.

I was recently given the opportunity to look at the enhanced functionality they are rolling out to organisations that adopt their wider proposition.

The new service includes a detailed compliance process embedded within the system. This is totally integrated as part of the core technology rather than operating as a standalone process from a compliance consultancy.

True Potential argues that this creates far closer alignment between operational systems and compliance than if an adviser uses a standalone software system and contracts with a compliance consultancy separately.

This provides the firm with a detailed compliance monitoring plan, including, to name just a few elements, key performance indicators, the number of one to one visits needed with advisers, checks of CPD activity, persistency review and adherence to limits on execution-only business.

This version of the software builds on the excellent treating customers fairly functionality which the company launched last year. The TCF system is used to monitor historical interactions with clients and generates the necessary measures and action plans to meet these obligations. In a similar way, the compliance system automates as much as possible of core compliance procedures.

All diary events interact with the compliance system so any events in the individual’s system automatically appear where relevant in the supervisor’s system. Events identify all documents needed for activities and are embedded within systems, so all necessary compliance audit trails are generated dynamically and recorded as part of the process.

One of the core parts of the compliance function is a series of registers to monitor regulatory breaches, money laundering, CPD, policies and contracts, transfer of serv- icing and mortgage business. In turn, these are monitored so if an adviser, for example, does not update their CPD register, this would red-flag that procedures are being breached.

The compliance monitoring module operates a wide range of measures and permanently produces red, amber or green status for each of the activities and the impact of actions that may be taken to address such situations. For example, if an adviser started recomm-ending an excessive amount of a particular product type or the products of a specific provider, flags would be raised to escalate this to their supervisor.

The system is exception management based so it will identify in real time any activities that may potentially go wrong as soon as they are going in that direction, enabling firms to take action immediately before any problems become serious.

Essentially, the system is taking on the burden of monitoring all the essential compliance functions within a firm. Everything is structured to constantly provide all the nec-essary monitoring and identify anything that deviates from compliance requirements.

The compliance service from True Potential includes all the processes to operate in a compliant way, off the shelf, pre-programmed. All monitoring is conducted in real time as opposed to the software- only version which examines issues historically and would require the firm to decide the frequency with which they would want to check activities.

The system ensures all the necessary documents are available to enable cases to be reviewed in the future, helping the firm ensure it does not fall into the classic trap that has been the downfall of so many firms of having given good advice but not having documented it properly.

It is important to understand what the system does not do. Regulatory requirements call for directly authorised firms to maintain their own CF8 function within the business. Consequently, firms do still need internal processes to satisfy themselves as to the quality and suitability of advice, for example, to compare attitude to risk with suitability of business recommendations made.

Equally, while the system will ensure the adviser has all the right types of document, it cannot look within them to ensure they have the right information but a wide range of pre-formatted reports within the software system already automates much of what is produced, so this process should be relatively simple to manage.

This offering maintains the high standard of previous True Potential releases and is worth examining by any adviser looking for external compliance and support services.

If running a successful adviser business is going to necessitate operating a series of clearly defined processes and systems, this package is clearly an ideal way to introduce much of the structure and discipline necessary in a firm and free time to let advisers focus on what they do best, giving advice.


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