New Learning from the CII, in collaboration with the FCA, enables advisers to retest and refresh their technical expertise
The CII has collaborated with the Financial Conduct Authority’s (FCA) retail investments team to create a re-evaluation test of the knowledge required to practice as a retail investment adviser. This is part of the FCA’s drive to raise the standards and competence of financial advisers.
The Level 4 Diploma became the standard when the Retail Distribution Review came into force at the start of 2013. Advisers complete a minimum of 35 hours’ continuing professional development (CPD) each year, with the aim of maintaining and updating their knowledge. Only a few large firms test their adviser’s knowledge yearly as part of their Statement of Professional Standing. Many advisers have never been retested.
The Regulated Retail Investment Adviser Re-evaluation (RAR) is a practical way for advisers to assess their knowledge in five key areas:
- Financial planning principles, standards and skills
- Investment principles and risks
- Personal taxation
- Financial protection planning
- Pensions and retirement planning.
This cost-effective and time-efficient method of re-evaluation enables advisers to evidence their current technical knowledge. It also helps to highlight strengths and identify areas for improvement. Ensuring knowledge is up to date is also vital to making sure the advice given to clients is always sound and that the latest guidelines and principles are followed.
Paul Lothian, Chartered financial planner and director of Verus Wealth, took the test and his firm has now adopted RAR as an integral part of their staff’s annual competence assessment.
Mr Lothian says: “I’ve always been a great believer in the professionalisation of our sector, and the demonstration of knowledge and competence through knowledge and exams. While looking for an objective measure for the ongoing assessment of our adviser staff, my go-to place was the CII and PFS – and I discovered that the Regulated Retail Investment Adviser Re-evaluation had just been launched.
“Initially, I took the test myself, as I didn’t want to ask anyone else to do it until I knew exactly what was involved. Having completed it, I really believe it is an ideal way to have our advisers re-evaluate themselves annually against the diploma standard, which, as well as satisfying the CPD requirement, also highlights any shortcomings. Candidates are given a percentage mark against each of the 14 learning outcomes, so that can help you identify whether there’s any additional learning required.”
Mr Lothian continues: “Alongside that, we also signed up to Financial Assess – the CII’s CPD online learning suite – specifically to allow me to bespoke CPD for our staff to address the areas they work in most frequently. The two together provide a full solution to our ongoing compliance and learning.”
Mr Lothian’s firm felt it was important that the testing took place objectively and that staff could take the test at a time to suit them, without his involvement. He says: “The testing format was easy to navigate and familiar to anyone who had taken PFS exams before. Also, as it is external and third party, our clients know the results are fair and can be trusted.
“I also thought it was excellent value for money, especially when compared to if we were to try to arrange this testing ourselves internally. Between the Regulated Retail Investment Adviser Re-evaluation and Financial Assess, we can be sure we have covered both the basics and any bespoke ongoing learning. There is huge value in that and our advisers have been very supportive of the process.”
He concludes: “It demonstrates to your clients and the regulator that your firm takes ongoing knowledge and competence very seriously, and the PFS is effectively a one-stop shop for everything you need in that regard.”
Steve Jenkins, development director at the CII, adds: “This test has been very well received. Advisers are telling us that this is a useful means of regularly testing that their knowledge is up to date, and demonstrating that they have maintained and refreshed their relevant technical expertise.”
Advisers can take the test at any time in the year, so firms are being encouraged to incorporate it into their professional development review. The CII do not share the results of the test with either the FCA or the candidate’s employer and, on passing the test, individuals can evidence their skills for appraisal and claim 35 hours of structured learning if it is supported by an identified learning need and a reflective statement.
For more information and to register, visit: cii.co.uk/RAR