Qualifications and CPD

What level of qualification do I need?

The Retail Distribution Review (RDR) requires all financial advisers to hold a minimum qualification of QCF Level 4 and at Diploma Level (37 QCF credits) by 31 December 2012. Without this level of qualification, you won’t be able to offer advice.

In addition, all financial advisers must meet the standards specified by the Financial Services Skills Council for the new appropriate examinations.

Professionalism Rules

On 20th January 2011 the FSA issued a Policy Statement (PS11/01) on delivering the professionalism elements of the RDR. Most of these rules will come into force on 31st December 2012; however, requirements to notify the FSA about adviser competence and ethics will come into effect on 1st July 2011.

The aims of the rules are “to ensure that customers get good quality advice, products and services suited to their needs, from advisers displaying higher standards of professionalism and expertise.”

Advisers are now able to identify their plan to qualify to QCF level 4.

If you choose to take exams the Aviva Financial Adviser Academy provides access to a range of learning support materials to help you pass your exams.

What has been confirmed?

Qualification gap-fill

• Advisers can use existing continuing professional development (CPD) to meet the QCF level 4 standard if they already have an appropriate higher level qualification.
• Gap-fill CPD should be structured, for example, attending courses, seminars, lectures, conferences or workshops, e-learning or other courses provided by distance learning.
• The FSA has delegated the details of exactly what type of CPD is acceptable and how it is measured to the accredited bodies themselves. We’ll have to wait for the accredited bodies to announce their specific requirements later this year.

CPD

• All advisers must complete 35 hours CPD (of which 21 hours must be structured) in each 12-month period.
• All advisers, whether full-time or part-time, must commit the same amount of time to CPD on an annual basis.
• The minimum duration for separate structured CPD sessions will be 30 minutes.

Accredited bodies

• The accredited bodies will issue a Statement of Professional Standing (SPS) every year. The SPS will validate an adviser’s qualifications, CPD and statement of ethics.
• Firms will need to hold an SPS for all advisers who offer independent or restricted advice for retail investment products.
• The FSA has opened the application process for organisations to be approved as an accredited body.

Data and management information

• Firms with their own advisers will be required to provide the FSA with information about individual adviser’s professional standards. This information will underpin an adviser database with additional insights such as alerts from firms, accredited bodies and whistle-blowing. The FSA will set up an individual adviser supervisory function to manage and filter this information.

Competence and ethics

• Firms will be required to notify the FSA from 1 July 2011 of any individual advisers’ competence or ethics issues.

What happens next?

• Potential accredited bodies have now applied to the FSA for approval. Once accredited bodies are set up, you’ll need to decide which one will suit your needs.
• By 31 December 2012, all advisers will need to have a Statement of Professional Standing which will be issued by an accredited body.
• Advisers can now identify their personal qualification gap-fill requirements to meet the QCF level 4 standard. Professional bodies will be able to help advisers identify gaps and advise on the best route to fill those gaps and become qualified to QCF level 4.

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