Joint bodies call for adviser exam to be scrapped
The mandatory exam for financial advisers is no longer necessary with all new entrants required to complete AQF level 7 qualifications, the major accounting bodies say.
CA ANZ and CPA Australia have advised the government to remove the exam requirement for financial advisers, given the requirement for all advisers to be educated to at least AQF level 7.
The exam was introduced as part of a range of reforms for financial advisers which received Royal Assent in 2017.
Under the reforms, new entrants to the advice sector are also required to complete a bachelor’s degree at the Australian Qualifications Framework (AQF) level 7 or higher, approved by the relevant standards-setting authority.
In a recent submission, the major accounting bodies noted that all financial advisers providing personal financial advice to retail clients have completed the exam.
“Many of these advisers have already completed additional education – or will have satisfied other permitted transitional requirements such as the recently enacted 10-year experienced pathway,” the submission stated.
“It is CAANZ and CPA Australia’s view that as all new entrants to the financial advice sector must be educated to at least AQF level 7, we believe the exam requirement is no longer required.”
The two accounting bodies have encouraged the government to introduce legislation to remove the requirement to complete the exam for advisers as soon as possible.
If the exam is to remain in place, the accounting bodies said they would support the amendments to the exam proposed by the government in the exposure draft released in mid-December.
One of the proposed changes is to amend the existing regulations so that the exam comprises only multiple-choice questions.
It has also proposed amending the rules so that eligibility to sit the exam is not contingent on the person having already met the qualifications standard before sitting the exam or being an existing provider.
“We believe the quality of the exam will not be diminished if it is all multiple choice,” the submission said.
“We also think that permitting a wider range of people to sit the exam is also welcome as it may encourage those who have left the industry but have not as yet satisfied all relevant provider requirements, or existing advisers, to sit the exam.”
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