Karen Davies, of the National Skills Academy for Financial Services, examines how to negotiate the jungle of RDR options.
Sometimes one can have too much information to make the best decision. I was reminded of this when listening to The Bottom Line on BBC Radio 4 recently. One of the guests was the CEO of a major home improvement chain, who explained that having too many different versions of similar products on display can be more of a hindrance than a help to the customer.
This made me think that perhaps the same is true of RDR solutions: there is such a forest of qualification requirements, levels and solutions, as well as training options, delivery models, gap filling and so on, that it becomes difficult for the individual adviser to make the right choice to suit their needs.
Since the FSA published the final examination standards in 2010, many professional institutes have put qualifications in place that are RDR-compliant. The requirement to hold an appropriate qualification, minimum QCF level-4, comes into effect on 1 January 2013. As a result, there will be a flurry of activity among advisers needing to achieve an appropriate qualification or needing a qualification top up – or “gap fill” as it has become known – to ensure their existing qualification, often at a higher QCF level, is compliant.
For the first time there is choice when it comes to qualifying. No longer is a written examination the only way. There are a number of different assessment methods available, including: multiple choice computer-based examinations; short and long answer manuscript examinations; essay-style assessments; case study-based oral examination; technical interview; competence interview; case study-based presentation; and work-based assessment. Advisers should start by choosing how they would like to be assessed and then pick the qualification that best fulfils their needs.
As all RDR-compliant qualifications have to adhere to the FSA examinations standards, advisers do not have to go back to the professional body that awarded their current qualification, so again there is a choice for advisers of what suits them best.
Because one size does not fit all, here are some suggestions for different types of adviser in different stages of their careers.
● Experienced advisers that give all-round advice have the greatest number of options. They can choose a written examination route, an oral examination route or an alternative assessment route such as Experience Counts. The latter is a work-based assessment of current competence based on recorded evidence, leading to the Chartered Banker Institute (CBI; formerly CIOBS) diploma in investment planning, offered through the National Skills Academy for Financial Services (NSAFS). It involves no written examinations, instead being carried out by a trained assessor in the adviser’s workplace.
● Specialist advisers, perhaps a tax or pension adviser that gives little investment advice, is probably suited to a written examination route or a case study-based oral examination route. The choice is mainly down to personal preference, but both routes will allow advisers to show a comprehensive theoretical understanding of the subject matter without having to evidence practical experience. In addition to the written examinations discussed below, the Chartered Institute for Securities & Investment (CISI) private client investment advice and management qualification can be achieved by an alternative assessment consisting of a written assessment, competency interview and case study presentation.
● A recently qualified adviser that found the written exam relatively straightforward, is probably suited to continuing down the written examination route. They are used to the pattern of study followed by testing. All professional institutes offer qualifications of this type. Here the choice will be between qualifications that are module-based and qualifications that are achieved through one examination lasting three to four hours. Module-based options include: the Chartered Institute of Insurance (CII) diploma in regulated financial advice (five multiple choice exams and one manuscript exam); the CISI investment advice diploma (three multiple choice exams); and the IFS Diploma (one multiple choice exam, one coursework assessment and one manuscript exam). Single exam options include: the CISI private client investment advice and management; and the CBI diploma in investment planning, offered through the Association of Independent Financial Advisers (AIFA).
When it comes to gap fill, there is no single right way to top up a pre-RDR qualification. To find the right solution I suggest that, instead of looking at qualifications and how to achieve them, advisers look to their own needs and preferences. Gaps can be filled through CPD or additional examinations. Examination modules from RDR qualifications may be the right answer or advisers may want to go the whole way and achieve one of the new RDR qualifications on offer.
There are a number of other RDR-compliant qualifications available. Professional institutes, trade associations and the NSAFS can offer more guidance.
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