CPA AUSTRALIA FINANCIAL PLANNING SPECIALISATION CPA (FPS) HANDBOOK FOR MEMBERS

Transcription

1 CPA AUSTRALIA FINANCIAL PLANNING SPECIALISATION CPA (FPS) FINANCIAL PLANNING SPECIALIST HANDBOOK FOR MEMBERS EDITION 4 (JULY 2010)

2 TABLE OF CONTENTS 1. INTRODUCTION CPA (FPS) Objectives Overview of the points system Minimum requirements to apply Being an authorised representative / licence holder The requirement to hold a public practice certificate MEMBER BENEFITS Ability to promote the designation CPA (FPS) Registering for CPA Australia s find a financial planner facility Professional development THE 100 POINT SYSTEM IN DETAIL Experience Education / learning Examination ADDITIONAL REQUIREMENTS IF MEMBERS RUN THEIR OWN BUSINESS The public practice program Quality assurance HOW TO APPLY References & other documentation Application fee Checklist for your application FREQUENTLY ASKED QUESTIONS CONTACT CPA AUSTRALIA...28

3 1. Introduction As the financial planning industry continues to grow, an increasing number of CPA Australia members are moving into financial planning. To identify these members and ensure we are able to promote them as leaders in the financial planning industry, a separate designation was considered necessary. A CPA Australia financial planning designation allows the organisation to promote financial planning specialists to both the public and industry, ensuring it becomes recognised and respected by the public and industry and the preferred financial planning designation for our members. CPA Australia is continuing to explore different ways to support its members in financial planning with the financial planning designation as the centrepiece together with APS12: Financial Advisory Standards released in October The designation was designed to appeal both to longer serving members, whose knowledge has been obtained through years of experience, and to new graduates who gain their knowledge through more concentrated formal learning and education. This designation was developed with the assistance of the Financial Advisory Services Centre of Excellence, together with staff from the Financial Planning, Education and Member Services Business Units. This handbook has been revised to reflect the changes in the marketplace caused by Financial Services Reform, the enhanced rules for Regulatory Guide 146 and the changing scope of education courses available.

4 2. CPA (FPS) CPA Australia introduced a new financial planning specialisation in 2002 based on a point system. This model is based on the one the American Institute of Certified Public Accountants (AICPA) adopted for their members who specialise in financial planning. The specialisation is known as CPA (FPS) - Financial Planning Specialist. Only members of at least CPA status are eligible to apply for the specialist designation (designation). To apply, you must earn a total of 100 points, with a minimum of 20 points in each of the following areas: Experience; Education/Learning; and Examination (The 3 E s). Flexibility is built in to obtain the remaining 40 points in either Experience or Education/Learning, recognising knowledge and expertise can be achieved in a number of ways. 2.1 OBJECTIVES Financial planning is a key area for CPA Australia. By creating a specialist designation unique to financial planning, we aim to: 1. achieve public recognition of CPA (FPS) as a highly respected and recognised financial planning professional 2. enhance the quality of financial planning services that members provide and 3. increase practice development and career opportunities for CPAs. For members currently providing financial planning services, or for those considering offering these services in the future, it is important that they seek the CPA (FPS) designation. This provides a number of benefits to CPAs working in the field, including: enhancing the image of CPAs as competent and trustworthy financial planners achieving a greater level of confidence from clients, both internal and external

5 improving our members skills and expertise, resulting in increased professional competency keeping up-to-date in a profession currently experiencing information overload facilitating client referrals among practitioners creating the opportunity for smaller firms to become more competitive in speciality areas of practice and encouraging closer ties within the profession, as members with similar interests are brought together. These objectives follow a similar format to those developed by the AICPA for their designation. 2.2 OVERVIEW OF THE POINTS SYSTEM Experience To be awarded the CPA (FPS) designation, members must earn a minimum of 20 points relating specifically to financial planning experience gained over the past five years. A combination of the type of experience and number of hours determine the points earned. The type of experience depends on whether members are financial planners or work in the industry but are not directly involved in the provision of advice. For financial planners, experience falls into the following six categories: 1. Personal financial planning process 2. Personal income tax planning 3. Risk management planning 4. Investment planning 5. Retirement planning 6. Estate planning. For others working in the industry, consideration is also given to experience in areas such as management, education and training, government policy and compliance Education / Learning Members must earn a minimum of 20 points from assessable education and training. Points can be earned from assessable training courses through to postgraduate qualifications. The number of points earned depends on the level of study completed. All courses must have an assessable component. Members are strongly encouraged to undertake postgraduate studies.

6 2.2.3 Examination To build credibility into the CPA (FPS) designation, members must complete a formal examination. The Education Division of CPA Australia run the CPA (FPS) exam. Twenty points have been assigned to this component, with exams being held twice a year in Divisional offices. Scheduled examination dates are posted on the website at the following link: MINIMUM REQUIREMENTS TO APPLY For the CPA (FPS) designation, members must meet specific eligibility criteria: 1. be a CPA or FCPA 2. attain a minimum of 20 points in each area of Experience, Education/Learning and Examination, with a total of at least 100 points being attained overall 3. complete the online application form 4. submit documentation to substantiate education and experience in personal financial planning. 2.4 BEING AN AUTHORISED REPRESENTATIVE / LICENCE HOLDER Providing advice to the public CPA (FPS) is a designation issued by a professional association and should not be confused with a licence to provide financial product advice. Only the Australian Securities and Investments Commission (ASIC) is authorised to issue a licence to provide financial product advice, known as an Australian Financial Services Licence (AFSL). All members who provide financial product advice must be licensed* by ASIC. However, it is not compulsory for a member to be licensed to attain the CPA (FPS) designation. All principal members** must be licensed because they provide financial product advice. Similarly, members registered on the Find a Financial Planner facility on CPA Australia s website will also be providing financial product advice so must be licensed. (It is imperative that members registered on this facility ensure that their entry is updated as needed. Please any changes in license details or financial planning services to finplan@cpaaustralia.com.au) * Licensed not only refers to those who have been issued with an AFSL, but also refers to those who are Authorised Representatives/Representatives of an AFSL holder. ** Principal members refers to those members who are a principal in their own financial planning practice

7 2.4.2 Members in other roles Members do not have to be licensed to obtain the CPA (FPS) designation. This allows members, who work in the financial services industry but are not providing financial product advice, to apply. Members that might fall into this category include those working in: Management of AFS Licensees Academia Funds Management Government and Providers of specialist services (eg. software, research). 2.5 THE REQUIREMENT TO HOLD A PUBLIC PRACTICE CERTIFICATE CPA Australia s definition of Public Accounting Services includes Financial Planning (By-Laws definitions). Therefore, if you are a principal in practice, you must hold a public practice certificate (By-Law 9.3). This requirement applies to both Licence Holders and Authorised Representatives who fulfil a principal role within their practice. Full details relating to this requirement can be found in Section 5. Applying for a Public Practice Certificate require completion of the Public Practice Program (see section 9.4) and other requirements as stated in the By-Laws. Public Practice Certificate holders are subject to CPA Australia s Quality Review program, which caters for financial planners and the unique relationship Authorised Representatives have with their Licence Holder. Information about Public Practice can be found on the website under Knowledge Portals > Practice Management.

8 3. Member Benefits The CPA (FPS) designation distinguishes members who specialise in financial planning. In addition, the CPA (FPS) credential shows members higher level of skill and knowledge, which enhances their marketing efforts. To support this effort, members receive a number of benefits, including: CPA promotion of the designation CPA (FPS) certificate issue registration on CPA Australia's 'Find a Financial Planner' facility online (where the member is a financial services licensee or a representative). CPA Australia does not levy any ongoing additional membership fee for the CPA (FPS) specialist designation. 3.1 ABILITY TO PROMOTE THE DESIGNATION CPA (FPS) Once members become financial planning specialists, they are able to add FPS to the CPA or FCPA designation. This designation can be promoted via your business cards, letterheads and other business stationery and is written in one of these forms: Mary Smith (F)CPA (FPS) or Mary Smith (F)CPA (Specialist in Financial Planning) Please note that specialist status does not in itself entitle members to use the CPA Logo and other branding materials. This is a privilege reserved for Public Practitioners only Certificate Issued Members are given a certificate as a Financial Planning Specialist (FPS), which can be displayed in their office. This is issued by national office.

9 3.2 REGISTERING FOR CPA AUSTRALIA S FIND A FINANCIAL PLANNER FACILITY When members apply for the CPA (FPS) designation, they are given the option of registering for CPA Australia s Find a Financial Planner facility. This is similar to the Find a CPA facility but is expanded to cover practitioners as well as principals in practice. Members must be licensed by ASIC to register for this facility and must provide evidence of this when lodging an application. By completing the application form you will receive maximum benefit from the Find a Financial Planner facility. This includes details of the type of clients serviced so suitable matches can be made (e.g., area of expertise). Your completion of this application indicates your agreement to maintain the currency of your listing. Please note that it is your responsibility to notify CPA Australia if you change your Australia Financial Services Licensees. 3.3 PROFESSIONAL DEVELOPMENT Clause 11 of APS 12 Statement of Financial Advisory Service Standards mandates that members who hold the CPA (FPS) specialist designation must adhere to the minimum CPD standards as set out in the By-Laws (By-Law 3.9). Those members offering advice under FSR are bound by Regulatory Guide 146 to undertake CPD as part of an ongoing training program. CPA CPD is always interested in following up suggestions for topics of interest for training courses. Contact finplan@cpaaustralia.com.au to discuss ideas. Please refer to the Training & Events section of the CPA Australia website at to check course availability and details.

10 4. The 100 Point System In Detail 4.1 EXPERIENCE Members must include a minimum of 20 points and a maximum of 60 points from experience. There are two options for collecting experience points, depending on whether members are financial planners, or they work in the financial services industry but are not responsible for providing advice. Both options require members to collect points through the number of hours worked and the area of experience. Members may accumulate considerably more points than the maximum if they have extensive experience in financial planning, but these points cannot be counted towards the CPA (FPS) designation. The first 20 points must be from hours of experience. Members must then demonstrate that they have experience in a range of financial services activities. The activities required depend on whether the member is entering as: a financial planner or a member working in the financial services industry (i.e. academic). For financial planners there is a list of core activities (see below). Members should ensure they have experience in all of the core components before calculating how many experience points can be accumulated. Under the second category, members must then demonstrate that they have experience in a range of financial service activities, including at least five of the financial services industry activities listed below. Beyond these requirements, there is flexibility to earn extra points for additional hours of experience or experience in specialist activities Hours Members must earn a minimum of 20 points from the number of hours worked in financial planning. This equates to an average of 15 hours per week over the last five years. Members must detail the average number of hours spent doing financial planning each week over the past five years. This is then converted into a total hours figure. One point is allocated for every 200 hours of experience. The online application form automatically calculates the points. Some examples are provided. Example Average No. hours spent doing financial planning per week 5 yrs ago (a) 4 yrs ago (b) 3 yrs ago (c) 2 yrs ago (d) 1 yr ago (e) Total hours (f:= a+b+c +d+e * 52) Total points (f/200) , , ,640 18

11 4.1.2 Areas of experience planners For financial planners, six key areas are identified where members can gain financial planning experience. These are: 1. Personal financial planning 2. Personal income tax planning 3. Investment planning 4. Retirement and superannuation planning 5. Risk management and insurance and 6. Estate planning. It is expected that all members specialising in financial planning have some experience in the first four areas. Therefore, a number of core activities have been identified under these areas. Members must have experience in all core activities listed if they wish to apply for CPA (FPS) status (see following page for full list of activities). Members can then accumulate additional points from experience in any of the other activities listed in the six areas. This gives members who have specialised in one area the opportunity to accumulate additional points for their specialist knowledge. Members may accumulate considerably more points than the maximum if they have extensive experience in financial planning, but these points cannot be counted towards the CPA (FPS) designation. A member is considered to have experience in an activity if they answer yes to ALL the following questions. The member has identified client circumstances where an area of activity is relevant The member has prepared a financial plan where knowledge in the subject area was applied and The member regularly applies knowledge on the subject area (i.e. at least once per month on average) to client circumstances.

12 Specific Activities Below is a list of the specific activities where members can accumulate points. The list also includes the core activities in which members must have experience. 1 Personal financial planning Core Components Data gathering (including personal details, assets, insurance policies, family circumstances, Wills, etc.) Helping clients to establish their financial goals Risk profiling / risk analysis Identifying constraints in which the client s goals might be achieved (personal circumstances & preference, financial considerations, etc.) Developing and researching strategy Preparing a fully compliant written plan Implementing plans Reviewing plans Activities (1 point each) Conducting financial planning seminars Managing dispute resolution processes Maintaining ongoing client relationships Managing debt Assisting clients with bankruptcy issues Planning for disabled Assisting clients with financial planning issues related to family breakdown Financial mathematics calculations and financial analysis (e.g., ratio analysis) 2 Personal income tax planning Please note: while financial planners are able to provide information and guidance about taxation issues, you must be a registered tax agent (or employee of a registered tax agent) to provide taxation advice unless this is incidental to the advice being given. However, as many CPAs are also registered tax agents, CPA Australia recognises this experience and allows members to collect additional points towards their designation. Core Components General superannuation tax issues Tax aspects of investments

13 Activities (1 point each) Advice about tax-effective structures FBT and salary packaging issues Family business issues (company issues, legal, compliance, etc.) Preparing taxation returns & ongoing taxation review Offshore taxation planning Capital gains tax issues Advice relating to the superannuation surcharge Audits of SMSF Negative gearing Taxation planning for minors Share acquisition schemes Tax aspects of investments Taxation aspects of superannuation 3 Investment planning Core Components Reviewing with clients, their investment preferences and risk tolerance and helping them to develop investment strategies based on these considerations and their goals Discussing available investment options and constraints with clients Developing asset allocation recommendations Recommending investments or helping clients build portfolios Monitoring and interpreting the performance of invested assets and recommending changes Activities (1 point each) Managing portfolios efficiently and effectively Reviewing financial risk exposure Researching and recommending derivative investments Critically researching, analysing and evaluating investment products Critically researching, analysing and evaluating international investments Valuing securities business for investment purposes Advising on agricultural schemes Advising on share trading Advising on investment planning for children Wills Discretionary trusts Advising on investment planning for minors Advising on trusts Advising on employee share schemes Advising on property valuations

14 4 Retirement planning Core Components Helping clients to develop or refine retirement planning Determining income requirements to realise client s retirement planning goals Calculating savings needed to meet retirement income requirements Analysing available retirement product options Reviewing taxation aspects of proposed retirement income streams Activities (1 point each) Assisting clients with Centrelink and other aged based entitlements Advising on corporate superannuation Advising on DIY superannuation Advising on funding options of retirement housing 5 Risk management and insurance planning Activities (1 point each) Analysing clients exposure to risk and reviewing methods for managing risk Reviewing adequacy of existing insurance coverage Advising clients on various types of insurance and helping clients minimise their financial risks from death, disability, illness, property damage and personal and professional liability 6 Estate planning Activities (1 point each) Developing recommendations to meet the financial obligations at death Reviewing tax and probate considerations (CGT, ETP) Recommending or reviewing various instruments (Wills, powers of attorney, trusts, etc.) Advising on business succession planning Developing or refining financial and personal estate planning goals Estimating cash needs at death

15 4.1.3 Areas of experience Others working in the financial services industry For those members not directly involved in the provision of financial planning advice, an alternative range of experience can be used to collect points towards the CPA (FPS) designation. Members using this criteria must have experience in at least five of the financial planning related activities listed below if they wish to apply for the CPA (FPS) designation. If members wish to be evaluated using these criteria, they can only collect additional experience points through the number of hours, not through areas of experience. Specific Activities Below is a list of the specific activities from which members are able to accumulate points. Members must have experience in at least five of the activities listed below. Activities, specifically relating to one of the following six areas: 1. Personal financial planning 2. Personal income tax planning 3. Investment planning 4. Retirement and superannuation planning 5. Risk management and insurance 6. Estate planning Developing and delivering education programs Developing and delivering training programs Assessing training programs Preparing articles for national publications Preparing research papers &/or publications Consulting work Developing and delivering presentations Other activities, not specifically relating to one of the six areas listed above: Managing authorised representatives Undertaking a business development role for authorised representatives Developing and/or analysing government policy relating to the financial services industry Developing and/or analysing financial planning support services (e.g., research, software) Undertaking compliance related activities (including compliance with FSRA, ASIC regulations, social security, taxation)

16 4.1.4 Application requirements experience Two testimonials are required on your application form to validate experience. These must be completed by two of the following: Your licence holder (or responsible officer of the licence) Your current or former employer; or a member of CPA or FCPA status. The purpose of the testimonials is to confirm the information regarding your experience that you have included as part of your application. Additional material, which must be submitted to support your experience if you are a financial planner applying using option one, includes: Confirmation from your Licensee confirming your status as an authorised representative/representative or a copy of your AFS licence. A copy of your tax agent s certificate, or an employer s tax agent s certificate (where applicable). For more information about how to apply, refer to Section 6 of this Handbook.

17 4.2 EDUCATION / LEARNING Members must earn a minimum of 20 points from assessable education and learning. Points are allocated according to the level of study successfully completed. All courses must have an assessable component. A maximum of 60 education and learning points can be counted towards the 100 points for the CPA (FPS) designation. Members may accumulate considerably more points than the maximum if they have extensive qualifications in financial planning, but these points cannot be counted towards the CPA (FPS) designation. Members may accumulate points for education and learning in the following areas: 1. Financial Planning Process 2. Personal Income Taxation 3. Investment (including Securities, Derivatives and Managed Investments) 4. Retirement Planning & Superannuation 5. Risk Management and Insurance 6. Estate Planning 7. Compliance 8. Professional Responsibility. Members must accumulate a minimum 20 points by attaining at least five points in each of the first four categories (i.e. 5 points each in financial planning process, personal income taxation, investment and retirement planning and superannuation). Members may then collect additional points from any of the categories listed above. Points are allocated as follows Undergraduate & Post-Graduate Qualifications in Financial Planning (60 points for all approved undergraduate and postgraduate qualifications in financial planning.) Members who have completed an undergraduate qualification with a major in financial planning or a postgraduate qualification in financial planning are awarded the maximum 60 points in education and learning. It is automatically assumed that anyone with undergraduate or postgraduate qualifications in financial planning have the minimum 5 points in each of the areas of financial planning process, personal income taxation, investment and retirement planning & superannuation. While there are variances in the financial planning qualifications currently available in the undergraduate and postgraduate level, the maximum points awarded for an undergraduate degree is 60. Given that this is the maximum allocation for this category, further distinction is unnecessary.

18 For members who are currently completing financial planning qualifications, each unit must be assessed under the Other Assessable Training option. A stand-alone unit (equivalent to a semester of study) at an undergraduate (Bachelors) or postgraduate level will entitle members to 20 points Open entry training Accredited courses offered by Registered Training Organisations as either a Diploma of Financial Services or an Advanced Diploma of Financial Services can gain up to a maximum of 35 points for one course (not just a module or subject) or 60 points for two, e.g., the combination of Diploma of Financial Services (Financial Planning) and the Advanced Diploma of Financial Services (Financial Planning) would gain 60 points. The discontinued Diploma of Financial Planning from the Financial Planning Association is similarly awarded 60 points. Individual competencies or parts of qualifications are considered and counted under the next section Other Assessable Education and Training (1 point per 6 PD hours) All other relevant training is assessed based on CPD hours*. One point is awarded for every six CPD hours. The training must be in one of the areas listed above and members must have successfully passed the assessment. If the course covers material in a subject not listed above (e.g., Taxation and Audit), only the number of contact hours spent on the areas specified by CPA Australia are counted (Taxation). The online application form calculates the number of points for each assessable training unit for some of the most common courses prior to * CPD hours is the number of professional development hours attributable to the training. Face to face learning equates to contact hours. Where there is a distance learning or examination component, the PD hours may be higher than the contact hours attributed to a particular unit, reflecting the expectation of the time required to complete the learning outcomes. Contact finplan@cpaaustralia.com.au for further advice regarding specific questions on CPD hours for this purpose.

19 4.2.4 CPA Options for Education & Learning Points CPA Australia has a range of ways members can attain learning points. These take into account that some members are new graduates completing the CPA Program while other members are changing careers and prefer shorter training courses. The table below shows how many points can be attained from existing CPA education and learning options. (Courses previously offered by CPA Australia can also be counted.) CPA Assessable Training CPA Program Segment 110 (Personal Financial Planning & Superannuation) 1 No. PD Hours No. Points attained Financial Planning * Allocation of points across knowledge areas Tax * CPA Program Segment (Taxation) 2 RG 146 Financial Advice Foundation Super * RG 146 Investments RG 146 Superannuation Investment * RG 146 Insurance Insurance RG 146 Financial Planning Advising in SMSFs assessment Estate planning Comm Skills Notes * Members must accumulate a minimum of 5 points in this area. 1 Members must still collect additional 9 points: 4 points in taxation and 5 points in investment. 2 Members must still collect an additional 15 points: 5 points in personal financial planning, 5 points in investment and 5 points in retirement planning & superannuation Contact finplan@cpaaustralia.com.au for further advice regarding options.

20 4.2.5 RG 146 and CPA (FPS) ASIC has introduced minimum training standards that all advisers must meet, as detailed in Regulatory Guide 146 (RG 146). There are specialist knowledge areas that advisers may need compliance in, depending on the type of advice being provided. Those areas are: Financial Planning Superannuation Managed Investments Securities Derivatives Insurance. ASIC has established a list of compliant training courses. The list is available on their website at It is the licence holder s responsibility to determine which of the specialist knowledge areas their advisers must be compliant in and to ensure they have completed compliant training courses. While CPA Australia recognises and supports that members must be 146 compliant to be able to provide financial product advice, attainment of the designation is not related directly to RG 146. There are several reasons for this, as outlined below: CPA Australia wants to avoid the confusion that already exists in the market between professional designations such as CPA (FPS) and licensing requirements that are issued by the Government. RG 146 compliance varies from person to person, depending on the type of advice being given. This kind of variation is difficult to build into a designation. RG 146 relates specifically to training completed since 1995 in set topic areas. However, as there were some grand-fathering provisions associated with the designation and some members are not in client-facing roles, CPA Australia cannot guarantee RG 146 compliance of all CPA (FPS) members. One of CPA Australia s strengths in financial planning is our members background and knowledge in taxation. Therefore, this is built into the education requirements of the designation. This is not however, a requirement for RG 146. Not all holders of the CPA (FPS) designation are licensed (i.e. those working in academia) and therefore do not need to comply with RG 146. For members who are licensed and providing advice to the public, it is assumed that they are RG 146 compliant and meeting their ASIC obligations Application requirements education Certified academic transcripts and/or certified copies of assessable training courses that are completed must be provided with the application to verify members education points (except for those completed within CPA Australia). For more information about how to apply, please refer to Section 6 of the Handbook.

21 4.3 EXAMINATION The final area where points must be collected is in the examination. Those who satisfy this requirement receive the maximum 20 points. The CPA (FPS) examination is multiple choice and is three hours duration. It covers the following areas: Compliance / Legislative Issues (10%) Professional Responsibilities (5%) Personal Financial Planning Process (15%) Personal Income Tax Planning (10%) Risk Management Planning (10%) Investment Planning (20%) Retirement Planning (20%) and Estate Planning (10%). Scheduled examination dates are advertised through the website at. There is a charge for the examination, which covers the cost of developing and administering it. This fee is published together with the dates. Once registered for the examination, members are sent: a confirmation letter a few sample examination questions examination instructions. Please note that no study materials are supplied nor recommended for the FPS examination, rather the exam is a means for eligible members to demonstrate their eligibility for the financial planning specialisation Application requirements exam It is strongly recommended that you complete the online self assessment tool to confirm that you satisfy both the experience and education criteria before you enrol for the FPS examination.

22 5. Additional requirements if members run their own business CPA Australia already has additional requirements for any principals who are providing public accounting services. The two main requirements are a Public Practice Certificate and QA reviews. The By-Laws definition of public accounting services is as follows: Public Accounting Services include, otherwise than provided: (a) for the Member personally; (b) for an Affiliate of the Member in consideration of payment of less than the Prescribed Threshold Amount in any Annual Period; or (c) in the capacity of an employee, for an employer's own use; any activities (whether or not provided for reward) in respect of accounting, book-keeping, taxation, auditing, corporate reconstruction, bankruptcy, insolvency, administration, receivership, financial planning, company secretarial duties, reports associated with any actual or proposed sale or purchase of business or securities including by initial public offering, and all similar activities excluding, however: (d) information technology; and (e) management consulting; so long as the last are not provided in conjunction with any of the other activities listed above. This means that financial planners and accountants are treated in the same manner when they are providing services to the public, regardless of whether they hold the financial planning specialist designation. As this requirement affects all principals in financial planning practices, it is worth providing a brief overview of what is involved. For further information, please refer to the materials relating to the Public Practice Program, available at THE PUBLIC PRACTICE PROGRAM This program is designed to help members establish themselves in public practice as a sole practitioner or in partnership. It builds on the technical expertise and experience gained from the CPA Program and members business experience. It also encourages members to focus on risk management and non-technical skills such as communication, marketing and ethics. An important aspect of the program is understanding CPA Australia's expectations of members in public practice. Members who wish to offer public accounting services must hold a Public Practice Certificate, issued in accordance with Part 9 of CPA Australia s By-Laws.

23 The Public Practice Program has two components. There is a one semester distance learning component that is assessed via an examination; and a residential component. The residential complements the distance learning program by providing an opportunity to consider points of special interest with peers and experienced practitioners. It is assumed that residential attendees are familiar with the material covered in the distance learning component, however both components can be completed in one semester. Enrolments take place twice a year, in January and July, through the various divisional offices. Contact your nearest divisional office for more information. 5.2 QUALITY ASSURANCE All public practice certificate holders are subject to Quality Assurance (QA) reviews. These are conducted once every five years to ensure members are adhering to CPA Australia s professional standards. The QA process has been expanded to apply to financial planning practices, whether they are licence holders or authorised representatives. A professional standard, APS12, was developed for financial planning in The QA process for financial planning principals has applied since 1 January 2003.

24 6. How to apply 6.1 THE APPLICATION FORM Online form An online application form has been created for the CPA (FPS) designation. To access the form, go to By using this form, members can automatically see if they have accumulated sufficient points to be eligible for the CPA (FPS) designation. Details are saved so that it is possible to complete it cumulatively. Members must still print and submit the signed application form. They must also ensure that the required signed testimonials along with certified academic transcripts are supplied at time of application. 6.2 REFERENCES & OTHER DOCUMENTATION A hard copy of the following reference material must be submitted with all application forms. Two testimonials Certified copies of academic transcripts for all courses referenced in the application form Certified copies of assessable training results and/or certificates for all courses referenced in the application form A copy of your licence status (i.e. licence or letter from licensee of confirmation of status as authorised representative/representative) where applicable A copy of your tax agent status (where applicable). 6.3 APPLICATION FEE There is an application fee when applying for all CPA specialisations. This fee covers processing and administration costs. Refer to the website at The fee can be paid by cheque or credit card. The application fee does not include the cost for the examination. The examination fee is listed with its advertised dates. (There is NO ongoing additional fee to maintain the specialisation.)

25 6.4 CHECKLIST FOR YOUR APPLICATION Experience Education For financial planners, have you met all the core experience requirements? Or For others in the financial services industry, have you met at least five experience criteria Have you completed at least 4,000 hours of financial planning experience to qualify for minimum 20 experience points? Have you obtained two written testimonials for your application? If you are a financial planner, have you submitted a copy of your licence status (i.e. licence, confirmation of representative status)? If you are a registered tax agent, have you included documentation? Have you completed a relevant degree in financial planning? or Have you collected 5 points in financial planning? Have you collected 5 points in tax? Have you collected 5 points in investment? Have you collected 5 points in retirement planning? Have you included certified copies of results (for courses other than those completed within CPA)? Exam Have you passed the FPS examination? Other Checks Are you a CPA or FCPA? Do you have at least 100 points in total? Have you completed the Find a Financial Planner section of the application form (if applicable)? Have you enclosed the fee/completed credit card details? Have you signed the declaration?

26 7. Frequently asked Questions Q. Why choose the CPA (FPS) designation? A: The CPA (FPS) designation is CPA Australia s mark of quality in financial planning. Leveraging from the CPA brand, the designation also distinguishes our members as financial planning specialists of the highest quality and recognises that our planners have continued to undertake professional development, on top of other qualifications. We are promoting the CPA (FPS) designation to the industry and public to ensure the designation is well recognised. Q: Who must sit the examination? A: All members must meet the examination requirements by sitting and successfully passing the FPS examination. Q. Why is there an examination requirement? A: CPA Australia s FPS designation specifically recognises your previous education and experience at any level in its 100 point system. This system is flexible because it recognises your diverse background and professional experience based on education, experience and the examination. However the exam process ensures that all CPA Australia financial planners are of the same highest professional standard. Q: Can CPA members who hold the CFP designation with the Financial Planning Association, apply for the CPA (FPS) designation? A: The CFP designation does not automatically entitle you to the CPA (FPS) designation. It is highly likely that holders of the CFP designation have satisfied the education and experience requirements though this will depend on how they gained the CFP designation. Q: Do I have to be an authorised representative to obtain the CPA (FPS) designation? A: No. Our members work in a range of financial services roles apart from authorised representatives. This includes members in the financial services industry and members in academia. We recognise and support all our members in this industry. Q: Does obtaining the CPA (FPS) designation automatically meet RG 146 requirements? A: No. Becoming RG 146 compliant varies from member to member depending on the advice being provided. Also, only authorised representatives/representatives must meet RG 146 requirements and the designation is open to all CPA Australia members working in financial services. For further information refer to s of the Handbook. Q: Does meeting RG 146 requirements meet the CPA (FPS) requirements? A: No. The CPA (FPS) requirements also include the examination and experience requirements. The education minimum requirement would normally be met by any post 2003 assessment that satisfies RG 146. The education requirements

27 also include a higher taxation requirement (normally met in gaining CPA status) and the experience requirements are not included in satisfying RG 146. Q: How many years experience is needed to apply for the CPA (FPS) designation? A: The answer depends on the time spent each week doing financial planning. There must be at least 4,000 hours over the past five years to collect the minimum 20 points for experience. This generally is equivalent to 15 hours per week. (Refer to the table on section of the Handbook for some examples of experience). Q: Must CPA training courses be completed to collect education points? A: No. You can collect education points from all relevant assessable training courses. Q: Are there extra benefits for achieving more than 100 points? A: CPA Australia now has only one specialist designation for financial planning. There are no additional benefits for members who attain considerably higher than the minimum 100-point requirement. Q: What pass mark will be used for the FPS examination? A: An expert panel within CPA Australia will determine the final pass mark. This mark will be similar to that used for CPA Program examination (generally between 60 and 65%).

28 8. Contact CPA Australia Complete the online assessment form as the first step, which is located on the Financial Planning page of the CPA website. Queries should be forwarded to or Completed application forms should be forwarded to: CPA Australia Ltd Policy & Research Technical Adviser Financial Planning GPO Box 2820 Melbourne Vic 3001