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Guide for Authorised Financial Advisers Released

(Media releases from the Securities Commission)
2 June 2010

The Securities Commission today released the AFA Adviser Business Statement Guide to help financial advisers prepare for the new regulatory regime. The guide explains the document to be prepared by an adviser applying to become an Authorised Financial Adviser (AFA).

Under the Financial Advisers Act a person who provides a financial planning service or gives advice on investment products is required to be licensed as an AFA.

"The reforms aim to build public confidence in the professionalism and integrity of financial advisers by making them more accountable for the advice they give," Commissioner for Financial Advisers David Mayhew says.

As a requirement of the terms and conditions of authorisation AFAs must have an Adviser Business Statement which is kept up to date and available for the Commission to view on request.

"The Adviser Business Statement provides a snapshot of how an adviser operates by explaining the systems and procedures in place to ensure their business is conducted in a professional manner," Mr Mayhew says.

"The Adviser Business Statement will not only help the Commission understand an adviser's business, but will also be a helpful tool for advisers, focusing them on what they need to do to run their business in accordance with the requirements of the Act."

The AFA Adviser Business Statement Guide provides information to help advisers decide whether they need to be authorised. It also outlines the content to be developed in an Adviser Business Statement.

"The guide has been published now, in advance of release of the final Code of Professional Conduct and the amendments to the Act contained in the Financial Service Providers (Pre-Implementation Adjustments) Bill, to enable advisers to start work on their Adviser Business Statements in preparation for the new regime," Mr Mayhew says. "A second edition of the guide will be issued later in the year."

To become an AFA an adviser will have to register online and apply for authorisation in a single process at the Financial Service Providers Register. Applications for registration and authorisation open in July 2010 at http://www.fspr.govt.nz/

See: AFA Adviser Business Statement Guide at seccom.govt.nz (http://www.seccom.govt.nz/publications/documents/afa-guide/)

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Contact: Roger Marwick, ph 04 471 7659