Updates to the professional standards reform have imposed new Continuing Professional Development (CPD) requirements on all relevant providers, being those who are authorised to provide personal advice to retail clients.

The new standards have implications for licensees and the relevant providers they authorise, specifically in relation to the licensee’s training policy and the training plans implemented for advisers.

What do Licensees need to do?

The Financial Adviser Standards and Ethics Authority (FASEA) hasn’t approved any CPD activities or providers in their CPD Policy yet, so for now it is up to licensees to make an assessment as to whether the CPD activity is appropriate. Licensees will need to consider:

  • The level of expertise of the provider and the facilitator;
  • The level and type of learning undertaken;
  • The learning outcomes and volume of time in undertaking the activity; and
  • The approach for verification of learning outcomes achieved.

At least 70% of all CPD completed by a licensee’s advisers must be approved by the licensee, it is important licensees have a clear approach as to how they will assess CPD activities and the process by which approval will be given.

All licensees have until 31 March 2019 to publish their CPD training policy on their website and ensure CPD training plans for all relevant providers are in place. Sophie Grace can assist licensees to update their policies and procedures in relation to training.

What are the New Requirements?

In January 2019, FASEA finalised their CPD policy for implementation by AFS licensees and relevant providers from 1 January 2019. Relevant providers must:

  • Develop a CPD plan which identifies various factors such as areas for improvement in knowledge, competence and skills;
  • Complete 40 hours of CPD each year and have at least 70% of the CPD activity approved by their licensee;
  • Maintain records of their CPD activities (FASEA has noted they encourage relevant providers to utilise a digital solution to keep accurate records); and
  • Provide records of their CPD activities to their licensee.

Minimum Hours

In addition to the changes noted above, FASEA has set minimum CPD hour requirements for a range of topics as detailed below. The balance of hours can consist of topics in these categories or other categories, as selected by the relevant providers licensee.

CPD CategoryMinimum CPD hours

(per year)

Technical Competence5
Client Care and Practice5
Regulatory Compliance and Consumer Protection5
Professionalism and Ethics9

Licensees and their relevant providers will need to look at a range of CPD activities, beyond industry conferences, to ensure the minimum hours requirements are met.

Types of CPD

FASEA has also given guidance in relation to the various types of CPD which may be undertaken. Examples include:

  • Formal education, provided by an education provider (to maximum of 30 CPD hours per year);
  • Non-formal education such as educating for the purposes of meeting requirements in specific financial advice provisions, or to receive accreditation in specific forms of financial products;
  • Other CPD approved by the licensee, including conferences and workshops which are relevant to financial advice; or
  • Technical reading which is approved by the licensee – to a maximum of 4 hours.

For further information on the professional standards regime refer to our blog article titled ‘Updates to the Professional Standards Reform are Coming – Are you Prepared?’

Should you have any questions about the new CPD requirements, please don’t hesitate to contact us.

Alicia Pevely

Alicia works across both Sophie Grace Pty Ltd and Sophie Grace Legal Pty Ltd with a particular focus on compliance and legal services. She manages the licensing and compliance aspects of the business. She is responsible for AFSL and ACL applications, variations and assists the compliance team in the implementation of compliance reviews. She provides ongoing compliance support and assists with the preparation of legal advice, commercial agreements and disclosure documents.