You may have already read our previous blog explaining why it’s so important for advisers and planners to complete fact-finds in full and have an effective CIP. As well as protecting your business from successful complaints and a loss of reputation, it could help your business grow by identifying opportunities you would have otherwise missed. You, should, however, adopt a Central Advice Framework. As a fully completed fact-find isn’t the only way to generate referrals and make your business more robust against complaints.
A Central Advice Framework works like a checklist to ensure you collect all the relevant hard and soft facts from the client and consider every option when making a recommendation. Read on to learn five powerful ways this could help enhance your business’s reputation if you’re a multi-adviser practice, and even make it prosper.
- Reduces business risk
A Central Advice Framework puts systems in place that verify that you have taken a holistic view of your client’s situation. It ensures you have considered every aspect of their circumstances in the rationale behind your recommendation.
It verifies that you’ve engaged in joined-up thinking and have considered all the options for your client. While this makes any solution you provide safer and less likely to be challenged, it also means your recommendation is more likely to be the right one.
This will mean happier clients, which in turn could mean referrals and new future business.
- Ensures you miss nothing
Because the Central Advice Framework is a checklist, you’ll have peace of mind that you have gathered and recorded every relevant hard and soft fact. For example, this might be the client’s capital needs as well as their income needs, or past investment experience and how this has shaped their views on risk.
This information is crucial when it’s passed on to a paraplanner, as they can use it to create a clear and accurate suitability letter that will stand up to inspection.
- Ensures you ask the right questions.
This dovetails into the previous point, as the Central Advice Framework checklist makes sure you do not miss important soft facts that would otherwise result in you making the wrong recommendation. This provides you with peace of mind that your recommendation is less likely to be challenged later on. Making it more likely to be approved by your compliance unit.
- Improves business efficiency
As the Central Advice Framework requires you to gather all the information needed by your paraplanners, they can produce a clear and compliant suitability letter more quickly. This is because the paraplanners will not need to chase you for missing information or clarification on certain points.
As a result, your compliance team are likely to approve your recommendation more quickly. Your client receives a more efficient service, and you could also have your presentation meeting and write the business sooner.
- Assists with compliance
A Central Advice Framework ensures your business meets the 11 FCA core business principles. In particular, makes sure that “customers’ interests” are put first. In addition, it also helps you meet the PROD guidelines, which require you demonstrate that your business has a robust, reliable, and repeatable processes.
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In reality, there are 110 things you need to remember to ensure that every client outcome is compliant. By developing a simple checklist to guide you through your client outcome, you can ensure that nothing slips through the net, and it could also improve efficiency.
We believe a financial advice business should have its own bespoke process for the reasons outlined above. That’s why we have prepared many for clients over the years and have extensive experience that puts us ahead of the crowd.
If you would like to learn more about Central Advice Framework, read “A framework for delivering robust, repeatable and reliable financial planning”. A very informative white paper written by our Managing Director Tony Slimmings.
If you would like to discuss how we could use our expertise to help you create a Central Advice Frameworkand relevant documents, please contact us online or by calling 01472 728 030.