Advice in Different Contexts
57 Questions
2 Views

Choose a study mode

Play Quiz
Study Flashcards
Spaced Repetition
Chat to lesson

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

Which of the following is a reason why the financial planning industry exists?

  • To help individuals build tailored portfolios (correct)
  • To gather and analyze data for reform
  • To meet fiduciary duty
  • To provide expert advice on tax situations

    • What did the ASIC 'shadow shopping' surveys find about Financial Planners?

  • They were meeting fiduciary duty
  • They were providing bad advice (correct)
  • They had inadequate financial knowledge
  • They were working in the best interests of their clients

    • What is the purpose of stronger legislation in the financial planning industry?

  • To introduce reform (correct)
  • To help individuals build tailored portfolios
  • To provide expert advice on tax situations
  • To meet fiduciary duty

    • According to the text, when is a financial service provided?

    <p>When providing financial advice</p> Signup and view all the answers

    Who is considered an advisor under the legislation?

    <p>Principals, authorized representatives, and paraplanners</p> Signup and view all the answers

    What is an Australian Financial Services License (AFSL)?

    <p>A license that covers those who carry on the business of providing financial services</p> Signup and view all the answers

    What are the key reporting obligations once an ASFL is obtained?

    <p>All of the above</p> Signup and view all the answers

    Which of the following is a requirement for a Statement of Advice (SoA)?

    <p>The SoA must contain the adviser's name and contact details.</p> Signup and view all the answers

    What did ASIC's surveys find about previously prepared SoAs?

    <p>SoAs were too lengthy and complex.</p> Signup and view all the answers

    What type of information should be included in an SoA?

    <p>Information elicited from the client.</p> Signup and view all the answers

    In which circumstances is an SoA not required to be provided?

    <p>In some specific circumstances.</p> Signup and view all the answers

    How can risk tolerance be assessed in financial advice?

    <p>By using a questionnaire</p> Signup and view all the answers

    What does the principle of informed consent in financial advice require?

    <p>Clear and concise communication of advice</p> Signup and view all the answers

    According to the text, what percentage of advice in the 2012 survey was considered 'good'?

    <p>3%</p> Signup and view all the answers

    What is the purpose of the statutory, general law, and ethical fiduciary duty on financial advisers?

    <p>To act in the best interests of the client</p> Signup and view all the answers

    What factors are used to assess whether a financial adviser has met the 'best interest' duty?

    <ol> <li>Reasonable level of expertise</li> <li>Exercise reasonable care</li> <li>Objectively assess client's circumstances</li> <li>Regard any action implemented as being in the client's best interest</li> </ol> Signup and view all the answers

    What are the two key principles for financial planners?

    <ol> <li>Know your client (KYC)</li> <li>Know your product</li> </ol> Signup and view all the answers

    Which of the following is NOT required to be included in a Product Disclosure Statement (PDS)?

    <p>The issuer's contact information</p> Signup and view all the answers

    When can a Record of Advice (RoA) be provided instead of a Statement of Advice (SoA)?

    <p>When the relevant circumstances have not changed significantly</p> Signup and view all the answers

    What are the penalties for failing to provide compliant documents as an adviser?

    <p>Jail sentences and fines</p> Signup and view all the answers

    What is misleading and deceptive conduct?

    <p>Conduct that leads someone to believe something that is false</p> Signup and view all the answers

    According to the text, what is the purpose of the Financial Ombudsman Service (FOS)?

    <p>To handle complaints related to investment advice to retail clients and insurance contracts</p> Signup and view all the answers

    According to the text, what should the adviser do if the complaint cannot be resolved immediately?

    <p>Advise the client of external procedures</p> Signup and view all the answers

    According to the text, what should the adviser do if the complaint is justified?

    <p>Amend procedures, apologize in writing, and pay compensation if applicable</p> Signup and view all the answers

    According to the text, what action can the Financial Ombudsman Service (FOS) take if necessary?

    <p>Move to arbitration and adjudication</p> Signup and view all the answers

    According to the text, what should the adviser do at all times?

    <p>Keep the client fully informed in writing</p> Signup and view all the answers

    According to the text, what is the process if the client is not satisfied with the external (industry) procedures?

    <p>Go to court</p> Signup and view all the answers

    According to the text, what percentage of financial advice in the 2012 survey was considered 'good'?

    <p>3%</p> Signup and view all the answers

    According to the text, what percentage of consumers were satisfied with the advice when ASIC judged that the advice lacked a reasonable basis?

    <p>86%</p> Signup and view all the answers

    What is the purpose of the 'best interest' fiduciary duty for financial advisers?

    <p>To act objectively and solely in the client's best interest</p> Signup and view all the answers

    What are the two key principles for financial planners?

    <p>Know your client and know your product</p> Signup and view all the answers

    According to the text, what must be included in a Statement of Advice (SoA)?

    <p>The adviser's name and contact details</p> Signup and view all the answers

    According to the text, what did ASIC's surveys find about previously prepared SoAs?

    <p>SoAs were too lengthy and too complex</p> Signup and view all the answers

    According to the text, what information should be included in an SoA?

    <p>Information on fees</p> Signup and view all the answers

    According to the text, when is a Statement of Advice (SoA) not required to be provided?

    <p>When the advice is based on inaccurate or insufficient information</p> Signup and view all the answers

    Which of the following is NOT a reason why the financial planning industry exists?

    <p>Lack of access to expert advice</p> Signup and view all the answers

    What was the main reason for the substantial reform in the financial planning industry?

    <p>Poor practice by financial planners</p> Signup and view all the answers

    According to the text, what did the ASIC 'shadow shopping' surveys find about Financial Planners?

    <p>They were not working in the best interests of their clients</p> Signup and view all the answers

    According to the text, what was the purpose of stronger legislation in the financial planning industry?

    <p>To improve the fiduciary duty of financial planners</p> Signup and view all the answers

    Which of the following is NOT a requirement for acting efficiently, honestly, and fairly as a financial adviser?

    <p>Maximizing profits for the adviser</p> Signup and view all the answers

    How can an adviser assess a client's risk tolerance?

    <p>By examining the client's previous investments</p> Signup and view all the answers

    What is the purpose of a Financial Services Guide (FSG)?

    <p>To disclose the services offered and the financial products available</p> Signup and view all the answers

    What is the main purpose of the complaints resolution process in financial advice?

    <p>To resolve disputes and grievances between clients and advisers</p> Signup and view all the answers

    Which of the following is NOT a requirement for obtaining an Australian Financial Services License (AFSL)?

    <p>Being a financial advisor</p> Signup and view all the answers

    According to the text, who is exempt from holding an Australian Financial Services License (AFSL)?

    <p>Authorised representatives</p> Signup and view all the answers

    What is the warning that ASIC has stated is sufficient when providing general advice to a retail client?

    <p>&quot;This advice is general; it may not be right for you&quot;</p> Signup and view all the answers

    According to ASIC guidelines, which of the following is NOT a factor that may indicate the provision of personal advice?

    <p>The adviser did not intend to provide personal advice</p> Signup and view all the answers

    According to the text, what is the purpose of a Product Disclosure Statement (PDS)?

    <p>To disclose the costs and charges associated with a financial product</p> Signup and view all the answers

    What is the potential penalty for misleading and deceptive conduct?

    <p>Up to $15.65 million for a company and $1.565 million for an individual</p> Signup and view all the answers

    What is the purpose of the Consumer Protection provisions in the financial planning industry?

    <p>To provide clients with protection against misleading and deceptive conduct</p> Signup and view all the answers

    What is the recommended approach for resolving complaints and disputes in the financial planning industry?

    <p>To implement a system for rectifying mistakes speedily and practically</p> Signup and view all the answers

    According to the text, what is the purpose of the Financial Ombudsman Service (FOS)?

    <p>To handle complaints about investment advice, insurance contracts, and managed investment or superannuation schemes</p> Signup and view all the answers

    What is an Australian Financial Services License (AFSL)?

    <p>A license that allows individuals to provide financial advice to retail and wholesale clients, as well as dealing in financial products</p> Signup and view all the answers

    What are the penalties for failing to provide compliant documents as an adviser?

    <p>Suspension of the adviser's license</p> Signup and view all the answers

    According to the text, what should the adviser do if the complaint is justified?

    <p>Amend procedures, apologize in writing, and pay compensation if applicable</p> Signup and view all the answers

    According to the text, what is the process if the client is not satisfied with the external (industry) procedures?

    <p>The client may need to go to court</p> Signup and view all the answers

    What is misleading and deceptive conduct?

    <p>Conduct that unintentionally misleads and deceives clients</p> Signup and view all the answers

    More Like This

    Use Quizgecko on...
    Browser
    Open
    Browser
    Browser