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Financial Adviser Qualifications

TaxationWeb by Bob Fraser MBE, MBA, MA, FPFS, TEP

Bob Fraser MBE, MBA, MA, FPFS, TEP of Towry Law Financial Services Ltd clarifies the various types of qualifications relating to financial advisers that investors may encounter. This short guide is an attempt to cast some clarity on the range of financial adviser qualifications that investors may come across.

All financial advisers are required by the Financial Services Authority to pass examinations known either as the Certificate in Financial Planning (Cert FP) or the Certificate in Financial Advice (CeFA) before they are allowed to provide financial advice. The Cert FP and the CeFA are basic level qualifications.

Advanced qualifications

Advanced qualifications are not an absolute prerequisite for good advice. Many extremely good and talented Financial Advisors have become so because of their many years’ experience in the industry, not because they have obtained a qualification. However, there is often a correlation between a good adviser and a commitment on their part to learn as much as possible about a particular subject. Often, this commitment expresses itself in a willingness to test this learning by means of various exams.

Clients who wish to ensure that their advisor has shown this commitment will wish to look for the following qualifications. This list is not exhaustive, but covers the main qualifications.

The highest level qualifications are the Certified Financial Planner and the Chartered Financial Planner, and investors should ideally seek advisors with either, or both, of these as they mark out the advisor as both qualified, experienced, and committed to on-going professional development.

List of advanced IFA qualifications

Name of qualification or exam	Abbreviation	Awarding body	Extra information
Advanced Financial Planning Certificate	AFPC	Chartered Insurance Institute (CII)which dates back to 1873. The AFPC can also be used in relevant situations as a route towards regulatory compliance. For example, the Financial Services Authority specifies that all member firms that carry out pension transfers and opt-out business must have a nominated pension transfers specialist within the firm, and this person must hold an appropriate qualification.	Candidates must take 3 advanced exam papers, or equivalents. G10 - the taxation and trusts qualification is compulsory.
Associate, Chartered (Associateship Examination)	ACII	Chartered Insurance Institute (CII)	This is an older-style examination with a primary focus on general insurance (homes, cars, but Insurance Institute mostly commercial). Also had a life insurance component, but most IFAs now tend to sit AFPC exams instead. Standard is broadly equivalent to APFS.
Member by Diploma, The Personal Finance Society	Dip PFS	The Personal Finance Societyis the UK's main body for development of professional students in the financial services industry. It is part of the Chartered Insurance Institute.	When AFPC has been gained, professional membership of the Personal Finance Society is available. Dip PFSs are required to adhere to the Personal Finance Society code of professional conduct and undertake Continuous Professional Development (CPD). It is possible to sit individual AFPC exams, without applying for full Dip PFS or other designation. Many advisers take G60, G70, or H15 exams to help them in their professional work. Ask if an adviser has passed individual advanced exams.
Associate, The Personal Finance Society	APFS	The Personal Finance Society	Requires candidates to sit 6 AFPC exam papers, or equivalents including compulsory G10. Also requires 3 years' relevant prior experience and 1 year's CPD.
Certified Financial Planner	CFP (not to be confused with Cert FP, which is the basic level entry qualification for the Personal Finance Society)	Institute of Financial Planningwhich was founded in 1986. Awarding this international license in the UK since 1995.	Involves having either AFPC qualification or equivalent from another professional body and 3 years' industry experience, plus successful completion of assessed case study aimed at measuring individual's financial planning abilities and application of technical knowledge. Holders also required to maintain CPD.
Fellow, Institute of Financial Planning	FIFP	Institute of Financial Planning	In addition to external AFPC-level exams and 5 years' industry experience plus case study, involves two additional sets of 6-hour examinations.
Fellow, The Personal Finance Society	FPFS	The Personal Finance Society	Requires candidates to sit 10 AFPC exam papers, or equivalents. Also requires 5 years relevant experience and 3 years' CPD.
Chartered Financial Planner	Not abbreviated and not to be confused with CFP, which is the advanced qualification for the Institute of Financial Planning.	Chartered Insurance Institute (CII)	To be awarded Chartered Financial Planner status, an individual will have to gain CII approved financial qualifications equivalent to first degree level, be able to demonstrate relevant experience, adherence to the CII's Code of Ethics and Conduct and a commitment to continuing professional development.

December 2005

Bob Fraser MBE, MBA, MA, FPFS, TEP
Chartered Financial Planner

Towry Law Financial Services Ltd
Mobile phone: 07769880476
e-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Authorised and Regulated by The Financial Services Authority

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About The Author

Mark McLaughlin is TaxationWeb's Co-Founder, Director and Technical Editor. He is a Fellow of the Chartered Institute of Taxation and a member of the Association of Taxation Technicians and the Society of Trust and Estate Practitioners. He lectures on tax subjects, is co-author of Tottel's IHT Annual and Ray & McLaughlin's IHT Planning, and Editor of Tottel's Tax Planning and Annual series. Mark's work has also been published in Taxation, Tax Adviser, Tolley's Practical Tax, Tax Journal and Simon's Weekly Tax Intelligence.

Since January 1998, Mark has been a consultant in his own tax practice, Mark McLaughlin Associates, which provides tax consultancy and support services to professional firms. He publishes a regular 'Tax Update' e-Newsletter for clients and other professional firms. To receive future copies, contact Mark via his website.

Article Added Monday, 02 January 2006

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