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Paper No. 1 - RDR Qualifications - some things you may not know

This document clarifies some of these issues and answers some of the transitional questions that you may have and provides detail around the final rules set out in the FSA's
PS 11/1 Distribution of retail investments: Delivering the RDR - professionalism.

Background to professionalism and qualifications

As you are aware the FSA's Retail Distribution Review (RDR) included a requirement for advisers to raise their knowledge levels from the current benchmark Qualifications and Credit Framework (QCF), (or equivalent) Level 3 qualification, commonly the Financial Planning Certificate (FPC) or Certificate in Financial Planning (equivalent to A Level), to a Level 4 Diploma qualification (equivalent to the 1st year of a degree).

On behalf of the FSA, the Financial Services Skills Council (now the Financial Skills Partnership), created new Appropriate Exam Standards (AES). These standards define the knowledge that an adviser must have in order to carry out the activity of Advising on Packaged Products. Awarding bodies, such as the CII, were then able to develop QCF approved Level 4 qualifications to meet the new standards.

These new AES were raised to QCF (or equivalent) Level 4 from Level 3 (with the exception of Financial Protection) and consist of the following:

Financial Services areas:
Regulation & Ethics
Investment Principles & Risk
Personal Taxation
Pensions & Retirement Planning
Financial Protection (Level 3)
Financial Planning Practice

All new qualifications must cover the key areas as listed above and all Retail Investment advisers must demonstrate that they have met the new AES in order to meet the RDR qualification requirements.

However, under their 'no regrets' policy, the FSA stated that individuals who already hold, or are studying towards, an existing Level 4 appropriate qualification* would not need to sit further
examinations but may need to carry out 'qualification gap-fill' to meet any gaps in knowledge between the qualification held and the new modernised Appropriate Exam Standards.
*A full list of all approved appropriate qualifications (old and new) can be found within TC Appendix 4 of the FSA Handbook.

Download the full paper here »


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