FPC009_AI1_v11 Instructions

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Kaplan Business School *

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Apr 26, 2024

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Document classification: Confidential FPC009 Complex Financial Planning Assignment 1 Instructions Assignment 1 marks: 95 | Referencing and presentation 5 Total marks: 100 Total word limit: 3,000 words Weighting: 40% Download and use the Assignment Answer Template provided in KapLearn to complete your assignment. Your assignment should be loaded into KapLearn by 11.30 pm AEST/AEDT on the due date. Refer to ‘Time remaining’ on the ‘Assignment’ page in KapLearn to ensure you submit your assignment by the specified due date and time. Learning outcomes (LO) mapping Marks LO1 Engage clients in an ethical and professional manner to determine client needs and priorities through the financial planning process. 44 LO2 Interpret client behaviour through the application of client engagement methodologies. 8 LO3 Identify and critique strategies and formulate solutions for complex client situations. 27 LO4 Construct a comprehensive client record including appropriate advice and other documents relevant to the financial planning process. 16 Referencing and presentation 5 Total marks 100

Document classification: Confidential FPC009_AI1_v11 2 © Kaplan Higher Education Assignment 1 details • This assignment covers Topics 2 to 4 and accounts for 40% of your final grade. • There are six (6) questions in this assignment. Answer all questions. • Your overall mark for this assignment will be rounded to the nearest whole number. • Refer to the Criteria-Based Marking Guide for guidelines on what is expected for each question. • Full workings must be shown for all calculations. Show all calculations in the text of your assignment and not attached as an appendix. Appendices to the assignment will not be read. • Indicative weightings are noted beside each question. Use these weightings to assist you with your allocation of time and resources. The weightings indicate the relative importance of each question. • State all assumptions used in providing your answer. Policies • Marks will only be awarded for answers up to the word limit (plus 10%) for each question . Any material written after this will not be counted towards your mark for that question. Headings, quotes and references within the body of the answer are included in the word count. Numerical tables, calculations and reference lists are not included. For more information on word counts and their rationale, go to Assessment → Assignment 1 → Assessment Preparation Guide . • The Assessment Preparation Guide contains information about format and presentation, word limits, citations and referencing, collusion, plagiarism and other policies, useful resources, submitting your assignment and accessing your results. • Answers are to be in your own words. Reference and cite all your sources (within the text of your answer) when quoting or using material from external sources. Include a reference list at the end of your assignment. • Use of the Harvard referencing style is recommended (as per Kaplan Australia: Harvard Referencing Guide, available from the ‘Referencing and Research’ section of the ‘Build Your Skills’ hub in KapLearn), but the consistent application of any other referencing style will also be accepted. • Requests for special consideration or information pertaining to special consideration written in the body of the assignment will not be considered by the assessor. Refer to the ‘special consideration’ section of the Assessment Policy on Kaplan’s website for more information.

Document classification: Confidential FPC009_AI1_v11 3 © Kaplan Higher Education Part 1: Instructions for completing Assignment 1 Background to the assessment tasks As a financial adviser, you must provide advice to your clients which is in their best interests and demonstrate that the advice will place them in a better position. The assignments in this subject are designed to enable you to critically assess these aspects of advice when the advice has been provided by another financial adviser and to apply this critical thinking when providing your own advice to clients. In Assignment 1, you will be assessed on your ability to critically analyse the advice provided to Paul and Sue Dee, and to assess whether: • the advice provided satisfies the key elements of the financial adviser’s best interests duty owed to their client • it is likely to put them in a better position if implemented • in addressing the previous two points, there are errors or omissions in the advice, when compared to the information gathered about the clients. A ‘file’ of materials relating to the advice provided to Paul and Sue is included as part of this assignment. This material is contained in Part 3. The following documents are included in the file: • a client data form completed by the financial adviser following discussions with Paul and Sue Dee • file notes created by the adviser • a completed statement of advice (SOA) that you can assume was presented to the clients. Required tasks Following your analysis of all the materials in the file, you are required to respond to six (6) questions about the advice provided in the SOA which Paul and Sue Dee may rely on. Some questions have multiple tasks. Note: You will need to compare information collected about the clients during the fact-finding exercise and meetings (file notes) to statements (or omissions) in the SOA.

Document classification: Confidential FPC009_AI1_v11 4 © Kaplan Higher Education The questions You shou ld read all the materials provided with the assignment carefully, so you understand the clients’ financial situation, attitudes, goals and values. Read the assignment questions in Part 2 and start to make your own notes on where you believe a potential conflict or error seems to have arisen and, correspondingly, where you believe the advice provided appears valid. In responding to each of the assignment questions, you will need to refer to the ‘safe harbour’ requirements that a financial adviser should adhe re to, pursuant to the ‘best interests duty’ obligations. When you begin to compile your responses to each of the questions, make sure you read each one carefully because the wording will provide guidance on what is required. For example, where you are asked to provide an answer and reasons for your answer, marks will be allocated to both the answer and the reasons. If you only address part of a question or your answer is deemed inadequate, marks will be deducted. Word count Word limits for responses are provided for each question. The total word limit for this assignment is 3,000 words. Your responses should be clear and concise yet comprehensive enough to satisfactorily answer each question, while remaining within the word limits for each question. Some questions require only short answers while others may require more detail. You will need to refer to ASIC regulatory guides and information papers, and research websites in preparing responses to some of the questions, for example, ASIC’s Regulatory Guide RG 175 and Information Sheets INFO 205 and INFO 206. You should also ensure you refer to the obligations imposed by the Financial Planners and Advisers Code of Ethics 2019 (Code of Ethics). The following required readings, which are included in your topic notes, will also assist in understanding these obligations: 1. Financial Adviser Standards and Ethics Authority (FASEA) 2019, Financial Planners and Advisers Code of Ethics 2019 , Australian Government, 8 February, retrieved 1 November 2022, < https://www.legislation.gov.au/Details/F2019L00117 >. 2. Financial Adviser Standards and Ethics Authority (FASEA) 2019, Financial Planners and Advisers Code of Ethics 2019 – Explanatory Statement , Australian Government, 11 February, retrieved 1 November 2022, < https://www.legislation.gov.au/Details/F2019L00117/Explanatory%20Statement/Text >. 3. Financial Adviser Standards and Ethics Authority (FASEA) 2019, FG002 Financial Planners and Advisers Code of Ethics 2019 guidance , FASEA, retrieved 1 November 2022, < https://www.afa.asn.au/wp- content/uploads/FASEA-Financial-Planners-and-Advisers-Code-of-Ethics-2019-Guidance.pdf >.

Document classification: Confidential FPC009_AI1_v11 5 © Kaplan Higher Education Part 2: Assignment questions Question 1 (5 marks | Word limit: 150 words) The personal details collected about the clients are recorded in the SOA: ‘Section 1: Where you are now ’. Describe at least one (1) piece of relevant information relating to the data collection process for Paul and Sue Dee that should have been referred to in Section 1 (2 marks). Briefly describe a consequence this omission or error may have on the appropriateness of any advice provided to the client (3 marks) Criteria-Based Marking Guide for Question 1 Excellent (Range: 4 – 5 marks) Satisfactory (Range: 2.5 – 3.5 marks) Unsatisfactory (Range: 0 – 2 marks) • answer exceeds satisfactory standard with more than one (1) relevant piece of information • comprehensive reasoning for why the information should have been included, such as considered discussion of the consequences of its omission • at least one relevant piece of information is identified • adequate reasoning for why it should have been included and discussion of the consequences of its omission • incorrect information or no relevant pieces of information provided • irrelevant or no consequences discussed Question 2 (10 marks | Word limit: 400 words) The following questions relate to the development of an appropriate investment strategy for a client, which can be affected by their attitude to investment risk. (a) Describe whether ‘Section 3: Your risk profile’ of the SOA correctly reflects both clients’ attitudes to risk. (4 marks) (b) What (if anything) should the SOA in Section 3 have stated about the clients’ risk profile? Explain your answer. (3 marks) (c) Should the clients’ risk profile be the key factor in the construction of an appropriate asset allocation model? Why or why not? (3 marks) Criteria-Based Marking Guide for Questions 2(a) – (c) Excellent Satisfactory Unsatisfactory (a) (Range: 3 – 4 marks) (Range: 2.0 – 2.5 marks) (Range: 0 – 1.5 marks) (b) (Range: 2.5 – 3 marks) (Range: 1.5 – 2 marks) (Range: 0 – 1 mark) (c) (Range: 2.5 – 3) marks (Range: 1.5 – 2 marks) (Range: 0 – 1 mark) • answer comprehensively addresses all components of the question(s) and provides well-articulated, valid and relevant supporting reasons • answer adequately addresses all components of the question(s) and provides valid and relevant supporting reasons • does not adequately address the components of the question(s) with no valid or relevant supporting reasons

Document classification: Confidential FPC009_AI1_v11 6 © Kaplan Higher Education Question 3 (40 marks | Word limit: 1,200 words) ‘Section 4: My advice to you and why it is appropriate’ of the SOA details the course of action the Dees should be considering (i.e. the financial adviser’s recommendations). The recommendations the Dees should consider are summarised in Section 4. (a) Describe at least three (3) technical statements made in Section 4 of the SOA that are incorrect. Explain your answer. (9 marks) (b) In S ection 4 under ‘Superannuation advice’, the financial adviser has recommended that Paul and Sue establish an SMSF to roll over existing superannuation balances and to undertake the purchase of a property with borrowings. Identify five (5) key disadvantages of commencing and operating an SMSF that the adviser has omitted. (10 marks) (c) ‘Insurance advice’ in S ection 4 addresses the clients’ insurance needs. (i) Is the needs analysis undertaken and described appropriate to the clients’ circumstances? Give reasons for your answer, including amounts where appropriate. Note that tables do not count towards the word limit. (8 marks) (ii) Are there any inconsistencies between the needs analysis and the insurance recommendations? (3 marks) (d) Consider ‘Investment advice’ in Section 4. (i) What statements made under ‘Investment advice’ appear to be inconsis tent with information that has been collected about the clients and their circumstances? Explain your answer. (5 marks) (ii) What are the key advantages and disadvantages of the ‘Investment advice’ recommendations (you may need to consider best interests obligations)? (5 marks) Criteria-Based Marking Guide for Questions 3(a) – (d) Excellent Satisfactory Unsatisfactory (a) (Range: 7 – 9 marks) (Range: 4.5 – 6.5 marks) (Range: 0 – 4 marks) (b) (Range: 7.5 – 10 marks) (Range: 5 – 7 marks) (Range: 0 – 4.5 marks) (c) (Range: 9 – 11 marks) (Range: 5.5 – 8.5 marks) (Range: 0 – 5 marks) (d) (Range: 7.5 – 10 marks) (Range: 5 – 7 marks) (Range: 0 – 4.5 marks) • answer comprehensively addresses all components of the question(s) and provides well-articulated, valid and relevant supporting reasons • answer adequately addresses most components of the question(s) and provides valid and relevant supporting reasons • does not adequately address the components of the question(s) (with no valid or relevant supporting reasons)

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