Contents
Summary of Changes
What are these dates
What is AdviserLogic doing
Frequently Asked Questions
ASIC Further Guidance
Setting Up Your Template
Summary of Changes
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Current |
From 1 July 2021 |
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Advisers charge an ongoing fee to the clients for the services they render. |
Advisers charge an ongoing fee to the clients for the services they render. |
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Advisers must provide a Fee Disclosure Statement (FDS) once a year. The FDS provides the client with the following details:
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Advisers must provide an Enhanced Fee Disclosure Statement (FDS) once a year. The Enhanced FDS provides the client with the following details:
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The client must opt-in into the service once every two years. To facilitate this, a Renewal Notice is provided to the client every two years. The Renewal Notice outlines the details of the services and estimate of the cost for the upcoming service period. |
The client must opt-in into the service once a year. The renewal notice is no longer required, but it is replaced by the Enhanced FDS (see above) |
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The new service period can be on different dates to the previous year. It is dependent on when the renewal notice is provided. |
The new service period is on the same day and month each year. |
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Once initial consent is to debit fees has been received, there is no ongoing requirement to renew or obtain new consent. |
Prior to fees being deducted, written consent must be obtained. The consent to debt fees is only valid until the end of the service period PLUS an additional 150 days. Eg. if the service period expires on 30 Jun 2022, the consent is valid until 27 Nov 2022. Consent must be obtained each year. |
What are all these dates?
To ensure these obligations are met in a timely manner, specific dates now must be adhered to.
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Start Date of Ongoing Fee Arrangement Period |
The date the Ongoing Fee Arrangement Period commences |
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End Date of Ongoing Fee Arrangement Period |
The date the Ongoing Fee Arrangement Period ends |
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Anniversary Date |
End of the Ongoing Fee Arrangement Period + 1 day. |
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Enhanced FDS Due Date |
This is the latest date the enhanced FDS must be sent. |
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Ongoing Fee Arrangement - Renewal Date |
This is the latest date the Enhanced FDS must be signed by the client |
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Consent Termination Date |
This is the date the consent for the current Ongoing Fee Arrangement expires |
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Consent Notification to Provider for Termination |
This is the latest date the adviser can notify the Provider to terminate the current consent. The adviser has 10 business days to notify the provider upon receiving confirmation from the client that they no longer wish to continue the Ongoing Fee Agreement. |
What is AdviserLogic doing?
With the new legislation coming into effect on 1 July 2021 for Ongoing Service Agreements, our team is working hard to ensure that you will be able to meet your compliance obligations easily and efficiently.
Based on that, we will be delivering these enhancements over two key stages:
Stage one - Release Date 1 July 2021
Enhanced FDS template to allow you to meet your obligations – you can see the sample here (Please contact the AdviserLogic Support Team if you require this to be available before 1 July 2021).
We will be releasing an Individual and Bulk Enhanced FDS template
Both templates will provide the following:
- Services that have been provided
- Actual cost for the services for that service period.
- Services that are to be provided in the upcoming service period
- Cost (or estimated cost) for the upcoming service period.
The document will populate based on the data inputted into our Ongoing Fee Advice module (currently called FOFA Compliance)
Additional Notes:
- For both templates, services entered for the previous year will be used to populate the services for the upcoming service period (therefore if these are different you will need to edit the output).
- For the Individual template, the cost (or estimated cost) for the upcoming service period will not be populated (therefore you will need to edit the output)
- For the Bulk template, the cost (or estimated cost) for the upcoming service period is assumed to the same as the previous service period (therefore if these are different you will need to edit the output)
Stage two - Release Date Q3 2021
Enhanced Fee Compliance module (replacing the existing FOFA Compliance page in Fact Finder) - it will allow you to keep track of your clients and services provided as well as date reminders to ensure you do not miss any important dates.
What exactly does Stage 2 provide?
- Ability to view, update and track various Fee Disclosure stages such as:
- Details of services provided and cost in the previous year
- Details of services provided and estimated cost for the current year
- Whether the client has agreed to proceed with the service
- Whether the client has provided consent forms for debiting fees
- Termination date of consent forms.
- Ability to maintain an audit trail by attaching documents at each stage.
We'll continue to enhance these features to further increase the efficiency in meeting compliance obligations
What's happening in Stage 2
Tracking of dates, to ensure you send out the required correspondence on time and continue to meet your obligations.
Example: Enhanced FDS has been sent out and waiting on client response
Example: Client has renewed. The action is now to provide the consent form to the platforms for renewal
Example: Client has declined to renew. The action is now to inform the Platform provider of the Consent termination date.
Recording the Services the clients are entitled to and have received and the actual cost
Recording the Services the clients will be receiving along with the estimated cost for the next year
Future Stages - Anticipated in Q4 2021
Renewal Confirmation and saving of documents
Enhancements to provide better estimates by taking into account contributions and withdrawals
From the ASIC FAQ - 16. What ongoing fees do I need to disclose in an FDS for the upcoming year?
A reasonable estimate
A reasonable estimate should be based on all of the relevant information available to the fee recipient at the time the estimate is made. It should also reflect the fee recipient’s most accurate account of the client’s position at that time.
For example, when the fee being charged is an asset-based fee, the information could include:
- employer contributions that are expected to be made throughout the year to a client’s superannuation fund
- additional investments that may be made by a client based on the advice provided, and
- any known large withdrawals to be made during the following 12 months.
Frequently Asked Questions
What is the Enhanced FDS
Essentially, it is the Fee Disclosure Statement and Renewal Notice rolled up into a single document
Will AdviserLogic be providing Consent Forms
Not at this stage. We have spoken to several platform providers who have indicated they will be providing their own Consent forms.
To ensure a seamless transaction (and to avoid generic consent forms being rejected by Platform providers), it is advisable to use the consent forms provided by the specific Platform provider.
Forward-looking fee. Can the previous year's fees be included as default?
Yes. This is applied to the Bulk Enhanced FDS template.
Dates that will transfer to the new Compliance page
The Application date and Disclosure date will be transferred to the new page.
(Note: Disclosure date is to be renamed to Anniversary date)
Is the FDS Application Date start date going to change to be called the “Anniversary Date”
The anniversary date will have a start date and an end date period to cover scenarios where FDS is needed for a period of more than 1 year or less than 1 year, by default period will be 1 year.
Will the Anniversary date/Opt-In renewal start date going to link with the next Review date in the Basic Info section?
No
New annual dates and how this will be reflected in the system to keep track while phase 2 is being built.
The disclosure date can be updated in the existing FOFA compliance screen to reflect the new anniversary date. We will migrate the data from the FOFA compliance section to the new Service fee disclosure section wherein we will also update the Anniversary date field with the Disclosure field date. The rest dates are auto-calculated based on the anniversary date so you are not required to maintain them.
How to request template changes to the new FDS templates
Contact the AdviserLogic Support Team who will arrange for an Implementation Consultant to contact you.
Where to locate further guidance on the new ongoing fee requirements
ASIC has also provided a FAQ. You can find the information by clicking on this link.
How to set up the new templates via quick docs
Go to Tools > Practice Management > Quick docs.
(Note: You will require Admin access for this)
