Assessment 2 (Formulate) – Statement of Advice (35%) Objective: To formulate and present appropriate financial solutions tailored to the client’s circumstances, goals and objectives. Skills acquired:  Thinking;  Evaluating;  Creating; and  Professional. You have had the first interview with the client and have all the necessary information to prepare a financial plan. You have clarified the client’s goal and objectives and obtained a signed confirmation to proceed through the TOE. With the information, you have the basis for formulating your advice. This is to be done through a document called the Statement of Advice (SOA). It will outline your recommendations for the client to achieve his/her goals and objectives. This document will also be used to present your recommendations in the second meeting (Plan Presentation). This presentation will occur on the 26th of October 2015. More details regarding the presentation will be provided in the next section. 3.2 Assessment 2 Marking Criteria Marks will be awarded for their ability to produce a financial plan that clearly explains your recommendations. The financial plan must comply with the various financial services regulations and adhere to FPA’s Code of Ethics and Rules of Professional Conduct. A guide to the allocation of marks is as follows: Percentage Pages Item  7% 3 Front cover, letter & executive summary  10% 3 Scope of advice & personal/financial Information  8% 1 Goals, objectives & issues  3% 1 Risk profile  18% 4 Debt & cash flow management  14% 3 Wealth creation & investment advice  4% 1 Taxation planning  18% 4 Risk management & insurance advice  4% 1 Estate Planning  4% 1 Retirement & superannuation  7% 3 Compliance  3% Appendices Approximately 25 pages excluding appendices. 3.3 Assessment 2 Marking Guidelines Assignments that will not make the grade are those that:  reproduce substantial sections of textbooks, product disclosure statements, paragraphs from websites and similar, but without illustrating an understanding of the content;  reveal little understanding of the scope of the case study;  made no attempt to analyse the issues or produce a coherent answer;  contain irrelevant material;  offer solutions not directly targeted at the clients or present them without clearly explaining why they are appropriate. Assignments that will be acceptable are those that:  go beyond a simple listing of concepts;  attempt to analyse the clients’ situation;  make assumptions that show the level of investigation taken;  show some evidence that you are able to apply the unit’s concepts;  contain no irrelevant content;  explain clearly why all solutions present are appropriate for the clients;  compare and explore the validity of various options, strategies and products. Assignments that will attain a good grade are those that:  show evidence of planning and effort, reading and understanding;  show evidence of deeper level research and currency of response;  attempt to evaluate all issues, indicating the criteria by which a judgment is made and providing evidence to support the judgment;  attempt to bring together knowledge acquired from different units;  attempt to produce strategies or solutions that are appropriate, clearly explained and contrasted with those that are not selected;  cover the topic in full and possibly explore the fringes of the question;  are relevant and accurate. 3.4 Assessment 2 Format You are to refer to Chapter 4 of Taylor for details on the construction of the SOA. The following structure is to be used in your SOA; no other formats will be accepted: 1. Covering Letter 2. Cover Page 3. Executive Summary a. Personal details b. Goals and objectives c. Recommendations d. Expected outcomes/projections 4. Table of Contents 5. Basis for Advice a. Full Client Details b. Goals and Objectives c. Concerns and Issues d. Risk Profile e. Assumptions 6. Recommendations a. Debt & cash flow management b. Wealth creation & investment advice c. Taxation planning d. Risk management & insurance advice e. Estate Planning f. Retirement & superannuation 7. Outcomes 8. Fees and Commissions 9. Disclosures 10. Disclaimers 11. Review 12. Implementation Schedule 13. Authority to Proceed 14. Appendices 3.5 Action steps  Ensure that you have read Chapter 4 of Taylor.  Review the answers of the TOE (assessment 1) provided by the lecturer and make sure the information is correct. Transfer the summarised client information into your SOA. This information will constitute the Basis for Advice.  List down all the goals and objectives, issues and concerns. Under each point, list all possible strategies applicable, conduct research and document the advantages and disadvantages. Select the most appropriate strategy. Details of your alternative strategies should be included in the appendices. Do not attach brochures, product disclosure statements, research profiles, materials from independent research companies, insurance quotations, prospectuses or any advertising material.  Check to see that you have addressed every area. Your SOA should be about 20-25 pages in length excluding appendices.  Ensure that all pages are numbered sequentially (including appendices), tables, graph and appendices have headings and are properly referenced with page numbers. 3.6 Important notes  Please ensure that your executive summary is a complete summary of your whole document as you may need to refer to it when you conduct your client interview.  You do NOT need to recommend any products. Just concentrate on recommending solutions. Do NOT promote any products. For example, you can recommend investing in a managed fund, but not Colonial First State.  This is an individual assignment. SOAs with similarity index of more than 30% will be investigated and sent to Curtin student disciplinary panel. 4.1 Assessment 3 (Articulate) – Plan Presentation (10%) Objective: To verbally present the recommended strategies in a clear, succinct and professional manner. Skills acquired:  Apply discipline knowledge;  Information skills;  Communication skills; and  Professional skills. After formulating the strategy and documenting it clearly in the SOA, you are now ready to make an appointment to present the plan to the client. The client will be a practicing financial planner from the industry. This is scheduled for the 26th of October 2015. Location will be provided later in the semester. You are given 15 minutes to present your plan. As the time is very limited, you are only required to address 1-2 of the client’s concerns. Marks are awarded for keeping to the allocated time. You are to ensure that you run through your presentation with someone else prior to the interview. If you are unable to be present for the client interview, please inform the unit coordinator to make arrangements to present your SOA before the 26th of October. No presentations will be allowed after this date. 4.2 Assessment 3 Marking Criteria Marks will be awarded for their ability to:  20% Initiate the conversation and engage the client  20% Summarise the client’s goals and establish the scope  10% Present the solution clearly  40% Clear, concise and professional presentation  10% Time management and overall experience A copy of the marking guide is found in Appendix C. 4.3 Important notes  The interview style should be casual but respectful. Did you relax the client in what would presumably be a slightly threatening environment?  Eye contact and engage with the client; do not just read off your document.  Try running through the interview with a friend not doing this unit; they can give you some feedback.  Always pause to check if the client understood what you said.  Invite the client to ask questions; that is the best way to ensure they are engaged.  Ensure you place tabs at the side of your SOA to help you locate the important areas.