Superannuation Choice, ASIC and Compliance: The 'Choice Regime' Will Have a Significant Impact on Trustees, Employers, Employees and Their Financial Advisers. as Part of Its Professional Education Program, the SIA, Now ISFB, Has Collaborated on a Super Choice Campaign for Advisers and Compiled a Simple Checklist for Advisers and Clients on Super Switching

Journal of Banking and Financial Services, June-July 2005 | Go to article overview

Superannuation Choice, ASIC and Compliance: The 'Choice Regime' Will Have a Significant Impact on Trustees, Employers, Employees and Their Financial Advisers. as Part of Its Professional Education Program, the SIA, Now ISFB, Has Collaborated on a Super Choice Campaign for Advisers and Compiled a Simple Checklist for Advisers and Clients on Super Switching


The Federal Government's choice of fund policy became effective on 1 July following the introduction of the Superannuation Legislation Amendment (Choice of Superannuation Funds) Act 2004 (the Choice of Fund Act).

The Securities Institute of Australia (SIA) equipped its financial advisers with the tools to obey the rules on superannuation choice prior to implementation in July. Financial advisers are working in the front line of the new Super Choice regime and CEO, Brian Salter, has noted that 'It's up to advisers to observe the rules laid down by the Federal Government and so protect consumers' retirement incomes'.

The SIA's policy and professional education teams collaborated on a super choice campaign for advisers that includes: a short guide for licensed representatives entitled Super Choice No 'Ifs' No 'Buts'; a seminar series with ASIC participation; and an online professional education program.

Policy and advocacy at the ISFB

The ISFB has a well-developed policy and advocacy function, which is committed to raising standards in the securities and financial services industry by providing practical, contemporary and innovative education, fostering ethical and effective markets, and advocating high levels of professional conduct.

To facilitate its advocacy role, the ISFB has a number of specialist policy committees representing the broad membership of the Institute and reflecting the current legal, regulatory and policy reform issues within the financial services industry. Our Super Choice campaign was steered by the Financial Advising Committee, which is responsible for considering broad and technical policy in relation to superannuation, retirement incomes and financial planning.

Role of ASIC in choice

The Australian Securities and Investments Commission (ASIC) supervises the licensing and disclosure obligations of industry participants. Its primary role in the new choice regime will be to monitor compliance.

ASIC Chairman, Jeffrey Lucy noted on 15 April 2005 that ASIC's aim is to ensure consumer and industry confidence by 'demanding appropriate standards of advisers and fund managers and helping consumers make informed decisions'. He emphasised that financial services providers will be monitored and 'we (ASIC) will take action if they fail to meet their significant obligations under the law. These obligations include the need to provide good professional advice supported by appropriate documentation'.

ASIC will conduct shadow shopping exercises on Super Choice in relation to the advice that consumers receive. As part of this process, ASIC will undertake audits on Statements of Advice and other disclosure documents.

Specific ASIC concerns

Consumers considering switching funds, and advisers on these matters, need detailed information on, and an understanding of, the issues surrounding:

* The default fund;

* The fact that choice of funds is not the same for each employee, as it may depend on the type of fund they belong to, personal circumstances, their award or employment agreement;

* How difficult it can be to compare different funds;

* Possible 'trade offs' required when switching from one fund to another; and

* How fees, charges and investment return can impact on the final payout.

ASIC has indicated that it will release a Guide to Super Switching Advice. In the meantime, the ISFB compiled the following simple checklist for advisers and clients.

The ISFB would not want to see a situation occur like that in the UK where billions of pounds of retirement savings were lost through 'mis-selling' practices after Choice was introduced in 1988. We look forward to continuing our dialogue with politicians and regulators as the choice regime is implemented.

This article is not an exhaustive or technical guide to the law. It is provided for information purposes only.

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Superannuation Choice, ASIC and Compliance: The 'Choice Regime' Will Have a Significant Impact on Trustees, Employers, Employees and Their Financial Advisers. as Part of Its Professional Education Program, the SIA, Now ISFB, Has Collaborated on a Super Choice Campaign for Advisers and Compiled a Simple Checklist for Advisers and Clients on Super Switching
Settings

Settings

Typeface
Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.