Advisers have continued to raise concerns about a new section of the FSA’s retail mediation activities return form, with one claiming it was a “nightmare” to comply with.
Andy Jones, of Leicestershire-based Beneficial Financial Management, said he was currently working on section K of the form, which required firms to provide data on adviser-charging revenue, payment methods, client numbers and charging structures.
Commenting on advisory forum LifeTalk, Mr Jones said he would now have to ask product providers whether they can supply figures that will separate pre-Retail Distribution Review trail commission and post-RDR adviser charges to complete the form correctly.
He cited many difficulties in reporting the disparate data.
Mr Jones’s concerns were echoed by Tim Page, director of Suffolk-based IFA Page Russell, who said he had “struggled” with the return since October, while the solution he used supplied by software provider Avelo “required a master’s degree to get to grips with”.
Last month Barry Pitfield, managing director of Guernsey-based adviser software provider JCS, described the return, and specifically section K, as “fundamentally flawed” and said it placed a “huge administrative workload” on advisory firms.
He claimed to have proposed a complete redesign of section K and more guidance from the FSA as the form could not be completed correctly by advisers in some cases, such as when invoices remained outstanding at the end of an investment period, or when some payment methods were unknown, speculative or subject to change dependent on the type of investment.
A spokesman for the FSA said that the regulator had no plans to change the return process.
The regulator has so far issued three final notices to firms this year for failing to submit their retail mediation activities return form on time, resulting in the cancellation of permissions and fines.
The FSA spokesman said that should a firm find that section K was misrepresentative, such as if the firm could not work out a mechanism through which an adviser charge would be facilitated, “it had an opportunity to resubmit the return”.
Richard Johnston, managing director of Staffordshire-based DJH Wealth Management, said: “I agree that the reporting is flawed. I had read about the changes from our compliance support provider and it looks like a manual approach is the only workable solution.”
