Keep your sword sharpened

Although every person in a practice should have a development plan, from this year, retail investment advisers’ CPD will be under the spotlight more than ever. Now we have the official introduction of accredited bodies, minimum structured and unstructured CPD hours, independence with broader CPD requirements, and the Statement of Professional Standing - a necessary document to practise.

What follows is an overview of the key CPD requirements and a consideration of issues related to the new regime.

Requirements

To show competence to their chosen accredited body, advisers should be able to demonstrate that they have:

• Addressed any learning gaps in their technical knowledge.

• Acquired knowledge so that they continue to meet their FSA requirements.

• Conducted these activities in a measurable fashion.

• Ensured that any such activities are capable of being verified by an accredited body.

• Demonstrated the ability to generate good quality management information.

In addition any such programme would need to:

• Enable advisers to complete programmes of structured and unstructured learning specifically produced to bridge gaps in their knowledge and meet their learning outcomes.

• Be e-measurable, for example a seminar with quantifiable attended hours.

• Provide access to a broad range of appropriate e-learning packages specifically designed to meet the appropriate learning outcomes, particularly useful for some advisers.

• Be capable of being verified by an accredited body.

• Have the ability to allow individuals to participate in seminars that have been specifically designed to meet particular learning outcomes.

When including seminars within the structured hours’ content, it is no longer acceptable to simply provide a certificate of attendance. A provider of CPD must be able to present advisers with the ability to demonstrate that they have learned, or further developed, relevant knowledge or skills. Please note that CPD does not have to be accredited for it to be recognised, but it does carry kudos.

CPD should be relevant to the adviser’s current and future role and professional development. As CPD is an individual requirement, not firm specific, advisers can focus on the outcomes relevant to their role. It is also important to note that some areas - such as protection, mortgages or equity release - are not covered in the RDR syllabus and are excluded for SPS purposes.

The FSA has defined structured CPD as “an activity that uses material or activities that are designed to achieve a particular learning outcome and capable of being independently verified”. They have also stated that each activity should require a contribution of 30 minutes or more. This can include participating in seminars, conferences, workshops, courses, and of course completing appropriate e-learning. Meanwhile, educational reading, to meet the required learning outcome, is also acceptable as a minority activity.

Structured CPD does not have to have a testing mechanism, however this facility could prove to be a good way to demonstrate an individual’s understanding. It also does not include carrying out research on products and services for your clients. The structured arena is where the bulk of your CPD time will be focused, and as stated earlier, a minimum of 21 hours need to be completed and evidenced.

Unstructured CPD has been defined as “using material that is not designed to meet a learning outcome”. Some of the above methods of completing your CPD can be used here to complete your minimum 35 hours.

Records

In this day and age, I would expect advisers to log their CPD activity on some form of computer based system, such as software provided by an accredited body. However, some PCs allow users to export data to accredited bodies independently of external software. Either way, computer-based systems are more efficient, safer, and allow for more streamline audits and SPS renewals.

Accreditation

Accredited bodies should ensure all advisers subscribe to their code of ethics, check the appropriate minimum qualification is held, conduct a sample check of CPD from 10 per cent of their users, and accept CPD activity from a range of providers. Although the regulator aims for a consistent approach in interpreting and monitoring professional standards through this route, in reality, accredited bodies will all have their own criteria within the parameters set, which can still be over and above the requirements.

Renewal

Chances are most advisers will take the path of least resistance when earning their SPS and opt for their accredited body when it comes to gaining their diploma. However, from this year the market could be a lot different with advisers having the opportunity to switch to a more cost-effective provider or one that offers more value to them with acceptable criteria.

It is important to know that the new era of CPD requirements will not be difficult to complete, 35 hours over 12 months will be more than achievable, especially with a range of traditional face-to-face seminars available. Also keep in mind that electronic portals, where you can record and conduct all your CPD needs under accredited body requirements as a standalone or complimentary offering, are the future.

Lee Travis is chief executive of the New Model Business Academy

An annual CPD programme would ideally allow advisers to:

• Identify bespoke learning gaps in technical knowledge.

• Provide the knowledge required to address these gaps.

• Provide a programme of learning designed to meet the FSA requirements of 35 hours of relevant CPD that is relevant to the current and future role and professional development (QCF levels four to six where appropriate).

• Incorporate within this total a minimum of 21 hours of measurable structured CPD, plus unstructured learning, including soft skills training (to a max of five hours).

• Include an automatic CPD facility that has the ability to record additional internal and external activities, with individual reflective statements, and store such items as certificates of attendance.

• Provide access to learning material that covers the basic competency requirements.

• Provide the management information required to demonstrate the relevant hours that have been completed.

• Be capable of being verified by an accredited body.

The three areas CPD records should cover are:

• Advisers’ individual needs: knowledge gaps and the target learning outcome.

• How these needs have been met: a description of the activity carried out including number of hours.

• Confirmation of how the adviser met those needs: how the activity has met the target learning outcome and, if tested, the result.

Key points

* CPD has always been a crucial part of an adviser’s role

* When including seminars within the structured hours’ content, it is no longer acceptable to simply provide a certificate of attendance

* CPD can include participating in seminars, conferences, workshops, courses and completing appropriate e-learning.