As Mifid II looms over the financial industry, advisers are in a race to be ready.
A recent survey by platform provider Nucleus found less than half were confident or very confident that they would be ready for the implementation of the EU regulations, which are set to come into force in January.
The survey of more than 200 firms also found that almost half had a neutral view on their readiness. Only 17 per cent thought the Mifid II changes were fair, while 14 per cent envisioned an increase in fees because of the implementation.
Like many advisers, Minesh Patel, director at EA Financial Solutions, and his staff are doing various things to get themselves ready.
Mr Patel said: “I have not really encountered any firm that is completely ready. The information about Mifid II has been out there, but it is now looming. We are trying to get to grips with it by attending courses.”
To help advisers, Nucleus has partnered with consultancy firm Zero Support to launch a report on Mifid II, called Mifid II: A Guide for Financial Advisers.
It provides information and practical action points on getting businesses compliant with the new regulation ahead of its introduction on 3 January 2018.
These include: keeping a register of all conflicts of interest and reviewing whether their firm needs further qualifications, training or permissions to maintain independent status.
Advisers should also review their recruitment procedures and assess if they need tightening.
For those who use discretionary fund managers (DFMs), advisers should check if their DFM or platform will offer online reporting access to avoid the need for paper reporting and, where model portfolios are being used, whether the responsibility for regularly checking suitability sits with the adviser.
Barry Neilson, chief customer officer at Nucleus, said: “There are still areas which require clarification, but given there is not long to go until the implementation date, there is a significant risk the industry will not have the opportunity to collaborate.
“We may find ourselves in a situation where firms are interpreting the rules about issues such as charges and fees aggregation in different ways, resulting in less consistency and more confusion.”
Ima Jackson-Obot is features writer at Financial Adviser
