FNS40815 & FNSASIC302: Statement of Advice Review - Client Solutions

This assignment focuses on reviewing a statement of advice (SOA) in the context of financial and mortgage broking, specifically addressing the requirements of FNS40815 Certificate IV in Finance and Mortgage Broking and FNSASIC302 Develop, present and negotiate client solutions. The task involves analyzing a sample SOA for John Smith, focusing on life insurance, income continuance insurance, and trauma insurance recommendations. The assignment requires assessing the adviser's compliance with industry regulations, evaluating the clarity of explanations regarding financial product characteristics and benefits, and determining the client's responsibilities in completing the SOA process. The review emphasizes the importance of disclosing relevant information, understanding risks, and ensuring the SOA aligns with the client's financial goals. The assignment also highlights the significance of clear communication between the adviser and the client to ensure a successful SOA process.

F NS4 0 8 15 C er ti fi c at e IV i n F IN A N CE & MOR TG A GE
B R OKIN G
F N SA S I C30 2 D e v e l op , pr e se nt and n e goti ate c li e nt s ol u ti o ns
Asse ssm e n t 2 -
P e rfo rm a n ce

Assessment information
You work as a trainee financial adviser with ZYX Financial Services Pty Ltd (ZYX).
As part of your training, your supervisor has asked you to review an example statement of
advice.
Instructions to complete this assessment
In order to complete this assessment, you are required to complete the following sections
consecutively. Details and specific instructions are provided within each section and on the
form/templates provided.
Supporting documents
To fi nd the relevant supporting d ocuments, please refer to t he Assessment R esource s
folder, located within the FNSASIC302 D evelop, present and ne gotiate c li ent solutions nee ds
se c tion of your course , or click the link above.
Section 1 – Review Statement
of Advice Requirements
Download and review “John Smith Statement of Advice November 2014”, located in the
Assessment Resources folder.
Section 2 – Assess SOA
Now complete each of the following steps:
1. John Smith has asked for advice about his life insurance, income continuance insurance
and trauma insurance. The SOA provides recommendations for each of these insurances
(P32). In order to comply with industry regulations, what must the adviser do before these
products transfer risk to the insurance companies?
Before advising life insurance policy, income continuance insurance policy and trauma insurance
policy to the client, it is the responsibility of the adviser that they should also communicate all the rules
and regulations. It is because compliance of industry regulation will help in reducing or mitigating the
risk attached with the policies. For this, adviser need to communicate with the John Smith that whether he
is having any smoking and drinking habit or not. It is because at the time when client need to use the fund
of the policy, the non-discloser of past diseases may cancel their request. Thus, it is important for the
client that they should comply with all the insurance rules and regulations provided by APRA. This
includes grace period, policy restatement, policy provision etc. Beside this, in order to reduce the risk of

the different policies advises to John Smith, it is also advisable to them is that they should also convey
family medical history. It is must in the case of income protection policy (Heeks, 2017). One of the most
significant compliance that every policy holder have to follow is driving records. It means whether client
has poor record of driving or good as it affects the policy to the large extent.

2. Has the adviser to John Smith clearly explained the characteristics, benefits and impacts
of switching financial products to John Smith?
Yes, the adviser has clearly state the characteristics, benefits along with the impact of financial
products to the clients name John Smith. Adviser has clearly state the benefits the clients will get if they
invest their funds or savings through superannuation funds and how such investment gave them benefit of
tax deductions. These deductions will helps in reducing the income of the client which further leads to
low income tax expenses. Further, adviser has also state the risk which is attached with their advice. The
risk is such that the actual investment does not meet the expected return of 6% per annum over the 10
years and it may be because of the changing economic conditions (Tommasetti, Troisi and Vesci, 2017).
In addition to this, the adviser does not provide any advice on the general insurance and minor transaction
cost attached with each recommendation is a disadvantage of their advice.
3. The SOA presents appropriate financial products and services to John Smith. What must
John Smith do now to successfully complete this SOA process?
The SOA prepared by the adviser covers all the appropriate and suitable financial products which
benefits the clients in achieving their goals and objectives. It means before specifying and recommending
any financial products, the adviser has clearly looked out the goals of John Smith. Now, it is duty of John
Smith that they should read the prepared SOA carefully & attentively or in case if they fail to understand
any point or recommendations they should communicate it with the adviser (Niknejad and et.al., 2020).
By doing this, John Smith able to successfully complete the process of SOA. The SOA is basically a
record of advice which must be written in clear and concise manner so that clients can understand what is
advice to them. In case, if they unable to understand SOA, then they unable to understand the advice
which is given to them. Thus, careful reading and communicating the document is the prime
responsibility of client.

Checklist for submission
Please use the following list to ensure the correct amount and type of documents have been
completed and are ready for submission.
Assessment 2: The file name should include your first name and surname,
i.e. Assessment 2_FNSASIC302_Jo Brown

REFERENCES
Books and Journals
Heeks, R., 2017. Decent work and the digital gig economy: a developing country perspective on
employment impacts and standards in online outsourcing, crowdwork, etc. Development
Informatics Working Paper. (71).
Tommasetti, A., Troisi, O. and Vesci, M., 2017. Measuring customer value co-creation behavior:
Developing a conceptual model based on service-dominant logic. Journal of Service Theory and
Practice.
Niknejad, N. and et.al., 2020. Understanding Service-Oriented Architecture (SOA): A systematic
literature review and directions for further investigation. Information Systems. 91. p.101491.