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Earning CFP® certification means fulfilling requirements in the 4E’s of a profession — Education, Examination, Experience and Ethics. In the next few issues, FPSC Bulletin looks at the specific 4E’s of CFP certification, starting here with this conversation about the CFP Examination with Financial Planners Standards Council’s (FPSC’s) new Vice President, Standards & Certification John Wickett. John has a PhD in psychology and psychometrics from the University of Western Ontario and 10 years of experience working with different Canadian certifying and licensing bodies. He brings extensive knowledge and experience to his new role at FPSC.
Bulletin: John, how does FPSC ensure the CFP exam is credible as a professional standard and fair to candidates?
John: Firstly, the content has to be sound. FPSC works diligently to ensure this is a fully competency-based exam that reflects what financial planners must do in practice to perform their role. Our approach tests critical thinking, not just memory. We do this by creating scenarios in multiple choice questions that test the ability to appropriately apply knowledge across a wide range of financial planning domains. Secondly, to meet our obligation of protecting the public and provide a fair testing opportunity for candidates, we have to set a pass mark that is as objective as possible. The chance of passing should be determined only by your ability, not by your ability relative to everyone else. To ensure fairness in calculating a pass mark, FPSC combines the professional judgment of expert CFP professionals together with numerous statistical analyses. The result is a mark that reflects whether a candidate does or does not have sufficient competence to act independently as a financial planner, according to the standard set by the professional community.
B: Please comment on the Exam’s ongoing development.
J: There’s always new content being developed for the exam, always new tax rules, rules around retirement. Currently in play is the introduction of the new competency profile, which came into effect for the November 2007 exam. In developing that profile, we went out to CFP professionals to clearly define what a CFP professional is and what they can be expected to perform in Canada.
B: What is the relationship between the competency profile and the exam?
J: The competency profile testing is embedded in the exam. We use a blueprint that guides us. It’s a weighting process that gives more weight to the more important competencies. We determined what was most important by surveying CFP professionals across the country and finding out how critical each competency was to effectively providing financial planning services. We wanted an exam that truly reflects the real-world experience of our CFP professionals in working with clients. That is what we believe we now have. The processes and linkages can get complex, but we can directly tie every item on the CFP Examination to a competency that a financial planner must possess to be effective.
B: Any future changes to the exam contemplated?
J: We’re in the process of working towards a staged approach to certification. With this new format, candidates would first take a Level One Examination, which would likely remain a multiple choice format. Upon successful completion of Level One, and after having completed education and experience requirements, candidates would be eligible to sit for the Level II, final certification Exam. We have tested ideas with current students, candidates, CFP professionals, academics, other certification bodies, industry and other stakeholders. Based on their thoughts and suggestions we are currently working out the nature of the two-level exam format, content and process.
B: John, is cheating on the exam a large problem?
J: We’re seeing anywhere from one to four or five people each exam attempt-ing to cheat. And we’re catching them. We take every step necessary to protect the integrity of the credential. If we suspect someone, we push it. You’ll have every opportunity to defend yourself but if you’re found guilty, we’ll have zero tolerance.
B: John, I guess the bottom line is public credibility. How can the public be assured that the CFP Exam protects their interest?
J: First, I think there is the soundness of the process I just described. I have worked with dozens of professional credentialing programs, and FPSC’s examination process ranks among the very best for diligence and thoroughness. Secondly, we’ve undergone an audit to find ways to further enhance our program. Thirdly, and this is looking ahead, we may pursue ISO 17024 certification — an internationally recognized, and very high standard for certification bodies to meet. Very few certifying bodies can meet that standard, but FPSC is well positioned, with minor tweaking, to do so. I should add that a big part of my agenda is to really beef up our enforcement of and adherence to our standards. We want to make sure the public has very easy access to our complaints process. We’re looking at an online capacity to register complaints on our website. We need to always remain open to improvement and cannot afford to become insular. We’re going to continue to revitalize the certification process, looking to other certification programs, the professional literature and our own best practice experience to keep FPSC’s certification program in the lead.
To review CFP standards, requirements and policies go to : The Professionals section of the FPSC website at www.fpsccanada.org.
Students today. Planners tomorrow.
CFP professional Geoffrey So speaks with students at a career recruitment event in the GTA. Geoffrey is one of many volunteers who have participated with FPSC staff in the career recruitment fairs across Canada. By providing “in the field” advice, volunteering CFP professionals generate interest in financial planning as a career and help to bring in a new generation of CFP practitioners.
FPSC and volunteering CFP professionals participate in career fairs and professional designation sessions across Canada. The goal: to generate student interest in earning the CFP credential. The FPSC booth provides the backdrop as planners offer their front-line views on the profession, and FPSC staff members provide information on earning the CFP credential. From Halifax to Vancouver, staff and volunteers collaborate to convey the value of earning the CFP credential to tomorrow’s planners.
This fall, FPSC distributed thousands of information pieces about the profession and the CFP credential. Often sharing space with other professional certifying bodies, FPSC sets itself apart by asking CFP professionals to volunteer their knowledge and personal experiences to interested students. Questions asked at these events range from “What is financial planning?” to “What are the merits of earning CFP certification as opposed to the CFA designation?”
“Earning CFP certification is the smart choice for would-be professional financial planners of tomorrow,” says Ann Bowman, VP Communications & Corporate Relations. “The interest in volunteering speaks directly to how rewarding CFP professionals consider their career to be — and this is precisely the message that needs to be communicated.”
FPSC thanks all volunteering CFP professionals who have donated their time and knowledge at career fairs across Canada.
In accordance with FPSC's Disciplinary Rules and Procedures, all complaints made against CFP professionals are investigated by the Director, Ethics. Where appropriate, these are referred to the Ethics and Practice Committee for a formal disciplinary hearing. This process helps to ensure protection of the public and protection of the reputation of the financial planning profession.
In each case, a Hearing Panel comprised of a member of the Ethics and Practice Committee and two additional volunteers from the CFP professional and to make a determination of whether or not there has been a breach of the CFP Code of Ethics. Where there is a finding of a breach of the Code, a range of sanctions can be imposed on the CFP professional, up to and including the permanent revocation of the right to use the CFP marks.
Since the last disciplinary report in FPSC's Bulletin, the following individual's right to use CFP marks has been permanently revoked:
Zarkadoulas, Anthony (Toronto, Ontario)
In June 2007, a Hearing Panel of the Ethics and Practice Committee issued a decision revoking Mr. Zarkadoulas' right to use the CFP marks, in accordance with a settlement agreement reached prior to hearing. In that agreement, Mr. Zarkadoulas admitted that he acted in breach of Rules 101, 102 and 601 of the CFP Code of Ethics. While employed as a Registered Representative in an IDA firm, Mr. Zarkadoulas improperly, and without authorization, transferred funds between unrelated client accounts.
After the transfers were discovered, his employment was terminated. Subsequently, he sought employment with another firm and in the course of seeking registration with the new firm, provided misleading information to a regulatory body. Mr. Zarkadoulas' right to use the CFP marks has been permanently revoked.
The following individual has received admonishment and continues to hold the right to use the CFP marks:
Hadden, Stacy (Kelowna, British Columbia)
In June 2007, a Hearing Panel of the Ethics and Practice Committee issued a Letter of Admonishment to Ms. Hadden after she admitted, as part of a settlement of the matter prior to hearing, that she was in breach of Rule 702 of the CFP Code of Ethics. Ms. Hadden had recommended and implemented a series of investments inside two RESP accounts that were subject to deferred sales charges and, under the circumstances, such investments were not suitable for the clients. Ms. Hadden agreed that she knew or should have known that such a strategy would likely result in the triggering of those charges at the time the funds were accessed for their intended educational funding purpose given the ages of the children involved. Ms. Hadden retained the right to use the CFP marks.
FPSC Bulletin made over for you
If this isn’t the first time you’ve seen FPSC Bulletin, you’ll notice we’ve put on a new face. The results of our recent survey of CFP professionals inspired us to try on a new look. They told us they liked FPSC Bulletin but wished it looked better. So, you tell us: how’d we do? We hope you like it enough to place it in your lobby or reception areas, your lunchrooms or your homes, where friends, colleagues and family can also enjoy it. The editorial team tries hard to back-up the “good looks” with substance — content that offers anyone interested in gaining insight into the profession of financial planning a good read.
Actuaries on fast track to CFP® certification
Fellows of the Canadian Institute of Actuaries (FCIA) can now qualify to write the CFP examination without formally completing further education courses. The Canadian Institute of Actuaries (CIA) worked with FPSC to have the FCIA credential recognized under FPSC’s approved prior credential (APC) program.
There is a growing demand for CFP certification among actuaries. They are responding to the changing needs of the market." The role of a number of actuaries is expanding to include advice to individuals, often employees of client organizations, about the management of their financial affairs, particularly with regards to their Defined Contribution Pension Plans,” says immediate pastpresident of the CIA, Norman Gendron.
“Increasingly employers and employees are seeking detailed advice about these plans, and actuaries are in a very good position to provide it.”
FPSC President and CEO Cary List says, “The fact that actuaries are seeking ways to pursue CFP certification to complement their professional practice is a welcome event. It acknowledges the unique set of competencies required in the professional practice of financial planning. From FPSC’s perspective, we recognize the rigorous and complementary nature of the educational paths of allied professions.”
Candidates must also satisfy other criteria, including three years of relevant experience.
Seminars work. Done properly they can generate a lot of interest in your local community. Seminars can help prepare audiences to take the next step in putting their minds at ease knowing they have their finances under control. A few organizations that have benefited from FPSC’s financial planning seminars: the Alliance of Independent Professionals; the International Association of Business Communicators; the Ontario Ministry of Finance; the Metro Toronto Reference Library and the Canada Customs and Revenue Agency (CCRA).
For information on how FPSC’s “Speaking of Money” program can help you deliver or organize a
financial planning seminar in your community, contact Heather Mills at 1.800.305.9886 x 235.
Canadian CFP profile model for new standard
FPSC leads the way to international standard
A competency profile for financial planners, based on a framework first conceived and developed in Canada, is now adopted as an international standard. The event occurred at the recent meeting in Salvador, Brazil, of Financial Planning Standards Board (FPSB), the international organization that owns the CFP marks outside the U.S.
The framework for the profile was first developed in Canada by Financial Planners Standards Council (FPSC) over a two-year period. FPSB, the international organization of which FPSC is the Canadian affiliate, struck a multinational team from Australia, Austria, Canada, Hong Kong, Japan, South Africa and the United States to establish a competency profile for the global financial planning community.
The goal both in Canada and internationally was to find a way of assessing and describing the abilities, skills and knowledge CFP professionals must have to serve the financial planning needs of their clients. The Canadian profile was used for the first time as the criteria for the November Canadian CFP Certification Examination.
FPSC President and CEO Cary List lead the team that developed the profile in Canada and was on the international team overseeing changes. He says, “It is very gratifying to see the seminal work we’ve done in Canada recognized internationally.”
Also at the meeting Jim Kraft, CFP, (VP of Marketing, Manulife Financial, Toronto) and member of the FPSC Board of Directors was elected to the Board of Directors of FPSB. His term of office will run from 2008 through 2010. The other Canadian member of the international board is Past FPSC Chair Peter Volpé, CFP, (Senior VP, Integra Capital Financial, Toronto), whose term runs through 2009.
“I’m very pleased to be chosen as a board member of FPSB,” says Jim. “I look forward to offering as much value as possible to the Board.”
MBA program recognizes CFP professional skills
Mark up a major milestone for the CFP credential. Dalhousie University has launched a new MBA stream that recognizes the high standards of competence CFP professionals employ in meeting the needs of Canadians.
Qualifying CFP professionals will now enjoy advanced standing in the MBA Financial Services (FS) program, enabling them to earn an MBA FS by taking one-third fewer courses. The MBA FS is tailored for professionals in the financial services industry, while not specifically a master’s degree in financial planning. FPSC aided in the program’s development.
Says FPSC President and CEO Cary List, “CFP professionals can now marry the skills and knowledge gained through an MBA with the knowledge, skills and abilities required to be a CFP professional.”
“The Dalhousie/FPSC partnership brings together the complementary advantages of a tailored program and real-life experience,” says Raymond Klapstein, Dalhousie Faculty of Management Associate Dean, Continuing Education. “Our focus on financial services professionals has allowed continued growth and learning in their careers.”
Adds Cary, “It’s particularly exciting to us that the universities are recognizing the important role of professional certification, and in particular, Dalhousie’s desire to collaborate with allied professions to deliver unique solutions tailored to students’ needs.”
Courses in the program include: accounting, advanced corporate finance, advanced marketing, business economics, international business, quantitative decision-making, information systems for the information age, management skills development, risk management, strategic leadership and change and two additional courses.
Know someone who has made a real impact on the financial planning profession? Submissions are now invited for the FPSC 2008 Donald J. Johnston Award. The annual Award honours those who’ve made a significant contribution to the financial planning profession in Canada. It was created to recognize the work of the FPSC’s first and founding CEO — and to inspire others to follow his lead.
Who’s Eligible?
Nominees may include any individual or groups of individuals. FPSC staff or members of the current volunteer FPSC Board of Directors or the Award Committee are excluded.
Recognition and Award
The recipient will be honoured at the Annual FPSC Board of Directors reception in spring, 2008. Award recipients will be announced in FPSC news releases, FPSC print and electronic communications and on the FPSC website.
Each recipient will receive a trophy, be named on FPSC’s award plaque located in its offices, and will choose the charity to which a $10,000 donation will be made.
Nominations due by December 21.
For details on how to make nomination(s), visit the www.fpsccanada.org site and click on the 2008 Donald J. Johnston Award banner.
“Life pressures”
Cited as a reason why Canadians delay planning
An October FPSC survey of CFP professionals suggests Canadians think of financial planning as something they intend to do, but don’t, because of life pressures.
CFP professionals across Canada were given a list of reasons why Canadians may tend to put off seeing a financial planner. About two-thirds of respondents cited procrastination because of life pressures as the top reason. One-third of respondents have the perception that Canadians believe it will be an overwhelming process, involving a lot of work that has to be done all at once.
According to Ann Bowman, VP Communications & Corporate Relations “Our lives really are full of pressures. However, Canadians need to be reminded that delaying getting their financial affairs in order through a comprehensive plan may mean needless sleepless nights. We worry about matters that, with the proper guidance, could be well under control. Without a plan, you risk missing opportunities and letting your musthaves drift into to the land of if onlys.”
As for the perception that it will be a lot of work on their part and has to all be done at once, Ann says, “Clearly planners need to help their prospective clients understand the value of financial planning. They need to know that the effort is worth it, but also that the process is life-long and can be managed in stages in a way that works for the clients. We’re doing our best at FPSC to deliver this message.”
Bottom line: sound financial planning is a timely investment that starts paying off the sooner you do it.
FPSC hits the road
Senior team talks with CFP professionals about the future
Face-to-face communication engages. With that truth in mind, FPSC President and CEO Cary List, FPSC Chair Cheryl Bauer-Hyde and FPSC VP Communications & Corporate Relations Ann Bowman recently visited central and western Canada, meeting with CFP professionals to talk about, among other things, FPSC’s new strategic plan.
Following are some of the topics discussed:
How FPSC is helping educators to standardize and refine curriculum for the evolving competency-based CFP certification examination
FPSC’s Student Associate program, and the importance of integrating future CFP professionals into the financial planning community as early as possible
The present relationship of the CFP credential to other professional designations and FPSC’s plans in this area
Says Ann, “Meeting planners on the ground is always an invigorating experience — one we hope is as engaging for them as it is for us.”
The conversations will continue in Ontario in 2008. There will be opportunities for sessions in Eastern Canada next year when the Board of FPSC meets in Newfoundland.
Audio recordings of the sessions will soon be available on our website at www.fpsccanada.org.
News you can use
Consumer brochures work
“What is financial planning? And why do I need it?” These are the questions compellingly answered in FPSC’s consumer brochures. The brochures are available for download directly off our website or in print in bulk orders by using the order form in the CFP Professionals section of FPSC’s website (see Marketing/Support/Brochures).
Focus on Financehelps youth
There is a growing interest among young people in getting their financial act together, and FPSC’s Focus on Finance booklet is a useful tool for teachers and CFP professionals when speaking to youth about money management. The information and activities in this resource are aimed at young people aged 15-25 and walks them through the steps of financial planning in a user-friendly way. Find it online in the Public hub of the FPSC website under the section “Resources/Educating Youth”. Know of an educator or institution that might be interested in using this resource? Call Heather Mills at 1.800.305.9886 or email hmills@fpsccanada.org.
Free Forum tickets
Need to stay abreast of some of the top issues, practices and tools in the financial planning industry? Hit the New Year running with free tickets to the Financial Forum and Wealth Management Expo coming to Toronto (January 24-26), to Calgary (February 1-2), Vancouver (February 8-9) and Montreal (February 15-16). Free tickets are available at www.financialforum. ca using the code: FPSC. FPSC’s booth will be at most locations. Drop by if you get a chance.
Recent articles posted on web
FPSC’s November’s feature article, “Leaving a Legacy Footprint”, shows the many ways to give and get through linked tax advantages. Read all about it on FPSC’s website in the Learning Centre in the public section. December’s article “T’is the Season” looks at how to teach children the values and habits of financial planning.
FPSC connects to build career awareness with students
FPSC’s new Student Associate program is all about making connections with the next generation of would-be CFP professionals and building longterm relationships with students in financial planning-related courses. With this program, FPSC hopes to develop an appreciation for the rewards of a career in financial planning and to guide students toward success in launching their careers by earning CFP certification.
FPSC’s Director, Professional and Student Affairs, Carolyn Fallis says, “The program provides insights into what a career in financial planning may look like, and a clear understanding of what’s involved to make it happen.”
The program costs $29 and is largely web-based.
On record
“If you are not talking to families about philanthropic activities, someone else will. It is one of the top reasons someone else will. It is one of the top reasons people are leaving and selecting new advisers.”
Patricia Lovett-Reid, CFP Senior VP, TD Waterhouse Toronto Star, November 1, 2007
“There’s been a tremendous merging of interests among allied professions. There’s been recognition that each individual Canadian has needs that cross over multiple professions. The logical, strategic direction for us is to ensure we’re in step with allied professions and making sure we’re working with them in matters of the public interest.”
Cary List President and CEO, FPSC Bottom Line, November issue
“Because of the rigour of the standards, because of the relevance of the standards, CFP professionals define the profession in Canada today.”
Ann Bowman FPSC VP Communications & Corporate Relations Toronto Star, October 15
“Becoming a CFP professional will say to others that I am willing to go the extra step to ensure I have the competence to serve my clients.”
Laura Strader-Murray, CFP Walker House Financial Group Walkerton Herald Times, November 2007
CFP®, CERTIFIED FINANCIAL PLANNER® and are certification marks owned outside the U.S. by Financial Planning Standards Board Ltd. (FPSB). Financial Planners Standards Council is the marks licensing authority for the CFP marks in Canada, through agreement with FPSB.
are certification marks