“We’re professional
I know, you know
We’re sophisticated”
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Getting through the door
I’m sure you know that new advisers who enter the profession from 1 January 2019 (or those who otherwise don’t meet the transitional rule requirements) will need to meet the new requirements of the Adviser Professional Standards laws, before being authorised to give personal financial product advice to retail clients. Existing providers had transitional [athways available to them.
In practice, the distinction matters because the obligations applying to new entrants differ from those applying to existing advisers who transitioned under earlier education standards. While many transitional arrangements have now passed, licensees still need to carefully verify adviser status, education eligibility, exam completion, and Financial Advisers Register accuracy before authorising advice activities.
Unfortunately, there’s a lot of confusion, anxiety, and uncertainty created around this seemingly clear requirement. Part of that may be caused by readily available misinformation, but, in my view, it’s largely the inevitable result of distributing relevant information amongst a variety of pages and documents including:
- Home | Financial Adviser Standards (treasury.gov.au)
- Better Advice Act
- Corporations (Relevant Providers—Education and Training Standards) Determination 2021
- Treasury Laws Amendment (2019 Measures No. 3) Act 2020
- ASIC Corporations (Professional Standards—Transitional) Instrument 2018/894
- Corporations (Work and Training Professional Year Standard) Determination 2018
We see our main role as providing clarity and simplifying compliance and regulatory requirements.
In that spirit, I’d like to suggest that new entrants to the financial advice industry now need to do the following things before they can provide personal advice to retail clients as a relevant provider.
What You Need to Do Before You Can Provide Personal Advice
A new entrant generally cannot provide personal advice to retail clients independently until they complete the Professional Year, pass the adviser exam, meet education standards, and are properly authorised and registered.
During the Professional Year, a provisional relevant provider may provide advice only under the supervision arrangements required by the framework. The supervision obligation sits with the licensee and supervising adviser, making documentation and oversight critically important.
1. Pass the Financial Adviser exam
From 1 January 2022, ASIC began administering the financial adviser exam (administered by the Australian Council for Educational Research (ACER)).
A new financial adviser (i.e. a person undergoing compliance training to become a financial adviser) must:
- Complete an approved degree before booking the exam.
- Pass the exam before starting the third quarter of their professional year.
2. Meet the Education Standards
New entrants are required to complete an approved qualification at a bachelor’s degree (AQF7 level), a graduate diploma (AQF8 level), a master’s level (AQF9) or an equivalent qualification before they can become a provisional financial adviser.
We recommend that you confirm the course is approved by checking the current legislative instrument.
If the degree or qualification was approved by FASEA prior to 31 December 2021 and is listed in the Corporations (Relevant Providers Degrees, Qualifications and Courses Standard) Determination 2021, Higher Education Providers can continue to refer to a course as a “FASEA approved degree” or “FASEA approved qualification”.
Although many education providers and industry participants still use the term “FASEA approved”, the professional standards framework is now administered under ASIC’s post-FASEA regime. The terminology persists historically, but the standards now operate through the broader Corporations Act professional standards framework.
3. Complete a Professional Year
A person training to become a financial adviser must do a professional year before they are fully qualified (professional year standard). This is also known as the year of work and compliance training.
A professional year is one year full-time, equivalent to 1,600 hours. At least 100 of these hours must be structured training and form part of their professional year plan.
A person can start this professional year while they are in the final stages of completing their approved degree.
Structured compliance training should be made up of education that is measurable, assessed, and leads to further qualification (formal and informal) outcomes for participants. This may include a formal study that is undertaken during the professional year, for instance, if completing the Ethics for Professional Advisers bridging course.
The professional year requirements are split into quarters so that a person can transition from a directly supervised approach to an indirectly supervised approach:
- Quarter 1 – Client Observations and support to Supervisor/Experienced Adviser
- Quarter 2 – Supervised Client Engagement and Advice Preparation
- Quarter 3 and 4 – Indirect Supervision of Client Engagement and Advice Preparation
At the end of each quarter, the supervisor must provide a certificate confirming the person:
(a) Has achieved the outcomes set out in the professional year plan for the quarter; and
(b) Is capable of satisfactorily completing the work activities and structured training for the next quarter.
Before commencing the third quarter of their professional year they must:
- Have completed an approved degree or equivalent qualification,
- Have passed the financial adviser exam, and
- Be authorised by their AFS Licensee as a ‘provisional relevant provider‘ on the Financial Advisers Register.
The Professional Year should not be viewed purely as a time-based training exercise. In practice, licensees should be able to demonstrate how competency was assessed, how supervision occurred, and how progression decisions were made if those processes are later scrutinised. Weak supervision records or inconsistent sign-off processes can create governance risk for the licensee, particularly where adviser competence is later questioned.
4. Comply with the Code of Ethics
During a New Entrant’s Professional Year, after they have completed an approved degree and passed the Exam, they may be referred to as a Provisional Financial Adviser or a Provisional Financial Planner and registered on ASIC’s Financial Adviser Register (FAR) on this basis.
From that time, the Code of Ethics will apply.
5. Satisfy CPD requirements (not in their PY)
Following the successful completion of the Professional Year and registration on the Financial Advisers Register, ongoing CPD obligations apply each year. For licensees, this is not simply an administrative requirement.
CPD records, competency monitoring, and training governance increasingly form part of broader supervision and compliance expectations.
6. Expected Outcomes
By the end of the Professional Year, the individual will need to:
Final Completion Certificate: A person is taken to have met the requirements of this determination if the supervisor and the responsible licensee give the person a final completion certificate in accordance with this determination.
Supervision frameworks need more than good intentions
Many Professional Year problems don’t begin with misconduct.
They begin with inconsistent supervision, weak documentation, unclear competency assessment, or governance processes that don’t scale as advisers are onboarded.
Assured Support helps licensees build practical, defensible, and operationally workable supervision and governance frameworks.
If you’re reviewing your Professional Year processes, adviser onboarding controls, or supervision framework, we can help you identify where governance risk actually sits.
Speak with Assured Support about Professional Year governance.
Professional Year Supervision Is Also a Governance Obligation
Many licensees focus heavily on whether the Professional Year requirements are technically completed. Increasingly, the more important question is whether the supervision framework itself is defensible.
That includes:
- documented supervision plans,
- evidence of file reviews,
- competency assessments,
- escalation processes,
- and clear records showing how the provisional adviser progressed through each quarter.
In practice, supervision failures often emerge later during complaints, remediation exercises, adviser misconduct investigations, or ASIC surveillance.
A Professional Year file that only demonstrates hours completed, without evidencing judgment, coaching, oversight, and competency development, may not withstand scrutiny particularly well.
For that reason, many licensees are now treating Professional Year governance as part of their broader risk and supervision framework rather than simply an HR or training process.
Governance becomes difficult when supervision lives in spreadsheets
Professional Year supervision creates a large amount of operational evidence:
file reviews, competency assessments, escalation records, supervision notes, training activity, and adviser progression tracking.
The challenge for many licensees isn’t understanding the obligation.
It’s maintaining consistency, visibility, and defensible records as the business grows.
[complye] helps licensees centralise supervision, governance, and compliance oversight so Professional Year obligations are easier to manage, evidence, and monitor in practice.
Many licensees already operate robust supervision and training frameworks. The challenge is ensuring those frameworks remain consistent, scalable, and well-evidenced as adviser onboarding pressures increase.
See how complye supports adviser supervision and governance
The Bigger Challenge Is Workforce Capacity
One of the less discussed consequences of the professional standards regime has been its impact on adviser supply and supervision capacity across the industry.
Many licensees now face competing pressures:
- attracting new entrants,
- maintaining supervision quality,
- evidencing competency,
- and managing the operational burden of onboarding provisional advisers properly.
In practice, this means the Professional Year is no longer just an education pathway.
It has become a governance, risk, operational, and workforce planning issue simultaneously.
Firms that approach the process strategically tend to integrate supervision, compliance, training, and operational oversight into a single framework rather than treating them as separate obligations.
Editorial note:
This article discusses the professional standards framework applying to relevant providers of personal advice to retail clients. Regulatory settings, education pathways, and transitional arrangements continue to evolve. Licensees should confirm current ASIC guidance, Treasury reforms, and Financial Advisers Register requirements before relying on historical transition commentary.
Final Observations
The Professional Year framework was designed to improve adviser competence, professionalism, and consumer confidence. But in practice, it has also reshaped how licensees approach supervision, recruitment, governance, and operational risk.
For new entrants, the pathway into advice is now far more structured and heavily supervised than it was historically. For licensees, that means onboarding an adviser is no longer simply a recruitment decision. It is a compliance, training, governance, and evidentiary exercise that requires ongoing oversight and documented competency assessment.
The firms that manage this well usually treat Professional Year supervision as part of their broader governance framework rather than a standalone training obligation. They integrate supervision, file reviews, competency assessment, escalation processes, and adviser development into a consistent operational model.
That matters because ASIC’s focus is rarely limited to whether obligations were technically completed. Increasingly, the regulator wants to understand how decisions were made, how competence was assessed, and whether supervision frameworks operate consistently in practice.
The Professional Year, therefore, remains important for reasons beyond education alone. It has become one of the clearest indicators of how seriously a licensee approaches governance, supervision, and adviser quality across the business.
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Frequently Asked Questions
A person who is in training to be a financial adviser and has also completed the below additional requirements:
– an approved degree or equivalent qualification,
– quarter one and quarter two of the professional year,
– passed the financial adviser exam, and
– are authorised by their Australian Financial Services Licensee as a ‘provisional relevant provider’ on the Financial Advisers Register.
The expressions “provisional financial planner” and “provisional financial adviser” are specified to refer to a provisional relevant provider.
Once they have completed an approved degree and passed the exam and before commencing their third quarter.
You can update the Financial Advisers Register using ASIC Connect.
Please refer to the ASIC Guide for step by step instructions
To obtain details about the 2022 Financial Adviser Exam Schedule, book to sit an exam, refer to ASIC’s Financial Advisers Hub.
Email help@assuredsupport.com.au or refer to current legislative instrument.
Much of the earlier industry focus centred on transitional education requirements for existing advisers. While many of those deadlines have now passed, education eligibility and adviser status remain active compliance issues for licensees, particularly where advisers move between licensees, rely on historical qualifications, or seek recognition under updated pathway reforms.
Treasury reforms and ongoing policy discussion have introduced additional flexibility into some education pathways, but they have not removed the obligation for licensees to verify that advisers meet the applicable professional standards before authorisation.
