ASIC expects AFS licensees to distinguish between periodic review obligations and ongoing service delivery, ensuring annual reviews reassess client circumstances and advice suitability, while ongoing service involves continuous monitoring, engagement, and delivery of agreed services. Both must be clearly defined, delivered as promised, and evidenced.
Expanded Answer
ASIC expects that where an ongoing service arrangement exists, the services promised to the client must be delivered and documented. An annual review is typically a structured reassessment of the client’s circumstances, objectives, and the continued appropriateness of the advice. This includes updating fact finds, reviewing portfolio performance, reassessing risk tolerance, and confirming that the strategy remains suitable.
Ongoing service, by contrast, includes the continuous activities delivered throughout the year, such as portfolio monitoring, rebalancing (if agreed), client communications, and responding to client queries or changes in circumstances. These services must align with what was disclosed and agreed with the client, including fee arrangements and service entitlements.
In practice, AFS licensees should clearly define what constitutes an annual review versus ongoing service in client agreements and internal procedures. Each interaction must be documented, with evidence that services were delivered as promised. Regulatory scrutiny increases where services are charged but not provided, or where annual reviews are treated as a formality without meaningful reassessment. ASIC has emphasised service delivery failures as a key enforcement area, as outlined in client consent: a compliance cornerstone and trust-building tool and building resilient advice practices: compliance and client retention strategies.
Why it matters
Failure to deliver and evidence ongoing services, including annual reviews, exposes AFS licensees to breach reporting, remediation, and enforcement action. ASIC focuses on whether clients receive value for fees and whether advice remains appropriate over time.
Practical guidance
- Define and document the scope of annual reviews versus ongoing services in client agreements and internal policies
- Evidence of each service delivered, including review outcomes, client interactions, and any advice updates
- Monitor service delivery against fee arrangements to ensure clients receive what they have paid for
Further reading
Client consent: a compliance cornerstone and trust-building tool
Building resilient advice practices: compliance and client retention strategies