Under the Financial Services Reform Act, all existing Investment Adviser’s and Securities Dealer’s licenses under the Corporations Act will cease to be effective as of March 11, next year. This means that all existing licensees will either need to apply for a new Australian Financial Services License or work as authorised representatives of the holder of an Australian Financial Services License (AFSL).

We, Direct Advisers Pty Limited were granted our new Australian Financial Services License in early October and it becomes effective on January 10, next year. As far as we can ascertain, this will make us the only independently owned financial planning firm operating under its own license on the Mid North Coast. Which means that we are directly responsible to and will be audited by the Australian Securities and Investments Commission. This requires us to maintain the highest standards in regard to the quality of the advice that we provide.

Our new license allows us to provide the same investment products and services that we provided to you under our previous Unrestricted Dealers License and in addition, we are also licensed to act as life insurance brokers. This means that we are licensed to deal in and to apply for, acquire, vary or dispose of financial products on behalf of another.

The relevant products are as follows:

In addition we also provide mortgage broking and financial coaching services, which at this stage are not regarded as financial services requiring an Australian Financial Services License.

As a result of the new licensing regime, you will notice some changes in the way we give advice and the format in which our advice is given.

At your next review or prior to then if we provide you with advice, we will be issuing you with two new documents:

These will set out the scope of our relationship with you, the products and services that we offer and how we are remunerated for providing products and services to you. Please note that these documents will not replace your existing agreements with us nor alter the fees that we charge you.

You would be aware that in the past we have provided all significant advice (such as portfolio rebalancing following a review) to you in writing. The requirement for the provision of written advice has been extended under the Financial Services Reform Act. Under the new AFSL regime, any time that advice is given in regard to a financial product or class of financial product a Statement of Advice must be given to the client. This has been strictly interpreted as meaning that if for example you call us with a general question such as to enquire how your investments are going or for some clarification regarding an investment in your portfolio, we may be required to send you a formal Statement of Advice document.