FPSC LAUNCHES NEW RESOURCE TO ASSIST CFP PROFESSIONALS WRITE ENGAGEMENT LETTERS THAT COMPLY WITH PRACTICE STANDARDS
Toronto, May 24, 2005 - Financial Planners Standards Council (FPSC) today launched a new resource (FPSC Resource for Practice Standard 100) to help CFP professionals develop engagement letters that comply with Practice Standard 100* of the new CFP Financial Planning Practice Standards finalized this spring. Practice Standard 100 requires written disclosure be made at the outset of a financial planning engagement to establish and/or confirm the terms of the engagement. The new resource is available online at FPSC's website at www.cfp-ca.org.
"Providing written disclosure is fundamental to ensuring both the professional and client have a mutual understanding of the scope and respective responsibilities of the engagement," says Carolyn Fallis, Director, Professional & Student Affairs, FPSC.
"While an engagement letter is generally considered the best way to meet that requirement, FPSC acknowledges that one size does not fit all. Relationships and engagements with clients differ and are unique As such we designed this resource as a guide - not a definitive template - that CFP professionals can work with to craft engagement letters that comply with the standards and also allow for flexibility and customization to meet their unique client circumstances," adds Fallis.
FPSC Resource for Practice Standard 100: The guide offers a variety of suggested disclosure boilerplate wordings and phrases that can be incorporated into an engagement letter. As well, the resource outlines seven distinct scenarios as examples, with sample template letters and options that can be further customized. The scenarios address both financial planning engagements and those that are not considered financial planning but may be construed as such by a client and would require appropriate disclosure from a CFP professional.
Practice Standards: The final version of the Practice Standards is posted on FPSC's website and is relevant and applicable to all CFP professionals in Canada in their practice of financial planning. FPSC has incorporated the much valued and considered input received since the draft Practice Standards were introduced to the Canadian CFP community and financial planning industry in October 2003.
As has always been their purpose, the Practice Standards will clarify the respective roles and responsibilities of CFP professionals and their clients.
Financial Planners Standards Council (FPSC) is a not-for-profit organization established in 1995 to foster professionalism in personal financial planning. FPSC develops and enforces the highest standards in financial planning competency and ethics for individuals who hold the CFP® (CERTIFIED FINANCIAL PLANNER®) in Canada. There are currently about 16,000 CFP professionals in Canada and more than 90,000 individuals who have earned the CFP designation in 18 countries around the world. See www.cfp-ca.org for more information.
*NOTE TO EDITORS: The wording for Practice Standard 100 is as follows:
Establish the Engagement: Define the Terms of the Engagement
The client and the CFP Professional should define and agree on the scope of the Financial Planning Engagement ("Engagement"). Details about each party's responsibilities, the time frames of the engagement, compensation, and Conflicts of Interest should be set out in writing in a formal Engagement Letter or in a Letter of Understanding, signed by both parties.
The Practice Standards can be downloaded from the FPSC website.
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Media Contacts:
Eileen Chadnick/Chadnick Communications at 416.631.7437 or eileen@chadnick.com
or
Reed Hilton at 416.593.8587 ext. 235 or rhilton@cfp-ca.org
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