ASIC has released an updated Regulatory Guide 245 Fee disclosure statements (RG 245) to reflect regulatory and legislative changes since the guide was first published, including revisions to the Future of Financial Advice (FOFA) reforms.
The fee disclosure statement (FDS) obligations require advice providers who have an ongoing fee arrangement with a retail client to provide the client with an annual FDS setting out information about:
- the fees paid by the client;
- the services provided to the client; and
- the services that the client was entitled to receive.
This obligation is designed to help clients determine whether the ongoing fees they are paying are proportionate to the services they have received, or were entitled to receive.
As well as some minor changes to remove outdated references, RG 245 has been updated to:
- reflect technical amendments to the FOFA legislation since the previous version of RG 245 was released; and
- clarify that the three limited no-action positions that were previously taken by ASIC in respect of the obligations to prepare and give an FDS, are no longer available. These no-action positions were taken to assist the industry to make a smooth transition to meeting the FDS obligations, which have now been in force for some time.
Background
RG 245 is for persons who provide personal advice to retail clients and their professional advisers (such as lawyers).
RG 245 provides guidance on how ASIC will administer the requirement under the Corporations Act for financial advisers who provide personal advice to retail clients under an ongoing fee arrangement to prepare and give a fee disclosure statement.