Assignment (Pre-Answers) PDF

Assignment
Financial Planning (DFP1B_AS_v1A3)

Student identification (student to complete)
Please complete the fields shaded grey.
Student number
Assignment result (assessor to complete)

Result first submission (Details for each activity are shown in the table below)
Parts that must be resubmitted:
Result resubmission (if applicable)
Case study assignment

questions
Result summary (assessor to complete)

First submission
Resubmission (if required)
Section 1
Not yet demonstrated
Section 3
Section 4
Section 6
Section 7
Statement of Advice
Cash flow tables
Fiveyear projections
Feedback (assessor to complete)

[insert assessor feedback]
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Before you begin

Read everything in this document before you start your assignment for Financial Planning
(DFP1B_AS_v1A3).
About this document

This document includes the following parts:
Part 1: Instructions for completing and submitting this assignment
Part 2: The case study
Appendix 1: Fact finder and risk profile
Appendix 2: Financial planning questions (assessment workbook):
Case study questions
Statement of advice (SOA) template
Cash flow tables (financial position after implementation of strategy)
Five-year projection table
Appendix 3: Assumptions.
How to use the study plan

We recommend that you use the study plan for this subject to help you manage your time to complete
the assignment within your enrolment period. Your study plan is in the KapLearn Financial Planning
(DFP1B_AS_v1A3) subject room.
How to use the sample case study and SOA in KapLearn

The sample case study provides a model to help you prepare your SOA for this assignment. The case study
explains the process that is undertaken to develop the SOA with reference to an example and it is a very
useful resource. Download the sample SOA and refer to it as you work through the learning materials for
this subject.
Before you start work on this assignment, go back to the sample SOA and:
compare how the SOA matches with the goals and objectives identified in the case study
consider what information has been included in the SOA
consider why this information has been included.
This exercise will help your prepare an SOA for this assignment that addresses your clients goals.
Please bear in mind that not all SOAs are exactly alike in their construction, but all have common
heading topics within them. Accordingly, there may be minor differences between the sample SOA and
the SOA template in this assignment. However, all the required compliance elements will be included in
both formats.
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Part 1: Instructions for completing and submitting

this assignment
Completing the assignment
For this assignment you are required to complete the following tasks:
In your assessment workbook:
answer the assignment questions as they relate to sections 1, 3, 4, 6 and 7 of the case study
complete the template SOA for your client, using the data in the case study, the fact finder and
risk profile
complete the two (2) cash flow tables
calculate the five year projection.
The information and resources that can assist you in answering the questions in this assignment can be
primarily sourced from the Foundations of Financial Planning text and the sample case study. Some data
will have to be externally sourced, but the assignment template will clearly indicate where this is necessary.
You are expected to analyse the 11 areas covered in the data analysis stage, explained in Topic 2, as well as
review the sample case study and sample SOA. Additionally, you will need to weigh up the clients opinion
against your own analysis to determine the important areas that need to be addressed for the client.
Although the case study may indicate that the client does not wish to have advice provided about a specific
area, you need still to evaluate the situation, provide clear reasons as to why, or why not, review the area,
and make referrals to specialists if necessary in the relevant sections of the template.
You do not have to provide retirement planning calculations and recommendations.
However, you must consider the appropriateness of all the investments held by Sharon. If you recommend
any change to her current asset allocation (including those in her superannuation fund), you must explain
why this action is appropriate. That is, why there is a need to change the asset allocation, or to replace or
sell an investment.
With regard to insurance, you are not expected to provide a detailed analysis of Sharons needs. However,
this area still needs to be examined. If your analysis shows that she requires additional insurance and could
benefit from a review, you should advise her of this. Alternatively, clearly explain why you believe her
current cover is sufficient.
More information regarding requirements for providing advice is included throughout the assignment.
Word count
The word count shown with each question is indicative only. You will not be penalised for exceeding the
suggested word count. Please do not include additional information which is outside the scope of the
question.
The Sharon Elsom case study

The case study steps you through the financial planning process, from initial contact with Sharon Elsom,
to the development and documentation of a financial strategy as an SOA to meet her needs.
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Fact finder and risk profile

The fact finder for Sharon and her risk profile are provided. You will find these in Appendix 1. The data in
these documents has been used to complete some of the sections in the SOA. You will need to refer to
these documents to complete the financial position tables for your client.
Additional research
When completing this assignment, assumptions are permitted although they must not be in conflict with
the information provided in the Case Studies.
You may also be required to source additional information from other organisations in the finance industry
to find the right products or services to meet your clients requirements, or to calculate any service fees
that may be applicable.
Saving your work

Download this document to your desktop, type your answers in the spaces provided and save your
work regularly.
Use the template provided, as other formats will not be accepted for these assignments.
Name your file as follows: Studentnumber_SubjectCode_Submissionnumber
(e.g. 12345678_DFP1B_Submission1).
Include your student ID on the first page of the assignment.
Before you submit your work, please do a spell check and proofread your work to ensure that everything is
clear and unambiguous.
Page 5 of 63
Submitting the assignment

You must submit your completed assignment in a compatible Microsoft Word document. You need to save
and submit this entire document.
Do not remove any sections of the document.
Do not save your completed assignment as a PDF.
The assignment must be completed before submitting it to Kaplan Professional Education.
Incomplete assignments will be returned to you unmarked.
The maximum file size is 5MB. Once you submit your assignment for marking you will be unable to make
any further changes to it.
You are able to submit your assignment earlier than the deadline if you are confident you have completed
all parts and have prepared a quality submission.
The assignment marking process

You have 12 weeks from the date of your enrolment in this subject to submit your completed assignment.
Should your assignment be deemed not yet competent you will be give an additional four (4) weeks to
resubmit your assignment.
Your assessor will mark your assignment and return it to you in the Financial Planning (DFP1B_AS_v1A3)
subject room in KapLearn under the Assessment tab.
Make a reasonable attempt

You must demonstrate that you have made a reasonable attempt to answer all of the questions in
your assignment. Failure to do so will mean that your assignment will not be accepted for marking;
therefore you will not receive the benefit of feedback on your submission.
If you do not meet these requirements, you will be notified. You will then have until your submission
deadline to submit your completed assignment.
How your assignment is graded

Assignment tasks are used to determine your competence in demonstrating the required knowledge
and/or skills for each subject. As a result, you will be graded as either competent or not yet competent.
Your assessor will follow the below process when marking your assignment:
Assess your responses to each question, and sub-parts if applicable, and then determine whether you
have demonstrated competence in each question.
Determine if, on a holistic basis, your responses to the questions have demonstrated overall
competence.
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Not yet competent and resubmissions

Should sections of your assignment be marked as not yet competent you will be given an additional
opportunity to amend your responses so that you can demonstrate your competency to the required level.
You must address the assessors feedback in your amended responses. You only need amend those sections
where the assessor has determined you are not yet competent.
Make changes to your original submission. Use a different text colour for your resubmission. Your assessor
will be in a better position to gauge the quality and nature of your changes. Ensure you leave your first
assessors comments in your assignment, so your second assessor can see the instructions that were
originally provided for you. Do not change any comments made by a Kaplan assessor.
Units of competency
This assignment is your opportunity to demonstrate your competency against these units:
FNSASICZ503
Provide advice in financial planning
FNSFPL501
Comply with financial planning practice ethical and operational guidelines and regulations
FNSFPL502
Conduct financial planning analysis and research
FNSFPL503
Develop and prepare financial plan
FNSFPL504
Implement financial plan
FNSFPL505
Review financial plans and provide ongoing service
FNSFPL506
Determine client financial requirements and expectations
FNSINC401
Apply principles of professional practice to work in the financial services industry
BSBITU402
Develop and use complex spreadsheets
FNSASIC301
Establish client relationship and analyse needs
FNSASIC302
Develop, present and negotiate client solutions
FNSIAD301
Provide general advice on financial products and services
We are here to help

If you have any questions about this assignment you can post your query at the Ask your Tutor forum in
your subject room. You can expect an answer within 24 hours of your posting from one of our technical
advisers or student support staff.
Page 7 of 63
Part 2: The case study

Introduction
You are a financial planner for NANCA Financial Planning and authorised to provide financial product advice
on a range of investments (excluding direct shares), superannuation and retirement planning,
and insurance and risk protection.
You are also able to provide taxation information that is incidental to the advice provided. In other words,
you can provide information about any potential tax savings or tax benefits that could result from your
recommendations, but you must refer the client to a tax professional for specific tax advice.
You do not have the authority to provide estate planning or property advice and you must refer clients to
suitable professionals should you identify they need advice in areas for which you have not been
appropriately authorised and trained. (Refer to the sample SOA and the wording used regarding tax,
estate planning and real estate, as well as the summary of what advice areas are covered, and what are
not, at the beginning of the sample SOA.)
Section 1: Meeting your client

The first phone call
Sharon Elsom has agreed to speak with you following a suggestion made to her by her banks personal
lending officer who knows you and is respectful of the quality advice you provide to your clients. She was in
the process of successfully organising a loan to purchase her car at the time.
Sharon is unsure of what is involved in personal financial planning, but concedes that planning for her
future financial objectives could be of value. She agrees to have her contact details passed on to you by
the banks lending officer so that you can tell her about what is involved in the financial planning process,
what the possible benefits might be to her, and costs involved.
When you phone Sharon, you provide her with details about the financial planning process, and why
you will need to ask her for certain types of financial information. You stress that you work for a licensee
(a person authorised by the Government to deal in financial products) any information she gives you will be
treated confidentially. You let her know that this information will only be used to provide the financial
advice you consider will meet her needs. You tell her all this information is in the Financial Services Guide
(FSG) that you will send her.
Sharon is reassured by your introduction so you proceed. You explain you need her to contribute to the
compilation of a financial profile in order to help you work out how she can best meet her financial goals.
This means that she will need to tell you what she owns, what she owes, what she earns and her living
expenses. She can record all this information in the fact finder you will send her with the FSG. You inform
Sharon that the fact finder also includes a risk profile section and the information she provides you will give
you sense of her appetite for different financial planning strategies.
You make a date and time with Sharon to come to your office and take down her address and phone
numbers. You ask Sharon to bring along to the meeting her completed fact finder and as much financial
information as she can, such as income details, expenses, superannuation, insurance details, etc.
When you have concluded the call, you make a file note about the conversation including the date, the potential
clients name, and the name of the person who referred her to you. This is the start of your paper trail. You also
complete some of the initial details in your data collection form so that it looks like Table 1.
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Finally you write to Sharon, as promised during your initial conversation, and include the fact finder,
the FSG and a checklist of the information she needs to bring to the meeting.
Table 1
Personal details
Client 1
Client 2
Title
Miss
Surname
Elsom
Given & preferred names
Sharon
Home address
16/118 Gloucester St, Brunswick East, Vic.
Business address
n.a.
Contact phone
(03) 7766 5544
Date of birth
15 September 1986
Sex
Male
Female
Male
Female
Smoker
Yes
No
Yes
No
Expected retirement age
Havent really thought about it, but probably 62
The first meeting

Sharon arrives at your office for the meeting. After greeting her and offering her a glass of chilled water,
she confirms that she received your package of documents and that she has filled in the fact finder and the
risk profile.
You then take her through the key elements of the FSG, including your role and capacity to assist her with
her planning needs and your companys fees. You make sure that Sharon understands this information
before you proceed to the next step.
Collecting the data

You learn the following information about Sharon through a process of thorough and polite questioning.
From time to time she provides you with a relevant document to confirm her financial situation.
You confirm the details in the fact finder as you proceed.
Sharons current situation

Sharon, born 15 September 1986, is single with no dependants, and lives in a rented flat for which she pays
rent of $490 per week.
Sharon is a sales manager for a small solar panel manufacturing company and has been with that firm for
three years.
Sharon earns $82,000 p.a. and receives superannuation guarantee (SG) contributions from her employer in
addition to this.
Sharon owns a new Mazda CX5 that she recently borrowed $37,000 from her bank to purchase.
The loan is over five years at a fixed rate of 8.9% p.a. with the repayments being $770 per month. There is a
prepayment fee of $175, though this fee is waived if the loan is refinanced to another product with the
same bank. The car has full comprehensive insurance with an annual premium of $1300.
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Sharons needs and objectives

During your conversation with Sharon it becomes apparent that her principal financial objective is to
purchase her first home and to receive advice from you as to the appropriate investment strategy to
achieve this. At this stage she is unsure of the location where she would like to buy but it would most likely
be a unit or townhouse.
On her own calculations, based on what she feels comfortable in borrowing and with her savings, she could
afford a unit up to a purchase price of $620,000. She also said that she would like to have saved at least
15% of the purchase price and, if possible, be able to purchase her home in no more than 5 years time.
She is also concerned about the debt she has incurred buying her car and would like to know the benefits
and ramifications of paying it off early, particularly in terms of her primary objective of saving for,
and purchasing, her first home.
Sharon admits that she knows very little about the sharemarket, how it works, or what it actually means to
own shares. However, she is keen to learn more about it following her success with the purchase of
Westpac Banking Corporation shares.
Sharon is in good health and believes the insurances within her superannuation fund provide
adequate cover.
She does not place superannuation and retirement planning as a priority at the moment, saying that
retirement is a long way off and her employer looks after her superannuation anyway.
Sharon does not have a will or powers of attorney in place, and appears to you to be not overly concerned
about the adequacy of her estate planning.
Superannuation
Sharon has $32,000 in her employers default superannuation fund, the ABXY Industry Super Fund, and is
invested in the balanced portfolio option. Sharon joined the fund on 19 January 2008.
Sharon does not make any additional contributions to her superannuation fund.
The fund has returned the following, after fees and tax:
2009/10
2010/11
20011/12
2012/13
2013/14
2014/15
8.9%
10.2%
2.1%
11.3%
9.8%
7.0%
The investment objective of the fund is to achieve returns after tax and fees that exceed the inflation rate
by 4%, as measured by the CPI, over rolling five-year periods.
The asset allocation for Sharons balanced superannuation fund is:
Cash
7%
Australian fixed interest
12%
International fixed interest
10%
Australian equities
30%
Property
18%
International equities
23%
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Insurance
Sharons superannuation fund provides a death and total and permanent disability (TPD) benefit of $50,000
in addition to her accumulated superannuation value. The premium is $1.50 per week for this level of cover
and is deducted from her fund.
Sharon has no other personal insurance cover.
Sharons car has full comprehensive insurance with an annual premium of $1300.
Sharon also has home contents insurance cover of $20,000 with an excess of $100 including legal liability
cover of up to $20 million. Sharon pays $28 per month from her credit card for this policy.
Sharon has adequate private health insurance cover that she pays $120 per month for on her credit card.
This premium includes the private health insurance rebate.
Sharon has advised you that she is comfortable with the insurances she has in place and does not believe
that she requires any further advice at this time.
Investments
Sharon has $45,000 in a soon to mature, one year, term deposit earning 3.25% p.a. She plans to use
these funds and future savings towards the purchase of her own home in about 5 years time, or earlier
if possible.
Following advice from her uncle at a family barbecue, Sharon purchased 70 Westpac Banking Corporation
shares on 25 November 2008 at $16.93. The full dividend received for the most recent year was
$1.86 per share fully franked. Dividends received are not reinvested.
Sharon also has a small transaction account where her pay is deposited. This account is used to pay
various expenses and her credit card. The account, on average, would have $1500 and it does not receive
any interest.
Other information
Sharon has a credit card with a limit of $8,000 that she uses for all her general expenses and
entertainment. However, she does not spend up to her limit and her average expenses are
$950 per month, (including home contents and health insurance), which she repays within the interest
free period.
Each year Sharon goes on a two-week cruise with a friend, which costs $2500.
In addition, she usually spends two weeks with her family during her employers Christmas leave period.
Sharon is very healthy and has taken very little sick leave and has accumulated 27 days sick leave.
Other expenses include a donation to the McGrath Foundation of $50 per month, tax deductible bucket
donations of $10 per month to various registered charities, and accountants expenses of $175 p.a.
Sharon does not have any dependants and both her parents are well, fit and active. She has an older
brother who is married with two young children and a younger sister who still lives with her parents.
Risk profiling
With your assistance, Sharon completed the risk profile section in the fact finder prior to attending the
meeting. Following discussions with Sharon she confirmed that she was closest to the balanced investor
profile. The completed fact finder and risk profile are in Appendix 1 of the assignment.
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Closing the interview

Prior to concluding your meeting with Sharon, you review the information provided to her to check that it is
complete and accurate.
Sharon is naturally curious about the next step in the process. You answer some additional questions she
has about what happens next. You explain that with her agreement you will prepare a written report,
an SOA, based on the information she has just shared with you. The SOA will be a financial plan detailing
a number of actions she could take to meet her financial goals.
Sharon agrees to proceed to the next stage of the financial planning process, and you make an
appointment with her to present the plan in a fortnight.
Note: There is a series of questions relating to Section 1 in the assessment workbook that you need to
answer. Your answers to these questions are your opportunity to demonstrate your ability to establish a
relationship with a client.
Section 2: The fact finder and risk profile

After this meeting and when you are in professional practice you would normally take the time now to
complete a fact finder.
However, this template has already been prepared for you based on the information given by Sharon.
You will find that fact finder and risk profile in Appendix 1.
Take some time now to familiarise yourself with Sharons fact finder and risk profile to confirm that all
the information recorded is correct. You will need to refer to this data when you are completing the SOA,
the cash flow tables and the five-year projections.
Section 3: Analysing the data

The next step in the financial planning process is to analyse the data provided by Sharon. You do this to
ensure that you can fully understand her financial situation and needs and are therefore in a position to
design a plan that addresses her goals and objectives.
By analysing the data provided under the following headings you can now start thinking of the strategic
options that may be appropriate for Sharon, leading you to then preparing a financial planning strategy that
is designed to meet her needs:
current position
debt management
risk/protection
savings
investment
retirement funding
future income stream
social security issues (if any) and implications
present and future taxation issues
estate planning.
answer. You will use your answers for Section 3 to help you decide on your recommendations for Sharon.
Your answers to these questions are your opportunity to demonstrate your ability to analyse a clients
needs in preparation for developing a strategy that aligns with their requirements.
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Section 4: The strategy

Now that you have analysed the data and selected strategies that could be appropriate, you are in a
position to start drafting the preferred strategy you believe is appropriate for Sharon. You will then be able
to research and select possible products that can support the implementation of that strategy. All of this
information you will use in your SOA for her.
answer. You will use your answers for Section 4 to help you decide on your recommendations for Sharon.
Your answers to these questions are your opportunity to demonstrate your ability to develop a strategy
that aligns with her requirements.
Strategy tips
Students should note that there may be more than one strategy or group of strategies that could be
appropriate in Sharons circumstances. In fact it would be unusual in developing strategies for any clients
where one specific strategy or set of strategies could be classified as the best or perfect.
The ultimate test is that the strategies selected can be justified and explained in terms of the clients stated
goals, financial situation and profile.
In Sharons case, there are certain variables to consider, such as:
1. In dollar terms, what appropriate house deposit is she aiming to accumulate and over what time period?
2. What would be the ramifications if the car loan was paid off using her maturing term deposit savings?
In this case, how should she invest her remaining capital and future savings to reach her house deposit
goal over a maximum five-year period?
3. What would be the ramifications if the car loan was not paid off (or only paid off in part)? In this case,
what could be an appropriate investment strategy for Sharons maturing term deposit and future savings
to reach her house deposit goal?
4. How does her risk profile fit into the time horizon she has selected to purchase her first home and for
point 2 and 3 above?
5. Could a valid strategy potentially have Sharon in a position to purchase her first home within five years?
How much risk would she need to accept to achieve her declared savings goal?
A number of strategy options may appear available to Sharon to achieve her primary goal.
Whatever strategy you select however, must be seen to be appropriate, including being within Sharons
tolerance to risk, and satisfy minimum requirements under the best interests test.
It is important that you discuss the reason, risks, advantages and disadvantages of each recommendation.
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Section 5: Completing the SOA

When you have determined the financial planning recommendations you believe are appropriate for
Sharons needs, you then need to prepare her SOA. Use the SOA template provided in the
assessment workbook.
Section 6: Presenting the SOA

You meet with Sharon as arranged to present her SOA. You take the time to outline the proposed strategies
and recommendations, confirming throughout that Sharon understands the plan and how it has been
designed to meet her needs.
Satisfied with your explanation of the plan and responses to each of her questions, Sharon agrees to go
ahead with your recommendations.
answer. Your answers to these questions are your opportunity to demonstrate your ability to continue to
engage your client.
Section 7: Providing ongoing service

Sharon is not sure she will have time for regular reviews of her financial plan. She expresses the opinion
that the advice seems comprehensive with no need at this stage to commit to scheduled reviews.
There is a series of questions relating to Section 7 in the assessment workbook that you need to answer.
The questions are your opportunity to demonstrate your ability to work with a client to implement a plan
over the longer term.
Page 14 of 63
Appendix 1: Fact finder and risk profile Sharon Elsom

Important notice to customers
Your planner must act in your best interest and provide appropriate advice when making an investment or
insurance recommendation.
Before making a recommendation, the planner needs to ask you about your investment objectives,
financial situation and your particular needs.
The information requested in this form will be used strictly for that purpose.
Warning
The planner could make inappropriate recommendations or give inappropriate advice if you fail to fully and
accurately complete this form.
Personal and employment details

Personal details
Client 1
Client 2
Title
Miss
Surname
Elsom
Given & preferred names
Sharon
Home address
16/118 Gloucester St, Brunswick East, Vic
Business address
n.a.
Contact phone
(03) 7766 5544
Date of birth
15 September 1986
Sex
Male
Female
Male
Female
Smoker
Yes
No
Yes
No
Expected retirement age
Havent really thought about it, but probably 62
Dependants (children or other)

Name
Date of birth
Sex
School
n.a.
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Occupation
Employment details
Sharon Elsom
Occupation
Employment status
Business status
Sales Manager
Self-employed
Employee
Self-employed
Employee
Not employed
Pensioner
Not employed
Pensioner
Permanent
Part-time
Permanent
Part-time
Casual
Contractor
Casual
Contractor
Other
Government
Other
Government
Sole proprietor
Partnership
Sole proprietor
Partnership
Private company
Trust
Private company
Trust
Notes
Any other person to be contacted? e.g. accountant, banker, solicitor, etc.
Page 16 of 63
Income, tax and cash flow

Tax calculation
Sharon
Client 2
Combined
Comments
Income from employment (figures rounded to the nearest dollar)

Salary
Salary sacrifice
Salary after salary sacrifice
$82,000
nil
$82,000
Rental income
n.a.
Unfranked dividends
n.a.
Franked dividends
Franking (imputation) credits
Interest
$130
$56
$1,463
Other income (e.g. taxable benefits, trust income,

investment income)
n.a.
Capital gains < 1 yr
n.a.
Capital gains > 1 yr
n.a.
Tax-free component of capital gains
n.a.
Assessable income
Westpac Banking
Corporation dividends
$45,000 @ 3.25%
$83,649
Deductible expenses
$175
Accountants fees
Donations
$720
$600 McGrath Foundation

$120 bucket donation
Other
nil
Taxable income
$82,754
Tax on taxable income
$18,566
Non-refundable tax offsets (e.g. LITO/SAPTO)

Medicare levy
n.a.
$1,655
Medicare levy surcharge
n.a.
Less franking rebate
$56
Less refundable rebates and offsets
n.a.
Total tax
$20,165
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FY 2014/15
Cash flow
Sharon
Client 2
Combined
Comment
Cash flow
Salary less any salary sacrificed amount
Non-taxable income
$82,000
nil
Rental income
n.a.
Unfranked dividends received
n.a.
Franked dividends received

Interest
Other income (e.g. taxable benefits, trust income,
investment income, social security benefits, etc.)
Total income received before tax
Investment expenses
$130
$1,463
nil
$83,593
nil
Expenses
Mortgage
n.a.
School fees
n.a.
Utilities
n.a.
Personal insurance
Car insurance
nil
$1,300
Paid from credit card
$336

Includes legal liability
Health insurance
$1,440
Living expenses
$9,624
Expenses through credit card
Holidays
$2,500
Home contents Insurance
House maintenance
Motor vehicle
Other
n.a.
Unknown
$25,480
$9,240
Paid as part of the expenses

through credit card
Rent
Car repayments
$720
Donations
$175
Accountants fees
Total expenses
$50,815
Total income received before tax less total expenses
$32,778
Total tax payable from tax table above
$20,165
Total net cash flow
$12,613
Page 18 of 63
Assets and liabilities

Asset
Owner
Value
Liabilities
Net value
Notes
Insured value and includes

legal liability cover
Personal assets
Family home
n.a.
n.a.
Home contents
Sharon
$20,000
$0
$20,000
Car
Sharon
$37,000
$37,000
$0
$57,000
$37,000
$20,000
$32,000
n.a.
$32,000
Total
Superannuation
Employer superannuation
Sharon
Total
$32,000
$32,000
Other assets
Investment property
n.a.
n.a.
n.a.
Savings account
Sharon
$1,500
nil
$1,500
Term deposit
Sharon
$45,000
nil
$45,000
Shares
Sharon
$2,100
nil
$2,100
$48,600
nil
$48,600
$137,600
$37,000
$100,600
Total
Net worth
Transaction account
Westpac Banking Corporation

assumed current price $30.00
Liabilities
Loan
Current debt
Percentage tax
deductible
Home loan
n.a.
n.a.
Investment property
n.a.
n.a.
Investment loan
n.a.
n.a.
$37,000
nil
Other
n.a.
n.a.
Total
$37,000
$0
Personal loan
Page 19 of 63
Interest only
Repayment
No
$770 per month
Needs and objectives

Details
Comments
Save for her own home
Has been saving towards it using on line savings accounts and

term deposits. Has estimated that she could afford purchase
price of up to $620,000 using mortgage and savings. Would like
to have saved at least 15% of the purchase price and be in a
position to buy in no later than 5 years time
Decrease debt
Concerned about debt interested in paying off early but

requires guidance on the effect (if any) to her primary desire to
purchase her first home
Cruise with friend
$2500 annually
Increase sharemarket knowledge
Current knowledge is low
Maintain lifestyle in the event of prolonged illness
To be reviewed
Other
Estate planning
Do you have a will?
Yes
When was it last updated?
No
/
Do you have powers of attorney?
Yes
/
No
Current superannuation, rollovers, insurances and investments

Superannuation
Member
Sharon
Fund name
ABXY Super Fund
Date of joining fund
19 January 2007
Type of fund
Contributions
(e.g. 5% of salary)
SG
Accumulation
Defined benefit
Accumulation
Defined benefit
Pension
Pensioner
Pension
Pensioner
By employer
By yourself
By employer
By yourself
Current value of your

superannuation fund
$32,000
Amount of death and

disability cover
$50,000
Is there provision for you to

top up or salary sacrifice?
Yes
No
Page 20 of 63
Yes
No
Superannuation taxation details

Sharon
Current value
$32,000
Tax-free component
$0
Taxable component:
Taxed element
$32,000
Untaxed element
$0
Preservation:
Preserved
$32,000
Unrestricted non-preserved
$0
Restricted non-preserved
$0
Contributions:
Non-concessional contributions:
Year 1
$0
Year 2
$0
Year 3
$0
Year 4
$0
Concessional contributions:
Year 1
SG only
Year 2
SG only
Year 3
SG only
Year 4
SG only
Page 21 of 63
Nominated beneficiaries:
Name
Binding
Yes/No
Non-binding
(Yes/No)
Amount
Trustee discretion
(Yes/No)
None noted
Yes
Is there any current flags or splits on a superannuation benefit

of yours following a marriage breakdown?
Yes/No
Details
Are you a beneficiary of any current flags or splits of a

superannuation benefit following a marriage breakdown?
Yes/No
Details
Life insurance details

Life insured
Owner
Policy type
Company
Policy
number
Death
benefit
Comments
Annual
premium
Sharon
Superannuation
fund
Life
ABXY Super
Fund
XTP1234
$50,000
Within
superannuation
From
superannuation
Disability insurance details

Life insured
Owner
Policy type
Company
Policy
number
Death
benefit
Comments
Annual
premium
Sharon
Superannuation
fund
TPD
ABXY Super
Fund
XTP1234
$50,000
Within
superannuation
From
superannuation
Income protection insurance details

Life insured
Owner
Policy type
Company
Sharon
n.a.
nil
n.a.
Policy
number
Page 22 of 63
Benefit
amount
Waiting
period
Benefit
payment
period
Annual
premium
General insurance details

Item covered
Owner
Policy type
Company
Combined
Cover
policy number amount
Other benefit Total annual

premium
Car
Sharon
Comprehensive
Ourcover
234907MV
Market Value
nil
$1,300
Contents
Sharon
Contents
Ourcover
438129HC
$20,000
nil
$360 p.a.
deducted
monthly from
credit card
Health
Sharon
Full health
Ourcover
6978/967PH
$1,440 p.a.
deducted
monthly from
credit card
Investment details
Investment type
Company
Purchase date
Term deposit
East Antipodean National Wealth Bank
Shares
Westpac Banking Corporation
Savings account
East Antipodean National Wealth Bank
Units
held/fixed
rate
n.a.
25 November 2008
n.a.
70 shares
Current
value
Owner
$45,000
Sharon
$2,100
Sharon
$1,500
Sharon
Note: An insurance needs analysis is not required for this assignment. These risk needs tables have been
included to provide a realistic example of the fact-finder process.
Page 23 of 63
Risk needs
Insurance needs life
Sharon
C
Clean-up fund
Settle all outstanding accounts, including credit cards, bills and funeral costs
Income fund
The lump sum required to produce a level of regular income that maintains the familys living
standard for a defined period
Mortgage fund
The amount necessary to discharge any existing mortgages
Education fund
Lump sum determined by calculating each childs education costs and multiplying by the
number of years of school and/or university remaining
Retirement fund
The lump sum necessary to provide adequate funding for retirement
less value of realisable assets
less existing life insurance cover

Recommended sum insured
Recommended sum insured (rounded up to the nearest $10,000)
Page 24 of 63
Insurance needs TPD

Sharon
C
Clean-up fund
Settle all outstanding accounts, including credit cards, bills and funeral costs
Income fund
The lump sum required to produce a level of regular income that maintains the familys living
standard for a defined period
Mortgage fund
The amount necessary to discharge any existing mortgages
Education fund
Lump sum determined by calculating each childs education costs and multiplying by the
number of years of school and/or university remaining
Retirement fund
The lump sum necessary to provide adequate funding for retirement
less value of realisable assets
less existing life insurance cover

Page 25 of 63
Insurance needs Trauma

Sharon
Funds required to pay out home mortgage
Estimated medical and rehabilitation costs (including cover out-of-pocket health costs)
Other debts
Other expenses
less existing realisable assets
Insurance needs Income protection

Sharon
Gross annual income
SG
Total insurable income
Monthly income (i.e. total insurable income / 12)
Recommended monthly benefit (i.e. 75% of total monthly insurable amount)
Benefit payment period
Waiting period to be served
Acknowledgment
The information provided in this financial fact finder is complete and accurate to the best of my knowledge.
I understand that a policy purchased without the completion of a fact finder, or following a partial or inaccurate completion,
may not be appropriate to my needs. I also understand that a policy purchased that differs from that recommended by the planner
may not be appropriate to my needs. I acknowledge that the planner has provided me with the completed financial fact finder,
signed by me.
Customer(s) signature(s)
Planners name
Planners signature
Date
Page 26 of 63
Investment attitude details

Please answer the following questions regarding your attitude to financial issues.
Are you concerned about the amount of tax that you are paying? Why?
Yes/No
I think that I should be able to structure things better to pay less tax like other people seem to do.
How important is liquidity (i.e. funds available) to you? Why?
Very/Moderately/Not
I would like the money available so I can buy a property in the future.
If you had funds available for investing, how would you choose to invest them? Why?
Term deposits, but dont know what else is available or how it works.
Are there certain sorts of investment that you wish to avoid? Which ones?
Yes/No
I dont really know.
Risk profile
Determining your investor risk profile
Points
This investor risk profile questionnaire has been designed to help you understand the type of investor you are, so that with the help
of your planner, you can choose the investments that best match your financial objectives.
Which of the following best describes your current stage of life?
Single with few financial commitments: You are keen to accumulate wealth for the future. Some funds
must be kept available for enjoyment, such as cars, clothes, travel and entertainment.
50
A couple without children: You may be preparing for the future by establishing and furnishing a home.
There are a lot of things you need to buy. You are probably better off financially now than you may be in
the future.
40
Young family: This is the peak home purchasing stage. You have a mortgage and a very small amount of
savings. Probably dissatisfied with your financial position and the amount of money saved.
35
Mature family: You are in your peak earning years and have got the mortgage under control.
Many partners also work and any children are growing up and have either left home or require less
supervision. You are starting to think about retirement, although it may be many years away.
30
Preparing for retirement: You probably own your own home and have few financial commitments,
however, you want to ensure that you can afford a comfortable retirement. Interested in travel, recreation
and self-education.
20
Retired: No longer working you must rely on existing funds and investments to maintain your lifestyle.
You may be receiving the pension and are keen to enjoy life and maintain your health.
10
What return do you reasonably expect to achieve from your investments?

A return without losing any capital.
10
37% p.a.
20
812% p.a.
30
1315% p.a.
40
Over 15% p.a.
50
Page 27 of 63
If you did not need your capital for more than 10 years, for how long would you be prepared to see your investment performing
below your expectations before you cashed it in?
You would cash it in if there were any loss in value
10
Less than 1 year
20
Up to 3 years
30
Up to 5 years
40
Up to 7 years
45
Up to 10 years
50
How familiar are you with investment markets?

Very little understanding or interest
10
Not very familiar Would like to know more
20
Have had enough experience to understand the importance of diversification
30
Understand that markets may fluctuate and that different market sectors offer different income, growth
and taxation characteristics
40
Experienced with all investment sectors and understand the various factors that may influence
performance
50
If you can only get greater tax efficiency from more volatile investments, which balance would you be most
comfortable with?
Preferably guaranteed returns, before tax savings
10
Stable, reliable returns, minimal tax savings
20
Some variability in returns, some tax savings
30
Moderate variability in returns, reasonable tax savings
40
Six months after placing your investment you discover that your portfolio has decreased in value by 20%.
What would be your reaction?
50
Horror. Security of capital is critical and you did not intend to take risks
10
You would cut your losses and transfer your money into more secure investment sectors
20
You would be concerned, but would wait to see if the investments improve
30
This was a calculated risk and you would leave the investments in place, expecting performance to improve
40
You would invest more funds to lower your average investment price, expecting future growth
50
Which of the following best describes your purpose for investing?

You want to invest for longer than five years, probably to the age of 5560. You are mainly investing for
growth to accumulate long-term wealth
50
You are not nearing retirement, have surplus funds to invest and you are aiming to accumulate
long-term wealth
40
You have a lump sum, e.g. an inheritance or an eligible termination payment from your employer, and you
are uncertain about what secure investment alternatives are available
30
You are nearing retirement and you are investing to ensure that you have sufficient funds available to
enjoy retirement
20
Page 28 of 63
You have some specific objectives within the next five years for which you want to save enough money
20
You want a regular income and/or totally protect the value of your savings
10
Investor profile total points
200
INVESTOR RISK PROFILE SUMMARY

60120
Conservative 70% Defensive and 30% Growth
You are a conservative investor. Risk must be very low and you are prepared to accept lower returns to protect capital. The negative effects
of tax and inflation will not concern you, provided that your initial investment is protected
120180
Moderately Conservative 55% Defensive and 45% Growth
You are a cautious investor seeking better than basic returns, but risk must be low. Typically an older investor seeking to protect the wealth
that you have accumulated, you may be prepared to consider less aggressive growth investments
180240
Balanced 40% Defensive and 60% Growth
You are a prudent investor who wants a balanced portfolio to work towards medium to long-term financial goals. You require an
investment strategy that will cope with the effects of tax and inflation. Calculated risks will be acceptable to you to achieve good returns
240270
Growth 20% Defensive and 80% Growth
You are an assertive investor, probably earning sufficient income to invest most funds for capital growth. Prepared to accept higher
volatility and moderate risks, your main concern is to accumulate assets over the medium to long term. You require a balanced portfolio,
but more aggressive investment strategies may be included
270300
High growth 20% Defensive and 80% Growth
You are an aggressive investor prepared to compromise portfolio balance to pursue potentially greater long-term returns.
Your investment choices are diverse, but carry with them a higher level of risk. Security of capital is secondary to the potential
for wealth accumulation
Page 29 of 63
Appendix 2: Financial planning questions

Case study questions
Section 1: Questions Establishing relationships with clients
Answer the following questions in the spaces provided. The questions are your opportunity to demonstrate
your ability to establish a relationship with a client.
Section 1 Part A
Preparation by both the client and the planning team is essential to a successful client meeting.
Describe the preparation that should be made to ensure the success of the initial interview held in your
office. (250 words)
Answer here
Assessor feedback:
Resubmission required?
No
Section 1 Part B
List the documents that you would provide a client during, or prior to, the initial meeting. Explain the
contents of each document and why they are necessary. (200 words)
Answer here
Assessor feedback:
No
Section 1 Part C
Outline how you would develop rapport with a client during your first meeting. (200 words)
Answer here
Assessor feedback:
No
Page 30 of 63
Section 1 Part D
Explain to a client the role of the adviser and the relationship with the licensee. Ensure you use language
that your client would understand. (250 words)
Answer here
Assessor feedback:
No
Section 1 Part E
What ways would you use to maintain and develop your knowledge and advising skills, and your obligations
under the relevant legislation? (150 words)
Answer here
Assessor feedback:
No
Section 1 Part F
It is important that your clients understand your companys dispute resolution procedure.
Explain, step-by-step, a typical internal and external complaints resolution processes available to a client.
(150 words)
Answer here
Assessor feedback:
No
Page 31 of 63
Section 2: The fact finder and risk profile

There are no questions for this section.
Section 3: Questions Analysing the data

your ability to analyse a clients needs in preparation for developing a strategy that aligns with their
requirements.
Section 3 Part A
List what you understand to be Sharons goals, needs and objectives. Categorise them into short,
medium and long-term time frames. They should be specific, measurable and have a nominated dollar
value where possible. (250 words)
Goals/need/objectives
Time frame
Dollar value
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Assessor feedback:
No
Page 32 of 63
Section 3 Part B
Analyse the data provided by Sharon by answering the following questions. The questions are designed to
help you think about the possible issues that any client may have and enable you to show your skill in
analysing a case study across the 11 general headings in the data analysis section of the text, and strategy
development steps of the financial planning process (refer to Topic 2 and the sample case study and
sample SOA).
Think carefully about your responses and do not assume that you are in a position to provide detailed
answers to every question. You may not have enough information, it may be outside of your licensees
designated authority for this case study (i.e. the matter needs to be referred to a specialist adviser), or it is
not one of Sharons goals or objectives. In addition, the question may not apply to Sharons current
situation. Where any of the above apply, you still need to make a comment and explain why the question is
not relevant at this time.
Make sure you constantly refer to the data you have on Sharon so your responses accurately reflect the
information she has provided you.
The questions
Your response
Does Sharon need a debt

management solution?
Answer here
If yes, why?
If no, why not?
Answer here
b.
Sharon has stated that she is

comfortable with her current
insurance arrangements;
however, does Sharon have
adequate risk protection?
Provide reasons for your answer.
Answer here
c.
Does Sharon have sufficient

savings to meet her goals?
Answer here
If yes, why/how?
If not, how much does she need?
And by when?
Answer here
Does Sharon have any

investments currently, and what
is her appetite for different types
of investment?
Answer here
What will this mean for any

strategy you might recommend?
Answer here
Are there any present and/or

anticipated future taxation
issues?
Answer here
If yes, why and what are they?

If no, why not?
Answer here
Has any provision been made for

estate planning?
Answer here
What could be put in place now

for any anticipated
requirements?
Answer here
a.
d.
e.
f.
The assessors feedback
Page 33 of 63
Section 4: Questions Developing a strategy

your ability to analyse a clients needs and develop a strategy that aligns with their requirements.
Section 4 Part A
Based on your analysis of the data, describe in general terms, the strategies you think will best meet
Sharons needs describing the reasons why such strategies are adopted. Include what other specialist
advice Sharon should source so that her financial plan is comprehensive. (400 words)
Answer here
Assessor feedback:
No
Section 4 Part B
You are now in a position to research some products that might meet Sharons needs. Information on
different products are readily available on the internet. For example, for managed funds,
http://www.morningstar.com.au provides a fund screener tool that you can use to select funds based on a
number of different criteria, (located under Tools on the homepage). For term deposits and other
investments, go to http://www.canstar.com.au. To ensure the appropriate product(s) for your client, you
are expected to research a number of products from different product issuers (more than two). The URL
link should be supplied.
List the investment products you have researched here, and indicate why you think each investment you
have researched may or may not be suitable for Sharon. At the conclusion of this process you will need to
have found at least two (2) products to meet your clients needs.
The product
(name and URL link)
Why you think it may or may not be

the best fit for Sharon.
Indicate which
product/s you
will use in
your plan
Answer here
Answer here
Yes
No
Answer here
Answer here
Yes
No
Answer here
Answer here
Yes
No
Answer here
Answer here
Yes
No
Page 34 of 63
Section 5: Completing the SOA

When you have determined the financial planning recommendations you believe will meet Sharons needs
then you need to prepare her SOA. Use the SOA template provided in this assignment to produce your SOA
for Sharon.
Tip: The assessor is looking for an SOA that is of a professional standard and is suitable for presentation to a
client. This means your spelling and grammar needs to be correct and that you have written your
recommendations so the client can understand them. Remember: the SOA is an important communication
tool you can use to engage your client. A hastily written and poorly presented SOA does not engender
client trust or confidence in your expertise or professionalism.
Important instructions for completing the SOA

1. Use the SOA template provided.
SOA preparation software: The use of financial planning software and dealer templates to prepare your
SOA is not permitted. Submissions that exhibit excessive reliance on SOA templates may be considered a
case of plagiarism or collusion and may not be considered to be a reasonable attempt at the
assessment.
2. Your SOA must include strategy recommendations for:
debt management
personal investment and savings
asset allocation (including superannuation).
3. You must prepare an implementation schedule detailing all of the recommendations in the SOA
and provide the details in the implementation schedule within the SOA.
4. You must also prepare, using an Excel spreadsheet, a table showing the projected balance of Sharons
investment portfolio, over a five-year period, before and after your recommendations. This task will be
important in showing how your strategies may satisfy Sharons primary financial objective.
5. List any assumptions you have made to complete your SOA on the assumptions page at the end of the
SOA. Assumptions will generally be made:
regarding missing background information on the clients
in regards to calculations of future returns from your recommended investments
for clarity in relation to any of your recommendations
for fees relating to the products you have recommended.
6. While you are not required to provide specific recommendations in the following areas for this
assignment, you will need to provide, in the Things you need to consider section of your SOA,
appropriate comments about any issues you have identified. Those areas are:
personal insurance
superannuation
estate planning.
7. Your investment product recommendations will need to be based on the research you conducted in
section 4 Part B. Please do not include any product disclosure statements (PDSs) with your
assignment submission.
Page 35 of 63
Section 6: Questions Presenting the SOA

your ability to work with a client to present a financial plan, and then take the necessary steps to gain their
consent to implement your recommendations.
Section 6 Part A
Identify two (2) concerns that Sharon may have with the advice that you have provided. Prepare responses
to these concerns. Ensure that you use language Sharon would understand. (100 words)
Answer here
Assessor feedback:
No
Section 6 Part B
Outline the techniques that could be used to ensure that your client understands the advice being provided
and to gain their agreement to implement the plan. (150 words)
Answer here
Assessor feedback:
No
Section 6 Part C
According to legislative requirements, explain how you would present your fee and cost structure to
Sharon. (100 words)
Answer here
Assessor feedback:
No
Page 36 of 63
Section 6 Part D
List the documentation, if any, that you need to present to your client at this stage of the financial planning
process. (50 words)
Answer here
Assessor feedback:
No
Section 6 Part E
Provide a summary of all the documentation that you need to keep in the clients file. (150 words)
Answer here
Assessor feedback:
No
Section 7: Questions Providing ongoing service

your ability to work with a client to implement a plan over the longer term.
Section 7 Part A
Sharon is not sure she will have time for regular reviews of her financial plan. She expresses the opinion
that the advice seems comprehensive and she believes she could take a set and forget approach once it is
implemented. Describe how you would respond to Sharon, highlighting why reviews are important. In
addition, provide details of the type, form and frequency of the ongoing service that would ideally be
provided and the fees/costs associated with this service. (400 words)
Answer here
Assessor feedback:
No
Page 37 of 63
The SOA template

An SOA has been commenced for Sharon Elsom, using the data collected in the interviews, her fact finder
and risk profile. You will need to complete the remaining sections in the SOA as directed. Please review the
sample case study and the text as a guide to completing your SOA.
Statement of advice
Prepared for
Sharon Elsom
Prepared by
<Your name>
Authorised Representative Number: 66666
AR Address
AR contact details
Authorised Representative of
NANCA Financial Planning
ABN: 1010101010
Australian Financial Services Licensee
Licence No. 101010
Head office: 88 Money Lane, Accumulation.
You are entitled to receive a statement of advice (SOA) whenever we provide you with any personal financial advice.
Personal financial advice is advice that takes into account any one or more of your objectives, financial situation and needs.
This SOA is a record of the personal financial advice provided to you and includes information on the basis on which this advice is
given, information about fees and commissions and any interests or associations which might influence the advice.
If this advice includes a recommendation to you to acquire a particular financial product, other than securities, or an offer to issue
or arrange the issue of a financial product to you, we will also provide you with a product disclosure statement containing
information about the particular product to help you make an informed decision about that product.
Be aware that the advice contained in the following SOA is valid for a period of 30 days only. If the plan is not implemented within
this time, it will need to be reviewed for accuracy.
Page 38 of 63
Executive summary
In this section, you need to provide your client with a concise summary of:
their situation
their objectives
your recommended strategy to achieve the objectives
the outcomes your client can expect from adopting the strategy.
The client should be able to read this executive summary and understand the advice you are giving,
the reason/s for underpinning the advice, and be able to determine whether or not their goals have been
achieved. There should be sufficient detail to allow the client to make a decision, taking into account any
risk/s involved and your fees. It should be written in clear, unambiguous language, without jargon and be
appropriate to their level of financial understanding.
Your situation
This is where you need to summarise your clients current situation.
Answer here
Assessor feedback:
No
Your objectives
This is where you need to list your clients objectives (i.e. their financial and non-financial goals, objectives
and needs).
Answer here
Assessor feedback:
No
Page 39 of 63
Summary of our strategy and recommendations

For the short term up to one year
This is where you need to summarise your short-term recommendations for your client.
Answer here
Assessor feedback:
No
For the medium term one to five years

This is where you need to summarise your medium-term recommendations for your client.
Answer here
Assessor feedback:
No
Summary of expected outcomes if you implement our advice

For example:
Should you proceed with the recommendations contained within this report, we estimate that:
You will reduce your debt by $XYZ and/or save $ABC.
You will build wealth in non-superannuation assets through regular contribution of $X.
Answer here
Assessor feedback:
No
Page 40 of 63
Risks in our advice

Refer to the sample SOA for examples of relevant descriptions that should be included here and under each
subheading below.
Answer here
Assessor feedback:
No
Summary of our fees and commissions

Answer here
Assessor feedback:
No
Your next steps

Refer to the sample SOA for examples of relevant descriptions that should be included here.
Answer here
Assessor feedback:
No
Page 41 of 63
Body
While this section contains similar headings as the executive summary, the information provided is at a
greater level of detail and supports the recommendations made. As with the executive summary, it should
be written in clear, unambiguous language, without jargon and be appropriate to your clients level of
financial understanding.
Section 1: Important information about you

This section contains information about you that we used in preparing our advice, such as:
your reasons for seeking advice
what you would like to achieve
your personal and financial information.
Present position
Your reasons for seeking advice
Outline why the client sought advice.
Answer here
Assessor feedback:
No
What you would like to achieve

Summarise here what you understand to be your clients main objectives.
Following our discussions, here is what I/we understand to be your main objectives and needs:
Answer here
Assessor feedback:
No
Page 42 of 63
Your personal and financial information

Listed below is a summary of your relevant personal and financial details that you have provided.
Personal information
Personal details
Client 1
Client 2
First name(s)
Sharon
Surname
Elsom
Date of birth
15 September 1986
Marital status
Single
Health status
Smoker status
Non-smoker
Employment status
Permanent
Employer name
Occupation
Sales Manager
Annual salary
$82,000
Summarise the discussion points that could/need to be raised here.

Answer here
Assessor feedback:
No
Children and dependant details

You currently have no dependants.
Your existing insurance

Personal insurance
$50,000 life/TPD inside superannuation
Car insurance
$1,300
Home contents Insurance
$336
Health insurance
$1,440
Page 43 of 63
Your existing estate planning

Summarise the clients existing estate planning provisions here.
Answer here
Assessor feedback:
No
Financial information
Current income and expense details
Income and expenses
Client 1
Assessable income
$83,649
Income after tax
$63,428
Yearly expenses
$50,815
Estimated surplus
$12,613
Client 2
Total
Discussion points:
Answer here
Assessor feedback:
No
Page 44 of 63

Value
Liability
Net value
Home
Home contents
20,000
Motor vehicles
37,000
37,000
Personal assets
Employer superannuation
Savings account
Term deposit
32,000
1,500
45,000
Investment assets
Shares
Net worth
2,100
100,600
Discussion points:
Answer here
Assessor feedback:
No
Incomplete and/or inaccurate information warning

Note that if, for any reason, the information on which our advice is based is incomplete or inaccurate,
then it may not be appropriate and you should, before acting on the advice consider its appropriateness,
in light of your particular circumstances, needs and objectives.
Page 45 of 63
Your risk profile

In this section, you need to provide:
an overview of the different risk profiles
asset classes and risk and return
the clients risk profile including the appropriate mix of assets (the asset allocation) for the clients risk
profile, the appropriate investment return time horizon for that profile and any specific concerns.
Answer here
Assessor feedback:
No
Page 46 of 63
Strategy recommendations
This section tells you:
what our advice is and why it is appropriate for you
reasons for our recommendations
what you need to consider and any risks associated with our advice.
Read this section carefully and ask me if you have any questions.
Recommended action first year

You will use your findings from the analysis you did in Section 4 of the assignment above as the basis for the
information you will need to provide in this section.
For each recommendation below, discuss the reasons, risks, advantages and disadvantages.
All recommendations should be listed here. They are to include investment and debt management
recommendations. You are not required to provide specific advice to your client about her insurance,
superannuation and estate planning needs. However, if after analysis of her situation you believe that
advice is required, you need to explain what advice she should seek and why.
Note: Not all of the recommendation boxes below need to be completed. Alternatively, you can add more
boxes if required.
Recommendation 1
Answer here
Assessor feedback:
No
Recommendation 2
Answer here
Assessor feedback:
No
Recommendation 3
Answer here
Assessor feedback:
No
Page 47 of 63
Recommendation 4
Answer here
Assessor feedback:
No
Recommendation 5
Answer here
Assessor feedback:
No
Page 48 of 63
Things you should consider

Refer to the sample SOA for examples of relevant descriptions that should be included here and under each
subheading below.
Answer here
Assessor feedback:
No
Insurance
Answer here
Assessor feedback:
No
Estate planning
Answer here
Assessor feedback:
No
Taxation issues
Answer here
Assessor feedback:
No
Page 49 of 63
Recommended asset allocation

Proposed asset allocation
Your investment assets are invested across various asset classes. The table below summarises:
Weight: The proposed asset allocation resulting from our recommendations.
Risk profile weight: The recommended asset allocation for your investment risk profile.
Variance (weight): The variance between the recommended and proposed asset allocation.
Comments on proposed asset allocation versus your risk profile

Refer to Topic 4 in your subject notes to assist you in completing this section.
Asset allocation after implementation of recommendations

Asset allocation
Weight
Risk profile weight
Variance (weight)
Australian cash
Answer here
Answer here
Answer here
Australian fixed interest
Answer here
Answer here
Answer here
International fixed interest
Answer here
Answer here
Answer here
Total for defensive assets
Answer here
Answer here
Answer here
Australian equities
Answer here
Answer here
Answer here
Australian property
Answer here
Answer here
Answer here
International equities
Answer here
Answer here
Answer here
International property
Answer here
Answer here
Answer here
Total for growth assets
Answer here
Answer here
Answer here
Grand total
Answer here
Answer here
Answer here
Defensive assets
Growth assets
You need to explain the reason for any large, (greater than 10%) variances here. Refer to the sample SOA for
a discussion on variances.
Assessor feedback:
No
Page 50 of 63
Investment and insurance product recommendations

Product recommendations
Note that I can only recommend products on our recommended list, which have been approved by NANCA
Financial Planning.
As part of this advice we are not providing any specific recommendations concerning your insurance
requirements as you have requested that we do not review them at this time. However, as part of our
analysis, we have made comments for your future action.
Use the space below to list the products that you are recommending Sharon invest in, and those that she
already has that you are recommending she keep.
Sharon Elsom, following our investment strategy, we recommend that you invest in the following products:
Answer here
Assessor feedback:
No
Relevant research material and PDSs are attached for your attention. It is important that you read these
documents carefully and contact us should you have any questions or if there are areas of the document
that you do not fully understand. All of these products are on our approved recommended list.
Note: You do not need to include these PDSs as part of your assignment. The above statement is a standard
inclusion in an SOA.
Cooling-off period
Details on the cooling-off period for each product are provided in the PDS.
Page 51 of 63
Disclosure of remunerations, commissions and other

benefits
How are we paid?
Commissions and fees upfront, ongoing and financial planning advice fees
If you are charging SOA preparation fees, implementation fees, on-going advice fees, or any other nonproduct related fees you must provide the details here. You may need to source information outside of the
subject notes to complete this requirement. However, you can use the examples of how fees are shared
between advisers and licensees from the sample SOA if needed.
If you are not charging these fees you may either delete the table below or fill it in with $0 as the fee
charged to make it clear.
Fee type
Initial fee
Initial fee paid to licensee
Initial fee paid to adviser
SOA fee
Answer here
Answer here
Answer here
Implementation fee
Answer here
Answer here
Answer here
Ongoing advice fee*
Answer here
Answer here
Answer here
Total
Answer here
Answer here
Answer here
*If the ongoing service fee is charged as a percentage of the product(s) you may use the table below
instead. If you are charging a flat fee, or an hourly fee you should use this table.
Investment recommendations
Summarise all of the products that you have recommended to the client here. Refer to the sample SOA for
examples of what to include. You will need to source information outside of the subject notes to complete
this table, based on the products you have used (or created).
If you wish to implement the products I have recommended, there may be initial and ongoing fees
applicable as detailed below.
Product
Initial fee
Initial fee paid to

licensee
Initial fee paid to

adviser
Ongoing fees
paid to licensee
Ongoing fees
paid to adviser
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Total
Answer here
Answer here
Answer here
Answer here
Answer here
Note: Please see the sample SOA for directions on completing the answers in the paragraphs below.
Neither NANCA Financial Planning nor I will receive initial or ongoing commission for any investment or
superannuation recommendations. Where applicable they will be rebated to you. However, you may also
be charged fees for purchasing and investing in some products we recommend.
Product providers will also charge a fee for the management of the funds invested in their products.
The annual management fee charged by is Answer here%. The amount you will be charged will depend on
the funds you have invested.
Page 52 of 63
For example, $Answer here invested with them will incur a $Answer here annual management cost.
All details regarding fees and costs are contained in the fund manager PDSs provided. There is no entry fee
for depositing funds into this account and no withdrawal fee should you decide to withdraw funds.
Assessor feedback:
No
Other fees and benefits

NANCA Financial Planning and I may also receive additional benefits. Where the benefits received are
greater than $300 in value, they will be recorded in a register that meets the requirements of the
Financial Planning Association (FPA) Code of Practice on alternative forms of remuneration. A copy of the
register for NANCA Financial Planning is publicly available and can be provided upon your request.
Page 53 of 63
Ongoing services
You need to make sure that your client fully understands what you are offering in terms of ongoing service.
Use the space below to record the details of how you will manage this process.
Refer to the sample SOA for the sorts of services you could include here.
Answer here
Assessor feedback:
No
Page 54 of 63
Implementation schedule
In order to ensure that your recommendations will be implemented efficiently, you need to make sure that
all tasks that need to be completed, both by the client and yourself, are itemised in the schedule.
The schedule should highlight the priority of each task, as well as the order of completion. The time frame
should be as specific as possible.
Sharon Elsom, in order to proceed with our recommendations, you will need to complete the steps below:
Action
By who
By when
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Note: The recommendations contained in this SOA are current for 30 days only. Please contact me for
further discussion if you are unable to act on our recommendation within this time frame.
Assessor feedback:
No
Page 55 of 63
Authority to proceed
By signing this authority to proceed, I/we Sharon Elsom acknowledge the following:
I/We acknowledge that the information I provided in the financial needs analysis has been used to arrive
at the recommendations contained in this SOA.
I/We have read, understood and retained a copy of the SOA prepared by <Your name> dated <Date>.
This document contains information which accurately summarises my/our current situation,
investments and financial objectives.
I/We have been provided with an NANCA Financial Planning FSG.
I/We have read and understood the PDSs for the recommended products.
Please note that a cooling-off period may apply to your initial investment or insurance policy. Refer to
the PDS.
I/We acknowledge that the product(s) listed in the table below are to be implemented in
my/our name/s:
Product(s)
Amount
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
I/We wish to make the following change/s to the recommendations within the SOA
Product(s)
Amount
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Signed ________________________________
Client Name
Date ___ / ____/ ____
Signed ________________________________
Client Name
Date ___ / ____/ ____
Signed ________________________________
Financial Planner
Date ___ / ____/ ____
Page 56 of 63
Consent to ongoing contact

I/We consent to being contacted by our adviser on an ongoing basis, in line with the agreed ongoing service
review structure detailed within this recommendation. My/our preferred hours of contact are between
____ and ____.
Signed ________________________________
Client Name
Date ___ / ____/ ____
Signed ________________________________
Client Name
Date ___ / ____/ ____
Page 57 of 63
Cash flow tables

Use the How to complete a cash flow table resource provided in KapLearn for guidance on how to
complete the following tables for your client. Additionally, refer to the sample case study and sample SOA.
Financial position after implementation of strategy

Note: The items listed in this template are indicative only and must be adapted to your clients personal
circumstances. There may be other relevant income or expense items that are not included in this template.
You should add, delete or substitute items where appropriate.
Income, tax and cash flow

Tax calculation
Client 1
Client 2
Notes
Income from employment

Salary
Answer here
Answer here
Salary sacrifice
Answer here
(state % if applicable)
Salary after salary sacrifice
Answer here
Answer here
Bank account interest
Answer here
(state % return if applicable)
Interest from other investments
Answer here
(state % return if applicable)
Share dividends
Answer here
(state % return if applicable
Imputation credits
Answer here
(state % return if applicable
Other income liable for tax (e.g. rental income)
Answer here
Answer here
Assessable capital gains
Answer here
Answer here
Total assessable income
Answer here
Answer here
Deductable expenses (e.g. rental repairs)
Answer here
Answer here
Taxable income
Answer here
Answer here
Income tax on taxable income
Answer here
(state tax rates and year applied)
less tax offsets (e.g. LITO/SAPTO)
Answer here
Answer here
plus Medicare levy
Answer here
Answer here
plus Medicare levy surcharge
Answer here
Answer here
less Imputation credits
Answer here
Answer here
less refundable tax offsets
Answer here
Answer here
Net tax payable
Answer here
Answer here
Other income
Page 58 of 63
Family cash flow
Client 1
Client 2
Combined
Comment
Cash flow calculation:

Salary less any salary sacrificed amount
Answer here
Answer here
Answer here
Non-taxable income (e.g. income from a

superannuation pension for a person aged over 60,
Family Tax Benefits, etc.)
Answer here
Answer here
Answer here
Interest income
Answer here
Answer here
Answer here
Dividends received (excluding franking credits)
Answer here
Answer here
Answer here
Other income
Answer here
Answer here
Answer here
Total income received before tax
Answer here
Answer here
Answer here
Investment expenses
Answer here
Answer here
Answer here
Living expenses
Answer here
Answer here
Answer here
Other expenses
Answer here
Answer here
Answer here
Total expenses
Answer here
Answer here
Answer here
Total income received before tax less expenses
Answer here
Answer here
Answer here
Net tax payable from tax table above
Answer here
Answer here
Answer here
Total net cash flow
Answer here
Answer here
Answer here
Page 59 of 63
Asset
Owner
Value
Liabilities
Net value
Notes
Family home
Answer here
Answer here
Answer here
Answer here
Answer here
Home contents
Answer here
Answer here
Answer here
Answer here
Answer here
Car 1
Answer here
Answer here
Answer here
Answer here
Answer here
Car 2
Answer here
Answer here
Answer here
Answer here
Answer here
Other
Answer here
Answer here
Answer here
Answer here
Answer here
Total
Answer here
Answer here
Answer here
Answer here
Answer here
Client 1 superannuation
Answer here
Answer here
Answer here
Answer here
Answer here
Client 2 superannuation
Answer here
Answer here
Answer here
Answer here
Answer here
Total
Answer here
Answer here
Answer here
Answer here
Answer here
Investment property
Answer here
Answer here
Answer here
Answer here
Answer here
Savings account
Answer here
Answer here
Answer here
Answer here
Answer here
Term deposit
Answer here
Answer here
Answer here
Answer here
Answer here
Shares
Answer here
Answer here
Answer here
Answer here
Answer here
Other
Answer here
Answer here
Answer here
Answer here
Answer here
Total
Answer here
Answer here
Answer here
Answer here
Answer here
Net worth
Answer here
Answer here
Answer here
Answer here
Answer here
Personal assets
Superannuation
Investment assets
Page 60 of 63

Liabilities
Loan
Current debt
Percentage deductible
Interest only
Repayment
Loan
Answer here
Answer here
Answer here
Answer here
Home loan
Answer here
Answer here
Answer here
Answer here
Investment property
Answer here
Answer here
Answer here
Answer here
Other
Answer here
Answer here
Answer here
Answer here
Total
Answer here
Answer here
Answer here
Answer here
Page 61 of 63
Five-year projections
Five-year projection table
In order to show the effect of your recommendations over the period of time the financial goal is required
to be satisfied (in this case a maximum of five years), you will need to complete relevant projections over
that period. The projection table should show Sharon that the recommended strategies and accompanying
products will achieve the savings goal for her unit purchase in the time required, if not earlier.
Required
Use a Microsoft Excel spreadsheet to project the balance of the clients investment portfolio for five years
before and after your recommendations. You should show the comparison between the investment growth
for the current investment (e.g. the term deposit) and the recommended investment strategy. For your
comparison, you should assume that the term deposit will be rolled over for a five-year term.
You can use the FV formula in Excel to calculate annual balances for the accumulation of the portfolios.
At the end of the five year period you should show the net benefit of the strategy on the investment
amounts.
Hints for using the FV formula in Excel to predict account balances are provided in your subject notes.
Copy the projections into Table 1 (double-click to open in Excel) and complete the list of assumptions in
Table 2.
Please ensure that you use a real rate of return that is appropriate to the clients portfolio, both current
and proposed.
Account balance projections

Table 1
Time period
Start
Year 1
Year 2
Year 3
Year 4
Year 5
Current situation
Portfolio value (assume all income is
reinvested)
Proposed Investment
Portfolio value (assume all income is
reinvested)
Page 62 of 63
Appendix 3: Assumptions
Table 2
Value
Current situation
Proposed strategy
Return period (monthly or annual)
Answer here
Answer here
Real rate of return: Capital growth
Answer here
Answer here
Real rate of return: Income
Answer here
Answer here
Other
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Answer here
Page 63 of 63

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Assignment

Financial Planning (DFP1B_AS_v1A3)

Assignment result (assessor to complete)

Parts that must be resubmitted:

Result resubmission (if applicable)

Case study assignment

Result summary (assessor to complete)

Resubmission (if required)

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Cash flow tables

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Feedback (assessor to complete)

Before you begin

About this document

How to use the study plan

How to use the sample case study and SOA in KapLearn

Part 1: Instructions for completing and submitting

The Sharon Elsom case study

Fact finder and risk profile

Saving your work

Submitting the assignment

The assignment marking process

Make a reasonable attempt

How your assignment is graded

Not yet competent and resubmissions

Provide advice in financial planning

Conduct financial planning analysis and research

Develop and prepare financial plan

Implement financial plan

Review financial plans and provide ongoing service

Determine client financial requirements and expectations

Apply principles of professional practice to work in the financial services industry

Develop and use complex spreadsheets

Establish client relationship and analyse needs

Develop, present and negotiate client solutions

Provide general advice on financial products and services

We are here to help

Part 2: The case study

Section 1: Meeting your client

Given & preferred names

16/118 Gloucester St, Brunswick East, Vic.

(03) 7766 5544

Expected retirement age

Havent really thought about it, but probably 62

The first meeting

Collecting the data

Sharons current situation

Sharons needs and objectives

Australian fixed interest