The Financial Markets Authority (FMA) of New Zealand has released an information sheet for advisers, setting out how they can demonstrate compliance with record-keeping obligations.
Under the new financial advice regime introduced in March last year, one of the conditions requires advisers to “create in a timely manner and maintain adequate records in relation to your financial advice service”.
The New Zealand regulator said the information sheet provides an overview of the record keeping obligations and sets out areas for financial advice providers to consider when reviewing their record keeping practices.
It also includes examples to illustrate how an adviser can demonstrate compliance with the requirements.
“Our monitoring of the previous financial advice regime consistently identified poor record keeping as an area of concern,” FMA Director of Supervision James Greig said.
“This included insufficient records about the services provided to clients and incomplete information on whether key obligations had been fulfilled.”
He said good record-keeping ultimately helps financial advice providers to demonstrate that they are serving client interests.
“We know that many financial advice providers are adapting and evolving their processes to comply with this standard condition, so we are trying to help the industry with this practical information sheet,” Mr Greig said.
The information sheet says advisers should consider developing arrangements for keeping records. Arrangements include the processes, systems and controls that advisers maintain for keeping records that support them in meeting their obligations.
Processes, systems and controls for keeping records should be appropriate for the advice business and need not be overly complex, the information sheet said.
Additionally, care should also be taken to put in place arrangements for non-financial advice related records, according to new.com.au.