Question

1. There are two fundamental principles that establish whether advice given by a financial advisor is appropriate. To meet these principles advisors must:

a) Provide fee disclosure and full disclaimers to clients regarding the cost of advice, biases, and warnings

b) Provide Statements of Advice, Statements of Additional Advice, Statements of Limited Advice or Records of Advice whenever personal advice has been provided

c) Have clients undertake risk tolerance and longevity analysis and complete fact find before advice can be provided

d) Gather sufficient data to know the client and do sufficient research to know the product

Answer 1

Answer-

The correct Option is b.
Provide Statements of Advice, Statements of Additional Advice, Statements of Limited Advice or Records of Advice whenever personal advice has been provided.

The other Options are a, c and d are incorrect.

The Opion a is incorret as fee disclosures can be provided and some disclosures muust be provided and full disclosures are needed when required.

The Option c is incorrect as clients are not required to undertake risk tolerance and longevity analysis.

The Option d is incorrect as some data is required to know about the client.