FPAM Code of Ethics

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Table of Contents
Chapter 1
CODE OF ETHICS AND

PROFESSIONAL RESPONSIBILITY
Chapter 2
FINANCIAL PLANNING PRACTICE

STANDARDS
Appendix I
LIST OF RELEVANT LAWS AND

REGULATIONS
Appendix II
FREQUENTLY ASKED QUESTIONS
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CHAPTER 1
Code of Ethics and Professional Responsibility
Section I
Section 1.1 Preamble and Applicability
Section 1.2 Composition and Scope
Section 1.3 Compliance
Section II
Part I
Principle : Introduction
Principle 1
Integrity
Principle 2
Objectivity
Principle 3
Competence
Principle 4
Fairness
Principle 5
Confidentiality
Principle 6
Professionalism
Principle 7
Diligence
Part II
Rules : Introduction
Rules that Relate to the Principle of

Integrity
Rule 101
Communication and Advertisement
Rule 102
No Misleading Statement
Rule 103
Funds and/or Other Property of Client

Objectivity
Rule 201
Professional Judgement
Rule 202
Act In the Interest of Client
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Competence
Rule 301
Keep Informed of Developments
Rule 302
Offer Service in Area of Competence

Fairness
Rule 401
Relevant
Material
Relationship Disclosure
Rule 402
Written Disclosure
Rule 403
Disclosure Prior to Establishment of

Client Relationships
Rule 404
Disclosure of Conflict of Interest
Rule 405
Annual Sources of Compensation

Disclosure
Rule 406
Fair and Reasonable Compensation
Rule 407
Disclosures of References
Rule 408
Agent For Principal
Rule 409
Agent For An Organization or Self

Employed
Rule 410
CFP Certificant As An Employee
Rule 411
Advise Outside Affiliations
Rule 412
Business Partnership
Rule 413
Partnership On Mutual Disclosure
Rule 414
Election to Withdraw
Rule 415
Fair Business Transaction with A

Client
Rule 416
Disclosure of Other Compensation or

Benefit Arrangement
Professional
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Rule 417
Disclosure Requirement On Services

That Do Not Encompass Financial
Planning
Rule 418
Disclosure Requirement On Changes

In Circumstances
Rule 419
Disclosure
Requirement
Contingency Fee

Confidentiality
Rule 501
No Disclosure of Client Relationship
Rule 502
Same Standard of Confidentiality To

Employers and Clients
Rule 503
Reasonable
Confidentiality
Partnership
Rule 504
Non Disclosure of Clients Name

Without Consent

Professionalism
Rule 601
Usage Of CFP Certification Mark
Rule 602
Fair And Honorable Competition
Rule 603
Prompt Notification To FPAM On

Violation of Code
Rule 604
Prompt Notification To Appropriate

Regulatory
and/or
Professional
Disciplinary Body On Unprofessional,
Fraudulent or Illegal Conduct
Rule 605
Alert
Appropriate
Authority
Suspicious Illegal Conduct
Rule 606
Performance
of
Services
In
Accordance to Applicable Law, Rules
and Regulations
On
Expectation
of
In A
Business
on
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Rule 607
Not Engage in Conduct Adverse to

Integrity
Rule 608
Disclosure as Registered Investment

Advisers (Financial Planning)
Rule 609
Practise Only In Licensed Field
Rule 610
Return Clients Original Records In A

Timely Manner
Rule 611
Not To Harass, Maliciously Injure,

Embarrass And /Or Unfairly Burden
Another
Rule 612
Commitment To Post Certification

Requirement and Payment Of Annual
CFP Fee
Rule 613
Borrowing
Rule 614
Lending

Diligence
Rule 701
Service Diligently
Rule 702
Engagement Only
Sufficient Information
Rule 703
Implement
Only
Recommendations
Rule 704
Consistent with Nature and Scope of

Engagement
Rule 705
Proper Supervision
On
Securing
Suitable
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CHAPTER 1
Code of Ethics and Professional Responsibility

Section I
Section
1.1
Preamble and Applicability

The Code has been adopted by FPAM to provide principles and
rules to all persons whom it has been recognized and certified to
use the CFP certification marks, (collectively "the marks"). FPAM
determines who is recognized and certified to use the marks.
Implicit in the acceptance of this authorization is an obligation not
only to comply with the mandates and requirements of all applicable
laws and regulations but also to take responsibility to act in an
ethical and professionally responsible manner in all professional
services and activities.
For purposes of this Code, a person recognized and certified by
FPAM to use the marks is called a CFP Certificant or Certified
Financial Planner. This Code applies to all CFP Certificants who are
entitled to use the CFP marks in the performance of their
professional responsibilities. This Code also applies to candidates
for the CFP Certificant who are registered as such with FPAM. For
purposes of this Code, the term CFP Certificant shall be deemed to
include candidates.
Section
1.2
Composition and Scope

The Code consists of two parts: Part I - Principles and Part II Rules.
The Principles are statements expressing in general terms the
ethical and professional ideals expected of CFP Certificants and
which they should strive to display in their professional activities.
The comments following each Principle further explain the meaning
of the Principle.
The Rules provide practical guidelines derived from the tenets
embodied in the Principles. As such, the Rules set forth the
standards of ethical and professionally responsible conduct
expected to be followed in particular situations.
This Code does not undertake to define standards of professional
conduct of CFP Certificants for purposes of civil liability but it set out
the Code of Ethics, which deals with behaviours that a CFP
Certificant must adhere to daily, and professional responsibilities of
CFP Certificants which if breached, are enforceable by FPAM and it
shall subject the CFP Certificants to disciplinary proceedings
pursuant to Section II of this Manual.
Due to the nature of a CFP Certificant's particular field of endeavor,
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certain Rules may not be applicable to that CFP Certificant's

activities. For example, a CFP Certificant who is engaged solely in
the sale of securities as a registered representative is not subject to
the written disclosure requirements of Rule 402 (applicable to CFP
Certificants engaged in Personal Financial Planning) although he or
she may have disclosure responsibilities under Rule 401. A CFP
Certificant is obligated to determine what responsibilities the CFP
Certificant has in each professional relationship including, for
example, duties that arise in particular circumstances from a
position of trust or confidence that a CFP Certificant may have. The
CFP Certificant is obligated to meet those responsibilities.
The Code is structured in a way that the presentation of the Rules
parallels the presentation of the Principles. For example, the Rules
which relate to Principle 1-Integrity, are numbered in the 100 to 199
series while those Rules relating to Principle 2-Objectivity, are
numbered in the 200 to 299 series.
Section
1.3
Compliance
FPAM requires adherence to this Code by all those it recognizes
and certifies to use the Marks. Compliance with the Code,
individually and by the profession as a whole, depends on each
CFP Certificant's knowledge of and voluntary compliance with the
Principles and applicable Rules, on the influence of fellow
professionals and public opinion, and on disciplinary proceedings,
when necessary, involving CFP Certificants who fail to comply with
the applicable provisions of the Code. Therefore, compliance with
the Code and the rules and regulations set out in other areas of the
Manual itself is indeed individually and collectively the CFP
Certificants professional responsibility.
Section II
Part I
Principle : Introduction
These Principles of the Code express the profession's recognition
of its responsibilities to the public, to Clients, to colleagues, and to
employers. They apply to all CFP Certificants and provide guidance
to them in the performance of their professional services.
These Principles of the Code constitute ethical behaviour and is
vital to a Financial Planning practice. Recognising, valuing and
applying the principles day to day is fundamental to professional
life.
These Principles of the Code sets out a limited number of key
ethical principles that apply broadly to all aspects of the Financial
Planning profession. Ethical behaviour presumes and goes beyond
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compliance with applicable rules and regulations.

Principle Integrity
1
A CFP Certificant shall offer and provide professional services with
integrity (the quality of conduct is according to the rules and
standard of the profession). As discussed in Composition and
Scope hereof, CFP Certificants may be placed by Clients in
positions of trust and confidence, as a result of which a CFP
Certificant stands in fiduciary relationship to the Client as such. The
ultimate source of such public trust is the CFP Certificant's personal
integrity. In deciding what is right and just, a CFP Certificant should
rely on his or her integrity as the appropriate touchstone. Integrity
demands honesty and candor which must not be subordinated to
personal gain and advantage. Within the characteristic of integrity,
allowance can be made for innocent error and legitimate difference
of opinion; but integrity cannot co-exist with deceit or subordination
of one's principles. Integrity requires a CFP Certificant to observe
the spirit of this Code and all relevant laws and regulation
regulating the profession. A CFP Certificant with integrity shall
always be accountable, and committed to acting competently,
responsibly, reliably, fairly and with respect in its professional
relationship with others.
Principle Objectivity
2
A CFP Certificant shall be objective in providing Financial Planning
services to Clients. Objectivity requires intellectual honesty,
impartiality and is the ability to make decisions based on facts
rather than on a CFP Certificants own personal feelings or beliefs.
It is an essential quality for any professional. Regardless of the
particular service rendered or the capacity in which a CFP
Certificant functions, a CFP Certificant should protect the integrity
of his or her work, maintain objectivity, and avoid subordination of
his or her judgment that would be in violation of this Code.
Objectivity requires a CFP Certificant to adopt international best
practice approach acceptable to international council standard
endorsed in this Code to convey information, advice and solution
recommendations in an understandable, effective and constructive
manner to fit the Clients situation and circumstances.
Principle Competence
3
A CFP Certificant shall provide Financial Planning services to
Clients competently and maintain the necessary knowledge and skill
to continue to do so in those areas in which the CFP Certificant is
engaged. One is competent only when he or she has attained and
maintained an adequate level of knowledge, skill, and applies that
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knowledge satisfactory and effectively in providing services to

Clients. Competence also includes the wisdom to recognize the
limitations of that knowledge and when consultation or Client referral
is appropriate.
A CFP Certificant, by virtue of having earned the CFP designation,
is deemed to be qualified to practice Financial Planning. However,
in addition to assimilating the common body of knowledge required
and acquiring the necessary experience for designation, a CFP
Certificant shall make a continuing commitment to learning and
professional improvement.
Competence requires a CFP Certificant to have broad knowledge of
the Financial Planning practice Rules and regulations that apply to
those area which the CFP Certificant is engaged and shall abide by
the aforesaid applicable rules and regulations to which they are
subject, including those of any professional bodies or regulators.
Principle Fairness
4
A CFP Certificant shall perform Financial Planning professional
services in a manner that is fair and reasonable to Clients,
principals, partners, and employers and shall disclose conflict(s) of
interest(s) in providing such services. The principle of fairness is to
prevent a CFP Certificant from abusing his position and acting in
his own interest at the expense of the persons whom he is
expected to act on behalf of.
Fairness requires impartiality, intellectual honesty, and disclosure
of conflict(s) of interest(s). It involves a subordination of one's own
feelings, prejudices, and desires so as to achieve a proper balance
of conflicting interests. Fairness is treating others in the same
fashion that you would want to be treated and is an essential trait
of any professional.
Fairness imputes an intention to fulfill an obligation. The doctrines
of performance and satisfaction are founded on this principle.
Fairness will not assist a CFP Certificant who failed to perform his
contractual services to Clients, principals, partners and employers
within a reasonable time.
Principle Confidentiality
5
A CFP Certificant shall not disclose any confidential Client
information without the specific consent of the Client unless in
response to proper legal process, to defend against charges of
wrongdoing by the CFP Certificant or in connection with a civil
dispute between the CFP Certificant and Client.
A Client, by seeking the services of a CFP Certificant, may be
interested in creating a relationship of personal trust and
confidence with the CFP Certificant. This type of relationship can
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only be built upon the understanding that information supplied to

the CFP Certificant or other information will be confidential. In
order to provide the contemplated services effectively and to
protect the Client's privacy, the CFP Certificant shall safeguard the
confidentiality of such information.
In a nutshell, a CFP Certificant shall safeguard the confidentiality
of any information received, unless subject to regulatory and/or
legal obligation. This principle prevents a CFP Certificant from
gaining personal advantages at the expense of the Client.
Principle Professionalism
6
A CFP Certificant's conduct in all matters shall reflect credit upon
the profession.
Because of the importance of the professional services rendered by
CFP Certificants, there are attendant responsibilities to behave with
dignity and courtesy to all those who use those services, fellow
professionals, and those in related professions. A CFP Certificant
also has an obligation to cooperate with fellow CFP Certificants to
enhance and maintain the profession's public image and to work
jointly with other CFP Certificants to improve the quality of services.
It is only through the combined efforts of all CFP Certificants in
cooperation with other professionals, that this vision can be
realized.
Professionalism requires a CFP Certificant to be skillful and render
quality services that adopt international standards of professional
good practice acceptable to international council standards as
endorsed in this Code.
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Principle Diligence
7
A CFP Certificant shall act diligently in providing Financial Planning
professional services.
Diligence is the provision of services in a reasonably prompt and
thorough manner, that require comprehensive and probing review
and inquiry which a prudent person will conduct in accordance with
general accepted practices of his vocation, in the case of a CFP
Certificant in accordance to an acceptable standard of good
practice endorsed by this Code.
Diligence also includes proper planning for and supervision of the
rendering of professional services. Diligence requires a CFP
Certificant to conduct their professional activities with due skill, care
diligence and competence. Diligence imputes an obligation to
obtain and make sound enquiries from Clients, to enable a CFP
Certificant to conduct a comprehensive study and analysis of
truthful, accurate and complete information submitted for services
or advice engaged for. The extent of due diligence required in any
given situation is essentially a question of facts which will depend
upon the circumstances surrounding each particular case.
Part II
Rules : Introduction
As stated in Part I-Principles, the Principles apply to all CFP
Certificants. However, due to the nature of a CFP Certificant's
particular field of endeavor, certain Rules may not be applicable to
that CFP Certificant's activities. The universe of activities by CFP
Certificants is indeed diverse and a particular CFP Certificant may
be performing all, some or none of the typical services provided by
Financial Planning Professionals. As a result, in considering the
Rules in Part II, a CFP Certificant must first recognize what specific
services he or she is rendering and then determine whether or not
a specific Rule is applicable to those services.
Rules that Relate to the Principle of Integrity
Rule 101 Communication and Advertisement

A CFP Certificant shall not solicit Clients through false or
misleading communications or advertisements:
(a) Misleading Advertising: A CFP Certificant shall not make a
false or misleading communication about the size, scope or areas
of competence of the CFP Certificant's practice or of any
organization with which the CFP Certificant is associated; and
(b) Promotional Activities: In promotional activities, a CFP
Certificant shall not make materially false or misleading
communications to the public or create unjustified expectations
regarding matters relating to Financial Planning or the professional
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activities and competence of the CFP Certificant. The term

"Promotional Activities" includes, but is not limited to, speeches,
interviews, books, printed or electronic publications, seminars,
radio and television shows, and video cassettes, compact discs,
vcds, dvds and etc;
(c) Representation of Authority: A CFP Certificant shall not give
the impression that a CFP Certificant is representing the views of
FPAM or any other group unless the CFP Certificant has been
authorized to do so. Personal opinions shall be clearly identified as
such.
Rule 102 No Misleading Statement
A CFP Certificant shall not engage in conduct involving
dishonesty, fraud, deceit or misrepresentation, or knowingly make
a false or misleading statement to a Client, employer, employee,
professional colleague, governmental or other regulatory body or
official, or any other person or entity.
Rule 103 Funds and/or Other Property of Client
A CFP Certificant has the following responsibilities regarding funds
and/or other property of Clients:
(a) In exercising custody of or discretionary authority over Client
funds or other property, a CFP Certificant shall act only in
accordance with the authority set forth in the governing legal
instrument (e.g., special power of attorney, trust, letters
testamentary, etc.);
(b) A CFP Certificant shall identify and keep complete records of
all funds or other property of a Client in the custody of or under the
discretionary authority of the CFP Certificant;
(c) Upon receiving funds or other property of a Client, a CFP
Certificant shall promptly or as otherwise permitted by law or
provided by agreement with the Client, deliver to the Client or third
party any funds or other property which the Client or third party is
entitled to receive and, upon request by the Client, render a full
accounting regarding such funds or other property;
(d) A CFP Certificant shall not commingle Client funds or other
property with a CFP Certificant's personal funds and/or other
property or the funds and/or other property of a CFP Certificant's
firm. Commingling one or more Client's funds or other property
together is permitted, subject to compliance with applicable legal
requirements and provided accurate records are maintained for
each Client's funds or other property;
(e) A CFP Certificant who takes custody of all or any part of a
Client's assets for investment purposes, shall do so with the care
required of a fiduciary.
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(f) A CFP Certificant shall not take custody of a Clients property

without entering into a binding written agreement to treat that
property with care of a fiduciary unless a binding, written armslength agreement between the parties specifies a different legal
standard applicable to custody of the Clients assets.
(g) To clearly indentify which, if any, of the Clients assets are
subject to the agreement between the CFP Certificant and the
Client, and clearly identify which, if any, of these assets the CFP
Certificant will take custody and/or exercise investment discretion
or supervision;
(h) To return Clients property, including personal records, to the
Client upon request and as soon as reasonably practicable, or
consistent with a different time frame specified in an agreement
between the parties.
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Rules that Relate to the Principle of Objectivity
Rule 201 Professional Judgement

A CFP Certificant shall exercise reasonable and prudent
professional judgment in providing Financial Planning services.
Rule 202 Act In the Interest of Client
A Financial Planning Practitioner shall act in the interest of the
Client.
3
Rules that Relate to the Principle of Competence
Rule 301 Keep Informed of Developments

A CFP Certificant shall keep informed of developments in the field
of Financial Planning and participate in continuing education
throughout the CFP Certificant's professional career in order to
improve professional competence in all areas in which the CFP
Certificant is engaged. As a distinct part of this requirement, a CFP
Certificant shall satisfy all minimum continuing education
requirements established for CFP Certificants by FPAM .
Rule 302 Offer Service in Area of Competence
A CFP Certificant shall offer advice only in those areas in which
the CFP Certificant has competence. In areas where the CFP
Certificant is not professionally competent, the CFP Certificant
shall seek the counsel of qualified individuals and/or refer Clients
to such parties.
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Rules that Relate to the Principle of Fairness
Rule 401 Relevant Material Professional Relationship Disclosure

In rendering professional services, a CFP Certificant shall disclose
to the Client:
(a) Material information relevant to the professional relationship,
including but not limited to conflict(s) of interest(s), changes in the
CFP Certificant's business affiliation, address, telephone number,
credentials, qualifications, licenses, compensation arrangement
and any agency relationships, and the scope of the CFP
Certificant's authority in that capacity.
(b) The information required by all laws applicable to the
relationship in a manner complying with such laws.
Rule 402 Written Disclosure
A Financial Planning Practitioner shall make timely written
disclosure of all material information relative to the professional
relationship. In all circumstances such disclosure shall include
conflict(s) of interest(s) and sources of compensation. Written
disclosures that include the following information are considered to
be in compliance with this Rule:
(a) A statement of the basic philosophy of the CFP Certificant (or
firm) in working with Clients. The disclosure shall include the
philosophy, theory and/or principles of Financial Planning which will
be utilized by the CFP Certificant;
(b) Resumes of principals and employees of a firm who are
expected to provide Financial Planning services to the Client and a
description of those services. Such disclosures shall include
educational
background,
professional/employment
history,
professional designations and licenses held, and areas of
competence and specialization;
(c) A statement of compensation, which in reasonable detail
discloses the source(s) and any contingencies or other aspects
material to the fee and/or commission arrangement. Any estimates
made shall be clearly identified as such and shall be based on
reasonable assumptions. Referral fees, if any, shall be fully
disclosed;
(d) A statement indicating whether the CFP Certificant's
compensation arrangements involve fee-only, commission-only, or
fee and commission. A CFP Certificant shall not hold out as a feeonly Financial Planning Practitioner if the CFP Certificant receives
commissions or other forms of economic benefit from related
parties;
(e) A statement describing material agency or employment
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relationships a CFP Certificant (or firm) has with third parties and
the fees or commissions resulting from such relationships;
(f) A statement identifying conflict(s) of interest(s);
where financial products are used in implementing the planning
strategy, the Client must be informed of the basis upon which the
CFP Certificant is compensated; To this end, the CFP Certificant
is governed by accepted sales disclosure guidelines and
regulations covering securities, mutual funds, real estate,
insurance and other financial products utilized in fulfilling the plan;
(g) The information required by all laws and regulations applicable
to the relationship in a manner complying with such.
Rule 403 Disclosure Prior to Establishment of Client Relationships
A CFP Certificant providing Financial Planning shall disclose in
writing, prior to establishing a Client relationship, relationships which
reasonably may compromise the CFP Certificant's objectivity or
independence.
Rule 404 Disclosure of Conflict of Interest
Should conflict(s) of interest(s) develop after a professional
relationship has commenced, but before the services contemplated
by that relationship have completed, a CFP Certificant shall
promptly disclose the conflict(s) of interest(s) to the Client or other
necessary persons.
Rule 405 Annual Sources of Compensation Disclosure
In addition to the disclosure by Financial Planning Practitioners
regarding sources of compensation required under Rule 402, such
disclosure shall be made annually thereafter for ongoing Clients.
The annual disclosure requirement may be satisfied by offering to
provide Clients with the disclosure called for by Rule 402.
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Rule 406 Fair and Reasonable Compensation

A CFP Certificant's compensation shall be fair and reasonable
having regard to all the circumstances of the case of the Client, and
in particular the following circumstances:(a) the time expended and time frame to complete the Clients
case;
(b) the skill, practical experience, credential, labour, specialized
knowledge and responsibility involved on the part of the CFP
Certificant;
(c) the complexity of the matter or the difficulty or novelty of the
question raised or both;
(d) the amount or value of money or property involved;
(e) the number and importance of the documents prepared or
perused without regard to length;
(f) the place and circumstances under which the services or
business or any part thereof are rendered or transacted.
Rule 407 Disclosures of References
Prior to establishing a Client relationship, and consistent with the
confidentiality requirements of Rule 501, a CFP Certificant may
provide references which may include recommendations from
present and/or former Clients.
Rule 408 Agent For Principal
When acting as an agent for a principal, a CFP Certificant shall
assure that the scope of his or her authority is clearly defined and
properly documented.
Rule 409 Agent For An Organization or Self Employed
Whether a CFP Certificant is employed by a Financial Planning
firm, or an investment institution, or serves as an agent for such an
organization, or is self-employed, all CFP Certificants shall adhere
to the same standards of disclosure and service of the said
organization or firm.
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Rule 410 CFP Certificant As An Employee

A CFP Certificant who is an employee shall perform professional
services with dedication to the lawful objectives of the employer
and in accordance with this Code and all laws of Malaysia.
Rule 411 Advice Outside Affiliations
A CFP Certificant shall:
(a) Advise the CFP Certificant's employer of outside affiliations
which reasonably may compromise service to an employer; and
(b) Provide timely notice to the employer and Clients, unless
precluded by contractual obligation, in the event of change of
employment or FPAM licensing status.
Rule 412 Business Partnership
A CFP Certificant doing business as a partner or principal of a
financial services firm owes to the CFP Certificant's partners or coowners a responsibility to act in good faith. This includes, but is not
limited to, disclosure of relevant and material financial information
while in business together.
Rule 413 Partnership On Mutual Disclosure
A CFP Certificant shall join a Financial Planning firm as a partner
or principal only on the basis of mutual disclosure of relevant and
material
information
regarding
credentials,
competence,
experience, licensing and/or legal status, and financial stability of
the parties involved.
Rule 414 Election to Withdraw
A CFP Certificant who is a partner or co-owner of a financial
services firm who elects to withdraw from the firm shall do so in
compliance with any applicable agreement, and shall deal with his
or her business interest in a fair and equitable manner.
Rule 415 Fair Business Transaction with A Client
A CFP Certificant shall inform his or her employer, partners or coowners of compensation or other benefit arrangements in
connection with his or her services to Clients which are in addition
to compensation from the employer, partners or co-owners for such
services.
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Rule 416 Disclosure of Other Compensation or Benefit Arrangement

If a CFP Certificant enters into a business transaction with a Client,
the transaction shall be on terms which are fair and reasonable to
the Client and the CFP Certificant shall disclose the risks of the
transaction, conflict(s) of interest(s) of the CFP Certificant, and
other relevant information, if any, necessary to make the
transaction fair to the Client
Rule 417 Disclosure Requirement On Services That Do Not Encompass
Financial Planning
When rendering services (such as taking an order for securities or
insurance coverage) that do not encompass Financial Planning,
CFP Certificant shall inform the Client of the scope of the services
that shall be rendered and that the CFP Certificant is not taking on
the responsibilities of a Financial Planning Practitioner.
Rule 418 Disclosure Requirement On Changes In Circumstances
A CFP Certificant shall inform the Client of any changes in
circumstances and material information that may arise subsequent
to the original engagement that may have an impact on the
professional relationship or services to be rendered. Such changes
include, but is not limited to:(a) conflict of interests;
(b) CFP Certificants business affiliation(s);
(c) compensation arrangement affecting the professional services to
be rendered; and
(d) new or changed agency relationships;
Rule 419 Disclosure Requirement On Contingency Fee
Where Financial Planning is to be compensated for on a
contingency fee basis, such a fee arrangement must be disclosed in
writing to the Client.
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Rules that Relate to the Principle of Confidentiality
Rule 501 No Disclosure of Client Relationship

A CFP Certificant shall not reveal or use for his or her own benefit
without the Client's consent, any personally identifiable information
relating to the Client relationship or the affairs of the Client, except
and to the extent disclosure or use is reasonably necessary:
(a) To establish an advisory or brokerage account, to effect a
transaction for the Client, or as otherwise impliedly authorized in
order to carry out the Client engagement; or
(b) To comply with legal requirements or legal process; or
(c) To defend the CFP Certificant against charges of wrongdoing;
or
(d) In connection with a civil dispute between the CFP Certificant
and the Client.
For purposes of this Rule, the proscribed use of Client information
is improper whether or not it actually causes harm to the Client.
Rule 502 Same Standard of Confidentiality To Employers and Clients
A CFP Certificant shall maintain the same standards of
confidentiality to employers and as to Clients.
Rule 503 Reasonable Expectation of Confidentiality In A Business
Partnership
A CFP Certificant doing business as a partner or principal of a
financial services firm owes to the CFP Certificant's partners or coowners a responsibility to act in good faith. This includes, but is not
limited to, adherence to reasonable expectations of confidentiality
both while in business together and thereafter.
Rule 504
Non Disclosure of Clients Name Without Consent

Save and except in compliance of Rule 501, a Clients name shall
not be disclosed to another party unless specific consent has been
granted for the use of the Client as a reference.
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Rules that Relate to the Principle of Professionalism
Rule 601 Usage Of CFP Certification Mark

A CFP Certificant shall use the marks in compliance with the rules
and regulations of FPAM , as established and amended from time
to time.
Rule 602 Fair And Honorable Competition
A CFP Certificant shall show respect for other Financial Planning
professionals, and related occupational groups, by engaging in fair
and honorable competitive practices. Collegiality among CFP
Certificants shall not, however, impede enforcement of this Code.
Rule 603 Prompt Notification To FPAM On Violation of Code
A CFP Certificant who has knowledge, which is not required to be
kept confidential under this Code, that another CFP Certificant has
committed a violation of this Code which raises substantial
questions as to the CFP Certificant's honesty, trustworthiness or
fitness as a CFP Certificant in other respects, shall promptly inform
FPAM. This Rule does not require disclosure of information or
reporting based on knowledge gained as a consultant or expert
witness in anticipation of or related to litigation or other dispute
resolution mechanisms. For purposes of this Rule, knowledge
means no substantial doubt.
Rule 604 Prompt Notification To Appropriate Regulatory and/or
Professional Disciplinary Body On Unprofessional, Fraudulent
or Illegal Conduct
A CFP Certificant who has knowledge, which is not required under
this Code to be kept confidential, and which raises a substantial
question of unprofessional, fraudulent or illegal conduct by a CFP
Certificant or other financial professional, shall promptly inform the
appropriate regulatory and/or professional disciplinary body. This
Rule does not require disclosure or reporting of information gained
as a consultant or expert witness in anticipation of or related to
litigation or other dispute resolution mechanisms. For purposes of
this Rule, knowledge means no substantial doubt.
Rule 605 Alert Appropriate Authority on Suspicious Illegal Conduct
A CFP Certificant who has reason to suspect illegal conduct within
the CFP Certificant's organization shall make timely disclosure of
the available evidence to the CFP Certificant's immediate
supervisor and/or partners or co-owners. If the CFP Certificant is
convinced that illegal conduct exists within the CFP Certificant's
organization, and that appropriate measures are not taken to
remedy the situation, the CFP Certificant shall, where appropriate,
20
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alert the appropriate regulatory authorities including FPAM in a

timely manner.
Rule 606 Performance of Services In Accordance to Applicable Law,
Rules and Regulations
In all professional activities a CFP Certificant shall perform services
in accordance with:
(a) Applicable laws, Rules, and regulations of governmental
agencies and other applicable authorities; and
(b) Applicable Rules, regulations, and other established policies of
FPAM .
Rule 607 Not Engage in Conduct Adverse to Integrity
A CFP Certificant shall not engage in any conduct which reflects
adversely on his or her integrity or fitness as a CFP Certificant,
upon the marks, or upon the profession.
Rule 608 Disclosure as Capital Markets Services Licence (Financial
Planning) Holders
The Capital Markets Services Act, 2007 requires registration of
Financial Planners with the Securities Commission. CFP
Certificants shall disclose to Clients their status as Capital
Markets Services Licence (Financial Planning) holders.
Rule 609 Practise Only In Licensed Field
A CFP Certificant shall not practice any other profession or offer to
provide such services unless the CFP Certificant is qualified to
practice in those fields and is licensed as required by law.
Rule 610 Return Clients Original Records In A Timely Manner
A CFP Certificant shall return the Client's original records in a
timely manner after their return has been requested by a Client.
Rule 611 Not To Harass, Maliciously Injure, Embarrass And /Or Unfairly
Burden Another
A CFP Certificant shall not bring or threaten to bring a disciplinary
proceeding under this Code or report or threaten to report
information to FPAM pursuant to Rules 603 and/or 604, or make or
threaten to make use of this Code for no substantial purpose other
than to harass, maliciously injure, embarrass and/or unfairly burden
another CFP Certificant.
21
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Rule 612 Commitment To Post Certification Requirement and Payment

Of Annual CFP Fee
A CFP Certificant shall comply with all applicable post-certification
requirements established by FPAM including, but not limited to,
payment of the annual CFP Certificant fee as well as signing and
returning the licensee's Statement annually in connection with the
license renewal process.
Rule 613 Borrowing
CFP Certificant must not borrow from a Client unless:(a)
The Client is a member of the CFP Certificants immediate family, or
(b)
The Client is an institution in the business of lending money and the

borrowing is unrelated to the financial services performed by the
CFP Certificant; or
(c)
Both parties to the written agreement are corporate entities, and the
agreement specifically permit such borrowing
Rule 614 Lending

CFP Certificant must not lend money to Client unless:(a)
The Client is a member of the CFP Certificants immediate family, or
(b)
The Client is an institution in the business of lending money and the

borrowing is unrelated to the financial services performed by the
CFP Certificant; or
(c)
Both parties to the written agreement are corporate entities, and the
agreement specifically permit such borrowing
Rules that Relate to the Principle of Diligence
Rule 701 Service Diligently

A CFP Certificant shall provide services diligently and on a timely
basis.
Rule 702 Engagement Only On Securing Sufficient Information

A Financial Planning Practitioner shall enter into an engagement
only after securing sufficient information to satisfy the CFP
Certificant that:
(a) The relationship is warranted by the individual's needs and
objectives; and
22
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(b) The CFP Certificant has the ability to either provide requisite
competent services or to involve other professionals who can
provide such services.
Rule 703 Implement Only Suitable Recommendations
A Financial Planning Practitioner shall make and/or implement
only recommendations which are suitable for the Client.
Rule 704 Consistent with Nature and Scope of Engagement
Consistent with the nature and scope of the engagement, a CFP
Certificant shall make a reasonable investigation regarding the
financial products recommended to Clients. Such an investigation
may be made by the CFP Certificant or by others provided the CFP
Certificant acts reasonably in relying upon such investigation.
Rule 705 Proper Supervision
A CFP Certificant shall properly supervise subordinates with regard
to their delivery of Financial Planning services, and shall not accept
or condone conduct in violation of this Code.
23
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CHAPTER 2
Financial Planning Practice Standards

Section I
1.1
Statement of Purpose for Practice

Standards
Practice Standards Defined
Section II
Personal
Process
100 series
Step 1 : Establishing and Defining

the Relationship with the Client
Defining the Scope, Nature and
Content of the Engagement
Explanation
Relationship to FPAMs Code of
Ethics
and
Professional
Responsibility
Anticipated Impact Upon the Public
Impact Upon the Financial Planning
Profession
Practitioner
Competency On Establishment of
Reasonable
Expectations
of
Client
Explanation
Ethics
and
Professional
Responsibility
Profession
Practitioner
100-1
100-1.1
100-1.2
100-1.3
100-1.4
100-1.5
100-2
100-2.1
100-2.2
100-2.3
100-2.4
100-2.5
200 series
200-1
200-1.1
200-1.2
200-1.3
200-1.5
Financial
Planning
Step 2 : Gathering Client Data

Determining a Clients Personal
and Financial Goals, Needs and
Priorities
Explanation
Ethics
and
Professional
Responsibility
Practitioner
24
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200-2
200-2.1
200-2.2
200-2.3
200-2.4
200-2.5
200-3
200-3.1
200-3.2
200-3.3
200-3.4
200-3.5
200-4
200-4.1
200-4.2
200-4.3
200-4.4
200-4.5
Obtaining
Quantitative
Information and Documents
Explanation
Ethics
and
Professional
Responsibility
Profession
Practitioner
Obtaining Non Financial Data and
Other
Relevant
Data
and
Information
Explanation
Ethics
and
Professional
Responsibility
Profession
Practitioner
Assemble
and
Consolidate
Relevant Data and Information
For Analysis
Explanation
Ethics
and
Professional
Responsibility
Profession
Practitioner
300 Series
Step 3 : Analyzing and Evaluating

the Clients Financial Status
300-1
Analyzing To Gain Understanding

Of Clients Financial Situation and
Evaluate to What Extent Clients
Goals, Needs and Priorities Can
Be Met
300-1.1
300-1.2
Explanation
Ethics
and
Professional
Responsibility
25
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300-1.3
300-1.4
300-1.5
300-2
300-2.1
300-2.2
300-2.3
300-2.4
300-2.5
400 Series
400-1
400-1.1
400-1.2
400-2
400-2.1
400-2.2
400-3
400-3.1
400-3.2

Profession
Practitioner
Time Line
Explanation
Relationship to the Code
Profession
Practitioner
Step 4
:
Developing
and
Presenting Financial Planning
Recommendations
Recommend
Alternative
Solutions
Explanation
Ethics
and
Professional
Responsibility
Develop
Selected
Alternative
Solutions
Explanation
Ethics
and
Professional
Responsibility
Communicate
the
Selected
Recommendations
Explanation
Ethics
and
Professional
Responsibility
500 Series
Step
5:
Implementing
the
Financial
Planning
Recommendations
500-1
Agreeing
On
Implementation
Responsibilities
Explanation
Ethics
and
Professional
500-1.1
500-1.2
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500-2
500-2.1
500-2.2
600 Series
600-1
600-1.1
600-1.2
Responsibility
Selecting Products and Services
For Implementation
Explanation
Ethics
and
Professional
Responsibility
Step 6 : Monitoring the Financial
Planning Recommendations
Defining
Monitoring
Responsibilities
Explanation
Ethics
and
Professional
Responsibility
27
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Chapter 2
Section I
Statement of Purpose for Practice Standards

Practice Standards are developed and promulgated by FPAM for
the practice of Personal Financial Planning. These standards:
(1) assure that the practice of Personal Financial Planning by the
CFP Certificant is based on agreed upon norms of practice;
(2) advance professionalism in Personal Financial Planning; and
(3) enhance the value of the Personal Financial Planning process.
1.1
Practice Standards Defined

Practice Standards establishes the level of professional practice that
is expected of CFP Certificants engaged in personal Financial
Planning. The services provided depend on the facts and
circumstances of a particular situation.
Practice Standards apply to Personal Financial Planning
Professionals, or to any CFP Certificants who represent or hold out
to Clients as practitioners in performing the tasks of personal
Financial Planning regardless of the person's title, job position, type
of employment, or method of compensation.
Practice Standards should be considered by all Personal Financial
Planning Professionals when performing the Financial Planning task
or activity addressed by the standard but are enforceable by FPAM
only against its CFP Certificants.
The standards are designed to provide CFP Certificants a structure
for identifying and implementing expectations regarding the
professional practice of Personal Financial Planning.
Practice Standards are not intended to prescribe step-by-step
procedures for providing any particular service. Such procedures
will be provided in practice guidelines that will be developed from
time to time.
28
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Section II
The Personal Financial Planning process is defined as follows:

Personal Financial Planning Process
Step 1
Step 2
Step 3
Step 4
Step 5
Step 6
Related Practice
Standard Series
Establishing and defining the relationship with

the client
Gathering Client data including goals
100
Analyzing and evaluating the client's

status
Developing and presenting financial
recommendations and/or alternatives
Implementing
the
financial
recommendations
Monitoring
the
financial
recommendations
financial
300
planning
400
planning
500
planning
600
200
Therefore the Financial Planning process shall include, but is not limited to the
aforesaid six steps that can be repeated throughout the Client and Financial
Planning Practitioner relationship. The Client can decide to end the process
before having completed all the steps. In providing Client with service of Personal
Financial Planning, the Financial Planning Practitioner shall use documented
procedures to respond to and resolve all Client complaints and claims, be
supported by financial, security, operational, risk management and business
continuation plans.
29
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100 series Step 1

Establishing and Defining the Relationship with the Client
100-1
Defining the Scope, Nature and Content of the Engagement
100-1.1
Explanation
Prior to providing any Financial Planning service, a Financial
Planning Practitioner and the Client shall mutually define the scope
nature and content of the engagement. The process of "MutuallyDefining" is essential in determining what activities may be
necessary to proceed with the Client engagement. This is
accomplished by:
(a) identifying the service(s) to be provided;
(b)disclosing Financial
arrangement(s);
Planning
Practitioner's
compensation
(c)determining the Client's and the Financial Planning Practitioner's

responsibilities;
(d) establishing the duration of the engagement; and
(e) providing any additional information necessary to define or limit
the scope.
The scope of the engagement may include one or more Financial
Planning subject areas. It is acceptable to mutually define
engagements in which the scope is limited to specific activities. This
serves to establish realistic expectations both for the Client and the
Practitioner.
To formalize the aforesaid engagement in order to reduce the salient
terms into a written agreement, the CFP Certificant and the Client
must discuss in depth, and consider as appropriate the following core
areas of Financial Planning, to define the extent or scope of
responsibilities intended by the parties to the agreement, which
include amongst others:(a) The obligations and responsibilities of each party under the
agreement with respect to:(i)
(ii)
(iii)
(iv)
(v)
(vi)
defining the Clients goals, needs and objectives;

gathering and providing appropriate Client data,
examining the result of the current course of action without any
changes;
the formulation of recommended actions,
implementation responsibilities, and
monitoring responsibilities
30
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(b) Compensation that any party to the agreement or any legal

affiliate to a party to the agreement will or could receive under the
terms of the agreement; and factors or terms that determine the
cost to the Client, how Client decisions benefit the CFP Certificant
and the relative benefit to the CFP Certificant;
(c) Terms under which the agreement permits the CFP Certificant to
offer the Client proprietary investment products;
(d) Terms under which the CFP Certificant will use other firms to
meet any of the agreements obligations;
(e) Whether the CFP Certificant will be held to the duty of care of a
fiduciary under the agreement.
A Financial Planning engagement exists when a Client signs a
binding written agreement or signs the acceptance letter of
engagement under which a CFP Certificant offer to perform some
type of financial service.
Therefore the Practice Standards does require the scope, nature and
content of the engagement to be in writing at the beginning of each
engagement and the Financial Planning Practitioner shall disclose
information in the written agreement or engagement letter which
includes but is not limited to:
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)
(ix)
(x)
their qualifications and experience;

disclosures pursuant to Rule 402 of the Manual;
the personal and contact details of the CFP licensee and the
client
service deliverables
basis of remuneration and compensation arrangement
information on any 3rd party product and service providers
and other professionals relevant to the financial planning
engagement.
any known conflicts of interest.
duration of the agreement
confidentiality provisions
handling of money
The Financial Planning Practitioner shall request and should gather

the following information which includes:(i)
personal information of Client and family
(ii)
short and long term financial goals
(iii)
consultants and professionals currently engaged
(iv)
employment details and status
(v)
financial information eg. assets, liabilities
(vi)
income and expenditure summary
31
____________________________________________________________________________
Methods for gathering the aforesaid information can include:(i)

personal interviews and meetings
(ii)
data gathering forms and questionnaires
(iii)
written correspondences
As the relationship proceeds, the scope may change by mutual
understanding and shall be documented in a written supplemental
agreement. This Practice Standard shall not be considered alone, but
in conjunction with all other Practice Standards.
100-1.2

This Practice Standard relates to the Code through:Principle 4-Fairness Rule 402;
Principle 7-Diligence Rule 702.
Principle 4 states that "a CFP Certificant shall perform Professional
services in a manner that is fair and reasonable to Clients.... Rule
402 in the Code of Ethics and Professional Responsibility requires a
Financial Planning Practitioner to make "timely written disclosure of
all material information relative to the professional relationship. In all
circumstances such disclosure shall include sources of
compensation".
Principle 7 states that "a CFP Certificant shall act diligently in
providing professional services. Rule 702 requires that Financial
Planning Practitioners enter into an engagement only after obtaining
sufficient information to satisfy that "the relationship is warranted by
the individual's needs and objectives; and the CFP Certificant has
the ability to either provide requisite competent services or to
involve other professionals who can provide such services.
100-1.3

The public is served when the relationship is based upon a mutual
understanding of the engagement. Clarity of the scope of the
engagement enhances the likelihood of achieving Client
expectations.
32
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100-1.4
Impact Upon the Financial Planning Profession

The Profession benefits when Clients are satisfied. This is more
likely to take place when Clients have expectations of the process,
which are both realistic and clear, before services are provided.
100-1.5
Impact Upon the Financial Planning Practitioner

A mutually defined scope of the engagement provides a framework
for the Financial Planning process by focusing both the Client and
the Practitioner on the agreed upon tasks. This enhances the
potential for positive results.
100-2
Competency On Establishment of Reasonable Expectations of

Client
100-2.1
Explanation
A Financial Planning Practitioner shall be able to assist a Client to
establish reasonable expectation of his Financial Plan based on the
mutually defined and agreed scope of the engagement. As such, a
Financial Practitioner shall understand the nature and the scope of
engagement and shall cause Client to understand by
communicating to the Client in a way that will assist the Client to
establish Clients reasonable expectations based on the scope of
the engagement that builds a fiduciary relationship between them.
At this stage the Financial Planning Practitioner shall use the
outputs from step 1 and shall request in additional, appropriate data
that should normally include but not limited to the following:
statement of assets and liabilities

statement of cash flows and budgets
insurance policies
investment certificates and contracts;
legal documents;
immediate and long term goals and objectives,
economic assumptions,
risk tolerance
other considerations like ethical or religious
It is a crucial obligation of the Financial Planning Practitioner to

protect the confidentiality of Client information;
It is good practice that the Financial Practitioner shall maintain an
electronic or hardcopy database of files and/or records for the
Client with relevant values and dates for the timeframe mandated
by local law, or in absence of local law, six years from the date of
the term of engagement or termination of the engagement,
33
____________________________________________________________________________
whichever later.
100-2.2

This Practice Standard relates to the Code through:Principle 2 Objectivity, Rule 202
Principle 3 Competence, Rule 302
Principle 2 states that "Objectivity requires a CFP Certificant to
adopt international best practice approach acceptable to
international council standard endorsed in this Code to convey
information, advice and solution recommendations in an
understandable, effective and constructive manner to fit the Clients
situation and circumstances...".Rule 202 in the Code of Ethics and
Professional Responsibility requires a Financial Planning
Practitioner to act in the interest of Client".
Principle 3 states that "A CFP Certificant shall provide services to
Clients competently and maintain the necessary knowledge and
skill to continue to do so in those areas in which the CFP Certificant
is engaged. Rule 302 requires that Financial Planning Practitioners
to offer advice only in those areas in which the CFP Certificant has
competence.
100-2.3

The public is served when the relationship is a fiduciary relationship
where a Financial Practitioner owes his Client a duty to establish
with clarity the scope of the engagement to achieve Clients
reasonable expectation.
100-2.4

The Financial Planning Practice builds trust and confidence on
Clients to engage Financial Planning Practitioner to render
Financial Planning advice.
100-2.5

The practice demands integrity and commitment of the CFP
Certificants at the onset of the mutually agreed scope of
engagement established.
34
____________________________________________________________________________
200 series
Step 2
Gathering Client Data
200-1
Determining a Clients Personal and Financial Goals, Needs

and Priorities
200-1.1
Explanation
A Client's personal and financial goals, needs and priorities that are
relevant to the scope of the engagement and the service(s) being
provided shall be mutually defined by the Financial Planning
Practitioner and the Client prior to making and/or implementing any
recommendations.
Prior to making recommendations to a Client, a Financial Planning
Practitioner and the Client shall mutually define the Client's personal
and financial goals, needs and priorities. In order to arrive at such a
definition, the Practitioner will need to explore the Client's values,
attitudes, expectations, and time horizons as they affect the Client's
goals, needs, and priorities.
The process of "mutually-defining" is essential in determining what
activities may be necessary to proceed with the Client engagement.
Clients personal values and attitudes shape a Client's goals and
objectives and the priority placed on them. Accordingly, these goals
and objectives must be consistent with the Client's values and
attitudes in order for the Client to make the commitment necessary
to accomplish them and shall form part of the written agreement
between the CFP Certificant and the Client.
Goals and objectives provide focus, purpose, vision, and direction
for the Financial Planning process. It is essential that objectives
relative to the scope of the engagement are determined and that
they are clear, precise, consistent, and measurable. The role of the
Practitioner is to facilitate the goal-setting process in order to clarify,
with the Client, goals and objectives, and, when appropriate, the
Practitioner must try to assist Clients in recognizing the implications
of unrealistic goals and objectives.
The Practice Standard addresses only the tasks of determining a
Client's personal and financial goals, needs and priorities; assessing
a Client's values, attitudes and expectations; and determining a
Client's time horizons. These areas are subjective and the
Practitioner's interpretation is limited by what the Client reveals. A
Practitioner performing the activity of "gathering Client data" should
consider together the various Practice Standards applicable to such
activity.
35
____________________________________________________________________________
This Practice Standard shall not be considered alone, but in

conjunction with all other Practice Standards.
In a nutshell a Financial Planning Practitioner shall understand the
need for establishing time horizons for Clients objectives, qualifying
and prioritizing needs and objectives based on established goal of
Clients, how certain events and stages within the life cycle could
have an impact on a Clients need. Therefore a Financial Planning
Practitioner shall be able to assist Client to identifying,
understanding and prioritizing Clients needs and objectives, time
horizon for each need and objectives, all of which shall be reduced
in written agreement to be executed between the CFP Certificant
and the Client.
200-1.2

This Practice Standard relates to the Code through:Principle 7 - Diligence, and Rules 701 to 703.
Rule 701 states that "a CFP Certificant shall provide services
diligently.
Rule 702 requires a Financial Planning Practitioner to "enter into an
engagement only after securing sufficient information to satisfy the
CFP Certificant that. the relationship is warranted by the individual's
needs and objectives....
In addition, Rule 703 requires a Financial Planning Practitioner to
"make and/or implement only recommendations which are suitable
for the Client.
200-1.3

The public is served when the relationship is based upon mutually
defined goals, needs, and priorities. Compliance with this Practice
Standard reinforces the practice of putting the Client's interest first
which is intended to increase the likelihood of achieving the Client's
goals and objectives.
200-1.4

Compliance with this Practice Standard emphasizes to the public
that the Client's goals, needs, and priorities are the focus of the
Financial Planning process. This encourages the public to seek
out the services of a Financial Planning Practitioner who uses
such an approach.
36
____________________________________________________________________________
200-1.5

The Client's goals, needs and priorities help determine the direction
of the Financial Planning process. This focuses the Financial
Planning Practitioner on the specific tasks that need to be
accomplished. Ultimately this will facilitate the development of
appropriate recommendations.
200-2
Obtaining Quantitative Information and Documents
200-2.1
Explanation
A Financial Planning Practitioner shall obtain sufficient and relevant
quantitative information and documents about a Client applicable to
the scope of the engagement and the services being provided prior
to making and/or implementing any recommendations.
Prior to making recommendations to a Client and depending upon
the type of Client engagement and its scope, a Financial Planning
Practitioner shall determine what quantitative information and
documents are sufficient and relevant.
A Financial Planning Practitioner shall obtain sufficient and relevant
quantitative information and documents pertaining to the Client's
financial resources, financial obligations, and financial personal
situation amongst others include past, current and expected
income, expenditure, assets and liabilities. This information may be
obtained directly from the Client or other sources through
interviews, questionnaires, Client records and documents all of
which form part of the written agreement to be executed between
the CFP Certificant and the Client.
A Financial Planning Practitioner shall communicate to the Client
followed by written agreement, a reliance on the completeness and
accuracy of the information provided and that incomplete or
inaccurate
information
will
impact
conclusions
and
recommendations.
If a Financial Planning Practitioner is unable to obtain sufficient and
relevant quantitative information and documents to form a basis for
recommendations, the Practitioner shall in the written agreement,
either:
(a) restrict the scope of the engagement to those matters for which
sufficient and relevant information is available; or
(b) terminate the engagement.
37
____________________________________________________________________________
A Financial Planning Practitioner shall communicate to the Client

followed by written agreement any limitations on the scope of the
engagement, as well as the fact that this limitation could affect the
conclusions and recommendations.
conjunction with all other practice standards.
In nutshell a Financial Planning Practitioner shall possess a broad
general knowledge of financial and economic concepts and basic
analytical abilities required to develop the mutually agreed financial
objectives. The Financial Planning Practitioner shall possess a
basic understanding of how risk and time frames Clients financial
objectives and be able to clearly state the objectives as developed
with and agreed to by Client.
200-2.2

This Practice Standard relates to the Code through Principle 7 Diligence, Rules 701 to 703.
diligently.
CFP Certificant that....the relationship is warranted by the
individual's needs and objectives....
for the Client.
200-2.3

The public is served when Financial Planning recommendations are
based upon sufficient and relevant quantitative information and
documents. This Practice Standard is intended to increase the
likelihood of achieving the Client's goals and objectives.
200-2.4

The Financial Planning process requires that recommendations be
made based on sufficient and relevant quantitative data. Therefore,
compliance with this Practice Standard encourages the public to
seek Financial Planning Practitioners who use the Financial
Planning process.
38
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200-2.5

Sufficient and relevant quantitative information and documents
provide the foundation for analysis. Ultimately, this will facilitate the
development of appropriate recommendations.
200-3
Obtaining Non Financial Data and Other Relevant Data and

Information
200-3.1
Explanation
A Financial Planning Practitioner shall also obtain sufficient and
relevant non financial data and other relevant information and
documents about a Client applicable to the scope of the
engagement and the services being provided prior to making and/or
implementing any recommendations, amongst others may include
where applicable, values, obligations, hopes, fears, preferences,
attitudes, risk profile, priorities of client. Financial objectives/special
needs, health, personal/family data, lifestyle/occupation, family
needs/priorities should also be considered.
This information may also be obtained directly from the Client or
other sources through interview, questionnaire, Client records and
documents.
A Financial Planning Practitioner shall communicate to the Client a
reliance on the completeness and accuracy of the information
provided and that incomplete or inaccurate information will impact
conclusions and recommendations.
If the Financial Planning Practitioner is unable to obtain sufficient
non financial data to form a basis for recommendations, the
Financial Practitioner shall either:
(a) restrict the scope of the engagement to those matters for which
sufficient and relevant information is available; or
(b) terminate the engagement.
The Financial Planning Practitioner shall communicate to the Client
any limitations on the scope of the engagement, as well as the fact
that this limitation could affect the conclusions and
recommendations.
conjunction with all other practice standards.
39
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200-3.2

This Practice Standard relates to the
Principle 7 - Diligence, Rules 701 to 703.
Code
through:-
diligently.
CFP Certificant that....the relationship is warranted by the
individual's needs and objectives....
for the Client.
200-3.3

The public is served when Financial Planning recommendations
are based upon sufficient and relevant qualitative non financial
information and documents. This Practice Standard is intended to
increase the likelihood of achieving the Client's goals and
objectives.
200-3.4

The Financial Planning process requires that recommendations be
made based on sufficient and relevant qualitative non financial data.
Therefore, compliance with this Practice Standard encourages the
public to seek Financial Planning Practitioners who use the
Financial Planning process.
200-3.5

Sufficient and relevant qualitative non financial information and
documents provide the foundation for analysis of financial data
gathered. Ultimately, this will facilitate the development of
appropriate recommendations that is specific, measurable,
attainable, realistic, and achievable within time frame
recommended.
40
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200-4
Assemble and Consolidate Relevant Data and Information For

Analysis
200-4.1
Explanation
Prior to analyzing and evaluating the Clients financial status, a
Financial Planning Practitioner shall assemble and consolidate all
the relevant data and information for analysis.
The process of "gathering and consolidation of relevant
information" is essential for a Financial Planning Practitioner in
determining how to identify gaps and discrepancies when
organizing the information gathered from the Client for analysis.
200-4.2

This Practice Standard relates to the Code through:Principle 3 - Competence Rules 302.
Rule 302 states that In areas where the CFP Certificant is not
professionally competent, the CFP Certificant shall seek the
counsel of qualified individuals and/or refer Clients to such parties
200-4.3

The public is served when a Financial Planning Practitioner possess
skill to use appropriate methods to gather and consolidate relevant
information to map out strategies to achieve the Client's goals and
objectives
200-4.4

Compliance with this Practice Standard promotes and enhances
professionalism.
200-4.5

The Client's relevant information and documents help determine
the direction of the Financial Planning process. This focuses the
Financial Planning Practitioner on the specific tasks that need to be
accomplished. Ultimately, this will facilitate the development of
appropriate recommendations.
41
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300 Series Step 3: Analyzing and Evaluating the Clients Financial Status
300-1
Analyzing To Gain Understanding of the Clients Financial

Situation and Evaluate to What Extent Clients Goals, Needs
and Priorities Can Be Met
300-1.1
Explanation
A Financial Planning Practitioner shall analyze the information to
gain an understanding of the Client's financial situation and then
evaluate to what extent the Client's goals, needs and priorities can
be met by the Client's resources and current course of action.
Prior to making recommendations to a Client, it is necessary for the
Financial Planning Practitioner to assess the Client's overall
financial position and to determine the likelihood of reaching the
stated objectives by continuing present activities.
A Financial Planning Practitioner shall be able to identify, analyse
and evaluate the following factors surrounding the Clients financial
status: The implications of a Clients current and projected net
worth and cash flow statements;
Relevant tax issues and related implications to the
Clients;
Economic, financial and social factors relevant to
Clients situation;
Clients risk management and insurance situation;
Clients retirement situation;
Clients estate;
Clients investment situation;
As such the Financial Planning Practitioner shall possess broad
general knowledge to enable him to analyse and evaluate
competently the above-mentioned areas of concern to address the
Clients goals, preferences and risk tolerance and should reflect
anticipated future changes.
In a nutshell a CFP Certificant shall understand the comprehensive
and integrated nature of financial planning and how various areas of
a Clients financial life interact.
Analysis and evaluation are critical to the Financial Planning
process. These activities form the foundation for determining
strengths and weaknesses of the Client's financial situation and
current course of action. These activities may also identify other
issues that should be addressed. As a result, it may be appropriate
to amend the scope of the engagement and/or to obtain additional
42
____________________________________________________________________________
information.
At this stage, the Financial Planning Practitioner shall produce and
provide the Client, in a clear and reasonable manner, an evaluation
of the Clients status that identifies areas of strengths and
vulnerability, comparing them against the Clients goals, plans,
restrictions and assessment of financial risk tolerance.
300-1.2

This Practice Standard relates to the Code through:Principle 2 - Objectivity, Rules 201 and 202;
Principle 3 - Competence, Rule 302;
Principle 7 - Diligence, Rule 701.
Principle 2 states that "A CFP Certificant shall be objective in
providing Professional services to Clients." Rule 201 states that "A
CFP Certificant shall exercise reasonable and prudent professional
judgment in providing Professional services." And Rule 202 states
that "A Financial Planning Practitioner shall act in the interest of the
Client."
Principle 3 states that a CFP Certificant shall provide services to
is engaged." Rule 302 states that "A CFP Certificant shall offer
advice only in those areas in which the CFP Certificant has
competence. In areas where the CFP Certificant is not
counsel of qualified individuals and/or refer Clients to such parties."
Under Principle 7, Rule 701 states that "A CFP Certificant shall
provide services diligently."
300-1.3

The public confidence and trust is served when a Financial
Planning Practitioner is competent and possesses skill to analyse
and evaluate the Clients financial status.
43
____________________________________________________________________________
300-1.4

Compliance with this Practice Standard is on par with international
standards of Professional good practice acceptable to international
council standard.
300-1.5

The process of analysis and evaluation of the Client's relevant
information and documents help determine the focus on the specific
tasks that need to be accomplished. Ultimately, this will facilitate the
Financial
Planning
Practitioner
to
develop
appropriate
recommendations for his Client.
300-2
Time Line
300-2.1
Explanation
A Financial Planning Practitioner shall be able to prepare a timeline
of Clients life events taking into account the Clients situation and
intentions as defined in the objectives.
As such the Financial Planning Practitioner shall possess a general
knowledge of significant events and circumstances in life that may
cause an individual to seek advice and an understanding of their
financial implication, the analytical skills necessary to prepare a time
line of a Clients life events and be able to integrate economic,
financial and social factors in preparing the timeline of events.
300-2.2

This Practice Standard relates to the Code through:Principle 2 - Objectivity, Rules 201 and 202;
Principle 3 - Competence, Rule 302;
Principle 7 - Diligence, Rule 701.
providing Professional services to Clients." Rule 201 states that "A
judgment in providing professional services." And Rule 202 states
that "A Financial Planning Practitioner shall act in the interest of the
Client."
Principle 3 states that a CFP Certificant shall provide services to
is engaged." Rule 302 states that "A CFP Certificant shall offer
advice only in those areas in which the CFP Certificant has
competence. In areas where the CFP Certificant is not
44
____________________________________________________________________________

counsel of qualified individuals and/or refer Clients to such parties."
300-2.3

The public confidence and trust is served when a Financial Planning
Practitioner is competent to be able to prepare a timeline of Clients
life events taking into account the Clients situation and intentions as
defined in the objectives.
300-2.4

Compliance with this Practice Standard is on par with international
standards of professional good practice acceptable to international
council standard.
300-2.5

The timeline prepared help a Financial Planning Practitioner to
focus on the specific tasks that need to be accomplished within time
frame reasonable expected by the Client.
400 Series Step 4: Developing

Recommendations
and
Presenting
400-1
Recommend Alternative Solutions
400-1.1
Explanation
Financial
Planning
The Financial Planning Practitioner shall consider sufficient and

relevant alternative solutions to the Clients current course of action
in an effort to achieve the Client's goals, needs and priorities.
After analyzing the Client's current financial situation (Practice
Standard 300-1) and prior to developing and presenting the
recommendation(s) (Practice Standards 400-2 and 400-3) the
Financial Planning Practitioner shall identify alternative solutions to
recommend to the Client. The Financial Planning Practitioner shall
evaluate the effectiveness of such solutions in reasonably achieving
the Client's goals, needs and priorities.
This evaluation may involve, but is not limited to, considering
multiple assumptions, conducting research, or consulting with other
professionals. The Financial Planning Practitioner will utilize the
Clients specified, mutually agreed upon, and/or other reasonable
assumptions. Both personal and economic assumptions must be
considered in this step of the process. These assumptions may
45
____________________________________________________________________________
include, but are not limited to the following:

personal assumptions, such as: retirement age(s), life
expectancy(ies), income needs, risk factors, time horizon,
and special needs and
economic assumptions, such as: inflation rates, tax rates and
investment returns.
This process may result in a single alternative solution, multiple
alternative solutions, or no alternative solution to resolve the Client's
current financial status.
In considering alternative solutions, the Financial Planning
Practitioner also must recognize and, if appropriate, take into
account his or her legal and/or regulatory limitations and level of
competency in properly addressing each of the Client's Financial
Planning issues. A Financial Planning Practitioner shall be able to
develop the following and present in a way that assists the Client in
understanding how these recommendations can meet the Clients
needs:
Clients statement of net worth

Clients statement of cash flow;
Clients tax planning strategies;
Clients risk management and insurance plans;
Clients retirement plans;
Clients investment plans
Clients estate planning strategies and recommendations
The Financial Planning Practitioner shall at this stage, make a

comparison of Clients tolerance for financial risks and the financial
risks that may be involved in achieving his goals. This involves the
ability to understand risks in financial implications and the Clients
financial risk tolerance of a Financial Planning Practitioner to assist
and explain to the Client how to resolve and reconcile any
differences thereof.
More than one alternative solution may reasonably achieve the
Client's goals, needs, and priorities. Alternatives solutions identified
by the Financial Planning Practitioner may differ from those of other
Financial Planning Practitioners or advisors, illustrating the
subjective nature of exercising professional judgment
Therefore the Financial Planning Practitioner shall understand the
comprehensive nature of Financial Planning and how various areas
of the Clients financial life interact to assist the Client in resolving
any differences.
The Financial Planning Practitioner shall review, discuss and
resolve with the Client, the following46
____________________________________________________________________________
Clients economic status and circumstances;

Clients long and short term goals and ability to achive
those goals
Clients tolerance of risks
Strategies and plans required to achieve the Clients goals.
The Financial Planning Practitioner shall also integrate various

Financial Planning components and explain the resulting
comprehensive Financial Planning plan to the Client in order to
obtain commitment from the Client to proceed.
This involves the Financial Planning Practitioner: Integrating various components into a logical and
appropriate financial plan for a Client;
Explaining the resulting comprehensive financial plan and
obtaining the commitment from the client to proceed;
Ensuring that the recommendations answer the questions of
who, what, when, where, why and how;
Evaluating alternative strategies and determining how the
recommendations could affect the overall Financial Planning
plan;
Evaluating a comprehensive Financial Planning plan to
determine if it meets the needs and stated objectives of a
Client;
Obtaining an agreement to the assumptions utilized.
400-1.2

This Practice Standard relates to the Code through:Principle 2 - Objectivity, Rules 201 and 202,
Principle 3 - Competence, Rule 302,
Principle 6 Professionalism, Rule 609
Principle 7 - Diligence, Rule 701 and 703.
providing professional services to Clients." Rule 201 states that "A
judgment in providing professional services." Rule 202 states that "a
Financial Planning Practitioner shall act in the interest of the Client."
Principle 3 states that a "CFP Certificant shall provide services to
engaged." Rule 302 states that "A CFP Certificant shall offer advice
only in those areas in which the CFP Certificant has competence. In
areas where the CFP Certificant is not professionally competent, the
CFP Certificant shall seek the counsel of qualified individuals and/or
refer Clients to such parties."
47
____________________________________________________________________________
Principle 6 states that "a CFP Certificant's conduct in all matters

shall reflect credit upon the profession." Rule 609 states that "a CFP
Certificant shall not practice any other profession or offer to provide
such services unless the CFP Certificant is qualified" and is licensed
as required by law."
Principle 7 states that "A CFP Certificant shall act diligently in
providing professional services." Rule 701 states that "A CFP
Certificant shall provide services diligently. Rule 703 states that "a
Financial
Planning
Practitioner
shall
implement
only
recommendations which are suitable for the Client."
400-2
Develop Selected Alternative Solutions
400-2.1
Explanation
The Financial Planning Practitioner shall assist the Client to select
recommendation(s) based on the alternative(s), the current course
of action plan, the statement of net worth and the statement of cash
flow in an effort to reasonably achieve the Client's goals, needs and
priorities, in accordance with the terms of engagement.
After identifying and evaluating the alternative(s) solutions and the
Client's current course of solution action plan, the Financial
Planning Practitioner shall develop the recommendation(s) expected
to reasonably achieve the Client's goals, needs and priorities. The
recommendation(s) may be an independent solution action plan or a
combination of solutions which may need to be implemented
collectively.
The recommendation(s) shall be consistent with and will be directly
affected by the following:
mutually defined scope of the engagement;
mutually defined Client goals, needs and priorities;
qualitative and quantitative data provided by the Client;
personal and economic assumptions;
Financial Planning Practitioner's analysis and evaluation of
Client's current situation; and
alternative solutions selected by the Financial Planning
Practitioner.
A recommendation may be to continue the current course of
solution action plan. If a change is recommended, it may be specific
and/or detailed or provide a general direction. In some instances, it
may be necessary for the Financial Planning Practitioner to
recommend that the Client modify a goal.
48
____________________________________________________________________________
The recommendations developed by the Financial Planning

Practitioner may differ from those of other Financial Planning
Practitioners or advisors yet each may reasonably achieve the
Client's goals, needs and priorities.
Therefore it is a good practice for a Financial Planning Practitioner
to produce appropriate documentation for each recommendation to
record evidence of acceptance, modification, completion, deferral or
rejections, pursuant to local and national requirements.
400-2.2

This Practice Standard relates to the Code through:Principle 2 - Objectivity, Rules 201 and 202,
Principle 3 - Competence, Rule 302,
Principle 6 Professionalism, Rule 609 and
Principle 7 - Diligence, Rule 701 and 703 and 704.
judgment in providing professional services." Rule 202 states that "a
Principle 3 states that a "CFP Certificant shall provide services to
Principle 6 states that "a CFP Certificant conduct in all matters shall
reflect credit upon the profession." Rule 609 states that "a CFP
Certificant shall not practice any other profession or offer to provide
such services unless the CFP Certificant is qualified' and is licensed
as required by law."
Principle 7 states that "A CFP Certificant shall act diligently in
providing professional services." Rule 701 states that "A CFP
Certificant shall provide services diligently. Rule 703 states that "a
Financial Planning Practitioner shall make implement only
recommendations which are suitable for the Client." Rule 704 states
that "a CFP Certificant shall make a reasonable investigation
regarding the financial products recommended to Clients. Such an
investigation may be made by the CFP Certificant or by others
provided the CFP Certificant acts reasonably in relying upon such
investigation".
49
____________________________________________________________________________
400-3
Communicate the Selected Recommendations
400-3.1
Explanation
The Financial Planning Practitioner shall communicate the
recommendation(s) in a manner and to an extent reasonably
necessary to assist the Client in making an informed decision.
When presenting a recommendation, the Financial Planning
Practitioner shall make a reasonable effort to assist the Client in
understanding the Client's current situation, the recommendation
itself, and its impact on the ability to achieve the Client's goals,
needs and priorities. In doing so, the Financial Planning Practitioner
shall avoid presenting the Financial Planning Practitioner's opinion
as fact.
The Financial Planning Practitioner shall communicate the factors
critical to the Client's understanding of the recommendations. These
factors may include but are not limited to material:
Personal and economic assumptions;
Interdependence of recommendations;
Advantages and disadvantages;
Risks; and/or
Time sensitivity.
The Financial Planning Practitioner should indicate that even though
the recommendations may achieve the Client's goals, needs and
priorities, changes in personal and economic conditions could alter
the intended outcome. Changes may include, but are not limited to:
legislative, family status, career, investment performance and/or
health.
If there are conflicts of interest that have not been previously
disclosed, such conflicts and how they may impact the
recommendations should be addressed at this time.
Presenting recommendations provides the Financial Planning
Practitioner an opportunity to further assess whether the
recommendations meet Clients expectations, whether the Client is
willing to act on the recommendations, and whether modifications
are necessary.
400-3.2

This Practice Standard relates to the Code through:Principle 1 Integrity, Rule 102,
Principle 2 Objectivity, Rule 201, and
Principle 6 Professionalism, Rule 607.
50
____________________________________________________________________________
Principle 1- Integrity states that a CFP Certificant shall offer and

provide professional services with integrity. Rule 102 states that 'a
CFP Certificant shall not knowingly make a false or misleading
statement to a Client"
judgment in providing professional services.
Principle 6 states that "a CFP Certificant conduct in all matters shall
reflect credit upon the profession. Rule 607 states that "a CFP
Certificant shall not engage in any conduct that reflects adversely on
his or her integrity or fitness as a CFP Certificant."
500 Series Step 5: Implementing the Financial Planning Recommendations
500-1
Agreeing On Implementation Responsibilities
500-1.1
Explanation
The Financial Planning Practitioner and the Client shall mutually
agree on the implementation responsibilities consistent with the
scope of the engagement.
The Client is responsible for accepting or rejecting
recommendations
and
for
retaining
and/or
delegating
implementation responsibilities. The Financial Planning Practitioner
and the Client shall mutually agree on the services, if any, to be
provided by the Financial Planning Practitioner. The scope of the
engagement, as originally defined, may need to be modified
The Financial Planning Practitioners responsibilities may include,
but are not limited to the following:
identifying activities necessary for implementation;
determining division of activities between the Financial
Planning Practitioner and the Client;
referring to other professionals;
coordinating with other professionals;
sharing of information as authorized; and
selecting and securing products and/or services.
If there are conflicts of interest, sources of compensation or material
relationships with other professionals or advisors that have not been
previously disclosed, such conflicts, sources or relationships must
be disclosed at this time.
51
____________________________________________________________________________
When referring the Client to other Professionals or advisors, the

Financial Planning Practitioner shall indicate the basis for the
referral.
If the Financial Planning Practitioner is engaged by the Client to
provide only implementation activities, the scope of the engagement
shall be mutually defined in writing, in accordance with Practice
Standard 100-1. This scope may include such matters as the extent
to which the practitioner will rely on information, analysis or
recommendations provided by others.
A Financial Planning Practitioner shall at this stage be able to
prepare documentation that summarizes the objectives,
implementation strategies as agreed with the Client, to
communicate coordinate and reconcile the agreed solution with the
Client, to carry out the agreed implementation strategies with the
Client.
A Financial Planning Practitioner shall be able to review the financial
plan with the Clients other professional adviser.
500-1.2

This Practice Standard relates to the Code through:Principle 3 - Competence and Rule 302;
Principle 4 - Fairness and Rules 402 and 404;
Principle 6 - Professionalism and Rules 606 and 609 and
Principle 7 - Diligence and Rule 701.
Principle 4 states that "A CFP Certificant shall perform professional
services in a manner that is fair and reasonable to Clients, and shall
disclose conflict(s) of interest (s) in providing such services." Rule
402 states that "A Financial Planning Practitioner shall make timely
written disclosure of all material information relative to the
professional relationship. In all circumstances such disclosure shall
include conflict(s) of interest (s) and sources of compensation." Rule
404 states that "should conflict(s) of interest(s) develop after a
professional relationship has been commenced, but before the
services have been completed, a CFP Certificant shall promptly
disclose the conflict(s) of interest(s)."
52
____________________________________________________________________________
Principle 6 states that "A CFP Certificant conduct in all matters shall
reflect credit upon the profession." Rule 606 states that "A CFP
Certificant shall perform services in accordance with: (a) Applicable
laws, Rules, and regulations of governmental agencies and other
applicable authorities;" Rule 609 states that "A CFP Certificant shall
not practise any other profession or offer to provide such services
unless the CFP Certificant is qualified and is licensed as required by
state law."
500-2
Selecting Products and Services For Implementation
500-2.1
Explanation
The Financial Planning Practitioner shall select appropriate products
and services that are consistent with the Client's goals, needs and
priorities.
A Financial Planning Practitioner will use professional judgement in
selecting the products and services that are in the Client's interest.
Professional judgement incorporates both qualitative and
quantitative information. A Financial Planning Practitioner shall
reasonably investigate and evaluate products or services that
address the Client's needs.
The Financial Planning Practitioner shall have a reasonable basis
for believing that the products or services selected are suitable for
the Client.
Products and services selected by the Financial Planning
Practitioner may differ from those selected by other practitioners or
advisors. Alternative products or services may be suitable for the
Client and could reasonably achieve the Client's goals, needs and
priorities, illustrating the subjective nature of exercising professional
judgement.
The Financial Planning Practitioner must make all disclosures
required to comply with applicable regulations.
Therefore the Financial Planning Practitioner shall be aware of and
understand various legal and regulation requirements in respect of
products and/or services recommended, their own limitations and
restrictions and know the roles and responsibilities of other
professionals, to enable the Financial Planning Practitioner and the
Client: to establish which strategies the Financial Planning
53
____________________________________________________________________________
500-2.2
Practitioner will be implementing and/or the Client will be

implementing,
to establish
who will be implementing the remaining
strategies as agreed;
to communicate in order to determine the status of the plan
implementation;
to modify the plan if a change is indicated during the
implementation stage.

This Practice Standard relates to the Code through:Principle 2 - Objectivity and Rule 202;
Principle 3 - Competence and Rule 302;
Principle 4 - Fairness and Rules 402; 403, 404, 408, 409, and 416;
Principle 6 - Professionalism and Rules 606 and 609
Principle 7 - Diligence and Rule 701, 703 and 704.
Principle 4 states that "A CFP Certificant shall perform professional
services in a manner that is fair and reasonable to Clients, and shall
disclose conflict(s) of interest (s) in providing such services."
Rule 402 states that "A Financial Planning Practitioner shall make
timely written disclosure of all material information relative to the
professional relationship. In all circumstances such disclosure shall
include conflict(s) of interest (s) and sources of compensation."
Rule 403 states that "A CFP Certificant providing Financial Planning
services shall disclose in writing prior to establishing a Client
relationship, relations which reasonably may compromise the CFP
Certificant's objectivity or independence."
Rule 404 states that "should conflict(s) of interest(s) develop after a
professional relationship has been commenced, but before the
services have been completed, a CFP Certificant shall promptly
disclose the conflict(s) of interest(s)"
54
____________________________________________________________________________
Rule 408 states that "When acting as an agent for a principal, A

CFP Certificant shall assure that the scope of his or her authority is
clearly defined and properly documented.'
Rule 409 states that "Whether a CFP Certificant is employed by a
Financial Planning firm, an investment institution, or serves as an
agent for such an organization, or is self-employed, all CFP
Certificant shall adhere to the same standards of disclosure and
service."
Rule 416 states that "If a CFP Certificant enters into a business
transaction with a Client, "the CFP Certificant shall disclose the risks
of the transaction, conflict(s) of interest(s) of the CFP Certificant,
and other relevant information necessary to make the transaction
fair to the Client."
Principle 6 states that "A CFP Certificant's conduct in all matters
shall reflect credit upon the profession."
Rule 606 states that "A CFP Certificant shall perform services in
accordance with: (a) Applicable laws, Rules, and regulations of
governmental agencies and other applicable authorities;"
Rule 609 states that "A CFP Certificant shall not practice any other
profession or offer to provide such services unless the CFP
Certificant is qualified and is licensed as required by state law."
Under Principle 6 states that "A CFP Certificant's conduct in all
matters shall reflect credit upon the profession."
Rule 606 states that "In all professional activities a CFP Certificant
shall perform services in accordance with: (a) Applicable laws,
Rules, and regulations of governmental agencies and other
applicable authorities; and (b) Applicable Rules, regulations, and
other established policies of FPSB."
Under Principle 7,
Rule 701 states that "A CFP Certificant shall provide services
diligently in providing professional services.".
Rule 703 states that "A Financial Planning Practitioner shall make
and/or implement only recommendations which are suitable for the
Client.
Rule 704 states that "A CFP Certificant shall make a reasonable
investigation regarding the financial products recommended to
Clients."
55
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600 Series Step 6: Monitoring the Financial Planning Recommendations

600-1
Defining Monitoring Responsibilities
600-1.1
Explanation
The Financial Planning Practitioner and Client shall mutually define
monitoring responsibilities
The purpose of this standard is to clarify the role, if any, of the
Financial Planning Practitioner's in the monitoring process. By
clarifying this responsibility, the Client's expectations are more likely
to be in alignment with the level of monitoring services which the
Financial Planning Practitioner intends to provide.
If engaged for monitoring services, the Financial Planning
Practitioner shall communicate to the Client those monitoring
activities the Financial Planning Practitioner is able and willing to
provide, of which shall be reduced as part of the terms of the written
agreement between the CFP Certificant and the Client. By
explaining what is to be monitored, the frequency of monitoring and
the communication method, the Client is more likely to understand
the monitoring services to be provided by the Financial Planning
Practitioner.
The monitoring process may reveal the need to reinitiate steps of
the Financial Planning process. The current scope of the
engagement may need to be modified.
At this stage the Financial Planning Practitioner should able to
monitor changes in a Clients situation, needs and objectives on an
ongoing basis and revise the Financial Planning plan if necessary
and as such the Financial Planning Practitioner shall understand
how changes in a Clients personal circumstances and tolerance for
risk may impact the Financial Planning plan. This is to ensure the
following: to be able to monitor changes in a Clients situation in
accordance with the terms of the engagement and recognize
when changes are needed in the financial plan;
to update a Clients financial plan as the situation dictates;
to explain the changes to the financial plan along with the
expected impact of the changes to the Client.
In addition the Financial Planning Practitioner should able to monitor
changes in the financial, economic, regulatory, legislative and
political environment that could affect a Clients situation and revise
the Financial Planning plan if necessary while maintaining the Client
relationship and as such the Financial Planning Practitioner shall be
56
____________________________________________________________________________
able to understand, recognise and explain to the Client when

financial, economic, regulatory, legislative and political changes
create situations where the Clients Financial plan should be
updated.
At this stage, the Financial Planning Practitioner shall produce an
updated list of recommendations in accordance with the terms of the
engagement wherein each recommendation has evidence of
acceptance, amendments, completion, deferral or rejection.
600-1.2

This Practice Standard relates to the Code through:Principle 7 - Diligence and Rule 702.
Principle 7 states that "a CFP Certificant shall act diligently in
providing professional services."
Rule 702 requires that CFP Certificant enter into an engagement
only after obtaining sufficient information to satisfy that "the
relationship is warranted by the individual's goals and objectives;
and the CFP Certificant has the ability to either provide requisite
competent services or to involve other professionals who can
provide such services."
57
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Appendix I
Source of References: Relevant Laws and Regulations
No
Related Areas of Principal Legislation Relevant to the Financial

Financial Planning Planning Industry
Industry
Licensing of a CFP
Certificant
Capital Markets and Services Act 2007 (CMSA)
Risk Management
and
Insurance
Planning
Licensing Handbook
Insurance Act 1996

Law governing insurable interest, insurance
trust, beneficiaries of life policies and general
insurances and on law of nomination;
Insurance Regulation 1996
Rules and Regulations on procedural
insurance and nomination claims;
Investment and
Planning Issues
Securities Commission Act 1993

Capital Markets and Services Act 2007 (CMSA)
Securities Industry (Central Depositories) Act 1991
Laws governing different type of permitted
investment scheme in Malaysia for investors
protection
58
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No
Related Areas of Legislation Relevant to the Financial Planning

Financial Planning Industry
Industry
Retirement Planning
Employees Provident Fund Act, Regulations 1991

Laws governing approved retirement funds
scheme in Malaysia, a statutory trust for the
benefit of old- age members of employees upon
retirement through management of members
savings in an efficient and reliable approach by
statutory body.
Employees Provident Fund Regulations, 1991
Rules and Regulations on Procedures of

Withdrawal of employees retirement funds
Pensions Act 1980

Laws governing pension scheme in Malaysia, a
statutory trust for the benefit of old- age members
of employees upon retirement
Tax Planning
Income Tax Act 1967
Laws governing tax on income ascribed to a

Malaysian before his death or his estate after
his death and related taxation issues;
Real Property Gain Tax Act, 1976
Laws governing tax on gains from sales of real

property
59
____________________________________________________________________________
No

Industry
Estate Planning
Wills Act 1959

Laws regulating will writing for non Muslim
Muslim Wills Enactment (Selangor), 1999
Laws regulating will writing for Muslim
Distribution (Amendment )Act 1997
Laws regulating distribution of assets of one
who dies intestate in West Malaysia and
Sarawak
Intestate Succession Act 1960
Laws regulating the distribution of assets of one
who dies intestate in Sabah
Small Estate (Distribution) Act, 1955
Laws regulating on small estate administration
Probate and Administration Act 1959
Laws regulating administration of testate and
intestate estate
Malaysian Inheritance (Family Provision) Act 1971
Laws regulating issue of claim for financial
support from estate by non Muslim dependants
60
____________________________________________________________________________
No

Industry
Estate Planning
Rules of High Court 1980 and Subordinate Court

Rules 1980
Procedural Rules regulating for non contentious
and contentious probate proceedings
Guardianship of Infant Act, 1961
Laws regulating guardianship of infants and
scope of powers of guardian
Individual and/or
Trustee Act 1949
Corporate
Laws regulating powers, duties and liabilities of
Financial Planning
trustee
Power of Attorney
Rules governing the authentication of powers of
attorney in Malaysia
Registration of Businesses Act 1956
Laws regulating business ownership
Partnership Act, 1967
Laws regulating partnership ownership
Companies Act 1965
Laws regulating companies ownership
61
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Appendix II
Frequently Asked Questions (FAQ)
A
No
1
Code of Ethics and Professional Responsibility (the Code)

Questions
Answers
What is the purpose

of the Code and why
is shall a CFP
Certificant
comply
with the Code?
The purpose of the Code in general terms is to

provide a source of guidance for all CFP Certificants
to
conduct Financial Planning services in
accordance with a set of approved FPAM standards
of principles and rules of which FPAM expects its
CFP Certificant to follow or comply with, to continue
its qualification to use the CFP certification mark.
Reason for compliance of the Code is to ensure that
the CFP Certificant is competent and professional
on par with international CFP standards.
To whom is the
Code applicable?
The Code is applicable to a person recognized and

certified by FPAM to use the CFP marks, whether
involved in the practice of personal Financial
Planning or otherwise.
However certain Rules of the Code may not be
applicable to that CFP Certificant's activities. For
example, a CFP Certificant who is engaged solely
in the sale of securities as a registered
representative is not subject to the written
disclosure requirements of Rule 402 (applicable to
CFP Certificants engaged in personal Financial
Planning) although he or she may have disclosure
responsibilities under Rule 401.
In a nutshell a CFP Certificant has to be familiar
with the scope of the Code to understand and
determine which of the rules of the Code are
applicable to the Certificant.
62
____________________________________________________________________________
A
No
3
Code of Ethics and Professional Responsibility (the Code)

Questions
Answers
How to determine
which Rules of the
Code are applicable
to
the
CFP
Certificants
activities?
A CFP Certificant is obliged to determine what

responsibilities the CFP Certificant has in each
professional relationship activities, including, for
example,
duties
that
arise
in
particular
circumstances from a position of trust or confidence
that a CFP Certificant may have. The CFP
Certificant is obliged to meet those responsibilities.
However if the CFP Certificant is not sure whether a
particular Rules of the Code is applicable to its
activities, he shall always consult FPAM for
assistance and clarification prior to any official
engagement with any potential Client.
63
____________________________________________________________________________
How does FPAM

monitor compliance
by a Certificant of
the Financial
Planning practice
standard?
FPAM monitors compliance by relying on feedback

and complaints received from anyone who lodges a
complaint to FPAM of any Certificants misconduct.
With respect to each individual complaint, the Chair
of the Board may, or may direct Staff Counsel to,
divide the Board into two panels consisting of an
Inquiry Panel and a Hearing Panel and designate a
Chair for each Panel. No member of an Inquiry
Panel shall act as a member of the Hearing Panel
on the same matter. In the event a matter is
referred to the Inquiry Panel for inquiry, if
subsequently referred for hearing, such matter shall
be heard by the Hearing Panel unless otherwise
exempted from such requirement by any other
provision of these Rules. CFP Certificants who
have demonstrated that they are unable, or are
likely to be unable; to discharge their professional
responsibilities shall be subject to appropriate
disciplinary procedures.
What constitute
breaches of
Financial Planning
practice standards?
When any act or omission of a CFP Certificant when

rendering financial advice service fails to comply
with the Practice Standards set out in the Manual.
Will it constitute a
breach of Financial
Planning practice
standard when a
CFP Certificant fails
to adopt or apply
one the procedural
steps of the
Financial Planning
practice standard
when rendering
financial service
advice to his Client?
It will not constitute a breach if the Client decides to

end the process but it may constitute a breach
should a CFP Certificant fails to adopt or apply one
the procedural steps of Financial Planning practice
standard when rendering financial service advice to
his Client, without justifiable reason acceptable to
FPAM;
64

FPAM Code of Ethics

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CODE OF ETHICS AND

FINANCIAL PLANNING PRACTICE

LIST OF RELEVANT LAWS AND

FREQUENTLY ASKED QUESTIONS

Code of Ethics and Professional Responsibility

Rules that Relate to the Principle of

Communication and Advertisement

Funds and/or Other Property of Client

Rules that Relate to the Principle of

Act In the Interest of Client

Rules that Relate to the Principle of

Keep Informed of Developments

Offer Service in Area of Competence

Rules that Relate to the Principle of

Disclosure Prior to Establishment of

Disclosure of Conflict of Interest

Annual Sources of Compensation

Fair and Reasonable Compensation

Agent For Principal

Agent For An Organization or Self

CFP Certificant As An Employee

Advise Outside Affiliations

Partnership On Mutual Disclosure

Fair Business Transaction with A

Disclosure of Other Compensation or

Disclosure Requirement On Services

Disclosure Requirement On Changes

Rules that Relate to the Principle of

No Disclosure of Client Relationship

Same Standard of Confidentiality To

Non Disclosure of Clients Name

Rules that Relate to the Principle of

Usage Of CFP Certification Mark

Fair And Honorable Competition

Prompt Notification To FPAM On

Prompt Notification To Appropriate

Not Engage in Conduct Adverse to

Disclosure as Registered Investment

Practise Only In Licensed Field

Return Clients Original Records In A

Not To Harass, Maliciously Injure,

Commitment To Post Certification

Rules that Relate to the Principle of

Consistent with Nature and Scope of

Code of Ethics and Professional Responsibility

Preamble and Applicability

Composition and Scope

certain Rules may not be applicable to that CFP Certificant's

compliance with applicable rules and regulations.

knowledge satisfactory and effectively in providing services to

only be built upon the understanding that information supplied to

Rules that Relate to the Principle of Integrity

Rule 101 Communication and Advertisement

activities and competence of the CFP Certificant. The term

(f) A CFP Certificant shall not take custody of a Clients property

Rules that Relate to the Principle of Objectivity

Rule 201 Professional Judgement

Rules that Relate to the Principle of Competence

Rule 301 Keep Informed of Developments

Rules that Relate to the Principle of Fairness

Rule 401 Relevant Material Professional Relationship Disclosure

Rule 406 Fair and Reasonable Compensation

Rule 410 CFP Certificant As An Employee