- Personal advice authorisations in the financial products you wish to advise clients on e.g.: securities, government debentures, derivatives, interests in managed investment schemes (including Managed Discretionary Accounts (MDAs)), life products, general insurance, standard margin lending, superannuation and deposit products.
- Dealing authorisations to apply for, acquire, vary or dispose of managed investment schemes and other financial products on behalf of your clients e.g.:securities, government debentures, derivatives, interests in managed investment schemes (including Managed Discretionary Accounts (MDAs)), life products, general insurance, standard margin lending, superannuation and deposit products.
Sophie Grace will work with you to ensure you seek and obtain the appropriate authorisations needed to operate your business. Financial product/service delineations and boundaries are complex and it is easy to overlook or inaccurately define an aspect of your activities. There are serious penalties and repercussions for operating without an AFSL or without the correct authorisations.
2. Choose your Responsible Managers – You must ensure that the Responsible Managers nominated have appropriate skill and experience to provide the authorisations that your business is seeking. Broadly, this means they will:
- need to have worked in Australia for an AFSL for at least 3 in the past 5 years, or 5 in the past 8 years;
- have a university degree in a relevant field (e.g. commerce, science, economics);
- have held RG146 in in all products you will provide advice in;
- be able to provide at least two referees;
- not be associated with more than one other AFSL (as RM, shareholder or director);
- have clear criminal and bankruptcy checks.
3. Draft your Documents for ASIC – The documents submitted to ASIC for your AFSL application are known as ‘Proof Documents’. There are two types of proof documents, ‘Core Proofs’ and ‘Additional Proofs’. Sophie Grace will work closely with you to prepare the following proof documentation to meet the requirements of your ASIC AFSL application:
- Business Description
- People proofs for each nominated Responsible Manager
- Organisational Expertise Table
- Financial Resources Statements
Recently ASIC has stated that they require additional information relating to this type of AFSL application, including:
- specific details of your margin lending activities, including procedures to gather information from the client, the products which form the basis of the margin loan and minimum loan to value ratio;
- the details of your Professional Indemnity Insurance including a statement regarding any exclusions;
- evidence that the RMs have provided advice in relation to all products requested on the application and specific detail regarding the type of advice and how many clients RMs have dealt with.
4. Additional Proof Documentation – Depending on the authorisations for which your business is seeking to be Licenced, ASIC will require the submission of additional proof documentation. Sophie Grace will prepare these documents for you and liaise with ASIC on your behalf. Some of the documents which may be required include:
- Development Program for Responsible Managers
- Compliance Arrangements
- Outsourcing Statement
- Conflicts of Interest Arrangements
- Program for monitoring, supervision and training of Representatives
- Human Resources Capacity Statement
- Information Technology Capacity Statement
- Dispute Resolution System Statement
- Risk Management System Statement
- Compensation Capacity Statement
5. Ongoing AFSL Procedural Documentation – The ongoing compliance obligations of your new or varied AFSL will require procedure documents to maintain the good standing of your AFSL. Refer to our section on AFSL Procedural Documentation for more information.