/ Qualification Gap-Fill For CFPCM Professionals based on DRAFT Standards.
Institute of Financial Planning

This is a template for the use of CFPCM professionals. This template is the result of mapping the CFPCM certification standards against the draft standards, rather than the final standards specified by the FSA. The learning outcomes indicated with N will need to be met with structured CPD or through other qualifications. A separate template mapping the CFPCM certification against the final standards is available. Either template may be used.

For further guidance, please contact the IFP.

Financial services, regulation and ethics

Topic / New draft exam standards / Learning Outcome No. / Indicative content / Covered in qualification? (Y/N) / Evidence of CPD top up and dates
Regulation / Understand the UK financial services industry, in its European and global context: / 1. / additional oversight – senior management, external compliance support services / N
2. / FSMA 2000 / N
3. / role of the FSA, Treasury and Bank of England in regulating markets / N
FSA responsibilities / Understand the FSA’s responsibilities in the regulation of financial services: / 4. / statutory objectives and how the FSA is structured to achieve these / N
5. / financial stability and prudential regulation / N
6. / regulatory processes, significant influence functions / N
7. / the FSA’s use of outcomes-focused regulation to promote ethical and fair outcomes / N
FSA responsibilities / Understand the FSA’s responsibilities in the regulation of financial services: / 8. / the responsibilities that rest with approved persons and the need for integrity, competence and fair outcomes for clients, including dealing with conflicts of interest / N
9. / the overarching code of ethics / N
10. / the professional principles and values on which the code is based / N
11. / identifying and managing ethical dilemmas / N
12. / the outcomes that may result from behaving ethically and unethically for the industry, the firm, individual advisers and consumers / N
Regulatory advice framework / Apply the regulatory advice framework in practice for the consumer: / 13. / client relationships and adviser responsibilities, fiduciary relationship – duty of care, confidentiality, primacy of clients’ interests / N
14. / taking into account relevant changes when monitoring and reviewing clients’ plans and circumstances / Y
Legal / Understand the legal concepts and considerations relevant to financial advice: / 15. / use of trusts / Y
16. / the main types of trusts and their uses / Y
17. / the creation and administration of trusts / Y

Investment principles and risk

Topic / Existing exam standards / New exam standards / Covered in qualification? (Y/N) / Evidence of CPD top up and dates
Macroeconomic environment / Understand the macroeconomic environment and its impact on asset classes: / 18. / global socio-economic trends / Y
19. / overview of world economics and globalisation of markets / N
20. / economic and financial cycles, predictability, regional economy differences / N
21. / economic indicators – trends and their interpretation / N
22. / relevance of money, inflation, deflation, interest rates and exchange rates / Y
23. / balance of payments and international capital flows / N
Asset classes / Analyse the characteristics, tax treatment, inherent risks and behaviours of investment products: / 24. / the advantages and disadvantages of direct investment in securities and assets compared to indirect investment through collectives and other products / Y
25. / Exchange Traded Funds (ETFs) and Exchange Traded Commodities (ETCs) / N
26. / Child Trust Funds (CTFs) / Y
27. / enterprise investment schemes / N
28. / hedge funds and funds of hedge funds / N
/ On same basis as CII – 2 May 2011
IFP - ED128 05/11
CFPCM, CERTIFIED FINANCIAL PLANNERCMand are certification marks owned outside the U.S. by Financial Planning Standards Board Ltd. Institute of Financial Planning is the marks licensing authority for the CFP marks in the United Kingdom, through agreement with FPSB. / Page 1
/ On same basis as CII – 2 May 2011
IFP - ED128 05/11
CFPCM, CERTIFIED FINANCIAL PLANNERCMand are certification marks owned outside the U.S. by Financial Planning Standards Board Ltd. Institute of Financial Planning is the marks licensing authority for the CFP marks in the United Kingdom, through agreement with FPSB. / Page 1
Asset classes / 29. / structured products – income and capital growth, structure and analysis / Y
Analyse the characteristics, inherent risks, behaviours and correlation of asset classes: / 30. / cash equivalents / Y
31. / private equity / N
32. / valuation measures / N
33. / property – income profile and gearing / N
34. / pricing, liquidity and fair value / N
Investment and risk theory and principles / Understand the merits and limitations of the main investment theories: / 35. / modern portfolio theory / N
36. / multi-factor model / N
37. / efficient market hypothesis / N
38. / capital asset pricing model / N
39. / basics of behavioural finance – market and individual behaviour / Y
40. / portfolio theory, diversification and hedging, correlation between asset classes, total return and an awareness of beta and alpha / N
Apply the principles of the time value of money and discounting: / 41. / apply the principles of the time value of money and discounting / Y
Analyse and explain the nature and impact of the main types of risk on investment performance: / 42. / liquidity and access / Y
43. / income and capital growth including shortfall / Y
44. / short-term volatility / Y
45. / long-term performance / Y
46. / gearing / N
47. / currency / N
48. / interest rates / Y
49. / systematic and non-systematic, including fraud and counterparty, institutional, market timing / N
Advice process / Apply the investment advice process: / 50. / explain the investment process / Y
51. / establish client relationships, capability and circumstances, including assets and debts / Y
52. / agree and prioritise needs and wants / Y
53. / agree investment objectives, growth, income, time horizons, debt and credit management and repayment / Y
54. / agree strategy and rationale to achieve objectives / Y
55. / agree benchmark/performance measures and review process / Y
Assess other suitability considerations such as ethical, social responsibility and religious preferences: / 56. / assess other suitability considerations such as ethical, social responsibility and religious preferences / Y
Asset allocation / Understand the principles of investment planning:
Portfolio construction: / 57. / stochastic modelling / N
58. / tactical and strategic asset allocation / N
59. / stock and fund selection / N
60. / diversification by sector, geographical area and currency / Y
61. / main fund management strategies and styles / Y
62. / costs, charges and TER / Y
63. / selection of products, tax wrapper and services / Y
64. / provider selection / N
65. / the concept, uses, benefits, risks and costs / charges of wraps and other platforms / Y
Investment performance / Analyse the performance of investments – portfolio performance: / 66. / methods of evaluating portfolio performance / N
67. / selection and use of benchmarks / N
68. / new money and timing factors / N
Portfolio review and administration: / 69. / changes in client circumstances / Y
70. / changes in financial environment / Y
71. / new products and services available / Y
72. / use of external services / benchmarking / N
73. / rebalancing. / Y

Personal taxation

Topic / Existing exam standards / Learning Outcome no. / New exam standards / Covered in qualification? (Y/N) / Evidence of CPD top up and dates
UK taxation system / Understand the UK tax system as relevant to the needs and circumstances of individuals and trusts: / 74. / national insurance contributions (NICs),liability for employers, employees, self-contribution levels, voluntary NICs / Y
75. / UK tax compliance – self assessment, tax returns, tax payments, tax evasion and avoidance issues / Y
76. / residence and domicile – impact on income tax, capital gains tax (CGT) and inheritance tax (IHT) / Y
77. / stamp duty land tax, transactions subject to tax, main reliefs / N
78. / outline of Value Added Tax (VAT) / N
Analyse the taxation of investment as relevant to the needs and circumstances of individuals and trusts: / 79. / direct investments – cash and cash equivalents, fixed interest, securities, equities and property / Y
UK taxation system / Analyse the taxation of investment as relevant to the needs and circumstances of individuals and trusts: / 80. / indirect investments – pension arrangements / Y
81. / indirect investments – Individual Savings Accounts (ISAs) / Y
82. / indirect investments – Child Trust Funds (CTFs) / Y
83. / indirect investments – onshore and offshore collectives and investment companies / Y
84. / indirect investments – onshore and offshore life assurance policies / Y
85. / indirect investments – Real Estate Investment Trusts (REITs) / Y
86. / indirect investments – Venture Capital Trusts (VCTs) / Y
87. / indirect investments – Enterprise Investment Schemes (EISs) / Y
88. / the main uses of lifetime gifts and trusts in basic IHT mitigation / Y
Apply the knowledge of personal taxation to the provision of investment advice: / 89. / carry out the most common tax computations, including the impact of lifetime transfers and transfers at death / Y
90. / make essential tax planning recommendations regarding investments and pensions / Y

Retirement planning

Topic / Existing exam standards / Learning Outcome no. / New exam standards / Covered in qualification? (Y/N) / Evidence of CPD top up and dates
Environment / Understand the political, economic and social environment factors that provide the context for pensions planning: / 91. / role of government, policy direction, challenges and proposed reforms / N
92. / corporate responsibilities, challenges and impact on pension provision / N
93. / demographic trends, longevity and ageing population / N
94. / incentives, disincentives and attitudes to saving / Y
Tax / Understand how the HMRC tax regime applies to pension planning: / 95. / death benefits before and after payment / Y
96. / outline of the relevant transitional reliefs post-Finance Act 2006 / N
97. / outline of the tax treatment of other scheme types – Employer Funded Retirement Benefit Schemes (EFRBS), Qualifying Overseas Retirement Schemes (QROPS) / N
State provision / Understand the structure, relevance and application of state schemes to an individual’s pension planning: / 98. / understand the structure, relevance and application of state schemes to an individual’s pension planning / Y
Defined benefit schemes / Understand the structure, characteristics and application of defined benefit schemes to an individual’s pension planning: / 99. / options, limitations and restrictions / Y
Defined contribution schemes / Analyse the range of defined contribution scheme options as they apply to an individual’s pension planning: / 100. / options and impact on decisions / Y
Drawing retirement benefits / Analyse the options and factors to consider for drawing pension benefits: / 101. / defined contribution unsecured pensions / Y
102. / compliance requirements for defined contribution schemes / Y
103. / triviality rules / N
Legal / Understand the relevant aspects of pensions law and regulation to pensions planning: / 104. / pensions regulator compliance requirements / N
105. / pension protection schemes / N
106. / trust and contract-based pensions / N
107. / role and duties of trustees and administrators / N
108. / employment law relevant to pensions / N
109. / bankruptcy law relevant to pensions / N
/ On same basis as CII – 2 May 2011
IFP - ED128 05/11
CFPCM, CERTIFIED FINANCIAL PLANNERCMand are certification marks owned outside the U.S. by Financial Planning Standards Board Ltd. Institute of Financial Planning is the marks licensing authority for the CFP marks in the United Kingdom, through agreement with FPSB. / Page 1