Masthead MasterClass addresses concerns of Eastern Cape advisors
Many advisors in the Eastern Cape are grappling with the repercussions of the economic climate, said Ferdi Coetzee, Masthead Regional Manager for the Eastern Cape. He was speaking to independent financial advisors (IFAs) at a recent Masthead MasterClass held in George, Gqeberha and East London.
“As clients scale back or cancel policies due to affordability concerns, IFAs find themselves in a challenging situation,” he explained. “Financial service providers (FSPs) with stable recurring income streams navigate these setbacks more effectively, whereas those relying on upfront income are experiencing financial strain.”
Succession planning is another concern, he added. “Many IFAs in the region struggle to attract and retain young advisors who often migrate to larger urban centres to join corporate firms.”
Compounded with these challenges is compliance with the ever-changing regulatory obligations placed on FSPs. “Working with our clients, we’ve found that many struggle to stay abreast of evolving legislation, notably the Financial Intelligence Centre Act (FICA). What’s more, the administrative burden associated with compliance processes leaves little time for Key Individuals to focus on the strategic business aspects of the practice, which is vital for the future longevity of the practice,” Coetzee explained.
He emphasised that legislation has grown more comprehensive and intricate, making it imperative for FSPs to thoroughly grasp and adopt the required compliance policies and procedures. “Mere surface-level compliance won't meet regulatory standards during audits. FSPs and their employees, from Representatives to admin staff – must be able to demonstrate a comprehensive understanding of all policies. The FSP must also be able to show that these procedures have been customised and applied to the business.”
As a response to this, the Eastern Cape Masthead team has been aiding IFAs in the region to enhance their compliance levels to align with the new and advanced requirements established by the Regulator. Additionally, the team is assisting clients in proactively preparing for impending legislative changes.
Helping IFAs become future fit
The Eastern Cape MasterClass, titled ‘Being Future Fit in an Ever-Changing Legislative and Economic Landscape’, provided IFAs with deeper insights into the challenges mentioned above. Moreover, attendees received guidance on effectively navigating these obstacles to construct sustainable, profitable businesses capable of weathering economic downturns and adapting to regulatory shifts.
The events commenced with a welcoming address by Joleen John, Masthead Group Managing Director, who discussed the present economic situation and how clients are concerned about its effects on their futures.
Coetzee's presentation, ‘Your Practice, Your Retirement’, offered practical strategies for IFAs to deliberately design, shape and invest in their financial planning practices to establish a future-ready, profitable and enduring business. This is vital for succession planning, whether the IFA owner intends to sell the business or scale down their involvement when reaching retirement age, he said.
For a comprehensive understanding of the intricacies of investing and saving within a fluid economic landscape, Christine Ellis, PPS Group Area Manager for the Eastern Cape, delved into recent shifts in the investment arena and their impact on the industry.
Addressing compliance and legislation, Anri Dippenaar, Masthead's Head of Compliance, explained how the Treating Customers Fairly (TCF) Outcomes have shaped the regulatory landscape. Furthermore, her presentation, ‘FAIS/FICA Audits: Navigating Risks’, outlined how Masthead aids IFAs in risk management and preparation for FAIS/FICA audits. She also discussed how the regulatory landscape will change in the coming years.
The East London MasterClass featured Marc Alves, Team Resolutions Manager for the FAIS Ombud, and Candice Jane, the Assistant FAIS Ombud. Their presentation, ‘Lessons from the FAIS Ombud’, delved into recent Ombud cases to analyse trends and identify pitfalls in the advisory domain that lead to client complaints and regulatory actions.
In Gqeberha and George, Charene Nortier, Manager of Financial Advisors and Intermediaries at FSCA, took to the stage. Her discussion, ‘Insights from the FAIS Office’, provided attendees with a deeper understanding of the Authority's audit process. She shared the primary risk areas identified during FSP audits over the past year, shed light on FSCA's FSP selection criteria for audits and discussed present and forthcoming financial soundness reporting obligations. Charene also looked at how proactive compliance with legislative requirements helps build future-ready advisory firms.
Attendees were able to engage with the presenters, event sponsors and fellow financial advisors. “The sense of community you get at these events is amazing. It reassures IFAs that they’re not alone in this ever-changing industry, and that there are companies like Masthead that dedicates its efforts and resources to ensuring the sustained independence and business success of IFAs,” said Coetzee.
