Moonstone: FSB Responds to Complaints regarding Costs

The second newsletter of 2011 from the FSB contains answers to a number of questions, including allegations that have grown over the last few weeks. We re-publish their response below:

The fee for the regulatory examination is too high / it’s a money making scheme.

The fee for the regulatory examination was set as follows:

In 2008 the four Examination Bodies submitted their budgets and cost estimation in terms of what it will cost to develop the regulatory examinations, as well as what it will cost to roll out these examinations. Cost included for example direct, indirect and development costs such as invigilators, venues, courier costs, printing and stationary, travel, moderation and assessor costs, marketing costs, IT Bandwidth and license fees, rent, set-up of fixed assets, setting examinations and IT development.

The number of examinations per examination category for the level 1 and level 2 examinations were also taken into consideration, and the cost for these examinations were calculated.

The fee per examination was then calculated based on the premise that the examination bodies should break even within the first 4 years. The intention was to keep the cost per examination as low as possible.

The fee was then set at R900 per examination, and the FSB receives R20 of this fee from the Examination Bodies in order to cover administrative, oversight and IT development costs.

It should also be noted that the fee was calculated on the budgets submitted in 2008, which have not taken into consideration any inflation over the last 2 years. There is also no intention to increase the fee until such time that the regulatory examination level 2 period is completed i.e. 31 December 2013.