FPC001B - Short-Answer Questions Assignment

Assignment details

• This assignment covers Topics 1 to 7 and accounts for 40% of your final grade.
• There are two (2) sections in this assignment:
– Section A comprises four (4) short-answer questions worth a total of 47 marks.
– Section B comprises one (1) question worth a total of 48 marks.

Answer all questions.
• Marks will be awarded for referencing and presentation.
• Your overall mark for this assignment will be rounded to the nearest whole number.
• Refer to the Criteria-Based Marking Guide for guidelines on what is expected for each question.
• Full workings must be shown for all calculations. Show all calculations in the text of your assignment and not attached as an appendix. Appendices to the assignment will not be read.
• Indicative weightings are noted beside each question. Use these weightings to assist you with your allocation of time and resources. The weightings indicate the relative importance of each question.
• State all assumptions used in providing your answer.

Policies

• The overall word limit for the assignment is 4,500 words. Marks will only be awarded for answers up to the word limit (plus 10%) for each question. Any material written after this will not be counted towards your mark for that question. Headings, quotes and references within the body of the answer are included in the word count. Numerical tables, calculations and reference lists are not included. For more information on word counts and their rationale, go to Assessment ⇒ Assignment ⇒ Assessment Preparation Guide.
• The Assessment Preparation Guide contains information about format and presentation, word limits, citations and referencing, collusion, plagiarism and other policies, useful resources, submitting your assignment and accessing your results.
• Answers are to be in your own words. Reference and cite all your sources (within the text of your answer) when quoting or using material from external sources. Include a reference list at the end of your assignment.
• Follow the Harvard referencing style as recommended in Kaplan Australia: Harvard Referencing Guide located on the ‘Referencing and Research’ page in the ‘Build Your Skills’ hub in KapLearn.
• Requests for special consideration or information pertaining to special consideration written in the body of the assignment will not be considered by the assessor. Refer to the ‘special consideration’ section of the Assessment Policy on Kaplan’s website for more information.

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Independent research

For some or all questions in this assignment, you will be required to complete independent research beyond the provided materials. You will also be expected to analyse this research and use it to support your own reasoned conclusions.

This includes:

• considering multiple sources beyond topic notes or other provided resources
• ensuring sources are academically sound and credible
• analysing and understanding the argument or information the source presents
• using the material appropriately to directly support your

Where significant independent research is required for a given question, it will be clearly indicated in the question and the Criteria-Based Marking Guide.

Assignment referencing and presentation (5 marks)

Your assignment should be presented in a clear and appropriate format, with all sources correctly referenced and cited.

You are required to:

• structure a clear response to each question, using headings if required
• number questions (including sub-questions) and pages
• use correct font style and size
• ensure tables or graphs are clearly labelled and readable
• clearly set out calculations or workings, where they are required
• adhere to the assignment word limit
• follow the Harvard referencing style as recommended in Kaplan Australia: Harvard Referencing Guide (available from the ‘Build Your Skills’ hub in KapLearn) to cite sources throughout your assignment, and provide a reference list at the end.

Section A

There are four (4) short-answer questions in this section worth 47 marks. Answer all questions.

Question 1 

Disclosures (12 marks | Word limit: 600 words)

Sisters Emily and Kate (first introduced in the analysis task case study) have had a successful 12 months. They have implemented their new software at Kate’s hospital, and it has been adopted throughout the network of hospitals in Australia, New Zealand, Singapore and Hong Kong. They have made sufficient profit to buy out their Uncle Tom through fully franked distributions from their company to each other as shareholders. Kate now has $350,000 in her mortgage offset account. Emily has contributed $110,000 to her superannuation with the view to accessing it to purchase her first home.

The business structure they established was a trust with a corporate trustee of which both Emily and Kate are directors. Emily and Kate are the beneficiaries of the trust. Kate has established a trust, and that trust will be the beneficiary from the business trust, and Emily is a sole beneficiary of the business trust.

The sisters want to expand and realise that they need to employ more people to do that. They have found an empty former grocery store in a neighbourhood centre shopping strip. There is car parking underneath for staff and other shops and services in the centre that would make coming to the office a one-stop place for new staff.

You are a fully qualified financial adviser with 10 years’ experience. Kate sends you an email asking if you could provide them with advice. She has cc’d Emily into the message.

You reply to Kate and Emily that you would be happy to provide them with advice. You are already aware of some of their financial situation, and you customise your email response in the following way:

‘Hi Emily and Kate,

I’d be happy to discuss your financial situation and options with you.

I will need to gather some more information from you both about your current financial circumstances. Knowing your current corporate structure, would you consider setting up a self-managed superannuation fund (SMSF) and using your existing superannuation balances as a deposit for the new office, then borrowing the balance via the SMSF?

In any event, let’s arrange a time for a Zoom meeting and we will get started.’

Notes:

• You are required to undertake independent research to answer the following
• Take care to ensure you answer these questions using your own Where applicable,

your response should relate to the case study details provided and for parts where you utilise other resources to support your answer, ensure you cite and reference these.

• Given the content of the email, what two (2) disclosures should you provide to Emily and Kate at this early stage of the advice process and the legislative source of these (5 marks)
• Explain the purpose of each disclosure, with support from relevant ASIC Regulatory Guide(s).

(5 marks)

• What methods can you use to make those disclosures to Emily and Kate? (2 marks)

Question 2

Regulatory framework (10 marks | Word limit: 400 words)

Identify four (4) additional regulatory obligations placed on financial services providers under the current legislative and regulatory framework, aimed at ensuring that consumers, like Emily and Kate, are protected and receive appropriate financial advice.

For each regulatory obligation, discuss its legislative and/or regulatory source and how the obligations are intended to protect consumers. (10 marks)

Notes:

• Do not include the two (2) disclosure obligations already identified in Question
• You are required to undertake independent research to answer this
• You may include legislative and regulatory framework obligations which are legislated but not yet
• Your answer should only refer to the disclosure obligations for the provision of personal advice to a retail client when providing written advice to clients.

Question 3

Regulators as intermediaries (10 marks | Word limit: 500 words)

Regulators are important intermediaries in any financial services system. They promote the smooth operation of the markets and protect the integrity of the financial system. The level of regulation differs between countries; however, there has been an increasing trend around the world to tighten the regulation of financial markets in an attempt to protect investors. There are also a number of international regulators that provide international standards and give assistance and guidance to domestic

regulatory bodies.

For each of the regulatory bodies listed below:

• Briefly explain the role it plays in financial planning in
• Discuss what role the regulatory body has in contributing to Australia’s economic
• ASIC (2 marks)
• APRA (2 marks)
• ASX (2 marks)
• ACCC (2 marks)
• AUSTRAC (2 marks)

Notes:

• You are required to undertake independent research to answer this
• It is important here that you answer in your own words and do not copy/paste or paraphrase the course notes or commonly accessed websites for these
• You must address each regulator separately in your answer.

Question 4

Superannuation and changing government policy (15 marks | Word limit: 800 words)

Consider Kate and Emily from the case study in the analysis task and Question 1 of this assignment.

Provide discussion on the following points in relation to the superannuation system in Australia:

• Discuss the impact of two (2) changes to the superannuation system that were made during 2020 and 2021 which may impact Kate (now age 33) and Emily (now age 32). (5 marks)
• Discuss the potential impacts on the superannuation system generally of two (2) future changes to superannuation based on the federal government Budget of May (5 marks)
• Discuss how the changes from 2020 and 2021 would impact Kate and Emily in terms of their future retirement savings (5 marks)

Note:

• Support your answers with relevant independent
• You are not required to complete any calculations.

Section B

There is one (1) question with four (4) parts in this section. Answer all parts.

Question 5

Updated regulatory requirements (48 marks | Word limit: 2,200 words).

The critical role that commercial regulation plays in wealth management and financial planning is the promotion of confident and informed participation by investors and consumers in the financial system. In 2019, the following two legislative amendments were introduced:

1. Treasury Laws Amendment (Strengthening Corporate and Financial Sector Penalties) Act 2019 (Cth)
2. Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Act 2019 (Cth).

Addressing each of the two (2) legislative amendments above in turn, answer the following questions:

• Provide a summary of the amendment, including its purpose, referring to any other Acts that are impacted by the Include in your answer the origin of the amendment.

(What behaviours is the amendment attempting to eliminate?)

(6 marks per amendment, total of 12 marks)

• How have these amendments impacted the way ASIC operates?

(6 marks per amendment, total of 12 marks)

• Explain the impact for individual authorised representatives and AFS licence holders of the implementation of the change to the law. (7 marks per amendment, total of 14 marks)
• Explain how the amendment will impact the provision of personal financial advice to retail

(5 marks per amendment, total of 10 marks)

Notes:

• Structure your answer by addressing questions (a)-(d) in full relation to the first amendment, and then do the same for the second legislative amendment. Ensure that each part of your answer is clearly labelled and do not merge parts of your answers.
• Provide appropriate legislative references in your answers and assume any announced changes will proceed in

Answers should be in your own words and supported by research. Do not copy/paste from the course notes or key websites relating to these amendments, although you may cite them as part of your research.