For CFP® Professionals

Financial Planning

Question 1-1: How does CFP Board define financial planning?

Question 1-2: Will CFP Board consider an engagement to be financial planning solely because the CFP® professional used the six-step process?

Question 1-3: Does CFP Board require CFP® professionals to address a certain number of subject areas for the engagement to be considered financial planning?

Question 1-4: Does CFP Board require CFP® professionals to address particular subject areas in order for the engagement to be considered financial planning?

Question 1-5: Does CFP Board require CFP® professionals to complete all six steps for an engagement to be considered financial planning?

Question 1-6: Will CFP Board consider future engagements to be financial planning because the CFP® professional provided financial planning to the same client(s)?

Question 1-7: Will CFP Board consider an engagement to be financial planning solely based on the compensation model used by the CFP® professional?

Question 1-8: What types of activities are considered “material elements of financial planning”?

Question 1-9: How can CFP® professionals determine when a specific service or activity rises to the level of financial planning?

Question 1-10: What should I do if I am unsure whether a specific service or activity rises to the level of financial planning?

Question 1-11: What distinctions do the Standards make between financial planning services and other services that don’t rise to the level of financial planning?

Question 1-12: Does conducting a needs analysis or suitability review reach the level of financial planning or material elements of financial planning?

Question 1-13: How many elements of the financial planning process can a CFP® professional provide without having those activities constitute “material elements of financial planning”?

Question 1-14: How many financial planning subject areas can a CFP® professional address with a client without reaching the level of “material elements of financial planning”?

Question 1-15: In situations where a CFP® professional implements financial planning recommendations prepared by a third party, will the CFP® professional’s implementation activities be considered financial planning or material elements of financial planning?

Question 1-16: Is a CFP® professional who provides financial planning services more likely to be disciplined by CFP Board than a CFP® professional who does not provide financial planning services?

Fiduciary Duty

Question 2-1: Why doesn't CFP Board just say that all CFP® professionals are fiduciaries?

Question 2-2: How can a CFP® professional be certain that a recommendation is the “best” for a client, given the enormous variety of financial strategies and products available?  Does CFP Board expect CFP® professionals to investigate every conceivable option that might be available to a particular client?

Question 2-3: Is it possible for a CFP® professional to be subject to two different standards of care at the same time under CFP Board Rules of Conduct?

Disclosure & Written Agreement – Financial Planning

Question 3-1: What disclosures do the Standards require for client engagements that do involve financial planning or material elements of financial planning?

Question 3-2: When, what and how does CFP Board require disclosure to clients and prospective clients when providing financial planning?

Question 3-3: Does CFP Board expect CFP® professionals to hand deliver disclosure documents, or can the documents be posted or delivered on a CFP® professional’s or the CFP® professional’s employer’s Web site?

Question 3-4: When should a CFP® professional send out disclosure documents to clients?

Question 3-5: In what ways are the disclosures required by the current Standards different from the disclosure requirements in the former Standards?

Question 3-6:: How does a CFP® professional disclose compensation?

Question 3-7: What does CFP Board mean by “costs” and “any other sources of compensation”?

Question 3-8: Is any additional written documentation required by the Standards?

Question 3-9: Will CFP Board provide sample agreements and disclosures that CFP® professionals can use with their clients?

Disclosure – Non-Financial Planning

Question 4-1: What disclosures do the Standards require for client engagements that do not involve financial planning or material elements of financial planning?

Question 4-2: When, what and how does CFP Board require disclosure to clients and prospective clients when not providing financial planning? 

Question 4-3: Does a CFP® professional who is not providing financial planning or using the financial planning process need to provide clients or prospective clients with written disclosure documents?

Principal Trades & Proprietary Products

Question 5-1: How do the Standards relate to CFP® professionals who provide clients principal-trade transactions?

Question 5-2: Do the Standards apply to CFP® professionals who recommend or sell proprietary financial products?

Federal & State Regulation

Question 6-1: How do the Standards relate to federal and state statutes, rules, regulations and case law with respect to the obligations of a CFP® professional?

Question 6-2: Why doesn’t CFP Board use the same definitions used by federal and state regulators and courts for important terms such as “financial planning” and “fiduciary”?

Question 6-3: Will the Standards be applied differently for CFP® professionals with different licenses or registrations (such as registered representatives, investment adviser representatives, insurance agents)?

Holding Out

Question 7-1: Do the Standards apply to those who hold CFP® certification but who do not display the CFP® marks or hold themselves out as financial planners?

Team Arrangements

Question 8-1: How do the Standards relate to CFP® professionals who provide services as part of a team arrangement?

Terminating Engagements

Question 9-1: Is it possible for a client of a CFP® professional to terminate the financial planning engagement with the CFP® professional and still receive other services from the CFP® professional?

Firm Obligations

Question 10-1: Are firms required to ensure that their employees and representatives who hold the CFP® certification adhere to CFP Board’s ethical standards?

Liability

Question 11-1: Do the Standards increase liability for CFP® professionals?

Why Revise the Standards?

Question 12-1: Why did CFP Board revise the ethical standards for CFP® professionals?

Question 12-2: Are the current Standards stronger than the former Standards?