600-1: Defining Monitoring Responsibilities
The financial planning practitioner and client shall mutually define
Explanation of this Practice Standard
The purpose of this Practice Standard is to clarify the role,
if any, of the practitioner in the monitoring process.
By clarifying this responsibility, the client's expectations
are more likely to be in alignment with the level of
monitoring services which the practitioner intends to
If engaged for monitoring services, the
practitioner shall make a reasonable effort to define
and communicate to the client those monitoring activities
the practitioner is able and willing to provide. By
explaining what is to be monitored, the frequency of
monitoring and the communication method, the client
is more likely to understand the monitoring service
to be provided by the practitioner.
The monitoring process may reveal the need
to reinitiate steps of the financial planning process.
The current scope of the engagement may need to be modified.
January 1, 2002.
Relationship of this Practice Standard to CFP Board's Code of Ethics and Rules of Conduct
This Practice Standard relates to CFP Board's Code of
Ethics and Rules of Conduct
through Principle 7 - Diligence
and Rules 1.2, 3.3, 3.4 and 4.1.
Anticipated Impact of this Practice Standard
Upon the Public
The public is served when the practitioner and client have
similar perceptions and a mutual understanding about the
responsibilities for monitoring the recommendation(s).
Upon the Financial Planning Profession
The profession benefits when clients are satisfied. Clients
are more likely to be satisfied when expectations of the
monitoring process are both realistic and clear. This
Practice Standard promotes awareness that financial planning
is a dynamic process rather than a single action.
Upon the Financial Planning Practitioner
A mutually defined agreement of the monitoring responsibilities
increases the potential for client satisfaction and clarifies
the practitioner's responsibilities.
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