FOFA – Dispute Resolution: Workplace Simulation

Assessment Activity

I have read and understood the assessment instructions provided to me in the Learning Management System.

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I certify that the attached material is my original work. No other person’s work hasbeen used without due acknowledgement. I understandthat the work submitted may be reproduced and/or communicated for the purpose of detecting plagiarism. 

  Student Name*:    Date:*

I understand that by typing my name or inserting a digital signature into this box that I agree and am bound by the above student declaration.Important assessment information Aims of this assessment .

This simulated workplace assessment activity is conducted to the standard expected in the workplace in order to demonstrate consistent performance of typical activities experienced in the financial services industry.This assessment focusses on a real life scenario where a financial planning firm was taken to the Financial Ombudsman Service (FOS) as a result of a client complaint.

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This compliant arrived at the FOS after the adviser and client unsuccessfully attempted to navigate a solution via the internal complaints process offered by the financial planning firm. This assessment addresses the six steps of the financial planning process in the context of a client compliant.  Using the case study from the FOS, it requires the six step process to be broken down in detail to identify where key communication and procedural obligations (if applicable) were (and were not) followed. 

Key areas of focus include the Financial Services Guide (FSG), Client Questionnaire, Risk Profile, Statement of Advice (SOA), Product Disclosure Statement (PDS), Authority to Proceed, and arrangements for review.Marking and feedbackThis assignment contains 1 assessment activitycontaining specific instructions.This particular assessment forms part of your overall assessment for the following units of competency:

  • FNSCUS505
  • FNSCUS506
  • FNSFPL501
  • FNSIAD501
  • FNSFPL505

Grading for this assessment will be deemed “competent” or “not-yet-competent” in line with specified educational standards under the Australian Qualifications Framework.What does “competent” mean?These answers contain relevant and accurate information in response to the question/s with limited serious errors in fact or application. If incorrect information is contained in an answer, it must be fundamentally outweighed by the accurate information provided. 

This will be assessed against a marking guide provided to assessors for their determination. What does “not-yet-competent” mean?This occurs when an assessment does not meet the marking guide standards provided to assessors. These answers either do not address the question specifically, or are wrong from a legislative perspective, or are incorrectly applied. Answers that omit to provide a response to any significant issue (where multiple issues must be addressed in a question) may also be deemed not-yet-competent.

Answers that have faulty reasoning, a poor standard of expression or include plagiarism may also be deemed not-yet-competent. Please note, additional information regarding Monarch’s plagiarism policy is contained in the Student Information Guide which can be found here:What happens if you are deemed not-yet-competent?In the event you do not achieve competency by your assessor on this assessment, you will be given one more opportunity to re-submit the assessment after consultation with your Trainer/ Assessor. You will know your assessment is deemed ‘not-yet-competent’ if your grade book in the Monarch LMS says “NYC” after you have received an email from your assessor advising your assessment has been graded.

Workplace Simulation


It is your responsibility to ensure your assessment resubmission addresses all areas deemed unsatisfactory by your assessor. Please note, if you are still unsuccessful in meeting competency after resubmitting your assessment, you will be required to repeat those units.In the event that you have concerns about the assessment decision then you can refer to our Complaints & Appeals process also contained within the Student Information Guide.

Expectations from your assessor when answering different types of assessment questions

Knowledge based questions:A knowledge based question requires you to clearly identify and cover the key subject matter areas raised in the question in full as part of the response.Skill based questions:Where you are asked to write as though you are speaking to a client, your answers must show your ability to:

  • understand your client’s concerns/perspective/views
  • show empathy
  • display a professional response
  • explain ideas clearly and simply so your client can understand the issues

Finally, good luck with your learning and assessments and remember your trainers are here to assist you J   

Activity instructions to candidates

  • This is an open book assessment activity.
  • You are required to read this assessment and answer all 7 questions that follow.
  • Please type your answers in the spaces provided.
  • Please ensure you have read “Important assessment information” at the front of this assessment
  • Estimated time for completion of this assessment activity: 3-4 hours


Module 1 covered the legal obligations and the six-step process financial advisers must follow when providing financial advice to clients. Not adhering to these obligations will inevitably lead to client complaints. Depending on the circumstances, this may lead to a range of adverse outcomes for an adviser. This includes monetary penalties, the AFSL withdrawing an adviser’s letter of authority that allows them to continue to work as an authorised representative, or in very serious circumstances, criminal charges being applied.As indicated in the course materials, the Financial Ombudsman Service (FOS) is an approved external dispute resolution scheme approved by ASIC.

Go tofor more information. While seeking to resolve a client dispute internally is preferable compared to allowing a dispute to reach FOS, sometimes internal dispute resolution processes break down. It is at this point that every obligation you have learnt about in your studies will be analysed by FOS in detail in regard to the advice process.At the end of this work place simulation, we have included a real FOS Case Determination between an aggrieved client and a financial planning firm. FOS protects the identity of both the financial planning firm and the client. Because the determination is a legal document, the client is called the “Applicant”, and the financial planning firm which stands for Financial Services Provider is referred to as “FSP”.

You will see it also refers to the actual financial adviser as “Ms A”, and the actual clients as “Mr H” and “Mrs H”. The FOS determination is 10 pages in length. While the client was not successful in this FOS claim against the financial adviser or the firm, it illustrates very salient insight into why financial planners must follow their obligations so carefully. You must read this document in full in order to answer the questions in this assessment.For your general interest, the FOS case number is 200885. If you ever want to source this case directly from FOS for any reason, it can be found by going to  and searching under “Decisions” in the top right search section of the FOS homepage.

You can then type in the Case Number.Required First, you are to read carefully the FOS Determination (note: it is contained in Appendix 20 of the Module 1 course materials). Second, you are then required to answer the following questions in the context of the information you have learnt in Module 1.

  • Summarise the advice recommended by Ms A  
  • Stipulate the date Ms A prepared the SOA, and the date the subsequent advice was actioned including the amount invested.  
  • Summarise the client’s grievance 
  • List precisely what parts of the 6 Step Process Ms A followed (…or did not follow) based on your analysis of the case. 
  • Important: The required minimum word length for this answer is 300 words.
  • Refer to the “Reasons for Decision” section on page 5 of the FOS Determination. Summarise FOS’s decision, and make reference to the following issues:
    1. FSG
    2. Fact Find (i.e. Client Questionnaire)
    3. Risk Profile
    4. Statement of Advice (SOA)
    5. Product Disclosure Statement (PDS)
    6. Authority to Proceed 
  • Refer to “Step One” of the six-step financial planning process outlined in the course materials – specifically the sub-heading titled “capturing a client’s risk tolerance” and “what is the client’s real risk profile”. Explain what practical measures you think Ms A could have undertaken so that Mr and Mrs H understood the risks of Ms A’s recommended investment portfolio better?


  • Refer to “Step Six” of the six-step financial planning process outlined in the course materials. Explain why you think FOS made a finding that despite Ms A not reviewing Mr and Mrs H’s portfolio, Ms A was not at fault. Explain in the context of the purpose of reviewing, revising and maintaining a financial plan.

Assessment Activity

Workplace Simulation

FOFA – Dispute Resolution

Ms A suggested investing their money in a multi-sector retail investment area. Clients explain that Ms A advised the investment platform on the basis “she would review our investment on continuous basis, and to contact them in case of any massive fluctuations within performance.

SOA constructed on 18th April 2006. 19th April 2006, advice was actioned and Risk Profile altered  and on 20th the cheque was deposited in the bank of $334,000.

The complaints of the client was that they were promised of frequent meetings but even after calling MS A, the person was unavailable and the client had problems as they were promised to be  reviewed on a continuous basis and were out of contact for more than 3 months.

They increased their risk profile from the moderate to aggressive on the suggestion of Ms A and were not said that they would have to pay a fee if they wished to change their asset allocation. The client were not given the FSG and during the time of investment the client were assured that Ms A’s other investors receive return of 15-20% which they were not receiving.     

Step 1: Ms A followed step 1 by following the collection of the risk profile, data and from her evidence provided a copy of the FSG. The couple signed the fact find document as being correct.

Step 2: Ms A discovered the goals and objectives of the couple by filling out the fact finding document and having the clients sign this data as precise.

Step 3: Ms A did try to discover any financial issues that may come for the couple, by enquiring about future expenses in regards to the probability of purchasing a house, but the couple indicated that their time period was 5-7 years in the questionnaire.

Step 4: Ms A did construct the SOA for the clients and provided all the needed information, and the clients signed the documents to address that this was true. But Ms A did not write the services that would be provided to the couple and this is what created the problem.

Step 5: Ms A did incorporated the agreed plan

.Step 6: Ms A did not review the couples plan, which  was supposed to be done. 

In accordance to FSG it is said that the client needs to sign the FSG and once it is signed it asks the consultant to provide them with an ongoing service with respect to the investments that have been advised. However, in this case, it is seen that the consultant has not done the same and therefore is liable to be answered for not doing the same. The consultant can be charged a penalty as well.  

The fact find provides the questionnaire with the help of which the clients provide all their answers and the investments they want to undertake and their goals and objectives but Ms A did not look into the same and prepared something own. This is ought not to be done.

 The risk profile addressed the risk taking mentality and the kind of investments the client want to undertake. However, Ms A influenced the client to move from moderate to above moderate without their consent and this created additional pressure and risk for the client.

The Statement of Advice that has been created does not provide all the aspects that needs to be mentioned and Statement of Advice prepared has not been properly fed to the client in order to provide them with the precise knowledge about their investment. This led to several issues and finally the compelled the client to move to another consultant. 

The product disclosure statement was incomplete and therefore when the client wanted to change their investment assets they were not aware that fees would be charged for the same. The disclosures were not totally met and the consultants after the completion of the disclosure statement had to sign the same.   

The Authority to Proceed was incomplete and this form is only signed after all the above documents have been completely understood by the client.  Therefore, without providing proper knowledge Ms A completed all the formalities.

In order to provide effective advices to the clients the consultant needs to have adequate knowledge about the objectives, goals and the desires of the client and their attitude towards investments, risks , retirement planning etc. Hence, Ms A had to determine the attitude of the client with respect to inflation, present income need, need of liquidity, issues regarding capital loss, demand for capital and growth, taxation factors, the level of security desired from the investment, volatile of the investment in the short term etc.

Ms A had to ensure that the goals of the couple were in line with the actual demand in the market.   

It is due to the fact that it is essential to make sure that the recommendations are suitable for the client and any changes had to be reviewed on a yearly basis. As the clients were there with Ms A, it suggests that Ms A had been reviewing the portfolio and therefore the couple were not bothered.

The clients on the other hand monitored their investments through internet in every six months so the clients had knowledge about their investment movements. In addition, when the couple tried to contact with Ms A, she defended it by telling to wait out the scenario as the market would improve and at that point of time the client accepted the same. Therefore, Ms A is not at fault.