Personal Financial Planning and Superannuation is an elective segment offered in the CPA Program.
The primary objective of this segment is to provide a practical, applied coverage of the key areas relating to personal financial planning and superannuation. The taxation and social security implications associated with various investment options are considered in detail.
For the superannuation component, emphasis is placed on understanding the regulatory and reporting framework within which superannuation funds must operate.
At the completion of the segment, candidates should be able to draw together the various elements in the preparation of a comprehensive Statement of Advice.
The Personal Financial Planning Segment segment requires a broad range of skills, but particularly requires a high level of reading and mathematical skills, together with an ability to synthesise materials.
It is recommended that candidates have access to the most recent edition of the Corporations Act 2001 (Cwlth).
The course structure is cumulative. Therefore, candidates will gain most from the materials by working progressively through the study guide.
The segment is also listed on the Australian Securities and Investments Commission (ASIC) register of RG 146 compliant training courses in conjunction with a further skills component. The segment meets the generic knowledge requirements plus the following two specialist knowledge components:
- financial planning
- superannuation
Following completion of the segment, candidates wishing to comply with the PS146 training requirements will also need to complete one of the following:
- a one day client relationship training workshop
- the CPA Australia Mentor Program achieving the Financial Planning competency at level 1
CPA Program enrolees who work in the financial planning industry will meet the PS146 skill requirements upon completion of the Mentor Program.
The content of the Personal Financial Planning and Superannuation segment is as follows:
Module 1: Introduction to financial planning
- the need for financial planning
- what is financial planning?
- life cycle
- the financial planning environment
- the economic environment
- the political environment
- the social environment
- regulatory framework
- the ASIC
- the Australian Prudential Regulation Authority
- the Financial Services Reform Act 2001 (Cwlth) (FSRA)
- common law principles, disclaimers, complaint resolutions and compensation arrangement
- common law
- Trade Practices Act 1974 (Cwlth)
- complaints resolution
- disclaimers and exclusion clauses
- professional conduct of financial planners
- qualities of a successful financial planner
- APS12 Statement of financial advisory service standards
- quality control requirements for accounting practices
- charging for financial planning services
- ethical issues
Module 2: The financial planning process
- the Statement of Advice (SOA)
- developing a SOA
- preparing a SOA
- key elements in the financial planning process
- regulatory requirements governing the preparation of the SOA
- presentation of the SOA
- reviewing the SOA
- additional statement of advice
- record of advice
- personal risk profile
Module 3: Risk insurance
- identifying and managing risks
- identifying risks
- retained and transferred risks
- the financial planner's role
- the life insurance industry in Australia
- types of risk insurance
- life insurance
- total and permanent disability (TPD) insurance
- income protection insurance
- trauma or critical illness insurance
- needs analysis and declaration requirements
- key person insurance
- business insurance agreements
- taxation issues
- lump sum compensation / settlement payments
- death and disability cover for superannuation fund members
- other types of insurance
Module 4: Personal tax planning
- remuneration planning
- why remuneration plan?
- overview of fringe benefits tax
- types of remuneration packages
- salary sacrifice
- packaging options
- non-deductible benefits
- deductible / non-FBT benefits
- otherwise deductible expenses
- concessionally taxed benefits
- rebatable employers
- tax issues
- low income rebates
- structures
- sole ownership
- partnership
- a private company
- a trust
- a self-managed superannuation fund
- choosing a structure
- small business CGT concessions
- 15 year exemption
- retirement exemption
- budgeting and debt management
- financial budgeting
- debt
- gearing benefits and risks
- margin lending
- reverse mortgage
Module 5: Investment planning
- the valuation of investment cash flows
- time value of money
- types of interest
- annuities
- perpetuity
- net present value
- the internal rate of return
- fixed interest securities
- discounted securities
- investment issues
- investment goals
- short term and long term investments
- liquidity and accessibility
- transaction costs
- taxation
- risk
- returns
- asset allocation
- strategies for client investment management
- factors to consider when investing money
- direct investments
- shares
- debt instruments
- investment property
- managed investments
- broad categories of managed investment products
- types of managed investments
- asset-specific funds
- superannuation funds
- investment management styles and structures
- investment management styles
- investment management structures
- alternative investment
- international investments
- hedge funds
- derivatives
- precious metals
- collectibles
- tax-driven investments
- research
- information sources
- research criteria
- interpretation of information
Module 6: An introduction to the superannuation industry
- government policy and superannuation
- role of superannuation in lifetime planning
- government policy and objectives
- an overview of superannuation providers
- regulations governing superannuation funds
- regulators and their roles
- regulatory legislation
- audit and reporting of superannuation funds
- regulator audits
- Superannuation Complaints Tribunal
- preparing financial statements for superannuation funds
- audit of superannuation funds
- taxation of superannuation funds
- taxation of fund income: general principles
- specific issues and concessions
- goods and services tax (GST) and superannuation funds
- payment of tax: PAYG system
- superannuation contributions tax (surcharge) collection mechanism
Module 7: Contributing to superannuation
- superannuation contributions
- employer contributions
- employer obligations and compulsory contributions
- superannuation guarantee and choice of fund requirements
- Superannuation Guarantee Charge (SGC)
- tax deductibility
- tax deductions for employers
- deductions of personal contributions
- other concessions and incentives for contributions
- co-contributions
- spouse contributions
- undeducted (non-concessional) contributions
Module 8: Termination and retirement benefits
- superannuation and termination payments
- superannuation payments
- components of superannuation benefit
- calculation of superannuation components from 1 July 2007
- calculation of crystallised pre-July 1983 components as at 30 June 2007
- applying the proportionate rule
- taxation of superannuation benefits to a member post 1 July 2007
- employment termination payments
- procedures for payment of termination payments
- genuine redundancy and early retirement scheme payments
- payment other than employment termination payments
- superannuation and family law
- retirement planning and benefits
- pension and annuity income streams
- account-based income streams
- advantages and disadvantages of accounts based pensions (ABPs)
- non-account based pensions
- account-based pensions post 1 July 2007
- allocated pensions (APs)
- maximum and minimum payments from allocated pensions existing pre July 2007
- term allocated pensions (TAPs)
- taxation of income streams
- taxation of income streams commencing on or after 1 July 2007
- transitional taxation arrangements for pre 1 July 2007 income streams
- trigger events and proportioning
- strategies
- re-contribution strategy
- ATO opinion
- transition to retirement
Module 9: Estate planning
- introduction to estate planning
- developing an estate plan
- estate assets
- non-estate assets
- wills
- intestacy
- trusts
- superannuation
- superannuation death benefits payments
- dependants
- death benefit eligible termination payments
- taxation considerations in estate planning
- capital gains tax (CGT)
- business succession
- power of attorney
- guardianship
Module 10: Social security
- life expectancy and population projection
- the social security system
- pensions, allowances, benefits and payments
- de facto relationships
- new arrivals (immigrants)
- payments to families with children
- Family Tax Benefit
- Child Care Benefit
- other payments delivered through the Family Assistance Office (FAO)
- payments delivered through Centrelink
- income support for the retired
- age pensions
- wife pension
- income support for those of workforce age
- unemployed people
- disabilities and the sick
- special social security payments and entitlements
- social security services
- assets and income tests
- pension incomes and asset test
- allowance income and income test
- deeming provisions
- disposal / gifting of assets
- superannuation funds, rollovers, annuities and social security
- assessment of income streams
- compensation and social security
- bereavement payments
- Department of Veterans' Affairs
- fringe benefits
- pension concession card
- healthcare card
- Commonwealth senior's health card
- pharmaceutical allowances
- senior concession allowances
- utilities allowances
- investment strategies for DFCS / DVA pensioners
- estate planning
- pension strategies
Module 11: Sample statement of advice
- statement of advice: covering letter
- statement of advice
- authority to proceed
- annual review
