Financial Services, Regulation and Ethics

LIBF Info

DiPFA – Diploma for Financial Advisers

DiPFA – The Diploma for Financial Advisers is an FCA-approved QCF Level 4 qualification; it is one of the benchmark qualifications to become a Financial Adviser. DiPFA also meets the Retail Distribution Review (RDR) requirements that came into effect on 31st December 2012 and applies to all advisers in the retail investment market, regardless of the type of firm they work for. RDR was designed to raise Professional standards and to increase consumer confidence in the retail investment market. Whether independent or restricted, advisers are required to demonstrate a higher level of knowledge and skills. The qualification structure will ensure that advisers achieve a greater level of professionalism, with higher level qualifications, enhanced standards of Continued Professional Development (CPD) and adhering to ethical standards.

On completion of the LIBF Diploma, qualified professionals can go on to work in financial services as a financial adviser, giving advice on investments through to retirement planning. This qualification only takes 9 months to complete, offering a direct route into the finance industry. DipFA® is a professional qualification (level 4), but without the hefty course fee attached.

The DiPFA® qualification comprises of 6 modules and contains 11 units. Each unit must be passed to achieve the full qualification. If a student fails any of the units they are only required to re-sit the failed unit. The modules can be taken in any order and will take approximately 9 months to complete. The exam structure of each module is as follows:

Module 1: Financial Services, Regulation and Ethics – FSRE (Units 1 and 2) – Skill: Understanding Regulation (Exam: Two hour multiple-choice exam (1 hour each):

FRE1: Industry, Regulation and Key Parties
FRE2: Skills, Principles and Ethical Behaviours
- 25 multiple-choice questions (on each unit)
- 3 case studies with 5 linked multiple-choice questions on each unit
- Total marks = 80 marks (70% pass mark on both units)

Overview: FSRE® is the regulatory foundation module required for any professional qualification. The module helps candidates understand how financial markets and products work. It covers:

Financial Services – by looking at the financial services industry and regulated financial products
Regulation – by looking at how UK financial services are regulated and the role and objectives of the regulators
Ethics – by looking at how regulation can encourage ethical behaviour in firms and those who work in the firms, as well as the qualities and personality traits required for those who work in certain roles.

Modules 2 to 5: Skills: Technical knowledge and understanding.

Module 2 – Taxation (Units 3 and 4) Skill: Understanding taxation (Exam: 90 minute multiple-choice exam (45 minutes each unit).

Overview: Module two – Advanced Financial Advice – Taxation (AFAT)

This module will cover direct and indirect taxes, how they are calculated, who is liable for taxation and when taxes are due. The taxation module will explore the current HMRC structure of taxation including domicile and residency, estate planning and how advisers can assist clients in tax planning.

Module 3 – Investments (Units 5 and 6) Skill: Understanding how investments work and their uses (Exam: 90 minute multiple-choice exam (45 minutes each unit).

Overview: Module three – Advanced Financial Advice – Investments (AFAI)

This module will cover how economic policy can impact financial markets and the use and suitability of the vast range of financial assets and financial products. This module will also cover the different investment theories and risks associated in this financial planning stage.

Module 4 – Protection (Units 7 and 8) Skill: Understanding how financial protection products work and their uses (Exam: 90 minute multiple-choice exam (45 minutes each unit).

Overview: Module four – Advanced Financial Advice – Protection (AFAP)

This module will explore why and how financial protection can be implemented to ensure that a client’s needs are met. It will explain how protection can protect a client’s dependents as well as themselves in the event of early death, sickness or unemployment. It will cover how state benefits are limited but can also impact financial advice. This module will cover the technical aspects of all the protection policies and how an adviser can structure the policies and identify when changes need to be made to ensure ongoing suitability.

Module 5 – Retirement Planning (Units 9 and 10) Skill: Understanding how state and non-state pensions work in order to help clients plan for retirement (Exam: 90 minute multiple-choice exam (45 minutes each unit).

Overview: Module five – Advanced Financial Advice – Retirement Planning (AFAR)

This module will look at state pensions by looking at how they work and the qualification criteria, as well as how they can form part of the overall financial wellbeing of the client. It will also cover work and private pensions and the tax regime applicable in order to properly advise clients during the accumulation phase including how much and where to invest to achieve an income in retirement. It will cover the vast area of technical knowledge required to understand all types of pensions as well as the decumulation phase and the various options on retirement and how they can be built into a clients financial planning.

All modules 2 to 5 are assessed in a 90 minute exam and will cover 2 units in each module (45 minutes each unit). Each exam are multiple-choice. On each unit there are:

20 multiple-choice questions
2 case studies with 5 linked multiple-choice questions on each
Total marks on each unit = 30 marks (60 marks in total per module)
70% pass mark on each unit

Each unit must be passed on its own. Any failed units can be attempted again and only the failed unit would need to be re-taken.

Module 6 – Coursework (Unit 11) Skill: The application of the knowledge gained in modules 1 to 5. Exam = 1 unit – A coursework consisting of a pre-released fact find with an essay response in the style of a suitability report. Students are given 4 weeks to complete their report and submit it online.

Overview: Module six – Advanced Financial Advice – Coursework

The final module looks at applying the knowledge gained in the previous modules and testing the ability to formulate the knowledge via a suitability report. This is based on a case study provided as a fact find given 4 weeks before. Students must formulate their recommendations via a report and submit it online within the time frame. A new fact find is released every 6 weeks.

Total marks = 240 marks (50% pass mark)

During your studies you will become a Member of LIBF (MLIBF). LIBF membership offers benefits such as career support and access to professional networking events.