Samantha Carroll talks to BRR Media about the challenges in FOFA implementation

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FOFA mandatory compliance has commenced

Kate Ritchie, BRR Media

Samantha Carroll, Special Counsel, Clayton Utz

We're joined by Samantha Carroll who's a Special Counsel in the Governance and Compliance Group at Clayton Utz and joins us from Brisbane; Samantha welcome to BRR Media.

Thanks Katie.

Now Samantha mandatory compliance for FOFA of course commenced on 1 July. Is there a sense that the industry is well prepared?

Generally many licensees undertook significant implementation projects in-house, so it's difficult for us to comment holistically on the industry, but in general terms from the people that we dealt with there appears to be a readiness for FOFA on 1 July.

And Samantha what do you see as the key issues facing AFS licence holders or Australian Financial Services licence holders in relation to governance risk and compliance?

For us there's probably four key issues. The first in general terms would be monitoring and supervision, particularly in the context of the best interest duty and the need to maintain quality advice. And in that context specifically we think there's a challenge in balancing advisers showing evidence of independent judgment in the advice they're providing to their clients whilst maintaining the quality that's required under the duty. And we also think there's a challenge in ensuring that adequate file records are kept for each client and particularly for evidentiary purposes down the track. And finally maintaining compliance in an area of increasing regulation is a challenge as well.

Well as we mentioned of course mandatory compliance has been in since 1 July, but are there any last minute tips?

At this point in time it's probably a good idea to undertake a bit a health check on your implementation projects and see where you may need to back fill some tasks that you didn't quite get around to before the 1st of July that were less material for the commencement. And then we would recommend probably in six to 12 months' time undertaking an implementation check to ensure that what you have implemented is working in practice.