FASEA Professional Ethics and Standards 4

Question 1

Under the FASEA Code of Ethics, 'independence' in Standard 4 is BEST understood as:

Accepted Answer

Freedom from bias, conflicts, and undue influence when providing advice

Answer

Independence under FASEA Standard 4 refers to freedom from conflicts and bias in judgment, not to a business structure requirement.

Question 2

When must a financial adviser prioritise a client's long-term interests over their stated short-term preferences under the FASEA framework?

Accepted Answer

When the short-term preference would cause significant foreseeable harm to the client's long-term financial wellbeing

Answer

The best interests duty requires advisers to consider long-term wellbeing, which may mean advising against a client's stated preference when it is harmful.

Question 3

The FASEA Code of Ethics applies to financial advisers who provide:

Accepted Answer

Personal financial product advice under an AFSL

Answer

The FASEA Code applies specifically to advisers providing personal financial product advice under an Australian Financial Services Licence.

Question 4

An adviser's professional competence obligation under FASEA includes which of the following?

Accepted Answer

Completing an approved exam and relevant CPD annually

Answer

FASEA required advisers to pass an approved exam and undertake annual CPD to demonstrate and maintain competence.

Question 5

Which of the following BEST describes the relationship between the FASEA Code of Ethics and the Corporations Act 2001?

Accepted Answer

The Code operates alongside and in addition to the legal obligations in the Corporations Act

Answer

The FASEA Code adds an ethical layer on top of existing legal requirements; compliance with law does not automatically satisfy the Code.

(FASEA) Financial Adviser Standards and Ethics Authority Practice Test

(FASEA) Financial Adviser Standards and Ethics Authority Practice Test

FASEA Professional Ethics and Standards 4