FAE · ASIC Financial Adviser Exam
Lesson 2 of 3 in Advice and disclosure: FSG, SOA, PDS and warnings
The Part 7.7 rules on when a Financial Services Guide, Statement of Advice or record of advice is due, what each must contain, the exemptions, and what follows when one is missing or defective.
Financial advice regulatory and legal obligations9 min read8 sections
Explained in full: Statement of Advice requirements
Checked against: Corporations Act 2001 (Cth), compilation No. 149 (19 Sep 2026): ss941A-941D, 941F, 942B, 942C, 943G, 943H, 943K, 943L, 944A, 946A, 946AA, 946B, 946C, 947B-947D, 951A, 952B-952E, 953B; endnotes (Division 2A added by Act No. 67, 2024, commenced 10 July 2024); Corporations Regulations 2001, compilation No. 214 (1 Sep 2026): regs 7.7.09, 7.7.09A, 7.7.10AE, 7.7.10AF(3); ASIC Financial adviser exam: Exam preparation guidance v6.0 (Sept 2026).. Independent prep, not endorsed by ASIC.
ASIC's curriculum asks you to apply Chapter 7 to key advice documentation, evaluate case studies to identify breaches of the disclosure obligations, and work out the consequences of those breaches for the adviser, the client and the industry. The reading list names Part 7.7 of the Corporations Act, RG 175, RG 90 (example SOA) and INFO 266 on records of advice (Exam preparation guidance v6.0, Sept 2026).
Statutory extracts are supplied with questions, so the skill is applying them to a timeline. Our practice questions give you a client file and ask which document was due at a step, whether it arrived in time, and whether it contained what the section requires.
The FSG describes the provider, not the advice. It is due for any financial service to a retail client, including dealing, not just advice (ss941A, 941B). It must reach the client as soon as practicable once a service is likely, and before the service (s941D(1)).
| Situation | Rule | Source |
|---|---|---|
| Client already holds an FSG with all the required information | No new FSG | s941C(1) |
| Service is financial product advice and website disclosure information is available in time | No FSG; the website information must stay readily accessible, up to date and dated | ss941C(5A), 943K, 943L |
| General advice to the public in a prescribed manner | No FSG, but name, remuneration and associations information first | s941C(4)-(5) |
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Case study FAE-C179, question 4 of 8: Bianca and Theo: from seminar to SOA. Bianca Russo, 52, is a hospital pharmacist in Hobart earning A$128,000. Her husband, Theo, 55, is a self-employed builder whose income varies between A$70,000 and A$110,000 a year. They own their home, worth about A$780,000, with a A$95,000 mortgage, and hold A$60,000 in savings. Bianca has A$310,000 in super in a high-growth option; Theo has A$140,000. They want the mortgage gone and to retire at about 62. Bianca calls herself 'balanced but nervous'; Theo says he 'leaves the money side to Bianca'. Jarrah Collins, 39, is a relevant provider and an authorised representative of only one AFS licensee, Wattlebird Wealth Pty Ltd. Wattlebird gives clients a printed Financial Services Guide and does not use website disclosure information. Jarrah earns a salary plus a bonus based on new client numbers, and he finds clients through free seminars that Wattlebird runs and an Instagram account where he posts short market commentary. In August Bianca and Theo attended Jarrah's Wattlebird seminar, 'Ten years to retirement', where every attendee was handed Wattlebird's current FSG. In September they book a first meeting. Jarrah completes a full fact-find with both of them and recommends that Bianca switch her super to a balanced option and invest A$50,000 of their savings, in her name, in new units in the Greenhaven Balanced Fund, a liquid registered managed investment scheme, issued by an unrelated fund manager, that processes withdrawals daily. Wattlebird's paraplanners prepare SOAs from a licensee template that its compliance team maintains. At the September meeting Jarrah is about to give Theo his first personal advice. Theo received Wattlebird's current FSG at the August seminar, and nothing in it has changed. A colleague insists that a fresh FSG must be handed over first. Before advising Theo, Jarrah…
| Issuer dealing only in its own products | No FSG; PDS rules apply instead | s941C(2) |
| Client expressly instructs that the service be immediate or by a set time, and the FSG cannot practicably be given first | Statement of remuneration, associations and other key information first, then the FSG | s941D(2)-(4) |
| FSG goes out of date in a materially adverse way before the service | New FSG, Supplementary FSG, or website disclosure information, before the service | s941F |
In the time-critical case the Act says the FSG follows within 5 days of the statement (s941D(4)); reg 7.7.10AF(3) modifies that to 5 business days. Either way, sooner if practicable.
The website route commenced on 10 July 2024 (Division 2A, added by Act No. 67 of 2024) and covers advice only. An authorised representative needs its licensee's authorisation to distribute an FSG or publish website disclosure information (ss941B(2), 943H(3)).
FSG content under s942B(2) (s942C(2) for an authorised representative):
Answer: A. need not give him another, since his FSG already holds all the required information
Answer: Need not give him another, since his FSG already holds all the required information. An FSG need not be given if the client has already received one containing all the information the new FSG would have to contain (s941C(1)).Why not the others:• must give him a new FSG, because the seminar copy was given for general advice only: an FSG describes the entity's services, remuneration and dispute resolution generally and is not issued separately for general and personal advice.• must give him a Supplementary FSG confirming…: a Supplementary FSG exists to correct or update an FSG (s943A), and nothing needs updating.• need not give him one, as an FSG is needed only for the first client in a couple: each client must have the information, so the exception turns on what Theo himself received, and his wife's copy would not have covered him.Rule: The purpose of the s941B duty is already met where this client holds a current FSG with all the required information, so no fresh copy is needed for this service.Source: Corporations Act 2001 (Cth) ss941B, 941C, 943A (compilation No. 149, 19 Sep 2026)
Case study FAE-C06, question 5 of 5: Ming's employer super choice. Ming, 29, is a single software engineer at a Brisbane technology company, earning A$132,000. She rents, has A$40,000 saved towards a home deposit she hopes to use in about five years, and has no debts. Her A$96,000 of super sits in her employer's default MySuper product, a lifecycle option, with default death and TPD cover through the fund. She makes no extra contributions. Ming asks Callum, an employed adviser and relevant provider at Harbourline Advice, an AFS licensee, whether she should leave MySuper for a choice investment option in the same fund with more growth assets. Harbourline charges flat fees, receives no product commissions or volume-based payments, and has no ownership links to any fund. It does not hand out FSGs; it keeps website disclosure information on its website. At their meeting Callum discusses Ming's goals and her tolerance for risk, which she describes as high for super she cannot touch for 30 years. He recommends the fund's high-growth option and says he will send the SOA 'in a couple of weeks'. Ming asks him to submit the switch form straight away so she can 'catch the current market dip'. Ming reads online that advisers must give an FSG before advising and asks Callum why she never received one. Harbourline's website disclosure information was on its website, up to date, well before their first meeting, and no FSG was given. Harbourline's position is BEST described as…
Answer: C. compliant: no FSG was needed, as the website information was available in time
Answer: Compliant: no FSG was needed, as the website information was available in time. Under s941C(5A), no FSG is needed for financial product advice if, by the time it would be due, the entity has made website disclosure information available on its website and has not given the client an FSG.Why not the others:• in breach: website disclosure replaces an FSG only for general advice: The website route covers financial product advice of either kind, personal or general.• in breach: a new client must always be handed an FSG before personal advice: Ming's reading reflects the law before 10 July 2024, when handing over an FSG was the only route.• compliant: no FSG is needed where a licensee receives no commissions: Harbourline's fee model has nothing to do with the FSG obligation.Rule: Website disclosure information must contain what an FSG would, stay readily accessible, and be kept up to date and dated (ss943G-943L).Source: Corporations Act 2001 (Cth) ss941C(5A), 943G-943L (compilation No. 149, 19 Sep 2026); ASIC INFO 291 FAQs: FSGs and website disclosure information (updated Dec 2025)
Case study FAE-C04, question 2 of 5: Nadia and Sam: first appointment. Nadia, 38, a hospital nurse earning A$98,000, and Sam, 41, a civil engineer earning A$142,000, live in Geelong with their two children, aged 6 and 9. Their home is worth about A$900,000, with a A$480,000 mortgage. They have A$25,000 in savings; Nadia has A$110,000 in super and Sam A$185,000, both in industry funds with default cover only. Their accountant refers them to Leah, an authorised representative of Brightpath Advice and a relevant provider. Brightpath does not use website disclosure information; it gives every client a printed FSG. The couple want to pay off the mortgage faster, put proper life insurance in place and decide whether Sam should salary sacrifice. Their risk profile is balanced. At the first meeting Leah completes a full fact find, then gives them Brightpath's FSG as the meeting ends and explains her fees. Two weeks later she presents an SOA recommending higher mortgage repayments, A$1.2 million of life cover each through a retail insurer that pays Brightpath commission, and salary sacrifice of A$8,000 a year for Sam. She tells them the insurance commission is 'standard and built into the premium'. The SOA states the commission as a percentage of the premium, but not in dollars. Before the SOA is presented, Brightpath's compliance officer checks how it shows the insurance commission. Leah argues that a percentage of the premium is clearer for clients than a dollar figure. Which statement BEST describes the problem with the disclosure?
Answer: B. Influencing remuneration must be stated in dollars unless the regulations allow otherwise
Answer: Influencing remuneration must be stated in dollars unless the regulations allow otherwise. As an authorised representative, Leah must disclose remuneration, including commission, that might reasonably be expected to influence the advice, and state the amounts in dollars (s947C(2)(e), (i)).Why not the others:• Insurance commission need not appear in an SOA…: Who pays the commission does not remove the duty to disclose it.• Commission belongs in the FSG; the SOA only needs to show the adviser's own fee: The FSG describes remuneration in general terms; it does not replace the SOA's advice-specific disclosure.• A percentage is acceptable only if the insurer's PDS is given with the SOA: Giving the PDS does not turn a percentage into a dollar amount.Watch out: Leah's preference may feel client-friendly, but the dollar rule decides; a percentage is allowed only where ASIC has determined there is a compelling reason, and nothing suggests that here.Rule: Sections 947B(2)(d), (h) (licensees) and 947C(2)(e), (i) (authorised representatives) require influencing remuneration in dollars unless the regulations and an ASIC determination allow otherwise (reg 7.7.10A; for authorised representatives, regs 7.7.12-7.7.13).Source: Corporations Act 2001 (Cth) ss947B(2), 947C(2) (compilation No. 149, 19 Sep 2026); Corporations Regulations 2001 (Cth) regs 7.7.10A, 7.7.12, 7.7.13 (compilation No. 214, 1 Sep 2026)
Case study FAE-C34, question 4 of 4: Ravi's term deposit question. Ravi, 31, an IT support analyst earning A$84,000, rents a flat in Parramatta with his fiancée, Ana. He has A$6,000 in an everyday account, A$52,000 in super and a car loan of A$14,000 at 8.9% a year. He also holds A$7,500 in the Northbank Growth Fund, a managed fund issued by Northbank's funds management arm. Ravi rings Northbank Advice, a bank-owned AFS licensee, and asks for personal advice on where to put a A$9,000 bonus: a Northbank term deposit, his existing managed fund, or extra repayments on the car loan. He says he will need the money for his wedding in 10 months. The adviser, Dana, a salaried relevant provider, recommends adding the A$9,000 to the Northbank Growth Fund and, at Ravi's request, arranges the investment during the call. She does not give Ravi an SOA, telling him the amount is 'too small to need one', and she sends him nothing in writing. Her file holds a two-line note of the call. Two weeks later the fund has fallen 4%, and Ravi rings to ask how he can get his money back. In a file review, Dana's manager says that because no SOA was needed, Dana did not have to tell Ravi anything about her remuneration or about Northbank's link to the fund's issuer. The manager's view is…
Answer: B. wrong: Ravi had to be told of her remuneration and Northbank's interests when advised
Answer: Wrong: Ravi had to be told of her remuneration and Northbank's interests when advised. Small investment relief removes the SOA only.Why not the others:• correct: small investment advice is exempt from every Part 7.7…: s946AA(4) to (6) still require a record and a copy of it with the SOA's remuneration and interests information (s947B(2)(d) and (e) or s947C(2)(e) and (f)).• correct, provided the same information is in Northbank's FSG…: an FSG describes remuneration in general terms and does not replace the advice-specific disclosure.• wrong: Ravi was entitled to a full SOA once Dana arranged the investment the same day: same-day implementation does not bring back the SOA.Watch out: If the record is not given with the advice, reg 7.7.09A(11) requires that information at that time; Dana gave nothing, and Northbank's link to the fund's issuer is exactly what it must cover.Rule: Advice within the A$15,000 threshold needs no SOA; the record may follow the advice (in a time-critical case, within 5 days after the further service: reg 7.7.09A(10) to (12)), but the conflict disclosure cannot be skipped.Source: Corporations Act 2001 (Cth) ss946AA, 947B, 947C (compilation No. 149, 19 Sep 2026); Corporations Regulations 2001 (Cth) reg 7.7.09A (compilation No. 214, 1 Sep 2026)
Case study FAE-C06, question 1 of 5: Ming's employer super choice. Ming, 29, is a single software engineer at a Brisbane technology company, earning A$132,000. She rents, has A$40,000 saved towards a home deposit she hopes to use in about five years, and has no debts. Her A$96,000 of super sits in her employer's default MySuper product, a lifecycle option, with default death and TPD cover through the fund. She makes no extra contributions. Ming asks Callum, an employed adviser and relevant provider at Harbourline Advice, an AFS licensee, whether she should leave MySuper for a choice investment option in the same fund with more growth assets. Harbourline charges flat fees, receives no product commissions or volume-based payments, and has no ownership links to any fund. It does not hand out FSGs; it keeps website disclosure information on its website. At their meeting Callum discusses Ming's goals and her tolerance for risk, which she describes as high for super she cannot touch for 30 years. He recommends the fund's high-growth option and says he will send the SOA 'in a couple of weeks'. Ming asks him to submit the switch form straight away so she can 'catch the current market dip'. Callum's paraplanner thinks the SOA needs no replacement-advice section, since Ming will stay in the same fund and Harbourline earns no commission on either option. Does s947D apply to Callum's recommendation?
Answer: C. Yes: it covers a switch from MySuper to a choice option in the same fund
Answer: Yes: it covers a switch from MySuper to a choice option in the same fund. Section 947D(1)(b) applies where advice recommends reducing an interest in a MySuper product of a regulated superannuation fund and acquiring an interest in another MySuper product or a choice product offered by the same fund.Why not the others:• No: s947D does not apply when the licensee receives no commission on either product: Remuneration is not a condition of s947D.• No: s947D applies only when money moves between two different super funds: The paraplanner's instinct fits s947D(1)(a), which deals with replacing one product with another, but paragraph (b) captures exactly this switch.• Yes, for the fee comparison, though lost benefits need not be disclosed: There is no fee-only version, because lost benefits are part of what must be disclosed.Rule: Callum's SOA must disclose any charges, any benefits Ming may lose (for example insurance terms tied to the default option) and other significant consequences, in dollars unless the regulations allow otherwise (s947D(2)).Source: Corporations Act 2001 (Cth) s947D (compilation No. 149, 19 Sep 2026)
