We received a fair amount of all kinds of calculations, based on the FSB statistics. One that differed from the rest considered the financial impact on the FSB’s income, should the pass rate reflected in the statistics be applied to the total numbers.
Angus writes as follows:
A closer look at the results of the RE exams as per FSB media release reveals a rather disturbing consequence that will probably affect all the FSPs, KIs and Reps that have gone to the trouble of writing and passing the RE exams:
Presuming that the same percentages apply to those that still have to write pass/fail:
1. 49,166 Reps out of 107428 will not be paying the FAIS levy – say R250 (minimum) – this translates into R9,833,345 that the FSB will not be receiving for 2013.
2. 4823 Key Individuals out of 13839 will not be paying the FAIS levy – say R430 (minimum) – this translates into R2,073,890 – but this could be higher as many FSP’s may also not be contributing.
So…. the FSB could be short of R11,907,235 for next year from FAIS levies.
Will they reduce staff (as the workload will now be somewhat (42%) less or increase all the levies payable? Will this turn out to be another example where those that have followed the law will be landed with paying the price?
We had better start chirping now!
Whilst we believe in relying on facts, rather than conjecture, this is certainly a consideration to bear in mind, given the increase in the cost of running a practice over the last few years. We believe that, in the event of such an outcome, there will not be a reduction of staff at the regulator, but rather increased application of the requirements through closer scrutiny and control by the FSB. The biggest losers in case of such a scenario will be the consumers of financial products, as their access to advice and services will be severely curtailed. Hopefully this realisation will set in sooner, rather than too late.