← Study index · ← Cheat sheet (digest)RES5 — Rules, Ethics and Skills for Financial Advisory Services — Full Facts
Chapter 4 · every fact by topic · 77 source facts
Priority — core important supporting
🤝Introducers Applicability
FAA-N02: who the Notice binds and what 'introducing activity' is.
- 'Introducing activity' means introducing any client to an introducee in relation to the provision of a financial advisory service by the introducee, optionally together with recording and forwarding the client's particulars (with the client's consent) and/or providing factual information to the client on investment products. — p. 4A-2
⚠ Introducing = connecting client to introducee + factual info only; NOT advising, recommending, marketing CIS or arranging life policies.
- Notice FAA-N02 is issued under Section 58 of the FAA and applies to all licensed financial advisers and persons exempt from holding a financial adviser's licence under Section 23(1)(a), (b), (c), (d) or (e) of the FAA. — p. 4A-2
⚠ Binds the appointing FA and s23(1)(a)-(e) exempt persons - not the introducer directly.
- The factual information an introducer may provide to a client on an investment product includes the name of the investment product, the product provider, the launch date, the minimum subscription amount, and any fee or charge that may be imposed. — p. 4A-2
⚠ Factual product data only (name, provider, launch date, min subscription, fees) - no opinion or suitability.
🧭Introducers Appointment Controls
FAA-N02: reasonable steps on appointment and control systems over introducers.
- A financial adviser engaging an introducer must institute adequate control systems and procedures to ensure the introducer's proper conduct, including ensuring the introducer does not get involved in providing any financial advisory service beyond carrying out introducing activities, and must ensure none of its employees or representatives arranges introducing activities with an introducer other than on the adviser's behalf. — p. 4A-3
⚠ Introducer must never stray into providing a financial advisory service - only introducing activities.
- A financial adviser should take reasonable steps not to appoint an introducer whose carrying out of introducing activities is, if the introducer is a corporation, its sole business activity, or, if the introducer is an individual, his full-time occupation. — p. 4A-3
⚠ Avoid introducers for whom introducing is the SOLE business (corporation) or FULL-TIME occupation (individual).
📋Introducers Conduct Requirements
FAA-N02: written agreement, disclosure, script, no client money, register, and the employee carve-out.
- A financial adviser must enter into a written agreement with the introducer that clearly spells out the scope of introducing activities to be carried out, and must monitor the introducer to ensure it operates within the terms and conditions of that agreement. — p. 4A-3
⚠ Written agreement (B1) is disapplied when the FA's OWN employees/reps introduce on its behalf.
- A financial adviser must require the introducer (or its own employee/representative acting as introducer) to disclose to all clients that, when carrying out introducing activities, the introducer is not permitted to give advice or recommendations on any investment product, market any collective investment scheme, or arrange any contract of insurance for life policies, other than to the extent of introducing activities. — p. 4A-3, 4A-5
⚠ The introducer must tell clients up front what it CANNOT do (no advice, no CIS marketing, no life-policy arranging).
- A financial adviser must ensure that the introducer (or its employee/representative acting as introducer) does not receive or deal with any client's money or property in relation to carrying out introducing activities. — p. 4A-4, 4A-6
⚠ Absolute bar - an introducer must not touch client money or property, with no consent or trust-account exception.
- A financial adviser must maintain a register of the introducers it appoints containing their names, places of business, contact numbers, business registration numbers (or, for individuals, identity card numbers), and dates of appointment and (where applicable) termination. — p. 4A-4
⚠ Register (B5) is disapplied when the FA's own employees/reps introduce on its behalf.
- A financial adviser must require the introducer to disclose to all clients whether or not it is or will be remunerated by the adviser for carrying out introducing activities, the amount of that remuneration if the client so requests, and that the introducer is carrying out introducing activities for the financial adviser. — p. 4A-3, 4A-4
⚠ Fact of remuneration: always disclosed. Amount: only if the client asks.
- A financial adviser must provide a script to the introducer (or its employee/representative acting as introducer) specifying the information required to be disclosed under Regulation 31 of the FAR, the factual information to provide about the financial adviser, and the factual information on the investment products to which the introducing activities relate. — p. 4A-4, 4A-5
⚠ The FA provides the script; it contains disclosures + factual info only.
- Where introducing activities are carried out by a financial adviser's own employees or representatives on its own behalf, paragraphs 1.6 and 1.7 and Sub-sections B1 (written agreement) and B5 (register of introducers) do not apply; but the disclosure (B6), script (B7) and no-client-money (B8) requirements still apply. — p. 4A-5
⚠ For employee/rep introducers only the written agreement (B1), register (B5) and appointment controls (1.6-1.7) fall away - disclosure, script and no-client-money still bind.
💡In context
A script, not a sales pitch
The introducer regime works because the role is deliberately hollow: an introducer passes factual information from the adviser's script, tells the client what it is and is not allowed to do, discloses whether it is paid, and never touches client money or property. The moment any of that stops being true, the person is no longer introducing — they are advising without the licence to do so.
🚷Exempt Person Representations
FAA-N10: Reg 27(1)(d) exempt persons, the 30-accredited-investor limit, and the prohibited MAS-status representation.
- For the purposes of FAA-N10, an 'exempt person' means a person exempted from holding a financial adviser's licence under Section 23(1)(f) of the FAA read with Regulation 27(1)(d) of the Financial Advisers Regulations. — p. 4B-2
⚠ This Notice's 'exempt person' is specifically the s23(1)(f) + Reg 27(1)(d) accredited-investor exemption.
- The exemption from holding a financial adviser's licence applies where advice is given on any investment product (other than life policies) to not more than 30 accredited investors on any occasion.30 accredited investors — p. 4B-2
⚠ 30 ACCREDITED investors, per OCCASION, products OTHER THAN life policies - each qualifier is a trap.
- An exempt person and its representatives must not represent, or cause to be represented, that it is licensed, regulated, supervised or registered by the MAS, whether verbally or in writing. — p. 4B-2
⚠ Cannot claim to be licensed, regulated, supervised OR registered by MAS - verbally or in writing.
- Notice FAA-N10 is issued under Section 58 of the FAA and sets out certain prohibitions on representations made by exempt persons and their representatives regarding their exempt status. — p. 4B-2
⚠ FAA-N10 is about how exempt persons may (not) describe their status - not about licensing or exams.
- By virtue of Section 23B(1)(b) of the FAA, individuals providing financial advisory services as representatives of exempt persons are exempted from having to act as appointed or provisional representatives (under Sections 23C or 23D) when giving advice on any investment product (other than life policies) to not more than 30 accredited investors on any occasion. — p. 4B-2
⚠ Reps of exempt persons ride the same 30-accredited-investor / no-life-policies boundary.
🧠Memory hook
Thirty on one occasion
An exempt person's cap under FAA-N10: no invitation to more than 30 accredited investors on any single occasion. Thirty — the same number the exam likes to nudge to 20 or 50.
🛂Provisional Rep Entry
FAA-N12: the notification framework and the four minimum entry requirements for a provisional representative.
- The principal must ensure that any individual proposed to be a provisional representative is at least 21 years old.21 years — p. 4C-3
⚠ Age 21 is one of four entry requirements - all four must be satisfied.
- The principal must ensure that any individual proposed to be a provisional representative possesses at least three years of working experience relevant to the type of financial advisory service he will provide.3 years — p. 4C-3
⚠ 3 years' RELEVANT experience - general work experience does not count.
- To be a provisional representative, an individual must satisfy all four entry requirements of FAA-N12 paragraph 1.6: be at least 21 years old; be in the process of relocating, or have relocated, to Singapore; possess at least three years of working experience relevant to the financial advisory service to be provided; and possess at least a Bachelor's degree or equivalent, or a professional qualification. — p. 4C-3
⚠ All four must be met, and CMFAS exams come AFTER entry (the point of the scheme) — do not confuse with the appointed-representative entry requirements (FAA-N26).
- Notice FAA-N12 is issued under Sections 23D and 58 of the FAA and sets out the entry requirements for, and the validity period of, the appointment of provisional representatives. — p. 4C-2
⚠ FAA-N12 = entry requirements AND validity period of PROVISIONAL representatives.
- With the FAA amendments implemented on 26 November 2010, the licensing regime for representatives was replaced by a representative notification framework, under which a principal appointing a representative must notify the MAS of the appointment and certify the representative's fitness and propriety; this applies to appointing both appointed and provisional representatives. — p. 4C-2
⚠ Since 26 Nov 2010: principals NOTIFY and CERTIFY - representatives are no longer individually licensed.
- The provisional representative scheme facilitates the relocation of experienced individuals who wish to provide financial advisory services under the FAA; such an individual may act as a provisional representative while given a grace period to pass the relevant CMFAS examinations. — p. 4C-3
⚠ Scheme is for EXPERIENCED individuals RELOCATING to Singapore, given time to sit the exams.
- The principal must ensure that any individual proposed to be a provisional representative is in the process of relocating, or has already relocated, to Singapore. — p. 4C-3
⚠ Being in the PROCESS of relocating is enough - relocation need not be complete.
- The principal must ensure that any individual proposed to be a provisional representative possesses at least a Bachelor's degree or equivalent, or a professional qualification. — p. 4C-3
⚠ Bachelor's degree/equivalent OR professional qualification - required on TOP of the 3 years' experience.
- The MAS may refuse entry of a provisional representative who fails to satisfy the minimum entry requirements. — p. 4C-3
⚠ Entry is not automatic - MAS retains discretion to refuse where entry requirements are unmet.
- Principals should also ensure a proposed provisional representative was licensed, authorised or regulated as a representative for a comparable financial advisory service in a foreign jurisdiction for a continuous period of at least 12 months, and that no more than 12 months has elapsed between ceasing that foreign regulation and the proposed appointment.12 months — p. 4C-3
⚠ Two 12-month tests: at least 12 months regulated abroad, and a gap of no more than 12 months since ceasing.
🧠Memory hook
21, relocating, 3 years, a degree — then a 3-month clock
The four entry requirements for a provisional representative: at least 21 years old, relocating (or relocated) to Singapore, three years' relevant experience, and a degree or professional qualification. Meet all four and the reward is a three-month window, from entry on the register, to pass the CMFAS exams while already advising.
⏳Provisional Rep Validity
FAA-N12: three-month validity from register entry and the exams-before-notification rule.
- The appointment of a provisional representative is valid for a period of up to three months from the date when the representative's name is entered into the public register of representatives as a provisional representative.3 months — p. 4C-4
⚠ 3 months runs from ENTRY IN THE PUBLIC REGISTER - not from relocation, notification or appointment.
- Where a provisional representative intends to become an appointed representative for more than one type of financial advisory service, he must pass all the relevant examinations before his principal submits the one-time notification to the MAS in respect of those services. — p. 4C-4
⚠ ALL relevant exams first, THEN the principal's single one-time notification.
🚨Misconduct Reporting
FAA-N14: the four reportable misconduct types, the fraud/police path, cessation, and the 14-day report.
- A financial adviser must report to the MAS four types of representative misconduct: (a) acts involving fraud, dishonesty or similar offences; (b) inappropriate advice, misrepresentation or inadequate disclosure; (c) failure to satisfy the Fit and Proper Criteria (FSG-G01); and (d) other misconduct causing regulatory non-compliance or a serious breach of internal policy warranting demotion, suspension or termination. — p. 4D-2, 4D-3
⚠ Four categories: fraud/dishonesty; bad advice/misrepresentation/non-disclosure; fit-and-proper failure; other serious misconduct.
- A financial adviser must submit the Misconduct Report (Appendix 1 of FAA-N14) to the MAS through MASNET not later than 14 days after its discovery of the misconduct.14 days — p. 4D-3
⚠ 14 days from DISCOVERY (not from when the act occurred), lodged via MASNET.
- Notice FAA-N14 is issued under Section 58 of the FAA, applies to all licensed financial advisers and persons exempt under Section 23(1)(a) to (e), sets out advisers' responsibilities and reporting requirements for the misconduct of their representatives, and took effect from 1 January 2011.2011-01-01 — p. 4D-2
⚠ Effective 1 Jan 2011; covers the misconduct of REPRESENTATIVES, reported by the FA.
- For misconduct involving cheating, dishonesty, fraud, forgery, misappropriation of moneys or criminal breach of trust, the financial adviser is expected to lodge a police report and submit a copy to the MAS with the investigating officer's name and updates on the investigation; where it has not lodged a police report, it should notify the MAS of the reasons. — p. 4D-2
⚠ If no police report is lodged, the FA must still tell MAS WHY.
- A financial adviser must also report misconduct committed by a representative who has ceased to be its representative before the misconduct was discovered, or before disciplinary action was decided upon or taken. — p. 4D-3
⚠ Duty to report survives the representative leaving - discovery after cessation still triggers a report.
- Although meeting continuing education requirements is part of the fit and proper requirements, a financial adviser is not required to lodge a Misconduct Report against a representative for failing to meet the continuing education requirements. — p. 4D-3
⚠ Continuing-education failure is the express carve-out - no Misconduct Report needed for it.
❓Did you know?
Two 14-day clocks — one even for nothing
The Misconduct Report is due within 14 days of discovering the misconduct. But there is a second, easily forgotten 14-day clock: within 14 days after each 31 December, the adviser must declare to the MAS that there was nothing to report. Silence is itself a breach.
🗃️Misconduct Followup
FAA-N14: annual declaration, updates, investigations, disciplinary action and the s58(5) penalty.
- Under Section 58(5) of the FAA, a person who contravenes a requirement in a written direction issued by the Authority (which includes this Notice) is guilty of an offence and liable on conviction to a fine not exceeding $25,000 and, for a continuing offence, a further fine not exceeding $2,500 for every day the offence continues after conviction.25000 SGD — p. 4D-5
⚠ $25,000 + up to $2,500/day continuing - the same shape as the s67(5) penalty in FAA-N26.
- If there is no Misconduct Report required for a calendar year, the financial adviser must submit a declaration (Appendix 3 of FAA-N14) to the MAS through MASNET not later than 14 days after 31 December of that calendar year.14 days — p. 4D-3
⚠ Even a clean year needs a filing: nil declaration within 14 days after 31 December.
- A financial adviser is expected to conduct internal investigations and keep records of a summary of the facts, interviews with relevant parties (representative, supervisor, client), documentary evidence, the investigator's assessment and recommendation, and any disciplinary action taken, and must furnish these records to the MAS on request. — p. 4D-4
⚠ Keep the full investigation trail; furnish to MAS ON REQUEST (not automatically).
- The disciplinary action a financial adviser may take against a representative depends on the severity of the case and includes, but is not limited to, suspension from providing financial advisory services, restitution of misappropriated moneys, a fine, a formal warning, demotion, and termination of the representative's employment or arrangement. — p. 4D-5
⚠ Non-exhaustive menu graded to severity - suspension, restitution, fine, warning, demotion, termination.
- Where a financial adviser has not concluded its investigation or has not taken disciplinary action against the representative, it must submit an Update Report (Appendix 2 of FAA-N14) through MASNET to update the case as and when there is any significant development. — p. 4D-3
⚠ Update Report = triggered by significant developments, not a fixed calendar.
⚖️Bsc Overview
FAA-N20: applicability and key definitions (specified variable income, selected representative).
- Notice FAA-N20 is issued under Sections 38, 39 and 58 of the FAA and requires all licensed and exempt financial advisers to put in place, in their remuneration structures for representatives and supervisors, a balanced scorecard framework and an independent sales audit (ISA) unit. — p. 4E-3
⚠ Two mandatory limbs: the balanced scorecard framework AND the independent sales audit (ISA) unit.
- 'Specified variable income' means the proportion of a representative's (or supervisor's) variable income that is measured against the non-sales key performance indicators under the balanced scorecard framework. — p. 4E-3, 4E-4
⚠ Specified variable income = the slice of VARIABLE income measured against non-sales KPIs, not total pay.
- A 'selected representative' is a representative who has been assigned a balanced scorecard grade of B or worse for two calendar quarters immediately preceding the measurement quarter. — p. 4E-4
⚠ Selected rep = grade B or worse for TWO consecutive quarters before the measurement quarter (triggers higher sampling).
🕵️Bsc Isa Unit
FAA-N20: composition of the independent sales audit unit and outsourcing conditions.
- A financial adviser's ISA unit must comprise persons who are independent of the financial advisory services unit, do not directly or indirectly supervise or manage any representative, and are competent to review and assess the quality of financial advisory services against the non-sales KPIs and to determine whether infractions have been committed. — p. 4E-7
⚠ ISA unit = independent + not a supervisor of reps + competent to judge quality. All three.
- A financial adviser may use its compliance or risk management function, or outsource to a third-party provider, to carry out the ISA unit's responsibilities only if that function or provider satisfies the ISA independence and competence criteria and complies with the Notice's ISA-unit requirements. — p. 4E-7
⚠ Compliance/risk function or a third party may be the ISA unit - but only if it meets the same independence and competence tests.
🔍Bsc Sampling
FAA-N20: post-transaction check rounds, first-round sampling minimums and method-change notice.
- For the first round of post-transaction checks, the ISA unit must sample a minimum of 10% of the sampling population for a selected representative, 2% for a representative dealing only in rollovers of dual currency investments or structured notes (equities/commodities), and 5% for any other representative. — p. 4E-12
⚠ First round: 10% selected rep, 5% ordinary rep, 2% rollover-only rep.
- A financial adviser must apply the same method of determining the sampling population across all representatives and from quarter to quarter, and if it intends to vary the method it must notify the Authority in writing of the reason at least seven days prior to effecting the change.7 days — p. 4E-11
⚠ 7 days' PRIOR written notice to MAS to change the sampling method - not 14, and not after the fact.
- The ISA unit carries out up to three rounds of post-transaction checks for each representative for every calendar quarter, escalating to a further round only where one or more cases with infractions are found in the preceding round.3 rounds — p. 4E-11
⚠ Up to 3 rounds PER QUARTER; a later round is triggered only by infractions found in the previous round.
💡In context
Sampling that escalates on failure
The ISA unit's first-round sample is tiered by risk: at least 10% for a selected representative, 5% for other representatives, 2% for those dealing only in rollovers. Finding infractions triggers a further round, up to three per quarter — clean books keep the checks light; problems widen the net.
🏷️Bsc Infractions
FAA-N20: Category 1 vs Category 2 infractions.
📊Bsc Grading
FAA-N20: representatives' and supervisors' grading tables and grade-driven entitlement.
- Under the Representatives' Grading Table, the balanced scorecard grade is set by the percentage X (or number) of cases with infractions in a quarter: grade A (X<5%) gives 100% of specified variable income; B (5%-<10%) gives 75% to <100%; C (10%-<20%) gives 50% to <75%; D (20%-<30%) gives 25% to <50%; and E (X>=30%) gives 0% to <25%. — p. 4E-17
⚠ A<5%->100%; B 5-<10%->75-<100%; C 10-<20%->50-<75%; D 20-<30%->25-<50%; E >=30%->0-<25%.
- A representative is assigned grade E, entitling him to only 0% to less than 25% of his specified variable income, if he has one or more cases with a Category 1 infraction, regardless of the percentage of cases with infractions. — p. 4E-16, 4E-17
⚠ Even ONE Category 1 case => grade E, whatever the infraction percentage.
- Where, for a representative with only Category 2 infractions, the percentage of cases and the number of cases correspond to two different balanced scorecard grades, the financial adviser must assign the better of the two grades. — p. 4E-17, 4E-18
⚠ Two candidate grades (by % and by number) -> assign the BETTER one.
- Under the Supervisors' Grading Table, a supervisor's grade is set by the percentage of total specified variable income (from all supervised representatives) that the supervisor is entitled to: 75%-100% is Good, 50%-<75% is Satisfactory, 25%-<50% is Fair, and 0%-<25% is Unsatisfactory. — p. 4E-27
⚠ Supervisor grades are worded (Good/Satisfactory/Fair/Unsatisfactory), NOT lettered A-E.
- For a portfolio of transactions effected by a representative under his supervision, the supervisor is entitled to the same percentage of specified variable income as that representative is entitled to for that portfolio in the calendar quarter under the balanced scorecard framework. — p. 4E-25
⚠ Supervisor's % for a portfolio = the underlying representative's % for that portfolio.
🧠Memory hook
One Category 1 and the grade is E
The grading ladder runs A (infractions in under 5% of cases, 100% of specified variable income) down to E (30% or more, 0 to under 25%). But a single Category 1 infraction — material client impact or fitness-and-propriety — forces grade E regardless of the percentages. Only pure Category 2 cases get the benefit of the better of two grades.
💰Bsc Variable Income
FAA-N20: the 60% measurement, recovery, five-year records and MAS reporting.
- Where a representative is remunerated by variable income only, the financial adviser measures only 60% of that variable income against the non-sales KPIs; where the representative is on a fixed salary plus a variable income component, all of the variable income is measured against the non-sales KPIs.60 % — p. 4E-9
⚠ 60% measured for variable-ONLY reps; ALL variable income measured when there is also a fixed salary.
- A financial adviser must keep records of its balanced scorecard processes, assessments and determinations for at least five years, and must maintain for at least five years a register of all representatives who provide financial advisory services only in rollovers of dual currency investments or structured notes.5 years — p. 4E-28
⚠ At least 5 years for balanced scorecard records and the rollover-only rep register.
- Where a financial adviser has already paid variable income before determining entitlement, it must recover the portion the representative or supervisor is not entitled to by no later than the end of two calendar quarters subsequent to the measurement quarter, unless exceptional circumstances justify recovering over a longer period. — p. 4E-21, 4E-25
⚠ Recover overpaid variable income by the end of TWO quarters after the measurement quarter (exceptional cases aside).
- A financial adviser must submit prescribed reports for every measurement quarter to the Authority, including the balanced scorecard grades assigned to representatives and supervisors, the number of representatives graded, and details of appeals and of grade-E infractions, by the submission dates set out in the Notice. — p. 4E-30
⚠ Quarterly MAS reporting covers grades, counts, appeals and grade-E infraction detail.
❓Did you know?
The 60% rule cuts only one way
A representative paid variable income only has 60% of it measured against the balanced scorecard. A representative on salary plus variable income has the whole remuneration measured. The design removes any incentive to restructure pay to shrink the amount at risk.
🎯Bsc Non Sales Kpis
FAA-N20: the four non-sales key performance indicators.
- The four non-sales key performance indicators are: KPI 1 - understanding a client's needs (sufficient fact-find); KPI 2 - suitability of product recommendations (reasonable basis); KPI 3 - adequacy of information disclosure; and KPI 4 - standards of professionalism and ethical conduct. — p. 4E-32, 4E-33
⚠ All four KPIs are NON-sales: needs, suitability, disclosure, professionalism - never sales volume.
📅Competency Overview
FAA-N26: effect from 1 April 2024 and cancellation of FAA-N13.
🎓Competency Entry
FAA-N26: minimum age and academic entry requirements.
- For an individual to be an appointed representative, the minimum entry requirements are that the individual is at least 21 years old and (subject to exemptions) holds a minimum academic qualification.21 years — p. 4F-4
⚠ Age 21 + a minimum academic qualification (unless an exemption applies).
- The minimum academic qualification for an appointed representative is any of: a GCE 'A' Level certificate with passes in at least three subjects at H2 level and two subjects at H1 level; an International Baccalaureate Diploma; a diploma awarded by a polytechnic in Singapore; or an equivalent academic qualification. — p. 4F-4, 4F-5
⚠ A-Level (3 H2 + 2 H1), IB Diploma, polytechnic diploma, or equivalent - a degree is NOT required.
📝Competency Exams
FAA-N26: RES5 plus product-knowledge modules, administering bodies and module exemptions.
- The minimum examination requirements for an appointed representative are a valid pass in RES5 and a valid pass in the relevant product-knowledge CMFAS Exam modules, depending on the type of financial advisory service and the products concerned. — p. 4F-7
⚠ RES5 (rules/ethics) PLUS the product-knowledge modules relevant to what you advise on.
- The CMFAS Exam modules are administered by either the Institute of Banking and Finance (IBF) or the Singapore College of Insurance (SCI); RES5 is administered by SCI. — p. 4F-7, 4F-25
⚠ IBF or SCI administer CMFAS modules; RES5 specifically sits with SCI.
- An individual is not required to pass M8 if he has passed CM-EIP or CM-CMP, and not required to pass M8A if he has passed CM-SIP or CM-CMP; certain qualifications (e.g. a degree in finance/financial engineering/computational finance or CFA) or three years of relevant continuous working experience can also exempt an individual from specified product-knowledge modules. — p. 4F-10, 4F-11
⚠ Combined modules, a relevant finance degree/CFA, or 3 years' relevant experience can exempt product modules.
🔄Competency Validity
FAA-N26: three-year RES5 validity, deemed passes and re-take on lapse.
- A pass in RES5 ceases to be valid if the individual did not commence providing financial advisory services as an appointed representative within three years after passing, or ceased and did not re-commence such services as an appointed representative within three years after cessation.3 years — p. 4F-13
⚠ RES5 pass lapses if not used (commence or re-commence) within 3 years.
- An individual who passed Module 5 of the CMFAS Exam under the Cancelled Notice, or completed the non-examinable SCI course on Module 5, is deemed to have passed RES5. — p. 4F-11
⚠ Old Module 5 = deemed RES5 pass (still subject to the 3-year validity rule).
- Where a pass or deemed pass in RES5 or in a product-knowledge module ceases to be valid, the individual must take or re-take and pass that module in order to meet the CMFAS Exam requirement. — p. 4F-13, 4F-14
⚠ Lapsed pass -> no renewal or CPD fix; the module must be taken and passed again.
📚Competency Cpd
FAA-N26: CPD obligation, core and supplementary hours, exemptions and carry-over.
- Every appointed representative must undergo continuing professional development (CPD) training relevant to the financial advisory services he provides and obtain and retain supporting evidence that he has completed the minimum CPD hours within the stipulated period. — p. 4F-15
⚠ CPD must be RELEVANT and evidenced; the representative keeps the proof.
- By the end of each calendar year (apart from the first year of first appointment), an appointed representative of the same principal for the whole year must complete a minimum of 6 Core CPD hours (in ethics or rules and regulations accredited by IBF/SCI, or a CPF-related course) plus the supplementary CPD hours specified in Table 3.6 hours — p. 4F-16
⚠ 6 CORE hours (ethics/rules or CPF) are ON TOP of the supplementary hours - not the total.
- The minimum supplementary CPD requirement is 24 hours for a representative advising on or arranging investment products or life policies, other than mortgage reducing term assurance (MRTA) or group term life policies.24 hours — p. 4F-16
⚠ 24 supplementary hours for general investment products/life policies; MRTA/group term is only 10.
- The minimum supplementary CPD requirement is 10 hours for a representative whose advising or arranging is limited to mortgage reducing term assurance (MRTA) policies or group term life insurance policies or both.10 hours — p. 4F-16
⚠ MRTA / group term life = 10 supplementary hours (the lighter tier); everything else = 24.
- An appointed representative is not required to complete the minimum CPD hours for the first calendar year in which he is first appointed as an appointed representative of any financial adviser, for a year in which he must take or re-take applicable CMFAS modules, or for a year in which he ceases to be an appointed representative. — p. 4F-20
⚠ No CPD hours needed in the first appointment year, an exam re-take year, or the cessation year.
- An appointed representative of a principal for an aggregate period of less than 183 days in a calendar year, who is unable to complete his pro-rated CPD hours by year end, may carry over the unfulfilled pro-rated CPD hours to the next calendar year.183 days — p. 4F-17
⚠ Under 183 days with the same principal -> pro-rated CPD may roll into the next year.
❓Did you know?
CPD never really ends
After passing the exams, every appointed representative owes yearly CPD: 6 Core hours plus 24 Supplementary — or 10 if the practice is limited to MRTA or group term life. The first calendar year of first appointment is exempt, and a representative appointed for under 183 days of a year may carry the pro-rated shortfall over.
🏢Competency Obligations
FAA-N26: obligations of the financial adviser, the register, five-year retention and the s67(5) penalty.
- A financial adviser must certify that each appointed representative meets the minimum entry requirements, ensure each meets the CMFAS Exam requirements before commencing any type of financial advisory service, and ensure each meets the CPD requirements within the stipulated period. — p. 4F-21
⚠ Exam requirements must be met BEFORE the representative commences any financial advisory service.
- A financial adviser must maintain a register for each appointed representative (recording services provided, academic qualifications, examination fulfilment or exemptions, and CPD evidence) and must keep those records for at least five years from the end of the calendar year in which the representative was appointed.5 years — p. 4F-22
⚠ 5 years from the END OF THE CALENDAR YEAR of appointment - not from cessation.
- Under Section 67(5) of the FAA, a person who fails to comply with a requirement in a written direction issued by the Authority is guilty of an offence and liable on conviction to a fine not exceeding $25,000 and, for a continuing offence, a further fine not exceeding $2,500 for every day the offence continues after conviction.25000 SGD — p. 4F-22
⚠ s67(5): $25,000 + up to $2,500/day continuing - identical shape to the s58(5) penalty in FAA-N14.