New service helps advisers become directly authorised
Apricity recently launched its Going it Alone service, which helps advisers become directly authorised. We asked MD Cathi Harrison about the challenges advisers face when looking to become directly authorised and what the new service offers
Why have you set up the Apricity Going it Alone service?
• We know there is a lot of uncertainty when advisers are going directly authorised for the first time.
• A big part of that is obviously the FCA application, and there is support available towards achieving that.
• But we think it’s about more than just the application – it’s about helping a firm set up their systems and processes, make decisions regarding risk and research tools and knowing how to segment and target their ideal clients.
• These are all fundamental to setting up a successful advisory business and the ‘Going it Alone’ service therefore helps support advisers through the whole process.
• It’s a gap in the market and from what we understand, there’s no one offering that type of support for the whole process, to those embarking on the journey of going directly authorised.
What do you see as the main challenges advisers face when looking to set up their own firm and seek FCA authorisation?
• Advisers need to remember, when going it alone, that they now have two full time jobs. That of an adviser, and that of a business owner. And being able to put their business owner hat on and approach the application from that angle is key to a smooth transition.
• Challenges therefore can be when advisers are focusing too much on the actual advice they plan on giving – and less on the overall business structure – and this can play out in the cash flow and business plan they draft.
What are the three areas that you see as vital for new businesses to address if they are to be successful?
1. No firm can be everything to everyone – so they need to define their preferred clients / types of advice and focus on them.
2. Process, process, process. Centralising and creating processes can seem a bit of a pain at the outset, but will make life so much easier as the business starts to grow
3. Fundamental to anybusiness, not just advisory ones, is having an idea of where they are going. A business that wants to be a lifestyle business (with one to five employees) will have a very different journey to one that wants to be a high growth business. Making decisions every day will be so much easier if this has been considered and planned at the beginning.
How can firms know if they have the right set-up, firstly, to receive authorisation and secondly, to build a sustainable business?
• We would review their business plan as part of our support with the Going it Alone service. We can use our experience with FCA applications to advise whether the FCA are likely to be approve based on that business plan, or whether changes are needed (to try to streamline the time the application spends in FCA hands!).
• The FCA are looking for viable, and sustainable businesses, and so having a robust business plan that meets this criteria should meet both objectives.
What does Apricity offer to help advisers get through the authorisation process?
• We can offer guidance around selecting the preferred structure (limited company vs partnership vs sole trader) and how to apply.
• We can then review and provide guidance on the business plan and cashflow, and do all the checks the FCA are likely to do, include a review of their CV, companies house, gaps in employment history etc. This helps pre-empt any issues or questions the FCA may have. We will also confirm if a significant event disclosure needs to be completed, and help with the form A.
• Once submitted, we can be copied in on emails from the FCA (though the response needs to come direct from the adviser) but we can help answer any remaining questions, with the aim being that these are minimal as we have pre-empted / dealt with most of them at outset.
What about getting through the first year of business? How can you help with that?
• We’re all about making sure compliance is naturally embedded in a firm, and the way to do that is to ensure the set up is correct at the outset.
• We’ll therefore work with a firm in the first year to put all their systems and controls in place and test them.
• This will be everything from the advice process, to adviser training, to T&C, to file checks, to ensuring the supervisors are working efficiently.
• Getting all of this stuff working right at the outset, and tested over the first year, will result in a business with easy to follow, repeatable processes, with ‘being compliant’ a natural output of that, rather than an ‘extra’ thing they have to think about.