Under the CFP Board's proposal, all of this would have to be tied together into a cogent financial plan. "The proposed financial plan development course would require individuals seeking to attain CFP certification to demonstrate their ability to integrate and apply the financial planning topic areas to a scenario based on the types of situations a practicing financial planner might be expected to address with clients," said Marilyn Capelli Dimitroff, chair of the CFP Board.
As proposed, the new requirement would require financial planning education programs registered with the CFP Board to offer a financial plan development course by January 2012. The organization is taking written comments on the proposals during a 60-day period that ends October 2.
Comments will be reviewed by the CFP Board's Council on Education and posted in their entirety on the organization's Web site. The CFP Board is particularly interested in comments focused on implementation, assessment and course outcomes related to the proposed requirement.
Inspiration for the proposal came after the CFP Board's international cousin, the Financial Planning Standards Board Ltd., added a comprehensive case study component to its curriculum.
The entire proposal can be found at www.CFP.net/downloads/Financial_Plan_Development_Course_Proposal.pdf. Comments can be e-mailed to [email protected]. Or they can be mailed to: CFP Board, c/o Managing Director of Education, 1425 K Street NW, Suite 500, Washington, D.C., 20005.
M&A Activity Down, But Not Out
As can be expected in the current environment, the pace of mergers and acquisitions within the advisory space is down in 2009. That said, interest in M&A deals remains strong as advisors seek ways to strengthen their practices in a challenging marketplace.
According to Schwab Institutional, there were 36 M&A deals among registered investment advisors through June 30, totaling $54 billion in assets. Projected on a full-year basis, that's 72 deals and $108 billion in assets. Last year, there were 88 deals and $137 billion; in 2007, it was 80 deals and $101 billion.
"Clearly, the steep growth trajectory seen from 2005 through 2008 has slowed," said David DeVoe, managing director of strategic business development at Schwab Advisor Services. "But it's not Armageddon, and the bottom hasn't fallen out of the market."
DeVoe cited two reasons for the slowdown. One is stock market declines that lowered asset levels and revenues, as well as cash flows and valuations that go into calculating deals.
The other is the distraction of intensive client care during the turbulent times. "M&A is usually something you do after 5 p.m.," DeVoe says. "But principals have been spending countless hours hand-holding their clients through the downturn."
As a result, he adds, the amount of time it takes to negotiate deals has grown from roughly nine months in past years to about 12 months.
But DeVoe says interest in M&A deals among RIAs has picked up. He noted there were roughly 20 participants during his monthly M&A call in November; in recent months that's grown to about 150 per call.
Among all deals done during the first half, 61% of buyers were RIA firms and 37% were holding companies whose business models are predicated on making acquisitions.