commission

Are we the only industry in the UK where the customers set the profit we can make? Any other business is not required to tell the customer how much money they make on selling 2lb of peas, an electric drill or even a car?

Only a limited range of investment and pension-based products will be included in the "menu" commission tables in order to limit consumer confusion about the various remuneration levels as well as limit menu work for the FSA and IFAs, says CP04/03.

The Financial Services Authority will set all market average commission rates for menu commissions, however, adviser firms will be expected to update their document if the FSA makes changes, according to the FSA's conduct of business rules proposals....

The FSA's cost-benefit analysis of its menu proposals implies IFAs will be squeezed between falling commissions brought about by greater market transparency and rising compliance costs.

All advisers will be required to issue clients with a copy of "A guide to the costs of our services" as well as an Initial Disclosure Document and terms of business when they advise any private client, except when advising on GPPs, says the latest FSA...

Larger IFA firms can now assess the financial impact of the FSA's "cost of advice menu" on their business, thanks to the launch of specialist software by Cboxx.