These are examples of indicators used by small firms to assess competence

These are good practice examples of minimum standards used to assess competence in small firms

Appropriate exams and regulatory modules studied for and passed. 
Relevant regulatory module to be passed before starting advising

One year time limit imposed for full appropriate examination passes with documented considered action if not achieved by the adviser

Firm undertakes formal testing for product and market knowledge, regulatory and other legal issues and firm-specific procedures.

70% pass rates for all formal testing undertaken at recruitment and on an annual basis.
Training needs identified from errors and put into action plan.

Observed role-plays and accompanied client visits with appropriate frequency to assess skills in assessing client needs and presenting suitable recommendations

Minimum two role plays on recruitment and one month’s accompanied client meetings where performance assessed and graded

File monitoring undertaken with appropriate frequency to assess quality of advice provided and the completeness of file documentation

100% file checking for three months with 95% pass rate for development to next level

Management information obtained and analysed to identify progress

Product type, lender spread, take up rate, complaints, ratings on tests, file checks and sales role-plays reflect development.

Training plans implemented and assessed on a regular basis through one-to-ones

One-to-one assessments on a monthly, quarterly, half-yearly or annual basis

Attendance at training events and self training with evidence of understanding of the areas trained to ensure effectiveness.

Testing undertaken on training and pass mark of over 70% required

Training needs identified from errors and input to action plan.

Ongoing fit and proper checks

Credit check on an annual basis and adviser declaration of fitness

An appropriate level of file monitoring is undertaken for each adviser and performance assessed on quality of mortgage business written. Results from file monitoring either confirm continuing competence or trigger action

Firm undertakes 10% file checks per month and rates files accordingly, with action required when standards are not met

Performance in observed client visits or role plays undertaken in mortgage sales

Two observed client visits per year or two role plays per year with suitable passes of 70% in mandatory and non mandatory areas

Any areas for development are logged on a training action plan

Annual knowledge tests for mortgages, firm procedures and regulatory tests

70% pass mark in all formal testing

Any areas for development identified from errors are logged on a training action plan

Management information obtained and analysed to indicate risk areas and influence amount of supervision

Product type, take up rate, lender spread, complaints and ratings on tests, file checks and observations reflect risk to the business

Training plans implemented and assessed on a regular basis through one-to-ones

A suitable number of one-to-one assessments are undertaken on a monthly or quarterly basis

Range of ongoing continuing professional development relevant to needs

Continuing professional development reviewed on a quarterly basis.

Ensure that this is tailored to training needs

Ongoing fit and proper checks

Credit check on an annual basis and adviser declaration of fitness

Supervisors are competent to undertake certain areas of supervision

If the firm considers it appropriate, supervisors have at least the same qualifications or more than the advisers they are responsible for

Supervisors must have the necessary coaching and assessment skills

The volume and quality of supervision carried out is reviewed quarterly by a director, other competent supervisor or compliance consultant

Supervisors undertake appropriate continuing professional devleopment to maintain their competence

A director or other competent supervisor undertakes a review of the supervisors’ own professional development to ensure it meets training needs

Supervisors have the knowledge, skills and experience to undertake coaching and training

Firms collate feedback on the skills and abilities of the supervisors from third parties or others within the firm on annual basis

Managers observe training sessions provided by supervisors

Annual knowledge tests for mortgages, firm procedures and regulatory tests

70% pass mark in all formal testing

Any areas for development identified through errors are logged in a training action plan

Where qualifications are not required by the firm to supervise, supervisors have the relevant expertise or attend the necessary training

Firms provide training courses for supervisors to attend on a twice-yearly basis to enhance skill, knowledge and expertise

Where compliance consultants audit the firm, this reaffirms the supervisors competence

Firms compare external compliance reports with internal reports on an annual basis

Checks are made on quality of any remedial steps taken