Reference no: EM132337602

Develop a Financial Plan

Task

1 Establish plan objectives and scope
2 Develop strategic assumptions
3 Develop financial plan strategy
4 Develop financial plan

Objective The objective of this assessment is to develop and prepare a financial plan that meets the client's needs as described in the case study assigned to you.

Scope

To achieve this objective, you will need to:
• establish plan objectives and scope,
• develop strategic assumptions,
• develop financial plan strategy,
• develop preliminary financial plan,
• ensure compliance of financial plan with regulatory and organisational requirements, and
• produce completed plan.
The assessment tasks in this assessment require you to have successfully completed the Complex Financial Planning Research Spreadsheet in relation to your assigned case study.

Assessment Task 1

1.0 Establish plan objectives and scope
This first assessment task requires you to establish plan objectives and scope.
It requires you to:
• review and compare research results to client requirements and expectations,
• analyse current client situation to determine opportunities and constraints,
• identify and assess desired financial resource and market parameters, and
• develop plan objectives for asset growth, income, risk, taxation and any other objectives developed in consultation with the client.
For this activity, you should refer to the Financial Planning Research Spreadsheet you prepared in the previous Assessment Task and complete your answers in the space provided in the following page. An example has been provided in the first line.

Assessment Task 2

Develop strategic assumptions
The next step involves developing and testing your strategic assumptions, which requires you to:
• develop and test client related and economic key assumptions,
• identify and test legislative and regulatory requirements, including taxation assumptions, and
• seek clarifications from client or other professionals as required and document strategic assumptions for client review.
For this activity, you should refer to the Plan Objectives you prepared in the previous Assessment Task.

2.1 Develop & test strategic assumptions
In the second column in the table below, list the key ‘Assumptions' you have used to develop your plan objectives, considering:
• legislative and regulatory assumptions requiring verification,
• taxation assumptions requiring verification,
• client assumptions requiring clarification from your clients,
• other assumptions requiring clarification from other professionals
Now list in the third column of the table below titled ‘Verification', the information sources you will research and the stakeholders you will consult to verify the assumptions made. (Website addresses etc.)

Assessment Task 3

Develop financial plan strategy
The next step involves developing and testing your strategic assumptions, which requires you to:
• develop initial strategic options based on strategic assumptions and client specifications
• analyse and model strategic options, with any inappropriate options rejected
• develop supporting arguments for each final strategic option and include in a draft overall strategy, and
• make any necessary client checks or consultations to verify the plan strategy.
Complete your answers in the space provided in the following pages.

3.1 Develop plan strategy
In this activity, you are required to develop the final Plan Strategy that you will use to prepare the Financial Plan.
This will involve you developing the supporting arguments for each strategic option, based on the analysis and modelling undertaken in the Paraplanning Research Report
To successfully complete this task, you will have needed to undertake all ‘Verification' of ‘Assumptions' developed in the previous activity.

3.2 Rejected strategic options
As a final review of your Strategic Plan, list below the inappropriate strategic options that you rejected.
In answering this question, you should refer back to the strategic options you developed earlier in section 1.3 (a) as a brief for the Financial Planning Research Report
Type your answers below in the space provided. An example has been provided in the first line below.

Assessment Task 4

4.0 Develop preliminary financial plan

In this assessment task, you will need to develop a Financial Plan for assessment. This will require you to:
• select specific products and options to meet agreed strategy with cash flow, liquidity and capital preservation or estate planning requirements incorporated as required,
• develop recommendations for financial asset allocation structure, including where provision is required for equities, trusts, partnerships, allocated pensions, and superannuation and planned capital expenditure
• develop recommendations for changes to income and taxation arrangements, including referral advice to accountants or lawyers as appropriate,
• develop recommendations on risk management strategies and products and incorporate in the plan,
• incorporate anticipated fees and charges into the plan, with information on internal and external complaint resolution procedures available to the client, and
• document the financial plan according to organisation guidelines and procedures.

4.1 Develop a preliminary Financial Plan

Using the Financial Plan Template, prepare a Financial Plan, based on the Complex Financial Planning Assessment Task and spreadsheet you prepared earlier in relation to your case study.
Your Financial Plan will need to include:
• Covering Letter
• Cover Page
• Introduction
• Executive Summary
• Current Situation
• Risk Profile
• Information Resources
• Strategic Assumptions
• Strategies
• Cashflow Requirements
• Insurance Products Selection
• Investment Products Selection
• Disclosure of Commissions and Fees
• Portfolio Review
• Authority to Proceed
• Action to Proceed
• Disclaimer
• Client Declaration
• Adviser Declaration
• Appendix
If there are other matters you consider are relevant then you should include them. However, you need to include all the topics listed above.

Attachment:- Develop Financial Plan.rar