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About the Financial Planning Body of Knowledge

Version 1.0, Updated 20170907

The Financial Planning Body of Knowledge (FP-BoK)—the first of its kind internationally—builds on the Canadian Financial Planning Definitions, Standards & Competencies to define the scope and holistic nature of financial planning.

The FP-BoK clearly distinguishes the knowledge expectations of CFP professionals and FPSC Level 1 certificants in all financial planning areas.

The FP-BoK provides the underpinning for the FPSC Competency Profile—it is essential to the demonstration of competence in the fundamental financial planning practices, financial planning areas, and professional skills.

Audiences

The FP-BoK is intended to serve as a resource to a number of groups. Examples of potential uses include:

AUDIENCES USE OF FP-BOK

Educators of future financial planning professionals

To develop and deliver educational content that prepares the next generation of financial planners

Students contemplating entering the profession or currently on the path to FPSC certification

To understand the distinct nature of financial planning, as defined by the expectations of CFP professionals and FPSC Level 1 certificants, when compared to other disciplines

Industry firms recruiting financial planning professionals

To define the expectations of CFP professionals and FPSC Level 1 certificants in meeting the broad, holistic financial planning needs of clients

Practicing CFP professionals and FPSC Level 1 certificants

To assist in maintaining currency of knowledge and employer expectation

 

Development Process

The FP-BoK was developed by over 80 practicing CFP professionals from across Canada and a variety of subject matter specialists in the various topic areas. As practitioners and experts in the technical knowledge topics, the volunteers developed technical knowledge statements and illustrative case studies that reflect the level of knowledge required for effective financial planning practice.

The rigorous review process involved input by the following key groups to ensure its relevance, clarity, comprehensiveness and currency:

  • CFP professionals with in-depth experience providing financial planning advice to small business owners reviewed each topic area to help ensure the inclusion of appropriate technical knowledge.
  • Educators provided feedback on the depth, breadth and clarity of the FP-BoK and practicality of the case studies for teaching purposes. 
  • A Professional Practice Working Group of CFP professionals and educators provided oversight and approval of the FP-BoK through extensive review of the technical knowledge statements and case studies.

The FP-BoK will change as the financial planning profession evolves. It will be reviewed on a periodic basis by an independent Standards Panel made up of financial planners and public members and will be updated as appropriate.

FPSC sincerely thanks the many pioneers who contributed to this initial publication.

Knowledge Expectations

While both CFP professionals and FPSC Level 1 certificants draw from the same Body of Knowledge, the knowledge expectations of CFP professionals are broader, given that they must provide objective financial planing advice at the highest level of complexity required of the profession. Specfically, CFP professionals are expected to have greater depth of knowledge in areas including registered retirement plans, registered education and disability plans, taxation, insurance, and estate planning and legal aspects.

It is the complexity of the client situation that influences the depth of technical knowledge required for each designation. Since CFP professionals are expected to capably provide financial planning advice at higher levels of complexity, they require knowledge that goes above and beyond the expectations of FPSC Level 1 certificants.

The FP-BoK sets the minimum expectation for the level of knowledge required of CFP professionals and FPSC Level 1 certificants, but it is not intended to limit the scope of practice of any individual. CFP professionals and FPSC Level 1 certificants may possess greater levels of knowledge based on their backgrounds and experience.

As set out in the FPSC® Code of Ethics, financial planning professionals must seek the counsel of qualified individuals and/or refer clients to such parties when they do not possess the appropriate knowledge or are not sufficiently competent in any particular area or scenario. 

 At a glance, here are some select examples where CFP professionals are expected to have greater depth of knowledge than FPSC Level 1 certificants:  

Registered Retirement, Education and Disability Plans

  • Advanced pension decisions, including pension buybacks and commutations
  • Individual Pension Plans
  • Supplemental Executive Retirement Plans
  • Retirement Compensation Arrangements
  • Consequences of the death of parties associated with registered plan

Taxation

  • Taxation of sole proprietorships and partnerships
  • Taxation of corporations
  • Taxation of personal asset transfers into a sole proprietorship, partnership or corporation
  • Methods and taxation of income/asset withdrawals from a corporation
  • Capital Dividend Account
  • Refundable Dividend Tax on Hand
  • Disposition of shares of a corporation
  • Personal service businesses
  • Taxation of inter vivos and testamentary trusts
  • Tax shelters
  • Advanced income splitting opportunities
  • Operating companies
  • Holding companies
  • Capital gains deductions/reserves
  • Principal residence exemption
  • Taxation related to U.S. Persons
  • U.S. estate taxation
  • Estate freezes
  • Tax impact and options at death

Insurance

  • Life insurance as a tool for equalizing or creating an estate
  • Life insurance as an alternate investment  
  • Drawing an income stream from a life insurance policy
  • Deferring or paying taxes using life insurance
  • Life insurance to fund buy-sell agreements
  • Maintaining privacy of assets using insurance
  • Critical illness insurance
  • Long-term care insurance
  • Accessing cash from permanent life insurance policies
  • Taxation of insurance

Estate Planning and Legal Aspects

  • Business ownership structures
  • Personal and business contracts
  • Inter vivos and testamentary trusts
  • Absolute discretionary and inbound trusts
  • Support and maintenance under family law
  • Division of property upon relationship breakdown
  • Estate succession
  • Probate
  • Dependents’ relief
  • Intestacy
  • Preferential share