Content

Introducing Best Practice Private Clients

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True Impartiality
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A Commitment To Excellence 7/8
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Our Service Proposition 9
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Our Investment Partners
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The Next Step
12 Introducing Best Practice Private Clients

At Best Practice Private Clients we are our core beliefs about impartiality,
committed to a new standard for wealth professionalism and service and results in a
management and financial planning. Our unique proposition for our clients. These
commitment to excellence encompasses fundamental principles are clearly
illustrated in the specific standards we set with our core beliefs, results in a highly
ourselves in relation to the qualifications professional and impartial approach to
our advisers hold, the way we are providing bespoke solutions for our clients.
The Future Of Financial Services
remunerated and the service we provide.

Best Practice is a regulatory organisation

The Financial Services Authority is currently
that oversees a network of financial
overseeing a review of how financial advice
advisers and is now providing a private
is provided in the UK (The ‘Retail
client service from a foundation of
Distribution Review’). There is broad
extensive market experience and
consensus on two major factors that will
regulatory knowledge. This, in conjunction
improve the standard of advice. Firstly,
advisers should be qualified to a higher to the very highest designated level in the
level. Secondly, there should be a move to industry. We also require that all advisers
a transparent, fee-based model of work on a strictly fee paid basis, in the
remuneration. The target is to implement same way as a lawyer or chartered
recommendations based on these accountant, with absolutely no commission
fundamental principles by the end of 2012. True
payments being taken. Impartiality
At Best Practice Private Clients we have
embraced these proposed changes and
gone a step further to establish a model for We believe that truly impartial, unbiased
highly professional, truly impartial advice. advice must focus purely on the needs of
We require all our advisers to be qualified our clients. We believe, in line with current
recommendations, that this demands a comparison with legal professionals or
completely transparent approach to accountants.
adviser remuneration.
The Retail Distribution Review has
Commission, or any type of provider-based recognised this and has recommended a
remuneration, can lead to gradual evolution to a more fee based
recommendations being made that are not approach. At Best Practice Private Clients
purely to the benefit of the client. This has we have taken this a step further and made
lead to a fundamental difference in a firm commitment that our advisers will
perception of financial planners in only ever be remunerated purely by fees
paid by our clients. This core belief ensures
 The Cost Of Impartiality
the advice process is never open to Even where upfront commission is not
commission bias. taken, ongoing ‘fund based’ commission
Commission taken by advisers has a direct can have a dramatic affect on the ongoing
affect on the charges levied against a charges levied on a portfolio. This typically
client’s portfolio. In simple terms, an will have the affect of increasing the annual
‘initial’ upfront commission will often be management charge on a portfolio by 1%.
directly deducted from an investment
(either at outset or over a number of years) With larger portfolios, a 1% annual charge
and paid to an adviser as a percentage represents a significant expense (£20,000
(typically in the region of 3 - 5%). per annum on a £2 million portfolio). A
purely fee based approach is likely to
 The Effect Of Advice Charges
provide an economy of scale for such impartiality, will result in a reduction in
portfolios and, as well ensuring overall costs.
Taking a closer look at the effect an adviser charge or renewal commission has to a
portfolio; we can see that the cost is compounded by the loss of growth to an investor’s
portfolio:

£4.0m Assuming Growth at 7%, Fund Management Charge of 0.5% pa

£3.75m Value Of Portfolio With No Adviser Charge: £3.74

million Effect Of
£3.5m Charges Over 10
Value Of Portfolio With 1% Adviser Charge: £3.41 Years:
million -£330,000
V £3.25m
A
L £3.0m
U
E £2.75m Amount Deducted In
Adviser Charges Over
£2.5m 10 Years: £200,000

£2.25m

£2.0m
 0 1 A 2Commitment
3 4 5 To Excellence
6 7 8 9
10
qualifications is one of the only objective
YEARS
ways of making a judgement about a
Welarger
For have aportfolios,
simple belief:
it is That our people
obvious that thereplanning firm and itsofpeople.
are economies scale provided by a
remuneration method based on a fixed fee compared to a percentage charge.
need to be qualified to the very highest
level to give our clients complete As a firm, we’re proud to have been
confidence that they are receiving the very awarded the prestigious title ‘Chartered
highest level of advice. Comparing
Financial Planners’ by the Chartered maintaining the knowledge and capability
Insurance Institute (CII). The award of their people. It also signifies adherence
to a demanding code of ethical practice.
Chartered Status is the industry’s gold
of Chartered titles is strictly controlled by Fellowship
standard and Of The Personal
is currently met by Finance
only a Society
the Privy Council and is an objective select number of firms (241 as at 1st
measure of high standards of November 2009).
professionalism. The vast majority of financial advisers
subscribe to entry-level qualifications such
This title is only awarded to firms with a as the Financial Planning Certificate. This
commitment to developing and gives them Certification by the Personal
Finance Society (PFS). The Retail this level, many of which are not practicing
Distribution Review has recommended that advisers (as at 1st November 2009).
advisers are qualified to a more advanced
‘Diploma’ level of membership to the PFS. In order to reach this exacting standard,
our advisers have to attain advanced
Best Practice Private Clients requires its qualifications in such areas as tax planning,
advisers to be qualified as ‘Fellows’ of the retirement options and investment
Personal Finance Society. This is the very analysis. This means they are capable and
highest level of designation and even licensed to deal with all your requirements
surpasses the requirements for Chartered no matter how complex.
status. There are only 494 individuals at
 Our Service Proposition

We provide truly bespoke solutions for our changing circumstances and objectives,
clients tailored to their own specific market conditions and the need for
objectives and benchmarks. We construct portfolio rebalancing. We use state of the
portfolios based on asset allocation tools, art systems to provide a platform for all
detailed investment analysis and then your investments that we monitor on a
utilise every tax advantage possible in daily basis. We provide you with online
delivering the agreed strategy. access and give you the facility to obtain
real time valuations and a wealth of other
This is only half the story. As important as information. Unlike many other advisory
these initial steps is the ongoing review firms, we do no levy an additional charge
process that takes into account your for this facility.

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holdings tab from Enable
 Our Investment Partners
recognise the progressive nature our new
model for financial planning and are keen
In providing the highest level of financial to be part of this vision. We have,
planning and investment advice we therefore, been able to negotiate a range of
recognise the need to delegate the discounts that give our clients preferential,
management of aspects of a client’s institutional terms.
portfolio to the best fund managers and
investment directors in the market place. This, together with our fixed fee approach,
typically brings the overall cost for our
We have developed relationships with a clients far below the levels traditionally
range of investment partners who applied for this type of service.
 A Unique Approach
on a daily basis and accessible to our
clients online.

The delivery of this approach is provided at

Our commitment is to the highest level of a lower cost to similar services due to the
professionalism and impartiality. This is economy of scale inherent to our fixed fee
based on the highest possible level of model and the substantial discounts we
adviser qualification and the removal of have negotiated with our investment
commission bias. This is then supported by partners.
personalised portfolios that are monitored

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partners such as UBS, Octopus etc
This is the new model for the future of To organise a free consultation with one of
financial planning. No other advisory firm our financial planners, please contact us:
has committed to such strict, objective
criteria for delivering financial planning and Telephone: 0207 1010201
investment advice. Fax: 0207 1010211
Email:
[email protected]
The Next Step
More information is also available on our
. website:
www.bpifa.co.uk/privateclients

Best Practice Private Clients is a trading style of Best Practice IFA Group Limited which is authorised and
regulated by the Financial Services Authority
London Office:
50 South Molton Street
Mayfair
London W1K 5SB

Head Office:
Sussex House
North Street
Horsham
West Sussex RH12 1RQ