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The New AICPA Personal Financial Planning Standards

PFP-standards-word-cloudThe increased demand and projected growth of personal financial planning services in areas such as estate, retirement, risk management and investments have brought the accounting profession to an important crossroad. To adapt to an evolving profession and regulatory landscape, in addition to the existing regulatory framework for CPAs, the AICPA is promulgating the Statement on Standards in Personal Financial Planning Services.

If your client base includes individuals and families, it is inevitable that you will get questions along the lines of:

  • What should I be doing about college funding for my kids?
  • How will I ever be able to retire? How much should I be saving?
  • Should I have life insurance? How much? Where should the cash come from to pay the premiums? Who should own it? Should it be in a trust?
  • How do I balance our family charitable giving goals with my retirement objectives?
  • Beyond the potential tax cost of exercising my company stock options, how should I incorporate them into my long-term personal planning?

CPAs need to prepare for the increased societal need for personal financial planning services that should be addressed and managed carefully. These standards have been developed to assist all CPAs in delivering personal financial planning services with competence and confidence.  Seasoned, experienced practitioners and those new to the service area will benefit from having a framework to guide work with their clients in the development of their personal financial plans. The standards cover the following topics:

  • General Professional Responsibilities
  • Responsibilities of Members in PFP Engagements
  • Planning the PFP Engagement
  • Obtaining and Analyzing Information
  • Developing and Communicating Recommendations
  • Implementation Engagements
  • Monitoring and Updating Engagements
  • Working With Other Service Providers
  • Using Advice Provided By Other Service Providers

Join Clark Blackman II, CPA/PFS, and me, 1 to 2 p.m. ET on Dec. 6, to learn about the forthcoming standards and how they can help you and your firm in the delivery of personal financial planning services in a free webcast for AICPA members. Learn about the nature, objective and requirements of the standards, when and to whom they apply, how they will help elevate your practice, the expected timeline for issuance, when they become effective and the tools available to help you implement them.

Dirk Edwards, CPA/PFS, JD, MBA, Edwards Consulting, LLC. Dirk is a past chairman of the AICPA Personal Financial Planning Executive Committee and current chairman of the Responsibilities in Personal Financial Planning Services Task Force. 

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