The Moran Principle

Talk about the pot calling the kettle black. ASIC has trotted out its regular review of the 'quality of advice' survey by randomly selecting 64 pieces of advice from around Australia - and extrapolating the results to suggest that Advice is not very professional. Out of the 64 advisers 'checked' (out of a pool of authorised representatives of 15,000), they are able to judge just 2 as 'good'. My issue with this is that the judgment is based purely on the written document and does not provide any guidance as to the real advice offered. ASIC has yet to come up with a suitable methodology of evaluating financial advice and so we seem stuck with this flawed approach. We don't see ASIC broadcasting that 1/3 of their sample of written plans needed to be improved - we see a headline that 1/3 of financial advice is poor. Perhaps under the new limited advice regime, where no written plan is required for many of the guinea pigs sent out to evaluate, we will score f...