AICPA Issues Additional Guidance On Personal Financial Planning Services

The American Institute of CPAs has released additional guidance for CPAs who offer personal financial planning services, issuing practice standards that apply the Institute’s rigorous code of professional conduct to the rapidly growing discipline. The standards add to existing oversight of CPAs and come as clients seek advice on more topics.

The AICPA Statement on Standards in Personal Financial Planning Services covers all aspects of the planning process from obtaining information to communicating and implementing recommendations. The standards are an evolution of principles that have guided CPA financial planners for two decades and require complete transparency on factors such as compensation and potential conflicts that could influence client decision making. They are authoritative and enforceable and must be followed by all AICPA members who do financial planning.

More members have begun offering personal financial planning services as more clients turn to them for help navigating a broader spectrum of financial issues: taxes, retirement planning, education planning, estate planning, investments and risk management. Membership in the AICPA’s Personal Financial Planning Section has increased 32% over the past five years, growth that tracks national trends. The Bureau of Labor Statistics has projected the number of personal financial advisors to increase 27% nationwide between 2012 and 2022.

“CPAs, through state licensure and professional oversight, must meet the highest bar of competency, objectivity and integrity,” said Lyle K. Benson, who chairs the executive committee of the AICPA’s PFP Section. “These standards provide a clear roadmap for achieving that benchmark in a rapidly evolving practice area. They are built on the cornerstone of the CPA profession — the public interest — and enhance the consistency and rigor that CPAs are known for in the financial planning discipline.”

The executive committee issued the standards, which take effect July 1, through authority granted by the AICPA’s governing council in October 2012. They are based on the AICPA “Statement on Responsibilities in Personal Financial Planning Practice,” which was first adopted in 1992.