If you’ve been following the SEC’s Form CRS requirements or the latest reporting requirements under the CFP Board’s New Standard of Conduct, you will have noticed one common thread: both require advisory firms to deliver disclosure documents and to be able to prove that the client both received and understood them.
Sounds easy right? Don’t all of your clients respond to your emails where you provide your ADV Part 2 every year with: “Hey thanks for sending your ADV Part 2! It was a great read and so easy to understand!”? Not likely. So how then can you prove they got it and how can you have them confirm that they understood it?
Email is a bad choice. Your client might not even open your email. And chances are pretty good they won’t confirm receipt even if they do. And expecting them to write back with “I understood it.” is expecting a lot, to say the least.
You could call all of your clients and ask for their permission to record the conversation. Talk about awkward! Not to mention the fact that you and your client probably have better things to do.
I have a better idea. Why not use PreciseFP to both deliver your disclosure documents and engage clients for their feedback and confirmation? PreciseFP is the ultimate client engagement platform. It was built for this very type of engagement. Through the use of mandatory fields and reminder emails, clients are gently nudged until they give you what you want: confirmation that they both received and understood your disclosure documents.
PreciseFP even allows you to insert initials and e-signature fields so that the client electronically signs the document, giving further proof that the confirmation is real.
Take a look at this snippet from an advisor’s PreciseFP ADV Part 2 template:
Here’s why you should add your disclosure documents to your PreciseFP template library too:
- Customizable email templates means PreciseFP can send out your disclosure docs to dozens, even hundreds of clients with a click of a button.
- Mandatory fields make it impossible for the client to submit the engagement unless the client confirms receipt and understanding of the disclosure documents.
- Reminder emails gently nudge the client until they engage, confirm, and submit, freeing you from the task of babysitting your client.
- E-signatures, if you choose to use them (ours is free, BTW) make this solution even more water-tight!
In addition to all the other areas that advisors use PreciseFP to engage clients, compliance is an area where we are seeing more and more adoption. It’s a no-brainer in my books!
Don Whalen, CFP®, CEO