When the call comes from compliance that your branch examination is imminent, some advisors decide it’s time to take a vacation while others take the vapors. But branch exams should not be stressful or painful – if you follow these basic steps and integrate them into your practice.
Put your clients’ interests first
If you begin with that premise, everything else flows from there. If you have spent the year following that credo, you will have a successful exam. The Raymond James philosophy is to help support its advisors and their branches. The home office’s education, training, products and services are all designed to help advisors meet their clients’ needs first and foremost, and they do whatever is necessary to achieve that.
Treat your Compliance department as your ally not your adversary
I value the support we receive from the Compliance Department, and my staff has developed working relationships with the compliance specialists. Staff from my office go to the national conferences and attend the compliance sessions, at least one of which usually focuses on how to stay prepared for a branch examination. They participate in the quarterly compliance conference calls and stay up to date on changes; they know who to go to for answers; and if we are making any significant changes or decisions, we START with compliance before we talk to anyone else. If you view firm policies and procedures not as hoops to jump through, but rather as directives to ensure your clients have a better experience, you will appreciate that partnership. In fact, Raymond James Compliance has published a Vision statement, in which they put their commitment to us in writing. In addition, a bi-monthly newsletter keeps us apprised of firm, industry and regulatory happenings.
Empower your staff
In addition to being involved in all the training and compliance sessions, my staff is empowered to make decisions, to create new systems and processes, to recommend changes to the way we do things. We have weekly staff meetings, and everything is on the table for discussion. If there were any findings in an exam that need addressing, we do it at the very next meeting. I have to remind myself on occasion not to resent the time it takes for my staff to do all these things – that the investment more than pays off with successful examinations and client satisfaction.
We are very disciplined about our systems, lists, databases, etc. We have an office database in which every activity is recorded and reminders are generated for every client signature needed, letter to be written, thank you card sent, compliance procedure to be completed, etc. One person is responsible for maintaining the database, but everyone accesses and posts to it.
Have a checklist, or ten
We have checklists for everything, not just how to prepare for an audit. There’s a checklist for adding a new client, for handling archived files, for address changes, even for verifying that data has been recorded by the home office accurately. Compliance also provides a Branch Office Checklist, which is a good reminder of my supervisory responsibilities, as well as some operational ones. My staff are masters of the excel spread sheet, along with color coding, charting, labeling, note-taking, etc.
So, my advice to my peers is to always put your clients’ interests first, partner with your compliance department, be disciplined in your processes, empower (and truly appreciate) your staff – and your next branch exam will be a breeze.
Lois E. James, CFP® is president of James Investment Group, an independent firm in Iowa City, Iowa, and a co-branch manager and a financial advisor of 26 years with Raymond James.
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