The End of SOAs: A Blank Canvas for Reimagining Advice

The confirmation from the Government that Statements of Advice (SOAs) will be replaced with more flexible and client-centric advice records marks a watershed moment for financial advice in Australia. This change, part of the Government's second tranche of Delivering Better Financial Outcomes reforms, not only creates an unprecedented opportunity for practices to reimagine how they deliver and document advice, but also promises to enhance the overall client experience.

The liberation from prescriptive SOA requirements, coupled with changes to the best interests duty, empowers practices to design advice documentation that truly serves client and compliance needs. The 2024 Australian Financial Advice Landscape Report reveals that tech-savvy practices already achieve 29% higher profit margins than their peers - a gap that may widen as forward-thinking practices seize this opportunity to rebuild their advice process from scratch.

Taking a Clean Slate Approach
Rather than waiting for legislative certainty, leading practices are already exploring innovative approaches to advice delivery. The most successful firms view this as an opportunity to fundamentally rethink how they communicate and document advice rather than simply trying to replicate current SOAs in a different format.

This approach, which is in line with broader industry trends toward more efficient, client-centric advice delivery, fosters a deeper connection between advisors and their clients. The Landscape Report shows that 55% of practices are purposely growing while targeting specific client types, indicating a shift toward more strategic, focused advice delivery models. More efficient advice documentation can support this growth while maintaining quality and compliance.

The Problem with Paper
The current approach to SOAs is a relic of the early 2000s when Microsoft Word and paper were the best technologies for documenting advice.

Today, these documents have ballooned to 80-120 pages, with research conducted by MyMavins for the FAAA (then FPA) showing that only one in seven advised clients reads their SOA in full. Despite taking 20-26 hours to produce and costing thousands of dollars, these documents often fail at their primary purpose: helping clients understand their advice.

As one example of an alternative option, the research conducted by MyMavins with advice clients revealed that video records of the advice (to be clear - a recording of the meeting where advice is provided rather than a separately recorded video) could be even more transformative:

- Videos are more likely to be reviewed by clients than written documents
- Clients see video records as more authentic and accurate representations of discussions
- Non-verbal cues and engagement are captured, providing evidence of the client's understanding
- The format allows for real-time demonstration of concepts and strategies

The key to success lies not in simply recording meetings, but in thoughtfully designing the advice experience. Leading practices are:

1. Using structured agendas that align with legislative requirements while maintaining a natural conversation flow
2. Leveraging screen sharing to demonstrate concepts and strategies in real-time
3. Providing brief written summaries (1-3 pages) for client reference using AI generation

Addressing Client Needs
While video SOAs may not be the solution for all practices, the shift away from prescriptive SOAs presents an opportunity to better align advice documentation with client preferences and understanding. The Landscape Report indicates that practices leveraging data analytics for client segmentation and service delivery are achieving higher profitability and growth. This same data-driven approach can be applied to advice documentation, ensuring that format and content are tailored to individual client needs and preferences.

Leading practices are finding that different client segments prefer other forms of communication. While some clients value detailed written analysis, most respond better to visual representations or interactive tools. Removing prescriptive SOA requirements allows practices to cater to these preferences while maintaining necessary compliance standards.

Building for Scale
The evolution of advice documentation (and the other announcements made by the Government about the best interest duty changes) aligns perfectly with broader industry trends toward scaled advice delivery. Practices that effectively systematise their advice documentation while maintaining personalisation and quality will be best positioned for growth. This is particularly relevant given the Government's focus on expanding access to advice through super funds and other channels, offering a promising future for the industry.

The most successful practices are approaching this as an opportunity to build scalable systems that can support different types of advice delivery - from comprehensive financial planning to more focused, single-issue advice. This flexibility will become increasingly important as practices adapt to serve different client segments and needs.

Maintaining Compliance
The blank canvas offered with the removal of prescriptive SOA requirements provides greater flexibility to improve how compliance - which remains crucial - can be seamlessly embedded in the advice process. Leading practices focus on embedding compliance controls within their new documentation processes, ensuring that regulatory standards are met and exceeded. This proactive approach to compliance is a key element in the successful transition to the new advice documentation system.

The key to success in the new advice documentation legislation is balancing flexibility and control. By creating systems that allow for customisation while ensuring that necessary compliance elements are always included, practices can ensure that they are meeting regulatory standards and providing a tailored and effective service to their clients.

Technology as an Enabler
Leading practices are exploring digital-first documentation that integrates seamlessly with client portals, leveraging interactive modelling tools that demonstrate strategy impacts in real-time. Importantly, data is captured once and moved through the advice process securely. While some practices incorporate video recordings of advice discussions to complement written documentation, others experiment with AI-powered summaries of key recommendations and rationale, which will meet the new advice documentation laws.

The most successful practices focus on integration capabilities between advice tools, CRM systems, and client portals. These practices build systems that generate dynamic, personalised content while maintaining robust compliance monitoring and risk management features. Data analytics capabilities are being used to drive continuous improvement, while client engagement tracking helps practices refine their approach based on actual usage and feedback.

Next Steps for Practices

1. Start planning now - don't wait for legislation
2. Review current tech capabilities against future needs
3. Map the ideal client experience journey for your clients (not someone else's)
4. Design prototype advice documents for adult learning styles
5. Test with select clients and refine the approach
6. Train team on new processes and tools

The Path Forward
The end of SOAs represents more than regulatory change - it's an opportunity to transform how we deliver advice. Practices that embrace this opportunity to redesign their advice process around client needs while maintaining robust compliance will be best positioned for future growth. The most successful firms will be those that can balance innovation with practicality, creating systems that enhance efficiency and effectiveness.

After 20 years of SOAs, now is a rare opportunity to take a genuinely blank canvas approach to advice documentation. By combining technology, client insights, and professional expertise, practices can create documentation systems that better serve clients and advisers while maintaining necessary compliance standards. The practices that seize this opportunity will likely be at the forefront of the profession's evolution.

For practices looking to get ahead of this change, the opportunity is clear: rethink advice documentation from first principles, focusing on how to best serve client needs while maintaining robust compliance. Those who embrace this transformation already aren't just saving time and money - they're building more engaging, effective advice businesses for the future.

Remember: the goal isn't to replicate current SOAs in video or digital format but to fundamentally rethink how we communicate and document advice to achieve better outcomes for clients and practices. Just because you've used the same software for 20 years doesn't mean it is right in 2025 and beyond.

The end of traditional SOAs opens the door to more innovative, efficient, and client-centric advice delivery. The practices that seize this opportunity to redesign their processes around client needs while maintaining robust compliance will be best positioned for future growth.

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