Compliance software should play a greater role in practice management, according to a new report from the Financial Planning Association (FPA). The recent compliance edition of the FPA-ActiFi 2010 Advisor Technology Reports suggests advisors should think holistically about compliance rather than view it as an ancillary practice activity. To that end, they should use the same tools, processes, and people to manage compliance as they do to manage other practice functions.

The report, based on an FPA survey of 338 advisors, found that the majority of advisors do not use compliance software in their practice. However, those that do say they’re satisfied with it. In addition, 68 percent of those surveyed said such software provides peace of mind, 64 percent report productivity gains or time savings, and 48 percent were able to enhance client service.

The report also revealed how advisors actually use their compliance software. Specifically, 62 percent use software to develop policy compliance manuals; nearly 49 percent to document that materials have been checked for compliance; and nearly 48% to assure that clients are receiving necessary disclosures.

“Compliance is a multi-faceted set of rules, processes, and behaviors,” said Marv Tuttle, Executive Director and CEO of the Financial Planning Association. “It’s important for financial planners to have the tools and resources they need not only to be compliant per the letter of the law, but (also to) capture the spirit of the law and use that as a strategic advantage in attracting and servicing clients.”

The FPA-ActiFi Advisor Technology Reports: Compliance Edition is the third in a series of seven technology research reports that compare various software and technology platforms. FPA members will receive a free copy of the report and non-members can purchase it for $495 through the FPA Research Center.

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