What is a financial services guide?

An FSG names the licensee and says whether the adviser is an authorised representative, with contact details and the licence number. It lists the services offered, such as financial product advice, dealing in a financial product, or arranging a deposit or insurance product, and whether advice will be personal or general. It explains remuneration: fees, commissions, ongoing platform fees, referral arrangements and estimated examples where possible.

It also discloses ownership, referral relationships and other conflicts of interest, sets out the internal complaints process and external dispute resolution membership (such as AFCA), summarises professional indemnity insurance, and explains how to obtain a written statement of advice and product disclosure statements. Headings to scan for: who we are, what we offer, how we are paid, complaints, and professional indemnity insurance. If any of these are missing or vague, treat it as a warning sign.

Firms that hold an Australian financial services licence, and their authorised representatives, must give an FSG to retail clients before any financial service is provided, or make the same information publicly available on their website as website disclosure information. Retail clients are individuals and small entities acquiring financial services for personal, household or small business purposes. Wholesale or sophisticated investors may fall outside the retail definition, although clear disclosure is good practice regardless.

Timing is simple: the FSG is due before any financial service is provided, or as soon as practicable if first contact happens earlier, for example at the first meeting or by email shortly after a phone call. It can be delivered in person, by post or electronically, as long as you can keep or print it. If you are not given one, check whether the firm publishes website disclosure information, then ask for the FSG, note the date, and consider raising it through the firm's complaints process.

The three documents do different jobs. The FSG is the initial disclosure about the firm: services, fees, conflicts and complaints, given before services start. A statement of advice (SOA) is the written record of personal advice prepared for you, covering your situation, the recommendations, costs, benefits and risks. A product disclosure statement (PDS) comes from the product issuer and explains a specific product's features, fees, risks and cooling-off rights.

In short: the FSG tells you about the adviser, the SOA is the adviser's advice to you, and the PDS explains the product. Keep copies of all three, along with emails and meeting notes, in case you ever need to complain.

Remuneration is where conflicts show up. Common models are fee for service, ongoing advice fees, commissions from product issuers, referral fees paid to introducers and, rarely, performance-linked fees. The FSG must set out how the firm is paid, including any commissions it is still permitted to receive. Conflicted remuneration, such as volume bonuses tied to product sales, is banned for advice given to retail clients rather than simply disclosed, so a firm that describes such payments in its FSG is worth questioning.

Good disclosure gives dollar examples, percentage ranges and the names of product providers that pay commissions. Vague wording such as "fees charged as agreed" or "we may receive commissions from product providers" is a prompt to ask for specifics: how much the advice will cost in dollars, and which providers pay the firm.