AICPA updates financial planner knowledge guidance
The American Institute of CPAs has updated the “body of knowledge” document that provides guidance to CPA financial planners on what they should know about taxes and other matters.
The updated Personal Financial Planning (PFP) Body of Knowledge, or BOK, outlines the competencies and information that CPAs who offer financial planning services need to know. One of the main changes in the document is in the tax-planning component, which has been updated from a stand-alone section and now has been integrated throughout all 12 service areas. The integration of tax throughout the document emphasizes the integrated nature of all financial planning services.
“CPA financial planners know firsthand that changes in any area of financial planning, including tax, can impact the other areas,” said AICPA PFS Credential Committee chair Susan Tillery in a statement. “Therefore, when change occurs, we are best able to identify the impact the change has on our clients' personal financial goals, and develop integrated financial planning strategies to keep them on track to reach those goals. The integrated planning approach in the Body of Knowledge means clients can continue to feel confident that their CPA financial planner can help them proactively address any potential changes to the tax code and adjust their personal financial plan accordingly.”
The new PFP Body of Knowledge has also added more clarity on several areas that have become increasingly prevalent for CPA financial planners, including elder, special needs, and chronic illness planning to address the needs of the aging population. The section on closely held business planning has been revamped to discuss compensation and benefits for employees more thoroughly, along with the potential impact of the business decisions upon the owner’s personal financial situation. The education planning explains more about the long-term financial impact of student loans, a crucial area for CPA financial planners and their clients to understand. The discussion on client relationship building covers topics including the importance of effective client communication, handling conflict, understanding and diagnosing client situations and the impact of family dynamics.
The AICPA also plans to release a Global Personal Financial Planning Body of Knowledge later this year. It will provide a detailed blueprint for CPA financial planners in the U.S. and abroad to incorporate financial planning competencies into the services offered to clients.