CFP Board Code and Standards Side by Side Comparison

SIDE-BY-SIDE
COMPARISON
OF CODE OF ETHICS AND STANDARDS OF
CONDUCT TO CURRENT STANDARDS
OF PROFESSIONAL CONDUCT
MARCH 2018, AS REVISED IN NOVEMBER 2018
SIDE-BY-SIDE COMPARISON
OF CODE OF ETHICS AND STANDARDS OF CONDUCT
TO CURRENT STANDARDS OF PROFESSIONAL CONDUCT
CODE AND STANDARDS UPDATED NOVEMBER 2018 CURRENT STANDARDS OF PROFESSIONAL CONDUCT
PREAMBLE CODE OF ETHICS AND PROFESSIONAL

RESPONSIBILITY
CFP Board’s Code of Ethics and Standards of
Conduct reflects the commitment that all CFP® Principle 1 – Integrity: Provide professional
professionals make to high standards of competency services with integrity.
and ethics. CFP Board’s Code and Standards benefits Principle 2 – Objectivity: Provide professional
and protects the public, provides standards for services objectively.
delivering financial planning, and advances financial
Principle 3 – Competence: Maintain the
planning as a distinct and valuable profession. knowledge and skill necessary to provide
Compliance with the Code and Standards is a professional services competently.
requirement of CFP® certification that is critical to the
integrity of the CFP® marks. Violations of the Code Principle 4 – Fairness: Be fair and reasonable
in all professional relationships. Disclose conflicts
and Standards may subject a CFP® professional to
of interest.
discipline.
Principle 5 – Confidentiality: Protect the
CODE OF ETHICS confidentiality of all client information.
A CFP® professional must: Principle 6 – Professionalism: Act in a manner that

demonstrates exemplary professional conduct.
1. Act with honesty, integrity, competence,
and diligence. Principle 7 – Diligence: Provide professional
services diligently.
2. Act in the client’s best interests.
3. Exercise due care.
4. Avoid or disclose and manage conflicts of interest.
5. Maintain the confidentiality and protect the
privacy of client information.
6. Act in a manner that reflects positively
on the financial planning profession and
CFP® certification.
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STANDARDS OF CONDUCT
A. Duties Owed to Clients Rule 1.4 A certificant shall at all times place the
interest of the client ahead of his or her own. When
1. Fiduciary Duty
the certificant provides financial planning or material
At all times when providing Financial Advice to a elements of financial planning, the certificant owes to
Client, a CFP® professional must act as a fiduciary, the client the duty of care of a fiduciary as defined by
and therefore, act in the best interests of the Client. CFP Board.
The following duties must be fulfilled:
Terminology: “Fiduciary.” One who acts in utmost
a. Duty of Loyalty. A CFP® professional must: good faith, in a manner he or she reasonably believes
to be in the best interest of the client.
i. Place the interests of the Client above
the interests of the CFP® professional Rule 4.5 In addition to the requirements of Rule
and the CFP® Professional’s Firm; 1.4, a certificant shall make and/or implement only
recommendations that are suitable for the client.
ii. Avoid Conflicts of Interest, or fully
disclose Material Conflicts of Interest to
the Client, obtain the Client’s informed
consent, and properly manage the
conflict; and
iii. Act without regard to the financial or
other interests of the CFP® professional,
the CFP® Professional’s Firm, or any
individual or entity other than the Client,
which means that a CFP® professional
acting under a Conflict of Interest
continues to have a duty to act in the
best interests of the Client and place
the Client’s interests above the CFP®
professional’s.
b. Duty of Care. A CFP® professional must act
with the care, skill, prudence, and diligence
that a prudent professional would exercise
in light of the Client’s goals, risk tolerance,
objectives, and financial and personal
circumstances.
c. Duty to Follow Client Instructions. A
CFP® professional must comply with
all objectives, policies, restrictions, and
other terms of the Engagement and all
reasonable and lawful directions of the
Client.
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2. INTEGRITY CODE OF ETHICS AND PROFESSIONAL

RESPONSIBILITY PRINCIPLE 1: INTEGRITY
a. A CFP® professional must perform
Professional Services with integrity. Provide professional services with integrity.
Integrity demands honesty and candor, Integrity demands honesty and candor which must
which may not be subordinated to personal not be subordinated to personal gain and advantage.
gain or advantage. Allowance may be made Certificants are placed in positions of trust by
for innocent error and legitimate differences clients, and the ultimate source of that trust is the
of opinion, but integrity cannot co-exist certificant’s personal integrity. Allowance can be
with deceit or subordination of principle. made for innocent error and legitimate differences of
b. A CFP® professional may not, directly or opinion, but integrity cannot co-exist with deceit or
indirectly, in the conduct of Professional subordination of one’s principles.
Services: Rule 4.1 A certificant shall treat prospective clients
i. Employ any device, scheme, or artifice to and clients fairly and provide professional services
defraud; with integrity and objectivity.
ii. Make any untrue statement of a Rule 2.1 A certificant shall not communicate, directly
material fact or omit to state a material or indirectly, to clients or prospective clients any
fact necessary in order to make the false or misleading information directly or indirectly
statements made, in the light of the related to the certificant’s professional qualifications
circumstances under which they were or services. A certificant shall not mislead any parties
made, not misleading; or about the potential benefits of the certificant’s
service. A certificant shall not fail to disclose or
iii. Engage in any act, practice, or course otherwise omit facts where that disclosure is
of business which operates or would necessary to avoid misleading clients.
operate as a fraud or deceit upon any
person.
3. COMPETENCE CODE OF ETHICS AND PROFESSIONAL

RESPONSIBILITY PRINCIPLE 3: COMPETENCE.
A CFP® professional must provide Professional
Services with competence, which means with relevant Maintain the knowledge and skill necessary to provide
knowledge and skill to apply that knowledge. When professional services competently. Competence
the CFP® professional is not sufficiently competent means attaining and maintaining an adequate
in a particular area to provide the Professional level of knowledge and skill, and application of
Services required under the Engagement, the CFP® that knowledge and skill in providing services to
professional must gain competence, obtain the clients. Competence also includes the wisdom to
assistance of a competent professional, limit or recognize the limitations of that knowledge and when
terminate the Engagement, and/or refer the Client to consultation with other professionals is appropriate
a competent professional. The CFP® professional shall or referral to other professionals necessary.
describe to the Client any requested Professional Certificants make a continuing commitment to
Services that the CFP® professional will not be learning and professional improvement.
providing.
Rule 4.2 A certificant shall offer advice only in those
areas in which he or she is competent to do so and
shall maintain competence in all areas in which he or
she is engaged to provide professional services.
4. DILIGENCE CODE OF ETHICS AND PROFESSIONAL

RESPONSIBILITY PRINCIPLE 7: DILIGENCE.
A CFP® professional must provide Professional
Services, including responding to reasonable Client Provide professional services diligently.
inquiries, in a timely and thorough manner.
Diligence is the provision of services in a reasonably
prompt and thorough manner, including the proper
planning for, and supervision of, the rendering of
professional services.
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5. DISCLOSE AND MANAGE CODE OF ETHICS AND PROFESSIONAL

CONFLICTS OF INTEREST RESPONSIBILITY PRINCIPLE 4: FAIRNESS
a. Disclose Conflicts. When providing Be fair and reasonable in all professional relationships.
Financial Advice, a CFP® professional must Disclose conflicts of interest.
make full disclosure of all Material Conflicts
Fairness requires impartiality, intellectual honesty and
of Interest with the CFP® professional’s
disclosure of material conflicts of interest. It involves
Client that could affect the professional
a subordination of one’s own feelings, prejudices
relationship. This obligation requires the
and desires so as to achieve a proper balance of
CFP® professional to provide the Client
conflicting interests. Fairness is treating others in the
with sufficiently specific facts so that
same fashion that you would want to be treated.
a reasonable Client would be able to
understand the CFP® professional’s Material
Conflicts of Interest and the business
Rule 2.2 A certificant shall disclose to a prospective
practices that give rise to the conflicts, and
client or client the following information: ...
give informed consent to such conflicts
or reject them. A sincere belief by a CFP® b. A general summary of likely conflicts
professional with a Material Conflict of of interest between the client and the
Interest that he or she is acting in the best certificant, the certificant’s employer or any
interests of the Client is insufficient to affiliates or third parties, including, but not
excuse failure to make full disclosure. limited to, information about any familial,
contractual or agency relationship of the
i. A CFP® professional must make full
certificant or the certificant’s employer
disclosure and obtain the consent of the
that has a potential to materially affect the
Client before providing any Financial
relationship.
Advice regarding which the CFP®
professional has a Material Conflict of
Interest.
ii. In determining whether the disclosure
about a Material Conflict of Interest
provided to the Client was sufficient to
infer that a Client has consented to a
Material Conflict of Interest, CFP Board
will evaluate whether a reasonable Client
receiving the disclosure would have
understood the conflict and how it could
affect the advice the Client will receive
from the CFP® professional. The greater
the potential harm the conflict presents
to the Client, and the more significantly
a business practice that gives rise to
the conflict departs from commonly
accepted practices among CFP®
professionals, the less likely it is that CFP
Board will infer informed consent absent
clear evidence of informed consent.
Ambiguity in the disclosure provided to
the Client will be interpreted in favor of
the Client.
iii. Evidence of oral disclosure of a conflict
will be given such weight as CFP Board
in its judgment deems appropriate.
Written consent to a conflict is not
required.
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b. Manage Conflicts. A CFP® professional

must adopt and follow business practices
reasonably designed to prevent Material
Conflicts of Interest from compromising
the CFP® professional’s ability to act in the
Client’s best interests.
6. SOUND AND OBJECTIVE CODE OF ETHICS AND PROFESSIONAL

PROFESSIONAL JUDGMENT RESPONSIBILITY PRINCIPLE 2: OBJECTIVITY.
A CFP® professional must exercise professional Provide professional services objectively. Objectivity
judgment on behalf of the Client that is not requires intellectual honesty and impartiality.
subordinated to the interest of the CFP® professional Regardless of the particular service rendered or the
or others. A CFP® professional may not solicit or capacity in which a certificant functions, certificants
accept any gift, gratuity, entertainment, non-cash should protect the integrity of their work, maintain
compensation, or other consideration that reasonably objectivity and avoid subordination of their judgment.
could be expected to compromise the CFP®
Rule 4.4 A certificant shall exercise reasonable
professional’s objectivity.
and prudent professional judgment in providing
professional services to clients.
7. PROFESSIONALISM CODE OF ETHICS AND PROFESSIONAL

RESPONSIBILITY PRINCIPLE 6: PROFESSIONALISM
A CFP® professional must treat Clients, prospective
Clients, fellow professionals, and others with dignity, Act in a manner that demonstrates exemplary
courtesy, and respect. professional conduct.
Professionalism requires behaving with dignity and
courtesy to clients, fellow professionals, and others
in business-related activities. Certificants cooperate
with fellow certificants to enhance and maintain the
profession’s public image and improve the quality of
services.
8. COMPLY WITH THE LAW Rule 4.3 A certificant shall be in compliance with
applicable regulatory requirements governing
a. A CFP® professional must comply with
professional services provided to the client.
the laws, rules, and regulations governing
Professional Services.
b. A CFP® professional may not intentionally
or recklessly participate or assist in another
person’s violation of these Standards or
the laws, rules, or regulations governing
Professional Services.
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9. CONFIDENTIALITY AND PRIVACY CODE OF ETHICS AND PROFESSIONAL

RESPONSIBILITY PRINCIPLE 5: CONFIDENTIALITY
a. A CFP® professional must keep confidential
and may not disclose any non-public Protect the confidentiality of all client information.
personal information about any prospective,
Confidentiality means ensuring that information is
current, or former Client (”client”), except
accessible only to those authorized to have access.
that the CFP® professional may disclose
A relationship of trust and confidence with the client
information:
can only be built upon the understanding that the
i. For ordinary business purposes: client’s information will remain confidential.
a. With the client’s consent, so long Rule 3.1 A certificant shall treat information as
as the client has not withdrawn the confidential except as required in response to proper
consent; legal process; as necessitated by obligations to a
certificant’s employer or partners; as required to
b. To a CFP® Professional’s Firm or
defend against charges of wrongdoing; in connection
other persons with whom the CFP®
with a civil dispute; or as needed to perform the
professional is providing services to
services.
or for the client, when necessary to
perform those services;
c. As necessary to provide information
to the CFP® professional’s attorneys,
accountants, and auditors; and
d. To a person acting in a representative
capacity on behalf of the client;
ii. For legal and enforcement purposes:

a. To law enforcement authorities
concerning suspected unlawful
activities, to the extent permitted by
the law;
b. As required to comply with federal,
state, or local law;
c. As required to comply with a
properly authorized civil, criminal,
or regulatory investigation or
examination, or subpoena or
summons, by a governmental
authority;
d. As necessary to defend against
allegations of wrongdoing made by a
governmental authority;
e. As necessary to present a civil claim
against, or defend against a civil
claim raised by, a client;
f. As required to comply with a request
from CFP Board concerning an
investigation or adjudication; and
g. As necessary to provide information
to professional organizations that
are assessing the CFP® professional’s
compliance with professional
standards.
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b. A CFP® professional may not use any non-

public personal information about a client
for his or her direct or indirect personal
benefit, whether or not it causes detriment
to the client, unless the client consents.
c. A CFP® professional, either directly or Rule 3.2 A certificant shall take prudent steps to
through the CFP® professional’s Firm, protect the security of information and property,
must take reasonable steps to protect including the security of stored information, whether
the security of non-public personal physically or electronically, that is within the
information about any client, including the certificant’s control.
security of information stored physically
or electronically, from unauthorized access
that could result in harm or inconvenience
to the client.
d. A CFP® professional, either directly or
through the CFP® Professional’s Firm, must
adopt and implement policies regarding
the protection, handling, and sharing of a
client’s non-public personal information
and must provide a client with written
notice of those policies at the time of the
Engagement and thereafter not less than
annually (at least once in any 12 month
period) unless (i) the CFP® professional’s
policies have not changed since the last
notice sent to a client; and (ii) the CFP®
professional does not disclose non-
public personal information other than as
permitted without a client’s consent.
e. A CFP® professional shall be deemed
to comply with this Section if the CFP®
Professional’s Firm is subject to, and the
CFP® professional complies with, Regulation
S-P under the federal securities laws or
substantially equivalent federal or state
laws or rules.
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10. PROVIDE INFORMATION TO A CLIENT Rule 1.1 The certificant and the prospective client or
client shall mutually agree upon the services to be
a. When Providing Financial Advice.
provided by the certificant.
When providing or agreeing to provide
Financial Advice that does not require Rule 1.2 If the certificant’s services include financial
Financial Planning in accordance with the planning or material elements of financial planning,
Practice Standards, a CFP® professional prior to entering into an agreement, the certificant
must provide the following information shall provide written information or discuss with the
to the Client, prior to or at the time of prospective client or client the following:
the Engagement, and document that the
a. The obligations and responsibilities of each
information has been provided to the Client:
party under the agreement with respect to:
i. A description of the services and
1. Defining goals, needs and objectives,
products to be provided;
2. Gathering and providing appropriate
ii. How the Client pays for the products
data,
and services, and a description of
the additional types of costs that the 3. Examining the result of the current
Client may incur, including product course of action without changes,
management fees, surrender charges,
4. The formulation of any recommended
and sales loads;
actions,
iii. How the CFP® professional, the CFP®
5. Implementation responsibilities, and
Professional’s Firm, and any Related
Party are compensated for providing the 6. Monitoring responsibilities.
products and services;
b. Compensation that any party to the
iv. The existence of any public discipline agreement or any legal affiliate to a party to
or bankruptcy, and the location(s), if the agreement will or could receive under
any, of the webpages of all relevant the terms of the agreement; and factors or
public websites of any governmental terms that determine costs, how decisions
authority, self-regulatory organization, benefit the certificant and the relative
or professional organization that sets benefit to the certificant.
forth the CFP® professional’s public
disciplinary history or any personal c. Terms under which the agreement permits
bankruptcy or business bankruptcy the certificant to offer proprietary products.
where the CFP® professional was a d. Terms under which the certificant will
Control Person; use other entities to meet any of the
v. The information required under Section agreement’s obligations.
A.5.a. (Conflict of Interest Disclosure);
Rule 1.3 If the services include financial planning or
vi. The information required under Section material elements of financial planning, the certificant
A.9.d. (Written Notice Regarding Non- or the certificant’s employer shall enter into a written
Public Personal Information); agreement governing the financial planning services
(“Agreement”). The Agreement shall specify:
vii. The information required under Section
A.13.a.ii. (Disclosure of Economic a. The parties to the Agreement,
Benefit for Referral or Engagement of
b. The date of the Agreement and its duration,
Additional Persons); and
c. How and on what terms each party can
viii. Any other information about the CFP®
terminate the Agreement, and
professional or the CFP® Professional’s
Firm that is Material to a Client’s d. The services to be provided as part of the
decision to engage or continue to Agreement.
engage the CFP® professional or the
CFP® Professional’s Firm.
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b. When Providing Financial Planning. When The Agreement may consist of multiple written
providing or required to provide Financial documents. Written documentation that includes
Planning in accordance with the Practice the items above and is used by a certificant or
Standards, a CFP® professional must provide certificant’s employer in compliance with state
the following information to the Client, prior or federal law, or the rules or regulations of any
to or at the time of the Engagement, in one applicable self-regulatory organization, such as the
or more written documents: Securities and Exchange Commission’s Form ADV
or other disclosure documents, shall satisfy the
i. The information required to be provided
requirements of this Rule.
in Section A.10.a.i.-iv. and vi -viii.; and
ii. The terms of the Engagement Rule 2.2 A certificant shall disclose to a prospective
between the Client and the CFP® client or client the following information:
professional or the CFP® Professional’s a. An accurate and understandable
Firm, including the Scope of description of the compensation
Engagement and any limitations, the arrangements being offered. This
period(s) during which the services description must include:
will be provided, and the Client’s
responsibilities. A CFP® professional • Information related to costs and
is responsible for implementing, compensation to the certificant and/or
monitoring, and updating the Financial the certificant’s employer, and
Planning recommendation(s) unless • Terms under which the certificant and/
specifically excluded from the Scope of or the certificant’s employer may receive
Engagement. any other sources of compensation, and
c. Updating Information. A CFP® professional if so, what the sources of these payments
has an ongoing obligation to provide are and on what they are based.
to the Client any information that is b. A general summary of likely conflicts
a Material change or update to the of interest between the client and the
information required to be provided to the certificant, the certificant’s employer or any
Client. Material changes and updates to affiliates or third parties, including, but not
public disciplinary history or bankruptcy limited to, information about any familial,
information must be disclosed to the contractual or agency relationship of the
Client within ninety days, together with the certificant or the certificant’s employer
location(s) of the relevant webpages. that has a potential to materially affect the
relationship.
c. Any information about the certificant or the
certificant’s employer that could reasonably
be expected to materially affect the client’s
decision to engage the certificant that the
client might reasonably want to know in
establishing the scope and nature of the
relationship, including but not limited to
information about the certificant’s areas of
expertise.
d. Contact information for the certificant and,
if applicable, the certificant’s employer.
e. If the services include financial planning
or material elements of financial planning,
these disclosures must be in writing. The
written disclosures may consist of multiple
written documents. Written disclosures
used by a certificant or certificant’s
employer that includes the items listed
above, and are used in compliance
with state or federal laws, or the rules
or requirements of any applicable self-
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regulatory organization, such as the

Securities and Exchange Commission’s
Form ADV or other disclosure documents,
shall satisfy the requirements of this Rule.
The certificant shall timely disclose to the client any
material changes to the above information.
Practice Standard 100-1: Defining the Scope of
the Engagement.
The financial planning practitioner and the client shall
mutually define the scope of the engagement before
any financial planning service is provided.
Explanation of this Practice Standard
Prior to providing any financial planning service,
the financial planning practitioner and the client
shall mutually define the scope of the engagement.
The process of “mutually-defining” is essential in
determining what activities may be necessary to
proceed with the engagement.
This process is accomplished in financial planning
engagements by:
1. Identifying the service(s) to be provided;
2. Disclosing the practitioner’s material
conflict(s) of interest;
3. Disclosing the practitioner’s
compensation arrangement(s);
4. Determining the client’s and the
practitioner’s responsibilities;
5. Establishing the duration of the
engagement; and
Providing any additional information necessary to
define or limit the scope.
The scope of the engagement may include one or
more financial planning subject areas. It is acceptable
to mutually define engagements in which the scope
is limited to specific activities. Mutually defining the
scope of the engagement serves to establish realistic
expectations for both the client and the practitioner.
This Practice Standard does not require the scope of
the engagement to be in writing. However, as noted in
the “Relationship” section, which follows, there may be
certain disclosures that are required to be in writing.
As the relationship proceeds, the scope may change
by mutual agreement.
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11. DUTIES WHEN COMMUNICATING WITH A CLIENT Rule 2.1 A certificant shall not communicate, directly
A CFP® professional must provide a Client with or indirectly, to clients or prospective clients any
accurate information, in accordance with the false or misleading information directly or indirectly
Engagement, and in response to reasonable Client related to the certificant’s professional qualifications
requests, in a manner and format that a Client or services. A certificant shall not mislead any parties
reasonably may be expected to understand. about the potential benefits of the certificant’s
service. A certificant shall not fail to disclose or
otherwise omit facts where that disclosure is
necessary to avoid misleading clients.
12. DUTIES WHEN REPRESENTING

COMPENSATION METHOD
A CFP® professional may not make false or misleading
representations regarding the CFP® professional’s
or the CFP® Professional’s Firm’s method(s) of
compensation.
a. Specific Representations
i. Fee-Only. A CFP® professional may Terminology: “Fee-only.” A certificant may describe
represent his or her compensation his or her practice as “fee-only” if, and only if, all of
method as “fee-only” only if: the certificant’s compensation from all of his or her
a. The CFP® professional and the CFP® client work comes exclusively from the clients in the
Professional’s Firm receive no Sales- form of fixed, flat, hourly, percentage or performance-
Related Compensation; and based fees.
b. Related Parties receive no Sales-

Related Compensation in connection
with any Professional Services
the CFP® professional or the CFP®
Professional’s Firm provides to Clients.
ii. Fee-Based. CFP Board uses the term
“fee and commission” to describe the
compensation method of those who
receive both fees and Sales-Related
Compensation. A CFP® professional
who represents that his or her or the
CFP® Professional’s Firm’s compensation
method is “fee-based” or any other
similar term that is not fee-only:
a. May not use the term in a manner
that suggests the CFP® professional
or the CFP® Professional’s Firm is fee-
only; and
b. Must clearly state that either the
CFP® professional or the CFP®
Professional’s Firm earns fees
and commissions, or that the
CFP® professional or the CFP®
Professional’s Firm are not fee-only.
b. Sales-Related Compensation. Sales-
Related Compensation is more than a de
minimis economic benefit, including any
bonus or portion of compensation, resulting
from a Client purchasing or selling Financial
Assets, from a Client holding Financial
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Assets for purposes other than receiving Terminology: “Commission” denotes the
Financial Advice, or from the referral of a compensation generated from a transaction
Client to any person or entity other than involving a product or service and received by an
the CFP® Professional’s Firm. Sales-Related agent or broker, usually calculated as a percentage
Compensation includes, for example, on the amount of his or her sales or purchase
commissions, trailing commissions, 12b-1 transactions. This includes 12(b)1 fees, trailing
fees, spreads, transaction fees, revenue commissions, surrender charges and contingent
sharing, referral or solicitor fees, or similar deferred sales charges.
consideration. Sales-Related Compensation
Terminology: “Compensation” is any non-trivial
does not include:
economic benefit, whether monetary or non-
i. Soft dollars (any research or other monetary, that a certificant or related party receives
benefits received in connection with or is entitled to receive for providing professional
Client brokerage that qualifies for the activities.
“safe harbor” of Section 28(e) of the
Securities Exchange Act of 1934);
ii. Reasonable and customary fees for
custodial or similar administrative
services if the fee or amount of the fee is
not determined based on the amount or
value of Client transactions;
iii. Non-monetary benefits provided by
another service provider, including
a custodian, that benefit the CFP®
professional’s Clients by improving
the CFP® professional’s delivery of
Professional Services, and that are not
determined based on the amount or
value of Client transactions;
iv. Reasonable and customary fees for
Professional Services, other than for
solicitations and referrals, the CFP®
professional or CFP® Professional’s Firm
provides to a Client that are collected
and distributed by another service
provider, including under a Turnkey
Asset Management Platform; or
v. A fee the Related Party solicitor receives
for soliciting clients for the CFP®
Firm.
c. Related Party. A person or business entity
(including a trust) whose receipt of Sales-
Related Compensation a reasonable CFP®
professional would view as directly or
indirectly benefiting the CFP® professional
or the CFP® Professional’s Firm, including,
for example, as a result of the CFP®
professional’s ownership stake in the
business entity. There is a rebuttable
presumption that a Related Party includes:
i. Family Members. A member of the CFP®
professional’s Family and any business
entity that the Family or members of the
Family Control; and
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ii. Business Entities. A business entity

that the CFP® professional or the CFP®
Professional’s Firm Controls, or that
is Controlled by or is under common
Control with, the CFP® Professional’s Firm.
d. In Connection with any Professional
Services. Sales-Related Compensation
received by a Related Party is “in
connection with any Professional Services”
if it results, directly or indirectly, from
Client transactions referred or facilitated
by the CFP® professional or the CFP®
Professional’s Firm.
e. Safe Harbor for Related Parties. Sales-
Related Compensation received by a
Related Party is not “in connection with
any Professional Services” if the CFP®
Firm adopts and implements policies
and procedures reasonably designed to
prevent the CFP® professional or the CFP®
Professional’s Firm from recommending
that any Client purchase Financial Assets
from or through, or refer any Clients to, the
Related Party.
f. Misrepresentations by a CFP®
Professional’s Firm. A CFP® professional
who Controls the CFP® Professional’s Firm
may not allow the CFP® Professional’s Firm
to make a representation of compensation
method that would be false or misleading
if made by the CFP® professional. A CFP®
professional who does not Control the CFP®
Professional’s Firm must correct a CFP®
Professional’s Firm’s misrepresentations
of compensation method by accurately
representing the CFP® professional’s
compensation method to the CFP®
professional’s Clients.
13. DUTIES WHEN RECOMMENDING, ENGAGING, No equivalent in Current Standards.

AND WORKING WITH ADDITIONAL PERSONS
a. When engaging or recommending the
selection or retention of additional persons
to provide financial or Professional Services
for a Client, a CFP® professional must:
i. Have a reasonable basis for the
recommendation or Engagement based
on the person’s reputation, experience,
and qualifications;
ii. Disclose to the Client, at the time of
the recommendation or prior to the
Engagement, any arrangement by
which someone who is not the Client
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will compensate or provide some other

material economic benefit to the CFP®
professional, the CFP® Professional’s
Firm, or a Related Party for the
recommendation or Engagement; and
iii. When engaging a person to provide
services for a Client, exercise reasonable
care to protect the Client’s interests.
b. When working with another financial or
Professional Services provider on behalf of
a Client, a CFP® professional must:
i. Communicate with the other provider
about the scope of their respective
services and the allocation of
responsibility between them; and
ii. Inform the Client in a timely manner if
the CFP® professional has a reasonable
belief that the other provider’s services
were not performed in accordance with
the scope of services to be provided and
the allocation of responsibilities.
14. DUTIES WHEN SELECTING, USING, No equivalent in Current Standards.

AND RECOMMENDING TECHNOLOGY
a. A CFP® professional must exercise
reasonable care and judgment when
selecting, using, or recommending any
software, digital advice tool, or other
technology while providing Professional
Services to a Client.
b. A CFP® professional must have a reasonable
level of understanding of the assumptions
and outcomes of the technology employed.
c. A CFP® professional must have a
reasonable basis for believing that the
technology produces reliable, objective, and
appropriate outcomes.
15. REFRAIN FROM BORROWING OR LENDING Rule 3.8 A certificant shall not commingle a client’s
MONEY AND COMMINGLING FINANCIAL ASSETS property with the property of the certificant or
the certificant’s employer, unless the commingling
a. A CFP® professional may not, directly or
is permitted by law or is explicitly authorized and
indirectly, borrow money from or lend
defined in a written agreement between the parties.
money to a Client unless:
Rule 3.9 A certificant shall not commingle a client’s
i. The Client is a member of the CFP®
property with other clients’ property unless the
professional’s Family; or
commingling is permitted by law or the certificant
ii. The lender is a business organization or has both explicit written authorization to do so from
legal entity in the business of lending each client involved and sufficient record-keeping to
money. track each client’s assets accurately.
b. A CFP® professional may not commingle a
Client’s Financial Assets with the Financial
Assets of the CFP® professional or the CFP®
15
Rule 3.6 A certificant shall not borrow money

from a client. Exceptions to this Rule include:
a. The client is a member of the certificant’s
immediate family, or
b. The client is an institution in the business
of lending money and the borrowing is
unrelated to the professional services
performed by the certificant.
Rule 3.7 A certificant shall not lend money to a client.

Exceptions to this Rule include:
a. The client is a member of the certificant’s
immediate family, or
b. The certificant is an employee of an
institution in the business of lending money
and the money lent is that of the institution,
not the certificant.
B. FINANCIAL PLANNING AND APPLICATION Terminology: “Personal financial planning” or

OF THE PRACTICE STANDARDS FOR THE “financial planning” denotes the process of
FINANCIAL PLANNING PROCESS determining whether and how an individual can
meet life goals through the proper management of
1. Financial Planning Definition. Financial Planning
financial resources. Financial planning integrates the
is a collaborative process that helps maximize a
financial planning process with the financial planning
Client’s potential for meeting life goals through
subject areas.
Financial Advice that integrates relevant elements
of the Client’s personal and financial circumstances. [Portion of the definition removed and referenced
below]
Financial planning may occur even if the material
elements are not provided to a client simultaneously,
are delivered over a period of time, or are delivered as
distinct subject areas. It is not necessary to provide a
written financial plan to engage in financial planning.
2. Examples of Relevant Elements of the Client’s Terminology: “Personal financial planning subject
Personal and Financial Circumstances. Relevant areas” or “financial planning subject areas” denotes
elements of personal and financial circumstances the basic subject fields covered in the financial
vary from Client to Client, and may include the planning process which typically include, but are not
Client’s need for or desire to: develop goals, man- limited to:
age assets and liabilities, manage cash flow, iden-
• Financial statement preparation and analysis
tify and manage risks, identify and manage the
(including cash flow analysis/planning and
financial effect of health considerations, provide
budgeting)
for educational needs, achieve financial security,
preserve or increase wealth, identify tax consider- • Insurance planning and risk management
ations, prepare for retirement, pursue philanthropic
• Employee benefits planning
interests, and address estate and legacy matters.
• Investment planning
• Income tax planning
• Retirement planning
• Estate planning
16
3. Application of Practice Standards. The Practice Description of Practice Standards

Standards set forth the financial planning process. ...Compliance with the Practice Standards is mandatory
A CFP® professional must comply with the Practice for certificants whose services include financial
Standards when: planning or material elements of financial planning...
a. The CFP® professional agrees to provide Compliance with Practice Standards
or provides (i) Financial Planning; or (ii)
Financial Advice that requires integration of The practice of financial planning consistent with
relevant elements of the Client’s personal these Practice Standards is required for certificants
and/or financial circumstances in order to act who are financial planning practitioners. The Practice
in the Client’s best interest (“Financial Advice Standards are used by CFP Board’s Disciplinary
that Requires Financial Planning”); or and Ethics Commission and Appeals Committee in
evaluating the certificant’s conduct to determine
b. The Client has a reasonable basis to believe if any provision of the Standards of Professional
the CFP® professional will provide or has Conduct have been violated, based on the
provided Financial Planning. Disciplinary Rules established by CFP Board.
Terminology: “Personal financial planning process”
or “financial planning process” denotes the process
which typically includes, but is not limited to, some or
all of these six steps:
• Establishing and defining the client-planner
relationship,
• Gathering client data including goals,
• Analyzing and evaluating the client’s current
financial status,
• Developing and presenting recommendations
and/or alternatives,
• Implementing the recommendations, and
• Monitoring the recommendations.
4. Integration Factors. Among the factors that CFP Terminology: “Personal financial planning” or
Board will weigh in determining whether a CFP® “financial planning” ...In determining whether the
professional has agreed to provide or provided certificant is providing financial planning or material
Financial Advice that Requires Financial Planning elements of financial planning, factors that may be
are: considered include, but are not limited to:
a. The number of relevant elements of • The client’s understanding and intent in
the Client’s personal and financial engaging the certificant.
circumstances that the Financial Advice • The degree to which multiple financial planning
may affect; subject areas are involved.
b. The portion and amount of the Client’s • The comprehensiveness of data gathering.
Financial Assets that the Financial Advice
may affect; • The breadth and depth of recommendations.
c. The length of time the Client’s personal and [Portion of the definition removed and referenced
financial circumstances may be affected by above]
the Financial Advice;
d. The effect on the Client’s overall exposure
to risk if the Client implements the Financial
Advice; and
e. The barriers to modifying the actions taken
to implement the Financial Advice.
17
5. CFP Board Evaluation. In a disciplinary proceeding No equivalent in Current Standards.

in which a CFP® professional denies CFP Board’s
allegation that the CFP® professional was required
to comply with the Practice Standards, the CFP®
professional must demonstrate that compliance
with the Practice Standards was not required.
6. No Client Agreement to Engage for Financial No equivalent in Current Standards.

Planning. If a CFP® professional otherwise must
comply with the Practice Standards, but the Client
does not agree to engage the CFP® professional to
provide Financial Planning, the CFP® professional
must either:
a. Not enter into the Engagement;
b. Limit the Scope of Engagement to services
that do not require application of the
Practice Standards, and describe to the
Client the services the Client requests
that the CFP® professional will not be
performing;
c. Provide the requested services after
informing the Client how Financial
Planning would benefit the Client and
how the decision not to engage the CFP®
professional to provide Financial Planning
may limit the CFP® professional’s Financial
Advice, in which case the CFP® professional
is not required to comply with the Practice
Standards; or
d. Terminate the Engagement.
18
C. PRACTICE STANDARDS FOR THE GATHERING CLIENT DATA

FINANCIAL PLANNING PROCESS
Practice Standard 200-2: Obtaining Quantitative
In complying with the Practice Standards, a CFP® Information and Documents
professional must act prudently in documenting
The financial planning practitioner shall obtain
information, as the facts and circumstances
sufficient quantitative information and documents
require, taking into account the significance of the
about a client relevant to the scope of the
information, the need to preserve the information
engagement before any recommendation is made
in writing, the obligation to act in the Client’s best
and/or implemented.
interest, and the CFP® Professional’s Firm’s policies
and procedures. Explanation of this Practice Standard
1. Understanding the Client’s Personal and Financial Prior to making recommendations to the client and
Circumstances depending on the scope of the engagement, the
financial planning practitioner shall determine what
a. Obtaining Qualitative and Quantitative
quantitative information and documents are sufficient
Information. A CFP® professional must
and relevant.
describe to the Client the qualitative
and quantitative information concerning The practitioner shall obtain sufficient and relevant
the Client’s personal and financial quantitative information and documents pertaining
circumstances needed to fulfill the Scope of to the client’s financial resources, obligations and
Engagement and collaborate with the Client personal situation. This information may be obtained
to obtain the information. directly from the client or other sources such as
interview(s), questionnaire(s), client records and
i. Examples of qualitative or subjective
documents.
information include the Client’s health,
life expectancy, family circumstances, The practitioner shall communicate to the client
values, attitudes, expectations, earnings a reliance on the completeness and accuracy of
potential, risk tolerance, goals, needs, the information provided and that incomplete or
priorities, and current course of action. inaccurate information will impact conclusions and
recommendations.
ii. Examples of quantitative or objective
information include the Client’s age, If the practitioner is unable to obtain sufficient and
dependents, other professional advisors, relevant quantitative information and documents to
income, expenses, cash flow, savings, form a basis for recommendations, the practitioner
assets, liabilities, available resources, shall either:
liquidity, taxes, employee benefits,
a. Restrict the scope of the engagement to
government benefits, insurance
those matters for which sufficient and
coverage, estate plans, education and
relevant information is available; or
retirement accounts and benefits, and
capacity for risk. b. Terminate the engagement.
b. Analyzing Information. A CFP® The practitioner shall communicate to the client
professional must analyze the qualitative any limitations on the scope of the engagement, as
and quantitative information to assess well as the fact that this limitation could affect the
the Client’s personal and financial conclusions and recommendations.
circumstances.
c. Addressing Incomplete Information. If Rule 3.3 A certificant shall obtain the information
unable to obtain information necessary to necessary to fulfill his or her obligations. If a
fulfill the Scope of Engagement, the CFP® certificant cannot obtain the necessary information,
professional must either limit the Scope of the certificant shall inform the prospective client or
Engagement to those services the CFP® client of any and all material deficiencies.
professional is able to provide or terminate
the Engagement.
19
2. Identifying and Selecting Goals Practice Standard 200-1: Determining a Client’s

Personal and Financial Goals, Needs, and Priorities.
a. Identifying Potential Goals. A CFP®
professional must discuss with the Client The financial planning practitioner and the client
the CFP® professional’s assessment shall mutually define the client’s personal and
of the Client’s financial and personal financial goals, needs and priorities that are relevant
circumstances, and help the Client identify to the scope of the engagement before any
goals, noting the effect that selecting a recommendation is made and/or implemented.
particular goal may have on other goals.
In helping the Client identify goals, the
CFP® professional must discuss with the Prior to making recommendations to the client, the
Client, and apply, reasonable assumptions financial planning practitioner and the client shall
and estimates. These may include life mutually define the client’s personal and financial
expectancy, inflation rates, tax rates, goals, needs and priorities. In order to arrive at such
investment returns, and other Material a definition, the practitioner will need to explore
assumptions and estimates. the client’s values, attitudes, expectations, and time
horizons as they affect the client’s goals, needs
b. Selecting and Prioritizing Goals. A CFP®
and priorities. The process of “mutually-defining”
professional must help the Client select and
is essential in determining what activities may be
prioritize goals. The CFP® professional must
necessary to proceed with the client engagement.
discuss with the Client any goals the Client
Personal values and attitudes shape the client’s
has selected that the CFP® professional
goals and objectives and the priority placed on
believes are not realistic.
them. Accordingly, these goals and objectives must
be consistent with the client’s values and attitudes
in order for the client to make the commitment
necessary to accomplish them.
Goals and objectives provide focus, purpose, vision
and direction for the financial planning process. It
is important to determine clear, and measurable
objectives that are relevant to the scope of the
engagement. The role of the practitioner is to
facilitate the goal-setting process in order to
clarify, with the client, goals and objectives. When
appropriate, the practitioner shall try to assist clients
in recognizing the implications of unrealistic goals
and objectives.
This Practice Standard addresses only the tasks of
determining the client’s personal and financial goals,
needs and priorities; assessing the client’s values,
attitudes and expectations; and determining the
client’s time horizons. These areas are subjective and
the practitioner’s interpretation is limited by what the
client reveals.
20
3. Analyzing the Client’s Current Course of Action Analyzing and Evaluating the Client’s Financial
and Potential Alternative Course(s) of Action Status Practice Standard 300-1: Analyzing
and Evaluating the Client’s Information
a. Analyzing Current Course of Action. A
CFP® professional must analyze the Client’s A financial planning practitioner shall analyze the
current course of action, including the information to gain an understanding of the client’s
material advantages and disadvantages of financial situation and then evaluate to what extent
the current course and whether the current the client’s goals, needs and priorities can be met by
course maximizes the potential for meeting the client’s resources and current course of action.
the Client’s goals. Explanation of this Practice Standard
b. Analyzing Potential Alternative Courses Prior to making recommendations to a client, it is
of Action. Where appropriate, a CFP® necessary for the financial planning practitioner to
professional must consider and analyze one assess the client’s financial situation and to determine
or more potential alternative courses of the likelihood of reaching the stated objectives by
action, including their material advantages continuing present activities.
and disadvantages of each alternative,
whether each alternative helps maximize The practitioner will utilize client-specified, mutually
the potential for meeting the Client’s goals, agreed upon, and/or other reasonable assumptions.
and how each alternative integrates the Both personal and economic assumptions must
relevant elements of the Client’s personal be considered in this step of the process. These
and financial circumstances. assumptions may include, but are not limited to, the
following:
• Personal assumptions, such as: retirement
age(s), life expectancy(ies), income needs, risk
factors, time horizon and special needs; and
• Economic assumptions, such as: inflation rates,
tax rates and investment returns.
Analysis and evaluation are critical to the financial
planning process. These activities form the
foundation for determining strengths and weaknesses
of the client’s financial situation and current course
of action. These activities may also identify other
issues that should be addressed. As a result, it may be
appropriate to amend the scope of the engagement
and/or to obtain additional information.
Practice Standard 400-1: Identifying and Evaluating
Financial Planning Alternative(s)
The financial planning practitioner shall consider
sufficient and relevant alternatives to the client’s
current course of action in an effort to reasonably
meet the client’s goals, needs and priorities.
After analyzing the client’s current situation
(Practice Standard 300-1) and prior to developing
and presenting the recommendation(s) (Practice
Standards 400-2 and 400-3) the financial planning
practitioner shall identify alternative actions. The
practitioner shall evaluate the effectiveness of such
actions in reasonably meeting the client’s goals,
needs and priorities.
This evaluation may involve, but is not limited to,
considering multiple assumptions, conducting
research or consulting with other professionals. This
process may result in a single alternative, multiple
21
alternatives or no alternative to the client’s current

course of action.
In considering alternative actions, the practitioner
shall recognize and, as appropriate, take into account
his or her legal and/or regulatory limitations and level
of competency in properly addressing each of the
client’s financial planning issues.
More than one alternative may reasonably meet
the client’s goals, needs and priorities. Alternatives
identified by the practitioner may differ from those
of other practitioners or advisers, illustrating the
subjective nature of exercising professional judgment.
4. Developing the Financial Planning Practice Standard 400-2: Developing the

Recommendation(s) Financial Planning Recommendation(s)
From the potential courses of action, a The financial planning practitioner shall develop
CFP® professional must select one or more the recommendation(s) based on the selected
recommendations designed to maximize the potential alternative(s) and the current course of action in an
for meeting the Client’s goals. The recommendation effort to reasonably meet the client’s goals, needs
may be to continue the Client’s current course of and priorities.
action. For each recommendation selected, the CFP®
professional must consider the following information:
After identifying and evaluating the alternative(s) and
a. The assumptions and estimates used to
the client’s current course of action, the practitioner
develop the recommendation;
shall develop the recommendation(s) expected
b. The basis for making the recommendation, to reasonably meet the client’s goals, needs and
including how the recommendation priorities. A recommendation may be an independent
is designed to maximize the potential action or a combination of actions which may need to
to meet the Client’s goals, the be implemented collectively.
anticipated material effects of the
The recommendation(s) shall be consistent with and
recommendation on the Client’s financial
will be directly affected by the following:
and personal circumstances, and how
the recommendation integrates relevant • Mutually defined scope of the engagement;
elements of the Client’s personal and
• Mutually defined client goals, needs and
financial circumstances;
priorities;
c. The timing and priority of the
• Quantitative data provided by the client;
recommendation; and
• Personal and economic assumptions;
d. Whether the recommendation is
independent or must be implemented with • Practitioner’s analysis and evaluation of client’s
another recommendation. current situation; and
• Alternative(s) selected by the practitioner.
A recommendation may be to continue the current
course of action. If a change is recommended, it
may be specific and/or detailed or provide a general
direction. In some instances, it may be necessary for
the practitioner to recommend that the client modify
a goal.
The recommendations developed by the practitioner
may differ from those of other practitioners or
advisers, yet each may reasonably meet the client’s
goals, needs and priorities.
22
5. Presenting the Financial Planning Practice Standard 400-3: Presenting the

Recommendation(s) Financial Planning Recommendation(s)
A CFP® professional must present to the Client the The financial planning practitioner shall communicate
selected recommendations and the information that the recommendation(s) in a manner and to an extent
was required to be considered when developing the reasonably necessary to assist the client in making an
recommendation(s). informed decision.
When presenting a recommendation, the practitioner
shall make a reasonable effort to assist the client
in understanding the client’s current situation, the
recommendation itself, and its impact on the ability
to meet the client’s goals, needs and priorities. In
doing so, the practitioner shall avoid presenting the
practitioner’s opinion as fact.
The practitioner shall communicate the factors
critical to the client’s understanding of the
recommendations. These factors may include but are
not limited to material:
• Personal and economic assumptions;
• Interdependence of recommendations;
• Advantages and disadvantages;
• Risks; and/or
• Time sensitivity.
The practitioner should indicate that even though
the recommendations may meet the client’s goals,
needs and priorities, changes in personal and
economic conditions could alter the intended
outcome. Changes may include, but are not limited
to: legislative, family status, career, investment
performance and/or health.
If there are conflicts of interest that have not been
previously disclosed, such conflicts and how they may
impact the recommendations should be addressed at
this time.
Presenting recommendations provides the
practitioner an opportunity to further assess
whether the recommendations meet client
expectations, whether the client is willing to act on
the recommendations, and whether modifications are
necessary.
23
6. Implementing the Financial Planning Practice Standard 500-1: Agreeing on

Recommendation(s) Implementation Responsibilities
a. Addressing Implementation The financial planning practitioner and the client shall
Responsibilities. A CFP® professional mutually agree on the implementation responsibilities
must establish with the Client whether consistent with the scope of the engagement.
the CFP® professional has implementation
responsibilities. When the CFP® professional
has implementation responsibilities, the The client is responsible for accepting or rejecting
CFP® professional must communicate to recommendations and for retaining and/or delegating
the Client the recommendation(s) being implementation responsibilities. The financial
implemented and the responsibilities of the planning practitioner and the client shall mutually
CFP® professional, the Client, and any third- agree on the services, if any, to be provided by
party with respect to implementation. the practitioner. The scope of the engagement, as
originally defined, may need to be modified.
b. Identifying, Analyzing, and Selecting
Actions, Products, and Services. A CFP® The practitioner’s responsibilities may include, but are
professional who has implementation not limited to the following:
responsibilities must identify and analyze
• Identifying activities necessary for
actions, products, and services designed to
implementation;
implement the recommendations. The CFP®
professional must consider the basis for • Determining division of activities between the
each selection, which must include: practitioner and the client;
i. How the action, product, or service • Referring to other professionals;
is designed to implement the CFP®
• Coordinating with other professionals;
professional’s recommendation; and
• Sharing of information as authorized; and
ii. The advantages and disadvantages of
the action, product, or service relative to • Selecting and securing products and/or services.
reasonably available alternatives.
If there are conflicts of interest, sources of
c. Recommending Actions, Products, and compensation or material relationships with other
Services for Implementation. A CFP® professionals or advisers that have not been
professional who has implementation previously disclosed, such conflicts, sources or
responsibilities must recommend one or relationships shall be disclosed at this time.
more actions, products, and services to the
When referring the client to other professionals or
Client. The CFP® professional must discuss
advisers, the financial planning practitioner shall
with the Client the basis for selecting an
indicate the basis on which the practitioner believes
action, product, or service, the timing
the other professional or adviser may be qualified.
and priority of implementing the action,
product, or service, and disclose and If the practitioner is engaged by the client to provide
manage any Material Conflicts of Interest only implementation activities, the scope of the
concerning the action, product, or service. engagement shall be mutually defined, orally or in
writing, in accordance with Practice Standard 100-1.
d. Selecting and Implementing Actions,
This scope may include such matters as the extent
Products, or Services. A CFP® professional
to which the practitioner will rely on information,
who has implementation responsibilities
analysis or recommendations provided by others.
must help the Client select and implement
the actions, products, or services. The CFP® Practice Standard 500-2: Selecting Products and
professional must discuss with the Client Services for Implementation
any Client selection that deviates from the
The financial planning practitioner shall select
actions, products, and services the CFP®
appropriate products and services that are consistent
professional recommended.
with the client’s goals, needs and priorities.
24

The financial planning practitioner shall investigate
products or services that reasonably address the
client’s needs. The products or services selected to
implement the recommendation(s) must be suitable
to the client’s financial situation and consistent with
the client’s goals, needs and priorities.
The financial planning practitioner uses professional
judgment in selecting the products and services that
are in the client’s interest. Professional judgment
incorporates both qualitative and quantitative
information.
Products and services selected by the practitioner
may differ from those of other practitioners or
advisers.
More than one product or service may exist that
can reasonably meet the client’s goals, needs and
priorities.
The practitioner shall make all disclosures required by
applicable regulations.
25
7. Monitoring Progress and Updating Practice Standard 600-1: Defining

Monitoring Responsibilities
a. Monitoring and Updating Responsibilities.
A CFP® professional must establish The financial planning practitioner and client shall
with the Client whether the CFP® mutually define monitoring responsibilities.
professional has monitoring and updating Explanation of this Practice Standard
responsibilities. When the CFP® professional
has responsibilities for monitoring and The purpose of this Practice Standard is to clarify
updating, the CFP® professional must the role, if any, of the practitioner in the monitoring
communicate to the Client: process. By clarifying this responsibility, the client’s
expectations are more likely to be in alignment with
i. Which actions, products, and services the level of monitoring services which the practitioner
are and are not subject to the CFP® intends to provide.
professional’s monitoring responsibility;
If engaged for monitoring services, the practitioner
ii. How and when the CFP® professional shall make a reasonable effort to define and
will monitor the actions, products, and communicate to the client those monitoring activities
services; the practitioner is able and willing to provide. By
iii. The Client’s responsibility to inform explaining what is to be monitored, the frequency
the CFP® professional of any Material of monitoring and the communication method, the
changes to the Client’s qualitative and client is more likely to understand the monitoring
quantitative information; service to be provided by the practitioner.
iv. The CFP® professional’s responsibility The monitoring process may reveal the need to
to update the financial planning reinitiate steps of the financial planning process. The
recommendations; and current scope of the engagement may need to be
modified.
v. How and when the CFP® professional
will update the financial planning
recommendations.
b. Monitoring the Client’s Progress. A
CFP® professional who has monitoring
responsibilities must analyze, at appropriate
intervals, the progress toward achieving the
Client’s goals. The CFP® professional must
review with the Client the results of the
CFP® professional’s analysis.
c. Obtaining Current Qualitative and
Quantitative Information. A CFP®
professional who has monitoring
responsibility must collaborate with the
Client in an attempt to obtain current
qualitative and quantitative information
concerning the Client’s personal and
financial circumstances.
d. Updating Goals, Recommendations, or
Implementation Decisions. Where a CFP®
professional has updating responsibility,
and circumstances warrant changes to
the Client’s goals, recommendations, or
selections of actions, products or services,
the CFP® professional must update as
appropriate in accordance with these
Practice Standards.
26
D. DUTIES OWED TO FIRMS AND SUBORDINATES

1. Use Reasonable Care When Supervising Rule 4.6 A certificant shall provide reasonable and
prudent professional supervision or direction to any
A CFP® professional must exercise reasonable care
subordinate or third party to whom the certificant
when supervising persons acting under the CFP®
assigns responsibility for any client services.
professional’s direction, including employees and
other persons over whom the CFP® professional
has responsibility, with a view toward preventing
violations of applicable laws, rules, regulations, and
these Standards.
2. Comply with Lawful Objectives Rule 5.1 A certificant who is an employee/agent shall
of CFP® Professional’s Firm perform professional services with dedication to the
lawful objectives of the employer/principal and in
A CFP® professional:
accordance with CFP Board’s Code of Ethics.
a. Will be subject to discipline by CFP Board
for violating policies and procedures of the
CFP® Professional’s Firm that do not conflict
with these Standards.
b. Will not be subject to discipline by CFP
Board for violating policies and procedures
of the CFP® Professional’s Firm that conflict
with these Standards.
3. Provide Notice of Public Discipline Rule 5.2 A certificant who is an employee/agent
shall advise his or her current employer/principal of
A CFP® professional must promptly advise the CFP®
any certification suspension or revocation he or she
Professional’s Firm, in writing, of any public discipline
receives from CFP Board.
imposed by CFP Board.
27
E. DUTIES OWED TO CFP BOARD

1. Definitions. The following definitions apply: No equivalent in Current Standards.
a. Felony. A felony offense, or for jurisdictions
that do not differentiate between a felony
and a misdemeanor, an offense punishable
by a sentence of at least one-year
imprisonment or a fine of at least $1,000.
b. Relevant Misdemeanor. A criminal
offense, that is not a Felony, for conduct
involving fraud, theft, misrepresentation,
other dishonest conduct, crimes of moral
turpitude, violence, or a second (or more)
alcohol and/or drug-related offense.
c. Regulatory Investigation. An investigation
initiated by a federal, state, local, or foreign
governmental agency, self-regulatory
organization, or other regulatory authority.
A Regulatory Investigation does not include
preliminary or routine regulatory inquiries
or requests for information, deficiency
letters, “blue sheet” requests or other
trading questionnaires, or examinations.
d. Regulatory Action. An action initiated by a
federal, state, local, or foreign governmental
agency, self-regulatory organization, or
other regulatory authority.
e. Civil Action. A lawsuit or arbitration.
f. Finding. A finding includes an adverse
final action and a consent decree in which
the finding is neither admitted nor denied,
but does not include a deficiency letter,
examination report, memorandum of
understanding, or similar informal resolution
of a matter.
g. Minor Rule Violation. A violation of a self-
regulatory organization rule designated
as a minor rule violation under a plan
approved by the U.S. Securities and
Exchange Commission. A rule violation may
be designated as “minor” under a plan if
the sanction imposed consists of a fine of
$2,500 or less, and if the sanctioned person
does not contest the fine.
28
2. Refrain from Adverse Conduct. A CFP® profes- Rule 6.5 A certificant shall not engage in conduct
sional may not engage in conduct that reflects which reflects adversely on his or her integrity or
adversely on his or her integrity or fitness as a fitness as a certificant, upon the CFP® marks, or upon
CFP® professional, upon the CFP® marks, or upon the profession.
the profession. Such conduct includes, but is not
limited to, conduct that results in:
a. A Felony or Relevant Misdemeanor
conviction, or admission into a program
that defers or withholds the entry of a
judgment of conviction for a Felony or
Relevant Misdemeanor;
b. A Finding in a Regulatory Action or a Civil
Action that the CFP® professional engaged
in fraud, theft, misrepresentation, or other
dishonest conduct;
c. A personal bankruptcy or business
bankruptcy filing or adjudication where the
CFP® professional was a Control Person of
the business, unless the CFP® professional
can rebut the presumption that the
bankruptcy demonstrates an inability to
manage responsibly the CFP® professional’s
or the business’s financial affairs;
d. A federal tax lien on property owned by
the CFP® professional, unless the CFP®
professional can rebut the presumption
that the federal tax lien demonstrates an
inability to manage responsibly the CFP®
professional’s financial affairs; or
e. A non-federal tax lien, judgment lien, or
civil judgment that has not been satisfied
within a reasonable amount of time
unless the CFP® professional can rebut
the presumption that the non-federal
tax lien, judgment lien, or civil judgment
demonstrates an inability to manage
responsibly the CFP® professional’s financial
affairs.
3. Reporting. A CFP® professional must provide writ- Rule 6.4 A certificant shall notify CFP Board
ten notice to CFP Board within 30 calendar days in writing of any conviction of a crime, except
after the CFP® professional, or an entity over which misdemeanor traffic offenses or traffic ordinance
the CFP® professional was a Control Person, has: violations unless such offense involves the use of
alcohol or drugs, or of any professional suspension
a. Been charged with, convicted of, or
or bar within ten (10) calendar days after the date
admitted into a program that defers
on which the certificant is notified of the conviction,
or withholds the entry of a judgment
suspension or bar.
or conviction for, a Felony or Relevant
Misdemeanor;
29
b. Been named as a subject of, or whose

conduct is mentioned adversely in, a
Regulatory Investigation or Regulatory
Action alleging failure to comply with
Professional Services;
c. Had conduct mentioned adversely in a
Finding in a Regulatory Action involving
failure to comply with the laws, rules, or
regulations governing Professional Services
(except a Regulatory Action involving a
Minor Rule Violation in a Regulatory Action
brought by a self-regulatory organization);
d. Had conduct mentioned adversely in a
Civil Action alleging failure to comply with
Professional Services;
e. Become aware of an adverse arbitration
award or civil judgment, or a settlement
agreement, in a Civil Action alleging
failure to comply with the laws, rules,
or regulations governing Professional
Services, where the conduct of the CFP®
professional, or an entity over which the
CFP® professional was a Control Person,
was mentioned adversely, other than a
settlement for an amount less than $15,000;
f. Had conduct mentioned adversely in a Civil
Action alleging fraud, theft, misrepresenta-
tion, or other dishonest conduct;
g. Been the subject of a Finding of fraud, theft,
misrepresentation, or other dishonest conduct
in a Regulatory Action or Civil Action;
h. Become aware of an adverse arbitration
award or civil judgment, or a settlement
agreement in a Civil Action alleging fraud,
theft, misrepresentation, or other dishonest
conduct, where the conduct of the CFP®
professional, or an entity over which the
CFP® professional was a Control Person,
was mentioned adversely;
i. Had a professional license, certification,
or membership suspended, revoked, or
materially restricted because of a violation
of rules or standards of conduct;
j. Been terminated for cause from
employment or permitted to resign in
lieu of termination when the cause of
the termination or resignation involved
allegations of dishonesty, unethical conduct,
or compliance failures;
30
k. Been named as the subject of, or been

identified as the broker/adviser of record in,
any written, customer-initiated complaint
that alleged the CFP® professional was
involved in:
i. Forgery, theft, misappropriation, or
conversion of Financial Assets;
ii. Sales practice violations and contained
a claim for compensation of $5,000 or
more; or
iii. Sales practice violations and settled for
an amount of $15,000 or more.
l. Filed for or been the subject of a personal
bankruptcy or business bankruptcy where
the CFP® professional was a Control Person;
m. Received notice of a federal tax lien on
property owned by the CFP® professional; or
n. Failed to satisfy a non-federal tax lien,
judgment lien, or civil judgment within one
year of its date of entry, unless payment
arrangements have been agreed upon by all
parties.
4. Provide Narrative Statement. The written notice No equivalent in Current Standards.

must include a narrative statement that accurately
and completely describes the Material facts and
the outcome or status of the reportable matter.
5. Cooperation. A CFP® professional may not make Rule 6.1 A certificant shall abide by the terms of
false or misleading representations to CFP Board all agreements with CFP Board, including, but
or obstruct CFP Board in the performance of its not limited to, using the CFP® marks properly and
duties. A CFP® professional must satisfy the co- cooperating fully with CFP Board’s trademark and
operation requirements set forth in CFP Board’s professional review operations and requirements.
Procedural Rules, including by cooperating fully
with CFP Board’s requests, investigations, disci-
plinary proceedings, and disciplinary decisions.
6. Compliance with Terms and Conditions of
Certification and License. A CFP® professional
must comply with the Terms and Conditions of
Certification and License.
F. PROHIBITION ON CIRCUMVENTION No equivalent in Current Standards.

A CFP® professional may not do indirectly, or through
or by another person or entity, any act or thing
that the Code and Standards prohibit the CFP®
professional from doing directly.
31
GLOSSARY Terminology: “Certificant’s Employer” denotes

any person or entity that employs a certificant
CFP® Professional’s Firm(s): Any entity on behalf
or registrant to provide services to a third party
of which a CFP® professional provides Professional
on behalf of the employer, including certificants
Services to a Client, and that has the authority
and registrants who are retained as independent
to exercise control over the CFP® professional’s
contractors or agents.
activities, including the CFP® professional’s employer,
broker-dealer, registered investment adviser,
insurance company, and insurance agency.
Client: Any person, including a natural person, Terminology: “Client” denotes a person, persons,
business organization, or legal entity, to whom the or entity who engages a certificant and for whom
CFP® professional provides or agrees to provide professional services are rendered. Where the
Professional Services pursuant to an Engagement. services of the certificant are provided to an entity
(corporation, trust, partnership, estate, etc.), the client
is the entity acting through its legally authorized
representative
Conflict of Interest: (a) When a CFP® professional’s Terminology: A “conflict of interest” exists when
interests (including the interests of the CFP® a certificant’s financial, business, property and/or
Professional’s Firm) are adverse to the CFP® personal interests, relationships or circumstances
professional’s duties to a Client, or (b) When a CFP® reasonably may impair his/her ability to offer
professional has duties to one Client that are adverse objective advice, recommendations or services.
to another Client.
Control: The power, directly or indirectly, to direct the No equivalent in Current Standards.
management or policies of the entity at the relevant
time, through ownership, by contract, or otherwise.
Control Person: A person who has Control. No equivalent in Current Standards.
Engagement: An oral or written agreement, Terminology: A “financial planning engagement”

arrangement, or understanding. exists when a certificant performs any type of
mutually
Family: Grandparent, parent, stepparent, father- No equivalent in Current Standards.

in-law/mother-in-law, uncle/aunt, spouse, former
spouse, spousal equivalent, domestic partner,
brother/sister, stepsibling, brother-in-law/sister-in-law,
cousin, son/daughter, stepchild, son-in-law/daughter-
in law, nephew/niece, grandchild, and any other
person the CFP® professional, directly or indirectly,
supports financially to a material extent.
32
Financial Advice: No equivalent in Current Standards.

A. A communication that, based on its content,
context, and presentation, would reasonably be
viewed as a recommendation that the Client take
or refrain from taking a particular course of action
with respect to:
1. The development or implementation of a
financial plan;
2. The value of or the advisability of investing in,
purchasing, holding, gifting, or selling Financial
Assets;
3. Investment policies or strategies, portfolio
composition, the management of Financial
Assets, or other financial matters;
4. The selection and retention of other persons to
provide financial or Professional Services to the
Client; or
B. The exercise of discretionary authority over the
Financial Assets of a Client.
The determination of whether Financial Advice
has been provided is an objective rather than
subjective inquiry. The more individually tailored
the communication is to the Client, the more likely
the communication will be viewed as Financial
Advice. The provision of services or the furnishing
or making available of marketing materials, general
financial education materials, or general financial
communications that a reasonable CFP® professional
would not view as Financial Advice, does not
constitute Financial Advice.
Financial Assets: Securities, insurance products, real No equivalent in Current Standards.

estate, bank instruments, commodities contracts,
derivative contracts, collectibles, or other financial
products.
33
Financial Planning: A collaborative process that helps Terminology: “Personal financial planning” or
maximize a Client’s potential for meeting life goals “financial planning” denotes the process of
through Financial Advice that integrates relevant determining whether and how an individual can
elements of the Client’s personal and financial meet life goals through the proper management of
circumstances. financial resources. Financial planning integrates the
financial planning process with the financial planning
subject areas.
In determining whether the certificant is providing
financial planning or material elements of financial
planning, factors that may be considered include, but
are not limited to:
• The client’s understanding and intent in
engaging the certificant.
• The degree to which multiple financial planning
subject areas are involved.
• The comprehensiveness of data gathering.
• The breadth and depth of recommendations.
Financial planning may occur even if the material
elements are not provided to a client simultaneously,
are delivered over a period of time, or are delivered as
distinct subject areas. It is not necessary to provide a
written financial plan to engage in financial planning.
Material: Information is material when a reasonable No equivalent in Current Standards.

Client or prospective Client would consider the
information important in making a decision.
Professional Services: Financial Advice and related No equivalent in Current Standards.

activities and services that are offered or provided,
including, but not limited to, Financial Planning, legal,
accounting, or business planning services.
34
Related Party: A person or business entity No equivalent in Current Standards.

(including a trust) whose receipt of Sales-Related
Compensation a reasonable CFP® professional would
view as benefiting the CFP® professional or the CFP®
Professional’s Firm, including, for example, as a result
of the CFP® professional’s ownership stake in the
business entity. There is a rebuttable presumption
that a Related Party includes:
a. Family Members. A member of the CFP®
professional’s Family and any business
entity that the Family or members of the
Family Control; and
b. Business Entities. A business entity that the
CFP® professional or the CFP® Professional’s
Firm Controls, or that is Controlled by or
is under common Control with, the CFP®
Scope of Engagement: The Professional Services to No equivalent in Current Standards.

be provided pursuant to an Engagement.
35
No equivalent in Proposed Code and Standards. Terminology: “CFP Board” denotes Certified
Financial Planner Board of Standards, Inc.
Terminology: “Candidate for CFP® certification”
denotes a person who has applied to CFP Board to
take the CFP® Certification Examination, but who
has not yet met all of CFP Board’s certification
requirements.
Terminology: “Certificant” denotes individuals who
are currently certified by CFP Board.
Terminology: A “financial planning practitioner” is a
person who provides financial planning services to
clients.
Terminology: “Professional Eligible for
Reinstatement” (PER) denotes an individual who
is not currently certified but has been certified by
CFP Board in the past and has an entitlement, direct
or indirect, to use the CFP® marks. This includes
individuals who have relinquished their certification
and who are eligible for reinstatement without being
required to pass the current CFP® Certification
Examination. The Standards of Professional Conduct
apply to PERs when the conduct at issue occurred
at a time when the PER was certified; CFP Board has
jurisdiction to investigate such conduct.
Rule 3.4 A certificant shall clearly identify the
assets, if any, over which the certificant will take
custody, exercise investment discretion, or exercise
supervision.
Rule 3.5 A certificant shall identify and keep
complete records of all funds or other property of
a client in the custody, or under the discretionary
authority, of the certificant.
Rule 3.10 A certificant shall return a client’s property
to the client upon request as soon as practicable
or consistent with a time frame specified in an
agreement with the client.
Rule 6.3 A certificant shall notify CFP Board of
changes to contact information, including, but not
limited to, e-mail address, telephone number(s) and
physical address, within forty five (45) days.
36
C E R T I F I E D F I N A N C I A L P L A N N E R B OA R D O F S TA N DA R D S , I N C .
1425 K St NW #800 Washington DC 20005

p 800-487-1497 | f 202-379-2299
mail@CFPBoard.org | CFP.net
©
2018 Certified Financial Planner Board of Standards, Inc. All rights reserved.

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PREAMBLE CODE OF ETHICS AND PROFESSIONAL

A CFP® professional must: Principle 6 – Professionalism: Act in a manner that

2. INTEGRITY CODE OF ETHICS AND PROFESSIONAL

3. COMPETENCE CODE OF ETHICS AND PROFESSIONAL

4. DILIGENCE CODE OF ETHICS AND PROFESSIONAL

5. DISCLOSE AND MANAGE CODE OF ETHICS AND PROFESSIONAL

b. Manage Conflicts. A CFP® professional

6. SOUND AND OBJECTIVE CODE OF ETHICS AND PROFESSIONAL

7. PROFESSIONALISM CODE OF ETHICS AND PROFESSIONAL

9. CONFIDENTIALITY AND PRIVACY CODE OF ETHICS AND PROFESSIONAL

ii. For legal and enforcement purposes:

b. A CFP® professional may not use any non-

regulatory organization, such as the

12. DUTIES WHEN REPRESENTING

b. Related Parties receive no Sales-

ii. Business Entities. A business entity

13. DUTIES WHEN RECOMMENDING, ENGAGING, No equivalent in Current Standards.

will compensate or provide some other

14. DUTIES WHEN SELECTING, USING, No equivalent in Current Standards.

Rule 3.6 A certificant shall not borrow money

Rule 3.7 A certificant shall not lend money to a client.

B. FINANCIAL PLANNING AND APPLICATION Terminology: “Personal financial planning” or

3. Application of Practice Standards. The Practice Description of Practice Standards

5. CFP Board Evaluation. In a disciplinary proceeding No equivalent in Current Standards.

6. No Client Agreement to Engage for Financial No equivalent in Current Standards.

C. PRACTICE STANDARDS FOR THE GATHERING CLIENT DATA

2. Identifying and Selecting Goals Practice Standard 200-1: Determining a Client’s

alternatives or no alternative to the client’s current

4. Developing the Financial Planning Practice Standard 400-2: Developing the

5. Presenting the Financial Planning Practice Standard 400-3: Presenting the

6. Implementing the Financial Planning Practice Standard 500-1: Agreeing on

Explanation of this Practice Standard

7. Monitoring Progress and Updating Practice Standard 600-1: Defining

D. DUTIES OWED TO FIRMS AND SUBORDINATES

E. DUTIES OWED TO CFP BOARD

b. Been named as a subject of, or whose

k. Been named as the subject of, or been

4. Provide Narrative Statement. The written notice No equivalent in Current Standards.

F. PROHIBITION ON CIRCUMVENTION No equivalent in Current Standards.

GLOSSARY Terminology: “Certificant’s Employer” denotes

Control Person: A person who has Control. No equivalent in Current Standards.

Engagement: An oral or written agreement, Terminology: A “financial planning engagement”

Family: Grandparent, parent, stepparent, father- No equivalent in Current Standards.

Financial Advice: No equivalent in Current Standards.

Financial Assets: Securities, insurance products, real No equivalent in Current Standards.

Material: Information is material when a reasonable No equivalent in Current Standards.

Professional Services: Financial Advice and related No equivalent in Current Standards.

Related Party: A person or business entity No equivalent in Current Standards.

Scope of Engagement: The Professional Services to No equivalent in Current Standards.

1425 K St NW #800 Washington DC 20005

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