Elizabeth, 86, owns herhome, valued at $640,000. She has $60,000in a bank account and receives a full pension. Elizabeth also has a small $15,000 total portfolio of shares in two

blue-chip companies. She received both parcels of shares when the companiesdemutualised in the 1990s and has kept them because she likesthe companies, and they pay high dividends.

Due to failinghealth, she is preparing to move into an aged-care facility. She wants to keep her home as an inheritance for her five children, as specified in her current Will. Elizabeth has appointed her eldest daughter, Kym, as both the executor of the estateand enduring power of attorney (EPOA). This covers legal and financialdecisions only and was drafted so that it had legal effect immediately. Both the Willand EPOA have been in place for three years, and Elizabeth had legal capacity to makethe documents at that time. All relevant parties residein the Australian state in which the documents were enacted.

Kym knows Marcus,a financial adviserwith Expert Financial Planning, through the local golf clubof which they are both members.Kym has arranged an appointment for her mother to meet with Marcus to discuss the financial planning implications of moving into an aged-care facility.

Kym explains to Marcus that she will be happyto sign off on any advice even if Elizabeth is unable to understand the recommendations.

 

Required:

Discuss the Standards that Marcus must observe in this situation. Explain the difficulties that he may encounter in this situation.

Answer rating: 100% (QA)

As a financial adviser Marcus must adhere to the professional and ethical standards set out by the F... View the full answer