The world has witnessed a major shift in the way money is managed and is now being automated in an unprecedented way.
At the same time, the financial industry is also facing the challenge of creating a more efficient financial system, according to a new report.
The report from the Financial Accounting Standards Board (FASB) and its Advisory Committee on Financial Reporting and Auditing (ACFRA) argues that automation in the financial sector has been a boon to financial advisers, who are increasingly making use of the automated tools and processes to make better business decisions and make decisions on the basis of a more holistic understanding of financial risks.
According to the report, the most recent financial year has seen the creation of over 1.8 million new accounts, as well as the expansion of a network of over 3.5 million financial advisors.
The financial industry has seen a significant increase in the number of advisers who have become self-employed, according the report.
This trend has been driven by the introduction of automated tools for financial advice in the U.S. and in Europe, and by the growing number of automated advisors that are now in place across the globe.
For example, in the past decade, the number and size of self-funded advisors in the United States has grown from about 3,600 in 2002 to more than 10,000 in 2015, according to a report from the US Federal Reserve Bank.
In Canada, advisors are increasingly utilizing automated tools, too.
For the past five years, the Financial Services Commission of Canada has launched a pilot program called the Automated Financial Advice Automation Program to test new automated systems for financial advisers.
The pilot program will run for five years and will include a panel of regulators and advisors to review all new and existing programs.
This will include the testing of new systems, the selection of the best systems, and the evaluation of the systems and programs’ efficiency, according Topper Liss-Riordan, the chair of the Financial Accountability Board (FAB), and the report’s author.
In Canada, financial advisors are also increasingly using automated systems to make recommendations on the financial risk posed by clients, a trend that has been seen across all major financial markets.
For example, the Financial System Review and Advisory Panel (FSRA) conducted a study in 2013 that found that, in Canada, over 80% of financial advisors were using automated tools to make investment and asset selection decisions, and that over 60% of those advisors had used automated tools in their investment decisions.
Similarly, in Australia, a pilot project was initiated in 2014 by the Australian Financial Services Association (AFSA) to evaluate the impact of automated financial advice systems.
In addition, a study conducted in Germany showed that, between 2010 and 2014, the average number of financial advisers who made investment and other asset-specific decisions was significantly increased by the implementation of automated systems, while the average amount of investment and income made by advisors in those same periods declined.
The Financial Accounting Standard Board (ASB), the non-profit accreditation body for the financial services industry, also released a report in 2015 that showed that the number-one challenge facing financial advisors was the inability to accurately predict how their clients will react to changes in the market.
As a result, financial advisers had to make decisions based on a combination of current market conditions, future market conditions and market trends, according TOpper Lis-Ribet, a member of the ASB Advisory Committee.
“The need to anticipate the reactions of our clients to financial market events is now the most important aspect of the financial adviser’s role,” she said.
A recent report from a financial services advisory firm, Fidelity Financial Services, showed that financial advisers were increasingly becoming self-sufficient.
As of 2015, FFI reported that more than one-quarter of its advisors had no clients, which represented a 16% increase from the previous year.
As the number is projected to reach almost 50 million advisors in 2020, firms have to make the financial advice process easier, faster, and more transparent, according FFI.
And that is why FFI, the largest financial advisor in the world, is calling for more regulatory and technological improvements in the area of financial advisory automation.
The association has also called on regulators to ensure that financial advisors are required to report all financial information and actions taken on their behalf to the Financial Accounts Reporting System (FARS).
“FASBs and other regulators need to take the lead and encourage the financial advisors and financial advisors companies to work collaboratively to develop the most appropriate technology for the efficient and timely management of financial assets,” FFI said in a press release.
“FASFs and other regulatory agencies need to focus on the fact that automation is a critical part of the transition to a financial system that