Compliance staff should look to improve standards rather than just uncover advisers’ breaches, according to Synchron director Don Trapnell.

“Some auditors are identifying practices that are doing certain things wrong, placing a cross next to their name, then moving on to do the same thing with the next practice,” he said.

“It doesn’t provide much incentive for advisers to change their ways.”

Mr Trapnell says compliance audits are a chance for dealer groups to work more closely with their advisers.

“It gives a great opportunity to provide mentoring and support for advisers who may need assistance in areas of compliance.

“It also allows us to identify and acknowledge when they are doing a great job.”

Synchron uses experienced financial services professionals to audit its advisers, arguing they understand the role better.

“We hire people who have put their knees under the tables in people’s kitchens and given financial advice. They understand that advisers need feedback, not just a rap over the knuckles when they do something wrong.”