NZ financial advisers are now required to issue detailed disclosure statements for their clients following last week's changes to securities legislation.

Amendments to the Securities Markets Act 1988 came into effect on Friday and could mean heavy penalties if advisers do not comply.

The new Securities Legislation Bill requires advisers to disclose their qualifications, whether they have ties with companies in which they recommend investment, any fees and commissions involved, and whether they have professional indemnity insurance.

The tougher rules are expected to lead to an exodus from the NZ industry, but if financial adviser Liz Koh is typical of her counterparts, that won't be a big deal.

Ms Koh, who is author of personal finance advice book being published this week, told NZ media outlet Scoop a clean-up of the industry is long overdue.

"These regulations, together with further legislation now before Parliament, will expose the financial advisers who have poor knowledge and even poorer ethics," she said.

Securities Commission Director Primary Markets Kathryn Rogers says investors should be given the disclosure statement without having to ask for it.

"Advisers have had since the law was passed in October 2006 to prepare their disclosure statements," Ms Rogers said. "We expect that they will have them ready for their clients."