Scope of work in financial planning: how to write a clear one

A fee disagreement with a client is often about surprise rather than the amount: a client who did not understand what they were paying for, what the ongoing service included, or that they could stop it. A clear scope of work prevents most of that before it starts.

This guide explains how to write a scope of work in financial planning that a client understands, covers the ongoing service and charging disclosures in COBS 6.1A, and ends with a checklist to use before you send one.

What a scope of work in financial planning does

A scope of work sets out, in writing, what you will do for the client, what you will not do, what it will cost and how the relationship continues afterwards. It usually follows the discovery meeting and comes before the advice itself. Done well, it:

• shows the client you understood what they asked for;
• sets clear boundaries, so expectations match the work;
• discloses charges in good time before the recommendation, as COBS 6.1A.17R requires;
• describes any ongoing service and how to cancel it;
• gives the file a dated record of what was agreed.

If you have not yet written up the discovery meeting, start there. Our guide to the discovery meeting in financial planning covers what to capture.

The rules behind charges and ongoing service

Several rules in COBS 6.1A shape the charging part of every scope of work (COBS 6.1A):

• COBS 6.1A.4R: a firm must "only be remunerated for the personal recommendation… by adviser charges".
• COBS 6.1A.22R: adviser charges paid over time for an ongoing service must be for "an ongoing service for the provision of personal recommendations or related services", which must be disclosed, with "a right to cancel the ongoing service… without penalty". (The rule also allows ongoing charges in some cases where the client makes regular payments into a product.)
• COBS 6.1A.17R and COBS 6.1A.24R: the charging structure must be disclosed in writing "in good time before making the personal recommendation", and the total adviser charge must be agreed with the client and disclosed in cash terms.

The Consumer Duty adds the price and value outcome (PS22/9), and the FCA lists "Expectations for wealth and advice firms when assessing fair value" among its focus areas for advice firms (FCA focus areas). A scope of work that sets out clearly what the client receives for the fee is part of how you show that value.

Ongoing service is also where the FCA has looked hard. It found that "About 80% of revenue from adviser charges relates to charges for ongoing services from around 4 million clients" (FCA ongoing advice review). If the client is paying for a service, the scope should say exactly what it is.

What to include: section by section

1. Your situation and what you asked for

Two or three short paragraphs summarising the client's position and the help they asked for, in their own words. This is the anchor for everything else.

2. The work we will do

List the specific pieces of work: for example, a review of existing pensions, a recommendation on retirement income, a cash flow plan. Be specific enough that the client could tell whether each item was delivered.

3. What is not included

Say what you will not cover, such as tax returns, legal advice or mortgage advice, and where the client might get help. This prevents later disputes.

4. What we need from you

Documents, letters of authority, decisions. Name them, with dates if possible.

5. Initial charges

State the charge in pounds where you can, how it is calculated, when it is payable and how it is paid. Show a worked example if it is a percentage.

6. The ongoing service

If you offer one, describe it plainly:

• what the client receives, such as a review meeting, a written review, portfolio monitoring, access to the adviser;
• how often each happens;
• the ongoing charge, in pounds and as a percentage, with a worked example;
• how the charge is taken;
• how to cancel, and that it can be cancelled without penalty.

7. Next steps and timescales

What happens when the client agrees, and roughly when they can expect the recommendation.

Writing it so clients understand

• Money, not just percentages. "1% a year, which on £250,000 is £2,500" (an illustration) is clearer than "1%". COBS 6.1A.24R requires the total adviser charge to be disclosed in cash terms.
• Plain verbs. "We will review your pension each year" rather than "an annual review will be undertaken".
• One idea per paragraph. Short paragraphs with clear headings.
• Put cancellation where it can be seen. Not in a footnote.
• Match the service to the client. If the client has simple needs, say what a lighter service includes rather than describing a service they will not use.

The figures in the worked example are illustrative only: use your own charging structure and figures.

Scope of work checklist and common mistakes

Common mistakes

• Describing the ongoing service in general terms the firm cannot evidence later.
• Promising a service frequency the firm does not actually deliver.
• Showing charges only as percentages.
• Burying the right to cancel.
• Reusing a template so heavily that nothing in it is about this client.

The second point matters most. A file reviewer will compare what the scope promised with what the file shows was delivered. Our compliance file review checklist covers how that is tested.

Keep an eye on CP26/10, which proposes "Replacing the annual suitability review with periodic reviews based on clients' needs" (CP26/10). It is a consultation proposal, not a final rule, but if adopted it may change how firms describe ongoing service frequency.

Drafting the scope from the meeting

By our estimate, drafting a client document like a scope of work by hand takes about two hours. That is time advisers rarely have between meetings, which is why scopes are so often delayed or templated.

Carbon drafts a scope of work straight from the recorded discovery meeting in Fireflies, written in your firm's voice using your house style and word list, with your branding applied. It keeps every version in a document vault and can draft the follow-up email with the scope attached. By our estimate, a draft takes about fifteen minutes. You check the work, the charges and the service description against your own terms, edit inline, and export to Word or PDF. Responsibility for what is promised stays with the firm.

Frequently asked questions

What is a scope of work in financial planning?

A written statement of what the adviser will do, what is excluded, what it will cost, and any ongoing service, agreed with the client before the advice work begins.

Does a scope of work need to mention the right to cancel?

If you offer an ongoing service with an ongoing charge, COBS 6.1A.22R requires the client to have "a right to cancel the ongoing service… without penalty". Stating it clearly in the scope is the simplest way to show it was disclosed.

Should charges be shown in pounds or percentages?

Both, where you can. COBS 6.1A.24R requires the total adviser charge to be disclosed in cash terms, and a percentage with a worked example in pounds is far easier for a client to understand than a percentage alone.

See how Carbon drafts a scope of work from a recorded meeting, or book a twenty-minute demo on Microsoft Teams with Adam Booth, run live on a demo firm with nothing to prepare.