The European financial services and investment group Skandia has released a new guide to help advisors make due diligence checks on platform providers.

The guide is directly based on the US Federal Security Agency’s recommendations for platform due diligence, which encourages advisors to consider the suitability of a platform service, and not just the suitability of an investment, when counselling clients. The FSA also recommends that advisors review their platform provider choices after new developments in the market, and change platform providers if necessary.

Skandia’s guide also follows the FSA’s guide for platform due diligence in highlighting nine key areas of consideration when selecting a platform: its reputation and financial standing; the terms and conditions of using the platform; the actual charges and charging structure; the range of funds and tax wrappers available; the range of asset classes offered; the platform’s functionality and accessibility; any additional tools offered by the platform; and the support services the platform offers. The guide provides a range of customisable questions to consider under each of the FSA’s recommended categories.

“The platform market is growing rapidly and there is huge competition between the different services. Within this context it is becomingly increasingly important for advisors to ensure they have carried out thorough due diligence before using a platform and be able to demonstrate that they have done so,” said Skandia's chief development officer Peter Mann.

The platform due diligence guide is available from any of Skandia’s network of business consultants free of charge.