HOW WE WORK WITH CLIENTSOUR SERVICES AND FEES

WELCOMEAppointing a financial adviser is an impor-tant decision, and for many people is thefirst step towards securing their financialfuture.

WHAT WE DO?

As independent financial advisers, our job is to makeyour money work for you, whatever your situation oryour stage in life, so that you can live the way you wantto. As you would expect from a professional firm of independent financial advisers, we have the depth andbreadth of knowledge and expertise to provide practical,informed advice on all aspects of your financial affairs.

We understand that by appointing us as your independent financial advisers you are placing your trustin us. Our advisers are highly qualified and will always actin your best interests. Among other things, they are required to:

explain clearly the areas on which they advise and the•services they offer

act in your best interests at all times and with total•integrity

discuss and agree fees and payment options in advance,•before undertaking any work you ask them to do.

We offer different levels of services, all of which have theflexibility to be tailored to suit your particular requirements and the complexity of your financial circumstances. They are set out in this brochure and youradviser will help you decide which is best for you.

WHO ARE McHARDY FINANCIAL

Operating as McHardy & Burnett in Aberdeen city centre since 1987, and now known as McHardy Financialin 2014 we have been offering corporate and private clients a high level of personal service and financial expertise in helping them to plan a secure financial future. We aim to deliver a cohesive offering, providing our clients with Financial Services, General Insurance and Employee Benefits advice.

McHardy Financial offers independent wealth creationand wealth management services lifestyle planning to private individuals and comprehensive employee benefitsconsultancy services to employers of all types and sizes.

Our team consists of qualified financial planners andmortgage advisers backed up by a dedicated and professional team of support staff. To find out moreabout us and meet the team go to www.mchb.co.uk

WELCOME

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WELCOMEWELCOME

OUR ETHOSWe offer different levels of services, all of which have the flexibility to betailored to suit your particular requirements and the complexity of your financial circumstances. They are set out in this brochure and your adviserwill help you decide which is best for you.

CONTENTSThe advice process explained 3

Three simple steps: initial consultation, report and implementation 4

On-going advice service options: Transactional, Transactional Plus, Priority and Priority Plus 5

Our fees 6

Initial fees 7

Fees for on-going services 10

Fees for ad hoc services 11

Information about our services 12

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WELCOME

Taking financial advice can appear complicated.In reality, dealing with a professional, independ-ent adviser makes it a fairly straightforwardprocess, during which your adviser draws ontheir expertise and experience to recom-mend strategies that are suitable for you andyour circumstances, enabling you to make informed decisions.

The process outlined below is explained infurther detail in this brochure. However, it isuseful to understand the main stages involvedin providing financial advice and the decisionsyou will need to make.

OUR ADVICE PROCESS EXPLAINED

GATHER INFORMATION

At your initial consultation your adviser willask you about your current financial circum-stances and arrangements and help you deter-mine your financial objectives.

If we find you could benefit from financialadvice, you will need to decide if you wishto proceed and, if you do, choose the typeof report you require and agree the ap-propriate fees. An engagement letter willbe issued to you outlining your objectivesand give you an indication of fees

RESEARCH AND RECOMMEND

Your adviser will research the most suitable financial solu-tions for you from all those available on the market, basedon the information you provided at the initial consultationand as agreed with you. They will report on and recom-mend actions and products based on the objectives youagreed, and explain the associated implementation costs.

You will then need to decidewhether to go ahead with therecommendations.

ONGOING ADVICE

Your adviser will ask you whether you would like toreceive independent financial advice on an ongoingbasis and, if you do, will explain the different serviceswe offer.

You will need to decide which, if any,of our ongoing service propositionssuits you best and agree the appropri-ate fee structure for providing this.

WHAT YOUR ADVISER DOES WHAT YOU WILL NEED TO DECIDE

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WELCOMEWELCOMETHREE SIMPLE STEPSINITIAL CONSULTATIONYou will want to understand how McHardy Financial may be able to help you and whether you wantto appoint us as your financial advisers.

Your adviser will ask you about your circumstances, current financial position and your financial goals,so they can understand the areas in which you may be able to benefit from advice. They also assessyour Attitude to Risk using industry-leading fact-finding and risk analysis methods, which will help determine among other things which types of savings and investments may be suitable for you.

Your adviser will also explain the benefits of using our services and how we charge for them. Havinggathered this information from you and discussed your needs, your adviser will ask you whether youwant to proceed and, if you do, agree with you the type of report and recommendations you requireand explain the fees payable for our services, which are set out on pages six to eleven.

RECOMMENDATIONSYour adviser will analyse all the information you supplied at your initial consultation and, based onyour discussions about your current circumstances and financial objectives, will provide you with awritten report focusing on the relevant specific issues.

This report will be an overview of your financial situation, a focused recommendation or, where applicable, a comprehensive recommendation.

These may include a recommendation for the most suitable product, provider and, for investments,fund or portfolio, chosen from all those available, for all the specific issues on which you have asked usto advise. We will assess your financial circumstances and existing arrangements together with yourobjectives and Attitude to Risk when making a recommendation.

IMPLEMENTATIONOnce you have agreed the course of action to take we will implement our recommendation or financial plan, liaising with product providers on your behalf, dealing with all the paperwork and keeping you informed of progress until implementation is complete. You will need to provide us withaccurate personal details to facilitate this process.

This stage may involve putting in place new arrangements and transferring, terminating or selling existing plans, policies, investments and other arrangements. It may involve signing additional paperwork, for example, such as Trust arrangements to help with family or estate protection.

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WELCOMEONGOING SUPPORT

As your life changes, so do your financial goals. Gettingmarried, moving home, having a family and approaching retirement are just some of the thingsthat have an impact on your financial circumstancesand arrangements. Plus, with frequent changes to legislation and market conditions, a financial plan canbecome outdated surprisingly quickly.

That is why many people choose to appoint McHardyFinancial as their long-term financial advisers – theywant to know that an expert financial adviser is

keeping an eye on their financial arrangements and isavailable whenever required.

Once your initial recommendations have been implemented your adviser will ask you to choose thetype of service you would like us to provide in the future. This is likely to depend on the value of your investments, the number and type of holdings, andyour objectives, timeframes and personal preference.

We offer four service options:

REVIEW SERVICE

TRANSACTIONAL

Our Transactional service will suityou if you require a one-off trans-action and do not need on-going re-views or financial advice.

You will receive our regular clientnewsletter electronically. However,we will not send you valuations, in-formation about legislative or eco-nomic changes, or provide you withany further advice and you will notnormally have any further contactwith your adviser.We would, of course, be pleased toadvise you on future issues for ourusual fees should the need arise andyou decide to contact us, for in-stance if you would like to reviewyour portfolio or are approachingretirement

TRANSACTIONAL PLUS

Our Transactional Plus service pro-vides a reactive advice service withannual updates.In addition to the regular newsletteryou will receive an annual consoli-dated portfolio valuation and a“change of circumstances question-naire”, and have access to our cus-tomer care team.

Your adviser will contact you if thequestionnaire identifies a need foraction.

PRIORITY

Our Priority service will suit you ifyou require on-going guidance, per-haps about a specific issue, and wishto build an on-going relationshipwith a financial adviser.

This service includes:

Regular electronic client•newsletterAnnual Review of your portfo-•lio and updateConsolidated portfolio valua-•tion statementAsset allocation analysis in•comparison with agreed bench-markFund performance analysis•Rebalance of portfolio to•benchmarkImplementation of appropriate•changesUnlimited telephone access to•your adviserUnlimited email communication•with adviserUnlimited access to your cus-•tomer care teamAnnual Face to Face meeting•Liaison with other professional•advisersAssistance with financial paper-•work

PRIORITY PLUS

Our Priority Plus service will suityou if you require on-going guid-ance and the complexity and/orvalue of your portfolio is likely tonecessitate frequent reviews.

This service includes:

Regular hard copy of our•newsletterAnnual and Interim Reports to•review your portfolio and up-date of your situationOn-going in-depth analysis of•your portfolioUnlimited telephone and email•access to your adviserTwo face to face full review•meetings per year Supply of end of tax year infor-•mationLiaison with other professional•advisersUnlimited access to your cus-•tomer care teamFee-Free mortgage consulta-•tionDiscounts for advice on top-•ups to existinginvestments/pensions.Regular updates on the best•rates for cash holdings shouldyou use a recommended cashfacility

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FEESAs professional advisers we charge fees for our services. Once you have agreed with your adviser the workyou would like us to undertake and discussed the costs involved, he or she will prepare an ‘engagement letter’detailing the work to be undertaken on your behalf, and the cost of preparing and presenting a strategy report.

Our fees vary according to the complexity of your circumstances and objectives, the scope of the work re-quired, the type and number of products we are implementing (e.g. investments, insurance, mortgages, etc.). Inaddition, they take into account the regulatory responsibility we take for advice we give you.

Our fees are exempt from VAT if you intend to takeout a financial product through us as a result of theadvice we give you. If you require advice only (i.e. ifyou do not take out or intend to take out a financialproduct as a result of our advice) our fees are sub-ject to VAT at the prevailing rate.

THE APPLICABLE FEE CAN BE PAID DI-RECTLY FROM YOU, OR, WHERE FEASIBLE,FROM THE PRODUCT RECOMMENDED.

All fees are payable on completion of the agreedwork.

YOU MAY CANCEL OR CHANGE THE SERVICE YOU RECEIVE FROM McHARDY FINANCIAL AT ANY TIME BY SENDING AN EMAIL OR LETTER NOTIFYING US OF YOURDECISION. IF YOU DO CANCEL OR CHANGE THE SERVICE, WE WILL CHARGE A PRORATA FEE FOR WORK ALREADY UNDERTAKEN, OR IN THE CASE OF ANNUAL AGREEMENTS, THE PROPORTION OF THE YEAR THAT HAS ELAPSED.

For any normal queries and advice, we recommend that you contact your usual adviser in the first instance.However, you can also contact our office – details are on the back of this brochure.

We may recommend that you take certain actions, for example making a Will or setting upa trust for inheritance tax planning,

This will require the services of other professionals such as a solicitor or accountant.

Our Priority and Priority Plus services includesreferring you to such professionals if required.

The asset allocation (and therefore risk profile) of investments can changesurprisingly quickly, especially in volatile markets. We use market-leadingrisk profiling to discover your attitude to investment risk, and industry leading asset allocation modelling to ensure that your investments remainin line with your risk profile. This is part of the ongoing investment processwithin our Priority and Priority Plus services.

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INITIAL FEESSTAGE 1: INITIAL CONSULTATION: We will provide you with a one hour initial consultation where the cost will be borne by McHardy Financial.

STAGE 2: REPORT AND RECOMMENDATIONSCOST FOR SERVICE:

INVESTMENT AMOUNT

Strategy Report

(depending on investable sum)

Fee:

Up to £11,999

£450

£12,000 - £49,999

£650

£50,000 - £199,999

£1,000

£200,000 +

£1,250

Additional Services:

Fee:

IHT Planning

From £300

Trust Planning

From £150

Review of Existing Products:

Fee

Investment Products:

£100 per policy plus£10 per fund

Protection / Annuity

£50 each

Pension Review

Money Purchase (per policy) £100Final Salary (per scheme) £200

Fees stated do not include VAT. Please note that the above fees are exempt from VAT if you take out a financialproduct through us as a result of the advice we give you. If you require advice only (i.e. if you do not take outor intend to take out a financial product as a result of our advice) the above fees are subject to VAT at the prevailing rate.

EXAMPLE OF COSTS

Mr Client A is looking for advice with respect to three investment policies he currently holds. These hold atotal of eight funds. He is also looking for advice with respect to £50,000 he holds as cash on deposit. The investments he currently holds have a total value of £75,000.

The costs for a report and recommendation are as follows:

SERVICE COST

Strategy Report £1,000

3 x Investment Product Review £300

8 x Fund Review £80

TOTAL COST OF REPORT & ADVICE £1,3807

INITIAL FEES (CONTINUED)STAGE 3: IMPLEMENTATIONThe fees for implementing our recommendations are based on the amount to be invested, however, fees mayvary according to the complexity and scope of the work required and the type of products we are implementing (e.g. investments, pensions, insurance, mortgages).

Your adviser will agree all fees with you before implementing any of the recommendations. At our discretionwe may offset fees paid, or due, for stage two against the implementation fee. Our standard implementationfees are as follows:

Investments and pensionsLump sums (including transfers):

Up to £20,000:Next £80,000:Next £100,000:Next £300,000:Next £500,000:

Regular contributions (new plansand top-ups)

(Percentage of Total Investment/Contribution)

5.00%3.00%1.50%1.00%0.50%

These fees are subject to our minimum of £450 for im-plementation.

Example: For example, for a lump sum investment of£250,000 our implementation fee will be £5,400 (2.16%).This is made up of 5% for £20,000, 3% for £80,000, 1.5%for £100,000 and 1.0% for £50,000.

Up to 25% of the first year’s premiums subject to a mini-mum fee of £450.

Example: For example, for a regular investment of £250per month our implementation fee will be £750. This ismade up of 25% of the first year’s premiums.

Drawdown pension We charge the same as the thresholds noted above under‘Investments and Pensions, subject to a minimum of £800for implementation.

Insurance-based products From £450.We may receive commission from product providers forinsurance-based products. If this is the case we will dis-close this to you and, at our discretion, we may waive orreduce our usual insurance implementation fee.

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INITIAL FEES (CONTINUED)

STAGE 3: IMPLEMENTATION (CONTINUED)

Annuity purchases Our fee for setting up a standard Pension Annuity or similar contract is based on the purchase price as follows:

Up to £50,000 3.00%Next £50,000 2.00%Over £100,000 1.00%

subject to a minimum fee of £450. For Enhanced Annuities or similar contracts our minimum fee is £850.

Mortgages

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Our fee for researching the market and recommending asuitable mortgage is £450. In addition, on completion of the arrangements for the mortgage we willreceive a fee from the chosen lender, typically this will be0.35% of the mortgage amount for residential mortgagesand 0.5% of the mortgage amount for buy to let mortgages. This will be disclosed to you before you decide to proceed. For example, based on a mortgage of£150,000, the fee would be £525 for a residential mortgage and £750 for a buy to let mortgage.

FEES FOR ONGOING SERVICESServices

PriorityPlus Priority

TransactionalPlus Transactional

Newsletter

Strategy review meetings

Review of your attitude to risk

Free Mortgage Consultation

Annual Fee (taken as a percentage of fundsunder management)

Investment Level: Up to £100,000

Up to £250,000

Up to £500,000

Up to £1 million

£1 million Plus

Half-YearlyReviewMeeting

AnnualReviewMeeting

1.00%

0.80%

0.60%

0.50%

MinimumFee of £750per annum

1.00%

0.75%

0.65%

0.50%

0.40%MinimumFee of £500per annum

0.5% for allfunds undermanage-ment

MinimumFee of £150per annum

Portfolio summary and valuation

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Liaison with other professional advisers

FEES FOR ONGOING SERVICESFor example, our annual fee for our Priority service for a £50,000 investment wouldbe £500 based on a charge of 1.0% of the sum invested. An investment of £150,000,the annual charge would be £1,200 on an annual charge of 0.8% of the sum invested.Additional fees will apply to achieve the minimum fee applicable to each service.

Fees stated do not include VAT. Please note that the above fees may be subject to VAT at the prevailing rate.However, they will be exempt from VAT if you take out a new financial product through us or alter an existingone as a result of our recommendations.

We will review your funds under management at your Annual Review. Should thistake you into an alternative charging bracket we will amend your fees accordingly.We will also take into account any further investment made at any time.

FEES FOR AD HOC SERVICESWe would be pleased to provide any of the services listed below for an additional fee if they are not alreadyincluded in your service agreement.

Portfolio summary and valuation

We will send you a written summary and valuation of your investments and current holdings.

Strategy review meeting, including financial review

Your adviser will carry out a comprehensive review of your circumstances, arrangements and objectives. They will reassess yourstrategy and attitude to risk, to ensure that your arrangements continue to meet your objectives. They will recommend any changesthat may be required, recommending products chosen from all thoseavailable in the market. A review of your portfolio is included in thisservice*.

From £125

* If as a result of a review new plans are required, standard implementations fees will apply.

Portfolio review

Your adviser will review your current plans, policies, investmentsand other arrangements to ensure that they are still competitiveand appropriate, and are on track to meet your objectives. Thisincludes a review of the performance of your investments andrecommending any changes that may be required*.

From £250

From £600

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INFORMATION ABOUT OUR SERVICESARE WE FULLY INDEPENDENT?Yes, importantly, we provide a full Independent Advice service.

This means that we will advise and make a recommendation for you after we have assessed your needs, basedon a comprehensive and fair analysis of the market. We have access to the widest possible range of productsand companies.

ARE WE REGULATED?Yes. We are authorised and regulated by the Financial Conduct Authority (FCA) and you are protected bythe Financial Ombudsman Service (FOS) and the Financial Services Compensation Scheme (FSCS).Please see our Terms and Conditions of business for further information.

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BESPOKE SERVICESWe aim to build lasting relationships with clients so that they can relax knowing that we will tailor individual,high quality solutions to meet their needs. Each client is treated individually with a bespoke plan tailored tomeet their needs and aspirations.

We aim to provide a personal working relationship with each and every one of our clients, to give a wider understanding of the opportunities and possibilities available.

ONGOING FINANCIAL REVIEWSWe believe that ongoing advice is essential. The frequency of reviews and meetings will depend on your needsand objectives. We will discuss these with you and help you to decide which one best suits your requirements.

As part of our review services, for clients with pension and investment funds, our service provides a bespokeportfolio that meets your specific circumstances and requirements, and matches your tolerance for investmentrisk. When we meet with you we will then review your current needs and the performance of the portfolio,and if necessary re-balance your portfolio to ensure it remains in line with your tolerance for investment riskand your objectives. For example, if you have made good gains, you may want to protect some of those gains,or if you are nearing retirement, you may want to move funds into a lower risk environment.

‘AD-HOC’ SERVICESClients can request ‘ad-hoc’ services at any time, such as additional meetings, telephone query handling, additional documentation, valuation reports, or simply to ask us to process a transaction on your behalf.

OTHER IMPORTANT INFORMATIONTERMS AND CONDITIONS OF BUSINESSBefore we proceed with any service, we will give you our Terms and Conditions of Business, which you shouldread carefully.

ENGAGEMENT LETTERBefore we proceed with any service that will require you to pay us a fee, we will detail the fee due as accurately as we can. We will use an Engagement Letter for this purpose and we will ask you to sign a copy before we proceed further. This is so that we can make a clear and transparent disclosure of fees due in ad-vance of any required payment. In some circumstances we will not know exactly the complexity of your circumstances until some research is carried out. When an estimated fee is quoted in the Engagement Letterthe specific fee will be provided in the Recommendations Report. Again, we will ask you to sign a copy beforewe proceed further.

VALUE ADDED TAX (VAT)The majority of our services are not subject to VAT. However, where we provide you with a pure advisory andconsultancy service, where there is no reasonable expectation that the advice will result in a recommendationto transact a financial product or to invest funds, then VAT will be charged in addition to our fee at the rateprevailing at the time the fees are charged.

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Registered in Scotland: SC105200McHardy Financial is the trading name of McHardy Financial

Limited and registered in Scotland.

We are authorised and regulated by the Financial Conduct Authority.

McHardy FinancialIndependent Financial Advisers

Aberdeen:13 Bon Accord Crescent

AberdeenAB11 6DE

Telephone: 01224 578250Facsimile: 01224 573583

Dunfermline:Viewfield House

Castle Business CentreQueensferry RoadDunfermlineKY11 8NT

Telephone: 01383 623300Facsimile: 01383 624948

Email: enquiries@mchb.co.ukwww.mchb.co.uk

MF Client Brochure August 2014