A local industry head has said that financial advisers and accountants working together will help solve the issue of affordable and accessible advice in Australia.
On a recent episode of the ifa Show podcast, adviser and founder of digital solution Scientiam, Nigel Baker, discussed a recent opinion piece published on sister brand ifa in which he argued that the growing number of accountants in Australia (currently at 220,000) could serve as a boost to the advice sector.
On the podcast, Mr Baker said he sits in “both camps” being a financial adviser and a member of the Chartered Accountants Australia and New Zealand (CA ANZ).
“A lot of accountants don’t want to know about advice. A lot of accountants, as we know, have got into advice and some have done it well, some not so well,” he said.
“But what I’m saying, when we’re trying to solve this problem and say we want advice to be more affordable and accessible, well, you look at it and say, there’s 15,000 to 16,000 financial advisers left. They’re just not going to be able to deal with the demand.
“So, you’ve got tens of thousands of great accountants out there and they’re terrified as well to give advice. But we’ve got to make that a bit more accessible. Why can’t an accountant also have a discussion with a client around budgeting and saving, and things like that, within a framework?
“We’re trying to solve the problem for the end client, not have walls between different professions…”
Mr Baker acknowledged that there is contention to the idea, particularly that accountants should have to have the same education standards applied to advisers.
While he agrees that the framework should be similar, Mr Baker said the conversation must be about the benefits to clients.
“We’re talking about professionals helping people now. We’re not talking about products, we’re talking about giving people access to information and advice,” he said.
“Yes, at the end of the day, there might be a product, but I just think that’s a different discussion, as to in the past it was like, well, how can that accountant know all about these different types of products?”
Mr Baker’s appearance on the ifa Show came after ASV Wadeson Chartered Accountants co-founder and director, Jose Alguera-Lara, wrote in another opinion piece for ifa on how the advice and accounting professions are facing the same “war for talent crisis” with planners and accountants leaving the industry and not being replaced by new entrants at the same rate.
However, Quality of Advice Review (QAR) reviewer Michelle Levy recently raised concerns about creating exceptions within the advice regime and indicated a preference for a principles-based regime.
Speaking on a panel discussion on the QAR last week, Ms Levy commented on a proposal by some accounting bodies that called for legislative changes to enable accountants to be able to provide certain types of strategic advice — including SMSF advice.
“I have the concluded view that I don’t like exceptions. I think they are inconsistent with a principles-based approach, which is what I am preferring,” Ms Levy said.
“I worry about creating exceptions, and I think there needs to be a very compelling reason to do that.”
Listen to the full episode with Mr Baker here.
