With the new standards set by the Financial Adviser Standards and Ethics Authority gradually being rolled out for financial advisers, there has been a lot of discussion in the industry around whether it will see a large number of advice professionals leave the industry, particularly accountants.
Despite some concerns about the FASEA standards, analysis of the ASIC Adviser Register data set reveals that many of the accountant-focused licensing providers have actually experienced a jump in the number of advisers becoming authorised under their licence.
Merit Wealth, an accountant-focused licence owned by Easton Investments, saw a spike in the number of advisers joining last year, with 219 financial advisers becoming authorised representatives in 2018.
This was more than triple the number of advisers added to the licence in 2017. There is now a total of 455 advisers licensed under Merit Wealth following the addition of a further four advisers in January this year.
The other licence owned by Easton Investments, GPS Wealth, has also seen a jump in the number of advisers joining as authorised representatives, with the licence bringing on 122 advisers last year. This was an increase from the 82 advisers added to the licence in 2017.
The total number of advisers now authorised by GPS Wealth has now climbed to 371.
The SMSF Advisers Network, run by the National Tax and Accountants’ Association, likewise has seen a spike in the number of advisers becoming authorised under its AFSL. In 2018, a total of 412 advisers joined its licence, doubling the number of advisers that joined in 2017.
NTAA still holds the lion’s share of advisers when it comes to accountant- or SMSF-focused licensing providers, with a total of 1087 professionals under its licence.
Capstone also saw a small jump in the number of authorised representatives under its licence, with around 68 advisers becoming authorised in 2018, an increase from the 26 advisers that joined in 2017. Capstone now has around 204 advisers under its licence.
Count Financial also saw a small rise in the number of advisers joining as authorised representatives, with 54 joining the licence in 2018, up from 33 in 2017. Count Financial now has 401 advisers.
Last year, Hayes Knight director Greg Hayes said that accountants would need to be authorised by a licence by the beginning of this year if they wanted to be recognised as an existing provider under the FASEA standards.
Mr Hayes said that this prompted many accountants to make a final decision about licensing so that they could take advantage of the transitional arrangements.
“I think what we’ll see over the coming months is a lot of those firms making a decision and deciding whether they’re in or out. If they’re going to be in, then they’ll need to prepare for this new environment that we’re entering into,” he said last year.
Hi David. I think most (if not all) accountants have at least a bachelor degree. Also a good percentage of those accountants also hold a post graduate qualification. That being said most accountants would probably need to complete one to three subjects to maintain their existing adviser status. But 99.999 % of them would not need to do a bachelor degree as they already have one.
Yep for those Accounting Partners who don’t actually provide SoA’s because they have an associated Real Financial Advice arm but these Accountants think / we told / just did in case ………be under AFLS’s.
Welcome to the new world of ASIC Adviser funding $$$$$$.
That’s another great bill to add to service costs that you don’t even need or use.
Shortly followed by FASEA education bills.
And don’t forget Hayne’s newly recommended save everyone at last resort compo scheme that you can bet will also be funded by Advisers $$$$$$$$$$.
Just received my industry contribution levy notice. Zero advice in addition to my normal accountancy services. Fee of around $2500 for a sole practitioner. I’m giving up my licence.
We might have seen a spike in numbers with these AFSL’s but are these AFSL making sure these accountants are actually compliant? Are they, the accountants, providing clients with an SoA, or simply given verbal advice as they have in the past. Are these licensee’s going to be around after 2024 when all financial advisors need to have minimum bachelor qualification? This is just another Dover all over again…accountants finding a Licensee who will accept them with minimum qualifications and allow their advisors to do whatever they like.
Greg Hayes is right on the money. The FASEA requirement to be on the Financial Advice register by 31 December 2018 meant a big rush. We saw 200 complete their RG146 SMSF specialisation in December alone. For those that did not make it, a Professional Year awaits so expect a low take up of new entrants this year. My estimate – 100.