Speaking at an event in Sydney last month, Mr Fox said many accountants do not fully understand what the new licensing regime will mean for their businesses.
“There are going to be a lot of issues to work through on this. The clarity about professional indemnity insurance is one,” he said.
“Where does the accounting PI start and stop? Do they even know they have to get separate financial advice PI? It’s not covered under the accounting one.
“I don’t know that [accountants have] grasped the complexity that the financial advice world lives in,” he added.
As reported earlier this month by SMSF Adviser, ASIC has approved 149 applications for a limited licence, up from 100 in early April.
A further 308 applications are currently under assessment, up from 228, while 193 applications have been withdrawn by applicants after receiving feedback from ASIC.
It is unclear how many have become authorised representatives in anticipation of the accountants’ exemption phase-out on 1 July; however, it is expected this will be the overwhelmingly popular choice for accountants.
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David, I personally understand the complex world that Accountant’s live in from an advice perspective… There is a lot to keep up with strategically but currently no need for an SOA etc.
It completely different from a compliance obligation perspective to provide financial advice. Chalk and Cheese.
I am sure he is right to a certain extent, but I believe he and other finance experts underestimate the complex world that us accountants live in with the Tax Office and all its intricate legislation.
We will use this skill plus a number of other skills accountant have, to adapt to the “complex financial world” they live in, quite easily.
I believe our abilities are being underestimated once again, this time by the financial services industry.
Thank you, Mr Fox, for your concern but I can assure you that accountants are aware of the complexities and certainly the PI situation. The real benefit will be felt by clients.