One of the current pitfalls in the SMSF sector is the ease at which accountants and advisers can provide advice they’re not authorised to give, said Sophie Gerber, principal of consultancy firm Sophie Grace.
“For example, most accountants have a range of clients, all of whom have superannuation. There is the potential in their capacity as an accountant that they step outside of this role and provide financial advice in relation to superannuation,” she told SMSF Adviser.
“I think what happens is that they’re trying to look after their clients and they either forget, or it’s verbal and it doesn’t get written down, but then it comes back to bite them later if something goes wrong with that particular investment,” she added.
Ms Gerber expressed concern that the risk of unauthorised advice will be heightened when the new licencing regime for accountants officially begins in June next year.
It’s “very difficult” to stay within the scope of a limited AFSL, she said.
“Once you start giving limited advice people are going to keep coming back to you for more and more advice,” she said.
“We would definitely encourage SMSF accountants and advisers to seek this new limited AFSL and take advantage of the transition period offered by ASIC.
“For accountants looking after a number of clients with various investments and financial interests, obtaining an AFSL provides a very promising opportunity for them to explore.”
Could not agree more with Stuart
Shock horror fancy accountants helping people instead of ripping them off
Here is a thought why not do away with all regulation and licencing? – remember recent problems have been caused by licensed advisers anyway.
The licensing causes more problems than it solves
What a pile of “cobblers” I have no interest or expectation in giving investment advice – I want to discuss the pro’s and con’s of starting and running an SMSF, act as accountants for accounts and tax, and assist with paperwork associated with minutes and pensions. Some of that is covered by the “new” regime and hence, I will have to have some limited licensing, but I am smart enough to know that I do not have the knowledge to give advice on what to do with money – that is the investment adviser and they should be called in at that stage. I think that you will find that most of us are similar in that respect. If the licensing allows us to give advice on a more widespread basis, then that is a problem with the licensing not the accountant.