Accountants ‘sold a solution’ with limited licence
One industry figure believes it was ASIC’s intention to limit the number of accountants moving under the AFSL regime come 1 July, drawing parallels with the drop-off of SMSF auditors since registration was introduced in 2013.
Speaking to SMSF Adviser, Reece Agland, principal of Reece Agland and Associates, believes it is ASIC’s intention to “limit the amount of people they have to regulate” in the SMSF advice space.
Mr Agland was senior policy adviser at the Institute of Public Accountants (IPA) when the limited licensing regime was announced by the then Labour government.
“We were sold a solution from ASIC that wasn’t a solution and that was the limited licence. I always saw problems with it, because I understood that accountants don’t want to be financial planners,” he said.
“[ASIC] didn’t want tens of thousands of accountants joining. So I don’t think they’re overly bothered by the fact that there hasn’t been a lot of uptake,” Mr Agland said.
Earlier this month, an ASIC spokesperson told SMSF Adviser that as at 22 February, it has received 323 applications for a limited licence. So far, 95 applications have been approved.
The number of applications received since 28 January this year has increased by 47, and the number of applications it has approved has increased by seven.
Mr Agland believes that in the long term, the government will need to revisit the licensing regime as it stands.
“I think it works for the institutions but it doesn’t work for the individual adviser, or the clients, because it still creates a situation where a licence holder has all the power,” Mr Agland said.
He also echoed ASIC’s warnings that accountants will not be exempt from enforcement action when the new licensing regime kicks in.
“ASIC is going to be doing some cold calling. I’d be very careful if you got a new client who wanted to set up an SMSF if I was an accountant – it might be ASIC calling,” he said.