Large numbers of accounting firms are expected to change licensing providers over the next year, as many are dissatisfied with the provider they are with, according to one financial services firm.
Merit Wealth accountants services director David Moss says in the lead-up to the end of the accountants’ exemption, many accounting firms rushed into a decision about which licensing provider to go with and based their decision purely on price.
These accounting firms got licensed purely because that was the legal requirement. They believed it would not bring clients any value, Mr Moss told SMSF Adviser.
“Over the next year, I think a big chunk of accounting firms are going to move again, because there’s a lot of them that have jumped into the cheapest offerings. They’re paying $4,000-$5,000 or $6,000 for a firm, and for that they’re only getting a piece of paper that says they’re on a licence and that’s pretty much it,” he said.
“Price is always going to be a big thing, but if I’m paying five grand or six grand for a piece of paper, and then someone says give me an extra thousand bucks and for that I’ll give you all these extra bits and pieces, that’s going to be a much more attractive offer.”
The issue with the cheaper licences, is that accountants do not receive an adequate level of support, Mr Moss said.
“It’s like getting into a motor bike and not knowing what the pedal or the break is, or the accelerator, and not until you have to move it along or you have to stop do you realise that’s the thing you haven’t learnt.
“Someone could be under a licence talking to clients for six months, thinking they’re doing the right thing, until ASIC takes a look at them and requests documents such financial services guides and statements of advice, which haven’t been provided.”
SUBSCRIBE TO THE SMSF ADVISER BULLETIN
- 08:20Data feeds unreliable for new reporting, says mid-tierBy Miranda Brownlee
- 08:00Tax component confusion spurs potential tax liabilitiesBy Miranda Brownlee
- 08:00Contributions triple in June quarter, survey showsBy Staff Reporter
- 17 Aug 2017Industry questions ATO’s capacity for new reportingBy Miranda Brownlee
- 17 Aug 2017Qld succession law changes tipped to impact SMSFsBy Miranda Brownlee
- 16 Aug 2017Contribution limits restricting future balances, warns mid-tierBy Staff Reporter
- view all
- Data feeds unreliable for new reporting, says mid-tier
With an estimated 20 per cent of SMSFs still encountering errors from data feeds, one mid-tier firm believes the ATO should allow SMSF pract...read more
- Tax component confusion spurs potential tax liabilities
A lack of understanding around taxable and non-taxable components in super funds could be exposing SMSF clients to unnecessary tax liabiliti...read more
- Contributions triple in June quarter, survey shows
The average contribution amount from SMSF trustees tripled for the June 2017 quarter, with super members looking to maximise their contribut...read more
- Industry questions ATO’s capacity for new reporting
With events-based reporting set to generate huge amounts of data, concerns have been raised about whether the ATO’s systems will be able t...read more
- view all