Mass licence migration tipped for accountants
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.”
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.