In light of the scarce take-up of limited licences, their implementation issues and the minimal benefits they provide, one consultancy firm has predicted they may be completely abolished by ASIC.
Mayflower Consulting director Sarah Penn says there has been minimal interest in limited licensing by accounting firms, and among the accountants who did apply for a licence there is still widespread confusion as to what exactly constitutes financial advice and when a statement of advice is required.
“I do wonder whether ASIC in the next five years or so will actually remove the limited licence altogether because the take-up has been marginal and there’s been so many implementation issues with it in terms of how you operate under a limited licence,” Ms Penn said.
As with other types of new legislation, there have been many “teething issues” with the limited licensing regime.
“This would be fine if it was an industry-wide thing and everyone had this new licence [because] ASIC and industry would then have to figure out how to make it work, but there’s only a few hundred licences out there,” Ms Penn said.
“I don’t think anyone at a policy level has the interest or the time to try and figure out all these teething issues, and really, there’s not very much advantage of a limited licence over a full licence.”
Mr Penn said the limited licence has failed to add any real value to the industry and resulted in “headaches instead”.
“I don’t think there’ll be much work done on it and they’ll either die a natural death or at some point someone at ASIC will turn around and say, ‘This is just causing everyone more work for no added benefit’”.
SUBSCRIBE TO THE SMSF ADVISER BULLETIN
- 21 Aug 2016Risks flagged with real estate appraisal valuesBy Miranda Brownlee
- 21 Aug 2016Lawyer challenges ATO view on two fund strategiesBy Miranda Brownlee
- 18 Aug 2017ATO locks in details, addresses panic on real-time reportingBy Katarina Taurian
- 18 Aug 2017Data feeds unreliable for new reporting, says mid-tierBy Miranda Brownlee
- 18 Aug 2017Tax component confusion spurs potential tax liabilitiesBy Miranda Brownlee
- 18 Aug 2017Contributions triple in June quarter, survey showsBy Staff Reporter
- view all
- ATO locks in details, addresses panic on real-time reporting
The tax office has addressed several points of confusion with the new events-based reporting regime, locked in key deadlines, and outlined w...read more
- 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
- view all