The Financial Adviser Standards and Ethics Authority has released two legislative instruments this month, with one of the instruments setting out the ongoing CPD that will be required under the new standards.
Licensing for Accountants chief executive Kath Bowler previously pointed out that the standards still don’t differentiate between accountants operating under a limited AFSL and financial advisers under a full AFSL.
Easton Wealth accountants services director David Moss agrees that FASEA doesn’t seem to recognise that the number of accountants operating in the licensing regime in recent years has skyrocketed following the removal of the accountants’ exemption.
“If accountants are required to do 40 hours a year of training and they’re only licensed for super, what are they really meant to do? Is FASEA really proposing that accountants do 30 hours on SMSF and superannuation training a year?” Mr Moss said.
“How much can you really learn? You put money into super, you take money out of super, there are different types of superannuation products, but how many times can you read the same stuff over and over again?”
While Mr Moss said that this level of CPD might be useful for a full financial adviser covering a variety of financial planning areas, it seems odd for accountants who are only dealing with SMSFs and superannuation.
“The same issue applies to someone who just does insurance,” Mr Moss said. “The reality is that if they’re only focused on one area, that’s the area they’re going to lean towards, so that’s the area that they’re going to do their professional development in.”
The fact that anyone in this position needs 9 hours a year of “professionalism and ethics” training speaks volumes to the level of rot that exists in the financial planning industry.
The ethics of the profession are simple: Do what is in the best interest of your client, within the scope of their understanding and risk profile. Do enough work to understand what the aforementioned is, and to understand what products best meet these needs. Don’t recommend products purely because you get a benefit out of it, make sure they are a genuine alternative for the client. Don’t charge people for work you aren’t performing.
If every adviser in the industry stuck to those four principles then the industry would be much simpler and need much less regulation. It just seems that the industry broadly has problems with those concepts (which baffles me to this day).
Honestly, how hard is to be honest and not be a terrible person.
There have been so many changes to the superannuation and taxation laws over the past two years such as Pension TBAs, NALI Bill, ATO Reserves Guidance and at least 30 pages of guidelines on death benefits from the Commissioner of Taxation. 40 hours is almost a bare minimum. Remember Cam & Bear where the auditor was sued for negligence. I bet he thought that a SMSF was simply “You put money into super, you take money out of super.” Maybe he did not realise there was 2,800 pages of legislation that applies to SMSFs.
Yes it’s ridiculous. It also proves that the educators don’t realise that having a top notch phone based Tech Services Dept does away with most of the unnecessary continual education, in reality. Calling Tech Services is a far better investment of time
The training requirements are onerous but this was on the wall for quite a while now..FASEA seems to have trouble with understanding how a lot of things actually work in the real world. The root of the problem was the Limited Licensing regime in the first place. Let the accountants back in, I say, but this ain’t gonna happen anytime soon.
The minimum hours are: Technical 5 hours (you would choose your technical specialisation); Client care and practice – 5 hours; Reg compliance & Consumer Protection – 5 hours; Professionalism & Ethics – 9 hours. The remaining 16 are for ‘qualifying CPD’. Most professions are already doing this level of CPD