Speaking at CA ANZ’s National SMSF Conference in Sydney on Monday, the industry body’s group executive of advocacy and professional standing, Simon Grant, said CA ANZ would seek to act on member feedback around the advice process, particularly ongoing confusion around the impact of the FASEA regime.
“We have heard firsthand members’ feedback today on the barriers they face when providing financial advice and have gauged their views on what the future could look like,” Mr Grant said.
“Having just passed three months since FASEA announced its partial recognition of the CA designation as prior learning, we also continue to urge them to clarify what studies will count for further credit.”
He added that it was critical chartered accountants remained in the advice industry as they were highly trusted and well-educated financial professionals who worked to serve the interests of both consumers and businesses.
The comments come following CA ANZ’s opposition to the return of the accountants’ exemption in its joint submission to Treasury’s review of the TPB with CPA Australia last month.
In a recent Accountants Daily Insider podcast, CPA head of public practice Keddie Waller shed further light on the industry body’s reasons for opposing the return of the exemption, saying accountants needed to be less restricted in the advice they could give to SMSF clients.
“The main thing we need to understand is what the accountants’ exemption allowed someone to do — if you were a full member of either CPA, CA ANZ or the IPA, it allowed you to recommend a client to set up or wind up an interest in an SMSF,” Ms Waller said.
“It was so limited it didn’t even allow you to say to a client that you shouldn’t set up an SMSF, or talk about how existing super the client might hold might be contributed to a new super fund.
“We don’t think [the exemption] is going to address the advice gap… it’s not going to help you service your clients for pension advice, contribution advice, even broad asset allocation or strategic advice.”
She added that CPA Australia was advocating a full review of key legislative frameworks affecting accountants including the Corporations Act, the Tax Agent Services Act and the National Consumer Credit Protection Act to remove duplications, as well as potentially adding a “strategic advice” category to eliminate the need for accountants to provide SOAs.
“The complexity we have at the moment is regardless of the advice you’re providing; even if you’re not talking about investing or setting up a product or exiting a product, you’re deemed to be giving financial product advice and that triggers the advice process and all the disclosure obligations,” Ms Waller said.
“So, if we revisit that definition and look to draw out strategic advice as different to product advice, could that enable advice to be provided by a broader range of professionals with simpler disclosure requirements?”
It’s not rocket science just let us do strategy work please.
Clients love accountants because we provided them with a structure that meets their needs without the unnecessary costs. No SOA that’s 80 pages too long with a fee that’s ridiculous based on how many pages are printed. Everyone is missing the point accountants don’t want to give investment advice, our clients want us to provide an alternative to Planners as they simply don’t trust anyone else with their money…
Accountants should be able to advise on SMSF’s on a level playing field with Financial Planners. There’s no reason they should be on a pedestal. The reason SMSF’s are a product is because plenty of accountants have advised their clients into them to generate more accounting work – heaven forbid they are conflicted. To manage this conflict, they are governed by financial product regulation. Look at it from a policy level – this is about developing consistent high level policy governing how superannuation is advised. Regulators don’t care if the adviser is a financial planner or accountant – they want to govern it the same way universally.
Sorry but salespeople are not financial experts. Financial advisers, generally speaking, are nothing more than sales people. Economists, finance graduates and accountants should be the only people in this space. Get rid of the sales people and clean up the space forever.
Sorry but insurance salespeople are not financial experts. Financial advisers, generally speaking, are nothing more than sales people. I think only accountants and degree qualified financial planners should be able to provide financial advice.
John, I am assuming that you are also of the opinion that non degree qualified accountants of which there are still some in existence are also not able to practice. FASEA is fairly straight forward in that if you do not qualify you shouldn’t be allowed to provide financial advice and there is no reason at all why accountants should not be covered by this legislation.
Never met an accountant without at least a degree. Cannot say the same for supposed ploanners.
I have a Masters (which is less than a Phd so at least John has runs on the board in this area). A lot of old school accountants haven’t got degrees and realistically once FASEA comes into play financial planners will be much better qualified than accountants with a basic accounting degree and their CA / CPA TAFE degrees. The two most unethical people I have ever met and who are responsible for the destruction of over $3M in wealth between them are CA’s who had degrees which is why education is not sufficient and licensing is required..
SMSF’s are a structure – not a product. Its incorrect legislation that have made it so. The products/investments are what go into the structure. The products and investments are the field that Financial planners work in – no problem there. The structure is the field that accountants work in. Accountants have effectively been partially locked out of a work area that directly relates to tax strategies. Even when an accountant can see it as plain as a day that it’s not right for a client, they can’t comment without a license. It means the accountant can’t provide the correct advice and service. Its the client that loses here.
Damned if we do, damned if we don’t. Tell a client that their situation is not right, it’s illegal advice. Don’t tell a client that their situation is not right, then it’s negligence.
Sorry Anon. But you are assuming that financial advisers are equal to accountants in skill and education. With some exceptions they are not. I think only accountants should be allowed to give financial advice with the exception of degree qualified financial planners
I’m happy to put 20 accountants and 20 financial planners in a room and pick the bottom 50% in relation to ethics and knowledge. It may be 9 / 11 or 10 / 10 but there are some really awful accountants out there, they are just too hard to sue. Look at Guvera, City Pacific and Great Southern who were most financed via accountants. FASEA has guidelines and everyone who wants to give financial advice should meet them, if they can’t then they shouldn’t give financial advice. Accountants are effectively bookkeepers with a degree, not cardiologists.
Good on the CPA and CAANZ for sticking up for their members. As has been mentioned before this is a turf war. How much study and PD does an accountant need to do. Having done the Study to become CPA and the RG 146, the requirements to become a finanial planner as insignificant in comparison. Accounting PD is a lot more technical and challenging than the Fin Planning 40 hrs. Accountants and CPA do the same thing, a SOA is the same thing as a letter or email summarising/detailing the meeting to help make an informed decision. Insurers will not cover you if you do not heave anything in writing or you have not charged a fee for.
Accountants know everything fin planners know but do not want to sell insurance or specific investments.
For the fin planners out there, Accountants know how to value businesses as well and calculate FV and PV of annuities etc. Accountants full exemption from this non sense. The accounting bodies code of ethics is the same as those in the Corps act. Seriously Accountants do 40 hrs for their accounting bodies, 40 hrs for fin planning and now another 40 hrs for FASEA. Why dont I go back to uni and join the idiot student union. I have a business ot run which means looking after the whole welfare of clients, employees and suppliers. Far more productive. The useless universities, with their low standards are lapping this nonsense up.
Since when did accountants get demoted back to bookkeeper and insurance salesmen become the fountain of all financial knowledge? Or does CA and CPA stand to profit from training to make up for the $6mil they paid out for their recent misjudgment at our expense? I am a CPA member.
Youve said it all and so nicely, accurateley and evidence based.
Regards
The accountants exemption should allow an accountant who has a standing relationship with a client to give financial related advice because that is what we do. We know the client. The imposition by ASIC that superannuation is a product as opposed to an SMSF being another financial entity has created the problem.
No. You should be qualified and follow the legislation relating to financial advice because that is what you are providing. Knowing the client is the base line for any provision of financial advice.
That’s fine but then financial advisers should not have to do Statements of Advice for strategic advice. You can’t have one rule for financial advisers and another for accountants. Example: Other considerations would have to be made too like personal loans to be paid out which could conflict with adding to super.