In the first show of solidarity since the three bodies met formally in 2012, Chartered Accountants Australia and New Zealand, CPA Australia, and the Institute of Public Accountants have now reforged the joint accounting bodies alliance, calling for a more efficient regulatory framework for advisory services.
“The joint accounting bodies have come together today as we believe the time has come to re-examine the frameworks that regulate how financial and tax advice is provided in Australia,” said CA ANZ chief executive Rick Ellis.
“We are working together on a broader and more robust solution to the complexity of the current regulatory framework that will enable both businesses and Australians to not only access the advice they need but understand that advice.”
The tripartite lobbying effort comes as the bodies believe there is a ripe opportunity to persuade the government to listen because the industry is at the crossroads of change, with the review of the Tax Practitioners Board underway, the introduction of new education and professional standards under FASEA, and the fallout of the banking royal commission.
CPA Australia’s regulatory burden report has laid the groundwork, highlighting the onerous compliance obligations borne by public practitioners and the flow-on impact on consumers who face a dearth of accountants able to provide financial advice.
“Accounting professionals need the flexibility to talk and engage with their clients – but this is often problematic when that advice falls under multiple regulatory frameworks in the same conversation, or even the same sentence,” said CPA Australia chief executive Andrew Hunter.
The IPA’s chief executive Andrew Conway, who had previously led calls for a “new, extended accountants’ exemption”, said this combined lobbying effort was needed to address the failures of the Future of Financial Advice (FoFA) reforms.
“Our shared goal is to reduce the regulatory burden on our members, so we retain financial advisers in the industry. For the first time in the best part of two decades we are at risk of creating an advice gap in the market,” said Mr Conway.
“So rather than bringing back the limited accountants’ exemption, each of our accounting bodies in our consultation with our various members has shown that we need to review the regulatory frameworks.
“We have a clear focus to revisit definitions, licensing regimes, and to harmonise obligations when members operate under multiple regulatory frameworks to provide the one piece of advice.”
The joint accounting bodies are now seeking member feedback on client experiences to inform their solution to take to government.
I don’t know why the IPA wants to stoop low to join the other two bodies. IPA accountants are the most qualified in Australia with either an M.Comm (8 units) at AQF 9 or now an MBA (AQF 9 )12 units vs a 5 unit Gd Dip CA (AQF 8) and non-accredited (under AQF framework) CPAA program.
IPA should just stay independent of the other two bodies and be standalone as we are public accountants and mostly firm owners in public practice, independent unlike members of CPAA who are mostly employees and work for others as well as the CAANZ also employees of others.
a big difference between public accountants and employees who work for others.
I agree, accountants don’t want to provide financial advice, we want to give advice about structuring and taxation. It is very easy for practitioners to see the the line that divides taxation advice from financial advice; why is it so difficult for the regulators to see? CPA Australia is conflicted because it has members from the financial planning industry as well as accountants. Their preference is to regulate us all under the one umbrella, but as we have seen, it doesn’t work.
I agree, most accountants don’t want to provide genuine advice and are happy simply talking about superannuation as a ‘structure’, not as an investment product. What’s the difference between an accountant saying you should tip $25K into super and pay tax at 15% on the earnings compared to them saying you should tip $25K into a company and pay tax at 30%. Both are recommendations however since ASIC have decided to call anything super related a ‘product’ accountants can no longer ‘recomend’ actions without a SOA. Complete madness!
It is about time for those professional bodies to get off and do something; until now, they’ve only gone with the wind and presented no practical alternative.
For the most part I would suggest a lot of accountants don’t want to provide genuine financial advice.
I know, and I must acknowledge that there were a lot of accountants who were giving advice.
What accountants want to be able to do is provide structuring advice, help people out with some estate planning questions (because lord knows most lawyers and planners don’t understand the tax) and be able to tell a client “hey you have some spare taxable income over here, chuck it into super and you’ll get a tax deduction for it.”
I’ve legitimately met very few accountants who want, or even feel comfortable doing more than this (although again I can concede there is a lot). The simplest solution would be to change the classification of superannuation (particularly SMSFs) from “product” to “structure/platform.”