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When the dust settles

By SMSF Adviser
04 December 2014 — 3 minute read

The IPA's Vicki Stylianou speaks to Katarina Taurian about the necessity of referral relationships for accountants when the accountants’ exemption is phased out in 2016, and offers tips to those accountants looking to initiate them.

When the dust settles on the new licensing regime for accountants, what would you like to see happen in terms of planner-accountant referrals?

If members who are not interested in becoming licensed themselves were to put into place a really, really good referral system with advisers and planners they can totally trust their clients with – who they know is going to have their clients’ best interest in mind – I think would be really effective.

We certainly suggest to members that they put in place a formal arrangement so that everybody is very, very clear as to what is going on.

A lot of the stories so far have been that some of our members can’t find planners to develop good relationships with, although that’s not all of them of course. But I think it would be great if they were all to find organisations or planners that they can have a good solid relationship with for the benefits of their clients.

Given the historic animosity between planners and accountants, how should accountants go about initiating these referral relationships?

There are always checklists that you can refer to in terms of making sure that you can pick someone you can work with. At the end of the day, it’s really a case of building a relationship with someone you feel comfortable with. Just from talking to members over so many years, the thing that seems to be common is having someone that they feel very comfortable working with and confident about.

A lot of accountants fear losing business if they get into a referral relationship with another professional, what is your response to those concerns?

I would say that they’ve got to think of their clients’ interest. All the research shows that clients demand holistic services from advisers they can trust. But it’s not just one adviser, it’s different advisers for different aspects.

It really is a case of building those referrals, building those networks and those relationships, really for the clients’ sake.

If they’ve had a bad experience, or they’re having difficulty finding someone they can work with, then that’s where our job as their association and the other associations can assist them.

How necessary do you think it is for accountants to have referral relationships, particularly post-2016?

I think it’s going to be critical, I don’t see how anyone – financial planners, tax agents – can really work in the best interest of the client unless they’re able to provide holistic services. If they can’t do that themselves they’re going to have to have a referral network in place, with people they trust and have a good relationship with, preferably a formal relationship because sometimes things might go wrong, people need to know exactly where the relationship stands legally as well.

So, I think it’s going to be really, really critical and I think that the way the world is going these days there is so much happening, there’s so much change, that you do need the advice of different professionals.

Are you confident that planners and accountants are going to get on board with initiating these relationships?

I think that in time and hopefully, you know by 2016, most of them will. Already a lot of accountants know that they can’t do it all themselves and there’s also a lot of accountants I think who don’t really want to go and do more education and training and would rather just refer financial planning and financial advice to someone else.

With the limited licensing regime, where are accountants at now compared to this time last year, have you seen any movement over the last 12 months?

There’s certainly a lot more interest, there’s still quite a lot in the pipeline and there’s more interested in doing the education and training. So there’s more movement, probably not as much as I would like, but definitely more movement.

There’s still a good half of them who haven’t decided. Also, the limited licence numbers are still very low, so I think most accountants are realising it’s probably not the way to go. I think that most of them will realise that might not be the most suitable for them not just because of the compliance problems that they would have to face but also because they wouldn’t be able to give investment advice or strategic advice to their clients.


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