The SMSF Professionals’ Association of Australia (SPAA) has welcomed the announcement of soon-to-be-released draft legislation to regulate financial advisors and accountants operating in the SMSF space.
The association supports the broad thrust of the financial reforms announced over the weekend by the Minister for Financial Services and Superannuation, Bill Shorten, but wants greater focus on competencies and a level playing field.
With the removal of the exemption that allowed accountants to advise clients on setting up a SMSF, licensing becomes a critical issue for accountants.
SPAA chief executive Andrea Slattery said she was encouraged that organisations such as SPAA were likely to be given a greater role in the new licensing regime.
“As SPAA enters its 10-year anniversary, it’s fitting that we have achieved such recognition alongside the major accounting bodies,” she said.
“The majority of SMSF trustees get professional advice from SPAA member across all services, such as accounting, legal, auditing and financial planning.”
Central to the new licensing regime is that practitioners who have attained an appropriate level of competence should be recognised, regardless of which professional body they are affiliated with.
“SPAA was the first organisation to promote and recognise specialist SMSF competencies and the statements made by the minister are a strong indication that SPAA’s specialist advisor designation ‘is in the mix’ and will be appropriately recognised in the new licensing regime,” said Slattery.
She added that SPAA was encouraged by claims in the explanatory material that the new licensing regime for accountants would create a level playing between financial advisors and accountants operating in the SMSF space.
“While the reforms announced lacked detail in that regard, we are cautiously optimistic that this important goal will be given appropriate consideration in the final legislation,” she said.
AMP’s head of SMSF advice, Kath Bowler, said the announcement of a Limited Australian Financial Services Licence (AFSL) for accountants would strike a balance between extending the advice accountants can offer, while keeping the licensing solution relatively simple and attainable.
“The move represents an opportunity for accountants to provide a more comprehensive service to their clients and will allow their practices to thrive in the future,” Bowler said.
“This is also an opportunity for our existing aligned financial planners to explore and grow their relationships with accountants not looking to take on the responsibilities of licensing.
“It’s important for accountants to be able to offer the support and expertise their clients are demanding, which is why AMP’s Financial Advice Network established SMSF Advice in late 2011 to focus solely on the licensing needs of accountants and SMSF specialists.”
Bowler said SMSF Advice will review its licensing options in light of the government’s announcement.
“At this early stage, we believe our existing range of licensing options, together with the new limited AFSL and referral opportunities with our aligned financial planners, provides accountants with the choice to begin or progress down the path of their journey into financial planning,” she said.
And why was the transition period effectively 4 years?
One must really ask if these new reforms will actually be put into practice. They are a good idea, strange though that there is a transition phase from 2013 to 2016, problem is that we are to have an election in 2013 some time. One must ask the question: what is the opposition going to do and what is their position on this matter? We must wait until we see the draft Regs from Mr Shorten whenevr they are released.