For many years, I have been attending the SMSF Association National Conference. Up until this year, each one has left me enthusiastic and full of technical information and strategies. Unfortunately, the 2018 conference has left me feeling more like a rabbit caught in the headlights of a car called the Financial Adviser Standards and Ethics Authority.
In his presentation to the conference, FASEA chief executive Deen Sanders said he was aware of the anxiety among advisers, but indicated degrees obtained prior to 1998 would be considered sub-standard under the new rules.
His justification was that prior to July 1, 1998, the Australian Securities and Investments Commission did not exist. He reasoned a degree completed prior to the formation of ASIC would not provide an up-to-date understanding of the legislation relating to the regulation of the financial services sector.
He also said, “57 years’ experience does not mean you are qualified; it means you are deeply wise and experienced, but it is not the same thing as qualified”. This, and his dismissal of older degrees, ignores what many professionals have had to undertake by way of education over the last more than 40 years.
My professional life is a good example of this. When I chose to be a Chartered Accountant (CA), in 1970, the superior tertiary qualification was the diploma of business studies – accounting, offered by the then-colleges of advanced education, such as RMIT and Swinburne.
At that time, no degrees were offered by the colleges but the diploma was superior to the degrees universities offered. The diploma allowed automatic acceptance into what was then the Australian society of accountants, or admittance into the CA program, while those with economics degrees had to undertake further study.
The CA program in the early 70s was the start of the professional year that required attendance at 21 tutorials, completion of 21 papers, passing two three-hour exams, and serving three years under the mentorship of a qualified Chartered Accountant.
Since I wanted to assist clients with tax planning and investment advice, instead of only preparing tax returns and accounts, I was required, in the late 1990s, to complete the diploma of financial planning module 8, and pass two exams. The first of these exams related to taxation and superannuation legislation; the second related to ASIC’s regulations.
After having attained the Certified Financial Planner designation, I then had to pass the exam, and meet the eligibility criteria the SMSF Association set for the specialist superannuation adviser designation.
In addition to studying and passing the various exams, I’ve always been required to undertake continuing professional development that covers not only taxation and superannuation subjects, but also all legislative changes relating to the financial services industry, including the Future of Financial Advice reforms.
Unfortunately having done a diploma, which is regarded as a deficient qualification, I will now be forced to undertake two years of further study. Had I done a degree, according to Sanders, despite all of the prior learning, continuing education, and more than 40 years of experience, I would still have to undertake a course of study and pass exams.
Faced with this, I have great sympathy for the dinosaurs that 66 million years ago looked up to see an asteroid hurtling towards them that became their extinction event. If the current position is not reconsidered, professional financial planners that completed their degree more than 20 years ago will be facing extinction, and the Australian public will be worse off.
