Tax and financial advisers have only five business days to respond to redrafted provisions of a contentious determination that introduces eight new ethical obligations into law.
Minister for Financial Services Stephen Jones committed to additional public consultation on redrafted provisions to 10 professional associations on the day of a failed disallowance attempt on 10 September.
Jones and the crew at Treasury have been hammering away at words to ensure the professional associations are sufficiently appeased by changes designed to make what were originally viewed as draconian imposition on advisers to something that was more workable, and enforceable for both a regulator as well as professional associations.
The comment deadline for submission to the revised Tax Agent Services (Code of Professional Conduct) Determination from advisers is 2 October and a further disallowance motion may be moved in the Senate on 8 October, giving Independent Senator David Pocock and Coalition Senator Dean Smith a week to work out whether to attempt a second disallowance depending on feedback.
A section requiring advisers to tell clients about misconduct they may have done has been given a decent clipping with the shears. Instead, a prescribed list that includes sanctions an adviser might have copped for misconduct has been agreed.
That clarifies what agents need to tell a current or prospective client and it also tells clients what to look out for in a prospective agent.
It is now clearer to a bunch of folks in professional associations that were arguing that advisers would need to tell clients about their mental health status that the mental health status of a practitioner is not a part of the story a client – prospective or otherwise – needs to know.
Most of the information requested would be publicly available and as such advisers would be disclosing what somebody might be able to find jumping on a web browser, keying in some search terms, and finding themselves.
Dobbing in a client for being recalcitrant and not respecting the nudge an adviser gives them about changing information that might be misleading is still in the determination, but that section is much more useful.
There is a table in the draft determination that guides an adviser along a decision-making process that makes the task easier.
Advisers must also be aware that this level of detail in the determination can give rise to questions during a disciplinary process.
Clarity of this kind in the determination gives rise to obvious questions if the adviser comes under firm from their professional body or the regulator because the expectation will be that the adviser followed and documented a process set out in the rules.
