Removing the accountants' exemption
The industry is still waiting on an announcement from the Government following the decision to remove the accountant exemption on providing advice on SMSFs as part of FOFA.
The accountants’ exemption – which allows professional accountants to provide advice on the establishment and closure of SMSFs – was introduced in 2004 as part of the Financial Services Reform Act 2001 package.
However, in a bid to increase access to high-quality, affordable financial advice for all Australians, the Federal Government proposed the removal of this exemption as part of the Future of Financial Advice, but promised to find a workable replacement.
For more than two-years the accounting industry bodies and policy makers have been trying to develop an appropriate alternative that would allow accountants to provide appropriate advice.
The industry bodies supported this objective “due to the shortcomings that the accountants’ exemption posed in its current form,” according to Chartered Accountants.
On 20 February 2012, the Minister for Financial Services and Superannuation, Bill Shorten, promised he would announce the replacement to the exemption in two weeks, but the industry hasn’t yet seen the announcement (as of 11 April).
But the idea of accountants simply getting licensed has been floating around for a while.
In November last year, the Institute of Public Accountants (IPA) announced a partnership with AXA and MLC to provide its 22,000 member base with a comprehensive financial services package.
Accountants are now able to choose from five licensing solutions – three from AXA and two from MLC – and once qualified, members will have the ability to advise clients in relation to the establishment and closure of SMSFs.
Similarly, BT-owned dealer group Securitor has also developed an offering which would allow accountants to continue to provide limited SMSF advice.
Arrangements such as these which provide accountants with the support of a dealer group, compliance tools and training or obtaining an AFSL themselves seem to be the two options available to accountants – for now.
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