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.
Recommended for you
In this week’s episode of Relative Return Unplugged, AMP’s chief economist, Shane Oliver, joins us to break down Labor’s budget, focusing on its re-election strategy and cost-of-living support, and cautioning about the long-term impact of structural deficits, increased government spending, and potential risks to productivity growth.
In this episode of Relative Return, host Laura Dew chats with Mark Barnes, head of investment research, and Catherine Yoshimoto, director of product management, from FTSE Russell about markets in Donald Trump's second presidency and how US small caps are faring compared to their large-caps counterpart.
In this episode of Relative Return Unplugged, we examine the push for superannuation tax reforms aimed at saving $10 billion annually, as well as the immense pressure being placed on Treasurer Jim Chalmers ahead of the budget and Deloitte’s warning of a $26.1 billion deficit.
In this episode of Relative Return Unplugged, hosts Maja Garaca Djurdjevic and Keith Ford are joined by AMP’s chief economist, Shane Oliver, to discuss the ever-evolving state of global markets as the US pursues its protectionist trade war.
