Accountants need to decide on AFS licence requirements
Accountants who provide advice on self-managed superannuation funds (SMSFs) need to consider the level of advice they want to give clients before new licensing rules come into force, according to The Fold.
From 1 July 2016, accountants will be required to hold either a limited or full Australian Financial Services Licence (AFSL) depending on the services they wish to provide, senior lawyer at The Fold Legal, Jaime Lumsden Kelly, said.
"Accountants need to decide whether they need a limited advice licence or a full licence," she said.
"The limited licence allows accountants to give some kinds of general and personal advice on superannuation — including SMSFs — and provide strategic advice on basic deposit products, securities, simple managed investment schemes and general and life insurance."
However, Lumsden Kelly warned that those who opt for a limited AFSL would not be able to provide full planning services.
"If accountants want to provide full financial planning advice services, they will need to apply for a full AFS Licence," she said.
Lumsden Kelly, added that accountants would also have to decide whether or not to obtain their own licence, or to become an authorised representative or an existing licensee.
"Acting as an authorised representative does avoid the time and cost of the licence application process and also the ongoing management and compliance requirements," she said.
"It also means you won't need to appoint a responsible manager to satisfy ASIC (Australian Securities and Investments Commission) that you have the capability to provide your services."
However, she warned that becoming an authorised representative of another AFSL might not be the best fit for everyone.
AUTHOR
Nicholas O'Donoghue
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