Businesses shy away from financial advice
Only one in three Australian businesses uses a financial adviser, while one in five businesses have no intention of using one, possibly due to a lack of confidence in the financial planning industry.
Such is the finding of global debtor finance specialist Bibby Financial Services, whose Bibby Barometer also found that three in 10 businesses that do not use a financial adviser want to do so in the future.
Managing director, Mark Cleaver, believes getting financial advice makes it easier for businesses to manage cash flow, but said recent events may have been a deterrent.
"The financial advice industry has gone through a huge shake-up in recent times. Press coverage of banks giving poor financial advice could well have deterred many businesses from seeking financial advice," he said.
"The general reluctance to seek financial advice could also be due to the fact that one in five businesses holds its assets in cash rather than in riskier assets."
Family-owned businesses are more likely to get financial advice compared to larger businesses (36 per cent compared to 27 per cent), possibly because their financial prospects are more closely linked with their business.
More than half (57 per cent) of the 620 businesses owners surveyed seek business advice, while 57 per cent look for tax advice, 33 per cent want superannuation guidance, while 23 per cent want to know how to manage risk.
Businesses also seek more advice if they feel more pessimistic about their outlook. For example, Western Australia are most likely to seek financial advice (47 per cent).
But only 25 per cent of Queensland businesses intend to seek advice, reflecting optimism about their outlook, Cleaver said.
AUTHOR
Malavika Santhebennur
Recommended for you
Results are out for the latest sitting of the ASIC financial advice exam, with the pass rate falling for the second consecutive sitting.
Adviser losses for the end of June have come in 143 per cent higher than the same period last year, and bring the total June loss to over 350.
ASIC’s enforcement action is having an active start to the new financial year, banning a former Queensland financial adviser for 10 years in relation to fees for no service conduct.
ASIC has confirmed the industry funding levy for the 2024–25 financial year, and how much licensees can expect to pay.
