CPAs warned they still need licences
CPA Australia expects many of its members will still have to apply for a financial services licence, despite the body probably being granted a professional body exemption.
CPA financial planning industry adviser Kathy Streeter said the fact that many accountants will be providing product advice will mean they will need a licence under the proposed Financial Services Reform Bill.
"We envisage the licensing exemption for professional bodies will not cover providing financial product advice," she says.
"If a practitioner is undertaking accounting work with some advice, they will not need a licence, but if they are offering a full financial planning service, then they will need to be licensed."
Speaking at the inaugural CPA financial planning conference held in Melbourne last week, Streeter says product advice will cover areas such as shares and unit trusts. That advice will need to be licensed, she warns.
Accountants giving general advice on subjects like superannuation will not need licensing as that could be covered by the professional body exemption.
However, Streeter admits if ASIC grants the CPA this exemption (and feedback suggests the association is likely to achieve that status), ASIC will be watching its operation closely.
"If we have members who break the rules and do not stay within the specific types of advice, ASIC will revoke the exemption," Streeter warns.
If the exemption is revoked, all CPA members will have to become licensed, so pressure will be applied to the CPA membership to conform. It is believed only a couple of cases of wrongdoing might cause ASIC to respond, Streeter says.
"The exemption would be granted to the individual body so if one CPA stepped out of line, it could affect the whole membership," she says.
The possible arrival of the exemption will also cause the accounting body to lift its own game, the audience was told.
CPA Australia would have to revamp its professional development program to encompass the stricter education requirements of such an exemption. The association would also have to join a dispute resolution scheme and develop a code of conduct before an exemption was granted by ASIC, Streeter says.
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