Financial planners need to review their business structure - Johnstone
Sequential Project Services has announced that its new targeted review product is now being used by AMP Financial Planners Association (AFPA), Hillross Advisers Association (HAA) and General Insurance Advisers Association (GIAA) to help their members adapt to the current financial industry environment.
According to Sequential, the Business Insights program is helping licensees plug the holes in their businesses which have been left by market changes and regulatory reform.
Sequential managing director Adrian Johnstone said financial planners are often committed first to servicing their clients before considering the effect that market changes and regulatory reform will have on their business.
"Their businesses are leaky boats because they're spending such large amounts of time worrying about compliance and they're not getting the time they need to worry about their businesses and servicing their clients," Johnstone said.
As part of the independent review undertaken by Sequential, Johnstone said he often sees a lot of the operational processes being double-handled, or as clerical duties that an administrator could undertake.
Johnstone said as a result of market changes, business owners are now - for the first time in most cases - starting to ask some serious questions about running a compliant business. Owners are typically not well equipped to review their practice themselves because they are too emotionally connected, he said.
"They (practice owners) feel their business needs help but they can't see where. Businesses are not structured against the new world," he said.
Recommended for you
ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test.
Quarterly Wealth Data analysis has uncovered positive improvements in financial adviser numbers compared with losses in the prior corresponding period.
Holding portfolios that are too complex or personalised can be a detractor for acquirers of financial advice firms as they require too much effort to maintain post-acquisition.
As the financial advice profession continues to wait on further DBFO legislation, industry commentators have encouraged advisers to act now in driving practice efficiency.