Financial advisers have given a clear thumbs down to the proposed new limited advice AFSL for accountants, despite an otherwise (mostly) positive response from the financial services sector .
83% of advisers have voted ‘no’ to our latest poll question that asks:
Do you support the new limited AFSL that will allow accountants and other advisers to deliver a broader range of financial advice to consumers?
12% of poll respondents support the new limited AFSL initiative , while 5% remain uncertain.
One of the main points of contention on this question is whether accountants are equipped to be able to deliver appropriate limited financial advice in areas such as superannuation, life insurance and simple managed investment schemes.
This concern relates to whether the accountant will have the necessary knowledge and skills and also whether they will have a sufficient appreciation of their clients’ overall personal and financial circumstances in order to be able to deliver financial advice that is in their clients’ best interests. In relation to life insurance advice, one adviser commented:
Accountants, especially in the past, didn’t support life insurance. That may have changed, but their focus is on limiting expense and tax issues, so that could cloud their judgement in respect of life-risk insurance.
This adviser also remarked that the nature of accounting services can be more clinical than broader financial advice: “This doesn’t always allow getting to the real heart of a client’s situation,” he said.
This comment was reinforced by another adviser, who remarked:
… accountants usually know their clients financials but rarely know their retirement goal, family concerns, all their debts, what are their retirement plans and so on.
But others see the proposed new AFSL for accountants and other advisers as a pragmatic step forward. One adviser made this simple observation:
There should be no issues provided the skills and training are at the same standards as the rest of the planning world
The sense we have gained from the response to this poll is that financial advisers lack confidence that accountants will be able to deliver quality financial advice with empathy. But is this an accurate summary of today’s accountant? And could the creation of this new limited advice AFSL lead to a change in the way that accountants structure the advice they deliver?
Our poll remains open for another week for you to add your vote and to make your comments on this proposed initiative, intended to deliver more advice to more consumers…
In my experience accountants look back and record what you have done for tax purposes. They are not proactive in looking forward and planning.
You have note been dealing with the right accountants Patrick. I could make a similar sweeping comment about the competency of financial planners.
I dont see the need for accountants, myself being one, to give advice on simple managed investment schemes. Accountants should be able to give advice on the establishment of a SMSF and the necessary risk insurance. Beyond that any advice should be given by a financial planner.
The problem is usual labor govt, no detail to know what the law will really be. 2 years in the waiting and still no details of how it will work = complete rubbish job by Shorten with ongoing uncertainty of everything and everyone?
And it looks like a complete lack of a level playing field.
– How can accountants be allowed to offer AFSL advice with zero compliance, no fact finds, no SoAs, etc as has been indicated.
– Also how can Industry Funds be allowed to offer lower end AFSL advice again with zero compliance? And also bundle the fee for all members to pay when so few use the service?
Yet financial advisers have massive compliance and costs to do the same work for clients. How can there be 3 layers of complete different rules for essentially doing the same job ??
Happy to compete as long as it is a level playing field. As anyone who does proper AFSL advice & compliance knows it is costly and Financial Advice is no free gravy train.
Unfortunately Silly Billy and his advisers have never been through financial advice so they are trying to make laws with no understanding of what exists.
Fundamentally he does not understand the existing FSRA and what constitutes “Financial Product Advice” and thus the necessary compliance, so without thus basic “know your existing” laws foundation, how on earth is he meant to provide to laws for the future??
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