News in Brief

• Being Overweight the New ‘Normal’;
• Synchron Seeks Direct Payments to Advisers;
• Admin Costs Advisers $15,000 a Year

Being Overweight the New ‘Normal’

Two in three Australians are now above the healthy weight range, according to new research issued by the Heart Foundation.

The report showed that the average Australian man now weighs 85.9kg, which is an increase of 6.5kg over 25 years. Women have gained 5.7kg in the same period, with the average Aussie lady now tipping the scales at 71.1kg.

The analysis highlights that the average BMI for men is up from 25.3 to 27.9 since 1989, and the average for women is up from 24.3 to 27.2.

“To return to a healthy weight range, an average man would need to lose 8.9kg and a woman would need to lose 5.7kg,” said Dr Rob Grenfell, the Heart Foundation’s National Director of Cardiovascular Health.

“The combined weight loss required is just short of 120 million kilograms across the nation.”

Synchron Seeks Direct Payments to Advisers

Synchron and law firm Lander & Rogers are seeking amendments to the Corporations Law Act to allow financial advisers to receive payments directly from providers.

According to Synchron, the law currently imposes a particular business structure on financial advisers who act as authorised representatives of an Australian Financial Services Licensee. The arrangement means that licensees receive payments from product providers for the work done by advisers, with this then passed on to the adviser.

Synchron Director, Don Trapnell, said this exposes financial advisers to risks over which they have no control: “At the moment, if a licensee is placed into liquidation their advisers have to compete with other creditors for payment of their services. This seems very unfair given that advisers have already provided the services to clients and product providers have already paid the licensee for those services.”

Synchron and Lander & Rogers have lodged a joint submission to Treasury, proposing that licensees be regarded as agents of advisers for the purpose of collecting fees and commissions. The submission notes the collapse of AAA Financial Intelligence in early 2013, which resulted in losses to advisers of a reported $300,000, and the collapse of Australian Financial Services,  formally wound up in May 2013, which resulted in losses to advisers of a reported $1.5 million.

Admin Costs Advisers $15,000 a Year

Advisers are losing up to $15,000 additional revenue each year because of the time spent on administration and compliance, a study by CoreData has found.

The Business Efficiency Report revealed that administration and compliance make up around 30% of Australian advisers’ total time, split roughly evenly between general admin and regulatory compliance. International advisers spend less than 20% of their time on these tasks.

Kristen Turnbull, Head of Financial Services at CoreData said: “Administration and compliance are a ‘necessary evil’ for financial planning practices and licensees, particularly when it comes to the implementation of the FoFA reforms. However, our research shows that reducing the burden of these activities can have a tangible impact on growth and profitability.”

CoreData estimated that if Australian advisers reduced the time spent on compliance and administration to that of the international average (19.5%) they stood to earn an additional $4,035 per quarter, or $15,284.10 per year.