One on one with…Julie Taylor

Julie Taylor

Keep it Simple Super founder Julie Taylor took an instant like to working in the SMSF sector. She shares with Darin Tyson-Chan her concerns about the quality of record-keeping and the difference receiving the SPAA Chairman’s Award has made to her professional life.

How did you first get introduced to the SMSF sector?
I started my accounting career with a sole practitioner in 1999 doing a variety of accounting work, including company returns and work involving SMSFs or excluded funds, as they were known at that stage. I found I could really relate to SMSFs because it was something I could do, like take some money and buy a portfolio of shares. It was also interesting to me seeing the different things people were doing and the gains they were making, so it’s what I liked and enjoyed being involved with.

You now run your own SMSF business. What services do you provide?

We offer administration services to accountants and financial advisers. We see ourselves as providing support to them. So they’re the ones who are giving the advice to the clients and they’re the hub of the client relationship, but we’re the ones who provide the technical expertise to them, help them with preparing the SMSF accounts and keep them up to date as well with what’s happening in the sector, so the thing we really focus on is the practical side. These days there is no end to the technical information from the internet, but there’s still a big gap between having that information and applying it in a practical sense.

Are there any obvious areas practitioners are really struggling with right now?

Fund statutory records is an area of concern and the most neglected part of the equation. I think there’s a lack of understanding of exactly how much wealth is sitting in SMSFs and how important these records have become. You’ve got a lot of old funds where people couldn’t care how the paperwork component of the permanent records and those master records were compiled. This attitude may have been okay when the fund had a balance of $100,000 and it was going to be wound up if these assets were lost. But now you’re dealing with SMSFs that hold the majority of people’s wealth, but the legal aspect is not there to support it. The legal set-up is supposed to be the foundation of the structure, but in some cases it’s not a very solid one. So we’re trying to educate advisers about the importance of getting the legal side right because in my mind the lawyers will be the next set of individuals having an impact on this sector. They’ll be the ones looking at people’s estates and perhaps helping the next generation challenge some of the existing legal structures. The next generation are more educated and are armed with more information than ever before and smart lawyers are going to tell them what their rights are too. So if you have a situation where you haven’t made sure all the i’s are dotted and the t’s are crossed, you’ll end up with dramas.

How hard is it to attract clients?

My biggest lesson from a marketing sense is that there’s no magic bullet. We spent a lot of money on marketing to get a brand presence. It meant paying for proper logos and a trademark and we did it because we felt it was important for the longevity of the business. But if you look at funds we work on and where they’ve come from, the most effective way to attract new clients is through referrals. So it’s literally other people saying “here’s a provider that I’ve used”. And there is no quick win with the referral model because you’ve got to be able to prove yourself to a client before they’ll refer you onto someone else. We also look at how we can collaborate with other people.

We have some really strong relationships through our involvement with SPAA as there are a lot of other professionals running the sub-chapters and the like. So we’ll talk to them about our business and whether or not there are any opportunities present. It pays off in terms of strengthening the relationships you have in the industry, which can in turn lead to more referrals.

Has your SPAA specialist accreditation helped in this area?

It has and the SPAA specialisation has always been important to me. SPAA has established itself as the peak association in the space and it’s been extremely valuable to me because it brings a lot of different professionals together. It means you have a broad range of people to speak to with a number of different perspectives. Personally over the past few years I’ve learned a lot more about the legal side of things I never really appreciated as an accountant. In terms of dealing with other professionals, I think the important factor is more about what you’ve contributed as a result of your accreditation. If all you’ve done is got the accreditation, but done nothing more with it, then all it is is a symbol and if it is a symbol only, it’s like any other marketing tool – it’s not the magic bullet that is going to help you attract clients.

You received the Chairman’s Award at the SPAA National Conference last year, recognising your work behind the scenes and your contribution to the association. What difference has that made to your experience as a practitioner?
Any recognition is nice and it’s certainly good for your self-esteem. From a practical point of view it’s afforded me a lot more opportunities to do things I wouldn’t normally have had the chance to do. So at the moment I’m writing a module with Liz Ward (SPAA education manager) for the graduate certificate. I’m writing the first module, which covers SMSF best practice. It’s a massive privilege for me and I feel very honoured to be asked to contribute in that way. It’s also enabled me to strengthen my relationships with key people within SPAA, making it easier to draw on them for support.

Do you think the licensing requirement for accountants will affect your business?

A lot of people are talking about accountants at the moment in regard to two aspects – one’s the licensing and the other is the technology piece. There’s a lot of speculation as to how it will play out, but I think people are just forgetting the background of the accounting profession. It’s all relationship based. Accounting is one of the most trusted professions in Australia, and I think the impact by the technology or licensing will be a question of how healthy and effective the dialogue they are having with their clients about these subjects is. It will involve things like asking the client if they want financial planning as an additional service and whether they want more automation at a lower cost. If they’re keeping up that type of communication with their clients, I don’t think the licensing would send them out the door without any sort of warning. So I think it’s pretty unlikely it will have a huge effect.

What’s the biggest change to the sector you’ve seen?

I think the introduction of Simpler Super in 2007 was the biggest thing to happen to the sector – when pensions became tax free. There was a lot of complexity in the space before then. You had defined benefits, reasonable benefit limits and the like. It meant there was really complex structuring with big tax consequences if you got it wrong. Once pensions became tax free it made a big difference. It’s probably even impacted on the growth of the sector, even though tax-free pensions apply to all parts of the superannuation industry.

If you could change one thing about the sector what would it be?

At the moment it would be the focus on cost. I think the focus really needs to be on value and best practice. You can be getting services cheap and fast, but if the result is wrong, then it’s of no use. I think you get what you pay for. There needs to be an appreciation that getting the numbers right does matter and getting the paperwork right is important, especially if the next generation and their lawyers start questioning why they didn’t get the level of benefits they feel they were entitled to.

What’s the biggest challenge facing the sector over the coming year?

Because of the focus on the impact of licensing and technology on the sector, I think it will be the ability of practitioners to define and know the role they play in the space. I think people really need to make a decision as to what they want to do and really put their stamp on the space they want to occupy in the industry. There’s a big push for change and they can’t put their heads in the sand about it. They’ve got to be conscious of the situation and communicate to their clients about how they will react to these changes.

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