Accountants who plan to offer advice on self-managed superannuation have been urged to consider their licensing options well ahead of the expiration deadline for the accountants’ exemption on 1 July 2016.
Kath Bowler Consulting director Kath Bowler said accountants should regard the incoming licensing requirements as an opportunity to expand their businesses rather than a challenge they needed to overcome to be able to continue in their existing roles.
“If you are getting licensed to do what you always did, I think you are missing the opportunity,” Bowler said.
Accountants who wish to advise clients on establishing or winding up SMSFs will have to either hold an Australian financial services licence (AFSL) or become the authorised representative of another AFSL holder to do so from 1 July 2016.
Bowler said before deciding on whether to become licensed and what type of licence to seek, accountants should decide what they wanted to do with their business.
“The first step is to work out where you want your business to go. The next step is to work out where you want to be in the business,” she said.
Accountants could incorporate personal and SMSF advice into their broad account practices or specialise in SMSF advice after getting the appropriate licences, she said. Alternatively, they could form partnerships with financial planners to provide advice services.
Accounting businesses that failed to consider how their clients would receive strategic and investment advice would run the risk of losing clients to other professionals, Bowler added.
Australian Unity head of financial advice Craig Meldrum said accountants who were considering becoming authorised representatives of other AFSL holders should make sure they conducted due diligence on the groups and ensure the services they needed would be covered.
Accountants who were considering starting their own licence should be aware of all the costs and consequences of such a move, Meldrum said.
“It’s really important to consider what the implications are of getting your own licence. Getting the licence is the easy part … if you are committed to [self-] licensing, do it fully, do it properly and don’t take short cuts,” he said.
He said it cost around $8000 to $10,000 to obtain an AFSL, and around $5000 to $7000 a year to maintain it. However, there were other costs the business needed to shoulder, such as compliance costs and professional indemnity insurance, which was more expensive for financial planners than for accountants.