Accountants looking to acquire a limited Australian financial services licence (AFSL) to keep servicing SMSF clients need to be aware of the capacity constraints licensees will encounter as the 1 July 2016 deadline approaches, according to Count Financial chief executive David Lane.
“What’s going to be fascinating is in June 2016 are we going to have 5000 people who come to all of the licensees and say ‘we’re ready now’, [only to have] all the licensees look around to say ‘great, but we only have the capacity this month to take on 1000 people’?” Lane said.
“I think there are going to be capacity constraints on the limited authorisation [option].”
He said he did not see the same issue arising for those accountants wanting to operate under a full AFSL.
“If you want a full authorisation, July 1, 2016, is a non-event because you can get it whenever you want and if you think it’s a good business proposition, you should do it earlier rather than later,” he said.
The decision for accountants to delay the procedure of getting a limited licence was understandable, but did not lessen the problems of making a last-minute move to acquire one, he said.
“If you’re an accountant and you say ‘I don’t want to do anything more than I do now’, you can do that until 2016,” he said.
“Why pay extra money, why do the extra training? You don’t have to write statements of advice and you’re going to all of a sudden have compliance [procedures] and all of the things you didn’t have to have before.
“So I think that there will be a large number of people who try to push it as long as possible if you’re just thinking about the limited authorisation.”
Count launched its licensing options for accountants wanting to provide advice to the SMSF sector last week and having already recognised the problem concerning capacity constraints, Lane said his team was already working on trying to find a solution.
“We are now working through an exercise to figure out how we handle that capacity and how we get people to sign up early because there will be disappointed people, and the best thing we can do for them is this is the process, recognise the capacity constraints, and if you get in early, you will be guaranteed a spot.”
