Demonstrating value is the single largest challenge accountants face in servicing SMSFs, according to new research.
The OneVue-sponsored “Investment Trends 2014 SMSF Accountant Report” showed the rise of low-cost SMSF administration platforms had increased competition in the sector, making it harder for accountants to show clients they added value.
When asked to select the single biggest challenge in servicing SMSFs, 37 per cent of accountants cited issues relating to value proposition, against 29 per cent in 2013.
The research was based on a survey of 1300 accountants in March and April.
When accountants were allowed to select multiple answers, they also indicated that educating clients and meeting the increased legislative requirements were big challenges.
“We looked at what are the key challenges to do more SMSF advice,” Investment Trends senior analyst Recep Peker said at the presentation of the research last week.
“The challenges are quite particular: one is servicing SMSFs efficiently and being able to service a large number of SMSFs; that is one group challenge.
“The next group challenge is that you are demonstrating value.
“One of the things you will notice is that with more admin solutions becoming available and a lot more accountants adopting the really low-cost pricing model, some accountants find it hard to demonstrate they are adding value and keeping their fees competitive in light of all this additional competition.
“It highlights that they have been doing things one way, but now they have to start to see how they change it to remain competitive and service as many SMSF clients as possible.”
Yet, the research also found accountants were often set in their ways and were reluctant to change their existing set-up.
“For those that haven’t used these [administration] solutions, a lot of them are saying ‘I am quite happy as things are’,” Peker said.
“But as we saw earlier, for a lot of accountants there are a lot of challenges to the way things are right now.”