Business News

Capacity not financial advice hurdle

Accountants operating as sole practitioners do not need to be concerned about perceived capacity constraints in becoming licensed and adding financial advisory services to their businesses, an industry licensee has said.

“I’ve seen sole practitioners work on a referral basis with other financial planners and I’ve seen it work successfully. I’ve seen sole practitioners as authorised representatives of various dealer groups work successfully. And I’ve seen sole practitioners with their own AFSL (Australian financial services licence) and be successful,” SFG Alliance Services head Dan Powell told the Institute of Public Accountants National Congress recently held in the Hunter Valley.

“So if you’re a sole practitioner, it doesn’t preclude you from one of the [aforementioned] options.

“The preclusion from the options is really [in] your own headspace [about] what you want to do.”

In going through the process of choosing which business direction to take and whether or not to add advisory services to an existing accounting practice, Powell suggested practitioners approach the task as if they were seeing one of their own clients looking to expand their business offering.

“You’d sit down with that client and say: ‘Tell me about your business – what are you trying to do and what is your current client base?’” he said.

Adapting it to the accountant’s set of circumstances, he said the practitioner should ask themselves: “Is it the sort of client base that will be seeking financial advice?”

“In other words, have they got money which they actually invest or superannuation or other assets, so what is it that may compel them to seek financial planning services?” he said.

“Also, [ask yourself] what percentage of your client base already has a financial planner because you can assume you’re not going to target those people [for advice services].”

He said accountants needed to determine the sort of revenue additional advice services could generate for the business as well and get an understanding of whether a financial planning arm would grow the practice’s existing client book.

Copyright © SMS Magazine 2024

ABN 43 564 725 109

Benchmark Media

Site design Red Cloud Digital