CPA Australia has admitted the ability to provide its members with a licensing solution when the accountants’ exemption is scrapped was a driver in the move to establish CPA Australia Advice.
In discussions held during last year’s CPA Australia SMSF Conference and Expo, the professional body continually fielded questions as to whether it could provide a licence under which its members could operate as authorised representatives.
“It certainly was a factor, but overriding all of it was the fact that we felt we needed to enter this market in the public interest,” CPA Australia chief executive Alex Malley told selfmanagedsuper.
“We just saw too many examples of errant behaviour and significant loss to individuals and families, and we just thought with our history of compliance with professionalism in education that we were the best placed to come into the market and set the independent benchmark that’s above and beyond what the law requires.”
Malley explained only CPA Australia members would be eligible to operate as an authorised representative under CPA Australia Advice.
“But there will also be pathways for people who wish to come through and complete the CPA program on their way to becoming part of CPA Australia Advice,” he said.
The new subsidiary will start the process of securing an Australian financial services licence and an Australian credit licence with the view of becoming operational as a licensee in 2016.
Malley revealed CPA Australia Advice’s licensing solution would contain multiple tiers for practitioners.
“We will have all of the potential authority levels. There will be the basic level for people who wish to provide SMSF advice, there will be the strategic level, which will allow people to offer a range of advice, and the comprehensive level, which will be for the full suite of advice,” he said.
“We will provide all of the educational pathways and they will go beyond what the minimum limits are.”
CPA Australia Advice, he revealed, would employ an independent investment committee that would use appropriate research to select a suite of products considered good products in the market.
“But there will be no inducements to use certain products and we will not be producing products,” he said.
“We will simply be providing credible independent advice and where a product is deemed appropriate, it will be recommended, and where it’s not, we may not recommend a product.”
Authorised representatives of CPA Australia Advice will provide advice on a fee-for-service basis only.
Initial demand for the offering had been strong, with over 300 expressions of interest from the accounting body’s members in the five hours following the announcement of the new initiative, Malley said.
