Accountants looking to be licensed to provide SMSF advice must accept business revenue from that channel would occur gradually rather than instantly, and therefore other value add-ons needed to be considered, according to a licensing solution provider.
“The accountants vary from sole practitioners to multi-partner businesses and what we’ve found is that sole practitioners are really struggling with this whole licensing scenario, mostly because it’s going to be an additional cost to their practice,” Accountable Financial Group (AFG) executive director Tony Zulli told selfmanagedsuper.
“Their view is how do I recover that and do I have enough super and SMSF clients to be able to generate enough revenue over the course of the year to be able to offset the cost of becoming licensed or running my own licence?”
Zulli said the majority of Australia’s accountants were sole practitioners.
“That’s going to be a real challenge for anyone that is targeting accountants for licensing solutions,” he said.
“So you’ve got to start to look at other opportunities for them that will generate some revenue and profit.
“It’s not going to happen straight away; it’s going to happen over a period of time.
“We’re also showing them how they can potentially add further value to their practice so that when they get down the track of selling their practice or succession planning, they’ve actually increased their overall value.”
AFG had received notably strong interest recently from accountants and accounting firms, he said.
“We’ve now got 12 months [until 30 June 2016] and our inquiry rate is increasing quite rapidly,” he said.
“We’re also getting inquiries from accounting practices that already have an existing authorisation with somebody else, they’re looking to see whether there’s a better outcome or solution elsewhere and we’ve already had some experience with accountants becoming licensed, particularly around SMSFs.”
AFG is an independent provider of financial advice, training and product and services solutions to accountants.
Last month, advisory and funds management business Aura Group announced it had purchased a majority stake in AFG, which provided capital for AFG to grow its business aggressively before the removal of the accountants’ exemption.
AFG’s mandate would not change, Zulli said.
“In fact, we’re being encouraged to go out there and pursue more and more accounting firms,” he said.