Accountants stand to benefit from the widespread changes set to overtake the financial planning sector and should be actively considering how they can regain their place as the trusted adviser for their clients, according to an accounting business practice consultant.
Smithink director David Smith said the impact of education and remuneration changes, combined with the reputational damage stemming from the banking royal commission, had raised questions around the future of financial planning.
“The reputation of major financial services institutions has been trashed due to fee-for-no-service, poor advice and conflicts of interest,” Smith said.
“At the same time, there has been a flight of financial planners from the industry due to FASEA (Financial Adviser Standards and Ethics Authority) education requirements, the increasing compliance burden and the loss of commissions,” he said.
He said the likely shift to fee-for-service only was not a business model with which some planners were comfortable, nor would choose to operate under in the future, but it offered good opportunities for accountants to provide holistic advice.
“The stars have aligned for the accounting industry, which already has a highly trusted position with clients,” he said.
“The removal of commissions means the fee model for advice will more closely align with the way accountants have always worked.
“Every accountant should consider offering holistic advice. They already have a trusted position with clients and should be the first point of contact for issues around wealth management and risk management.
“Doing nothing in response to these changes is not an option if you have a focus on the best interest of clients. Given these changes, there is a space to be the natural provider of advice going forward.”