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Financial Planning

COVID-19 advice ROA has licensee obligations

Early access super advice

Licensee policies need to be considered before practitioners use compliance documentation relief measures in regards to advice on early access to super.

Practitioners looking to provide advice regarding early access to superannuation under the relaxed compliance rules recently announced by the Australian Securities and Investments Commission (ASIC) still need to consider separate obligations their licensee may impose on them in relation to this course of action, an SMSF Association board member has said.

Superology director Tracey Scotchbrook’s warning is with a view to the regulator’s amended compliance approach allowing advice to be provided about an individual’s legitimate early access to superannuation, under the COVID-19 financial relief measures, with an accompanying record of advice (ROA) as opposed to a full statement of advice (SOA) that is usually required.

“I know for my licensee, they’re encouraging advisers to [prepare] a full statement of advice where ever possible,” Scocthbrook said while participating as a panellist during a recent SMSF Association’s COVID-19 webinar.

“My licensee has not said we can’t [use the ROA instrument] but what they are pointing out is they’ve got concerns about some of the risks [involved],” she explained.

“So that could be a scoped statement of advice as appropriate to the client’s circumstances.

“What they’ve highlighted is to the adviser group is that it’s really only in those extreme and extenuating circumstances that the ROA [course of action] should be considered.”

“I think advisers really need to have a look at what are the policies and procedures that their AFSL (Australian financial services licence) [holder] are requiring of them,” she recommended.

To this end Scotchbrook suggested practitioners access their licensee support materials such as advice hubs and technical teams to assist them in establishing greater clarity regarding this situation.

She added advisers needed to recognise the purpose of this relief measure when looking to use it.

“This [instrument] has been put in place to simplify the advice process and [facilitate] expediency. I think that’s a key component remember and there is nothing prohibiting you from [preparing] that full statement of advice.”

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