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Accountant investment advice has validity

accountants SMSF investment advice

Unlicensed accountants are able to assist SMSF clients with a fund investment strategy, but should be aware of the limits on the advice they can provide.

Unlicensed accountants can still offer clients much-needed advice regarding SMSF investment strategies, as long as the limitations placed on the advice they provide are maintained, Chartered Accountants Australia and New Zealand (CAANZ) superannuation leader Tony Negline has said.

In a blog on the CAANZ website, Negline pointed out accountants without an Australian financial services licence (AFSL) should not assume they would be prohibited from assisting SMSF clients with their fund investment strategy, but should be aware of the limits on the advice they can provide.

“It is quite common to hear comments that unlicensed accountants in public practice cannot help their clients draft or review their SMSF’s investment strategy,” Negline said.

“The upshot is that an unlicensed accountant can help a client satisfy the investment strategy requirements, but cannot do so in a way that would include the recommendation to acquire, retain or dispose of financial products.”

Citing the latest version of Australian Securities and Investments Commission (ASIC) Info Sheet 216, updated in April 2018, he noted accountants would not be prohibited from providing a recommendation to clients as to what proportion of SMSF funds clients should hold in broad asset allocation categories, such as shares.

Accountants without an AFSL, however, could not make recommendations regarding which classes of financial product within those categories the client should consider, he said.

“The key issue is unlicensed accountants cannot make recommendations about acquiring, retaining or disposing of any financial product as per ASIC’s list,” he added.

“This does not mean that factual issues cannot be discussed together with appropriate disclaimers.”

In March, Skeggs Goldstien adviser Adam Goldstien called for a licensing regime to be established specifically for the SMSF sector that was structured in a similar manner to the specialist auditor register.

Last year, CAANZ financial advice leader Bronny Speed said a significant number of accountants were deciding to jettison financial advice from their service proposition due to the associated risk involved.

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