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Accounting, Financial Planning

Licensing forces industry to rethink roles

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AFS licensing requirements will push more advisers to specialise over time, allowing accountants to take on the role of the generalist for the SMSF sector.

The Australian financial services (AFS) licensing regime could result in more advisers choosing to specialise, leaving accountants with an opportunity to fill the role of the generalist for the SMSF sector, technical experts have said.

Wealth Planning Partners director Amanda Cassar said financial advisers would need to reconsider their roles in order to survive the many changes imposed on their profession in the form of AFS licensing requirements.

“Advisers who can’t [pivot] and think they can keep doing business as usual, it’s not going to happen that way,” Cassar said during the LightYear Docs 2021 Virtual Strategy Summit.

“It’s still a profession a lot of people are very passionate about, but we’re also being thrown a lot of mud very, very quickly and I think it’s becoming more and more difficult to implement every single change.”

She predicted specialisation was likely to become a more popular option for advisers struggling to keep up with the licensing requirements placed on their profession.

“[Advisers] will just say [they] need a niche, [they] can’t do all of this anymore. [They’ll] have to find out what [they] love and want to do, and go down that path,” she added.

According to Easton Wealth accountants services director David Moss, this could lead to an opportunity for accountants currently grappling with the AFS licensing requirements placed on them in order to continue providing SMSF services.

“With licensing generally, and in particular for accountants, it seems like now it’s about who’s going to hang in there for the next three to five years and see what’s coming out the other side,” Moss said.

He pointed out accountants who continued providing SMSF services, despite increased challenges in the form of additional compliance and statements of advice, could find themselves benefiting in a few years’ time.

“If [more] financial advisers specialise, who’s going to be the generalist? Who’s going to be that general contact point to direct clients to different specialists? You’d think accountants naturally fill that space anyway,” he said.

“Maybe accountants’ licensing evolves [and] instead of being about an SMSF focus, maybe there’s being the hub [and] being the trusted adviser like we’ve always talked about.”

Last month, Investment Trends sector research showed accountants wanted to service more SMSF clients and were experiencing a steady level of interest in establishing this type of superannuation fund among their existing clients.

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