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Accounting, Financial Planning, Superannuation

Drop exam, licence for limited super advice

accountants limited superannuation advice

More people could receive assistance if accountants were not subject to licensing or adviser exams in order to provide limited super advice, an industry body has said.

Qualified accountants should be granted interim relief to provide limited advice on super, including SMSFs, without being subject to the financial services licensing regime or having to complete the mandatory adviser exam, according to a major accounting body.

Chartered Accountants Australia and New Zealand (CAANZ) made the call for the relief as part of a submission in response to a consultation paper from the Australian Securities and Investments Commission (ASIC) on the issue of providing access to affordable advice.

The submission said single-issue advice related to superannuation is the “most sought-after topic areas clients continually seek advice from our members, which we believe should be allowed under a broadened scope outside of the AFSL (Australian financial services licence) regime, at least until a strategic model is developed”.

In making the call, CAANZ stated accountants should be able to provide advice on making contributions into an existing fund and drawing a pension from an existing fund for SMSF and non-SMSF vehicles.

The body also suggested accountants should be able to provide advice on the appropriateness of establishing or winding up an SMSF as these were trust structures and structural advice did not require an AFSL, but for any other type of fund accountants would be restricted to where they held an AFSL as this was product advice.

It noted throughout the COVID-19 pandemic its members had been working with individuals and small businesses to access government stimulus measures and as Australia moved into a better position, more people would seek help from accountants who wanted to be able to provide strategic advice without being trapped within the AFSL regime.

“There is an urgency for this advice. Businesses are trying to recover and/or owners are trying to sell or consolidate to salvage what they can. As we believe this single-issue, single-topic advice should not require an AFSL, we seek interim relief for this advice,” the submission stated.

“As this relief is client driven and is a suggested interim solution to assist clients with effect immediately, we do not believe successful completion of the FASEA (Financial Adviser Standards and Ethics Authority) exam is necessary for advice of this nature to be provided.

“We don’t believe highly qualified professionals who wish to solely provide strategic advice should necessarily fall under the FASEA umbrella, nor the rigours of the Corporations Act. We do, however, support these regulations in a more simplified format for advisers under a full AFSL who recommend products.”

CAANZ pointed out a precedent had been set under the model adopted by ASIC for single-issue advice related to early access to super and until an industry-wide strategic advice model was developed, limited superannuation advice should be able to be provided by recognised accountants who were members of CAANZ, CPA Australia or the Institute of Public Accountants.

The same relief should also be extended to existing suitably qualified advisers on ASIC’s Financial Adviser Register if their clients need single-issue, single-topic superannuation advice.

CAANZ financial advice leader Bronny Speed said advice reform was at a critical juncture and the body’s submission outlined an approach that segments of the advice profession need until a complete model is developed for the wider industry.

“When ASIC provided temporary relief to tax agents and financial advisers for the early-access-to-super measures, they mobilised a group of ready, highly qualified professionals to address a need,” Speed said.

“There is now a similar need for Australian businesses and individuals to access high-quality, single-issue advice in superannuation to assist with a COVID-19 recovery.”

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