The government should introduce a new form of the accountants’ exemption limited to superannuation matters to boost the number of advice practitioners in the market and meet consumer needs, the Institute of Financial Professionals Australia (IFPA) has stated.
IFPA president and chair Scott Heathwood noted a “simple legislative tweak” could be made to allow more consumers to access retirement advice without diluting the professional standards regime created in the past eight years.
“The government has a straightforward lever. Restore a modernised version of the old accountants’ exemption, covering clearly defined areas of superannuation advice provided by recognised accounting professionals,” Heathwood said.
“It leaves every consumer protection in place, while giving Australians access to the affordable super advice they need.”
The proposed scope of advice open to accountants would focus on contribution strategies, transition-to-retirement strategies, account-based pensions and structural and tax-effective retirement decisions. Any form of investment advice, including portfolio construction, asset allocation and managed funds selection, would continue to only be provided by fully licensed financial advisers.
Heathwood added: “This is about regulatory proportionality. Match the licence to the task, recognise the competence that already exists and stop treating experienced accountants as if they are new entrants starting from zero.
“Accountants do the tax work, the compliance work and the structural planning work around super.
“They understand their clients’ circumstances in detail – yet they are prohibited from taking the final step and providing the advice their clients clearly need.”
IFPA estimated up to 30,000 accountants could return to providing limited advice at a time when growing numbers of Australians were seeking help and guidance about preparing for or entering into retirement.
“Thirty thousand professionals is not a rounding error; it is a workforce. They are already in the room with clients, already trusted and already doing the work around superannuation advice in everything but name,” Heathwood said.
“If we are serious about closing the retirement advice gap, this is the kind of supply-side response we need.
“We have a growing population heading into retirement with complex superannuation and tax needs, but not enough advisers to help them.
“The fastest and safest way to fix this is to let appropriately qualified accountants step back into carefully defined areas of superannuation advice.”
Jason Spits
SENIOR JOURNALIST
Jason is a senior journalist with Benchmark Media and writes for the selfmanagedsuper website and magazine and smstrusteenews website. He has covered financial services since 1999 and has written about life insurance, superannuation, investment management and financial advice, in both a freelance and in-house capacity, and also did a brief stint as a media manager for an industry association. He has been the editor of trade titles Money Management and Financial Standard, and was most recently senior journalist with life insurance title Riskinfo.
Articles by Jason