As the clock continues to wind its way down to 1 July 2016 all firms need to be firming up their strategy to deal with the new licensing regime that comes into place.
Many with integrated financial planning businesses don’t feel that they need to do much at all. Others are thinking that they merely need to get some training and find someone to give them a license and all will be well. Unfortunately, this thinking misses the main point. Very few firms seem to have thought through the processes and the compliance regime they need to comply with to post 1 July.
Any advice for which an accountant needs to be licensed is subject to that compliance regime. Recommend to a member to increase their contributions above the super guarantee – you need to be licensed. Recommend that a client commences a pension – you need to be licensed. Recommend to a client that they should have a binding death nomination – you need to be licensed.
Well providing that advice under a license might sound OK but have you checked out the compliance regime that your licensee will require you to comply with? Some of the larger dealer groups have been taken over by the lawyers resulting in Statements of Advice (SoAs) that are lengthy and unreadable – SoAs relating to the establishment of a SMSF of 50 or 60 pages are not uncommon. This is not in the best interest of your firm or your client. Advice simply becomes unaffordable or unprofitable for the firm. I have already seen instances of firms becoming licensed and then finding an unexpected onerous compliance regime being forced upon them.
Fortunately, many licensees are starting to address the issue and are developing specific streamlined SoAs for SMSF advice. Many are also developing tools to assist firms to understand the different activities where licences are required or not required. Licensing for Accountants (www.l4a.com.au) have also developed a range of tools and advisory services to assist firms in finding the appropriate licensee.
On 25 November, we are conducting with Licensing for Accountants a 4 hour webcast to address the issues and help accountants develop their plan for 1 July 2016.
Visit our website to register and find out more: www.smithink.com/event/twilight-webcast