Will the Professional Bodies Fight for the Continuation of the Accountants’ Exemption?

Will the Professional Bodies Fight for the Continuation of the Accountants’ Exemption?
Anger is arising. July 2016 is a milestone date for many practitioners who don’t already have some form of financial services registration or qualification. From this date, the words ‘self managed superannuation fund’ will become almost impossible for many practitioners to use. To date, there seems to be a couple of alternative approaches. These are:

become licensed in some form (we can assist with this if required)
withdraw from practice
don’t venture into this area of advice in the first place, although this may be a little difficult given the huge growth opportunity that most practitioners perceive this area to be
discontinue offering advice / services in this area
as a result of the previous point, perhaps outsource this work to a colleague or friend
However, we shouldn’t underestimate the time and effort required to obtain a full or limited license, if this is your chosen path to prepare for this change. Current data suggests practices are slow to act in this area with licensing applications relatively limited to date. Of applications received, many have yet to be successful apparently due to holes in the required data. If you prefer the authorised rep approach, that’s fine, but get to it. With less than 18 months remaining until the July 2016 deadline, this legislative change will wait for no man and the general pleas of ‘I haven’t had time’ unlikely to be received well by the powers to be.

Nonetheless, despite my general view that a reversal or delay in the removal of the accountants’ exemption is unlikely to take place, we are starting to hear increased rumblings amongst accounting practitioners regarding the lack of equity for them within this legislative change. Some perceive the removal of this exemption as having been driven by the financial services industry, in particular the big players. Yet, as we learn of another large institution in the bad books for inappropriate advice to clients, the question is raised about how and why such parties should have such significant influence on these changes within the accounting profession. After all, accountants are seen as far more trustworthy than their financial adviser colleagues, so why should such a stringent amendment to legislation (which will have such a significant impact upon who can provide advice within the SMSF space) still be in place particularly given recent demonstrations by key players within the financial services industry around their inability to put their clients’ needs first. It seems contradictory to have a profession, part of which can’t do the right thing by their clients themselves, drive change that will impact upon another profession which has a better record of quality client servicing.

The big question that practitioners have been raising with me is, why aren’t the professional bodies fighting harder? Why didn’t they fight harder to retain this exemption in the first instance? and Why aren’t they putting the ‘powers to be’ under renewed pressure to undo these legislative changes and retain the accountants’ exemption? …. particularly in light of current events within the financial services industry.

Unfortunately many within financial planning talk about improving their image within the market, more professionalism and the like. However, until ongoing revelations regarding various groups acting against their clients best interests’ wane, the market’s perception of increased professionalism within this industry will be slow and accountants remain prime candidates to benefit from such perceptions. Perhaps the various accounting bodies may wish to consider taking up the fight again for their members when it comes to stopping the removal of the accountants’ exemption.