15 December 2016
Following an Australian Government investigation into financial products and services, reforms were introduced in 2012. The reforms focused on improving the quality of financial advice and ensuring consistent rules applied to those providing financial advice.
New legislation took effect on 1 July 2016 requiring accountants who provide SMSF advice on items such as pensions, contributions, superannuation and SMSFs to provide that advice under an Australian Financial Services Licence (‘licence’). This licence is the same licence that banks and other financial institutions operate under when giving financial product advice to their clients.
If an accountant chose not to be licenced they are now limited to providing factual information only.
AR Advisors could choose to have their own license direct with ASIC or we could become authorized to operate under an already existing license. Due to the onerous requirements of running our own license we decided we would become authorized under an existing license.
AR Advisors chose The SMSF Expert Pty Ltd as our licensee as they are non-aligned and independently owned and specialize in providing support for accountants. We wanted a simple service for our clients that would not compromise our independence. We certainly didn’t want a major financial institution directing how we give advice to you. Our advisers have also taken the opportunity to become CA SMSF Specialists with Chartered Accountants Australia/New Zealand (CAANZ) which recognizes our leadership in the field. 2.
With the changes in licencing, accountants providing these services need to follow a more structured and processed approach. You will notice some slight changes in the way we advise you now as we adhere to the strict requirements of licencing.
With new SMSF reforms recently passing though Parliament and receiving Royal Assent it is an important time to seek advice about the changes. Please contact AR Advisors if you would like advice on how these changes affect your SMSF.
- According to Investment Trends 2016 SMSF Accountant Report and other sources, only 5,500 out of approximately 27,000 accountants in Australia had either obtained a limited licence or become authorized representatives of a licensee by 1 July 2016.
- According to CAANZ website, AR advisors have 4 of the 34 specialists in WA who have achieved this status.
