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Michael Sill
Michael Sill, Mentor Education

Fracas Between Accountants and Financial Planners Overplayed According To Whitepaper

4 August 2016
The supposed turf war between accountants and financial advisers is nothing more than a beat up.

While accountants haven’t exactly been applying for a limited AFSL in droves, a new white paper downplays the rivalry between accountants and planners and explores the opportunities for both groups.

Since 30 June it has become compulsory for all accountants who wish to continue to provide SMSF advice to their clients to have applied for a limited AFS licence as mandated by ASIC.

The Financial Review in February 2016 reported that the number of accountants in Australia in 2016 is 88,000, the estimated number of practices that require a licensee is 8,500, the number of applications that ASIC received for limited AFSL’s was only 350, and the number of limited AFSL’s approved is 90.

What does this tell us? A number of things according to Certainty Advice Group’s new white paper Crossing the Divide: Financial advisory, accounting and the SMSF opportunity. Among other things, the supposed rivalry or turf war between accountants and financial advisers is nothing more than a beat up and reflects more about learning a new language rather than resistance.

Jim Stackpool, Managing Director of Certainty Advice Group, believes that the reason being is that, “the industry experts got it wrong.” Stackpool says that the media and experts were, “expecting thousands more than the few hundred accounting firms that applied for their own financial services license in advance of the June 30 exemption cut-off date. Why? He believes, “the advice is “different.”

While some accountants have simply ignored the exemption date, some remain apathetic and will continue to operate until there is some disciplinary action by the corporate regulator.

Travis Martin Director of Wealth Monument Advisory Services, and partner with The Wealth Designers (TWD) is not surprised by the lack of expediency with which accountants have taken up AFSLs.

Martin rejects the notion that there is a dispute between advisers and accountants and believes the breakdown stems more from, “issues of conflicted advice models inherent in vertically-integrated operations,” which he believes, “have damaged financial advisers’ reputation”.

Scott Farmer, principal of Bravium Financial Planning, believes accountants aren’t thinking about planners and is adamant that, “they will never do anything to endanger their trusted role, so logically they will focus on their accounting expertise.”

While Annette Pulbrook from FinBiz Advisers says that any disputes were “mainly between the financial product-based firms whose future is being commoditised. Pulbrook believes that “those financial planning or accounting firms fighting over the same clients are destined for a frustrating future” and will be overwhelmed, “if they really believe their competition is one another”. Rather, she concedes, their biggest competition is, “their mindset and old advice habits which will just keep them busy but less productive every year.”

Jeff Thurecht of Evalesco of Certainty Advice firm believes that those with a common goal and mindset will excel and says that, “we accountants that get it, we both talk a common language, we have extensive experience who have similar complexities, aspirations and fears, which, though lots of work, makes it enjoyable and fruitful for all involved”.

Stackpool hopes that the white paper will help greater collaboration between accounting and financial advice professionals and encourage a client-oriented rather than change-oriented environment.

Stackpool says that their objective is to explore future approaches to best merge professional expertise, proven old ways and the new and reiterated the importance of “working together for the good of our clients”.

Incidentally, the corporate regulator has warned accountants who are applying for a limited or a full AFSL to expect the application process to be “longer than usual” as it received 38 per cent of limited AFSL applications in the last month of the transitional period between 1 July 2013 and 30 June 2016.

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