CPA Australia has today launched a green paper to hear members’ views on the current regulatory environment and whether it is effective and efficient for both the profession and consumers.
A survey will be open to CPA members from today to 1 June 2019, with the professional body set to release its findings by the third quarter of this year.
“The accounting profession is faced with ever-increasing regulation and compliance over the past decade, resulting in increased costs and time burdens in providing services to clients,” CPA head of external affairs Paul Drum told Accountants Daily.
“Further, the recent Hayne Royal Commission into the Banking, Superannuation and Financial Services Industry has shone a bright light on financial advice and consumers. It is expected that the report recommendations will lead to further regulation and compliance obligations on sectors that are already subject to significant compliance costs and burdens.
“[Ever-increasing compliance burden and costs] have created barrier for both new entrants into the accounting profession, but also for professional accountants considering whether to expand their public practices into financial advisory services.
“Given the fundamental need for consumers to have access to independent advisory services in a complex investment world, this is not in the greater public interest.”
The paper will examine issues surrounding tax agent services, traditional accounting services, financial planning advisory services and credit advisory services.
It notes how current regulation often overlooks existing obligations and results in duplication and increased obligations.
“For example, the definition of tax agent service in the Tax Agent Services Act 2009 was amended to capture the tax consequences of financial product advice provided by financial advisers. This resulted in financial advisers being required to register as a tax financial adviser (TFA) with the Tax Practitioners Board (TPB),” the paper said.
“If the financial adviser is authorised to provide the advice under a Corporate Authorised Representative (CAR) structure, they must also register the CAR as a TFA. Where the financial adviser is a professional accountant, it is common for their practice to also be registered as a company tax agent.
“That is, three registrations are needed to provide professional tax agent services to clients.”
The paper will also consider the impact of ASIC’s industry funding model on the market, especially smaller practices, and how it could encourage market concentration.
“This important body of work will help to build a policy platform to identify the changes needed to address the growing issues of complexity, inefficiencies and costs in our current regulatory framework, and encourage the provision of affordable, independent quality advice by professionals,” Mr Drum said.
“Importantly, it also seeks to engage, inform and protect the client in the process.”
Jotham Lian is the news editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.