Powered by MOMENTUM MEDIA
Powered by MOMENTUM MEDIA

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

Accountants losing in regulatory fight, lawyer claims

Recent regulatory reform has seen accountants lose ground to financial advisers, according to one industry lawyer.

News Miranda Brownlee 11 September 2015
— 1 minute read

Speaking at a Sydney event, DBA Lawyers director Daniel Butler said an increasing number of financial planners are becoming registered to provide tax advice as ‘registered tax (financial) advisers’.

Advertisement
Advertisement

“That registration may not be a full-blown tax registration but they can talk about tax,” said Mr Butler.

“Some of them are now providing more compliance solutions in their financial planning practices – if you are referring clients to financial advisers you may want to check out the extent of their service.”

On the other hand, he said, accountants who provide traditional accounting services without an AFSL in areas such as business planning or the establishment of a company will need to provide evidence that proves the advice provided did not extend beyond the scope of these traditional services.

“That’s the regulation, and that’s why I’ve come to the conclusion generally that the planning community has won the turf warfare,” said Mr Butler.

“[Accountants] are on an island and have to justify their existence to give advice in traditional accounting services and again, this is where I’m saying the law hasn’t done you justice here if you are a mere accountant.”

Those accountants who plan to operate without an AFSL after 30 June 2016 are at risk if they stray off course. Therefore, they need to minimise their risk by ensuring all information about them that is available publicly indicates consistently that they have no licence nor do they provide financial planning advice, said Mr Butler.

He also recommended they provide appropriate disclaimers in written communications; clearly define scopes of engagements; file notes and confirmations of scope and disclaimers; and ensure there are no commissions or trail fees from financial planners.

While ASIC is unlikely to increase auditing in this area, Mr Butler said accountants face the risk of being sued by their clients if they provide advice that they are not authorised to provide.

“That’s what’s going to keep you honest – your clients or a competitor. If a competitor down the road finds out you’re giving this advice they’ll say, 'hey ASIC, look at this guy' and blow the whistle,” he said.

“The trouble is that as a professional you have to be not only clean but you have to look clean, so as a professional we generally have to be beyond reproach.”

Accountants losing in regulatory fight, lawyer claims
image intro
accountantsdaily logo
News
FROM THE WEB