The accounting industry has been going through a transition period since the removal of the accountants’ licensing exemption. Traditional accountants specialising in tax and compliance are developing an appetite for both business and wealth advisory services, with many looking for ways to diversify their service offering.
With the new Australian financial services licensing regime for accountants comes new opportunities. It’s important that accountants are reflecting at a strategic level about whether licensing is appropriate for them and their firm.
For those who have gone down the path of obtaining an Australian Financial Services Licence (AFSL) in order to provide financial advice, they are now getting first-hand experience of the complexities of the end to end advice process.
It may be that accountants see obtaining an AFSL as a solution to providing financial advice to their clients, but they should be aware that it is not the only option to operate in the advice space. Whether an accountant is already licenced, or considering it, they should assess whether licensing is appropriate for their business model.
To better understand their options, accountants may need to profile their own firm. Self-assessment will allow them to gain a deeper level of clarity on their clients and a better understanding of their needs. It’s important to understand elements such as the number of Self-Managed Super Fund (SMSF) clients, and the percentage of their client base that has an existing financial advice relationship.
If licensing isn’t an option, they could consider exploring joint venture relationships with financial advisers. According to an Investment Trends report, 88% of SMSF accountants already have referral arrangements with an adviser1. This collaboration of the accountant and financial adviser can provide a holistic service offering for their client base and allow them to deliver a comprehensive service to their mutual clients.
One of the drivers of success for firms is identifying the opportunity for accountants and advisers to work together. Multi-disciplinary practices are becoming more commonplace, with 56% of accountants saying their firm employs someone who is licensed to provide financial planning advice1. Merging the strengths of accountants and financial advisers can complement existing client value propositions and provide an enhanced service offering.
The focus should always be on the end client and ensuring that there is no compromise on the service offered by their trusted advisers. This means for some practices that the engagement between accountant and client may continue to shift and evolve beyond tax and compliance to holistic wealth advisory.
BT Panorama has a number of solutions to help accountants. To find out more visit btpanorama.com.au/accountants
1. Investment Trends 2017 SMSF Accountant Report, based on a survey of 1,248 accountants in public practice.