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While licensed accountants are completing the fact-finding or questioning process with clients in an effective and thorough manner, many are still failing to record adequate notes of this information, according to an industry consultant.
Mayflower Consulting director Sarah Penn said the main compliance issue for licensed accountants continues to be the substantiation of the basis of advice, and ability to demonstrate that they have all of the relevant information.
“It’s mainly the recording of the questioning process. I’m sure accountants are asking excellent questions, but they need to be all written down,” she said.
“To do that you need to have fact-find documents, and they’re often 30 to 50 pages in length. They’re long and they’re boring, but that’s how you demonstrate to ASIC that you have made all the right efforts to know your client properly in order to be able to give them personalised advice.”
Ms Penn said she continues to see a complete underestimation of what ASIC expects from licensees, with many accountants still finding the process of completing compliance paperwork highly unnatural.
“This is the way ASIC operates; evidence is everything, and unless you can substantiate that you’ve got fact-finds, statements of advice [and] compliance plans in place, you are going to be in a great deal of trouble when ASIC comes knocking,” she said.
“ASIC has been very clear that they are going to go and find some people who are doing the wrong thing and make an example out of them.”
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