Accountant limited licence as expensive as AFSL

15 March 2016

While a limited Australian financial services licence in view of the accountants' exemption deadline for advising on self-managed superannuation funds (SMSFs) may seem like a more cost-effective option, the costs will equal those of a full AFSL holder when all the back office, continuing support and professional indemnity considerations are taken into account, warned a wealth management executive warned.

Paradigm Group's chief executive, Bill Danaher, said many accountants would become authorised representatives under an authority holder or opt out altogether.

"It's obvious from the very low number of AFSL applications received by ASIC (Australian Securities and Investments Commission) that many accountants have realised the enormity of the legal, regulatory, operational, resourcing and PI requirements that will be needed," Danaher said.

The comments came as Paradigm launched a bespoke, end-to-end offering to accounting practices that are looking for an outsourced AFSL facility with the delivery of advisory services.

Accountants will receive assistance with the preparation of investment strategy for their clients including asset allocation and insurance as well as back office support, including preparing a statement of advice, and technical support.

However, Paradigm warned it was not a ‘volume' offering and said the accounting practices had to be a cultural and operational fit within Paradigm's business model.

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So basically Accountant's have said "Not worth it, too much compliance in financial planning"...

Having an AFSL is not a boat license where you just rock up to the RTA and off you go. Getting the license is the easy part, it's the meeting all the relevant corporations acts and having all the relevant evidence to prove you've met them. By far the easiest solution and best option is to find a great financial adviser and form a referral relationship, whilst focusing on your key strengths. If you want to add value onto your firm and thinking of getting an AFSL, take a Disprin, lie down and just by some stocks in some financial services companies and go back to focusing on your key strengths.

Yogi, not fully correct mate, the boat licence is a lot harder now, you need 3 practical trips with a experienced skipper too as well as sitting the knowledge test. Re Eds comment below well ill leave that alone as not worth replying to.

Haha.. Referral to a good financial planner? That's a bigger joke than the whole limited fsl saga.

Mr Danaher you left out the 3rd option for accountants. Just keep doing things exactly the same way as before, safe in the knowledge that ASIC is too focused on strangling the life out of financial planners to worry about enforcing the law where accountants are concerned.

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