Free advice, without paperwork hassles
By George Liondis
FINANCIAL planners who give advice to clients without taking a fee would be excused from rigorous disclosure requirements, including having to supply statements of advice, under a plan that has been outlined to the corporate regulator.
The move would give advisers greater incentive to provide advice on a charitable basis, but could also be extended to cover instances where planners give one-off, basic advice to incidental clients without charge, according to the architects of the proposal, CPA Australia.
The plan was discussed at a recent meeting between CPA Australia and the Australian Securities and Investments Commission (ASIC).
While the idea still needed to be fleshed out, it was met receptively by ASIC, according to CPA Australia financial planning policy adviser Kathy Bowler.
The accountancy body is now producing a discussion paper on the idea, which it hopes to submit for formal consideration by the regulator.
“The general concept is for pro-rata type work to continue without triggering disclosure requirements,” Bowler said.
News of the plan comes a week after CPA Australia released new survey findings, which suggested that the quality of financial planning advice is on the upturn.
More than a third of 820 people surveyed, who had received advice for two or more years, felt the quality of advice issued by financial planners had improved since the introduction of the Financial Services Reform Act.
“… I think the broad-brush bashing of the industry isn’t necessarily warranted because these results are showing there is a general improvement in financial advice,” Bowler said.
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