The convergence of financial planning and accounting practices is inevitable as revenues and profit margins of both business models are being squeezed, according to the Institute of Public Accountants (IPA) and Australian Wealth Solutions (AWS).
AWS said the firm was on its way to position the business as a complementary financial planning service provider to support accounting practices and recently hired financial planner Sam Koranias who would be responsible for a new digital marketing program.
According to AWS’ founder and principal, Sam Zervides financial planning advice would be a “naturally complementary service for accounting firms” however there were still many firms reluctant to embrace the potential.
“The accountants caught in an inertia trap and don’t merge or align with a planning practice – or engage an inhouse financial planning practitioner – will find their revenue stream dwindle into insignificance over the coming years,” he said.
“There is enormous potential and value to be unlocked for accountants working with planners including the retention of clients and long-term financial sustainability and growth.”
Also, the end of the accountant’s exemption on July 1, 2016 represented a major shift forward between the two professions with accountants acknowledging their duty of care to clients and referring them to a skilled financial planner.
According to AWS, this practice and momentum was going to increase.