War of words between accountants and planners out of date
The turf-war of words between financial planners and accountants is long over and both sides should realise that cohabitation and co-operation are the hallmarks of the future for both professions, according to Radar Results principal John Birt.
Birt said the 'war’ was being waged in the media as the two groups looked to work with clients by offering services typically provided by each other - but the conflict was driven by perceptions of the capabilities of each group.
“With some financial planners looking to provide taxation advice and needing to undertake further education to qualify themselves to do so, some media reports reveal a rift developing between these two professions,” Birt said.
“Since the early '80s, financial planners have always been 'looked down on’ by accountants. Some accountants have, in the past, believed that their clients were poorly advised by certain life-insurance agents disguised as financial planners.”
However Birt said these were out-dated stereotypes and reflected an industry from the past and not one working in the present.
“In isolated instances this may have been true but it was almost 30 years ago and at the time the financial planning industry was in a very poor state. Commissions didn’t need to be declared and financial planning qualifications were at the least minimal, or just didn’t exist. The financial planning industry has come a long way since then,” Birt said.
Birt said the two professions would need to work side by side as accountants were only beginning their move into financial planning. He said that over the next decade many in the accounting profession would take over and merge with financial planning practices.
However this movement would be two-way, with planners acquiring accounting practices that have always operated under fee-for-advice models and so have been unaffected by the grandfathering provisions of the Future of Financial Advice reforms.
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