Will FASEA rules make intra-fund, scaled advice unviable?

Intra-fund advice, scaled advice and limited licensing for accountants advising on self-managed superannuation funds (SMSFs) are all at risk of losing viability under regulatory and legislative reforms such as the Financial Adviser Standards and Ethics Authority (FASEA) regime and those likely to flow from the Royal Commission.

That is the assessment of wealthdigital advice portal technical manager, Rob Lavery, who said there was a danger that the upcoming changes would place advice out of the reach of many by restricting it to those who could afford to pay thousands of dollars in comprehensive advice fees.

“Of itself, greater regulation is not a bad thing if it achieves better outcomes for consumers,” Lavery said. “It is important, however, not to lose sight of the importance of consumers having access to financial advice.”

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“Intra-fund advice, scaled advice and limited licensing for those advising on SMSFs are all at risk of losing their viability under the incoming reforms,” he said.

Lavery pointed out that under the changes to the Corporations Act that passed parliament in February this year, there currently existed no dispensation for those providing intra-fund advice.

“This means that, in order to provide advice to a client that is specific to their current super fund, an adviser will need to have a degree qualification, pass a three to four-hour exam, do 50 hours of CPD a year, and new advisers will need to spend a year being mentored and supervised before they can provide advice independently,” he said.
Lavery said it was fair to wonder why an adviser would opt for an intra-fund advice role given the significant investment of time and money they would need to make to be able to provide advice.

“What’s more, will super funds be willing to wear the cost of employing any more than the minimum number of necessary intra-fund advisers? New advisers will be even more expensive as they are effectively unable to do their job for a year,” he said.
“Those currently providing advice under a limited licence face the same issues as those providing intra-fund advice, in that all the FASEA-administered changes will apply to them. This means that accountants using limited licences who wish to continue advising clients on their SMSFs will need to undertake a significant amount of further education and training, on top of their normal accounting requirements.”
Lavery said he believed such requirements might act as a disincentive to those operating under a limited licence.

“They may decide the new requirements simply aren’t worth the additional time and cost. This will leave many clients without any guidance when it comes to their SMSF,” he said.
“Specialists are also likely to feel the pinch. Under the current rules, advisers need only be trained and maintain knowledge in the specific areas they advise on, such as insurance, superannuation and managed funds. None of FASEA’s guidance to date has indicated that a similar, specialities-based training program will be in place,” Lavery claimed.


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Well Boo Boo...that's another fine mess you have gotten us into..

I think that people deserve the highest standard and we can't allow "loop holes" to undermine the integrity and client protection that these regulations are designed to protect.

No carve outs , we need a level playing field here. Not fair for us to have to do these 3 units in bridging courses if the accountant can still flog smsf without needing to follow the same educational path to "professionalism", why are they such a protected species?.

Financial Planners you are a disgrace
No wonder you are not regarded as professionals
Accountants = professional
Financial Planners = unprofessional and incompetent
For a start accountants must complete comprehensive education standard like a university degree
Planners can do a 2 week diploma course by correspondence
Financial Planners can not be trusted
just see with all the scandals, frauds and royal commission. No wonder financial planners are not trusted while accountants are held in great esteem
You planners need to get our approval from your clients before the client will even consider what you have to offer. We hold the keys. We are trusted and you are not. Give Financial Planning to Accountants.
We will make it into a profession like Accounting
As long as Financial Planning is provided by financial planners the public will have no trust in planning. It needs to be done by true professionals Accountants
We do taxation which is very complicated compared to simplistic financial planning
Accountants are the answer to give financial planning industry integrity and professionalism so stop whinging financial planners

CPA Advice - cue music -

You are no doubt so good at accounting, why would you also want to do financial planning?
It would force a change of thought process and getting away from numbers.
Hope you are up to it

To reply to this nut job I'd say Accountants would also have to give out consumer protection documents like SoA's etc, putting their advice in writing. Currently it's would you like a SMSF and Chocolate Shake, Fries and some Bank shares with that compulsory Tax Return. And so that is never going to happen. I've always found the best outcome for the client, occurs when professionals are on the same page. I know my limitations, I think the clients of this person are heading straight to Centrelink do not pass go.

Anne, I have followed your many comments in money management. You are the reason why financial planning is not regarded as a profession. You are the cause of public having no confidence in financial planning. In another post on money management you are anti church and resort to verbal abuse like called people scum and nut job. Is there anyone you like? Your comments trying to explain things reflect your ignorance and lack of basic knowledge. We should treat your comments like what they are garbage and like a toddler seeking any form of attention.
From your comments so far in money management I do not think you will be able to pass financial planning test so the industry will be freed from your toxic form of advice. You are unable to provide a calm and rational discussion on this forum. I would hate to think what you say to your clients. I guess in your soa presentation your standard line is Scum sign letter of engagement and you would be a nut job not to understand what I have told you. Anne you have no concept of working in clients best interest, you only work in your own interest. If your comments reflect your thought process your clients would never receive a rational solution as your are totally incapable of logical stable thought with basic reasoning skills as you are so mentally unstable and of such limited intelligence that you resort to verbal abuse. Anne you need psychological help. I disagree you know your limitations as you talk complete nonsense constantly in money management forums. My clients are very happy and get a professional providing non conflicted advice something you can not say. The only person going to centrelink queue is you Anne. You will be there soon. You talk about professionals being on the same page but you are not a professional so why comment on something that you will never have the intelligence to do so.
Once your clients are investigated you will be found to be what you are a person lining your own pockets at of your clients expense and clients fear of your verbal abuse. You talk big here Anne but I doubt you are even capable of lodging a business activity statement. Your ignorance, lack of ethics, emotional and verbal abuse and lack of professionalism drives me to provide a professional ethical alternative to the crimes you commit in the name of clients and financial planning. If the rest of financial planners are like you Anne it should not be long before you are relegated to the dustbin of history and financial planning being done by the real professionals Accountants not planner wannabes like you Anne

I am disappointed in the editorial team for allowing the personal attacks of the above individual (Accountant CPA) to be recorded here.

I am a senior participant in the industry and have never commented in the 20 years of observation before - but this draws me out.

I also have nothing to do with Anne but I cannot stand by and watch the personal trolling by someone who is not prepared to identify themselves.

My comment is not to either of them but to you MM. Please MM you must not allow or enable trolling like this on your forum lest you become wholly irrelevant as a media source.

Money Management should be congratulated for allowing free speech
Don't shoot the messenger if you do not like the message
Professionalism it appears you support fake media instead of free and open reporting of Money Management
Professionalism it is a pity you go after Accountant CPA and Money Management and let Anne off the hook even though she has posted numerous bigoted and verbal abusive comments.
It is a bit rich and hypocritical of Professionalism to make an issue about Accountant CPA not giving their name when Professionalism does not give their name.
Anne stop hiding behind your husband using the alias Professionalism
How much lower can you go Anne?

I'm pretty confident a lot of Australians would support my argument that Financial Planning needs to change. What are YOU doing to prevent FoFA and FASEA version 2 ? No doubt like most planners NOTHING, just sitting back and paying those FPA member fees every year, not even questioning the relationship they have with product providers, paying those licensee fees to a bank owned licensee. Self Regulation and Accountability in the Financial Planning industry is non existent hence why the Government is just going to keep on keeping on, meanwhile practice values keep on going South. I suspect most people that are against my comments are Compliance staff or work in Senior Management in a bank owned licensee.

This is hilarious - Real Professionals and Accountants ought never be uttered in the same breath! I can go and do a tax agents course and set up shop flogging i-returns in a heartbeat. I've been in the industry for over 20 years and I've come across 4 good accountants that know what they're doing. The rest of them I've had to explain basic concepts like breaching the sole purpose test, arms length transactions and fiduciary duty to. The last one I dealt with said "I'd really like you tune these 4 directors up for an SMSF, I'm trying to grow my base a bit in that space."

Spare me.

A good, qualified and professional Fin Planner knows 10x more about their clients than an accountant can ever hope to know. I can tell you the last time my clients had a medical check up, what their children are doing at uni and so on. In fact, I've taken about 20 clients away from useless accountants in the past who think their clients love them, only to realise they hate them and were too embarrassed to move.

If anything I'd be worried if I was an accountant, with all these young planners going back and doing post grad Finance and Accounting degrees, you guys will come under enormous threat from talented, professionals that have one thing most accountants can only dream of - a personality.

Felix it is a fact that Accountants are regarded by Australian public as a more trusted occupation then Financial Planning. Australian public does not trust Financial Planners
Financial Planning is not even regarded as being profession. Have you ever wondered why? Financial planning schedules, royal commissions ... need we say more.You talk about a good financial planner but this is as mythical as unicorns and fairies. It is a fact Accountants are held in higher regard with their clients then Financial Planners. This is why financial planning clients always ask the opinion and approval from their accountants when approached by financial planners. This is the facts on the ground now. It is us Accountants whom hold the keys not financial planners. You hear constantly in the media about Financial Planning scandals and not accountant scandals. Claiming to have completed qualifications in both financial planning and accounting did you find how simplistic financial planning is. A good accountant knows everything about their clients. Substantially more than a financial planner. It is interesting that you claim to have taken substantial business off accountants whilst smsfs share of market keeps growing so there seems to be a disconnect with reality. I believe you have got confused the facts from your Accounting business and Financial Planning part. All my smsf clients in residential property have had substantially greater growth in their investments then financial planners I have seen so far. The basic intelligent benchmark is to lodge a Business Activity Statement. I am yet to meet a Financial Planner who can lodge a Business Activity Statement - so much for being more intelligent. Felix as a fellow accountant stick to Accounting and you will see over the next 5 years that financial planners will become irrelevant and Accountants will be doing financial planning and financial planners will be just a memory. Stay focused Felix and be patient. First step is carve outs and as public has no trust in Financial Planners it will go to the real professionals with the public blessing to the ACCOUNTANTS.
It is amusing that you believe that the so called Millennials will make any positive contribution to financial planning. They never stick to anything, demand top dollar and churn out substandard work, blame everyone else for their laziness and their bitterness to society because they waste their money on smashed avocado instead of making without to progress. These so called Millennials very rarely can hold down a financial planning job for 12 months. Save your money - you would get better satisfaction burning your money.
Simply this
Accountants = good, honest, professional, work in clients best interest
Financial Planner = dishonest, act in self interest, fraud, not professional
Do the right thing see the real professionals ACCOUNTANTS

I don't know why I'm bothering to hit reply here, but your delusion has my undivided attention. I can send you email after email of accountants that have been put into prison for misappropriating client funds, fraudulently claiming clients' tax return fees as their own, incorrect trust account management, the list goes on and on, here is a recent example for you:


Yep, pillars of society you are.

The issue is that there is a wide range of people who call themselves Financial Planners, as there are people who call themselves accountants. I'd back my knowledge any day of the week over the local chump churning out tax returns in a shopping centre. Me vs. the senior tax partner at a big 4 firm? Not a chance, but they are specialised and I refer my clients to them gladly.

I the flip side I know that person cannot tell you what a sharpe ratio is, let alone analyse the underlying risk of the investments in my client's portfolio, but I sure as hell can, that's what my degree taught me.

You think I'm referring to Millenials when it comes to education standards? I'm afraid you're severely mistaken - these are highly qualified mid 30-early 50's investment professionals that are about to take your industry and turn it on its head. There is a reason things like Xerocon and Practice Ignition flog "Advisory" as the saviour, because they know that the days of compliance work are done, your industry has been disrupted in ways that the standard accountant does not yet fathom. If you're still running timesheet billing, you'll be redundant in 5 years, move to fixed fee and back yourself, stop charging clients to have your undergraduates photocopy. Here's a fun fact for you, 1/3rd of your client base hate you, that's the attrition rate of clients leaving accounting firms being sold these days, they just couldn't be bothered telling you that.

As for submitting the BAS? I pay a bookkeeper and Xero to do 99% of the work, the standard accountant just rubber stamps it and uses incorrect, poorly compiled workpapers to submit it.

And while I'm here, stop flogging SMSF's to your clients to buy residential property, there is a huge liquidity risk if it's the sole asset, which I'm going to bank in your case it is. Step aside and let an investment professional do what they do best.

I'll sign off by saying you know what your clients want you to know about their business and cashflow. We know what clients don't want anyone else to know about their health, their lives, their will, their estate planning, their illegitimate child we have provided for in their risk strategy and their dream to visit the lavender farms in the Cotes du Rhone in retirement.

Thanks for playing, but we'll take it from here.

You're entitled to your opinion and frankly....it was a great laugh. I have only a couple things to say in response to your dribble. FoFa, Royal Commission, Four corners stories, LIF, over bearing red tape, over bearing compliance, an inability for all Australians to seek advice and resort to industry super funds via a call centre and last but not least an inability to claim advice as a tax deduction. If I've insulted you then you need to have a good hard look at yourself my friend. The lines of professionalism have been drawn and advisers need to be accountable for their own actions. You Sir are clearly on the wrong side of it. I've spent 20 years being professional, but the days of being professional in these public forums are over. I stand by my comments calling Certain institutionally aligned advisers the Scum of the advice profession. Seems like I upset you so maybe crawl back to your broke, subsidised bank owned licensee that told you that you're a free agent. Yeah right.. As far as passing the FoFA exam. We'll that's funny as I'll be writing part of it. If I've made other advisers think about what professionalism means then good for me. I welcome any comments on professionalism any time.

Anne you seem very angry. What happened? woke up on the wrong side of the bed?
Why you call fellow advisers Scum because they work for a bank?
Are you not all planners.
You should be working together to restore confidence in the industry so the industry can flourish
Together you stand divided we all loose. Stop being selfish Anne and help the industry that has given you so much. You are a divisive figure instead of a healing one. You have been in the industry for 20 years you should know better
All fellow planners I do not believe such a bitter person Anne should be part of setting questions for exams as I believe she is so twisted she will write questions to make people fail so she feels good about herself while sending the rest of planning practices south as she helps disable the industry. You are a parasite Anne. The sooner you go the better for all financial planners and the industry

It's good that you've been able to convince yourself you are doing the right thing, that should give you a lot of comfort. If you are such an influencer and as high up as writing the FOFA exam, why are you bothering posting under likely false names on an internet forum? Wouldn't you be too busy discussing these issues at much higher levels. Would a true professional actually bother posting here under a pseudonym?

I've been overwhelmed with support on Linkedin and Twitter. I'd just like to say let's have a look at the current advice landscape. FoFa, LIF, FASEA, Royal Commission, Four Corners Stories, Advice not tax deductible, Government intervention and more Government intervention. Red Tape and over bearing compliance. Australians priced out of seeking advice. Practice values falling, Good planners forced out of the industry. Advice firms that can't even call themselves non-institutionally owned. Professional Associations that are funded from Product Manufacturers and then lodge submissions to Governments. What a mess. Things need to change, advisers need to change it and not be part of the problem. I say control the things we can control and don't worry about anything else. Choice of licensee is within our control and so, as they say are you part of the problem or part of the solution. Great Chatting.

Accountant cpa there is no doubt in my mind that you are actually a paid ISA troll and not an accountant. A professional accountant would not utter such vitriol and nonsense as you have. In addition, you are incorrect is your statement that accountants have to complete a university degree. There are many accountants who have only completed a Diploma of Accounting and operate as tax agents. Look up the requirements on the TPB website. I have an accounting degree and yes tax advice is a complicated profession, however, financial planning is also a complicated profession that requires an even greater level of competency. By 2024, as a minimum, financial planners will have a higher level of education standard than accountants. As a result, financial planning businesses will end up holding the keys and accountants will be forced to come cap in hand to financial planners for work.

You are truly one of those conspiracy theorists
1 ISA does not have trolls. all you have to do is email or call Brett Whitely
2 The earth is not flat
3 Financial Planners act in their clients best interest
You have also have been deceptive with qualifications. An Accountant currently has higher education benchmark then financial planning 2 week online course with Kaplan
If your comments on this forum are a refection of your research and rationale I pity your poor customers
You truly demonstrate the greatest joke of all Financial Planners
No wonder on trust scale of occupations Financial Planners are listed below car salesman and real estate agents

Skeptic its obviously from your rude comment that you are just another socialist troll that spews out vitriol. Australia is in big trouble given that resentful malevolent cretins like you are taking over the nations means of production via the use, and no doubt eventual confiscation, of everyone's superannuation savings. Like all socialists you use force to push competency to the margins and thuggery to the center.

What is going to happen is there will cease to be intra fund advice all together except for the HNW clients. The super providers will offer general limited advice to their clients and the client will be left to their own accord to choose the super/investment/insurance options. The adviser who works under the BID will cease to exist and clients will be left worse off and because advice was general advice there is noone for them to sue when things go wrong.

Plus Accountant CPA you need to come back to reality. How many SMSF's have you set up and placed their assets in 1 investment category (housing with a some cash on the side to pay your fee). Ive had to tell many clients they have been screwed over by their accountant for setting up a SMSF with under $150k in it and borrowed to buy an off the plan house which they cannot rent out.

The only way to fix this industry is to have one set of rules for everyone, EVERYONE selling with ANY financial product, including mortgages/car credit/super/insurance etc. Everyone neds to be qualified and university educated and regulated, otherwise the product providers will settle for the cheaper option of General Advice which can be given after a 30 minute induction program and without any need to act in the client's best interest.

But this will never happen. Its going to be general "sales" advice only going forward and consumers will be left with no recourse when things go wrong.

Anne I am so happy to see you care
I knew down if I could get you look deep inside you have a conscience and care
Lets make a real difference. I propose we provide limited pro-bono service to show Joe public the value of Financial Planning and how it can change lives
Clients have dreams and concerns while we planners help make dreams come true and people have peace of mind. We are professionals. You can say we are money doctors. You have inspired me Anne. I am going to quit working for Suncorp as a branch planner. We should hook up and partner up and conquer the world of advice. With my advice and your AMP Paraplanning experience we will conquer the world of You can do my parraplanning and I will provide the advice.. You have a very impressive parraplanning experience with AMP. I will give you a 10% ownership stake in my new business. I will save you from your AMP commitments and restrictions.
I was looking at establishing in Cabramatta. We could spread the value of advice to the non converted. I assume you have asian language skills as you look asian. Look forward to starting our advice adventure together. Together Anne we are unbeatable. Who else wants to join us? At our opening I will have the dragon in the dragon dance named Anne

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