Limited licence accountants disadvantaged by FASEA

18 December 2018

The Financial Adviser Standards and Ethics Authority (FASEA) has effectively given accountants only until the end of this year to consider applying for a limited licence or authorised representative (AR) status, according to SMSF Association chief executive, John Maroney.

The Association has used its submission responding to the FASEA draft legislation to complain that the educational standards, as outlined, have failed to “appropriately recognise or account for” the limited licence advice regime, particularly for accountants with a licence providing SMSF advice.

“We believe the education standards that advisers with a limited licence must comply with should adequately represent the advice that they provide on a day-to-day basis,” Maroney said. “It’s likely the standards will discourage most professionals who are intending to add financial advice to their services and, to a lesser extent, advisers who currently provide limited financial services, from meeting FASEA’s standards and providing advice.”

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He claimed FASEA’s disregard for a legislated section of the financial advice framework appeared to contradict its goal of setting educational, training and ethical standards for all financial advisers who provided personal advice on relevant financial products to retail clients.

Maroney noted that, in its submission, the Association had proposed that a specific limited licence adviser pathway be created that provided a more appropriate framework for FASEA-related units individuals must undertake in a specialised area of limited advice.

It suggested that the framework would also provide the capacity to include and recognise the different Recognition of Prior Learning (RPL) that was relevant to limited licence advisers in circumstances where, currently, the standards are more likely to require a limited licence adviser to complete more courses than a full licence adviser.

Maroney said the association also intended to lodge an official application for the Specialist SMSF Adviser (SSA) accreditation to be recognised as professional designation education. 

“If accredited by FASEA, we propose that existing advisers will be eligible for RPL where they have completed the SSA, acknowledging that it demonstrates the highest level of SMSF knowledge.”

“We believe that RPL credit should still be awarded for current informal learning, experience and ongoing continuing professional development, most significantly to those advisers who have 10 years’ experience in providing retail advice and have documented ongoing CPD over that period,” the submission said.

The submission also asks FASEA for clarity surrounding relevant degrees, specifically relating to aggregating courses over several qualifications and including superannuation, retirement and insurance as relevant degree subjects. 

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This looks like some of these so called "professional accountants" are running a little bit scared thaht they might fail the ethics component of the exam because they are sure how to answer a client comes in with basic knowledge is it appropriate to set up a smsf? or a client comes in with $100,000 in super and says I might but a property one day should you set up a smsf? In case you are wondering the answer is no, stop inappropriately setting up SMSF when a wrap will do the same thing without lining your own pockets PS im sicking of winding up inappropriate SMSF

Everyone gets the same advice, everyone gets the same performance, everyone gets a basic living winner - Everyone a winner. Where is the approach that if you worked hard, and you got to where you are, whether knowledge education and experience you had an opportunity? Now we eliminate the experience of older groups. If one occupation such as financial planners need to have their roles, tasks etc restructured. Then lets bring in this qualification for all? Why does a politician not need to do further qualifications on ethics, the knowledge that they gained 20-25 years ago now obsolete? All politicians need to go back to uni? Wait - how about Trustees - let's send them back to uni, their experience does not count - go back to uni - same exam as planners - and there is more - how about the lawyers - back to uni. maybe this is beginning to look like a cull get everyone out just before a redevelopment of a system - how about nationalised superannuation?

Everyone is disadvantaged by FASEA other than the universtites providing the courses and the financial institutions who will benefit from the removal of advisers enhancing their ability to seel their junk direct to the public without having to satisfy the best interests duty.l

*Doing an ethics course does not make someone ethical.

Older advisers who have been doing thier job for 10+ years have nothing to learn from going back to uni and will retire which will result in a shortage of advisers, driving up the cost of advoice and pushing even more clients to the unregulated and poorly trained sales sharks at the wealth/insurance companies operating under general advice.

If you ask anyone who they would rather be dealing with, a high achieving university graduate with the bachelor orcfinancial planning with one years experience, or an older adviser with 15 years experience and an internationally recognised qualification (CFP).

Once again (just like with LIF) it will be the clients who lose when they find they have no avenue for recourse when their investments/insurances turn pear shaped because the government removed their access to financial advice.

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