Accounting associations could face rural exodus
Accountant/financial planners in rural areas are likely to forgo their professional accounting body membership if the APES 230 standards are introduced, according to Kenyon Partners chief executive Paul Tynan.
The APES 230 standards have been drawn up by the Accounting Professional and Ethical Standards Board, and will apply to members of CPA Australia, the Institute of Chartered Accountants in Australia (ICA) and the Institute of Public Accountants (IPA).
Under the standards, accountants will not be allowed to charge asset-based fees or accept third-party payments such as insurance commissions. Nearly all soft-dollar payments will also be banned.
According to Tynan, "no one is going to service regional Australia" if such stringent standards are applied to accountants, "because in regional Australia your financial planner, your accountant and your mortgage broker are all [the same person]".
Mortgage brokers usually charge clients asset-based fees, and the financial planning and accounting sections of the business of a rural planner would likely be remunerated in a similar manner, said Tynan.
As a result, practitioners in rural areas will simply cease to become members of the professional accounting bodies that require adherence to the APES 203 standards, said Tynan.
"What do they expect the poor old accountants sitting out in regional Australia to do? They're not just going to wipe off $1 million from their business so they can adhere to the standards. They're just going to say, 'I'm not going to be a CPA anymore'," he said.
IPA chief executive Andrew Conway has stated that his organisation is opposed to the APES 230 standards because they go "beyond the FOFA legislation", and says the IPA would apply its own standards - that align with FOFA - to its members.
AUTHOR
Staff Writer
Recommended for you
A Victorian accounting firm – in which Count holds a 40 per cent equity stake – has announced the acquisition of an accounting client book through a $1.4 million transaction.
Australian Ethical has reported its net profit after tax (NPAT) fell 15% to $9.6 million for the year ended 30 June, while its underlying profit after tax (UPAT) declined 7% compared with the year prior, to $10.3 million.
Insignia Financial has announced a 59% increase in its underlying net profit after tax (UNPAT) to $234.5 million in FY22.
Having completed their educational qualifications, those advisers who remain in the industry are reporting being “run off their feet” with new clients.
