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The new educational requirements set out by FASEA will likely see a rise in business models offering white-label financial planning services to accounting firms, says one consultant.
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Financial planning partnerships set to flourish post-FASEA
19 December 2018
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7 minute read
With further study required by 2024 for accountants looking to provide financial advice, Smithink director David Smith believes accountants face an “onerous task” to remain compliant.
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To overcome this hurdle, Mr Smith believes there will soon be an uptick in financial planning businesses that will look to partner with accounting firms under a shared revenue base.
“It achieves an opportunity for the accountant to provide a broad-based service that’s all under their brand and that the planner appears for all intents and purposes to be a colleague of the accounting partner and it satisfies all the needs of the accounting firm without requiring them to actually go through and provide the services and have to have all the compliance burden that a financial planning business requires,” Mr Smith told Accountants Daily.
“All the accountant needs to do is be involved in getting the client to want to have the services and then the planners then provide the services under the brand of the accounting firm and there is revenue shared.”
Mr Smith believes the business model is different from a referral programme because it stills gives the accountant full overview of the advice being provided.
“The difference to a referral program is that it is all done under the brand of the accounting firm so from a client's perspective it is the accounting firm providing the service. A referral programme is essentially sending the client down [the] road to somebody else and you don’t really have a lot of control over the services that are being provided,” said Mr Smith
“This is more of a partnership model where the accountant stays involved and is fully aware and engaged in the services being provided to the client
“The accounting firm has full access to the planning and at any time can see exactly what is happening with the client and the services [that] is being provided. It is a much more engaged model for the accounting firm to work hand-in-hand rather than just pushing the client to say go see the planner down the road,” he added.
“There are only a handful providing these services at the moment but I think we will find over time that people will try and develop these different ways to help accounting firms provide financial planning services.”
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