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A director of a national accounting and advisory firm says accountants will face “huge dramas” as they struggle to cope with the compliance of financial services.
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Accountants have ‘heads in the sand’ on licensing
03 November 2014
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9 minute read
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Speaking to AccountantsDaily, William Buck director, business advisory, superannuation Anna Carrabs, said accountants who fail to gain an AFSL or converge with a licensed group will be handicapped.
“It will really limit what conversations they can have and they are going to struggle,” Ms Carrabs said.
“I think a lot of people are burying their heads in the sand,” she said.
“It is only 18 months away and a lot of people haven’t sat down and wondered how they’re going to deal with it.”
Ms Carrabs said those accountants that do not have a plan of action come 1 July 2016 will have “huge dramas”.
“The reality is that we have been in this world of accountants’ exemption, and there is still a murky world that will exist until 2016,” she said. “But after that there will be total clarity.
“All those people that are having the conversations and pretending they’re not, there is going to be dramas for them.”
Accountants have three options if they wish to continue providing SMSF advice: obtain a limited AFS licence, obtain a full licence or become an authorised representative of a licensed group.
Ms Carrabs expects to see flood of accountants looking to join dealer groups as the limited licencing exemption date approaches and ASIC begins targeting unlicensed practitioners.
“But do you really want to leave it until that point in time? Do you want to leave it to a time when you are putting at risk your practice, your business, and putting your clients at risk? I don’t think so.”
The biggest challenge for accountants will be entering the unfamiliar world of compliance, she said.
“Whatever route you choose, whether it’s limited licensing, a full licence or an AR, the world of financial services is all about compliance and keeping records. It’s very pedantic.
“I’ve operated under that world. To be honest, I think very few accountants could be bothered or understand the detail that’s required.”
Ms Carrabs warned accountants that they “can’t take short cuts” with compliance.
“All those people who have been having these conversations but haven’t charged for them, they are now going to have to tell their clients that the world has changed,” she said.
“It will be a huge disruption.”
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