Financial services law firm Sophie Grace has expressed concern that the new licensing regime may tempt accountants to step outside the boundaries of their legal authorisation, warning it is "very difficult" to remain within the scope of a limited AFSL.
Speaking to AccountantsDaily’s sister publication, SMSF Adviser, Sophie Gerber, principal of Sophie Grace, said one of the current pitfalls in the SMSF sector is the ease with which accountants and advisers can provide advice that they are not authorised to give.
“For example, most accountants have a range of clients, all of whom have superannuation. There is the potential in their capacity as an accountant that they step outside of this role and provide financial advice in relation to superannuation,” she said.
“I think what happens is that they’re trying to look after their clients and they either forget, or it’s verbal and it doesn’t get written down, but then it comes back to bite them later if something goes wrong with that particular investment,” she added.
Ms Gerber expressed concern that the risk of unauthorised advice will be heightened when the new licensing regime for accountants officially begins in June next year.
It’s “very difficult” to stay within the scope of a limited AFSL, she said.
“Once you start giving limited advice, people are going to keep coming back to you for more and more advice,” she said.
However, Ms Gerber said she would still encourage SMSF accountants and advisers to seek this new limited AFSL and take advantage of the transition period offered by ASIC.
“For accountants looking after a number of clients with various investments and financial interests, obtaining an AFSL provides a very promising opportunity for them to explore,” Ms Gerber said.
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