The “one-size-fits-all” approach to financial advice has failed and requires urgent reform to simplify the regulations and make it less expensive, said CA ANZ.
Its members are unable to offer the superannuation advice demanded by clients and the answer has been opening the system with more efficient rules, the professional body said in its submission to the Quality of Advice Review.
“The resounding message from our members is that their clients want simple, strategic superannuation advice from their trusted adviser – their accountant,” said CA ANZ advocacy lead Simon Grant.
“We believe there is, and will continue to be, a need for trusted advisers to look after the financial advice needs of everyday Australians.
“It is high time reforms are implemented to ensure advice is less expensive to provide so it is more accessible to all consumers. Advice on simple matters or complex scenarios needs to be able to be provided by suitably qualified professionals in an efficient manner.”
The terms of the QAR, released in March, were criticised by tax and super professionals for not going far enough although lawyer Michelle Levy, who leads the review, said it was a chance to make “it easier for Australians to receive quality advice when they need it and in a form they want”.
As well as its own submission, CA ANZ has joined forces with IPA and SMSFA in a joint document relating specifically to accountants outlining four key areas of advice sought by clients in the ordinary course of dealing with tax agents.
That joint submission has yet to be released along with details of a unified approach by 10 other industry associations “working for the resolution of key issues facing the industry as a whole”.
However, the CA ANZ submission sets out its reasons for reform and offers 10 reasons why chartered accountants “are well placed to reduce the advice gap”.
- Additional financial advice in the community helps individuals and small businesses on the road to recovery.
- Small businesses employ people, so if we can help small businesses, we help people get jobs.
- Many Australians have accessed their super in record amounts during COVID and broadened access to advice will help them restore their super balances.
- Helping add to the superannuation pool will see more Australians self-reliant in retirement.
- Accountants are accessible across Australia.
- Our proposed superannuation strategic advice measures as part of a tax agent service are consumer-centric.
- A vibrant financial services sector leads to more jobs as many advice providers are also small businesses.
- Post the Hayne royal commission, trust in the financial services sector needs to be restored – accountants are ideally placed to do this.
- Recognising CA qualifications will keep more accountants in the industry thus stemming the tide of many highly qualified professional advisers who are leaving.
- Post the Hayne royal commission, advice must be independent and in the clients’ interest. That is how accountants operate.
Mr Grant said professional advisers giving comprehensive financial advice could exist alongside a “cohort of professional business advisers” – accountants – offering simple, strategic superannuation advice.
“This should occur in the ordinary course of providing a tax agent service, however, at present it can’t be, due to licensing requirements,” he said.
Simplifying the rules could remove the need for suitably qualified accountants – who are or have recently been on the financial advice register or who are SMSF specialists – to hold an AFSL.
“With our proposed model, consumer protections are strong, as a qualified accountant who is also a registered tax agent is subject to rigorous and consumer-oriented ethical standards.
“CAs are well-placed to satisfy the advice needs of businesses and individuals in a professional and ethical manner.
“A simple way to bridge the advice gap is to keep highly qualified, professional accountants in the industry by recognising their qualifications in full.”