In a submission to the TPB, the IPA said incoming “tax (financial) advisers” under the Tax Agent Services Act regime should undertake comprehensive studies in taxation law.
“The provision of tax advice is inextricably connected with the provision of financial advice and therefore establishing appropriate education requirements including relevant education in Australian tax law is essential,” said IPA chief executive officer Andrew Conway in a statement.
“We are already concerned that financial planners who are able to register due to their professional association membership will not be required to satisfy any tax or commercial law education requirements.
“There should be a level playing field but there isn’t; in the new regime, accountants have to do their RG146 with no free kicks in education requirements.”
Mr Conway added that the additional education requirements are necessary in order for the best interest duty and public interest to be upheld.
No one disputes an Adviser’s obligation to [quote name=”GeorgeVC”] equip one with a set of fundamental skills to understand relevant rules in that discipline, and how to interpret and apply the changes in practice.[/quote] I disagree a University Degree is the only method in obtaining these requisite skills. Independent examination and accreditation is vital in re-establishing trust with the community.
Financial Planning has evolved (unlike Accounting for example which was created in the 14th Century) making prior learning and experience more important than other professions.
Given 32 of the last 35 Insider Trading convictions in Australia were made against former USYD Students, it could be argued graduates from there pose the greatest risk to consumers of all!!
[quote name=”JRH”]George, I’m not sure you’re really making the point you think. The submissions made against mandatory degrees simply say that with constant changes in regulation, Continuing Education and external accreditation are far superior.[/quote]
Accounting, law, medicine, engineering degrees etc only equip one with information at the start of a career, that quickly goes out of date due to legal changes, tax interpreation or technology.
But what it does do is equip one with a set of fundamental skills to understand relevant rules in that discipline, and how to interpret and apply the changes in practice.
Every profession is required to keep up to date in an ever changing environment, not just FP’s. That does not invalidate the need for a basic skill set, values learned through accomplishment and a lot more, that a Uni degree provides.
[quote name=”GeorgeVC”]One wonders how FP’s will cope as tax agents, when they reject mandatory degree calls (ifa 1 Oct story).[/quote]
George, I’m not sure you’re really making the point you think. The submissions made against mandatory degrees simply say that with constant changes in regulation, Continuing Education and external accreditation are far superior.
The “[i]Big Ticket[/i]” items to which you refer did not exist 30 years ago.
Under your proposal a 55 yo Sydney Uni Commerce Grad with a marketing major who was barely taught the progressive tax system is more able to provide advice on complex tax matters than a person who has passed an independently assessed exam on [u]current [/u]tax legislation.
Not sure I agree with you.
So, how about the SMSF advice given by accountants, what qualification is required?
I recall a time (late 90’s?)when all CPA’s could do a 1 hour easy peasy test and whammo, got their CFP from the FPA. Most with very little ability to provide planning advice, let alone CFP quality planning advice. Perhaps CPA could do the same for us CFP’s… Ha ha.
One wonders how FP’s will cope as tax agents, when they reject mandatory degree calls (ifa 1 Oct story).
Taxation is a complex area of law, with 78 years of litigation and statutory amendments since 1936. All to be considered in any tax advice.
And its not like FP’s will be advising on simple work related deductions, its the big ticket items like CGT, small business retirement exemptions which are the purvue of taxation experts.
Getting these wrong can be a financial disaster for clients when they are slugged with a huge tax bill.
FP’s wont be able to rely on disclaimers for their often ill-considered tax advice they give that “it should be checked by your accountant” .
And if FP’s intend to rely on their dealer groups to solve their high level tax advice issues in the future, then you are back to where you started…. just salesmen really.
Andrew, it is a level playing field. Accountants had a 3 year exemption and planners will have the same. Anyone who thinks TPB wont require us to have more than our CFP and FPA membership is imo nave. It will be interesting to see what TPB comes up with but I believe even the CFP course and FP degree courses are insufficient for the type of strategic tax advice many of us provide these days.
Seems logical. There is no doubt that the accounting bodies (and the public) may assume that financial planners have not undertaken any taxation studies at all. This incorrect perception would perhaps be used to undermine financial planners
So there is a need to get the message out that CFPs at least have undertaken taxation studies
There should be a level playing field but there isnt; in the new regime, accountants have to do their RG146 with no free kicks in education requirements.
Also agree. But Mr Conway you do yourself no favours with the comment above. This should be about clients’ best interests not competition between accountants and planners about who gets away with what.
Yep fair enough – might find most already have.