>Having facilitated M&A activity in the sector, John Birt of Radar Results says convergence between the two professions is still only in the earliest stages.
“Over the next decade, Radar Results believes the accounting industry will fully embrace financial planners, taking over and merging with many financial planning practices,” Mr Birt said in a communication issued yesterday.
“And, in reverse, many financial planners will want to acquire accounting practices, leading to purchasers paying an increased price multiple,” he added.
Accounting practices make appropriate acquisition targets for entrepreneurial advisers as they often operate on a fee for service basis and are therefore likely to be compatible with Future of Financial Advice requirements and be unaffected by grandfathering concerns.
However, in order for businesses to take advantage of the trend, financial planners and accountants need to “kiss and make up” and put recent animosities in the past, Mr Birt said.
“With some financial planners looking to provide taxation advice and needing to undertake further education to qualify themselves to do so, some media reports reveal a rift developing between these two professions,” he said.
The broker said that since the 1980s, accountants have “looked down” on financial planners, often in response to perceptions of poor advice received by common clients.
Mr Birt said the financial planning industry has come a “long way since then” in terms of education levels and disclosure practices.
Will financial planners and accountants bury the hatchet? Have your say below