Professional Investment Services (PIS) has seen operating expenses increase 8 per cent for the first half of the financial year due to increased compliance and claims costs.
Centrepoint Alliance, which owns PIS, reported its half-year results to the market on Friday.
The group reported a $2.2 million pre-tax profit for the half-year, compared to a $1.7 million loss in the prior corresponding period.
The wealth management division of Centrepoint Alliance reported an underlying pre-tax profit of $3 million, down from $5.3 million in the first half of the 2012/2013 financial year.
PIS saw net revenues fall by 7 per cent to $11.5 million “primarily as a result of the reduction in adviser numbers in 2013 and associated funds under product distribution agreements”, according to a Centrepoint Alliance statement to the ASX.
“Operating expenses increased by 8 per cent to $11.3 million, primarily as a result of restructuring costs; the hiring of compliance and claims management staff; and investment in new capabilities for future growth,” the statement said.
Claims activity continues to be “closely monitored” and activity for the half was “in line with the activity projected by the independent actuary in August 2013 using data up to 30 June 2013”, said Centrepoint Alliance.
“Claims management is now being undertaken by PIS staff to reduce costs previously incurred with external legal consultants and to improve outcomes.”
ASIC accepted an enforceable undertaking from PIS in December 2010 under which the company agreed to engage an independent expert to review PIS’s compliance with financial services laws.
The final report as part of the advice group’s ‘Ongoing Monitoring Program’ is due to be submitted to ASIC in April 2014.
ASIC has revealed it was forced to take action on more than a dozen incidents of...
The government has flagged it may look at extending regulatory provisions for sc...
New data from Roy Morgan has shown despite overall superannuation fund satisfact...