A small business accountant has told a parliamentary inquiry that financial planners will always be motivated by self-interest and have a poor understanding of tax and superannuation issues.
In a strongly worded submission to the PJC inquiry into adviser standards, sole practitioner accountant Keith Compton lamented the end to the accountants' exemption, arguing that financial planners are not the most suitable professionals to be providing SMSF advice.
“No matter what rules and regulations are imposed on financial planners, I believe they will still operate in their own interest or at least push a particular line of investments,” Mr Compton wrote.
“Most accountants [by contrast] want to act in the best interests of their clients so as to minimise tax liabilities and to provide client businesses with appropriate planning advice so as to enable the client’s business to operate profitably and comply with all aspects of business law.”
Mr Compton railed against the decision to end the accountants’ exemption and introduce a limited licensing regime, arguing that accountants are much better placed to provide advice on “tax matters, including the establishment and running of self-managed superannuation funds” than “any present financial planner”.
The rules requiring accountants to become licensed under the AFSL regime make “no sense at all”, he added, arguing that professional bodies in the accounting space allow for adequate “checks and balances” to be in place.
“What is needed is for financial advisers to be degree qualified, not qualified by what is nothing more than a ‘cereal box’ qualification,” the submission adds. “If accountants in practice could retain their exemption, this removes the need to create these sub-qualifications and ensures that clients and investors at least receive advice from suitably qualified persons.”
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