Limited licensing for accountants is ‘dangerous’: consultant
Accountants hoping to break into the financial planning industry should seek to become fully licensed, as limited licensing options would be dangerous for clients, argues Radar Results principal John Birt.
In a statement, the business broker said if accountants want to provide quality financial advice, they should be committed fully to the industry standards and processes.
"Would you be happy to have a part-time surgeon give you a triple heart bypass? You just can't do it part time," he said.
"I can see what the government wanted to try and achieve by offering this band-aid solution, but I cannot see it working effectively. You're either fully in or fully out. That's how mistakes are made when you do something half-hearted."
Mr Birt added that a major concern regarding limited licensing is that professional indemnity insurance providers might not offer full coverage for limited advice.
Further, dealer groups may not be looking to bring any limited licensed accountants because of certain risks. He said HNW Planning, a non-aligned AFSL, was one of those groups that decided to only work with fully-licensed accountants.
"When licensing of accountants was first announced, HNW Planning hoped to attract many accountants to its AFSL. They have since looked at the risk/returns and have decided against that approach," Mr Birt said.
"Instead, they're concentrating on providing a high service to a few accountants prepared to fully engage in the process."
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