Speaking on Accountants Daily Live, the webcast show of ifa sister title Accountants Daily, Knowledge Shop chair Greg Hayes said the industry estimates around 10,000 financial planners out of a pool of 25,000 will leave the advice space by 2024, when FASEA’s education requirements kick in.
Earlier this year, ifa found that 75.6 per cent of 3,536 respondents indicated that they would leave the industry after the introduction of FASEA’s mandatory education standards.
Mr Hayes believes the vast majority of those leaving the space will be due to their age and appetite for further education, leaving behind a void that is a “natural” fit for the accounting profession.
“We are going to see a contraction in the supply of advice at the same time as we’re going to see an increasing demand because of the size of the market growing,” said Mr Hayes.
“The accounting profession is the natural provider for advice in this space. I look at this and think it is an enormous opportunity for accountants.”
However, Mr Hayes believes some accountants have been caught up in the criticism of the new education requirements instead of looking at the market opportunities over the next five to 10 years.
“I’m disappointed with some of the commentary from the accounting profession,” said Mr Hayes.
“I think the focus has been around the nitty gritty stuff like we’ve got to do an exam, we’ve got to do CPD, I think there needs to be a discussion to lift your eyes up and have a look at this opportunity.
“If accountants are going to stake themselves in this market, they’ve been given preferential positioning relative to the broader advice market – there’s this opportunity sitting there if they want to take it.
“None of us necessarily likes change but we need to accept that and whilst this is being worked through, look at the bigger picture.”
‘Fix the law’
Institute of Public Accountants chief executive Andrew Conway accepts that while there is an opportunity for accountants to step into the void and diversify their service offerings, the regulatory regime needs to be addressed to allow accountants to enter the space.
“Every accountant would see it as an opportunity, it is actually a question of them being hamstrung to go and do it,” said Mr Conway.
“The frustration that accountants say to us all the time is that this is a natural fit for us and always has been but we can’t have the conversation that we were once able to have.
“I accept that there has to be accountants who want to provide advice stepping up to commit to further education but it shouldn’t, in our view, be a graduate diploma; it shouldn’t be at the expense of throwing out of the window all the study that has been done for your professional qualification. We agree there is an immense opportunity to [diversify] your practice but we just have to fix the law to allow accountants to do it.”
remember that CPA/CA is the same social status as lawyers. we trust an qualified accountant and a lawyer, but not so much a financial planner/advisers whatever it is called.
Rubbish. According to ASICs AR register, Count Financial (one of the largest licensees nationally, and accounting focused to boot) has ceased over 180 ARs this calendar year alone.
And let’s not forget CPA Advice (and their Naked CEO)!
This is not the time to do two things at once. Do one thing and do it well.
I want to become an Accountant, but don’t want to have to attain the necessary qualifications, and want exemptions and rule changes to suit myself…. this is basically the opposite of their argument.
Wait….I cannot quite understand the accountats side of the argument. Accountants want to provide advice but dont want to do the full training and think they should be exempt.
Where as they think that advisers who are currently accredited to a WORLDWIDE recognised standard (CFP) have to go back to uni to listen to a lecturer telling them how to do the job they have done for the last 30 years.
On top of this, the accountants think we should have to sign up to the TPB and pay our subscription to one of our useless adviser bodies plus a subscription to an accounting body to explain that Income Protection may be tax deductible outside super.
As SD said above. Everyone else is allowed to give financial advie without any of these pointless courses and memberships as long as they have no training or education.
If the politicians (in their infinite wisdom) remove all payments from product providers and we bill our clients ourselves then we can get rid of all this compliance and education rubbish and provide advice like everyone else with no SOA and BID and charge the clients directly.
Just make sure you dont waste your time on the FASEA and get too qualified
I continue to read this nonsense call from the accounting world. If they wish to legally give advice then they need to follow in the same foot steps of the required education & training as an adviser.
Why on earth would an Accountants want to provide licensed advice. They should just keep providing it unlicensed, and if they get caught, all that happens is they get banned from providing licensed advice which they never were anyways! Its perfect!
Our planning firm deals with over 12 accounting firms and have had experience at an AFSL level with other substantial accounting firms who ‘diversified for the opportunity’ without a qualified planner involved. Unequivocally if they do not treat it as a serious singular profession, it is an abject failure with serious levels of risk involved (including client remediation in one example of a couple of hundred grand).
It can be a beneficial adjunct as long as it is done correctly with the right intentions from the start, with full understanding of the substantial costs (time and overheads).
CPA advice, res ipsa loquitur (Latin for ‘speaks for itself’ or essentially proof of fact, or self evident).
Cheap articles like this or self promotions by self interest groups do little but add further problems to everyone, including the planning profession.
you just can’t help but laugh at the status of the CPA’s they not only firebombed themselves via their ill ventured foray into financial planning, but had to pay $4.5m to exit their buffoon ex-ceo – the naked guy – they are a laughing stock of all professional associations, the only one’s who come close are the FP
So accountants should be able to take on this role with specific training in the matters concerned?
I contend accountants are not suitable advisors in these matters as this requires the ability to develop strategies and think ahead, not merely record history as is their strength.
If they wish to venture into this area they must be subject to the same standards as advisors. How well would accountants measure up when subject to this level of scrutiny?
so you are basically saying that accountants are book keepers at best and cannot think strategically at all. and should therefore stick to their knitting which is doing basic arithmetic
This, I feel, will not happen, CPA had their chance last year and had to close it down due to minimal take up, plus those that did then found that the compliance burden was far too onerous to continue. So they then continue to provide “unauthorised” advice as they always have.
If an accountant wishes to “diversify” their business then they should employ a qualified adviser or team up with one. I doubt you would be so happy to have a degree qualified adviser to just be able to walk in and give tax advice without more education.