On 5pm on Friday afternoon the NTAA’s leadership finally broke its silence, authorising a media release in response to the original statement, claiming last Monday’s vicious comments about the integrity of financial planners were warranted.
“The recent article regarding approaching a stranger for financial advice has created significant response from membership groups such as the Financial Planning Association of Australia (FPA) and the Association of Financial Advisers (AFA),” the statement conceded.
“Like these groups, (NTAA) is a group that exists to represent its members. In producing the article in question, the NTAA was simply expressing the view of its members.”
The statement said that during the recent NTAA tax school seminars, NTAA members voiced their frustration with the “financial planning community” and the accountant’s exemption rule.
While the follow-up statement gave a half-nod to harmony, suggesting the NTAA’s membership is against a “turf war” between the two sectors, it went on to reiterate the sentiments in the first release.
“While the NTAA understands that its comments have angered some in the financial planning community, the media release was intended only to warn retirees about protecting their retirement savings, as the actions of an unethical adviser on an unsuspecting consumer is potentially catastrophic,” it said.
“Whilst we acknowledge there are ethical and responsible financial advisers it must also be acknowledged that a consumer may find it difficult to determine a financial adviser’s competence and integrity.
“Further, the article counselled that if the accountant was not a financial adviser then the accountant could provide a referral to a financial adviser that they know and trust.
“This is where the accountant with whom the client has built a trusted relationship over time can provide great value.”
The statement also claims that “groups such as the FPA and AFA believe there to be little if any divide between the financial planning industry and the accounting profession”.
However, just last week AFA chief executive Brad Fox, when speaking to ifa about the NTAA matter, said “accounting and financial planning are not the same thing, they have never been the same thing – you can be licensed to do both – but they have very different functions”.
The statement then goes on to promote NTAA Advice, a separate association which it says aims to guide its members “through the transition to giving advice under the requirements of the Corporations Act when licensed under an [AFSL].”
The NTAA remains unavailable for an interview.
Sorry to say that the FP industry is seen as a untrustworthy by many people & industries. The whole fofa regime confirms this. The compliance regime & silly soa situation cements the view that people can not trust a financial planner. Sorry but it is true. Clients need protection from man FP’s and their ridiculous charges. Why should clients have to fund this useless compliance regime & its good for no one paperwork. We need a new industry, a new measure, a new body & a new policing system that erases this compliance burden & crushes the bad apples quickly & harshly. BRING BACK COMMON SENSE!
Listening Asic? Detach this industry from the leeches like the fpa & start again.
[quote name=”Andrew”]Steve-jj, you still havent answered my question. Keyboard Warrior it is then.[/quote]
Andrew lets stick with the subject shall we? You defended a poster attacking accountants due to their ability to ‘rort’ the tax system.
I claim that much of the basics of FP are very similar, rorting the tax and legislation to effect best outcome for clients.
Either you agree with my assertion or you don’t. A simple yes or no will suffice.
A rock and a hard place one assumes?
If you agree with me then you are doing the best for your clients, but have to eat some humble pie – no biggie.
If you don’t agree then you are not advising in your clients best interests and therefore open to a claim.
Steve-jj, you still havent answered my question. Keyboard Warrior it is then.
Move on.
Andrew – do you agree that FP owe a duty to their clients to ensure that they get the best outcome, same as an accountant.
Many of the FP strategies are based on ‘working the angle’ from a tax and legislation point of view. To attack accountants because they do the very same is unprofessional and naive.
As is your reply.
Your comments are invalid Steve-jj. Firstly you attack Barden for being unprofessional and nave, you then generalise by assuming he is an FP, you then add weight to his argument by acknowledging that rorting is inherent in both FP and Accounting.
I still fail to understand why bloggers such as yourself troll this website. Its plain to see you are not a Financial Planner. What are you hoping to achieve with your diatribe? Your generalisations are quite insulting. May we enquire as to which industry you hail from or are we to assume you are just another keyboard warrior with too much time on your hands?
[quote name=”barden”] Also, what profession sets out every year to rort and exploit the taxation legislation – year after year ? Wouldn’t be the precious leading edge accountants ??[/quote]
What a naive comment, sir. Again shows such a lack of professionalism and intellect of behalf of FP industry. There is so much to learn.
Don’t FP do this as well? If not then are they acting in their clients best interests.
Recontibutions, life time lump sum, splitting contributions, getting at least $1 Age Pension, multiple pensions, income stream as a lump sum etc etc – are these not rorts and exploitation of the system??
Fact: There are far more accountants in Australian jails than Financial Advisers. Also, what profession sets out every year to rort and exploit the taxation legislation – year after year ? Wouldn’t be the precious leading edge accountants ??
Everyone who has lent mates a few bucks is an idiot if they don’t soon learn about risk & planning. DONT GIVE ANYONE ANYTHING IF THEY DONT AT LEAST GIVE IT BACK & DONT GIVE ANYONE EVERYTHING. DROP & DIVERSIFY! My experience has taught me Accountants know more about risk & avoiding it than any other pro…Think about bankruptcies!
But I’m only a simple minded Engineer!
[quote name=”mark”]NTAA is a self serving disgrace. Accountants rarely know nothing about risk planning, unless they have an adviser.
The education con job is a joke. A degree doesn’t make you competent or honest, until you realise that simple fact there will be no hope for you or your precious ntaa[/quote]
So Mark, maybe a FP is best to deal with risk planning. How much do you charge for a risk plan, and how much say every two years for a review.
Scaled advice, maybe?
NTAA is a self serving disgrace. Accountants rarely know nothing about risk planning, unless they have an adviser.
The education con job is a joke. A degree doesn’t make you competent or honest, until you realise that simple fact there will be no hope for you or your prcious ntaa
the ntaa are obviously not reputable, grasping for attention.
comparisons to other professions is also meaningless, comical and inevitably nasty.
the way forward is to learn from feedback, however critical or indelicate.
this is all about trust. if you dont know why planners are not trusted, you wont be doing anything today to reverse it. which is damning when planner reputation is in crisis.
looking ahead, if today’s situation is bad, try to picture the backlash and fallout planners will experience after the next downturn.
A few years before retiring & after talking to perhaps 6 or 8 advisers I discovered how little they knew & how much they charged so went to a friend/ accountant to set up an SMSF. This he did very reasonably,professionally & promptly. I was astounded when he told me that strictly speaking he was not allowed to give me advice. I concluded it was a demarcation or union based thing & found his well meant verbal chat far more use than dear written ‘advice’ /zilsh year after year for high trailing commissions that mates were getting. I now do everything myself except the audit
All of the known “professions” self regulate. Like builders, financial advisers were so unruly that Government needed to step in and regulate them to protect the public interest. That is why other professionals resent being told by financial advisers what they should or shouldnt do, because they hold a “licence” to do it. Thats also why accountants are so resentful of being dragged into your over-bearing ASIC licensing regime. We just didnt earn your punishment so why should we be tarred with the same brush. An FP is only as good as their education and experience, like the rest of us.
Ask an accountant or a lawyer what job they did before their profession. Usually, they were at school then Uni. Ask a financial planner and they always have a story about a previous occupation which all too often has nothing to do with investments or taxation e.g car salesman, bra salesman, farmer, veterinarian are a few that I have heard.
Go with the FP who was an Accountant!
[quote name=”PC”][quote name=”Steve-jj”]Quote
So, how does the FP industry differentiate good from average planners.[/quote]
good question, maybe the tax agents can shed some light on how they distinguish between good and average tax agents.[/quote]
PC – you do the FP no service in taking cheap shots. Why not put some of that grey matter to work and answer with some creative juices.
Forget about accountants- what is the FP industry doing to determine who are the best experts in any particular sub field rather than a general FP who apparently is an expert of abut 5 different fields.
Once there is a recognized expertise basis then clients will leave their accountants and come to a FP. Until then they don’t know if they are dealing with a dude who was a second hand car salesman last year – apologies to car salesman, for they do a great job, like all of us earning a crust.
Fiona, how ironic that you base so much emphasis on the benefits of holding a degree and yet you have directed your indignant retort to the wrong participant.
I too though am curious to know what what this level of “Technical Maths” accountants have to know. Surely Trigonometry is not required? Does excel even allow for that?
Chris – what a ridiculous comment.. “most accountants stumbled over year 12 general maths” and on what authority do you base this on… Sounds like a purely uneducated comment to me – So you think it OK that someone with a diploma – because he couldn’t get into Uni- ruins his clients lives because he couldn’t work out that even the SOA doesn’t add up.
Having been in the industry for more than 30 years I have found most accountants are to busy to devote the time to really know their clients fully. They do a good job in tax planning and returns and some business structure plus the time required to keep upto date.
I have found many new clients have never been alerted to the government co-cobtribution thus costing them thousands of dollars in lost super returns.
At our pratice we reinforce with our client they need a pofessional team, accountant, solictor, financial planner and a good mortgage broker as if we work as a team there would not be the under insurance and lack of retirement short fall as there is to day.
[quote name=”Fiona”]. Accountants have at least a degree with some very technical mathematical courses to pass.[/quote]
Generalisations such as this don’t help anyone. There are still thousands of accoutants without degrees (admittedly olders ones). And it must be a recent change in the syllabus of accounting degrees to include “very technical mathematics” because most accountants stumbled over the line in Year 12 general maths and were attracted to commerce precisely because maths/ science was not their strong suit.
Very technical mathematics = applied maths/ pure maths / mathematical statistics not “business maths”
[quote name=”Steve-jj”]Quote
So, how does the FP industry differentiate good from average planners.[/quote]
good question, maybe the tax agents can shed some light on how they distinguish between good and average tax agents.
“Financial Planner” has always been a nebulous term. It implies expertise in many disciplines such as taxation, estate planning, insurance, investing, finance etc.
Accountants, lawyers, insurance advisers, stock brokers, bankers work all of their lives to become experts in these fields.
All those professionals find it hard to believe that a “financial planner” can become a master of all of those disciplines by being given a license, often with little experience in any of those fields.
In my opinion, FP needs to be broken back down into it consitiuent elements of investment adviser, financial strategist, tax expert, super expert, insurance adviser, estate lawyer.
Only then will the other professions and the public know who they are dealing with and what they are capable of, so we can all get on with it.
There are accountants who have experience, education and knowledge, there are financial planners who have experience education and knowledge and then there are persons who have none of the above providing advice and losing peoples life’s savings.I have a number of cases against FP’s who clearly have none of the above and who have put their clients homes and savings into absolutely inappropriate products. I have 2 separate matters with 75 year olds put into margin schemes – they’ve both lost everything and better!! they were only ever expected to get returns of less than the margin interest rates!!. Some FP’s can’t even work out the simple maths. Accountants have at least a degree with some very technical mathematical courses to pass.
Quote ‘Whilst we acknowledge there are ethical and responsible financial advisers it must also be acknowledged that a consumer may find it difficult to determine a financial advisers competence and integrity.’
So, how does the FP industry differentiate good from average planners.
Enough already from the NTAA
In 25 years of risk advising, I have never met a tax agent (TA) who knew anything about income protection. They dont understand that insurers issue IP benefits based on net personal exertion imncome, not the TA fancy formula for income designed to fudge the tax payable.
TAs continue to make misleading statements about ” your IP premiums are expensive ” at tax time, without an AFSL. When they finally get around to doing the books, they fudge tradies P&Ls to make themselves look good to the tradies – ” you’ll pay less tax with me , buddy”, never explaining to the tradie that when it hits the fan, the ATO hits the tradie
And God save us from entreprenaurial TAs who recommend investments to which they are directly, or indirectly, connected.
The TAs of my experience can rarely be described as “professionals” and are NOT in any position to dish dirt on planners in general, and in particular ,risk advisers.
NTAA – head in the sand, deeply in the dirt and acting like a bike rack above!!
an unabashed publicity stunt to try to get their members to join their dealer group.
shame NTAA shame
I have a email the NTAA has sent to all its member accountants trying to have them sign up to its new licencee dealer group, bagging the institutions etc…..
They are going down the same lines as industry funds, i guess they feel that type of marketing works. I dont agree, what they probably fail to understand is majority of their members have relationships with FPs. Very Dumb NTAA.