Generally, financial planning associations and accountant bodies have welcomed the replacing of the current licensing exemption for accountants with a new form of financial-advice licence on SMSF (self-managed super fund) and basic product advice, as just announced.
Bill Shorten, the Minister for Financial Services and Superannuation believes the new and limited Australian Financial Services Licence (AFSL) will significantly increase the availability of financial advice and create an opportunity for thousands of small-practice accountants and financial advisers.
Those eligible for the new licence will be professional accountants who hold a public-practice certificate, which will replace the requirement for accountants to demonstrate the relevant experience to apply for the new licence. However, they will still need to demonstrate they meet the training requirements to hold a licence and provide financial advice.
In addition to being able to advise on SMSF and superannuation generally, licence holders will be able to give “class of product advice” on basic deposit products, general and life insurance, securities, and simple managed-investment schemes.
Importantly, the new licence does not allow specific product recommendations but is designed to enable accountants and any financial advisers who may hold this designation to provide more strategic and low-cost forms of financial advice.
As recognition of accountants’ existing professional qualifications, a transitional period from July 1, 2013 to July 1, 2016 has been made available to those wishing to comply with the AFSL regime. In the second half of the year there will be draft consultations.