Changes to accountant licensing and advice you need to know


If your accountant gives you investment and strategic advice on your self-managed superannuation fund (SMSF), you may have to find another source of guidance. Unless he or she has obtained a limited or full Australian financial services (AFS) licence by June 30, 2016, they will be unable to continue advising SMSF trustees on a range of issues, including investment strategies and pensions.

"Unfortunately, SMSF clients will be inconvenienced as their accountant won't be able to tell them much before they tip over into advice," says Liz Ward, the head of education at the SMSF Association.

Australians typically start an SMSF on the recommendation of their accountant. There are over 550,000 DIY funds with more than 1 million members. But so far the Australian Securities and Investments Commission (ASIC) has received only 226 applications for limited licences, and of these only 78 have been issued, says Ward. "This is despite the fact the process has been open for more than 21/2 years. Across the industry there is concern and, to some degree, bewilderment about what the thousands of accountants who now advise SMSFs are going to do after June 30."


Trustees will only be able to obtain tax advice from their accountant and will need to turn to experts with the right licences, such as financial planners.

If your accountant doesn't have a licence, don't bother asking them if they recommend you start a SMSF, or for the performance of different types of super choices, or if they recommend one fund over another, or if you should consolidate your assets into a single fund or increase your contributions above the super guarantee amount of 9.5%, or if you should commence a pension. They won't be able to recommend a property purchase through an SMSF, prepare an investment strategy or recommend types of investments.

"We strongly recommend that accountants intending to provide SMSF advice apply for their AFS licence, arrange their personal indemnity insurance and join the Credit and Investments Ombudsman service before March 1 to allow sufficient time for assessment," says Raj Venga, ombudsman and chief executive officer. CIO is an industry-funded dispute resolution scheme with more than 20,000 financial services providers as members.


Susan has been a finance journalist for more than 30 years, beginning at the Australian Financial Review before moving to the Sydney Morning Herald. She edited a superannuation magazine, Superfunds, for the Association of Superannuation Funds of Australia, and writes regularly on superannuation and managed funds. She's also author of the best-selling book Women and Money.
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