The Australian Securities and Investments Commission is reminding all accountants and financial planners they have just two weeks left to obtain the necessary licence to allow them to provide detailed financial advice to self-managed superannuation fund trustees.
From July 1, anyone not licensed directly or authorised by an existing licensee who provides SMSF advice may fall foul of the law.
ASIC commissioner Greg Tanzer issued the warning at the Self Managed Superannuation Funds Association’s annual conference in Adelaide this week.
A limited Australian financial services license will allow holders to both set up and wind down self-managed funds.
According to Fairfax, ASIC has only received 346 applications for the licenses, of which 87 have been approved. Applications close on March 1.
Currently accountants who advise SMSF trustees on basic functions, such as setting up and shutting do-it-yourself funds are exempt from holding a licence.
Liz Ward, head of education at the Self Managed Superannuation Funds Association, told SmartCompany applying for a licence will be a judgment call for accounting and financial planning businesses.
“For accountants and financial planners post 1st of July, they need to think about what they’re offering to their clients, they need to look at their business and how many SMSF clients they have and whether the size of their clients means to what extent they need the licence,” she says.
“They need to make a judgment on their business as to what is the right decision for them, it’s not an automatic must to get a licence.”
Ward says now is really the “eleventh hour” for business owners to be contemplating the licence, as there is training and registry requirements to be satisfied before the lengthy application process.
“ASIC has flagged that they can’t guarantee that if an application has reached them after March 1 they may in fact get it [the licence] in time for the July 1 deadline,” she says.
However, the introduction of the licenses will make it easier for clients to know they are getting the best advice, says Ward, as all licence holders must have their license number on all stationery.
Anyone seeking financial advice can also search for their planners or accountants on the ASIC Financial Advisor Register to see if they are licensed and which areas they are licensed in.
Ward says clients should contact their accountants and financial planners and have a conversation about whether they will pursue licencing arrangements and if not, if the client will need to make alternative arrangements.
“By introducing these licensing arrangements it just means any of the conversations your having such as financial strategy, you’re covered,” she says.