After 30 years in public practice I found myself in the position of having to go back to school last year and obtain a new qualification, specifically to advise our clients who have self-managed superannuation funds.
You might be aware that the Government recently enacted new financial services legislation dealing with how financial advisors interact with and advise their clients to ensure that they act in the best interest of their clients. Whilst most professionals (the good ones anyway!) would always follow this principle, the Government deemed it necessary to build this concept into the law governing the provision of financial advice.
We as accountants have also been caught up in the financial services legislation. So whilst we have always provided advice to our clients on setting up and running self-managed superannuation funds, (including making contributions and withdrawals, starting and commuting pensions and the like), this type of advice is now covered by the new legislation. The effect of this has been to raise the qualification bar for all accountants providing this type of advice, which Munro’s views as a very good thing. It means that only accountants who have met additional education requirements and are properly authorised and monitored, may now provide clients with advice relating to self-managed superannuation funds.
In order to ensure that Munro’s clients could continue to receive quality SMSF advice legally, the firm took the decision to invest in training four senior accountants to enable them to qualify as advisors and become Authorised Representatives as prescribed by the Australian Securities and Investments Commission Policy RG 146. The result is that each of the four spent some 60 hours or more studying, writing assignments and doing exams and Simon Strawbridge, Ben Paul, Mike Beer and Christine Prasetia all became duly authorised.
Authorised Representatives have to operate under an Australian Financial Services Licence and the four Munro’s Representatives operate under the licence granted to SMSF Advisers Network Pty Ltd (SAN) which was set up specifically to enable accountants like us to continue to provide advice and services to our self-managed superannuation fund (SMSF) clients.
One consequence of complying with the new financial services regulations is that we now need to provide Statements of Advice for each of our SMSF clients. The process involves collecting information about you and your financial circumstances – (a “Fact Find”) – so that we are fully informed and can therefore act in your best interest. Once we have the facts and knowing your circumstances we are then in a position to compile a Statement of Advice – all of which is monitored by the licence holder - SAN.
So going forward, we will certainly have more compliance activity to attend to under the new regulations. We are, however, confident that you will continue to receive great benefit from our advice on your SMSF and we will give our best effort in driving the cost of compliance down whilst at the same time ensuring that you receive the best value.