Accounting bodies will consult with ASIC in the wake of the passage of financial advice reforms through the Lower House of Parliament, however, accounting chiefs believe greater detail is needed to ensure their members are not disadvantaged by ‘regulatory arbitrage’.
Institute of Public Accountants (IPA) chief executive Andrew Conway said the IPA supported the Future of Financial Advice (FOFA) reforms as a stand-alone body as well as part of the Joint Accounting Bodies (JAB).
IPA’s support of FOFA had included opt-in, whereby financial advisers would need to get fresh contracts from clients every two years, he said.
But the support extended to the alternative to opt-in added to the legislation at the last minute: adherence to an ASIC-approved code of conduct.
However, he said the government’s reforms did not reflect the tough educational and ethical standards the accounting industry imposed on itself.
“What we have been advocating for is a level playing field, so we don’t have a situation where a practitioner or an adviser looking for some form of arbitrage between bodies so they can get across the line quicker,” Conway said.
“What we’re keen to see is a level playing field and, importantly for accountants, some recognition that accountants are starting from a different point,” he said, adding accounting body members were already recognised in law as being professional accountants.
The Institute of Chartered Accountants of Australia head of financial advisory services Hugh Elvy said the ICAA awaited more detail from FOFA.
“There’s been a bit of discussion about whether opt-in would actually have to be part of that code of conduct or whether it would have to be referenced in the code of conduct,” Elvy said.
“Will there need to be reference to various forms of remuneration that would obviate the need for opt-in? I still think there needs to be a fair amount of detail that needs to come out to clarify that.
“In saying that, from the institute’s perspective we’ve got a range of standards that members have to meet as part of being a member of the institute so we have to look at where they actually fit as part of the equation as well.”
ICAA, the IPA and CPA Australia make up the JAB.
