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February 28, 2013

Limited Australian Financial Services Licence for accountants

The Government has announced that it will finalise the regulations for limited AFS licences for accountants in April 2013.

The new licence will be required from 1 July 2013.

Accountants will be able to provide advice in relation to establishing, and investment strategies of an SMSF; superannuation products more broadly as a product class (but not particular products); general insurance products broadly (but not particular products); and basic deposit products broadly (but not particular products).

In order to facilitate the transition of accountants into the new regime, the regulations provide for 'recognised accountants', that is someone who is an ICAA, CPA or IPA member with a streamlined licence application process between 1 July 2013 and 1 July 2016 and a lower level of licence application requirements.

'Recognised accountants' will not have to demonstrate they have experience providing financial services to receive the limited licence.

Licensees who receive an AFSL under this streamlined process must complete a knowledge update review within three years of the date on which the license is granted to maintain their licence.

After 1 July 2016, accountants seeking to obtain an AFSL will be required to satisfy the same experience requirements as anyone else.

Limited AFSL holders will be subject to all of the regulatory requirements that apply to the provision of personal advice.

The new licensing regime removes the existing obligation of an annual external audit of financial statements and compliance arrangements and replaces it with an obligation to provide an annual compliance certificate when the limited AFSL holders do not handle a client's money in connection with the provision of the advice they give.

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Posted 28th February 2013 by David Jacobson in Financial Services, Future of Financial Advice Reforms