Last Friday, CPA Australia chief executive Alex Malley and ASIC chairman Greg Medcraft jointly launched CPA Australia Advice Pty Ltd, a wholly-owned subsidiary of CPA Australia.
Over the past seven days, around 600 CPA Australia members have registered formal expressions of interest in the company.
The global accounting body has also received a volume of general enquiries from both CPA members and non-members.
In order to be licensed under CPA Australia, advisers must be a CPA, a move which the body said would “address issues in the market now, but also encourage new entrants”.
CPA Australia also said it would “ensure all licensed advisers have the same strong education and professional backgrounds fundamental to providing quality advice.”
Mr Malley said that currently, 15 per cent of CPA Australia members (who total around 150,000) provide financial advice under a number of licensees, but extending the CPA Australia brand would further strengthen their presence.
“Some of those CPAs will be providing advice under other licensees and this is simply an alternative that young people coming into the sector will see as an impressive benchmark and will be given the option of being under the CPA banner,” Mr Malley said at the launch.
The company, which is expected to be operational by 1 July 2016, plans to provide advice that is free of commissions, offering it on a fee-for-service basis.
“CPA Australia Advice represents a game changer for financial advice in this country,” Mr Malley said.
“The operation of CPA Australia Advice will be consistent with Section 923A of the Corporations Act 2001 which allows us to use terms like ‘independent’, ‘impartial’ and unbiased’.”
Launching the venture, Mr Medcraft said CPA Advice Australia is the “right nudge” and will provide quality, better access to advice, choice and competition for consumers.
“When you quote a section of the Corporations Act and you are able to call yourself independent by the law, you are sending a very definitive message to the public,” he said.
Inundated with 0.4% of the membership. Yep I’m impressed.
The CPAs in our office thought all this advice stuff was great until they realised it has to be documented and compliant with the law.
Offering advice without commissions is a joke. Commissions have not been paid in the industry for sometime now. And nobody does something for nothing!
So long as the client is aware of what they pay and what they get for it, you can call it what you like. I’ve seen very ordinary tax advice from some CPAs. Why should their financial advice be any better.
I’m not surprised they have been inundated with enquiries. If you have been allowed by ASIC to get away with providing inappropriate superannuation switching advice into your own inhouse product for years, and then have the ASIC chairman turn up in person to launch your new business venture, you must have some sort of “special arrangement” status with ASIC. Who wouldn’t want that?
Will all go swimmingly until a few CPAs “forget” about the need to be PS146 qualified, “forget” about the need to provide SOAs or “forget” about details like FSGs, FNAs, FDS’. Then ASIC will step in and….. yes, it will still be all be OK because their mate Greg has publicly endorsed the business.
If you wrote a book it about it, you’d be ridiculed for dreaming up such unbelievable nonsense.
They obviously don’t have enough work as accountants to keep themselves busy. I also presume that they will then have to do the 40 CPD points as a planner per year as well as the CPD points as an accountant? I have learned over the years that whilst you can be good at two professions you can only truly be great doing one……
I have known of CPA Accountants that have fleeced customers through setting up SMSF Funds, charging them thousands for Audits and for setting up the fund even though the fund amounts were less than $120K. There are CPA accountants who are no better than the rogue financial planners, they see this CPA FP scenario as a prime choice to enrich themselves in a market that they see as “easy pickings” working under the camouflage of the CPA banner. They should stick to Accountancy and not dabble in other avenues just to get “rich”.