CPA advice arm fuels member outrage

The accounting industry association and its leadership is under considerable pressure after announcing it will hold its annual general meeting in Singapore, the latest in a string of decisions made that have angered sections of its membership.

PwC managing partner Joseph Carrozzi for example took to Twitter to describe the AGM location decision as a “farce” that reflects poorly on “bean-counters everywhere”.

A petition is currently circulating among members that would see a number of reforms introduced, including reduced compensation for high-profile CEO Alex Malley and other directors, and greater transparency on the progress and funding of its CPA Australia Advice licensee. The document has attracted more than 100 signatures so far.

According to ASIC data, the licensee – which mandates compliance with the Corporations Act definition of independent advice – has attracted just 19 authorised representatives since the press conference in June 2015, during which Mr Malley appeared alongside ASIC chairman Greg Medcraft to launch the new subsidiary.

The relatively slow progress comes despite a $1.15 million loan made from CPA Australia to the advice business, detailed in the 2015 annual report, and an alleged 600 expressions of interest in the days following the initial announcement.

Speaking to ifa, CPA member and business owner Brett Stevenson said the financial advice business is one of a number of concerning issues among the membership.

“We want more information on the CPA financial planning arm,” Mr Stevenson said. “The pub test suggests this needs a closer look.”

In particular, the CPA member suggested whether the current spend on executive leadership of the advice arm may be excessive given the relatively lacklustre take-up rate.

More broadly, Mr Stevenson suggested CPA’s marketing initiatives have not been supported by the bulk of the membership.

“They are all about promoting Alex Malley,” he said. “This approach does nothing for members and nothing for the profession.”