CPA’s troubled advice arm set for PwC review

PwC has been charged with assessing the business rationale, conduct, operational principles and practices of CPA Australia Advice.

The licensing business will also be assessed for viability in the immediate and long-term, which, at this stage, appear troubled.

CPA Australia committed to the review in 2017, following recommendations from a governance and operations review chaired by former auditor-general Ian McPhee.

A statement sent to CPA Australia members on Friday was non-committal about the future of the advice business.

“Until the review is complete and the report is received and considered, the directors will continue to operate CPA Australia Advice in accordance with the existing operating structure,” the statement said.

As of November last year, CPA Australia Advice had a combined trading loss of $7.4 million since its 2015 launch. It has also only onboarded 37 authorised representatives to date.

It’s also an ongoing regulatory impediment, being central to the problems the association had with securing a professional standards scheme last year, which provides liability coverage for members in public practice. The Professional Standards Council (PSC) authorises the schemes and was, at the time, concerned by a potential conflict of interest the licensing arm posed.

Currently, CPA Australia Advice is raising questions about the association’s eligibility as a monitoring body under FASEA’s incoming requirements. Members who provide advice will need to join another approved code monitoring body to be compliant if CPA Australia does not have its recognition status approved.