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Accountants submit in favour of exemption

Accountants are making a submission in favour of the continuation of an exemption that allows them to offer financial advice in the course of their normal business.

Monday, February 29th 2016, 5:59AM 6 Comments

Good Returns reported last week that the Law Society is also in favour of the clause in the Financial Advisers Act. It allows them to offer advice that a financial adviser would have to be authorised to offer, if it is an incidental part of their businesses.

Some financial advisers have expressed concern at the exemption and the potential unfairness it represents.

But MBIE has said it is not something it is concerned about because there is no evidence it is causing consumer harm.

A spokeswoman for Chartered Accountants Australia and New Zealand said her organisation supported accountants being able to provide financial advice without coming under the scope of the FAA.

It was to make a submission on the options paper by the deadline of last Friday.

The organisation said one of the FAA goals was to increase public confidence in the professionalism of financial advice.

“Chartered accountants are recognised by consumers as professional, as a consequence the framework in which CAs operate reflect the traits and characteristics the financial advice industry is endeavouring to achieve. A further element to consider is the issue of accessibility and also the type of advice consumers need.”

Tags: Financial Advisers Act

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Comments from our readers

On 29 February 2016 at 7:41 am Murray Weatherston said:
If MBIE's test for removing the exemption for lawyers and accountants is that there be actual "evidence that it is causing harm", why do they keep repeating the mantra that insurance and mortgage advisers need to be included in the regime because they MIGHT cause harm.
Why are the criteria different?
On 29 February 2016 at 10:23 am dcwhyte said:
Here we go again! A favoured lobby group makes some specious arguments against compliance, and the regulators buy into the bull-dust!

The same remarks apply to both lawyers and accountants - there is nothing in their training or in their professional supervision that qualifies them to advise on investment or insurance issues.

"There is no evidence of consumer harm" - exactly how does anyone establish this?

Alternatively, how would the regulator suggest that an interested party gather such evidence?

"Chartered accountants are recognised by consumers as professionals...." I wonder what the clients of David Ross would make of that statement?

According to the CA's Disciplinary Committee webpage - www.nzica.com/dt.aspx - there were over a dozen members called to account in 2015 - with a few "names withheld".

This may well point to an effective governance of the professional accountancy standards, but does not address the specific competency questions around investment and insurance.

While most sensible accountants who wish to offer investment/insurance advice have gone down the path of obtaining the necessary qualification to offer such advice, the requirement for an exemption smacks of the "Old Boy" network.

The professional body should be encouraging their members to meet the appropriate standards to offer specialised advice in a specialist area.

The body should be endorsing regulatory efforts to protect consumers rather than seeking special treatment for their members.

There is no evidence of any reason for an exemption.

No exemptions, no exception!
On 29 February 2016 at 11:03 am dcwhyte said:
Here we go again! A favoured lobby group makes some specious arguments against compliance, and the regulators buy into the bull-dust!
The same remarks apply to both lawyers and accountants - there is nothing in their training or in their professional supervision that qualifies them to advise on investment or insurance issues.
"There is no evidence of consumer harm" - exactly how does anyone establish this?
Alternatively, how would the regulator suggest that an interested party gather such evidence?
"Chartered accountants are recognised by consumers as professionals...." I wonder what the clients of David Ross would make of that statement?
According to the CA's Disciplinary Committee webpage - www.nzica.com/dt.aspx - there were over a dozen members called to account in 2015 - with a few "names withheld".
This may well point to an effective governance of the professional accountancy standards, but does not address the specific competency questions around investment and insurance.
While most sensible accountants who wish to offer investment/insurance advice have gone down the path of obtaining the necessary qualification to offer such advice, the requirement for an exemption smacks of the "Old Boy" network.
The professional body should be encouraging their members to meet the appropriate standards to offer specialised advice in a specialist area.
The body should be endorsing regulatory efforts to protect consumers rather than seeking special treatment for their members.
There is no evidence of any reason for an exemption.

No exemptions, no exception!
On 29 February 2016 at 11:18 am dcwhyte said:
Here we go again! A favoured lobby group makes some specious arguments against compliance, and the regulators buy into the bull-dust!
The same remarks apply to both lawyers and accountants - there is nothing in their training or in their professional supervision that qualifies them to advise on investment or insurance issues.
"There is no evidence of consumer harm" - exactly how does anyone establish this?
Alternatively, how would the regulator suggest that an interested party gather such evidence?
"Chartered accountants are recognised by consumers as professionals...." I wonder what the clients of David Ross would make of that statement?
According to the CA's Disciplinary Committee webpage there were over a dozen members called to account in 2015 - with a few "names withheld".
This may well point to an effective governance of the professional accountancy standards, but does not address the specific competency questions around investment and insurance.
While most sensible accountants who wish to offer investment/insurance advice have gone down the path of obtaining the necessary qualification to offer such advice, the requirement for an exemption smacks of the "Old Boy" network.
The professional body should be encouraging their members to meet the appropriate standards to offer specialised advice in a specialist area.
The body should be endorsing regulatory efforts to protect consumers rather than seeking special treatment for their members.
There is no evidence of any reason for an exemption.

No exemptions, no exception!
On 29 February 2016 at 11:51 am Dirty Harry said:
David Ross.
I wrest my case.
On 29 February 2016 at 3:56 pm Pragmatic said:
I expect more from the Regulator, and - whilst I'm not surprised at the Accounting & Legal fraternity protecting a lucritive side-business - I'll be dissappointed if this loophole is not closed.

To MBIE: I would strongly encourage you to adopt a common sense approach towards this issue, rather than the reported "she'll be right" approach. The alternative will be further industry contamination by a bunch of well meaning (and generally poorly informed) periphials, with the consumer really the only victim

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