ASIC focusing on Accountants. What you need to know.

July, 2013

Accountants’ exemption

ASIC has recently been reviewing SMSF files from ‘recognised accountants’ who are exempt from holding an Australian Financial Services Licence (AFSL). In some cases, ASIC did not see strict compliance with the exemption and is renewing its focus on accountants with a view to taking action against non-compliant accountants.

For example, if an accountant makes a recommendation that an investor switch their superannuation from an APRA-regulated fund to an SMSF, the exemption will not apply and the accountant will require an AFSL.

Accountants who provide financial services outside the current exemption may attract a penalty of $34,000, a two-year term of imprisonment, or both.

Accountants’ exemption being phased out and replaced with a limited AFSL

The accountants’ exemption will be removed from 1 July 2016 and accountants who wish to continue giving advice to their clients about SMSFs will need to obtain a new limited accountants’ licence[1]. This limited licence will allow accountants to provide a broader range of advice than they are able to do now including making a recommendation to establish an SMSF, to rollover balances from or cease contributions to APRA-regulated funds and advising clients in relation to classes of products in which to invest.

Accountants can apply for a limited AFSL from 1 July 2013

Accountants who apply for a limited licence from 1 July 2013 can take advantage of transitional arrangements under which it will be easier to satisfy ASIC’s requirements for obtaining an AFSL.

‘Recognised accountants’ will only need to satisfy ASIC that they have appropriate knowledge of the areas in which they propose to provide advice. This is important because ASIC is proposing increased qualification and training requirements to persons providing financial advice or persons who change their financial advice activities from 1 July 2015.

A ‘recognised accountant’ is a person who holds a practising certificate issued by:

Importantly, accountants who apply for a limited AFSL under the transitional arrangements will not need to demonstrate that they have relevant experience in the areas in which they propose to provide advice. This is a temporary departure from the current AFSL regime under which demonstrating an applicant’s relevant experience is a significant consideration for ASIC in determining whether to grant an AFSL.

What to do now

If your practice involves providing your clients with advice in relation to the establishment, and investment activities, of SMSFs we recommend that you consider taking advantage of the transitional arrangements currently available to accountants who apply for a limited AFSL. The alternative is to apply for or operate under a full AFSL.With our extensive expertise in licensing, knowledge of ASIC guidance and previous experience at the regulator, Mills Oakley is well placed to assist you with your decision about whether to apply for a limited AFSL or a full AFSL. We can provide you with advice about tailoring your AFSL for your business.

When you make the important decision to apply for a limited or full AFS licence, we can also assist you with preparing your application, assessing the competence of persons to be nominated as your responsible managers, preparing your compliance frameworks,  and liaising with ASIC during the application process.

Please note that this legal update is a brief summary only and is general in nature.  The proposed law in this area is complex.  Always seek specific advice from Mills Oakley in respect of your particular circumstances.  

Contact Mills Oakley

If you require any further assistance, please contact:


Mark Bland| Partner

T: +61 3 9605 0832



[1] Corporations Amendment Regulations 2013 (No. 3).

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