So, it’s nearly 2016. I have no idea where 2015 went, I’m sure its still October! It’s been a solid first full year for Mayflower Consulting; we’ve worked on some great projects, and expanded the team, with Cameron Woods, Senior Communications Consultant joining us in July.
As many people do, I’ve been reviewing what’s worked and what hasn’t in 2015 and thinking about what I’d like for the business and for me personally in 2016.
On the SMSF front, I’ve learnt that lunacy still reigns when it comes the facts and figures.
I’ve seen figures quoted this year that would make anyone’s head spin.. 25% of SMSF monies are in managed funds for instance? According to the ATO*, this stat is more like 13%. So it’s only out by a factor of 2. You wouldn’t want to be relying on that 25% for a business case!
I’ve also been concerned to see that with regards to licencing for accountants, a significant minority are planning to just continue what they’ve been doing, with complete disregard for the law. The accounting profession in Australia is held in high regard, it would be disappointing to say the least to see this tarnished by a belief that "I am my clients’ most trusted advisor and therefore licensing rules don’t or shouldn’t apply to me".
Given that ASIC is (rightly) on the warpath regarding crappy advice, these accountants are playing a very dangerous game. And they will be receiving exactly no sympathy from me when they get caught. There’s some really high quality outfits either assisting Accountants with getting their own license, or offering licensing options for Accountants under their own license. I would urge accountants who are either undecided, or planning to ignore the legislation, to get on with understanding their options and taking action. Don’t leave it to the last minute people!
On a more positive note, I’ve seen the continued rise of genuine interest in the needs and motivations of SMSF trustees, as well as the understanding that this is NOT a homogenous group of people. The UBS/FSC report is an indication of this. As representatives of the big banks and fund managers, there has been a clear acceptance of SMSFs as ‘not going away’, which is a good thing, as it now means we can all get on with making the most of the situation for our individual businesses, without the undermining coming from businesses that have lost out as SMSFs have taken market share from other retirement options.
On a more personal note, a key learning was not to take on too many projects at once. I think I learnt that 3 times.
I also learnt that, while I was hoping to immediately start working with small businesses, big business is where my contacts and prior experience lie. Having said that, Mayflower has worked with some mid-size and boutique businesses in the second half of the year, and I hope we continue to work with a wide range of practices, fund managers, banks and other industry participants. One of the key reasons to start my own business was to never have the same day twice, and that’s certainly been the case so far.
As for 2016, I can’t wait – SMSF is always an exciting and interesting space and I don’t expect 2016 to be any different. Licensing will of course get an enormous amount of airplay and code of ethics for financial planners will also be hotly debated, as it should be. ETFs will continue be a popular topic, but not that popular as an investment choice, similarly robo-advice. Anyone remember when SMAs were going to change the world? I put robo-advice in a similar category – it will certainly have a place in the investment landscape, but it doesn't herald the end of the managed funds industry.
So, many thanks to our clients and associates for a great 2015, and we’ll see you on the other side!
*ATO SMSF stats June 2015
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