THE THREE major professional accounting bodies – CPA Australia, Chartered Accountants Australia and New Zealand (CA ANZ) and the Institute of Public Accountants (IPA) – have joined forces to review the frameworks that regulate how financial and tax advice is provided in Australia.

CPA Australia, CA ANZ and IPA have released a video in which the CEOs of the three bodies call for more efficient regulatory frameworks for advisory services and pledge to work together in advocating for change.

CEO of CA ANZ Rick Ellis said, "The bodies were working together on a broader and more robust solution to the complexity of the current regulatory framework that will enable both businesses and Australians to not only access the advice they need but understand that advice.

“The failures that were revealed from the Banking Royal Commission brought to light the extreme complexity of the current frameworks in financial advice which are not in sync with each other,” Mr Ellis said.

CEO of CPA Australia Andrew Hunter said, "Accounting professionals need the flexibility to talk and engage with their clients – but this is often problematic when that advice falls under multiple regulatory frameworks in the same conversation, or even the same sentence.”

IPA Group CEO Andrew Conway said, "Our shared goal is to reduce the regulatory burden on our members, so we retain financial advisers in the industry.  For the first time in the best part of two decades we are at a risk of creating an advice gap in the market.”

This – coupled with the new education and professional standards under FASEA, the current review of the Tax Practitioners’ Board and the implementation of the recommendations from the Banking Royal Commission – means there is a very real threat of added complexity.

Given the impacts of an ageing population, forced retirement savings, and ongoing concerns around financial literacy, now more than ever Australians need access to affordable, quality advice.

The three bodies have a clear focus to revisit definitions, licensing regimes and to harmonise obligations where members operate under multiple regulatory frameworks to provide the advisory services to their clients.

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BUILDING APPROVALS for new apartments and units leapt by 16.1 percent during the month of September according to new figures out this morning. 

“Momentum in Australia’s housing market appears to be growing with the volume of new home building approvals expanding by some 7.6 percent during September,” Master Builders Australia chief economist Shane Garrett said. 

“Encouragingly, last month’s gain was led by apartments and units. This part of the market had experienced difficulties earlier in the year but the volume of new approvals for high density housing has now notched up two consecutive months of growth.

“Detached house approvals also rose during September albeit at a more modest rate of 2.7 percent. This side of the market does tend to move more smoothly from month to month,” Mr Garrett said. 

“A range of indicators – house prices, lending and now building approvals – all indicate that Australia’s housing market recovery is gaining traction. Housing market conditions have a huge impact on confidence across our economy and today’s figures must be seen as very good news on that front. 

“Commercial building approvals recorded their strongest ever result during August. Not surprisingly, they reverted to more normal levels during September,” Mr Garrett said.

During September, Queensland led the gain in new home building approvals (+19.6%) followed by South Australia (+16.0%). There were more modest increases in Tasmania (+3.4%) and Victoria (+3.3%) during the month. 

Despite the favourable national result, several markets saw new dwelling approvals drop during September including Western Australia (-24.5%), the Northern Territory (-9.3%) and New South Wales (-2.5%).

www.masterbuilders.com.au

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THE Australian Small Business and Family Enterprise Ombudsman Kate Carnell has launched a review of the impact supply chain finance has on the small business and family enterprise sector.

The review will examine the ways in which small and family businesses can use supply chain financing to manage cash flow and fund growth.

It will also look at the products being used by big business to offset extended payment times.

“Supply chain finance is a legitimate and effective tool to free-up cash flow for small and family businesses,” Ms Carnell said.

“However, it is totally unacceptable for big businesses to use supply chain financing arrangements as a replacement for reasonable payment terms being offered, 30 days or less from invoice.

“This review will provide a clearer picture on the range of supply chain finance options available on the market and which industries are using these products.

“More large businesses are offering supply chain finance to small businesses and we are keen to find out what’s driving that," she said.

“The review will investigate whether supply chain finance is being used by big business as a means to stretch out formal payment terms and as a strategy to manipulate the reporting of working capital and cash reserves.”

The full scope of the Review of Supply Chain Financing can be found here.

Small businesses and family enterprises who have had experience with supply chain financing can contribute to the Ombudsman’s review via This email address is being protected from spambots. You need JavaScript enabled to view it.

An interim report is expected to be released by the Ombudsman in March 2020, followed by a full report by the end of April 2020.

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THE Insurance Council of Australia Board (ICA Board) today approved a new General Insurance Code of Practice (Code) after one of the most extensive reviews in the Code’s 25-year history.

The Code sets out standards that are above and beyond legal requirements and aims to meet and anticipate consumer expectations. It has been comprehensively updated and rewritten to further enhance the rights and expectations that insurance customers can have about their relationship with their insurer.

The Code will be formally launched in early 2020. ICA members and other Code participants will start to transition to it from January 1, 2020, with all Code signatories to be compliant by January 1, 2021. All Code signatories will also be required to introduce and implement a publicly available policy to support customers affected by family violence by July 1, 2020.

ICA Board President Richard Enthoven said, "The new Code provides a significant improvement to consumer outcomes in their dealings with insurers, their distributors and their service providers.

“We now have provisions for customers experiencing vulnerability, including a requirement for signatories to have a policy to support people affected by family violence and provisions for customers who are experiencing mental health conditions.  

“The insurance industry has enhanced its financial hardship provisions. The Code also provides enhanced sanction powers to the independent Code Governance Committee for breaches of the Code, and includes a community benefit payment by insurers that commit significant breaches.”

Mr Enthoven said the ICA Board believed the new Code would set the benchmark for self-regulation in Australia and would help the insurance sector strengthen its reputation and relationship with customers, consumer advocates, regulators and governments.

“The new Code of Practice is the result of more than 2½ years of consultation and development,” he said.

“It has been one of the most thorough and wide-reaching reviews and revisions of the Code ever undertaken since the first Code was developed in 1994.

“Though the review process started well before the announcement of the Financial Services Royal Commission, the Code reflects Royal Commission recommendations alongside the Code Review Final Report and reports from a range of stakeholders.

“The ICA Board appreciates the expertise, input and guidance provided by many stakeholders including ICA member companies, the industry’s National Code Committee, consumer representative organisations, the Australian Securities and Investments Commission, legal aid services, the Australian Financial Complaints Authority, the Code Governance Committee and members of the community.”

The new Code will be publicly available from January 2020.

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