THE heads of Australia’s six leading professional associations for financial advisers have expressed disappointment in the timing of the Federal Government’s decision today to not proceed with code monitoring, just a month before all financial advisers are due to have registered.

The associations have urged the government to work with them on a new disciplinary system for financial advisers.

As a result of the Federal Government’s announcement, the associations have withdrawn their application to have Code Monitoring Australia (CMA) approved as a nation-wide monitoring and enforcement scheme for financial advisers.

The associations' official statement said: "Given the work that has been undertaken and costs incurred in good faith, we are disappointed that Code Monitoring Australia won’t proceed. We offered an effective disciplinary model which met ASIC’s requirements and was ready to go on 1 January 2020.

“Today’s announcement by the Government makes it unreasonable for us to proceed with CMA. We need to avoid adding complexity, further duplication and cost to the regulation of financial advice.

“We are committed to ensuring that appropriate disciplinary procedures and consumer protections are in place, but are disappointed that the announcement is so late in the development process.

“We remain committed to working with the Government to ensure the enforcement of the FASEA Code of Ethics, which protects consumers and promotes high standards among financial advisers.”

About Code Monitoring Australia and the FASEA Code
CMA was established with the joint support of the Financial Planning Association of Australia (FPA), the Association of Financial Advisers (AFA), the Boutique Financial Planners (BFP), the Financial Services Institute of Australasia (FINSIA), the Self-Managed Super Fund Association (SMSF Association), and the Stockbrokers And Financial Advisers Association of Australia (SAFAA). The Corporations Amendment (Professional Standards of Financial Advisers) Act 2017 (Cth) established education, training, and ethical standards for licensed financial advisers in Australia. The Financial Adviser Standards and Ethics Authority (FASEA) has been mandated by the Australian Federal Government to implement these standards including annual continuous professional development and mandatory Code of Ethics requirements.

https://www.fasea.gov.au/

https://www.fasea.gov.au/code-of-ethics/

https://asic.gov.au/

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LAST WEEK, Australian small businesses with 19 employees or less, were required by law to report using the new digital Single Touch Payroll (STP) reporting system - however around a third of small employers are yet to start reporting or notify the ATO they need more time to start.

STP requires employers to electronically send payroll information including wages, salary payments and superannuation to the Australian Taxation Office (ATO), at the same time as their usual pay run.

Many businesses can report from their existing accounting software if it’s STP-enabled but if it is not, then with some preparation employers can implement the new payroll scheme with minimal interruption.

Chartered Accountants Australia and New Zealand (CA ANZ) wants to remind small businesses to make the switch to avoid any unwanted calls from the ATO.

“According to the ATO, almost 400,000 small businesses have signed up to STP and around 100,000 have applied for quarterly reporting, been granted additional time to start reporting or are covered by the one year extension for closely held employees,” CA ANZ tax leader Michael Croker said.

“Given there are around 750,000 small businesses in Australia that employ people, many are yet to make the move.

“Small business employers who haven’t signed up for STP, or have not obtained a deferral or concession, can expect to be contacted by the ATO.

"The ATO won’t just go from nice guy to tough guy, but the dial will move in a way that triggers more direct engagement. 

"There is power in the legislation to penalise businesses who don’t make the switch which the ATO can use but currently the ATO is identifying and working with businesses to help them adopt STP.”

The intention of STP is to create transparency and guarantee employers are meeting their payroll obligations – particularly in relation to superannuation. 

“This scheme gives the ATO access to businesses real-time payments, meaning any underpaid entitlements, such as superannuation, will be identified,” Mr Croker said.

“Business who haven’t been meeting their employer payroll responsibilities can be identified and should expect to be contacted by the ATO.”

Businesses that have made innocent errors in their STP reporting can expect a light touch in this first year of reporting as the ATO has indicated that penalties will not be applied

“If your current payroll software hasn't been STP- enabled, or you don't use a payroll software, it’s a good idea to talk to your local Chartered Accountant about options that would best suit your business needs,” Mr Croker said.

https://www.ato.gov.au/Business/Single-Touch-Payroll/

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THE LIFE insurance industry recognises that to become a sector the community trusts, the industry must commit to supporting the professionalism of its people. That is the position of the Australian and New Zealand Institute of Insurance & Finance (ANZIIF).

The ANZIIFand the Life Insurance Professional Standards Working Group (LIPSWG), whose membership is comprised of AIA Australia, AMP Life, BT Life Insurance, ClearView, MLC Life Insurance, TAL Life Limited and Zurich, have signed a Memorandum of Understanding to work together for the benefit of the industry to:

• establish the Professional Standards Framework;
• undertake a demographic survey; and
• develop an approach to assess current knowledge defined within the agreed framework.

In a statement, the ANZIIF said the collaboration and dialogue between key insurance leaders would "significantly contribute to the professional standards across the life industry".

The findings from the Hayne Royal Commission and PJC report revealed the need to place emphasis and investment into building the professional skills of people in life insurance.

ANZIIF has consulted broadly across the retail life industry, reinsurers, regulatory authorities and associations to ensure broad based support for this collaborative project. The Australasian Life Underwriting and Claims Association (ALUCA) has also been engaged and is contributing to the project. 

The LIPSWG members believe this program will improve the professionalism of the life insurance industry; build and improve community confidence in life insurance; create a significantly better experience for customers. The project has the added benefit of creating cultural change and driving strategy to attract and retain career employees. 

AMP Life CEO and ANZIIF board president, Megan Beer said, "Becoming more trustworthy requires us to demonstrate competence.  Our commitment to lifting professionalism in our industry starts with key roles that deliver value to our customers. Defining what it means to be an insurance professional is fundamental to the future of our industry and working collaboratively is the way we will achieve meaningful change."

AIA CEO Damien Mu said, "The establishment of Life Industry Professional Standards will ensure that life insurance professionals have a high level of well-rounded knowledge, with a focus on good customer outcomes which we believe will increase consumer confidence."

ANZIIF CEO Prue Willsford shared her enthusiasm of this announcement.

"Over the last two years, we have established a framework to drive this major collaboration in the life industry around professional standards," Ms Willsford said. "I’m proud to collaborate with the seven companies who represent 95 percent of the gross written premium in the life industry in this significant project."

ANZIIF will be conducting two major studies. First, a demographic survey across the entire industry to understand what level of background and skills people bring to the industry. The second will be to develop a knowledge based assessment within the agreed framework.

"We will lead the collaborative project to establish a Professional Standards Framework which will determine the different job families, and the competencies required to fulfil job roles at every level of experience," Ms Willsford said. "The significant undertaking will assist Life CEO’s and leaders to create a comprehensive roadmap to understand the investment required to build professional skills within their business."

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THE Australian Small Business and Family Enterprise Ombudsman Kate Carnell has urged small business owners to take a moment to consider their wellbeing ahead of World Mental Health Day 2019 tomorrow.

“This year’s World Mental Health Day focus is on suicide prevention, with someone in the world sadly taking their own life every 40 seconds,” Ms Carnell said.

“Organisers have asked everyone to take 40 seconds of action to raise awareness about mental health.

“Mental health is a serious issue for Australia’s small business community, with a new MYOB report revealing 56 percent of small business owners admit that running their business has directly brought on feelings of anxiety or depression," Ms Carnell said.

“48 percent of those small business owners reported their anxiety was largely caused by financial and cash flow concerns.

“Many small business owners may not be aware that the very worries that are keeping them up at night – such as cash flow, customer demands or paying suppliers – can actually cause high levels of psychological distress and have serious impacts on their mental and physical health," she said.

“It makes good business sense to invest in a mentally healthy workplace. Research by Pricewaterhouse Coopers has shown that every dollar spent on creating a mentally healthy workplace results on a positive return on investment of $2.30.”

www.asbfeo.gov.au

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THE House of Representatives Standing Committee on Economics will scrutinise the superannuation sector over two days of hearings in Canberra on November 21 and 22, 2019, as part of its ongoing review of the four major banks and other financial institutions.

The chair of the committee, Tim Wilson MP, said, "These hearings are an important part of the committee’s scrutiny of the financial sector.

"As the superannuation system is a significant mechanism enabling Australians to support themselves in retirement, it is crucial that the superannuation sector is operating effectively, fairly and to the benefit of fund members," Mr Wilson said.

The committee’s examination of the groups will include monitoring the sector’s progress on implementing relevant recommendations from the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.

Public hearing details

Date: Thursday, 21 November 2019
Time: 9.15am to 5pm
Location: Committee Room 2R1, Parliament House, Canberra

9.15am – AustralianSuper
10.45am – Break
11am – IOOF
12.30pm – Break
1.30pm – Suncorp
2.15pm – Q Super
3pm – Nulis Nominees Australia
4pm – REST and Host-Plus
5pm – Adjournment

Date: Friday, 22 November 2019
Time: 9.15am to 3.30pm
Location: Committee Room 2R1, Parliament House, Canberra

9.15am – Industry Super Australia
10.30am – Break
10.45am – IFM Investors 
12pm – Break
1pm – Association of Superannuation Funds of Australia
2pm – AMP Super (AMP Group)
3.30pm – Adjournment

The hearings will be broadcast live at aph.gov.au/live.

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THE Joint Standing Committee on Treaties has today tabled a report on Australia’s proposed free trade agreements with Indonesia and Hong Kong.

Committee chair Dave Sharma MP stated that at this time of growing global economic uncertainty and mounting trade tensions, countries like Australia needed to stand up for the principle of free trade and shore up the foundations of the global trading system.

“While dealing with different issues and contexts, these free trade agreements will create new opportunities for Australian-owned businesses in the region, and help bolster the global trading system at a time of growing uncertainty,” Mr Sharma said.

"Indonesia has a population of 270 million people, a solidly growing economy, and is on track to become one of the world’s most significant economies in the years ahead.

"The agreement with Indonesia has the potential to transform our economic relationship, and lift it to a level that better reflects the strategic importance of our countries to one another.

"Australian grain and citrus growers, cattle producers, mining equipment providers and vocational education suppliers all stand to benefit from improved access to the Indonesian market which the agreement provides," Mr Sharma said.

"But beyond this, and as the name implies, the Indonesia Australia Comprehensive Economic Partnership Agreement goes on to lay the foundations for a comprehensive economic partnership with our largest northern neighbour.

"It will support Indonesia’s own economic growth, by supporting Indonesian capacity in key areas, and position Australia as a partner of choice. It will improve the business and investment environment. It will provide a vehicle to tackle emerging issues in trade such as non-tariff and regulatory barriers, the digital economy, competition policy, transparency and telecommunications cables," he said.

"Indonesia is one of Australia’s highest priority relationships, and this agreement will help grow our ties in a part of the relationship that has been historically underdone.

"Our economic and trading relationship with Hong Kong, one of Asia’s most open economies, is already well-established and advanced," Mr Sharma said. "In 2018, Hong Kong was Australia’s 12th largest trading partner overall, with total two-way trade in goods and services worth $17.8 billion.

"The Australia Hong Kong Free Trade Agreement largely codifies existing trade and market access arrangements, providing certainty into the future.

"It also modernises the treatment regime for foreign investors, making investor state dispute settlement mechanisms more transparent and more constrained, and improving safeguards for governments wishing to adopt legitimate public policy measures in areas such as tobacco control.

"In considering this agreement, JSCOT heard from witnesses about the ongoing civil disturbances and political instability in Hong Kong," Mr Sharma said. "The committee supports a peaceful resolution of these issues, within the 'one country, two systems' framework and Hong Kong’s institutions.

"The committee recognises that the preservation of Hong Kong’s unique status under the Basic Law, under which it enjoys a high measure of autonomy, is in Australia’s national interest, and views ratification of the agreement as a means of supporting this unique status," Mr Sharma said.

The committee has recommended ratification of both treaties.

More information about this committee is on its website.

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BUILDING activity shrank by 5.5 percent during the June 2019 quarter to record its weakest result in two years with both resident and commercial activity moving lower, according to Master Builders Australia’s chief economist Shane Garrett.                                                  

“Today’s figures from the ABS show that the volume of residential building dropped by 4.5 percent during the June 2019 quarter with commercial building contracting by 7.2 percdent over the same period. However, the forward-looking approvals data published last week suggest that the short-term prospects for commercial building are still quite favourable,” Mr Garrett said. 

“Up until recent times, commercial building had been one of the economy’s strong performers but today’s figures indicate activity here too has started to falter,” Mr Garrett said. 

“Economic growth has been hurt by the decline in residential building activity which has been underway since late 2016. 

“Domestic demand in the economy is lacking in energy at the current time which is why the onus lies so heavily on government to get things moving,” Mr Garrett said. 

“Speeding up the roll out of already-committed infrastructure projects is the most obvious way to kick start demand in the economy. All levels of government need to work more closely together to help achieve this,” he said. 

“Once new infrastructure is in place, it can spark off activity in other parts of the economy by enhancing the economic viability of potential residential and commercial building projects. 

“Faster infrastructure delivery is the key to unlocking recovery in our building industry,” Mr Garrett said. 

www.masterbuilders.com.au

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ALMOST HALF of Australian small business owners feel stressed or anxious about work every day, yet most don’t seek help, according to a recent survey by Yellow.

Yellow surveyed 100 small business customers across the country from a wide range of sectors and found 40 percent of respondents are stressed about work, but an alarming 72 percent do not seek any help. This was most prevalent among small business operators aged 51 or above.

The survey investigated the impact of running a small business on the mental wellness of SMB owners, and how they cope with it.

Three quarters of the survey respondents have been running their business for more than 10 years, a tell-tale sign that managing work-related stress does not come any easier for seasoned SMB operators.

Managing business finances (32%), juggling multiple responsibilities (26%) and no work-life balance (16%) were cited as the top stressors. Half of those surveyed say they work more than nine hours per day – significantly higher than the daily average of 7.6 working hours.

One in five say not only their productivity takes a hit as a result of their work anxiety, but they also feel the brunt of it on their personal relationships. Despite this, 22 percent cite not wanting to be a burden to others as a deterrence from seeking help, while 14 percent say they are not sure where or who to seek help from.

“Running your own business can be hugely rewarding but it comes with high pressure and often small business owners find it hard to switch off from work after hours,” Yellow executive general manager James Ciuffetelli said.

“Having worked with Australian small businesses for more than four decades, we understand the challenges that come with being a small business owner. With Mental Health Week raising awareness of the issue this week, we want to remind all small business operators to take the first step of reaching out to someone – whether that’s a friend, a partner or a family member – and start a conversation about their mental wellbeing.” 

Yellow has produced a mental health handbook for small business owners in partnership with RUOK?, which is available for download here.

About Yellow

Yellow helps everyday Australians find, choose and connect with the best local businesses Australia wide. Yellow is the longest standing business directory, helping consumers solve their everyday life admin pressure and get things done. As the digital marketing experts, Yellow also champions Australian small to medium businesses. Yellow has an extensive range of digital marketing solutions including Yellow SEM, Yellow SEO, Yellow Digital Display, Yellow Social Ads, Yellow Websites and Pocket Office. Yellow is a division of Sensis – one of Australia’s leading marketing services companies. Other Sensis brands include White Pages, Sensis Data Solutions and Skip. Consumers use www.yellowpages.com.au. Businesses use www.yellow.com.au

About Sensis

Sensis helps Australians connect and engage through its leading platforms. Sensis helps create and manage valuable connections via itsdigital consumer businesses (Yellow, White Pages, True Local, Whereis and Skip), search engine marketing and optimisation services, website products, social, data and mapping solutions, and through its digital agency Found. Sensis is also Australia’s largest print directory publisher including the Yellow Pages and White Pages. www.sensis.com.au

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