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CPA Australia Advice is missing from the association’s 2018-21 corporate strategy, pending results from a review into the licensing arm’s viability.
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CPA’s licensing arm missing from corporate strategy
27 June 2018
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9 minute read
The association’s draft corporate strategy, released to members today, promises a focus on the reputation of the CPA brand, the quality of CPA members and advocacy initiatives.
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Former auditor-general Ian McPhee recommended a review into the loss-making CPA Advice, and until that is finalised, the business unit’s forward-looking strategy is on hold.
“The draft corporate strategy covers the operations of the parent company, CPA Australia. The strategy for CPA Australia Advice will be informed by the findings of the review that is currently underway,” a CPA spokesperson told Accountants Daily.
CPA Advice has struggled from its launch in 2015 to attract members, falling hundreds short of its business projections by year end 2017. It’s also reported a combined trading loss of $7.4 million in November last year since inception.
Housing a dealer group under the CPA Australia brand has also posed severe regulatory conflicts for the association.
At the moment, CPA Advice is posing questions about the association’s eligibility as a monitoring body under the federal government’s incoming mandatory education requirements, which apply to accountants who give financial advice.
To comply with the new rules, accountants need to be accredited by a code monitoring body. Monitoring bodies may be professional associations, but they cannot be an Australian Financial Services (AFS) licensee, or an affiliate of a licensee. CPA Advice, a licensee, is a subsidiary of CPA Australia.
If CPA Australia is not recognised as a monitoring body, its members who provide financial advice will need to join another organisation that is approved as a code monitoring body to be compliant.
CPA Advice was also central to the problems the association had with securing a professional standards scheme last year, which provides liability coverage for members in public practice. The Professional Standards Council (PSC) authorises the schemes and was, at the time, concerned by a potential conflict of interest the licensing arm posed.
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