Greg Holman

Accounting will be one of the next professions savaged by digital disruption with up to 40 per cent of the work traditionally completed by accountants already being done by cloud-based computer programs and cheap, qualified bookkeepers, according to a confronting new white paper by non-institutionally owned licensee GPS Wealth.

According to the Paper’s author Greg Holman, founder and director of GPS Wealth, accountants are under increasing pressure to demonstrate their point of difference and add value just to maintain their ground. Those who want to gain ground, fend off competitors and achieve sustainable growth must expand their value proposition, beef up their soft skills and team up with the right partners in order to take their businesses to the next level.

“A look at what’s happened in other industries demonstrates that no one can afford to stand still. Digital disruption will destroy accounting practices that are inefficient, inflexible and provide a low level of service,” he said.

“The only way to combat it is to continuously add value, and grow organically by steadily increasing fees in line with increasing value.”

Titled “Melding accounting and advice: How to get future ready in a digital world”, the paper concludes that the best way for accountants to capture growth opportunities and futureproof their business is to offer financial services like insurance, lending, budgeting and cashflow management, strategic advice, retirement planning and estate planning. This can be done a number of different ways such as establishing a joint venture with an established advice firm, via a referral arrangement or by employing a qualified adviser in-house.

Drawing on Holman’s extensive experience helping hundreds of accounting practices expand their client value proposition by adding financial services either internally or through a referral arrangement, the white paper examines the changing role of accountants, the benefits of having a broader, deeper client relationship and the risk of doing nothing.

“Accountants still hold the coveted position of most trusted adviser,” Holman said.

“They can play a more significant role in their clients’ lives and continue to be their primary trusted adviser, potentially in conjunction with a financial planner, by helping them secure a comfortable retirement and financial independence.”

“By doing so, they can become an integral part of their clients’ lives and not only at tax time.” A free copy of GPS Wealth’s white paper Melding accounting and advice: How to get future ready in a digital world is available here.

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Greg Holman

Former BT Select practice, BCB Financial Planning has joined noninstitutionally-owned dealer group GPS Wealth in a move expected to see the rapidly growing Sydney-based practice strike further referral agreements with accounting firms who specifically want to partner with a non-aligned practice.

In May, BCB Financial Planning, affiliated with BCB Accountants and Business Advisors, also entered a formal referral arrangement with accounting and tax specialists J & C Accountants.

According to BCB director Adam Chalk, the group’s decision to switch to GPS Wealth was driven by a desire to partner with a like-minded licensee for the long term and work with a licensee that had the resources, experience and desire to help practices grow.

“GPS has a unique offer. The group’s client-centric advice philosophy is completely aligned to our way of thinking and it’s backed by a suite of effective client engagement, practice management and advice tools, and a team that’s fully committed to doing whatever it takes to help advisers build and run successful businesses,” he said.

“BCB Financial Planning has an extremely compelling proposition for accountants who want to offer professional strategic advice to their clients but importantly, we now have the tools to clearly articulate and demonstrate the value we can deliver. We believe our licensing partnership with GPS Wealth contributed significantly to our new referral relationship with J & C Accountants.”

GPS director Greg Holman said: “BCB Financial Planning is already a very successful financial planning practice and we’re excited to partner with Adam and the team to take the business to the next level”.

“We believe that our awarding-winning client engagement tools, coaching, systems and support will help BCB Financial Planning grow further,” he said.

Mr Chalk, who holds a degree in economics & finance and a Masters in Commerce, joined BCB Accountants and Business Advisors in 2012.

He worked closely with director Rod Burke to launch the group’s financial planning business, which offers strategic advice to the accounting firm’s 2,000 active clients.

“Accounting and financial planning are highly complementary, and BCB’s accounting partners recognised it was important to take a holistic view of a client’s life and situation, not just their tax,” Chalk said.

“GPS Wealth understands the enormous opportunity that accountants have to expand their value proposition and boost client engagement by offering financial services.”

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Greg Holman

Non-institutionally owned financial planning and accounting dealer group, GPS Wealth has launched an automated Statement of Advice (SoA) tool, designed to slash the time it takes accountants to produce a range of advice documents by around 80 per cent.

The program, which is exclusively available to GPS Wealth’s limited authorised representatives, produces clear, concise and compliant SoAs in five key areas: establishing a self-managed superannuation fund (SMSF); borrowing to invest in real estate under a Limited Recourse Borrowing Arrangement (LBRA); implementing a transition to retirement strategy; concessional and non-concessional super contribution strategies; and reserving strategies.

It also features corresponding guidelines and check lists to help accountants confidently meet their responsibilities under the regulator’s new licensing regime. A final step in the process is the creation of a strategy paper for clients to sign, confirming that they understand and accept the advice they’ve been given.

According to Greg Holman, Certified Practising Accountant and co-founder of GPS Wealth, a complex SOA which may have previously taken five hours to prepare can now be delivered in 30-45 minutes, which will significantly lift practice efficiency, lower costs and free accountants to spend more time infront of clients.

“We’re committed to partnering with accountants as they adjust to the removal of the accountants’ exemption and navigate the new licensing regime, which is why we developed a tool to help them meet their obligations while increasing their productivity, profitability and growth potential,” he said.

“Our focus continues to be working with professional accounting and advisory firms which specialise in SMSF advice by providing them with a turnkey licensing solution that includes coaching, mentoring and client engagement tools in addition to more traditional dealer services.”

GPS Wealth is running a series of workshops and webinars over the next few weeks to coach accountants on how to use the SoA tool.

It continues to run professional development courses to help practitioners understand their licensing needs and requirements under the government’s new regulatory framework, and build their skills and competency in key knowledge areas including self-managed super, insurance, lending and strategic advice.

“With ASIC’s deadline less than three months away, and the regulator recently reaffirming that it won’t be offering an extension, accountants urgently need to lock in their licensing arrangements,” Holman said.

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Greg Holman

Digital disruption is transforming the accounting industry, scaling back the traditional “hackwork” done by practitioners and will ultimately drive an increasing number to get qualified and licensed to provide a broad range of financial services in order to stay relevant and survive, according to Certified Practising Accountant Greg Holman.

Holman, co-founder of GPS Wealth, said accountants had little choice but to get licensed given their role was rapidly evolving to include helping clients protect their assets, grow business revenue, and build their wealth in addition to standard tax and structuring advice.

“The hackwork traditionally done by accountants around preparing and lodging BAS and tax returns is increasingly being done in-house by bookkeepers using cloud-based accounting software like Xero and MYOB, which means accountants must expand their value proposition in order to combat digital disruption and build sustainable businesses,” he said.

“In the future, the most valued and valuable practices will be those that not only help clients legally minimise their tax but help them to protect their assets using different company and trust structures; grow business revenue and profitability; and maximise their wealth.”

Mr Holman said the first step for accountants who wanted to build a modern, streamlined business was to become qualified and licensed to provide a range of financial services.

He cited the imminent removal of the accountants’ exemption and the introduction of the government’s new licensing regime on July 1, 2016, as an opportunity for accountants to expand their value proposition and future-proof their businesses.

“Whether accountants move quickly to become qualified and licensed to provide advice, spurred by regulatory reform, or choose to act later, forced by digital disruptive technologies, it’s highly likely many more accountants will conclude that they must expand their value proposition and diversify their revenue in order to hang onto existing clients and win new ones,” he said.

In the last 10 months, over 180 accountants and financial advisers have attended GPS Wealth’s professional development courses, which help practitioners to better understand their licensing needs and requirements under the government’s new regulatory framework, and build their skills and competency in key knowledge areas including self-managed super, insurance, lending and strategic advice.

The courses also highlight the enormous opportunity available to accountants. Around 125 practitioners have applied for a limited authority with GPS Wealth. That number is set to rise ahead of the removal of the accountants’ exemption on July 1.

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Acumon Accountants and Business Advisors, which has 14 staff in two locations in Newcastle, is the 28th business to join GPS Wealth this year with demand growing for well-resourced, noninstitutionally owned licensees, according to GPS Wealth co-founder and director, Greg Holman.

“A growing number of accountants are following the lead of practices like Acumon and offering their clients more than tax and accounting services,” he said.

“They’re looking to become a one-stop-shop and look after their clients’ total financial needs.”

Scott Padgett, Acumon financial adviser said the firm decided to partner with GPS Wealth after a thorough due diligence process which began in June.

“GPS Wealth’s client-first culture and philosophy around ‘exciting life, boring money, not the other way around’ really resonated with us and suited the type of clients we look after which are mainly small business owners, medium-to-high income earners and self-managed superannuation fund investors who want to be smart with their money and build a solid retirement nest egg,” he said.

“A major priority for us was the ability to engage with our clients on a deeper level and GPS Wealth has a range of effective client engagement tools which allows us to sit down with clients, give them a quick overview of their position, show them their progress and clearly articulate the value we add.”

Acumon was an early mover into financial planning. In addition to providing tax and accounting services, it started offering holistic advice to clients in the late 1990s. The firm’s principals Scott Atkins and Christian Tapp wanted to help clients make smart financial decisions, better manage their wealth and improve their financial position.

Holman said Acumon was an example of a modern accounting practice which was adding greater value and making a real difference in their clients’ lives.

“There’s an enormous opportunity for accounting practices to have a broader and deeper relationship with clients while boosting their revenue and increasing the value of their business by introducing financial services,” Holman said.

“With the imminent removal of the accountants’ exemption, there’s never been a better time for accountants to explore their options. An established, independently-owned licensee can help them determine the best way for them to take the leap and progress at their own pace.”

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Experienced accountant and co-founder of GPS Wealth Greg Holman said accountants can slowly move into financial planning or accelerate the process and start offering advice in just 90 days by partnering with a well-resourced and experienced licensee.

“There’s a misconception that accountants have to offer comprehensive investment advice from the outset but many start small with life insurance and lending before gradually expanding into other areas of wealth management such as holistic strategic advice and estate planning,” he said. “It all depends on the individual practice and their clients’ needs.”

Holman said there were many different ways for accountants to introduce financial services to clients including hiring a qualified professional adviser in house or entering a joint referral relationship with an established advice business and refer existing clients to the new entity.

He added that it was often simpler for an accounting firm to initially introduce financial services on a referral basis which can speed up the process and minimise expenses.

GPS Wealth, which was established by Holman and Rob McGregor, is a specialist financial services dealer group which currently provides licensing and compliance services to over 100 financial advisers and 70 accountancy firms nationally.

In the past 12 months alone, over 49 accounting firms have gained a limited authority from GPS Wealth with more than 104 accountants attending the group’s two-day RG 146 courses.

Holman said the benefits of combining traditional accounting and financial advice weren’t only financial but allowed accountants to satisfy their duty of care to clients by raising awareness about their potential need for life insurance, income protection and TPD cover.

It also enabled accountants to put a fence around their clients and remove or reduce the need for them to go elsewhere for advice.

“In an increasingly competitive environment, accountants who can provide more than tax advice and accounting services but a complete, integrated wealth management solution under one roof will become indispensable,” he said.

“Accountants have nothing to lose and a lot to gain by expanding into financial services, provided they do it right.” For more informat

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GPS Wealth has two licensing offers for accountants: a limited authority and a full authority. A limited authority has been the most popular option to date.

Certified Practising Accountant and co-founder of GPS Wealth, Greg Holman warned accountants not to leave it too late before becoming licensed and gaining any additional qualifications, given the removal of the accountants’ exemption was less than a year away.

“Demand for RG 146 courses is already ramping up and there’ll be an explosion of accountants looking to become licenced for the first time, ahead of July 1, 2016,” Holman said.

“Accountants who get licensed early can get a big jump on their competitors and demonstrate that they are a true leader in the accounting profession.”

To keep up with the demand, GPS Wealth is doubling the number of RG 146 courses it offers. From August, the group will run two courses per month. Courses cover the three key areas: generic knowledge, superannuation, and self-managed superannuation.

“Accountants are busy so they like the fact that they can knock over the RG 146 course in an intensive two-day workshop and have an enjoyable learning experience in the process,” Holman said.

In addition to the RG 146 courses, GPS Wealth offers an induction program which details the regulatory compliance framework and what will be required of accountants from July 1, 2016. The program also examines the financial planning opportunity and the various, practical options for accountants to offer comprehensive wealth management advice to their clients.

“The new licensing requirements should be seen by accountants as a tremendous opportunity to expand their service offer, provide a more holistic advice proposition, diversify and lift their revenue, and boost the valuation of their practices,” Holman said.

“A good quality adviser and accountant working together is a very powerful proposition for the client and will deliver improved outcomes. Accountants who partner with an independently-owned dealer group and/or suitably qualified adviser may also derive a significant increase in revenue.”

GPS Wealth currently provides licensing and dealer services to over 100 financial advisers and 70 accountancy firms nationally. It was recently named 2015 Financial Planning Licensee of the Year by independent research and consulting firm, CoreData.

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Grahame Evans

Independently-owned dealer group GPS Wealth has slashed investment fees in half by implementing a Managed Discretionary Account (MDA) solution and turning its back on expensive master trusts and wrap platforms.

New clients of GPS Wealth pay an average investment management fee of between 0.6 and 0.8 per cent of assets under advice compared to fees of up to 1.5 per cent previously, according to GPS Wealth managing director, Grahame Evans.

The group also expects to transition around 60 per cent of existing funds under advice into a MDA structure over the next couple of years.

“The MDA is only for new money at this stage but we’ll be seriously considering the service for existing clients as part of the review process,” Evans said.

“Platforms and managed funds are still very expensive and inflexible, and our philosophy is to add value through asset allocation and by keeping fees down and preventing clients from making silly, emotional investment decisions.”

“The future of financial planning is one where investments are held in the investor’s name, costs are minimised by using passive investments where suitable and advisers better educate their clients about behavioural finance.”

Established in February 2012 by former PIS advisers, Greg Holman and Rob McGregor, GPS Wealth now has 32 practices and over 50 financial advisers across Queensland and New South Wales.

Evans, formerly general manager of PIS, joined the group last year. He said the managed account structure allowed the group to build tailored direct portfolios based on clients’ individual objectives and tax situation.

GPS Wealth signed a deal with specialist MDA operator, managedaccounts.com.au in May 2013, after a rigorous search. The group spent six months implementing the service, which involved establishing an investment committee, investment charter and a new risk management framework.

Evans said the MDA solution underpinned the group’s investment philosophy and mantra of “Exciting life, boring money”.

David Heather, chief executive of managedaccounts.com.au said legislative and structural changes to the financial planning industry were driving many advice businesses to find a more efficient investment and administration solution.

“A managed account solution can deliver many benefits to advice businesses, advisers and clients,” Mr Heather said.

“Advice businesses can centrally manage and implement direct portfolios that and advisers can focus on delivering portfolio solutions that meet their clients’ personal needs and objectives without the need to produce a Record of Advice for each change to the portfolio. There’s less administration and paperwork and more time in front of clients.”

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