There is something magical about writing announcements for new features and unveiling them to an eager audience. Who doesn’t like making their customers happy?
But sometimes we have to write for the opposite reason, when a feature needs to be removed or a service needs to be deprecated. It’s unlikely anyone will delight in this kind of news.
After more than three years of incredibly hard work, we have taken the executive decision to suspend our online Statement of Advice service for the indefinite future. This is not due to any regulatory or compliance issue. It has just proven non-commercial in the current regulatory environment.
A.S.A.P.’s actuarial certificate service will continue and is going from strength to strength
When we launched our digital SMSF advice platform it was on the presumption that licensed advice was compulsory for accountants to arrange before implementing product transactions such as SMSF establishments, rollovers and pension commencements.
Our recent survey of 322 accountants helps to confirm that this view is not shared across the industry and neither ASIC nor the accounting bodies have clarified whether it’s ok to implement transactions after giving tax/compliance advice but not licensed product advice. To us this seems risky but it appears to be a risk that many accountants are forced to take when their clients resist the licensed advice requirement.
We are ending our SMSF Statement of Advice Service from 6 March 2020
From 6 March 2020 we shall cease offering our online SMSF advice service.
As you will no doubt have seen in the media, running a licensed advice business in the current regulatory framework is effectively unworkable cost-effectively. Personal financial advice has become a high-risk, high-cost business – making it uneconomical for many licensed advisers. The joint accounting bodies help to explain why in their video and report on their website. Thousands of advisers are exiting the personal advice sector and all four major banks have exited the personal advice space.
We had hoped the size of the SMSF market, combined with our incredible technology, would mean we can transcend these problems. However, in reality we only receive a few SMSF advice orders per week – which is clearly not a viable business line.
We strongly empathise with accountants, advisers and SMSF trustees who are stuck between ‘no advice’ or the formality of a traditional licensed advice process. A.S.A.P. have hung in there for over 3 years but we can’t justify further investment at this time given the enduring headwinds.
Digital advice / robo-advice
Despite this, we are extremely proud of the technology we have built and its ability to streamline the process to give high quality product advice. The technology we have operated for the past three years works flawlessly albeit without enough revenue. We believe it is easily the best of its kind in balancing quality with efficiency and usability. It strikes a sweet-spot between automation and human involvement. We shall keep our codebase as it may become useful again in the future. (E.g. A larger institution may wish to purchase it to deliver scaled advice services).
What you will need to do
We recommend you download the key documents relating to all Statements of Advice you have ordered from us. Our system will continue to process new orders until 6 March and then just provide read-only access for a limited period. We will provide further instructions on how to download these key documents soon.
Our Actuarial Certificate service remains unchanged and is integrated with both Class Super and BGL. 85% of the 100 accountants who use us say they are likely or extremely likely to recommend our actuarial certificate service to others!
Please don’t hesitate to call me to discuss the licensing regime “post-A.S.A.P.” as we may be able to refer you to more a more traditional advice firm who can continue to assist.
As you know, we are in the process of rebranding from A.S.A.P. to Apricot Actuaries to better reflect our adjusted focus and areas of expertise. We will continue to be active in the SMSF sector with our Actuarial Certificates and soon, Actuarial Certificates Plus.
We partner closely with retirement technology firm 10E24 Pty Ltd and together we have built world leading retirement ‘what-if’ software that a full range of professionals can use with their clients to make confident, informed decisions such as ‘how much do I need to retire?’ or ‘how much can I live on in retirement?’. Because the software is not product specific, the basic version can be used without an AFSL. We will share more about this exciting development next year.
Thank you for your support over the past three and a half years.
We look forward to continuing our relationship but in a different form.
Jim Hennington BComm FIAA DipFP
CEO / Actuary