A SURVEY of more than 600 Australian and 240 New Zealand business owners conducted by an accountancy, financial planning and law association has discovered that accountants are the most trusted advisers when it comes to business advice. The MSI Global Alliance March 2011 survey scanned a range of business and personal financial advice areas, where participants were able to select their lawyer, accountant, bank, business coach or financial planner.
While much has been written about the lack of professionalism of financial planners, participants rated them as the most trusted source of retirement planning advice (40 per cent) with accountants following closely behind on 37 per cent. This rated accountants highly despite the fact individual accountants are not allowed to offer investment advice to clients.
The banks, on the other hand, were harshly rated with only 10 per cent of participants agreeing that they are the most trusted source of advice when it comes to business finance and retirement planning. It also asked participants to comment on how each category of adviser could improve.
• Do not understand small and medium business
• Aim to make as much as possible in penalty fees
• Do not want a relationship with SMEs
• Fees on overseas fund transfers are ‘daylight robbery’ and not warranted
• Faster response times required since banks are very slow in responding to calls if at all
• Enable clients to set automatic transfers from one account to another to avoid overdraft situations and penalty fees
• Focus on banking, rather than constantly trying to up-sell other financial products
• Train relationship managers to understand SMEs so that they can proactively advise on lending
• In advice terms, too focused on past performance, not the future
• Do not like to leave their offices
• Partners in firms can be inaccessible
• Don’t charge for face-to-face meetings. It stops clients going to their accountant for advice and disables a proactive client-adviser relationship
• Visit clients in their offices. The fees will flow.
• Focus on assisting with forward planning and business strategy rather than being retrospective
• Fees always end up being higher than quoted
• ‘Legalese’ is difficult to understand and lawyers do not compensate their language for clients
• Estimate the work to be done and associated fees more clearly upfront
• Communicate immediately with clients if additional fees will need to be charged
• Breakdown fees charged more clearly
• Talk in a language that is easy to understand
• Be more proactive and instigate client meetings on matters such as estate planning
• Lack of formal qualification/credibility
• Rely on self-help books more than genuine experience with business
• An ‘institute’ is required that can regulate and accredit business coaches
• Focus more on coaching budgeting/savings planning
• Still charge commission, dressed up as a ‘percentage of funds under advice’
• There is no uniform qualification for financial planners, reducing their credibility
• Push clients into funds from which they receive the highest commission
• Charge a dollar based fee-for-service
• Clearer analysis and distribution of super fund performance compared with other funds
• Clients would consider performance fees when performance is better than market averages
• Be transparent and offer more individualised recommendations than managed portfolios from other financial institutions
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