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We have had many discussions with people interested in applying for a licence. The discussions always come down to the same issues; cost, time and expertise.
Hiring a consultant can represent a large outlay of funds for a new business. Doing it yourself can definitely be the cheaper option, if done right. When doing it yourself you need to be very familiar with ASIC’s requirements. If you run into trouble half way through the application or get the wrong licence authorisations, a consultant’s fees may be similar to help you as it would have been for them to do the application from start to finish.
If you decide to complete the application yourself, you can save about 100 hours time by purchasing a template compliance manual to tailor to your business. Creating good compliance policies requires a lot of time and expertise. Navigating the Australian Standards, ASIC guidance and financial services legislation can be time consuming.
Applying for a licence, particularly if you haven’t done it before, is fairly time consuming. If you aren’t in a hurry and have the time to read up on what’s involved, doing it yourself can be a great way to become familiar with the requirements and obligations of licensees. A lot of people use consultants because they just don’t have the time to do it themselves. Depending on what agreement is in place with the consultant, an application may only require an initial meeting and few hours reviewing documents. We have a DIY kit for people who want to do it themselves but don’t want to “start from scratch”.
As a financial planner, you’ll be comfortable with technical language. Licence applications can be quite technical and require a lot of information presented in a certain way. Consultants draft application documents frequently and know what needs to be included. The experience they have with applications and ASIC also gives them the ability to spot potential issues with the application and makes them well versed in speaking “ASIC”.
Licensees have certainly got their own licence in the past without help (ASIC’s licensing kit is quite good) and many have used consultants. It’s a personal choice for the applicant which path they choose. Remember help is always available if needed at any stage of the application – even if it’s just paying for a few hours of time prior to submitting your application to ASIC.
Author: Michelle Chasser