AFA News 25 June 2020. On 12 June 2020, ASIC issued a draft Cost Recovery Implementation Statement for 2019/20, which sets out the proposed ASIC Levy for the 2019/20 financial year, which would normally be invoiced in January 2021.
The estimated cost is $1,500 per licensee plus $1,571 per adviser on the Financial Adviser Register at 30 June 2020. The amount per adviser, reflects a significant increase and compares with $934 for 2017/18 and $1,142 for 2018/19. The total budget at ASIC for the personal advice to retail clients sector has increased from $26m in 2017/18, to $33m in 2018/19 and now $40m in 2019/20. Other fees might also apply to licensees including the $787 per licensee for insurance product distributors.
ASIC will be spending $12.3m on enforcement in the personal advice to retail clients sector and $7.5m on surveillance.
The AFA will have the opportunity to make a submission to ASIC on this by 24 July 2020, however we will certainly express disappointment at the scale of the increase, particularly during the COVID 19 crisis. A key reason for the increase in the per adviser rate ($1,571) is the declining number of financial advisers, and we would have expected a reduction in total costs at ASIC, to reflect this decline in adviser numbers. We are also likely to raise a concern about the comparison with licensees who provide personal advice to wholesale clients only, who will each pay only $155 for the year.
We welcome feedback from members on the 2019/20 ASIC funding levy by email to firstname.lastname@example.org.