The pitch to CPAs is familiar: Why limit your practice revenue to the number of billable hours in the day, when the income potential from leveraging your client base for wealth advisory services is, in theory at least, unlimited? Moreover, the business itself may be much more intellectually stimulating than routine tax and accounting work, not to mention critical to the long-term financial well-being of your clients. CPAs appear as receptive as ever to the lure of offering personal financial planning services. But a number of broker/dealer firms, especially those that specifically target CPAs, far from passively waiting for motivated accountants to affiliate, are busy upgrading their services and tools to enable CPAs to achieve success as financial planners. Why are CPAs such attractive recruits for broker/dealers? Michael Busch, CPA, CFP and president of Vogel Financial Advisors in Dallas, believes that CPAs’ traditional appeal for broker/dealers is their perennial survey ranking as the “most trusted” financial advisor. Also, as the ongoing trend in financial planning towards asset-based fee structures continues to strengthen, and as regulators seek to confer fiduciary status on advisors receiving compensation on that basis, CPAs are viewed as a perfect fit. “CPAs are more process-oriented than product-oriented,” Busch said. “CPAs, raised in a culture of independence, acting more in a fiduciary capacity, are a natural as the industry is moving more to a fee-based investment management approach.” So for CPAs being wooed by broker/dealers, whether they are new to financial planning or seasoned veterans, there are basically two questions to answer, according to Michael David Schulman, CPA, PFS, of Central Valley, N.Y. “What will they provide for you? And what will they charge you?” he asked. Schulman has affiliated with several broker/dealers over the years, and is currently a member of the Elmsford, N.Y.-based Fusion Financial Network, which clears securities through NFP Securities Inc. High on Schulman’s broker/dealer selection checklist: compliance services. “I want to be sure everything I do is in compliance with all the regulations.” For CPAs new to financial planning, regulatory pitfalls specific to the field may not be obvious. Take, for example, client marketing. Schulman knew that when he launched a new Web site for his financial planning practice, it had to be scrutinized by a compliance expert at his broker/dealer, “to make sure everything’s kosher with it.” “I don’t want to become a compliance expert myself; I have enough compliance issues just being a CPA,” he said. But robust regulatory compliance services, while essential, may be more of a given now. The areas where broker/dealers — especially those catering to CPAs — are innovating and competing most aggressively today revolve around professional training, client marketing and productivity-boosting paperless administrative systems. “NFP is into paperless; I like that,” said Schulman.
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