According to a recent study from an independent employee benefits firm, most accountants ignore workplace pension law.
Most accountants tell their clients that they don’t need a business adviser who is expert, experienced and insured on all aspects of auto-enrolment. And, most, albeit perhaps unwittingly, admit to breaking the law when it comes to scheme selection for auto-enrolment.
The ICAEW Code of ethics states under section 330:
“The fundamental principle of professional competence and due care requires that a professional accountant in business only undertake significant tasks for which the professional accountant in business has, or can obtain, sufficient specific training or experience. A professional accountant in business shall not intentionally mislead an employer as to the level of expertise or experience possessed, nor shall a professional accountant in business fail to seek appropriate expert advice and assistance when required.”
The Pensions Regulator adds:
“We are mindful that many small and micro employers will not put much thought into the choice of pension and may simply select the scheme their bureau / accountant uses as ‘standard’ (typically NEST). So, we have been asking business advisers if they can provide information about pensions (and advice if they have the expertise/experience) to their clients and encourage their clients to think about which scheme would be best for their staff. However, in our standard slide pack for intermediaries, on this subject (“The FCA regulations and choosing a pension”) we do warn that if they are giving (non-regulated) advice they should “consider the ethical standards set by your professional body and the scope of your professional indemnity insurance”.
Yet according to a recent study from Helm Godfrey:
Almost half of accountants admit to not knowing enough about auto-enrolment. The knowledge gap puts SMEs at risk of ending up with unsuitable pension schemes.
The report, found that 43% of accountants surveyed admitted to an auto-enrolment knowledge gap being their own biggest challenge when it came to advising businesses.
It added that 41% said they had difficulty navigating the detail of auto-enrolment while 32% said they had concerns about finding the right advice for clients.
Over half (56%) of accountants surveyed said they are telling all SMEs to choose the government’s National Employment Savings Trust (NEST) scheme, without apparently researching whether this would be the best option for them. This is a clear breach of duties in law, and a breach of their own professional Code of Ethics.
While 42% of accountants surveyed said they recommend that clients speak to a specialist adviser about auto-enrolment, the remaining 58% do not.
If you want to stay legal, comply with professional codes of ethics, keep clients compliant and recommend that your clients speak to a specialist adviser – who is expert, experienced and insured – Workplace Pensions Direct can help.