Date issued: 8 February 2007

As Australians are increasingly seeking professional advice about the financial issues surrounding aged care for their elderly parents, CPA Australia has issued guidelines for its members on the areas covered by financial services licensing.

CPA Australia, with input from its Financial Advisory Services Centre of Excellence, has developed a set of guidelines to assist members providing professional advice about aged care issues. The guidelines are the second in a series being developed by CPA Australia for members; and follow the guidance note for advising on SMSFs released in 2006.

CPA Australia Financial Planning Technical Adviser, Belinda Robinson said that it’s important members are aware of all the relevant issues that should be taken into consideration when advising on aged care.

'For example, there are often large issues surrounding the question of whether to sell the family home when parents enter residential care. It is important that exempt assets for Age Pension calculations are not converted to assessable assets because they may lose either part or all of the Age Pension. A  higher daily care fee is charged to non pensioners,' Ms Robinson said.

The guidelines provide information about:

• private accommodation/hostels and nursing homes
• ongoing fees at hostels and nursing homes
• and guidance in all these areas as to which aspects are affected by licensing.

Ms Robinson said she hopes the guidelines provide a useful checklist for members to use when assisting their clients.

Members who are not licensed need to be especially aware of where the limitations are with the advice they provide.

'Accountants are able to advise about credit facilities and property, whether or not they are licensed to provide advice on financial products. They can also provide information relating to Centrelink entitlements. Those members who also offer financial planning services can advise on strategies to maximise age pension entitlements and advise on sale or purchase of financial products,' Ms Robinson said.

'We hope these guidelines will be a useful tool for members and will improve the overall quality of advice given in this area.'

For further information, view the guidance note from the Financial Planning section of the website.

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