Accountants now need to comply with AML/CTF laws
Introduction
Australian accountants that provide certain financial or structuring services must now comply with Federal anti-money laundering and counter-terrorism financing (‘AML/CTF’) laws from 1 July 2026.
The expansion of Australia's AML/CTF regime has now brought many accounting firms within the scope of the legislation.
From 1 July 2026, accountants who provide certain designated services, particularly those involving company structures, trusts, business transactions and other financial arrangements, must comply with the requirements of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth).
Many accounting practices will be providing designated services without realising they are now regulated under the AML/CTF regime. Understanding whether your firm is affected is essential to meeting your legal obligations and avoiding potential regulatory action.
Why does this matter?
Partners, directors, practice managers and compliance officers of accounting firms should understand that the AML/CTF reforms significantly expand the range of businesses subject to Australia's financial crime framework.
The reforms are designed to reduce the risk of criminals using professional service providers to facilitate money laundering, terrorism financing and other serious financial crimes.
For accounting firms, compliance is no longer simply a matter of good governance or accounting, audit and professional standards. It is now a legal obligation that requires firms to identify and assess risk, verify client identities, monitor ongoing client relationships and report certain matters to AUSTRAC.
Handled well, implementation of an effective AML/CTF compliance framework can strengthen governance, improve client due diligence processes and demonstrate a firm's commitment to protecting the integrity of Australia's financial system.
Handled poorly, firms may expose themselves to regulatory investigations, significant civil penalties, reputational damage and increased business risk.
Which accountants are affected?
Not every accounting practice will automatically become subject to the AML/CTF regime.
The reforms apply where an accountant provides one or more designated services captured under the legislation. For example, these designated services commonly include:
Establishing or restructuring companies;
Creating, operating or administering trusts;
Arranging the purchase or sale of companies or businesses;
Managing client funds in connection with designated transactions;
Acting as a nominee director or shareholder in certain circumstances; or
Providing registered office or business address services where captured under the legislation.
Whether a particular service is regulated will depend on the nature of the work being performed rather than simply the professional title of the person providing it. Many firms will therefore need to carefully review their service offerings to determine whether they are reporting entities under the AML/CTF Act.
What are the key compliance obligations?
Where an accounting firm provides designated services, it will generally be required to comply with a range of ongoing obligations under the AML/CTF legislation.
These include:
Enrolling and registering with AUSTRAC where required;
Developing and maintaining a compliant AML/CTF Program that identifies and manages money laundering and terrorism financing risks;
Conducting customer due diligence, including verifying client identity before providing designated services;
Undertaking enhanced due diligence where higher-risk clients or transactions are identified;
Monitoring customer relationships and transactions on an ongoing basis;
Keeping prescribed records for the required statutory period; and
Reporting suspicious matters and other reportable transactions to AUSTRAC where required under the legislation.
Importantly, these obligations are ongoing. Compliance is not achieved simply by implementing policies at the commencement of client work. Firms are expected to continually monitor, review and improve their AML/CTF framework as their business evolves.
Why these reforms matter for accounting firms
Historically, accountants have played a trusted role in advising clients on business structures, acquisitions, taxation and succession planning.
While these are legitimate professional services, international experience has demonstrated that sophisticated criminal organisations may attempt to misuse professional advisers to conceal the proceeds of crime or establish complex ownership structures.
The expanded AML/CTF regime seeks to reduce these risks by requiring accounting firms to better understand:
Who their clients are;
The source of funds involved in transactions;
The purpose of the engagement;
Whether the transaction presents an elevated money laundering or terrorism financing risk; and
When suspicious activity should be reported to AUSTRAC.
For many firms, these requirements will represent a significant shift in practice management, internal compliance management expectations and resource commitment.
Governance implications for accounting practices
The introduction of AML/CTF obligations should be treated as a significant governance obligation. Partners and directors should have ensured their firms were adequately prepared before providing designated services after 1 July 2026.
Best practice preparation could include:
Conducting an assessment of whether any current services are designated services;
Appointing a suitably qualified AML/CTF Compliance Officer;
Completing an enterprise-wide money laundering and terrorism financing risk assessment;
Developing or updating internal policies and procedures;
Providing comprehensive staff training;
Reviewing client onboarding processes and engagement documentation; and
Testing compliance systems, ideally before the commencement date.
Strong corporate governance demonstrates that compliance is embedded ‘from the top’ and within the firm's corporate culture rather than being treated as an administrative exercise.
Conclusion
The extension of Australia's AML/CTF regime represents one of the most significant regulatory changes affecting the accounting profession in recent years.
For firms providing designated financial or structuring services, compliance is now a legal obligation rather than just a matter of best practice.
Partners and directors should ensure they clearly understand whether their services fall within the legislation, implement an effective AML/CTF compliance framework, and maintain appropriate governance processes to support ongoing compliance.
Taking a proactive approach will not only assist in meeting AUSTRAC's expectations but will also help protect your practice, your clients and the broader integrity of Australia's financial services system.
If you are unsure whether your accounting practice provides designated services, or would like assistance implementing an AML/CTF compliance framework tailored to your business, please contact us for an obligation-free discussion.
Early preparation can significantly reduce implementation challenges and help position your practice for ongoing compliance with Australia's evolving financial crime laws.
Can we help your business?
If you are a private company board or a company holding an AFSL and would like to discuss how I can assist your company with enhancing your governance so that you can better manage your compliance risks and protect your investors, please contact me for an obligation-free discussion. I can assist your company with:
Responsible manager;
Compliance committee;
Company director;
Advisory board services;
International company resident director services;
Compliance reviews; and
Governance committee services.
I’d be excited to assist your company meet its ongoing governance and compliance obligations relating to your company, or your AFSL, and to give your customers and investors/shareholders comfort that you can manage your business with institutional grade corporate governance.
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