The Australian Securities and Investments Commission (ASIC) considers “financial innovation-driven complexity in products” to be one of its major challenges.

In a statement of intent to the Federal Government, the regulator says it will focus on areas of high risk to consumers, including financial advice.

The Australian Prudential Regulation Authority (APRA), the Australian Competition and Consumer Commission (ACCC) and the Tax Practitioners Board (TPB) have also issued statements outlining how they will meet the Government’s expectations of their roles.

APRA has confirmed its stance on risk management, saying that it rests with an entity’s board and senior management.

Its statement of intent says its role is to “promote prudent behaviour by institutions through a robust prudential framework of legislation, prudential standards and prudential guidance. APRA aims to ensure that risk-taking is conducted within reasonable bounds and risks are clearly identified and well managed.”

The regulator says it will not pursue a zero-failure approach, but aims for a low incidence of failure.

“APRA cannot eliminate the risk that any institution might fail and it recognises attempting to do so would impose an unnecessary burden on institutions and the financial system. APRA’s objective is to identify likely failure of an APRA-regulated institution early enough so corrective action can be promptly initiated or an orderly exit achieved.”

The TPB says its key tasks include ensuring registered tax practitioners have appropriate professional indemnity insurance and raising the number of registration requests that do not require further questioning of the applicant.

All the regulatory bodies support the Government’s attempts to deregulate the financial services industry.

ASIC says it has removed 10% of the forms businesses must submit to the regulator.

APRA has updated much of its prudential framework in the past three years and intends to undertake such reviews on a more regular basis.

The ACCC says it is committed to reducing compliance costs.

It “acknowledges the Government’s preference for principles-based regulation that identifies desired outcomes as a means for reducing regulatory and compliance burdens. The ACCC will continue to apply a principled and risk-based approach that ensures proportionate responses to actual and potential harms.”

The TPB says it aims to be more user-focused. “The [board] will develop our procedures and policies by using a principles-based approach, thereby ensuring flexibility in application and reducing compliance costs for regulated entities.”