As an accounting practice in Australia, you’ve likely heard murmurs about the AML/CTF “Tranche 2” reforms. But here’s the truth: this isn’t just more red tape. The Anti‑Money Laundering and Counter‑Terrorism Financing Amendment Act 2024 will significantly reshape how accounting firms operate — and the clock is ticking.
Whether you’re a sole practitioner or run a multi‑partner firm, these reforms bring legal, operational, and commercial consequences you can’t afford to ignore. Let’s break it down.
What’s Changing — and Why It Matters
From 1 July 2026, accounting firms that provide services like tax, bookkeeping, payroll, trust management or business structuring will be classified as “reporting entities” under expanded AML/CTF legislation. This brings with it serious obligations under AUSTRAC regulation.
What’s required?
- Risk-based AML/CTF programs (Policies, Procedures and Controls)
- Client Due Diligence (CDD) / Know Your Customer (KYC) processes
- Ongoing monitoring and reporting of suspicious activity
- Staff training and internal oversight
- Annual compliance reviews
Even smaller practices won’t be exempt.
🔗 Official AUSTRAC draft guidance (2024)
Reporting Groups: Share the Load, Share the Risk
The reforms also introduce a new concept: AML/CTF Reporting Groups.
That means two or more accounting entities can operate under one shared AML/CTF Program, led by a nominated “designated reporting entity”. This could streamline compliance for franchise groups, multi-brand networks, or industry alliances.
Pros:
- Less duplication in training, policies, recordkeeping
- Cost efficiencies
- Centralised compliance oversight
Cons:
- Shared liability (a breach by one may expose the group)
- Requires high trust and aligned governance
Solo firms can still operate independently, but must build their own compliant system from the ground up.
What You Need to Do (Now)
Here’s a checklist to get your firm ready — before the mad rush in 2026.
✅ 1. Assess your exposure
Do you offer services like trust setup, business structuring, or tax planning? You’re likely in scope. Map out exactly what activities fall under the law.
✅ 2. Decide your structure
Will you comply solo, or explore joining a reporting group? Now is the time to network, build alliances, and decide.
✅ 3. Draft a compliant AML/CTF Program
It must include a written risk assessment, governance model, procedures for CDD and reporting, and internal controls.
✅ 4. Train your staff
All personnel must be trained — not just partners. Admin and support teams must understand their duties under the law.
✅ 5. Register and Enrol with AUSTRAC
Once the rules come into effect, all reporting entities must enrol and submit documentation via AUSTRAC’s portal.
✅ 6. Monitor changes
AML rules evolve quickly. Subscribe to AUSTRAC alerts and ensure your program is reviewed annually.
What Happens If You Don’t Comply?
This is not just a bureaucratic process. Non‑compliance can lead to:
- Fines up to $26,640 per breach (individuals) or $133,200 (companies)
- Licence revocation
- Damage to your firm’s reputation and trust
- Loss of referral and partner networks
Worse, any perception of facilitating financial crime (even unknowingly) can devastate your client relationships.
It’s Not Just Risk — It’s Opportunity
While these reforms may feel overwhelming, they also create business opportunities:
- Launch compliance advisory services for SME clients
- Partner with law firms or AML tech platforms
- Position your firm as a “low‑risk” operator and trusted partner
Early movers will win credibility — and likely grow faster than their peers scrambling in 2026.
Takeaway
The AML/CTF Tranche 2 reforms are the biggest shake‑up for accounting firms in years. Start preparing now to protect your business, avoid penalties, and unlock growth.