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Investment Strategy Puzzle

End of August 2019, the ATO sent out about 18,000 letters to SMSF Trustees to "ensure that their investment strategy complies with the law" where their investment Strategy outlines that the fund may hold 90% or more of its assets in one asset or a single asset class or cop $4200 fine.

The ATO also wrote to their SMSF Auditors outlining their reporting role and what Trustees must do, where the fund has invested in a single asset or single asset class.

These letters have caused a lot confusion among Accountants & Auditors who have received these letters. Firstly why were these letters sent and secondly why these letters were sent to only to about 18,000 funds, where about 1/3rd of all funds invest in single asset class, e.g. shares or say fixed interest or property etc.

And lastly, how should they prepare an investment strategy for the fund or audit investment strategy for 2019 financial year as the ATO did not provide any clear guideline nor there is any clarity on investment strategy in SMSF Guidance Statement for SMSF's GS 009.

Trustees are also worried on two accounts, firstly will they have to pay a fine if they have only one asset or one asset class and will have to diversifying to 89%, or lower, in one asset class to remove them from the ATO's radar.

 

FREE Webinar

When: 16th October 2019 Wednesday

Time: 2.00 PM to 3.00 PM 

Cost: Free

How To Bookhttps://attendee.gotowebinar.com/register/2031293158760860172

CPD RG243.100: Development on Superannuation - 1 Hour

CPD FASEA: Client Care and Practice - 1 Hour

Presenter: Manoj Abichandani ASIC Approved Auditor, SMSF Specialist (UNSW)

Manoj has worked in SMSF since 1988 and is SMSF Specialist (UNSW) and holds a Limited AFSL for SMSF. He was providing high level advisory services to over 600 funds in his own 3 partner CPA tax practice for 19 years and has written this online software. He currently works as SMSF Technical Support Team Leader at www.trustdeed.com.au 

He has hands on knowledge on what happens in a tax practice on high level of SMSF practical issues.

In his presentation, Manoj Abichandani will unmask, why these letters were sent, the current practice by accountants and auditors and what must happen, so that Trustees do not pay any fines and Accountants & Auditors to not breach superannuation law.

If you or your client have received this letter, this is a non-miss event as Manoj will show you how advisors can package their services, prepare an SOA for investment strategy, what to write to the Trustees plus a template of a property non-diversified investment strategy & minutes to document & adopt the investment strategy.

 


https://www.onlinesmsfaudit.com.au/filemanager/userfiles/Images/logo%20(1).png

ADVERTISEMENT

 

 

 

Once you register, you get to use the software for free for 5 SMSF's - Try before you buy. The fee to audit one fund is $17 plus GST or can be $7 plus GST, per fund if you buy 2,000 audit pack.

 

Click here to download list of features and brochure of online SMSF Audit  

Click here to start your free trial for 5 funds

 

We recommend that you join SMSF Auditors Association of Australia LTD which offers 20 hours of Annual CPD via 20 online webinars for a low fee of $240 + GST. To Join visit www.smsfaaa.com.au

 


 

How CPD Works

ASIC Approved SMSF Auditors

Section 128F(a) of SIS Act : An approved SMSF Auditor must: (a) complete the continuing professional development requirements prescribed by the regulation.

SIS Reg 9A.04 : (2) The approved SMSF auditor must undertake at least 120 hours of continuing professional development every 3 years.

(3) The development must: (a) include 30 hours of development about superannuation at least 8 hours of which is development about auditing of self managed superannuation funds; and

(b) be development that could reasonably be expected to enhance an approved SMSF auditor's technical skills or professional service delivery.

 

AFSL Holders - FASEA Requirements

The Corporations Act 2017 (the Act) requires that all individuals identified as a ‘relevant provider’ are required to meet the requirements for continuing professional development set by the Standards Body (s 921B(5)). The Act requires the Standards Body to set requirements for continuing professional development in relation to each CPD year of a financial services licensee (s 921U(2)(iv)).

Part 7.6 of theCorporations Act 2001 Corporations (Relevant Providers Continuing Professional Development Standard) Determination 2018

The minimum number of hours of qualifying CPD activities that a relevant provider must complete during a CPD year is 40. If the relevant provider has a responsible licensee, at least 70% of the minimum number of hours must be spent on qualifying CPD activities approved by the licensee.

Note 1: This means that  any AFSL holder working full time at least 28 hours will have to be spent on approved activities.

 

 

Content of CPD activity

 

CPD area

Minimum Hours

1

The activity is designed to enhance participants’ technical proficiency and ability to develop and provide advice strategies that are appropriate to the objectives, financial situations and needs of different classes of retail clients.

 

Technical competence

     5

2

The activity is designed to enhance participants’ ability to act as a client-centric practitioner in advising retail clients.

 

 Client care and practice

     5

3

The activity is designed to enhance participants’ understanding of applicable legal obligations and how to comply with them.

 

Regulatory compliance and consumer protection

     5

4

The activity is designed to enhance participants’ capacity to act as an ethical professional.

 

Professionalism and ethics

     9

5

The activity is designed to maintain and extend participants’ professional capabilities, knowledge and skills, including keeping up to date with regulatory, technical and other relevant developments, but is not in an area referred to in another item of this table.

 

     General

 

 

 

 

 


 

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