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More qualified audit reports expected for older assets

The number of qualified audit reports regarding SMSFs with asset acquired before 1999 was likely to rise in the coming years as record-keeping for those assets began to decline due to the passage of time, according to an audit specialist.

Speaking at the recent Chartered Accountants Australia and New Zealand National SMSF Conference 2015 on the Gold Coast, BDO superannuation partner Shirley Schaefer said she had recently witnessed a situation that suggested that would be the case.

“The auditor when forming his opinion qualified his audit report and he qualified it with a limitation of scope because there was no information available for him to draw a conclusion on whether or not the asset in question was a pre-1999 asset,” Schaefer said.

“It’s the first time I’d seen somebody qualify on that basis and I think we will see more of it.”

She said she personally had not had any trouble accessing documentation and information on pre-1999 assets relating to the original purchase date and 2009 records for the same assets to cover off any changes to those types of assets in the interim rule period.

However, she said that was unlikely to be the case in the coming years.

“As we get further and further away from those dates, if that information has not been retained, and people do toss things out after the statutory periods, I think we might see more of that coming through with that limitation of scope,” she said.

“It’s just something to be aware of.”

Due to the potential record-keeping issue, she said if she as an auditor had the information on file, but had lost the client’s account, she would hand it over to the new service provider on the authority of the client.

“Should the trustees retain all that documentation? Of course they should, but they don’t always do that,” she said.

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