The ATO has revealed that while it is aware of rising concerns about more SMSF services being outsourced overseas, it has not yet run into any major issues.
“To date, we’ve seen little evidence of outsourcing of audit or advisory activities,” ATO superannuation acting assistant commissioner Kasey Macfarlane told an SMSF Association NSW State Chapter breakfast last month.
“But it is something that we’re monitoring.”
Macfarlane’s comments came in response to a delegate’s concerns about offshoring and outsourcing across SMSF services, and not just audit, administration and planning.
“A couple of comments I’d make in relation to that is I think from both an audit and advisory point of view, ultimately, it’s the SMSF’s auditor that is responsible and also in relation to regulatory compliance, it’s the trustee that remains responsible,” she said.
“In the SMSF audit space, to be a registered auditor they have to be an Australian individual, they can’t be a corporation.
“So even if they actually outsourced some of the activities in undertaking the audit overseas, whether that be to in-house employees or overseas systems or using external organisations overseas, ultimately the SMSF auditor is responsible.”
In addition, she said once the audit was signed off, they were attesting to the quality and completeness of that audit, as well as verifying the auditing standards had been complied with.
“If we saw a circumstance where records were overseas or things have been outsourced overseas and data or documents couldn’t be retrieved, then we would consider that the SMSF auditor has not met their obligations,” she said.
“And we will take appropriate action in relation to that auditor and make a referral to ASIC where [appropriate].”
Similarly in the advisory space, trustees needed to be aware they were responsible for meeting their regulatory requirements, she said.
“Once again, trustees are responsible for being able to provide to us, as the regulator, all the documents [for their fund],” she said.
“ASIC and the ATO are very strong [watchdogs], but auditors and advisers need to be letting their clients know if they are outsourcing parts of their activities overseas so that all parties can make informed decisions about that.”
