The ATO has said it will administer the proposed three-year audits for qualifying SMSFs as well as it can, but has revealed it has received mixed views on the measure.
The consultation period for triennial audits closed on 31 August.
“It’s now a matter for Treasury to advise the industry, but an important point is that clearly, whatever the policy settings end up, we will administer it to the best of our ability, as I’m sure the industry also will,” ATO deputy commissioner James O’Halloran told the recent Chartered Accountants Australia and New Zealand National SMSF Conference 2018 in Melbourne.
“I think the industry is split a little bit.
“There has certainly been anecdotal comments made to me before this current round [of consultation] that it’s too onerous every year, but off feedback from many in the room, formally, there have been other views.”
O’Halloran noted roughly 2 per cent of funds have an audit contravention report.
“The greatest obligation of the trustee is to follow their foundational obligations, and whether it’s a one-year or three-year cycle will be a matter of more regulation,” he said.
“From the ATO’s point of view, we’ll just have to see how it comes out from a policy change point of view and we’ll adjust [our regulatory approach] accordingly.”
During his presentation, he also reiterated the role of the tax office.
“Especially during periods of reform, we seek to enable early engagement and provide certainty of how the commissioner is going to apply the law, while also recognising there will be transitional issues that need to be addressed,” he said.
“The closely held nature of an SMSF means that in our dual role – as regulator of the SMSF sector and administrator of the tax system – we must take a whole-of-tax and super system approach to ensure SMSFs continue to be operated within the bounds of the law and that the integrity of the sector is maintained.
“An essential element of what we do is to uphold and work with you to protect the integrity of the sector.”
He concluded with a reminder about trustee obligations.
“Whether a trustee or director of a corporate trustee, these people are responsible for running the fund and making decisions that affect the retirement interests of each fund member, including themselves,” he said.
