Administration, Financial Planning

Advisers best placed to lead SMSF collaboration

SMSF collaboration model

Financial advisers should project manage SMSFs within a family office collaboration model in order to best serve trustees, an SMSF expert says.

Adopting a family office collaboration model, led by a financial adviser, is the most effective way to ensure the necessary collaboration between SMSF professionals servicing the same trustee, an SMSF expert has said.

SMSF Alliance principal David Busoli said financial planners should use their relatively thorough knowledge of their clients’ positions in order to better coordinate advice from multiple parties to trustees.

“Financial planners know their clients best, and not just their financials but all other elements that factor into their position, directly or indirectly. How does the client feel about risk? How complicated is their family in regard to estate planning? Whoever is playing the project manager role needs this contextual information to provide the best service,” Busoli said.

In a blog post on the Chartered Accountants Australia and New Zealand website, he cited the Australian Securities and Investments Commission’s “Report 576: Member experience with self-managed superannuation funds”, released last year, which revealed a greater need for collaboration between SMSF professionals in service of the same trustee.

He also pointed to the “family office model” as a reliable structure for facilitating the necessary collaboration among SMSF professionals.

“Increasingly, I’ve seen financial planners calling in professionals from all sides in a family office model. In this model, all the different suppliers, planners, accountants, administrators, lawyers and other services have well-established collaboration arrangements,” he said.

Such a model would only work if the adviser playing the role of project manager was a strong communicator who laid out “clear areas of responsibility”, he noted.

“The best leaders take charge with very clear communication and set well-defined expectations, responsibilities and deliverables. Having this set out in writing is important to maintaining accountability between parties,” he added.

He highlighted the importance of avoiding an “in-house family office model” when choosing a collaborative structure as this would be more likely to result in a conflict of interest or lower standard of service.

“Having all these services in-house may lead to accusations of vertical integration. It’s also harder to effectively deal with service inadequacies if a colleague isn’t up to scratch. A regular family office model avoids these problems,” he said.

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