Accounts move blindsided sector

SMSFs financial statements

The proposal to require SMSFs to prepare their financial statements 45 days before the fund’s annual return is due to be lodged took the sector by complete surprise, an industry service provider has said.

The requirement to have the financial statements for SMSFs prepared 45 days before the lodgement of a fund’s annual return as part of the “Miscellaneous amendments to Treasury portfolio laws 2020” came out of the blue and caught the sector by complete surprise, a technical expert has said.

“[I’d be interested to know] who has Treasury consulted with to come up with something like this hare-brained idea like they have,” Smarter SMSF chief executive Aaron Dunn said during his organisation’s SMSF Virtual Day 2020 held last week.

“Having spoken with the SMSF Association and some other [stakeholders], they were not aware of it [and] usually you would see some sort of consultation [process] rather than just consultation out of a measure like this via Treasury.”

According to Dunn, the accepted process would have allowed the sector to understand why the proposed amendment has actually been made.

To this end, he suspects Treasury may have suggested the change as a way of providing SMSF auditors more time to scrutinise an SMSF’s financial statements, but said there is potentially a better way to achieve this goal.

“To me they’d be much better making a decision to separate the audit requirement out of the SMSF annual return and therefore enable auditors to lodge, maybe through eSAT (electronic superannuation audit tool) or some other form, in respect to their own audit position [regarding] Part A and Part B,” he noted.

“So separate the function and therefore you may have different dates apply to those two things, but it doesn’t make any sense to me where you are imposing a different set of rules for the financial statements and then a different date for the [annual] return when those two things are naturally done together each and every year.”

Earlier last week, a specialist SMSF auditor urged practitioners to encourage their professional associations to oppose the amendment.

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