Self-made templates poor practice

smsf document templates

SMSF practitioners crafting their own fund document templates should question if they are doing their clients and practice a disservice.

SMSF practitioners creating their own fund document templates should explore the cost-benefit trade-off involved and whether it is still practical for them to engage in this type of work in the future.

Smarter SMSF chief executive Aaron Dunn said accountants and advisers who were generating pension and compliance documents within their own practices must consider the elements and functions of each document and whether the total cost of producing it was better to an alternative solution.

“When we think about an event or a piece of legislation that may have just been introduced or amended, understanding that requires knowledge and research,” Dunn said during a recent online briefing.

“There is an initial absorption of time around the research, understanding of the law and impacts that come after that in ATO rulings and then the relationship back to the fund’s deed.

“So you are spending a reasonable amount of time to set the foundations of what needs to be done, but then need to be able to create particular document templates that deal with the different combinations so it can be applied across many clients.”

He added this type of background work will need to take place for every document that applies to every client, requiring practitioners to find some way to scale up the production and application of new documents to clients.

“Many clients are likely to be impacted by a particular document that has been created, but there will be a multitude of documents that we will need to deal with each year so we can multiply that out by the multiple of clients by the multiple documents, and you can just see how quickly this all grows,” he said.

He said apart from the risk of creating expensive documents that were not consistent with other documents that have been created internally, is the use of time of the most skilled people in a practice.

“How much time has been spent on these tasks around new and updated documents and how much impact does that have on the firm?” he said.

“What is the opportunity cost within the firm, where you may have senior managers, managers, owners of the business with high levels of knowledge and expertise, spending time going through this process, then applying a top-down approach in the delivery of that back into the firm?”

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