A specialist auditor has revealed SMSF trustees are still struggling with executing SuperStream rollovers properly on several fronts, with one particular issue plaguing them being a lack of information the system provides when an attempted balance transfer fails.
“The problem here is that when [a rollover] fails there’s no information from SuperStream for trustees to act upon. Trustees are told the transfer has failed, but they’ve got no idea as to how to fix it because they don’t know what the problem is,” ASF Audits head of education Shelley Banton told attendees of her latest technical webinar held last week.
To this end, Banton revealed trustees are encountering several SuperStream difficulties with the banks and Australian Prudential Regulation Authority (APRA)-regulated funds.
With regard to the banks, problems with electronic rollover limits have been reported, but other significant impediments are also present, she said.
“There is another issue [where] some banks don’t have data fields long enough to accept the PRN (payment reference number) for that online transfer. So [in these cases] the transaction isn’t completed because the APRA fund has no way of recognising who the deposit is for,” she noted.
Further, she pointed out some SMSF trustees are using a single PRN for a rollover requiring a series of transfers, each of which will have its own reference number, while other transactions are being rejected due to errors involving amounts as low as 1 cent.
According to Banton, the procedural rules of APRA funds are also making member rollovers via SuperStream extremely challenging.
“Each one has its own different set of requirements under SuperStream, which means at the moment it is impossible to have one set of procedures that covers all of them,” she said.
“Some of the smaller funds don’t actually accept electronic transfers and therefore a trustee can’t meet the standards when they have to [perform] a rollover by a cheque because as we know the transfer has to be done electronically.”
She revealed the very stringent Anti-Money Laundering and Know Your Client rules applying to APRA-regulated funds are also hampering the process.
The audit procedure will, in contrast, be relatively straightforward regarding the review of SuperStream rollovers, she pointed out.
“From the audit side of things it is fairly simple. We’re just simply going to request the competition notice from the SMSF administration software, we’ll look at the bank account and then we’ll ask for the trustees to ensure the transfer complies,” she said.
“And if all that falls into place, we’re going to give the fund a SuperStream tick of approval.”