An industry auditor has confirmed accounting and advisory firms have improved their approach toward the SMSF investment strategy and attributes this development to ATO action pertaining to this fund element.
“Firms in general over the last few years have gotten a lot better with their investment strategy understanding. [Since] the ATO [performed its] focus point on investment strategies, it’s been really good. I haven’t seen this being too big of a problem at our end [recently],” Seamless SMSF specialist auditor and adviser Frank La Spada noted.
To this end, La Spada recognised a distinct effort from these practitioners to move away from popular generic or default software-driven investment strategy documents that have proved problematic in the past.
“We’re seeing investment strategies becoming more bespoke. [Accounting] firms are understanding the rules, they’re engaging financial planners and people who are licensed to provide advice on the strategy piece and they’re just doing the right things,” he told attendees of the most recent Accurium technical webinar.
Further, he acknowledged certain practitioners are implementing procedures to improve trustee involvement in the process and boost their practice management.
“There are even some products out there [being used] that allow the trustees to formulate their own strategies online. I think some firms have found that to be a little bit more cost effective and it [has the advantage of taking the accountant] out of [the process] because they are not able to assist in that area,” he said.
According to La Spada, the shift has been positive for overall compliance with the greater investment strategy obligations.
“For the most part firms are becoming very proactive with this and they’re also ensuring that, as part of their annual checks, their clients are regularly reviewing [the investment strategy], so I think it’s been a very good shift from the [practices] and from trustees,” he said.
