The ATO has outlined the areas it will closely examine this financial year in regards to SMSF auditor compliance, with a particular emphasis on the systems practitioners use to carry out audit functions.
The regulator stated in an update on its website “our 2026/27 compliance program will focus on areas where we see the highest risk to audit quality and SMSF regulatory outcomes”.
Specifically, it stated it would be looking at market valuation reviews, “including whether auditors obtained sufficient appropriate objective audit evidence to verify compliance with regulation 8.02B”.
“This focus will become especially important for the 2026/27 audits where auditors will be required to check valuations of assets that may trigger a Division 296 liability for a fund member,” it noted.
In regards to the systems and processes SMSF auditors use, it indicated it would conduct high-risk auditor reviews where its intelligence and data indicated practitioners may not be conducting independent and adequate audits.
Additionally, reviews would take place of high-volume auditors where the ATO would check if practitioners have the processes and procedures to manage a large number of audits, as well as examination of auditor independence reviews in situations where auditors or their firms provide both assurance and non-assurance services to an SMSF.
Newly registered auditors would also receive attention to ensure they understand their obligations and to address deficiencies early on.
The update added the areas of focus were shaped by the findings of a compliance review undertaken in the last financial year.
“During 2025/26, we completed close to 200 reviews and audits of SMSF auditors and referred 39 auditors to the Australian Securities and Investments Commission,” the regulator stated.
“These referrals included auditors who lacked the practical experience to conduct audits and auditors who did not conduct independent or adequate audits.
“Our reviews also identified recurring issues with audit evidence, auditor reporting and file documentation. In many files, auditors had not obtained sufficient appropriate evidence to support the ownership, existence or market value of fund assets.
“Quality audits protect members’ retirement savings and support the integrity of the SMSF system.
“Quality audit files clearly document professional judgments and contain sufficient appropriate audit evidence to support audit conclusions.”
Jason Spits
SENIOR JOURNALIST
Jason is a senior journalist with Benchmark Media and writes for the selfmanagedsuper website and magazine and smstrusteenews website. He has covered financial services since 1999 and has written about life insurance, superannuation, investment management and financial advice, in both a freelance and in-house capacity, and also did a brief stint as a media manager for an industry association. He has been the editor of trade titles Money Management and Financial Standard, and was most recently senior journalist with life insurance title Riskinfo.
Articles by Jason