The federal government should strongly consider requiring SMSFs using a three-year audit cycle to have a “light-touch” compliance check in the non-audit years should it choose to proceed with its audit proposal, an industry body has argued.

BDO Australia’s superannuation partners have written to new federal Treasurer Josh Frydenberg and Assistant Minister for Treasury and Finance Zed Seselja to direct their attention to the significant unintended consequences of the introduction of a three-yearly audit cycle for SMSFs.

SMSF administrator and software provider SuperConcepts has strongly warned against leaving trustees at risk of mistakes and potential fines under the proposed three-year audit regime.

SMSFs with a history of good record-keeping should be allowed to reduce the scope of their annual audit instead of moving to a three-year audit cycle, according to Pitcher Partners.

A specialist lawyer has suggested a statement contained in the discussion paper addressing the proposal allowing certain SMSFs to move to a three-yearly audit cycle gives practitioners the opportunity to continue to solely provide annual auditing services.