Rollover Evidence Must be Provided to Auditors

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This is a note from Heffron, a respected SMSF Administration business.

SMSF members who have rolled out of their fund into an Australian Prudential Regulation Authority (APRA)-regulated fund will still be required to show evidence of that action to the SMSF auditor, despite no longer being members of the fund.

Heffron senior SMSF technical specialist Annie Dawson said the need to show evidence of a rollover was a requirement for SMSF members leaving or winding up a fund and moving to another superannuation fund, despite the evidence being a member document and not a fund document.

“The auditor is seeking assurance the monies have remained in the superannuation system and rolled to the fund that the rollover benefit statement was directing the money towards,” Dawson said during a webinar today.

“We are seeing clients providing copies of member statements with the inbound rollover or if they can log in to the new fund, creating screenshots of their balance in the new fund.”

“Fund trustees will also write to members when they have received a rollover from an SMSF acknowledging the receipt of the rollover, and any of those things an auditor will accept as evidence.”

Heffron head of SMSF technical and education services Lyn Formica said the request for the evidence was consistent with the work of an SMSF auditor and was part of the protections put around retirement savings.

“It does seem like overkill to some people and SMSF members may regard it as personal information and question why should they have to supply it,” Formica said.

“The auditor has to prove that if you are not entitled to a benefit payment, the rollover has gone into another superannuation fund, otherwise the original fund would have breached the rules by transferring it directly into the hands of the member.”

Dawson noted the introduction of SuperStream may change the requirement, but until it was clear it should be expected auditors will seek those details for a rollover.

“We may see when the SuperStream requirements come in from 1 October the reporting of payments of a rollover out of an SMSF will happen through that system and be verified by the ATO, and that requirement might fall away for auditors as the ATO will provide the checks and balances that monies went where they were supposed to go,” she said.

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