SMSFA collaborates with APRA on rollover improvementsBY ANDREW MCKEAN | FRIDAY, 22 APR 2022 12:16PM
Read more: SMSF, APRA, ATO, SMSFA, SMSF Association, Peter Burgess, SMSF Verification Service, SuperStream
The SMSF sector has been plagued with delays when rolling over funds from APRA regulated funds to SMSFs, so the industry body is working with the regulator with the hope of improving processes.
SMSF Association deputy chief executive and director of policy and education Peter Burgess warned delegates at the annual conference to be prepared to provide further SMSF bank account documentation when requesting rollovers from APRA regulated funds.
Although the SuperStream rollover standards for SMSFs that commenced in October 2021 were designed to improve the efficiency and security of rollovers between the two sectors, there are still frustrating delays.
Burgess cited APRA regulated funds inability to adequately verify the SMSF bank account as a major contributing factor to this pain point.
Burgess explained that the ATO's SMSF Verification Service (SVS) enabled APRA regulated funds to verify many things including the complying status of the SMSF, the SMSF's ABN and that the member requesting the rollover is a member of the SMSF.
However, when it came to the fund's bank account, the ATO's SVS only enabled APRA regulated funds to verify that the information provided at the time of the rollover request matched the information the ATO had on file.
Burgess said: "There is no verification against the information held by the financial institution and therein lies the problem for the APRA regulated funds."
To avoid unnecessary rollover delays, Burgess encouraged advisers to clarify what documents are required by the APRA regulated fund to satisfy their bank account verification requirements.
The SMSFA now meets with the APRA regulated fund sector on a regular basis, he added.
Positively, the APRA regulated fund sector is equally committed and determined as the SMSFA to remove the barriers that prevent funds from being transferred between sectors in a timely and safe manner.
Burgess added: "Ultimately from the SMSF Association's perspective we would like to reach agreement with the APRA regulated funds about the bank account verification documentation that they require to satisfy their obligations."
"Hopefully this can then become a standard that applies to all APRA regulated funds so everyone knows up front what bank account verification documents are required, and we can avoid situations like we have now."
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