Managing my Fund
The importance of Administration
SMSF administration has very little to do with preparing financial statements such the balance sheet and profit or loss. It has a lot to do with member statements. Different components such as concessional contributions are afforded varying preservation and tax treatments.
With rules on the level of contributions into the fund in any year and rules on when and how benefits can be taken the administration of the find takes on great importance.
Traps that occur are more innocent until inevitably it is too late and the financial ramifications become unavoidable, which is regrettable when in most instances, with a bit a forward planning and good compliance, they could be avoided.
The Trustees, among other issues are required to:
- Establish appropriate accounting systems for the fund (keeping a separate account for each member)
- Gain an understanding of the operational requirements of the fund
- Ensure that annual returns are lodged with the ATO
- Ensure that minutes of meetings in relation to the superannuation fund are recorded and retained for 10 years
Having your SMSF administered by a firm that specialises in the industry can ease substantially any headaches you come across.
The Australian Taxation Office (ATO) is charged with overseeing the administration of SMSFs and ensuring that Trustees comply with all of the requirements of running a fund. This can be very difficult and time consuming for you to manage.
The Australian Taxation Office (ATO) has made a great attempt over the course of the last few years to help educate trustees on what their roles and responsibilities in the management of a SMSF through the ATO publication “Roles and Responsibilities of Trustees”, and have also attempted to explain their position as regulator and the responsibilities of associated parties such as auditors, tax agents, actuaries, and administrators in the ATO publication “it’s your money…but not yet!”
The trustees must appoint an auditor and may appoint an administrator, investment advisor and accountant.