SMSF Auditor 2021: Managing the Risks & Challenges – 6 program on demand webinar series

Program 1: Auditing the Investment Strategy

SMSF auditors may understand the importance of the investment strategy but what this means in practice requires a bit more consideration. This session looks at the key issues, including:

• Audit procedures for investment strategies - an overview
• Ensuring the diversification requirement is met
• Considering liquidity needs of fund
• Bringing investment strategy problems to attention of trustees
• Investment strategy compliance breaches - the what, when and how
• ATO guidelines on auditor’s role
• How has COVID-19 impacted the investment strategy?
• Understanding what the auditor cannot do

Program 2: The Non-arm’s Length Rules - Meeting ATO Expectations from an Audit Perspective

The application of the NALI rules to general expenses are likely to have a significant impact on some SMSFs. This session examines how they impact the auditor, including:

• Understanding ATO rulings on NALI and NALE - an overview
• ATO expectations on NALI and NALE
• Making sure we identify NALE
• What is the ‘nexus’ that triggers the NALI provisions?
• The application of general expenses NALE
• Individual acting as trustee - some important do’s and don’ts
• Trustee remuneration and NALI risk
• What are the key considerations from an auditor perspective?
• Case studies

Program 3: Auditor Reporting Obligations - Meeting and Exceeding Auditing Standards

The reporting function is at the heart of the auditor’s role. This practical session covers two key areas: reporting to trustees and contraventions to the ATO. It examines:

Reporting to trustees:

• The independent auditor’s report - key inclusions from recent ATO updates
• Reporting on contraventions and the management letter to trustees
• Determining the financial position of fund
• Reporting methodologies - the do’s and don’ts
• Case studies - problem scenarios and their reporting to trustees

Reporting to ATO:

• The Auditor Contravention Report
• What contraventions do not need reporting
• Reporting of prior year breach
• Separation of assets - regulation 409 A
• Case studies - contravention reporting tips and traps

Program 4: Super Contributions and the SMSF Auditor’s Role

Contributions have a wide definition under taxation rulings, so the auditor has a consequentially important function. This session looks at the key areas, including:

• Type and tax status of contributions
• Understanding different types of concessional contributions
• Understanding trust deed requirements in respect to contributions
• Update on recent changes to contribution rules
• Changes to work test and spouse contributions
• Change to bring forward rules on non-concessional contributions
• The auditor’s role in relation to contributions
• Practical case studies

Program 5: Auditing Pensions - Getting That Check List Right

This session provides a practical focus on what must be checked when a fund is in pension phase. It includes:

• What does the ATO want auditors to check - an overview
• Meeting an appropriate condition of release
• Do the financial statements support the pension valuation?
• Properly documenting any commutations
• Calculation of exempt current pension income with respect to pensions
• When the pension commenced, and payments have been paid
• Meeting minimum pension payment requirements
• Case study - some problem scenarios and what to watch

Program 6: Auditing the Death of a Member in an SMSF

When a member dies there are several compliance matters that must be considered. This session looks at the key areas for auditors on the death of a member, including:

• Reviewing compliance with regulations on cashing of members benefit on death
• A review of fund administration - who has control of fund?
• When the auditor should question who benefits have gone to
• Have trustees observed a valid binding death benefit nomination?
• Checking whether a death benefit has been cashed
• Reviewing tax considerations in respect to death benefits
• Checklist on relevant documentation required for audit purposes