Measures introduced on 7 August 2012 are part of the suite of measures announced within Stronger Super. These measures are intended to address potential risks and strengthen the regulatory framework in which self-managed super funds (SMSFs) operate.
These measures mean that you, as trustee of an SMSF, are:
- required to conduct a review of the fund's investment strategy on a regular basis
- required to consider insurance for fund members as part of the fund's investment strategy
- required to value the fund's assets at market value for the purposes of preparing financial accounts and statements - we have published Valuation guidelines for self-managed superannuation funds to assist you and your advisors to comply with this requirement.
The obligation that you as a trustee of an SMSF are required to keep money and other assets of the fund separate from any money or assets held by you personally or by a standard employer-sponsor or an associated standard employer-sponsor is now a prescribed operating standard.
All these measures are prescribed operating standards for the fund, which means you must ensure they are complied with at all times.
What this means for trustees
During each income year from 2012-13, you should review your fund's investment strategy to ensure that it continues to reflect the purpose and circumstances of your fund and its members. These reviews should occur on a regular basis and could be evidenced by documenting decisions made in the minutes of meetings held during income year. You should also consider insurance for members.
Each of the SMSF's assets should be valued at their market value when preparing accounts and statements for the 2012-13 income year and later years. Accordingly, the first time you will need to ensure compliance with this requirement will be in relation to the 2012-13 income year accounts and statements, where you will need to determine the market value of the assets as at 30 June 2013.
You have always had an obligation to keep the money and other assets of the SMSF separate from those held by you personally or by a standard employer-sponsor or an associate of a standard employer-sponsor. However, because this was previously a covenant deemed to be part of the governing rules of the fund and not an operating standard, the law did not give us an enforcement role.
The new regulation has made this requirement an operating standard, which gives us the power to enforce compliance. A person who intentionally or recklessly contravenes this standard is guilty of an offence punishable on conviction by a fine not exceeding 100 penalty units (one penalty unit currently equals $170).
Media release
For more information about government super reforms, refer to media release no. 024/2010 issued on 16 December 2010 by the Assistant Treasurer and Minister for Financial Services and Superannuation.
Last Modified: Tuesday, 8 January 2013