Section F: Member account balance
56 – Account balance
Provide the closing balance of the member’s account on 30 June of the reporting period, as it is known when the MCS is prepared.
For account‑based accumulation interests, the balance of the account on 30 June should be determined according to ordinary accounting principles. The effect of adjustments to the balance made after the MCS is prepared for lodgment need not be reported (such as in an amended MCS) unless they arise from errors rather than from routine adjustments in the value of investments.
A provider extracts data in order to prepare an MCS on 8 October and then on 17 October the provider’s investment manager announces an adjustment to the value of all member accounts as a result of a distribution. This adjustment is not reflected in the balance provided in the MCS and no amendments are required. However, it was found in December that a particular member’s personal contribution had not been reported, so an amended MCS was lodged for that member. The balance reported on that amended MCS correctly reflected both the investment adjustment and effect of the additional contribution (that is, the balance of the member’s account as it was known at the time the amended MCS was prepared).
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Accurate balance reporting is important because it will affect:
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- account consolidation decisions
- the information we display to members
- decisions concerning an appropriate destination for our payments.
For defined benefit and other non‑account based interests, the amount reported at this field should be equivalent to any amount reported in periodic statements issued to the member (including statements under section 1017d of the Corporations Act). However, if no such amount is provided to the member, the field may completed by adding a single zero.
A defined benefit scheme issues an annual statement to members in which a member’s current ‘equity’ is provided, being accumulated member contributions and earnings. Although the value of the member’s interest is not determined, it would be considerably more than this amount since this amount will form only part of the future defined benefit calculation. Nevertheless, the member’s equity amount is reported to the ATO as the balance of the account.
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Circumstances where no balance is available and so the field must be reported as a single zero include:
Last modified: 26 Aug 2014QC 35483
- an insurance‑only policy where the only contributions are applied to pay premiums to an insurer rather than being accumulated
- an entitlement to a lifetime pension based only on years of service and final salary.