• SASG minutes September 2013

    Meeting details

    Attention

    Warning:

    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention
    Venue:

    Rooms 719 & 720, Level 12, ATO Latitude East, 52 Goulburn Street, Sydney NSW 2000

       

    Date:  

    Wednesday 18 September 2013

       

    Start:  

    10.00 am

    Finish:  

    2:00 pm

    Chair:  

    Sally Druhan

       

    Contact and Secretariat:  

    Phil McDonald

    Contact phone:  

    13 28 69

    Attendees

    Alan Harvey

    AAS

    Amanda Gunn

    Mercer

    Andrea Cooper

    Financial Synergy

    Anne Dixon

    Precision Administrative Services

    Christopher Smith

    Perpetual Investments

    Eion Burke

    Superpartners

    Garry Powell

    Super SA

    George Strilakos

    UniSuper

    Graeme Colley

    SPAA

    Heide Stewart

    IOOF

    Ian Stirling

    Comsuper

    Jayne O'Ryan

    QSuper

    Jeff Broderick

    Bravura Solutions

    Jun Tang

    Onepath

    Karen-Anne Herald

    NAB / MLC

    Kelly Kerr

    BT

    Maria Anislag

    Zurich

    Martin Mikulicin

    Bravura Solutions

    May Low

    CBA (Colonial First State)

    Robert Hodge

    ASFA

    Ian Stirling

    Comsuper

    Sue Pearce

    FuturePlus Financial Services

    Suresh Soppa

    CBA (Comminsure)

    Tina Cifelli

    AMP

    David Jordan

    ATO – CAS, Superannuation

    Grace Ng

    ATO – Superannuation, Data Standards

    John George

    ATO – Superannuation

    Jamie Mendyk

    ATO – Superannuation

    Michael Gleeson

    ATO – Superannuation

    Linda Cheesman

    ATO – CAS, Superannuation

    Phillip McDonald

    ATO – CAS, Superannuation

    Sally Druhan

    ATO – CAS, Superannuation

    Apologies

    James Barnwell

    Russell Investments

    Karen Downes

    Superpartners

    Mary Gale

    SPAA

    Neil McMillan

    Pillar

    Rebecca Scott

    Perpetual Investments

    Roman Wegner

    CBA (Colonial First State)

    Simone Sluchniak

    GESB

    Emma Haines

    ATO – Superannuation

    John Shepherd

    ATO – Superannuation

    Mary Arrowsmith

    ATO – CAS, Superannuation

    Next Meeting

    Wednesday 4 December 2013

     

    Please note: SASG agendas, minutes and related papers are not binding on the ATO or any of the other bodies referred to in these papers. While every effort is made to accurately record views expressed, the wording necessarily represents a summary of statements of general position only, and care should be taken in interpreting those statements. These papers reflect the position at the date of release (unless otherwise noted) and readers should note that the position on any issue may subsequently change.

    Agenda Items

    1 Opening

    Sally Druhan (Assistant Commissioner, Client Account Services) opened the meeting welcoming all in attendance.

    Declaration of Conflicts of Interest  

    The Chair advised members of the requirement to declare any conflict of interest or conflict of role. No declarations of conflict were advised.

    12 June 2013 SFWG Minutes endorsed  

    The draft minutes of the last meeting held Wednesday 12 June 2013, circulated on Tuesday 16 July 2013 were accepted without change.

    2 Review of action items from 12 June 2013 meeting

    Action item

    12062013/01 – Summary of budget announcements and legislation update to be provided to SFWG members electronically

    Status  

    Closed – SFWG Secretariat email issued to members advising of summary of budget announcements and legislation update discussed by John Shepherd.

    Action item  

    12062013/02 – Do proportioning laws need to be changed to account for Kiwi Saver accounts?

    Status  

    Closed – SFWG Secretariat email issued to members advising of responses to Trans-Tasman Portability questions.

    Action item  

    12062013/03 – How should funds deal with currency conversions? For example where the amount on the form does not correlate with the amount in the account.

    Status  

    Closed – SFWG Secretariat email issued to members advising of responses to Trans-Tasman Portability questions

    Action item  

    12062013/04 – ATO to confirm if the Unique Superannuation Identifier field can be added to the Kiwi Saver Scheme Payment Statement.

    Status  

    Closed – SFWG Secretariat email issued to members advising of responses to Trans-Tasman Portability questions.

    Action item  

    12062013/05 - Members to send through any further comments or scenarios requiring clarification about Trans-Tasman Portability measure to SFWG Secretariat mailbox.

    Status  

    Closed – Forwarded action item to SFWG members. Advised members they have until close of business 28 June to respond if they have any comments.

    Action item  

    12062013/06 - ATO to send induction guide to SFWG members for rollover transition-in period.

    Status  

    Closed – SFWG Secretariat email issued to members advising of rollover transition-in induction guide and timetable...

    Action item  

    12062013/07 - What is the median figure for small accounts reported to the ATO for USM?

    Status  

    Closed – SFWG Secretariat email issued to members advising of median value.

    Action item  

    12062013/08 - For the ATO to review LMR and USM protocol documents and determine if it is possible to publish a version showing tracked changes (as opposed to the clean version shown on the ATO website).

    Status  

    Closed – SFWG Secretariat email issued to members advising of major changes to LMR and USM protocol documents. Tracked version of MCS protocol document was issued as part of CRT Alert 025/2013.

    Action item  

    12062013/09 - ATO to issue to SFWG members an updated version of the payment schedule for funds.

    Status  

    Closed – SFWG Secretariat email issued to members advising of updated payment schedule.

    Action item  

    12062013/10 -– ATO to clarify how LISC payments are to be treated and reported by funds.

    Status  

    Closed – SFWG Secretariat email providing update as to how payments are to be treated.

    Action item  

    12062013/11 - ATO to revisit the TFN notification process and advise whether notices will cease until early 2014, or if they can be issued earlier.

    Status  

    Closed – SFWG Secretariat email issued to members advising that TFN notification automated process will be switched off until early 2014

    Action item  

    12062013/12 - ATO to advise when Schedule 2A and Schedule 2B “request to transfer funds” forms will be published on ATO website.

    Status  

    Closed – SFWG Secretariat email issued to members advising of new forms published on ATO Website. Provided PDF copies of both forms.

    Action item  

    12062013/13 - ATO to follow up bulk transfer request in relation to successor fund transfers.

    Status  

    Closed – Provided advice to Tina Cifelli in relation to the ATO’s position on the bulk transfer request

    Action item  

    12062013/14 - ATO to review current former temporary resident deferral and revocation process to determine if changes can be made to make process more efficient for ATO and funds.

    Status  

    Closed – Provided advice to Anne Dixon about the current TR deferral and revocation process and that her comments/feedback had been provided to Beverley Easton for review and consideration with USM moving to ICP at the end of 2013.

    Outstanding action items from 13 March 2013 meeting

    Action item

    13032013/03 – Provide confirmation that a payment made by the ATO to a members account (e.g. Superannuation Holding Account, Superannuation Guarantee, Co-Contributions, etc) is to be treated by the funds as a contribution and thus they have received an amount in respect of the member within the past twelve months.

    Status  

    Closed – SFWG secretariat forward additional advice received from CTU as to how to treat payments in respect of the inactivity test.

    3 Operation of Superannuation Administration Stakeholder Group (SASG)

    Sally Druhan provided members with an update on ATO Consultation and discussed the transition of this group to the stakeholder relationship management group environment.

    Key points of the ATO Consultation Review were discussed, including:

    1. Outcomes from the Review
      1. New consultation framework featuring:
        1. eight stewardship committees
        2. a dynamic model where the participants, methodology and timeframe are determined by the nature of issue being considered
        3. intelligence hub framework to facilitate and co-ordinate consultation with the ATO
         
      2. ATO consultation website has been updated to:
        1. provide an entry point to raise matters for consultation
        2. advise community about consultations underway or completed
        3. enable members to register interest in being contacted when we are seeking to consult
         
      3. The ATO Consultation Protocol provides guidance for consultation
       
    1. How consultation works:
      1. Stewardship committees consider high level significant matters of National interest (e.g. Superannuation Consultative Committee – SCC is one);
      2. Stakeholder relationship and management engagements (like this group) where key relationships with representative organisations / intermediaries are maintained, with the view of maintaining the smooth operation of the taxation and superannuation systems.
      3. Technical and special purpose consultation groups with limited life (they focus on specific issues that arise from time to time).
      4. The role of the ATO Consultation Hub in supporting the process
       

    To continue with the transition of this group to the new stakeholder group environment, the ATO discussed and invited feedback on the following issues.

    1. Changing our name to Superannuation Administration Stakeholders Group to reflect the role and diverse membership
    2. Adopting the principles of the ATO Protocol to provide underlying rules for our operation.
    3. Confirmed our focus and role of the group remains relatively unchanged. We maintain the relationship between the ATO and APRA Fund administration industry stakeholders to ensure the smooth running of the superannuation system. We do this by engaging with the right stakeholders on a regular basis (and as the need arises) to advise and discuss:
      1. significant systemic issues impacting:
        1. industry administrative processes, and/or
        2. the integrity of accounts and registers for the various super products;
         
      2. changes to ATO systems and processes; and
      3. fund readiness for super reform and other new measures impacting Fund to ATO or ATO to Fund reporting obligations
       

    We also accept and escalate issues for ATO consultation; and Undertake consultative processes on specific issues as required.

    Feedback from members on our role would be appreciated.

    1. The frequency of meetings:
      1. the consensus of members endorsed the value of face to face meetings (up to 4 a year) acknowledging the need to hold issue specific teleconferences as required.
      2. January and July are not suitable; need to factor in Industry-wide events e.g. ASFA conferences, etc., along with ATO events.
      3. current timing could be brought forward by several weeks
      4. video conferencing was not supported as a viable means of substituting the value of face to face meetings.
       
    1. Membership

    Currently capped at 25 and will be reviewed annually; need to maintain a balance of industry sectors.

    Analysis of the membership will assist to tailor audiences for issue specific teleconferences.

    Action item 18092013/01

    Review scheduling of meetings for 2014 to maximise membership interaction and ensure appropriate industry segments are identified to facilitate specific issue teleconferences with the appropriate audiences.

    Responsibility  

    SASG Secretariat

    4 Super Reform Readiness

    Grace Ng from Super Reform provided an update in relation to:

    • Rollover-in transition
    • SuperTICK

    4.1 Rollover-In Transition

    Induction

    1. Implementation of the Rollover-In Induction process is progressing well as reflected in daily Nerve centre website updates.
      1. 64 funds (from Group D 1 & 2) have completed induction including a Small APRA Fund (SAF) Trustee for approx.1900 SAFs. All have or are about to receive cross-certification.
      2. Inducted funds (including some represented by the audience) are already processing approx. 2,500 rollovers a week using the new standard. This volume expected to increase by 20 – 30 % per week as current funds ramping up their rollover processing are joined by newly inducted funds.
       
    2. Version 8 timetable was published last week (as at 11 September 2013) starting with Group 2 funds.
    3. Group 3 and 4 funds are scheduled to begin induction from Monday 23 September and 8 October respectively.
    4. There has been a very small number of funds that drop out of induction, but they have easily caught up with a minimum of disruption to the process.
    5. Additional guidance information (including updates from Daily Nerve Centre website, and Induction Group wrap-ups) is published to the Super Reforms webpage on the SILUExternal Link website.

    Key learning’s from the implementation include:

    1. Data arriving before payment. Funds have had to adjust to data arriving earlier than the money (which arrives at least 24 hours later due to current banking practice). Funds were accustomed to receiving payment first and then the rollover form or the form with cheque payment. Funds should allow for a short delay (1-2 days) before contacting the sender. The gap will be reduced between now and 2016 as the Banking sector move towards real time settlement.
    2. Fund Validation Service (FVS) - Incorrect bank account data. Following the release of FVS Version 6 last week (commencing Monday 9 September), a trustee advised their fund account details were incorrect. ATO action to notify funds included listing the error including fund details and Unique Superannuation Identifier (USI) on the Critical Issues of the Super Reforms webpage on the SILUExternal Link website. Funds were reminded to:
      1. ensure details for each USI (including bank account details) are correct
      2. monitor the critical issues section.
       
    3. Peer to peer testing. It is recommended that at least 3 cycles of peer to peer testing is undertaken to prior to entering induction, based on different gateways and source system implementations
    4. Additional guidance has been published to the Super Reforms webpage on the SILUExternal Link website covering:
      1. applying maximum severity to response messages
      2. how to use “mustUnderstand attribute” in the ebMS header; and
      3. how you represent 13, 1300 and 1800 telephone numbers in rollover messages.
       

    Heide Stewart highlighted several FVS issues:

    1. Are registered FVS users notified by email of errors with fund account details as they are identified (in addition to the updated Critical Issues web page)? Recent experience indicates no email is sent about incorrect fund account details
    2. A number of end dated fund records display Company ABN records and not the Superannuation Fund ABN. It is possible to update the guidelines or release notes to address this issue.
      Funds that maintain separate records for manual processing etc., so notifications of end dated accounts using Company ABN’s are missed.
    3. Product names standards on the FVS included a number of variations that are not Product Names e.g. “Small APRA Fund” or “Defined Benefit”. This impacts funds with in-house register that use the product name find the incorrect naming standard an irritant in the process.
    Action item 18092013/02

    ATO to assess and provide responses to issues raised by Heide Stewart regarding issues with the Fund Validation Service data.

    Responsibility  

    SASG Secretariat

    Garry Powell sought clarity on whether rollover issues are also being fed through to the general APRA fund information on ato.gov.au or is it just retained on the Super Reforms webpage on the SILUExternal Link website. A number of other members, highlighted that many FVS users accessing the SILUExternal Link webpage from SILU email updates were presented with a log in access code, (including the need to accept terms etc.) for which many do not have. This irritant renders funds (without access) unable to access the latest information.

    Action item 18092013/03

    ATO to assess issues raised regarding access to the SILU website and provide advice.

    Responsibility  

    SASG Secretariat

    The ATO advised members that the FVS updates would continue in xls format on a fortnightly basis until July 2014 when is expected to move to web service.

    4.2 SuperTICK

    Deployed in July 2013, the use of SuperTICK has grown significantly with 19 users covering 57 funds:

    • July - 29,000 transactions
    • August - 64,000
    • September - more than 200,000 to date

    Statistical analysis highlights:

    • a matching rate of 99%
    • corrected TFN have been provided to 0.3% of total requests.

    The rate of corrected TFNs indicates that annually, we will correct 30,000 – 40,000 TFNs that would ordinarily be lost and is a significant reduction in time taken by funds to undertake manual POI processes.

    Next year, APRA will be undertaking a data collection (on time and cost) exercise to benchmark the savings from using SuperTICK. However the ATO is keen to commence the conversation now.

    Action item 18092013/04

    Members invited to email SuperStreamStandards@ato.gov.au outlining experience with SuperTICK by 4 November 2013:

    • What were your experiences with using SuperTICK?
    • What sort of positive impact has it been on your operations?
     

    Responsibility  

    SASG Members

    Tips for using SuperTICK  

    Analysis of errors reported indicates the error rate is higher for new users attempting to:

    • establish connection to the service; or
    • sending their first validation requests

    There are a variety of error types that can be group as follows:

    1. Authorisation error. These errors occur for first time users, they generally occur because of Business Appointment or AUSkey issues and permissions. SuperTICK team proactively contacting funds to assist.
    2. Data Quality
      Content of message doesn’t comply strictly with the STIC schematron rules, for example:
      1. DOB where Year is prior to 1900;
      2. Invalid form of “Care of”; or
      3. Address has greater than 38 characters. It is highly recommended (but not compulsory) for developers to apply the rules to correct their own data before submitting a message; this will reduce the likelihood of users receiving error messages once submitted for validation by the ATO.
       
    3. Other key issues
      1. The production service can not be used to test data or test transactions. Users should only use the Service in accordance with the terms and conditions.
      2. The full name of member, TFN, Date of Birth, must be provided in the message. Address is optional.
      3. Individual must be a member of the fund reporting. ATO will monitor use of service.
      4. The SuperTICK “new member account functionality” was deployed mid July. The ATO is waiting for funds to implement this process to test the functionality.
       
    1. Other key issues
      1. The production service can not be used to test data or test transactions. Users should only use the Service in accordance with the terms and conditions.
      2. The full name of member, TFN, Date of Birth, must be provided in the message. Address is optional.
      3. Individual must be a member of the fund reporting. ATO will monitor use of service.
      4. The SuperTICK “new member account functionality” was deployed mid July. The ATO is waiting for funds to implement this process to test the functionality.
       

    Kelly Kerr sought clarification about the ATO confidence in whether a fund could record a member’s TFN as a valid TFN without the need to validate a member’s TFN through SuperTICK where after:

    • Member’s MCS is successfully lodged (no reject notified by resultant Outcome of lodgement Report (OOLR), and
    • No TFN notification (as listed below) is received (after April 2014 for 2012-13 MCS lodgement) for the member:
      • Please Resolve letter – ATO cannot match member details for member reported;
      • Sec 299TA Notice – ATO has identified a correct TFN for the member
      • Sec 299TC Notice – ATO has matched a TFN previously quoted in the superannuation system for the member.
       

    Such an arrangement would reduce duplicated effort by funds and the ATO in validating a member’s TFN through SuperTICK after the member record has been subjected to similar validation processes at the time of MCS lodgement.

    Action item 18092013/05

    ATO to consider and respond to the validity of funds treating a member TFN as a correct TFN (without validating the member through SuperTICK) where:

    • Member’s MCS is successfully lodged and no TFN Notification is received for that member
     

    Responsibility  

    Grace Ng

    Accepting that SuperTICK was not to be used for testing purposes, Heide Stewart raised concerns with the outcomes achieved through SuperTICK where:

    • the mandatory fields only were completed – Surname, Date of Birth, TFN – no result;
    • given name added to mandatory Fields – matched
    • completely different given name added to mandatory field – matched to previous test

    Funds are seeking additional comfort in understanding the risk associated with funds accepting ATO TFN Notification correspondence or SuperTICK where examples as discussed derive matches with incorrect information.

    Other members echoed similar concerns.

    Action item 18092013/06  

    Responsibility  

    Heide Stewart

    Anne Dixon discussed an example where the ATO has confirmed the same TFN was correct for two different members.

    Action item 18092013/07
    • Email SASGSecretariat@ato.gov.au with details of the ATO email interactions regarding the same TFN being confirmed for two different members.
     

    Responsibility  

    Anne Dixon

    5 Business Portal - File Transfer Function

    Linda Cheesman (Director, CAS Superannuation) provided an update in relation to the File Transfer function available through the ATO Business Portal.

    A number of funds have sought an update on the performance of the File Transfer function in the lead up to peak MCS lodgments towards the end of October 2013.

    The ATO advised:

    • The portal file transfer function was implemented earlier in 2013, and since July 2013 has been the only channel for electronic lodgment of the MCS
    • Funds have been reporting performance issues with the functionality and other associated issues ranging from AUSkey, Portal accessibility, etc.
    • There have been a number of enhancements implemented in recent weeks and days (prior to 18 September) to improve the performance. These include:
      • Doubling the number of servers to upgrade performance
      • Reductions to the internal system processes involving read/write activities that slow the process down
      • Memory capacity updated
      • Fine tuning of how CPU’s supporting the Database server are used to reduce delays and improve response times
       
    • Work on improving the performance is ongoing and we look forward to peak processing period in anticipation

    Members were asked to provide feedback to SuperCRT@ato.gov.au in regards to their recent experiences (both good and bad) when using the file transfer function. We are particularly interested in the client experience as we move closer to the 31 October deadline.

    Where possible, we will provide an update on any current trends in relation to the File Transfer functionality.

    Members highlighted a range of issues from:

    • Changes to File Validation Edits (ECI vs File Transfer).

    Members were advised that the File Transfer Validations implemented are unique and were not moved across from ECI. This may mean errors previously generated by ECI may not be applicable in File Transfer, and new errors may generate in File Transfer.

    • When should funds compress their files and how does it impact file validation and lodgment timeframes?

    Funds are advised to compress their files for uploading:

    • Validation will occur at uncompressed file speed, while
    • Timeframes to upload lodgments will be markedly improved

    Further information in relation to File Transfer functionality, file compression and timeframes to validate or lodge files can be found at the Frequently Asked Questions section of File Transfer available at ato.gov.au

    Note - Information published in this document regarding timeframes to validate or upload files may not reflect the current experience. Given the recent enhancements, it is expected that validation and lodgment timeframes will have improved from any previous experiences you may have had in July and August.

    • Is there a specific Validation Error Manual available to help users understand the error messaging?
    Action item 18092013/08

    Investigate and advise members on the range of validation error messages.

    Responsibility  

    Linda Cheesman

    • Search functionality on ato.gov.au to find relevant information on the file transfer functionality needs to be improved. The Chair acknowledged that as the ATO transitions to the new website format, many difficulties are being experienced by users attempting to access help information. We are working to improve the standard of service provided.
    • The ATO undertook to provide information to assist fund with File Transfer interactions.
    Action item 18092013/09

    Arrange for the search functionality within ato.gov.au to be improved, which will allow external users to find File Transfer information.

    Provide information to assist fund with File Transfer interactions

    Responsibility  

    SASG Secretariat

    Linda Cheesman

    6 Changes to ATO Systems

    6.1 Unclaimed Superannuation Money (USM) to Integrated Core Processing (ICP)

    David Jordan (Senior Director, CAS Super Reform) advised members of ATO plans to move USM to ICP, The majority of our Superannuation products are processed on this system.

    The change is intended to:

    • enhance our ability to deal and service electronically;
    • make the client experience straight forward, in reconciliation of payments and statements of accounts, immediate disbursement to individuals, and automate rollover of member USM accounts; and
    • facilitate payments by electronic funds transfer.

    The key impact of this change will be a large shutdown period of the legacy USM system from 8 November through until 1 January 2014, which will mean we can’t process any USM transactions (including electronic lodgements) during this time.

    Funds were advised:

    • to plan to lodge and pay USM Statements (including temporary residents) by 31 October 2013;
    • if funds become aware that they can’t meet this due date, please seek deferral early to ensure we understand the traffic during this time;
    • the Individuals Portal (SuperSeeker), DASP and SuperMatch will be available during this time but no processing of ATO held USM will be undertaken during the shutdown.

    Communications strategies to advise individuals, departing residents, etc., are planned.

    Our focus for start-up in January 2014 will be addressing any backlogged USM lodgements and payments, ATO held USM applications generated by the Individuals Portal, DASP and SuperMatch requests, etc.

    Changes that will become effective from January 2014 include:

    • A member’s USM entitlement will only become visible on-line (Individuals Portal) once the fund payment has been received, the member record matched, and the payment disbursed to the member’s ATO account.
    • Electronic channel initiatives including:
      • more stringent validations rules will apply for USM Statement lodgements;
      • changes to Electronic Reporting Specifications are either completed or in progress for:
        • Remittance Advice and Recovery Notice (RARN) will facilitate Recovery of overpaid USM amounts from Funds;
        • Payment Variation Advice (PVA) will allow funds to return payments of member entitlements or Recovery Notices that can’t be accepted; and
        • Outcomes of lodgement Reports.
         
       
    • Paper based USM statements will only permit 4 members to be reported.

    One of the key benefits is that the ATO will have system functionality to initiate and automate monthly rollovers of member USM entitlements to funds where relevant criteria have been met. Fund nominations will be used for the valid fund destination.

    Funds will be advised of member entitlement details through paper based Rollover Benefit Statements until we can move this to an electronic format.

    Aligned with the move from Legacy to ICP, USM Statement of Account (SoA) will become another account incorporated into the paper based ATO Superannuation SoA currently reporting on account activities for:

    • Co-contribution Remittances and PVAs;
    • Co-contribution Recoveries and PVAs
    • Superannuation Holding Account special account Remittances and PVA’s

    There is no plan to provide these SoA electronically at this stage.

    Examples were highlighted where monies paid to the ATO with the correct EFT codes have been re-directed upon receipt by the ATO to different account without explanation which has resulted in issues reconciling the USM account.

    Action item 18092013/10

    Review the circumstances of examples highlighted by Sue Pearce where USM monies have been split by the ATO upon receipt

    Responsibility  

    SASG Secretariat

    The ATO discussed a number of prepared Frequently Asked Questions.

    General discussion highlighted the following queries:

    • What is the timing on the delivery timeframe for payment, RBS and SoA?
    • Clarity is required on how will the RBS be delivered; how many RBS per envelope or all statements in one envelope? Concern exists about being able to reconcile RBS received to payment received.
    • How will the member RBS be linked to the fund payment?
      Will the RBS include the Customer Reference Number (CRN)? Funds highlighted concerns that the Data Standard requirement is that the payment and the data will be matched by a common reference number (Payment Reference number). Is the ATO using the current NAT 70944-03.2013 version of the RBS? Additionally, funds highlighted concerns that their systems have not been built to capture a CRN or Payment Reference Number as it is not on the approved form.
    Action item 18092013/11

    USM processing in ICP impacts to be listed on the agenda for the next meeting to provide an update on the administrative arrangements (including sample letters and notices) associated with monthly aggregated payments of member USM entitlements.

    Responsibility  

    SASG Secretariat

    Further questions raised by members included:

    • Will compensation payable from 1 July 2013 be lumped into RBS and is there any other reporting requirement?

    Yes, the interest component will be rolled up in the total of RBS and attributed by the ATO to the appropriate component. Compensation paid in relation to an incorrect Temporary Resident refund will be paid separately.  

    • Will the member know what interest they will see?

    Individuals will receive a letter explaining the amounts.  

    Kelly Kerr highlighted the importance of allowing sufficient time to consult with industry when the ATO commences thinking about moving the delivery of RBS from paper mode to electronic channel.

    6.2 Superannuation Guarantee (SG) to Integrated Core Processing (ICP)

    Michael Gleeson from Employer Segment, Superannuation, advised members of ATO plans to commence processing SG in ICP.

    SG processing for ICP will be a 2 phase deployment approach; there are a number of complexities and a large volume of work to get the process up and running in ICP.

    • First phase in December this year, with the second phase in March 2014.
    • SG processing and monthly payment processing will not be impacted by any system shutdowns; we will have the legacy system fully functioning for some time. It is not feasible to do complete conversion of data. This presents many issues for us as we continue to process in legacy, and start processing in ICP. There is some functionality that will not be available in ICP until March 2014.

    From March 2014, the ATO anticipate processing SG payments and associated correspondence (RARN and SoA) out of both Legacy and ICP for a transition period.

    • Activities in legacy will be progressive wound down over time with closure anticipated at a later date. The ATO will work with our stakeholders to do this.
    • Benefits provided by processing SG in ICP include capability to:
      • issue EFT payments for SG contributions
      • pay any value of member entitlements (no minimum amount threshold) to funds. Funds indicated they may have issues with small amounts ($0.01) being PVA’d
      • issue SoA (incorporated as one of several superannuation products in the paper based ATO Superannuation SoA) providing account information for Remittance payments and PVA’s, and Recovery Notices (including PVA’s):
      • undertake automated recovery action for SG amounts overpaid. Legacy system recovery processes had been very complicated, whereas ICP provides the capability. It is anticipated that the ATO will commence slowly and build this up with funds.
       

    Jeff Broderick queried whether the ATO will have to define a period in order to recover overpaid SG amounts?

    Action item 18092013/12

    Provide a response to the requirement for the ATO to define a period for the purposes of recovering overpaid SG amounts.

    Responsibility  

    Michael Gleeson

    • Timing of payments and recoveries will be considered carefully given there will be 2 payments and 1 recovery for many funds for several months, amongst other monthly Superannuation product payments. Separate RARN files will be issued along with:
      • ICP – (Remittance and Recovery) with potentially EFT payments, and a paper based SoA, while;
      • Legacy - will continue to only deliver the RARN (Remittance) file and a cheque payment.
       

    Member numbers paid through Legacy will reduce significantly, once monthly processing of payments is implemented in ICP. Funds indicated a preference to separate the release of the two payments by at least 1 week.

    The ATO confirmed that ICP SoA will commence with a zero balance on Remittance PVA’s and Recovery accounts. There will be no requirement for funds to reconcile previous Legacy payments, PVA’s, etc., with the first SoA issued.

    The ATO advised members that there is a program review underway of the SoA, including how to get to the availability of an electronic SoA format. They will take any learning’s from the impacts of the planned changes to processing systems into consideration.

    • Robert Hodge encouraged the ATO to ensure appropriate user consultation occurs to ensure that forms designed to be used by externals are fit for purpose.
    Action item 18092013/13

    Provide members with an outline of user issues identified that are being considered by the ATO review of SoA.

    Responsibility  

    Linda Cheesman

    Sue Pearce sought clarity on general interest charge (GIC) implications for larger funds that encounter issues with reconciliations of Superannuation payments, PVA’s and Recovery account that the paper based SoA does not adequately support. The ATO acknowledged the difficulty funds face in reconciling large volume member transaction, and advised:

    • funds have the obligation to process member transactions and reconcile their account balances in a timely manner, using the mechanisms available including ATO issued OOLRs and SoA.
    • instances where funds seek remission of GIC due to issues with reconciliation of large member transactions would be considered on a case by case basis.
    Action item 18092013/14

    SG processing in ICP impacts to be listed on the agenda for the next meeting to provide an update on the administrative arrangements (including sample letters and notices) associated with monthly aggregated payments and recovery of member SG entitlements.

    Responsibility  

    SASG Secretariat

    7 Product Update – TFN Notifications

    Jamie Mendyk (Superannuation) provided members with a brief overview of the plans for TFN Notifications in 2014.

    Funds may be aware:

    • the ATO will not be sending TFN Notifications for any for 2012-13 MCS lodgements until April 2014. This will avoid duplicate notices being issued when system changes are implemented early in 2014.
    • new legislative arrangements allow the ATO to notify funds of an individual’s TFN (not previously quoted by that fund) but has been identified as being quoted previously for Superannuation purposes. (Sec 299TC).
    • in April 2014, the ATO will issue the backlog of TFN notifications (Sec 299TA, Sect 299TC and Please resolve letters) will be issued manually in bulk, and recommence the automated issue of these notices (55 days after the MCS lodgement date) .

    The ATO has revised the TFN Notification electronic reporting specifications to better notify funds of the type of notice being sent.

    Member feedback highlighted concerns that the draft changes proposes to use the “version number” as means for funds to identify the Notification file contains Sec 299TA, Sec 299TC, or please resolve letter data.

    Action item 18092013/15

    Review the TFN Notification electronic reporting specification to address member concerns that the proposed means to identify the file contains either Sec 299TA or Sec 299TC Notifications or Please resolve letter candidates.

    Responsibility  

    Jamie Mendyk

    8 Reuniting Super Update - LMR

    1. LMR full Re-report timing
    2. Provision of updated addresses

    John George (Director, Funds Segment, Superannuation) provided an update to members on several key issues relating to LMR.

    8.1 Timing of LMR Re-report

    The ATO advised members of our plans to schedule the next full LMR re-report in April 2015.

    Industry representatives were comfortable with this decision.

    Feedback from members centred on how soon could Funds move to the full LMR re-report as the regular 6 month reporting mode, rather than the existing on/off incremental reporting. The ATO advised it would be looking to move to combined MCS/LMS/USM reporting in the short-medium term after the April 2015 re-report.

    8.2 Provision of Address

    Funds had been provided with a request to undertake some preparatory research within their organisation to address the following questions:

    1. What actions do funds take when they receive the ATO’s updated member information?
      1. Some funds do a bulk upload of our file and then filter it with some criteria (e.g., to exclude inactives, ERF accounts less than $10,000) and then will update the address where it is different from their existing records.
      2. Some undertake mail-outs up front when they receive the data file
      3. Some undertake mail-outs once they have updated the address.
      4. Some update the address in their system immediately then send a confirmation mail to the member at the new address.
       
    2. For the accounts where funds are able to locate the member, are funds generally able to remove these “found” accounts in the same reporting period, or the next reporting period?
      1. All funds with the exception of one fund indicated that they remove the accounts in the same period and recognise this as a requirement. The other fund was under the impression that they were OK to remove these in the next subsequent reporting period.
      2. The only issue impacting on this was the timing of when the ATO issues the data - the funds prefer it to issue in January and July which would allow sufficient time for them to take appropriate action and remove records in the same reporting period.
       
    3. Where funds are unable to remove “found” accounts, what additional information is required from the ATO to ensure these accounts are removed in the next reporting period?
      1. Some funds suggested that if the ATO holds phone/e-mail details, this would be of great benefit to them.
      2. Some funds asked if the ATO could provide the member account number/client ID - although we responded that we thought these details have been included in recent runs.
      3. A couple of funds also indicated that the suburb and postcode details provided by the ATO do not match in a small amount of instances.
       
    4. If funds are not generally acting on these updated data files, what are the reasons? Most funds indicated that where the ATO have provided updated addresses in respect of inactive members, they do not write to these members due to the costs involved in doing this. These funds suggested that the ATO potentially could seek a law change to remove the requirement for contact in these cases.
    5. Given that the ATO already provides updated addresses, details of deceased members and details of members over age 65 years, is there any other information held by the ATO that could help funds locate lost members? A couple of funds asked if the ATO would consider providing addresses specifically for lost members who have reached 65 years of age.
    6. Would funds benefit from other forms of assistance to help with future reporting (e.g., visits, education sessions)?
      1. A couple of funds asked if the ATO would consider contacting lost members with high balances.
      2. Many funds gave positive feedback about reporting education sessions run in the past by the ATO and would like the ATO to re-energise these again for LMR and USM. These should include examples of what reporting issues the ATO is seeing, and other scenarios/examples. These funds also suggested using a "webinar" video conference facility to deliver given that many funds have staff posted in different states.
       

    9 Other Business – Issues raised from members

    9.1 Temporary Resident (Sec 20C) Notifications, reporting and guidance materials

    Members highlighted a number of issues:

    • April 2013 USM reporting requirement for transferred Sec 20C members has impacted the integrity of the August Sec20C notifications.
      • Eion Burke highlighted incorrect transfer information (i.e. Destination Fund ABN) included in fund USM reporting for this period, has resulted in the ATO incorrectly issuing numerous Sec20C to the Fund’s Trustee. The ATO advised funds receiving Sec 20C notifications to email the detail to SuperCRT@ato.gov.au for the notice to be revoked. Future Sec 20C processes will identify the correct destination (given the expanded MCS reporting requirements for 2012/13 year).
      • The absence of the transferred member’s account number at the destination fund has led to a shortfall in the additional information provided with the Sec20C notice. Funds highlighted this meant they had concerns in matching the member. ATO advice received was for the fund to report the member with code “I” insufficient information to identify the member.
       
    Action item 18092013/16

    Provide email confirmation to advice funds receiving Sec 20C notifications issued to the incorrect entity (i.e. the fund’s trustee) to email the detail to SuperCRT@ato.gov.au for the notice to be revoked.

    Responsibility  

    SASG Secretariat

    Guidance material clarity required - members where contributions received in the last six months. Heide Stewart recommended changes to ATO available material (e.g. USM Protocol, QandA, etc) to provide greater guidance content for users that do not have the historical knowledge of previously issued QandA, old reporting requirements (e.g. status code “S” being removed), etc Sue Pearce confirmed concerns about the extent of QandA content issued in previous years that is not featured in current materials.

    Action item 18092013/17

    Arrange for a review the USM protocol and examples raised to identify the shortfalls in guidance as discussed.

    Responsibility  

    SASG Secretariat

    9.2 Low Income Superannuation Contribution (LISC)

    Sally Druhan advised members that the ATO:

    • has been proceeding with preparations for monthly LISC payment processing to be commence.
    • has been working through the results of a limited release pilot of LISC payments during August, and
    • has determined it is are not ready to commence with monthly processing due to a number of technical issues.

    Funds involved with the August payment pilot that have received a payment but not yet received the RARN file should contact SuperCRT to determine how to proceed.

    Further information on commencement of monthly LISC payment processing will be provided at the earliest opportunity.

    Sue Pearce sought clarity on the requirement for funds to separately identify member LISC contributions on member statements.

    Action item 18092013/18

    Ascertain the requirements for funds to separately identify member LISC payments for member statement reporting.

    Responsibility  

    SASG Secretariat

    9.3 ASIC interest paid on refunded USM payments to funds

    Several members highlighted USM amounts being returned by ASIC are now being received with a component of interest.

    Recent ATO advice regarding the correct treatment (concessional or non-concession) and the correct MCS field reporting requirements has been revoked.

    Action item 18092013/19

    Ascertain the current ATO position regarding the correct treatment and reporting of ASIC interest paid on unclaimed superannuation amounts/refunds

    Responsibility  

    SASG Secretariat

    9.4 Request for ATO to develop a Kiwi Saver Rollover Form

    General discussion by members confirmed the ATO decision not to develop a fund to fund Rollover Form for KiwiSaver account transfers.

    • Each fund’s Trustee may require different processes and evidentiary requirements for transfers that limit the effectiveness and usability of a generic rollover form.

    9.5 Unclaimed Superannuation Money (USM) statistics

    Alan Harvey requested information to be provided in relation to the value of collections of unclaimed superannuation money.

    John George advised this information will be included in the ATO Annual Report, and can be provided after publishing of the Report.

    Action item 18092013/20

    Provide members with a report on the Unclaimed Superannuation Money collection statistics

    Responsibility  

    John George

    9.6 Division 293

    Discussion centred on:

    • the challenging 7 day timeframe for funds to process certain categories of Release authorities given organisational logistics (including carriage of Authority from remote mail processing to account processing areas, etc).
    • no update available on the progress of associated Regulations through Parliament. Funds expressed concern that the delays experienced and the timeframe required for the associated actuarial guidance for Defined Benefit Scheme members, will mean amended 2102-13 yr MCS reporting will be undertaken as fund are lodging 2013-14 MCS.
    Action item 18092013/21

    An update on Division 293 to be scheduled for the next meeting.

    Responsibility  

    SASG Secretariat

    9.7 Electronic Portability Form – Fund Readiness

    Suresh Soppa sought feedback from members on their readiness to accept the EPF through the Business Portal.  CRT Alert highlighted implementation will occur from 23 September 2013.

    General discussion highlighted concerns with meeting the 3 day turnaround standard:

    • the change in delivery channel adds no value to most funds processing capability:
      • the current channel (ECI) provided a printable version that is manually processed; whereas
      • the new channel message (xbrl format) is not acceptable through the gateway, most funds are doing a short term conversion product to deliver.
       
    • Shortfalls in data contained:
      • Receiving fund name not present
      • Absence of the Unique Superannuation Identifier
       

    Other issues raised included:

    • Trustee reluctance to process applications without supporting POI.
    • requirements to SuperTICK the applications
    • confusion for funds with the earlier implementation date as outlined in CRT Alert; will there be any more EPFs issued by ECI?

    Robert Hodge clarified for members that:

    • funds do not have to apply further POI processes
    • discussions with APRA indicate that funds should design their process to enable them to meet the 3 day standard (SIS requirements), typical situation that would or would not require Breach reporting, etc
    Action item 18092013/22

    ATO to provide clarity around the EPF implementation date, SuperTICK and POI concerns.

    Responsibility  

    SASG Secretariat

    9.8 Departing Australia Superannuation Payments (DASP)

    John George advised members that feedback from DIAC indicates that many individuals lodging their DASP application electronically are being asked by funds to obtain documentation from DIAC to support their application. The documentation requirement is already met for individuals applying electronically (through interactions between ATO and DIAC systems).

    Members were asked to consult with their colleagues to ensure that electronic DASP applicants are not being directed to DIAC to obtain this information.

    Action item 18092013/23

    Consult with your colleagues to ensure that electronic DASP applicants are not being directed to DIAC to obtain proof of departure information.

    Responsibility  

    SASG Members

    10 Close

    Sally Druhan thanked all attendees for their contribution to a very successful meeting.

    The next meeting is scheduled for Wednesday 4 December 2013.

    Summary of action items from this meeting

    Reference Action Item Allocated To

    18092013/01

    Review scheduling of meetings for 2014 to maximise membership interaction and ensure appropriate industry segments are identified to facilitate specific issue teleconferences with the appropriate audiences.

    SASG Secretariat

    18092013/02

    ATO to assess and provide responses to issues raised by Heide Stewart regarding issues with the Fund Validation Service data

    SASG Secretariat

    18092013/03

    ATO to assess issues raised regarding access to the SILU website and provide advice.

    SASG Secretariat

    18092013/04

    Members invited to email SuperStreamStandards@ato.gov.au outlining experience with SuperTICK by 4 November 2013:

    What were your experiences with using SuperTICK?

    What sort of positive impact has it been on your operations?

    SASG Members

    18092013/05

    ATO to consider and respond to the validity of funds treating a member TFN as a correct TFN (without validating the member through SuperTICK) where:

    Member’s MCS is successfully lodged and no TFN Notification is received for that member

    Grace Ng

    18092013/06

    Email SASGSecretariat@ato.gov.au with details of the member outcomes achieved through an interaction with SuperTICK.

    Heide Stewart

    18092013/07

    Email SASGSecretariat@ato.gov.au with details of the ATO email interactions regarding the same TFN being confirmed for two different members.

    Anne Dixon

    18092013/08

    Investigate and advise members on the range of validation error messages.

    Linda Cheesman

    18092013/09

    Arrange for the search functionality within ato.gov.au to be improved, which will allow external users to find File Transfer information.

    Provide information to assist funds with File transfer interactions

    SASG Secretariat

    Linda Cheesman

    18092013/10

    Review the circumstances of examples highlighted by Sue Pearce where monies have been split by the ATO upon receipt.

    SASG Secretariat

    18092013/11

    USM processing in ICP impacts to be listed on the agenda for the next meeting to provide an update on the administrative arrangements (including sample letters and notices) associated with monthly aggregated payments of member USM entitlements.

    SASG Secretariat

    18092013/12

    Provide a response to the requirement for the ATO to define a period for the purposes of recovering overpaid SG amounts.

    Michael Gleeson

    18092013/13

    Provide members with an outline of user issues identified that are being considered by the ATO review of SoA.

    Linda Cheesman

    18092013/14

    SG processing in ICP impacts to be listed on the agenda for the next meeting to provide an update on the administrative arrangements (including sample letters and notices) associated with monthly aggregated payments and recovery of member SG entitlements.

    SASG Secretariat

    18092013/15

    Review the TFN Notification electronic reporting specification to address member concerns that the proposed means to identify the file contains either Sec 299TA or Sec 299TC Notifications or Please resolve letter candidates.

    Jamie Mendyk

    18092013/16

    Provide email confirmation to advice funds receiving Sec 20C notifications issued to the incorrect entity (i.e. the fund’s trustee) to email the detail to SuperCRT@ato.gov.au for the notice to be revoked

    SASG Secretariat

    18092013/17

    Arrange for a review the USM protocol and examples raised to identify the shortfalls in guidance as discussed.

    SASG Secretariat

    18092013/18

    Ascertain the requirements for funds to separately identify member LISC payments for member statement reporting

    SASG Secretariat

    18092013/19

    Ascertain the current ATO position regarding the correct treatment and reporting of ASIC interest paid on unclaimed superannuation amounts/refunds

    SASG Secretariat

    18092013/20

    Provide members with a report on the Unclaimed Superannuation Money collection statistics

    John George

    18092013/21

    An update on Division 293 to be scheduled for the next meeting

    SASG Secretariat

    18092013/22

    ATO to provide clarity around the EPF implementation date, SuperTICK and POI concerns.

    SASG Secretariat

    18092103/23

    Consult with your colleagues to ensure that electronic DASP applicants are not being directed to DIAC to obtain proof of departure information

    SASG Members

      Last modified: 31 Jan 2014QC 38326