Keeping good records
Keeping good records is more than just knowing which records to keep and for how long. It also includes setting up systems and maintaining records in a way that makes it easier for you, and any SMSF professional you use, to help lodge your fund's annual return and complete the fund's independent audit each year.
Keeping your records in order may help you save money on audit and fund administration costs.
You may want to establish a system which separates your fund's more permanent records from the records that relate to a specific financial year. For example, in your permanent file you may want to keep:
- the fund's trust deed
- the fund's investment strategy
- details of the regular reviews of the fund's investment strategy, including the consideration of insurance for members of the fund
- reasons for decisions on the storage of collectables and personal use assets
- minutes of trustee meetings
- all signed trustee declarations
- records of trustees consenting to their appointment as a fund trustee
- records of all changes in fund members and trustees.
Keeping these records together will simplify the process of compiling the records you need to give to your fund's independent auditor. If your fund regularly holds trustee meetings, you could establish a separate folder for them, sorting them by date order.
The most important reason for keeping good records is that it's a legal requirement for you to do so.
Other reasons for keeping good records of your fund's activities include:
- making it easier for you or your super professional to complete your fund's annual return
- monitoring the financial situation of your fund to assist you making sound investment decisions
- making the best use of any professionals you engage.
You need to ensure you keep the documents you have used to prepare your fund's annual return. You need to keep documents that:
- explain how your fund's income has been generated
- explain your fund's deductible expenses
- are used to prepare your fund's returns, accounts and statements
- are used to calculate your fund's income tax liability
- are used by an independent auditor to determine how your fund has complied with the super laws.
As each self-managed super fund is unique, with its own investment strategies to achieve its objectives, we recommend that you consult with a professional licensed adviser when setting up a record-keeping system that suits your fund.
For more information, refer to Record keeping for small business (NAT 3029).