Oct 2017 2 Minutes
SMSF Auditor Responsibilities
The role of the auditor is an important one. The auditor’s job is to examine your SMSF’s financial reports and to assess the SMSF’s compliance with superannuation law and regulations. A SMSF auditor must be registered with the Australian Securities and Investment Commission (ASIC) and have completed the minimum competency requirements to conduct SMSF audits. Being a good SMSF auditor requires a comprehensive knowledge of the complex superannuation laws.
There are a number of low cost audit services being offered, which initially appear to be a good deal, but in the long run it could be very costly if important compliance matters are missed by the auditor. The ATO can easily identify how much a SMSF is charged for their audits, as it is a separate declaration item in the income tax return and can be easily data matched with the auditor, which is also declared on the tax return. The Australian Taxation Office (ATO) is aware of these low cost services and has implemented a program where they are investigating these auditors. Their investigations centre around the quality of the work completed, the ATO is well aware of the level of work involved in an audit and are suspicious that these low fees reflect the level of work prepared by the auditor.
The ATO have that found corners have been cut and incorrect work papers, files and records have been kept. Through their investigations they have found some auditors failed to conduct an appropriate audit that complied with the relevant auditing standards prescribed by law and accounting bodies.
If a SMSF prepares an incorrect income tax return then this may result in the SMSF becoming non compliant. This may give rise to a penalty tax rate of 45% due to its non compliance instead of the tax rate of 15% for a complying fund and there are also a number of other penalties for non compliance. Trustees of the SMSF are responsible in ensuring that their fund is compliant.
Here at Walker Wayland we ensure no corners are cut and all our work is prepared as per all current law requirements. We value our motto Total Solutions, Peace of Mind. Our auditors are fully qualified with many years of experience, so you can count on us to provide you with the best service.