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Dawood Hassan

Jan 30, 2023

Edited: Jan 30, 2023

in SMSF Technical Forum

I have received a newly setup SMSF for audit for 2022 financial year. initially, two members rolled over $350,000 from their industry super funds.

The SMSF lent $300,000 on 3rd of June 2022 to a non related trust for the development of the properties for 6 months loan period with an option to extend the period of loan for another 6 months should the borrow elect to do so. initially, there is no Caveat lodged by the SMSF (Lender) on the properties being developed but the lender has the right to lodge a Caveat in the event of default. Since the loan is not secured initially and its 85% of the fund total assets I am hesitant to issue an unqualified report and I am also going to raise this issue in the managemnt letter.

Just wondering am I thinking along the right lines, is this also breach of any section of the SIS Act, do I need to lodge a contravention report?