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I am auditing a fund in which a rollover occured within the financial year being audited. In relation to regulation 6.17, we must obtain sufficient appropriate evidence that rollovers were conducted via SuperStream. The ATO list the following as sufficient appropriate evidence: Where the SMSF is the receiving fund, you need to obtain evidence confirming:
Where the rollover request was received by the SMSF directly from the member, the SMSF used SuperStream to request the rollover from the transferring fund. Evidence could include a
printout of the 'initiate rollover request' (or equivalent) message from the receiving fund's SMSF messaging provider.
The rollover was allocated to the member within 3 business days after the fund received the rollover payment and the message containing all the information required to enable it to occur. Evidence could include
bank/member account and transaction details
a printout of the 'rollover transaction request' (or equivalent) message from the transferring fund's SMSF messaging provider.
The trustees of a fund I am auditing are having difficulty obtaining the rollover request document from their ESA, which is the evidence we are required to obtain according to the ATO. It is clear the fund has an ESA and a rollover occured, but the trustees do not know how/are unable to obtain and provide the relevant evidence.
Will a qualification of Part B suffice, or must a contravention report be lodged as well if the value of the rollover meets the ACR threshold?
Thank you.
It is getting hard and hard to get the copies of roll over if it is through ESA provider. Super Fund says talk to ESA provider and they are not helpful.
Hi Jason
Thanks.
As a starting point I assume you have not been able to obtain a copy of the rollover statement. If you have not been able to obtain the rollover statement how does the accountant / auditor know to which it member it relates and what part of the rollover is either tax free or taxed (or untaxed). This may also lead to a Part A financial audit report qualification.
Yes if you cannot verify that the rollover has complied with the SuperStream requirements then if material you should qualify re SIS regulation 6.17 that requires:
“Payments of member benefits must be made in accordance with Part 6 or Part 7A of the regulations and be permitted by the trust deed”.
Yes if it meets the criteria of the Auditor Contravention Report (ACR) reporting criteria then you should lodge an ACR (& advise the trustee of the breach of SIS in writing).
I note that it is mandatory for SMSFs to use SuperStream for rollovers to and from Funds from 1 October 2021.
The ATO announced a temporary measure that commenced from 16 March 2022 and that:
• “Using a paper form to conduct a rollover outside SuperStream on or after 1 October 2021 without first seeking our approval is a reportable breach of the SuperStream rules”.
• A SMSF trustee “can request to undertake the rollover outside SuperStream. We will confirm over the phone that you can use the paper process used for rollovers prior to 1 October 2021 and make a record of the approval”.
• An “auditor will not be required to report a contravention to us where you have received our approval to make the rollover outside SuperStream. This is a temporary measure put in place to help facilitate SMSF rollovers.”
• This temporary relief “process is available only for rollovers from a SMSF and between SMSFs.”
On 12 April 2023 the ATO announced that from 1 July 2023 temporary relief re rollovers via paper stops. That is from 1 July 2023 all rollovers must be done electronically via SuperStream, refer:
https://www.ato.gov.au/Super/SMSF-newsroom/Running-an-SMSF/Rollover-relief-ending-30-June/
I note that most rollovers done via SuperStream for SMSF's are done in either BGL 360, Class or Supermate (being the major SMSF software providers).
An extract of a BGL 360 rollover (that can be printed) received via BGL SuperSteam:
Thanks
THE AUDITORS INSTITUTE