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I am engaged to audit a newly created smsf for first time 2023
the client is a practising accountant (2 member including spouse).
The accountant , the male member of the fund has prepared the accounts and tax return for the year.
the accountant member has billed the fund for work done on the fund The fee seems reasonable .
Ques is there any possible issue here?non arms length ?. If it was out sourced a fee would be charged for accounting etc.
thank you
Hi Mike
As a starting point a trustee cannot be remunerated for any service provided to the Fund per section 17A of SIS.
It is section 17B of SIS however that provides an exception as it states that a trustee can be remunerated for services if:
the trustee peforms the duty not in a trustee capacity,
the trustee is appropriately qualified & holds all licenses to provide that service,
the trustee provides that service to the public, and
the remuneration is paid on an arm's length basis.
That is section 17B allows the practicing accountant to charge a fee for the accounting work on the basis that this is considered a non trustee role, he is a qualified accountant, he has an accounting business that provides this service to the public and the remuneration is charged on an arm's length basis.
Thanks
The Auditors Institute