ATO’s Investment Strategy Breach Project

4 Sep 2019

Written by

David Busoli, Principal

The ATO’s letters to over 17,000 funds with “90% or more of its funds in one asset, or a single asset class”, have started to arrive. A similar letter will be sent to the last known auditor for each fund.

It draws the trustee’s attention to a potential $4,200 penalty and puts the auditor on notice to focus quite specifically on the investment strategy for each of these funds. Undoubtedly it will also give auditors cause to pay more attention to the investment strategies of all other funds as well.

The ATO seem to be prepared to overlook breaches where funds have already been audited as the letter specifically states “Have your investment strategy ready to provide to your SMSF’s approved auditor as part of your next audit.”  It further states that “..if your auditor identifies that you have failed to rectify any non-compliance with the requirements listed above; this could result in the imposition of the above mentioned penalties.”

Users of our Investment Strategy tool within our SMSF Toolbox should have no difficulty in meeting the standards.

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