Comparing SMSF To Other Super Funds
Members and Trustees
An SMSF can have a maximum of four members. Members are either individual trustees or directors of a corporate trustee of the fund. All members are involved in managing the fund.
In other super funds, there is no limit to the number of members who can join. However, only professional and licensed trustees are responsible for managing the fund.
Responsibility
In an SMSF, trustees are expected to have knowledge of super laws and must comply with the laws that govern it. Breaches of SMSF laws may be the cause of fines and penalties that the trustees have to pay.
For other super funds compliance risks, they are to be handled by a professional licensed trustee.
Investments
In an SMSF, trustees develop and implement investment strategies for the fund and make all investment decisions. Other super funds allow some control over the mix and risk level of super investments but generally, you will not be allowed to choose the specific assets on which they can invest in.
Insurance
In an SMSF, trustees must consider purchasing insurance for their members. However, insurance premiums for SMSF members may be higher than other superfunds. Other funds mostly offer insurance to members. They usually cost less because large funds can get discounts on premiums.
Regulation
SMSFs are regulated by ATO and trustees are required to engage with ATO to manage the fund. Other super funds are regulated by APRA, but generally, members do not have to be in touch or engage with APRA.
Complaints and Disputes
In SMSF, ATO is not involved in resolving a dispute among members. Disagreements can be resolved in court or through alternative dispute resolution techniques at the members’ expense. There is no government compensation scheme.
In other super funds, members have access to the Superannuation Complaints Tribunal and could be eligible for legal compensation.
Fraudulent Conduct or Theft
There is no government financial assistance available to SMSFs. There are legal options for members under the Corporations Law but there are no guarantees that the compensation will be awarded to the members.
For other super funds, member are eligible for government financial assistance when faced with fraud or theft.
It is also important for self-managed super fund members to have an SMSF auditor, to make sure all financial statements are with accordance to the law.
Kingston Knight Audit are the Auditor Melbourne experts to contact when dealing with your trust account audit, SMSF Audit, financial statement audit, and internal audit requirements. Contact us today, Kingston & Knight Audit offers a free telephone consultation to establish how we can best help you achieve the assurance and compliance you require.
Call our Melbourne team today on 03 9088 2242, or email us via audit@http://kingstonknightaudit.paulkanewebdesigns.com/wp-content/uploads/2016/12/business-accountant-melbourne.jpgknightaudit.com.au.
