What happens if I think my SMSF auditor hasn't done their job properly?

In Plain English

If you believe your Self-Managed Superannuation Fund (SMSF) auditor hasn't adequately performed their duties, the Superannuation Industry (Supervision) Act 1993 provides a framework for addressing this.

The Australian Taxation Office (ATO) can refer details of the matter to ASIC. ASIC can then disqualify or suspend an auditor if they have failed to perform their duties adequately, failed to comply with conditions on their registration, made false declarations, or are otherwise not a fit and proper person.

Detailed Explanation

The Superannuation Industry (Supervision) Act 1993 outlines the process for dealing with inadequate performance by approved SMSF auditors.

Disqualification or Suspension:

• Under section 130F, the Regulator (ASIC) can disqualify a person from being an approved SMSF auditor or suspend their registration if certain conditions are met. These conditions include:

  • Failure to adequately perform duties as an auditor under the Superannuation Industry (Supervision) Act 1993 or any other relevant law (Superannuation Industry (Supervision) Act 1993 chunk 216, Superannuation Laws Amendment (Capital Gains Tax Relief and Other Efficiency Measures) Act 2012 chunk 8).
  • Failure to comply with conditions imposed on their registration (Superannuation Industry (Supervision) Act 1993 chunk 216, Superannuation Laws Amendment (Capital Gains Tax Relief and Other Efficiency Measures) Act 2012 chunk 8).
  • Making a false declaration in their application for registration or in statements given to the Regulator (Superannuation Industry (Supervision) Act 1993 chunk 216, Superannuation Laws Amendment (Capital Gains Tax Relief and Other Efficiency Measures) Act 2012 chunk 8).
  • Not being a fit and proper person to be an approved SMSF auditor (Superannuation Industry (Supervision) Act 1993 chunk 216, Superannuation Laws Amendment (Capital Gains Tax Relief and Other Efficiency Measures) Act 2012 chunk 8).

Commissioner of Taxation's Role:

• The Commissioner of Taxation can refer details of a matter to ASIC if they believe an approved SMSF auditor hasn't performed their duties adequately (Superannuation Laws Amendment (Capital Gains Tax Relief and Other Efficiency Measures) Act 2012 chunk 8).
• If the Commissioner refers a matter to ASIC, they must inform the auditor in writing within 14 days about the referral and the nature of the matter (Superannuation Laws Amendment (Capital Gains Tax Relief and Other Efficiency Measures) Act 2012 chunk 8).

Regulator's Actions:

• If the Regulator decides to disqualify or suspend an auditor, they must give a copy of the order to the person (Superannuation Industry (Supervision) Act 1993 chunk 216, Superannuation Laws Amendment (Capital Gains Tax Relief and Other Efficiency Measures) Act 2012 chunk 8).
• The order takes effect on the day specified in the order, which must be within 28 days of the order being made (Superannuation Industry (Supervision) Act 1993 chunk 216, Superannuation Laws Amendment (Capital Gains Tax Relief and Other Efficiency Measures) Act 2012 chunk 8).
• The Regulator must publish a copy of the disqualification order as soon as practicable after it is made (Superannuation Industry (Supervision) Act 1993 chunk 216, Superannuation Laws Amendment (Capital Gains Tax Relief and Other Efficiency Measures) Act 2012 chunk 8).

Revocation of Disqualification:

• The Regulator can revoke a disqualification order if satisfied that the person is likely to perform their duties adequately and is a fit and proper person (Superannuation Industry (Supervision) Act 1993 chunk 216).

This framework allows for action to be taken against SMSF auditors who fail to meet their obligations, helping to protect the integrity of the SMSF system.