In September, the ATO outlined plans to change the SMSF annual return so that it also captures the details of the professional preparing the accounts for the fund.
Speaking in a recent Chartered Accountants Australia and New Zealand video, ATO director Kellie Grant explained that due to the design of the SMSF annual return at the moment, it is difficult for the ATO to determine who prepared the accounts.
“The auditor is reported and the tax agent is reported, but even if the auditor is working at the same firm as the tax agent, it doesn’t necessarily mean that the accounts were prepared by that particular firm. They might have been outsourced to an administration firm [for example],” Ms Grant said.
By capturing the details of the professional preparing the accounts, this will enable to ATO better determine what firms are conducting in-house audits and monitor compliance with the restructured code and APESB independence guide, she said.
“We did try to actually change the label for the 2021 return so that we could start capturing information about who is preparing the fund’s accounts, but we just didn’t get that through in time, so we will try for the next financial year,” she said in the video.
The ATO has previously established that while it will undertake a transitional approach in relation to the auditor independence standards for the 2020–21 income year, audits completed after 1 July 2021 will need to comply.
I trust that if they are seeking to know who prepared the financial accounts, it will include an option for ‘prepared by the trustee’. In about 2% of the funds I audit, the financials are prepared by the trustee. There are several of these where I do lodge the Annual return based on the information provided.