ATO tipped to demand more data from admin firms
Further enhancement in administration platforms could see the ATO demanding more detailed and granular data from SMSF administrators to perform better analysis, according to a technology consultant.
Speaking to SMSF Adviser, Smithink founder David Smith said the trends around big data and data analytics continue to grow in prominence with the larger administration platforms looking to further harness this information to provide greater intelligence to trustees about their funds.
“The [larger administration platforms] are building big data bases of SMSFs that could be mined to unblock more intelligence about how funds are performing and what are the key factors that are being used to drive better-than-average performance.
“As the admin platforms continue to be enhanced, the ATO or the regulators generally could start demanding more detailed and granular data to allow them to do a better analysis of what’s happening inside these funds,” said Mr Smith.
Mr Smith said the ATO would have to move slowly on this, however, as there is a large number of SMSFs that are still not on these sophisticated admin platforms.
“If the regulator moved too quickly down that road, it could overburden those funds that are not using these platforms and make it very expensive to actually comply with those requirements,” he said.
SMSF practices and their clients, he said, could be forced to move funds onto these larger administration platforms should the government decide to make further policy changes to super.
“The danger is that any changes in policy could make everything much more complicated and difficult to comply with,” he said.
“That in itself could drive people to use the more sophisticated platforms to comply with the more complex requirements that could emerge out of any legislative change that might be required for political purposes.”