In some cases, Ms Schaefer said auditors are getting some pushback from trustees because they might have had the property valued or appraised at 30 June 2020. 

"I know auditors are saying well if you're saying it hasn't increased from June 2020, then [you still need] to get confirmation from the person who did the appraisal that the value is still relevant and is still current because there will absolutely be examples where property prices haven't changed, but auditors are not property agents," said Ms Schaefer. 

Property valuations for SMSFs have been an area of focus for the ATO and auditors for a number of years, with the regulator releasing various pieces of guidance on what SMSFs need to provide to their auditor in order to comply with regulation 8.02B of the Superannuation Industry (Supervision) Regulations 1994. 

Evolv audit associate director Daria Galstyan told SMSF Adviser in August that while many of the requirements for property valuations are straightforward, some transactions can be more of a grey area.

The required evidence, Ms Galstyan explained, may become problematic when there are transfers of properties in and out of the fund between related parties. 

“Most trustees utilise a direct sales or market comparison approach to support the market valuation of property,” she said.

“For commercial properties, the issue is the lack of readily available market data, with some properties also being special purpose in nature. It can be quite difficult for the trustees to actually determine market value without seeking assistance from a commercial real estate specialist or a registered valuer.”