Release of QAR may prompt review of SMSF guidance
While ASIC has only recently revised its SMSF advice guidance, it may require further updates once the final report of the Quality of Advice Review is released by the government.
Last month, ASIC released updated guidance on SMSF advice, revising its previous guidelines concerning minimum balances for SMSFs.
ASIC released Information Sheet 274 which consolidated and replaced two previous information sheets, INFO 205 and INFO 206. This information sheet helps Australian financial services (AFS) licensees and their representatives comply with their obligations when providing personal advice about SMSFs.
The updated guidance was welcomed by the SMSF industry groups such as the SMSF Association with the guidance removing references to a $500,000 threshold for establishing a fund and stressing the importance of advisers having SMSF specialist knowledge.
However, with Michelle Levy handing down the final report of the Quality of Advice Review to the government last month, CA ANZ superannuation and financial services leader Tony Negline said the guidance may soon require further review depending on the outcomes of the review.
“These sorts of documents are always a work in progress and if we get any changes from the Quality of Advice Review then it may be necessary to adjust this document,” said Mr Negline.
“We’ll have to wait and see when the next iteration occurs.”
Mr Negline said ideally guidance documents such as these should be reviewed on a more frequent basis with Info Sheets 205 and 206 previously released back in 2015.
“It had probably been a little too long before this latest SMSF advice guidance had been adjusted for a variety of reasons,” he said.
“ASIC has a very large remit and obviously can’t get to everything all of the time.”
This type of guidance, he said, should ideally be reviewed every two to five years depending on what regulatory changes or court cases have occurred.
“There is a need to update these documents as time goes by more frequently than what has been done to date,” he said.
With the Quality of Advice Report now before the Minister for Financial Services Stephen Jones, Mr Negline said the government will now need to decide how it intends to respond to the report and legislate any changes and what the start date will be.
“It may be a while before the Quality of Advice recommendations are actively dealt with but that could be one reason why this ASIC guidance will need adjusting.”