New reporting regime may sound the death knell for spreadsheets

“If people still consider SMSF administration a manual process, they’re going to get caught out,” he told SMSF Adviser ahead of his panel session at SMSF Adviser Technical Strategy Day tomorrow.

“At the moment they can get away with providing advice on commutation strategies or pension commencements once a year and back date documentation to solve their clients’ problems. But as we move towards quarterly reporting, they won’t be able to do it once a year. It’s going to have to be done in real time.”

As such, it will be critical for accountants and advisers to switch to dedicated SMSF administration software, and use data feeds across all SMSF platforms to process their clients’ funds on a regular basis, Mr Goldsmith said.

“Some clients still don’t have data feeds,” he said.

“In some cases, it’s hard to get data feeds, especially from credit unions and building societies. If it were me, I’d be looking at that as an opportunity to move to a bank that allows the client to get data feeds.”

Activating data feeds would deliver information to the SMSF administration software in real time and allow accountants to view the transactions on a daily basis, Mr Goldsmith highlighted.

Accountants can then monitor the occurrence of TBAR events and address it accordingly on an ongoing basis.

“By having that data come in, the administrator can see what’s happening in the fund on a daily basis. But does that mean accountants and administrators have to process the funds on a daily basis? No, but it allows them to monitor it and communicate with clients about what needs to be done on a regular basis.”

At the SMSF Adviser Technical Strategy Day in Sydney last week, Mr Goldsmith said the SMSF sector could reach large-scale professionalism through automation (such as data feeds and zero-touch components to the software), especially with the quarterly reporting schedule now in place.

He told SMSF Adviser today that moving into regular reporting would bring the SMSF industry in line with small-to-medium enterprises (SME), which underwent a similar transition period when the GST was introduced in 2000.

“Regular reporting has been around for a long time for SMEs. The SMSF industry is having its moment of change. It’s their turn to catch up,” Mr Goldsmith said.

As clients transition to quarterly reporting, it is important for advisers to stay abreast of the latest developments by registering for compliance and technical updates from the ATO, Mr Goldsmith suggested.

This would then allow advisers to educate their clients on the changes and guide them through the reporting processes.

“Advisers must also ensure that they have enough time prior to the event to implement pension strategies,” Mr Goldsmith flagged.

His comments came during the ongoing SMSF Adviser Technical Strategy Day 2023, for which Class is providing support as a platinum partner.

Mr Goldsmith said Class is “proud” to partner with the conference this year, as it is eager to support SMSF specialists.

“The level of knowledge that gets passed on at these events is great for the industry,” he said.

“It's also a great networking opportunity. I’ve enjoyed catching up with some of our amazing existing clients while meeting potential new clients as well in Sydney and Brisbane. I look forward to doing the same in Melbourne.”

David Goldsmith will participate in a panel discussion about the shift to quarterly transfer balance cap reporting and how advisers, accountants, and clients could prepare for this new regime at the SMSF Adviser Technical Strategy Day 2023.

It will be held on Wednesday 25 October at Grand Hyatt, Melbourne.

For more information about the event, including agenda and speakers, click here.