“It's worth highlighting that there are two things that the ATO will be looking at ­­– can we prove ownership of the asset? If we can't, that is potentially a Part A qualification,” he said.

“Separately from that, are the assets of the fund being held separate from the assets that the trustees hold in their personal name? If not, that is potentially a Part B qualification.”

He added that auditors will most likely now be asking for more information to prove ownership of assets and additionally to prove that the assets are being kept separate.

“When we have a Part B qualification that potentially flows through to an auditor contravention report,” he said.

“The ATO believes that not only do we have law in the SIS Act and the SIS regulations that the asset must be kept separate, but it also feels that this is imperative to protect the fund assets. For example, if you've got assets in your own name, you're running a business, and the business goes belly up, how do you prove that those assets belong to the super fund and not the business and could not be available to the creditors?”

Cullen said it is good practice in order to meet these ownership and separation regulations that wherever possible assets should be held in the name of all trustees of the fund.

“If you've got, for example, individual trustees, the expectation is that the assets of the fund should be held in the name of all four individual trustees as trustee for the super fund,” he said.

“When we're dealing with individual trustees, you're not always going to be able to record all of the names of all the trustees, particularly where it is an asset like a shareholding account. There may be a limitation on the number of characters that can be used. That might mean you can only hold the asset in the name of two of the individual trustees, for example.”

However, he said the ATO has stated that as long as you are holding the asset as trustee for the fund, that in itself doesn't necessarily create a contravention or a breach of regulation 409A, which deals with with the separation of assets.

“Sometimes you're not going to be able to hold assets in the name of the trustee or as trustee for the fund, and so the ATO also said a lack of as trustee in itself, doesn't necessarily create a contravention of the regulations,” he said.

“However, you do need to look at what other paperwork is in place. There is a declaration of trust or an acknowledgement of trust. They are legal documents and are separate and different documents. You would attend to each document depending on the circumstance.

“Where the super fund has not taken ownership of the asset, yet it's been acquired in a name other than as trustee for the fund, to prove that ownership and separation, you get the declaration of trust, whereas, if the super fund, has already acquired the asset, and it's the naming convention that isn't adhered to when there's potential concerns, at that stage you would then get an acknowledgement of trust.”