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Inside track: Superannuation, Funds Management & Financial Services

12 March 2019

#Superannuation, Funds Management & Financial Services

Inside track: Superannuation, Funds Management & Financial Services

In the media

ASIC acts against SMSF auditor misconduct
ASIC has acted to disqualify, suspend or add conditions to the registration of a number of auditors of self-managed superannuation funds (SMSFs). The actions arose following ASIC concerns about audit quality, independence issues, and failures to meet the fit and proper person criteria or other matters (08 March 2019).  More... 

Planner’s actions no excuse for super fund member’s insurance lapse
The Superannuation Complaints Tribunal has held that a superannuation fund member has remained responsible for the documentation on behalf of a client did not absolve the client of responsibility when he lost insurance cover, according to a determination by the Superannuation Complaints Tribunal (SCT) (07 March 2019).  More... 

AFCA submission to the Senate Inquiry into the resolution of disputes with financial service providers within the justice system
AFCA made a submission to the Senate Inquiry into the resolution of disputes with financial service providers within the justice system (07 March 2019).  More... 

Government flags key super amendments
The Federal Government has flagged key legislative changes around the taxation treatment of market-linked pensions around post-retirement products (05 March 2019).  More... 

Government continues to improve superannuation
The Government has released for consultation exposure draft legislation and regulations for six measures that address important issues affecting retirees announced in October last year (04 March 2019).  More... 

Taking action on the Banking, Superannuation & Financial Services Royal Commission – Recommendation 4.8: Removal of claims handling exemption
The Coalition Government has released a consultation paper on removing the exemption of insurance claims handling from the definition of ‘financial service’ under the Corporations Act (01 March 2019).  More... 

Accusation of CIPR ‘cargo cult’
Industry funds group, the Australian Institute of Superannuation Trustees has accused Treasury of fostering a cargo cult capable of forcing superannuation fund trustees not to act in the best interests of members, according to the Australian Institute of Superannuation Trustees (AIST) (26 February 2019).  More...   

Govt reinforces intention on MySuper advice fees
The Federal Government has reinforced its intention to prohibit the deduction of advice fees from MySuper accounts (26 February 2019).  More...  

ASX Corporate Governance Principles welcomed
The Financial Services Council (FSC) has welcomed the release of the fourth edition of the ASX Corporate Governance Principles and Recommendations, the new edition reflected Australia’s growing focus on strong culture, values and accountability in business (26 February 2019).  More... 

Fraud is everyone’s business
By its very nature, fraud involves deceptive conduct. Those who successfully exploit their privileged positions are often plausible, charming and highly adept at concealing their wrong-doing. This means that, despite AFSA’s best monitoring and intelligence gathering activities, fraud is not easy to uncover early without the assistance of others (26 February 2019).  More...  

AFCA welcomes recommendations from senate inquiry into credit and hardship
AFCA has welcomed recommendations from the Senate Inquiry into credit and financial services targeted at Australians at risk of financial hardship (25 February 2019).  More... 

APRA welcomes IMF report on Australian financial system
APRA welcomes the IMF’s Financial Sector Assessment Program (FSAP) report on Australia, which concluded that the Australian financial system has been further strengthened since the IMF’s previous assessment in 2012. The 2018 FSAP underscores the strength and resilience of the Australian financial system (22 February 2019).  More... 

In practice and courts 

FPA launches Return to Learn online education hub to help financial planners navigate FASEA standards
The Financial Planning Association of Australia (FPA) has launched Return to Learn, an online education portal designed to cut through misinformation and confusion about FASEA’s higher education requirements. FPA members and licensees can adopt the FPA CPD policy as their own by 31 March 2019 (07 March 2019).  More... 

Treasury consultation: Minor superannuation tax reform technical amendments and amendments to running balance accounts
The consultation exposure draft legislation and regulations covers six measures that address important issues affecting retirees announced in October last year. The legislation also includes amendments that permit the Commissioner of Taxation to account for additional tax debts in running balance accounts. The Government invites stakeholder feedback on the exposure draft legislation and regulations. The Consultation concludes on March 27 (04 March 2019).  More... 

Treasury consultation: Removal of claims handling exemption
The Coalition Government has released a consultation paper on removing the exemption of insurance claims handling from the definition of ‘financial service’ under the Corporations Act. Through this consultation process, the Government will identify the most appropriate way to implement Commission Hayne’s recommendation.Submissions close on 29 March 2019. The consultation paper is available here (01 March 2019). 

Fatal-flaw review draft: Proposed Standard AASB 2019-X Amendments to Australian Accounting Standards – References to the Conceptual Framework
Consequential amendments to support the AASB issuing the Conceptual Framework for Financial Reporting are set out in the proposed Standard AASB 2019-X. Comments to the AASB on any fatal flaw with the consequential amendments are due by 22 March 2019.  More.... 

Credit and hardship: Report of the Senate inquiry into credit and financial products targeted at Australians at risk of financial hardship
Senate Economics References Committee, Parliament of Australia - The intractable maths of low income earners' family budgets pushes them towards the marginal credit products such as payday loans, consumer leases and debt management firms. This report argues that government can and should improve the terms under which these products are offered. Report released on 22 February 2019.  More... 

ISA super report
Industry Super Australia and the Australian Economy, published 08 March 2019.  More... 

ASFA submissions
01 March 2019 - Submission to the Treasury - Protecting your Super package regulations and explanatory materials consultation paper.  More...  

FSC submissions
06 March 2019 - FSC Submission - Protecting Your Superannuation Package Draft Regulations

Cases

Wainwright and Commissioner of Taxation (Taxation) [2019] AATA 333
TAXATION – Self managed superannuation fund – superannuation funds accessed before conditions of release met – superannuation funds used to meet personal expenses – benefits received not included in income tax return – whether benefits to be assessed in the year that they were received – administrative penalty and shortfall interest charges – whether Commissioner should have exercised his discretion to not include benefits in assessable income – unreasonable for the Commissioner to include a benefit in the Applicant’s assessable income – decision under review affirmed – decision under review set aside and substituted. 

The Estate of Babich v South Australian Superannuation Board [2019] SADC 25
SUPERANNUATION - REVIEW OF DECISIONS
SUPERANNUATION - PUBLIC SERVICE FUNDS - PRESERVATION OF SUPERANNUATION RIGHTS UPON CEASING TO BE ELIGIBLE EMPLOYEE
Former public servant, since deceased, resigned from her job but did not roll over her public-sector superannuation fund balance within the statutory time limit – the death and total and permanent incapacity insurance policy attached to her fund membership thereby lapsed. Her application to the South Australian Superannuation Board for an extension of time was refused and subsequent appeal dismissed. 

Legislation

Commonwealth

Regulations

ASIC Corporations (Amendment) Instrument 2019/45
04/03/2019 - This instrument amends ASIC Corporations (Division 4 Financial Products) Instrument 2015/1030 to notionally modify regulation 7.11.08 of the Corporations Regulations 2001 so that interests in registered schemes that are quoted on the financial market operated by Chi-X Australia Pty Ltd are Division 3 securities and Division 4 financial products for the purposes of Part 7.11 of the Corporations Act 2001.

Superannuation (prudential standard) determination No. 1 of 2019
28/02/2019 – No longer in force.

Australian Securities and Investments Commission (Investigation into Grandfathered Conflicted Remuneration for Financial Advice) Direction 2019
27/02/2019 - This instrument directs ASIC to investigate the extent to which persons who are giving or accepting grandfathered conflicted remuneration in relation to financial advice are changing their arrangements to end the payment of grandfathered conflicted remuneration.

Superannuation (CSS) (Eligible Employees – Exclusion) Amendment Declaration 2019 (No. 1)
25/02/2019 - This instrument amends the Superannuation (CSS) (Eligible Employees – Exclusion) Declaration 2003 to specify the circumstances in which Australian Securities and Investments Commission (ASIC) staff who continue to be members of the Commonwealth Superannuation Scheme (CSS) upon transferring from Commonwealth employment to direct employment by ASIC on 1 July 2019 cease CSS membership.

Superannuation (PSSAP) Membership Eligibility (Inclusion) Amendment Declaration 2019 (No. 1) F2019L00192
25/02/2019 - This instrument amends the Superannuation (PSSAP) Membership Eligibility (Inclusion) Declaration 2005 to continue the PSSAP membership eligibility of certain employees of the Australian Securities and Investments Commission from 1 July 2019. 

Superannuation (PSS) Membership Inclusion Amendment Declaration 2019 (No. 1)
25/02/2019 - This instrument amends the Superannuation (PSS) Membership Inclusion Declaration 2006 to continue the Public Sector Superannuation Scheme contributory membership of certain employees of the Australian Securities and Investments Commission. 

Superannuation (CSS) (Eligible Employees – Inclusion) Amendment Declaration 2019 (No. 1)
25/02/2019 - This instrument amends the Superannuation (CSS) (Eligible Employees – Inclusion) Declaration 2003 to continue the Commonwealth Superannuation Scheme membership of certain employees of the Australian Securities and Investments Commission from 1 July 2019. 

Contacts:
Melbourne
Chris Lovell, Chairman
T: +61 3 9321 9832
E: chris.lovell@holdingredlich.com

Paul Faure, Partner
T: 61 3 9321 9904
E: paul.faure@holdingredlich.com

Bill Glover, Partner 
T: 61 3 9321 9844
E: bill.glover@holdingredlich.com

Brisbane
Kylie Wilson, Partner
T: 61 7 3135 0514
E: kylie.wilson@holdingredlich.com

Disclaimer
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this newsletter is accurate at the date it is received or that it will continue to be accurate in the future. 

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