Strategies for SMSF

We are looking into establishing a SMSF for ourselves. My husband is over 55 so he will be going straight to a allocated pension. So far I have found that I can obtain a trust deed from Cleardocs and have looked at the info from the ATO re compliance. The "establishing a strategy" is a little confusing though. I thought it was part of the trust deed but now I think that maybe it isn't. Is there some way I could access sample documents to get an idea of what is required? We have an idea of how we want to invest our money but think that it would be a good idea to leave it open because in the future we may think of other ways to invest the money.

I'd also like to know from anyone else with a SMSF, as the ATO says they are so tough on ensuring compliance with their laws, do they send information on any changes that may affect compliance or are we expected just to keep informed?

 

Hi Holley

Some of these might help :

http://www.dover.com.au/docs/FEESTCPD_2004_2005/SelfManagedSuperFundsCPDSpecialEdPart1.pdf (page 25)

http://www.reliancecapital.com.au/documents/warrants_accountant_guide.pdf (page 38)

10 TRAPS OF POOR SMSF ADMINISTRATION

Superannuation: Investing in property

You (and/or your accountant) are expected to keep up to date with the legislation - the obligations of the Trustee/s are pretty clearly spelled out

Once you have created the Investment Strategy the Trustees can change it if necessary - although it will probably be broad enough that you won't usually need to

Personally I'd pay for an experienced Accountant's advice in overseeing the whole thing - could be a pretty costly long term mistake if you miss something for the sake of a few hundred bucks now (but I'm risk averse ;-) )

Cheers
Carl

 

We're in the process of setting one up at the moment; is there any software available to keep a track of the Investments etc..or does anyone have an excel program (or ideas for what to put in one to efficiently track the investments?)

I'm an excel novice

 

BGL / CAS / Sales

Good software, you can print all your minutes, investment strategies etc from it, as well as keep track of all your investments and tax.
However I wouldnt bother getting it because you will have to take it to an accountant anyway. Best thing you can do is keep your super fund's bank statements each month, write details of any transactions so your accountant doesnt waste time (and thus money for you) trying to figure it out. Ensure that the ONLY thing going through the super fund's bank account is super fund transactions.
On top of this if you give your accountant copies of all your end of year holding statements, annual tax statements, and dividend statements (particularly where reinvestments are involved). There arent usually a heap of transactions occuring during the year for a super fund so a ring binder with some plastic sleeves would be more that sufficient!
if you have to pay $330 for software each year then accounting fees on top plus audit fees, you may as well just get the accountant to do it all.

 

Why

You get what you pay for.

If you have gone ahead a purchased a Cleardocs deed, I would be happy to review it for you and point out any shortcomings.

Seriously please be careful.

 

Yes!

Remember, most accountants are simple people. Make it easy for them!

 

Hi Holley,

There's some great info above but to summarise -

INVESTMENT STRATEGY

Yes you need one and this should be reviewed every 6-12months at least (or as requried to ensure every investment/allocation you make falls into the parrametres you've laid down in the Strategy itself).

This is a seperate document.

You also hit the nail on the head with thinking you may want to change the ways you invest money in the future. That's where 'ranges' such as 'aiming to invest between X% - Y% in Australian Shares' helps. Or A% - B% into Alternative assets. You then may add in a 'benchmark' as something you'll aim for between those ranges.

Mines about 7 pages, mostly template stuff but it's a living document that changes as requried.

TO KEEP INFORMED

Unfortunately there's no one-way-fix for this, it's a matter of combining a couple of methods. Using a SMSF specialisit accountant/auditor should take out most of the leg work.

SMSF News subscription service - fairly new ATO, free, publication on SMSF news. Probably close to what you're after.

https://lawcentral.com.au/SecureSignup/create.asp - a law site that sends up weekly emails about services they are offering, often in regards to changes in the Super arena.


Hope that helps.

P.S. Also a couple of good booklets for SMSF Trustees on the ATO's website.

 

Very good advice in deed.

If you can, try to utilise a SPAA accredited specialist adviser. You can locate one close to you by going to the SPAA website SMSF Professionals' Association and searching for a specialist.

Also, in regards to any kind of adviser, trust your instincts. If you reckon someone doesn't know what they are talking about, you are probably right - regardless of the qualifications after their name!

It is crucial to get quality advice at the start when setting up an SMSF. If you get that right, you are definitely heading in the right direction.

Good luck

 

Even Better - Get your Accountant to use Banklink to pull in your transactions automatically. It will save both you and your accountant a lot of time and hassle collating paper and followup phone calls if theres any missing statements! Banklink pull data from the majority of Banks, Financial Institutions as well as credit unions and Rural suppliers of data. It will also interface with Super and Wealth tools such as BGL. Managing information dosnt need to be done manually these days!

 

New SMSF Solution

You should have a look at the new SMSF software solution Class Super.

It is completely online and brings in all your bank data, share data, and platform information (if you have an adviser using one), and gives you up to date 24/7 web access to all your smsf details, including valuations, assets and liabilities, profit and loss, and members balances. The reporting is amazing - very easy to read and fully comprehensive.

Our accountant started using this system some 6 months ago and we finally now have a complete up to date picture of all our SMSF affairs so we can make informed decisions and know where our fund stands at any point.

It is definitely worth looking at.

I am not sure if you can get access to the system as a direct client, and you may have to ask your accountant if they can run your fund on it.

 

My accountant and I trialled Class Super and it did not do even half of what was promised and quite costly

We're sticking to Banklink and BGL Simple Super

My advice is to try a few different things and see what works best for you and your accountant.

 

Wiseone - I can only comment on our experience with Class Super which to date has been fantastic - our accountant previously used BGL.

We now have access to all our funds details whenever we want them which is important for us as we trade shares regularly.

In terms of cost - all I know is that our accountancy fees for this last year have almost halved as our accountant has stated it has taken him half the time to do the work.

I agree with your comments to look around and compare, we certainly did before we made this decision and we are very happy.

 

Clearly both software packages must be marketed by 10 year olds if they are resorting to fake posting and mud slinging on public forums. Sigh

 

SMSF Software is certainly improving. I have trialled BGL, superMate and Class Super lately and they are definitely better than the older or consumer focused products, though I was not that impressed with Class Super considering the price. It seems somewhat unfinished compared to the other products on the market.

Shop around and look for a product with a mature support offering and pedigree, it will pay for itself in the long run.

 

I have started using Class in the last 3 months after moving from an accounting practice that used BGL for over 150 funds.

I somewhat agree with some of the previous comments, Class is more expensive and to a certain degree it is still being developed and improved.

The development of Class is a lot more proactive and things seem to happen faster compared to other software providers that I have dealt with previously. Even in the relatively short time I have been using the software, it has improved noticeably.

The ever increasing number of direct data feeds they are incorporating is great and will eventually remove the need to use intermediary systems such as BankLink.

For many of our clients, we have been able to virtually eliminate the need for them to keep their own independent records (such as MYOB / QuickBooks files / spreadsheets / shoeboxes).

From my experience, once clients are set up in the Class software and the feeds are coming through, the processing time is hugely reduced. I am fully aware of the ability to combine BankLink and BGL to get a similar effect - and in some cases the time taken (and the cost to the client) will be similar.

In terms of performance, we have 90% of our clients 2010 SMSF returns completed (end of Feb 2011). I know other firms out their would struggle to have 90% completed by May 2011 (SMSFs generally lodge by the middle of May) - so there are obviously efficiency gains available.

The online reporting (which we update at least monthly) for our clients is superb, and is also a great feature for the clients accountant and financial planner to utilise when it comes to undertaking planning etc.

Because Class is a web based platform, it provides a great deal of flexibility in terms of how we run our business - most of the software we use is web based - I can virtually run everything from my laptop if I wanted which I personally love.

However the accounts are simply a means to and end - they should been seen as a tool used to enable SMSF trustees and their advisers to make decisions and provide advice that ultimately grow their wealth.

In summary, Class is not for every accountant out their with a handful of SMSFs, however in my business it is the perfect tool which will enable us to provide better and more cost effective advice to our clients and ultimately provide scalability and growth.

Apologies for moving this thread further off topic, but I thought my experience would be useful as I am in the position to comment on BGL as both a SMSF trustee and accountant, and I have also used Class extensively.

I hope that everyone with an interest in this area can find a solution that suits them.

SM

 

My wife and I are also looking at strating up a SMSF using the eSuper platfrom. This appears to be a low cost option but we are using our planner to assist in settingup and for our ongoing reviews, etc. I am currently waiting on formal documents.

Does anyone have a comment good/bad on this provider.

 

Do you mean ESuperfund?

If so, then my only comment is that they deliver what they promise which is a low cost solution for those who only want to to have listed shares and cash (maybe term deposits also???) within their SMSF.

Anything outside that will cost you more - whether it is through them or through another administrator.

Hopefully your adviser can fill the gaps as I don't believe esuperfund is an advice based service (and they do not try to be).

Hope this explains

Good luck

SM

 

Class Super

Class Super is the platform choice of Perpetual and Count Financial...

Pity Superman is the only person who knows much about the product.
I've been trying to find info about Class Financial Systems and their Class Super product, but haven't found anything substantial.

From the bits I've read, it looks like they're really trying to disrupt this segment of the market by offering a best-of-breed platform. That sounds quite exciting and I'm all for a smaller player coming in to show the big dogs they're being complacent.

I just wish I could find out a bit more about them...

 

Hi Carl,

I know all about Class.

The company I run, Superfund Partners, is one of only 5 'panel administrators' in Australia - which means Class refers people to us when the company (accountant or financial planner) doesn't have the scale to justify having a license for Class themselves.

I have previously used BGL extensively (with other 3rd party programs such as BankLink and Praemium), and I can honestly say that Class literally blasts BGL out of the water.

If you have any specific questions please let me know and I will answer them.

Thanks
Kris

 

Great feedback Kris; thanks mate!