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ASIC SMSF report welcomed

A number of key industry stakeholders have reacted positively to the findings of the Australian Securities and Investments Commission’s taskforce into SMSF advice released yesterday.

SMSF Professionals’ Association of Australia (SPAA) chief executive Andrea Slattery welcomed the taskforce finding that a majority of advice seen by the regulator in its review of investor files was ‘adequate’.

“The findings confirm there is good advice in the market, as even at the high-risk level most was actually quite good,” she told ifa.

Slattery said ASIC’s monitoring of the “remaining outliers” of poor advice will help to eradicated incomptetent players from the SMSF market.

“That’s why the work ASIC does is so important,” she said.

In a statement issued yesterday, Peter Burgess – who joined AMP’s SMSF unit as head of policy and technical from the SPAA earlier this month – concurred that the report indicated a healthy SMSF sector.

“This is an encouraging result for the industry, particularly when you consider ASIC’s sample is focused on the high-risk cases,” he said.

Burgess also welcomed ASIC’s recommendation in the report that advisers take pains to ensure that only suitable clients are placed into self-managed superannuation structures.

“Before considering opening an SMSF it’s important to get quality advice, as an SMSF is not necessarily right for everyone,” he said.

“AMP supports the views expressed by ASIC in the report that investors need access to good quality, tailored advice about SMSFs – AMP has already done a lot of work in this area and plans to do further work in the future.”

However, the finding that 28 per cent of advice in the sample was considered ‘poor’ “highlights the fact that SMSF trustees need to ensure they choose an adviser with SMSF specific skills and training,” Burgess said.

Similarly, business lawyer Peter Townsend said the ‘poor’ advice finding highlights the need for advisers to have skills beyond the investment space when dealing with SMSF clients.

“RG146 training does not cover SMSF law to the same degree as it covers portfolio management/asset classes,” he said.