The start of the SMSF audit season can also be the time of year that people consider whether they want to change their audit provider — generally from the beginning of the new financial year to after the end of August.
There can be various reasons why an SMSF service provider such as an accountant may consider changing auditors, and the reasons for doing so do not always stem from disagreement or some sort of dissatisfaction with an existing auditor’s services.
Sharif Eldebs, the principal of audit service provider Assured Super in Melbourne, says he has one client in regional NSW, for example, who upgraded her systems to cloud-based processes. The incumbent auditor’s way of doing things simply did not align with her new systems, and would have required her to gather and forward all documentation rather than being able to assign the auditor access to a client’s fund’s data files and documents online. Changing auditors in this case, and indeed in many other cases, was more a matter of streamlining processes. Sharif says this result can be an unforeseen trap when accountants upgrade systems.
But he says there are of course many instances of people wanting to change because of disagreements between an accountant and an auditor. “There are lots of areas where an auditor can fall short of expectations,” says Sharif. “Turnaround time can be a factor for example, and I’ve also found that sometimes the type of queries that come back from the auditor can simply rub the other party the wrong way. There are also times when an auditor simply will not be responsive, and of course pricing can come into the mix.”
The lodgement or otherwise of an audit contravention report (ACR) is also a potential hotbed for disputes between an auditor and accountants who manage SMSFs. “These disagreements tend to be over whether the ACR is necessary or not,” Sharif says.
He has found, however, that a collaborative approach can work well. “The rules do not require an auditor to alert a fund or its accountant if an ACR is intended to be lodged. At Assured Super we tend to do this anyway, out of courtesy but also because you will frequently find, because the accountant will naturally know a lot more about the client than the auditor does, that any anomaly might be able to be cleared up which may result in no ACR being lodged, because no breach has occurred.”
As far as tips to look out for when considering changing auditor, Sharif says looking for an experienced practitioner is always fruitful. “Another important element is turnaround times. Anything around one week is good, but also consider the turnaround times for having queries answered.”
Cost will naturally be a consideration, and while the ATO estimates that this should be around $650, Sharif considers an efficient auditor should still be able to average about $400 to $500. An important factor to not lose sight of, he says, is the ease with which data can be transferred and access to files and documents, as touched on above.
Tax & Super Australia offers an SMSF auditing option for members.
See here for details.
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