ASIC has released two information sheets to improve the quality of advice provided by advisers on SMSF
The information sheets are intended to assist advisers comply with their conduct and disclosure obligations under the Corporations Act and outline what ASIC looks at when undertaking surveillance in this area. They specify the types of risks and costs that an adviser should consider, discuss and then disclose to clients when providing advice on establishing or switching to, an SMSF
The information sheets also deal with the cost-effectiveness of an SMSF
, making clear ASIC's view that an SMSF
with a starting balance of $200,000 or below is unlikely to be in the client’s best interests and that advice to establish one below that threshold is more likely to be scrutinised by ASIC.
“Setting up an SMSF
is a significant financial step for consumers and many factors can impact their decision. It is therefore important that consumers receive good quality advice that will assist them in making informed decisions about their retirement savings,” ASIC Deputy Chairman Peter Kell
“ASIC wants to ensure that only those investors for whom an SMSF
is suitable are advised to establish an SMSF
and that our expectations around the standards of advice are clear.”
According to Kell, SMSF
s will be a key priority for ASIC, as it continues to target inappropriate advice about SMSF
s in its surveillance work. The information sheets will provide compliance tips, which indicate the factors that ASIC is likely to look at more closely as part of its surveillance.