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Inside track: Superannuation, Funds Management & Financial Services

31 May 2021

#Superannuation, Funds Management & Financial Services

Inside track: Superannuation, Funds Management & Financial Services

In the media

Super performance test needs trial run period

MEDIA – 27 May 2021 – the Government’s proposed superannuation performance test needs a two-year trial run as there are potential failures and risks of unintended consequences in the outworking of the test, according to a super body ASFA.  More...

Hayne failed and APRA failed on industry funds
MEDIA – 27 May 2021 – a Parliamentary Committee has found that the Hayne Royal Commission failed to adequately scrutinise industry superannuation fund structures and the Australian Prudential Regulation Authority has also fallen short, according to a Liberal member of that committee.  More...

First Australians, like all Australians, should have access to jobs with superannuation on every dollar
AIST – 26 May 2021 – for National Reconciliation Week, AIST is calling for jobs through the Federal Government’s Community Development Program (CDP) to be replaced with jobs that pay superannuation. We are concerned that the CDP denies participants workplace rights, including superannuation.  More...

Regulations fail to allay concerns that Your Future Your Super legislation will harm members
AIST – 26 May 2021 – the release of draft regulations relating to the Government’s Your Future Your Super legislation has done nothing to allay concerns that the legislation will cause more consumer harm than good and not deliver on its objectives.  More...

Former Sydney financial adviser sentenced to six years imprisonment
ASIC – 25 May 2021 – following an ASIC investigation, Mr Hopkins, a former financial adviser, was convicted of 15 dishonesty offences under the Corporations Act, committed when he was the sole director of QWL Pty Ltd. Mr Hopkins was a financial adviser entrusted by his clients to manage their self-managed superannuation accounts.  More...

Total superannuation assets hit a record high
TREASURY – 25 May 2021 – confirmation of total superannuation assets reaching an all‑time high means it is more important than ever to pass the Your Future, Your Super legislation currently before the House of Representatives.  More...

ASIC issues civil penalty action against Equiti FS
MEDIA – 20 May 2021 – the corporate regulator has commenced civil penalty proceedings against the company for breaching the prohibition against conflicted remuneration and failing to provide appropriate financial advice.  More...

Call to use Single Disciplinary Body to reduce, not increase costs
MEDIA – 20 May 2021 – the Government and Treasury should seek to avoid repeating the FASEA mistakes by using the establishment of a Single Disciplinary Body to reduce regulatory costs.  More...

More needs to be done to bridge COVID super gap and improve retirement outcomes for women and low income earners
AIST – 18 May 2021 – the legacy of the COVID early release super scheme on the retirement outcomes for millions of Australians will last a lifetime without policy measures to help bridge the savings gap, AIST CEO Eva Scheerlinck warned.  More...

Professional registration should be at the heart of new disciplinary model
FPA – 19 May 2021 – the FPA welcomes the Government’s proposal to establish a new disciplinary function for financial planners but is calling for further refinement to improve the model, including the creation of a true professional registration for financial planners.  More...

AFCA announces John Pollaers OAM as next Independent Chair
AFCA – 17 May 2021 – the Australian Financial Complaints Authority’s (AFCA) Board of Directors announced the appointment of Professor John Pollaers OAM as its next Independent Chair.  More...

In practice and courts

ATO Alerts
27 May 2021 Reminder: New accounting standard AASB 2020-2 applies from 1 July 2021
Reminder, the new accounting standard released by the Australian Accounting Standards Board applies from 1 July 2021 and may change how you prepare SMSF's financial statements.

Treasury Consultations – Reducing red tape for superannuation funds – ECPI measures
The draft legislation provides choice for superannuation fund trustees to use their preferred method of calculating ECPI where the fund is fully in the retirement phase for part of the income year but not for the entire income year.
The draft legislation will also remove a redundant requirement for superannuation funds to obtain an actuarial certificate when calculating ECPI. The exposure draft legislation and supporting materials are available on the Treasury website. View the submission guidelines for further information. Consultation will close on 18 June 2021.

Latest news on tax and superannuation law and policy: Budget 2021–22
The Government handed down the 2021–22 Budget on 11 May 2021, with several changes to tax and superannuation laws (see budget.gov.au).
The measures are listed here with proposed commencement dates.  More...

ASIC Updates

07/05/2021 ASIC Corporations (Amendment) Instrument 2021/381
Amends the ASIC Corporations (Auditor Independence) Instrument 2021/75 and ASIC Corporations (Parent Entity Financial Statements) Instrument 2021/195 to change the repeal dates from April 2026 to April 2024

06/05/2021 INFO 253 Claims handling and settling: How to comply with your AFS licence obligations (PDF 386 KB – reissued)
Updated to reflect the Financial Sector Reform (Hayne Royal Commission Response) (Claimant Intermediaries) Regulations 2021 (made on 15 April 2021) which exclude certain people from being ‘claimant intermediaries.

ASIC Corporations (COVID-19–Advice-related Relief) Instrument 2021/268
Extends until 15 October 2021 the relief measure that allows financial advisers to provide a record of advice rather than a statement of advice to existing clients requiring financial advice due to the impact of the COVID-19 pandemic: See 21-072MR and FAQs.

ASIC Consultations: CP 340 Breach reporting and related obligations
Comments close 3 June 2021.
This consultation paper sets out our proposals for providing guidance to Australian financial services (AFS) licensees and Australian credit licensees (credit licensees) on the breach reporting obligation that applies from 1 October 2021. The obligations require these licensees to notify, investigate and remediate breaches of the law in certain circumstances.  More...

ASIC Corporations, Superannuation and Credit (Amendment) Instrument 2020/99
Amends the ASIC Corporations and Credit (Internal Dispute Resolution–Transitional) Instrument 2019/965 to preserve ASIC's existing internal dispute resolution policy in relation to complaints received by financial firms before 5 October 2021.

Consultation exposure draft regulations underpinning Treasury Laws Amendment (Your Future, Your Super) Bill 2021
Under the Your Future, Your Super reforms, the Morrison Government is taking the next step in modernising and improving the superannuation system. The Your Future, Your Super package is scheduled to commence on 1 July 2021. Consultation closed on 25 May 2021. Further information is available at the Treasury website.  More...

APRA releases superannuation statistics for March 2021
The Australian Prudential Regulation Authority (APRA) has released its Quarterly Superannuation Performance publication and the Quarterly MySuper Statistics report for the March 2021 quarter (25 May 2021).  More...

APRA publishes additional FAQs and worked examples on the Superannuation Data Transformation Phase 1 reporting standards
To provide further guidance on meeting the Reporting Standards for Phase 1 of the Superannuation Data Transformation. One FAQ has been updated to clarify reporting under Reporting Standard SRS 332.0 - Expenses. The FAQs are available on the APRA website at Frequently Asked Questions - Superannuation Data Transformation (21 May 2021).

APRA consultation on guidance in support of prudential standard on remuneration
The draft Prudential Practice Guide CPG 511 Remuneration sets out principles and examples of better practice to assist banks, insurers and superannuation licensees comply with prudential standard CPS 511 Remuneration, which will be finalised later this year. The closing date for submissions on the draft CPG 511 is 23 July 2021.
Copies of the draft CPG 511 and a consultation letter are available on APRA’s website at: Consultation on remuneration requirements for all APRA-regulated entities.

APRA draft Prudential Practice Guide CPG 229 Climate Change Financial Risks (CPG 229)
The guide is designed to assist APRA-regulated entities in managing climate-related risks and opportunities as part of their existing risk management and governance frameworks. APRA is seeking stakeholder feedback on the draft CPG 229 by 31 July 2021. The draft CPG 229 and supporting resource links are available on the APRA website at: Consultation on draft Prudential Practice Guide on Climate Change Financial Risks.

APRA draft taxonomy artefacts to assist superannuation entities prepare for APRA Connect
APRA has released the response paper and 10 final reporting standards for the first phase of its multi-year Superannuation Data Transformation. The Response Paper and finalised reporting standards are available at: Consultation on APRA's Superannuation Data Transformation. These new collections will be reported through APRA Connect. Final versions of these documents will be available before the external test environment is released to entities in June 2021. The draft artefacts include the data dictionary, validations, reporting taxonomy and XSD (to validate files). 

AIST Submissions
25 May 2021 AIST Submission to Treasury: Your Future Your Super Regulations and associated measures
AIST supports the objectives of the Your Future Your Super package to hold super funds to account for their performance, address the creation of unintended multiple accounts, empower members and increase transparency and accountability. AIST does not believe the legislation or regulations will deliver on these objectives.

Legislation

Commonwealth

Financial Regulator Assessment Authority (Consequential Amendments and Transitional Provisions) Bill 2021
26/05/2021 – introduced with the Financial Regulator Assessment Authority Bill 2021, the bill amends five Acts to make amendments consequential on the establishment of the Financial Regulator Assessment Authority.

Financial Regulator Assessment Authority Bill 2021
26/05/2021 – introduced with the Financial Regulator Assessment Authority (Consequential Amendments and Transitional Provisions) Bill 2021, the bill: Establishes the Financial Regulatory Assessment Authority to assess and report on the effectiveness and capability of the Australian Prudential Regulation Authority and the Australian Securities and Investments Commission; and prohibits the unauthorised use or disclosure of protected information provided to the Authority.

Treasury Laws Amendment (2021 Measures No. 4) Bill 2021
HR 26/05/2021 – amendments to product intervention regime – to provide that ASIC is not prohibited from making a product intervention order that has conditions relating to fees, charges or other consideration paid or payable as remuneration by a retail client or consumer to a person, including the provider (or their associates) of a financial product or a credit product.

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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