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Inside track: Superannuation, Funds Management & Financial Services

05 October 2021

#Superannuation, Funds Management & Financial Services

Inside track: Superannuation, Funds Management & Financial Services

In the media

More than one million super fund members in underperforming funds urged to take the time to understand their retirement savings options
AIST – 29 September 2021 – with more than one million super fund members in underperforming funds now having received notification from their fund, the Australian Institute of Superannuation Trustees (AIST) is urging members to take the time to understand their options.  More...

Better Advice Bill – Exposure Draft Regulations
TREASURY – 29 September 2021 – the Morrison Government has released for consultation exposure draft regulations and a draft legislative instrument underpinning the Financial Sector Reform (Hayne Royal Commission Response–Better Advice) Bill 2021 (the Better Advice Bill). The Better Advice Bill establishes a single disciplinary body and new registration system for financial advisers, including tax (financial) advisers.  More...

Release of Retirement Income Covenant Exposure Draft
TREASURY – 27 September 2021 – the Morrison Government has released exposure draft legislation that will introduce a Retirement Income Covenant to give retirees the confidence to spend their superannuation savings, while enabling choice and competition in the retirement phase of superannuation.  More...

Advisers’ code of ethics offers a wider opportunity
AFCA – 27 September 2021 – the Code of Ethics for financial advisers is not all about catching out bad players, or about trading profit for “doing good”, says Australian Financial Complaints Authority Deputy Chief Ombudsman June Smith.  More...

ASIC publishes guidance on hawking reforms
ASIC – 23 September 2021 – ASIC has published updated regulatory guidance on the prohibition of hawking financial products. ASIC’s updated regulatory guide reflects the reforms to the anti-hawking regime under the Financial Sector Reform (Hayne Royal Commission Response) Act 2020, which commence on 5 October 2021.  More...

ASIC to take ‘practical’ and ‘reasonable’ approach to disciplinary body
MEDIA – 22 September 2021 – the Australian Securities and Investments Commission (ASIC) expects to take a “practical and reasonable” approach to the single disciplinary body which is due to take effect on 1 January, 2022.  More...

In practice and courts

Consultation: Better Advice Bill – Exposure Draft Regulations
The Better Advice Bill establishes a single disciplinary body and new registration system for financial advisers, including tax (financial) advisers. The exposure draft regulations and legislative instrument will implement key elements to support the operation of the Better Advice Bill. The Exposure Draft Regulations and Legislative Instruments are available on the Treasury website. Submissions are invited by Friday 15 October 2021 and can be sent to SDBconsultation@treasury.gov.au.

ASIC updates
23/09/2021 RG 38 The hawking prohibition (reissued); REP 701 Response to submissions on CP 346 The hawking prohibition: Update to RG 38; ASIC Corporations (Amendment and Repeal) Instrument 2021/799.
Updated to reflect reforms to the anti-hawking regime under the Financial Sector Reform (Hayne Royal Commission Response) Act 2020, commencing 5 October 2021: See 21-257MR and 21-213MR.
22/09/2021 INFO 260 FAQs: Timeframe for passing the financial adviser exam.

ASIC consultation: Draft guidance for the hawking reform
'ASIC’s guidance gives additional clarity on how the changes may affect commercial practices, systems and processes. All interested stakeholders have until 17 August to provide feedback on CP 346. ASIC will publish its final guidance in September 2021, ahead of the revised hawking prohibition commencing on 5 October 2021.  More...

ASIC consultations: CP 340 Breach reporting and related obligations
This consultation paper set out our proposals for providing guidance to Australian financial services 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...

APRA Consultation: Proposed revisions to Prudential Standard SPS 530 Investment Governance (SPS 530)
SPS 530 aims to ensure registrable superannuation entity licensees meet their obligations to prudently select, manage and monitor investments. The updates focus on enhancements to stress testing, valuation and liquidity management practices. The consultation will run until 16 February 2022. A letter outlining the proposed revisions and a draft version are available on the APRA website at: Consultation on Prudential Standard SPS 530 Investment Governance in Superannuation (29 September 2021).

APRA publishes additional FAQs on the Superannuation Data Transformation Phase 1 reporting standards
The FAQs released provide an update on the staged implementation approach, including an extension to the timeframe for the initial submission of data due by 30 September 2021 to due by 28 October 2021. The new FAQs are available on the APRA website at: Frequently Asked Questions – Superannuation Data Transformation.(27 September 2021).

APRA publishes additional FAQs on the Superannuation Data Transformation Phase 1 reporting standards
APRA is releasing FAQs to clarify reporting issues raised by RSE licensees and to help them meet their reporting obligations. APRA has also made updates to the SRS 251.0 Insurance worked example. The FAQs and worked examples are available on the APRA website at: Frequently Asked Questions - Superannuation Data Transformation (23 September 2021).

APRA updated schedule of policy priorities for 2021
The APRA has released a letter providing an updated schedule of policy priorities for the remainder of 2021, focusing on key reforms to strengthen financial resilience. The letter outlining APRA’s updated policy priorities can be found on the APRA website at: APRA policy priorities: Interim update (24 September 2021).

APRA releases update on standard and guidance on insurance in superannuation
The APRA has published an update on its proposed revisions to Prudential Standard SPS 250 Insurance in Superannuation and Prudential Practice Guide SPG 250 Insurance in Superannuation, released for consultation in January 2021. The letter to industry is available on the APRA website at: Consultation on Prudential Standard SPS 250 Insurance in Superannuation (21 September 2021).

AFSA feedback on guidance resources
AFSA is seeking your feedback on proposals to improve the accessibility of our guidance resources for stakeholders including Inspector-General Practice Statements, Inspector-General Practice Directions, Official Receiver Practice Statements and Official Trustee Practice Statements. We have set up a consultation on AFSAsandpit and invite you to submit your feedback before 1 October 2021.

AFCA current matters
Sterling group investors (Updated September 2021).

Retirement Income Covenant Exposure Draft
The Retirement Income Covenant builds on the substantial reforms the Morrison Government has implemented to improve Australia’s retirement income system. The draft legislation and supporting materials are available on the Treasury website and stakeholders are encouraged to provide their feedback. Consultation will close on 15 October 2021. Subject to the passage of legislation, the covenant will take effect from 1 July 2022. View the Exposure Draft (27 September 2021).

Cases

Asteron Life & Superannuation Limited, in the matter of Asteron Life & Superannuation Limited (No 3) [2021] FCA 1148
INSURANCE – life insurance – scheme for transfer of life insurance business – application to Court for confirmation of scheme pursuant to s 193 of the Life Insurance Act 1995 (Cth) (Act) – principles applicable to confirmation of scheme of transfer
INSURANCE – application pursuant to s 191(5) of the Act to dispense with the requirement to comply with s 191(2)(c) – principles applicable to dispensation.

Halvorson & Anor v Birkenhead Super Pty Limited atf Birkenhead Superannuation Benefits Fund [2021] QCA 211
PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – ENDING PROCEEDINGS EARLY – SUMMARY DISPOSAL – SUMMARY JUDGMENT FOR PLAINTIFF OR APPLICANT – where summary judgment was given in favour of the plaintiff for the whole of its claim at first instance – whether the preconditions to the exercise of the discretion to deal with the matter summarily were present
Corporations Act 2001 Cth s 254K;,Uniform Civil Procedure Rules 1999 Qld r 292.

Legislation

Commonwealth

Regulations

ASIC Corporations, Credit and Superannuation (Amendment) Instrument 2021/753
29/09/2021 – this instrument amends the ASIC Corporations, Credit and Superannuation (Internal Dispute Resolution) Instrument 2020/98 to incorporate an updated version of Regulatory Guide 271 (RG 271) and removes enforceability from four paragraphs that overlapped with existing legislative requirements. It therefore amends ASIC Corporations, Credit and Superannuation (Internal Dispute Resolution) Instrument 2020/98 (IDR Instrument).

ASIC Corporations (Amendment and Repeal) Instrument 2021/799
22/09/2021 – this instrument provides consequential amendments to a number of existing Australian Securities and Investments Commission (ASIC) legislative instruments and class orders by updating statutory references to the prohibition on the hawking of financial products. The instrument also repeals two ASIC legislative instruments, ASIC Corporations (Securities and Managed Investment Scheme Hawking Relief) Instrument 2017/184 and ASIC Corporations (Life Risk Insurance and Consumer Credit Insurance) Instrument 2019/839), the function of which are made redundant by the new amendments made by the Financial Sector Reform (Hayne Royal Commission Response) Act 2020 and amendments made to the Corporations Regulations 2001.

Auditing Standard ASA 2021-4 Amendments to Australian Auditing Standard ASA 800 Special Considerations – Audits of Financial Reports Prepared in Accordance with Special Purpose Frameworks
20/09/2021 – this instrument amends the Australian Auditing Standard ASA 800 Special Considerations – Audits of Financial Reports Prepared in Accordance with Special Purpose Frameworks as a result of changes to the Australian Accounting Standards impacting the ability for certain for-profit entities to prepare Special Purpose Financial Statements.

Auditing Standard ASA 2021-2 Amendments to Australian Auditing Standard ASA 560 Subsequent Events
20/09/2021 – this instrument amends the Australian Auditing Standard ASA 560 Subsequent Events to clarify the timing of communications and possible actions the auditor may take when facts become known to the auditor after the financial report has been issued that, had it been known to the auditor at the date of the auditor’s report, may have caused the auditor to amend the auditor’s report.

Banking (prudential standard) determination No. 3 of 2021
20/09/2021 – this instrument determines Prudential Standard APS 111 Capital Adequacy: Measurement of Capital and revokes Banking (prudential standard) determination No. 4 of 2017 including Prudential Standard APS 111 Capital Adequacy: Measurement of Capital.

Auditing Standard ASA 101 Preamble to AUASB Standards
20/09/2021 – this Auditing Standard sets out how the Auditing and Assurance Standards Board (AUASB) Standards are to be understood, interpreted and applied. AUASB Standards are to be read and applied in conjunction with this Auditing Standard.

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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