Reconciliations and values a mystery


Robert, an adviser, came to Super Plus in July 2010 with a long standing SMSF client who had an outstanding tax return for the 2009 year, and the 2010 year return was due on 31 October 2010. The 2008 year return had been lodged late, and the adviser was not confident that the previous administrator had correctly dealt with a new pension that had commenced in the 2008 year. He was also concerned that fund transactions such as contributions, rent and pension payments which occurred during the 2009 and 2010 years had not been monitored closely, and whether the correct minimum pension had been drawn during those years.

Super Plus Review

We reviewed the 2008 financial statements and member statements and found that a member had commenced a pension on 1 July 2007, however no pension documents had been prepared by the previous administrator to confirm the details of the pension. Also, contributions had been added to the pension account during the 2008 year.

We also found that the fund’s income tax account and GST account had not been reconciled as at 30 June 2008, GST instalments had been overpaid but not identified and advised to the ATO for refund, and that non superannuation fund tax payments had been credited to the tax account during the period since 30 June 2008.

During the 2009 and 2010 years there were a number of deposits to and withdrawals from the fund’s bank account that required clarification and reconciliation.

We were advised that the value of property held by the fund (and leased to a related party) had increased significantly since the commencement of the pension, however, no independent market value of the propertys or its rental had been sought by the trustees during that period. We also noted that there was no written lease agreement with the tenant.

Super Plus Actions

  1. The 2008 financial statements were amended so that contributions originally included in the pension account were allocated to a separate accumulation account for that member.
  2. Pension commencement documents and minutes were prepared by Super Plus, and signed by the trustees to confirm the pension terms and tax components.
  3. Trustee arranged with a independent registered valuer for market value reports for the property’s value and rental income. Using this information we were able to determine the value of the pension for the purposes of calculating the correct minimum pension for the 2010 and 2011 years, and whether rental received by the fund was in line with the “arm’s length, commercial ” rental value. We also requested that a commercial lease agreement be drawn up between the parties.
  4. Contributions and rental receipts for the 2009 and 2010 years were reconciled and confirmed with the trustees’ personal accountant. We checked that contribution regulations were not breached and contribution levels were within the members’ relevant caps.
  5. All share holdings were confirmed and outstanding dividends were identified and were followed up for payment to the fund. Non super fund dividends deposited to the fund’s bank account were identified and steps were taken to rectify this happening in the future.
  6. The fund’s income tax account and GST account were reconciled for the period to 30 June 2010, with the correct liabilities being calculated, and adjustments to tax and GST instalments being made where required. Non super fund payments to the super fund’s integrated client were transferred to the correct taxpayers’ accounts.


The fund’s outstanding tax return lodgments had been brought up-to-date, and the fund was compliant.

Since then the fund’s transactions have been processed on a regular basis and any concerns are raised and dealt with on a timely basis.

The trustees are relieved and happy that their fund is being monitored on a regular basis and Robert, the adviser, is able to advise the trustees knowing that fund is compliant and information relating to the fund is current.

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