Currently that is annually.
However, the Federal Government announced in 2018 that they are considering changing this requirement to a three year cycle, for complying funds. If this change takes place there are a lot of issues to consider You might want to read the submission to the Government from the IPA (Institute of Public Accountants) on this here .
Issues include: Trustees will still have every year audited, but this would be completed once every three years. If trustees have made mistakes or inadvertently contravened regulations, the problem will only compound over three years. It is likely it will take more time and money to fix than if the issue had been picked up after a year.
Costs to rise for fewer SMSF audits? There will be savings for some funds, but for many there won’t be any cost reduction at all, and for some an increase in costs is likely, three-year audits may work for very simple funds, for instance those that only hold cash or managed funds but most funds are not that simple.
Audit as checks for good administration. Rather than view the audit as an impost, a better approach is to see it as a useful tool to help ensure the smooth running of the fund. The audit gives trustees an invaluable check they are administering the fund appropriately. SMSFs are complex, so instead of looking at the annual audit as a burden they should be looking at it as a tool that supports their role.
Serious consequences for SMSF auditors. This is going to create serious resourcing issues, which may increase costs for us and for our SMSF clients.
Who will decide audit timing? Which party will drive the timing of the audit – the trustee, the auditor or the Australian Taxation Office? This is not clear yet.
When more details are released we will be able to make a better assessment of any potential savings or costs. Until then, we can’t work out what the real impact will be.