The Morrison government is looking to complement the Your Future, Your Super reforms with new financial reporting requirements for funds.
With the aim to up transparency, accountability and regulatory oversight, the government is taking steps to enact more reforms in the super sector, which, if passed, would require funds to lodge audited financial reports with ASIC twice a year.
As per draft legislation, copies of each registered super fund’s financial report, a director’s report and auditor’s report will have to be provided to members and the public via ASIC.
Federal Minister for Superannuation, Financial Services and the Digital Economy Jane Hume said that while super funds are required to provide some information and data to the Australian Prudential Regulation Authority (APRA), the current requirements do not include financial reports that are in line with Australian Accounting Standards, nor are they available for public inspection.
While their combined value is comparable to that of the companies listed on the Australian Stock Exchange, Senator Hume said that Australia’s superannuation funds are subject to significantly looser obligations when it comes to financial reporting.
“$1 in every $10 Australians earn is compulsorily directed into superannuation. The Morrison government continues to reform the sector to be more transparent, efficient and fit for purpose as Australians expect and deserve,” she said.
The reform will also require funds to keep financial and accounting records for seven years, rather than the current five years, from July 2022.
Senator Hume framed the reforms as a complement to the recently passed Your Future, Your Super legislation. This bundle of reforms introduced a number of new requirements for the Australian superannuation sector, such as an annual performance test that aims to make it clearer to consumers which funds are underperforming.
“These changes are another way the Morrison government is improving the accountability and transparency of superannuation funds,” Senator Hume said.
The government will be taking stakeholder feedback on the reform until 8 September.
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