Trustee Letter:«Fund_Name»
«Trustee_Letter_Day»«Trustee_Letter_Month»«Trustee_Letter_Year»
PRIVATE & CONFIDENTIAL
«Trustee__Director_1_First_Name»«Trustee__Director_1_Surname»
«Fund_Name»
«SMSF_Address__Line_1»
«SMSF_Suburb»«SMSF_State»«SMSF_Postcode»
Sent via email:email address
To theTrustees of the «Fund_Name»
Trustee Letter
«Fund_Name»
Year ended 30 June 2013
We have completed our preliminary audit of the above named superannuation fund for the year ended 30 June 2013. As outlined in the terms of our engagement, we remind you that our audit procedures have been designed to allow us to form an opinion on the financial statements as a whole, and therefore may not necessarily detect all financial report misstatements, non-compliance with legislative requirements, or weaknesses in internal control.
However, as per our engagement letter, we draw to your attention the following items arising from our audit that we believe to be significant to the operations and oversight of the superannuation fund. In particular, we draw to your attention the following issues:
Issue 1 Lack of internal controls over the fund’s bank account
We note that any one trustee is able to make payments from the fund bank account without requiring the approval of other trustee(s). This increases the risk that the fund may lend or provide financial assistance to members of the fund, and also the risk that the fund may gain illegal early access to member’s balances, which for the 2014 financial year could see the ATO impose significant administrative penalties. We recommend the trustees consider the implementation of a control which would require two signatories to make any payment.
Issue 2: Legislative changes effective 1 July 2014 to carry significant penalties
Whilst we have not identified any contravention in the course of auditing the fund for the 2013 financial year, we draw to your attention recently passed legislation that provides the ATO with the ability to issue significant administrative penalties of up to $10,200 for some of the most commonly contravened sections of the SIS Act and Regulations. These include sections 65 lending to members or relatives, 67 borrowing, 84 in-house assets, plus a range of other contraventions. We bring this to your attention for information purposes only.
Issue 3: Risks associated with individual trustees
With regard to the ATO’s power to issue the penalties referred in issue 2 above, we draw to your attention the fact that this penalty, if issued, will apply personally to each trustee of the fund. This will be required to be paid by the trustee, not the fund. We also inform you that as the fund has [insert number] individual trustees, this penalty would be [twice, three times etc] what it would be if the fund had a corporate trustee as it is each trustee that will be subject to the penalty.
Issue 4: [Insert issue 4]
Insert issue 4.
We kindly request you sign and return this letter to us via email at«Auditor_Email».
We would like to thank you for your assistance in relation to our audit. Should you have any questions relating to our audit, or the above items, please do not hesitate to contact us to discuss.
Yours sincerely,
«Audit_Firm_Name»
«Auditor_First_Name»«Auditor_Surname»
«Auditor_Position_ie_Director»
Page 1 of 2