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Financial Sector Legislation Amendment (Simplifying Regulation and Review) Bill 2007

Schedule 3 Accounts, reporting etc. obligations

   

Financial Institutions Supervisory Levies Collection Act 1998

1  Subparagraph 9(2)(a)(i)

Repeal the subparagraph, substitute:

                              (i)  is specified in a notice given by APRA to the Treasurer on or after the day on which an annual return that is a reporting document under section 13 of the Financial Sector (Collection of Data) Act 2001 and that relates to the previous financial year was received by APRA; and

Financial Sector (Collection of Data—Consequential and Transitional Provisions) Act 2001

2  Item 152 of Schedule 2

Repeal the item.

Income Tax Assessment Act 1936

3  Subsection 161(3) (including the note)

Omit “36A” (wherever occurring), substitute “35D”.

Superannuation Industry (Supervision) Act 1993

4  Section 4 (table item for Part 4)

Repeal the item, substitute:

4

accounts, audit and reporting obligations for superannuation entities

5  Section 4 (table item for Part 13)

Repeal the item.

6  Subparagraph 6(1)(a)(vii)

Omit “Parts 13”, substitute “Part 14”.

7  After subsection 29N(1)

Insert:

          (1A)  APRA may cancel the registration of a superannuation entity that has become a self-managed superannuation fund.

8  Part 4

Repeal the Part, substitute:

Part 4 Accounts, audit and reporting obligations for superannuation entities

   

35   Objects of Part

                   The objects of this Part are:

                     (a)  to set out rules about the accounts, statements and audits of superannuation entities; and

                     (b)  to require certain reports and returns relating to superannuation entities to be given to the Regulator.

35A   Accounting records (all superannuation entities)

             (1)  Each trustee of a superannuation entity must ensure that:

                     (a)  accounting records that correctly record and explain the transactions and financial position of the entity are kept; and

                     (b)  if the entity is a registrable superannuation entity—the accounts of the entity are kept in a way that enables the preparation of reporting documents referred to in section 13 of the Financial Sector (Collection of Data) Act 2001 ; and

                     (c)  if the entity is a self managed superannuation fund—the accounting records of the entity are kept in a way that enables the following to be prepared:

                              (i)  the accounts and statements of the entity referred to in section 35B;

                             (ii)  the returns of the entity referred to in section 35D; and

                     (d)  the accounting records of the entity are kept in a way that enables those accounts, statements and returns to be conveniently and properly audited in accordance with this Act.

             (2)  If accounting records of a superannuation entity are kept in accordance with subsection (1), each trustee of the superannuation entity must ensure that:

                     (a)  the records are retained for at least 5 years after the end of the year of income to which the transactions relate; and

                     (b)  the records are kept in Australia; and

                     (c)  the records are kept:

                              (i)  in writing in the English language; or

                             (ii)  in a form in which they are readily accessible and readily convertible into writing in the English language.

             (3)  A trustee commits an offence if the trustee contravenes subsection (1) or (2).

Penalty:  100 penalty units.

             (4)  A trustee commits an offence if the trustee contravenes subsection (1) or (2). This is an offence of strict liability.

Penalty:  50 penalty units.

Note:          For strict liability , see section 6.1 of the Criminal Code .

35B   Accounts and statements (self-managed superannuation funds only)

             (1)  Each trustee of a superannuation entity that is a self managed superannuation fund must, in respect of each year of income of the fund, ensure that the following accounts and statements are prepared in respect of the entity:

                     (a)  except where the regulations provide that this paragraph does not apply—a statement of financial position;

                     (b)  except where the regulations provide that this paragraph does not apply—an operating statement;

                     (c)  the accounts and statements specified in the regulations.

             (2)  The regulations may provide for or in relation to the preparation of accounts and statements covered by subsection (1). If the regulations do so, the accounts and statements covered by subsection (1) must be prepared in accordance with the regulations.

             (3)  The accounts and statements prepared in accordance with subsection (1) must be signed as follows:

                     (a)  if there is a single corporate trustee—by:

                              (i)  if there is only one director of the corporate trustee—that director; or

                             (ii)  otherwise—at least 2 directors of the corporate trustee; or

                     (b)  if there is a group of individual trustees—by at least 2 of those trustees.

             (4)  Each trustee must ensure that the accounts and statements prepared in accordance with subsection (1) are retained for a period of 5 years after the end of the year of income to which they relate.

             (5)  A person commits an offence if the person contravenes this section.

Penalty:  100 penalty units.

             (6)  A person commits an offence if the person contravenes this section. This is an offence of strict liability.

Penalty:  50 penalty units.

Note:          For strict liability , see section 6.1 of the Criminal Code .

35C   Audit of accounts and statements (all superannuation entities)

             (1)  For each year of income, each trustee of a superannuation entity must ensure that an approved auditor is appointed to give the trustee or trustees a report, in the approved form, of the operations of the entity, and the RSE licensee (if any) of the entity, for that year. The appointment must be made within whichever of the periods set out in the regulations applies to the entity.

             (2)  If an auditor requests, in writing, a trustee of a superannuation entity to give the auditor a document, each trustee of the entity must ensure that the document is given to the auditor within 14 days of the request being made. Only documents that are relevant to the preparation of the report may be requested.

             (3)  A trustee commits an offence if the trustee contravenes subsection (1) or (2).

Penalty:  Imprisonment for 2 years.

             (4)  A trustee commits an offence if the trustee contravenes subsection (1) or (2). This is an offence of strict liability.

Penalty:  50 penalty units.

Note:          For strict liability , see section 6.1 of the Criminal Code .

             (5)  Without limiting subsection (1), an approved form:

                     (a)  must, if it is approved for a registrable superannuation entity, either:

                              (i)  relate solely to the audit of financial statements given to APRA under the Financial Sector (Collection of Data) Act 2001 and prepared in respect of a year of income; or

                             (ii)  relate only to the audit of those statements and of any other accounts and statements, prepared in respect of a year of income, that are identified in the form; and

                     (b)  must, if it is approved for a superannuation entity that is a self managed superannuation fund—either:

                              (i)  relate solely to the audit of the accounts and statements referred to in subsection 35B(1) and prepared in respect of a year of income; or

                             (ii)  relate only to the audit of those accounts and statements and of any other accounts and statements, prepared in respect of a year of income, that are identified in the form; and

                     (c)  must include a statement by the auditor as to whether, in the auditor’s opinion, each trustee of the entity and the RSE licensee (if any) of the entity has, during the year of income, complied with the provisions of:

                              (i)  this Act and the regulations; and

                             (ii)  if the entity is a registrable superannuation entity—the Financial Sector (Collection of Data) Act 2001 , the Corporations Act 2001 and the regulations under that Act;

                            that are identified in the form; and

                     (d)  must, if it is approved for a registrable superannuation entity that is registered under Part 2B, include a statement by the auditor as to whether, in the opinion of the auditor, the RSE licensee of the entity:

                              (i)  has complied with each risk management plan for the entity that applied during that year; and

                             (ii)  has adequate systems to ensure future compliance with any risk management plan for the entity; and

                            (iii)  has complied with each risk management strategy that applied to the RSE licensee during that year in relation to risks arising from any activities, and proposed activities, as RSE licensee of the entity, and all other activities, or proposed activities, relevant to those activities; and

                            (iv)  has adequate systems to ensure future compliance with the risk management strategy for the RSE licensee in relation to future risks arising from any proposed future activities as RSE licensee of the entity, and all other proposed future activities relevant to those activities.

             (6)  The auditor must give the report to each trustee of the entity within the prescribed period after the end of the year of income.

             (7)  The auditor commits an offence if the auditor contravenes subsection (6).

Penalty:  Imprisonment for 6 months.

             (8)  The auditor commits an offence if the auditor contravenes subsection (6). This is an offence of strict liability.

Penalty:  50 penalty units.

Note:          For strict liability , see section 6.1 of the Criminal Code .

35D   Trustee to lodge annual returns (self-managed superannuation funds only)

Lodgment

             (1)  Each trustee of a superannuation entity that was a self managed superannuation fund at any time during a year of income must, within the reporting period, or within such longer period as the Commissioner of Taxation allows, ensure that the Commissioner of Taxation is given a return under this section.

Period for lodgment

             (2)  The reporting period is the period that begins at the end of the year of income and whose length is:

                     (a)  prescribed by the regulations for the purposes of this paragraph; or

                     (b)  if the length of the period is not prescribed—specified, by legislative instrument, by the Commissioner of Taxation.

Form of return

             (3)  The return must:

                     (a)  be in the approved form; and

                     (b)  contain the information required by the form in relation to the fund in respect of that year of income or in relation to another year of income, or both.

Note:          The approved form of return may require a trustee to set out the tax file number of the entity. See subsection 299U(2).

             (4)  A person commits an offence if the person contravenes this section.

Penalty:  50 penalty units.

             (5)  A person commits an offence if the person contravenes this section. This is an offence of strict liability.

Penalty:  25 penalty units.

Note:          For strict liability , see section 6.1 of the Criminal Code .

36   Trustee to give copy of audit report to APRA (registrable superannuation entities only)

Lodgment

             (1)  Each trustee of a registrable superannuation entity must, within the prescribed period after the year of income, ensure that APRA is given a copy of the report given to a trustee of the entity by an approved auditor under section 35C in relation to the entity, and any RSE licensee of the entity, in respect of that year of income, certified to be a true copy of the report by:

                     (a)  if the trustee is a body corporate—a responsible officer of the body corporate; or

                     (b)  if the trustee is a member of a group of individual trustees—at least one of those trustees; or

                     (c)  in any other case—the trustee.

Note:          The Financial Sector (Collection of Data) Act 2001 makes provision for annual returns and other reporting documents to be given by trustees to APRA.

             (2)  A trustee commits an offence if the trustee contravenes subsection (1).

Penalty:  50 penalty units.

             (3)  A trustee commits an offence if the trustee contravenes subsection (1). This is an offence of strict liability.

Penalty:  25 penalty units.

Note:          For strict liability , see section 6.1 of the Criminal Code .

9  Part 13

Repeal the Part.

10  Paragraph 129(1)(a)

Repeal the paragraph, substitute:

                     (a)  the person forms the opinion that it is likely that a contravention of any of the following may have occurred, may be occurring, or may occur, in relation to the entity:

                              (i)  this Act or the regulations;

                             (ii)  if the entity is a registrable superannuation entity—the Financial Sector (Collection of Data) Act 2001 ;

                            (iii)  if the entity is a registrable superannuation entity—a provision of the Corporations Act 2001 listed in a subparagraph of paragraph (b) of the definition of regulatory provision in section 38A of this Act or specified in regulations made for the purposes of subparagraph (b)(xvi) of that definition, as it applies in relation to superannuation interests; and

11  At the end of paragraph 130A(1)(c)

Add “or”.

12  After paragraph 130A(1)(c)

Insert:

                     (d)  the Corporations Act 2001 ;

Superannuation (Self Managed Superannuation Funds) Taxation Act 1987

13  Section 15DA

Omit “36A”, substitute “35D”.

14  Saving and application provisions

(1)       If, immediately before the commencement of this Schedule:

                     (a)  subsection 111(2); or

                     (b)  subsection 112(4);

of the Superannuation Industry (Supervision) Act 1993 applied to the trustee of a superannuation entity in relation to the accounting records of the entity, that subsection continues to apply to the trustee in relation to the records despite the repeal of the subsection by this Schedule.

(2)       If, before the commencement of this Schedule, an auditor had requested a trustee of a superannuation entity to give the auditor a document under subsection 113(1A) of the Superannuation Industry (Supervision) Act 1993 and the request had not been complied with, the trustee’s obligation under subsection 113(1A) to ensure that the document is given to the auditor continues to apply despite the repeal of the subsection by this Schedule.

(3)       Sections 35B, 35C and 35D of the Superannuation Industry (Supervision) Act 1993 apply in relation to a superannuation entity in respect of the year of income in which those sections commence and each later year of income.