Multiple accounts too much to handle

Background

The trustees of ABC Super Fund approached Super Plus after being referred to us by an existing client. The trustees’ personal accountant had manually prepared the fund’s financial statements and tax return for a number of years, on an annual basis.

However, when one of the members reached age 65 years and wanted to commence a pension, the accountant was unsure how to proceed with accounting for the member’s pension, and contributions made by that member, after commencement of the pension. The accountant was not familiar with the correct procedure for commencing a pension and what documentation was required to confirm the details of the pension.

The trustees had approached another administrator to prepare pension commencement documents but found that the fees to do this, and engage in the ongoing administration of the fund, to be excessive.

Super Plus Review

We reviewed the previous years’ financial statements and member statements and noted errors in the calculation of the tax free component of each of the member’s account balances.

We discussed the procedures for commencing the pension and how the fund would be administered in the future, with the pension member having a separate accumulation account for contributions made after the commencement of the pension.

Super Plus Actions

Adjustments were made to the member accounts to account for the correct tax free portion of the member balances.

Pension commencement documents were prepared for the pension member, at reasonable cost to the SMSF.

Separate pension and accumulation accounts were established for the relevant member.

Results

The trustees are now confident that the fund’s administrative tasks are now being taken care of, as required.

The fund’s transactions are now processed on a regular basis, with any concerns being raised with the trustees and dealt with on a timely basis.

The members are delighted they can obtain current balances on their member accounts, if required, and do not have wait a number of months after the year end to receive up-to-date information about their fund.

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