SMSF and liquidity risks

2014-02-07

Video Interview

An interview with David Glenn Special Counsel TAL and Drew Browne Senior Adviser at Sapience about the new and important issue facing Self Managed Super Fund (SMSF) Trustees

Summary

In August 2012, the Australian Government made an amendment to the SIS Act in Regulation 4.09. ASIC has made it very clear that compliance with Reg 4.09 is a non—negotiable requirement for SMSF Trustees.


SUPERANNUATION INDUSTRY (SUPERVISION) REGULATIONS 1994 - REG 4.09

(2)  The trustee of the entity must formulate, review regularly and give effect to an investment strategy that has regard to the whole of the circumstances of the entity including, but not limited to, the following:

(a)  the risk involved in making, holding and realising, and the likely return from, the entity's investments, having regard to its objectives and expected cash flow requirements;

(b)  the composition of the entity's investments as a whole, including the extent to which they are diverse or involve exposure of the entity to risks from inadequate diversification;

(c)  the liquidity of the entity's investments, having regard to its expected cash flow requirements;

(d)  the ability of the entity to discharge its existing and prospective liabilities;

(e)  whether the trustees of the fund should hold a contract of insurance that provides insurance cover for one or more members of the fund.


See Legislation Online

SMSF legislation regularly changes so contact us today here to see if we can help you get certainty about your situation.
Drew Browne

Drew specialises in helping people protect and provide for what matters most in their lives. He's an award-winning writer, speaker, financial adviser and business strategy mentor. His company Sapience Financial and Investment Services is committed to using business solutions for good in the community, is a member of the international B1G1 Business for Good Giving Community and in 2015 certified as a B Corp. In 2017 Drew was recognised in the inaugural Australian Westpac Businesses of Tomorrow national awards. Drew writes for successful Small Business Owners and Entrepreneurs at Smallville, his blogs can be read on Amazon.com and you can connect with him on LinkedIn.

drew browne pic

Drew Browne

Sapience Founder & Director.
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