SMSF Data Feeds: How They Reduce Accounting Costs and Simplify Your Audit

SMSF Data Feeds: How They Reduce Accounting Costs and Simplify Your Audit Automatic electronic data feeds help to speed up your annual SMSF accounting work allowing for faster and cheaper processing, fewer document requests and proactive support. Our software can accept data feeds from banks, building societies, stockbrokers, and investment platforms directly into your SMSF file, which is the reason some SMSF administrators, including ourselves, are able to offer fixed price annual packages which do not change depending on the number of transactions.

The electronic transmission means there is no human data entry error in processing the fund’s transactions, and the information is delivered securely and encrypted from the bank to the software system. It is very important to note that data feeds do not provide any login or payment access to your accounts mitigating security risks. It is a one way data push from the bank/financial institution to the software system.

How do data feeds benefit your SMSF?

Quicker preparation of financial statements and the fund’s annual return (member statement and SMSF annual tax return), ensuring the fund’s audit can be completed and enabling the lodgement of the annual return on time. A fund with hundreds of transactions could take hours to manually process vs a data feed which allocates income, buys and sells and most corporate actions to the correct accounts on a daily basis. Of course, an experienced accountant still has to check to make sure the transactions reconcile to supporting documents but this way you are paying an accountant to finalise transactions, not as a typist, keeping the prices down.
Keep records updated regularly to provide an overview of contributions and pensions, monitor caps to help to make sure they are not accidentally breached, and minimum pension payments are made, and enable timely identification of possible breaches of the super laws. Request documents the auditor will ask for closer to the transaction date, rather than many months later, when memories are not so sharp.
Reduction in time required for chasing up bank statements, investor statements, dividend and distribution advice and contract notes after the direct data feeds are fully functional as auditors will be able to rely on the bank feed for far more of the required annual evidence.
Focus on higher-level reviews to ensure the SMSF doesn’t miss strategic planning opportunities. Instead of data entry our team can spend time alerting you to members nearing pension age and to member balances approaching their transfer balance cap, concessional contribution limits and minimum pension draw downs.
Higher accuracy as transactions are not processed manually, and corporate actions, interest, dividends and trust distributions are uploaded automatically from the data feed, making sure these transactions are not missed.
Fees can be maintained at lower levels when the fund’s investments can be processed using data feeds. Our fixed price annual package for a basic fund with investments in listed shares, managed funds, wrap investments, and cash is only $1,300 (plus GST) per annum, and that includes accounting, audit and software fees. The reason the cost for this tier is so low is that the transactions can be data fed.

What automated data feeds can your SMSF access?

We partner with Class Super for processing our SMSF clients. At the moment, we can access data feeds for:

112 wrap and investment platforms
26 banks, building societies and cash management accounts
93 broker accounts

Class Super is part of the Hub24 Group on the ASX and has enterprise grade security for all these data feeds.

We can also upload data from other institutions, provided we can obtain a CSV file using CLASS SUPER’s Excel Transaction Loader.

Other Class Super integrations include:

ASX market prices, corporate actions, and managed fund data from IRESS, an Australian-listed technology company that develops and licenses software for the financial services industry.
Tracking exchange rates from the Reserve Bank of Australia (RBA) and valuations for foreign listed stocks from leading market and financial data providers.
Employer contributions are uploaded directly via the Electronic Service Address ‘smsfdataflow’.
Seamless integrations with Prop Track and RP Data (Cotality) for both automated and certified property valuations.
Direct access to most share registries, automatically confirming the fund’s shareholding in directly owned Australian equities.
Access to various actuarial providers for the provision of semi automated actuarial certificates which we pass on at cost for clients requiring them.

Authorising a data feed

There are differing levels of authorisation, including:

The client level, the SMSF, being the account holder, can authorise the commencement of a data feed.
At the adviser/dealer group level, a third-party authority (Adviser) can be obtained from an adviser registered with an institution, such as a wrap account or other investment platform.

What sort of audit assurance can Data Feeds provide?

An SMSF auditor can have read-only access to SMSF transactions in Class Super. Class Super can provide ASAE 3402 Type I and Type II assurance reports to an SMSF auditor, which can reduce the number of transactions an auditor needs to test, saving time and money. The assurance reports verify the accuracy of the automated data feeds that Class Super receives. For example, an auditor can accept that bank data transactions are accurate but may still request a current bank statement as supporting evidence of title. Automated tax statements can generally be accepted by the auditor without further verification. Automated property valuations can be acceptable supporting evidence, provided the report has a high confidence factor and shows similar recent property sales in the same area.

What don’t data feeds do?

There is still some fear that exist around misunderstandings on how data feeds actually work and their limitations. It is important to note that data feeds do not:

Allow your SMSF Accountant or software system to directly login to your account or give your bank any instructions such as to withdraw or transfer money. It is a one way data push from the bank to the software system only.
It does not replace your accountant needing to review and complete the financials and returns, data feeds help make things quicker, they do not automate the entire process.
They do not mean that we no longer need to ask you for any documentation and do not provide 100%, nor are they flawless and thus the importance of a human check.

They make your SMSF accounting quicker, cheaper and more proactive but they do not replace your SMSF accountant.

Looking for SMSF Support?

SMSF Australia is able to offer a quick and efficient online service to our clients at industry leading fixed price packages due to our use of technology including data feeds. Contact our friendly team today if you need help transferring your existing SMSF to our team or establishing a new fund.