POWERED BY MOMENTUM MEDIA
APRA questions fitness of super fund directors
The fitness and propriety of super fund directors has been highlighted as an area of concern by the Australian Prudential Regulation Authority (APRA) in its 2012 annual report.
APRA said non-compliance with trustee policies and procedures was a recurring issue, which was particularly prevalent in the case of the fitness and propriety of directors and responsible officers.
It said the management and oversight of outsourced service providers was another area of contention.
"Trustees have been devoting more attention to risk management, but further progress is needed
to meet APRA's expectations and achieve the level of maturity of other APRA-regulated industries," APRA Chairman John Laker said.
Risk management functions suffer from under-resourcing, according to APRA, which said improvements could be made via detailed reporting to, and engagement by, trustee boards.
The regulator also flagged liquidity as an area of future scrutiny, saying trustees needed to guard against complacency in their liquidity management.
APRA said although it had noticed an improvement in trustees' liquidity management - including greater use of stress testing - there had been "little tangible improvement in the area of frozen funds".
A number of underlying schemes were being restructured or terminated, with trustees working with scheme managers to obtain redemptions or return to capital.
APRA said it would continue to grant applications from portability schemes.
The regulator said that although the Stronger Super reforms did not necessitate fund mergers, capital gains tax relief would continue to encourage mergers. APRA said trustees needed to guard against the risks of failed mergers.
AUTHOR
Staff Writer
Money Management staff writers are writers who contribute to the website from time to time. If you would like to discuss the content contained within this article please contact us.
Recommended for you
Jim Chalmers has defended changes to the Future Fund’s mandate, referring to himself as a “big supporter” of the sovereign wealth fund, amid fierce opposition from the Coalition, which has pledged to reverse any changes if it wins next year’s election.
In a new review of the country’s largest fund, a research house says it’s well placed to deliver attractive returns despite challenges.
Chant West analysis suggests super could be well placed to deliver a double-digit result by the end of the calendar year.
Specific valuation decisions made by the $88 billion fund at the beginning of the pandemic were “not adequate for the deteriorating market conditions”, according to the prudential regulator.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI Second Close
61.07 3 y p.a(%)
2
Spire Oaktree Opportunities XI First Close USD
59.21 3 y p.a(%)
3
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.56 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
31.06 3 y p.a(%)
5
DomaCom 4/27 Crombie Avenue Bundall QLD 4217 Australia
26.81 3 y p.a(%)
