ASFA wants workshop to clear air on fee disclosure

10 September 2015
| By Mike |
image
image
expand image

The Association of Superannuation Funds of Australia (ASFA) wants the Australian Securities and Investments Commission (ASIC) to convene an industry roundtable to enable stakeholders to work through the complexities of investment fees and costs disclosures.

In what represents a tough assessment at ASIC's efforts to deliver a class order dealing with investment fees and costs, ASFA has suggested that a one or two day workshop may be necessary to iron out the issues in debate.

"By gathering a range of appropriate industry representatives in a room, with a whiteboard and butcher's paper, and allowing sufficient time, it should be possible to work through different investment arrangement and structures, identify issues and develop solutions," ASFA has said in a submission to ASIC.

What is more it is arguing that once the problems have been dealt with by such an industry workshop, the proposed changes should be subjected to a cost-benefit analysis.

"...complying with the fees and costs disclosure regime will necessitate funds incurring significant additional costs," the ASFA submission said.

"These costs should be balanced against, and commensurate with, any benefits which are delivered to consumers. An analysis should be performed of the costs incurred compared with the benefits received and an assessment made as to the extent to which the additional costs are justified."

It said the complexity and variety of the different arrangements and structures through which investments were made created a number of difficulties in complying with the current approach and this would produce inconsistent results and lead to trustees having to incur unnecessary costs.

"By way of example, where a "superwrap" trustee invests in a managed fund this produces a different disclosure outcome when compared to any other type of trustee," it said.

"There does not appear to be a compelling policy rationale for treating platforms differently to other funds."

The ASFA submission also pointed to inconsistencies with respect to fund of funds investment, unlisted unit trusts that invest in the property market, property investment, infrastructure project investment and mandate investments in equity markets.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest developments in Super Review! Anytime, Anywhere!

Grant Banner

From my perspective, 40- 50% of people are likely going to be deeply unhappy about how long they actually live. ...

10 months 1 week ago
Kevin Gorman

Super director remuneration ...

10 months 2 weeks ago
Anthony Asher

No doubt true, but most of it is still because over 45’s have been upgrading their houses with 30 year mortgages. Money ...

10 months 2 weeks ago

The profit-to-member super funds are officially operating as a merged entity, set to serve over half a million members. ...

1 day 15 hours ago

Super Review announced 21 winners at the annual Super Fund of the Year Awards, including the recipient of the prestigious Fund of the Year Award....

2 days 6 hours ago

APRA data shows the CFMEU accounted for 28 per cent of super fund industrial contributions, with the shadow treasurer calling for a prompt investigation into the payments...

3 days 10 hours ago