At Audit Australia we have kept up to date with the latest targets that the ATO are looking at in regard to SMSF audits. One of the issues is unlisted unit trusts consisting of financial statements including assurance disclaimers similar to “Since a compilation engagement is not an assurance engagement, we are not required to verify the reliability, accuracy or completeness of the information provided to us by management to compile these financial statements. Accordingly, we do not express an audit opinion or a review conclusion on these financial statements.” & “The special purpose financial statements were compiled exclusively for the benefit of the trustee company who is responsible for the reliability, accuracy and completeness of the information used to compile them. We do not accept responsibility for the contents of the special purpose financial statements”.

• What does this mean?
This means that an Auditor cannot accept the infomation given in those financial statements as sufficient audit evidence when proving the market value of the investment that the SMSF has in the Unit Trust.

How We Can Help

At Audit Australia we have designed an audit program to carry out a Verification of the Value of Units in Relation to Balance Sheet Reporting in a Self-Managed Superannuation Fund. In order to do this we will initially require a copy of the financial statements and then we will issue an engagement letter to the unit trust. Once a copy of the engagement letter is returned after being signed by the trustee of the unit trust we can then advise all documents that we will require and once received we can commence the verification. Generally we expect a verification to take no more than two business days after receiving all the documentation providing we require no further information. The cost will vary depending on the complexity of each unit trust, a quotation can be provided prior to work commencing if required.

What We Will Do

We will assess the source documentation behind the unit trust's valuation for all balance sheet items to give the fair market value of the units. This service will be charged to the Unit Trust and the verification statement will be issued to the unit trust for use of all unit holders. For all funds where we have prepared the Verification of the Value of Units in Relation to Balance Sheet Reporting in a Self-Managed Superannuation Fund there will be no increase in our audit fee for the self managed superannuation fund. i.e. it will remain at $500.00 plus GST.