Advice should be embedded in super
The Investment and Financial Services Association (IFSA) has called for changes to the Superannuation Industry (Supervision) Act (SIS Act) to expressly recognise the role of financial advice in superannuation.
In its submission to the Cooper Review, IFSA has pointed out that the regulatory and legislative environment surrounding superannuation has changed dramatically since the SIS Act was originally introduced, and that it needs to be amended to reflect these changes.
The submission noted that amongst the most dramatic changes was the implementation of the Financial Services Reform Act (FSRA).
The IFSA submission has also taken a direct swipe at the level of investment in direct property and other illiquid assets by industry superannuation funds, suggesting that they should be revalued every 12 months as a mandatory requirement.
Calling for appropriate further amendments to the SIS Act, IFSA said illiquid funds or investment options should be defined as those with 20 per cent or more invested in illiquid assets, consistent with the Corporations Act definition.
It said that the illiquid assets would then need to be revalued at least every 12 months, and that illiquid funds would need to align their redemption and valuation processes to preserve equity and guard against arbitrage.
AUTHOR
Mike Taylor
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