Self-managed superannuation funds (SMSFs) should remain under the regulatory jurisdiction of the Australian Taxation Office (ATO) and should not be pushed within the ambit of the Australian Prudential Regulation Authority (APRA), according the Institute of Chartered Accountants (ICAA).
The ICAA has used its submission to the Financial System Inquiry to argue that the SMSF segment of the superannuation industry represents a different model to APRA-regulated funds and, as such, "does not require prudential regulation".
The submission said the ICAA had largely supported the findings of the Cooper Review into superannuation in which the SMSF segment was identified as "largely successful and well-functioning".
The ICAA submission also argues that in the wake of the collapse of Storm Financial and Trio/Astarra there is a need to instil greater stability and trust in the industry but suggests that just as there has been a push to deliver advice to consumers in a stronger regulatory framework, consumers also need to take some responsibility.
The submission said that, currently, consumer responsibility is being limited by low financial literacy due to the complexities of what individuals believe they need to know.
"Consumers — in the majority of cases — are simply looking for a trusted source of advice, to provide guidance on their obligations as well as their entitlements under various policy frameworks," it said.