Industry funds cite ASIC, FASEA and Hume on intrafund advice
Industry superannuation funds have expressed confidence that they can deliver limited scope advice in a totally compliant manner citing the Australian Securities and Investments Commission (ASIC), the Financial Adviser Standards and Ethics Authority (FASEA) and the minister, Senator Jane Hume.
Answering questions on notice from the House of Representatives Standing Committee on Economics, Industry Fund Services (IFS) said it was confident that limited scope advice “can be delivered in a compliant manner”.
NSW Liberal backbencher, Jason Falinksi had suggested during committee hearings that IFS believed there was a way around the best interest test, something that IFS denied.
In its response to Falinski’s question on notice, IFS cited the fact that “ASIC has guidance on foot (RG244) on the steps required to deliver limited scope advice, and FASEA has directly addressed the issue (FG002) stating that ‘A limited scope engagement can be a highly effective tool to provide clients who have limited means or resources to access comprehensive advice’”.
IFS also noted that ASIC’s Report 639 Financial advice by superannuation funds examined a sample of intra-fund and scaled advice provided by superannuation funds.
“The majority of that advice was compliant with s961B, 961G and 961J of the Corporations Act. ASIC provided additional tips to trustees and advice providers to ensure compliant scaled advice and intrafund advice.
“In April ASIC granted relief to trustees delivering scoped advice in relation to early release of superannuation, including a no action approach where trustees provide this advice through a collective charging (intra-fund) model.
“The FASEA chief executive was reported as providing assurance to an SMSF Association webinar that limited scope advice can be compliant with the FASEA Code of Ethics and Senator Hume is reported to have recently called for industry to offer more scaled and single issue advice, calling for ‘a far more prominent role for single issue advice’,” the IFS answer said.
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