The Australian Prudential Regulation Authority (APRA) late last week released final reporting requirements for superannuation entities, with significant changes from the original draft based on industry feedback.
However, Australian Institute of Superannuation Trustees (AIST) project director David Haynes told InvestorDaily it is important to look at the overall Stronger Super package to get an idea of the full impact.
The new data reporting requirements are important because they bring superannuation in line with what the government and regulators ask from the banking and insurance sectors.
“They want it to be up to date and granular, as applies in other sectors,” Mr Haynes said.
The new requirements, however, are also critical both from a consumer perspective and critical to what MySuper is all about because they will help to make superannuation transparent and comparable, he said.
“Information that’s used in data reporting requirements has to be used by super funds in all of their marketing, on their websites, fund documentation and on their product dashboard,” he said.
The Stronger Super exposure draft outlined the government’s expectations for funds’ reporting of the MySuper product dashboard, including requirements that all information be published on the fund’s website with detailed investment information.
However, the product dashboard was cut from last week’s updated reporting standards, as it remains the subject of further consultation.
Mr Haynes said the AIST welcomed the fact the government is continuing to listen to the industry to revisit product dashboard issues, but it increases the time pressure in terms of getting this right because the product dashboard has to be posted when MySuper products are launched – which would be as early as July 1 this year for many funds.
When it came to audit requirements, Mr Haynes welcomed the fact that rather than requiring a full annual audit, the new standards contain a subset of items to be audited. “The driver of that is cost – audit processes are not cheap; if you greatly increase audit costs that will get passed on to super fund members,” he said.
Mr Haynes continued that, broadly speaking, the new requirements mean funds are moving towards being required to provide thousands of pieces of data whereas currently they only have to provide a few hundred, which could create pressure for some funds.
There are likely to be some teething problems in putting things together, especially when information is coming from third party entities like fund managers, administrators and custodians, he said.
“There are all sorts of administrative and technology issues in making sure you can gather all of the information and have confidence in the accuracy of that information and deal with it in the right way and get it to APRA,” Mr Haynes said.
“They are real and significant issues but the big issue behind that is making sure there’s transparency and comparability in the system.”
