SMSF compliance - balancing automation with price pressures
Managing compliance requirements with the rise of automation and price pressures can be a serious balancing act for SMSF auditors.
As auditors experience the pressure to reduce their audit fees to meet with a competitive market, there is an increased pressure from the ATO and the Australian Auditing Standards to maintain the same high level of integrity and quality. This pressure is a challenge for auditors who are already under pressure to master & comply with new technologies.
SMSF accountants and administrators are embracing the cloud-based technology integration of electronic data feeds, which provides more efficient ways to gather and share real-time data. These real-time feeds provide valuable information about fund information as it happens.
While the demand for cloud-based technology integration increases, pressure mounts for auditors to reduce the prices they are charging due to the automation process.
Technology based accounting systems are enabling the automation of a range of data including:
- Pre-populated audit data
- Completion of audits online – as opposed to traditional formats
- Reduction in time to complete audit
While the automation trend may certainly reduce the turnaround time of audits, there are concerns within the industry as to whether the programs meet Australian Auditing Standards. The programs are not capable of intricate and basic steps within the SMSF audit process such as risk analysis, maintenance of auditing standards and compliance checks, making the automation trend a concern for some SMSF auditors.
While it’s important to streamline processes and improve productivity in audits, professional standards must be upheld at all times. Professional scepticism exists within the industry, and it’s widely agreed that electronically data-fed programs should be tested in accordance with Australian standards on a regular basis and monitoring should be undertaken to ensure the quality and integrity of SMSF accountants using cloud-based programs.
The balancing act for compliance and automation within the SMSF audit industry will continue as auditors work to manage the equilibrium between integration, quality and proficiency of their audits.