Issue 587, 4 December 2015
In this issue:
- Fees and costs disclosure: RG 97 and legislative instrument finalised
- ASFA-Veda Data Benchmark: September 2015
Fees and costs disclosure: RG 97 and legislative instrument finalised
On 24 November, ASIC finalised ASIC Corporations (Amendment and Repeal) Instrument 2015/876, which amends Class Order [CO 14/1252], and updated Regulatory Guide 97 Disclosing fees and costs in PDSs and periodic statements. ASIC also released Report 457 Response to Submissions Disclosing fees and costs in PDSs and periodic statements.
The amendments to the law and revised guidance follow ASIC’s review of fee and cost disclosure practices and industry consultation. ASIC has indicated that it will continue its engagement with industry during the transition period for the amended regulatory requirements and new guidance to assist industry in its implementation of the measures.
ASIC Report 398 Fee and cost disclosure: Superannuation and managed investment products, identified the need for industry standards or guidelines that complement guidance to help improve the quality of fee and cost disclosure, also ASIC indicated it will continue to encourage industry to come together and agree on standards that complement ASIC guidance.
As foreshadowed in ASFA Action issue 585, the amendments to the law include an extension of the transition period for the application of the new fee and cost disclosure requirements. [CO 14/1252] will now apply to:
- all PDSs from 1 February 2017
- periodic statements which must be given on or after 1 January 2018.
ASIC also intends to further defer the start date for the consistency requirements in section 29QC of the Superannuation Industry (Supervision) Act 1993 until 1 February 2017, to align with the extension to the fee and cost transition for PDSs.
ASFA-Veda Data Benchmark: September 2015
ASFA recently assisted Veda with the production of the 11th edition (September 2015) of the ASFA-Veda Data Benchmark. The Benchmark was established in 2010 to track industry improvements and highlight the issue of data integrity across a number of areas.
Key points from the 11th edition include:
- an analysis of 2.3 million active members across 25 funds, eight funds with less than 10,000 members, 10 funds with between 10,000 and 90,000 members, and seven funds with more than 90,000 members
- at 89.6 per cent, the ASFA-Veda Data Benchmark indicates that just over 10 per cent of member records have important core data that is missing or incorrect (when excluding errors in member beneficiaries, the Benchmark increases to 91.1 per cent)
- self-administered funds tend to have better data quality than third-party administered funds
- the data integrity of large funds (over 90,000 members) at 89.5 per cent is below that of small-medium funds at 93.0 per cent
- measurement leads to improvement—all six of the funds in the current ASFA-Veda Data Benchmark which have undertaken repeat audits have improved their data quality
- trustees now have CPG 235 as a guide to help improve data quality for fund members. This should encourage greater participation in the ASFA-Veda Data Benchmark
- the ASFA-Veda Data Benchmark results continue to indicate that funds need to do significantly more to improve the quality and integrity of their member data.
The Benchmark, which is updated twice a year, is available on the ASFA website.
