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The Documents Part 7 – Needs Analysis (Conclusion)

Risk Profile Assessment

Although not licensed to provide investment advice a standard element of advising on SMSF is determining whether the investor profile is suitable for such a responsibility.

Members who are assessed at the extreme ends of the profile need to be provided some commentary on whether an SMSF is suitable.

For example, if two members are both very aggressive investors the investment strategy needs to limit the extent of investments which may put the balance of the fund at risk. On the other hand members with very conservative risk profiles may not have the capability to even operate an SMSF and an advisor ought to recommend external course to increase their knowledge and confidence.

Anti-Money Laundering

An adviser is responsible for determining the identity of all members within an SMSF to capture the roll-over of funds from a superannuation fund that is not an SMSF (the transferring fund) to an SMSF (the receiving fund).

This means the transferring fund will have AML obligations to which it will rely on the adviser, to complete. This is a simple task where either the details contained on a Drivers’ License or Passport are added and a copy of the document is taken for the file.

As to the winding up of a SMSF or income streams from an SMSF, there does not appear to be anything in the AML Act which says that a SMSF has AML obligations.

Conclusion of Adviser Best Interest Duty

FWGS has designed the portal to minimize breaching the best interest duty by ensuring that the relevant aspects of a client’s personal circumstances and financial situation are covered.

The portal compiles the information so at the conclusion of the discussion a document is printed for the clients to sign along with the anti-money laundering and risk profile.

The original signature is retained in the file.

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