First off, the ATO has sent more than 17,000 letters to SMSF Trustees and auditors regarding investment strategy and diversification.  But you knew that.

The question is what to do about it? AND what is the LEGAL thing to do about it.

  1. This is not the only compliance letters that will hit your clients over the next while so it is time to take a step up in compliance – SIS Act compliance.  Section 52B(2)(f) requires the Trustee of a SMSF to prepare an investment strategy that covers a lot of issues – cash flow, member’s ages, investment objective, diversification and so on.  Importantly trustees are responsible but so too are auditors and accountants/administrators.  Let’s face it our SMSF Trustee clients have no real idea on compliance so they expect their accountant or administrator to handle it.
  2. As a SIS compliance measure you need to help the client out.  There are two ways.  One go to the LightYear Docs Support Centre and download the Investment Strategy Questionnaire and get them to complete it: IS Questionnaire Link Once they have completed it then you can take their record and formally complete the Fund’s investment strategy on LightYear Docs for $49 or if you are on an unlimited plan, a lot less than that.   Alternatively send them a letter covering the ATO issues advising you can help for a fee (generally between $389 – $450) or if they want to do it themselves that is fine provided they indemnify you for any losses.  The Investment Strategy letter can be found here:  Investment Strategy Letter


Both letters are free and our give back to the industry.  You will soon find out that at LightYear Docs we are different from other firms as our directors are accountants, lawyers, SMSF specialists and paraplanners so we know the hard part of communicating with clients and dealing with real issues.  That is why we solve them simply and effectively.

I will be discussing the investment strategy issue during my SMSF Strategy and Estate Planning day round Australia starting next Tuesday in Adelaide 15 October, Perth 17 October, Melbourne 21 October, Sydney 23 October, Brisbane 25 October and Gold Coast on 28 October.  If you have not booked go to https://ilovesmsf.com/roadshow/ and early bird tickets are only $195 but if you are a registered LightYear Docs user then the registration fee is $145.

I look forward to seeing you there and unveiling my literally, mammoth estate planning strategy automation where you will be able to do the works from EPOA, deed – both discretionary trust and SMSF upgrades, Binding Death Benefit Directions, Wills and Testamentary Trusts in less than 20 minutes.  It is literally unbelievable and worth your time and effort to make it to the day.

P.S. An investment strategy is not a financial product so accountants and administrators can complete one – using one of the two methods above as I intend covering on the day.  The real risk is in not helping a client complete one or completing one on their behalf as any investment transaction will breach the SISA rendering the accountant/administrator liable for any losses.  So take the hint and do it.

P.P.S.  A few advisers have taken the lead on this issue and sent it to all their SMSF clients with more than 50% going ahead with an investment strategy review and update for $380+.

– Stay Strategic!

Grant Abbott
CEO, LightYear Group
Incorporating LightYear Docs, I Love SMSF & SMSF Training Group