Since establishing our SMSF administration business in 2010, we have traversed the wild places of the industry. We have made this journey by learning through experience as our clients have done, or are doing, now. We have learned how to avoid the trips and traps, and how to strengthen our business to ensure we can maintain a great service to our clients, while making a profit.

Below, you will find our top ten tips on managing SMSF’s. We hope some of the ideas can help improve your SMSF business, or at least improve your SMSF administration experience.

1. Get the Most Out of Your Software

If you are running web-based software, and I hope you are, it will have the ability to add data feeds for your clients’ bank accounts, share broking accounts, master trust platforms and much more.

Setting up data feeds is a manual process, but you only need to do it once. Clients will need to sign the paperwork authorising the feed, and different organisations have different signing requirements, but getting this done pays dividends for your client.

The advantage of a data feed is that you get the information in a timely manner, which will allow you to follow up on unknown transactions when they are right in front of you. Data feeds also ensure that you and your clients can access up to date reporting, as well as being able to meet ATO reporting requirements.

Establishing data feeds also improves client retention. Clients are less likely to look for options if they need to redo this process every time they change administrators.

2. Set Up A Mail House with Third Party Authorities

Clients are just like us…they love having less work to do. You may have heard them ask, “Why don’t you do it,” in response to a request to collect documents. Well, as you know, it is not that simple. Without a signed authority, any compliant business will tell you to get knotted if you ask for the client’s statements to be sent to your address.

However, with a client authority, administrators can access each rental statement, insurance renewal, or annual tax statement.  No more chasing clients for routine paperwork.

Go home early one day! You’ve earned it!

3. Have Regular Client Contact to Reconcile Cash Movements

I was that client who bought and sold unlisted assets or loaned money to private companies without the paperwork to back it up, leaving the accountant, and auditor, with a mess.

Now, I love reconciling my fund monthly! It ensures that I have the documents to substantiate the transaction while it’s “top of mind,” not in a years’ time when I can’t even remember; or I can go back to the business quickly, and request more or better information.

Staying in contact with the trustee each month, or whenever they transact, solves difficult to reconcile entries much more quickly for your practice and for the client.

It is not negotiable. Start doing it.

4. Use Friction Free Fee Collection

When you start reconciling more frequently you can start billing more frequently. This improvement can cause friction initially but trust me, it is the medicine they need. The end of the year battle to get a fund lodged, which ends with a juicy invoice, is difficult to swallow. Surprises are wonderful if they are gift wrapped or go “pop,” but if they have the word invoice at the top, they are less wonderful.

Fixed monthly direct debits from the fund eliminate surprises and stop you from chasing money for work you have already done. It’s also great for client retention; that’s a win-win!

5. Maintain a Centralised Query System

Maintaining a system to deal with fund queries is useful to manage multiple and complex funds. Clients sometimes only answer the questions they know and leave the rest. It’s our job to follow them up. As a manual process, that is a real time waster.

Where you have a couple of staff members working on funds, multiply the wastage.

If you can get yourself a query management system that allows administrators and trustees to respond in real-time, you will save valuable time and frustration. A good starter is Jira. You will need to be able to visualise the outstanding tasks, complete some reporting, and have enough area to add notes and files, but it is worth it.

6. Organise Document Handling

When it comes to handling fund documents for many years, you can waste considerable time if it’s done poorly. We have found it useful to, firstly, come up with a category system that enables all stakeholders to organise fund documents into the right “bucket.” Second, once in there, add a decent description and assign it to a financial year. Finally, set up a way to process each document ASAP, and then mark them as processed once you have reconciled them.

It is amazing. The accountants will love it because they get paid too much to sort through PDF’s. At audit time, it’s a breeze!  Every year, run the same program, add new documents to the file, in the right category, the right financial year and with sensible names.

Come in late one morning, drop the kids at school, or perhaps grab a coffee with someone special!

7. Maintain a Good Relationship with Your Fund Auditor

Surprisingly, this is not hard to achieve. Auditors have a difficult job and, as recent cases show, a risky one too.

We work with our auditors to provide clean, organised, files with the required proofs available from a single structured source (see above).  We also try to understand their position. For example, where a client is unable to substantiate a transaction, we seek clarification from the client about what happened. We ask for emails, agreements, or other records to show that a particular transaction is recorded as well as possible. We try to tell a story.

Sometimes, we work with the auditor to ensure that clients understand the circumstance in which they have found themselves, and the avenues available to them. Good communication can resolve a stalemate and provide a quick, and more palatable, outcome.

8. Use Digital Signing for Trustees

It is 2021 people, let’s get digital! Now, I don’t like everything about the modern age. Some of it is impersonal and beige, but digital signing is great.

Where trustees need to sign off on accounts or other important fund compliance, get yourself a digital signing solution.

It does not matter where the clients are in the world, if they have a device and an email, we’re in business. Thank you, evolution!

9. Hire Local Professionals, Trained in SMSF Compliance

Offshore processors are fine, however most struggle to understand the finer details of compliance and their work sometimes requires double checking. Cleaning up other people’s work is like cleaning up someone else’s house…that is a firm no thanks.

Local skilled professionals are readily available in the same time zone, and they fully understand the requirements and expectations of the clients.

Clients want to speak to someone who understands their problem and who can provide an answer they can understand. Hire local people with local skills to reduce time wastage for clients and advisers.

10. Access Heaps of Useful Resources

To complete a set of SMSF accounts we sometimes need items such as actuarial certificates, valuation software, title searches, minute templates or a fund investment strategy. These need to be sourced.

Using a business who has all of these in house is a great way to save time and energy.