ASIC reviewed a number of MySuper product dashboards from across the superannuation industry, to ensure they provide useful and accessible information to members. This review was based on the product dashboard requirements and measures set out in ASIC Information Sheet 170 MySuper product dashboard requirements for superannuation trustees (INFO 170).

‘Our review suggests that trustees have shown a good level of compliance with the product dashboard requirements for MySuper products,’ Commissioner Greg Tanzer said. ‘Some trustees have chosen to adopt the ASIC ‘mock up’ of the product dashboard. However, there are some areas for improvement to the accessibility and clarity of product dashboards.’

In particular, ASIC expects trustees will:

• show the product dashboard in a prominent position and readily accessible location on the trustee’s website. This requirement is not met if several pages have to be navigated through, or a site ‘searched’, to view the product dashboard, or the product dashboard is otherwise difficult to find. The product dashboard should be able to be seen readily by a user of the website that has no prior knowledge of the concept of the product dashboard.
• not include information within the parameters of the product dashboard that is not required by the product dashboard mandatory provisions. This is distinct from the additional information being outside and proximate to the product dashboard. The inclusion of optional information, such as asset allocation information, within the product dashboard has the potential to compromise the ability of users to compare across multiple (non-uniform) product dashboards. It may also serve to confuse users of the product dashboard.
• address all of the mandatory elements. Some trustees have omitted the past returns and return target-past return comparison from the product dashboard where there is no predecessor product. In this situation, our preferred approach is for the trustee to include all elements with an accompanying explanation to the effect that no past return information is available because the MySuper product has not been in existence for a full financial year and there was no predecessor product.
• address each of the mandatory elements separately. For example, past return percentages should not be shown in the return target-past returns comparison graph.

Trustees may include additional information outside the product dashboard to assist users. Additional information may include, for example, the use of graphs, asset allocation charts, investment risk measures and a glossary of terms. In reviewing MySuper product dashboards, we observed that the additional information provided outside the parameters of the product dashboard, but in close proximity to it, was in most instances helpful to a user in understanding the mandatory elements of the product dashboard. The overall impression formed from the mandatory elements and the optional disclosure around the product dashboard should not be confusing, otherwise the trustee may be engaging in misleading or deceptive conduct.

Trustees are reminded that it is an offence for a trustee to fail to publish a product dashboard at all, or to publish a product dashboard that is out of date, omits required information or otherwise is misleading or deceptive.

Consistent with ASIC’s facilitative compliance approach for super reforms until 1 July 2014, ASIC is adopting a measured approach where inadvertent breaches arise or systems changes are underway, provided industry participants are making reasonable efforts to comply.

The product dashboard regime for Choice products is still subject to Government consultation and was scheduled to commence on 1 July 2014. On 5 May 2014, the government released an announcement which included that the Choice product dashboard provisions will be deferred to 1 July 2015. Our review of product dashboards did not cover Choice products.

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The current penalty system for some breaches is cumbersome and out of step with the severity of the breach. The proposals, now in the public arena for consultation and due to take effect on 1 July 2013, have their origins in the Cooper Review that found that the ATO’s options were limited when it came to sanctioning SMSF trustees who failed to comply with the Act.

The SMSF Professionals’ Association of Australia (SPAA) CEO Andrea Slattery has welcomed the proposed legislative changes. “Under the current regime, the ATO has basically three options: the draconian move of making a fund non-compliant for tax purposes, applying to a court to impose civil penalties, or largely turning a blind eye.

“Clearly this situation was unsatisfactory. Making a fund non-compliant could have had the effect of halving the value of the assets – a harsh penalty in most instances – while applying to a court can be time-consuming with no guarantee about the outcome. At the same time trustees should not be able to think they can be non-compliant with impunity.”

Mrs Slattery says the proposed changes have the benefit of giving the ATO greater flexibility so that any penalty imposed is more in tune with the breach of the Act.

“Under the proposed legislation a trustee could face penalties of up to $6,600 for contravening certain aspects of the Act or regulations. “Another option open to the ATO is to require trustees to attend an SMSF educational course about their responsibilities, as well as directing trustees to undertake specified action to rectify a breach of the legislation.”

She says the decision to give the ATO the power to force trustees to attend an educational course was a “positive initiative”.

“It suggests to SPAA that many breaches of the Act are more by accident than design and that by giving trustees additional knowledge about how to comply with the Act is a sensible approach.

“The proposed changes also highlight the need for trustees to get professional advice as the ATO is unlikely to be as forgiving of breaches of the Act in a more flexible compliance regime; ignorance of the law will be no excuse.”

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