SMSF audits explained: What they are and why they matter

Every self-managed super fund (SMSF) is legally required to be audited each year. This helps ensure funds are complying with Australia's super laws and keeping accurate financial records.

Here's what happens during an SMSF audit and what to expect.

Why does an SMSF need an audit?

The Australian Taxation Office (ATO) requires every SMSF be independently audited before it lodges its annual return.

The audit checks that:

• The fund's financial records are accurate

• Assets are held for members' retirement benefits

• The fund complies with superannuation laws

If an SMSF doesn't meet its compliance obligations, it may face penalties and could lose access to tax concessions.

What happens during an SMSF audit?

An approved SMSF auditor reviews both the fund's financial records and its compliance with superannuation rules.

The process generally follows five steps:

1. Document preparation

The auditor collects the financial records and supporting documents needed to assess the fund.

2. Compliance check

The auditor checks whether the SMSF has met its legal obligations, including record keeping, ownership of assets, investment strategy, contributions and benefit payments.

3. Transaction review

Bank statements, investment records and other transactions are reviewed to confirm they are accurate and properly recorded.

4. Asset verification

The auditor confirms that the fund's assets exist and are valued correctly. This is generally straightforward for listed investments but may require additional evidence for property or unlisted assets.

5. Audit report issue

Once complete, the auditor provides a report confirming whether the SMSF complies with the relevant legislation while identifying any issues that need to be addressed.

Audit timeframes

Once the auditor has received all the required information, they usually have 28 days to complete the audit.

Providing complete and accurate documentation upfront can help reduce delays.

What documents are required?

The exact requirements depend on your SMSF and the investments you hold, but auditors commonly request:

• Financial statements

• Bank statements

• Investment statements

• Evidence supporting asset valuations

• Trustee meeting minutes

• Trustee declarations

• Member statements

Some SMSFs may require additional documents, such as an actuarial certificate.

Who can audit an SMSF?

Self-managed super funds must be audited by an ASIC-registered, independent SMSF auditor.

The auditor cannot be a trustee, a close family member of a trustee or the person who prepared the fund's financial statements.

How does an audit fit in with the annual return?

The audit must be completed before your SMSF’s annual return is lodged with the ATO.

Trustees must appoint an approved auditor at least 45 days before the annual return due date. Information from the audit is then included in the return.

SMSF audit fees

Audit fees vary depending on the provider and the complexity of the fund.

According to ATO data, the average SMSF audit fee for the 2022-23 financial year was $640.

For Stake Super customers, the audit is included as part of the annual administration fee, alongside SMSF setup, ongoing support, annual accounts and preparation of the fund's annual return.

How Stake Super simplifies the audit process

Managing an SMSF doesn't have to mean chasing paperwork every year.

For customers who hold all of their investments on the Stake platform, we prepare the required documents, engage an independent auditor and manage the whole process from start to finish. 

Once the audit is complete, you'll review and approve your end-of-year statements before we lodge your annual return.

If your SMSF also holds investments outside the Stake platform, we'll let you know what additional documents we’ll need on our end.

Ready to spend less time on SMSF admin?

Stake Super helps take the heavy lifting out of annual audits, accounting and administration, so you can spend more time focused on your investments.

Speak to a Stake Super specialist or get started online.

This is not financial product advice, nor a recommendation that a self-managed super fund (‘SMSF’) may be suitable for you. Your personal circumstances have not been taken into account. SMSFs have different risks and features compared to traditional superannuation funds regulated by the Australian Prudential Regulation Authority (‘APRA’). Stake SMSF Pty Ltd, trading as Stake Super, is not licensed to provide financial product advice under the Corporations Act. This specifically applies to any financial products which are established if you instruct Stake Super to set up an SMSF. When you sign up to Stake Super, you are contracting with Stake SMSF Pty Ltd who will assist in the establishment and administration of an SMSF under a ‘no advice model’. You will also be referred to Stakeshop Pty Ltd to enable your trading account and bank account to be set up in order to use the Stake Website and/or App. For more information about SMSFs, see our SMSF Risks page.

Ciara Conway

Commercial Manager - Stake Super

Ciara is a Commercial Manager at Stake Super, with over 10 years of experience in the SMSF industry and an MA in Accountancy and Finance from Heriot-Watt University in Edinburgh, United Kingdom. Having previously worked at a chartered accounting firm and one of the largest SMSF administrators in Australia, Ciara has extensive knowledge of SMSF compliance. She is also a current member of the SMSF Association.