MEDIA RELEASE Although some superannuation fund trustees have pushed back against ASIC and APRA’s recent joint letter about ensuring fees charged to members are correct and in their best interests, with the right data processes this is not difficult task, says Tom Seel, Product Lead, Technology, QMV.
“With the right software in place, superannuation funds can perform regular data checks quickly and easily.
“Our data quality software Investigate already performs route checks across a number of fund member data.
“This can provide both an indication of where fees may require attention to ensure that best interests for the member are being met, while also identifying discrepancies and remedial actions to ensure compensation takes place,” Mr Seel says.
“This type of ‘interrogative’ approach – which in addition to prevention and remediation is one of the three approaches advocated by the regulators – can quickly provide RSE licensees with an assessment of their current state of health on any fee for service issues.
“This approach provides clarity around the present state of the fund’s data in relation to fees, but can also help ensure its future compliance.
“Indicative data checks can be undertaken to ensure that fees seem reasonable and meet basic logic checks, for instance that a change in insurance premiums corresponds to a change in cover.
“Comprehensive data checks, in contrast, can ensure that fee amounts have been calculated and deducted correctly.
“Eligibility checks meanwhile, can ensure fees charged are consistent with authorisation and member’s best interest.
“These types of checks range from simple comparisons (e.g. member status is inactive or even deceased) to complex eligibility criteria that includes employment and fund commencement timeframes.”
“Depending on the software, most data checks can be up and running within a day or a matter of hours. However, checks are only as valuable as their effectiveness and timeliness. The more regularly run, the faster potential problems are identified and subsequently the remediation effort is reduced.
“Although many challenges lie in the road ahead to not only better meeting the oversight of fees but also data quality for members in general, an interrogative approach can yield benefits today while also investing in the future,” Mr Seel says.
“This will result in better outcomes for super fund members, and a more streamlined data approach for superannuation trustees.”