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Financial Synergy signs Vision as admin world explodes
Stephen Mackley
Big things are happening in the super fund administration market. AAS seems to have successfully integrated Superpartners, smaller admin systems companies are doing well and SMSF providers are proliferating. But, by all accounts, the ATO is struggling with SuperStream.
For years the quiet infrastructure provider in the super system, administration, has become a new centrepiece in the battle between big funds, led by the not-for-profits, and small funds, led by the SMSFs. Retail funds, led by the banks, are also in the fray. But it looks like technological change has thrown all the old assumptions about scale and barriers to entry out the window.
In the latest win for a small admin and outsourced systems company, Financial Synergy, Vision Super is implementing the Acurity platform for its 100,000 members. The system will allow the introduction of new mobile and digital service offerings, which is becoming increasingly important as a way to prevent high-balance members from leaving to set up their own SMSFs.
Stephen Mackley, Financial Synergy chief executive, said the Acurity platform allowed a fund like Vision Super – which is self administered – to take advantage of the additional functionality provided by a core platform and yet continue to deliver a differentiated experience for its members.
Meanwhile, the SMSF system providers, such as Class and BGL, and administrators such as SuperIQ and Xpress Super/SuperGuardian are increasingly connecting direct to trustees, rather than through accountants and other intermediaries, because of cheaper cloud technology.
And they are being challenged by the new cloud technology admin offerings, such as McClowd, which offer basic services for free and others which package robo-advice with an admin and investment (usually ETF) offering.
But back at the big end, the ATO’s implementation of SuperStream is not going as well as hoped. The initiative plans to transfer all employer-gathered super fund contributions to an electronic payments system by the end of 2016-17.
The first deadline of compliance, for employers with 20 or more employees, was postponed from June 30 to October 31. The second deadline, for employers with 19 or fewer employees, remains at June 30 next year.
But the ATO has admitted to “teething problems” and smaller employers have complained of a “heavy-handed threatening approach” by big super funds, according to small-business magazine SmartCompany.
The publication quoted Philip Hand, national program manager for SuperStream at the ATO, as saying at the end of September that the underlying error rate for contributions reported by the industry was between 5-15 per cent prior to SuperStream’s implementation. With SuperStream so far, the error rate was down to 2 per cent, he said.
– Greg Bright
