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Anything that you wanted to know about Auditing Investments platform

Auditing an investment platform can present some challenges. Here, we tackle some of the biggest questions that you may have about this task.

There is a trend among modern investors to utilize investment platforms and the efficiencies offered. This gives out some interesting challenges to auditors and accountants. Each investment platform comes with its own set of features and reporting. You have to learn about these if you want to carry out audits with ease. Furthermore, you have to learn how to work within the confines of the platform itself and understand the tools available to you. Failure to do so could lead to a struggle to find the key information needed for the audit. Investment platforms aren’t something that you can avoid either.

The rise in popularity of managed accounts has led to more people using platforms to help manage their investments. They allow users to oversee their accounts and gain transparency. This helps to gain trust, and be consistent and believable for investors at all levels. What you may not realize is that investment platforms also offer tools to accountants and auditors.

This article refers to managed accounts and their relevance to investment platforms, what investment platforms offer for accountants and auditors, and if their data feeds are reliable or not.

What is a Managed Account?

Before getting started with anything else, the first step is to understand what Managed Accounts are. With a managed account, each investor has direct or beneficial ownership of the individual underlying investments. They then hire a professional manager to oversee the investment portfolio on their behalf. This is the key difference between managed accounts and managed funds. With a managed fund, the investor has a share of a pool of assets via issued units rather than direct or beneficial ownership of the underlying investments.

The individualized aspect of managed accounts is what has made them so popular. Using them allows the owner to tailor their investment strategy according to their own goals. They allow ease of portfolio management, which results in time savings. They also provide access to better transparency through professional management, as well as more comprehensive reporting. Often, an investment platform will be used to deliver or enable managed account services.   Investment platforms offer a good access point to managed accounts. This is because they offer a very efficient method of reporting on transactions and managing the investment.

Hence, as managed accounts gain popularity, so do investment platforms. There’s another important point to make here. You may have to audit more than one managed account when auditing the output from an investment platform. Managed accounts are only one type of investment that these platforms offer and clients can have numerous managed investments. Others include fixed interest, equities, and cash investments. Investment platforms also generally offer access to managed funds. There is an increasing trend toward using investment platforms that looks likely to continue. This means you’ll have to audit the outputs from more investment platforms more often as time goes on.

What does an Investment Platform Offer to an Auditor?

This trend toward investment platforms can seem like a scary proposition. While most auditors have worked with the outputs from platforms before, there’s an issue of complexity to consider. Managed accounts and other investment types make the auditing process more difficult. The good news is that many investment platforms offer an array of features. These features often benefit auditors and aim to make it easier for you to do your job. These features include the following:

  • Direct access to investment information for accountants and auditors:

For example, some investment platforms can offer you access to live reports. This gives you an up-to-date picture of your client’s finances and actions. These reports can often complement the end-of-year reports received and provide more detail. They cover every aspect of the transaction, in addition to that, they’re often automated. This cuts down the issues related to human errors.

  • Access to audit reports issued for the investment platform:

The issuing of these reports allows auditors to rely on the year-end data that the platform generates. The reports also offer greater transparency to auditors, clients, and advisors.

  • Access to data feeds if the platform supports them:

Many platform providers have introduced data feeds into their offerings that cover all investment types. These feeds provide greater automation of data entry and can provide greater transparency around the underlying transactions that the client undertakes.

Also, it is important to remember that each investment platform offers different features. These are only a couple of examples of what the platforms provide to accountants and auditors. Your client’s platform may not have all these features or it may have extra features that can provide you with even more help.

These differences affect your auditing approach. They call on you to learn about the specific features that a platform has to offer, but taking the time to do this usually leads to you saving a lot of time later on.

Can I Use Data Feeds?

The use of data feeds when auditing investment platforms is a contentious issue. On one hand, some platforms don’t yet have the required functionality. The use of feeds doesn’t come as standard across all platforms and the treatment of different investment types (particularly managed accounts), differs across the software consuming the feed. That does not mean you should automatically not use feeds. You just have to be aware of the source and any limitations, as you do with any feed that you use. But things have started to change. Investment platforms have started to evolve their feeds and many include tools that offer greater support to auditors and accountants who use the platform’s data.

Conclusion

Auditors must come to grips with the evolution of investment platforms. The popularity of managed accounts has led to more people using them. You need to adapt to the greater complexity of the investments that people oversee using these platforms. You also need to know about the new tools that they provide concerning accessing up-to-date data and providing online access to platform users. The key lies in understanding what these platforms have to offer. You have to take full advantage of the resources that the platforms provide. This may require some research on your part.

However, there’s a strong payoff. Accessing these tools can save you a lot of time during the auditing of accounts preparation process. Of course, using a good audit platform can speed up the auditing process further. That’s where Cloudoffis can help. Cloudoffis is an automated SMSF audit solution that allows for even greater efficiency. Arrange for a live demonstration with our team today. With Cloudoffis, you can make SMSF audits more efficient than ever before. Simply schedule your demo on the form below.

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Change in audit proposal leads to domino effect for new solutions

If enacted, from July 2019, some SMSFs may qualify for the three-year audit cycle. This change would lead to a domino effect of new struggles and new solutions. Everyone in the industry is discussing this proposed change to the audit cycle. The 2018-19 Federal Budget includes the three-year SMSF audit proposal. The idea is to reward SMSFs that have kept good records and a history of compliance. Instead of getting audited annually, these SMSFs would go on a three-year auditing cycle. According to the Treasury, this would reduce the amount of red tape that SMSF trustees have to deal with. However, the changes to the auditing industry would be significant. What consequences will SMSFs and auditors have to deal with if the proposal passes? How will it alter established auditing practices?

The Proposal

Let’s look at the particulars.

1. When Does the Proposal Go Live?

This proposal goes into effect from 1 July 2019 if passed. For the moment, we don’t know the exact audit year it would apply to and whether there would be transitional arrangements.

2. Which SMSFs Would Be Eligible?

It’s not clear yet how many SMSFs would be able to switch to three-year audit cycles. The criteria are:

  • Three consecutive years of clear audit reports.
  • A history of timely SMSF Annual Return (SAR) submissions. It’s not yet decided what this means. It might be enough that the SMSF has no outstanding SARs currently. SMSFs might qualify if they haven’t had any late SARs in the past three years. It’s also possible that only SMSFs that never submitted a late SAR would be eligible.
  • Certain key events will influence the timeline of the three-year audit cycle. If such an event occurs, the SMSF will be audited every year since its last audit, and the cycle will restart. Events include the addition, removal, or death of a member. If a member commences a superannuation income stream for the first time, the SMSF will have to be audited. LRBAs and investments from a related party would also qualify as key events. The eligibility will be based on self-assessment by SMSF trustees. However, there’s a real chance of erroneous self-assessment. If the ATO determines there’s a mistake, an audit will be necessary. The ATO might also take additional action.
3. Where Can You Discuss This Proposal?

The consultation period for the proposal ended on 31st August 2018. That being said, the Treasury received substantial feedback on the proposal from those within the industry.

4. Why Was This Measure Proposed?

In theory, SMSF trustees would have lower administrative costs as a result. There is a chance that the delays in SAR submissions would go down. The main goal is to ease the compliance burden on SMSFs.

5. Will the Proposal Affect Other Legislation?

This proposed change seems to be at odds with some new regulations. The introduction of TBARs and event-based reporting has had significant benefits so far. The industry is now moving to more real-time processing. This allows for greater transparency and oversight. Some speculate that the three-year audit cycle would cause this oversight to plummet. The Treasury’s proposal is also in contrast to the main takeaways from the ASIC Report 575 SMSFs: Improving the Quality of Advice and Member Experience. Now, let’s look at the main consequences for SMSF members, accountants, and auditors.

The Effects

The industry will change in various ways if the proposal passes. None of these changes are beneficial to auditors. Most of them will have a negative impact on the SMSFs as well.

Auditing Becomes More Difficult

This proposal would make it more difficult for auditors to conduct comprehensive and accurate audits. Three-year-old data would be considerably harder to track down. Some institutions may not maintain old data. In some cases, the SMSF may have used multiple accounts or software packages during a three-year period. This can make accessing reliable data more challenging and may present hurdles when trying to access supporting documentation. Auditors will also have far more data to analyze. This means that the time necessary to complete an audit will increase.

Auditors Will Have to Change Their Workflow

Currently, auditors have a steady workflow and increasingly better access to more timely data. But the three-year audit cycle will undo these benefits. As audits become less frequent, the workflow will fluctuate a great deal.

Furthermore, the cycle will cause issues with data and document access. It may also have an impact on how knowledgeable an auditor is in regard to their client and their circumstances. Many audit firms will have to make changes in staff and workflow. The structure of the industry will change. Since the number of businesses specializing in SMSF auditing will go down, the fees are likely to increase. The increased workload will also have an effect on fees.

SMSF Trustees Will Have Less Guidance

At the moment, trustees rely on auditors for guidance as well as oversight. In many cases, non-compliance happens by accident. In the absence of yearly audits, some SMSFs may opt for regular health checks.

In other words, they would hire auditors to do a high-level review at the end of each year. This health check would be less comprehensive than the audit at the end of the three-year cycle. But could still be the best option for SMSFs that want to avoid accidental non-compliance. Note that the check-ups would be an additional cost for the trustees. Between that and the increased auditing fees, it’s not likely that SMSFs will actually save on administrative costs in the long term.

The Penalties Will Become Higher

The longer timeframe may make it considerably more difficult to rectify non-compliance issues. When problems stay undetected for a long time, SMSF trustees have to pay higher penalties.

The Eligibility Criteria Can Lead to Problems

As discussed above, SMSFs would self-determine whether they qualify for the three-year audit cycle. For now, there are no guidelines for monitoring this. The key events that reset the cycle might go unnoticed. Trustees might have to deal with extra penalties and complexity if they misjudge their eligibility.

The Timing of the Audits Is Unclear

There’s still speculation over who will handle the timing of these audits in practice – the auditor, the trustee, or the ATO? This is one of the main sources of ongoing discussions. Who will assume the burden of determining exactly when the audit will take place?

New Challenges Related to Auditing and Accounting Software

As the cycle changes, auditors and accountants will need software updates to accommodate the changes and their new workflows. There will be changes in both cloud audit and administration software. This adds further cost to the broader SMSF industry. Additionally, there has to be a learning period for the new software, implementation of integrations, and designing new workflows. This makes the end of the first three-year cycle especially chaotic.

How Can Auditors Stay Afloat?

With triple the amount of data to audit and increasing complexity, you can’t avoid automation. There are some other ways that automation can make auditing more cost-efficient. With these solutions, it may be possible to keep workflow at a manageable level.

Cloud-based software integrations and new automation tools will make it easier to manage the altered workflow. The software industry will adapt to create packages that support auditors and accountants. These solutions will likely involve the use of new workflow models. These will ensure the automation and collaboration benefits still get delivered under the new framework.

The health checks mentioned above would maintain the active relationship between auditors and their clients and would provide a new way to continue providing guidance to SMSF trustees.

A Final Word

Businesses that focus on SMSFs have had to go through significant changes lately. With this proposal, the changes would be self-contradictory. SMSFs are still subject to increased oversight in the form of event-based reporting. But with longer audit cycles, this oversight becomes more diluted. The consequences for non-compliance would be more severe with the delay. Most auditors hope that this proposal will never pass. But if it does, there are ways to adapt to the change.

For the moment, the best way to prepare is to start improving your productivity. Find solutions that offer streamlined access to documentation and accurate data. In particular, you must look for a solution that integrates well with other cloud-based solutions. If you want to learn about the ways automation can make your work easier, contact us at Cloudoffis.

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Data feeds are time-saver, but all data feeds are not equivalent

The purpose of data feeds is to allow for the automation of data entry. Hence, data feeds are a time-saver. But there are differences between data feeds that auditors have to take into account.

Data feeds are a divisive topic among SMSF auditors. A data feed is an automated process of receiving data from a data source. Using data feeds can save an auditor a great deal of time and effort. It also reduces the administrator’s workload. The upsides are obvious. Relying on data feeds lets you go over more information, which can result in more comprehensive audits. The feeds also reduce the time needed to perform your analyses. This is a competitive industry, and auditors need every advantage they can get. Hence, it’s important to make your audits as efficient as possible. However, many auditors dislike using data feeds. They do not trust the accuracy of these feeds. Many believe that the electronic delivery process is not secure enough. There’s also a possibility that processing and technological errors may occur. This has an impact on the integrity of the data. All of these concerns have merit. But you should consider the facts before you discard data feeds from your auditing process altogether. It’s crucial to recognize that there are different kinds of data feeds. Some of these are poorly rated, but others can be extremely useful and trustworthy. Once you know what to look for, it isn’t particularly hard to tell the difference.

The Reasons Why You Can’t Treat All Data Feeds the Same Way

While they’re changing the face of the industry, data feeds are still a mystery to some auditors. But with the introduction of Transfer Balance Account Reports (TBARs), data feeds will be increasingly used to provide up-to-date data. This means more auditors will need to consider how data feeds can be incorporated into their processes. So, how do you know where to place your trust? Let’s look into the differences in different data feeds.

1. They Come from Different Sources

Using data feeds simply means getting your data electronically transferred from the source. Each institution (e.g. bank, broker, or wrap) has its own data feed setup. The quality of these sources varies. Here are a few factors you should take into consideration:

  • How does the institution source the data that is coming through your feed?
  • What is the format of the data feed?
  • Does the format impact the accuracy of data treatment?
  • Does the feed include a daily reconciliation of transactions?
  • When you set up the feed, do you also get access to historical transactions?
  • Is there a chance of someone manually altering the data at the source?

Some sources have trustworthy and robust feeds. But always look into the data source before you decide how much to trust your feeds.

2. There Are Two Different Kinds of Data Feeds

The two types of data feeds are as follows:

  • Direct-Connect Feeds

When a direct-connect feed is set up, the data comes directly from the source. This happens via an encrypted link. There are no third parties involved in this process. Since direct-connect feeds are purpose-designed, the format of your data should suit your needs. These feeds are authenticated, so you can be sure the source is valid. Additionally, you can monitor and track these feeds on your own schedule. Direct-connect feeds can automatically process income entitlements. Instant tax statements can even be set up for some of the institutions your clients are working with. With direct-connect feeds, you can also see historical transactions. If you’re worried about consistency, direct-connect feeds have you covered. The process is automated and while errors might pop up on occasion, it’s unlikely data will stop arriving altogether as it can’t be intercepted or altered.

  • E-mail-Scraping and Screen-Scraping Feeds

This is the more affordable alternative for providers. However, scraping feeds aren’t as reliable as direct-connect feeds. Here is how scraping feeds work: the source sends emails to a third-party intermediary. The intermediaries are data aggregation services which prepare a feed based on the emailed data. This process is called scraping. The scraped data can be sourced from the body of the email. It can also come from the attached PDFs. In either case, errors can happen. For example, the computers may not be able to read the data formatting in the PDFs. How do errors get resolved? The intermediary has to repair them manually. So while the scraping itself is automated, there can be delays. There is also a real chance of data loss. It’s also easy to see how this can compromise the security of the data. You also don’t have authentication in place when your data feed uses scraping. There’s a chance the initial data came from a false source. Additionally, consider the risk of interception. When this happens, there’s no guarantee that you’ll notice the data is compromised.

3. Some Data Feeds Come with ASAE 3402 Certification and Others Don’t

As an auditor, you require first-hand confirmation. Second-hand data cannot typically be relied upon. Some data feeds come with certification based on the Auditing and Assurance Standards. The ASAE 3402 (Assurance Reports on Controls at a Service Organisation) certification helps auditors to place reliance on the feeds based on the assessment of the design and effectiveness of the controls in place. A feed can only receive this certification if there are measures in place to minimise data errors. When errors do slip in, there are rectification steps you can rely on. The certification also helps auditors to understand how the data has been sourced and gain comfort that it was free from manual interception.

Why You Need to Use Data Feeds

Once again, TBARs are changing the way SMSF administration and audit work is approached. TBARs require up-to-date accounting, and data feeds are a key part of that. Automating this process makes the accountants’ lives much easier. If you’re an auditor, data feeds give you a more comprehensive access to data confirmation. But it’s very important to stay up-to-date with the various feeds. Over the past few years, auditors have been under increasing fee pressure and it’s becoming very difficult to operate  at these competitive prices and maintain a quality audit. The only solution is to speed up the data confirmation process. Hence, you should make data feeds a part of your testing procedures. You can do this as part of a wider move towards automation that includes the use of data feeds in your testing procedures. In fact, this is key to operating successfully in this environment. Always check whether the source of your data is verified. Make sure you have a clear idea of what happens to the data on its way to you. Remember that you don’t have control over what happens to the feed. Verification is a mark of trust that means you can rely on the feed.

The Final Word

With changing legislation, how to best incorporate data feeds and automation into the SMSF life cycle is  becoming a key discussion topic. It’s an important area for both auditors and accountants. If you want to stay afloat, you cannot avoid making use of automation. Incorporating data fees into the auditing process helps you to save huge amounts of time. Moreover, it can help you to identify issues that need further attention. How else can you automate your work? Cloudoffis can help you complete cost-effective and accurate SMSF audits. The platform lets you cut down on the time spent on your audit process by as much as 40%. With Cloudoffis, you can download data directly to the platform from leading SMSF software such as Class and BGL. Find out more about our cost-effective solutions, schedule a live demonstration with our team today on the form below.

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OCR technology in SMSF Audits. What is it and why it’s a breakthrough?

In the past, the SMSF audit industry has been criticized for taking too long to evolve and innovate. More recently, however, the industry is coming up to speed with developments happening in the broader software and technology space.

Cloudoffis has not only embraced new technology and artificial intelligence, it sees a bright future for SMSF auditing software development. Manual, monotonous, and time-consuming tasks have been practically eliminated thanks to Cloudoffis’ sophisticated approach to removing human error from the auditing process.

The time-saving potential this intelligent, cloud-based software offers is an industry disrupter. Cloudoffis projects these advancements will save auditors upwards of 40-50% time per audit, and what’s particularly exciting is that these benefits are being directly passed onto users.

The cost of compliance just became a whole lot more affordable.

Some of the features Cloudoffis software is bringing into the market include:

  • Integration of information, reporting and source documentation (e.g. Class, BGL, MYOB, AO, ASIC, etc.)
  • Better presentation of data and information: reducing risk of human error
  • Optical Character Recognition (OCR) and document management to enable click-of-a-button in-document searching
  • Data analysis to define the scope of work before the audit even begins
  • Advanced search function
  • Automatic referencing and tagging of documents

Cloudoffis has been able to develop these time-saving, efficiency-increasing tools and methods by identifying and understanding the problems that face the SMSF industry. With recent changes to federal superannuation fund law and changes in the Australian taxation system, Cloudoffis saw this not as a hindrance but as an opportunity to revolutionize the way auditing is done and forever improve the way the industry looks at compliance.

This software is ground-breaking in the way it saves auditors from wasting time in duplicate work, monotonous tasks, and compliance concerns.

The future is bright for Cloudoffis and the SMSF audit software industry at large. They are projected to include in the next release of their software many new exciting features including an ABN and Superfund lookup function; better reporting systems; reports and observations to be integrated with line items; a new Fund Dashboard to enhance the user experience.

Cloudoffis invites the SMSF industry to explore the possibilities of saving time, money, and wasted expertise by utilizing their new cloud-based, auditing software: endless benefits are guaranteed, including an enhanced bottom line!

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What’s next for SMSF audit technology – As future is bright in SMSF

In the past the SMSF audit industry has been criticised for taking too long to evolve and innovate. More recently, however, the industry is coming up to speed with developments happening in the broader software and technology space.Cloudoffis has not only embraced new technology and artificial intelligence, it sees a bright future for SMSF auditing software development. Manual, monotonous and time-consuming tasks have been practically eliminated thanks to Cloudoffis’ sophisticated approach to removing human-error from the auditing process.

The time saving potential this intelligent, cloud-based software offers is an industry disrupter. Cloudoffis projects these advancements will save auditors upwards of 40-50% time per audit, and what’s particularly exciting is that these benefits are being directly passed onto users.

The cost of compliance just became a whole lot more affordable.

Some of the features Cloudoffis software is bringing into the market include:

  • Integration of information, reporting and source documentation (e.g. Class, BGL, MYOB, AO, ASIC, etc.)
  • Better presentation of data and information: reducing risk of human error
  • Optical Character Recognition (OCR) and document management to enable click-of-a-button in-document searching
  • Data analysis to define scope of work before audit even begins
  • Advanced search function
  • Automatic referencing and tagging of documents

Cloudoffis has been able to develop these time-saving, efficiency increasing tools and methods from identifying and understanding the problems that face the SMSF industry. With recent changes to federal superannuation fund law and changes in the Australian taxation system, Cloudoffis saw this not as a hindrance but as an opportunity to revolutionise the way auditing is done and forever improve the way the industry looks at compliance.

This software is ground-breaking in the way it saves auditors from wasting time in duplicate work, monotonous tasks and compliance concerns.

The future is bright for Cloudoffis and the SMSF audit software industry at large. They are projected to include in the next release of their software many new exciting features including: an ABN and Superfund lookup function; better reporting systems; reports and observations to be integrated with line items; a new Fund Dashboard to enhance the user experience.

Cloudoffis invites the SMSF industry to explore the possibilities of saving time, money and wasted expertise by utilising their new cloud-based, auditing software: endless benefits are guaranteed, including an enhanced bottom line!

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How AI is standardising the SMSF audit process & boost bottom lines

A typical SMSF audit from administration to auditor takes about 2.5-4 hours. Sometimes it can take up to 8 hours for larger, more complex funds, But what if you could finish an audit in HALF that time? Yes, half and not just that,  you could deliver a 30% boost to the bottom line by instantly streamlining the process.

Here’s how you can do that.

At Cloudoffis, we provide cutting-edge software that is revolutionizing the way auditors use technology and AI (Artificial Intelligence) in the management of SMSF. Just imagine:

Scan Up To 300 pages In Seconds With An Inbuilt Optical OCR Converter With Cloudoffis:

You can quickly upload the source documentation for each of your jobs in PDF format. The inbuilt OCR (Optical Character Recognition) then converts everything into a readable and searchable document. This means at the click of one button you can search for any amount or account or any word whatsoever.

Automated Audit Checklists With Cloudoffis:

When you import a file or upload a ledger or a trial balance, the technology and API integration recognitions (i.e. with BGL, Class, ASIC, Title searching, etc.) automatically provide you with those checklists. You don’t need to provide any information whatsoever (whereas other providers have nothing more than checklists that you need to manually wade through).

Avoid The Tedium Of Tagging and Bookmarking:

Cloudoffis is the only software in the market that automates the tagging and bookmarking process. Saving you time, helping you stay compliant, and minimizing human error.

Other Benefits Of Cloudoffis:

  • Auto generation of red flags for review in an Audit Fund Dashboard
  • Reporting and observations with integrated line items
  • Highlight, comment, markup, and search easily
  • Master checklist templates
  • Upload docs all in one place
  • Seamless collaboration with all involved

Result: auditors can save up to 50% of the time per audit.

THE PERFECT SOLUTION

“I received a contract increasing our number of SMSF audits to almost 500 per year. In order to properly fulfill the contract I needed to reduce the time taken for each audit. Cloudoffis provided the perfect solution in that the program provides quick and simple tagging of relevant supporting documents as well as providing comprehensive checklists for both financial and compliance regimes.”

Peter Mangan Director, Peter Mangan Accountants Pty Ltd

For more info on all the wonders, Cloudoffis hands auditors request a live demo below today! This article was featured on SMSF Adviser, read more here

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Concerned that cloud-based software is less secure? It’s not the fact

Besides doing an accurate audit, security is probably your biggest worry. When you heard the rumours about the lack of security in cloud-based software to conduct your clients’ SMSF audits, you might have run for the hills. After all, a secure working and storage environment is key to ensure your clients’ trust. Although you’re tempted by how easy it is to work with and store data in the cloud, still-doubts linger. Are my clients’ data secure? Can I trust cloud-based systems to keep their data secure for the years to come? You need the facts–not half-truths whispered around the water cooler. Cloud-based software is not only as secure as a conventional IT system-it’s more secure. Here’s what you need to know:

Tight Control Doesn’t Mean High Security

Noted computer science professor David Linthicum wasn’t always a believer in cloud computing’s security. Although well aware of its power and scope for applications, he now is ‘finding that clouds are more secure than traditional systems, generally speaking’. The reason? Contrary to the myth, the truth is that where data is located isn’t as important as accessibility. In other words, in Linthicum’s words, ‘control does not mean security’. In fact, says Linthicum, traditional, on-premises IT systems average more Web application-based attacks than do service providers’ cloud-based systems, by a ratio of 61 to 28.

On-Premises Systems Bigger Targets for Security Threats

That’s a huge difference. Furthermore, Linthicum points out, the on-premises users had more “brute force attacks” than did the cloud-based users. Food for thought-especially since in our business-our data represents the net wealth of our clients. Like sharks when they smell blood, attackers bite when they smell money. Especially if they know they’ll have more than twice the chance of success when they know the accounting firm still uses an on-premises IT system. Again, Linthicum stresses, a firm’s preference for an on-premises system rests on a feeling; the false premise that control equals security. In fact, he points out, those companies who design cloud-based platforms “focus more on security and governance” than their old-school brethren.

The Key: A Cloud Solution that Takes Security Seriously

Instead, what a financial firm should concentrate on is to find a system with cutting-edge security technology and a proper strategy. Reducing the opportunities for an attack to breach the system should be the priority. A software firm that tests, tests, and tests again for vulnerability is the one companies who deal with the life’s savings of its clients should choose. In the 23 April 2017 edition of Forbes, Louis Columbus writes about Australians’ reluctance to hop on board with cloud solutions for fear of security breaches. Although Australia is the global leader in cloud adoption for public use, the Gulf Coast Council leads in private cloud use. Yet as cloud services increase their security for public, private, and hybrid platforms, more and more companies are coming around to take advantage of cloud services for even their most sensitive data.

Security Is Now the Competitive Edge for Cloud Providers

The question is, does your company really want to drag its heels on adopting cloud technology when it could take the lead? According to UK tech writer Ben Rossi, it is precisely the lack of confidence many enterprise companies have in the cloud that should spur them to take a second look. Because of this general reluctance of organisations to adopt cloud platforms, cloud services, says Rossi, have begun to ramp up their security to the point that they compete ‘on the security of their service’. Add that factor to the reality-not the myth-that most of the recent data breaches that have happened over the last few years occurred within on-premises IT systems. Cloud systems, too, have no personal connections-or axes to grind-with the companies they serve. As Rossi points out, ’employees with …malevolent intentions will find it more difficult’ to do damage with cloud-stored data. In most cases, Rossi says, cloud-based services must adhere to tougher standards than do on-premises systems, since cloud services handle the data for much more than just one organisation.

Choose Efficiency and Security with a World-Class Cloud Provider

The key, then, to take advantage of the lower cost and higher efficiency of the cloud while lessening your risk, is to choose your cloud provider wisely, conclude the authors of Internet security giant McAfee’s ground-breaking report, ‘Building Trust in a Cloudy Sky‘. Those Cloud First organisations who use unified or integrated security solutions have found it easier to adopt cloud services, since the heightened level of security from these security providers ‘reduce their response time to detect, protect, and correct threats to the organisation’s data’. Cloudoffis takes its clients’ security seriously. Not only does it host its servers on the highly secure Amazon Australia, but it also adheres to the highest industry standards of security implementation. To discover more about how you can boost your productivity while maintaining the highest level of security for your audit files, contact Cloudoffis today.

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Cloudoffis improve productivity of firm & is gold sponsor at ATSA 2017

Cloudoffis is a Gold sponsor of ATSA 2017 – one of the leading events for accountants & bookkeepers in practice.
Our values align with what ATSA organisers believe in – “It’s not the technology but what it can do for your firm and your clients that is key. Technology is the great enabler – enabling new efficiencies, new service opportunities, new ways to engage with your clients.”

Cloudoffis offers a brand new way of conducting SMSF audits. Developed with Auditomation, an advanced audit process automation technology, it truly enhances an auditor’s decision making process. We believe that this perfect blend of an auditor’s skills and software-assisted automation can result in high-quality and error-free audits.

At every step, auditomation enables simplicity, speed and efficiency to ensure accuracy and high quality SMSF audits.
Come to ATSA on October 16-17 (Hyatt Regency, Sydney) and ask us about how the unique auditomation technology in Cloudoffis can transform the SMSF audit process by helping you conduct error-free and high-quality audits and improving the productivity and profitability of your firm.

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SMSF Cyber Security: Measures to keep safe as we move in September

As a financial advisor, you need to know about the changes in the SMSF industry and how they will affect you. We’ve created a quick SMSF industry update, letting you know what is happening in the industry and how these changes may affect investment going forward.

Trustees Opt to Go It Alone Navigating Complex Rules

Earlier this year, Vanguard released a report which showed that one of the prime concerns among SMSF trustees in 2017 was navigating the complex and ever changing rules and regulations associated with the fund. Despite this, we are still seeing trustees opting to go it alone and figure out the best course of action themselves. Only 38% of SMSF trustees now seek assistance from a financial advisor, down from 54% nine years ago. Concern over the quality of advice and the spectre of bad experiences in the past have been cited as two of the major factors behind this, and the rise of accounting and auditing software platforms have also given trustees more scope and capability to take care of duties themselves.

Contributions Continue to Rise

SMSF investment is at a very healthy level in 2017 and looks to be continuing to rise as we move into September. The June quarter of this year saw enormous increases in trustee investment, with average contributions soaring from $9,138 to just over $32,000. This tripling in the average level of investment has been credited to the changing of SMSF rules at the beginning of July, which made it more advantageous for trustees to invest. The last time investment levels have been this healthy was back in 2009.

Increased Focus on Cyber Security

If cyber security has left the front pages in 2017, it has never been for very long. Recently, it reared its ugly head again, this time with the news that criminal gangs, particularly those based in Eastern Europe, have been targeting SMSFs in Australia. This should not be taken as a reason to panic, however. Cyber crime is the new frontier for law enforcement. New breaches simply mean new measures must be taken to keep us and our money safe. Expect a renewed focus on cyber security and tighter measures in place to keep SMSFs safe as we move into September. To learn more about Cloudoffis and how it can help you to keep on top of your SMSF auditing, get in touch with our team today. We are waiting to hear from you.

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Top 5 challenges of auditing SMSFs in 2017 – A huge rise in SMSF

There are now close to 600,000 SMSFs in operation and over 1.1million SMSF members. With this huge rise in SMSFs, the Australian Government’s policy changes are designed to ensure the sustainability, growth and flexibility of these funds. Here are the top 5 challenges of auditing SMSFs in 2017:

Events-based reporting

With the new events-based reporting set to streamline the flow of information to the ATO from 2018, any new income streams or changes to the fund will need to be reported within 28 days at the end of the quarter rather than on an annual basis. Although this doesn’t come in to effect now, all 2017 transactions will need to be reported in 2018, thus putting a lot of compliance burden on SMSF advisers. Also, firms will need to have automated processes in place.

Technological developments

Technology is having a huge impact on how we execute SMSF audits today. Audit process technologies enable auditors to conduct faster and high quality audits. Time saved via automating SMSF audit and admin processes can be utilised to get more clients and increase profitability. Smaller accounting firms might fail to stay profitable and keep up with the speed and efficiency versus firms equipped with advanced audit software.

The importance of independent audits

The Government relies on the SMSF annual audit to assess trustee compliance with the law and ensure that the integrity of the superannuation system is maintained. SMSF auditors will play a crucial role in the regulation of the SMSF sector. In fact, auditor role has now been stressed upon more than ever before. The ATO is increasing its focus on SMSF auditors who fail to meet key independent criteria.

The changing role of accounting firms

Changes in superannuation mean, accounting firms need to rethink their strategies in order to sustain in the long term in the field of SMSFs. Being accredited as specialist SMSF advisors through the SPAA (SMSF Professionals Association of Australia) or completing specialist courses should be seen as a minimum commitment on the part of accounting firms looking to be seen as serious about SMSF. It’s also crucial for accountants to obtain the appropriate licence in order to offer financial advice on SMSFs. This can help firms to continue expanding their revenue stream even further.

Disengaged SMSF trustees

With information and advice easily available on the internet, SMSF trustees have a lot of knowledge at hand and are making decisions based on that. While having the knowledge is a good thing, they might not necessarily have the specialist understanding needed to take SMSF decisions. One of the key challenges for advisers is to engage SMSF trustees with knowledge, insights and advice relevant to them.

Disruption is a natural course for any industry and change is inevitable. In order to fulfil their role in the SMSF world, auditors, advisers and accounting firms need to adapt and evolve faster than they think.

References 1. SMSF statistical report. March 2017.
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