VIS­I­BIL­ITY IM­PROVES

Money Magazine Australia - - INVESTING -

You can ex­pect to see some changes to how in­vest­ment fees are dis­closed by your su­per­an­nu­a­tion fund, thanks to reg­u­la­tions RG 97 from the Aus­tralian Se­cu­ri­ties and In­vest­ments Com­mis­sion (ASIC).

The changes are de­signed to bring more con­sis­tency to the way funds de­scribe their in­vest­ment-re­lated costs. This is ex­pected to help mem­bers com­pare prod­ucts.

But Damian Hill, CEO of REST, says the new dis­clo­sures could po­ten­tially mis­lead con­sumers, as re­port­ing de­pends on how the as­sets are held.

But the greater look­through of trans­ac­tion and oper­at­ing costs is ex­pected to add to cur­rent fee struc­tures, says Kirby Rap­pell, from Su­perRat­ings. “The im­pact would vary across su­per funds, with funds in­vest­ing in al­ter­na­tives and un­listed as­sets ex­pe­ri­enc­ing higher fee in­creases,” he says.

In­dus­try su­per funds hold 9% on av­er­age of their as­sets in un­listed in­fra­struc­ture. “We ex­pect that many of these fees are de­ducted from re­turns cur­rently but are not clearly dis­closed as fees in some in­stances un­der cur­rent re­port­ing re­quire­ments.”

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