ASISA RESPONDS TO PRESS REPORTS

THE ASSOCIATION for Savings and Investment South Africa (Asisa), says it has taken note of recent media reports quoting a source who implied that the Retirement Savings Cost Disclosure Standard (RSC) was developed to “expose” hidden costs in the industry and that umbrella funds would find loopholes to “hide” costs.

Taryn Hirsch, senior policy consultant at Asisa, says: “The development of this standard, as was the case with the Retail Effective Annual Cost Standard (EAC), was initiated by our members to build trust in the savings and investment industry through meaningful disclosure. We strongly disagree, therefore, that the same members would then try and look for loopholes to hide costs.”

Hirsch says Asisa members are required to submit compliance certificates to Asisa annually certifying that the RSC calculations and disclosures comply in all respects with the letter and spirit of the standard.

The certificate must be signed by the company’s chief executive, as well as the auditor, statutory actuary, or chief compliance officer.

“In addition to the compliance requirements, healthy competition between service providers will promote cost efficiency and meaningful disclosure. Our members are well aware of the reputational risks should a competitor call them out on not being completely transparent.”

Hirsch says it is important to note that the RSC, as currently envisaged, is relevant only at an employer and trustee level. “It is not a fund member cost disclosure standard and is not designed for disclosure to individual fund members. It should therefore not be confused with the EAC.”