False and Misleading Information from Industry Super Australia

Parts of this post about false and misleading reporting by Industry Super Australia have been reported in Money Management and SMSF Adviser.  Click on the Money Management logo or the SMSF Adviser logo below to see how my views were reported in the media.

Industry Super Australia in a recent briefing note, states that

“The average ROA (Return on Assets) for SMSF members (for the 2015-2016 year) was on par with APRA regulated funds but below the 4.1 per cent achieved by industry funds during the same period”.

This statement is based on analysis undertaken by Industry Super Australia on data on SMSF performance contained in the publication “Self-Managed Superannuation Funds – A Statistical Overview 2015-2016”, issued by the Australian Taxation Office in January 2018.

And as far as I am concerned, this analysis and statement by Industry Super Australia is either an example of poor research and analysis by Industry Super Australia, or a case of deliberate misleading reporting.

As Industry Super Australia knows, the returns reported by APRA and industry funds are exclusive of member’s insurance premiums.

It would take Industry Super Australia less than five minutes of reading the Glossary attached to the ATO publication to determine that the returns reported by the ATO in its analysis of SMSF performance are net of member’s insurance premiums.

And if Industry Super Australia were still not sure, they could do what I have done and clarify this with the ATO.  The exact response I have received from the ATO SPR SMSF Stats team was “In the 2014-15 and 2015-16 reports, insurance premiums members are part of the ‘total expenses’ and the ‘total investment expenses’ category.”

So Industry Super Australia in this briefing note are comparing apples with oranges.

They are comparing the performance of industry funds excluding insurance premiums paid by members, with SMSF performance including insurance premiums paid by members.

And should Industry Super Australia, or any of its members, include in any of their advertising material, claims that industry funds outperform SMSF’s, then they run the serious risk of a formal complaint against them for misleading and deceptive advertising with both the Australian Competition and Consumer Commission (ACCC) and the Advertising Standards Bureau.

And as an aside, I have asked the ATO to split out member’s insurance premiums so that we can perform a like for like comparison, but they have declined to do so.

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Do you and your family a favour and start taking steps so you can improve the health of Your Wealth and get off the treadmill of working till you drop.

Wayne Wanders

The Wealth Navigator

wayne@thewealthnavigator.com.au

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