This letter sets out Australian Prudential Regulation Authority’s (APRA’s) response to feedback received on proposed minor amendments to reporting standards introduced under Phase 1 of the Superannuation Data Transformation (SDT). Draft proposals were released for consultation through the SDT minor amendments Discussion Paper on 7 November 2022.
The minor amendments outlined proposed minor and clarifying amendments to the existing reporting requirements for expenses and investment option reporting in order to:
- improve the consistency and comparability of asset allocation reporting to remove the need for best endeavours reporting through updates and enhancements to classifications, definitions, and instructions.
- reduce the reporting burden on industry for specific investment option types; in particular, a reduction in the frequency of reporting where both the investments are managed by, and the asset allocation is set by, an external non-connected entity.
- extend the reporting due date for some reporting items and reduce the frequency of reporting on updates to products, fees and costs and default insurance disclosures to ease reporting burden.
- improve the consistency and comparability of expense reporting and align definitions to other reporting and disclosure requirements in the Annual Member Meeting (AMM) notice.
- allow for a materiality threshold to be applied to identifying small payees. Payee details must be reported for all payees who are service providers, related parties, industrial bodies, and payees who are paid a Political Donation, or a Marketing related expense subject to a dollar threshold.
Consultation closed on 2 December 2022, with nine written submissions received in response to the proposals. APRA also held two round-tables, two working groups with RSE licensees as well as meetings with superannuation industry stakeholders and RSE licensees as requested.
Submissions were generally supportive of the proposed minor amendments but raised some issues, particularly relating to the proposed implementation timeframes and the ongoing time required to source and compile investments data each quarter. In response to consultation feedback:
- APRA has revised some implementation timeframes in response to consultation. The revised timeframes are outlined in the next steps section;
- APRA has adjusted the timeframes for investment option reporting for specified reporting tables from 35 days to 40 days;
- APRA has included payees who are paid a sponsorship related expense in the list of payees where payee details must be reported, regardless of the expense amount, and revised the materiality threshold for identifying payees for other marketing related expenses from $10,000 to $5,000; and
- APRA has also incorporated feedback on proposed definitions where appropriate.
The marked-up final reporting standards accompany this paper in Attachment A, and a summary of all changes made in response to consultation is outlined in Attachment B.
The consultation also raised concerns from industry that RSE licensees will not have sufficient time and capacity to implement the minor amendments as well as engaging with planned consultation on Phase 2 reporting standards.
In response to this feedback, together with the complex scope of Phase 2 and the regulatory changes impacting RSEs, APRA has revised the Phase 2 consultation timeline. The revised Phase 2 timeline is available here.
APRA intends to release updated APRA Connect artefacts and make the updated reporting forms available in the APRA Connect test environments in early 2023.
As outlined above, APRA has amended the implementation timeframes for the updated reporting standards. The due date for reporting under the revised reporting requirements are outlined in Attachment C.
APRA intends to consult later in 2023 on the confidentiality and publication of expenses under Reporting Standard 332.0 SRS Expenses (SRS 332.0); asset class characteristics 1, 2 and 3 under Reporting Standard SRS 550.0 Asset Allocation (SRS 550.0); new reporting columns introduced under Reporting Standard SRS 605.0 RSE Structure (SRS 605.0) and the fees and costs arrangements tables under Reporting Standard SRS 606.0 RSE Profile (SRS 606.0).
APRA does not intend to consult further on confidentiality for data which has already been determined non-confidential where there have been minor and machinery changes, including all other data under SRS 550.0, SRS 605.0 and SRS 606.0; Reporting Standard SRS 251.0 Insurance; Reporting Standard SRS 705.0 Components of Net Return; Reporting Standard SRS 705.1 Investment Performance and Objectives; and Reporting Standard SRS 706.0 Fees and Costs.
If you have any questions, please contact SuperannuationDataTransformation@apra.gov.au
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