As a trustee, you probably don’t think too much about what happens once you drop all your SMSF information off to your accountant, financial planner or auditor (referred to as your administrator here).
It may surprise you to learn that many of these services are then outsourced to other companies – often to workers in developing countries like Vietnam, India and Malaysia.
Outsourcing means that the administrator sends your SMSF information to these overseas workers to complete, usually at a much lower wage then an equivalent Australian worker would receive, the administrator will then invoice you for the work completed.
In some cases it is disclosed that the SMSF work will be outsourced, in many cases it is not.
While outsourcing has clear advantages for both you as the trustee and your fund’s administrator, recent world events have also demonstrated some of the shortcomings in the arrangement.
With social distancing measures and lockdown restrictions in place, many large work centres have had to close or operate on reduced staffing arrangements – this has naturally caused a slowdown in the amount of work able to be processed offshore. Countries such as India have been particularly affected by COVID-19 so staff may also be unavailable due to illness.
While outsourcing arrangements generally have high levels of data security, you may not feel comfortable with a stranger seeing your financial information – especially if the outsourcing arrangement has not been disclosed to you.
Can you be assured that all work is being completed to the high Australian standards and the outsourced staff are suitably skilled?
With COVID-19 causing rising unemployment rates, people are becoming more focused on ensuring jobs are created and available for people in Australia – even if it comes at a slightly higher cost.
While outsourcing is not necessarily a bad thing, it may be worth speaking to your administrator to confirm if they have an outsourcing arrangement in place and how they are managing the challenges currently facing the SMSF industry.
SMSF Australia is 100% onshore run by Australian trained accountants, tax agents and SMSF specialists to ensure everything is completed at the highest quality and to all current compliance standards.
Our turnaround time is weeks, not months and we operate 100% on cloud-based software – meaning we will be unaffected by any lockdowns or workplace restrictions. We are always happy to meet for a face-to-face appointment or speak over the phone should you ever have any questions or concerns.