Superannuation fees will soon be more transparent
ASIC has ordered super funds to make their product disclosure statements easier to understand by September.
From 30 September there will be significant changes to the way super funds present their fees and charges, making it easier to understand for consumers.
In 2015 The Australian Securities and Investment Commission (ASIC) conducted a report into the super industry and how the funds were reporting their fees and charges. ASIC found many funds were under-reporting fees, and there was a great deal of inconsistency with how these fees were represented.
ASIC found that with so many funds under-reporting their fees and charges, consumers were being misled as to the true cost of their superannuation fund. It also found the inconsistencies with how these fees were reported made it difficult for consumers to accurately compare super products side by side.
As such, the changes taking place from 30 September will see regulations in place as to what information is to be included in the funds' product disclosure statements (PDS). Later in 2018 there will also be regulations dictating not only what information is included in the PDS, but how it is presented.
"As a result, consumers will be better able to understand the fees and costs. The consistency and more accurate disclosure of fees will also help ensure that funds are competing more fairly," ASIC's statement read.
These new regulations apply for managed funds as well as superannuation funds. ASIC will conduct compliance checks throughout the industry to ensure the measures have been put in place.