Super trustees on notice over resourcing
Superannuation fund trustees are on notice that they will have to make resourcing of their services a factor in the risk management strategies they file with the Australian Prudential Regulation Authority (APRA).
The regulator has also warned that while it is not normal practice, APRA has the power to impose a specific minimum level of financial resources to be held by a trustee as a licence condition.
The warning has come in new guidance notes issued by the regulator this month in which it warns that inadequate human, technical or financial resources may interfere with the capacity of a trustee to properly carry out their fiduciary business.
It said in these circumstances, trustees need to use their risk management strategies to set out how they will monitor and maintain the adequacy of resources available.
The guidance note then cautioned that APRA might seek to substantiate their claims on resourcing by seeking evidence of appropriate due diligence by trustees on the financial capacity of service providers to remedy any failings in providing contracted services or agreements under which an employer sponsor or other party commits to providing ongoing material support.
It said when operations were conducted in-house, APRA would expect a prudent trustee to demonstrate appropriate recruitment and induction processes, as well as succession planning for key roles.
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