Newsletter No. 8, August 2014

Trustee Minutes

Trustee minutes are an important part of administering your SMSF. The ATO regard them as being important enough that they require you to keep them for ten (10) years. I am often asked by trustees when they should record trustee minutes and what should be recorded on them. Trustee minutes are not supposed to be difficult and with a degree of common sense you will know what should be minuted. Trustee minutes are notes made of a meeting of trustees and the decisions made by trustees at the meetings. Minutes should be prepared shortly after the meeting so that they are a contemporary and reliable record of what happened at the meeting.

What I’d like to do in this newsletter is go through the basic format of a trustee minute and what sorts of things should be minuted.

The basic format of a trustee minute

There are a number of providers of trustee minute templates. I have provided a link to a couple of free ones here and here which I like. You certainly don’t need to use a template though as most of you are more that capable of creating your own minute template with word processing software. When I worked at the ATO I liked to see the following things in trustee minutes:

  • A heading which includes the name of the SMSF with the date and location of the meeting. So for example:

RULE PTY LTD AS TRUSTEE FOR THE RULE SUPERANNUATION FUND

MINUTES OF MEETING OF THE RULE SUPERANNUATION FUND
HELD AT 287 SUNSHINE PRESS STREET ON THE 28 JULY 2014

  • The names of the persons present at the meeting. If there are any apologies these should be noted but all members should generally be present at these meetings.
  • The person chairing the meeting should be noted (in the case of a company acting as trustee).
  • The reason(s) for the meeting should be noted in the minute.
  • What was considered at the meeting.
  • Any resolutions agreed upon by the members.

What sorts of things should be minuted?

Anything of importance to the SMSF or its members should be minuted. Whenever members meet to discuss the SMSF, it’s a good idea to make a record of these meetings so if there is any dispute about the meeting at a later date, the meeting minutes are there for people to refer to. I have listed below a few of the occasions where you should consider doing a trustee minute:

  • Establishment of the SMSF.
  • When an investment strategy is reviewed, altered or changed.
  • When a particular investment was made and why it was chosen.
  • Changes of trustees such as resignation, as well as consent to be appointed a trustee.
  • When a new member joins the SMSF or an existing member leaves the SMSF.
  • Entering into certain related party investments.
  • Any decisions about entering into borrowing.
  • Documented decisions of storage of collectable and personal use assets.
  • Decisions on how assets were valued.
  • Consideration on whether to hold life insurance for members.
  • When there is a change in SMSF such as changing from accumulation phase to pension phase.
  • When the members decide to wind up the SMSF.

I always advise my clients that if there is any doubt over whether they should put it in a trustee minute, it is better to err on the side of caution and put it in a minute.

Disclaimer

Monica Rule worked for the ATO for 28 years and is a Self-Managed Superannuation Specialist Advisor. Monica is the author of “The Self Managed Super Handbook – Superannuation Law for Self Managed Superannuation Funds in plain English” www.monicarule.com.au. Her advice is general in nature and you should seek advice that relates to your specific circumstances before making any decisions.