You should not rely on the opinion of the financial advisor &...

You should not rely on the opinion of the financial advisor & accountant. It's the auditor ( unless the auditor and accountant are the same firm) that signs off on the audit report and they need to consider ;

1. the purchase price was at market value ( what price did you use)

• if not at market value there are serious TAX consequences (47% tax ) for the FUND and also for you
• what was the purpose ( other than Tax) for the purchase by the Fund-we understand the reasons but would any other trustee buy the shares knowing they are suspended and at risk of LEO going into liquidation.

2. is it an appropriate asset of the Pension Fund as its been suspended for 18 months
3. how will you determine the market value at 30/6/2025 and what supporting documents can you provide to the auditor.

EXTRACT from the ATO

Auditors play an important role in verifying the market value of fund assets. They must obtain evidence to support the valuations as part of their audit. If the evidence doesn't support that the valuation is at market value, the auditor should consider modifying their opinion in the independent auditor's report and lodge an Auditor contravention report (ACR), if the reporting criteria are met.

Last year, we analysed our data and identified over 16,000 SMSFs that reported assets such as property and unlisted trusts at the same value for three consecutive years. There were over 1,000 auditors involved in the audits of those SMSFs.

In March and April 2024, we contacted those SMSFs and auditors to remind them of their obligations. We then checked the value of the assets reported to us when those SMSFs lodged their next SMSF Annual Return. We found that 80% of the SMSFs updated their property valuations, but only 48% updated the unlisted trust valuation.

Where valuations were not updated and ACRs were not lodged, we commenced reviews on those auditors involved. We asked for the evidence they used to verify that the assets were valued at market value. In all cases finalised so far, we found the auditor didn't obtain sufficient evidence to verify the market value.

Trustees and auditors have continued to rely on incorrect and outdated practices, such as only obtaining a valuation every 3 years or not obtaining objective data related to the underlying assets of an unlisted unit trust.

This is a breach of their obligations and can result in penalties for trustees and compliance action for auditors.