The Self-Managed Super Funds (SMSF) Sector is set to see significant growth this year.
Sundaram Business Services Group is an important global BPO services provider for SMSFs in the sector. The firm is preparing for a busy 2013 as it expects to see significant growth in SMSF Sector.
The firm anticipates that in the next 12 months, the number of SMSFs it processes will dramatically increase. In 2012, the firm handled and processed about 6,000 funds and is looking to process about 10,000 SMSFs in the coming 12 months.
There are a number of reasons for this forecast. There has been a rapid increase in the number of SMSFs, both established and in the process of being established. The infrastructure and resources will fall short in managing this growth unless steps are taken to manage them.
More staff is required by the accountants and administrators to deal with these challenges.
Australian Taxation Office (ATO) released figures relating to the SMSF sector in December 2012. The figures showed that the SMSF sector has grown by almost one third since 2008. It is now worth $440 billion in assets shared in about 480,000 funds. The ATO also noted that it is the SMSF investors who are driving the growth and are now contributing around $17.5 billion a year.
This amount is more than double the amount contributed by employers.
"We spent many years refining our systems and created one of the most secure processing environments possible, and are now moving from that establishment phase into a strong growth period," said Harish Rao, Sundaram Business Services' global head of business development.
"There is no doubt that some accounting firms and administrators are experiencing real challenges managing this growth boom and will benefit from the scalable back office that our services provide. In some cases the growth in SMSF work is diverting accounting firms from high end accounting. The sector as a whole has grown by around a third in just four years, while some firms have seen their SMSFs grow even more," he said.
As per its current structure, Sundaram Business Services has been providing back office support for accountants and SMSF administrators, but they do not provide support to the trustees of funds.
A pioneer in BPO services for SMSFs, Sundaram Business Services processes more than 6,000 funds annually at present for accountants and superannuation administrators. It is positioned well for the future and has targeted growth to about 20,000 more funds over the next four years.
Edited by Braden Becker