Single email address a digital approval barrier

SMSF digital signature

SMSF trustees may be limited in their use of any measures allowing the use of digital signatures to approve fund documents due to their email set-ups.

SMSF trustees may be unable to enjoy all of the benefits of the proposed digital signature protocols due to the nature of their personal email set-up, a technical specialist has said.

Smarter SMSF chief executive Aaron Dunn recognised many SMSF trustees often use one address for all of their email correspondence and this situation could complicate approving the fund’s critical documents electronically.

“We have seen the government last year look at modernising business communication and [it used] a really good example around binding death benefit nominations [as to what it is trying to achieve],” Dunn said.

“When we look at the requirements for signing a binding death benefit nomination, it needs to be witnessed by two parties and they can’t be obviously beneficiaries of that [nomination], so what the paper talks about is using digital signing to remove the need for the witnessing because [the electronic protocols will provide the means of] verification of that individual.

“So the challenge then is how do we verify who that individual [digitally signing the document] is [if more than one individual is] using the same email address.”

According to Dunn, the crux of the issue is if two trustees are using the same email address, there would be no way of being able to prove one trustee was not electronically approving documents on behalf of the other.

“Therefore [a situation where a single email address is used for all electronic correspondence would create] some pretty big hurdles I would have thought because you’re not showing enough evidence to verify the difference between the two individuals,” he said.

ASF Audits head of education Shelley Banton identified a particular cohort of SMSF trustees who would most likely experience this set of circumstances.

“It’s an interesting dichotomy simply because you’ve got a lot of trustees who really do only work off the same email address, especially older trustees, so it will be interesting to see how this plays out,” Banton said.

The government has this year been exploring the possibility of increasing the use of electronic business communications and electronic approval protocols for official documents.


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