30 June SMSF valuation

What must an SMSF value at 30 June?

Every asset the fund holds, at market value. Regulation 8.02B of the SIS Regulations says that for the 2012 to 2013 income year and every later year, an asset must be valued at its market value when the trustee prepares the fund's accounts and statements. The ATO's guide to valuing SMSF assets says the same in plain terms: the trustee values all fund assets at market value, and the trustee, not the auditor, owns the number.

Market value has a set meaning in super law. It is the amount a willing buyer could reasonably be expected to pay a willing seller, if the two dealt at arm's length, the sale followed proper marketing and the seller acted knowledgeably and prudentially. The ATO adds that the trustee must be able to show a fair and reasonable process: objective and supportable data, good faith, a rational method and a result that can be explained to a third party.

The 30 June figure carries extra weight. The ATO says the market value of the assets supporting each member's accounts at 30 June is used to work out their total super balance, which in turn feeds things such as carry-forward concessional contributions and the non-concessional contributions cap.

Which SMSF assets need more than a statement?

Unlisted shares and units in unlisted unit trusts. Listed securities are simple: the ATO says to use the closing price on 30 June, and the published exit price for units in widely held trusts and managed funds. A private company or a private unit trust has no price on a screen, so the trustee needs evidence.

For an unlisted security the ATO expects the trustee to consider the value of the assets inside the entity and the consideration the fund paid for the shares or units. The evidence it lists includes:

• an independent valuation of the assets held by the company or unit trust
• a property valuation, where property is the only asset of the company or unit trust
• the date and price of the most recent sale and purchase of a share or unit between unrelated parties

If none of those is available, the directors or trustees need to show how they substantiated the value, including the data, method and assumptions. The ATO also says signed, audited statements that carry assets at cost are unlikely to be enough on their own.

This is the work we do. A suitably qualified business valuer at Valuation Group values the shares or units and writes a report built to be used as audit evidence. Where a trust or company owns property, we value the units or shares using a property valuation from a registered or certified property valuer that you already hold. We never sign a property figure ourselves.

Property held directly by your fund: we are not taking direct property valuations yet. If a trust or company owns the property, we value the units or shares using a property valuation you already hold.

What must the trustee keep for the auditor?

The evidence behind each value. The ATO says to keep a record of how each valuation was determined and to give it to the auditor at the annual audit. The auditor does not value your assets. They check the trustee's valuation, can ask for the documents that show how it was reached and assess whether the basis suits that kind of asset.

The ATO's note on Division 296 and SMSF audits states the test the auditor applies: sufficient appropriate evidence must support the market value reported for each fund asset under regulation 8.02B. If the evidence falls short, the ATO says the auditor should consider a modified audit report and an auditor contravention report where the reporting criteria are met.

A usable audit file usually holds:

• the valuation report, the date it is struck at and the sources it relied on
• the company or trust financial statements at the same date, plus the trust deed or company constitution
• any property valuation from a registered or certified property valuer for property the entity owns
• records of recent sales or issues of shares or units between unrelated parties
• the trustees' note of why last year's valuation was or was not still appropriate

The auditor decides what evidence is sufficient. Our report is built to be used as audit evidence and is prepared by a valuer independent of your fund: never a member, trustee or related party of it.

How do total super balance and pensions depend on the value?

The same market values are used in several places, so an error carries through. The ATO says assets supporting a pension are valued at 30 June each year for members' total super balances, on the pension start day for the transfer balance cap and on 1 July for the annual minimum payment.

For transfer balance cap purposes, the ATO accepts a reasonable estimate of a pension's value in limited cases, for example a pension starting on 1 July when a full valuation of supporting assets such as private company shares is not possible by 28 October, or a pension that started part way through the year. It says an estimate cannot be used for the fund's accounts or for exempt current pension income, which need the full market value.

From the 2026 to 2027 year Division 296 gives a further reason to get the figures right: the ATO says accurate reporting supports its calculations. Our Division 296 valuation page covers the link. We value; we do not advise on contributions, pensions or tax. Those decisions sit with the trustees and their advisers.

Can last year's valuation be used again?

Sometimes, if the trustee assesses it and writes the assessment down. The ATO says an independent valuation does not have to be redone every year, but the trustee must still consider whether the earlier one supports this year's value, decide whether it is still appropriate and document how they reached that conclusion.

The ATO says to stop relying on a valuation that has become materially inaccurate or where the value of the asset has changed significantly since it was valued. Its examples of significant events include a natural disaster, a pandemic, market volatility and a change in the character of the asset. Then the trustee should get a new valuation, use one obtained after the event or find alternative evidence.

Do not read that as permission to leave a value alone for years. The ATO contacted funds that had reported unchanged values for three or more years and, as reported, later named valuing only every three years as an outdated practice. The detail is on our page about an ATO letter on unchanged values.

What is the annual 30 June update, and what does it cost?

A valuation update for an entity we valued last year. It rolls our own valuation forward to this 30 June. Annual update: $495 + GST per entity, with delivery in 2 business days. Delivery time starts once payment and all required information have been received.

It applies when we prepared last year's valuation, the entity is the same and there has been no restructure or major change. If something major has changed, such as a new asset, a restructure or a significant event, we price a full valuation instead. Investment entity: $995 + GST. Trading business fees follow turnover on our pricing page. We confirm the fee in writing before we start. No hourly billing.

When should you order, and how do accountants send batches?

Order before the auditor needs the file, and give us the audit date when you enquire. Delivery is 2 business days for an annual update and 2 business days for an investment entity. Trading businesses with turnover $2 million to $10 million take 3 business days, and larger or complex structures are agreed before we start. Delivery time starts once payment and all required information have been received.

Accountants, administrators and auditors often have many funds to finish at once. We agree a delivery schedule for batches before we start. Our page for accountants and auditors explains how batch orders work.