Inadequacies and inconsistencies in superannuation fund-level financial disclosure: The need for a principles-based approach

Gallery, Gerry T. & Gallery, Natalie (2003) Inadequacies and inconsistencies in superannuation fund-level financial disclosure: The need for a principles-based approach. The Australian Economic Review, 36(1), pp. 89-97.

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Despite an extensive regulatory framework designed to protect the interests of superannuation fund members, there are widespread concerns in Australia about the adequacy of that framework. The recent downturn in superannuation investment returns, the proposed introduction of ‘member choice’ and superannuation fund and corporate failures have contributed to demands for further regulation, particularly regulation aimed at improving fund disclosure. Although these demands have prompted disclosure reviews and reforms, the focus has generally been at the product or consumer level; very little attention has been given to improving disclosure regulation at the fund level. In this paper we argue that the narrow regulatory focus ignores the "bigger picture" in that it is important to establish an optimal disclosure and reporting framework which encompasses reporting at the fund level as well as at the product/consumer level. Such a conceptual approach has been successfully used to guide the regulation of corporate financial reporting for more than a decade in Australia and even longer in other jurisdictions. By contrasting corporate reporting with reporting by superannuation funds, we show that a principles-based approach to regulation has the potential to provide a sound basis for ensuring consistent and transparent reporting to fund members and at the same time, minimise the risk of regulatory failure.

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ID Code: 4929
Item Type: Journal Article
Refereed: Yes
Keywords: Superannuation, Financial disclosure, Regulation, Principles, based approach, Financial reports
DOI: 10.1111/1467-8462.00269
ISSN: 0004-9018
Subjects: Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > ACCOUNTING AUDITING AND ACCOUNTABILITY (150100) > Financial Accounting (150103)
Divisions: Current > QUT Faculties and Divisions > QUT Business School
Copyright Owner: Copyright 2003 Blackwell Publishing
Copyright Statement: The definitive version is available at
Deposited On: 04 Sep 2006 00:00
Last Modified: 29 Feb 2012 13:21

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