Claire
Something does sound right here. First what is the residency status of the members in the year of audit did they pass the 183 days residency test. I get feeling that they are long term overseas residents. This would breach operating a smsf as I understand it Management of the fund must take place here in Australia, This whole thing is questionable 1. Why would the members be removed as being directors. 2. Should not all members of a smsf be either individual trustees or Director of Corporate Trustee? 3. Sounds like a clear conflict of duties in the accountant such roles. 4. What evidence is there that the members are even advised of the operation of the smsf regularly, its investments or member account balances. 5. There appears in my mind no Independence being demonstrated by the accountant in the work he is doing. 6. Drawing a long bow, does this potentially breach / contravene the sole purpose test, why such an arrangement.