· On 7th August 2019 the SMSF have invested $290,000 by way of loan to XYZ at 9% interest per annum.
· Loan documents were done however there is no security documents in place for this loan.
· Total assets of the fund is $328,633.53.
· Total loan equates to 88% of the fund’s assets.
· We were informed by the trustees on 15th December 2020 that the trustee are in process of arranging paperwork to document security.
· On 17th March 2021 we were provided with bank statements showing that loan have been paid back with interest.
· Loan was unsecured for the period of approximately 18 months.
· While the investment strategy covers this loan & the interest is high, I have seen that the loan has been repaid with the interest, but there is an issue of 88% of funds asset invested by way of loan without any security.
As an Auditor what I am suppose to do?