Under proposed new rules for KiwiSaver, designed to make it easier for investors to know how their funds are tracking and what they are paying in fees, providers will be required to produce five annual documents.
The current reporting system, since the inception of KiwiSaver, has been criticised for its lack of rigour and manipulation by fund managers.
At the moment, KiwiSaver providers are under obligation only to provide one annual report and there is no consistency in terms of reporting methods or the nature of and presentation of information supplied to investors.
Details of the new reporting and disclosure requirements, released in draft form Tuesday by the Ministry of Business, Innovation and Employment will force providers to furnish investors with an annual statement as well as four quarterly updates. Although some providers have been doing just that there was no legal requirement for them to do so.
Commerce Minister Craig Foss said the new framework will create greater transparency around returns, fees and costs, assets and portfolio holdings, liquidity and liabilities and key personnel.
Foss said under the current reporting system it was difficult for KiwiSavers to make direct comparisons between funds.
“This is the next step in continuing to improve investor confidence in the financial sector. It is imperative that KiwiSaver providers offer transparent information for investors. Ensuring reporting standards are consistent will allow members to make better informed decisions about where to invest.''
KiwiSaver providers and the investing public are being invited to comment on the draft regulations which are set to come into place early next year.
Submissions close on 5 November 2012.
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