How To Grow The Superannuation Industry

Transcription

1 Evolving Superannuation Industry Trends November 2012 kpmg.com.au

2 2012 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. All rights reserved. The KPMG name, logo and cutting through complexity are registered trademarks or trademarks of KPMG International Cooperative ( KPMG International ). Liability limited by a scheme approved under Professional Standards Legislation.

3 NOVEMBER EVOLVING SUPERANNUATION INDUSTRY TRENDS 1 Contents Executive summary... Page 2 Overview of the superannuation industry... Page 4 Segmentation... Page 8 Membership demographics...page 12 Consolidation and scale...page 14 Conclusion...Page 17

4 2 EVOLVING SUPERANNUATION INDUSTRY TRENDS NOVEMBER 2012 Executive Summary Superannuation remains a vital component of the Australian financial sector and the broader economy. The Australian superannuation industry accounts for 21 percent of total Australian financial institution assets, putting its share second only to that of the banks. Superannuation assets are equivalent to approximately 120 percent of the Australian share market capitalisation and 90 percent of Australia s annual GDP, significantly higher than the OECD weighted average. Australian superannuation system assets grew by approximately 10.5 percent per annum in the decade to e 2012, increasing from approximately $500 billion to $1.4 trillion, making superannuation a resounding success in Australia. However, this period of significant growth has disguised some significant changes in the industry. In the decade to e 2012 the small funds segment (predominantly selfmanaged super funds) has overtaken the public sector and retail funds segments to become the single largest sector in the Australian superannuation industry. Almost one third of superannuation assets now reside in self-managed superannuation funds (SMSFs). The industry funds segment is the only other segment that grew its share of superannuation fund assets over the same period, increasing from approximately 14 to 20 percent of superannuation system assets in the decade to e The primary driver of growth in the self-managed segment has been the disproportionately high value of assets per member that have been transferred (i.e. rolled over) from other superannuation institutions to SMSFs since choice of fund was introduced in July Compared to the other segments, the SMSF segment now has by far the highest average balance per member account. Over the past five years the average balance per member within SMSFs has also grown faster than any other segment. More generally, there is a pronounced and persistent trend towards consolidation of superannuation institutions in Australia. Combined with the resilience of contributions into the system, consolidation has resulted in the average size of superannuation institutions (measured by assets) increasing significantly during the decade to reach $2.6 billion at e The popular justification for this increase in scale is its potential to generate better outcomes for superannuation fund members via lower total costs. In practice, the phenomenal growth in the average size of superannuation institutions in recent years has yielded disappointing results in terms of lowering total costs per member. Thus in the five years to e 2011, despite fund average size almost quadrupling, total costs per member (measured in dollars) actually increased by approximately 6.6 percent per annum in nominal terms.

5 NOVEMBER EVOLVING SUPERANNUATION INDUSTRY TRENDS 3 In line with broader Australian demographic trends, the membership of superannuation funds is ageing. This means the proportion of fund members drawing an income stream from their superannuation is increasing and the proportion in the accumulation phase is falling. One of the obvious consequences of the rapid growth in the number of pension members is the related increase in the value of pension payments. The value of pension payments as a proportion of total payments has increased significantly, from approximately 20 percent in e 2001 to approximately half the total superannuation payments by e The tax advantages associated with superannuation and the compulsory nature of the Superannuation Guarantee have underpinned the growth of assets in the Australian superannuation system. The continued inflow of contributions has offset some of the decline in the value of assets following the onset of the global financial crisis in Contributions are expected to increase for some time, reflecting the federal government s decision to lift the rate of the Superannuation Guarantee from nine to twelve percent. Neverthless the extraordinary growth of SMSFs and an ageing population present a range of challenges for Australian superannuation institutions. Superannuation institutions need to review their strategy and plans if they are to grow their assets and membership over the coming decade. Relevant factors include the ageing population, the size and continuing growth of the SMSF segment, potential growth in the size of competitor institutions, and the consequences of the upcoming Stronger Super reforms. Specifically, superannuation institutions should consider several initiatives. Review the completeness and competitiveness of their offerings, particularly their retirement income stream solutions and the level of their fees. Fees will be one of the few points of differentiation for superannuation institutions intending to offer a MySuper product under the Stronger Super reforms. Reviews could usefully include the performance of outsourced service providers such as administrators and custodians. Activity based costing analysis, process mapping, benchmarking and diagnostic testing are other ways to quantify the cost and value of services and the benefits they provide to members. Consider alternatives to organic growth, such as merging with other superannuation institutions with complimentary member demographics and strategic or operational synergies. Of course, mergers can be a challenge because of the nature of the relationships between regulated superannuation funds and their members. Superannuation institutions contemplating a merger should consider their particular circumstances, the risks and material benefits to members that may be realised by merging and the challenges faced by superannuation institutions that, unless addressed early, can cause a merger to fail. Formulate a strategy and transition plan in contemplation of the upcoming Stronger Super reforms. In particular, superannuation institutions need to consider their target operating model and aspects of the reforms such as auto-consolidation that can affect assets under management of superannuation institutions with large numbers of inactive members. Consider, too, how the competitive landscape may change as a consequence of the Stronger Super reforms. Superannuation institutions with unfavourable demographics, that fail to develop appropriate income stream solutions for retiring members, or that fail to adapt to competitive pressures from SMSFs and other more operationally efficient superannuation institutions, face the prospect of negative funds flow, diminishing assets and terminal decline.

6 4 EVOLVING SUPERANNUATION INDUSTRY TRENDS NOVEMBER 2012 Overview of the superannuation industry In the decade to e 2012, assets in the Australian superannuation industry grew by approximately 10.5 percent per annum, increasing from approximately $500 billion to $1.4 trillion. Figure 1: Total superannuation assets A$ Billion 2,000 1,800 1,600 1,400 1,200 1, Total Assets (exc. cumulative contributions since e 2007) Total Assets Forecast Assets (KPMG) Source: APRA Statistics Annual Superannuation Bulletin e 2011 and APRA Statistics Quarterly Superannuation Performance e 2012 The tax advantages associated with superannuation and the compulsory nature of the Superannuation Guarantee have underpinned the growth of assets in the superannuation industry. Continued inflows of contributions have offset some of the decline in the value of superannuation assets following the onset of the global financial crisis. As depicted in Figure 1, without the strong contribution flows recorded in the four years to e 2011 (approximately $430 billion), the total value of superannuation assets would have been approximately $900 billion at e 2011 instead of $1.3 trillion. Arguably, total superannuation assets would have been even lower today. Superannuation institutions represent an increasingly important component of the Australian financial landscape. As we can observe in Table 1, superannuation s share of total financial institution assets has grown primarily at the expense of registered financial corporations, life offices and managed funds.

7 NOVEMBER EVOLVING SUPERANNUATION INDUSTRY TRENDS 5 Table 1: Share of total financial institution assets ADIs RFCs Life Insurance Superannuation Other managed funds General insurance Securitisation vehicles % 9% 9% 15% 9% 4% 5% % 6% 5% 18% 8% 3% 5% % 5% 4% 17% 7% 3% 4% % 4% 4% 19% 7% 3% 3% % 4% 4% 21% 6% 3% 3% % 3% 4% 21% 5% 3% 3% Source: B1 Assets of Financial Institutions, Reserve Bank of Australia, October 2012 Figure 2: Geographical distribution of retirement fund assets % Other OECD Countries Switzerland Canada Netherlands Australia Japan United Kingdom United States Despite the financial market turmoil following the onset of the financial crisis in 2007, superannuation institutions share of financial institution assets continued to increase, reaching $1 trillion by e 2012 (excluding SMSFs). Figure 2 depicts how the level of retirement fund (i.e. superannuation) assets in Australia grew faster than in any other Organisation for Economic Cooperation and Development (OECD) country in the decade to e Source: OECD Global Pension Statistics Database

8 6 EVOLVING SUPERANNUATION INDUSTRY TRENDS NOVEMBER 2012 By e 2011, Australia had overtaken the Netherlands and Canada to have the fourth largest pool of retirement fund assets in the OECD, just behind Japan and the UK. The United States continues to hold the largest share of retirement fund assets in the OECD by far. However, in the decade to e 2011, retirement fund assets in the United States as a share of total OECD assets decreased from approximately 67 to 53 percent. To a degree, this trend is consistent with a broader shift in economic prosperity away from mature developed economies to faster growing economies within the OECD. One feature that many of the largest OECD retirement systems have in common, with the exception of Australia and the United States, is the predominance of defined benefit plans. Australia is the obvious outlier, with approximately 90 percent of retirement fund assets held in defined contribution plans, followed by the United States, with approximately 40 percent of assets in defined contribution plans 1. The lack of mandated minimum contributions to retirement plans for individuals in the United States, combined with the large proportion of defined contribution plans (where employer sponsors have little or no incentive to contribute on behalf of employees), may have contributed to the decreased share of retirement fund assets in the United States as a share of total OECD assets. Fund assets in the US have also decreased as a percentage of GDP in recent years. 1 Source: OECD Global Pension Statistics Database Despite the strong growth in superannuation fund assets, the level of retirement savings in Australia is not keeping pace with overall economic prosperity. In the past five years, superannuation fund assets declined from approximately 110 percent of GDP to approximately 93 percent. This may be partly due to the asset allocation of Australian superannuation institutions, which typically have more invested in equities (compared to retirement funds overseas) and the relative underperformance of equities since In contrast, over the past five years retirement savings outpaced GDP growth in the UK, Japan and Canada. Figure 3: Retirement fund assets as a percentage of GDP United States United Kingdom Japan Australia Netherlands Canada Switzerland Weighted average Source: OECD Global Pension Statistics Database 2012 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. All rights reserved. The KPMG name, logo and cutting through complexity are registered trademarks or trademarks of KPMG International Cooperative ( KPMG International ). Liability limited by a scheme approved under Professional Standards Legislation.

9 NOVEMBER EVOLVING SUPERANNUATION INDUSTRY TRENDS 7 By e 2011, Australia had overtaken the Netherlands and Canada to have the fourth largest pool of retirement fund assets in the OECD, just behind Japan and the UK.

10 8 EVOLVING SUPERANNUATION INDUSTRY TRENDS NOVEMBER 2012 Segmentation The Australian superannuation industry can be segmented into five categories. Industry funds are regulated superannuation entities that have historically provided for employees working in the same industry or group of related industries. Many industry funds are now public offer funds and offer membership to the general public. Corporate funds are regulated superannuation entities established for the benefit of employees of a particular entity or a group of related entities with joint member and employer control. Public sector funds are superannuation entities that provide benefits largely for government employees or employees of statutory authorities, or are schemes established by a commonwealth, state or territory law. Benefits payments and contributions for public sector funds include both funded and unfunded amounts from state and commonwealth governments. Retail funds are superannuation entities that offer superannuation products to the public on a commercial basis. All Eligible Rollover Funds (ERFs) and multimember Approved Deposit Funds (ADFs) are classified as retail funds for the purposes of this publication. Small funds, predominantly selfmanaged super funds regulated by the Australian Taxation Office that have less than five members, all of whom are trustees or directors of the corporate trustee. No fund member can be an employee of another member unless they are related. Figure 4: Assets by type of fund as a percentage of total superannuation assets % Industry Corporate Public sector Retail Small Source: APRA Statistics Annual Superannuation Bulletin e 2011 and APRA Statistics Quarterly Superannuation Performance e 2012

11 NOVEMBER EVOLVING SUPERANNUATION INDUSTRY TRENDS 9 The distribution of assets by segment, as a percentage of total assets held within the Australian superannuation system, has changed significantly over time. In the decade to e 2012, the small funds segment (predominantly SMSFs) has overtaken the public sector and retail funds segments to become the single largest segment in the industry. Nearly one third of all superannuation assets now reside in SMSFs. The industry funds segment is the only other segment that acquired a greater share of superannuation assets over the same period, growing from approximately 14 percent to 20 percent of total superannuation assets in the decade to e The number of SMSF members doubled over the decade to e 2011, whereas the assets in that segment quadrupled. This suggests that a disproportionately high share of contributions and rollovers have been directed to SMSFs over the decade. Consequently, as indicated in Table 2, SMSFs now have by far the highest average balance per member account compared to the other segments and over the past five years, the average balance per member has grown faster than any other segment. One explanation for the significant growth in SMSF assets may be the influx of contributions in the year ending e 2007 when, in response to the Simpler Super reforms and the availability of a $1 million transitional non-concessional contribution cap, SMSF assets increased by approximately 50 percent compared to an increase of approximately 30 percent for other superannuation institutions. Table 2: Average account balance per member Average member account balance Corporate Industry Public Sector In fact, the share of total contributions received by SMSFs increased to 41 percent of total contributions in that year to e The share of total contributions received by SMSFs has subsided somewhat since e However, on average the self-managed super funds segment still receives approximately one quarter of all employer and personal contributions. Retail SMSF 2006 $86,281 $15,109 $52,819 $19,967 $343, $98,493 $21,895 $62,456 $24,546 $506,499 Compound Avg. Annual Growth 2.7% 7.7% 3.4% 4.2% 8.1% Source: APRA Statistics - Annual Superannuation Bulletin e 2011 and ATO Self-Managed Super Fund Statistical Report - e 2012 While some of the asset growth of the SMSF segment can be attributed to the segment s disproportionately high share of total superannuation contributions in 2007, the primary driver of growth is the disproportionately high value of assets per member that have been transferred (i.e. rolled over) from superannuation institutions to SMSFs since choice of fund was introduced in July Figure 5: Share of employer and personal contributions % SMSFs Institutions Source: APRA Statistics Annual Superannuation Bulletin e 2011 and ATO Self-Managed Super Fund Statistical Report e 2012

12 10 EVOLVING SUPERANNUATION INDUSTRY TRENDS NOVEMBER 2012 Figure 6: Rollovers to self-managed superannuation funds Inward Rollovers to SMSFs A$ Million 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2, Source: ATO Self-Managed Super Fund Statistical Report e 2012 Figure 6 shows that there has been a sustained and significant increase in the value of rollovers to SMSFs since the introduction of choice of fund in Australia with a year on year increase recorded in four of the five years to e On average, in the four-year period to e 2011, about 24 cents of every dollar transferred out of a superannuation institution was directed to an SMSF. The Australian Tax Office (ATO), in its role as regulator of SMSFs, regularly conducts a survey of new SMSF trustees. In past surveys, most respondents to the ATO new trustee questionnaire indicated that gaining control of their retirement savings was their most powerful motivation for starting an SMSF. More than half of the respondents also believed that their SMSF could outperform their previous institutional superannuation fund while a third of the trustees included an effort to save on fees as another reason for establishing their own funds.

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14 12 EVOLVING SUPERANNUATION INDUSTRY TRENDS NOVEMBER 2012 Membership demographics Similar to the general population, superannuation membership in Australia is rapidly ageing. Indeed, the number of individuals who reached preservation age (i.e. age 55 or above) increased by 67 percent in the decade to e Figure 7: Change in estimated resident population Nominal Change 10 Years to e 2011 % Age Source: ABS TABLE 59. Estimated Resident Population By Single Year Of Age, Australia At only 32 percent, the nominal increase in the estimated resident population aged 25 to 54 was much less over the same period. Specifically in relation to superannuation membership, Figure 8 illustrates that, for the top 200 Australian superannuation institutions (measured by assets under management), the number of members converting from the accumulation phase to the pension (i.e. income stream) phase has grown much faster than the annual growth in accumulation membership. Since e 2004 the number of pension members has more than doubled whereas the number of accumulation members has hardly increased at all over the same period. Since e 2009 the number of accumulation members has actually started to decline. Some of the increase in the number of pension members may be due to the popularity of the availability of the transition-to-retirement pensions introduced in July 2005.

15 NOVEMBER EVOLVING SUPERANNUATION INDUSTRY TRENDS 13 Figure 8: Accumulation vs pension membership growth Nominal Change Since e 2004 % Accumulation Pension Source: APRA Statistics - Superannuation Fund-level Profiles and Financial Performance e 2011 Figure 9: Lump sum vs pension payments A$ Million 70,000 60,000 50,000 40,000 30,000 20,000 10, Lump Sum 03 Pension Source: APRA Statistics Annual Superannuation Bulletin e However, reaching preservation age is one of the conditions that must be satisfied to commence a transition-toretirement pension. As such, the increase in the number of transition-to-retirement pension members is in itself also partly a function of the ageing population. One of the obvious consequences of the rapid growth in the number of pension members is the related increase in pension payments in recent years. The historical trend of increases in the value of pension payments has been sustained throughout the decade with a year on year increase recorded in nine of the 10 years to e Notably, the value of pension payments as a proportion of total payments has also increased significantly, from approximately 20 percent in e 2001 to approximately half the total of superannuation payments by e The combination of the growth in the number of pension members (and related increase in pension payments) and recent declines in the number of accumulation members (and related decrease in contributions), coupled with recent financial market turmoil, is forcing superannuation funds to focus greater attention on managing liquidity and cash flow. Over the medium to long term, the superannuation regulations structurally reinforce further growth of pension payments, with a 25 percent reduction in the existing superannuation pension drawdown relief in 2011/12 and no further relief in 2013/14. Also, as the population ages, and more superannuation members enter their 70s and 80s, they will have to draw a higher minimum percentage of their pension account balance as an income stream.

16 14 EVOLVING SUPERANNUATION INDUSTRY TRENDS NOVEMBER 2012 Consolidation and scale The figures reveal a pronounced and persistent trend towards consolidation of superannuation institutions in Australia. Table 3: Number of funds by type Actual Forecast Corporate 2, Industry Public Sector Retail SMSF 226, , , ,620 Source: APRA Statistics - Annual Superannuation Bulletin e 2011 and APRA Statistics - Quarterly Superannuation Performance e 2012 As a consequence of the trend towards consolidation and the resilience of contributions into superannuation, the average size of superannuation institutions has increased significantly over time. As shown in Figure 10, despite the financial market turmoil of recent years, the average size of superannuation institutions (measured by assets) increased significantly during the decade to e 2012, reaching $2.6 billion by the end of the period. It is a widely held belief that greater scale generates better outcomes (measured by lower total costs) for superannuation fund members. As superannuation funds increase in size (in terms of assets) trustees should be able to exploit economies of scale and thereby reduce their total costs (i.e. operating and investment expenses) per member. However, the growth in the average size of superannuation funds has historically yielded poor results in terms of reducing total costs per member (measured in dollars).

17 NOVEMBER EVOLVING SUPERANNUATION INDUSTRY TRENDS 15 Figure 10: Superannuation fund average size A$ Million 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, Actual Forecast (KPMG) Source: APRA Statistics Annual Superannuation Bulletin e 2011 and APRA Statistics Quarterly Superannuation Performance e 2012 Figure 11: Total costs per member vs average size Total expenses per member A$ Fund average size $ Million 2,400 2,200 2,000 1,800 1,600 1,400 1,200 1, Figure 11 indicates that in the past five years, both the average size of superannuation entities and total costs per member increased. Fund average size almost quadrupled over the period and total costs per member increased by approximately 6.6 percent per annum. Only in the year to e 2009 did total costs per member actually decrease, followed by further increases in the following two years. Neither the total costs per member nor fund average size in Figure 11 have been adjusted for inflation. However, given that annual inflation was subdued during the relevant period (approximately 2.9 percent per annum), total costs per member have grown 3.7 percent per annum in real terms. The inability of superannuation funds to reduce costs per member over the five year period suggests that achieving greater scale does not necessarily result in an immediate reduction in total costs per member. This failure could reflect the manner in which superannuation funds are charging fees to members. Total expenses per member Average size Source: APRA Statistics Annual Superannuation Bulletin e 2011 and APRA Statistics Quarterly Superannuation Performance e KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. All rights reserved. The KPMG name, logo and cutting through complexity are registered trademarks or trademarks of KPMG International Cooperative ( KPMG

18 16 EVOLVING SUPERANNUATION INDUSTRY TRENDS NOVEMBER 2012 Figure 12: Average member balance and expenses Average balance per member A$ 30,000 29,000 28,000 27,000 26,000 25,000 24,000 23,000 22,000 21,000 20, Average balance per member Total Expenses per member / Average balance per member Expenses Ratio % By charging asset based fees (instead of flat dollar fees) for investment management and administration expenses, superannuation funds have sustained a high average member expense ratio (upwards of 0.70 percent per annum) despite the average member balance increasing from approximately $23,000 to $29,000 in the five years to e The inability to reduce total costs per member and the member expense ratio over the five year period to e 2011 may be due partly to enhancements in the range and quality of services offered to members by superannuation institutions. These enhancements represent value to members, but their cost may have offset other scale-related cost reductions. Additionally the costs of adapting to significant regulatory change during this period may have negatively influenced the overall cost structure for superannuation institutions. Another possible explanation is the delay between fund consolidation and the realisation of the benefits of greater scale. For example, the lower total costs per member achieved in the year to e 2009 may reflect the consolidation that occurred in the two preceding years when fund average size almost doubled. Furthermore, to the extent that the superannuation industry is able to continue to reduce lost accounts or facilitate members consolidating multiple accounts, the reduction in the number of dormant accounts may also affect the averages. The upcoming Stronger Super reforms, particularly MySuper (which effectively standardises default superannuation arrangements), will focus attention on the ability of funds to demonstrate a reduction in operating costs per member, particularly following a merger.

19 NOVEMBER EVOLVING SUPERANNUATION INDUSTRY TRENDS 17 Conclusion Despite recent financial market turmoil, the tax advantages associated with superannuation and the compulsory nature of the Superannuation Guarantee have underpinned the growth of the Australian superannuation industry. Continued contribution inflows have offset some of the decline in the value of assets following the onset of the financial crisis in Assets in the Australian superannuation system grew by approximately 10.5 percent per annum in the decade to e 2012, increasing from approximately $500 billion to $1.4 trillion. This growth trend is expected to continue provided that any future tax reforms do not make superannuation less attractive as a retirement savings vehicle. Growth of total superannuation assets may accelerate further if financial markets continue to recover and as the rate of the Superannuation Guarantee increases from 9 to 12 percent. However, the growth of the SMSF segment and the ageing Australian population present a range of challenges for Australian superannuation institutions in the coming decade. The disproportionately high value of assets per member that are typically transferred from superannuation institutions to SMSFs in combination with increasing pension payments and fewer members in the accumulation phase pose a significant risk to superannuation institutions that fail to recognise, adapt and respond to these challenges. Superannuation institutions with unfavourable member demographics, that fail to develop appropriate income stream solutions for retiring members, and that fail to adapt to competitive pressures from SMSFs and other more operationally efficient superannuation institutions, face the prospect of negative funds flow, diminishing assets and terminal decline. Compared to other institutions that respond adequately to these challenges and are therefore able to grow either organically or by merging, institutions that fail to respond effectively will face cost disadvantages as their asset growth stalls and then begins to decline. In an increasingly competitive environment, this will weaken their ability to sustain and attract assets and contributions. Similarly, as their assets diminish, superannuation institutions operating costs per member will continue to increase, thereby perpetuating a vicious cycle, accelerating the transfer of benefits by members to SMSFs (perceived by some to be a low cost alternative to superannuation institutions), or larger more operationally efficient (and therefore, lower cost) superannuation institutions. With most respondents to the ATO new trustee questionnaires indicating that gaining control of their superannuation assets is their most powerful motivation for starting a SMSF and a third of the trustees stating that attempting to save on fees as another reason for establishing an SMSF, superannuation institutions must offer more engaging Choice features and become more cost competitive if they are to continue to attract and retain members assets and contributions. Importantly, under the MySuper regime, where the cost of providing Choice features and benefits cannot be cross-subsidised and paid for by disengaged default MySuper members, one of the few options remaining for superannuation institutions with diminishing assets will be to attempt to attract and retain members assets and contributions by becoming more cost competitive and by reducing total costs per member. This would allow them to offer both MySuper and Choice to their members at lower price points. Achieving this objective might be achievable either through an increased emphasis on operational efficiency (i.e. intensifying resource use, removing operational waste and reconfiguring processes to generate value), or by merging with larger, more operationally efficient superannuation institutions with more favourable member demographics KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. All rights reserved. The KPMG name, logo and cutting through complexity are registered trademarks or trademarks of KPMG International Cooperative ( KPMG

20 Contact us: Sean Hill National Superannuation Leader seanhill@kpmg.com.au Guy McAliece Partner gmcaliece@kpmg.com.au Wayne Hirt Partner whirt@kpmg.com.au KPMG Superannuation Services Pty Limited ABN , Australian Financial Services Licence No The information contained in this document is of a general nature. It has been prepared to provide you with information only and does not take into account your objectives, financial situation or needs. It does not constitute, nor should it be regarded in any manner whatsoever, as advice and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. It is not intended to take the place of professional advice and you should not take action on specific issues in reliance on the information contained in this document. Before acting or relying on any information, you should consider whether it is appropriate for your circumstances having regard to your objectives, financial situation or needs and also whether or not any financial product is appropriate for you. To the extent permissible by law, KPMG Superannuation Services Pty Limited, KPMG and its associated entities shall not be liable for any errors, omissions, defects or misrepresentations in the information or for any loss or damage suffered by persons who use or rely on such information (including for reasons of negligence, negligent misstatement or otherwise KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. All rights reserved. The KPMG name, logo and cutting through complexity are registered trademarks or trademarks of KPMG International. Liability limited by a scheme approved under Professional Standards Legislation. November NSWN10313MKT.