for the year ended 30 June 2005

Transcription

1 IAG & NRMA Superannuation Plan Annual Report for the year ended 30 June 2005 Trustee: IAG & NRMA Superannuation Pty Limited ACN Telephone: (02) or ext Level 13, 388 George Street Sydney NSW 2000 IAG & NRMA SUPERANNUATION PLAN ANNUAL REPORT 2005

2 1 IAG AND NRMA SUPER IAG & NRMA Superannuation Plan Issued by the Trustee: IAG & NRMA Superannuation Pty Limited For information regarding the Plan, contact: Superannuation Administration Insurance Australia Group Services Pty Limited ABN Level George Street SYDNEY NSW 2000 ext or (02) The IAG & NRMA Superannuation Plan ( Plan ) is governed by a legal document called the Trust Deed, including a set of governing rules. The Trust Deed sets out your rights and responsibilities as a Plan member, and the rights and responsibilities of your Employer and the Trustee. If there is any inconsistency between the Trust Deed and this Annual Report, the Trust Deed will be the final authority. In this report, a reference to your Employer means any one of the following companies as appropriate: Insurance Australia Group Limited and its subsidiaries (IAG) National Roads and Motorists Association Limited and its related body corporate (NRMA) In this report, a reference to the Plan is a reference to the sub-plan of your Employer. There are two sub-plans, namely: The IAG sub-plan for employees and officers of companies in the Insurance Australia Group, and The NRMA sub-plan for employees and officers of National Roads and Motorists Association Limited and its related bodies corporate. This annual report relates to membership of the Plan. You are registered in the sub-plan relevant to your Employer. Where the features of the sub-plans are different, those differences are disclosed in this annual report or in the Plan s Product Disclosure Statement. Generally, you belong to the accumulation section of the Plan if you joined your Employer after 1 October 1998, or if you have elected to transfer to this section. Otherwise, you belong to the defined benefits section (which has been closed to new members since 1 October 1998). Some members who transferred in from the SGIC Staff Superannuation Fund, the RACV Superannuation Fund, the CGU Superannuation Fund or the CGU-VACC Pension Fund are also defined benefit members. There are separate sections in this booklet for investment performance for accumulation members and defined benefit members. 1 IAG AND NRMA SUPER

3 If you need more information about the Plan Contact the Trustee or Superannuation Administration at the above address. There is no charge for this additional information. Be aware that the Trustee cannot provide you with any financial advice. For information and advice regarding superannuation generally, the selection of an investment option(s) and insurance options, you should speak to a licensed financial adviser. Additional information available on request from Superannuation Administration includes: the Trust Deed and Rules the Group Life Insurance policy and details of death, TPD and salary continuance benefits under the Plan the Product Disclosure Statement for accumulation members Member booklet for defined benefit members extracts from actuarial reports the latest audited Plan accounts the Plan s Privacy Policy Statement the rules covering the appointment and removal of member-representative Trustee Directors, and the Plan s inquiries and complaints procedures. The Plan has a process in place for dealing with enquiries and complaints. Additional dispute resolution is available to members through the Superannuation Complaints Tribunal. For more information, see page 36. WORKING FOR YOUR FUTURE 2

4 3 CONTENTS Contents A Message from the Trustee 4 The Plan at a glance 5 Your Plan s investment performance 7 Investment environment for year ended 30 June Investment environment in more detail 7 Investment strategy and objectives 9 How the Plan s assets are managed 9 Large assets of the Plan 10 Use of derivatives 10 Investment information for accumulation members 11 Recent investment returns 11 Your investment options in detail 12 Shares 12 Growth 13 Balanced 15 Conservative 17 Measuring performance 19 Investment information for defined benefit members 20 Plan information for all members 22 The Plan s financial position 22 Sub-plan reporting 24 How your Plan is managed 25 What s happening in super 33 More information 36 Questions? 37 3 CONTENTS

5 A message from the Trustee Dear member Investment returns for 2004/2005 The financial year was another good year for investors, with especially strong returns provided by the Australian share and property markets. Trustee initiatives The Trustee reviewed several aspects of the operation of the Plan during the year. These included the following: The Trustee appointed Colonial Mutual Life Assurance Society Limited (CommInsure) as the Plan s insurer in respect of the insured benefit component for the death and total and permanent disablement benefits. The Plan s salary continuance benefits are still provided on a self insurance basis. New premium rates for all insured benefits were introduced. Two new investment options were introduced. Two new investment managers were appointed to manage a portion of the Australian equity portfolio. Government legislation Choice of fund legislation took effect from 1 July The Trustee understands that your employer has given you information about superannuation choice. By 1 July 2006, all superannuation trustees must obtain a superannuation licence and all superannuation funds must be registered. The Trustee has recently prepared the licence and registration application and lodged these with the Australian Prudential Regulation Authority. Any questions? If you have any questions about your benefits in the Plan, please call me on ext or (02) You can also contact any employee of Superannuation Administration (see the last page for contact details) or any of the Trustee directors (see page 25). Joe Janssen Manager Superannuation On behalf of IAG & NRMA Superannuation Pty Limited A MESSAGE FROM THE TRUSTEE 4

6 5 SUMMARY The Plan at a glance This section provides a brief summary of the operations of the Plan during the year. Further details are set out later in the report. Plan facts and figures Plan membership Accumulation members 10,406 Defined benefit members 1,149 (including 210 retired pensioners) Plan assets as at 30 June 2005 were in excess of $816 million. Your member representative Trustee directors Elections were held during the year for member elected directors. The successful candidates in the elections were Patrick Farrell, Joe Gonzalez, Jon Street and Peter Swan. Government regulations The surcharge tax was abolished with effect from 1 July 2005, applying to contributions made after this date. Choice of fund legislation became effective from 1 July Investment returns The following is a summary of the investment returns for the year as well as the average returns over the last five years. Accumulation members Investment Option Annual return* for the year Compound average annual ended 30 June 2005 (%p.a.) rate of return over the last 5 years (% p.a.) Shares 16.9% 4.8% Growth 12.4% 5.0% Balanced 11.3% 5.7% Conservative 7.8% 6.5% *This return is the effective rate of net return; which is the actual rate of return after taxes and investment expenses. However, you should note that for the years ending 30 June 2004 and 2005, these taxes and expenses were only partially deducted due to an unintentional oversight. As a result, the total interest credited over these two years, for each option, was approximately 1.3% higher than it would have been if the taxes and expenses had been fully deducted. 5 SUMMARY

7 Defined benefit members Annual return for the year ended 30 June 2005 (% p.a.) Members who joined the plan before 2000 Average annul rate of return over the last 5 years (% p.a.) Credited to member accounts Earned on plan assets Members who transferred from one of the CGU funds Credited to member accounts 12.4 n/a The investment market continued to perform well, largely due to the strong performance in the following sectors: Australian shares Listed Property Trusts. As at 1 July 2005, the Trustee introduced two extra investment options. They are: Australian Share Option Cash Option. For more information about these new investment options, see the May 2005 edition of SuperNEWS or contact Superannuation Administration. Investment managers The assets of the Plan are managed by IAG Asset management Limited ABN (IAGAM). However, in consultation with the Trustee, IAGAM may appoint other investment managers to manage part of the Plan s assets. Following a detailed review of its investment managers, IAGAM, in consultation with the Trustee, appointed the following managers to manage part of the Australian equity portfolio: Lazard Asset Management Pacific Co Orion Asset Management Limited. Separately, the Trustee redeemed all investments it held with: Maple-Brown Abbott Limited Credit Suisse Asset Management Australia Limited AMP Capital Investors Limited. WORKING FOR YOUR FUTURE 6

8 7 INVESTMENT PERFORMANCE Your Plan s investment performance This section applies to all members and potential members of the Plan. Your investment returns and the investment environment for the 12 months to 30 June Domestic and overseas share markets provided positive returns for the year to 30 June The local market performed very strongly, led by large gains in resource stocks. Returns from unhedged overseas shares were flat as a result of a rise in the Australian dollar over the year. The major influences on the global economy and markets were: higher oil and commodity prices; a return of Governments in Australia and the US with increased majorities; and the US Federal Reserve raising the Fed Funds Rate from 1.25% to 3.25% over the year. In Australia, economic growth softened as the housing market corrected and the Reserve Bank of Australia raised the cash rate by 0.25% to 5.5%. The financial year yielded attractive returns to superannuation funds holding diversified portfolios. Many superannuation funds had returns in the low to mid teens, as indicated by the Mercer Pooled Fund Survey balanced fund median return of 13.0%.* *Survey returns reflect institutional investment funds and are after tax and fees. The investment environment in more detail Australian shares S&P/ASX 200 Accumulation Index (up 26.0% for 12 months to 30 June 2005) The Australian market rose in 10 out of the 12 months of the financial year and has risen for nine consecutive quarters. The S&P/ASX 200 Accumulation Index ended the year up 26.0%, making Australian shares the strongest performing sector over the financial year. This is the second successive year that Australian shares have returned in excess of 20%. The performance was supported by: an exceptionally strong company earnings environment (particularly in the energy and resources sectors); a relatively neutral stance on monetary policy by the Reserve Bank of Australia; a tendency towards lower Australian bond yields; a supportive Australian Federal budget; and continued overseas and domestic growth. 7 INVESTMENT PERFORMANCE

9 Overseas shares MSCI World (ex Australia) Unhedged Index (in A$) (up 0.1% for 12 months to 30 June 2005) Over the year, overseas shares returned 13.3% in local currency terms. However, the appreciation of the Australian dollar against other major currencies detracted from these gains, with unhedged overseas shares delivering a mere 0.1% for the financial year. The Australian dollar appreciated from US cents to end the year at US cents. Overseas shares were supported by improving company earnings and the relatively measured removal of an overly accommodative US monetary policy by the US Federal Reserve. The significant increase in the price of oil, which rose towards US 60 dollars by year end, was a continuing concern for markets. Property S&P/ASX 200 Property Trusts Accumulation sub-index (up 18.1% for 12 months to 30 June 2005) Listed property recorded a strong return of 18.1% over the year. This was largely driven by merger activity in the first half of the year, offset by a decline in returns in the March quarter and a rebound in the June quarter. The major contributing factors were: the high level of corporate activity in the sector; lower bond yields; and generally buoyant share market conditions. Australian fixed income UBS Australian Composite Bond Index (up 7.8% for 12 months to 30 June 2005) Overseas and Australian fixed income recorded higher returns in the past year compared to the previous five years. This was as a result of long-term government bond yields around the world falling to historically low levels. This fall reflected investors increasing concerns over the impact of higher oil prices on the world economy and the slowing domestic economy. As a result, the Reserve Bank of Australia made a solitary 0.25% increase in the official cash rate (to 5.50% per annum) in March Australian cash UBS Australian Bank Bill Index (up 5.6% for 12 months to 30 June 2005) Australian cash and short duration investments returned 5.6% for the year, a return higher than normal above the average RBA cash rate due to bank bill markets anticipating rises in Reserve Bank of Australia official cash rates. Investment performance comparison The Plan s investment performance is regularly monitored against that of its peers. In the Intech Market-linked Pooled Funds Performance Survey as at 30 June 2005, the Plan s five year average rate of return (before the deduction of fees and taxes) for the Growth Option was 5.3%, against the peer group average of 6.2%. The investment policy for the Growth Option is similar to that used historically by the Plan. Market comparisons for the other investment options are not provided by Intech. WORKING FOR YOUR FUTURE 8

10 9 INVESTMENT MANAGEMENT Investment strategy and objectives Although the Plan offers member investment choice for accumulation members, the Trustee retains overall responsibility for the investment of the assets of the various options in line with their specific investment objectives. However, accumulation members who exercise choice are responsible for choosing the investment option/s that suit their individual needs and preferences. How Plan assets are managed The assets of the Plan are managed by IAG Asset Management Limited ABN (IAGAM). It may invest in securities such as Australian and overseas shares, listed property trusts, fixed interest securities, cash and short-term securities or any other investments authorised by the Trustee. This can be done directly or through trusts. Most of the Plan s assets invested in Australia are managed by investment professionals of IAGAM. As at 30 June 2005, approximately 27% of the Australian company share portfolio was managed by: Lazard Asset Management Pacific Company ABN ; and Orion Asset Management Limited ABN These two external managers were appointed during the year to replace: Maple-Brown Abbott Limited ABN ; and Credit Suisse Asset Management Australia Limited ABN The small portion of the property investment portfolio, that was managed by AMP Capital Investors Limited ABN , was redeemed during the year. Fixed interest securities and cash are invested in a fixed interest and cash management trust respectively, which are both managed by IAGAM. Overseas investments are managed within the World Equity Trust established by IAGAM. The World Equity Trust uses the investment services of specialist external managers. These managers are: Wellington Management Company (an actively managed portfolio) State Street Global Index Plus Fund (which invests in line with the World Index) Alliance Capital Australia Limited (an active manager appointed in September 2003). The World Equity Trust investment structure enables the Plan to diversify its international investments by using the expertise of a number of managers with different strategies. This arrangement provides greater diversity and flexibility for entry into and exit from the international markets. The overseas investments of the Plan are invested on an unhedged basis. The Plan has a small private equity portfolio that is managed by Horsley Bridge Partners. This portfolio forms part of the allocation to overseas shares. IAGAM monitors the activities and performance of all the external managers on behalf of the Trustee and reports to the Trustee on a quarterly basis. 9 INVESTMENT MANAGEMENT

11 Large assets of the Plan Fixed interest securities guaranteed by the Commonwealth or State Governments as at 30 June 2005 were the only investments in excess of 5% of the Plan assets. The World Equity Trust, Fixed Interest Trust and Cash Management Trust each hold more than 5% of the Plan s assets as at 30 June Use of derivatives Derivatives are special contracts e.g. futures and forward exchange rate agreements which can be used to manage the risk of changes in the future value of investments. The investment manager is permitted to use derivatives in the management of the Plan assets. These instruments are typically used for the following purposes: hedging; that is to protect against adverse changes in the market value of assets to obtain prices that may not be available if assets are bought directly to reduce the costs of buying and selling assets directly to change the term of a fixed interest security to manage cash flows efficiently to manage asset weighting for the different asset classes. Derivatives may not be used for speculative purposes. The Plan held derivatives during the year ended 30 June 2005 in respect of its Australian shares, overseas shares and fixed interest investments. The Plan s exposure to derivatives is limited to 20% of the market value of the Plan. Within each asset class, exposure to derivatives is limited to 20% of the market value of the asset class. The investment manager reports to the Trustee regularly on the use of derivatives. The derivative charge ratio of the Plan did not exceed 5% at any time during the year. The derivative charge ratio is the percentage of the total market value of assets of the Plan (excluding cash) that the Trustee has charged as security for derivative investments made by the Trustee. WORKING FOR YOUR FUTURE 10

12 11 INVESTMENT INFORMATION Investment information for accumulation members Information in this section applies to accumulation members of both sub-plans. Recent investment returns The following table shows the relevant earning rates for each investment option for the year ended 30 June 2005 and the average rate of net return for the past five years. The annual effective rate of net earnings is the actual earning rate less associated taxes and investment expenses. However, you should note that for the years ending 30 June 2004 and 2005, these taxes and expenses were only partially deducted due to an unintentional oversight. As a result, the total interest credited over these two years, for each option, was approximately 1.3% higher than it would have been if the taxes and expenses had been fully deducted. Investment Effective rate of net earnings Compound average rate of option (% p.a.) net return over the past five years (% p.a.) Year ended 30 June Shares Growth Balanced Conservative Investment earnings for an investment option may be positive or negative. The Trustee holds units in each investment option. The value of the units depends on the performance of your chosen option/s. The price of these units will go up and down as investment markets shift, affecting the value of your units and consequently the value of your investment. As you can see from the comparison table above, the market has been volatile, displaying a sharp recovery after the poor performances in 2002 and It is important to be aware that investment returns from this short time frame may not be indicative of the returns that may be received over the duration of your retirement planning. Time frames of five years or longer will typically provide a more accurate indication of the overall long-term performance of an investment option. It is important to understand that past performance, for each portfolio option, should not be relied upon as indicative of future performance and does not guarantee such performance. Each option bears a different level of risk, depending on the mix of asset classes that make up the portfolio. More information about the associated risks and allocation of asset classes for each option are detailed on the following pages of this booklet. 11 INVESTMENT INFORMATION

13 Your investment options in detail You choose how your super is invested. Choosing an investment option that suits your investment needs and timeframe could make a material difference to the size of your final account balance. Each of the Plan s options has a specific investment objective and strategy set by the Trustee. Each option has a different risk profile and the Trustee s aim is to achieve the best possible returns relative to the level of risk associated with investing in that option. Be aware that the investment returns for any option may be positive or negative, depending on volatility of investment markets and the performance of the underlying asset classes. The performance of each asset type is measured against a benchmark set by the Trustee who reviews this performance regularly. Your future contributions must be fully invested in only one of the options. However, existing balances can be split across any number of the options in multiples of 5%, to total of 100%. You may switch your investment options at any time, with a maximum of four switches in any calendar year. You won t be charged any fees for switching your investment options. If you do not make an investment choice, your super will be invested in the Growth Option, which is the Default Option. Option 1 - Shares Investment objective: To achieve a high level of returns over the long term, by investing only in shares, which are high growth assets. Strategy: Aims to invest 65% of assets in Australian shares, and 35% in overseas shares. By sharing the asset allocation, this portfolio is not completely exposed to either Australian or overseas market forces, giving the advantage of some diversification. Level of risk - high Because shares are market driven investments which respond quickly to changes in market conditions, shares are highly volatile and investors can expect performance to show periods of significantly high growth, as well as periods of poor or even negative returns. Over a longer period of time, shares generally can be expected to produce higher returns than other asset classes. Portfolio The performance of the Shares Option is measured against a benchmark portfolio, which consists of the target asset allocation as shown below. Each asset class within the benchmark portfolio is assumed to earn investment returns based on an appropriate index as shown in the table on page 19. Target asset allocation Benchmark Ranges Australian shares 65% 55-75% Overseas shares 35% 25-45% WORKING FOR YOUR FUTURE 12

14 13 INVESTMENT OPTIONS Where the assets were invested as at 30 June 2005 The investment manager may vary the actual asset allocation at any time either up or down within the above ranges. As at 30 June 2005, the Shares Option had investment assets of $60.6 million. Recent investment returns: The annual effective rate of net return (i.e. actual investment returns less tax and expenses) for the year ended 30 June for the last five years were: Period Rate of return % Australian shares 65% Overseas shares 35% % % % % Note: The average rate of net return over the last five years is 4.8% per annum. 13 INVESTMENT OPTIONS

15 Option 2 - Growth (Default option) Investment objective: Aims to achieve a high level of growth that exceeds the return of the benchmark portfolio and high returns over the medium to long term. Strategy: Aims to invest the majority (70%), in growth assets such as Australian and overseas shares and listed property trusts, and the remaining (30%) in less volatile assets such as fixed interest and cash. Level of risk medium to high While a large portion of the assets is invested in the volatile share markets, this is partially offset by the stability of the fixed interest and cash components of the portfolio. For this reason, the Growth Option can be expected to show some fluctuation from year to year, however this fluctuation is not expected to be as great as for the Shares Option. The Growth Option is also the Default Option. This means that this option will apply to your superannuation investment if you do not choose an investment option. Accumulation balances for defined benefit members are also invested in the Growth Option. The Trustee has chosen the Growth Option as the Default Option because the Trustee views superannuation as a long-term investment. However, it s important that you individually assess your own situation and retirement planning strategy (for example, if you are near to retirement age), as the Default Option may not be appropriate for you. You are encouraged to make your own choice between the available options. Portfolio The performance of the Growth Option is measured against a benchmark portfolio, which consists of the target asset allocation shown below. Each asset class within the benchmark portfolio is assumed to earn investment returns based on an appropriate index as shown in the table on page 19. Target asset allocation Benchmark Ranges Australian shares 35% 25-45% Overseas shares 25% 15-35% Listed property trusts 10% 0-20% Fixed interest 25% 10-40% Cash 5% 0-20% The investment manager may vary the actual asset allocation at any time either up or down within the above ranges. WORKING FOR YOUR FUTURE 14

16 15 INVESTMENT OPTIONS Where the assets were invested as at 30 June 2005 As at 30 June 2005, the Growth Option had investment assets of $670.7 million. This includes the assets in respect of defined benefit members as explained on page 20. Recent investment returns: The annual effective rate of net return (i.e. actual investment returns less tax and expenses) for the year ended 30 June for the last five years were: Period Rate of return % Australian shares 34.8% Overseas shares 25.1% Listed property shares 10% Fixed interest 24.6% Cash 5.5% % % % % The average rate of net return over the last five years is 5.0% per annum. Option 3 - Balanced Investment objective: Aims to provide growth over the medium-term that exceeds the benchmark return and is relatively stable. Strategy: Aims to have 50% of the portfolio in growth assets, which participate in the higher returns expected from shares, but is cushioned from the associated high volatility by an equal allocation (50%) to defensive assets. Level of risk - medium With greater levels of diversification and reduced risk, this portfolio is not expected to experience as high a level of year-on-year volatility in investment returns as either Option 1 or Option 2. Portfolio The performance of the Balanced Option is measured against a benchmark portfolio, which consists of the target asset allocation as shown below. Each asset class within the benchmark portfolio is assumed to earn investment returns based on an appropriate index as shown in the table on page INVESTMENT OPTIONS

17 Target asset allocation Benchmark Ranges Australian shares 27.5% % Overseas shares 15% 5-25% Listed property trusts 7.5% 0-15% Fixed interest 35% 25-55% Cash 15% 0-30% The investment manager may vary the actual asset allocation at any time either up or down within the above ranges. As at 30 June 2005, the Balanced Option had investment assets of $56.6 million. Where the assets were invested as at 30 June 2005 Recent investment returns: The annual effective rate of net return (i.e. actual investment returns less tax and expenses) for the year ended 30 June for the last five years were: Period Rate of return % % % % % Australian shares 27.4% Overseas shares 15% Listed property trusts 7.6% Fixed interest 34.3% Cash 15.7% The average rate of net return over the last five years is 5.7% per annum. WORKING FOR YOUR FUTURE 16

18 17 INVESTMENT OPTIONS Option 4 - Conservative Investment objective: Aims to achieve stable investment returns in the short to medium-term that exceed the benchmark while keeping pace with the cost of living (inflation). Strategy: Invests mainly in fixed interest and cash, which are stable investments producing a more predictable return that can be expected to be lower than those of Options 1, 2 or 3 in the longer term. The growth component of this portfolio is achieved by a relatively small investment in shares and property. Level of risk medium to low Investment returns are expected to remain more stable in the short-term than the returns of Options 1, 2 or 3. Portfolio The performance of the Conservative Option is measured against a benchmark portfolio, which consists of the target asset allocation as shown below. Each asset class within the benchmark portfolio is assumed to earn investment returns based on an appropriate index as shown in the table on page 19. Target asset allocation Benchmark Ranges Australian shares 10% 0-20% Overseas shares 10% 0-20% Listed property trusts 5% 0-10% Fixed interest 45% 20-70% Cash 30% 5-55% 17 INVESTMENT OPTIONS

19 The investment manager may vary the actual asset allocation at any time either up or down within the above ranges. As at 30 June 2005, the Conservative Option had investment assets of $37.8 million. Where the assets were invested as at 30 June 2005 Recent investment returns: The annual effective rate of net return (i.e. actual investment returns less tax and expenses) for the year ended 30 June for the last five years were: Period Rate of return % % % % % Australian shares 9.8% Overseas shares 10.1% Listed property trusts 5% Fixed Interest 44.4% Cash 30.7% The average rate of net return over the last five years is 6.5% per annum. WORKING FOR YOUR FUTURE 18

20 19 MEASURING PERFORMANCE Measuring performance The investments are reviewed regularly to monitor how they are performing against investment objectives. Below are the benchmarks used by the Trustee to measure the performance of each asset class. For the asset classes the Trustee invests in, these performance benchmarks are: Asset Type Performance Benchmark Australian shares Composite Index * Overseas shares Listed property trusts Fixed Interest Cash MSCI World (ex Aust) Accumulation Index ASX 200 LPT Accumulation Index UBS Composite Bond Index (All Maturities) UBS Bank Bill Index *Part of the Australian Share portfolio is measured against the S&P/ASX 200 Accumulation Index, part against the S&P/ASX 300 Accumulation Index and part against the S&P/ASX 300 Accumulation Index (ex LPTs, ex IAG). The comparison of the investment performance of the Plan against the benchmarks is regularly reported in the newsletters distributed by the Trustee each year. 19 MEASURING PERFORMANCE

21 Investment information for defined benefit members Information in this section applies to you if you re a member of the defined benefit section. Defined benefit members who joined the Plan before 2000 Some of your benefits may be based on your account balances in the Plan. Accumulation balances of defined benefit members who joined before 2000 were credited with an earning rate of 8.5% per annum for the year ended 30 June This is equal to the average effective rate of return over the last three years. Comparison of annual effective rates of net return and declared rates The Plan s annual effective rate of net investment returns (i.e. actual investment returns less tax and expenses) and declared earning rates since 2001 are as follows: Year ened 30 June Effective rate of return (% p.a.) Declared earning rate (% p.a.) Note: Past performance is not an indication of future performance The average declared earning rate for defined benefit members over the five years to 30 June 2005 was 5.6% per annum. The average effective net rate of return for defined benefit members over the past five years was 5.0% per annum. Defined benefit members who transferred from a CGU fund For defined benefit members who transferred from the CGU Superannuation Fund or the CGU-VACC Pension Fund, the Trustee used a declared earning rate that is equal to the net investment return. As at 30 June 2005, this was 12.4%. From 1 July 2005, your declared earning rate will also be based on the average rate of return over the last three years. Further details of the investment performance, investment objectives and strategy are set out on page 13 under the Growth Option of accumulation members. WORKING FOR YOUR FUTURE 20

22 21 INVESTMENT EARNINGS Defined benefit members leaving during the year For defined benefit members leaving the Plan during the year, before a final earning rate is available, benefits are calculated using an interim earning rate. The Trustee reviews interim rates each quarter. The interim rates are partly based on the recent actual investment performance and partly on an assumed earnings rate based on the ten year Government Bond Rate (less a 10% allowance for tax) as explained below. The interim earning rate applying from 1 July 2005 is based on: the actual investment performance for the two year period from 1 July 2003 to 30 June 2005, and an assumed earnings rate for the one year to 30 June After the end of the September 2005 quarter, the Trustee re-calculates the interim rate based on: the actual investment performance for the two years and three months period to 30 September 2005, and an assumed earnings rate for the nine months to 30 June 2006 and so on for each subsequent quarter. For the year ending 30 June 2005, the interim earning rates were calculated on a similar basis. 21 INVESTMENT EARNINGS

23 Plan information for all members The Plan s financial position The actuary has advised that the Plan is in a sound financial position. After each review of the financial position of the Plan, the actuary advises the amount of contributions that all Employers need to make to the Plan. For the year ended 30 June 2005, in accordance with the actuary s advice: no employer contributions were made to the Plan on behalf of the members in the NRMA sub-plan; and employer contributions on behalf of members in the IAG sub-plan recommenced from 1 June A summary of the Plan s audited accounts for the 2004 and 2005 years is shown below. Copies of the audited accounts and the auditor s report are available by contacting Superannuation Administration see the back page for contact details. WORKING FOR YOUR FUTURE 22

24 23 FINANCIAL INFORMATION Accounts as at 30 June Statement of change in net assets ($000) ($000) Net assets at start of year 826, ,183 Plus Contributions 20,722 17,189 Transfers from other funds ,834 Investment income 53,522 36,615 Realised investment gains (losses) (2,412) 10,338 Unrealised investment gains (losses) 48,090 58,374 Total revenue 120, ,350 Less Benefits paid 121, ,183 Administration and investment fees 5,164 4,430 Contribution surcharge tax 3,137 1,950 Income tax expense 157 7,690 Total expenses 130, ,253 Net assets at end of year 816, ,280 Statement of net assets Assets Investments 830, ,570 Dividends receivable 4,966 12,138 Other 6,213 6,020 Total assets 841, ,728 Liabilities Benefits payable 15,628 8,390 Provisions for income tax 8,847 4,608 Other (including share creditors) 647 2,450 Total liabilities 25,122 15,448 Net assets at end of year 816, , FINANCIAL INFORMATION

25 Sub-Plan reporting In accordance with the Plan s Trust Deed, from 1 December 2003, the Plan has been administered as two Sub-Plans, the IAG Sub-Plan and the NRMA Sub-Plan. The following secondary sub-plan report, has been prepared for the financial year to 30 June In accordance with the Plan s trust deed, the actuary for the Plan partitioned all net assets and benefits as at 1 December IAG Sub-Plan NRMA Sub-Plan $000 $000 Net assets available to pay benefits at the beginning of the financial year 675, ,664 Contributions 19,433 1,289 Transfers from other funds Investment income 42,237 11,282 Realised and unrealised investment gains 37,996 7,685 Total revenue 99,844 20,256 Benefits paid 86,156 35,648 Administration and investment expenses 4, Contribution surcharge tax 2, Income tax expense Total expenses 93,615 36,647 Net assets at the end of the year 681, ,273 Statement of net assets Investments 693, ,944 Dividends receivable 4, Other 4,986 1,051 Total assets 702, ,840 Liabilities Benefits payable 12,618 3,010 Provisions for income tax 7,384 1,463 Other (including share creditors) Total liabilities 20,555 4,567 Net assets at end of year 681, ,273 WORKING FOR YOUR FUTURE 24

26 25 MANAGEMENT How your Plan is managed The Trustee The Plan is set up as a trust and is governed by a legal document called the Trust Deed. A Trustee company, IAG & NRMA Superannuation Pty Limited (ACN ), manages the Plan. The Trustee company has nine directors, two of whom are appointed by Insurance Australia Group Services Pty Limited; two are appointed by National Roads and Motorists Association Limited and four member representatives are elected by members of the Plan for a period of three years. Currently, there is also one independent director who is appointed by the other Trustee directors. The directors of the Trustee company as at 30 June 2005 were: Independent director Susan Ryan President Australia Institute of Superannuation Trustees Company-appointed directors Ian Brown Deputy Chief Executive Officer IAG Roger Bruce Sam Mostyn Peter Steele General Manager People and Performance - NRMA Group Executive Culture and Reputation - IAG General Manager Corporate Services and Deputy CEO - NRMA Member representative directors Patrick Farrell Head of Tactical Asset Allocation - IAGAM Joe Gonzalez Jon Street Peter Swan Head of Client Advisory Services - IAGAM Road Service Patrol NRMA Head of Compulsory Third Party - IAG Director changes during the year The term of office for member representative directors expired on 30 April As a result of the election process, Patrick Farrell replaced Pam Bardsley as a director. Joe Gonzalez, Jon Street and Peter Swan were re-appointed for a further three year term. A chance to have your say As member elected directors are elected by the members of the Plan, you get the chance to nominate and vote for representatives on the Trustee Board. The Plan has a specific set of rules applying to the appointment and removal of member elected directors and the filling of casual vacancies. 25 MANAGEMENT

27 Indemnity insurance The Trustee and its directors may be reimbursed and indemnified out of the Plan for all liabilities which they properly incur in administering the Plan as a result of an honest mistake. To protect the assets of the Plan against certain losses arising from the conduct of the Trustee and its directors and administrators, the Trustee has taken out trustee indemnity insurance cover. Trust Deed The Trust Deed may be amended from time to time. Amendments were made to the Governing Rules of the Plan in December nature and included the following changes: These amendments were mainly procedural in the power in the Rules to make amendments was modified to confirm that, in appropriate cases, particular amendments can apply from a date earlier than the date that the Trustee resolves to make the change; a number of adjustments were made to the Rules to correct some errors made when the benefit provisions covering members who transferred from the CGU Superannuation Fund and the CGU-VACC Pension Fund were incorporated in the Rules; these changes took effect from the date the original provision was included in the Rules; to clarify the operation of some provisions of the Rules (in line with the Trustee s intentions) and to remove any potential uncertainty; some of these changes took effect from the date the original provision was included in the Rules, while others applied from December 2004; and to permit an Accumulation member with an inactive account in the Plan to ask the Trustee to transfer his or her withdrawal benefit from the Plan to another facility acceptable under superannuation laws and to enable the Trustee to charge a fee to cover its administrative costs in doing so. (An inactive account in the Plan could arise where a member s employer contribution account was not credited with employer contributions for 6 months). superseded by the amendments made to implement the new choice arrangements explained below. This has since been Further amendments were made on 2 August These changes can be grouped under the following general headings. Insurance A number of changes were made as a consequence of the Trustee s decision to appoint Colonial Mutual Life Assurance Society Limited as insurer for the insured component of the death and total and permanent disablement benefits provided by the Plan. These benefits had previously been self-insured by the Plan. The changes applied from 1 July 2005 and were explained in the September 2005 issue of SuperNEWS. Choice of Fund Amendments were also made to facilitate a member exercising superannuation choice with effect from 1 July If a member exercises choice, then future employer contributions will be made to another superannuation fund selected by the member. A member can also choose to leave the Plan and transfer accrued benefits to another fund acceptable under superannuation law. If you are a defined benefit member and exercise choice, you will automatically become an accumulation member. WORKING FOR YOUR FUTURE 26

28 27 PLAN CHANGES If you exercise choice and do not transfer your accrued benefits to another fund, you become a retained member and your insured benefits are affected. This is explained in the September 2005 issue of SuperNEWS. Administration These amendments were mainly procedural in nature and included the following changes, which applied from 1 July 2005: the definition of spouse, dependants or relatives has been expanded to include a person with whom a member is in an interdependency relationship. An interdependency relationship has a particular meaning under superannuation law. Essentially, it covers people who live together in a close personal relationship under which they provide each other with financial support. to enable persons to join the Plan on special terms through an agreement with the member s employer, as long as the Trustee approves the arrangement. a minimum death and TPD benefit is provided for accumulation members (other than spouse members and members who have become retained members for more than 30 days). The new benefit scale is set out below: Your age Insured benefit up to 34 $50, $40, $34, $28, $22, $16, and over $10,000 consistent with the new insurance arrangements, where the Trustee self-insures a benefit, the Rules now enable the Trustee to specify terms upon which the self-insured benefits may be provided, or to adjust the benefit available. contributions in respect of a member made pursuant to the Government co-contribution scheme can be accepted by the Trustee and credited to the member s accumulation account. while expected to arise only rarely in practice, the Plan can also now accept contributions properly made in respect of a member by that member s employer, where that employer is not currently a participating employer of the Plan. where a death or TPD benefit is payable under the Rules, and payment is delayed more than 14 days from the date that payment ought ordinarily to have been made, then interest is payable. If the delay is due to the Insurer, however, interest is only payable if paid by the Insurer. 27 PLAN CHANGES

29 members can request a pension in place of all or part of a lump sum benefit payable from the Plan, but the Trustee has discretion whether or not to agree to the payment of a pension. to clarify the operation of some provisions of the Rules (in line with the Trustee s intentions) and to remove any potential uncertainty. to incorporate changes previously made to implement the transfer of members of the SGIO Superannuation Fund and the SGIC Staff Superannuation Fund on 13 September Further information about these changes is available by contacting Superannuation Administration on (02) or ext A copy of the Trust Deed may be inspected on request to Superannuation Administration. Concessional tax treatment In order to qualify for concessional tax rates, funds have to be classified as complying superannuation funds under the income tax laws. To be eligible, funds must report regularly to the Australian Prudential Regulation Authority (APRA) and demonstrate their compliance with superannuation laws and APRA guidelines. The Plan is classified as a complying superannuation fund and the Trustee is not aware of any matter that would cause the Plan to lose its complying status. Management assistance The Plan is administered by Superannuation Administration, which performs such functions as determining member benefits, processing and allocating contributions and ensuring all membership data is correct. Superannuation Administration contact details can be found on the last page of this report. The Plan s compliance status is monitored by Joe Janssen, Manager Superannuation. The Trustee is assisted by a number of professionals who provide advice and assistance in the administration of the Plan. These include: Actuarial and Communication Consulting Mercer Human Resource Consulting Pty Limited (Mercer) Auditor KPMG Insurer Colonial Mutual Life Assurance Society Limited (CommInsure) Investment Manager IAG Asset Management Solicitor Ebsworth & Ebsworth WORKING FOR YOUR FUTURE 28

30 29 ADMINISTRATION The Trustee reviewed the provision of the Plan s insured benefits during the year and appointed CommInsure to provide members insured death and total and permanent disablement benefits provided by the Plan. CommInsure s appointment was implemented as at 1 July Further details of this appointment were set out in the May and September 2005 editions of SuperNEWS. Unit pricing The Trustee introduced member investment choice for accumulation members of the Plan in July Member investments are administered on a unit price basis with the unit price generally being determined on a weekly basis. In conjunction with the addition of two new investment options on 1 July 2005, calculation of weekly unit prices was transferred to a new system called Hiportfolio. This is an asset management system used by over 250 financial institutions in over 30 countries. It provides a better, more sophisticated system for calculating unit prices. In the process of transferring to the new Hiportfolio system, it was noted that, due to an unintentional oversight, investment management fees and investment taxes, which ought to have been deducted before the weekly unit price was declared, were not deducted during the period from December 2003 to May This meant that unit prices during this period were higher than they ought to have been, which was generally beneficial to members. In effect, these investment management fees and investment taxes were met from the Plan s surplus assets. However, as a consequence of the transfer to the new Hiportfolio system, a reserve for future tax liability as at 30 June 2005 (about 40% of the investment tax that had not been deducted since December 2003) was required to be included in the unit price calculation. This had the effect of reducing the unit prices at 30 June The Trustee requested the Plan s actuary to undertake a detailed analysis of the impact of the inflated unit prices for the period from December 2003 to May 2005 and the consequences of the unit price adjustment at 30 June The Trustee was concerned to identify whether any members were detrimentally affected by the unit pricing error. The Plan s administrator accepted responsibility for the unit pricing error and agreed to meet the cost of this actuarial report. The actuarial report identified 1,643 members who had recently joined the Plan and who had suffered a small loss of benefit. The Trustee approved the issue of additional units to the accounts of these members equal to the amount of the loss suffered provided they had not left the Plan at the time the adjustments were made. In the case of those members who had left the Plan and had suffered a loss of $10 or more, these members will receive an additional benefit to compensate them for their loss. Because of the administrative complexity involved in compensating former members whose loss was less than $10, the Plan s administrator agreed to make a charitable donation equal to the total value of the losses of such members. Overall, the unit prices for each investment option are now about 1.3% higher than they would have been if the fees and taxes had been correctly deducted. This also means that the interest rate credited to the account balances for defined benefit members is higher, to a similar extent, than it would normally have been. In the case of members and former members of the IAG sub-plan, as the Plan s administrator is part of the IAG Group, the Trustee has agreed with IAG that the cost associated with meeting the higher unit price and compensating members and 29 ADMINISTRATION

31 former members would be borne from surplus assets attributed to the IAG subplan. In the case of members and former members of the NRMA sub-plan, a compensation payment will be credited to the surplus assets attributed to that sub-plan on a basis to be agreed between the Trustee and the Plan s administrator. Receiving your benefit When you leave your Employer, you will be asked for payment instructions for your benefit. Your superannuation is an important investment and you are encouraged to consider carefully where you want to invest it. If you leave the Plan before you reach your preservation age, part or all of your superannuation benefit will be subject to preservation and cannot be paid directly to you. However, you can transfer your entitlement to another approved superannuation entity, including an eligible rollover fund, superannuation fund, deferred annuity, approved deposit fund, retirement savings account or allocated pension. See page 32 for details on preservation. When requested for payment instructions, you will have 90 days in which to advise the Trustee how you want your benefit paid, or to nominate a complying superannuation entity to which you want to roll over your benefit. Eligible Rollover Fund and unclaimed money If you do not tell the Trustee within 90 days how you want your benefit paid, it will automatically be transferred to an eligible rollover fund (ERF). An ERF is a fund approved by APRA to receive benefits payable to members who cannot be located, or who do not advise how and where their benefit is to be paid. The ERF currently used by the Trustee is SuperTrace Eligible Rollover Fund. Its contact details are: The Senior Administrator SuperTrace Eligible Rollover Fund Locked Bag 5429 Parramatta NSW 2124 Tel: If you have reached Government pension age when you leave your employer and you have not given the Trustee instructions regarding the payment of your benefit from the Plan, and you cannot be contacted, your benefit may be treated as unclaimed money according to superannuation law. In this instance, your benefit will be placed with the Chief Commissioner of State Revenue for New South Wales. Your benefit will be considered to be unclaimed money, if you have reached your statutory retirement age and have not told your Trustee how and where to pay your benefit, and you cannot be contacted. If your benefit is transferred to an ERF or treated as unclaimed money, you will no longer be a member of the Plan. However, you have rights to claim your benefit from the ERF or the relevant Government body as the case may be. WORKING FOR YOUR FUTURE 30

32 31 PRESERVATION About SuperTrace Set out below is a summary of some of the more significant features of the SuperTrace Eligible Rollover Fund (SuperTrace), current as at the date of this report: The assets of SuperTrace are invested in a life insurance policy (ERF Policy) issued to Colonial Mutual Superannuation Pty Ltd (CMSPL) by the Colonial Mutual Life Assurance Society Limited (CMLA). The ERF Policy is invested solely in the Colonial Stable Fund in CMLA s No.2L Statutory Fund. There is no choice of investment available to members within SuperTrace. The investment objective of SuperTrace is to provide medium term moderate real rates of return while aiming to minimise the occurrence of negative shorter term returns. The investment strategy for the assets in the Colonial Stable Fund is to invest in a range of assets including Australian and international equities, property, fixed interest securities and cash, with a heavier weighting towards fixed interest investments. Members accounts are generally credited with interest annually. The crediting rate, which is derived from the earning rate of the ERF Policy, is net of tax on investment earnings and fees. Earnings can be negative. The following fees and charges apply in SuperTrace: an asset charge of 1.65% per annum which is deducted from the earnings of the ERF Policy prior to the crediting rate being declared; and a benefit payment fee of $30 is charged for each withdrawal from SuperTrace, subject to member protection legislation, i.e. it will only be charged if a member s account has earned $30 or more in the particular reporting period. If a member s account has earned less than $30, the lesser amount is taken as the benefit payment fee. SuperTrace is unable to accept contributions from members or their employers; however rollovers from other superannuation funds are permitted. SuperTrace does not provide insurance cover. 31 PRESERVATION

33 Restrictions on when you can get access to your benefits Preservation rules Superannuation is a long-term investment and the Commonwealth Government has placed restrictions on when a person can have access to benefits. These restrictions are known as preservation. When you leave the Plan, some or all of your benefit may have to be preserved. This means you may not be able to take all your benefit (less tax) in cash when you leave the Plan. Your benefit statement shows how much of your benefit is preserved. Preserved benefits must generally be kept in the superannuation system until you: retire permanently at or after your preservation age (see below) leave your Employer at or after age 60 reach age 65 become permanently incapacitated as defined in superannuation law (see below), or die. Your preserved amount is shown on your benefit statement. Your preservation age depends on your date of birth according to the table below: Date of birth Your preservation age Before 1 July I July 1960 to 30 June July 1961 to 30 June July 1962 to 30 June July 1963 to 30 June After 30 June Preservation of disablement benefits In some cases it is possible that, even though you may have qualified for a total and permanent disablement from the Plan, the benefit may not be paid to you in cash until you have satisfied one of the above payment triggers. This is due to the difference in definitions between the terms Total and Permanent Disablement, as defined in the Trust Deed and the definition of the term permanent incapacity in superannuation law. For preservation purposes, permanent incapacity, in relation to a member who has ceased to be gainfully employed, means illhealth (whether physical or mental), where the Trustee is reasonably satisfied that the member is unlikely, because of the illhealth, ever again to engage in gainful employment for which the member is reasonably qualified by education, training or experience. WORKING FOR YOUR FUTURE 32

34 33 GOVERNMENT LEGISLATION What s happening in super Choice of fund a reality from 1 July 2005 For several years the Government has been trying to pass legislation that would provide employees with a greater choice around which fund their future superannuation guarantee contributions will be paid to. The legislation has been passed by the Senate and took effect from 1 July An employer is not obliged to provide employees with choice of fund if it is paying superannuation contributions in accordance with a certified agreement. If you are eligible for Super Choice, your decision to choose another fund could have a significant impact on your existing super entitlements in the Plan, including: any insurance cover; and the level of contributions your employer will make to another fund. Contact your employer if you require more details about choice of fund. It s also recommended you seek advice from a licensed or appropriately authorised financial adviser before making any decisions regarding your super. Portability transferring your benefit while still in service Changes to superannuation law that took effect from 1 July 2005 mean you may be able to transfer all or part of your accumulation superannuation benefit to another superannuation arrangement before you leave your employer s service. These changes allow you to request that all or part of your withdrawal benefit be transferred to another fund of your choice. The Trustee must generally comply with your request; however there are certain circumstances in which a transfer request can be refused, these include: if it has already complied with a transfer request within the previous 12 months; if you request to roll over or transfer only part of your interest in the Plan and the amount remaining would be less than $5,000; and if the fund you nominate refuses to accept the transfer. For further information on transferring your superannuation benefit, including how this will affect your remaining superannuation entitlements such as your death and disability benefits, and details of any withdrawal fees that may apply, call Superannuation Administration. The Trustee recommends you seek advice from a licensed or appropriately authorised financial adviser before making any decisions regarding your super. 33 GOVERNMENT LEGISLATION

35 Matching contribution for low income earners The Government has introduced a scheme to enable low income earners (with an income of less than $58,000), making personal contributions to super, to receive a Government co-contribution of up to $1,500. The co-contribution phases out gradually for incomes between $28,000 and $58,000. To be eligible for the co-contribution, the following criteria apply: You need to have made after-tax member contributions (not before-tax salary sacrifice contributions) during the year Your income* was less than $58,000 You need to earn at least 10% of your income from employment as an employee, and You are under age 71 at the end of the financial year. The co-contribution is at the rate of $1.50 for each $1 of after-tax member contributions up to a maximum of $1,500 per annum. The maximum co-contribution will apply for income* up to $28,000 and will phase down to zero for incomes of $58,000. * Income is your assessable income plus your reportable fringe benefits. Surcharge tax Since 1996, higher income earners have been liable for an additional tax on all employer contributions and member pre-tax contributions to super. (Contributions include any fees and charges, such as administration fees or insurance premiums.) The surcharge tax may also have applied to an eligible termination payment made by your employer. It could also have applied automatically if you had not provided your tax file number regardless of what you earned. For the tax year, the superannuation surcharge phased in gradually once your adjusted taxable income (ATI*) exceeded $99,710 and applied at the maximum rate of 12.5% if your adjusted taxable income exceeded $121,075. The surcharge has now been removed on super contributions made on or after 1 July 2005 and eligible termination payments made by an employer on or after 1 July However, it will continue to apply in respect of the period up to 30 June 2005 and super fund trustees still need to report surchargeable contributions for the tax year. This means that the Australian Taxation Office (ATO) will continue to issue surcharge assessments in respect of contributions and eligible termination payments made by employers before 1 July Super fund trustees could therefore continue to receive surcharge assessments for several years for periods ending before 1 July If the Plan is required to pay surcharge tax in respect of you, the tax payable is deducted from your account in the Plan. If you roll over benefits into the Plan from another super fund or from your employer, any liability to pay the surcharge tax for contributions to that fund that has not been paid in respect of the employer payment may be transferred to the Plan. If we receive a surcharge assessment after you have left the Plan, we will return it to the ATO. The ATO will either forward it to the fund to which your benefit was paid or to you if your benefit was paid directly to you. *ATI includes your taxable income, reportable fringe benefits, most benefits paid by an employer on leaving employment, any employer contributions or member pre-tax contributions paid to a superannuation fund, and certain income in respect to family and other trusts. WORKING FOR YOUR FUTURE 34

36 35 GOVERNMENT LEGISLATION New licensing for super trustees The Federal Government has passed legislation to deliver even greater protection for super fund members under the Superannuation Safety Amendment Act The new licensing requirements aim to ensure that trustees have the capacity to effectively manage risks and operate funds in a way which minimises risks to members. The legislation requires the Trustee to obtain a superannuation licence and register the Plan before 1 July The Trustee has recently prepared its licence and registration applications and lodged these with the Australian Prudential Regulation Authority. Updated reasonable benefit limit thresholds Your super benefits will be subject to tax when they become payable to you. A higher rate of tax will apply to any part of your benefit that exceeds your Reasonable Benefit Limit (RBL) which is set by the Government. Most super benefits and employer golden handshake payments you receive in your lifetime are added together and compared with this limit. RBLs are indexed each 1 July in line with increases in Average Weekly Ordinary Time Earnings (AWOTE). For most members, the RBLs are: Some members may be entitled to a higher transitional RBL based on their circumstances in 1994 when the current RBL rules were introduced. As the RBL rules are very complex, you should seek appropriate advice, before you retire, from a licensed or appropriately authorised financial adviser if your benefits are close to or above the RBL limits. Other Government changes in the pipeline Contribution splitting 2004/ /2006 tax year tax year Benefit taken as a lump sum $619,223 $648,946 At least 50% of benefit taken as a complying pension $1,238,440 $1,297,886 In the Federal Budget in May 2005, the Government also confirmed its commitment to introducing legislation to allow contribution splitting. This will allow members to split their personal and employer contributions with their spouse. This proposal, if passed, will apply in respect of contributions made on or after 1 July GOVERNMENT LEGISLATION

37 More Information Resolving disputes and complaints If you have a question about your benefits in the Plan, please contact Superannuation Administration. Most inquiries can be dealt with over the phone. If not, you may be asked to put your enquiry in writing and provide a contact address for the reply. Inquiries will generally be answered within 28 days. If you have a query or a problem, which is not resolved to your satisfaction, you should send a written complaint (including all relevant details) to: The Complaints Officer IAG & NRMA Superannuation Pty Limited Level 13, 388 George Street Sydney NSW 2000 The matter will be investigated by the Complaints Officer and, where necessary, the Complaints Committee on behalf of the Trustee. You will be advised of the Trustee s decision as soon as possible and within 90 days, or within 30 days of the Trustee s decision, whichever is earlier. Please remember to include an address to which the response can be mailed. If the Trustee has not responded to your complaint within 90 days, or you are not satisfied with the Trustee s decision you may be able to take the matter to a special government body called the Superannuation Complaints Tribunal (see below). While the Trustee has a process in place to deal with complaints from members, the Trustee s objective is to avoid complaints by providing a good level of service to members, and if complaints do occur, to resolve them to the satisfaction of all concerned. A copy of the Trustee s enquiries and complaints procedures is available on request from Superannuation Administration. Superannuation Complaints Tribunal The Tribunal is an independent body set up by the Federal Government to provide a low-cost, informal forum for resolving most superannuation disputes. Before the Tribunal can consider a complaint, it must be satisfied that the matter has been referred to the Trustee under the procedure set out above. Any complaints must be lodged with the Tribunal within certain time limits. For more information about requirements and time limits, you can call the Superannuation Complaints Tribunal on If the Tribunal accepts your complaint, it will try to help you and the Trustee reach a mutual agreement through conciliation. If conciliation is unsuccessful, the Tribunal can make a determination, which is binding. WORKING FOR YOUR FUTURE 36

38 G /05

39 37 MORE INFORMATION If you d like more information For accumulation members, full details of the benefits provided by the Plan are set out the Plan s Product Disclosure Statement. For defined benefit members, full details of the benefits provided by the Plan are set out in a member s booklet. As a member of the Plan, you can inspect other Plan documents by contacting Superannuation Administration. These documents are listed on page 2. Questions? If you have questions about your superannuation benefits, please call any of the following in Superannuation Administration: Robert Szomolnoki ext Jacinta Tran ext Troy Maguire ext Gloria Matig-a ext Rachel Jones ext Or (02) if you are calling externally; Alternatively, you can write to them at: Superannuation Administration Level 13, 388 George Street Sydney NSW 2000 DISCLAIMER This annual report has been prepared by the Trustee to meet its legislative obligations under the Corporations Act. The information contained in this annual report does not take account of the specific needs, personal or financial circumstances of any persons. You should obtain specialist advice from a licensed financial adviser before making any changes to your superannuation arrangements or investments. You should also carefully read the Plan s Product Disclosure Statement. The terms of your membership in the Plan are set out in the Plan s Trust Deed, and should there be any inconsistency between this annual report and the Plan s trust deed, the terms of the Plan s trust deed prevail. While all due care has been taken in the preparation of this report, the Trustee reserves its right to correct any errors and omissions. All statements of law or matters affecting superannuation policy are up-to-date as at 1 July This document contains general information about investments and investment performance. Please remember that past performance is not necessarily a guide to future performance. Issued by IAG & NRMA Superannuation Pty Limited ACN as Trustee of the IAG & NRMA Superannuation Plan 37 MORE INFORMATION