Trustee Report for. Holden Employees Superannuation Fund

Transcription

1 Trustee Report for Holden Employees Superannuation Fund

2 Trustee Report for 1 Contents From the Trustee 1 Your Fund Website 2 Super News 4 How your Fund works 6 How your super is invested 7 Investment: Defined Benefit Section 8 Investment: Additional Benefit and Retained Benefit Section 11 Investment options 12 Who manages your Fund? 17 Fees and other costs 18 Financial summary 19 Additional information 2 What to do when you leave your employer 21 Who to contact 22 Issued by Holden Employees Superannuation Fund Pty Ltd, ABN , as Trustee of the Holden Employees Superannuation Fund, ABN November From the Trustee Welcome to the Trustee Report for. I have been a member of the Trustee Board since 25. In December 212, I was appointed as Chair of the Board to replace Andrew White. On behalf of the Trustee Board I d like to thank Andrew White for his service and valuable contribution to the Board and the Fund. He had been Chair of the Board since 26 and oversaw many major issues confronting the Fund, in particular the fallout of the Global Financial Crisis and meeting the demands of all the new superannuation legislation. I d also like to welcome two new Directors to the Trustee Board. Julianne Coleman replaces Andrew and Kevin Kelly, the new Independent Director was chosen by the Trustee Board to replace Debora Jackson. I am pleased to report that, after a number of difficult years in the investment markets, the Fund has achieved strong investment returns for the year ended 3 June the box on the right hand side of this page highlights the Fund s investment returns. The variability of investment returns in the past few years highlights the message that superannuation is a long term investment and you should look at the returns over the long term to get a true picture of how your superannuation is performing overall. The Government has made significant legislative changes to superannuation collectively known as the Stronger Super reforms. The parcel of changes represents one of the most significant reforms to the superannuation industry in almost 2 years. Changes include the introduction of MySuper, SuperStream and 11 new prudential reporting standards. More information about these changes and how they affect the Fund can be found in the Super News section on pages 4 and 5. Over the past year, the Trustee Board has been involved in considerable work to prepare and implement these legislative changes which commenced on 1 July. Kristen Hooke Chair Fund investment returns for the year ending 3 June Investment return of.52% p.a. for the Defined Benefit Section Returns for the investment options under the Additional Benefit and Retained Benefit Sections: > 21.6% p.a. for the Growth Option > 17.5% p.a. for the Balanced Option > 13.3% p.a. for the for the Cautious Option > 9.% p.a. for the Conservative Option > 3.4% p.a. for the Cash Option Please be aware that past performance is not an indicator of future performance. Fund statistics as at 3 June Net assets of $751.3 million 5,925 members (including 38 members in the Retained Benefit Section and 12 pensioners) Benefits totalling $44.3 million paid to retiring and totally and permanently disabled members $1. million paid to families of members who died $21.7 million paid to other members who left the Fund

3 Holden Employees Superannuation Fund 2 Your Fund Website at The Fund website is a great resource offering a wealth of information on the Fund. The website is divided into two parts a public area and a secure member area. The public area of the website The public homepage provides information about the Fund, including: the Fund s Investments the latest Trustee Report access to Fund publications, access to a range of Fund forms. It also includes a range of planning tools and an article library which has special interest and education articles on a range of financial topics not just super. Please note that in the Documents & forms section there are Information Sheets, which are specifically applicable to members of the Fund. The secure member area of website Via the homepage, you can also access up-to-date information on your personal contributions and benefits by signing into the secure member area. Once in the secure member area you can: find out how much super you currently have review and make changes to your Member Investment Choice options view daily unit prices for the Member Investment Choice options update your telephone numbers and address (and if you are a Retained Benefit Section member you can update your home address) view or download your latest Benefit Statement, as well as those going back to 27 view your current beneficiaries for the payment of your death benefits in the Fund, and update them if required view your contribution details, and see how you re tracking against the Government contribution caps that apply (refer to the screen print on the next page) view your correspondence with the Fund, for example a completed Fund form, a financial advisor authority, a roll in to the Fund, PIN reset requests, inquiries you have made to the Fund Helpline. How to sign in To access your personal account, you ll need your Member Number (find this on your last Benefit Statement) and your PIN (a PIN was issued to each member in early April 28). If you have forgotten your PIN, please call the Holden Super Helpline on for assistance. If you ve provided an address to the Fund previously, you can reset your PIN by following the prompts to Reset your PIN from the Sign-in section on the homepage.

4 Trustee Report for 3 Mobile Fund website In May, we launched a mobile version of the Fund website making it easier for you to view your important account information on the go. To access the mobile website you need an iphone, Android, Windows, Blackberry or non-tablet device and simply enter into your browser. You then need your Member Number and PIN to access your personal information. Also, if you have any questions, you can call the Holden Super Helpline at the touch of a button. Contribution caps During the year, the Annual contributions caps page was enhanced. Now, as well as showing your current year-to-date contributions, you can also access your previous financial year contributions with a new Annual contribution caps history page. This new page can be accessed via the Previous year link on the Annual contribution caps page. For detailed information on the contribution caps and their application under the Fund, please refer to an Information Sheet titled Caps on concessional and non-concessional contributions for your category of membership, available on the Fund website.

5 Holden Employees Superannuation Fund 4 Super News The Australian superannuation industry is undergoing a period of profound change. Stronger Super is one of the most significant parcels of reforms to the superannuation industry since the Superannuation Guarantee was first introduced more than 2 years ago. In this update, we give a summary of the changes in super that have taken place over 212/13 financial year and for the future. What s changing in super In April, the Federal Government announced several proposed reforms to superannuation, which were confirmed in the May budget. Further changes were announced in August. Some of these have been legislated and we explain these in more detail below. Briefly, the proposals still to be legislated at the time of going to press are: From 1 July 214 the tax exemption for investment earnings on superannuation assets supporting income streams will be capped at $1, a year for each individual, with a concessional tax rate of % applying for investment earnings over this. Account-based superannuation income streams commenced from 1 January 2 will be subject to the normal deeming rules for social security pension income tests. The Government has already put in place a number of initiatives through the Australian Taxation Office (ATO) to help reunite members with lost super accounts. The account balance threshold for lost super to be transferred to the ATO has increased from $2 to $2, from 31 December 212, and the Labor Government announced a further increase to $4, from 31 December 2 and again to $6, from 31 December 216. These accounts will receive interest equal to increases in the Consumer Price Index (CPI after being transferred to the ATO. Increase in Superannuation Guarantee From 1 July, the minimum employer superannuation contribution (Superannuation Guarantee) increased from 9% to 9.25% of Ordinary Time Earnings. The rate is scheduled to increase to 9.5% from 1 July 214 with further increases each year until the rate reaches 12% in 219. From 1 July, the Superannuation Guarantee requirements will also apply to members over age 7. er concessional contributions limit from 1 July The Federal Government has introduced a higher concessional (before-tax) contribution limit of $35, a year for people aged 6 or over, applying for the /14 financial year. This higher limit will extend to anyone aged 5 or over from 1 July 214. Concessional contributions include employer and salary sacrifice contributions. The higher limit for older workers will be fixed and not indexed (i.e. not increased periodically). In the meantime, for younger workers, indexation of the standard $25, a year concessional limit is expected to resume from 1 July 214, when it is likely to rise to $3, a year. The earlier Government proposal for an annual $5, concessional limit for people aged 5 or over with a balance of less than $5, won t proceed. The following table shows the current limits and how the proposed increased limits may apply in the coming financial years. Table: Concessional contribution limits Concessional Financial year contribution limit 212/13 /14 214/ Standard limit $25, $25, $3, 1 People aged $25, $25, $35, People aged 6 or over 2 $25, $35, $35, 1 Anticipated limit if indexation of the current limit recommences from 1 July Ages are based on your age as at the end of each financial year. New tax treatment of excess concessional contributions Excess concessional (before-tax or employer) contributions made from 1 July will no longer be subject to the excess contribution tax (previously 31.5%). Instead, the excess contributions must be included in an individual s assessable income for the year in which the contributions were made and will be taxed at marginal tax rates. A % non-refundable tax offset will be provided to offset the contributions tax which would have been paid. There will also be a new interest charge on any excess concessional contributions made from 1 July. The charge will apply from the first day of the income year to which the excess contributions relate. This charge effectively charges interest on excess contributions for up to 12 months before the contributions were made and will accumulate daily. The ATO will make a determination of any excess concessional contributions, the amount of additional tax and interest which must be paid. The individual has the right to object in some circumstances.

6 Trustee Report for 5 As a result of the interest charge, for those on the top marginal tax rate, the treatment of excess contributions under these provisions could be harsher than the current rules. Once a notice of excess concessional contributions is received, an individual may choose to have up to 85% of the amount of their excess contributions released from their superannuation. The remaining % relates to the contributions tax paid by the super fund. This is a different approach to that currently used to release amounts from a super fund to pay excess concessional contributions tax. Funds will have to pay any amount requested to the ATO (subject to the member s account being sufficient) from the member s accumulation account. If there is insufficient money in the accumulation account, the fund may voluntarily pay the amount from the member s defined benefit account or an income stream, if they exist. The Fund may impose conditions for such voluntary payments. Additional contributions tax for high income earners The Government s additional contributions tax of % on some or all concessional contributions for members on incomes of $3, or more has been legislated. The tax applies retrospectively from 1 July 212 and operates in a similar way to excess contributions tax. The member will be responsible for paying the additional tax and can generally request to have this paid from their super account. Application of the tax to accumulation accounts is expected to be a relatively straight forward process. However, how the tax for Defined Benefit members will apply has yet to be confirmed. Indications are that notional contributions will not be capped at the concessional contribution limit as generally applies for excess contributions. However, it is not clear how notional contributions will be determined. Any additional tax liability relating to a defined benefit may be deferred until a benefit is paid. We will provide more information about how this tax applies to Defined Benefit members as details are confirmed. Temporary residents can apply for a refund of this additional tax when they have left Australia. Income Earners Government Contribution For most members who earn up to $37, a year, the Government provides a special contribution of % of the employer s contributions up to a maximum Government contribution of $5. The first such Government contributions will be in respect of the 212/13 financial year and are likely to be paid in late /early 214. For this purpose, income includes taxable income, salary sacrifice superannuation contributions, reportable fringe benefits and some other items. Trans Tasman transfers From 1 July it has been possible for members who have permanently emigrated from Australia to New Zealand to transfer their entitlement from their Australian fund to a New Zealand KiwiSaver product. Government legislation lays down strict rules which must be satisfied before the Trustee can agree to transfer a member s entitlement. Likewise, the legislation allows those who permanently emigrate from New Zealand to Australia to transfer their entitlement in a New Zealand KiwiSaver product to an Australian fund. Again strict rules apply. At this stage the Trustee has not yet decided whether to allow such transfers.

7 Holden Employees Superannuation Fund 6 How your Fund works The Fund is divided into three sections: Defined Benefit Section Additional Benefit Section, and Retained Benefit Section. A summary of the features of each Section is provided on this page. Please refer to your Member Booklet or leaflet for detailed information about each Section of the Fund. These are available on the Fund website at Defined Benefit Section The main feature of this Section is that your retirement, death and total and permanent disablement benefits are provided in the form of defined benefits. You can take your retirement benefit as a lump sum or a pension. These benefits are based on: your period of membership, your pension rate and your Base Salary/Wage. For Salaried Payroll members, the pension rate is % for each year of membership. For Plant Payroll members it varies with your Basic Contribution rate as follows: Basic Contribution rate (as a % of Base Wage) Pension rate for membership up to 3/6/25 Pension rate for membership from 1/7/ %.76923% 3..75%.9238% 4. 1.% % % % Your benefit on resignation is an accumulation style benefit, based on your Basic Contributions and interest credited. You make Basic Contributions to this Section. Salaried Payroll members have a Basic Contribution rate of 5% of Base Salary. Each year at 1 July, Plant Payroll members have the option to change their rate of Basic Contributions (see table above) and whether this is on an after-tax or salary sacrifice basis. Your employer pays the balance of the cost of providing the benefits. The Fund Actuary monitors the Fund s financial position and recommends the contribution rate that the employer must make. Government regulations require that an Actuarial Review of the Fund takes place every three years. The purpose of this review is to provide information to the Trustee on the funding and financial status of the Fund. The last completed Actuarial Review covered the three year period ending 3 June and showed that the Fund was in a satisfactory financial position. Page 8 and 9 of this report provides investment and performance details. Additional Benefit Section Any Voluntary Additional Contributions you make to the Fund, any Government Co-contributions, any amounts you roll over or transfer from another fund and any Supplementary Superannuation Contributions made by the employer to the Fund on your behalf are credited to separate accounts established in your name. Each account is made up of the accumulation of these contributions (after deducting any tax payable on employer contributions) with investment earnings (which may be positive or negative). At the end of each quarter, you have the option to change the level of Voluntary Additional Contributions you make to the Fund and whether this is on an after-tax or salary sacrifice basis. You have a choice of investment options in which to invest your account balances and you can change your investment option. Details can be found in the Member Investment Choice Guide available on the Fund website. Pages of this Report provide investment and performance details as at 3 June. Retained Benefit Section Any member who leaves the employer and has a superannuation account balance of more than $1, can leave all or part of their benefit in the Fund. Members of this Section: have access to the Fund s investment options, can roll-in or transfer amounts from other funds, can make lump sum personal contributions, and can make withdrawals of non-preserved amounts. There are no entry fees to the Retained Benefit Section. A regular administration fee is deducted from your account. The fee is: $1.33 per week for year ended 3 June, and $1.4 per week from 1 July. This fee is indexed each 1 July to the increase in Average Weekly Ordinary Time Earnings index.

8 Trustee Report for 7 How your super is invested Your Fund has guidelines for investing Investment objective The Trustee has an investment policy that sets investment strategy and objectives covering how and where the Fund s assets will be invested as well as other investment related matters. The Trustee has established a objective for the Defined Benefit Section and for each Member Investment Choice option and these are shown on the following pages. The Trustee regularly monitors the Fund s performance against its objectives and strategy, and changes are made where necessary. During the year, in consultation with the Fund s Investment Adviser, the Trustee reviewed the Fund s investment return objectives and established a new investment objective, which has three measures a short term, a medium term and a long term (refer next section). The Trustee does not directly use derivative instruments. Derivatives are not an asset class; they are financial contracts in which parties agree to arrangements for buying or selling an asset at a set price at some specified time in the future. Examples are share options or futures. The underlying investment managers may use derivatives in managing their part of the pooled investment vehicles in which the Trustee invests. The use of derivatives is monitored by the Investment Manager. Decisions to invest in or realise investments are based on key financial and managerial criteria. The Trustee does not separately consider social, environmental or ethical factors or labour standards to make these decisions. This and the following pages outline the investment objectives, strategies and performance for each section of the Fund, apart from the Pension section. The assets supporting the Fund s pensions are in a tax-exempt investment. to the For objective there are three measures: to to to to to Short-term Short-term Short-term to to to to to to -term Long-term Long-term Long-term -term balances two s. The first is that a member s superannuation savings will be reduced by volatility and the second is that their super savings will not outperform inflation. This has the same labels as applying to the short and long term s but is based on analysis specific to the definition of medium-term. to to to For this, the standard measure developed by the Association of Superannuation Funds of Australia Limited and the Financial Services Council is used. This measure has seven labels from to based on the expected number of negative annual returns over a 2 year period (refer to the table below). -term -term to to to Short-term is the that a member s superannuation savings will be reduced by the annual volatility of investment markets. Long-term is the that a member s superannuation savings will not significantly outperform inflation over a member s superannuation accumulation lifetime. This has the same labels as applying to the short and medium term but is based on analysis specific to the definition of long-term. Table: Standard Risk Measure Risk Label Estimated number of negative annual returns over any 2 year period Less than.5.5 to less than 1 to 1 to less than 2 2 to less than 3 to 3 to less than 4 4 to less than 6 6 or Greater

9 21.6% % Trustee Report for 8 7.6% Investment: Defined Benefit Section 3.7% % % The assets for GMAC members are fully invested in the Russell Australian Cash Fund. The investment return for the year ended 3 June was 2.48%. This was also the interest rate credited to their Basic Account. Defined Benefit Section for GM Holden Ltd members Investment return objective The long term investment objective is to earn a return (after fees and tax) exceeding the rate of inflation (as measured by the Consumer Price Index (CPI) by at least 3.% p.a. over rolling s. Investment return for the year ended 3 June for the last 5 years % % Defined Benefit Section for GMAC members 11.8% 1 7.2% 7.2% 4.6% 12.1% to % to -5 to 4.4%.9% -.2% 5.5% to Short-term Short-term Investment objective 8% 9.% 6.7% to 4.7% 5.9% to to to to to 212 Short-term Short-term -term -term -term Long-term For an explanation of these s please refer to page 7 of this report. to to

10 Holden Employees Superannuation Fund 9 Investment Strategy The actual asset allocation at 3 June is shown in the table below. Also shown is the strategic asset allocation at 3 June. The strategic asset allocation is determined by the Trustee, in conjunction with the Fund s Investment Adviser, as the appropriate asset allocation mix to achieve the Fund s investment objective. Actual asset allocation % Strategic asset allocation % Asset class at 3 June at 3 June Growth assets Australian Shares International Shares Unhedged International Shares $A Hedged Emerging markets* International Property $A Hedged Global Listed Infrastructure $A Hedged** Total Growth assets Defensive assets Australian Bonds International Bonds $A Hedged Australian Enhanced Cash Total Defensive assets * Emerging Markets This investment is exposed to a broad range of shares listed on the stock exchanges in emerging markets (such as those included in the Russell Emerging Markets Index. These economies typically have higher economic growth but are more susceptible to market fluctuations. ** Global Listed Infrastructure This investment aims to provide exposure to a diversified portfolio of predominantly global listed infrastructure securities on stock exchanges in developing and emerging markets (such as countries included in the S&P Global Infrastructure Index).

11 Trustee Report for 1 Investment Returns and Crediting Rates Whilst retirement, death and total and permanent disablement benefits are provided in the form of defined benefits, your resignation benefit is different as it is an accumulation style benefit and depends on the rate of interest credited to your Basic Contributions. The Fund s Crediting Rate Policy was changed with effect from 1 July. Until the time when the Notional Crediting Rate reserve reached nil, the Crediting Rate continued to be calculated using the existing smoothing approach but with a minimum rate of zero. When the Notional Crediting Rate Reserve reached nil, the Crediting Rate would be the actual investment return (which may be positive or negative). In March 212, the Notional Crediting Rate Reserve reached nil and therefore from 1 April investment earnings are allocated to member s Basic Account using a Crediting Rate equal to the actual investment return (which may be positive or negative). The table below shows the history of the investment returns and the Crediting Interest Rate over the 5 years to 3 June. Year as at 3 June Investment Return % p.a. Crediting Interest Rate % p.a Rate for the Past performance should not be taken as an indication of future performance. Investment returns can go up or down.

12 Trustee Report 11 Investment: Additional Benefit Section and Retained Benefit Section Investment options There are five investment options available for investing your accounts: Growth, Balanced, Cautious, Conservative and Cash. Your accounts invested in units Your accounts buy you units in your chosen investment options. The price of units varies from day to day, depending on the value of the underlying assets. As contributions go into your accounts, you get more units in your chosen investment options. The total value of your accounts at any time is simply your total number of units in your chosen investment options multiplied by the relevant unit sell price. The impact of transaction and operational costs on the unit prices (i.e. expenses, commissions, brokerage and other fees which are incurred in buying or selling part or all of the underlying investments of each investment option) is passed on to members through what is commonly referred to as the buy/sell spread. The buy/sell spread is the difference between the (higher) price at which members can purchase units (the buy price) and the (lower) price at which members can sell units (the sell price). No part of the buy/sell spread is paid to the Trustee. For an example on how buy/sell spreads work in practice, please read the example on page 16 of the Member Investment Choice Guide, available on the Fund website. The buy/sell spread is different for each investment option and can change over time. The buy/sell spreads at 1 November 212 were: Growth option:.56% of the amount invested. Balanced option:.52% of the amount invested. Cautious option:.46% of the amount invested. Conservative option:.36% of the amount invested. Cash option: Nil. The latest buy/sell spreads for all options are available on the Fund website. Changing your investment choice You can change your investment choice at any time. You can choose to invest your accounts in one or more investment options. You may also invest your current account balances one way and your future contributions a different way. To change your investment choice, you can either do this online or complete and return a Changing your investment choice form (which is available on the Fund website or by calling the Holden Super Helpline). Your change will be processed on the first business day after your form is received. Before making a decision to change your investment option you should read the Member Investment Choice Guide, also available on the Fund website. There are two costs which apply to changing investment options. There is the buy/sell spread and a processing fee of $3. which is debited to your account. Monitoring your investment You can view the performance of each investment option on the Fund website, which shows up-to-date unit prices for all investment options. The net earnings on your chosen investment option (which may be positive or negative) will be reflected via changes in the unit prices. Remember it is very important for most members that you take a long-term view of your investment rather than focusing on short-term results. Investment returns and objectives The charts and tables on the following pages show each investment option s objectives and strategy applicable at 3 June, and returns over the past five years. The investment returns quoted reflect the change in unit prices over the year expressed as a percentage. The unit prices for each option reflect the value of the underlying investments after making provision for investment tax and investment management fees. Past performance should not be taken as an indication of future performance. Remember, investment returns can go up or down. Investment objectives on these pages are not a financial forecast.

13 2 16.4% 12 5 Approximately 9% growth assets and 1% defensive assets. Suitable for investors who: are seeking to build wealth over the long term plan to invest for 6 years or more are willing to accept the possibility of negative returns over the short to medium term. 9.8 Alternative Strategies 6-2.9% 2.6 Cash International Fixed Interest 9.8 Alternative Strategies -3.7% 1.9 International Property 5.1 Australian Fixed Interest Growth Option 2.6 Cash 2.6 Cash 3.8 International Fixed Holden 5.1 Interest Australian Fixed Interest Employees Superannuation Fund Australian Fixed Interest 7.6% International Fixed Interest 9-5 Investment return objective International Property 38.3 Australian Shares 38.3 Australian Shares 2.3 Australian Property This rolling s. -1 option aims to earn a return (after investment fees and tax) of at least 4.% p.a. above the Consumer Price Index (CPI) over to 2.3 Australian Property 9.8 Alternative Strategies to - the to 3 June, this objective For was theaustralian CPI for the same period was 2.3% p.a. However the 38.3 Shares Return for thenot met: the investment return was3.7% p.a. and Note: There is no 5 year return for this option as it commenced in October. 5 year period investment return was in line with the 51.9 year return of 3.8% p.a in the Chant West Multi-Manager Survey funds from with1growth assetstobetween 81% and 1%. International Property The return for for the period October 3 June 212 was 5.5%. 28. International Shares (unhedged) -19.1% Australian Property % 7.6% to 3.7% % % 2 1 to Short-term to 4.6% % Short-term Short-term -13.8% 12.8% 5 to -1 -term -term -.5% 12.1% 11.8% to -5 -term 27 Australian Property 2.7% International Property 2.% Alternative Strategies 14.5% Australian Fixed Interest 4.5% Cash 3.9% 1 Australian Property 2.7% International Property 2.% Alternative to Strategies 14.5% Australian shares 35.% Australian Fixed Interest 4.5% International sharescash (hedged) 3.9% 27.4% International Shares (unhedged) 1.% Australian shares 35.% 27.4% International shares (hedged) International Shares (unhedged) 1.% Australian Property 2.7% International Property 2.% Alternative Strategies 14.5% 2 Australian Fixed Interest 4.5% Cash 3.9% to 7.2% 5 to Australian shares 35.% International shares (hedged) 27.4% International Shares (unhedged) 1.% to 17.5%.7% Investment objective International Shares (hedged) International Shares (hedged) Short-term 1-1 Where the assets were invested at 3 June 28. International Shares (unhedged) 21.6% International Shares (hedged) 28. International Shares (unhedged) Investment return for the year ended 3 June for the last 5 years.9% to -14.9% For an explanation of these s please refer to page 7 of this report. 4.4% 212 Long-term Long-term

14 % % Approximately 7% growth assets and 3% defensive assets. Suitable for investors who: are seeking to built wealth over the medium to long term plan to invest for 5 years or more are willing to accept the possibility of negative returns over the shorter term. Trustee Report for % 1 Balanced Option 5 3.7% Investment return objective % This option aims to earn a return (after investment fees and tax) of at least 3.5% p.a. above the Consumer Price Index (CPI) over rolling s. to to For the five year period to 3 June, this objective was not met: the investment return was 4.6% p.a. and the CPI for the same period was 2.3% p.a. -1 However the investment return exceeded the 5 year return of 4.1% p.a in the Chant West Multi-Manager Survey for funds with Growth Assets between 61% and 8% % % to % to -5 Annual Compound Australian shares 29.% 21.% International shares-14.9% (hedged) - International shares (unhedged) 7.9% Australian Property 2.% International Property 1.8% Alternative Strategies.7% Australian Fixed Interest 11.% International Fixed Interest 6.2% Cash 5.4% 12.8% Investment objective 12 to Australian shares 29.% International shares (hedged) 21.% International shares (unhedged) 7.9% -1 Short-term 4.4%.9% to -.2% % 12.1% 11.8% 1 7.2% 5 Short-term %.7% Where the assets were invested at 3 June Investment return for the year ended 3 June for the last 5 years Australian Property 2.% International Property 1.8% 5 year period Alternative Strategies.7% Australian Fixed Interest 11.% International Fixed Interest 6.2% -term Cash 5.4% 9.% 9 to % to 5.9% to 4.7% to to to % Short-term Short-term -term -term For an explanation of these s please refer to page 7 of this report. Long-term Long-term

15 Holden Employees Superannuation Fund 14 Cautious Option Investment return objective This option aims to earn a return (after investment fees and tax) of at least 3% p.a. above the Consumer Price Index (CPI) over rolling s. Approximately 5% growth assets and 5% defensive assets. 13.3% Suitable for investors who: 16.4% 21.6% some capital are seeking over the medium term growth plan to invest for 4 years or more 7.6%are willing to accept the possibility of negative returns over the shorter-2.9% term. 212 Where the assets were invested at 3 June Investment return for the year ended 3 June 12 9 to 6 to -3.7% to Note: There is no 5 year return for this option as it commenced in October. Short-term The return for the period from 1 October to 3 June 212 was 5.5%. Australian shares 21.7% International shares (unhedged).% International shares (hedged) 5.8% Australian Property 1.9% International Property.8% Alternative Strategies 13.5% Australian Fixed Interest 18.% International Fixed Interest 9.2% Australian Cash 14.1% Investment objective to Australian shares 21.7% International shares (unhedged).% International shares (hedged) 5.8% 3 Australian Property 1.9% International Property.8% Alternative Strategies 13.5% Short-term Australian Fixed Interest 18.% International Fixed Interest 9.2% Australian Cash 14.1% 21.6% 16.4% to to to 7.6% to to to 3.7% % Short-term Short-term -term -term -term Long-term For an explanation of these s please refer to page 7 of this report..7% 17.5% 2 to 12.1% to.5% to to to

16 2.7% 1 Conservative Option Approximately 3% growth assets and 7% defensive assets. Suitable for investors who: are happy with slower growth plan to invest for 3 years or more can accept only very little volatility in returns % % 27 Investment return objectives Trustee Report for 12.1% 11.8% 1 7.2%.5% %.9% 212 option aims to earn a return (after investment 212 This fees and tax) of at least 2.% p.a. above the Consumer Price Index (CPI) over rolling s. to -.2% to -5 For -5 the five year period to 3 June, this objective was not met: the investment return was 5.9% p.a. and the CPI for the same period was 4.3% p.a. However the investment return exceeded the 5 year return of 4.9% p.a in the Chant West Multi-Manager Survey for funds with Growth Assets between Annual Compound -1 21% and 4% % - Where the assets were invested at 3 June Investment return for the year ended 3 June for the last 5 years -14.9% - Short-term 12.8% 12 9.% 9 6.7% 6 to % to 4.7% to to 27 to Australian shares 12.3% to % Short-term -6 Australian shares 12.3% 6.3% International shares (unhedged) International shares (hedged) 3.1% Short-term Australian Property.6% International Property.7% Alternative Strategies 14.% Australian Fixed Interest 23.9% International Fixed Interest 14.3% Australian Cash 24.8% 1 Investment objective to 4.1% 4.7% to Short-term -term 212 Australian Property.6% International Property.7% Alternative Strategies 14.% Australian Fixed Interest 23.9% International Fixed Interest 14.3% -term Australian Cash 24.8% to to 3.46% 3.9% 2.9% to 4.4% International shares (unhedged) 6.3% International shares (hedged) 3.1% Annual Compound -term -term For an explanation of these s please refer to page 7 of this report. to Long-term Long-term

17 12.8% 12 9.% 9 6 1% defensive assets. Suitable for investors who: are happy with slow growth plan to invest for the short term want to minimise the chance of any volatility in returns. 5.9% 4.7% Cash Option Holden Employees Superannuation Fund % Investment 27 return objectives This option aims to earn a return (after investment fees and tax) above the UBS Bank Bills Index over rolling 1 year periods. This objective was to to return for the year ended 3 June was met: the investment 3.46% and the UBS Bank Bill Index was 3.3%. to to % -6 Investment return for the year ended 3 June for the last 5 years Where the assets were invested at 3 June At 3 June the Cash Option was invested in the managed Cash Option by JANA Investment Advisers. This is invested in Australian Fixed Interest, International Short-term Fixed Interest and Australian Cash.Short-term % 4.1% 4 4.4% 3.46% 2.9% 3.9% to to to to -term -term Investment objective to to to Short-term Short-term to to -term Long-term For an explanation of these s please refer to page 7 of this report. to Long-term Long-term

18 Trustee Report for 17 Who manages your Fund? Your Fund is run by the Trustee company called Holden Employees Superannuation Fund Pty Ltd ABN The Trustee manages the Fund according to the Fund s Trust Deed and superannuation laws. Trustee insurance protection The Fund pays for insurance to protect the Trustee, its Directors and your Fund against claims against it. The Directors are not insured for liability arising from dishonest, wilful or reckless acts. Trustee Board As at 3 June, the Directors of the Trustee Company were: Appointed by FVIU Eddy De Geest Port Melbourne, Victoria Heinz Joham Elizabeth, South Australia Alex Kyriakopoulos Elizabeth, South Australia Appointed by GM Holden Kristen Hooke (Chair) Port Melbourne, Victoria Ashley Winnett Port Melbourne, Victoria Julianne Coleman Port Melbourne, Victoria Effective 27 December 212 Andrew White resigned as a Trustee Director and the Trustee Chair. Effective 28 December 212 Julianne Coleman was appointed a Trustee Director and Kristen Hooke was appointed as the Trustee Chair. Independent appointed by the Trustee Board Kevin Kelly Effective 1 January, Kevin Kelly was appointed as the Independent Director. Fund Advisers The Trustee is assisted by the following advisers: Actuary Mercer Consulting (Australia) Pty Ltd Administrator and Consultants Mercer Outsourcing (Australia) Pty Ltd Auditor Deloitte Touche Tohmatsu Insurer CommInsure Investment Managers Russell Investment Management Ltd JANA Investment Advisers Investment Consultant Chant West Solicitor Maddocks Who manages the investments? During the year, the assets of the Defined Benefit Section and the Growth, Balanced, Cautious (since 1 October ) and Conservative options were invested in the Russell Pooled Superannuation Trust. This Trust, through its underlying funds managed by Russell Investment Management Ltd, provides access to some of the leading asset class specialist investment managers in the world. The Fund invests in the Russell Pooled Superannuation Trust and not with the individual investment managers selected by Russell Investment Management Ltd. During the year, the Cash Option was invested in a Cash Option managed by JANA Investment Advisers. The Fund has 12 pensioners and the underlying assets are invested in the Pensions Cautious Option managed by JANA Investment Advisers.

19 Holden Employees Superannuation Fund 18 Fees and other costs This section shows fees and other costs you may be charged. These fees and costs may be deducted from your account, from the returns on your investment, or from the Fund assets as a whole. You need to take into account the impact of tax as well. You do not pay GST on any of the fees and costs shown. The Trustee has the right to increase fees at any time. You will receive at least 3 days notice of any increase in fees. Type of fee or cost Amount How and when paid Fees when your money moves in or out of the Fund Establishment fee Nil The fee to open your Fund membership Contribution fee The fee on each amount contributed either by you or your Employer Withdrawal fee The fee on each payment made by the Fund Termination fee The fee to close your Fund membership Management costs The fees paid to administer your benefit The fees paid to the investment managers Buy/sell spread This applies when contributions are made, roll-ins/transfers received and withdrawals made. Service fees Investment Option Change Fee There is no fee deducted from your contributions, but a buy/sell spread applies to contributions made to the Additional Benefit Section and Retained Benefit Section (see Management costs below) There is no fee when paying your full benefit in one payment. A fee of $78.29 for any partial payments Nil Defined Benefit Section and Additional Benefit Section: Nil Retained Benefit Section: $1.33 per week up to 3 June and $1.4 per week from 1 July Defined Benefit Section:.52% p.a. of your Basic Contribution Account Additional Benefit Section and Retained Benefit Section: - Cash Option:.23% p.a. of your account balance invested in this option - Conservative Option:.39% p.a. of your account balance invested in this option - Cautious Option:.42% p.a. of your account balance invested in this option - Balanced Option:.45% p.a. of your account balance invested in this option - Growth Option:.48% p.a. of your account balance invested in this option Additional Benefit Section and Retained Benefit Section: Buy/sell spread (refer to page 11 for explanation) Processing fee of $3. payable each time you request a change to your investment option. Not applicable Not applicable Deducted from the payment at the time of payment. Not applicable Not applicable Deductions are made from a member s account annually at 3 June or at earlier exit Deducted from the investment earnings before declaring the Section s net earning rate. Deducted from the investment earnings before declaring the unit prices. Deducted from the transaction amount through the daily unit price on the day of the transaction Deducted from your account balance at the time of the change. Family law fees Application for information (i.e. benefit valuation) in the format specified under the Family Law Act $1. Paid by person making the request at time request is made. Splitting a benefit $7. Shared equally by both parties and will be deducted from each party s benefit at the time the benefit is split unless all of the benefit is going to the non-member spouse (in which case the non-member spouse pays the entire fee). Flagging a benefit None Not applicable

20 Trustee Report for 19 Financial summary This is a summary of the Fund s audited accounts for the year ended 3 June. You can request a copy of the audited accounts and auditor s report from the Fund Secretary Changes in net assets for the year ended June 212 $ $ Net Assets at beginning of the year 684,93, ,45,1 Investment Earnings Change in Net Market Value of Investments 6,253,87 96,93,45 Investment Income 428,14 8,712 Management fee rebates 1,976,312 1,991,17 Contributions Member contributions - Defined Benefit Section: After Tax Member Basic 1,852,854 1,729,314 - Voluntary Additional Contributions 287, ,558 - Government Co-contributions 98,89 43,952 Employer contributions - Defined Benefit Section Salary Sacrifice Member Basic 9,388,813 5,285,67 Employer 16,527,86 11,752,292 - Salary Sacrifice Voluntary Contributions 3,959,638 2,89,272 - Supplementary Superannuation Contributions and Contributions for Casual and Fixed Term employees 8,94,948 8,938,246 Other Income Member Transfers In 711, ,91 Insurance Proceeds 255,89 716,881 Sundry 1, Total Income 5,646, ,81,54 Less Outgoings Benefit Payments 33,4,468 67,66,612 General Administration Expenses 1,913,339 2,35,822 Insurance Premiums 1,86,43 1,255,841 Surcharge Payments - 5,659 Income Tax Expense 5,378,212 3,845,444 Total Outgoings 41,532,422 74,479,378 Equals Net Assets at end of year 694,45,1 751,367,277 Net assets at 3 June 212 $ Investments $ Cash at Bank 7,558,367 7,38,625 Pooled Superannuation Trusts 668,524,5 729,72,383 Life Policies 21,71,661 2,547,991 Other Assets Contributions Receivable 3,18,193 1,451,51 Investment Income Receivable 26,391 12,531 GST Receivable 29,639 45,825 Future Income Tax Benefit 4,522 4,253 Group Life proceeds receivable 9,236,687 Prepayments 11,66 1,219,131 Total Assets 71,1, ,578,477 Less Liabilities Benefits payable 4,953,916 6,679,365 Creditors and Accrued Expenses 48, ,554 Income Tax Payable 1,141,182 71,679 Provision for Deferred Income Tax 452, ,62 Total Liabilities 6,956,18 8,211,2 Net Assets 694,45,1 751,367,277

21 Holden Employees Superannuation Fund 2 Additional information If you have a query Most queries can be sorted out over the phone, but if we are unable to help you immediately, you may be asked to put your question in writing. If you are not satisfied with the response, you should write to the Fund Secretary, who will pass on your complaint to the Trustee. You can expect a decision within 9 days. The Trustee always seeks to resolve any complaints to the satisfaction of all concerned and in the best interests of all members of the Fund. However, if you have followed the steps outlined above and are not satisfied with the outcome, you may be able to take the matter to the Superannuation Complaints Tribunal (SCT). The SCT is an independent body that aims to resolve certain types of superannuation disputes. Any complaints must be lodged with the SCT within certain time limits. For more information about requirements and time limits, you can contact the SCT via its online complaint service at or call the SCT on If the SCT accepts your complaint, it will try and help you and the Fund reach a mutual agreement through conciliation. If conciliation is unsuccessful, the complaint may be referred to the SCT for a determination that is binding. Like to know more? As a member of the Holden Employees Superannuation Fund, you would have received a Member Booklet containing information about your benefits and the rules governing the Fund. You also receive an annual Benefit Statement containing important personal information about your benefits in the Fund. Other documents relating to the Fund that are available for you to look at are the: Trust Deed, latest audited accounts and auditor s report, and Privacy Policy. If you have a question about your benefits in the Fund, please contact the Fund Administrator. Please note that none of the Trustee Directors, the Fund Secretary or the Fund Administrator is able to give any personal financial advice relating to your own circumstances. Surcharge For some higher income earners and members who had not supplied their TFN, there has been an additional tax known as the surcharge on certain contributions and some termination payments made by your employer. The surcharge ceased at 3 June 25. Although the surcharge has been removed in respect of future contributions, it will apply in respect of the period up to 3 June 25. This means that the ATO will continue to issue surcharge assessments in respect of contributions and termination payments made before 1 July 25. If the Fund is required to pay surcharge tax in respect of you, the tax payable is deducted from your benefit in the Fund. If you roll over benefits into the Fund from another super fund, any liability to pay the surcharge for contributions made to that fund that has not been paid may be transferred to the Fund. If we receive a surcharge assessment after you have left the Fund, we will return it to the ATO. The ATO will either forward it to the Fund to whom your benefit was paid to or to you if your benefit was paid direct to you. Special tax treatment Super can be one of the most effective ways to save because it is taxed at a lower rate than many other forms of income. To get this tax advantage, your Fund must operate according to a strict set of laws. To show that your Fund has followed these laws, the Trustee lodges a return each year with the Australian Prudential Regulation Authority. The Trustee is unaware of any event that occurred during the year that would affect this special tax treatment. The Fund is a regulated complying superannuation fund for the purposes of government legislation. No penalties were imposed on the Trustee under the Superannuation Industry (Supervision) or Corporations legislation during the year.

22 Trustee Report for 21 What to do when you leave your employer If you are about to leave your employer make sure you respond promptly to letters from the Trustee about your benefit payment. If you have reached age 65 and have not told the Fund how and where to pay your benefit, and you cannot be contacted, then your benefit will be considered to be unclaimed money. It will then be placed with the ATO. You will then need to contact the ATO to find out how to claim your benefit. In the past, unclaimed money was sometimes put to State or Territory unclaimed money authorities. If your benefit is more than $1, and you are under age 65, and you do not respond to the Trustee within 9 days of leaving, your benefit will be automatically transferred to the Fund s Retained Benefit Section. If your benefit is less than $1, and you are under age 65, and you do not respond to the Trustee within 9 days of leaving, your benefit will be transferred to an Eligible Rollover Fund (ERF). Upon transfer, you will no longer be a member or have any rights under the Holden Employees Superannuation Fund. The ERF used by the Fund is AMP Eligible Rollover Fund. Set out below is a summary of some of the significant features of the AMP Eligible Rollover Fund, current as in this date of this Trustee report: The assets of the AMP Eligible Rollover Fund are invested in a capital guaranteed life insurance policy (Policy) issued to AMP Superannuation Limited (ASL). The Policy is a participating policy in AMP Life s No. 1 Statutory Fund (AMP No 1 Fund). There is no investment choice available to members within the AMP Eligible Rollover Fund. The investment return (crediting rate) will not be negative. The investment objective for balances over $2,5 is to provide returns over the longer term (adjusted for costs and tax) exceeding those from cash.. The investment strategy for the AMP Eligible Rollover Fund is to invest in a portfolio with a core of cash and limited exposure to shares. AMP Life declares multi-tiered crediting rates of investment earnings (interest) with respect to the Policy. The interest to be credited to a member s account is calculated based on a member s daily balance and credited annually (or on withdrawal). There are no fees charged directly to a member s account by ASL. Administration and investment fees as well as taxes (including earnings tax) are deducted by AMP Life before declaring any interest to be credited under the Policy. The AMP Eligible Rollover Fund is unable to accept contributions from members or their employers, however rollovers from other superannuation funds are permitted. The AMP Eligible Rollover Fund does not provide insurance cover. Should you wish to know more about the AMP Eligible Rollover Fund, contact an AMP Customer Service Officer on for a copy of their Product Disclosure Statement or go to amp.com.au Continuing your insurance The Fund s insurance policy provides a continuation option for death cover, which you may exercise if you are eligible (there are certain conditions that apply). This allows you to apply for a replacement individual insurance policy with the insurer within 6 days after your cover under the Fund s insurance policy ceases without the requirement to provide satisfactory evidence of good health. Cover under the continuation option is generally available up to the insured amount at the date your cover under the Fund s policy ceases. The cost of continuing your cover outside the Fund will be based on the insurer s prevailing individual policy premium rates, terms and conditions. You will need to pay the premium for any individual policy you take out under the continuation option. For more information, refer to the Information Sheet Insurance arrangements and options when you leave employment on the Documents & forms page of the Fund website. When you leave employment, you should call the Holden Super Helpline on for more information about continuing your insurance.

23 Trustee Trustee Report Report for 22 Who to contact Log onto the Fund s website Call Holden Super Helpline Fund Administrator at holden@mercer.com Write to the Fund Administrator Holden Employees Superannuation Fund c/o Mercer Outsourcing (Australia) Pty Ltd GPO Box 433 Melbourne Vic 31 Write to the Fund Secretary Holden Employees Superannuation Fund c/o Mercer Outsourcing (Australia) Pty Ltd GPO Box 9946 Melbourne Vic 31 Advice about your super If you require information about your benefit in the Fund, contact the Holden Super Helpline on The Helpline is able to provide details of your current benefits over the phone. Please note that Helpline staff are not representatives of the Trustee. Any general financial product advice provided by Helpline staff is provided by Mercer Outsourcing (Australia) Pty Ltd, AFSL No employees of GM Holden Limited or GMAC Australia LLC are authorised to provide general financial product advice to Fund members. Please note that none of the Trustee, its Directors, the Fund Secretary or the Fund Administrator is able to give any personal financial product advice relating to your own circumstances. If you require any personal advice about superannuation, you should consult a licensed financial adviser.

24 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. Members should obtain specialist advice from a licensed financial adviser before making any decisions regarding their own superannuation arrangements or investments. The terms of your membership in the Fund are set out in the Fund s Trust Deed, and should there be any inconsistency between this annual report and the Fund s Trust Deed, the terms of the Fund 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 current as at date of issue. This document contains general information about investments and investment performance. Please remember that past performance is not necessarily a guide to future performance. Trustee Trustee Report Report 23