YMCA SUPER. YMCA Super. Australian YMCA Superannuation Fund Report for the year ended 30 June We build strong futures.

Transcription

1 YMCA Super YMCA SUPER We build strong futures. Australian YMCA Superannuation Fund Report for the year ended 30 June 2012 YMCA Australia Level 1, 88 Market Street South Melbourne 3205 Ph: Fax: web: Trustee: AUSTYMCA Nominees Pty Ltd RSE Licence L Fund Registration R

2 YMCA Super A message from the Chairman The Trustee of the Australian YMCA Superannuation Fund (YMCA Super) is pleased to present the report to members for the year ended 30 June This Annual Report to Members is designed to provide you with important information about the operation of your Fund, YMCA Super. The Report highlights the financial position and investment performance results of YMCA Super, and alerts you to changes occurring in the Fund. Thank you for taking the time to read our Annual Report. If you have any comments or questions please contact the super staff. Richard Edwards Chairman YMCA Super YMCA Super Directors Richard Edwards (Chair) Alan Bray Rod Ebsworth Ian Heraud Adrian Lombardo Tina Ferguson Sathy Sappany Mark Sargent Company Secretary Ron Mell Staff Petro Boutsikaris, Superannuation Administration Manager Houy Na, Superannuation Finance Manager Candice Brown, Fund Administrator Contact the super staff You can contact the superannuation staff either by: Telephone Fax super@ymca.org.au 02

3 Important Member information Board of Directors YMCA Super is managed by a board of eight Directors. Half the Board is employer appointed and the other half is appointed via an election process where members are given the opportunity to vote for their preferred candidate. Joanne Powell resigned from the Board on 25 May Tina Ferguson was appointed on 25 May Information about the requirements of the role of a member representative Director is included on our website under Fund Elections.. Investment Choice YMCA Super offers investment choice based on two strategies; a Growth investment strategy and a Cash Plus investment strategy. Members are able to choose a blend of the two strategies to create an investment strategy which suits their own individual circumstances and risk profile. Members are able to change their investment strategy quarterly. Information about investment choice in YMCA Super is available on our website select Investment Choice. Alternatively if you would like information sent to you please contact us. Estate Planning YMCA Super members may make either non-binding or binding nominations as to the distribution of their benefit in the event of their death. Non-binding nominations tell the Trustee who your preferred beneficiaries are, but the Trustee will make the final decision as to how and to whom your benefit is paid. The Trustee will consider your preferred nomination but will not be bound by it. The Trustee will exercise a discretion to allocate your benefit among the potential recipients who you nominate. Binding nominations provide greater certainty about who receives your benefit in the event of your death, as your nomination binds the Trustee to pay your Death benefit to a specified person(s) provided that the correct procedure has been followed. Binding Death Nominations If you would like to provide specific instructions to the Trustee about the distribution of your superannuation benefit in the event of your death you should complete a Binding Death Benefit Nomination. The Trustee is obliged to follow the instructions in your Binding Nomination provided it is valid at the time of your death. Binding death nominations expire after three years. If you would like further information please contact YMCA Super. Nominated Beneficiaries In the event a death benefit is payable the Trustee will refer to your nomination and be guided by it when determining how to distribute your benefit. Please take this opportunity to review your Nominated Beneficiaries and update the nomination if appropriate. Refer to page 2 of your latest Annual Review Statement for a list of your current Beneficiaries Superannuation Guarantee Contribution Where an employee s gross income exceeds $450 per month, their employer must pay a minimum of 9% of the employee s income into superannuation. This means that the minimum contribution paid on your behalf in any month will be $40.50 if you have earned $450 or more in a month. If you have questions about the contributions paid into YMCA SUPER by your employer please contact your payroll centre. Your Tax File Number Please ensure that we have recorded your Tax File Number (TFN) to avoid unnecessary additional tax on your contributions or your benefit. Refer to the right hand side of the Personal Details box on the first page of your latest Annual Statement to check whether we have your Tax File Number. If we have received employer contributions on your behalf and we do not have your TFN your employer contributions may be subject to an additional 31.5% tax. This means you will be paying a total of 46.5% tax on your employer contributions. Your Annual Review Statement will illustrate any additional tax within the Full Transaction Statement beginning on page 3. Extra tax will be shown as an Income Tax Expense. 03

4 YMCA Super You should also be aware we are unable to accept any member contributions from you if we do not have your TFN. Member contributions are the contributions which are considered when determining your eligibility for government cocontributions. If we don t have your TFN and you would like to provide it to us please contact YMCA Super. Superannuation information You might like to know! Contribution Limits Employer Contributions Concessional contributions are employer contributions, including salary sacrifice contributions. The concessional contributions caps for individuals are: Age 1 July June July 2012 onwards Under 50 $25,000 $25, or more with more than $500,000 in superannuation 50 or more with less than $500,000 in superannuation $25,000 $25,000 $50,000 $25,000 (plus the cap currently $25,000) When the standard concessional cap (currently $25,000) increases the cap for individuals over age 50, will increase by the same dollar amount. Contributions above the caps will be taxed an additional 31.5%, equaling a tax rate of 46.5%. Member Contributions Personal member contributions made by you from your after tax salary should not exceed $150,000. Normally no contribution tax applies to these contributions. If you exceed the limit your contributions will be taxed at 46.5% If you are less than 65 years you can make a lump sum contribution of up to 3 years member contributions, $450,000, at one time. You will not be able to make a further contribution until the three year time period has elapsed. If you think you have made excess contributions please contact us. Superannuation Co-Contribution For the 2011/2012 financial year, every $1 of eligible personal member contributions you make the government will contribute $1 up to a maximum of $1,000. If you earn up to $31,920 in assessable income and reportable fringe benefits you are eligible for the full co-contribution of $1,000. Earnings in excess of this amount gradually reduce the amount of co-contribution until it phases out to $0 for incomes of $61,920 or above. The government announce changes that, if passed by parliament, will apply to all contributions made from 1 July These are : the maximum co-contribution entitlement will be $ the matching rate to be reduced to 50% the lower income threshold will remain at $31,920, and the higher income threshold will be reduced to $46,920 Minimum Pension Drawdown Over the past three years the Government has halved the minimum pension drawdown percentages applying to account based pensions. The reduction to the minimums was designed to help the recovery of pension account balances after the negative impact of the GFC. The Government has announced that the minimum payment amounts for account based pensions will be reduced by 25% for the 2011/2012 year. There will be no reductions to the minimum from 2012/2013 onwards. Age Under or more Minimum % withdrawal from 1 July June 2011 Minimum % withdrawal from 1 July June % 3% 4% 2.5% 3.75% 5% 3% 4.5% 6% 3.5% 5.25% 7% 4.5% 6.75% 9% 5.5% 8.25% 11% 7% 10.5% 14% Minimum % withdrawal from 1 July June 2013 an onwards 04

5 YMCA Super Information Your Investments Membership YMCA Super was made up of 16,430 members at 30 June Membership is open to all current YMCA employees, and their spouses, in Australia and to former employees who retain their benefit in the Fund. During the reporting period the Trustee transferred 495 inactive accounts with balances of $ or less to AUSFund Eligible Rollover Fund. Administration The Trustee has a service agreement with the National Council of the YMCAs of Australia to provide administration services for YMCA Super. This 3 year agreement was reviewed and renewed commencing 1 July Website Our website aims to provide you with specific information about your fund, YMCA Super as well as general current information about superannuation. It is an important resource for our members. If you have not already visited our website please go to We welcome your feedback about our website. Feedback may be forwarded to super@ymca.org.au. Your Investments From 1 July 2009 YMCA Super offered choice based on two major investment strategies: a Growth strategy, and a Cash Plus strategy. Members may choose to be entirely in one strategy or the other, or a mix of the two, as long as the total percentage in each option equals 100%. For example, 60% Growth and 40% Cash Plus. Further information about investment choice in YMCA Super is available on our website select Investment Choice. Investment Management The Investment Sub-Committee manages the investments of the Fund. The members of the Investment Sub-Committee are: Ian Heraud (Chair of the Sub-Committee) Rod Ebsworth Richard Edwards Adrian Lombardo The Trustee is grateful for the asset consulting advice provided by Shadforth Financial Group to the Investment Sub-Committee.

6 YMCA Super Asset Mix As at 30 June 2012 the asset mix was: 3% 3% 26% International Shares Fixed Interest 10% Property 26% 25% 36% Private Equity Australian Shares 10% 36% 25% The market value of the following investments exceeds 5% of the total market value of the Fund s assets: 5.05% Antares High Growth Shares Trust 6.02% Mosaic Strategic Australian Equity 8.87% Vanguard Australian Shares Index Fund 5.54% BlackRock Wholesale Indexed International Equity Fund 5.87% Vanguard Australian Property Securities Index Fund Fund policy toward derivative securities The use of derivatives in the investment portfolio is limited. A derivative is a financial contract whose value is derived from the associated share value. Derivative transactions include such instruments as futures, options, share ratios, warrants, swaps and other composites. Combined assets invested with a fund manager which exceeds 5% of the total market value of the Fund s assets: Total Percentage Fund Manager 8.95% BlackRock split between Unhedged and Hedged International Equity Funds. 9.10% Mosaic split between Strategic Australian Equity and Strategic International Equity Trust. 7.62% Platinum split across the Asia, European, International and Japan Funds % Vanguard split across the Australian Shares Index Fund, and Australian Property Securities Index Fund. 06

7 Investment Performance Year Ended 30 June 2012 The year ended 30 June 2012 has been a volatile year for the investment markets. Whilst falls in share and property markets continued for some time during the year the market has shown signs of recovery towards the end of the financial year. YMCA Super declared a set of quarterly crediting rates for each investment strategy during the year. The quarterly crediting rates, applied for a full year, produce the following results for the year ended 30 June 2012: Accumulation Accounts -1.12% p.a. for amounts invested in the Growth investment strategy, and 4.95% p.a. for amounts invested in the Cash Plus investment strategy. Pension Accounts 1.05% p.a. for amounts invested in the Growth investment strategy, and 5.80% p.a. for amounts invested in the Cash Plus strategy. Fund Performance Members will be aware the performance of investment markets, such as the share and property market, has direct impact on the investment performance of the Australian YMCA Superannuation Fund (AYSF). Along with the share and property market, a combined impact of a range of events has created a period of uncertainty and volatility in investment markets around the world throughout the financial year: Political instability in the Middle East and North Africa, The European sovereign debt crisis, and Ongoing slow economic recovery and debt issues in the US. During this time of market uncertainty the Trustee has actively tried to minimize the impact of the volatile investment markets by being more defensive in the investment decisions. The YMCA Super Growth strategy had a benchmark of 80% growth assets, comprised of Australian shares, International shares and property, which was revised down to 70% from September 2010 to reduce volatility. Over the longer term the diversity of investments helps to minimise the impact of volatility in specific investment classes. Since 30 June financial markets have enjoyed a steady recovery in which the Australian YMCA Superannuation Fund has participated in. Information about our current interim performance is on our website select Investment Returns. As an active superannuation investor you should be aware that long term performance numbers of around 5 to 10 years provide a good guide of a super fund s performance. Longerterm historical data is useful in assessing the relevance of current year returns to your retirement savings goals, and provides you with some perspective on individual years of overperformance or under-performance. Reserves As at 30 June 2012 YMCA Super held a reserve of 1.78%. The reserve is an allowance for tax provisions on asset valuations, and for operational risk. Reserves are invested in accordance with the Growth investment strategy. No allowance for smoothing is made. 07

8 YMCA Super Growth Investment Strategy Growth Investment Strategy Annual Returns for year ended 30 June 2012 The Growth Investment strategy has a benchmark mix of 70% allocation to growth assets such as shares and property, and 30% in more defensive fixed interest assets such as cash, longer dated Government securities and hybrid investments. The objective of the Growth Investment strategy is to provide returns which exceed inflation by 3 4.5% per year over the long term, 6 to 10 years. How do YMCA Super returns compare in the short term? YMCA Super s annual performance for the year ended 30 June 2012 is competitive when compared to industry performance as published by a number of industry research agencies. The graph of annual returns illustrates YMCA Super s performance for the year ended 30 June 2012 compared to the median figures published by: Chant West West publishes the performance of a range of funds with a growth investment option where growth assets represent between 61 and 80 percent of investments. Chant West is a specialist superannuation research and consultancy firm. Established in 1997, the firm is independent and wholly owned by its two principals, Warren Chant and Andrea West. In addition to its commercial activities, Chant West contributes extensively to the development of better practices with the aim of leading to better and fairer superannuation for all. 0.20% 0.00% -0.20% -0.40% -0.60% -0.80% -1.00% -1.20% YMCA Super Chant West Median Return Selecting Super Median Return YMCA Super s annual performance outperforms the median return reported in the SelectingSuper data, and is competitive with the Chant West survey group. A further survey group which publishes the performance of Funds with a growth investment option which you may refer to is SuperRatings. The SuperRatings website au publishes the latest results, and historical information under media releases. The growth investment option result is the SR50 Growth Index. Selecting Super publishes the performance of a range of industry, corporate and government funds with growth investment options where growth assets represent more than 75% of investments. SelectingSuper is an upto-date interactive resource that provides information about, and links directly with superannuation funds, It also provides calculators, online fund comparisons and lists of the top funds as well as background information to assist in making the right decision when selecting a Super Fund. 08

9 What are YMCA Super s historical returns? The graphs below illustrates the historical annual declared crediting rate over a period of 5 years. Growth Investment Strategy year end 30 June % 15% 10% 5% 0% -5% Pension Rate p.a. Accumulation Rate p.a. -10% -15% Cash Plus Investment Strategy year end 30 June % 5% 4% 3% n/a n/a Pension Rate p.a. Accumulation Rate p.a. 2% 1% 0% 09

10 Inflation YMCA Super How do YMCA Super returns compare over a longer time frame? YMCA Super performance figures show that the average net investment return over the five years to 30 June 2012 was -1.55% p.a. Over this same five year period inflation was 2.77% p.a. Taking a longer term perspective, over the last 10 years YMCA Super achieved a compound average of 5.73% p.a., whilst inflation over the same period averaged at 2.77% p.a. The graph below presents YMCA Super s compound annual return performance over a 5 and 10 year period compared to the compound median long term return figures published by the research agencies outlined above. YMCA Super s performance over the long term is competitive and in particular exceeds the 10 year performance median return published by each research agency, including SuperRatings figures. 6% Growth Investment Strategy Long Term Compound Returns to 30 June % 4% 3% 2% 1% 0% 5yr 10yr 10yr 10yr 5yr 5yr 5yr -1% -2% -3% YMCA Super Selecting Super Chant West **Note that Chant West does not publish a 10 year return figure. 010

11 Inflation YMCA Super Cash Plus Investment Strategy How has the YMCA Super Cash Plus Strategy performed? YMCA Super has offered a Cash Plus investment strategy since 1 July The Cash Plus strategy provides a conservative investment strategy predominantly invested in interest bearing assets. The objective of the Cash Plus strategy is to provide stable returns over a shorter timeframe, and which will keep pace with inflation over the short to medium term, such as 1 to 3 years. Cash Plus Investment Strategy Annual Returns for year ended 30 June % 4% 3% 2% 1% 0% YMCA Super YMCA Super s annual result for the Cash Plus investment strategy illustrates that the annual return of 4.95% exceeds inflation for the year to 30 June 2012 of 1.2% by 3.75%. The Cash Plus strategy achieved a similar result last year, with returns exceeding inflation by 1.37%. 011

12 YMCA Super Interim Crediting Rate From 1 July 2012 Financial statements The latest interim rates are located on our website select Investment Returns. Interim rates reflect market performance and are continually monitored. Interim rates are updated regularly to reflect market performance. Deductions Fees and charges YMCA SUPER charges no Trustee fees because all Directors volunteer their services to the Fund. Entry to the Fund is free and members are charged an annual administration fee of $60. If your account balance at 30 June 2012 is $1,000 or less, the fee is calculated on the value of interest your account balance has earned, subject to maximum of $60. Members who have insurance cover for death or disablement and for ill health have the premium deducted directly from their account balance. The benefit payment fee is currently set at $50 per payment. Government taxes The Government s 15% contribution tax and any surcharge taxes are deducted directly from your contribution account and paid to the Australian Taxation Office. An abridged set of the Fund s audited financial accounts for the 12 months ended 30 June 2012 are presented for your consideration. A full set of the audited accounts and Auditor s report are available on request to the Fund Administrator. Statement of Financial Position at 30 June Investments Australian Shares International Shares Property Diversified fixed income Cash Other Assets 2012 $ ,094 21,213 8,251 12,160 14,989 1, $ ,341 23,124 7,906 13,316 7,843 1,375 Total Assets 88,303 85,905 Less liabilities Income tax payable Provision for deferred income tax Other payable Total Liabilities Net assets available to pay benefits 87,762 85,113 Represented by: Liability for accrued benefits Unallocated reserves 86,197 1,565 83,398 1,715 Total 87,762 85,

13 Operating Statement of the Year Ended 30 June 2012 $ $ 000 Net assets available to pay benefits at the beginning of the period 85,113 74,610 Plus Net Investment revenue Contributions revenue Employer Member Transfers in from other schemes Other Income (1,310) 11, ,648 11, , Total Revenue 11,948 20,702 Less Benefits paid Operating expenses Income tax expenses 6,887 1, ,494 1,335 2,370 Total benefits, expenses and tax 9,299 10,199 Net assets available to pay benefits at the end of the period 87,762 85,113 Trustee The Trustee of YMCA Super is AUSTYMCA Nominees Pty Ltd (ACN ). Ron Mell is the Chief Executive Officer of YMCA Australia and the Company Secretary of the Trust Company. The company is managed by a Board of voluntary Directors which consists of an equal number of National Council appointed and member elected Directors. The Directors operate for the benefit of all Members and are responsible for the management of the YMCA SUPER in accordance with the Trust Deed and governing legislation. The Trustee has taken out indemnity insurance. Indemnity insurance provides protection to the assets of the Fund in the event of legal action involving the Directors. The Trustee Board meets formally each quarter and has appointed an Investment Sub-Committee to manage the investments of the Fund on a day to day basis. The Investment Sub-Committee forwards a monthly report to all Directors and reports to the Board at each quarterly meeting. 013

14 YMCA Super As at 30 June 2012, the Board of Directors consisted of: Member Elected Directors Director Date Appointed Comment Alan Bray Tina Ferguson Sathy Sappany Mark Sargent 27/04/ /05/ /02/ /04/2011 Alan is currently the Chief Executive Officer of the YMCA of Brisbane and Y-Care (South East Queensland) Inc. and is a State Council Director. Alan has served with the YMCA for over 20 years in a number of senior management positions. He also has roles as a member of the National Leadership Team and IT Steering Committee and his qualifications include postgraduate study in finance, economics and business management. Tina is currently the Regional Finance Manager for YMCA Victoria and also provides financial support to YMCA Merchandising. Tina has been employed by the YMCA for over 12 years and previously worked in the insolvency industry for over 13 years. She is a current member of CPA Australia and has a keen interest in matters relating to superannuation and financial planning. Sathy is currently the Finance Manager of the YMCA of Sydney and is a Fellow of the Chartered Institute of Management Accountants and a Member of the Institute of Accountants. He has over 15 years of administration and senior management experience in the areas of financial control, risk management, advanced budgeting and costing techniques. In addition he has experience auditing local and multinational organizations. Mark is a long term employee with the YMCA, having served for more than 22 years in varying managerial roles, both at state and national levels. Mark previously served as a director of the fund in the early part of the decade, and today leads the role as chief Executive Officer of YMCA Estore Pty Ltd. Mark has a keen interest in financial management, investment and the share market, as well as qualifications in recreation and marketing. National Council Appointed Director Date Appointed Comment Rod Ebsworth 19/11/2010 Rod is a Portfolio Manager with Agora Asset Management, a boutique Absolute Return Fund. Rod has 28 years financial markets experience with UBS (24 years), Citi (1 year) and Agora (3 years). Rod served as an employer appointed director of the UBS Staff Superannuation Fund from 1991 until 2007 and has a Bachelor of Economics from Monash University. Richard Edwards 30/11/2001 Richard is a Fellow of the Institute of Chartered Accountants and has over 30 years of experience in firms of Chartered Accountants with National and International Affiliations. He is a Past President and currently a Director of the National Council of the YMCAs of Australia and the YMCA of Brisbane. He was awarded a medal of The Order of Australia in the General Division on the Queen s Birthday 2001 honour list for service to the community. Ian Heraud 26/05/2007 Ian is a Fellow and life member of the Financial Planning Association of Australia (FPA) and is a director of Shadforth Financial Group. He has practiced financial planning for over 25 years and has served as a director of the FPA and the international Financial Planning Standards Board. Ian has co-authored two books on superannuation and financial planning and was the finance expert on ABC Melbourne s Saturday morning finance talk back show. 014 Adrian Lombardo 19/12/2002 Adrian has been involved in the financial services industry for more than 22 years following a successful military career. He is a Senior Vice President Wealth Management at Morgan Stanley Smith Barney, and a past Melbourne Branch Manager of this company, which is a large private client wealth management firm. Prior to joining Morgan Stanley Smith Barney, Adrian worked at Deutsche Bank as an investment advisor, and as a Director for Potter Warburg Securities, Sydney and Brisbane offices. He has also had several years experience as a portfolio and investment manager in the funds management industry. Adrian is an Affiliate of the Securities Institute of Australia.

15 Other information Eligible Rollover Fund (ERF) When your employment with the YMCA ceases we provide you with an estimate of your benefit entitlement from YMCA Super. If your benefit entitlement at this time is less than $200 you may receive your benefit in cash simply by filling in the forms provided with your quote. If you do not complete the forms and return them to us within 90 days we will automatically transfer your benefit to the Unclaimed Super Fund (AUSfund). If we transfer your benefit to AUSfund you cease to be a member of YMCA Super. The contact details for AUSfund are: Member Fees $10 per member per year or part-year. Responsible Entity operation cost of 0.27% Investment management fees of 0.53% As an ERF, all AUSfund accounts are protected from being eroded by administration fees. Members with an account balance below $50 are not charged the administration fee and do receive interest. Phone: (for the cost of a local call) Fax: (for the cost of a local call) Post: P O Box 2468 KENT TOWN SA 5071 Hours: 8.30am to 5.00pm Monday to Friday Web: admin@ausfund.net.au 015

16 Trustee: AUSTYMCA Nominees Pty Ltd YMCA Australia Level 1, 88 Market Street South Melbourne 3205 Ph: Fax: web: RSE Licence L Fund Registration R