PRODUCT DISCLOSURE STATEMENT

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1 Section About the Elphinstone Group Superannuation Fund How super works Benefits of investing with the Elphinstone Group Superannuation Fund Risks of super How we invest your money Fees and costs How super is taxed Insurance in your super How to open an account Elphinstone Group Superannuation Fund 19 March 2018 PRODUCT DISCLOSURE STATEMENT About this Product Disclosure Statement This Product Disclosure Statement (PDS) is a summary of significant information and contains a number of references to important information (each of which forms part of the PDS). You should consider that information before making a decision about the product. The information provided in the PDS is general information only and does not take account of your personal financial situation or needs. You should obtain financial advice tailored to your personal circumstances. Information contained in this document that is not materially adverse is subject to change from time to time and may be updated if it changes. Updated information can be found at In addition, we will provide a hardcopy free of charge on request if you contact the Fund Administrator on Issued by Elphinstone Group Superannuation Pty Ltd (ABN ), as Trustee of the Elphinstone Group Superannuation Fund (ABN ). MySuper Authorisation number

2 1About the Elphinstone Group Superannuation Fund The Elphinstone Group Superannuation Fund (the Fund) is a superannuation fund specifically designed for current and former employees of the Elphinstone Group. The Trustee of the Elphinstone Group Superannuation Fund is made up of six Directors half are appointed by the Company and half are elected by Fund members. Having this structure allows the Fund to provide tailored benefits to the Company s employees. The Fund provides you and your family with flexibility to save for your retirement. It includes a MySuper option. There is also the option to take out a pension when you are nearing or have reached retirement. On you will find the Elphinstone Group Superannuation Fund MySuper product dashboard. You can also find information about the Trustee, including executive remuneration and any other documents required to be disclosed under the superannuation legislation. 2 How super works 3 Benefits of investing with the Elphinstone Superannuation is a way to save for retirement that is, in part, compulsory. For many people, it is likely to be their main source of income in retirement. The Company currently contributes at least 9.5% of your Ordinary Time Earnings (OTE) to your superannuation account this is known as the Superannuation Guarantee (SG). You can also contribute money to help your superannuation grow. The money in your superannuation account is invested and earns investment returns over the years until you retire. The Government provides tax savings, so the money contributed to your superannuation account may be taxed less than the tax you pay on your salary. This allows your superannuation to grow. The Government has rules in place which mean you generally cannot access the money in your superannuation account until you reach what is known as your preservation age generally between age 55 and 60 or you satisfy another condition of release. Contributions There are different types of contributions available to you. Company contributions The Company contributes money to your superannuation account on your behalf. Additional voluntary contributions To help your superannuation grow, you have the option to contribute additional amounts to your superannuation. You can generally make these contributions from your before-tax salary or after you have paid tax. Government co-contributions If you make a contribution to your superannuation from your after-tax salary and your salary is under the limit set by the Government, you may be eligible for an additional contribution from the Government. Conditions apply. You can transfer money you have in other superannuation funds into the one fund. The Government places limits on how much can be contributed to superannuation before extra tax applies. See page 5 for more information. Choosing your super fund Choice of Fund legislation allows most working Australians to choose which superannuation fund they want to belong to. As an employee of Elphinstone Group (Aust) Pty Ltd or an approved participating employer, you can participate in Choice of Fund and choose a fund other than this Fund for the superannuation contributions the Company makes on your behalf. If you do not make a choice, Elphinstone Group (Aust) Pty Ltd will pay your Company contributions to its selected MySuper fund, which is this Fund. Unless you tell the Trustee otherwise, these contributions will be invested in the Fund s MySuper option. Group Superannuation Fund There are a number of benefits of being a member of the Elphinstone Group Superannuation Fund. The Company currently contributes at least 9.5% of your OTE into the Elphinstone Group Superannuation Fund for you. You can make additional voluntary contributions to your superannuation from your before or after-tax salary. You can keep your entire superannuation in the one fund by rolling your previous superannuation into your account in the Fund. You have a choice of four investment options to suit different investment styles and investment timeframes. To help protect you and your family from the unexpected, the Fund provides insurance cover to eligible members if you should die or become terminally ill or totally and permanently disabled. You may also have the option to take out additional voluntary insurance cover to provide you and your family with extra financial security. You can continue to be a member of the Elphinstone Group Superannuation Fund even if you stop working at the Company, by transferring your benefit to the Fund s Retained Benefits Division. There may be changes in your insurance cover in this case see the guide, Additional information about your superannuation for more information. i You should read the important information about how super works before making a decision. Further details about how super works are contained in the guide, Additional information about your superannuation in the section How super works. Go to The material relating to how super works may change between the time when you read this Statement and the day when you acquire the product

3 You can stay a Fund member in retirement by taking your superannuation as a pension, or you can take out a Transition to Retirement Pension which pays an income while you are still working once you have reached your preservation age. See the PDS, A Guide to your Account-Based Pension, for more information. We want to stay in touch. Each year you will receive a Personal Statement of Benefits outlining the value of your superannuation. We will also provide an Annual Report and other information to keep you up to date with your superannuation. You can check and review your latest benefit information and account balance, download forms and publications and review the Fund s investment options and latest performance all via To provide you with greater security around who receives your superannuation in the event of your death, you have the choice of making either a binding or non-binding beneficiary nomination. To nominate your preferred beneficiaries, please complete an Application & Change form. i You should read the important information about the benefits of investing with the Elphinstone Group Superannuation Fund before making a decision. Further details are contained in the guide, Additional information about your superannuation in the section Benefits of investing with the Elphinstone Group Superannuation Fund. Go to The material relating to the benefits of investing with the Elphinstone Group Superannuation Fund may change between the time when you read this Statement and the day when you acquire the product. 4 Risks of super As with all investments, there are risks with investing with the Elphinstone Group Superannuation Fund. These risks may exist in any superannuation fund you become a member of. Your level of risk will vary depending on a range of factors including your age, investment timeframe, other investments and risk tolerance. Investment risk The Elphinstone Group Superannuation Fund offers you a choice of four investment options, each with different strategies and different levels of risk and expected return. The level of risk depends on the option s assets. Generally, the higher an investment s potential long-term return, the greater the risk associated with that investment. Historically, investment in shares has provided the highest average returns over the long term but has also demonstrated the greatest volatility in the short term. Over the longer term, lower-risk investments, such as cash or fixed interest, generally provide lower returns, but are less volatile than shares. The value of your account in the Fund will vary and may rise or fall, in line with the performance of the investment markets in which your money is invested. You should remember that past performance is not necessarily a reliable indicator of future performance. Returns from the Elphinstone Group Superannuation Fund may be positive or negative and are not guaranteed. When you leave the Fund, you may get less than the amount of contributions paid in by you and your employer because of taxes, fees and low or negative investment returns. Other risks Being a member of the Elphinstone Group Superannuation Fund does not automatically mean that you will have enough money to live on in your retirement. Your future superannuation savings and investment earnings may not be sufficient to adequately provide for your retirement. The Company may decide to amend the Elphinstone Group Superannuation Fund s Trust Deed, or the Fund may close in the future. This may affect the value of your superannuation account balance or payout. The Fund may also be exposed to other risks such as changes in the economic and political climate, fraud or other criminal activities (including identity theft). Not all of these risks can be controlled by the Trustee. A change in the laws that govern superannuation may impact on your ability to access your money in the future or affect the tax effectiveness of your superannuation savings. We will keep you informed about any material changes that may affect your superannuation. i You should read the important information about the risks of superannuation before making a decision. Further details are contained in the guide, Additional information about your superannuation in the section Risks of super. Go to Specific investment risks are included in the Investment Guide (go to and insurance risks are included in the Insurance Guide (go to insuranceguide.pdf). The material relating to risks of superannuation may change between the time when you read this Statement and the day when you acquire the product

4 5 How we invest your money The Fund has four investment options Growth, Balanced, Conservative and Cash. You can choose one or a mix of these options. If you do not make an investment choice when you join the Fund, your superannuation is invested in the Balanced option. This is also the option for MySuper members. Changing your investment choice You can change how your superannuation is invested at any time by making a switch. As your needs change, so can your preferred investment strategy. To change your investment choice, you will need to complete an Application & Change form, available from the Fund Administrator or the Fund s website. You can also make your change via the Fund s website. Note that fees do apply. Details of the Balanced option (MySuper option)! Each investment option has a different level of investment risk and likely return. When making your investment choice, it is important to consider the risk and likely return of an investment option and whether it suits your investment timeframe (the length of time until you will need your superannuation). Overview This is a diversified option which invests across the major asset classes, but with a significant weighting towards growth assets. This option may be suitable for members who expect to invest their superannuation for more than 5 years. Investors in this option may be seeking a diversified portfolio, which aims to achieve moderate to high capital growth over the medium to long term with a high level of investment volatility (which may include periods of negative returns). Investment objective To achieve a return (after tax and investment fees) that is at least 2% per year more than movements in the Consumer Price Index (CPI) over moving 5-year periods. Strategy To invest about 70% in growth assets and about 30% in income assets. Benchmark asset allocation and ranges Cash 4.6% (0.6% to 8.6%) Global aggregate bonds (hedged) 19.2% (15.2% to 23.2%) Australian fixed interest 8.2% (4.2% to 12.2%) Emerging market shares (unhedged) 0.9% (0% to 4.9%) Minimum suggested investment period 5 years or more Australian shares 34.0% (30.0% to 38.0%) International shares (hedged) 15.4% (11.4% to 19.4%) International shares (unhedged) 17.7% (13.7% to 21.7%) Likelihood of a negative return in any 20 year period* 6 years out of every 20 years Volatility level* Very high Very low Very high Note: The information about the suitability of a particular option is general in nature and is included as required by law. It is not intended to be a recommendation or statement of opinion in relation to any particular option. Members are encouraged to seek their own advice if they are uncertain as to which option might be most appropriate for them. * The volatility level shown is based on industry guidance to allow members to compare investment options that are expected to deliver a similar number of negative annual returns over any 20-year period. It is based on the Standard Risk Measure developed by the industry and is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be or the potential for a positive return to be less than a member may require to meet their objectives. Further, it does not take into account the impact of administration fees and tax on the likelihood of a negative return. Members should still ensure they are comfortable with the range of risks and potential losses and gains associated with their chosen investment options. i Further details about investments, including information about the Fund s other investment options, investment risks and how to change options are contained in the Investment Guide. You should read the important information about investments before making a decision. Go to investmentguide.pdf. The material relating to investments may change between the time when you read this Statement and the day when you acquire the product

5 6 Fees and costs DID YOU KNOW? Small differences in both investment performance and fees and costs can have a substantial impact on your long-term returns. For example, total annual fees and costs of 2% of your fund balance rather than 1% could reduce your final return by up to 20% over a 30-year period (e.g. reduce it from $100,000 to $80,000). You should consider whether features such as superior investment performance or the provision of better member services justify higher fees and costs. You or your employer, as applicable, may be able to negotiate to pay lower fees. Ask the fund or your financial adviser. TO FIND OUT MORE If you would like to find out more, or see the impact of the fees based on your own circumstances, the Australian Securities and Investments Commission (ASIC) website ( has a superannuation calculator to help you check out different fee options. Information in this section can be used to compare costs of the Fund with other similar superannuation funds. The fees and costs may be deducted from your account in the Fund or from the returns on your investment. ASIC s superannuation calculator at can be used to check the effect of fees and costs on your account balance. Elphinstone Group Superannuation Fund Balanced (MySuper) option Type of fee Amount How and when paid Investment fee Administration fee 0.20% p.a. to 0.30% p.a. ($2.00 to $3.00 per $1,000) $410 $460 p.a. plus 0.30% p.a. ($3.00 per $1,000) Deducted from monthly returns prior to the returns being credited to your account. The dollar fee is deducted from your account at the end of each month and on leaving the Fund. The percentage-based fee is deducted from monthly returns prior to the returns being credited to your account. The amounts shown are estimates. Buy-sell spread Nil for amounts switched less than $250,000 Balanced (MySuper) option 0.17% of the amount switched ($1.70 per $1,000) Deducted from your account when you change your investment option(s), if applicable (based on the option you switch into). Switching fee $50 Deducted from your account each time you change investment options. Exit fee Advice fees relating to all members investing in a particular MySuper product or investment option Other fees and costs $772 members whose Fund benefits are transferred to the new superannuation provider at the transfer date* $ members who withdraw or transfer their entire account balance to another superannuation fund before the transfer date* $ members who make a partial withdrawal or partial transfer to another superannuation fund from their account balance before the transfer date* Nil See the guide, Additional information about your superannuation. Deducted from your account when you leave or are transferred from the Fund or when you withdraw money from the Fund. If you have been in the Fund for two years or less as at the transfer date* and your Fund benefits are transferred to the new superannuation provider at the transfer date, the Company will make an additional contribution of $772 to cover your exit fee. Not applicable. Indirect cost ratio Nil Not applicable. * This is the date that the Fund will be closed and members will be transferred to another superannuation provider see Fund closure announcement and Q&As at for more information

6 Example of annual fees and costs for the Balanced (MySuper) option This table gives an example of how the fees and costs in the Balanced (MySuper) option for this superannuation product can affect your superannuation investment over a one year period. You should use this table to compare this superannuation product with other superannuation products. EXAMPLE Balanced (MySuper) option BALANCE OF $50,000 Investment fees 0.30% p.a. ($3.00 per $1,000) For every $50,000 you have in the Balanced (MySuper) option you will be charged $150 each year* PLUS Administration fees PLUS Indirect costs for the Balanced (MySuper) option EQUALS Cost of product $460 p.a. plus 0.30% p.a. ($3.00 per $1,000) Nil And, you will be charged $610 each year in administration fees* And, indirect costs of nil each year will be deducted from your investment If your balance was $50,000, then for that year you will be charged fees of $760 for the Balanced (MySuper) option * The top of the range fee is required to be quoted. The dollar fee shown would apply only if the maximum estimated fee applies. The percentage-based fee is an estimate only. Note: Additional fees may apply. And if you leave the superannuation fund, you may also be charged an exit fee (see page 4 for the amount) and a buy-sell spread which also applies whenever you make an investment switch of $250,000 or more. The buy-sell spread for exiting is nil. Fee changes All fees and charges are current as at the date of this PDS and may be revised by the Trustee from time to time without your consent. Some fees will be indexed each year in line with increases in Average Weekly Ordinary Time Earnings and the Trustee may also introduce new fees. We will generally give you 30 days of notice of changes to fees and charges. The fees charged may depend on your employment status or category of membership. i You should read the important information about fees before making a decision. Go to For definitions of various fees, refer to the website at The material relating to fees may change between the time when you read this Statement and the day when you acquire the product. 7 How super is taxed Tax on contributions Generally a 15% contributions tax is deducted from concessional contributions (such as the Company s and your salary sacrifice contributions) when received by the Fund. This tax does not apply to any after-tax contributions unless you claim a tax deduction for them. There are limits on how much you can contribute to superannuation before extra tax applies. The current concessional contributions limit is $25,000 and the after-tax (non-concessional) contributions limit is $100,000. There will be tax consequences for you if your contributions exceed the limits. Tax on investment earnings Tax at up to 15% is deducted from the Fund s investment earnings before the earnings are applied to your account. Tax on withdrawals Lump sum and pension payments from the Fund after age 60 are generally tax free. Tax may apply before age 60 and will be deducted before your benefit is paid to you. All taxes deducted are paid to the Australian Taxation Office when required.! i You should provide your Tax File Number (TFN) to the Fund. This may save you tax. Normally the Company will provide your TFN to the Fund when you start work. If you don t provide your TFN, higher tax can apply to certain payments and some types of contributions cannot be accepted. Further details about tax are contained in the guide, Additional information about your superannuation in the section How super is taxed. You should read the important information about tax before making a decision. Go to The material relating to tax may change between the time when you read this Statement and the day when you acquire the product

7 8 Insurance in your super To help protect you and your family from the unexpected, the Elphinstone Group Superannuation Fund automatically provides eligible employees with standard insurance cover for death (including terminal illness) and total and permanent disablement. If you would like extra financial security in the event of death or disablement, and you are eligible for standard cover, you can also apply for additional insurance cover. You are entitled to receive standard insurance cover if you are: A full-time employee; or A permanent part-time employee working at least 15 hours each week. Members over the age of 65 and members serving in the armed forces do not receive standard insurance cover unless advised otherwise in writing. Casual employees, contractors, permanent employees working less than 15 hours per week and members of the Retained Benefits Division receive death only insurance cover. Employed members aged 65 to 70 can opt to take out voluntary death only insurance cover. Generally, standard cover starts automatically on the day you join the Fund, provided you were actively at work in your usual occupation on that day. If you were not, or if you did not join the Fund when first eligible or if your cover exceeds the limits set by the insurer, you may be required to provide evidence of good health and be approved by the insurer before cover commences. If you take leave without pay, your cover will normally continue for up to two years provided that you satisfy certain conditions. If you are intending to take leave without pay or to travel overseas for an extended period, you should confirm in advance that your insurance cover will continue. Death and disablement cover Your standard insured benefit will be calculated as: 10.5% x Salary x future years and complete months to age 65 where Salary is equal to your weekly wage multiplied by the number of weeks in the year. The annual fees for death and disablement cover depend on your age and range from $0.57 to $26.14 per $1,000 of your insured benefit. If you do not opt out (see page 7), the fee will be deducted from your superannuation account. The amount will appear on your annual Personal Statement of Benefits.! If you do not cancel your cover and you do not opt out, the fees for any cover will be deducted from your superannuation account

8 Additional cover You can choose the amount of additional cover you wish to apply for, but the insurer may impose a limit on the amount it will agree to provide. You may be asked to provide health or other evidence to support your application. Your eligibility to purchase additional cover is subject to approval by the Fund s insurer and will not commence until approval is granted. Like most insurance cover, the fee for your additional cover depends on your age and how much additional voluntary insurance cover you would like to purchase. The annual fees for additional voluntary insurance cover range from $0.64 to $32.84 for every $1,000 of insurance you wish to purchase. The fee for your additional voluntary insurance cover will be deducted from your superannuation account. The amount will appear on your annual Personal Statement of Benefits. Changing or cancelling insurance You can opt out of your standard cover by notifying the Fund Administrator in writing. You can opt out of all standard cover, or opt out of standard total and permanent disablement cover. You cannot opt out of standard death cover but retain your standard total and permanent disablement cover. You can also change the amount of your additional cover or cancel your additional cover at any time. To apply for, or increase, your additional voluntary insurance cover, complete an Application for additional voluntary insurance cover form, available from the Fund Administrator or the Fund s website and return it as directed. To cancel or decrease your additional cover, simply write a letter to the Fund Administrator with your instructions. i Further details about insurance including important conditions, exclusions, risks and fees are contained in the Insurance Guide. This information may affect your entitlement to insurance cover. You should read the important information about insurance before making a decision including whether the insurance is appropriate for you. Go to The material relating to insurance may change between the time when you read this Statement and the day when you acquire the product. 9 How to open an account Joining the Elphinstone Group Superannuation Fund is easy! Just follow these simple steps. 1. Read this PDS carefully to learn about the options and features available to you. 2. Consider your superannuation choices for: Additional voluntary contributions; Rollovers; Your investment choice; Your insurance cover; and Your beneficiaries. Once you have made your choices, complete and return the appropriate forms at the back of this PDS and the Insurance Guide. Enquiries or complaints If you have any questions, would like to make a complaint or would like more information about the Fund, please contact the Fund Administrator at the address to the right. In most cases, your enquiry will be resolved over the phone. If not, you may be asked to write to the Fund. The matter will be referred to the Trustee and you should receive a reply within 90 days. If you are not satisfied with the Trustee s response, you may wish to contact the Superannuation Complaints Tribunal (SCT) except in relation to privacy-related matters. The SCT is an independent body set up by the Federal Government to deal with enquiries or complaints that the Trustee has not dealt with to your satisfaction. The SCT may mediate the dispute. You can contact the SCT on or write to info@sct.gov.au. Protecting your personal information The Trustee believes your privacy is important and so has developed a Privacy Policy to protect your personal information. The policy outlines how the Fund collects and manages your personal information. A copy of the policy is available from the Fund Administrator and the website. If you would like to access or update your personal information, please contact the Fund Administrator. Contact details are below. General enquiries If you have any questions or would like more information about the Elphinstone Group Superannuation Fund, please contact: W P E M egsfsuperadmin@linksuper.com The Fund Administrator Elphinstone Group Superannuation Fund PO Box 1442 Parramatta NSW 2124 Peter Hansen Fund Secretary Elphinstone Group Superannuation Fund Nantilla Road Clayton VIC 3168 (03) phansen@elphinstonegroup.com.au i You should read the important information about your account in the Fund before making a decision. Further details are contained in the guide, Additional information about your superannuation in the section How to open an account. Go to The material relating to your account may change between the time when you read this Statement and the day when you acquire the product. 7

9 Application & Change form The Elphinstone Group Superannuation Fund (the Fund) gives you a number of choices for your superannuation, including the option to: Make additional voluntary contributions from your before-tax or after-tax salary; Decide how you would like to invest your superannuation; and Choose who should receive your benefits if you die while a member of the Fund. You can use this form to MAKE your superannuation choices when you join the Fund or CHANGE your superannuation choices if you re currently a member. Please tick one of the boxes below. I wish to JOIN the Fund. OR I am a current member of the Fund and wish to CHANGE my superannuation choices. Part A: Your details Last name (please PRINT) First name Title Home address Mr Mrs Ms Miss Date of Birth / / State Postcode Providing your address The Trustee may decide to provide information about the Elphinstone Group Superannuation Fund or your benefits electronically in the future. This may include Product Disclosure Statements, Personal Statements of Benefits, Exit Statements, Annual Reports, newsletters or information on material changes to your superannuation or significant events. If you d like to receive information electronically, where available, please provide your address. Your Tax File Number* * Under the SIS Act, the Trustee is authorised to collect your TFN, which will only be used for lawful purposes. These purposes may change in the future as a result of legislative change. The Trustee may disclose your TFN to another superannuation provider, when your benefits are being transferred, unless you request the Trustee in writing that your TFN not be disclosed to any other superannuation provider. It is not an offence not to quote your TFN. However, giving your TFN will have the following advantages, which may not otherwise apply: Your superannuation fund will be able to accept all permitted types of contributions to your account; The tax on contributions to your superannuation account will not increase; Other than the tax that may ordinarily apply, no additional tax will be deducted when you start drawing down your superannuation benefits; and It will make it much easier to trace different superannuation account(s) in your name so that you receive all your superannuation benefits when you retire. Part B: Your additional voluntary contributions Complete this section if you want to make or change your contribution choices. I want to make additional voluntary contributions of: $ per month/per fortnight. These contributions should be deducted from my (please tick ONE box only): Before-tax salary (also known as concessional contributions ) OR After-tax salary (also known as non-concessional contributions )

10 Part C: Your investment choice Complete this section to make your investment choice. I wish to invest my superannuation as shown below: Growth option % Balanced option (MySuper option) % Conservative option % Cash option % Total 100 % If you don t make a choice and you are a new member, 100% of your superannuation will be invested in the Balanced option which is also the option for MySuper members. For existing members, your superannuation will remain in the option/s you chose previously. If you need to change your investment option/s, you can do so at any time. Your form will be processed on the next business day after it is received by the Fund Administrator. Part D: Payment of your death benefit You can tick ONE or both boxes below. In the event of my death, I would like any benefit (excluding any Account-Based Pension benefit I have in the Fund) paid to: My estate (legal personal representative). And/Or My dependants as shown in the table below (e.g. must be spouse, de facto of either sex, children, any person who is dependent on me for financial support or any person with whom I have an interdependency relationship *). * An interdependency relationship is where: 1. Two people have a close personal relationship; and 2. They live together; and 3. One or each of them provides the other with financial support; and 4. One or each of them provides the other with domestic support and personal care. However, if two people have a close personal relationship but do not satisfy the other conditions because one or both of them suffer from a physical, intellectual or psychiatric disability, then their relationship still meets the definition of interdependency. The Law includes details of various matters that the Trustee must consider in deciding whether two people have an interdependency relationship. Name of nominated dependant Relationship to me (please circle) Portion of benefit spouse / child / dependant / interdependant spouse / child / dependant / interdependant spouse / child / dependant / interdependant Legal personal representative (i.e. your estate) spouse / child / dependant / interdependant Please note that your parents, brothers or sisters are unlikely to be dependants under the Law. To be dependants, they would have to rely on you for financial support or be in an interdependency relationship with you (as described above). Total 100%

11 Binding and non-binding nominations It s your choice. You can allow the Trustee to use its discretion in determining who should receive your death benefit. The Trustee will be guided by your nomination, but not bound by it. Or You can make your nomination binding on the Trustee. If you do so, then the Trustee must pay your death benefit in the way you have indicated on this form, if your nomination is valid at the time of your death. If you want your nomination to be binding, this form must be completed in the presence of two witnesses, who are at least 18 years old and who are not beneficiaries. You will need to update your binding nomination every three years. Please refer to the guide, Additional information about your superannuation for more information on making a nomination. Non-binding nomination I would like the Trustee to use its discretion when paying my death benefit. Your approval (for non-binding nominations) I understand that the Trustee will use my nomination as a guide but is not bound by the nomination I have made on this form. Signature: Date: / / OR Binding nomination I would like the Trustee to be bound by my nomination. Your approval and signatures (for binding nominations) I understand that the Trustee will be bound by this nomination form (if valid): Until another nomination form is received from me; or Until three years have passed. I understand that a binding nomination must meet the rules as summarised in this Part D to be valid. If my nomination is invalid, the Trustee will pay the full value of my death benefit at its discretion. Signature: Date: / / Your witnesses I declare that: This form was signed and dated by I am at least 18 years old; and I am not a nominated beneficiary of this death benefit. in my presence; Full name: Date of birth: / / Signature: Date: / / I declare that: This form was signed and dated by I am at least 18 years old; and I am not a nominated beneficiary of this death benefit. in my presence; Full name: Date of birth: / / Signature: Date: / /

12 Part E: Declaration I agree to be bound by the terms and conditions contained in the Trust Deed and insurance policy of the Elphinstone Group Superannuation Fund. I have received and understood the Fund s Product Disclosure Statement. I declare that the information I have provided on this form is true to the best of my knowledge and belief. I understand and acknowledge that: My insurance cover All insurance is subject to the conditions in the Fund s insurance policy. My additional voluntary contributions The Company will deduct any additional voluntary contributions from my salary as shown in Part B of this form, commencing with my next pay following receipt of this form. Any future increase or decrease I request to be made to my additional voluntary contributions can be made after at least one month s notice to my employer of my request to change. My investment choice My superannuation will be invested in the investment option/s I have chosen in Part C of this form. If I have not made an investment choice, 100% of my superannuation in the Fund will be invested in the Balanced (MySuper) option (if I am a new member) or in my existing option/s if I am an existing member. Neither the Trustee nor my employer guarantee the investment returns of my chosen investment option/s, and my account balance may fluctuate both upwards and downwards over time. If I need to, I can change my investment option/s at any time by completing another Application & Change form and returning it to the Fund Administrator, or by making this change online through the Fund s website at Fees will apply if I change my investment choice. I also understand and acknowledge that: The choices made on this form replace any previous instructions I may have given. Any fees and taxes that may apply to my benefits in the Elphinstone Group Superannuation Fund will be deducted from my accounts in the Fund. The Trustee reserves the right to increase the fees or introduce new fees without my consent. I have received, read and understood a summary of the Fund s Privacy Policy as set out in the Fund s Product Disclosure Statement. Signature: Date: / / Please return your completed form to Payroll OR If you are only changing your investment choice, please return your completed form to: The Fund Administrator Elphinstone Group Superannuation Fund PO Box 1442 Parramatta NSW 2124 Payroll use only Payroll number: Date joined the Company/Fund: / / Date of birth: / / Employer name: Employer location: Tax File Number: Superannuation salary: Full Time Equivalent Total Remuneration (if part-time): Date Administrator advised: / / Category: N C Casual Contractor At work on DJF: Yes No State: Authorised by: Date authorised: / / address (for reply with Member Number): Status: Full-time permanent employee Part-time permanent employee hours per week Fixed-term contractor term of contract Casual employee Issued by Elphinstone Group Superannuation Pty Ltd (ABN ) as Trustee of the Elphinstone Group Superannuation Fund (ABN ). MySuper Authorisation number March 2018.

13 Rollover form Use this form if you would like to roll money into the Elphinstone Group Superannuation Fund. Complete the form and send it to your previous superannuation fund to let them know your details and where they should send your money. Complete a separate form for each rollover and please attach relevant proof of identity documents as outlined over the page prior to sending. To the superannuation fund administrator I request that you roll my superannuation from your fund, the name of which I have written in the box below, to the Elphinstone Group Superannuation Fund. Previous superannuation fund name Membership no. My details (please print) Last name First name Home address Mr/Mrs/Ms/Miss Date of birth Postcode Telephone no. (Business hours) My current superannuation fund Name of fund Elphinstone Group Superannuation Fund Fund ABN Unique Superannuation Identifier (USI) Telephone number Notice of compliance status The Elphinstone Group Superannuation Fund is a complying superannuation fund and is able to accept rollovers from other complying funds. The Fund complies with the Superannuation Industry (Supervision) Act and Regulations. The Fund will observe any preservation requirements attached to the rollover. My approval Please complete the form by signing and dating below. Signature Date / / Keep a copy of this form and send the form to your previous superannuation fund. Issued by Elphinstone Group Superannuation Pty Ltd (ABN ), as Trustee of the Elphinstone Group Superannuation Fund (ABN ). MySuper Authorisation number March 2018.

14 Acceptable proof of identity documents The following documents may be used: EITHER One of the following documents only: A driver s license issued under State or Territory law, or Passport. OR One of the following documents AND One of the following documents A birth certificate or birth extract, A letter from Centrelink regarding a A citizenship certificate issued by Government assistance payment, or the Commonwealth, or A notice issued by the Commonwealth or a A pension card issued by Centrelink that entitles the person to financial benefits. State or Territory Government or local council within the past twelve months that contains your name and residential address. For example, a Tax Office Notice of Assessment, or rates notice from your local council. Have you changed your name or are you signing on behalf of another person? If you have changed your name, or are signing on behalf of the applicant, you will need to provide a certified linking document. A linking document is a document that proves a relationship exists between (two or more) names. Here is some information about suitable linking documents. Purpose Change of name Signed on behalf of applicant Suitable linking document Marriage Certificate, Deed Poll or Change of Name certificate from the Births, Deaths and Marriages Registration Office. Guardianship papers or Power of Attorney. Certification of personal documents All copied pages of ORIGINAL proof of identification documents (including any linking documents) need to be certified as true copies by any individual approved to do so (see the following page). The person authorised to certify documents must sight the original and the copy and make sure that both documents are identical, then make sure that all pages have been certified as true copies by writing or stamping certified true copy followed by their signature, printed name, qualification (e.g. Justice of the Peace or Australia Post employee) and date. The following people listed overleaf can certify copies of the originals as true and correct copies.

15 A person who is enrolled on the roll of the Supreme Court of a State or Territory, or the High Court of Australia, as a legal practitioner, A Member of the Institute of Chartered Accountants in Australia, the Australian Society of Certified Practising Accountants or the National Institute of Accountants, An agent of the Australian Postal Corporation who is in charge of an office supplying postal services to the public, An Australian Consular Officer or Australian Diplomatic Officer (within the meaning of the Consular Fees Act 1955), Bailiff, A bank officer with 2 or more continuous years of service, A building society officer with 2 or more years of continuous service, A Chief Executive Officer of a Commonwealth court, A clerk of a court, A Commissioner for Affidavits, A Commissioner for Declarations, A member of: (a) the Parliament of the Commonwealth; or (b) the Parliament of a State; or (c) a Territory legislature; or (d) a local government authority of a State or Territory, A Minister of religion registered under Subdivision A of Division 1 of Part IV of the Marriage Act 1961, A Notary Public, A permanent employee of the Australian Postal Corporation with 2 or more years of continuous service who is employed in an office supplying postal services to the public, A permanent employee of: (a) the Commonwealth or a Commonwealth authority; or A credit union officer with 2 or more years of continuous service, An employee of the Australian Trade Commission who is: (a) in a country or place outside Australia; and (b) a State or Territory or a State or Territory authority; or (c) a local government authority, with 2 or more years of continuous service who is not specified in another item in this list, (b) authorised under paragraph 3 (d) of the Consular Fees Act 1955; and (c) exercising his or her function in that place, An employee of the Commonwealth who is: (a) in a country or place outside Australia; and (b) authorised under paragraph 3 (c) of the Consular Fees Act 1955; and (c) exercising his or her function in that place, A Fellow of the National Tax Accountants Association, A finance company officer with 2 or more years of continuous service, A holder of a statutory office not specified in another item in this list, A Judge of a court, A Justice of the Peace, A Magistrate, A Marriage celebrant registered under Subdivision C of Division 1 of Part IV of the Marriage Act 1961, A Master of a court, A Member of Governance Institute of Australia, A Member of Engineers Australia, other than at the grade of student, A Member of the Association of Taxation and Management Accountants, A person before whom a Statutory Declaration may be made under the law of the State or Territory in which the declaration is made, A police officer, A Registrar, or Deputy Registrar, of a court, A senior executive service employee of: (a) the Commonwealth or a Commonwealth authority; or (b) a State or Territory or a State or Territory authority, A Sheriff, A Sheriff s officer, A teacher employed on a full-time basis at a school or tertiary education institution, A Member of the Australasian Institute of Mining and Metallurgy, An officer with, or authorised representative of, a holder of an Australian financial services licence, having 2 or more years of continuous service with one or more licensees, A licensed or registered Chiropractor, A licensed or registered Dentist, A licensed or registered Medical practitioner, A licensed or registered Nurse, A licensed or registered Optometrist, A licensed or registered Patent attorney, A Member of the Australian Defence Force who is: (a) an officer; or (b) a non-commissioned officer within the meaning of the Defence Force Discipline Act 1982 with 2 or more years of continuous service; or (c) a warrant officer within the meaning of that Act, A licensed or registered Pharmacist, A licensed or registered Physiotherapist, A licensed or registered Psychologist, A licensed or registered Trademarks attorney, and/or A licensed or registered Veterinary surgeon.

16 Elphinstone Group Superannuation Fund 19 March 2018 Additional information about your superannuation Contents Important information 1 How super works 2 Benefits of investing with the Elphinstone Group 5 Superannuation Fund Risks of super 8 Fees and other costs 9 How super is taxed 14 Leaving employment 16 How to open an account 18 Issued by Elphinstone Group Superannuation Pty Ltd (ABN ), as Trustee of the Elphinstone Group Superannuation Fund (ABN ). MySuper Authorisation number

17 Important information The information in this document forms part of the Product Disclosure Statement (PDS) for the Fund s Accumulation section, dated 19 March This information should be read in conjunction with the other documents that form part of the Product Disclosure Statement. You should consider this information before making a decision about the relevant product. The information provided is general information only and does not take into account your particular objectives, financial circumstances or needs. It is not personal or tax advice. Any examples included are for illustration only and are not intended to be recommendations or preferred courses of action. You should consider obtaining professional advice about your particular circumstances before making any financial or investment decisions based on the information contained in this document. Neither the Trustee nor Elphinstone Group (Aust) Pty Ltd can provide you with financial advice. The Trustee will only provide factual information. Information on tax and superannuation legislation is current as at 1 July 2017, unless otherwise noted. The Trustee reserves the right to correct any errors or omissions. Information contained in this document that is not materially adverse is subject to change from time to time and may be updated if it changes. Updated information can be found at In addition, we will provide a hardcopy free of charge on request, if you contact the Fund Administrator on For further information: P am to 5.00pm weekdays (AEST) M The Fund Administrator Elphinstone Group Superannuation Fund PO Box 1442 Parramatta NSW 2124 W E egsfsuperadmin@linksuper.com 12

18 How super works Superannuation is an important part of financial planning for your working life and your retirement. Membership of the Fund is a joint commitment to your future, made between you and the Company. This guide provides additional information on how the Elphinstone Group Superannuation Fund and your superannuation work. Contributing to your superannuation Contributions to your superannuation account can come from a number of sources. Company contributions The Company contributes to the Fund on your behalf at a rate equal to the Superannuation Guarantee (SG) minimum. This rate is currently equal to 9.5% of your Ordinary Time Earnings (OTE). All employees will be entitled to receive this as the minimum Company contribution. Member contributions As an employee member, in addition to Company contributions, you can make additional voluntary contributions to your superannuation. You can make contributions from either your before-tax salary via salary sacrifice, (known as concessional contributions ) or after-tax salary (known as non-concessional contributions ). There are different tax implications depending on the type of contributions you make. For example, if you contribute from your before-tax salary, you are effectively reducing your taxable salary, which means you ll pay less income tax. Before-tax contributions are deducted from your gross salary and, along with Company contributions, are treated as concessional contributions for tax purposes, which means contributions tax must be paid. Whether this suits you depends on your personal circumstances. See page 14 for How super is taxed. If you contribute from your after-tax salary, no further tax is deducted from these contributions, as you have already paid income tax on your salary, provided your after-tax contributions are within the non-concessional contributions cap (see pages 14 to 15 for more information on tax). Extra tax applies to contributions above this cap. You may be able to claim a tax deduction for after-tax contributions you make. If you do so, you must give the Trustee a Notice of intent to claim or vary a deduction for personal super contributions form which must reach the Trustee by 30 June in the financial year you intend to claim the deduction. A copy of the form is on the Fund s website. Your before-tax contributions, together with Company contributions and any contributions for which you claim a tax deduction, are subject to the concessional contributions cap. Extra tax applies to contributions above this cap. If you are considering making before-tax or deductible contributions, you may wish to check with your Payroll Office to ensure that your intended contributions are below the cap. As everyone s situation is different, you should also consider seeking financial advice. You should note that once contributions are made to the Fund they generally cannot be returned to you until retirement or until you satisfy another special condition, see page 3. You can change your contribution choice at any time by completing the Application & Change form which is available from the website at or the Fund Administrator.? Concessional contributions include those made to your superannuation by the Company and any personal salary sacrifice contributions. Non-concessional contributions include after-tax contributions and certain contributions from non-salary sources, such as certain overseas transfers, contributions made for you by your spouse and excess concessional contributions not withdrawn from the superannuation system

19 Government co-contribution In 2017/18, if you make superannuation contributions from your after-tax salary and earn less than $51,813 a year, the Government will pay an extra contribution called a co-contribution of up to $0.50 to your superannuation fund for every $1 that you contribute. The maximum co-contribution payment is $500 for members earning less than $36,813 per year who make contributions of $1,000 or more. The maximum co-contribution payment of $500 reduces by 3.33 cents for every dollar of a member s income above $36,813 and phases out completely for those with an annual income of $51,813 or more. You cannot receive the co-contribution for contributions for which you claim a tax deduction. Other eligibility conditions also apply. The Australian Taxation Office (ATO) automatically determines your eligibility for the co-contribution after the end of each financial year once you have lodged your personal income tax return. If you are eligible, the ATO makes the relevant co-contribution payment to the Fund on your behalf. Comparing contributions Before-tax After-tax Income tax paid on your contributions 15% contributions tax Benefits tax applies if your benefit is paid before age 60 Government co-contribution may be available Rollovers You can transfer any other superannuation benefits you may have from another superannuation fund into the Elphinstone Group Superannuation Fund. This is called a rollover. Any amount you transfer is paid into your account in the Fund and will be invested in the same way as your Company and member contributions. Your rollovers, along with investment earnings, will be paid in addition to your main benefits when you leave the Fund. The Fund doesn t charge you to roll over money from other funds. You should, however, check if the other funds charge an exit fee, or if you will lose any important benefits such as insurance should you roll over your money out of that fund. If you want to make a rollover, please complete the Rollover form at the back of this guide. If you would like additional copies of the form, you can download a copy from or call the Fund Administrator on Preservation rules Your superannuation must be preserved in the superannuation system until you retire (or satisfy other special conditions). In other words, you can t take your superannuation money out to spend or invest in a non-superannuation plan. Generally, you can only take your benefit in cash when: You have reached age 65. You have reached age 60 and either ceased gainful employment after reaching that age or the Trustee is satisfied that you intend never again to be gainfully employed for more than 10 hours per week. You have retired from the workforce and reached your preservation age and the Trustee is satisfied that you intend never again to be gainfully employed for more than 10 hours per week. You satisfy special conditions and are allowed to have your preserved benefits released earlier, for example, in the event of total and permanent disability, a terminal medical condition, severe financial hardship or on compassionate grounds. You leave Australia permanently if you are a temporary resident (excluding a New Zealand citizen) and satisfy certain conditions. Your benefit may include an unrestricted non-preserved amount, a restricted preserved amount and a preserved amount. Any unrestricted non-preserved amount can be paid to you in cash at any time. It usually comprises the non-preserved portion of certain rollovers from other superannuation funds. Any restricted non-preserved amounts can be paid to you in cash when you stop working with your current employer. Your preservation age depends on when you were born, as shown in the table on the next page. 3

20 Preservation age Date of birth Preservation age Before 1 July Between 1 July 1960 and 30 June Between 1 July 1961 and 30 June Between 1 July 1962 and 30 June Between 1 July 1963 and 30 June After 30 June If you don't keep your superannuation in the Retained Benefits Division, any benefits that have to be preserved must be rolled over to a complying fund if you leave (see page 17 for more information). Your annual Personal Statement of Benefits will tell you how much (if any) of your superannuation is preserved. Choice of Fund and Portability Temporary residents If you are not an Australian or New Zealand citizen or resident and you accrued superannuation while in Australia on a temporary resident visa, you may be able to claim your superannuation when you return home. Applicable taxes will be deducted (these may be different to the taxes paid by other Fund members on their superannuation). If you do not claim your superannuation within six months of permanently departing Australia, the Trustee may be required to pay your superannuation to the ATO without your consent. You may then claim your superannuation from the ATO, but it may not earn any interest while with the ATO. Choice of Fund legislation allows most working Australians to choose which superannuation fund they want to belong to. As an employee of Elphinstone Group (Aust) Pty Ltd or an approved participating employer of the Elphinstone Group Superannuation Fund, you can participate in Choice of Fund and choose a complying fund other than this Fund for the superannuation contributions the Company makes on your behalf. It s important to keep in mind that Choice of Fund is optional. If you do not make a choice, Elphinstone Group (Aust) Pty Ltd will pay Company contributions to its default MySuper fund, which is this Fund. If you are considering choosing another superannuation fund, it s important that you first consider the possible implications of doing so on your superannuation, particularly your insurance cover which is an important part of your membership of this Fund. Your existing balance: If you want to choose another fund, your account will be automatically transferred to the Fund s Retained Benefits Division if it is more than $5,000 or to an Eligible Rollover Fund if it is less. (See pages 16 and 17 for more information.) Insurance: Your disablement insurance cover will cease immediately, and you will need to make your own arrangements, at your own cost, for disability cover, but your death and terminal illness insurance cover may continue in the Retained Benefits Division. However, if you choose another fund when you first commence employment, you will not be entitled to any automatic insurance cover in this Fund. See page 17 for more information on your insurance cover in the Retained Benefits Division. Fees: You should check the fees of any fund you are considering. Transfers out of the Fund: If you wish to make a partial benefit transfer to another fund, you must retain a minimum balance of $5,000 in this Fund. To transfer your existing balance you will need to complete a Transfer Request Form, which is available from the Fund Administrator. Transferring part of your account balance to another superannuation fund, (as opposed to redirecting your full account balance to another fund) does not affect your membership or insurance entitlements in the Fund provided there is enough money in your account to pay the insurance fees. Returning to the Fund: Once you have transferred your full benefit from the Fund, or if you chose another fund when you first commenced employment, you can rejoin the Fund at any time. However, you should keep in mind that you will not automatically be provided with insurance cover and will have to provide evidence of good health and be assessed and accepted by the insurer before any cover commences. For more information about Choice of Fund and portability, call the Fund Administrator on

21 Benefits of investing with the Elphinstone Group Superannuation Fund How your account works General reserve The Fund provides accumulation-style benefits. This means that your benefits in the Fund accumulate over time with Company contributions and any member contributions that you make to your superannuation. Investment earnings (which can be positive or negative) are also applied to your superannuation account, while taxes, fees and fees for insurance cover are deducted from it to give you a closing balance. Investment earnings (net of investment fees, tax and percentage-based administration fees) are applied to your benefits once a year at the final rate of your chosen investment option(s). The Fund s investment returns may also be reduced for an allowance to maintain the Fund s Operational Risk Financial Requirement reserve if required. Remember that the investment earnings on your superannuation can be positive, increasing the value of your superannuation, or negative, decreasing the value of your superannuation. Your superannuation account in the Fund will look like this: Tax Administration fees Insurance fees Other fees Opening balance + Company contributions Member contributions Rollovers +/ The Trustee maintains a general reserve, which is used over time to finance certain expenses. The general reserve is invested in the Balanced (MySuper) option. The level of reserve for the last three years is included in the Fund s Annual Report. Deferred tax assets Superannuation funds normally pay tax on capital gains. If the Fund experiences capital losses (which can arise, for example, due to falls on share markets), superannuation funds are allowed to accumulate the tax benefits associated with those losses and use them to offset the tax on future capital gains. The Fund may hold some capital losses from time to time. Australian Accounting Standards require that future tax benefits are recognised only to the extent that it is likely that future taxable gains will be available to utilise the capital losses. In order to prudently manage the Fund s tax position, the Trustee has imposed a limit on the level of taxation benefits arising from such capital losses. Where capital losses are below this limit, the calculation of investment earnings may be adjusted. Investment earnings = Closing balance The Fund has four different investment options for you to choose how your superannuation is invested. If you don t choose an option, your superannuation is invested in the Balanced option. This is the option for MySuper members. You can split your superannuation balance across the four different investment options. The Investment Guide at has more information. Each year, details of the investment earnings applied to your superannuation account, as well as details of any deductions from your account, are shown on your Personal Statement of Benefits. 5

22 Your superannuation benefits You are entitled to a benefit when you: Retire; Leave the Company; Become totally and permanently disabled; or Die (paid to your dependants and/or estate). In certain circumstances a benefit may also be payable if you leave the Fund as a result of a terminal illness. What is my leaving service benefit? If you retire or leave the Company for any reason (other than death or disablement) you will be entitled to receive a leaving service benefit. This benefit is equal to your Total Account Balance. However, all or part of your benefit may need to be preserved in accordance with superannuation legislation (see pages 3 to 4 for details). What additional benefits are paid if I die or become totally and permanently disabled? If you die while you are a member of the Fund, a lump sum is payable to your dependants or your estate. This benefit is equal to the sum of your Total Account Balance and your insured benefit (if any). If you become totally and permanently disabled, a lump sum is also payable, if you are eligible. For details of your insurance refer to the Insurance Guide available from the website at com.au. Payment of your death benefit On joining the Fund you complete an Application & Change form, advising the Trustee to whom, and in what proportion, you would like your death benefit to be paid. If you prefer, or if you have no dependants, you may nominate your estate. In that case, the benefit will be distributed according to your Will, so it is important that you keep your Will up-to- date, especially if your circumstances change, such as a divorce, a new child or a marriage. Your nomination can be changed at any time by completing an Application & Change form available from the website at com.au. You can choose to make your nomination binding on the Trustee, or you can make a non-binding nomination. A binding nomination obliges the Trustee to pay your death benefit according to your stated wishes (provided the nomination is valid at the time of your death). Binding nominations have a fixed term of three years and can provide you with greater certainty about the payment of your benefit. However, it is your responsibility to update your binding nomination if your personal circumstances change (e.g. if you marry or have a child) or when your nomination expires. A non-binding nomination is not legally binding and has no fixed term but will act as a guide for the Trustee, who will investigate your circumstances at the time of your death and take your wishes into account when making its decision. When deciding who should receive your death benefit, remember that current Superannuation Law and the Fund s Trust Deed generally allow it to be paid to: Your personal legal representative (your estate); Your current spouse (including a de facto partner of either sex with whom you live on a genuine domestic basis); Your children (including step children, adopted children, your spouse s children and unborn children); Any person who is financially dependent on you; or Any person with whom you have an interdependency relationship. An interdependency relationship is where: 1. Two people have a close personal relationship; 2. They live together; 3. One or each of them provides the other with financial support; and 4. One or each of them provides the other with domestic support and personal care. However, if two people have a close personal relationship and either one, or both, suffers from a physical, intellectual or psychiatric disability, then they are still considered to have an interdependency relationship for the purposes of the Law and are not required to fulfil the other three criteria. The Law includes details of various matters that the Trustee must consider in deciding whether two people have an interdependency relationship. Your parents, brothers or sisters are unlikely to be dependants under the Law. To be dependants, they would have to rely on you for financial support or be in an interdependency relationship with you. If you don t have any dependants, you should nominate your estate. Whatever type of nomination you choose, it is important that you keep your nominated beneficiaries up-to-date, especially if your circumstances change. If you would like to make a nomination or change your current nomination, you will need to complete the Application & Change form available on the Fund s website at elphinstonegroupsuperfund.com.au.? About binding nominations Valid for three years, they must then be renewed. Generally only valid if you nominate a dependant (as outlined) or your legal personal representative. It is your responsibility to ensure your nomination is up-to-date. The Fund will advise you when your nomination is due to expire

23 Family Law and your superannuation Your superannuation can generally be split as part of a property settlement in the event of your divorce or separation. The Trustee will be required to split your benefit if it receives a Court Order or an agreement between you and your former spouse. If your superannuation is split, your account will be reduced. If this affects you, you will be advised of how your benefit will be reduced. Any current applicable activity fees are shown in Fees and other costs (see pages 9 to 13). For more information about the Family Law legislation and how it may affect your superannuation, contact the Fund Administrator on Bankruptcy and your superannuation Any personal contributions to superannuation made on or after 27 July 2006 (excluding the Company s SG contributions) may be recoverable by creditors in the event of your bankruptcy if these contributions are demonstrated to have been made with the specific intention of defeating creditors. You will be advised if this affects you. 7

24 Risks of super There are certain risks associated with membership of the Fund. Some of the risks are common to all superannuation funds. For example, there is the risk that the Fund will close or wind up. If that were to happen, the Trust Deed determines how the Trustee must react. Changes are frequently made to Superannuation Law, which may affect a member s ability to access their superannuation benefits. You will be advised of any changes that may affect your benefits in the Fund. Changes can also occur to the taxation of superannuation or income, which may affect the value of your superannuation benefits or the net benefit paid. Another risk is that the Fund may lose its compliance status and therefore lose its tax concessions. The Trustee manages this risk by ensuring that the Fund is administered professionally, that it operates in accordance with the requirements of the Trust Deed and Law, and the Trustee uses the services of a professional consulting firm to keep up-to-date. For more information on investment risks, please see the Investment Guide. For more information on insurance risks, see the Insurance Guide. Both documents are available from the website at elphinstonegroupsuperfund.com.au

25 Fees and other costs DID YOU KNOW? Small differences in both investment performance and fees and costs can have a substantial impact on your long-term returns. For example, total annual fees and costs of 2% of your fund balance rather than 1% could reduce your final return by up to 20% over a 30-year period (for example, reduce it from $100,000 to $80,000). You should consider whether features such as superior investment performance or the provision of better member services justify higher fees and costs. You or your employer, as applicable, may be able to negotiate to pay lower fees. Ask the fund or your financial adviser. TO FIND OUT MORE If you would like to find out more, or see the impact of the fees based on your own circumstances, the Australian Securities and Investments Commission (ASIC) website ( has a superannuation calculator to help you check out different fee options. This section shows fees and other costs that you may be charged. These fees and other costs may be deducted from your money, from the returns on your investment or from the assets of the superannuation fund as a whole. Other fees, such as activity fees and insurance fees may also be charged, but these will depend on the nature of the activity or insurance chosen by you. Taxes, insurance fees and other costs relating to insurance are set out in another part of this document. Please note that the Trustee has already negotiated (and will continue to monitor) the fees and management costs of the Fund on your behalf. There is no scope to negotiate lower fees and management costs on an individual basis. You should read all the information about fees and other costs because it is important to understand their impact on your investment. 9

26 The fees and costs for the MySuper option and each investment option offered by the Fund are set out below. Elphinstone Group Superannuation Fund Type of fee Amount How and when paid Investment fee 1 Growth option 0.20% p.a. to 0.30% p.a. ($2.00 to $3.00 per $1,000) Balanced (MySuper) option 0.20% p.a. to 0.30% p.a. ($2.00 to $3.00 per $1,000) Deducted from monthly returns prior to the returns being credited to your account. Administration fee Conservative option 0.20% p.a. to 0.30% p.a. ($2.00 to $3.00 per $1,000) Cash option 0.10% p.a. to 0.15% p.a. ($1.00 to $1.50 per $1,000) $410 $460 p.a. plus 0.30% p.a. ($3.00 per $1,000) The dollar fee is deducted from your account at the end of each month and on leaving the Fund. The percentage-based fee is deducted from monthly returns prior to the returns being credited to your account. The amounts shown are estimates. Buy-sell spread Nil for amounts switched less than $250,000 Growth option 0.24% of the amount switched ($2.40 per $1,000) Balanced (MySuper) option 0.17% of the amount switched ($1.70 per $1,000) Deducted from your account when you change your investment option(s), if applicable (based on the option you switch into). Conservative option 0.19% of the amount switched ($1.90 per $1,000) Cash option Nil Switching fee $50 Deducted from your account each time you change investment options. Exit fee Advice fees relating to all members investing in a particular MySuper product or investment option Other fees and costs 2 $772 members whose Fund benefits are transferred to the new superannuation provider at the transfer date* $ members who withdraw or transfer their entire account balance to another superannuation fund before the transfer date* $ members who make a partial withdrawal or partial transfer to another superannuation fund from their account balance before the transfer date* Nil Other fees may also apply Deducted from your account when you leave or are transferred from the Fund or when you withdraw money from the Fund. If you have been in the Fund for two years or less as at the transfer date* and your Fund benefits are transferred to the new superannuation provider at the transfer date, the Company will make an additional contribution of $772 to cover your exit fee. Not applicable. Indirect cost ratio Nil Not applicable. 1 Includes transactional and operational costs. 2 Insurance fees and fees for certain activities you request may apply (see pages 11 to 13). * This is the date that the Fund will be closed and members will be transferred to another superannuation provider see Fund closure announcement and Q&As at for more information

27 Example of annual fees and costs for the Balanced (MySuper) option This table gives an example of how the fees and costs in the Balanced (MySuper) option for this superannuation product can affect your superannuation investment over a one year period. You should use this table to compare this superannuation product with other superannuation products. EXAMPLE Balanced (MySuper) option BALANCE OF $50,000 Investment fees 0.30% p.a. ($3.00 per $1,000) For every $50,000 you have in the superannuation product you will be charged $150 each year* PLUS Administration fees PLUS Indirect costs for the Balanced (MySuper) option EQUALS Cost of product $460 p.a. plus 0.30% p.a. ($3.00 per $1,000) Nil And, for every $50,000 you have in the superannuation product you will be charged $150 each year* in administration fees plus $460 per year regardless of your account balance And, indirect costs of nil each year will be deducted from your investment If your balance was $50,000, then for that year you will be charged fees of $760 for the superannuation product * The top of the fee range is quoted on a gross of tax basis. The dollar fee shown would apply only if the maximum estimated fee applies. The percentage-based fee is an estimate only. Where the Trustee claims a tax deduction for fees, the full benefit will be passed to members via a positive adjustment to investment earnings. Note: Additional fees may apply. And if you leave the superannuation fund, you may also be charged an exit fee (see page 10 for the amount) and a buy-sell spread which also applies whenever you make an investment switch of $250,000 or more. The buy-sell spread for exiting is nil. Additional explanation of fees and costs 1. Buy-sell spread A buy-sell spread may be charged by a fund to reflect costs incurred by the fund or charged by the Investment Managers when you change investment options. The buy-sell spreads shown in the table on page 10 are charged to recover costs incurred by the Fund s Investment Managers when you change investment options, including the difference between the acquisition and disposal prices paid by the Managers for the Fund s investments. Buy-sell spreads are only charged for changing investment options where the amount switched is $250,000 or more and are based on the option you transfer into. Any buy-sell spread is in addition to the switching fee which also applies when you change investment options. 2. Administration fees These fees include administration, consulting, audit, legal and other fees incurred by the Fund. The dollar fee is deducted from your account at the end of each month and when leaving the Fund. The percentage-based fee is deducted from monthly investment returns earned by your chosen option(s) before the returns are applied to your accounts and is an estimate only. 3. Investment fees The investment fee ranges that apply to the Fund s investment options are shown in the table on page 10. Where the Trustee claims a tax deduction for investment fees and indirect costs, the full benefit of this deduction is passed to members. 4. Taxes and insurance fees The following taxes and insurance fees are deducted from your accounts in the Fund: The fee for your insurance cover, generally based on an age-based scale and the level of cover you have chosen. For details, refer to the Insurance Guide. Contributions tax generally at the rate of 15% from Company contributions and any salary sacrifice contributions to your accounts. Excess contributions tax in certain circumstances if your contributions exceed caps set by the Government (see page 14). No-TFN tax on your concessional (employer and before-tax) contributions if you have not provided the Fund with your TFN. Any surcharge tax assessed by the ATO as being applicable to you. The tax is deducted from your accounts when the assessment is received by the Fund. The surcharge was abolished with effect from 1 July 2005, but the Fund may still receive assessments for you in respect of earlier years. Any Division 293 tax in certain circumstances. More information on tax can be found on page

28 5. Transactional and operational costs These costs are incurred by the Fund and its Investment Managers, and may include brokerage, settlement and custody costs, the difference between the acquisition and disposal prices paid by the Managers for the Fund s investments, clearing costs, costs associated with currency hedging and stamp duty on investment transactions. Part of these costs is recovered by the buy-sell spread charged when you switch $250,000 or more between investment options. The remaining transactional and operational costs are included in the investment fee based on the amount of these costs incurred by the Fund or its Investment Managers during the financial year to 30 June They therefore represent a cost to you. The percentage included in the investment fee in the table on page 10 in respect of transactional and operational costs is: Growth option 0.03% p.a. Balanced (MySuper) option 0.06% p.a. Conservative option 0.10% p.a. Cash option Nil These amounts are estimates. To the extent they are part of the investment fee, these costs are deducted from the investment earnings of each investment option before those earnings are applied to your accounts. 6. Reserves Superannuation funds are required to set aside financial resources to address their operational risks. The Trustee has built up an operational risk financial requirement reserve (ORFR reserve) in the Fund equal to 0.25% of net assets funded by setting aside a small portion of the Fund s investment earnings. The reserve is invested in the Balanced (MySuper) option. The Trustee periodically monitors the reserve to ensure that it remains close to its target level. Should the reserve fall below a predetermined shortfall limit, the Trustee will enact a plan for its replenishment. This may include deducting further amounts from investment earnings. Any such deductions will be included in the investment fee of each investment option. Members will be advised if such deductions are required. The Trustee also maintains a general reserve, which is used over time to finance certain Fund expenses. The general reserve is also invested in the Balanced (MySuper) option. The level of reserves for the last three years is included in the Fund s Annual Report. 7. Activity fees If you or your spouse require information on your benefit in relation to a Family Law matter, a fee of $220 will be charged for each date at which information is required. You, or your spouse, are required to pay this fee at the time of any request for information it is not deducted from your accounts. In addition, if your superannuation is split under a Family Law agreement or court order, fees will apply for the splitting of your superannuation and the payment of an amount to your former spouse. These fees are normally shared evenly between you and your former spouse, unless your agreement or court order provides otherwise. The fees may be paid by you and/ or your spouse by cheque, or otherwise will be deducted from the applicable benefit. The fee for establishing an entitlement to your spouse is $165. All fees include GST where applicable. 8. Fee changes Some of the fees are dependent on the fees charged by the Fund s service providers. Some of these fees may be indexed annually (e.g. in line with increases in Average Weekly Ordinary Time Earnings); others depend on the services provided to the Fund each year. The Trustee reserves the right to increase the fees without your consent if necessary in order to manage the Fund. We may also introduce new fees. You will generally be given at least 30 days notice of any fee increases. The fees shown are current at the date of this PDS, unless otherwise stated. Further details of the fees, costs and taxes paid by the Fund can be found in the Fund s Financial Statements. A summary is included in the Fund s Annual Report which is issued after 30 June each year

29 Fee definitions Activity fees A fee is an activity fee if: (a) the fee relates to costs incurred by the trustee of a superannuation fund that are directly related to an activity of the trustee: (i) that is engaged in at the request, or with the consent, of a member; or (ii) that relates to a member and is required by law; and (b) those costs are not otherwise charged as an administration fee, an investment fee, a buy-sell spread, a switching fee, an exit fee, an advice fee or an insurance fee. Administration fees An administration fee is a fee that relates to the administration or operation of the superannuation fund and includes costs that relate to that administration or operation, other than: (a) borrowing costs; and (b) indirect costs that are not paid out of the superannuation fund that the trustee has elected in writing will be treated as indirect costs and not fees, incurred by the trustee of the fund or in an interposed vehicle or derivative financial product; and (c) costs that are otherwise charged as an investment fee, a buy-sell spread, a switching fee, an exit fee, an activity fee, an advice fee or an insurance fee. Advice fees A fee is an advice fee if: (a) the fee relates directly to costs incurred by the trustee of a superannuation fund because of the provision of financial product advice to a member by: (i) a trustee of the fund; or (ii) another person acting as an employee of, or under an arrangement with, a trustee of the fund; and (b) those costs are not otherwise charged as an administration fee, an investment fee, a switching fee, an exit fee, an activity fee or an insurance fee. Buy-sell spreads A buy-sell spread is a fee to recover transaction costs incurred by the trustee of a superannuation fund in relation to the sale and purchase of assets of the fund. Exit fees An exit fee is a fee to recover the costs of disposing of all or part of members interests in the superannuation fund. Insurance fees A fee is an insurance fee if: (a) the fee relates directly to either or both of the following: (i) insurance premiums paid by the trustee of a superannuation fund in relation to a member or members of the fund; (ii) costs incurred by the trustee of a superannuation fund in relation to the provision of insurance for a member or members of the fund; and (b) the fee does not relate to any part of a premium paid or cost incurred in relation to a life policy or a contract of insurance that relates to a benefit to the member that is based on the performance of an investment rather than the realisation of a risk; and (c) the premiums and costs to which the fee relates are not otherwise charged as an administration fee, an investment fee, a switching fee, an exit fee, an activity fee or an advice fee. Investment fees An investment fee is a fee that relates to the investment of the assets of a superannuation fund and includes: (a) fees in payment for the exercise of care and expertise in the investment of those assets (including performance fees); and (b) costs that relate to the investment of assets of the fund, other than: (i) borrowing costs; and (ii) indirect costs that are not paid out of the superannuation fund that the trustee has elected in writing will be treated as indirect costs and not fees, incurred by the trustee of the fund or in an interposed vehicle or derivative financial product; and (iii) costs that are otherwise charged as an administration fee, a buy-sell spread, a switching fee, an exit fee, an activity fee, an advice fee or an insurance fee. Switching fees A switching fee for a MySuper product is a fee to recover the costs of switching all or part of a member s interest in a superannuation fund from one class of beneficial interest in the fund to another. A switching fee for superannuation products other than a MySuper product, is a fee to recover the costs of switching all or part of a member s interest in the superannuation fund from one investment option or product in the fund to another. Indirect cost ratio The indirect cost ratio (ICR), for a MySuper product or an investment option offered by a superannuation fund, is the ratio of the total of the indirect costs for the MySuper product or investment option, to the total average net assets of the superannuation fund attributed to the MySuper product or investment option. 13

30 How super is taxed The information that follows is current at the date of publication of this document, unless otherwise noted. A number of taxes may apply to your superannuation. These include: Contributions tax generally at the rate of 15%, which is deducted from all concessional contributions. If you have not provided your Tax File Number to the Fund, the rate of tax that applies to concessional contributions increases substantially to 47%. If your relevant income is over $250,000 you may receive an additional tax assessment from the Australian Taxation Office (ATO), for a further 15% tax on your concessional contributions. Tax on investment earnings at up to 15% less any applicable deductions that may be available to the Investment Managers or the Fund. This tax is deducted from the Fund s investment earnings before they are applied to your account. Excess contributions tax may apply if your contributions exceed certain caps set by the Government (see to the right for more information). Tax on benefits that are paid in cash. The amount of tax payable depends on a number of factors including: What type of benefit is paid (retirement, disability or death); Who receives the benefit; Whether you were an Australian citizen or permanent resident when the benefit is paid. Former holders of certain temporary resident visas may pay more tax on their benefits; How you receive the benefit (e.g. lump sum amount or pension); and Your age when you receive the benefit. For example, if you are aged 60 or over, all lump sum payments and pensions paid to you from a taxed superannuation fund (such as the Elphinstone Group Superannuation Fund) will be tax-free. If you are less than age 60, any lump sum amounts paid to you will consist of two tax components a tax-free component and a taxable component. All taxes deducted are paid to the ATO when required. Tax limits The Government sets limits or caps that affect how superannuation contributions and benefits are taxed. What are the caps on contributions? These are the Government s limits or caps on how much can be contributed to superannuation each year before extra tax applies. What is the annual limit? What tax applies if my contributions are within the cap? Concessional contributions $25,000 regardless of your age. Generally 15% contributions tax.*^ Non-concessional contributions # $100,000, however, if your total superannuation balance on 30 June 2017 was more than $1.6 million any non-concessional contributions you make in the 2017/18 year will be excessive. Nil. # If you are under age 65 and you want to make larger non-concessional contributions to your superannuation fund, you may be able to bring forward up to two years of caps, to make total contributions of up to $300,000 over three years. The maximum you can contribute over three years is $300,000 and further restrictions may apply if your total superannuation balance on 30 June 2017 was greater than $1.4 million. Transitional rules apply if you brought forward contributions in the 2015/16 or 2016/17 years. * If your relevant income is over $250,000 per year, you may receive an additional tax assessment from the ATO. ^ If you earn less than $37,000 per year you may receive a refund of the 15% contributions tax deducted from your compulsory Company contributions through the low income superannuation tax offset. The refund ranges from $10 to $500 a year. Each year the ATO will determine whether you are eligible, and if so, will pay the refund to your superannuation fund

31 What are concessional contributions? Concessional contributions include Company contributions and any contributions you make to superannuation from your before-tax salary (i.e. by salary sacrifice), or a personal contribution for which you claim a tax deduction. What are non-concessional contributions? Non-concessional contributions include: After-tax contributions for which you have not claimed a tax deduction; Excess concessional contributions not withdrawn from superannuation; and Certain other contributions from non-salary sources (e.g. contributions made for you by your spouse and certain overseas transfers). They do not include rollovers or co-contributions. What happens if I exceed the caps? This table shows the extra tax applicable if you exceed the caps: Providing your Tax File Number Providing your Tax File Number (TFN) to your superannuation fund is not compulsory; however, doing so ensures that you don t pay any more tax on your contributions than you need to. Significant consequences apply to members of superannuation funds who have not advised their superannuation fund of their TFN. These include: Taxing their concessional (employer, deductible and before-tax) contributions at up to 47% (including Medicare levy); and Prohibiting superannuation funds from accepting any non-concessional contributions from these members. If you have not previously provided your TFN to your employer and you wish to do so, contact your Payroll Office to obtain the appropriate form. On receipt of your completed form, your employer will then pass this information onto the Fund within 14 days. How much tax applies to the excess if I exceed the limit? Concessional contributions Your marginal tax rate less 15% (reflecting tax already paid by the Fund), plus an interest charge. Non-concessional contributions If you withdraw the excess from superannuation: Nil tax on contributions. Associated earnings taxed at your marginal tax rate. If you leave the excess in superannuation: 47% (including Medicare levy). If you exceed the concessional contributions cap, you can elect to release up to 85% of the excess contributions from the superannuation system. The amount will be paid by your superannuation fund to the ATO and used to meet any of your outstanding tax liabilities (including the tax on the excess contributions) with the remainder then paid back to you. Amounts that you withdraw will not count towards your non-concessional contributions cap. If you exceed the non-concessional contributions cap, you can elect to release the excess contributions from superannuation, together with an amount of associated earnings. The amount of associated earnings is determined by the ATO and may not reflect what your superannuation contributions actually earnt. The ATO will send you a form to enable you to make your elections. 15

32 Leaving employment Your options when you leave the Company When you leave the Company, you will receive a statement showing the balance in your superannuation account and the options you have for your superannuation here is a summary: Retain your benefits in the Fund If you leave the Company and have more than $5,000 in the Fund, your superannuation will be transferred automatically into an account in your name in the Fund s Retained Benefits Division (see page 17) until you instruct the Fund Administrator otherwise. When you leave the Company, if your superannuation balance is less than $5,000, you will have 90 days in which to instruct the Fund Administrator how you would like your benefit to be paid. Your superannuation will remain fully invested in your chosen investment option(s) (or the Balanced option, which is the option for MySuper members, if you have never made an investment choice) for the 90 day period or until you notify the Fund. The Trustee may roll your benefit over to an Eligible Rollover Fund (ERF) if: You fail to give the Fund Administrator instructions within 90 days of receiving details of your benefit; or The superannuation fund you nominate won t accept your benefit. The ERF is: AMP Eligible Rollover Fund PO Box 300 Parramatta NSW 2124 Phone: Contact: The Administrator Once your benefit is transferred to the ERF, you stop being a member of the Elphinstone Group Superannuation Fund and no longer have any rights under the Fund. You will then need to contact the ERF directly about your benefit. You can also obtain the ERF s Product Disclosure Statement using the contact details above. The investment and crediting rate policy of the ERF may be different to those that applied in the Fund. Also, the ERF may not offer any insurance cover. You should seek advice from a licensed Financial Adviser about whether the ERF is a suitable investment for you. Roll over to another superannuation fund You can roll your superannuation into another fund of your choice, providing it is a complying superannuation fund under Law. Take a cash payment You can take any unrestricted non-preserved amount (refer to your Personal Statement of Benefits) in cash, net of tax. If you are under age 60, tax may apply to the taxable component of this amount (if any). For partial payments, the tax components of the payment will be in proportion to your total benefit. You cannot choose, for example, to withdraw only your tax-free component. Amounts paid by the Fund to members aged 60 or over are tax free. Apply for an Account-Based Pension The Fund offers a retirement Account-Based Pension and a Transition to Retirement Pension which provide members with regular pension payments at or near retirement. Your superannuation is invested in an account which receives investment returns based on your chosen investment option(s). Regular pension payments are made within limits set by the Government. Payments continue until the balance in your account runs out. If you are retired or over age 65 you are also able to make lump sum withdrawals. If you apply for a Transition to Retirement Pension, you are able to continue working and receive a regular income from your superannuation. To be eligible for either Pension you need to be over your preservation age and have at least $15,000 in superannuation to invest. For more details on either Pension, refer to A Guide to your Account-Based Pension, which is available from the Fund s website at com.au

33 The Fund s Retained Benefits Division The Retained Benefits Division (RBD) is a section of the Fund for members who are no longer employed by Elphinstone Group (Aust) Pty Ltd or participating companies, but who would prefer to leave their superannuation invested in the Fund rather than transfer it to another complying superannuation fund. How do I become a member? If you have more than $5,000 in your superannuation account, you will automatically become a member of the Fund s RBD when you leave the Company. If you do not want to keep your superannuation in the Fund, you can transfer your savings to another complying superannuation fund of your choice. How does it work? Your account in the RBD works in a similar way to your current account in the Fund. Once your superannuation is transferred to your new RBD account, it will continue to be invested in your chosen investment option(s). Your superannuation will accumulate with investment returns each year, which may be positive or negative. Taxes and any applicable fees will be deducted from your account (refer to the Fees and other costs section on pages 9 to 13 for more information on the fees that apply). Each year you will receive a Personal Statement of Benefits showing your account balance and any transaction details, together with a copy of the Fund s Annual Report. How long will my superannuation remain in the RBD? You can leave your superannuation invested in the RBD for as long as you like. What else should I know about being a member of the RBD? Voting rights you cannot be nominated as a Trustee Director. Death insurance your death only and terminal illness insurance (including any voluntary insurance, if applicable) continues in the RBD. On your cessation of employment with Elphinstone Group (Aust) Pty Ltd or participating companies, or if you direct your SG contributions to another fund, the amount of your insurance will be calculated. On your automatic transfer to the Fund s RBD, this will be the amount of your insurance cover. The fees for the insurance cover will be the same as for additional voluntary insurance (see the Insurance Guide) and are deducted from your account. You can reduce or opt out of your cover at any time by writing to the Fund Administrator. Note that there is no disablement insurance cover in the RBD. If you die if you die while a member of the RBD, the balance in your account plus your insurance cover (if any) will be paid to your dependants and/or your estate. See page 6 for information about nominating beneficiaries. Can I transfer other amounts into my RBD superannuation account? Yes, you can make personal contributions and lump sum rollovers into your account in the RBD at any time. No rollover fee applies. However, regular employer contributions (including salary sacrifice contributions) cannot be accepted into this account. 17

34 How to open an account Joining the Elphinstone Group Superannuation Fund is easy! Just follow these simple steps. 1. Read this PDS carefully to learn about the options and features available to you. 2. Consider your superannuation choices for: Additional voluntary contributions; Rollovers; Your investment choice; Your insurance cover; and Your beneficiaries. Once you have made your choices, complete and return the Application & Change form, Rollover form and Application for additional voluntary insurance cover. How the Fund is managed The Elphinstone Group Superannuation Fund has been established to provide superannuation benefits for members and their dependants. Its operation is governed by a legal document known as the Trust Deed (see to the right). As a member of the Fund, you are bound by the terms and conditions set out in the Trust Deed. The Trustee of the Fund is Elphinstone Group Superannuation Pty Ltd (ABN ). The Board of Directors comprises an equal number of member-elected and Company-appointed Directors. The rules governing the appointment and removal of member-elected Directors are available from the Fund Administrator or on the website. The Trustee is responsible for ensuring that: The overall operation of the Fund is conducted in accordance with the Trust Deed and relevant legislation; Your rights and interests as a member are protected; Benefits are paid correctly and on time; and The Fund's assets are invested properly. Professional independent advisers such as Investment Managers, Actuaries, Consultants and Auditors may be appointed to assist the Trustee in fulfilling its responsibilities. Service providers The Trustee may use the services of Towers Watson Australia Pty Ltd (Willis Towers Watson) (ABN , AFSL ) to provide general financial advice to members. The Trustee is not licensed to provide financial advice and any advice provided to members in writing, electronically, in person or via telephone will be provided by Willis Towers Watson not the Trustee. Willis Towers Watson is licensed to provide advice and the Trustee neither recommends nor endorses that advice. The Trust Deed The Trust Deed is a legal document that sets out the rights and duties of all employer participants, and outlines the rules under which the Fund is administered and benefits are paid. If there are any differences between this PDS and the Trust Deed, then the Trust Deed is the final authority. A copy of the Trust Deed is available on the website. Protecting your personal information To ensure that you receive the correct superannuation benefit and insurance, the Fund keeps precise records about you. This means that the Fund holds a considerable amount of information about you, such as your contact details, date of birth, Tax File Number, and salary and contribution information. Under the privacy legislation, you have the right to know what information the Fund holds about you. If you believe that the information the Fund holds about you is not accurate, complete or up-to-date, you are entitled to request that your information be amended. The privacy legislation also requires your consent before collecting certain personal information. The Trustee of the Fund believes your privacy is important and so has developed a privacy policy to protect your information. The policy outlines how the Fund collects and manages your personal information. A copy of the policy is available from the Fund Administrator and the website. If you would like to access or update your personal information, please contact the Fund Administrator. Providing proof of identity The Trustee is required to comply with the Government s Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) Legislation. Under the Legislation, the Trustee is required to verify a member s identity, and that of any other benefit recipients, before any benefit is withdrawn from the Fund. This verification process helps ensure that the Fund is not being used for money laundering, or funding terrorist or criminal activities. Withdrawals cannot be processed until the required proof of identity is supplied to the Fund Administrator. The Trustee may need to obtain additional identification information and verify your identity from time to time. It may have to disclose information about you to the regulator, the Australian Transaction Reports and Analysis Centre (AUSTRAC). If this happens, the Trustee is not permitted to inform you due to the sensitive nature of this information

35 Enquiries and complaints The Trustee has established a procedure for dealing with enquiries or complaints from members of the Fund or from beneficiaries. Initial enquiries and complaints should be addressed to the Fund Administrator (see page 1 for contact details). If you are not satisfied with the response you receive, there is a formal process through which the Trustee reviews enquiries and complaints. To make a formal complaint, please contact the Fund Administrator. The Trustee will respond within 90 days. In certain circumstances, you may be able to request the Trustee s reasons for its decision on your complaint. A copy of the Trustee s Enquiries and Complaints Policy is also available on the Fund website at com.au. Superannuation Complaints Tribunal If you are not happy with the Trustee s handling of your complaint, you may then contact the Superannuation Complaints Tribunal. The Tribunal is an independent body that has been set up by the Federal Government to deal with certain enquiries and complaints that the Trustee has not resolved to your satisfaction. You can contact the Tribunal on , or by to info@sct.gov.au. There are some complaints that the Tribunal cannot consider, such as those relating to the management of the Fund as a whole. In addition, time limits apply to certain complaints relating to total and permanent disability claims (where applicable) and to complaints about objections to the payment of death benefits. If your complaint is in relation to one of these areas, please contact the Fund Administrator or refer to the Tribunal s website at as soon as possible for further information. For privacy-related matters, the Office of the Australian Information Commissioner (OAIC) may review your complaint. You can contact the OAIC on or enquiries@oaic.gov.au. Member communication Keeping you informed The Fund keeps members informed about their superannuation: The Fund Administrator will answer your enquiries. Call ; For secure online access to your account information visit the website at Each year you receive an annual Personal Statement of Benefits showing your benefit entitlements; You will also receive an Annual Report along with newsletters should there be changes that may affect your superannuation; and If you leave the Company or the Fund you will receive further information about your benefit entitlements. Further information available As well as sending you annual information and answering your questions, further information is available on the website, including a copy of: The Trust Deed governing the Fund; The rules for appointing and removing member-elected Trustee Directors; The Fund s Privacy Policy; The Fund s Enquiries and Complaints Policy; and Additional copies of all parts of the PDS. Keep us informed To help with the smooth administration of your benefits, it s very important that you let us know if you change address or your personal details change. Call to advise us. 19

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38 Elphinstone Group Superannuation Fund 19 March 2018 Insurance Guide Contents Important information 1 Your insurance cover 2 Risks of insurance 4 Additional voluntary insurance 5 Issued by Elphinstone Group Superannuation Pty Ltd (ABN ), as Trustee of the Elphinstone Group Superannuation Fund (ABN ). MySuper Authorisation number

39 Important information The information in this document forms part of the Product Disclosure Statement (PDS) for the Fund s Accumulation section, dated 19 March This information should be read in conjunction with the other documents that form part of the Product Disclosure Statement. You should consider this information before making a decision about the relevant product. The information provided is general information only and does not take into account your particular objectives, financial circumstances or needs. It is not personal or tax advice. Any examples included are for illustration only and are not intended to be recommendations or preferred courses of action. You should consider obtaining professional advice about your particular circumstances before making any financial or investment decisions based on the information contained in this document. Neither the Trustee nor Elphinstone Group (Aust) Pty Ltd can provide you with financial advice. The Trustee will only provide factual information. Information on tax and superannuation legislation is current as at 1 July 2017, unless otherwise noted. The Trustee reserves the right to correct any errors or omissions. Information contained in this document that is not materially adverse is subject to change from time to time and may be updated if it changes. Updated information can be found at In addition, we will provide a hardcopy free of charge on request, if you contact the Fund Administrator on For further information: P am to 5.00pm weekdays (AEST) M The Fund Administrator Elphinstone Group Superannuation Fund PO Box 1442 Parramatta NSW 2124 W E egsfsuperadmin@linksuper.com 21

40 Your insurance cover The Elphinstone Group Superannuation Fund offers eligible members insurance cover to protect yourself and your family should the unexpected occur, for example, if illness or injury prevents you from working or in the event that you die. This document provides further information about the standard insurance and additional voluntary insurance cover available and the terms and conditions applicable to that cover. In this PDS, references to death cover include cover for terminal illness. The insurance amounts payable on death or disablement are met from one or more insurance policies taken out by the Trustee, and are subject to the terms and conditions of those policies. In the event of any differences between the information in this PDS and the insurance policies or the Fund s Trust Deed, the policies or Trust Deed, as applicable, prevails. The Fund offers insurance for death and total and permanent disablement (TPD). If eligible, your insurance benefit is paid in addition to the balance of your superannuation accounts on death and total and permanent disablement. You are entitled to receive standard insurance cover for death and total and permanent disablement if you are: A full-time employee; or A permanent part-time employee working at least 15 hours each week. Members over the age of 65 or members serving in the armed forces do not receive standard insurance cover unless advised otherwise in writing. Casual employees, contractors, employees working less than 15 hours per week and members of the Retained Benefits Division receive death only insurance cover and should refer to page 3 for details. Employed members aged 65 to 70 can opt to take out voluntary death only insurance cover see page 5 for details. If you take leave without pay, your cover will normally continue for up to two years provided you satisfy certain conditions. If you are intending to take leave without pay or to travel overseas for an extended period, you should confirm in advance that your insurance cover will continue. If you have chosen another fund for your contributions, including when you commenced employment with the Company, you may not have any insurance see Additional information about your superannuation for more information. What is my cover for death and disablement? If you are a permanent employee working at least 15 hours per week and are covered for insurance, you are entitled to receive insured benefits in addition to the balance of your superannuation account if you die or become totally and permanently disabled. Your insured benefit will be calculated as: 10.5% x Salary x future years and complete months to age 65 where Salary is equal to your weekly wage multiplied by the number of weeks in the year. Cost of cover The annual fees for standard death and disablement cover depend on your age as shown in the table to the right. Unless you opt out of all cover, the fees will be deducted from your superannuation account and the amount deducted will appear on your annual Personal Statement of Benefits. Do I need to provide evidence of my health? When you join the Fund, you will generally not be asked to provide the Fund s insurer with any evidence of good health. However, evidence of health will be required if you were not actively at work on the day you join the Fund, or if you did not join the Fund when first eligible (i.e. when you first commenced employment with the Company), or if your insurance cover exceeds the limit set by the insurer. The limit may be varied by the insurer from time to time. You also need to submit evidence of good health if you apply for additional insurance cover. If this applies to you, you should read the duty of disclosure section of the insurer s forms carefully. Any cover subject to health evidence will only be granted if you provide all required evidence and the insurer grants the cover in writing. If you elect not to submit this evidence, your benefits will be restricted appropriately. The insurer will assess the evidence and may apply a loading to your fee, or impose restrictions or exclusions on the cover granted. It may even refuse your application for cover. If for some reason, the insurer does not accept or pay out all or part of the insurance, then the benefit payable to you will be reduced accordingly. You will be advised if this affects you. Fees for standard cover Death and disablement cover Age Annual fee* $ Age Annual fee* $ * The fees are per $1,000 of your insured benefit. They are set by the Fund s insurer and are subject to change from time to time

41 Death only cover for casual employees, contractors and employees working less than 15 hours per week Casual employees, contractors and employees working less than 15 hours per week receive an amount of cover for death only, that depends on their age as set out in the table below. The amount of cover will therefore change each year. The cost of the cover is $1 per week. Age Death only cover Age Death only cover 15 $57, $49, $57, $46, $57, $42, $57, $38, $57, $34, $59, $31, $61, $29, $64, $26, $68, $24, $70, $22, $74, $20, $79, $18, $81, $16, $81, $15, $81, $14, $81, $13, $81, $11, $78, $10, $75, $9, $73, $9, $69, $8, $67, $7, $63, $6, $58, $6, $53, $5,715 How do I make a claim? If you wish to make a disability claim, you should contact the Fund Administrator to obtain the appropriate forms. It is in your interests to lodge your claim as soon as possible. The insurer will require you to undergo one or more medical examinations in order to determine whether you satisfy the relevant definition of disablement. You should note that it can take some time to obtain all the required information and obtain appointments for medical examinations. This means that it may be some time before your claim is finalised and, if it is accepted, for payment to be made. You will be kept informed of the progress of your claim. When does my insurance cover cease? Insurance cover ceases from the earliest of any of the following circumstances: When you die (except that any liability to pay a death benefit shall remain); When a death, terminal illness or TPD benefit has been paid by the insurer; The day before you commence duty with the armed services; The day before you reach age 65 for your standard cover (or 70 for voluntary cover); If you transfer all of your benefit out of the Fund; or If the insurance policy is cancelled or terminated for any reason. Members can reduce or opt out of their insurance cover at any time by notifying the Fund Administrator in writing. Permanent employees can choose to opt out of their TPD cover and retain death only cover. If you leave the Fund, the Fund s insurer does not provide you with the option to continue your cover under a personal policy without providing evidence of good health. What happens if I cease employment with the Elphinstone Group? Members who cease employment or exercise Choice of Fund (by having their contributions paid to another fund) and have more than $5,000 in the Fund are automatically transferred to the Fund s Retained Benefits Division. If you are transferred to the Retained Benefits Division on or after 1 January 2014, your TPD cover automatically ceases but your death only insurance cover continues. Your death only insurance amount (including any voluntary death insurance, if applicable) will be the same as the amount you have on the date you ceased employment or when contributions are first paid to your new fund. The fees will be the same as for additional voluntary insurance (see the table on page 6). In the Retained Benefits Division, you can reduce or opt out of your cover at any time by notifying the Fund Administrator in writing. Cover automatically ceases when you turn 70.? What is a total and permanent disablement benefit? You will be considered to be totally and permanently disabled if you meet the insurer s and the Fund s Trust Deed definition, summarised below. You should refer to the Trust Deed and insurance policy for the full definition. Please note that a different definition applies to members who had TPD cover in the Fund on 30 June 2014, and to members who have been on unpaid leave for more than two years. Total and permanent disablement generally means: You have provided proof to the insurer s satisfaction that you have become incapacitated to such an extent as to render you unlikely ever to engage in or work for reward in any occupation or work for which you are reasonably qualified by reason of education, training or experience; and at least one of the following applies: You are suffering the permanent loss of use of two limbs or the sight of both eyes or the loss of use of one limb and the sight of one eye (where limb is defined as the whole hand or the whole foot). You have been absent from your occupation with the Company through injury or illness for six consecutive months. Through illness or injury and having provided proof to the insurer s satisfaction, you are permanently unable to perform two of the following six basic activities of everyday living: Bathing to shower or bathe; Dressing to dress or undress; Toileting to use the toilet including getting on and off; Feeding to eat and drink; Mobility to get out of bed or a chair or wheelchair; or Continence to control bladder and bowel function. If you can perform the activity by using special equipment, you will be considered able to undertake that activity. Through illness or injury and having provided proof to the insurer s satisfaction, you are suffering from the permanent deterioration or loss of intellectual capacity that has required you to be under continuous care and supervision by another adult person for six consecutive months and this care is likely to be on a permanent daily basis and ongoing. 43

42 Risks of insurance The Trustee uses one or more insurance policies to meet part of the benefit payable on death or total and permanent disability. If the insurance company imposes restrictions, special conditions or refuses to pay a claim, the Trustee has the power under the Trust Deed to adjust your benefit accordingly. As a result, there are a number of risks associated with restrictions and special conditions imposed by the insurance company. These include: The risk that a member may suffer an injury or illness such that they cannot work but are not sufficiently injured or ill to satisfy the insurer s and/or the Fund s definition of disablement. In this case no insurance payments will be made; The risk that, even if your claim is accepted, it may take some time for payment to be made. For example, it can take some time to obtain all the required information to assess the claim; The risk that the insurer may refuse to provide cover in certain circumstances. For example, if you commit suicide or intentionally injure yourself, or make a claim caused by war. In this case, an insurance benefit may not be paid; The risk that you are not covered if you work less hours per week than the minimum required under the policy. For example, casuals, part-time employees or employees on leave without pay may not be covered for TPD; The risk that the maximum amount of cover allowable under the policy may be lower than the benefit calculated in accordance with the formula or is insufficient to meet your needs; The risk that the insurance company may decline (or defer) your cover, which may also affect your ability to obtain insurance cover in the future; and The risk that the insurance company may not provide cover if you are required to work overseas. If, for any reason, the insurer does not pay out all or part of the insurance, then the benefit payable will be reduced by that amount. You will be advised if this affects you. The risk that you may not be covered if you did not join the Fund when first eligible;

43 Additional voluntary insurance Additional voluntary insurance cover offers you, as a permanent employee and Fund member, the opportunity to provide you and your family with extra financial security should you die or become permanently disabled. Although this is something we prefer not to think about, providing some financial security for your family, should the worst happen, can at least offer them some comfort. As a member of the Elphinstone Group Superannuation Fund, you may be eligible to automatically receive standard insurance cover for death and total and permanent disablement (see page 2 for details). Some members may want to provide additional financial security for themselves or their family in the unfortunate event of death or disablement. If you don't know what your standard insurance cover is, contact the Fund Administrator on Additional voluntary insurance cover for death and TPD is available for members who are under age 65 and are either fulltime employees or permanent part-time employees who work at least 15 hours per week. Permanent part-time employees working less than 15 hours per week, and members aged 65 to 70, can apply for voluntary death only insurance cover. You can reduce or opt out of your cover at any time by notifying the Fund Administrator in writing. Voluntary death only insurance cover ceases when you turn 70. Deciding how much extra is enough How much additional cover you need depends on your personal circumstances. You may wish to consider things such as: Whether you have dependants who rely on you for financial support; What your financial commitments are, e.g. mortgage, loans, lifestyle; The value of your current assets, including superannuation already saved, and your standard insurance cover in the Fund; and The impact of insurance fees on the growth of your superannuation benefit. Receiving your additional voluntary insurance Your additional insurance cover will be paid in the same way as your standard death and disablement benefit from the Fund. If you die and have completed a valid binding nomination form, your insurance will be distributed to your dependants as you instructed. Otherwise, the Trustee will determine how to distribute the amount to your dependants and/or legal personal representative. If you become totally and permanently disabled you will receive your insurance amount, providing the Trustee and insurer are satisfied you meet the insurer's current definition of total and permanent disablement (see page 3 for a summary of the definition). The benefit payable will be met from an insurance policy taken out by the Trustee of the Fund and is subject to the terms and conditions of that policy. In all circumstances, the additional benefit will be paid to you only if the Trustee and insurer approve your claim. Changing your cover You can change the amount of your voluntary insurance cover at any time. You may have to provide new evidence of health if you ask to increase your cover. To stop or decrease your insurance cover, simply provide your instructions in writing to the Fund Administrator. Fees The Fund offers members fees that may be better than private policies. This is because the Fund buys its insurance at wholesale rates and there are no commissions. To calculate your fee, please refer to the next page. Limit on how much cover you can buy When you apply for additional insurance, you choose the amount of cover that will suit your personal needs. Be aware however that, ultimately, it is the Fund's insurer who decides whether or not your application for additional voluntary insurance will be accepted or whether conditions apply. For example, the insurer may limit the amount of cover it is willing to offer you or it may charge a fee loading in addition to the quoted fees. It may also ask for financial evidence to justify applications for very large amounts of cover. 65

44 Fees for additional voluntary insurance cover* Age Death cover # $ Death & disablement cover $ Age Death cover # $ Death & disablement cover $ * The fees are per $1,000 of cover. They are set by the Fund s insurer and are subject to change from time to time. Calculating your fee for additional voluntary insurance cover Like most insurance cover, the fee depends on your age and how much additional voluntary insurance cover you would like to purchase. The annual fees are for every $1,000 of insurance you wish to purchase. To calculate your fee: 1. Determine how much additional voluntary insurance cover you would like. 2. Go to the fees table to the left and find the fee next to your current age. 3. Calculate your fee: insurance fee x amount of insurance required / $1,000. For example, if you would like to take out death and disablement insurance cover for an extra $50,000, you have to multiply your fee rate by 50 (i.e. $50,000/$1,000). If you are currently aged 35, your annual fee would be calculated as: $1.42 x 50 = $71. The fee for your additional voluntary insurance cover will be deducted from your superannuation account. The amount will appear on your annual Personal Statement of Benefits. # This is also the fee for Retained Benefits members. Fees for additional voluntary death only insurance cover for members aged 65 to 69* Age Death only cover ($) * The fees are per $1,000 of cover. They are set by the Fund s insurer and are subject to change from time to time

45 Providing evidence of good health When you apply for cover, you may be required to complete a questionnaire about your personal and medical history, and you may be asked to undergo a medical examination or provide any other evidence requested by the insurer. If this applies to you, you should read the duty of disclosure section of the insurer s forms carefully. Any cover subject to health evidence will only be granted if you provide all required evidence and the insurer grants the cover in writing. If you elect not to provide this evidence, your application cannot proceed. Who provides the cover The Trustee of the Fund reviews the insurer from time to time and may change the insurance company accordingly. If you would like to know who the Fund's current insurer is, please contact the Fund Administrator on You should also be aware that the terms and conditions for additional voluntary insurance cover are subject to change. This may be due to the Fund changing the insurance company, or to any changes made by the Fund's insurer. Should any material change occur, you will be advised. Applying is easy To apply for additional voluntary insurance cover, simply: Complete an Application for additional voluntary insurance cover at the back of this document. Send the completed application form to: The Fund Administrator Elphinstone Group Superannuation Fund PO Box 1442 Parramatta NSW 2124 The Fund's insurer may ask you to complete a medical questionnaire, which will be sent to you. This questionnaire should also be returned to the Fund Administrator at the address above. Once your application has been received and processed, the Fund Administrator will contact you to advise you of any additional requirements, such as medical tests, and to provide the insurer s decision on your application. Questions If you would like more information, contact the Fund Administrator on

46 Application for additional voluntary insurance cover Complete this form ONLY if you wish to apply to the Fund s insurer for additional voluntary insurance cover. Part A: Your details Last name (please PRINT) First name Title Mr Mrs Ms Miss Home address Date of Birth / / State Postcode Membership number* * Your membership number can be found on your annual Personal Statement of Benefits or by contacting the Fund Administrator on Providing your address The Trustee may decide to provide information about the Elphinstone Group Superannuation Fund or your benefits electronically in the future. This may include Product Disclosure Statements, Personal Statements of Benefits, Exit Statements, Annual Reports, newsletters or information on material changes to your superannuation or significant events. If you d like to receive information electronically, where available, please provide your address. Part B: Request for additional voluntary insurance cover I wish to apply for $ of additional voluntary insurance cover under the Fund. The standard cost of this cover is based on the fees set out on page 6 of the Insurance Guide. Part C: Declaration I acknowledge that: I have read and understood the Insurance Guide. I understand that my Application for additional voluntary insurance cover is subject to the insurer's approval and that I may be required to complete a medical questionnaire and undergo a medical examination or provide other evidence requested by the insurer. I have received a copy of the Fund's Privacy Policy. I understand that I will be requested to provide personal medical information to the Trustee in order to assess my eligibility for additional voluntary insurance cover. I hereby consent to this information being disclosed as described therein. Signature: Please complete and return this form to the Fund Administrator: The Fund Administrator Elphinstone Group Superannuation Fund PO Box 1442 Parramatta NSW 2124 I understand that I can change the level of my insurance cover at any time, that any increase is subject to acceptance by the insurer, and I may be required to supply further medical or other evidence. I understand that the Fund will deduct the fees for additional voluntary insurance cover from my superannuation account. Date: / / Issued by Elphinstone Group Superannuation Pty Ltd (ABN ), as Trustee of the Elphinstone Group Superannuation Fund (ABN ). MySuper Authorisation number March 2018

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50 Elphinstone Group Superannuation Fund 19 March 2018 Investment Guide Contents Important information 1 What is Member Investment Choice? 2 About your investment options 5 What to consider when choosing an investment option 6 Investment risks 7 Your investment options 8 Making and changing your choice 13 Keeping track of your superannuation online 14 Issued by Elphinstone Group Superannuation Pty Ltd (ABN ), as Trustee of the Elphinstone Group Superannuation Fund (ABN ). MySuper Authorisation number

51 Important information The information in this document forms part of the Product Disclosure Statement (PDS) for the Fund s Accumulation section, dated 19 March This information should be read in conjunction with the other documents that form part of the Product Disclosure Statement. You should consider this information before making a decision about the relevant product. The information provided is general information only and does not take into account your particular objectives, financial circumstances or needs. It is not personal or tax advice. Any examples included are for illustration only and are not intended to be recommendations or preferred courses of action. You should consider obtaining professional advice about your particular circumstances before making any financial or investment decisions based on the information contained in this document. Each investment option is invested in the investment products of various Investment Managers. The Trustee monitors the Managers regularly. The Trustee may change the underlying Managers or products of any of the options at any time without prior notice to, or consent from, members. Neither the Trustee nor Elphinstone Group (Aust) Pty Ltd can provide you with financial advice. The Trustee will only provide factual information. Investment returns can be positive or negative and are not guaranteed by the Trustee or the Company. Information on tax and superannuation legislation is current as at 1 July 2017, unless otherwise noted. The Trustee reserves the right to correct any errors or omissions. Information contained in this document that is not materially adverse is subject to change from time to time and may be updated if it changes. Updated information can be found at In addition, we will provide a hardcopy free of charge on request, if you contact the Fund Administrator on For further information: P am to 5.00pm weekdays (AEST) M The Fund Administrator Elphinstone Group Superannuation Fund PO Box 1442 Parramatta NSW 2124 W E egsfsuperadmin@linksuper.com 12

52 What is Member Investment Choice? Member Investment Choice is a feature of the Fund that lets you choose how you wish your superannuation to be invested from a range of investment options. You can choose one or a mix of up to four options the Growth, Balanced, Conservative and Cash options. If you don t choose an investment option, your superannuation will be invested in the Balanced option. This is the option for MySuper members. As your needs change, so can your investment choice. For more information on changing your investment option, see page 13. The basics of investing To make the right investment decision for you, it s important that you understand some investment basics. The investment cycle History shows that economies and investment markets typically move in cycles. Some investments or asset classes, such as shares, are more volatile and can change substantially in value within a short period, while others, like bonds, are generally less volatile. The characteristics of these investments or asset classes are explained in more detail below. About asset classes The Fund invests in four main asset classes: cash, fixed interest, property and shares. Each asset class has a different level of risk and return. Generally, as the potential for a higher long-term return increases, the risk of fluctuations in value will also increase. These asset types can be grouped into two categories: Income assets Earnings from income assets come primarily from interest payments on assets such as cash and fixed interest. Income assets generally provide a lower return than growth assets over the long term. They are also less likely to fluctuate in the short term. Growth assets Earnings from growth assets (e.g. shares and property) come from the dividend income received from the investment and capital growth. Growth assets usually provide a higher return than income assets over the long term. They are also more likely to fluctuate in value over any one year, so they may not always be suitable for a short-term investment. Each of the Fund s investment options invests in a different mix of growth and income assets. This influences the level of expected risk and return for each option. More information about the main asset classes is shown in the table on the next page. The relationship between risk and return Risk is the potential for your savings to go up and down in value. Return is the amount of money earned by your investment. When you re investing, risk and return go hand in hand. The higher the long-term return you re aiming for, the greater the risk of your money going up and down in value in the short term. That s because, in order to get a higher long-term return, you generally have to invest a greater proportion of your savings in growth assets, and returns from growth assets can be volatile. Returns from growth assets vary a lot more than returns from investments in income assets. So there s much greater risk that growth investments will have a negative return in any one year. Risk can also mean: Not having enough money to live on in retirement. Choosing an investment option with a lower investment risk may mean that you earn a lower return on your savings. Over a long period, even a small difference in your investment returns can make a big difference to your final benefit. This is mainly due to the principle of compounded returns. See page 4 for more information. Your savings not keeping up with inflation. If you choose an option that has less potential for growth, the value of your investment may not increase very much before you retire. Over time, prices for goods and services usually go up. If your retirement is some way off, your money won t buy as much by the time you retire as it does today. Talking investments Short term one to three years. Medium term three to seven years. Long term seven years or more. Volatility the ups and downs, or fluctuations, of investment returns

53 Asset class About this asset class growth assets income assets HIGH Shares Property LEVEL OF RISK & EXPECTED LONG-TERM RETURN Fixed interest Cash LOW When you buy shares, you re buying a share in a company. This means that the value of your investment changes when the company pays dividends, or when the company s share price increases or decreases on the stock market. Of all the asset types, shares are generally expected to earn the highest return in the long term. On the downside, the value of shares will fluctuate more than any other main asset type, and they have the highest probability of negative returns in the short term. Property investments include commercial, industrial and residential real estate. They provide income through rent payments and also have a potential for capital gains. Property is considered a moderate to higher risk investment, and property values are subject to cyclical changes. Over the long term however, property has tended to provide higher returns than cash or fixed interest investments. When you buy fixed interest investments (i.e. bonds), you re effectively lending money to a corporation or Government body at a set rate. The value of your investment changes when you receive interest and when the value of the bond increases or decreases (with interest rate changes). Over the long term, bonds are expected to provide a higher return than cash. As their value can fluctuate, bonds are more volatile than cash, but generally less volatile than shares. Investing in cash is similar to putting your money into a savings account. You re investing in short-term assets such as bank bills. Interest is paid on the amount you ve invested, and the value of these types of investments does not fluctuate. That s why it s very unlikely that you ll lose money on a cash investment over a short period of time. At the same time, cash investments may not always keep up with inflation

54 Compounding returns When you invest even a small amount of money in cash, shares, or some other type of investment it will usually earn you interest, rent or other income over time. If you immediately reinvest this interest or income rather than spend it, you will effectively be earning interest on your interest. This can mean that your savings grow even faster. This is the principle of compounding. Compounding works in the same way with your retirement savings. Each year, investment returns are applied to your savings when returns are positive, your savings may grow even more over time with the help of compounding, as illustrated in the graph below. Difference due to compounded earnings* VALUE ($) TIME (years) *This graph demonstrates the principle of compounding but is not intended to depict the future value of any particular investment. Talking investments Here are some key terms and their definitions that will help you better understand the investment options set out in the table on pages 9 to 12. Consumer Price Index (CPI) this is an official measure of inflation. Diversification the goal of diversification is to reduce the risk in an investment option by combining a variety of investments (such as shares, property, fixed interest and cash), which are unlikely to go up and down in value at the same time or by the same amount. Diversification reduces both the upside and downside earning potential of an option and allows for more consistent performance under a wide range of economic conditions. Hedging when investments are hedged, their value is protected from the impact of external factors, such as currency fluctuations. For example, when there are changes in foreign exchange rates, the value of the Fund s overseas investments is affected. In particular, when the Australian dollar is strong against foreign currencies, this can have a negative impact on overseas investments. This is because they are worth less when they are converted into Australian dollars. The Fund currently uses currency hedging for the Fund s Growth, Balanced and Conservative investment options for a portion of the investment in international shares

55 About your investment options You can choose one or a mix of four different investment options for your superannuation Growth, Balanced, Conservative and Cash. Each investment option has its own investment objectives and strategy. Investment objectives are the goals set by the Trustee of the Fund for managing the Fund s assets. Each option also has a specific investment strategy, which is the plan that the Trustee follows to achieve the investment objectives. If you don t make an investment choice when you join the Fund, your superannuation will be invested in the Fund s Balanced option. This is also the investment option for MySuper members. For the investment objectives and strategy for each option, go to pages 9 to 12. Who manages the Fund s investments? The Fund s assets are invested by professional Investment Managers (appointed by the Trustee) in accordance with strict guidelines. The Trustee does not take into account labour standards or social, ethical or environmental considerations for the purposes of selecting, retaining or realising the Fund s investments or the underlying investments of any of the Fund s investment options. When the Fund s Investment Managers were selected, the Trustee did not consider whether the Managers took these factors into account. The Trustee reviews each Investment Manager s performance on a quarterly basis, and the Fund s investment objectives annually. The Trustee may change the Fund s Investment Managers and their products from time to time without prior notice to, or consent from, members. For further details on the Fund s Investment Managers, see the latest Annual Report. What rate of return do I receive? Your accounts receive the actual investment return for your chosen investment option(s) after allowing for tax, investment fees and any other unallocated administration expenses. The Fund s investment returns may also be reduced for an allowance to maintain the Fund s Operational Risk Financial Requirement reserve if required. Your individual rate of return may vary depending on the timing of your contributions and transactions. Interim rate Investment returns are calculated each month. If your superannuation needs to be paid out before investment earnings have been applied for the month, an interim earning rate will be used. This will cover the period from the end of the previous month until the date your benefit is paid. An interim rate may also be used if you switch investment options. The interim rate is based on the Fund s estimated monthly net investment returns. 5

56 What to consider when choosing an investment option How you feel about risk Some people are prepared to take on more risk than others when it comes to investing their retirement savings. See page 7 for more information about investment risk. When considering your attitude to risk, remember: Risk and return go together Generally, the higher the risk associated with an investment option, the greater its potential for a higher return. The key is achieving a balance that you are comfortable with. The long and short term Generally, the higher the return that is expected from an investment in the longer term, the more likely that its returns will fluctuate that is, go up and down in value in the short term, and vice versa. How long you have to save The length of time you have before you will need to access your retirement savings also known as your investment horizon will also impact your investment decision, as this may determine how much risk you are prepared to take. For people with a long investment horizon, ups and downs in short-term earnings are usually less of a concern than for those who will soon need to access their savings