THE CAP GROUP PENSION SCHEME

Transcription

1 YEAR ENDED 31 MARCH 2013 REPORT AND ACCOUNTS E: -o Registered number:

2 CONTENTS Page Trustees and their advisers I - 2 Trustees report 3-7 Investment report 8-12 Statement of Trustees responsibilities 13 Independent Auditors report to the Trustees 14 Fund account 15 Net assets statement 16 Notes to the accounts Independent Auditors Statement about Contributions 24 Summary of contributions paid during the year 25 Actuarial statements Compliance statement 33-34

3 TRUSTEES AND THEIR ADVISERS YEAR ENDED 31 MARCH 2013 Trustees J Dixon - Member Nominated Trustee J M Allan - Member Nominated Trustee (resigned 28 May 2012) J Barnett J Hickling G Dixon - Member Nominated Trustee Principal Employer Calsonic Kansel UK Limited Llethri Road LIanelli Carmarthenshire SA14 8HU Scheme Actuary D Higgs F.I.A. (resigned 30 April 2013) Aon Hewitt Limited 25 Marsh Bristol BSI 4AQ Street Nick Clark (appointed I May 2013) Lane Clark & LLP St Paul s House, St Paul s Hill Winchester 5AB S022 Peacock Scheme Administrator Aon Hewitt Limited 25 Marsh Bristol BS1 4AQ Street Independent Auditors Investment Managers PricewaterhouseCoopers LLP Chartered Accountants and Statutory Auditors One Kingsway Cardiff CF1O 3PW Schtoder Investment Management Limited 31 Gresham London EC2V 7QA Street Legal & General Assurance Limited One Coleman London EC2R 5AA Street Page 1

4 .1 :3?.# c-. TRUSTEES AND THEIR ADVISERS YEAR ENDED 31 MARCH 2013 Trustees and their advisers (continued) AVC Providers Equitable Life Assurance Society PC Box 177 Walton Street Aylesbury Bucks HP21 7YH Prudential Assurance Company Limted Stirling FK9 4UE Custodian JP Morgan Chase Bank NA 125 London Wall London EC2Y 5AJ HSBC Global Investor Services IF, 78 St James s Street London SW1A 1EJ Citibank 3 Hanover Square London WIS 1HD Banker Bank of Scotland (removed 54/62 Sauchiehall Street Glasgow G2 3AH 18 June 2013) HSBC Bank plc (appointed 18 June 2013) 60 Queen Victoria Street London EC4N 4TR Solicitor Eversheds LLP I Callaghan Square Cardiff CF1O 5BT Page 2

5 The Trustees of The CAP Group Pension Scheme (the Scheme ) are pleased to present the annual report Introduction YEAR ENDED 31 MARCH 2013 TRUSTEES REPORT Page 3 There were no major changes to the Scheme during the year. Scheme changes The Scheme was closed to new entrants from 1 May The Principal Employer of the Scheme is: Calsonic Kansei UK Limited, Llethri Road, Llanelli, Carmarthenshire, SA14 8HU. The Principal Employer The Trustees met formally three times during the year. Trustee meetings The present advisers to the Trustees are shown on pages 1 and 2. members or beneficiaries of the Scheme. confirmed that he knew of no circumstances connected with his resignation, which affected the interest of & Peacock LLP was appointed to replace him on I May In a letter to the Trustees, David Higgs David Higgs of Aon Hewitt Limited resigned as Scheme Actuary on 30 April 2013 and Nick Clark of Lane Clack Board. There is currently a vacancy for a company and member nominated Trustee. The Trustees meet regularly throughout the year, and undertake regular training with the assistance of their professional advisers. Trustee provisions. The Scheme has two Member Nominated Trustees, representing 50% of the Trustee Trustees may be appointed or removed by Calsonic Kansei UK Limited subject to the Member Nominated Trustees and Advisers March 2010 by Constitutional and Final Salary Rules. 2006, the Scheme became a registered pension scheme for tax purposes and replaced and amended on 31 Customs for the purpose of Chapter I, Part XIV of the Income and Corporation Taxes Act From 6 April Definitive Trust Deed dated 23 April Until 5 April 2006 the Scheme was approved by the HM Revenue & The Scheme is governed by a Definitive Trust Deed and Rules dated 19 December 1994 and a consolidating retirement or to their dependants on death before or after retirement based on the member s salary near to under the provisions of the Pension Schemes Act The Scheme, which is contributory, provides pension and lump sum benefits payable to full members on their retirement or otherwise leaving service. The Scheme is contracted-out of the State Second Pension (S2P) is Lane Clark & Peacock LLP. solely for the benefit of its members and other beneficiaries. With effect from I May 2013 the new administrator scheme and was administered by Aon Hewitt Limited in accordance with the establishing document and rules, together with the audited accounts for the year ended 31 March The Scheme is a defined benefit

6 TRUSTEES REPORT YEAR ENDED 31 MARCH 2013 Membership Details of the membership of the Scheme as at 31 March 2013 are given below: Members with Active preserved members Pensioners benefits Total Members at the start of the year Adjustments to the members (1) Retirements (3) 13 (10) - Members leaving with preserved benefits (3) - 3 Transfer out - - (1) (1) Total membership at the end of the year Pensioners include individuals receiving a pension upon the death of their spouse. Adjustment to members represents membership movements identified after the prior year report was signed. These membership figures do not include movements notified to the Administrator after the completion of the annual renewal. Pension increases The cap on statutory revaluation for deferred benefits has reduced from 5% to 2.5% with effect from 6 April The pension in excess of any Guaranteed Minimum Pension accrued prior to this date will revalue in line with the increases in the Consumer Prices Index (CPI) between the date of leaving the Scheme and Normal Retirement Age subject to an overall maximum of 5% pa for the period. Pension increases in retirement (excluding those on post 1988 GMPs) are unaffected by the statutory change from RPI to CPI as the Government s measure of price inflation. Review of the financial developments during the year as shown by the audited accounts The accounts on pages 15 to 23 show that the value of the Schemes assets increased by 5,184,680 to 32,877,811 as at 31 March The increase was comprised of net additions from dealings with members of 1,294,988 together with a net increase in the value of investments of 3,889,692. The Trustees did not obtain the accounts within seven months of the Scheme s year end as required by pensions legislation. In all other respects the accounts have been prepared and audited in accordance with the regulations made under Sections 41(1) and (6) of the Pensions Act Further details of the financial developments of the Scheme may be found in the audited accounts on pages 15 to 23. Page 4

7 as at 31 March Using the Projected Unit valuation method, the Scheme, on an ongoing past service A formal actuarial valuation will be carried out at least every 3 years. The last actuarial valuation was completed Review of the Schemes financial prospects having regard to the actuarial valuation statement YEAR ENDED 31 MARCH 2013 TRUSTEES REPORT Page 5 1 April 2012, which was expected to address the deficit over 9 years, plus 7.5% of pensionable earnings for In addition the company made deficit contributions of 625,000 in accordance with the Schedule of * For members participating in salary sacrifice arrangements these amounts are paid by the Employer. Contributions dated 6 February Employee 75* Employer 17.1 From 6 February 2012 to 31 March 2020 Contributions Contributions certified by the Actuary on 6 February Contributions received from members and Participating Employers were in accordance with the Schedule of Contributions laid down by the Trustees. which are regulated by the Financial Conduct Authority. Investment Managers report directly to the Trustees. Investment Managers, Schroder Investment Management Limited and Legal & General Assurance Limited, The day-to-day management of the Scheme s investments has been delegated by the Trustees to their The Investment Managers are given full discretion in making investment decisions, subject to broad guidelines are responsible for the overall investment policies of the Scheme. Responsibility for the administration and management of the Scheme s assets is vested in the Trustees who The current investment managers are shown on page 1. Investment advisers The next full valuation is due as at 31 March those members electing to make contributions using salary sacrifice. contributions should be at a rate of 900,000 over the year to 31 March 2012 and 1,250,000 per annum from of expenses, was 24.6% of pensionable earnings. The Trustees and Company agreed that the Company The actuary calculated that the future contribution rate required to provide for future service benefits, inclusive contributions required to meet the Scheme s liabilities. the financial soundness of the Scheme and recommend to the Company and Trustees the future rate of basis, had a funding level of 88% representing a deficit of 3.7m. The purpose of the valuation is to determine

8 Members no longer in service can normally transfer out the value of their benefits to another appropriate Transfers YEAR ENDED 31 MARCH 2013 TRUSTEES REPORT Page 6 Expression of Wish Forms are available on request from Lane Clark & Peacock LLP. The Trustees wish to remind members that they can indicate to the Trustees the persons to whom they wish review their Expression of Wish Forms should their circumstances change. able to take members wishes into account, although they are not obliged to do so. Members are also urged to any lump sum benefits and pension benefits to be paid in the event of their death. The Trustees will then be Expression of Wish Forms Company Limited. Annual statements are sent to members paying AVCs in respect to their contributions and accumulations of their funds. contributions are separately invested with Equitable Life Assurance Society and Prudential Assurance Twelve members paid AVCs during the year to increase their pension entitlement at retirement. These There is provision for members to pay AVCs in order to increase their benefits under the Scheme. Additional voluntary contributions (AVCs) advice. on 1 October 2008 making the Trustees responsible for setting the transfer value basis, after taking actuarial pension arrangement. The transfer value of a Scheme member s benefits includes no allowance for any discretionary benefits which might be awarded in the future. New legislation on transfer values came into effect.

9 c#., * TRUSTEEs REPORT YEAR ENDED 31 MARCH 2013 Further information Further information about the is available, on request, to members, their and other beneficiaries together with all recognised trade unions. In particular, the documents constituting the the Rules and a copy of the latest actuarial report and the Trustees of Investment Principles can be inspected. statements are Scheme Statement spouses Scheme, Individual benefit provided to active members annually. In addition to the information shown on details of the amount of their current transfer value and, if applicable, the current amount of any refund of contributions to which they would be entitled on leaving service. Such are available free of charge once a year. these statements members can requests request If members have any queries concerning the or their own pension position, or wish to obtain further information, they should contact the Administrator who will also be able to provide them with a further copy of the booklet should they require one and any queries that they may have about entitlement to benefits. Scheme Scheme If you have any complaints in relation to the Penny Coleman Lane Clark & Peacock LLP St Paul s House, St Paul s Hill Winchester 5AB S022 Scheme Scheme answer you should in the first instance contact: The Data Protection Act to protect and the individuals rights to privacy. The Data Protection Act 1998 into force on 1 March 2000 and regulates the of personal data relating to living individuals that are automatically or manually and held in a relevant filing system. Explicit of the member is required where personal sensitive data is held or Sensitive information can include information relating to on, for example, the health of a member. came processed seeks respect use processed. consent The in their capacity Data Controllers and the Scheme s advisers in their capacity Data Processors under the Act have legal obligation and a legitimate interest to data relating to for the purpose of administering and operating the which includes passing on data to third parties. For example, the provision of Death in Service benefits requires information to be to other professional providers and Life office advisers who underwrite such benefits. members Trustees, Trustees, as each Scheme, process passed The the Company and the Scheme s advisers have legal obligation and a legitimate interest to data relating to members for the purpose of administering and operating the which includes passing on data to third parties, process Trustees The Act 1998, in Processors. as mentioned above. each Scheme, and the Company are regarded Data Controllers, for the of the Data Protection relation to the referred to above. The advisers appointed by the are Data process as purposes Trustees as Page 7

10 The names of the Investment Managers are given on page 1. funds and Legal & General was responsible for the investment of 44% the funds. As at 31 March 2013, Schroder Investment Management was responsible for the investment of 56% of the Investment principles IN VESTMENT REPORT Page 8 Europe (ex UK) Others Total GTAA Property Diversified Growth Cash UK Equities UK Bonds Others Total Equities Japan North America March 2013 Benchmark 31 March I 0/ 0/ /0 /0 / Asset Allocation result. ranges. This has since been corrected naturally, and the trustees do not intend to take any further action as a At the year end, one of the asset sectors, was, due to market movements, very marginally outside its tolerance requirements of the Pensions Act A copy of the Statement is available on request. Asset allocations at Further information on investment issues is detailed in the SIP prepared by the Trustees in accordance with the the year end were in line with the SIP. Statement of Investment Principles fs1p) relative attractions of each market. The Investment Managers must also ensure that the assets are readily throughout the major investment markets in proportions that reflect the Investment Managers views on the marketable. long term, subject to an acceptable level of risk. In order to achieve this, the assets of the fund are distributed The general investment strategy of the Investment Managers is to achieve steady growth over the medium to securities. The fund does, however, also hold a number of fixed interest securities and some cash in order to achieve a balanced portfolio of investments. return which at least matches inflation, for example, equities, property and index-linked UK Government The general investment policy followed is to invest principally in securities which are considered likely to earn a

11 INVESTMENT REPORT Review of investment performance In the SIP the Trustees have set out their performance objective for each manager. Over the year, Aon Hewitt Limited monitored investment performance (going forward this will be Lane Clark & Peacock LLP) on a quarterly basis and discloses this to the Trustees. Each fund manager s performance is compared to their own specific benchmark. Performance gross of fees to 31 March 2013 for managers holding Scheme assets at the year end is given in the table below: 1 year 3 years 5 years FUND ¾ % p.a. % p.a. LGIM UK Equity lndex* N/A FTSE ALL-SHARE INDEX N/A LGIM Overseas Equities* NIA COMPOSITE BENCHMARK N/A Schroder Diversified Growth RETAIL PRICE INDEX +5% Schroder UK Alpha Plus Fund FTSE All-Share Index Schroder Long Dated Corporated Bonds Benchmark SchroderUK N/A N/A N/A Benchmark N/A NIA N/A Total Scheme Return N1A Weighted Benchmark/Target Return N/A (n/a above means that the funds were not invested in those periods and hence the performance figures are not available) *The Scheme has been invested in the L&G funds since 10 September Employer related investments The Scheme is invested in accordance with the Occupational Pension Schemes (Investment of Scheme s Resources) Regulations 1992, and there is no self-investment in the Scheme (that is, investment in the principle employer s shares, loans or property), other than the outstanding contributions described in note 13 to the accounts of 1 0,617, which represent 0.03% of the Scheme s net assets. The Scheme assets are invested in highly marketable traded securities and fees are payable based on the particular classes held. Further details are available in the Statement of Investment Principles. Page 9

12 General Background Market Commentary INVESTMENT REPORT Page 10 Small cap equities climbed 24.5%, outperforming large (15.4%) and mid cap equities (24.3%) over the year. Consumer Goods (27.9%) and Consumer Services (27.6%) produced the strongest returns. Oil & Gas (-2.0%) and Basic Materials (-7.7%) were the two worst performing sectors. Technology (35.4%), February, citing the UK s poor growth outlook and its high debt burden. It was largely unaffected by Moody s downgrading of the UK government credit rating from AAA to AA1 in The UK equity market (FTSE All Share) moved up by 16.8% over the 12 months, helped by quantitative easing. UK Equities more than offset capital losses. UK property returns were positive with the IPD Monthly Index rising 2.5% over the period, as income returns Gilts Index gained 12.0% over the 12 months to the end of March UK corporate bonds outperformed gilts over the year as a result of narrowing credit spreads. The iboxx Non period. Yields reached all time lows over the summer before moving higher over the rest of the calendar year. Risk aversion also caused safe haven flows into gilts during the turmoil, which climbed 5.3% over the 12 month policy. Emerging Markets was the weakest of the major regions in local currency terms, as economic data Japan was the strongest market in local currency terms as investors anticipated aggressive monetary Despite the fragility of the world economy, global equity returns were strong over the 12 months to 31 March proved to be lacklustre. other major economies were weak with economic data consistently coming in below forecasts. Softer Chinese data and slow global trade volumes underscored weak global growth levels. US economic data improved throughout the year especially in the housing and labour markets. In contrast, term to support its economy. beginning of March. The Federal Reserve ( Fed ) also expanded quantitative easing ( QE ) with an indefinite However, US budget negotiations failed to yield a solution before automatic spending cuts were triggered at the Investors were also nervous in the build up to the US fiscal cliff deadline, which was averted at the last minute. inoperative). However, the turmoil was far from over as Greece and Cyprus agreed bailout deals in November and March respectively. ensuing establishment of Outright Monetary Transactions ( CMI ) validated this vow (although it remains Eurozone issues dominated the newsflow over the year. The uncertainty in markets eased considerably when European Central Bank ( ECB ) President Draghi vowed to do whatever it takes to support the Eurozone. The.tk

13 the US producing the highest sterling returns (20.1%) of all the major regions. QE, decent corporate earnings and positive economic releases helped. Over the period, US equities finished 14.2% higher in local currency terms but dollar appreciation resulted in Overseas Equities INVESTMENT REPORT Page 11 gained in the second half of the year. Fixed interest gilt returns were weaker than their index-linked gilt counterparts across maturities as breakevens 3.8%, 11.5% and 12.1% respectively. counterparts. This was also true of index-linked guts where short, medium and long maturities moved higher by Long dated fixed interest gilts climbed the most (8.1%), outperforming its short (1.6%) and medium (5.5%) up. UK gilts moved up over the year, fluctuating with the change in safe haven flows as the Eurozone crisis flared Gilt Markets The yen depreciated 8.6% against sterling. 2012, as well as January 2013). The asset purchase fund expanded by 10tn, 11tn and 10tn respectively. The BoJ finished the year with rates at 0-0.1% and announced three rounds of QE (in September and October The ECB cut rates to 0.75% in July 2012 and the euro has appreciated 1.4% over the year against sterling. September 2012, with an indefinite term. The US dollar strengthened 5.0% against sterling over the year. of long-term treasuries funded from the sale of shorter term issues) to December QE3 was announced in The Federal Funds rate remained exceptionally low at %. The Fed continued Operation Twist (purchase uncertainty regarding a referendum which may lead to an EU exit. programme size to 375bn. The UK economy struggled to achieve positive real growth rates and faced announced a round of quantitative easing (50bn) in July This brought the total asset purchase Official Bank of England ( B0E ) rates stayed at 0.5%, unchanged since March During the year, the BoE Currencies and Interest Rate sectors. index. Health Care (33.6%), Consumer Services (27.5%) and Financials (23.6%) were the best performing Basic Materials (-0.4%) and Technology (3.3%) were the worst performing sectors in the FTSE All World ex UK economic data releases and disappointment over the Chinese recovery. Emerging Markets returns were the weakest in local currency (5.5%) and sterling (7.7%) terms due to poor Abe at the helm and B0J Governor Kurodas appointment led to a more aggressive monetary policy stance. terms due to yen weakness. The Liberal Democratic Partys victory in the General Elections with Prime Minister Japanese equities returns were the strongest in local currency terms (24.1%) but only rose 14.3% in sterling Greek bail-out. The improving situation was confirmed by European banks repaying crisis loans quicker than anticipated. programme gave investors confidence in ECB support to the peripheral countries and there was relief over the Continental European equities gained 15.9% in local currency terms and 18.0% in sterling terms. The OMT.,.l.., -

14 INVESTMENT REPORT Fixed Interest and Index-Linked Markets Fixed interest gilt yields declined across the curve from levels seen a year-ago. Index-linked gilt yields fell across the yield curve and all maturities ended the year in negative territory. UK Investment Grade Credit iboxx non-gilts UK credit spreads (the difference between the yields on non-government bonds and equivalent maturity government bonds) dropped 68 bps to 162 bps over the year. This led to outperformance against government bonds. Credit spreads moved down the most for BBB-rated issues whilst AAA-rated spreads reduced the least. As credit spreads decreased and government bond yields declined, non-gilts rose 12.0% over the year. UK Property The IPD Monthly Index moved up by 2.5% over the year. The income return climbed 6.8%, however capital growth and rental value growth fell 4.0% and 0.1% respectively. Provided by Aon Hewitt Limited Page 12

15 Scheme year which: to make available to Scheme members, beneficiaries and certain other parties, audited accounts for each The audited accounts are the responsibility of the Trustees. Pension Scheme regulations require the Trustees I. STATEMENT OF TRUSTEES RESPONSIBILITIES Page 13 Date: Trustee: -..D Trustee: Signed for and on behalf of the Trustees: detect fraud and other irregularities, including the maintenance of an appropriate system of internal control. taking such steps as are reasonably open to them to safeguard the assets of the Scheme and to prevent and The Trustees also have a general responsibility for ensuring that adequate accounting records are kept and for and 2004 to consider making reports to the Pensions Regulator and the members. contributions) payable towards the Scheme by or on behalf of the employer and the active members of the Contributions. Where breaches of the Schedule occur, the Trustees are required by the Pensions Acts 1995 monitoring whether contributions are made to the Scheme by the Employer in accordance with the Schedule of from time to time revised a schedule of contributions showing the rates of contributions (other than voluntary for keeping records in respect of contributions received in respect of any active member of the Scheme and for Scheme and the dates on or before which such contributions are to be paid. The Trustees are also responsible The Trustees are responsible under pensions legislation for ensuring that there is prepared, maintained and of an Annual Report. The Trustees are also responsible for making available certain other information about the Scheme in the form be applied consistently, making any estimates and judgements on a prudent and reasonable basis. The Trustees have supervised the preparation of the accounts and have agreed suitable accounting policies, to Recommended Practice, Financial Reports of Pension Schemes (Revised May 2007). including a statement whether the accounts have been prepared in accordance with the Statement of (Requirement to obtain Audited Accounts and a Statement from the Auditor) Regulations 1996, - contain the information specified in the Schedules to the Occupational Pension Schemes Accounting Practice), and liabilities to pay pensions and benefits after the end of the Scheme year, in accordance with the amount and disposition at the end of the Scheme year of the assets and liabilities, other than - show a true and fair view of the financial transactions of the Scheme during the Scheme year and of applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted

16 Kingdom Generally Accepted Accounting Practice). comprise the fund account, the net assets statement and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United We have audited the accounts of The CAP Group Pension Scheme for the year ended 31 March 2013 which Independent auditors report to the Trustees of the The CAP Group Pension Scheme INDEPENDENT AUDITORS REPORT TO THE TRUSTEES -,. Page 14 Date: R cpi-q.r CF1O 3PW Cardiff One Kingsway Chartered Accountants and Statutory Auditors PricewaterhouseCoopers LLP 1996, made under the Pensions Act Schemes (Requirement to obtain Audited Accounts and a Statement from the Auditor) Regulations - contain the information specified in Regulation 3 of, and the Schedule to, the Occupational Pension Practice; and - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting - show a true and fair view of the financial transactions of the scheme during the year ended the liabilities to pay pensions and benefits after the end of the year; 31 March 2013, and of the amount and disposition at that date of its assets and liabilities, other than In our opinion the accounts: Opinion on the accounts all the financial and non-financial information in the trustees report to identify material inconsistencies with the accounting estimates made by the Trustees and the overall presentation of the accounts. In addition, we read audited accounts. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report. circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant error. This includes an assessment of: whether the accounting policies are appropriate to the Scheme s reasonable assurance that the accounts are free from material misstatement, whether caused by fraud or An audit involves obtaining evidence about the amounts and disclosures in the accounts sufficient to give Scope of the audit of the accounts hands it may come save where expressly agreed by our prior consent in writing. assume responsibility for any other purpose or to any other person to whom this report is shown or into whose with Section 41 of the Pensions Act 1995 and for no other purpose. We do not in giving this opinion, accept or This report, including the opinion, has been prepared for and only for the Trustees as a body in accordance Standards for Auditors. preparation of the accounts and being satisfied that they show a true and fair view. Our responsibility is to audit and express an opinion on the accounts in accordance with applicable law and International Standards on As explained more fully in the statement of Trustees responsibilities, the Trustee are responsible for the Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board s Ethical Respective responsibilities of the Trustees and Auditors i

17 Note FOR THE YEAR ENDED 31 MARCH 2013 FUND ACCOUNT Page 15 The notes on pages 17 to 23 form an integral part of these accounts. At 31 March 32,877,811 27,693,731 Closing assets of the Scheme At 1 April 27,693,131 26,434,664 Opening assets of the Scheme Net increase in the Scheme Net returns on investments Investment income Investment management expenses 10 7,410 Change in market value of investments Returns on investments Net additions from dealings with members Payments to and on account of leavers Benefits Administrative expenses Other income Contributions 3 1,825,218 7,443,736 75,576 1,825,218 7,459,372 5 (276,184) (775,695) 6 (4,111) (79,295) 7 (249,935) (289,631) (530,230) (484,821) 1,294, , ,768, ,497 87, ,669 77,249 3,889, ,776 5,184,680 7,258, Contributions and Benefits 1

18 AS AT 31 MARCH 2013 NET ASSETS STATEMENT Page 16 Date:. Trustee: il7t1 HIcIcb Trustee: These accounts were approved by the Trustees and were signed on their behalf by: The notes on pages 17 to 23 form an integral part of these accounts. conjunction therewith. with in the Actuarial Statement on pages 26 to 32 of the Annual Report and these accounts should be read in the Scheme year. The actuarial position of the Scheme, which does take account of such obligations, is dealt Trustees. They do not take account of obligations to pay pensions and benefits which fall due after the end of The accounts summarise the transactions of the Scheme and deal with the net assets at the disposal of the Net Assets of the Scheme 32,877,811 27,693,731 Current assets Current liabilities Investment assets 9 32,793, , (126,813) (778,705) I 78,733 27,633,703 Note THECAP GROUP PENSION SCHEME

19 The accounts have been prepared in accordance with the Occupational Pension Schemes BASIS OF PREPARATION NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2013 Page 17 accruals basis. Administrative expenses and Investment management expenses are accounted for on an 2.5 Administrative and Investment management expenses AVC funds are included at the market value advised by the fund managers at the year end. Pooled Investment Vehicles are valued at the closing bid price if both bid and offer prices are published, or at the closing single price or dealing price as advised by the investment manager. 2.4 Valuation of investments Income on cash deposits is dealt with in these accounts on an accruals basis. accounted for on an accruals basis. Income from segregated holdings and pooled investments vehicles which distribute income, is 2.3 Investment income Benefits to members are accounted for in the period in which they fall due. Individual transfer values to and from other pension schemes are accounted for on a cash basis. Other income is accounted for on cash basis. Contributions. Deficit funding is accounted for in the period in which it falls due in line with the Schedule of All contributions payable under salary sacrifice are classified as Employer contributions. Contributions, including voluntary contributions, are accounted for in the period in which they fall due. 2.2 Contributions, benefits and payments to leavers Unless otherwise stated the accounts have been prepared on an accruals basis. 2.1 Accruals concept The following principal accounting policies have been adopted in the preparation of the accounts. 2. ACCOUNTING POLICIES Schemes (SORP) (revised May 2007). with the guidelines set out in the Statement of Recommended Practice, Financial Reports of Pension (Requirement to obtain Audited Accounts and a Statement from the Auditor) Regulations 1996, and I-

20 NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2013 Page 18 Individual transfers to other schemes 4,111 79, PAYMENTS TO AND ON ACCOUNT OF LEAVERS 276, ,895 Commutations and lump sum retirement benefits 188,514 38,338 Pensions 87,670 77, BENEFITS Other income 75, OTHER INCOME Each year, the participating members receive statements prepared by Equitable Life Assurance Society and the Prudential Assurance Company Limited detailing their individual accounts. to provide additional benefits within the overall limits laid down by HM Revenue & Customs. arrangements under which contributions are received and invested on behalf of the individuals concerned Members are permitted to make Additional Voluntary Contributions (AVCs) into money purchase type that total employer contributions must be equal to (2012: 900,000) plus 7.5% towards those members electing for salary sacrifice. Deficit funding contributions are payable until March Deficit funding contributions were received in accordance with the Schedule of Contributions, which states 1,825,218 7,443,736 additional voluntary contributions 5,118 5,718 normal Members deficit funding 424,676 normal Employers PPF levy 137, ,148 1,257,433 1,066, , CONTRIBUTIONS

21 ADMINISTRATIVE EXPENSES NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2013 reconciliation to show income gross. Increase in investment income in the current year is a result of tax Interest on cash deposits Income from pooled investment vehicles 8. INVESTMENT INCOME Sundry expenses Bank charges PPF Levy Legal fees Audit fee Actuarial fees Administration and processing Page 19.4 vouchers receipt and proper 113,475 87, ,167 87, , , , , ,250 2,502 47,681 10,830 77,764 49,692 47,895

22 MOVEMENTS IN INVESTMENTS FOR THE YEAR ENDED 31 MARCH 2013 NOTES TO THE ACCOUNTS Page 20 32,497,636 27, 788,175 Unit Trusts - Managed funds - Managed funds - property property - 2,693,744 other 2,748,722-29,748,914 24,494, POOLED INVESTMENT VEHICLES Transaction costs are included in the cost of purchases and sale proceeds. Transaction costs include amount of indirect costs is not separately provided to the Scheme. costs charged directly to the Scheme such as fees, commissions, stamp duty and other fees. Indirect costs are incurred through bid-offer spread on investments within Pooled Investment Vehicles. The funds, change in market value also includes income net of witholding tax which is reinvested in the fund. sales of investments during the year. In the case of pooled investment vehicles which are accumulation The change in market value of investments during the year comprises all increases and decreases in the market value of investments held at any time during the year, including profits and losses realised on 27,633,703 32,793,790 20,783 12,374 Dividends and withholding Cash deposits 43,453 Cash in transit 201,000 tax 126,017 Sub total 27,368,462 4,821,360 (3,303,230) 3,768,807 32,655,399 AVC investments 180,346 5,118 (39,335) 11, ,763 Pooled investment vehicles 27,188,116 4,816,242 (3,263,895) 3,757,173 32,497, cost proceeds market value 31/ Value at Purchases at Sales Change in Value at 9. INVESTMENTS

23 CASH DEPOSITS 9 Investments (continued) FOR THE YEAR ENDED 31 MARCH 2013 NOTES TO THE ACCOUNTS Page 21 6,195, % 4,951, % 3,822, ¾ 2,479,574 2,408,963 2,748,723 4,410,292 13% 5,186,984 4,088,798 3,777,363 3,266,756 2,693,744 1,876,400 1,940,337 12% 70% 7% 7% 79% 15% 14% 2013 Scheme s net assets as at 31 March Schroder Life Diversified Growth Fund Schroder UK Alpha Plus Fund Schroder Long Dated Corporate Bond Fund Schroder UK Property Fund GBP I Income Schroder Exempt Property Unit trust L&G UK Equity Index L&G Europe (ex UK) lndex-gbp Hedged L&G North America Equity Index-GBP Hedged 8% 8% 7% Market value Market value The following investments, excluding UK Government securities, 2012 account for more than 5% of the CONCENTRATION OF INVESTMENTS 157, ,346 Global equity fund Discretionary fund 112,455 2,514 18,486 76,107 Building society accounts With profits fund Managed funds 17,485 6,823 6, ,528 9,033 16, The total amount of AVC investments at the year end is shown below. confirming the amounts held to their account and movements during the year. Members participating in this arrangement receive an annual statement made up to 31 March each year, contributions. The Trustees hold assets which are separately invested from the main fund. These secure additional benefits, on a money purchase basis, for those members who have elected to pay additional voluntary AVC INVESTMENTS Sterling cash deposits 126,017 43, ! 1

24 ... NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MARCH INVESTMENT MANAGEMENT EXPENSES Administration, management & custody Investment fee rebate ,751 30,705 (49,161) (47,954) (7,410) (17,249) 11. CURRENT ASSETS AND LIABILITIES Current assets Employer contributions due Employee contributions due Prepaid pensions Cash balances , ,124 48, , ,638 57, , ,133 Current liabilities Unpaid benefits Accrued expenses Due to LLR Scheme Other Creditors HM Revenue & Customs 21,769 93,049 4,750 5,805 1, ,080 4,750 5,805 2, , ,705 Current assets and liabilities 84,021 59,428 All contributions excluding PPF levies due to the Scheme relate to the month of March 2013 and were paid in full to the Scheme within the timescale required by the Schedule of Contributions currently in force. 12. RELATED PARTY TRANSACTIONS The Trustees noted on page 1 were all members of the Scheme in the past year. All transactions with these parties were in accordance with scheme rules. Other than those items disclosed elsewhere in the accounts there were no other related party transactions during the year. Page 22

25 NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MARCH EMPLOYER RELATED INVESTMENTS The Scheme is invested in accordance with the Occupational Pension Schemes (Investment of Scheme s Resources) Regulations 1992, and there is no self-investment in the Scheme (that is, investment in the principle employer s shares, loans or property), other than the outstanding contributions described below. The Scheme has employer related investments as defined in the Pensions Act The market value of these investments at the year end is shown below. PPF levies in respect of year 2012 and 2013 in amount of 10,617 have not been reimbursed by the Employer. This amount is included in employer contributions due. 14. CONTINGENT LIABILITIES AND CONTRACTAL COMMITMENTS In the opinion of the Trustees the Scheme had no contingent liabilities or contractual commitments at 31 March 2013 (2012: nil) 15. SUBSEQUENT EVENTS There were no subsequent events requiting disclosure in the accounts. Page 23

26 ended 31 March 2013 which is set out on the following page. We have examined the Summary of Contributions to The CAP Group Pension Scheme for the scheme year Scheme Independent Auditors Statement about Contributions to the Trustees of The CAP Group Pension INDEPENDENT AUDITORS STATEMENT ABOUT CONTRIBUTIONS FOR THE YEAR ENDED 31 MARCH 2013 Page 24 Date: L, CFIO 3PW Cardiff One Kingsway Chartered Accountants and Statutory Auditors PricewaterhouseCoopers LLP LL with the Schedule of Contributions certified by the Scheme Actuary on 6 February March 2013 as reported in the Summary of Contributions have in all material respects been paid in accordance In our opinion, the contributions required by the Schedule of Contributions for the Scheme year ended 31 Statement about contributions to the Scheme Scheme under the Schedule of Contributions and the timing of those payments. reported in the Summary of Contributions have been paid in accordance with the relevant requirements. This includes an examination, on a test basis, of evidence relevant to the amounts of contributions payable to the Our examination involves obtaining evidence sufficient to give reasonable assurance that contributions Scope of work on the statement about contributions whose hands it may come save where expressly agreed by our prior consent in writing. orassume responsibility for any other purpose or to any other person to whom this report is shown or into with section 41 of the Pensions Act 1995 and for no other purpose. We do not, in giving this opinion, accept This report, including the opinion, has been prepared for and only for the Trustees as a body in accordance It is our responsibility to provide a statement about contributions and to report our opinion to you. requirements. for ensuring that there is prepared, maintained and from time to time revised a schedule of contributions and As explained more fully in the statement of Trustees responsibilities, the Scheme s Trustees are responsible for monitoring whether contributions are made to the Scheme by the Employer in accordance with relevant Respective responsibilities of Trustees and Auditors :

27 31 March 2013 Trustees Summary of Contributions payable under the Schedule in respect of the Scheme year ended FOR THE YEAR ENDED 31 MARCH 2013 SUMMARY OF CONTRIBUTIONS PAID DURING THE YEAR, Page 25 Lt Trustee: okn 1Ic.Icjc Signed on behalf of the Trustees: Total contributions reported in the accounts 1,825,218 Employee additional voluntary contributions 5,118 Contributions payable under the Schedule (as above) 1,767,079 Contributions payable in addition to those due under the Schedule: Overpayment of deficit contributions 53,021 of the Scheme year Reconciliation of contributions payable under the Schedule of Contributions reported in the accounts in respect Reconciliation of contributions Contributions payable under the Schedule 1767,079 PPF Levy 137,461 Employees Contributions deficit 371,655 normal 1257,433 normal 530 Employers Contributions Contributions payable under the Schedule in respect of the Scheme year contributions payable under the Schedule in the Auditors Statement about Contributions. dated 6 February 2012 in respect of the Scheme year ended 31 March The Scheme Auditor reports on It sets out the employer and member contributions payable to the Scheme under the Schedule of Contributions This Summary of Contributions has been prepared by, or on behalf of, and is the responsibility of the Trustees. z2

28 Schedule of Contributions The CAP Group Pension Scheme Status ACTUARIAL STATEMENTS Page 26 schedule above. above. The risk based element of the Pension Protection Fund levy is paid separately and is not included in the The cost of Scheme based element of the Pension Protection Fund levy is included within the schedule shown The cost of professional fees and other Scheme expenses is included in the above schedule. of the calendar month to which the contribution relates. The Participating Employer will ensure that the Trustees receive these contributions within 19 days of the end benefits date of certification of this those members who elect to participate and ending on 31 March 2020 the recovery plan paid by the Employer over period is 0.90m + 7.5% of pensionable salary sacrifice schedule by the Scheme actuary in salary sacrifice, or earnings for those members electing the recovery plan 2012 and ending on 31 March paid by the Employer over each year salary sacrifice earnings for those members electing is 1.25m + 7.5% of pensionable 2020 (from 1 April to 31 March) in the period Additional contributions to satisfy 1 April 2011 to 31 March 2012 A fixed amount so that the total amount Additional contributions to satisfy The period commencing 1 April A fixed amount so that the total amount participate in salary sacrifice those members who elect not to 17.1% of pensionable earnings for In respect of future accrual of The period commencing with the 24.6% of pensionable earnings for Type Period Amount The Employers will contribute to the Scheme as follows: Employer contributions The Schedule covers contributions to the Scheme from Calsonic Kansei UK Limited. Participating Employers Schemes Trustees ate responsible for preparing a revised Schedule no later than 30 June date of certification of this schedule by the Scheme Actuary and covers the period to 31 March The This Schedule of Contributions is required by Section 227 of the pensions Act It comes into effect on the

29 L... ACTUARIAL STATEMENTS Employee Contributions Employees who are active members of the Scheme will contribute to the Scheme as follows: Period Amount The period commencing with the date of certification 7.5% of pensionable earnings or nil if they have of the Schedule by the Scheme actuary and ending on elected for salary sacrifice 31 March 2020 These amounts do not include members Additional Voluntary Contributions. The Employer will ensure that the Trustees receive these contributions payable by their employees within 19 days of the end of the calendar month in which the contributions were deducted from the employees salaries. Signed on behalf of the Scheme Name JDIXON Position Trustee Date: 2 February 2012 Signed on behalf of the Employer Name DAVID CAMPBELL Position Director Date: 3 February 2012 Page 27

30 Adequacy of rates of contributions Name of scheme: The CAP Group Pension Scheme Actuarial Certificate of Schedule of Contributions ACTUARIAL STATEMENTS Page 28 BSJ 4AQ Bristol Address: 25 Marsh Street Employer: Aon Hewitt Limited Name: David Higgs Qualification: Fellow of the Institute and Faculty of Actuaries Signature: DAVID HIGGS Date: 6 February 2012 the Scheme s liabilities by the purchase of annuities, if the Scheme were to be wound up. funding objective can be expected to be met is not a certification of their adequacy for the purpose of securing The certification of the adequacy of the rates of contributions for the purpose of securing that the statutory Principles dated 3 February Adherence to Statement of Funding Principles dated 3 February statutory funding objective can be expected to be met by the end of the period specified in the recovery plan I certify that, in my opinion, the rates of contributions shown in this schedule of contributions are such that the I hereby certify that, in my opinion, this schedule of contributions is consistent with the Statement of Funding : IHECAP GROUP PENSION SCHEME

31 Name of Scheme: The CAP Group Pension Scheme Actuarial Certification of the calculation of Technical Provision ACTUARIAL STATEMENTS Page 29 BSI 4AQ Bristol Address: 25 Marsh Street Employer: Aon Hewitt Limited Name: David Higgs Qualification: Fellow of the Institute and Faculty of Actuaries Signature: DAVID HIGGS Date: 6 February 2012 dated 3 February assumptions determined by the Trustees of the Scheme and set out in the Statement of Funding Principles accordance with regulations under section 222 of the Pensions Act The calculation uses a method and I certify that, in my opinion, the calculation of the Schemes technical provisions as at 31 March 2011 is made in Calculation of technical provisions

32 the Trustees must, by law, provide you with an annual update on the funding position. It is part of the Trustees responsibility to make sure that a full valuation is carried out every 3 years. In addition, Summary Funding Statement 2013 ACTUARIAL STATEMENTS. Page 30 Calsonic pays the risk based f3 circumstances. No such directions have ever been made in relation to the Scheme. The Pensions Regulator has powers to direct matters affecting the funding of the Scheme in certain element of the Pension Protection Fund levy in addition. - Plus member s salary exchange contributions m per annum from 1 April 2012 to 31 March 2020 From April 2012, Calsonic will pay total contributions of: Asset ( current money available) 26.3m meet the liabilities (known as full solvency ) 42% Estimate of funding level if the Twstees were required to buy insurance policies to Funding level (on an ongoing basis) 88% Deficit (shortfall because liabilities are higher than assets) (f3.7m) Liabilities (amount required now to provide benefits) 30.Om The latest valuation showed that as at 31 March 2011 the funding position on an ongoing basis was: statement shows the change in funding position since the previous update. investment return. The latest valuation was carried out as at 31 March 2011, and this summary funding long members might live, the likely level of future salary increases and the long-term rates of inflation and The Actuary estimates the cost of future Scheme benefits based on a number of assumptions including how What are the results of the last valuation? the objective to pay pensions and other benefits. agreement with Calsonic on the amount of contributions needed to keep the Scheme funding on track to meet assets that is needed today to meet the benefit payments. Using this information, the Trustees arrive at an The Trustees obtain regular valuation reports from the Actuary that provides an estimate of the amount of you have chosen to pay Additional Voluntary Contributions, these ate kept separate from the main fund. pensions and other benefits to members. You also pay contributions into the Scheme (through salary exchange) to help pay for your benefits. Members do not have separate individual holdings within the fund. If Calsonic Kansei UK Limited ( Calsonic ) pays contributions so that the Scheme can build up a fund to pay How is my pension funded?

33 funding valuation as at March 2012, the funding position has decreased to a funding level of around 70%. This The funding position is monitoted between valuations. Between the last valuation at March 2011 and the new Change in funding position ACTUARIAL STATEMENTS Page 31 those typically used by insurers. will continue to financially support the Scheme and it includes less cautious assumptions about the future than profit margin and make an allowance for their expenses. By contrast, our funding plan assumes that Calsonic estimating the cost to provide policies, insurers are requited to take a very cautious view of the future, include a The full solvency position assumes that members benefits will be secured by buying insurance policies. When Why does the Trustees funding plan not call for full solvency at all times? paid in full. Scheme remains ongoing, even though funding may temporarily fall below target, pensions will continue to be you have earned, even if the Scheme is fully funded against its target funding level. However, whilst the If the Scheme winds up because Calsonic becomes insotvent you may not receive the full amount of pension What would happen if the Scheme started to wind up? the previous year. As required by legislation, we confirm that there has not been any payment to Calsonic out of Scheme funds in - The cost of benefits may increase, which would result in Calsonic having to contribute more money. in more money; and - Assets can go down as well as up, and when there is a shortfall, Calsonic will usually be requited to put However, this relies on Calsonic continuing in business and supporting the Scheme because: The Trustees objective is to have enough money in the Scheme to pay pensions now and in the future. The importance of the Companys support March 2013 and are likely to report this to you next year. The next Actuarial Valuation will be as at 31 March 2014, although the Trustees will review the position as at 31 future. performance, interest rates and life expectancy. This means that the funding level can go up or down in the You should be aware that the factors affecting the funding level ate very changeable, particularly stock market the Scheme. of reducing the amount of future investment income we are expecting to get and hence increased the cost of fall has primarily due to the significant fall in the yields available on government stock (gilts). This has the effect

34 j ACTUARIAL STATEMENTS Pension Protection Fund (PPF) The PPF was set up in April 2005 to protect your pension benefits. It is a type of compensation scheme and an annual levy has to be paid to the PPF from final salary arrangements like ours. The PPF will compensate scheme members if an employer becomes insolvent and its scheme does not have enough money to pay members benefits, but any payments would generally be less than the full amounts due. Further information and guidance is available on the PPF s website at What is the Scheme invested in? The Trustees invest in a broad range of assets to get the best return possible while taking account of the liabilities of the Scheme. They also consider the risks associated with having too much money in any one type of investment. The Trustees currently have a strategic benchmark of the following: Equities (company shares) 58% Diversified growth fund 18% Property 10% Bonds issued by companies and the government 12% Global Asset Allocation 2% Where can I get further information? If you have any other questions on this statement, please contact: or would like any more information about the Scheme, Until 31 May2013 Aon Hewitt Limited 25 Marsh Street Bristol BS1 4AQ cappension@aon.co.uk From 31 May2013 Lane Clark & Peacock LLP St Paul s House St Paul s Hill Winchester AB team-llradmin@lcp.uk.com Documents you may wish to see are: the Statement of Investment Principles, the Schedule of Contributions, the Scheme s Annual Report and Accounts, and the Actuarial Valuation as at 31 March 2011 (a charge may apply). Please help us to keep in touch with you by telling us if you change your address. If, for any reason you are considering leaving the Scheme, you should consult an appropriate financial adviser before taking any action. April 2013 Page 32

35 4 COMPLIANCE STATEMENT FOR THE YEAR ENDED 31 MARCH 2013 HM Revenue & Customs registration The Scheme is a registered pension scheme in accordance with The Finance Act This means that the contributions paid by both the Company and the members qualify for full tax relief, and enables income earned from investments by the Trustees to receive preferential tax treatment. Other information fi) Pension Tracing The Scheme is registered with the Pension Tracing Service which maintains a list of up to date addresses of schemes to assist ex-members trace their rights if they have lost contact with the previous employers scheme. The address for the Pension Tracing Service is: The Pension Tracing Service Tyneview Park Whitley Road Newcastle Upon Tyne NE98 1BA (ii) Resolving difficulties!lnternal Dispute Resolution It is expected that most queries relating to benefits can be resolved with the Schemes administration office. In the event that a complaint cannot be resolved members can make a formal complaint using the Schemes Internal Dispute Resolution (IDR) procedure details of which can be obtained from the Trustees office. The Pensions Advisory Service (TPAS) can assist members in taking their complaint through the IDR procedure. TPAS is an independent organisation which can help members of the public deal with pension problems. The name and address of the local TPAS adviser can. be obtained from any local Citizens Advice Bureau or from The Pensions Advisory Service Limited 11 BeIg rave Road London SWIV IRB If the complaint is not resolved satisfactorily, the Government appointed Pensions Ombudsman can investigate complaints of injustice by bad administration either by the Trustees or the Scheme Administrators, or disputes of fact of law. The Pensions Ombudsman can be contacted at: The Pensions Ombudsman I I Belgrave Road London SW1V 1RB Page 33

36 COMPLIANCE STATEMENT FOR THE YEAR ENDED 31 MARCH 2013 (iii) The Pensions Regulator The Pensions Regulator (TPR) is the UK regulator of work-based pension schemes. TPR s role is to act to protect the interest of pension to occupational pensions. scheme members and to enforce the law as it applied The regulations out clearly the that TPR covers and the powers that are vested in it. For example, TPR can prohibit or disqualify for acting unlawfully, and can impose fines on wrongdoers. set TPR can be contacted at: The Pensions Regulator Napier House Trafalgar Place Brighton BN1 4DW customersupport@tpr.gov.uk areas Trustees (iv) The Pension Protection Fund The Pension Protection Fund was benefit pension when where there insufficient compensation. are schemes, assets established to provide compensation to members of eligible defined is a qualifying insolvency event in relation to the employer and in the pension to cover Pension Protection Fund levels of there scheme The Pension Protection Fund is a statutory fund run by the Board of the Pension Protection Fund, a statutory corporation the provisions of the Act The Pension Protection Fund became operational on 6 April established under Pensions (v) Scheme information The Trust Deed and Rules, the details and a copy of the Schedule of Contributions and of Investment Principles available for inspection, free of charge, by contacting the at the shown for enquiries in this report. Statement address Scheme are Trustees Any information relating to the members own pension position, including of transfer value, should be from the administrators of the at the detailed in this report. requested Scheme address estimates Page 34