~ ~ Net assets in the Plan are $30.2 million ~ ~ More flexible investment choices see page 1 ~ ~ The Federal Budget and your super see page 8

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1 Nissan Superannuation Plan ~ ~ Net assets in the Plan are $30.2 million ~ ~ More flexible investment choices see page 1 ~ ~ The Federal Budget and your super see page 8

2 in this report Welcome from the Trustee 1 Your 2015/16 investment returns 2 Your Plan s investments 4 FEATURE: THE FEDERAL BUDGET AND YOUR SUPER 8 How super is taxed 9 Fees and other costs 10 About the Plan 12 Financial summary back cover Contact us General enquiries The Plan administrator Nissan Superannuation Plan PO Box 1442 Parramatta NSW 2124 Phone: Fax: (02) nissansuperadmin@linksuper.com Website: nsp.nissan.com.au The Trustee The Plan Secretary Towers Watson Superannuation Pty Ltd C/- Towers Watson Australia Pty Ltd Level 23, 55 Collins Street Melbourne Victoria, 3000 Phone: Your Annual Report This Annual Report has been prepared for members of the Nissan Superannuation Plan (ABN ). It reviews the Plan s performance and super developments for the past 12 months and covers how the Plan is managed. The information in this document 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. Information on tax and superannuation legislation is current as at the date of publication and may change. Issued by Towers Watson Superannuation Pty Ltd (ABN , AFSL ) as Trustee of the Nissan Superannuation Plan. Preparation of this Annual Report was completed on 17 June 2016.

3 welcome From the Trustee We present the for members of the Nissan Superannuation Plan ( the Plan ) for the year to 31 March Inside, you can learn more about the Plan s investment performance for the year and read the latest super news. Your 2015/16 super performance It s been a difficult year for investment markets which were volatile over the Plan s year which ended on 31 March Both the Australian and international share markets experienced dramatic swings throughout the year and ultimately lost ground. This adversely impacted the Plan s Growth and Balanced 50/50 options, which both have a significant proportion of assets invested in shares. A combination of factors the timing of the Plan s year-end (i.e. 31 March) and the losses from share investments have seen the Plan record negative returns for the first time since the 2008 Global Financial Crisis. However, it s important to remember that superannuation is a long term investment and the Plan has delivered excellent returns to members over the longer term. The average net return for the Plan s Growth option over the past five years has been 7.96% p.a. and 5.96% p.a. over 10 years. Compared to CPI at 1.9% p.a. and 2.5% p.a. respectively, these are very strong real rates of return. The Plan s results also continue to compare very favourably with superannuation funds that have similar asset allocations. See the chart to the right for how each option performed during the year and over the longer term. A detailed investment update appears on pages 2 to 3 along with a history of the Plan's investment returns. If you are a Defined Benefit member, the defined benefit part of your super is generally not affected by investment returns, but instead linked to your salary. However, accumulation accounts and any additional voluntary contribution and rollover accounts you have will be affected by investment returns. Federal Budget proposals The 2016 Federal Budget contained a number of super-related proposals. Most of these will only start from 1 July 2017 if the necessary legislation is passed. Read page 8 for a summary of what is proposed and what this could mean for you. More flexible investment choices introduced Investment choice is now available on all accounts for Accumulation members and on additional voluntary and rollover accounts for Defined Benefit members. In March 2016, the Plan introduced more flexibility allowing you to split your total account balance across the Plan s three investment options. Greater flexibility lets you tailor the most appropriate option or combination of options for your personal circumstances. To learn more about the Plan s investment options, see pages 6 to 7. As Trustee, our role is to manage the Plan for your benefit. As always, we welcome your questions and feedback. Our contact details are on the inside cover. The Trustee Nissan Superannuation Plan Overview of your Plan The Plan's performance at 31 March Past performance is not necessarily a reliable indicator of future performance Growth Note: Investment returns are net of fees, tax and where applicable, an allowance for the build up of the Operational Risk Financial Requirement reserve. * The Balanced 50/50 and Cash investment options were introduced on 1 April The compound average net returns shown in the graph above are for the four-year period from 1 April Plan assets $M % Balanced 50/50* Cash* 30,242, % 33,702, % % 7.75% 2.30% Five-year compound average net return (per year) Membership* % 10-year compound average net return (per year) *Membership totals include members who have left Nissan but have elected to continue membership in the Retained Benefits Division. 1

4 Your 2015/16 investment returns The table below shows the Plan s investment returns. Remember that how your super performs will vary from year to year. Super returns can be positive or negative depending on investment markets. In most cases, super is a long-term investment. This means that returns over a longer term (such as ten years, rather than one or two years) are likely to be a better indicator of your super s performance. A history of your returns Past performance is not necessarily a reliable indicator of future performance. Investment option Five-year compound average return (per year) 10-year compound average return (per year) Growth -4.12% 16.14% 12.17% 14.43% 2.60% 7.96% 5.96% Peer fund comparison # -1.19% 13.13% 12.39% 10.49% 1.17% 7.19% 5.04% Balanced 50/ % 13.38% 8.98% 11.41% N/A N/A N/A Peer fund comparison # -0.76% 10.83% 9.22% 8.72% N/A N/A N/A Cash 1.72% 2.20% 2.26% 3.04% N/A N/A N/A Defined Benefit* -2.01% 13.47% 9.04% 11.41% 2.60% 6.75% 5.36% Note: Investment returns are net of investment fees, tax and where applicable, an allowance of 0.083% per year to build up the Operational Risk Financial Requirement (ORFR) reserve. See page 5 for further details. Returns are for periods to 31 March. The Balanced 50/50 and Cash investment options were introduced on 1 April 2012 and therefore no longer-term returns are available. # Peer fund comparisons are based on SuperRatings Pty Ltd s Fund Crediting Rate Survey median returns for the SR50 Balanced (60-76) Index and the SR25 Conservative Balanced Index, published on 19 April 2016, compared with the Plan s Growth and Balanced 50/50 options respectively, SuperRatings statistics are not financial product advice; independent professional advice should be obtained before making any financial decisions. * Up until 31 March 2012, the assets of Defined Benefit members were invested in what is now referred to as the Plan s Growth option. From 1 April 2012, the assets have been invested in the Balanced 50/50 option. The longer-term return figures take this into account. There are no deductions from defined benefit earnings for the build up of the ORFR reserve. Investment market update After a very strong 2015, the Australian share market fell by 9.3% for the year to 31 March The falls reflected declining commodity prices, a weaker financial sector, low growth and the close correlation between the Australian share market and global share markets. The Reserve Bank of Australia (RBA) noted some improved performance in the non-mining sectors of the Australian economy and expects this trend will continue. With the unemployment rate relatively steady at 5.7%, the RBA Board decreased the official cash rate to 1.75% in May 2016 as a further stimulus to the economy. This is a historical low for Australian official interest rates. Global share markets were volatile over the year. The main indicator for global shares, the MSCI World ex-australia Index, fell 3.8%. Often movements in the Australian dollar against other currencies will affect this result (i.e. global share returns are boosted by a weakening Australian dollar). However, since the Australian dollar was virtually unchanged against a basket of currencies over the year (for example, the Australian dollar was at US cents at the start of the year and moved to US cents by 31 March 2016), the effect of curerncy fluctuations on the Plan's international share holding was minimal. There was more encouraging economic news coming out of the US, with improving GDP and housing numbers. The Federal Reserve finally increased interest rates in December 2015 which represented the first increase in over a decade. Further increases are expected and the US share market is factoring in these increases. In the Eurozone, the economy began to show signs of recovery after Greece reached an agreement with its creditors in the middle of The Eurozone GDP grew 1.5% year-on-year in March 2016 and the unemployment rate has been dropping slowly but remains at an uncomfortably high 10.2%. Despite Eurozone news being marred by the Syrian refugee crisis, the Paris attacks and the Volkswagen scandal, markets continued to recover. Throughout the year the slowdown in China, reflected in declining commodity prices, falling stock markets and depressed economic data, caused concerns for global markets. The Shanghai Stock Exchange Composite Index which rallied strongly in the previous year fell by around 25% in the year to 31 March Despite efforts to stabilise the economy, including a devaluation of the local currency and multiple interest rate cuts, China s GDP growth for the year was a disappointing 6.7% the weakest annual growth for 25 years. 2

5 Returns from global listed property have been strong over previous years. Recent weakness in this sector saw a return of around 2.4%. Australian fixed interest also delivered modest returns for the year, with five and 10-year yields changing little during the year. While the Bloomberg AusBond Composite Bond Index (All Maturities) returned 2.0% for the year to 31 March 2016, the Plan's international fixed interest performed slightly better, with a return of 4.5%. Note: This investment commentary does not constitute advice. All investment figures quoted relate to the performance of the relevant industry benchmark. Your returns on your super Accumulation members Your accounts receive the actual investment return for your chosen option or options after allowing for investment fees, tax and an allowance for the build up of the Plan s ORFR reserve see page 5 for further details. The rates apply to accumulation accounts, including the additional voluntary contributions and rollovers of Defined Benefit members. The full year returns to 31 March 2016 for each investment option are shown on page 2. Investment returns can be positive or negative. Defined Benefit members Your retirement benefit is generally not affected by investment returns. This benefit is instead linked to your salary at or near retirement. What happens if I leave during the year? If your super needs to be paid out before monthly investment returns have been calculated, for instance if you leave Nissan or transfer to another super fund, an interim crediting rate will be used. This will cover the period from the date that investment earnings were last calculated until the date your benefit is paid. The interim crediting rate is based on the Plan s estimated monthly net investment returns in accordance with the Trustee s crediting rate policy. Interim rates may be either positive or negative and are calculated daily. If you switch investment options, an interim crediting rate will be applied to the part of your account that you re switching to calculate earnings at that time. If you are a Defined Benefit member, the defined benefit portion of your benefit will be converted to an accumulation-style benefit at your date of leaving. On transfer to the Plan's Retained Benefits Division, this portion of your benefit will be invested in the Balanced 50/50 option. You may change this investment choice at any time. To do this, complete a Change of Investment Choice Form, available from the Plan administrator or from the Plan s website at nsp.nissan.com.au. If you have additional accumulation accounts, they will continue to be invested in your current investment option. Investment returns are applied to your additional voluntary contribution and rollover accounts. Your accounts receive the actual investment return for your chosen option after allowing for investment fees, tax and an allowance for the build up of the Plan s ORFR reserve (see page 5 for further details). The Plan s defined benefit assets are invested in the Balanced 50/50 option. When determining the investment return of the Balanced 50/50 option for the purposes of your defined benefit accounts, there is no deduction for the build up of the ORFR reserve. Note that surcharge assessments (if any) are deducted from members benefits. Did you know? Generally, the higher the expected long-term return from an investment, the more likely it is that returns from that investment will fluctuate (or even be negative) in the short term. 3

6 Your Plan s investments One of the Trustee s roles is to set investment objectives for the performance of the Plan, and a strategy for achieving those objectives. Professional investment managers help the Trustee to manage the Plan s investments. The Plan has three investment options, each with different investment objectives and strategy, for you to choose from. You can choose one option or a combination of options. If you are an Accumulation member, you have a choice of how your entire super is invested. If you are a Defined Benefit member, you only have investment choice for your additional voluntary contribution and rollover accounts. As a member, choosing the most appropriate investment choice for your circumstances is very important. If you wish to change how your super is invested you should complete a Change of Investment Choice Form, available from the Plan administrator or from the Plan s website at nsp.nissan.com.au. You should consider obtaining financial advice before making any changes see page 13 on how to find a financial adviser. Investment objectives Investment objectives are specific goals that the Trustee sets for the performance of the Plan and each investment option. They are not intended as forecasts or guarantees of future investment returns. Generally, the Trustee aims to: ~ ~ Invest the Plan s assets prudently as permitted by the Trust Deed and by superannuation law, ~ ~ Invest across a diverse range of assets, ~ ~ Ensure that the Plan is able to make benefit payments to members when they are due, and ~ ~ Monitor the performance of the Plan s investment managers to ensure they exercise integrity, prudence and professional skill in fulfilling the investment tasks delegated to them. See pages 6 to 7 to learn more about the specific investment objectives for each investment option. The Trustee, in conjunction with the Plan s investment adviser, has reviewed the objectives of the Plan s investment options in light of the current low interest rate investment environment. As a result, in December 2015, changes were made to the real return objective of the Plan s Cash option, reducing the expected return over inflation to CPI + 0.5% p.a. (previously CPI + 1% p.a.). The Trustee expects this option to generate slightly lower real rates of return in the future, which will align more closely with the economic outlook for interest rates and inflation. Investment strategy An investment strategy is the plan the Trustee follows to achieve the objectives of an investment option. Each investment option has its own investment strategy. For the details of each option s investment strategy, see pages 6 to 7. Investment managers The Trustee appoints professional investment managers to manage the Plan s investments. These managers and their products may be changed from time to time without prior notice to, or consent from, members. During the year the Trustee replaced one of the Plan s investment managers. In August 2015, the Plan s global fixed income manager State Street Global Advisors was replaced by Blackrock Investment Management (Australia) Limited, using the Blackrock Global Bond Index Fund. The new investment fund has a lower annual fee and is expected to provide returns that closely match the global bond index. The Plan s investment managers at 31 March 2016 were: ~ ~ Schroder Investment Management Australia Ltd (Schroder Australian Equity Fund), ~ ~ Blackrock Investment Management (Australia) Limited (Blackrock Global Bond Index Fund), ~ ~ State Street Global Advisors (SSgA Australian Fixed Income Index Trust), ~ ~ Pinnacle Fund Services Limited (Resolution Capital Global Property Securities Fund Class B), ~ ~ Macquarie Investment Management Limited (Macquarie True Index Cash Fund), ~ ~ Macquarie Investment Management Limited (Macquarie Australian Pure Index Equities Fund), ~ ~ Macquarie Investment Management Limited (Arrowstreet Global Equity Fund), and ~ ~ MFS Institutional Advisors, Inc (MFS Fully Hedged Global Equity Trust). The Trustee is committed to the close monitoring of the Plan s investment managers and returns to ensure that the Plan continues to deliver competitive investment results to members each year. 4

7 Other investment information Derivatives The Trustee does not invest directly in derivatives. The Plan s investment managers may use derivatives for risk control purposes or to more efficiently change asset allocations. Derivatives are not used in a speculative manner. Investment managers are required to have risk management processes in place in relation to the use of derivatives and the purposes for which they are used. Each year, the Trustee obtains confirmation from the managers that they have complied with their processes. Deferred tax assets Super funds normally pay tax on capital gains. If a fund experiences capital losses (which can arise, for example, due to falls on share markets), they are allowed to accumulate the tax benefits associated with those losses and use them to offset the tax on future capital gains. Australian Accounting Standards require that future tax benefits will be recognised as a Deferred Tax Asset only to the extent that it is likely that future taxable gains will be available to utilise the capital losses. The Trustee has a formal policy to monitor the Plan s Deferred Tax Asset position in order for there to be an equitable allocation of tax benefits to all groups of members. As at the Plan s balance date (i.e. 31 March 2016), Deferred Tax Assets represented around 0.5% (previously 0.7%) of the Plan s assets. The Trustee may take action to limit the recognition of the Deferred Tax Asset in the Plan s financial statements. If this were the case, it would be necessary for the Trustee to adjust crediting rates accordingly. Actuarial review The Plan s financial position is reviewed by the actuary at least every three years. The actuary then makes recommendations to the Company on the appropriate level of future contributions needed to maintain members benefits. Reserves The Trustee does not maintain investment reserves. However, it does maintain an operational risk reserve as described below. Operational Risk Financial Requirement (ORFR) reserve From 1 July 2013, super funds have been required to set aside financial resources to address their operational risks. The Trustee has established an ORFR reserve in the Plan for this purpose. A reserve will be built up to 0.25% of the Plan s total vested benefits over the three years from 1 July The reserve will be funded in two ways. For accumulation-based benefits, the reserve will be funded by setting aside a small portion of the Plan s investment earnings. For defined benefits, the funding of the reserve will be achieved by setting aside amounts from the Plan s defined benefit assets. The Trustee has decided that the ORFR reserve will be invested in the Plan s Balanced 50/50 option. Once the reserve reaches its desired level, it will then be monitored periodically by the Trustee to ensure that it remains close to this level. Level of reserves As at 31 March ORFR reserve $/% of the Plan s vested benefits 2016 $68,401 (0.23%) 2015 $44,342 (0.14%) 2014 $13,574 (0.04%) The most recent review at 31 March 2013 showed that the Plan was in a satisfactory financial position. The Trustee monitors the Plan s financial position each quarter. The Company continues to contribute in line with the actuary s recommendations. The review for 31 March 2016 is currently underway and is expected to be completed by late A copy of the actuarial review report will be uploaded to the Plan s website as soon as it becomes available. 5

8 Your investment options What are the investment objectives for this option? Growth Real Return Objective ~ ~ To achieve a return (net of tax and investment fees) of at least 3% p.a. in excess of inflation (as measured by the Consumer Price Index (CPI)) over rolling 5-year periods. Downside Risk Objective ~ ~ To limit the probability of a negative return over rolling 12-month periods to 5 years in 20, or 25%. Likely 1 in 20 year adverse return -14.3% What investment strategy does this option use? How is the option invested at 31 March? To invest around 75% in growth assets and 25% in income assets % 5% 5% 4% 15% 35% 15% 35% 5% 5% 20% 15% 22% 14% Asset allocation range Australian shares 28% to 42% International shares (hedged) 10.5% to 24.5% International shares (unhedged) 10.5% to 24.5% Global listed property 3% to 7% Australian fixed interest 8% to 12% International fixed interest 8% to 12% Cash 3% to 7% Exposure ranges Growth assets 70% to 80% Income assets 20% to 30% 6

9 Balanced 50/50 Real Return Objective ~ ~ To achieve a return (net of tax and investment fees) of at least 2.5% p.a. in excess of inflation (as measured by the Consumer Price Index (CPI)) over rolling 5-year periods. Downside Risk Objective ~ ~ To limit the probability of a negative return over rolling 12- month periods (calculated each quarter) to 3-4 years in 20, or 18%. Likely 1 in 20 year adverse return -8.4% To invest around 50% in growth assets and 50% in income assets. Cash Real Return Objective ~ ~ To achieve a return (net of tax and investment fees) of at least 0.5% p.a. in excess of inflation (as measured by the Consumer Price Index (CPI)) over rolling 3-year periods. Downside Risk Objective ~ ~ To ensure that the amount invested will not decrease in value at any time. Likely 1 in 20 year adverse return N/A To invest 100% in cash % 10% 10% 10% 10% 10% 23% 23% 10% 10% 23% 23% 30% 30% 10% 10% 14% 14% 30% 30% 9% 9% 15% 15% 100% 100% 3% 3% 3% 3% cash ifi afi global property unhedged international Australian shares 16% to 30% International shares (hedged) 5% to 19% International shares (unhedged) 5% to 19% cash Global listed property 0% to 10% ifi Australian fixed interest 13% to 27% International fixed interest afi 13% to 27% Cash 3% to 17% Growth assets 45% to 55% Income assets 45% to 55% international shares aus shares global property unhedged international international shares aus shares Cash 100% Growth assets 0% Income assets 100% Defined Benefit members If you are a Defined Benefit member, your defined benefit (including the compulsory member contributions you make) is invested in the Balanced 50/50 option. Your 3% Productivity account is also invested in the Balanced 50/50 option as it forms part of the defined benefit calculation which is used to ensure that all benefits payable from the Plan meet Superannuation Guarantee obligations. If you have a Surcharge Offset account, this is also invested in the Balanced 50/50 option. Defined Benefit members have investment choice for additional voluntary accounts and rollover accounts (if any). 7

10 feature The Federal Budget and your super In outlining a number of super-related proposals in the Budget, the Government has confirmed that the purpose of superannuation is to provide income in retirement to substitute or supplement the Age Pension. Changes would only start from 1 July 2017 if the Government is re-elected and Parliament passes the necessary legislation. Most of the measures are aimed at reducing tax concessions available to higher income earners, and the Government expects less than 4% of all Australians in super funds may be affected by these measures. Some other measures increase workplace flexibility. Here is a brief summary of what the proposals are and what they mean. Increasing flexibility ~ ~ The Government proposes to make it easier for anyone up to age 75 to make superannuation contributions. Currently there are rules that apply after age 65 that may restrict some older workers from taking advantage of growing their super while working. Reductions to tax concessions ~ ~ A new $1.6 million cap on the total amount individuals can transfer into retirement pension accounts. This will apply to current retirees as well as those still to enter retirement. Existing retirees would have until 1 July 2017 to either withdraw the excess from super or transfer it back to an accumulation account where investment earnings would be taxed at a maximum of 15%. ~ ~ From 1 July 2017, there will be a lower limit of $25,000 per year on the amount of concessional contributions that can be made to super. Concessional contributions include employer contributions and any before-tax contributions. Currently the limit is $30,000 per year if you are under 50 and $35,000 per year if you are over 50. According to the Government, this measure will impact about 3% of Australians in super funds. If you have less than $500,000 in super, the Government proposes that you will be able to carry forward unused caps so that you can make greater contributions later on. Unused amounts will be able to be carried forward on a rolling basis for a period of five consecutive years. This may assist members to balance family responsibilities by topping up their super in later life, when any children aren t as reliant on parental financial support. ~ ~ The total amount of non-concessional contributions you can make to super will be limited to $500,000. Currently the limit is $180,000 per year (or $540,000 over a three year period if you are under 65). This will limit the amount of lump sum contributions you can make to super from, for example, the sale of a property or the receipt of an inheritance, and is intended to prevent super being used for estate planning and tax avoidance. The Government plans to make this change from Budget night (3 May 2016) and will apply to contributions made on or after 1 July ~ ~ Currently, high income earners pay a higher rate of tax on their superannuation contributions of 30% (instead of 15%). From 1 July 2017 this tax will apply to anyone whose adjusted taxable income exceeds $250,000 per year (currently $300,000 per year). The Government says this will affect about 1% of Australians in super funds. ~ ~ The Government proposes tightening the tax treatment of transition to retirement pensions by removing the tax-free status of investment earnings on assets invested in these pensions where the member has not retired from the workforce. The investment earnings will be taxed at a maximum of 15% rather than being tax free. Transition to retirement pensions may feature in the retirement planning of anyone over their preservation age and are a complex product. If this proposal becomes law, members in this position may wish to discuss their options with their financial adviser. 8

11 How super is taxed How are my contributions taxed? When concessional contributions are paid into the Plan, a contributions tax of generally 15% applies. If your relevant income is over $300,000, you will receive an additional tax assessment from the ATO and the tax rate on your concessional contributions will increase to 30%. Note that one of the Budget proposals is to lower the $300,000 amount to $250,000 from 1 July How are my investment earnings taxed in the Plan? Investment earnings are generally taxed at the rate of 15%. The tax paid reduces for deductions and imputation credits available to the Plan. This tax is deducted from the Plan s investment earnings before they are applied to your accounts. How is my super benefit taxed? The tax payable on benefits depends on a number of factors, including: ~ ~ The type of benefit being paid (retirement, disability or death), ~ ~ Who receives the benefit, ~ ~ Whether you were an Australian citizen or permanent resident when the benefit was paid. Higher tax applies to benefits paid to temporary residents who permanently leave Australia, and ~ ~ How you receive the benefit (e.g. lump sum amount or pension) and your age. If you are age 60 or over, generally all lump sum payments and pensions paid to you from a taxed super fund (such as this Plan) will be tax free. Death benefits paid to non-dependants are taxed. This is general information only and is current at the date of this document. Limits on contributions The Government has set limits or caps on the amount that can be contributed to super each year before extra tax applies. These limits apply to the financial year ending 30 June Note that the Budget proposed changes to these limits from 1 July 2017 (see page 8 for more details). What is the annual limit? What tax applies if my contributions are within the cap? How much tax applies to the excess if I exceed the limit? Concessional contributions Under age 49* at the end of the previous financial year: $30, or over* at the end of the previous financial year: $35,000 Generally 15% contributions tax Your marginal tax rate less 15% (reflecting tax already paid by the Plan), plus an interest charge. The Medicare Levy and the 2% Temporary Budget Repair Levy may be added (if applicable). Non-concessional contributions $180,000. Members under age 65 can generally bring forward two years of caps to make total non-concessional contributions of up to $540,000 over three years Nil If you withdraw the excess from super Nil tax on contributions. Associated earnings taxed at your marginal tax rate If you leave the excess in super Up to 47%, plus the 2% Temporary Budget Repair Levy * Your age at 30 June If you exceed the limits, the ATO will forward you a tax assessment. For excess concessional contributions, you can either pay the extra tax directly to the ATO or arrange for it to be debited from your benefit. Members who exceed the concessional contributions cap can elect to release up to 85 per cent of the excess contributions from the superannuation system. If you choose to do so, the amount will be paid by the Plan to the ATO, where it will first be used to meet any outstanding tax liabilities you may have (including the tax on the excess contributions) with the remainder then paid back to you. Excess contributions withdrawn do not count towards your non-concessional cap. If you exceed the non-concessional cap, you can now elect to release the excess contributions from super, together with an amount of associated earnings. The ATO will send you a form to enable you to do this. The associated earnings will be included in your taxable income and taxed at your marginal tax rate. Note that the associated earnings amount is calculated by the ATO using a prescribed interest rate and may not reflect the actual earnings on the contributions in the Plan. If you don t elect to withdraw all the excess contributions, they may be taxed at up to 47%, plus the Temporary Budget Repair Levy. Arrangements for Defined Benefit members If you are a Defined Benefit member, the Company pays contributions to the Plan from time to time to ensure that the Plan s assets are sufficient to provide for your defined benefits. Superannuation law requires that a notional employer contribution be calculated each year for the purpose of attributing a value to contributions funding your defined benefit. This forms part of your concessional contributions and, along with any before-tax contributions you make to your super, is measured against your annual concessional contributions cap. This notional employer contribution is determined by the Plan s actuary using a formula set by the Government. It is not necessarily the actual amount your employer pays to the Plan. If your notional employer contribution is greater than the concessional contributions cap, the law provides that, in certain circumstances, you may be entitled to have your notional employer contribution deemed equal to the cap. Should you have any questions on concessional contributions caps, please contact Marcus Wappet on

12 Fees and other costs Please note that this calculator does not apply to defined benefits. * The Trustee has already negotiated the fees and costs of the Plan on your behalf. There is no scope to negotiate lower fees and costs on an individual basis. 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 plan 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 chosen by you. You should read all the information about fees and other costs because it is important to understand their impact on your investment. The fees and costs for each investment option offered by the Plan are shown below. Type of fee or cost Amount How and when paid Investment fee Growth All members 0.40% to 0.50% p.a. of assets ($4.00 to $5.00 per $1,000) Balanced 50/ % to 0.36% p.a. of assets ($2.80 to $3.60 per $1,000) Cash Nil Investment fees are deducted from your investment returns before they are applied to your accounts on a monthly basis. These fees only apply to benefits that are linked to investment returns. They do not apply to defined benefits. Administration fee $9 per week Employee Members only Deducted from your account balance each week. 0.90% p.a. of assets ($9.00 per $1,000) Retained Members only Account keeping fee, deducted from your account balance on a monthly basis. Buy-sell spread Cash to Balanced 50/50: 0.34% of the amount switched Cash to Growth: 0.42% of the amount switched 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. Your employer may be able to negotiate to pay lower administration 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 fee calculator to help you check out different fee options. Switching fee Nil Not applicable. Exit fee $ (increasing to $ from Charged to your account 1 August 2016) Other fees and costs 1 Indirect cost ratio Nil Not applicable. It is deducted from your account balance at the time you switch investment options (based on the option you transfer into). There is no buy/sell spread for switches between the Growth and Balanced 50/50 options, or switches to the Cash option. 1 Fees for activities such as Family Law matters may apply (see Additional explanation of fees and costs on page 11). 10

13 Additional explanation of fees and costs 1. Investment fees The investment fees shown in the table on page 10 are deducted from the investment returns earned by the Plan s investments before they are applied to your accounts. This means that the returns shown on page 2 of this Annual Report have been reduced by these fees and taxes. Tax is deducted from the Plan s investment earnings at the rate of 15%, less any applicable deductions and imputation credits available to the Plan. None of the Plan s investment managers charge performance-based fees. 2. Administration fees These costs include administration, consulting, audit, legal and other fees incurred by the Plan. The fees shown in the table on the previous page are gross of tax. Any management costs not covered by deductions from your accounts are met by additional Company contributions to the Plan. 3. Buy-sell spread This is a fee charged by the Plan to reflect any costs charged by the investment managers when you change investment options. It is deducted from your account balance when you change investment options (based on the option you transfer into) and is therefore an additional cost to you. 4. Insurance cover for NSP employee members A feature of the Plan is the members insurance cover with AMP, for Death and Total Permanent Disability. Additional contributions are made by Nissan to fund such insurance cover for members. 5. 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. The fees are: Defined Benefit members ~ ~ Establishment of an entitlement to your spouse: $165, ~ ~ Payment of an amount to your spouse: $165. Accumulation (including Retained) members ~ ~ Establishment of a base amount and payment to your spouse: $165. For Defined Benefit members, your benefits are subject to a minimum benefit which is calculated in accordance with the Superannuation Guarantee legislation. The minimum benefit includes an allowance of 0.60% of salary to cover expenses and the cost of providing your death and disablement benefits. (This excludes ex-nest members.) All fees include GST where applicable. 7. Fee changes Some of the fees are dependent on the fees charged by the Plan 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 Plan each year. The Trustee reserves the right to increase the fees without your consent if necessary in order to manage the Plan. You will be given at least 30 days notice of any fee increases. The fees shown are effective from 1 August 2016, unless otherwise stated. Details of the fees that applied to you for the year ending 31 March 2016 are shown on your Benefit Statement. The fees charged may depend on your employment status or category of membership in the Plan. If you change categories, you will be advised of any changes to the fees that apply to you. Further details of the fees and taxes paid by the Plan can be found in the Plan s Financial Statements. A summary is included on the back cover of this Annual Report, or a copy can be obtained from the Plan administrator on In addition, if your super is split under a Family Law agreement or Court Order, fees will apply for the splitting of your super and the payment of an amount to your former spouse. These fees are normally shared evenly between you and your former spouse. The fees may be paid by you and your spouse by cheque, or otherwise will be deducted from the applicable benefits. 11

14 about the plan How your Plan is managed Your Trustee A Trustee company, Towers Watson Superannuation Pty Ltd (ABN , AFSL ) is responsible for managing the Plan. It has been licensed to act as a Trustee by the Australian Prudential Regulation Authority (APRA), the prudential regulator of super funds in Australia. Towers Watson Superannuation Pty Ltd is a subsidiary of Towers Watson Australia Pty Ltd (ABN , AFSL ), who also acts as Administrator (via an outsourced arrangement), actuary and secretary to the Plan. See under Advisers to the Plan below for more information. Your Policy Committee A Policy Committee ensures that the interests of members and the Company are represented in the management of the Plan. The Committee comprises four members, with half appointed by the Company and half elected periodically by members. There were no changes to the Policy Committee during the year. The next Policy Committee election will be held in June At 31 March 2016, members of the Policy Committee were: Company-appointed Marcus Wappet Steve Hogan Indemnity insurance Member-elected David Lloyd Andrew Dimsey The Trustee is currently covered by a Trustee Professional Indemnity insurance policy that protects the Plan s assets from a legal liability to the extent allowed by law and the policy conditions. Advisers to the Plan If you have a problem or concern We try to ensure that the Plan s level of service meets your expectations. Sometimes however, problems may arise. When you first have an enquiry or complaint, you should contact the Plan Administrator (see the inside cover for contact details). Privacy-related enquiries should be directed to the Plan Administrator. The Trustee has a formal process for reviewing enquiries and complaints if you are not satisfied with the response you receive. To make a formal enquiry or complaint, please obtain an Enquiry or Complaint form from the Plan administrator or from nsp.nissan.com.au. The Trustee will respond to you within 90 days. You can request the Trustee s reasons for its decision on your complaint. A copy of the Trustee s Enquiries and Complaints Policy is also available from nsp.nissan.com.au. If you are not happy with the Trustee s handling of your enquiry or complaint, you may then contact the Superannuation Complaints Tribunal. The Tribunal is an independent body set up by the Federal Government to deal with certain enquiries or complaints that the Trustee has not dealt with 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 Plan as a whole. Time limits also apply to certain complaints relating to total and permanent disability claims 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 Plan Administrator or refer to the Tribunal s website on as soon as possible for further information. Complaints about your privacy that have not been resolved to your satisfaction can be directed to the Office of the Australian Information Commissioner (OAIC). You can contact the OAIC on or by to enquiries@oaic.gov.au. The following organisations provide specialist services to the Trustee. Consultant and actuary Administrator Investment consultant Legal adviser External auditors Insurer Towers Watson Australia Pty Ltd Towers Watson Australia Pty Ltd (outsourced to Link Super Pty Limited (ABN ) a Corporate Authorised Representative (No ) of Pacific Custodians Pty Limited (ABN , AFSL )) Towers Watson Australia Pty Ltd Minter Ellison Crowe Horwath, Deloitte AMP Did you know? Half of the Policy Committee members are elected by members of the Plan. 12

15 What happens if you leave If you leave your employer or choose another super fund, the Plan s administrator will ask you how you want to receive your super benefit. For information on the options and actions you need to take when leaving and withdrawing your benefits from the Plan, you should refer to your Exit Package. For a copy of the Exit Package, please contact the Plan administrator on or by to nissansuperadmin@linksuper.com. If your benefit is greater than $10,000, it will be held in the Plan s Retained Benefits Division (RBD) where it will continue to be invested in your chosen investment option, less any fees that apply (refer to the Plan s Retained Benefits Division leaflet for more information). If you are a Defined Benefit member, the defined benefit portion of your benefit will be crystallised in a single account where it will be invested in the Balanced 50/50 option whilst in the RBD. Members are able to change investment options at any time whilst a member of the RBD. The Plan s normal buy-sell spreads apply. The net investment returns, whether positive or negative, will apply to your account until the Plan administrator processes your completed payment/transfer instructions. You may leave your benefit invested in the Plan s RBD for as long as you like. You can transfer it out of the RBD at any time or have it paid to you in cash if you satisfy the Government s preservation requirements. In all instances it should be remembered that the insurance cover you had through the Plan whilst you were employed by Nissan ceases on the day you leave Nissan. It may be possible to continue your cover directly with the Plan s insurer, AMP, at your own expense without the need to provide evidence of good health. Please refer to the Exit Package for details on continuing your cover. Time limits apply, so please don t delay making a decision. The Trustee may roll your benefit over to an Eligible Rollover Plan (ERF) if your benefit is less than $10,000 and: ~ ~ You fail to give the Plan s administrator instructions within 90 days of receiving details of your benefit, or ~ ~ The super fund you nominate won t accept your benefit. The Trustee has nominated: The Administrator AMP Eligible Rollover Fund PO Box 300 Parramatta NSW 2124 Phone: Once your benefit is transferred to the ERF, you stop being a member of the Plan and no longer have any rights under the Plan. 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 will be different to those that applied in the Plan. Also, the ERF does not offer any insurance cover. You should seek advice from a licensed financial adviser about whether the ERF is a suitable investment for you. Establishing proof of identity Before you withdraw a benefit from the Plan, you may need to establish your identity by providing certified copies of certain documents. The Trustee may also need to obtain additional identification information and to verify your identity from time to time. In some cases, the Trustee may have to disclose information about you to the Australian Transaction Reports and Analysis Centre (AUSTRAC), the regulator of this legislation. Due to the sensitive nature of the information, the Trustee is not permitted to inform you if this happens. Need to know more? Other information about your benefits, such as your choices for contributions and investments, are available at nsp.nissan.com.au or by contacting the Plan administrator on A number of Plan documents are also available on the website including the Trust Deed and various Trustee policies. How to find a financial adviser If you would like to discuss your super or retirement plans, consider speaking with a financial adviser. Towers Watson Australia Pty Ltd offers financial planning services through qualified financial planners contact (03) to speak with one. You can find tips on locating a financial adviser in your area by downloading the Government s guide, Financial advice and you, from click on the Publications quick link at the bottom and scroll down to the Investing category. You can also contact the Financial Planning Association of Australia at or by phoning Did you know? There are situations where you need to prove your identity before your super can be paid. 13

16 financial summary Here is a summary of the Plan s unaudited financial accounts for the year to 31 March 2016 The audit is expected to be finalised by the end of June The audited financial accounts and auditor s report will be available on request from the Plan administrator on after that date. Change in net assets during the year $ Net assets at the start of the year 33,702,170 Plus income Contributions 929,103 Rollovers 6,582 Investment income and distributions (1,219,693) Interest 1,971 Other 286 Less outgoings Benefit payments 3,019,734 Insurance premiums 50,000 Tax due (178,119) Expenses and charges 286,147 Net assets at the end of the year 30,242,657 Statement of net assets $ $ Investments Schroder Australian Equity Fund 4,859,349 4,341,200 SSgA Broad Investment Grade Fixed Income Trust 2,410,092 Blackrock Global Bond Index Fund 2,185,310 SSgA Australian Fixed Income Index Trust 7,349,300 6,400,884 Resolution Capital Global Property Securities Fund 1,350,726 1,241,422 Macquarie True Index Cash Fund 2,554,926 2,285,888 Macquarie Australian Pure Index Equities Fund 4,853,404 4,485,453 MFS Fully Hedged Global Equity Trust 4,028,978 3,687,648 Arrowstreet Global Equity Fund 6,149,746 5,154,880 Current assets Cash and equivalents 142,889 15,757 Deferred income tax asset 353, ,720 Other assets/receivables 84, ,937 Current liabilities Benefits payable Taxation payable 381,066 16,150 Other 53,657 76,292 Net assets at the end of the year 33,702,169 30,242,657 Current assets include amounts in the Plan s bank account. All contributions due at 31 March 2016 have now been paid to the Plan.