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First Super Annual Report 2011_12

A
n

I
n
d
u
s
t
r
y
Super
F
un
d
Industry super for workers in the timber, pulp

& paper and furniture & j o i n e ry i ndu s t r ie s
Fir st
Su p e r
I
f you are viewing this report online, you can obtain a free paper copy from us by calling
1300 360 988
.
A nnual
R
e p or t 2011Œ 12

First Super is the industry fund
for workers in the timber, pulp

& paper and furniture & joinery
industries, their families and

their communities:
As an industry fund

F
irst Super:

Has low fees
P
ays no commissions
I
s run only to bene˜t
members
Be super smart

and avoid expensive

mistakes
Your super can be a safe, low-cost
and tax-effective way of saving for

retirement if you make the most

of it. But not all super is the same.
You™re sitting on a larg e nest egg,
so don™t be surprised if the vultures

start to circle.
As your savings grow, you may be

a p p r o a ch e d by financial planners
working with banks or the super
funds owned by the big banks

p r o m i s i n g yo u higher returns.
Unlike First Super, which is run
for the benefit of members, these

funds are run to generate profits

for their shareholders and may

charg e high entry fees or exit fees
which can really eat into your
savings, leaving you worse off

a t retirement.
You should also be wary of anyone
that claims you can withdraw

your super early. Except in special

circumstances such as severe
financial hardship, permanent
incapacity or on compassionate

grounds, it is illegal to withdraw

your super before ag e 55 and doing

so can lead to large tax fines.
How to avoid big mistakes

Ask lots of questions and check

the facts

Compare the real cost of fees
and charges

Understand what the fund is
invested in and the risks and
historical returns

Don™t be pressured or rushed
into making a change

Get professional advice. If you
aren™t comfortable or don™t

understand, don™t go ahead.
G
et advice from the
professionals
First Super members can access
independent financial advice from

a licensed financial planner. There
is no cost for your first meeting.
Additional advice will be provided

on a fee-for-service basis. A

special $250 flat fee basic financial

planning service is available

to members aged 45+ or to any

members facing redundancy.
C
all
1300 360 988

to speak to our
F
inancial
P
lanner.*
*Financial planning is supplied by
Industry Fund Financial Planning (IFFP).

IFFP is a division of Industry Fund

Services Pty Ltd Œ ABN 54007 016 195, AFSL

232514. Complex plans may incur a higher

fee. Offer current at October 2012 but

may be varied or withdrawn at any time.
You may reg ister to receive a printed copy of theAnnual Report by mail each year by calling
1300 360 988.
First Super
is
your
industry fund
2

Co-Chairs™ message
While First Super was a top five
performer in 2011-12*, difficult

economic conditions in Europe and
the USA were reflected in quite low
investment returns.
The Board™s decision to maintain a
defensive investment strategy worked

as planned. The 2.5% return for

Balanced option members (majority

of the Fund) contrasted with negative
returns for many other super funds.
Since the global financial crisis First
Super™s Balanced option returned

an averag e 6.7% p.a., well ahead of
some of the funds run by big banks

(see table).
The lower risk Conservative Balanced
option returned 4.4%. The Cash option
returned 5.4%, an outstanding result.
The higher risk Shares Plus option
recorded -1.3% for 2011-12, but

returned +7.0% p.a. over the last

3 years. A new Growth option was

recently added.
Commentators have questioned the
value of superannuation when major
funds have deliveredﬁless than bank
interestﬂ over recent years.
But spreading your super across
shares, property, infrastructure, bonds

and cash is expected to deliver better

returns than bank interest over the

longer term.
Investing through superannuation
also has tax advantag es. The averag e

tax rate on First Super™s earnings for

2011-12 was 9.33%. Savings account

interest is taxed at marginal rates,
which for many working people is
32.5%, 37%, or higher.
Y
our super options
Members do have investment choices.

It™s your super and you can decide

how you want it invested.
We encourage members to speak with
a First Super Financial Planner about

your superannuation and insurance

options. Our planners regularly visit
workplaces and regional centres,
or are available by phone. Your first
consultation is free. The Board has

also continued the special $250 flat

fee basic financial planning service to

members ag ed 45+ or any members
facing redundancy.
P
rotect your super
There are plenty of accountants, or
financial planners who represent the

big banks and the retail super funds
they own, who will tell you that you
would be better off investing with

their guidance. Members should ask

themselves: whose interests will they

really put first Œ yours or theirs?
As Co-Chairs, we can confidently
reassure you that the Trustee Board

acts totally in your interests and

remind members;

First Super does not take or pay
commissions.

First Super does not charge high
fees to pay hug e executive salaries
or dividends to shareholders.
Some of our members who have been

enticed into higher cost funds have
quickly switched back to First Super

when they™ve learned what the real

costs are compared to our low fees.
Even if you leave your job or our
industry, you can stay with First
Super. So be aware and seek advice
should you consider chang ing

superannuation funds. Once again we

remind members that g eneral advice

provided by First Super is free.
P
rotect your family
A high priority of your Board is to

ensure that members have adequate

insurance to protect themselves
and their families should the worst
happen. First Super™s new group

insurance contract has many new

features.
Members can now fix their amount
of death and total & permanent

disability (TPD) cover, apply for
additional cover or to transfer any
other death & TPD cover to

First Super.
The new insurance benefits are

explained later in the Annual Report.
Again, you are encourag ed to discuss
your insurance needs with a First
Super financial planner. It is a simple
as picking up the phone and making

a call.
More changes to super
Recent and proposed Federal

Government changes to

superannuation are explained in this
Annual Report.
They include a new super
contribution tax payment of up to
$500 annually for low income earners

(taxable income below $37,000)

which in effect means that for those

members concessional contributions
to their super fund will be tax-free.
First Super will keep you informed of
any chang es that affect you.
Supporting our industries
First Super continues to sponsor and

support industry events and awards

and invest in the timber, pulp & paper
and furniture industries.
We™d like to thank you, our members
and employers, for your continued

support of your industry fund.
Your Board remains committed to
you its members and will continue to

work hard to improve services while

carefully investing your retirement
savings in what is still a challeng ing
environment.
Michael O™Connor
Construction Forestry

Mining & Energy Union,

Forestry & Furnishing

Products Division
Allan Stewart
Timber Trade

Industrial Association
3
Annual Report
2011-2012

2012
R
eturns
Investment Option
1 year

% p.a.
2 years

% p.a.
3 years

% p.a.
5 years

% p.a.
10 years

% p.a.
Return
since
inception
Date of
Inception
Balanced (default)
2.5%
4.6%
6.7%
-0.6%
5.4%
8.0%
1/07/1988*
Shares Plus
-1.3%
3.7%
7.0%
-3.7%
4.4%
2.8%
1/03/2001
Growth
N/A
N/A
N/A
N/A
N/A
5.1%
14/10/2011
Conservative Balanced
4.4%
5.9%
7.3%
N/A
N/A
2.8%
1/07/2008
Cash
5.4%
4.9%
4.4%
4.2%
4.6%
5.0%
1/03/2001
*The composition of the

Balanced option was fundamentally different prior to 1 July 1988.
Investment Option
1 year

% p.a.
2 years

% p.a.
3 years

% p.a.
5 years

% p.a.
Return since
inception
Date of
Inception
Balanced (default)
3.1%
5.3%
7.7%
-0.1%
5.1%
18/03/2005
Shares Plus
-1.1%
4.2%
7.7%
-3.3%
3.7%
1/07/2005
Conservative Balanced
5.2%
6.7%
8.3%
N/A
3.3%
1/07/2008
Cash
6.3%
5.8%
5.2%
4.9%
4.8%
1/07/2005
Note:

of future performance.
Super Members
2012 and long-term crediting rates for each investment option (% p.a.)
P
ension Members
2012 and long-term crediting rates for each investment option (% p.a.)
Positive returns

in a dif˜cult environment
First Super™s defensive investment
strategy worked as planned in

2011-12, delivering modest but
positive returns for the Balanced
(default) option in a difficult

investment environment. The

default option of many other super

funds recorded negative results.
The First Super Board has

confirmed continuation of the

defensive strategy for the Balanced
option, in which 95% of members
are invested. When sharemarkets

are rising First Super™s Balanced

option may not perform as strongly

as other funds; but when times
are tough the risk of incurring
losses is lower than that for a lot of

other default investment options.
The Conservative
Balanced option delivered
good returns in 2011-12,
while the Cash option
was an outstanding
performer.
4

First Super has
negotiated improved
insurance arrangements
for members, appointing
MetLife Insurance
Limited, part of the

international MetLife
group of companies,

as our new insurer.
Beginning 1 July 2012, improved
terms, conditions and insurance

options will help ensure you
and your family are protected
should the unexpected occur

and you suffer death, total and

permanent disability or loss of

income due to sickness or injury.
New insurance arrangements a big win for members
How you can benefit
D
EATH AN
D
T
PD

C
OVE
R
You can now:

apply to fix the amount of

your cover so it doesn™t decline

over time

apply for a fixed amount of
Death & TPD cover

apply to transfer any other
Death & TPD cover you have

to First Super

maintain Death & TPD cover
until your 70th birthday.*
* Special TPD definition applies from ag e 65.
I
N
C
OME
PR
OTE
C
T
I
ON
C
OVE
R

Premiums reduced by

around 10%

Apply to transfer any other
Income Protection cover you
have to First Super
A
U
TOMAT
IC

C
OVE
R
4 units of Death and TPD
insurance will be automatically

provided to all members from

1 October 2012 unless you

tell us that you do not want this

insurance cover.
M
EMBE
R
S

A
G
E
D 65-70 Y
EA
RS
From 1 October 2012, TPD cover

will be available until ag e 70.

Under the previous policy, it
would have lapsed at ag e 65.
Conditions apply.
APP
L
Y F
O
R
A
DDI
T
I
ONAL

C
OVE
R
ONL
I
NE
In most cases, you™ll receive an

immediate decision.
Please note: You can cancel

or reduce your default cover at
any time by calling

1300 360 988
or emailing us on
mail@firstsuper.com.au
L
I
KE TO KNOW MO
R
E?
Further information is contained

in the Product Disclosure

Statement (PDS) and Insurance

guide, available for download
at
www.firstsuper.com.au
or
contact us on
1300 360 98
8 or via
email at
mail@firstsuper.com.au

and we™ll send you a copy.
.
5
Annual Report
2011-2012

Fund
Investment Options
Returns to 30 June 2012 (% p.a)
Estimated
Fees per
year*
1 year %
3 year %
5 year %
First Super
Super Fund Balanced
2.5
6.7
-0.6
$412
AMP
Custom Super Balanced Growth
-1.3
4.6
-2.9
$1,090 – $1,315
BT Lifetime Super
Balanced Retur ns
-0.2
5.2
-1.5
$920
Colonial First State
Rollover and Superannuation Diversified
-1.9
4.6
-2.6
$935 – $1,135
MLC
Masterkey Super Balanced (MLC Horizon 4)
0.6
6.4
-1.2
$1,028 – $1,278
OnePath
Integra Super Optimix Balanced
-3.0
4.4
-2.5
$990
*Estimated fees are based on as account balance of $50,000 with total contributions of $5,000 during the year and are sourced from product disclosure statement for each fund.
Disclaimer
Information contained herein has been obtained from a range of third party sources. While the information is believed to be reliable, Mercer has not sought to verify it
independently. As such, Mercer makes no representations or warranties as to the accuracy of the information presented and takes no responsibility or liability (including

for indirect, consequential or incidental damages), for any error, omission or inaccuracy in the data supplied by any third party. The information provided is not intended

to convey any guarantees as to the future performance of the investment products discussed. Past performance does not guarantee future results and the information
provided does not constituent individualised investment advice.
The information in this document is intended as general information only. The information does not take into account any individual persons circumstances, financial
objectives or needs. You should not consider acting on the information provided in this document. The above tables do not contain all the information needed to evaluate
the funds and you should also obtain the product disclosure statement from the relevant provider and seek professional advice as appropriate. You should consider your
own circumstances, financial objectives, financial situation and needs.
This does not constitute an offer or a solicitation of an offer to invest or disinvest from of any of the funds shown above.
You™re with a top

performing super fund
Even during the recent
difficult investment
environment, First Super
remains one of Australia™s
top performing super funds.
Around 95% of First Super
members have their super invested
in the Balanced Option (the default
option), so chances are you™re one
of them. This option has returned

2.5% for the 12-months to 30 June
2012, 6.7% p.a. (2009-2012) since

the global financial crisis, 5.4% p.a.
over the past 10 years and 8.0% p.a.
since it was established in 1988.
Returns vary considerably from
year to year, so you should look
at performance over as long a

period as possible. You should

also compare your investment
with investments of the same
type in the overall market, taking

into account that your super fund

returns are
after
tax has been paid.
C
ompare the results
Mercer Consulting (Australia)

Pty. Ltd., an independent

actuarial company, compared the

investment performance

of a selection of different super

funds selected by First Super.

The following table compares
the performance of First Super™s
Balanced investment option

at 30 June 2012:
Strong results for
pension members
Your money doesn™t stop working
when you do which is why

First Super offers a Transition
to Retirement Pension Account
(Transition Account) and Pension

Account for members who

are approaching retirement or

have retired.
Why choose a

F
irst Super
P
ension?

It provides a regular income
stream

You choose how much money
you get and how often

You choose how your money is
invested

Low fees and no commissions

It™s tax-effective
The First Super Pension is also
a strong performer, with the

Balanced option returning 3.1%
for the 12-months to 30 June

2012 and 7.7% p.a. over the past

3 years. For more information,
call
1300 360 988
or download

the Pension Guide (PDS) at

www.firstsuper.com.au
6

Shares
P
lus
1

Shares
P
lus
2

G
rowth
3

Balanced

(default option)
4
C
onservative
Balanced
5
C
ash
You can split your super to make
up your own mix in any percentage

split across the five investment
options that totals 100%. This
flexibility enables you to tailor how

your super is invested, to more
closely fit your individual needs

and attitude to risk
For example, you could choose to

split your investment:

50% in Balanced and 50% in
Shares Plus; or

25% in Cash and 75% in
Conservative Balanced.
Making an
investment choice
Before you make a choice, read
about the risks and returns

for each investment option
and consider your personal
circumstances.
If you are close to retirement age,
you might prefer a low-risk, low-
return option. If you have much

of your working life ahead of you,
choosing an option with a greater
level of risk may increase the

chances of growth over the

longer term.
Call
1300 360 988
and speak with
a First Super Financial Planner for

advice on the investment choice
option that may be best suited to
your situation and attitude to risk.
The investment options available
to First Super members are

summarised below.
First Super accumulation and pension fund members can choose how their super
is invested. You can choose to invest in one or a combination of the following five
investment options, provided you have an account balance of at least $1,000:
INVESTO
R PR
O
FI
LE

This investment option is
likely to appeal to members

with a long-term view of their
superannuation savings and/
or who are prepared to accept

higher risk in the search for

higher returns.
O
B
J
E
C
T
I
VES

Achieve an investment return
(after tax and investment

expenses) that exceeds
inflation, as measured by the
Consumer Price Index, by at

least 4.0% per annum over

rolling seven year periods;

To confine the chance of the
rate credited to members

falling below zero in any
financial year to less than one in

five; and

Achieve an investment return
(after tax and investment

expenses) that exceeds the

median of the SuperRatings High

Growth (91-100) Option Survey
over rolling five year periods.
RI
SK
PR
O
FI
LE
The Shares Plus option is likely to
provide a high degree of volatility

and fluctuations in returns and is
at the high end of the risk/return
rang e. The risk may increase by the

nature of overseas investments,

which means that this option is

subject to the considerable extra
risk of currency fluctuations and
international events. It is likely to
outperform the other investment
options offered in the long er term.
Standard risk:
4.0 years
R
isk band:
6

R
isk Label:
high
A
SSET

ALLO
C
AT
I
ON

AN
D R
AN
G
ES
Asset Class
Target %
Range %
Australian Equities
42.0
32 Œ 52
International Equities
32.0
22 Œ 42
Australian Private Equity
5.0
0 Œ 10
International Private Equity
1.0
0 Œ 5
Australian Infrastructure
5.0
0 Œ 10
International Infrastructure
5.0
0 Œ 10
Property
10.0
0 Œ 20

It™s your super

to invest as you want
7
Annual Report
2011-2012

G
rowth
INVESTO
R PR
O
FI
LE

This option is likely to appeal to
members who are prepared to

accept higher investment risk in
the search for higher returns,

but also wish to reduce the

risk of very large investment

losses by diversifying into some

defensive assets.
O
B
J
E
C
T
I
VES

Achieve an investment return
(after tax and investment

expenses) that exceeds inflation,
as measured by the Consumer
Price Index, by at least 3.75% per

annum over rolling five year

periods;

To confine the chance of the rate
credited to members falling
below zero in any financial year

to less than one in seven; and

Achieve an investment return
(after tax and investment

expenses) that exceeds the

median of the SuperRatings

Default Option Survey over

rolling five year periods.
R
I
SK
PR
O
FI
LE
The Growth option is likely to

provide a high degree of volatility

and fluctuations in returns. It has
a lower investment risk/return
profile than the Shares Plus option

because it has a higher exposure

to defensive assets. Over the long

term it is likely to outperform the
other investment options except
for Shares Plus.
Standard risk:
3.3 years
R
isk band:
5

R
isk Label:
Medium to

high
A
SSET

ALLO
C
AT
I
ON

AN
D R
AN
G
ES
Asset Class
Target %
Range %
Australian Equities
33.0
23 Œ 43
International Equities
26.0
16 Œ 36
Australian Private Equity
5.0
0 Œ 10
International Private Equity
1.0
0 Œ 5
Australian Infrastructure
5.0
0 Œ 10
International Infrastructure
5.0
0 Œ 10
Property
10.0
5 Œ 15
Fixed Interest
13.0
5 Œ 15
Cash
2.0
0 Œ 5

INVESTO
R PR
O
FI
LE

This investment option is likely
to appeal to members seeking

mid to long-term growth of

their superannuation along

with diversification across

asset classes.
O
B
J
E
C
T
I
VES

To achieve an investment
return (after tax and

investment expenses) that
exceeds inflation as measured
by the Consumer Price Index,

by at least 3.5% per annum over

rolling five year periods;

To confine the chance of the
rate credited to members falling
below zero in any financial year

to less than one in ten.
R
I
SK
PR
O
FI
LE
Designed to provide good growth

over the mid to long er term

while reducing risk through
diversification. Likely to slightly
under-perform against the First

Super Shares Plus and Growth

options over the long term.
Standard risk:
2.2 years

R
isk band:
4

R
isk Label:
Medium
A
SSET

ALLO
C
AT
I
ON

AN
D R
AN
G
ES
Asset Class
Target %
Range %
Australian Equities
24.0
14 Œ 34
International Equities
18.0
8 Œ 28
Australian Private Equity
5.0
0 Œ 10
International Private Equity
1.0
0 Œ 5
Timber, Furniture and Pulp
& Paper investments
2.0
0 Œ 5
Australian Infrastructure
5.0
0 Œ 10
International Infrastructure
5.0
0 Œ 10
Property
10.0
0 Œ 20
Fixed Interest
28.0
16 Œ 36
Cash
2.0
0 Œ 10

Balanced (default option)
8

C
onservative balanced
Full details of the investment options available are contained in the Product Disclosure Statement (PDS),
available for download at
www.firstsuper.com.au
or contact us on
1300 360 988
or via email at

mail@firstsuper.com.au
and we™ll send you a copy
INVESTO
R PR
O
FI
LE

Members investing for the short to

medium term who want a more

secure option with less chance of
fluctuations than the Shares Plus,
Growth or Balanced options and/

or members looking for lower risk

options for their superannuation

savings.
O
B
J
E
C
T
I
VES

Achieve an investment return
(after tax and investment

expenses) that exceeds
inflation, as measured by
increases in the Consumer

Price Index, by at least 3.0%

per annum over rolling

five year periods;

To confine the chance of the
rate credited to members falling

below zero in any financial year

to less than one in fifteen; and

Achieve an investment return
(after tax and investment

expenses) that exceeds the
median of the SuperRatings
Conservative Balanced (41 – 59)

Option Survey over rolling five

year periods.
R
I
SK
PR
O
FI
LE
Designed to provide more stable

returns than the Shares Plus,

Growth or Balanced options. It

is at the lower end of the risk/
return range and is likely to
underperform against the Shares

Plus, Growth or Balanced options

over the medium to long term.
Standard risk:
1.1 years
R
isk band:
3

R
isk Label:
Low to

Medium
A
SSET

ALLO
C
AT
I
ON

AN
D R
AN
G
ES
Asset Class
Target %
Range %
Australian Equities
17.0
10 Œ 24
International Equities
13.0
6 Œ 20
Australian Infrastructure
5.0
0 Œ 10
International Infrastructure
5.0
0 Œ 10
Property
10.0
0 Œ 20
Fixed Interest
30.0
25 Œ 45
Cash
20.0
2 Œ 25

INVESTO
R PR
O
FI
LE

Members investing for the short
term and/or those who want a

secure option with a low chance
of investment fluctuations. May
be suitable for members intending

to realise or reorganise their

investments in the near future

who want to avoid the possibility
of a loss over that period.
O
B
J
E
C
T
I
VES

Achieve an investment return
(after tax and investment
expenses) that exceeds inflation,
as measured by increases in the
Consumer Price Index, by at

least 1.0% per annum over

rolling five year periods;

To confine the chance of the
rate credited to members falling
below zero in any financial year
being neglig ible; and

Achieve an investment return
(after tax and investment

expenses) that exceeds the

median of the SuperRatings

Cash Option Survey over rolling

five year periods.
R
I
SK
PR
O
FI
LE
Designed to provide very stable

returns at the lowest end of the

risk/return rang e. However, it is
likely to under-perform all other
investment options offered over

all but the shortest periods.
Standard risk:
0.0 years
R
isk band:
1

R
isk Label:
Very low
A
SSET

ALLO
C
AT
I
ON

AN
D R
AN
G
ES
Asset Class
Target %
Cash
100.0

C
ash
9
Annual Report
2011-2012

Investments held by the Fund
The following list shows the investment funds employed by First Super and the direct investments made as at
30
June 2012:
June 2012 $
Australian Equities
Listed Equities
BT Australian Equities
97,493,139
27,181,772
IFM Enhanced Indexed Australian Equities
96,840,560
Invesco Small Cap Australian Equity
28,796,661
Perpetual Australian Equity
96,474,853
Orbis SM Australian Equity Fund
50,768,808
Total Listed Equities
397,555,793
Australian Private Equity
Frontier Advisers Pty Ltd
309,355
Quay Australia First Trust Portfolio
12,221,300
Industry Super Holdings Pty Ltd and Members
Equity Bank Pty Ltd
24,852,964
Macquarie Alternative Investment Trust 3
14,326,820
Macquarie Alternative Investment Trust 4
25,084,853
ING Private Capital Fund 1
170,000
Macquarie Alternative Investment Trust
209,018
Quay Australian 3 Fund
6,637,518
Quay Australian 4 Fund
2,189,499
1,565,237
Total Australian Private Equity
87,566,564
International Equities
Internation Equities (Unhedged)
BlackRock Unhedged World ex Australia
Equities Index
52,988,652
Capital Inter national Global Equity Unhedged
84,979,584
Deutsche Investments Australia Ltd
45,444,934
Inter national Equity Transition
5
Orbis Global Equity Fund
70,714,201
Total International Equities (Unhedged)
255,773,415
International Equities (Hedged)
Blackrock Global Equity Hedged
1,646,040
Total International Equities (Hedged)
1,646,040

June 2012 $
International Private Equity
IFM Global Unit Trust
3,861,552
Wilshire AU PR Market PST G
5,466,790
Wilshire AU PR Market PST H
856,752
Wilshire AU PR Market PST J
3,039,884
Wilshire AU PR Market PST K
1,400,205
Total International Private Equity
14,625,183
Other
Forestry Investment
350,064
Total Other
350,064
Australian Infrastructure
IFM Fund
66,209,718
Hastings UTA
9,918,411
Total Australian Infrastructure
76,128,129
International Infrastructure
AMP Strategic Infrastructure Trust EUR
8,554,787
IFM International Infrastructure
35,456,621
Total International Infrastructure
44,011,408
Property
AMP Property Income Fund
7,871,331
AMP Direct Property
36,364,625
ISPT Development Opp Fund 3
4,547,196
Industry Super Property Trust No 1
91,813,796
Fortius Active Property 1
5,836,216
Franklin Inter national Real Estate 2
2,191,304
QIC Property Fund
58,186,467
Total Property
207,810,935
Fixed Interest
IFM Alternative Fixed Income Fund
27,351,283
BlackRock Indexed Australian Bond Fund
97,512,269
BlackRock Overseas Bond Index
41,004,044
PIMCO DFI Unit Trust
173,108,626
Super Loans Trust (Members Equity Bank)
15,477,681
IFM Credit Opportunities
66,704,220
Westbour ne Yield Fund No.1
46,449,216
Total Fixed Interest
467,607,339
Cash
CFS – Wholesale Premium Cash Fund
9,972,978
Short Term Cash Account
106,083,996
Total Cash
116,056,974
Total Investments
1,667,485,804
10

Investment Performance
and your account
Investment earnings (positive or
negative) are calculated monthly

for each investment option. After

the end of the financial year

(30 June), your account i s a d j u s t e d ,

based on the accumulated

monthly performance of each
investment option after deducting
tax and fees.
If you are paid a benefit during the
year, an interim rate of earnings
(positive or negative) will be

applied to your entire account

balance at the time you take your

payment (this does not apply to
regular pension payments). Interim
rates are based on the declared

monthly returns to the date of

exit or chang e, plus the estimated
investment returns for any

part-month up to that date.
The long-term crediting rates
of the Fund are shown in the

following tables.
The Fund offered four investment options from 1 July 2008. Other than the

Conservative Growth option, which was completely new, each of these was

a continuation of a pre-existing investment option within the old Timber
Industry Superannuation Scheme (TISS). Figures are shown as percentag e
return per annum. Accumulation investment performance history is shown

as performance per annum.
Investment
Option
1 year

% p.a.
2 years

% p.a.
3 years

% p.a.
5 years

% p.a.
10 years

Balanced option was fundamentally different prior to 1 July 1988.
Investment Option
1 year

% p.a.
2 years

% p.a.
3 years

% p.a.
5 years

% p.a.
Return
since
inception
Date of
Inception
Balanced (default)
3.1%
5.3%
7.7%
-0.1%
5.1%
18/03/2005
Shares Plus
-1.1%
4.2%
7.7%
-3.3%
3.7%
1/07/2005
Conservative Balanced
5.2%
6.7%
8.3%
N/A
3.3%
1/07/2008
Cash
6.3%
5.8%
5.2%
4.9%
4.8%
1/07/2005
Note:

5 and 10 year rates are based on the crediting rates for similar investment options in the former Timber
Industry Super Scheme up to 30 June 2008 and First Super since. ‚N/A™ indicates there were no
similar investment options available 5 or 10 years ago. Rates are not guaranteed and may not be the
same as those allocated to your account for reasons including the date you joined and the timing of
contributions. Past performance is not a reliable indicator of future performance.
Super Members
2012 and long-term crediting rates for each investment option (% p.a.)
P
ension Members
2012 and long-term crediting rates for each investment option (% p.a.)
11
Annual Report
2011-2012

The Trustee
The Trustee of First Super is First Super Pty Ltd (ABN
42 053 498 472 AFSL 223988, RSEL L0003049), which is

responsible for ensuring that the Fund is managed in
accordance with the Trust Deed and the relevant law.
First Super is a regulated fund, required to be audited

and to lodg e an annual return withAPRA each year.
The Trustee holds professional indemnity insurance.
At the date this report was issued, the Trustee
had not incurred any penalties under s 38A of the

Superannuation Industry Supervision Act 1993
.
The Board of
D
irectors
At 30 June 2012, the Directors of First Super were:
Member
R
epresentatives
Michael O™Connor (Co-Chair)

David Kirner

Alex Millar

Kevin Millie

Frank Vari
Employer
R
epresentatives
Allan Stewart (Co-Chair)

Peter Bennett (resigned 26 June 2012)

Martin Lewis

Lindsay Morling

Mike Radda
I
ndependent
D
irector
Bob Smith
The Co-Chair persons are elected annually by the
board. Biographies and details by Directors’ other
directorships and significant positions will be

available from November 2012. Copies are available

on request by calling
1300 360 988
.
The Trustee Board is currently made up of five
Directors nominated by the CFMEU (Forestry and

Furnishing Products Division), five nominated by
employer associations and employers and one
Independent Director. Directors are appointed by

the Board after considering the qualifications and

suitability of nominees.
C
ommittees
The Trustee has established subcommittees to deal with

issues and make recommendations to the full Board.
The Board and Committee Charters will be available
on the First Super website from November 2012. Copies

are available on request by calling 1300 360 988. The
Board meets five times a year. Subcommittees g enerally
meet four times a year. Additional meetings may be

scheduled if required.
The Board undertakes an annual review of its

performance and the performance of subcommittees.
Every second year, an independent external review of
the performance of the Board and its Committees is

commissioned.
The Nominations Committee is responsible for
succession planning, and reports to the Board on

such matters.
Service providers
First Super appoints professional advisers and service

providers to assist in the day-to-day running of the

Fund. These are appointed following a process of
due diligence.At 30 June 2012, First Super used the
following advisers and service providers:
Administration:

Super Benefits Administration

Pty Ltd
Member of

CFMEU Forestry & Furnishing
Employer
Servicing:

Products Division
External Auditor:

KPMG
I
nternal Auditor:

Ernst & Young
I
nsurer:

OnePath Ltd (Chang ed to
MetLife Insurance LTD

on 01 July 2012)
I
nvestment Adviser:

Frontier Investment Consulting

Pty Ltd
Master
C
ustodian:

National Australia Bank Ltd
Tax Adviser:

Ernst & Young
Actuary:

Mercer Consulting (Australia) Pty. Ltd
Advisers and service providers may change from time
to time.
R
eserves
A reserve has been maintained for administration

and operational purposes only, such as paying costs

and receiving investment income.
The value of the reserve at 30 June each year for the
past 5 years is shown below:
Date
Reserve
30 June 2012
$10,967,020
30 June 2011
$15,127,326
30 June 2010
$15,827,246
30 June 2009
$6,748,812
30 June 2008
$3,079,552
The reserve is invested in the Balanced investment
option. In addition, the Fund holds liquid assets of

not less than $250,000, as a condition of its Licence
issued by APRA.
Operations of the fund
12

The Directors of First Super Pty Ltd are paid for
the work they do as Directors, though in some

cases payment is made to a Director™s employer
to compensate it for time spent by the Director
manag ing the business of the Trustee and Fund.
The level of fees paid is examined by the
Remuneration Committee, which may seek

independent advice from time to time. Based on

information available, the Remuneration Committee

is satisfied that the level of remuneration paid to
Directors is reasonable.
Fees paid to Directors are paid in respect of:

Board Meeting
P
ayments.
This covers preparation
for and attendance at Board meetings. These
payments include an allowance for travel and

accommodation for those Directors required to

travel interstate to attend meetings Œ i.e. Directors

who have to travel interstate to attend a meeting
are required to pay for their travel, accommodation
and meal costs from the director™s fees that they

re c e ive.

Subcommittee Meeting
P
ayments.
This covers
preparation for and attendance at subcommittee

meetings. These payments include an allowance

for travel and accommodation for those Directors
required to travel interstate to attend meetings Œ
i.e. Directors who have to travel interstate to

attend a meeting are required to pay for their

travel, accommodation and meal costs from the

director™s fees that they receive.

Workshop & Training
C
ourse
P
ayments.
This
covers Directors™ participation in approved
workshops and training courses. An additional
payment is made to cover relevant expenses.

C
onference
P
ayments.
This covers Directors™
participation in approved conferences. These

payments include an allowance for travel and
accommodation for those Directors required to
travel interstate to attend conferences.

Extra
D
uties
P
ayment.
From time to time, the
Board may ask individual Directors to devote extra

time or to undertake extra duties. Directors who

undertake these tasks at the Board™s direction may

be paid a fee for doing so.
Training and professional
development
Directors are required to undertake an induction
process leading up to and following their

appointment. Directors are also required to maintain
their skills and competencies by participating in
industry programs, seminars, conferences, relevant

presentations at Board and committee meetings

and other training and professional development

activities. Directors and officers are required to
undertake a minimum of eight hours of professional
development each year to maintain their skills and

competencies, but are expected to complete not less

than 15 hours.
R
eimbursement of expenses
Directors may also be reimbursed for expenses

associated with undertaking their duties and

attending to the business of the Trustee and Fund.
As noted above, however, Directors must fund their
travel and accommodation relating to attendance

at Board and committee meetings and conferences

from the fees paid to them for these events.
Directors™ and Of˜cers™
Remuneration Report
13
Annual Report
2011-2012

Director & CEO RemunerationTable for the year ended 30 June 2012
Role
Fees (inc Travel and Accomodation costs)
C
o-
C
hairs:
Œ Board Meetings Œ Intrastate

Œ Board Meetings Œ Interstate

Œ Committee Meetings Œ Intrastate

Œ Committee Meetings Œ Interstate

Œ Ad-hoc or Sub Committee Œ Interstate

Œ AIST Chairs Forum Œ Interstate

Other Trustee
D
irectors:
Œ Board Meetings Œ Intrastate

Œ Board Meetings Œ Interstate

Œ Committee Meetings Œ Intrastate

Œ Committee Meetings Œ Interstate

Œ Ad-hoc or Sub Committee Œ Intrastate

Œ Ad-hoc or Sub Committee Œ Interstate

$5,250/meeting

$6,350/meeting

$2,250/meeting

$3,350/meeting

$2,250/meeting

$3,350/meeting

$2,250/meeting

$3,350/meeting

$3,000/meeting

$4,100/meeting

$1,500/meeting

$2,600/meeting

$1,500/meeting

$2,600/meeting
Workshops/Training
C
ourses (
C
o-
C
hairs &Trustees):
Œ Intrast
ate

Œ Interstate

Œ plus for expenses
$1,350/day

$1,350/day

$1,100/meeting
C
onferences (Australia)

$1,100/day
I
nternational
C
onferences & Workshops
$1,350 per day plus reimbursement of travel, accommodation

and incidental costs as deemed appropriate
C
ompany Secretary /
C
EO total salary package
$279,500
It is intended that this table will be published on the First Super website and updated to reflect any changes that are approved by the Board.
Directors™ meetings attendance record for the year ended 30 June 2012
Director
Board meetings
Attendance
Committee meetings
Attendance
Professional development hours
Michael O™Connor
5
5
12
12
65.75
Allan Stewart
5
5
12
12
47.50
Peter Bennett
5
3
4
2
78.75
David Kir ner
5
5
8
8
20.75
Martin Lewis
5
5
12
8
41.25
Alex Millar
5
3
4
2
32.50
Kevin Millie
5
4
4
4
28.00
Lindsay Morling
5
5
8
6
20.25
Mike Radda
5
3
4
4
29.50
Bob Smith
5
5
4
4
32.25
Frank Vari
5
5
4
4
56.75

Peter Bennett resigned on 26 June 2012.
Martin Lewis transferred from the Audit & Compliance and Administration Committees to the Investment Committee in May 2012
Directors™ fees paid for the year ended 30 June 2012 (including GST
where applicable):
Director
Amount $
Payment made to:
Michael O™Connor
80,850.00
CFMEU-FFPD
Allan Stewart
108,900.00
Allan Stewart & Associates Pty Ltd
Peter Bennett
15,883.00
Peter Bennett
David Kir ner
54,285.00
CFMEU-FFPD
Martin Lewis
51,752.63
Martin Lewis
Alex Millar
20,900.00
CFMEU-FFPD
Kevin Millie
37,015.00
CFMEU-FFPD
Lindsay Morling
48,300.00
Lindsay Morling
Mike Radda
23,760.00
UCI Projects Pty Ltd
Bob Smith
56,870.00
Bob Smith
Frank Vari
43,890.00
CFMEU-FFPD
542,405.63
D
irectors™ and
C
EO
R
emuneration Table for the year ended 30
J
une 2012
Note: The g eneral rates of Directors™ fees have not been increased since they were first established effective 1 July 2008).
Hospitality and
G
ifts
Directors and senior management
of First Super may from time to time

accept hospitality and gifts within the
confines of a strict Hospitality & Gifts
Policy. Hospitality & Gifts that are

accepted are recorded in a Hospitality

& Gifts Register which is provided

to the Board™sAudit & Compliance
Committee at each meeting.
It is intended to publish information
about Hospitality & Gifts received

by directors or manag ement on the
Fund™s website.
14

Abridged
F
inancial Statements for
the 2011Œ12 ˜nancial year
The audit of the financial statements is complete, and a clear audit opinion has been received. Copies of the audited
financial statements, Actuarial Report, Trust Deed or any other prescribed documentation are available upon request.
Statement of Financial Position
as at 30 June 2012
30 June 2012 ($)
30 June 2011 ($)
Assets
Investments
1,671,178,419
1,634,203,628
Other assets
22,114,222
17,938,555
Total assets
1,693,292,641
1,652,142,183
Liabilities

Trade and other payables
(5,025,810)
(4,441,550)
(308,347)
(612,975)
Current tax liabilities
(9,500,095)
(7,751,755)
Total liabilities
(14,834,252)
(12,806,280)
Net assets
1,678,458,389
1,639,335,903

Members™ funds
1,667,241,369
1,623,958,577
Reserves
11,217,020
15,377,326
Liability for accrued bene˜ts
1,678,458,389
1,639,335,903
Operating Statement
For the period ended 30 June 2012
30 June 2012 ($)
30 June 2011 ($)
Revenue from investments
42,414,700
106,093,935
Revenue from contributions
160,164,924
182,917,454
Other revenue
11,935,300
13,441,779
Total revenue
214,514,924
302,453,168
Total expenditure
(20,225,765)
(19,735,829)
Bene˜ts accrued before tax
194,289,159
282,717,339
Tax expense
(18,131,510)
(24,926,482)
Bene˜ts accrued after tax
176,157,649
257,790,857
A copy of the full audited financial accounts is available on request (call
1300 360 988
) or may be downloaded from
www.firstsuper.com.au
Financial Information
15
Annual Report
2011-2012

Changes to Super
Superannuation
G
uarantee
The Government intends to increase the
Superannuation Guarantee from 9% to 12% in small

increments from 1 July 2013 to 1 July 2019. It also
intends to remove the Superannuation Guarantee ag e
limit of 70 with effect from 1 July 2013. Both chang es

are linked to implementation of the Minerals Resource

Rent Tax.
Superannuation contributions
for low income employees
A new contribution of up to $500 (not indexed) will
be provided by the Government for individuals with

an adjusted taxable income of up to $37,000 if they
satisfy certain other conditions. This is intended to be a
rebate of the 15% contributions tax on Superannuation

Guarantee contributions and applies to contributions

made from 1 July 2012. This means that in effect,

qualifying low-income earners SG contributions will be
tax-free.
R
efund of excess concessional
contributions
Effective from 1 July 2011, people who breach the
concessional contributions cap by $10,000 or less can

request the excess contributions be withdrawn from
their super fund and refunded to them. These amounts
will be taxed at the recipient™s marg inal tax rate.
C
o-contribution reduction
The superannuation co-contribution has been reduced

to 50¢ for each $1 contribution an eligible person

makes from their after-tax income (subject

to conditions).
The new maximum co-contribution is $500 a year
if total income is less than $31,920 a year. The

co-contribution also reduces for those earning up to
a maximum of $46,920. The co-contribution is based
on assessable income, reportable fring e benefits and

reportable employer superannuation contributions, less

any deductions for carrying on a business.
R
eportable Employer Superannuation
C
ontributions
Employers have been required to report details of
employees™ reportable employer superannuation

contributions from 1 July 2009. Reportable employer
superannuation contributions include salary sacrifice
contributions and voluntary employer contributions

over which an employee has some control.
The Government has amended the definition of

Reportable Employer Superannuation Contributions

retrospectively back to 1 July 2009. This change may
mean that the amount reported reduces for some
members. If this happens, you should consider lodging an
amendment to your tax return to take advantage of any

reduction in the reported amount. Reportable employer
superannuation contributions are taken into account
when assessing elig ibility for government benefits.
First Super cannot advise you on whether this measure

affects you or not. You should speak with your

employer, accountant or tax adviser.
Over the last 12 months the Commonwealth Government has announced a large
number of changes affecting superannuation. Not all were law at the time this
report was produced, so you should seek up-to-date information before acting on
information contained in the report. If you are unsure about how superannuation
chang es might affect you call
1300 360 988
and ask to speak to a First Super
Financial Planner.
Changes announced by the Government that may affect First Super are summarised below.
16

Super Reform

A new licensing system to allow funds to offer a
ﬁMySuperﬂ product. MySuper products will have to
meet special rules relating to fees and charges.
MySuper products are intended to be simple
products with lower costs and reduced member

services intended for use by members who don™t

want a say in managing their super. MySuper

products will be available from some time in 2013,
and many members will be automatically
transferred into a MySuper product unless they

elect to do otherwise.

The Government regulator (APRA) will be g iven
powers to impose prudential standards on

superannuation funds, affecting how funds are

manag ed. Many of these requirements are not new,
but constitute more detailed instructions on how
particular activities must be carried out. It is not

expected that the prudential standards will have

any adverse affects on First Super or First Super

members.

New restrictions will be imposed on how members
can access advice about super from their super

fund. This includes limiting the use of general fee
income to partially pay for investment advice that
is available to all members. Generally, the cost of

investment advice will have to be billed to the

person receiving the advice. While this is expected

to result in more fairness between members, it
may also lead to a reduction in the services some
funds can provide to members.

The Government is introducing new data and
reporting protocols for use by the superannuation

industry. The changes are intended to result in

increased efficiency by standardising some

superannuation administration practices and the
way that employers pay contributions to
superannuation funds.

The Government will require super funds to use
tax file numbers (TFNs) to locate and consolidate

multiple accounts held by members. This will
result in lower overall costs for some members, but
may result in loss of some insurance benefits

for others.

From 1 July 2012, employers have been required to
provide information on an employee™s payslip

about the amount of super actually paid into the

employee™s super fund account during the pay

period. From 1 July 2013, super funds will be

required to either issue six monthly statements
which show contributions made, or report
electronically to members on whether they have

received or not received any super contributions
for that quarter.
The Government is implementing a raft of leg islation that will substantially
chang e the superannuation system. This involves several elements including:
17
Annual Report
2011-2012

Bene˜ts
Bene˜ts paid by the
F
irst Super
Accumulation
D
ivision
Withdrawal Benefit
When you leave the Fund, we will pay a Withdrawal
Benefit, which is the balance of your MemberAccount.

You do not have to take a Withdrawal Benefit if you
leave your current employer; you can keep your money
in the Fund. In most cases, you can also choose to have

future super contributions from different employers

made to your First Super account.
R
etirement Benefit
When permitted by law, you can receive a Retirement

Benefit. Your Retirement Benefit can be taken as

multiple drawdowns. You may be able to draw on
your Retirement Benefit if you are ag ed 55 or over
and still working, by using a Transition to Retirement

strategy. Otherwise, to begin drawing your Retirement

Benefit, you must generally reach:

your preservation age (currently age 55), and
permanently retire from the workforce;

ag e 60 and cease gainful employment with an
employer; or

age 65.
D
eath Benefit
If you die while you are a member of First Super,

your account balance will be paid as a lump sum. In

addition, any insured Death Benefit may also become
payable, provided the Fund’s insurer accepts a claim
for payment. Who will receive your death benefit

when you die depends on the law and what you ask

us to do. You have two available options:
(i)

Do nothing, in which case the law requires the
Trustee to pay your benefit to your dependants or

estate or, if neither exists, to another person; or
(ii)

Complete a Non-binding Nomination of
Beneficiary form.
A Non-binding Nomination of Beneficiary form

allows you to nominate your preferred beneficiary or
beneficiaries. The Trustee will take this into account

when making a payment, but will ultimately decide

who should receive your Death Benefit according

to the law. Payment will usually be made to one
or more of your dependants or your legal personal
representative.A Binding Nomination of Beneficiary
form directs The Trustee to pay your Death Benefit to

the nominated person(s) provided that it is legal for
the Trustee to do so.
Under superannuation law, a dependant is generally
a child, a spouse or a person with whom you have an
interdependency relationship. Two people may have
an interdependency relationship if:

they have a close personal relationship;

they live together;

one or each of them provides the other with
financial support; and/or

one or each of them provides the other with
domestic support and personal care.
An interdependency relationship may also exist

where there is a close personal relationship between

two people who do not satisfy other criteria because

either or both of them suffer from a physical,

intellectual or psychiatric disability. Examples of
interdependency relationships may include:

same-sex couples who reside tog ether and are
interdependent;

siblings who reside tog ether; or

an adult child who resides with and cares for an
elderly parent.
Terminal
I
llness Benefit
If you are diagnosed as having a terminal illness
whilst you are a member of the Fund, an amount

equivalent to your Death Benefit may become
payable while you are still alive, provided that the
insurer accepts your claim for payment.
Total &
P
ermanent
D
isablement Benefit
If you become totally and permanently disabled

(TPD), the balance of your First Super account may

become payable. In addition, any insured TBD Benefit
may also become payable if the Insurer accepts your
claim for payment.
18

I
ncome
P
rotection Benefit
Income Protection Benefits are available to members
who decide to apply for cover and whose claims

are accepted by First Super’s insurer. Generally, this
insurance provides a benefit of up to 85% of your
salary if you are unable to work due to temporary

illness or injury.
F
inancial Hardship &
C
ompassionate Benefits
You may be able to access some of your

superannuation account under‚Financial Hardship™

or ‚Compassionate™ grounds.
The criteria set by the Government for payment of
these benefits is summarised below.
To be eligible for a
F
inancial Hardship Benefit, you
must have:

Been in receipt of a specified Commonwealth
income support payment (e.g. NewstartAllowance)
for a continuous period of 26 weeks and be unable
to meet immediate family living expenses; or

Reached your superannuation preservation ag e;
and

Received Commonwealth income support
payments for a cumulative period of 39 weeks after
reaching preservation ag e and not been gainfully

employed on a full-time, or part-time, basis on the

date of the application.
Applications may be lodged with the Trustee and will

be assessed according to the relevant law. Approval is
not automatic.
Applications for a
C
ompassionate Benefit may be
submitted to the Australian
P
rudential
R
egulation
Authority (A
PR
A) and must relate to paying or

meeting an expense of:

treatment and transport for you or a dependant
concerning life-threatening illness or injury, acute
or chronic pain, or acute or chronic mental

disturbance;

modifying your home or motor vehicle if you or a
dependant has a severe disability;

palliative care for you or a dependant, or the death,
funeral or burial expenses of a dependant;

mortgage payments to prevent your lender selling
your home; or

similar grounds.
To apply for a Compassionate Benefit, please contact

the Australian Prudential Regulatory Authority at

www.apra.gov.au
I
nsurance issued in error
Insurance cover issued in error is invalid. If you have

been allocated any insurance cover by First Super and

it is subsequently discovered you were ineligible to
receive it for any reason, all premiums paid will be
refunded to your account along with an allowance for

any investment earnings lost.
19
Annual Report
2011-2012

Bene˜ts paid by

the First
Super Allocated
Pension Division
F
irst Super offers two allocated
pensions:

An Allocated Pension, and

A Transition to Retirement Allocated
Pension.
The Allocated
P
ension
An Allocated Pension lets you convert your
superannuation into regular income in retirement.

You can choose the number of payments you wish to
receive and their frequency, which can be monthly,
quarterly, half-yearly or yearly.
You can also draw down lump sums when it suits
you. The minimum lump sum withdrawal is $1,000 Œ

and a lump sum withdrawal cannot occur until you

have received at least one regular income payment.

This is a legal requirement that cannot be waived.
The government has made rules about the amount
you can draw down in a year, and these are
summarised below under the heading ‘Government

Limits on Payments’.
The Transition to
R
etirement
Allocated
P
ension
The Transition to Retirement Allocated Pension can

g ive you a tax-effective income stream while you™re

still working, but there are restrictions on the amount
you can withdraw. These are explained below.
If you are 55 years of ag e or older, a Transition to
Retirement Pension can help you ease your way into
retirement without sacrificing your standard of living.
Depending on your circumstances, it may help you to:

R
educe your working hours.
If you want to cut
back your hours of work, you can replace any

income lost by drawing regular payments from
your Transition to Retirement Pension.

I
ncrease your retirement savings.
By making extra
contributions to your super account via a salary
sacrifice arrangement, you may increase your

retirement savings.

P
ay less tax.
If you are between 55 and 60 years of
ag e, yourAllocated Pension payments will be

subject to tax. However, some of your payments

may be tax-free and you™ll receive a 15% tax offset
on any taxable proportion. Once you reach ag e 60,

all of your Transition to Retirement Pension
payments will become tax-free.
When you permanently retire, your Transition to

Retirement Pension will convert to an Allocated
Pension Œ but if you decide before then that you want

to stop your Transition to Retirement Pension you can

roll the balance of your account back into your First

Super Accumulation Account.
Call us on
1300 360 988
or visit

www.firstsuper.com.au
to download a

copy of the First Super Allocated Pension PDS.
G
overnment limits on payments
Minimum annual payment: For both Allocated
Pensions Payments, at least one payment of a

minimum amount must be made at least once a year.
The minimum amount is a percentag e of account
balance by the ag e shown below.
Ag e
Annual percentage

of account balance
55Œ64
4
65Œ74
5
75Œ84
6
85Œ94
10
95+
14
But:
the Government has announced a temporary

75% reduction in the minimum drawdown amount

that members must take. This arrang ement may
change again without notice.
Contact us on
1300 360 988
for more information.
Maximum payment:
For the Transition to
Retirement Pension, the maximum that can be
withdrawn in any year equals 10% of your account

balance at the start of each year. This means that

if you have $100,000 in your account, you can

withdraw a maximum of $10,000 over the year.
There is no limit on the maximum withdrawal
amount for Allocated Pensioners.
20

Other important
information
Value of your member account
The value of each First Super member™s investment
is recorded in your member account. Except for the

Income Protection Benefit, benefits paid out by the
Fund are paid from or include the balance of your
member account. The balance of your member

account equals:

the total contributions and transfers paid in,

less
tax, fees and charges, insurance premiums and
any previous withdrawals or transfers out of the

account

plus
investment gains or losses. Investment
earnings (negative or positive) are calculated

monthly and applied to your account when you
leave the Fund, make a partial withdrawal or on

30 June or each year.All investment earnings are
declared after deduction of investment tax, fees

and costs.
How to claim a benefit
Please contact us if you would like to claim a benefit

or to enquire about setting up an Allocated Pension.
Accumulation Division members should note that
the Government has placed restrictions on when you

can claim superannuation benefits. In general, access
depends upon the ‘preservation’ classification that
applies. There are three classes of preservation:
(1)

U
nrestricted non-preserved benefits:
These
are benefits that are generally rolled over from

another superannuation fund, but could have

been cashed previously; they can be paid to you
at any time.
(2)

R
estricted non-preserved benefits:
These benefits

are not preserved, but they cannot be cashed until
you leave service with your current employer or

are otherwise eligible.
(3)

P
reserved benefits:
All contributions and earnings

paid or accruing from 1 July 1999 are preserved
in the superannuation system until an approved
benefit can be paid, (for example, through

retirement, death, disability or commencement of

an Allocated Pension).
Preservation of benefits is complex, and the

Government may change the rules from time to time.
You can contact the First Super Trustee for up-to-date
information.
P
ayment restrictions
The Fund is subject to a range of legislation, some of

which means that benefit payments cannot be made

to any person unless that person provides sufficient
identification material to comply with the
Anti Money
Laundering and Counter Terrorism Financing Act 2006
(Cth).
I
nsurance
Accidents do happen. People g et sick. First Super™s

insurance can help you to minimise the financial

impact on you and your family. You can get the death,
disability (TPD) and income protection insurance
cover you need without the hassle or cost of doing it

yourself.
Types of cover
D
eath:
is a lump sum benefit paid if you die or are

diagnosed with a terminal illness. This money can

help pay for your funeral, cover your debts and
provide for your dependants.
T
PD
:
is a lump sum benefit paid if you suffer a total
and permanent disability. The money can help cover
the long-term costs of a disability, including medical

treatment, ongoing care and modifications to your

home.
I
ncome
P
rotection:
is a monthly benefit that replaces
up to 85% of your income if you can™t work because of
sickness or injury. These payments can help you pay
your day-to-day expenses.
How much does it cost?
Premiums for these insurance packages are paid out

of your super account. Premiums depend on factors

including age, g ender and the level of risk in your
occupation. At the date this report was published,
premiums for Death and TPD insurance started at as

little as $1.17 per week per unit of cover.
You can find out how much insurance you currently
have, and how much it costs, by checking your annual
super statement or by calling First Super on

1300 360 988.
You can also apply to increase your cover up to

$2 million.
Please see the PDS for information on default
insurance and for the terms and conditions that

apply to insurance.
21
Annual Report
2011-2012

TRU
ST

DEE
D C
HAN
G
ES
The Trust Deed contains the rules of the Fund. There
were no chang es to the Trust Deed during 2011-2012.
DE
RI
VAT
I
VES

First Super and external investment managers

may use derivative investments to help manag e

risk and for other defensive purposes. Derivative
investments are not used for speculative investing.
Where derivative investments are used, the Trustee

considers the associated risks and controls that are in

place by monitoring the managers™ Risk Manag ement

Statement and preparing its own.
S
O
CI
ALL
Y
RES
P
ONS
I
BLE

INVEST
I
N
G

Labour standards and environmental, social or ethical

considerations may be taken into account in the

selection, retention or realisation of investments.
SUP
E
R
ANN
U
AT
I
ON

S
URC
HA
RG
E

The superannuation surcharg e payable by high

income earners on contributions and termination

payments made on or after 1 July 2005 has been
abolished. However, the ATO continues to send
assessments relating to prior years. Should First

Super receive such an assessment, we will deduct the

charg e directly from your account.
P
R
OTE
C
T
I
N
G Y
O
UR
BENE
FI
T
Commonwealth Government regulations protect the

benefits of members with superannuation account

balances of less than $1,000. Normally, fees for small
account holders may not exceed the amount of
earnings credited to your account. But in times of

a negative investment return, the amount charg ed

may be up to $10 in direct fees. This ensures that

your investment is usually protected and does not
g et eroded by fees and charg es. Tax and insurance
premiums will, however, continue to be deducted

from your account, regardless of your balance, until it

reaches zero.
E
L
IGI
BLE

ROLLOVE
R
F
U
N
D (E
RF
)
In accordance with superannuation legislation, First

Super has nominated an Elig ible Rollover Fund (ERF)

to receive the accounts of lost members or members
with small, inactive accounts. Our nominated ERF is
Australia™s Unclaimed Super Fund (AUSfund).
The Government has provided for lost and inactive
members with an account balance of $200 or less to

be transferred to the ATO instead of an ERF. However,

being transferred to AUSFund or the ATO may affect

your benefits in other ways because:

You will cease to be a member of First Super; and

Any insurance cover you had with First Super will
cease.
Neither AUSfund nor the ATO offers insured benefits

in the event of death or disability and may have a

different investment strategy to First Super. If your

benefit is transferred to AUSfund or theATO, you will
become subject to the governing rules the operations
of either AUSfund or theATO.
If First Super can provideAUSfund with current
contact details, it will send you its current Product

Disclosure Statement (PDS). You can also ask

AUSfund for a copy of its PDS.
If First Super is required to transfer your account to
the ATO, the ATO should make efforts to contact you.
Both AUSfund and the ATO will generally protect
accounts from erosion due to any administration levy

or fees.
You can contact AUSFund at:
AUSfund Administration

PO Box 2468

Kent Town SA 5071
T:
1300 361 798 (for the cost of a local call)
F
:
1300 366 233 (for the cost of a local call)
E:
admin@AUSfund.net.au

W:
www.unclaimedsuper.com.au
You can contact theATO by calling
13 10 20
or
visiting
www.ato.gov.au
22

COM
P
LA
I
NTS
The Trustee has established a procedure to deal
fairly with member complaints.All complaints will

be handled in a courteous and confidential manner,
and will be properly considered and dealt with within
90 days. If you believe you have a complaint, please

write to:
Superannuation Complaints Officer

c/o First Super

PO Box 666

Carlton South VIC 3053
Once the Trustee has investigated your complaint,

you will receive a written reply explaining the
Trustee™s decision. If you are not satisfied with this
decision, you may choose to take your complaint to

the Superannuation Complaints Tribunal (SCT).
The SCT is an independent body established by
the Commonwealth Government to review certain

types of Trustee decisions. If the SCT accepts your

complaint, it will attempt to resolve the matter
through conciliation, which involves assisting you
and the Fund to reach a mutual agreement.
If conciliation is unsuccessful, the SCT will make a
determination, which is binding. Time limits apply to
making certain complaints, particularly in relation to

Death & Total and Permanent Disablement benefits,

so you should approach the SCT promptly if you are
dissatisfied with the decision of the Trustee.
If you wish to find out whether the Tribunal can
handle your complaint and the type of information

you would need to provide, you can contact the SCT

at:
Locked Bag 3060, Melbourne VIC 3001
T:

1300 884 114

F
:

03 8635 5588

info@sct.gov.au

www.sct.gov.au
If your complaint is outside the jurisdiction of the
SCT, you might be able to take it to the Financial
Ombudsman Service (FOS). FOS can be contacted at:
Financial Ombudsman Service (FOS)
GPO Box 3

Melbourne VIC 3001

1300 780 808

www.fos.org.au
This service is provided to you free of charge.
P
RI
VA
CY

First Super has arrang ements in place to protect the
privacy of members™ personal information, which

will only be shared with other organisations for
the purpose of administering your account or as
otherwise authorised by you. A copy of our Privacy

Policy is available on request.
P
R
OV
IDI
N
G Y
O
UR T
A
X
F
I
LE
NU
MBE
R (T
F
N)
Under the Superannuation Industry (Supervision)

Act 1993, your superannuation fund is authorised to

collect your TFN, which will only be used for lawful
purposes. These purposes may chang e in the future
as a result of leg islative change.
The trustee of your superannuation fund may
disclose your TFN to another superannuation

provider, when your benefits are being

transferred, unless you request the trustee of your

superannuation fund in writing that your TFN not be
disclosed to any other superannuation provider.
It is not an offence not to quote your TFN. However
g iving your TFN to your superannuation fund will

have the following advantag es (which may not

otherwise apply):
(i)

your superannuation fund will be able to accept
all types of contributions to your account/s;
(ii)

the tax on contributions to your superannuation
account/s will not increase;
(iii)

other than the tax that may ordinarily apply, no
additional tax will be deducted when you start
drawing down your superannuation benefits; and
(iv)

it will make it much easier to trace different
superannuation accounts in your name so that

you receive all your superannuation benefits

when you retire.
You may provide your TFN orally or in writing

(including electronically). Your annual Member

Benefit Statement shows whether you have supplied
your TFN. If you have not supplied us with your TFN
but would like to do so, please contact us on

1300 360 988
.
23
Annual Report
2011-2012

A
n

I
n
d
u
s
t
r
y
Super
F
un
d
This report was prepared by First Super Pty Ltd (ABN 42 053 498 472 AFSL 223988, RSEL L0003049), Trustee of the First Super superannuation fund (Fund)

ABN 56 286 625 181 RSER 1067385. The material in this report is a summary only. The rules of the Fund are located in the Trust Deed and relevant law. In the event of
any inconsistency between this report and the rules, the rules of the Fund prevail. This report was prepared without taking into account your objectives, financial situation

or needs. You should consider the appropriateness of the material in light of your own objectives, financial situation or needs before making a decision. You can obtain

a copy of the Product Disclosure Statement by contacting us. Facts and figures appearing in this report were accurate at October 2012 but may change without notice.
TALK TO SOMEONE

WHO KNOWS
First Super™s Coordinators are available to
help with more complicated issues. They can

speak with you over the phone or visit your
workplace. First Super™s Financial Planner
is also available to discuss the financial
planning services available to you.
We will provide you with any information
you reasonably require to understand

your benefit.
This includes, but is not limited to:

benefit quotes

the trust deed

audited accounts

insurance policies

product disclosure statements, and

the Risk Management Plan.
You can also obtain a printed copy of this
annual report or the PDS at no charg e by
contacting us.
N
EE
D
HEL
P
TO
G
ET
Y
O
UR
FI
NAN
C
ES

T
R
A
C
K
?
A financial planner can help you to:

better manage your money

sort out your super

achieve your financial goals (such as
reduce debt, increase savings)

identify your insurance needs, to help
protect you and your family

access your super when you turn 55

make the most of a redundancy payout

plan for your retirement and access
government benefits.
Our financial planners receive no

commissions for signing you up to a

particular product or service; they work on

a fee-for-service basis, so you™ll know what

it™s going to cost you up-front.
Your initial consultation is free. First Super
members ag ed 45+ or any member facing
redundancy can access a $250 fixed fee

service for basic financial plans.*
* Financial planning is supplied by Industry Fund Financial Planning
(IFFP). IFFP is a division of Industry Fund Services Pty Ltd ŒABN 54
007 016 195, AFSL 232514. Complex plans may incur a higher fee. Offer
current at October 2012 but may be varied or withdrawn at any time.
Need more information?
For information or assistance regarding your super account, contact us:
C
a ll:

13 00 360 988
Web:

www.˜ rst super.c om.au
E-mail:

ma il@˜ rs tsuper.c om.au
F
a x:

1300 362 89 9
Addr ess:

L evel 3, 200 A rden St

North Mel bou r ne, V ic 3051

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First Super Annual Report 2011_12

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