- Milford Asset

Transcription

- Milford Asset

Investment Statement
Milford Funds Limited
6 December 2013
Milford
KiwiSaver Plan
Milford KiwiSaver Plan
Important
information
(The information in this section is required under the Securities
Act 1978.)
Financial advisers can help you make
investment decisions
Investment decisions are very important. They often have longterm consequences. Read all documents carefully.
Ask questions. Seek advice before committing yourself.
Using a financial adviser cannot prevent you from losing
money, but it should be able to help you make better
investment decisions.
Financial advisers are regulated by the Financial Markets
Authority to varying levels, depending on the type of adviser
and the nature of the services they provide. Some financial
advisers are only allowed to provide advice on a limited range
of products.
Choosing an investment
When deciding whether to invest, consider carefully the
answers to the following questions that can be found
on the pages noted below:
What sort of investment is this? 22
Who is involved in providing it for me? 23
How much do I pay? 25
What are the charges? 27
What returns will I get? 30
What are my risks? 34
Can the investment be altered? 37
How do I cash in my investment? 38
Who do I contact with inquiries about my investment? 39
Is there anyone to whom I can complain if
I have problems with the investment? 40
What other information can I obtain
about this investment? 41
When seeking or receiving financial advice,
you should check:
> the type of adviser you are dealing with;
> the services the adviser can provide you with;
> the products the adviser can advise you on.
A financial adviser who provides you with personalised
financial adviser services may be required to give you a
disclosure statement covering these and other matters.
You should ask your adviser about how he or she is paid
and any conflicts of interest he or she may have.
Financial advisers must have a complaints process in place
and they, or the financial services provider they work for,
must belong to a dispute resolution scheme if they provide
services to retail clients. So if there is a dispute over an
investment, you can ask someone independent to resolve it.
In addition to the information in this document,
important information can be found in the current
registered prospectus for the investment. You are
entitled to a copy of that prospectus on request.
Most financial advisers, or the financial services provider
they work for, must also be registered on the financial
service providers register. You can search for information about
registered financial service providers at
www.fspr.govt.nz
The Financial Markets Authority regulates
conduct in financial markets
You can also complain to the Financial Markets Authority if
you have concerns about the behaviour of a financial adviser.
The Financial Markets Authority regulates conduct in
New Zealand’s financial markets. The Financial Markets
Authority’s main objective is to promote and facilitate
the development of fair, efficient, and transparent
financial markets.
This document is an Investment Statement for the purposes
of the Securities Act 1978. It is dated and prepared on
6 December 2013. Note that law and regulation relating to
KiwiSaver schemes can change.
For more information about investing,
go to www.fma.govt.nz
Capitalised terms are defined throughout this document,
or in the glossary on page 50.
Prospective members should obtain financial, legal and taxation
advice before making any financial investment decision.
Investment Statement 6 December 2013
Letter from
the Manager
of the Milford
KiwiSaver Plan
Dear Investor
We are strong supporters of KiwiSaver
as it will play an important role in
raising New Zealand’s savings levels
and reducing investors’ dependence on
residential property. We are therefore
delighted to offer KiwiSaver investors
access to our unique and successful
investment approach through the
Milford KiwiSaver Active Growth Fund,
the Milford KiwiSaver Balanced Fund
and the Milford KiwiSaver Conservative
Fund. For all three Funds we:
> aim to preserve capital while still
generating growth for our investors;
> have chosen to have fair and simple
fees that only provide us with higher
rewards when our performance
means we have earned them; and
> are committed to transparency
so that our investors can see
clearly the investments that make
up these Funds.
At Milford our primary objective is to
make money for you – our clients.
We do this through taking a highly active
approach to management of investment
portfolios in order to take advantage
of changing market conditions and
opportunities.
The Milford KiwiSaver Plan is offered
by Milford Funds Limited, a 100%
owned subsidiary of Milford Asset
Management Limited. Milford manages
individual investment portfolios for
high net worth individuals and for
large organisations. Milford will also
be a strong advocate on your behalf,
particularly in terms of corporate
governance of the entities we invest in.
We are proud to say that Milford has
gone from strength to strength – with
funds that we manage rising to more
than $2.5 billion, as at the date of this
Investment Statement.
We believe that the Funds described in
this Investment Statement are suited
to medium to long-term investors.
Please note that Milford KiwiSaver Plan
Members have the tax advantages
of investing into these Funds under
the PIE regime for as long as the
Funds remain eligible to be PIEs.
No person, including Milford’s parent
company (Milford Asset Management
Limited) provides any guarantee of the
performance of Funds offered in this
Please read this Investment Statement
in full to ensure that the approach and
objectives for the Funds are consistent
with your requirements as a KiwiSaver
investor. If you have any questions
please visit our website at
www.milfordasset.com or call us on
(09) 921 4700 or 0800 662 346.
Yours sincerely,
Brian Gaynor
Director, Milford Funds Limited
6 December 2013
1
Key information
The Plan consists of Funds that are managed by
Milford Funds Limited. The trustee of the Plan is
Trustees Executors Limited.
The Plan is an investment structure where a
trustee (or a custodian appointed by the trustee)
holds the assets of the Plan for the benefit of all
members who hold units in the Plan. We make
the investment management decisions but the
assets of the Funds are held separately from,
and independent of, us. As a member, you will
receive units in the Plan, in whichever Fund(s)
you choose to invest in.
These tables provide a
snapshot of key information
about the Funds. You should
read it in conjunction with
the detailed information
set out elsewhere in this
Investment Statement,
and in the Plan’s Prospectus.
The Plan is a Portfolio Investment Entity (‘PIE’)
for tax purposes. Broadly, this means that all
returns of a Fund will be attributed to you and
the other investors in proportion to the units that
you hold in the Fund. Any income attributed
to you is taxed within the Fund at the tax rate
selected by you. Further details on tax matters
are set out on pages 32 and 33.
Milford KiwiSaver Conservative Fund
Fund objective and investment policy
Principal risks
The Milford KiwiSaver Conservative Fund’s objective is to
provide consistent returns with relatively low levels of risk by
mainly holding a diversified mix of yield oriented investments
which will sometimes be augmented by some growth assets
and to take an active approach to sector and security selection.
The principal risks of investing in the Milford KiwiSaver
Conservative Fund are Market risk, Entity risk and Interest
rate risk. For more details, please see pages 34 to 35.
The Fund may gain this exposure by investing directly or into
Milford Unit Trust PIE Funds, other funds, or Milford Wholesale
Funds that we manage.
> No entry, exit or switching fees are currently charged.
The Fund may use derivative products, short-sell securities
and utilise leverage and active currency management.
For more information about this Fund, see pages 16 to 21.
Fees and expenses
> We will be paid a capped management fee of 1.05%
(including applicable GST) per annum of the gross
asset value of the Fund.
> Member administration and registry fee
of $36 per annum for the Plan.
> Any management or performance fees charged
by international fund managers are in addition to
any Milford fees and are deducted from the Fund.
For more details, please see pages 27 to 29.
2
Milford KiwiSaver Balanced Fund
Principal risks
The Milford KiwiSaver Balanced Fund’s objective is to provide
consistent positive long-term capital growth, typically from
a diversified mix of investments including New Zealand fixed
interest securities and equities and global fixed interest
securities and equities. These investments may be held
directly or indirectly through pooled funds.
Balanced Fund are Market risk, Entity risk and Currency
risk. For more details, please see pages 34 to 35.
The Fund will be actively managed in terms of the sector
weightings to reflect our investment outlook. It aims to
generate positive returns in good and bad times. It can
hold material levels of cash or low risk investments when
attractive investment opportunities are scarce. Its investment
mix may include investments in entities and with our
selected managers outside of Australasia.
The Fund may gain this exposure through investing directly
or into Milford Unit Trust PIE Funds, other funds or one or
more of the Milford Wholesale Funds. The Milford KiwiSaver
Balanced Fund may also make investments outside of
Australasia with managers selected by us. The Fund may use
derivative products, short-sell securities and utilise leverage
and active currency management.
Fees and expenses
> We will be paid a capped management fee of 1.05%
(including applicable GST) per annum of the gross asset
value of the Fund.
> No performance fee is paid directly from the Milford
KiwiSaver Balanced Fund, although we will potentially
receive performance fees on any Milford KiwiSaver
Balanced Fund investments in the Milford KiwiSaver
Active Growth
Fund and Milford Unit Trust PIE Global, Trans-Tasman
and Dynamic Funds in our capacity as manager of
these other Funds.
> Member administration and registry fee
of $36 per annum for the Plan.
> Any management or performance fees charged by
international fund managers are in addition to any
Milford fees and are deducted from the Fund.
3
The Milford KiwiSaver
Active Growth Fund’s
objective is to generate
positive annual returns
of at least 10% (after fees
and before tax), in good
and bad markets.
Milford KiwiSaver Active Growth Fund
Principal risks
The Milford KiwiSaver Active Growth Fund’s objective is to
generate positive annual returns of at least 10% (after fees
and before tax), in good and bad markets.
Active Growth Fund are Market risk, Entity risk and
Currency risk. For more details, please see pages 34 to 35.
To achieve this, the Fund is actively managed and will usually
be primarily invested directly (or indirectly through pooled
funds) in equities in New Zealand, Australian and global
entities. However, it can hold material levels of cash and fixed
interest securities when attractive opportunities are scarce and
we consider the prospect for share markets poor.
The Fund may gain this exposure through investing directly
or into wholesale funds managed by us. The Fund may use
derivative products, short-sell securities and utilise leverage
and active currency management.
Fees and expenses
> We will be paid a capped management fee of
1.05% (including applicable GST) per annum
of the gross asset value of the Fund.
> We may be paid a performance fee from the Fund.
> Member administration and registry fee of
$36 per annum for the Plan.
> Any management or performance fees charged by
international fund managers are in addition to any
Milford fees and are deducted from the Fund.
For more details, please see pages 27 to 29.
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All Funds
Admission of members
Benefits
Natural persons who meet any eligibility criteria in
the KiwiSaver Act may be admitted to membership
of the Plan in two ways:
The key benefits that an investment in the
Plan offers include:
> by completing an application for membership of
the Plan in accordance with sections 45 or 55
of the KiwiSaver Act; or
> if the Plan is an employer’s chosen KiwiSaver scheme,
by way of allocation to the Plan under section 48 of
the KiwiSaver Act.
We have the right under the Trust Deed to refuse any
application under the first bullet point above without giving
reasons for any refusal. Any initial contributions received by
the Plan from an applicant who is refused membership will
be returned without interest.
Cessation of membership
You shall cease to be a member of the Plan on the
first to occur of:
> The Funds are actively managed portfolios that provide
for a broad range of investment options.
> The Funds utilise the benefits of the PIE tax regime.
> The Funds are managed by us, a wholly owned subsidiary
of Milford Asset Management Limited.
Related Party transactions
We may deal with related parties of us or the Trustee
in certain limited circumstances, and upon following
the procedure set out in the Trust Deed, which includes
providing certification that the transaction is on arms
length commercial terms.
None of us, the Trustee or any related party of either of us
is liable to account to the Plan or you for any profit arising
from any such transaction.
> your death;
Fee changes
> you receiving your full benefit from the Plan in
accordance with the KiwiSaver Scheme Rules;
We may increase or impose new fees on giving written
notice to you and in accordance with the Trust Deed and
the KiwiSaver Act. At the date of this Investment Statement,
we have no intention to do so.
> you transferring from the Plan to another KiwiSaver
scheme (or to a superannuation scheme); and
> you receiving notice under rule 4(5)(b)
of the KiwiSaver Scheme Rules.
5
KiwiSaver is a
great way for
New Zealanders
to save for their
retirement
Incentives for savers
KiwiSaver is very popular with
investors because of the recognition
by New Zealanders of the need to save
for their retirement. It currently provides
incentives for savers including: a $1,000
kick-start, a minimum 3% compulsory
employer contribution for employed
members* and an annual tax credit of
up to $521.43 paid by the Government.
For example if an employee earning
$55,000 a year contributes 3% of
gross salary ($1,650) annually to their
KiwiSaver account, their employer will
then have to contribute a minimum
of $1,650 over the year and the
Government will pay in an annual tax
credit of $521.43.
Importance of return
and compounding
Due to the power of compounding
returns, the potential size of your
KiwiSaver savings can become very
significant. Based on annual returns
of between 2.5% and 10% (after fees
and tax) the estimated savings when
an individual reaches 65 is shown
in the chart opposite.
Please note that the generic illustration
opposite is only to show the positive
effect of compounding returns.
No returns are guaranteed or assured,
and returns can be negative, particularly
given the length of the investment
period shown in the illustration.
It assumes a starting salary of
$30,000, salary growth of 3% per
annum, employee and employer
contributions of 3% of pre-tax pay
to KiwiSaver*, annual Government
contributions commensurate with
salary levels, a Government kick-start
of $1,000 received in the first year,
no contributions holidays are taken
and that future values are not
adjusted for the impact of inflation.
* Since 1 April 2012 employer superannuation tax has been levied on the employee contribution at your marginal tax rate. The numbers above allow for both of these changes.
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Potential Future Value of KiwiSaver savings
(not adjusted for the impact of inflation)
$2,200,000
$2,000,000
$1,800,000
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
0
5
10
15
20
25
30
35
40
45
years
10.0% p.a
Assumptions
2013+
7.5% p.a
5.0% p.a
2.5% p.a
Assumed
return after
tax and fees
Number of years contributing to KiwiSaver
15 years
30 years
45 years
Starting Salary
$30,000
2.5%
$46,456
$134,696
$295,260
Salary Growth
3.0%
5.0%
$55,914
$197,289
$530,591
Contribution Rate
3.0%
7.5%
$67,731
$298,448
$1,028,767
Employer Contribution
2.6%*
10.0%
$82,514
$463,927
$2,115,153
To look at answers to questions relating to KiwiSaver in general or specifically on the
Milford KiwiSaver Plan you can also visit:
> the Milford website: www.milfordasset.com
> the Government KiwiSaver website: www.kiwisaver.govt.nz
> the Commission for Financial Literacy and Retirement Income website: www.sorted.org.nz
* Employer Superannuation Tax is levied on employer contributions.
7
Introduction to
Milford Asset
Management
Limited
We strongly believe
in the benefits of
being an employee
controlled company.
Milford Asset Management
Limited was formed in 2003
by a highly experienced
team of individuals who
recognised the need for
an investment company
that New Zealanders
can trust and which
provides a premium service.
In 2007, Milford Funds Limited
was created to enable investors
to gain access to Milford’s
investment expertise and vast
experience through our family
of funds.
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Milford’s core values are to:
The benefits of this include:
> Operate with honesty and integrity
> Attracting and retaining
the best people
> Consistently seek to deliver superior
investment returns
> Be client focused
> Strive for best practice
in managing our clients’ capital
> Remain majority New Zealand
and employee owned
> Understanding our clients’
needs and objectives
> Focusing our resources to generate
the best returns for clients
> Reacting quickly to changing market
conditions and new opportunities
> Aligning our success to the
performance of our clients’ capital
What’s behind
the name
Milford Asset
Management?
We wanted a name with
a New Zealand flavour
and chose ‘Milford Asset
Management’ for three
main reasons.
Firstly, we wanted something that
makes people think of New Zealand.
We chose a New Zealand icon
because we are proud to be
a New Zealand employee
controlled company.
Secondly, we wanted to invoke
Finally, because of the serenity and
peacefulness associated with Milford
Sound. We wanted investors to think
of investing with us as a pleasant
and rewarding journey, as we aim to
consistently produce superior returns
while protecting our clients’ capital.
the image of Mitre Peak, rising
slowly and steadily in the distance.
Like Mitre Peak, we intend to be
around for a very long time.
9
The Investor’s
Rights
We created ‘The Investor’s Rights’
which detail fundamental rights that
we believe every investor should expect
from organisations who look after
investors’ money. The seven Investor’s
Rights are set out as follows.
1. The right to have someone you
can trust looking after your money.
We have brought together some of
the country’s most experienced and
respected investment experts, each
with an impressive track record for
making quality financial decisions.
Our investment team, led by
Executive Director Brian Gaynor,
is committed to protecting and
building the wealth of our clients.
2. The right to know your investment
manager will act in your best interests.
Our investment focus is on entities
that we believe demonstrate
the highest levels of corporate
governance and a strong commitment
to their stakeholders. And if we
believe our standards are not being
met, we will seek change or sell our
shareholding in an effort to protect
your investment in the process.
10
3. The right to know exactly where
your money is being invested. We
provide monthly Fund updates
outlining the investment holdings
of a Fund and the percentage
value that each investment holding
represents against the total value
of the Fund. Our monthly Fund
updates also include details of a
Fund’s performance and market
performance.
4. The right to know the value of
your investments at any time.
You are able to view the value of your
investments and a history of
all transactions at any time online.
5. The right to sell your
investments without penalty.
Unlike some other institutions,
we do not penalise you if you
wish to move your investments
from Milford.
6. The right to expect your
investment manager to make
decisions designed to protect
and grow your investment.
We constantly assess everything that
affects the value of your investments.
This includes proactively altering our
investment strategy if our view of
the market,
a company’s management or trading
conditions change. Our policy of
seeking to protect your capital means
when we believe markets will fall
significantly, we don’t expect you to
simply weather the storm. Instead,
we act to preserve your capital.
7. The right to fair and reasonable
fees with a ‘pay for performance’
philosophy.
We charge a capped management
fee which varies depending on the
type of investment Fund. This fee
covers the normal operating costs
associated with managing a Fund
and making investment decisions
(including audit, trustee, registry and
legal fees). It excludes brokerage,
underlying fund manager fees and
any performance fee. A performance
fee is only charged if a Fund exceeds
its stated investment target.
A key to success for any
investment management
business is having the
right people. We believe
that we have one of the
highest calibre teams in
the market in terms of
experience and expertise.
Alastair Thomson, Graeme Thomas,
Erin Lyon, Murray Harris, Simon Walton,
Sean Donovan, Alistair Ross,
Kashish Mehra, Anthony Quirk,
Liz Searle, Bryce Marsden, Alex Chin,
Andrew Twidle, Sarah Mitchell (seated),
Rebecca Tappin, San Pama,
Jonathan Windust, Victoria Harris (seated),
Charlie Dent, William Curtayne,
Mark Warminger, Stephen Johnston,
Brian Gaynor, Brooke Bone (seated),
Felix Fok, David Lewis, Marc Whittaker.
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Milford’s
Investment
Team
We believe we have one of the
most experienced investment
teams in New Zealand.
For more biographies of our
wider Milford team,
please see our website
www.milfordasset.com
Brian is Chairman of Milford’s Investment Committee and head of Milford’s portfolio
management and investment analysis activities. Brian is one of New Zealand’s most
experienced and well-known investment analysts. Brian’s career includes roles as
a Partner and Head of Research at stockbrokers Jarden & Co, a member of the
New Zealand Stock Exchange, Chairman of the New Zealand Society of Investment
Analysts and Chairman of the Asian Securities Analysts Council. Brian is Portfolio
Manager of the Milford Active Growth Fund and the Milford KiwiSaver Active
Growth Fund.
Brian Gaynor
Jonathan Windust
Jonathan has a wide range of financial markets and investment experience both in New Zealand
and internationally. Prior to joining Milford in 2008, Jonathan worked for Gartmore Investment
Management in London where he was Portfolio Manager for the Royal Bank of Scotland
Pension scheme which had assets in excess of NZ$25 billion. While at Gartmore, Jonathan was
also responsible for investment strategy and investments into individual private equity funds
and companies across Europe and Asia. Prior to Gartmore, Jonathan worked for BT Funds
Management, Frank Russell and the New Zealand Dairy Board (now Fonterra). Jonathan is a
Chartered Financial Analyst (‘CFA’) charterholder and is Portfolio Manager of the Milford Income
Fund, the Milford Balanced Fund, the Milford KiwiSaver Balanced Fund and the Milford KiwiSaver
Conservative Fund.
Mark has a wide range of investment experience across financial markets both in New Zealand
and internationally. Prior to joining Milford in 2011, Mark worked for Macquarie Private Wealth
as Head of Investment Strategy in New Zealand. Prior to Macquarie, Mark worked as an
Investment Manager for Goldman Sachs New Zealand, managing two high performing
New Zealand and Australasian investment funds. Overseas, Mark managed US Equity Funds
for Foreign and Colonial Asset Management. Mark is the Portfolio Manager of the New Zealand
Equity portion of the Milford Trans-Tasman Fund and the Milford NZ Equities Wholesale Fund.
Mark Warminger
Australian born Marc has considerable experience in financial markets working in Sydney,
with over 14 years in equity analysis. Prior to joining Milford in 2010, Marc was an Associate
Director at Lazard Asia Pacific Asset Management in Sydney, specialising in technology,
telecoms, media, financials, gaming and developers and contractors. Marc held an earlier
position in equity analysis with UBS Australia, where he specialised in telecommunications
research. Marc is the Portfolio Manager of the Australian equity portion of the Milford
Trans-Tasman Fund. Marc is a CFA charterholder.
Marc Whittaker
12
William has specialist experience investing in small and medium sized companies. Since joining
Milford in early 2010, William has focused on selecting small and medium sized companies
for Milford’s Funds and has also covered the resource, energy, utility and property sectors.
As the Portfolio Manager for the Milford Dynamic Fund, William’s primary responsibility is the
performance of that Fund. In order to select superior investments, William visits and speaks to
hundreds of companies every year. Working closely with the rest of Milford’s Investment Team,
William conducts detailed investment analysis to uncover top class investments. William has a
Bachelor of Commerce from the University of Auckland majoring in Finance and Economics.
William Curtayne
Felix has a wide range of investment experience across global financial markets. Prior to joining
Milford in October 2012, Felix was a partner at equity research firm Ji Asia in Hong Kong,
an associate of French bank Societe Generale, covering China focused medium sized companies
across multiple sectors. Felix began his career in London in 2004 with The Black Ant Group as
an analyst, and later Junior Portfolio Manager, and helped manage a long/short global mandate
that invested across the capital spectrum. He holds a Master of Arts from the University of
Cambridge, where he studied chemical engineering. Felix is a CFA charterholder and is Portfolio
Manager of the Milford Global Fund.
Felix Fok
Stephen has a wide range of investment experience across global financial markets and
different asset classes. Prior to joining Milford in 2013, Stephen was a partner at London based
Adelante Asset Management where he was a Senior Portfolio Manager, managing
an Emerging Market Equity Fund. Prior to Adelante, Stephen was a Portfolio Manager in
London at Threadneedle Investments and Convivo Capital Management, managing various
Emerging Market Funds. Stephen holds a Bachelor of Laws and a Bachelor of Commerce
from the University of Otago and was admitted to the Bar as a Barrister and Solicitor of the
High Court of New Zealand in 1995.
Stephen Johnston
David Lewis
Brooke Bone
David joined Milford in early 2013 from Merrill Lynch where he was a Senior Director, working
for eight years in various roles in global credit markets based in Sydney and London. These roles
in London included Financial Institutions Credit Analyst and Head of Emerging Market Credit Research.
While in Sydney, David worked on proprietary risk positions in Merrill’s Special Situations business,
which focussed on high yield, loan, and distressed opportunities in Australia and New Zealand.
Prior to Merrill, David spent four years as a fixed income analyst at BT Funds Management and its
then-parent company Principal Global Investors, based in Sydney and London. At Milford, David works
on the Income Fund. David has a Bachelor of Commerce in Economics from the University of Canterbury,
a Master of Commerce in Finance from the University of Sydney, and is a CFA charterholder.
Brooke is a Senior Investment Analyst with a particular emphasis on special situations for
Milford’s Funds, including non-listed opportunities. Brooke previously worked for Macquarie
Securities in New Zealand as a Senior Research Analyst covering a variety of sectors including
manufacturing, agriculture, mining and oil and gas. Brooke was ranked as one of the top three
analysts in a number of INFINZ awards in 2010, 2011 and 2012. Prior to joining Macquarie,
Brooke was a Vice President at Morgan Stanley in London, covering Pan-European retail
companies. Brooke also worked for the corporate finance and property team of Marks
and Spencer in the UK and as a management consultant for Cap Gemini. He qualified as
a Chartered Accountant with Ernst & Young. Brooke is a CFA charterholder.
Victoria graduated from the University of Canterbury in 2010 with a Bachelor of Commerce,
double majoring in Economics and Finance. Victoria’s previous experience includes an internship
in the financial services industry in Auckland, New Zealand. Victoria joined Milford in 2011
in client services, and she has since moved into an Investment Analyst role. Victoria’s role
involves researching and analysing companies for potential investment, as well as undertaking
performance calculations for the various Funds. Victoria covers retail and technology companies
in Australia and New Zealand.
Victoria Harris
13
Investment
style
We adopt a highly active
approach to portfolio
management in order to
attempt to take advantage of
changing market conditions
and investment opportunities.
Key principles of our unique
approach are:
> Managing risk through appropriate
portfolio diversification
> Active portfolio management;
we do not follow a ‘buy and
hold’ approach
> Focusing on our key competencies.
Where we do not currently have
the skills or knowledge we identify
partners that do.
> A focus on looking to preserve
capital in bad times and invest
more aggressively in better times
> Detailed investment research
and regular entity visits
We believe that our approach and
philosophy will consistently generate
superior results for our clients.
> Understanding changes in
the global and local economic
environment and how this will impact
clients’ investments
Investment
process
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Our investment selection
process aims to identify
investments which have
prospects that have not
been recognised by other
investors in the market.
We focus on the following issues
when considering existing and
potential investments:
We conduct in-depth research
into potential and current investments
to understand the key drivers of
performance and future prospects.
We place significant importance
on meeting companies and have a
disciplined entity visit programme.
We are also able to leverage off the
extensive knowledge and experience
of our investment team.
> Management and governance
> Industry growth prospects
and dynamics
> Competitive position and strategy
> Financial prospects
>Valuation.
Our investment analysis is
supplemented by detailed economic
analysis which focuses on following
key economic indicators from
New Zealand and overseas.
The result of the investment analysis is
typically discussed at our twice weekly
Investment Committee meetings.
What we believe to be the best
investment ideas are then included,
where applicable, in each Fund by
the Portfolio Manager responsible
for that Fund.
At the date of this Investment
Statement, we can use external fund
managers for certain investments
outside of Australasia. In selecting
these managers, we have a preference
for managers that have similar
characteristics to us, namely,
that these managers are:
> Specialist investment firms
> Majority employee owned
> Staffed by highly experienced
investment professionals
> Operating with a like-minded
investment philosophy and approach.
New Zealand and global
listed entities
Unlisted
New Zealand
entities
Portfolio
Manager
implements
Cash
Investment
Committee
considers
recommendations
Investment decisions
confirmed
Brian Gaynor
(Chairman)
Jonathan Windust
Mark Warminger
Investment
universe
Milford’s
Investment
Process
New Zealand
and global
fixed interest
securities
Investment
Committee
Global
Investment
Managers
Marc Whittaker
William Curtayne
Felix Fok
Stephen Johnston
Economic and
Investment analysis
David Lewis
Brooke Bone
Victoria Harris
Industry
Analysis
Global
Themes
Company
Meetings
Manager
Research
Financial
Analysis
Assessment of
management
and governance
15
Introducing the
Milford Family
of Funds
As we have grown we have expanded
to offer additional investment funds to
meet the requirements of investors with
different risk tolerances.
This Investment Statement details
those funds that we offer in the Milford
KiwiSaver Plan: the Milford KiwiSaver
Conservative Fund, the Milford
KiwiSaver Balanced Fund and the
Milford KiwiSaver Active Growth Fund.
Our Unit Trust PIE Fund range includes
the Income Fund, Balanced Fund, Active
Growth Fund (closed to new investors),
Global Fund, Trans-Tasman Fund and the
Dynamic Fund.
16
These Funds are covered in a separate
Unit Trust PIE Funds Investment
Statement a copy of which can be
obtained by visiting our website at
www.milfordasset.com or calling us
on (09) 921 4700 or 0800 662 346.
All our Milford KiwiSaver Plan Funds and
Unit Trust Funds are Portfolio Investment
Entity (‘PIE’) registered. This has
potential tax benefits to you, enabling
your investment to be taxed at your own
marginal tax rate (the rate of tax the IRD
taxes you at individually for your last
dollar of income) or at a top rate of 28%.
Generally, gains made by any Milford
fund on the sale of equities in New
Zealand resident entities or Australian
resident listed entities
(on an ASX approved Index) will not
be liable for capital gains tax.
KiwiSaver offers you additional
incentives to save, while requiring that
in most circumstances your funds
remain invested until retirement.
The Milford Unit Trust PIE Funds do
allow you more flexibility to withdraw
your investment if required.
Together the Milford family of funds
offers you a range of alternatives
depending on your investment
requirements, investment goals and
tolerance for risk. The Milford family
of funds is pictured opposite.
Milford Unit Trust
PIE Funds
Conservative Fund
Income Fund
Balanced Fund
Balanced Fund
Active Growth Fund
Active Growth Fund
(This Fund is closed to new investors.)
Global Fund
Trans-Tasman Fund
Dynamic Fund
17
The Milford
KiwiSaver
Plan Funds
The Milford KiwiSaver Plan has three
Funds available to New Zealand investors:
> The Milford KiwiSaver Conservative
Fund (Conservative Fund)
> The Milford KiwiSaver Balanced
Fund (Balanced Fund)
> The Milford KiwiSaver Active Growth
Fund (Active Growth Fund)
The Conservative Fund is focused on
providing a lower level of risk than the
Active Growth Fund and the Balanced
Fund, through mainly holding a mix of
yield orientated investments.
The Balanced and Active Growth Funds
are focused on generating long-term
growth for their members and taking
appropriate levels of risk to achieve this.
Both Funds look to preserve capital
in addition to generating growth.
Because of this the Funds may hold
material levels of cash or low risk
investments, which may under
perform in a strongly rising market.
However, if we can successfully avoid
large losses in falling markets we expect
the Funds to perform well
over time with less volatile returns.
High
Illustrative Expected Risk and Return Profile for the Milford
KiwiSaver Plan Funds (individually and in combination)
Active Growth Fund
Expected Relative Return Profile
50% Balanced
50% Active Growth
Balanced Fund
50% Conservative Fund
50% Balanced Fund
Conservative Fund
Low
Expected Relative Risk/Volatility Profile
High
Members can split their KiwiSaver contributions between these Funds by indicating on the application form the proportion they wish to
allocate to each Fund.
18
What is the
difference between
the Funds?
> The Conservative Fund’s objective
is to provide consistent returns
with relatively low levels of risk by
mainly holding a diversified mix of
yield oriented investments (whether
directly or indirectly through pooled
funds) which are sometimes
augmented by some growth assets
and take an active approach to sector
and security selection. The Fund may
use derivative products, short-sell
securities and utilise leverage and
active currency management.
> The Balanced Fund’s objective is to
provide consistent positive long-term
capital growth from a diversified
mix of investments including
New Zealand fixed interest securities
and equities and global fixed interest
securities and equities directly (or indirectly through pooled funds).
It will be actively managed in terms
of the sector weightings to reflect
our investment outlook and aims
to generate positive returns in good
and bad times. It can hold material
levels of cash or low risk investments
when attractive investment
opportunities are scarce.
The Fund may use derivative
products, short-sell securities
and utilise leverage and active
currency management.
The key difference
between the Funds is
their investment objectives
and relative risk profiles.
>The Active Growth Fund’s objective
is to generate positive annual returns
of at least 10% (after fees and before
tax) in good and bad markets. To
achieve this the Fund is actively
managed and will usually be primarily
invested directly (or indirectly through
pooled funds) in equities in New
Zealand and global entities. However,
it can hold material levels of cash
and fixed interest securities when
attractive opportunities are scarce
and the prospect for share markets
is poor. The Fund may use derivative
products, short-sell securities and
utilise leverage and active currency
management.
Milford KiwiSaver
Conservative Fund
Milford KiwiSaver
Balanced Fund
Milford KiwiSaver
Active Growth Fund
Recommended Investment
Time Frame
At least three years
At least five years
At least five years
Investment Objective
To exceed the 90-Day Bank Bill
Index (after fees and before tax)
Capital growth over time
A return of 10% per annum
(after fees and before tax)
Investment Policy
To hold a diversified mix of yield
oriented investments, sometimes
augmented by some growth
assets. The Fund can short-sell
securities, use leverage,
utilise derivative products and
To hold a diversified investment
portfolio including New Zealand
cash, fixed interest securities
and equities and global cash,
fixed interest securities and
equities. The Fund can short-sell
securities, utilise leverage, use
derivative products and active
currency management.
To hold equities in predominately
New Zealand, Australian and
global listed entities and also
potentially equities in unlisted
entities, units in unit trusts,
cash and fixed interest securities.
The Fund can short-sell
securities, utilise leverage,
use derivative products and
19
Who are
these Funds
suitable for?
The Funds are suited to members
who want us to actively manage their
investments and make the decision
about when to increase and decrease
the exposure to equities or fixed
interest securities.
The Conservative Fund is suitable for
members who are more conservative
and/or who have a shorter investment
time frame of at least three years.
20
The Balanced Fund is suitable for
members who want to invest in our
capability to select top performing
New Zealand and global entities but
also wish to have some exposure to
investments outside of Australasia.
The Balanced and Active Growth
Funds have the flexibility to hold high
levels of equities and are therefore
appropriate for investors with
longer-term investment time frames
of at least five years.
The Active Growth Fund is suitable for
members who want access to these
selection skills but with a focus on
New Zealand and Australia.
Prospective members who feel the
need to do so should get advice on their
personal circumstances, but in general
the Milford KiwiSaver Plan Funds are
suitable for the following investor types:
Milford KiwiSaver
Conservative Fund
Milford KiwiSaver
Balanced Fund
Milford KiwiSaver
Active Growth Fund
Member age
Over 60
Over 55
Under 55
Member Goal
Members who wish to actively
manage their investment
who seek a lower level of risk
than the Active Growth and
Balanced Funds.
Members who seek long term
capital growth and who wish to
offset short term market shifts
by investing in a mix of equities,
global entities, fixed interest
securities and cash with some
exposure to investments
outside Australasia.
Members who wish to maximise
the opportunity to generate
higher rates of return through
exposure to equities in
New Zealand and global entities
with a focus on New Zealand
and Australia.
Fair and
simple fees
You should be able to see clearly both
what investments are being made on
your behalf and how much you can
expect to pay for our management.
It can equally apply to the cost of any
advice that you may receive about how
to invest. The cost of advice should be
clear and separate from the cost of
investment management – there are
no advice costs built into these Funds.
You should seek separate financial
advice if you feel that you need to do so.
Capped
management fee
Administration and Registry Fee
Performance Fee
A $36 per annum per member fee is
charged for membership of the Plan.
To incentivise Milford to perform well
in the Active Growth Fund and some
of our underlying unit trust funds a
performance fee is charged if we
exceed certain investment objectives
or targets.
Capped Management Fee
We chose to combine the investment
management, Trustee, custodial, fund
accounting, unit pricing, audit, legal and
other normal fund operating expenses
in one capped management fee.
There are no entry, exit or switching
fees in the Funds.
To the extent that assets of the Funds
are directly or indirectly invested in
the Milford range of funds, the Milford
KiwiSaver Plan Funds will be fully
rebated for the management fees
charged within those funds.
However, any performance fee
charged by us in respect of those
funds will remain payable.
Milford KiwiSaver
Conservative Fund
Milford KiwiSaver
Balanced Fund
Milford KiwiSaver
Active Growth Fund
1.05% p.a.
1.05% p.a.
1.05% p.a.
This is a capped fee, including any applicable GST, of the gross asset value of the relevant Fund excluding
any abnormal costs, brokerage or (other than for the Conservative Fund) any performance fee. The capped fee
covers our normal fund operating costs such as investment management, trustee, custodial, audit and legal
costs. The Balanced Fund usually has an allocation to global investments. Any international management or
performance fees charged by international fund managers are in addition to any Milford fees and are deducted
within each Fund.
Performance fee
None
None directly paid from the
Milford KiwiSaver Balanced
Fund, although we will potentially
receive performance fees on
any investment by the Milford
KiwiSaver Balanced Fund into the
Milford KiwiSaver Active Growth
Fund, the Global Unit Trust PIE
Fund, the Trans-Tasman Unit Trust
PIE Fund, and the Dynamic Unit
Trust PIE Fund in our capacity as
manager of those other funds.
15% of the performance of the
Milford KiwiSaver Active Growth
Fund (after deducting the capped
management fee and expenses)
above the target return of 10% per
annum is potentially payable to
us (see pages 27 to 29 for more
details).
21
INFORMATION REQUIRED BY THE SECURITIES ACT 1978
What sort
of investment
is this?
This Investment Statement offers memberships
in the Milford KiwiSaver Plan. The Plan is registered
under the KiwiSaver Act 2006.
The Plan is a pooled fund where you contribute to the
Plan over time and benefits payable depend on the amount
of contributions made either by you alone, or by you
in conjunction with your employer, plus any returns on
contributions received and any additional amounts contributed
either by or on behalf of you (such as the member tax credits).
Your money is pooled with that of other members of the
relevant Fund. However, the assets of one Fund cannot
be used to cover the liabilities of another Fund in the Plan.
The interests of members are represented by units,
which confer an equal interest in a Fund and are of equal
value. Pooling money can enable access to a wider variety
of assets and provide greater diversity than you may achieve
on your own. The value of units in each Fund in the Plan will
fluctuate according to the changing value of the underlying
assets in which the Fund has invested.
The principal purpose of the Milford KiwiSaver Plan is to
provide retirement benefits for individuals. At the date of
this Investment Statement there are three investment funds
under the Plan: the Conservative Fund, the Balanced Fund
and the Active Growth Fund. Details of these Funds
are set out on pages 16 to 21.
The Funds are managed by Milford Funds Limited and their
assets are held by the Trustee of the Plan – Trustees Executors
Limited through its nominee, T.E.A. Custodians Limited, both
of whom are independent of us. The assets of each Fund may
be invested either directly, or into managed funds, including
those offered by us.
22
KiwiSaver for employers
Employers can participate in the Plan by entering into a
Participation Agreement. For employees of those employers,
this Investment Statement will be accompanied by a
supplement setting out the detailed terms applicable
to the employer’s scheme.
The particular terms and conditions of any Participation
Agreement may include any provision for contributions by an
employer (over and above the minimum compulsory employer
contributions) to vest over time, the amount of contributions
which the employer is required to make to the Plan,
and any particular fee provisions in relation to an
employer’s participation in the Plan.
Employees of participating employers
If you are participating through an employer you are entitled to
copies of your employer’s Participation Agreement (and copies
of any amendments to that agreement) on request.
This Investment Statement should be read together
with any relevant accompanying supplement.
When you leave your employer (if it is a participating
employer), then the standard terms of membership contained
in this Investment Statement (excluding any supplement)
will apply to your membership of the Plan.
Who is involved
in providing
it for me?
The name of the Plan is the Milford KiwiSaver Plan.
You contribute to the Plan over time and the benefits
payable to you depend on the amount of contributions
made either by you alone, or by you in conjunction with
your employer, plus any returns on contributions received
and any additional amounts contributed by or on behalf
of you (such as member tax credits).
> Brian Arthur Gaynor BCom
Director, Auckland
The Plan commenced on 1 April 2010, under a trust deed
dated 19 March 2010 between us and Trustees Executors
Superannuation Limited. In September 2012, Trustees
Executors Limited replaced Trustees Executors
Superannuation Limited as Trustee.
Manager and Promoter
We, Milford Funds Limited, are the manager of the Plan.
We were incorporated in New Zealand under the Companies
Act 1993 on 3 August 2007. We are also the promoter of
the Plan in terms of the Securities Act 1978 and regulations
under the Act. At the date of this Investment Statement
our directors are:
> Richard John Somerville BCom, CA, ACIS
Chairman and Director, Wanaka
Richard is a Chartered Accountant with a 25 year
career in Investment Banking, specialising in mergers
and acquisitions. Richard was previously a Director of
Southpac Corporation Limited, Chief Executive of Lloyds
Corporate Finance Limited in Sydney and most recently
was the Chief Executive of Societe Generale’s Investment
Banking business in Australia, trading under the name of
SGHambros. Richard is a Director of a number of private
companies in the areas of wine distribution, vehicle testing
and infrastructure development. Richard is a foundation
shareholder in Milford Asset Management Limited and
has been Chairman of the board since Milford Asset
Management Limited’s formation in 2003.
Brian is Chairman of our Investment Committee and
head of Milford’s portfolio management and investment
analysis activities. Brian is one of New Zealand’s most
experienced and well-known investment analysts.
Brian’s career includes roles as a Partner and Head of
Research at stockbrokers Jarden & Co, a member
of the New Zealand Stock Exchange, Chairman of the
New Zealand Society of Investment Analysts and Chairman
of the Asian Securities Analysts Council. Brian is Portfolio
Manager of the Milford Active Growth Fund and the Milford
KiwiSaver Active Growth Fund.
> Graeme Richard Thomas BA, CFP, AFA
Director, Auckland
Graeme co-founded Milford Asset Management Limited
in 2003. Prior to this he was Head of Advisory Services at
ANZ Private Bank in New Zealand. Graeme has 29 years
experience in investment management, including the
role as Chief Investment Officer at Southpac Investment
Management. In the 15 years Graeme was at Southpac,
funds under management expanded to $3 billion with
assets sourced from pension and superannuation schemes,
trusts and private clients.
> Anthony Francis Quirk BCA (Hons), FSCAP, AFA
Director, Auckland
Anthony has more than 28 years experience in the
investment industry. He joined Milford Asset Management
Limited in 2007. As Milford Asset Management’s
Managing Director, Anthony has overall responsibility for
the company’s business activities. Anthony is a Fellow of
the Institute of Financial Professionals New Zealand and
is a current board member of that organisation. Anthony
has previously been Chairman of the Asset Management
Advisory Board of the New Zealand Exchange, member
of the Financial Reporting Standards Board of the
New Zealand Society of Accountants and Deputy Chairman
of the New Zealand Society of Investment Analysts.
23
Our Directors may change from time to time.
The current directors are listed on a public register,
and may be viewed on the Companies Office website
at www.business.govt.nz/companies by searching
“Milford Funds Limited.”
At the date of this Investment Statement Milford and
its Directors may be contacted at:
Level 17, 41 Shortland Street
PO Box 960, Shortland Street, Auckland 1140
Telephone: 09 921 4700 or 0800 662 346
Facsimile: 09 921 4709
Email: [email protected]
Our contact details may change. Current contact details can
be obtained from our website at www.milfordasset.com
We are a wholly owned subsidiary of Milford Asset
Management Limited, which is a well established investment
company that has over $2.5 billion under management
at the date of this Investment Statement. Milford Asset
Management Limited invests individual private portfolio
accounts for high net worth individuals and also manages
large wholesale investment portfolios. Milford Funds Limited
was created in 2007 to enable investors to invest with us
to gain the advantage of the investment expertise and vast
experience of our team. Neither the performance of Milford
Funds Limited, nor that of the Funds, is guaranteed by
Milford Asset Management Limited, or any other party.
Any employer (and its directors) who enters into a Participation
Agreement with us and the Trustee will also be a promoter of
the Plan in relation to membership offered to its employees.
In accordance with the terms of the Securities Act (KiwiSaver
Employer Participants) Exemption Notice 2012, information
regarding the promoters of any such plan may be disclosed in
a supplement to this Investment Statement, where relevant,
for employees of that employer who apply
for membership of the Plan.
All applications for investments in the Plan and any other
correspondence should be forwarded to:
C/- Trustees Executors Limited
PO Box 409
Wellington 6140
Custodian
Trustees Executors Limited is the custodian of the
Plan’s assets.
Trustee
The independent trustee of the Plan is Trustees
Executors Limited.
At the date of this Investment Statement the Trustee’s
principal place of business is Level 5, 10 Customhouse Quay,
Wellington and the Trustee can be contacted at:
24
Trustees Executors Limited
Level 12
45 Queen Street
PO Box 4197 Shortland Street
Auckland 1140
The Trustee’s address may change from time to time.
The current address may be obtained at www.trustees.co.nz
under “Corporate Trust” and “contact our Corporate Trust Team”.
The Trustee is responsible for supervising the performance
of our functions as the manager of the Plan. In addition, the
Trustee or a person nominated under the Trust Deed must hold
all of the assets of the Plan.
The Trustee has been granted a full licence under the Securities
Trustees and Statutory Supervisors Act 2011 to act as a
KiwiSaver Trustee. The licence expires on 16 January 2018 and
is subject to reporting conditions. Further information on the
Trustee’s licence is publicly available on the Financial Markets
Authority website (www.fma.govt.nz) and also on the
Financial Services Providers Register (www.business.govt.nz.fsp).
We have delegated certain specific administrative functions
(unit pricing, Fund accounting and registry functions) to the
securities services division of Trustees Executors Limited.
Trustees Executors Limited (whose address is set out above)
is therefore also an administration manager for the Plan.
Responsible Investment Statement
Responsible investment, including environmental,
social and governance considerations, is taken into account
in the investment policies and procedures of the Plan as at
the date of this Investment Statement. You can obtain an
explanation of the extent to which responsible investment
is taken into account in those policies and procedures
from us, free of charge, upon request.
Our responsible investment policy is to improve
New Zealand’s long-term economic well-being by taking strong
stands on corporate governance issues. Analysing whether
an entity adheres to appropriate corporate governance policies
is a key part of any research we undertake on the merits of
investing into a entity.
The corporate governance policies that we prefer
are followed include:
> a clear separation between Chairman and Chief Executive
> a demonstrated commitment to increasing entity value
for all shareholders
> a majority of independent directors
> a board that consists of highly competent and involved
directors, with a mix of skills to contribute. A strong
emphasis is placed on the commercial skills of directors
> clearly articulated and consistently followed fair remuneration
policies for senior management and the board
Our policy is to vote our proxies on all issues for all the entities
we invest in on behalf of our investors.
How much
do I pay?
Contributions for employees
You can choose to contribute to the Plan an amount equal
to either 3%, 4% or 8% of your gross salary or wages as
defined from time to time in the KiwiSaver Act. This currently
includes salary or wages from employment, including other
remuneration such as bonuses and overtime, as well as certain
other benefits.
If you do not select a rate, your contribution rate will be an
amount equal to 3% of your Gross Salary or Wages.
Your employer will deduct the contributions at the applicable
contribution rate from each payment of your after tax salary
or wages and pay them to the IRD. The IRD will then pay the
contributions (with any interest) to the Plan after an initial three
month period (if this is your first KiwiSaver scheme account).
You can change your current contribution rate to either 3%,
4% or 8% of your Gross Salary or Wages (as the case
may be) at any time by notifying your employer accordingly.
Generally, you cannot change your contribution rate at intervals
of less than three months unless your employer agrees.
You can also make additional regular or lump sum contributions
to the Plan at any time. Additional lump sum contributions
must be at least $100. If you wish to make additional regular
contributions to the Plan you must contribute at least $10 per
week. These amounts may be varied by us. These can be
paid by cheque, direct credit or direct debit. Details on how
to make payments are provided on page 43.
Employer contributions
Employers must make contributions on behalf of their
employees who are contributing to a KiwiSaver scheme
or a complying superannuation fund. To be eligible for this
compulsory employer contribution, you must be contributing
to the Plan from your salary or wages, be over 18 years of
age and must not have reached the Qualifying Date.
Your employer is required to contribute an amount equal to
3% of your Gross Salary or Wages. ‘Gross Salary or Wages’
for compulsory employer contributions purposes excludes
parental leave payments out of public money and accident
compensation payments.
An employer can cease making compulsory contributions on
your behalf if you take a contribution holiday or the IRD advises
the employer to cease contributions.
If your employer contributes to a registered superannuation
scheme for your benefit, then those employer contributions
may count towards the compulsory employer contributions
required to be made for your benefit to a KiwiSaver scheme,
provided specific criteria are met. Employer’s superannuation
contribution tax is levied on the employer contribution at your
marginal tax rate. This tax will be payable by your employer.
Direct contributions by non-employees
If you are a New Zealand citizen or permanent resident and
normally living in New Zealand and are either:
> self-employed;
> under 18; or
> between 18 and 65 and not working,
you can join the Plan by completing the application form
attached to this Investment Statement and make direct
contributions at any time by cheque, direct credit or by
completing the direct debit authority attached to this
Details of how to make payments are provided on page 43.
At the date of this Investment Statement, the minimum initial
lump sum investment by a non-employee member is $1,000,
the minimum regular contribution amount is $10 per week and
the minimum additional lump sum investment amount by a
non-employee member is $100. We may vary these amounts.
25
Government contributions
Transferring from another superannuation scheme
Kickstart Contribution
You may transfer any amount into this Plan from
any other KiwiSaver scheme or superannuation scheme.
The amount that you transfer will be credited to your
account as determined by us. No fee is currently charged
for transferring your interest in another scheme to this Plan.
If this is your first KiwiSaver scheme account, the Government
will make a contribution (Kickstart Contribution Amount) which
is currently $1,000 to the Plan for your benefit. This will be
made approximately three months after your initial contribution
if this is the first time you have joined a KiwiSaver scheme.
Member Tax Credit
If you reside mainly in New Zealand (or are otherwise an
employee of the State services serving outside New Zealand
or work overseas as a volunteer or for token payment for
certain charitable organisations) and are aged between
18 and the Qualifying Date, you will be eligible for a
Member Tax Credit while you are contributing to the Plan
(Member Tax Credit Amount).
At the date of this Investment Statement the Member Tax
Credit Amount is a contribution from the Government of
$0.50 for each $1 contributed by you, up to a maximum of
$10 a week or $521.43 a year, depending on your start date
with KiwiSaver and how much you have contributed.
See “What returns will I get?” on page 30, for the restrictions
on withdrawing your Kickstart Contribution Amount and your
Member Tax Credit Amount.
Transfer into the Plan from an Australian Superannuation Fund
You may be able to transfer into this Plan from Australian
Superannuation Funds. See the Prospectus for more details.
Transfers into the Plan from a UK pension plan
Members who transfer funds from a UK pension plan
to the Plan should note that in certain circumstances there
may be adverse UK tax consequences of a transfer to
another KiwiSaver scheme that is not a Qualifying Recognised
Overseas Pension Scheme (‘QROPS’), withdrawals of UK
Pension funds from the Plan that are over a member’s UK
‘Lifetime Allowance’ limit, or withdrawals of funds that are not
consistent with retirement savings or provision for retirement.
Members who have any concerns in this regard should
take independent financial advice from a suitably qualified
financial adviser.
26
Contribution Holiday
If contributions to the Plan are being deducted from your
Gross Salary or Wages, then under the KiwiSaver Act you
may apply to the IRD to suspend your contributions to the
Plan (a Contribution Holiday) if:
> 1
2 or more months have passed since your first
contribution was received by IRD, or since you first
contributed direct to a KiwiSaver scheme; or
> within the first 12 months you are suffering, or likely to
suffer, financial hardship (and IRD has received at least
one contribution from you).
If a Contribution Holiday is granted based on financial
hardship, its duration will be three months (unless IRD agrees
to a longer period). The duration of a Contribution Holiday will
otherwise be between three months and five years. The IRD
will notify you before your Contribution Holiday ends and you
may apply for a new Contribution Holiday.
You may resume contributing at any time by giving notice
to your employer, requiring the employer to start making
deductions from your Gross Salary or Wages. Further details
about Contribution Holidays are available from the IRD website
www.ird.govt.nz.
Ability of members to opt out if automatically enrolled
If you have been automatically enrolled in the Plan on starting
new employment, you have 56 days within which to opt out
of the Plan. Further details around opting out of the Plan are
available by contacting us.
Non-deduction notice
If you pass the End Payment Date, you may give a nondeduction notice to your employer stating that the employer
must stop deducting contributions from your Gross Salary
or Wages. From the first payment of Gross Salary or Wages
after the non-deduction notice is received, your employer
is no longer required to deduct contributions from your pay.
You may revoke the notice at any time by giving the employer a
revocation notice, but may only do so within the three months
after giving the non-deduction notice to the employer, if the
employer agrees.
What are the
charges?
The following are the charges for the Milford KiwiSaver Plan.
Under the KiwiSaver (Periodic Disclosure) Regulations 2013,
we are required to prepare and make publicly available,
quarterly and annual disclosure statements for each Fund.
In those disclosure statements, we are required to disclose
fees and costs in a particular way. As a result, care should
be taken when comparing the figures from those disclosure
statements and this Investment Statement.
Entry/exit fee
There are no entry or exit fees charged to you.
Member administration and registry fee
We have appointed the securities services division of Trustees
Executors Limited to perform the member administration and
registry services for the Plan. Trustees Executors Limited is
entitled to be reimbursed from the members account for the
day-to-day administration of member accounts and maintaining
the member registry for the Plan. This fee is currently $3.00 per
month per member and is paid monthly. GST is payable on the
administration fee if it arises, but no GST is currently payable.
Management fee
We are entitled to be paid fees, based on the gross asset value
of each respective Fund within the Plan, for the investment
services that we provide to the Plan as well
as for trustee, custodial, audit and other fund expenses.
Each management fee is calculated daily and paid to us
each month, and deducted from unit prices.
As at the date of this Investment Statement, the annual
management fee paid from the assets of:
> The Active Growth Fund and the Balanced Fund is
1.05% of the gross asset value of the applicable Fund
(excluding abnormal costs, brokerage, the member
administration and registry fee and any performance fee).
This amount is inclusive of GST at the basis for charging
GST, as at the date of this Investment Statement.
> The Conservative Fund is 1.05% per annum of the gross
asset value of that Fund (excluding abnormal costs,
brokerage and the member administration and registry
fee). This amount is inclusive of GST at the basis for
charging GST, as at the date of this Investment Statement.
The method of paying such fees will be determined by us
from time to time and notified to the Trustee in writing.
We are also entitled under the Trust Deed to be reimbursed
for costs incurred in discharging our obligations as manager,
but as noted above have capped these within the management
fees described above (excluding the member administration
and registry fee and any abnormal costs, brokerage or any
performance fee). The capped fees cover normal Fund
operating costs such as investment management,
Trustee, custodial, fund accounting, audit and legal costs.
As at the date of this Investment Statement:
> the Active Growth Fund invests into the Milford Active
Growth Wholesale Fund;
> the Balanced Fund invests into the Active Growth Fund,
the Trans-Tasman Unit Trust PIE Fund, the Global Unit Trust
Pie Fund, the Dynamic Unit Trust Pie Fund and the Milford
Income Wholesale Fund; and
> the Conservative Fund invests into the Milford Income
Wholesale Fund, and can also invest into other Milford
wholesale and retail funds.
To the extent that assets of the Funds are invested in the
Milford range of funds, the Milford KiwiSaver Plan Funds will
be fully rebated for any management fees charged by Milford
within those funds, although any performance fee charged
by us in respect of those funds will remain payable by the
Milford KiwiSaver Plan Funds. Refer to page 28 and 29 for
more details.
27
Trustee’s annual fee
Performance fees payable to Milford
The Trustee is entitled to receive fees for trusteeship services.
This fee will be calculated daily and paid to the Trustee each
month by us out of our capped management fee for the Funds.
Active Growth Fund
Custodial fund accounting and unit pricing fees
We have appointed the securities services division of
Trustees Executors Limited to perform certain administration
and securities services for the Plan (including unit pricing,
Fund accounting and other services as may be agreed from
time to time) and Trustees Executors Limited is entitled to
receive a fee for performing those services. That fee will
be calculated daily and paid each month by us out of our
capped management fee of 1.05% per annum for each of the
Funds. The Trustee nominated Trustees Executors Limited as
custodian of the Plan’s assets.
28
As manager of the Active Growth Fund, we are entitled
to be paid a performance fee from the Fund. Neither of the
other Funds directly charge a performance fee. However,
in relation to the Balanced Fund, we will potentially receive
performance fees on investments made into the Milford
KiwiSaver Active Growth Fund, the Trans-Tasman Unit Trust
PIE Fund, the Global Unit Trust PIE Fund and the Dynamic Unit
Trust PIE Fund. Also, international managers into which the
Funds invest may charge a performance fee which is deducted
within that fund. The table below summarises the Active
Growth Fund performance fee.
Element
Description
Application to the Active Growth Fund
Return objective
This describes what the Fund is trying to achieve
The Active Growth Fund aims to generate positive annual
returns of at least 10% (after fees and before tax and the
performance fee), in good and bad markets. For more
information, see the investment objective and policy of
the Fund on page 19 of this Investment Statement
Hurdle rate of return
The return that must be achieved before
a performance fee applies
Positive annual return of at least 10% (after fees and
before tax and before the performance fee)
Fee on excess return
The amount of the return above the hurdle rate of
return that is payable
The performance fee is equal to 15% of the amount by
which the performance of the Fund (after the deduction
of the capped management fee but before tax and the
performance fee) exceeds the hurdle rate of return
Performance fee cap
A cap (if any) on the amount of the performance fee
There is no cap on the level of performance fees
High water mark
Where the value of the Fund goes up and then
down over multiple periods, this ensures that no
performance fee is payable if we have previously
been rewarded for that performance
For a performance fee to be payable in any particular
period, the net asset value per unit of the Fund
(before tax and the performance fee) must exceed that
Fund’s net asset value per unit used in the calculation
of the last performance fee paid
Fee frequency
How often the performance fee is paid
Annually (intended at the date of this Investment
Statement to be 31 March)
Fee payable to
Who the performance fee is paid to
In addition:
Expenses
> Performance fees are paid within 10 business days
of the end of the relevant period (unless changed by
agreement between us and the Trustee).
Under the Trust Deed we and the Trustee are entitled to be
reimbursed from the assets of the Plan for all expenses
incurred in connection with operating the Plan, and the
acquisition of or dealing with investments.
> The high water mark cannot be reset.
> The performance fee is calculated and accrued daily.
> You can ascertain the level of the performance fee
paid to us from the Fund by referring to the financial
statements for the Plan.
Underlying funds
As described previously, at the date of this Investment
Statement, a Fund may invest into another Fund or other unit
trusts of which Milford is also the manager (Other Milford
Funds). In those situations the relevant Fund will be fully
rebated for any management fees charged by those Other
Milford Funds (to ensure there is no “double-dipping”
of management fees by us). However, those rebates do
not extend to any performance fees charged by the Other
Milford Funds (where applicable).
Accordingly, at the date of this Investment Statement,
whilst we are not paid a performance fee direct from the
Balanced Fund, indirectly that Fund is subject to performance
fees arising at the level of the underlying funds into which it
invests because:
> the Active Growth Fund (into which the Balanced Fund
invests) charges a performance fee (as described
previously); and
> the Milford Trans-Tasman Unit Trust PIE Fund, the Milford
Global Unit Trust PIE Fund and the Milford Dynamic Unit
Trust PIE Fund (into which the Balanced Fund invests)
charge a performance fee. As manager of the Milford Unit
Trust PIE Funds, Milford is entitled to be paid a performance
fee from those funds in respect of each six-month period
(intended at the date of this Investment Statement to be 31
March and 30 September). Details of that performance fee
are set out in the prospectuses and Investment Statement
for the Milford Unit Trust PIE Funds.
Subject to the KiwiSaver Act, the Trustee is also entitled to
be reimbursed from the assets of the Plan for costs incurred
by it in discharging its obligations as Trustee under the terms of
the Trust Deed.
As noted previously, we have limited the payment of expenses
(excluding the Member administration and registry fee and
any abnormal costs, brokerage or any performance fee) to
a capped annual management fee based on the gross asset
value of the relevant Funds.
Abnormal, one-off or extraordinary costs incurred are not
covered by the capped management fee and may be charged
to the relevant Fund following consultation with the Trustee.
To date, no Fund has incurred any abnormal, one-off or
extraordinary costs.
The financial statements for the Plan will incorporate the fees
payable to us which are intended to cover the normal operating
costs of each Fund. This fee will affect returns to you.
The Plan may be charged fees and expenses for investing in
funds issued or managed by investment managers (other than
us) selected by us. These fees and expenses may affect your
returns and will be reflected in unit prices from those funds.
No fees will be charged for switching your Plan entitlements
between the Funds.
Changes to fees
We may change existing fees or impose new fees on giving
written notice to you and in accordance with the Trust Deed.
There is currently no intention to do so. Although there is
no limit to the amount to which a fee can be amended,
under the KiwiSaver Act all fees and expenses charged to
you must be reasonable. You can apply to the Court for an
order that an unreasonable fee be annulled or reduced.
Any such application must be made within one year of
the day that the fee is imposed or debited.
29
What returns
will I get?
Returns to you are in the form of benefit payments on withdrawal
from the Plan. Subject to the KiwiSaver Act, your Plan entitlement
will be the value of your units in the Plan less any uninvested
employer contributions (if any) and any further amount that the
Trustee considers appropriate to deduct with respect to costs,
expenses, fees or tax payable under the Trust Deed.
Benefit payments to you will be in the form of a lump sum or,
where you elect, regular instalments (subject to withdrawal
requirements set out below), obtained by withdrawing units
either when, or after, you have reached the Qualifying Date.
You may also receive a benefit payment before the Qualifying
Date if your withdrawal is permitted under the KiwiSaver
Scheme Rules.
We have the legal obligation to pay benefits in accordance
with the Plan’s Trust Deed. The Trustee is responsible for
determining whether benefits are payable if you make an
application for a withdrawal on the basis of significant financial
hardship or serious illness. We are responsible for determining
whether benefits are payable in any other case. We are
responsible for arranging for the payment of benefits to or
in respect of members, and for transfers to other KiwiSaver
schemes or foreign superannuation schemes.
In some cases, your Member Tax Credit Amount cannot be
withdrawn from the Plan. Additionally, you cannot withdraw
your Member Tax Credit Amount:
> b
efore you (or your personal representative where
necessary) give the Trustee a statutory declaration stating
the periods for which you have had your principal place of
residence in New Zealand; or
> t o the extent to which we or the Trustee have notice that
your claim for the Member Tax Credit Amount is wrong,
because the periods during which you met that residency
requirement were wrongly advised.
Qualifying Date withdrawal
We may defer payment of a Permitted Withdrawal in certain
circumstances. For more details see “How do I cash in
my investment?”
Once you have reached the Qualifying Date you may withdraw
some or all of your entitlement from the Plan at any time.
You may choose to defer such payment or receive regular
instalments, subject to a minimum withdrawal amount of $100
and a limit of 12 withdrawals per year. You may also choose to
withdraw the total lump sum of your balance.
Home purchase
Subject to conditions under the KiwiSaver Scheme Rules
from time to time, you can make a withdrawal to purchase
your first home (or a subsequent home for previous home
owners who no longer have a share in a property and who
Housing New Zealand determines are in the same financial
position as a first time home buyer) and may be eligible for
a first home deposit subsidy, once three years or more have
passed since:
> the IRD received your first KiwiSaver contributions; or
> you first joined a KiwiSaver scheme (if you have only
made direct contributions to the Plan).
If you have been a member of more than one KiwiSaver
scheme, then the combined membership will count towards
the three-year period. Please note, you can only be a member
of one KiwiSaver scheme at a time.
You may not make a withdrawal for the purpose of purchasing
a first home if you have already previously made a withdrawal
from the Plan or another KiwiSaver scheme for this purpose.
The amount withdrawn:
> must be used to purchase a home that will be your principal
place of residence; and
> excludes the Kickstart Contribution Amount and any
Member Tax Credit Amount.
30
You will remain a member of the Plan and, if you are an
employee, you must continue contributing to the Plan
unless you have taken a Contribution Holiday.
If you are part of an employer plan within the Plan, then your
employer’s supplement to this Investment Statement will
detail whether your employer’s vested contributions (that are
not compulsory employer contributions) can be withdrawn
for a first home purchase, and (if so) whether there are any
restrictions in that regard.
A first home deposit subsidy is available to members who
satisfy certain conditions. To be eligible:
> you must have contributed to a KiwiSaver scheme or
complying superannuation scheme for at least three
years; and
> be buying a first home; and
> be planning to live in the house for at least six months.
If you have owned a home before you may still be eligible for
the first home deposit subsidy. Housing New Zealand will
need to determine if you are in the same financial position as
a first home buyer. For the purpose of determining whether
you are a first home buyer, current or previous ownership of
a leasehold estate in land is disregarded.
Currently, the subsidy is a Crown contribution of $1,000 for
each year of contributions (subject to a minimum of three
years’ contributions) up to a maximum of $5,000 per member.
You will need to complete a withdrawal request form
(and, in the case of a withdrawal for Significant Financial
Hardship, a statutory declaration of your assets and liabilities).
By law, the Trustee may request evidence to support your
withdrawal request (this may include medical evidence).
Permanent emigration
Except in relation to Australia, you may apply to us to withdraw
from the Plan after one year has passed since you permanently
emigrated from New Zealand. Your Member Tax Credit Amount
cannot be withdrawn, and will be repaid to the IRD.
Except in relation to Australia, you may also request us to
transfer your full Plan entitlement (less your Member Tax
Credit Amount) to a foreign superannuation scheme authorised
for that purpose by regulations under the KiwiSaver Act (at the
date of Investment Statement no such regulations have been
made).
To apply to withdraw your KiwiSaver savings on the grounds
of permanent emigration you will need to provide a completed
statutory declaration and other documentary evidence.
If you permanently emigrate to Australia:
> you will not be able to withdraw any retirement savings
in cash prior to the End Payment Date; but
You may only receive the first home deposit subsidy once.
> you will be able to transfer all of your KiwiSaver benefit
(including any Member Tax Credit Amount) to an Australian
complying superannuation scheme (transfers of partial
amounts will not be permitted).
The first home deposit subsidy will be administered by Housing
New Zealand Corporation. Income and house price caps apply
For more information please visit www.hnzc.govt.nz.
Any amount transferred from a KiwiSaver scheme to an
Australian complying superannuation scheme will not then
be able to be transferred to a third country.
Death
On death, your full Plan entitlement will be paid to your
personal representatives (the administrators or executors of
your estate). Small balances held (currently less than $15,000)
can be paid directly to a surviving partner or caregiver.
Significant Financial Hardship and Serious Illness
Under the terms of the KiwiSaver Act, you may be permitted
to withdraw some or all of your Plan entitlement if either:
The facility for transferring to an Australian complying
superannuation scheme (and the related post-transfer third
country restrictions) came into force from 1 July 2013.
A member who has permanently emigrated from Australia
to New Zealand may choose to transfer his or her Australian
superannuation savings to the Plan. Where his or her
Australian superannuation savings are transferred to the Plan,
the member:
> the Trustee is reasonably satisfied that you are suffering or
are likely to suffer from Significant Financial Hardship; or
> will generally be able to start withdrawing his or her
Australian-sourced savings once he or she has turned
60 and has retired for the purposes of Australian
superannuation legislation;
> the Trustee is reasonably satisfied that you are suffering
from Serious Illness.
> will not be able to withdraw any Australian-sourced savings
for the purpose of purchasing a first home; and
The terms ‘Significant Financial Hardship’ and ‘Serious Illness’
are defined in the KiwiSaver Scheme Rules.
> will not be able to withdraw any Australian-sourced savings
on permanent emigration if he or she subsequently
permanently emigrates from New Zealand to a country
other than Australia.
Such withdrawal may exclude some or all of the Kickstart
Contribution Amount and the Member Tax Credit Amount,
depending on the type of withdrawal.
31
Transfer to another KiwiSaver scheme
Key factors that determine the amount of your benefit
You can only be a member of one KiwiSaver scheme at a time.
If you choose to transfer to another KiwiSaver scheme then you
must transfer your full Plan entitlement (including the Kickstart
Contribution Amount and the Member Tax Credit Amount).
The amount transferred will exclude (if applicable) any
uninvested contributions from your employer. Although unlikely,
you may be asked to transfer to another KiwiSaver scheme –
if so, the IRD will provide you with information on options.
Apart from the amount of contributions you make,
the key factors determining the returns you will get from
your investment into the Plan are:
Switching funds
You are able to choose to switch some or all of your existing
Plan entitlements between the Funds. You can also split your
KiwiSaver contributions between the Funds. This is currently
known as the Consolidated Option.
Withdrawals required by law
The Trustee must comply with the provisions of any enactment
or order of any Court (such as under a property sharing order
under the Property Relationships Act 1976)
that requires a member to pay some or all of their Plan
entitlement (in accordance with that enactment or order).
Taxation (Annual Rates, Foreign Superannuation,
and Remedial Matters) Bill
The recently introduced Taxation (Annual Rates, Foreign
Superannuation, and Remedial Matters) Bill proposes changes
to the tax treatment of interests in foreign superannuation
schemes held by New Zealand residents, and to money
from foreign superannuation schemes that is repatriated to
New Zealand. The changes are subject to consultation and
are intended to apply from 1 April 2014.
If enacted, a tax liability may be triggered when you repatriate
money from a foreign superannuation scheme (other than from
Australia) to New Zealand. Also included is an amendment
to the KiwiSaver Act to expand the category of permitted
withdrawals. That would allow individuals who transfer money
from foreign superannuation schemes
(other than from Australia) into a KiwiSaver scheme the
option to apply to the scheme to withdraw funds to pay
any tax liability that will be triggered by that transfer.
You should seek independent advice as to how the proposed
changes will affect the tax treatment of any interests you
hold in foreign superannuation schemes and any transfers
of money from such schemes. You should also seek
independent advice as to whether a withdrawal in these
circumstances is permitted under the terms of your foreign
superannuation scheme.
32
(a)the investment performance of the Fund which you
have selected for your contributions to be invested
(which may be positive or negative);
(b) the amount of other contributions, including by employers
(if any) and any Member Tax Credit Amounts paid;
(c) the amount of the fees referred to in the section
“What are the charges?”; and
(d) taxation applicable to the Plan – refer to the Taxation
section that follows.
No amount of return on your investment can be promised or
guaranteed. The value of your investment (measured through
the unit price) will fluctuate upwards and downwards as the
value of the underlying investments change.
Returns (i.e. withdrawals) are not paid on any particular date
or any particular frequency. They depend on your eligibility to
withdraw and your own personal circumstances.
Taxation
Returns to you will be affected by tax laws which may be
subject to change. This section briefly summarises relevant
taxation laws current at the date of this Investment Statement.
It is intended as a general guide only and, as members have
different personal situations, your tax obligations will differ –
you are therefore encouraged to seek your own tax advice
before investing. Further details in relation to the taxation of
KiwiSaver and PIEs can be obtained from the IRD website
www.ird.govt.nz.
The Plan is a Portfolio Investment Entity (‘PIE’) and a multirate PIE as defined in the Income Tax Act 2007. The tax regime
applicable to a PIE provides that all taxable income, losses and
tax credits related to the Plan’s investments must be allocated
to you in proportion to your daily Unit holdings in the Plan,
with tax payable at your Prescribed Investor Rate (‘PIR’).
Under the PIE tax legislation, the Plan will calculate and
pay tax on the net income it allocates to members at the
following PIRs.
At the date of this Investment Statement an individual
member who is a New Zealand resident will have a PIR
of 10.5%, 17.5% or 28%.
To qualify for a 10.5% or 17.5% PIR, you must be a
New Zealand resident for tax purposes, must supply a
valid IRD number to us and must meet the following criteria
in relation to either of the previous two income years.
Income years generally commence on 1 April in any year
and end on 31 March in the following year.
If the taxable
income is
And taxable income
plus PIE income of
Then the PIR
that applies is
$0 - $14,000
$0 - $48,000
10.5%
$0 - $48,000
$0 - $70,000
17.5%
$48,001 and over
$70,001 and over
28%
Individual members who do not qualify for a 10.5% or
17.5% PIR (including non-residents) will have a PIR of 28%.
You must provide your IRD number, your applicable PIR and
other details to us on your application. Each year we will
request you to confirm your PIR.
The tax payable by the Plan on the net income allocated to you
for any given period will depend on the net income allocated
to you for that period and your PIR. We will cancel Units to
address the difference in PIRs between members. If there are
excess tax credits for a period, or the Plan has a loss rather
than net income for a period, the Plan should receive a tax
credit and will be able to issue additional Units to members
on account of that credit.
If you make a full withdrawal or transfer from the Plan,
any tax liability on the Plan’s net income attributable to your
investment will be deducted from the balance withdrawn
or transferred. A partial withdrawal will be deemed to be
a full withdrawal if the Units left are insufficient in value to
cover the accrued tax liability, and an amount will be deducted
(by cancelling some of your Units) on account of the accrued
tax liability. We will deduct the tax on the net income attributed
to the remaining members during April each year, also by
cancelling Units.
A switch between Funds is regarded as a withdrawal from
one Fund and an acquisition of a new investment in another
Fund. Where you provide an investment instruction to us or
the Trustee to switch all of your investment in a Fund, we will
calculate any tax at the time of the switch and will deduct
any tax payable from, or add any refund to, the amount that
is switched between Funds.
If you have provided us with the correct PIR, the tax paid on
income allocated to you by the Plan will be a final tax. You will
not need to include the income allocated to you in a tax return.
There will also be no impact on family assistance eligibility,
student loan repayment obligations or child support payment
obligations. You must notify us if your PIR changes or if you
cease to be a New Zealand resident. If you don’t, you will
be personally liable to pay any resulting tax shortfall and will
generally be required to file a tax return.
If you have provided us with a PIR that is higher than your
correct PIR the IRD will not refund you the difference.
The IRD can instruct us to apply a different PIR to the one
notified by you.
For more information on PIRs please refer to the IRD
website: www.ird.govt.nz.
Generally, gains or losses made by the Plan on the sale of
equities in New Zealand resident companies or Australian
resident listed companies (on an Australian Securities
Exchange approved index) will not be taxable or deductible.
The Plan will pay tax on any dividends received from
those equities.
Foreign equities (other than equities in Australian resident
companies as noted above) will generally be taxed under
the FDR method - the Plan will be taxed on 5% of the market
value of such global equities calculated on a daily basis.
Foreign equities offering guaranteed or fixed rate returns
will be taxed under the comparative value method
(i.e. annual change in market value plus distributions).
Taxation legislation and rates of tax change. You should
always seek independent professional tax advice on your
own personal circumstances.
While the assets and liabilities of a Fund are treated separately
from the assets and liabilities of each other Fund in the Plan,
the Plan itself is treated as a single taxpayer. Subject to the
tax rules for PIEs, the Trust Deed for the Plan allows us,
in consultation with the Trustee, to make a payment from one
Fund to another Fund to accommodate the Plan, and the Funds
within the Plan, being a single taxpayer.
Where you provide an investment instruction to switch only
some (and not all) of your investment in a Fund no tax will
be deducted or refunded at that time unless the Units left
are insufficient in value to cover the accrued tax liability and
an amount will be deducted (by cancelling some of your
Units on account of accrued tax liability).
33
What are
my risks?
All investments carry
some level of risk
Personnel and management risks
The main risks you face are:
> Staffing risk: Our ability to provide investment management
services to a Fund is linked to key professionals whose
departure could impact on the performance of the Fund.
The performance of investments will depend on the quality
of management of a Fund, the investment process and
that Fund’s assets.
> You may not receive the returns you expect
> The capital value of your investments may end
up less than you originally thought
> You may not be able to get your money back
when you need it.
Before investing, you should carefully consider the following
risk factors which may affect returns and your ability to recover
money invested in a Fund.
We think your principal risks can be classified under three
main headings:
> Personnel and management risk
Personnel and management risk relates to us and addresses
risks around the way we manage the Funds. These risks
will consequently be different for other fund managers.
> Fund risk
These risks relate to the Fund or Funds you choose to
invest in because of the nature of the underlying assets
of each Fund (and the proportion of such assets within
the Fund). As a result each Fund has a different risk profile.
> General risks
General risks relate to investment funds, and the
investment industry, as a whole, and will usually affect
you in a similar way whether you choose to invest in
one or more of our Funds, or one or more funds of
another fund manager.
34
At the date of this Investment Statement, the main personnel
and management risks that apply are:
> Service provider risk: You could be adversely affected
if any of the various parties involved in the operation of
a Fund, including the Trustee, us, or other underlying
administration managers and other underlying investment
managers fail to perform their obligations.
> Borrowing risk: A Fund could invest in an underlying fund
that may have the ability to borrow. Such borrowing may
increase the volatility of the return that can be expected
from that Fund.
Fund risks
At the date of this Investment Statement, the main risks that
apply to the Funds are:
Main risks affecting securities in the Funds
Milford KiwiSaver
Conservative Fund
Market
risk
Entity
risk
Interest
rate risk
Milford KiwiSaver
Balanced Fund
Market
risk
Entity
risk
Currency
risk
Milford KiwiSaver
Active Growth Fund
Market
risk
Entity
risk
Currency
risk
These risks and other risks that apply are described in more
detail as follows:
> Market risk: Returns on a Fund will be affected by the
performance of the investments chosen for that Fund
which may be affected by the performance of the
investment markets generally. This risk, related to market
performance, includes movements in the general price
level, demand and supply in the market in which the
relevant investments are made, the sectors in which
the investments are made, and economic and regulatory
conditions, including market sentiment, inflation,
interest rates, employment, political events, environmental
and technological issues, and consumer demand in
New Zealand, Australia and globally.
> Entity risk: An investment of a Fund in an entity may be
affected by unexpected changes in that entity’s operations
or business environment, or the entity may become insolvent.
> Currency risk: Where underlying investments are invested
in jurisdictions outside of New Zealand, the returns will be
affected by movements between the other currencies and
the New Zealand dollar. Global transactions may be unhedged.
> Interest rate risk: This refers to the risk that the market
value of the securities in a Fund can change due to
changes in interest rates. The market value of fixed income
securities can fluctuate significantly with relatively small
changes in interest rates. The sensitivity depends on the
starting level of interest rates, the maturity date of the
security and level of coupon or dividend paid.
> Liquidity risk: Some investments may not be easily
converted into cash with little or no loss of capital and
minimum delay, because of inadequate market depth,
suspension of trading on request from the market regulator
or the entity involved, or disruptions in the market place.
Securities of small entities in particular may, from time to
time and especially in falling markets, become less liquid.
> Counterparty risk: A counterparty to a contract may fail
to meet their obligations under it, causing loss to a Fund.
This potentially arises with various securities including
derivatives and fixed interest.
> Derivative risk: Because we may use derivative instruments
such as futures and options, the investment movements
may be more volatile than if a Fund is invested solely in
equities.
> Emerging markets risk: If a Fund invests in emerging
market securities, there may be a greater risk of price
fluctuation or of the suspension of redemptions in such
funds, compared to funds investing in more mature markets.
This volatility may stem from political and economic factors
and be exacerbated by legal, trading liquidity, settlement,
transfer of securities and currency factors.
> PIE status risk: If the Plan loses its status as a PIE then
the Plan will be taxed as a widely-held superannuation fund
rather than under the PIE regime (and the tax treatment
of members in the Plan will differ accordingly).
> Valuation risk: A Fund may invest in unquoted and/or
illiquid investments which have a risk of mispricing.
In such situations an objective, verifiable source of
market value may not be available.
> Small and medium sized entities risk: There are risks
associated with investing in small and medium sized
entities as the prices of securities associated with such
entities is usually more volatile (compared to those of
larger entities), and the securities are generally less liquid.
General risks
At the date of this Investment Statement, the main general
risks that apply are:
> Performance risk: Past performance is no guarantee
of future performance. There is a risk that in the future
a Fund will not achieve its investment objectives.
> Equity risk: The risk that an investment will depreciate
because of stock market dynamics causing the investment
to lose value.
> Regulatory risk: Returns may be affected by any adverse
regulatory changes in New Zealand or other global
jurisdictions, which could have an impact on investments.
> Country concentration risk: Funds which invest in
essentially only one country will have greater exposure
to market, political, legal, economic and social risks of that
country than a fund which diversifies country risk across a
number of countries. There is a risk that a particular country
may impose foreign exchange and/or conversion controls or
regulate in such a way as to disrupt the way the markets in
that country operate.
> Taxation risk: Changes in taxation rates or tax rules may
impact investment returns. The taxation assumptions
used in this Investment Statement are based on existing
New Zealand tax legislation. Any changes to such
legislation may materially impact the returns of a Fund.
It is recommended that you seek advice from a tax adviser
before making an investment into a Fund.
The above risks are not exhaustive.
Because of the risks set out above, it is foreseeable that
you may receive back less than you invest into a Fund.
In any event, you will not be required to pay more money
than the amount you invest into a Fund.
35
How we manage (mitigate) risks
Consequences of insolvency
The risks above are common to the investment industry
and will impact on the Funds to varying degrees.
You have no liability to any person should we or a Fund
become insolvent. In no event will you have to pay any
money in addition to the amount you have invested.
As a general comment, to earn a higher return in the long
term, a member must be required to accept higher risk
(i.e. there is a risk and return relationship).
We will monitor and evaluate risk to endeavour to deliver the
required return for the risk taken on by members in the Funds.
Note that it is not possible to fully eliminate risk from our
investment Funds.
Despite that, we actively take steps to address risk and to
minimise it where possible. Techniques we use include:
> Engaging and utilising the knowledge and experience
of our investment team to manage our Funds effectively
and efficiently.
> Thoroughly researching and appraising potential companies
and entities before committing a Fund to invest in that
company or entity.
> Actively managing the selection of investments.
> Monitoring changes in the global and local economic
environment and how this will impact on our clients’
investments.
> Where appropriate, diversifying the investments to ensure
that we are not exposed in any one class of investments.
> Ongoing monitoring of each investment to ensure it is
performing to our expectations.
36
If a Fund is wound up, members in that Fund will receive a
proportionate share of assets of that Fund after all creditors’
expenses including, without limitation, the expenses of any
agents, solicitors, auditors or persons employed in connection
with the winding up of that Fund and any outstanding fees
(including remuneration payable to us and the Trustee) have
been paid. The claims of members will rank equally.
No guarantee by Government
There is no guarantee provided by the Government in respect
of the Plan or any Fund (nor does the Government guarantee
any other KiwiSaver scheme or investment product of a
KiwiSaver scheme).
No other guarantee
None of us, Milford Asset Management Limited, the Trustee,
or any of our respective directors and employees, guarantee
the securities offered in this Investment Statement
including the repayment of any capital invested or the
payment of any earnings or returns on any capital
invested in the Plan).
Can the investment
be altered?
Membership details
Changes to your membership details may be made by
writing to:
PO Box 409
Wellington 6140
Contributions
You can change your current contribution rate to either 3%,
4% or 8% of your Gross Salary or Wages (as the case may be)
at any time by notifying your employer accordingly.
However, unless your employer agrees otherwise, you cannot
change your contribution rate at intervals that are less than
three months apart.
The new contribution rate will apply to the next salary or
wage payment after your employer receives that instruction.
You are entitled to take a Contribution Holiday if your
contributions are made by deduction from salary or wages,
by applying to the IRD after you have been contributing for
at least 12 months, or if you are suffering financial hardship.
Should this be relevant to you, either your employer or we
can provide you with more information.
Subject to any minimum additional investment amount you can
make additional contributions at any time and from time
to time. For more information see the section headed
“How much do I pay?”on page 25.
Switching Funds
You can choose to switch your existing Plan entitlements
between the Funds. Refer to the ‘Taxation’ section set out
under the heading, “What returns will I get?” on page 30 for
details of the tax consequences of switching. At the date
of this Investment Statement no charges are payable for
switching between the Funds.
Amendments to the Trust Deed
The Trust Deed can be altered by us and the Trustee.
Amendments to the Trust Deed must comply with the
KiwiSaver Act.
These restrictions on amendments to the Trust Deed also
extend to any amendments to an employer’s Participation
Agreement (as the provisions of that Agreement comprise
part of the Trust Deed).
We may retire as manager of the Plan by giving the Trustee
at least 90 days prior written notice and appointing a new
manager who is independent of the Trustee. We may be
removed as manager of the Plan if the Trustee obtains an order
of the High Court requiring our removal.
The Trustee may apply for such an order if the Trustee is
satisfied that:
> there is a significant risk that your interests will be
materially prejudiced; or
> the provisions of the Trust Deed are no longer adequate
to give proper protection to you.
The Trustee must give reasonable notice to us of its intention to
apply to the High Court for an order to remove us as manager of
the Plan, including notifying us of its reasons for seeking the order.
From the effective date of retirement or removal, we shall
be discharged from our obligations and duties under the Trust
Deed (other than duties and obligations incurred before the
effective date of retirement or removal). We must procure
the appointment of a replacement manager for the Plan from
the effective date of our retirement or removal as manager of
the Plan. Any such replacement manager must be a company
within the meaning of the Companies Act 1993 and must
have at least one director who is a New Zealand resident.
In addition, a replacement manager must be independent
from the Trustee as required by the KiwiSaver Act.
Winding up the Plan
The Plan can be wound up in certain circumstances.
See “How do I cash in my investment?”on page 38.
Changes to fees
We and the Trustee may alter any fees as described under
“What are the charges?” (page 27) or impose new fees by
giving notice to you and the Trustee in accordance with the
Trust Deed. As at the date of this Investment Statement,
there is no intention to do so. Although there is no limit to the
amount to which a fee can be amended, under the KiwiSaver
Act all fees and expenses charged to you by certain parties
(e.g. us and the Trustee) must be reasonable. You can apply
to the Court for an order that an unreasonable fee be annulled
or reduced. Any such application must be made within one
year of the day that the fee is imposed or debited.
Changes to investment objectives and policy of the Funds
We may review and revise the investment objectives and
policy of a Fund. Any such revision shall be notified to you
as at the date the revision takes effect.
Change in legislation
The KiwiSaver and PIE regimes are offered under relatively
new legislation, certain aspects of which, such as the required
contribution rate and the circumstances in which benefits may
be withdrawn and the types of transactions that are taxed,
are prescribed by law and may change from time to time.
This may impact on your membership of the Plan.
37
How do I cash in
my investment?
Withdrawals
Assignment or transfer of your interest in the Plan
You can make a request for a withdrawal by writing to:
You are not permitted to sell, assign or transfer your interest
in the Plan to another person, unless required by the KiwiSaver
Act or the provisions of any enactment.
PO Box 409
Wellington 6140
Please confirm the basis for your withdrawal and provide any
additional material needed to support your application.
Withdrawals from the Plan can be made in the circumstances
set out under the heading “What returns will I get?” on page
30. Refer to the “Taxation” section on page 32 for details of
the tax consequences of withdrawals.
We may defer payment of a Permitted Withdrawal where,
due to certain circumstances arising (for example, political
or market conditions), we form the opinion that it is not
practicable, or would be materially prejudicial to members,
for such withdrawals to be made.
Withdrawal requests are irrevocable. Payment will be made
to your nominated bank account.
There are, at the date of this Investment Statement,
no exit fees payable on withdrawal.
38
Winding up the Plan
The Plan can be wound up if:
> we notify the Trustee in writing that the Plan is to be
wound up; or
> t he Trustee is of the opinion that the Plan is or will be
unable to fulfil its purpose, the Plan ceases to have any
beneficiaries, or the winding up of the Plan is otherwise
required by law, and the Trustee resolves that the Plan
should be wound up; or
> if the Financial Markets Authority (‘FMA’) directs.
On winding up, the Trustee will transfer your Plan entitlement
(less any expenses and claims of creditors) to another
KiwiSaver scheme of your choice. If you do not choose a
scheme and your employer does not have a chosen KiwiSaver
scheme, your Plan entitlement will be transferred to a default
KiwiSaver scheme assigned by the IRD.
Who do I contact
with inquiries about
my investment?
If you have any inquiries about the Plan, please write to us:
PO Box 960, Shortland Street
Auckland 1140
Attention: Client Services.
Telephone: 09 921 4700 or 0800 662 346
For general inquiries or to find out the value of your
Plan entitlement you can call us on (09) 921 4700
or 0800 662 346 during normal business hours,
email us at [email protected] or visit the
Milford website at www.milfordasset.com.
Should you contact us (or the Trustee) please
provide your Plan membership number.
39
Is there anyone to
whom I can complain
if I have problems with
the investment?
In the first instance, please direct any complaints about your
investment to us at:
Auckland 1140
Attn: Client Services
Telephone: 09 921 4700 or 0800 662 346
If we are unable to resolve your complaint, you may choose
to contact the Trustee at:
Level 12, 45 Queen Street
Auckland 1140
Attn: Business Manager - Corporate Trust
Telephone: 09 308 7100
We are a member of the Insurance and Savings Ombudsman
Scheme (‘ISO’) and the Trustee is a member of Financial
Services Complaints Limited (‘FSCL’) both of which are
independent dispute resolution schemes approved by the
Ministry of Consumer Affairs.
If you have made a complaint to us and the complaint cannot
be resolved, then you may refer it to the ISO subject to
certain conditions being met.
Office of ISO
PO Box 10-845
Wellington 6143
Telephone: 04 499 7612 or 0800 808 200
Further information about referring a complaint to the ISO
can be found at www.iombudsman.org.nz.
40
If you have made a complaint to the Trustee, and it has not
been resolved within 40 days or if you are dissatisfied with
the proposed resolution, you can refer it to FSCL at:
4th Floor, 101 Lambton Quay, Wellington
PO Box 5967, Lambton Quay
Wellington 6145
Telephone: 04 472FSCL (472 3725) or 0800 347 257
Further information about referring a complaint to FSCL
can be found at www.fscl.org.nz.
Note that different procedures apply when making a
complaint to the ISO and FSCL. Full details can be obtained
at their respective websites.
If you have a complaint that the Plan is not being operated
in accordance with the KiwiSaver Act, or that the financial
position of the Plan, or the security of the Plan’s entitlements,
or the management of the Plan is inadequate, you can
complain to:
Financial Markets Authority
Level 2, 1 Grey Street
56 The Terrace
PO Box 1079
Wellington 6140
Telephone: 04 472 9830
Website: www.fma.govt.nz
What other
information
can I obtain about
this investment?
Further information about the Plan, us and the Trustee can
be found in the Trust Deed, the registered prospectus,
and the financial statements of the Plan. These documents
will be available for inspection, without fee during normal
business hours, at:
Auckland 1140
Telephone: 09 921 4700 or 0800 662 346
Website: www.milfordasset.com
You can also obtain copies of the prospectus and the most
recent financial statements of the Plan free of charge on
request in writing, or by telephone, to us.
The Trust Deed, prospectus, financial statements of us and
the Plan and other documents of, or relating to the Plan,
are filed (in accordance with the statutory requirements as
to timeframes) on the public register at the Companies Office.
Copies of certain documents may be viewed (if available) on
the Companies Office website at www.companies.govt.nz.
In accordance with the requirements of the KiwiSaver (Periodic
Disclosure) Regulations 2013 we are required to prepare an
annual report (as at 31 March each year) and quarterly reports
(as at 31 March, 30 June, 30 September and 31 December
each year). Those reports, when available under timeframes
set out by the regulations will be posted on our website.
Alternatively you may request a copy, free of charge, by
contacting us.
Annual information
Each year, you will be sent a copy of the Plan’s annual report,
including the Plan’s summary financial statements, an auditor’s
report in respect of those summary financial statements and
a summary of amendments made to the Trust Deed since the
date of the last annual report (if any).
We will also send you an annual personalised statement
showing the amount of each type of contribution received by
the Plan during the year and your member’s accumulation at
the end of the Plan year.
Additional information
You will receive at least annually a confirmation of receipt of
any contributions made directly to the Plan (i.e. not via the
IRD). You may request on-line access to your Fund or you may
request from us, at the address shown earlier in this section,
free of charge:
> a copy of the current unit prices (also available on
our website);
> your member account history; and
> a statement showing an estimate of your Plan entitlements
in accordance with the requirements of the Securities
Act 1978.
41
Considering
your Risk Profile
These short questions will help you understand your attitude towards investment risk and help you decide which option may suit
your needs. This is important because your attitude to risk is one of the main factors when deciding how to invest your money.
Remember these questions are intended as a guide only and we strongly recommend you seek professional investment advice
from an authorised financial adviser to help you plan for your future.
Age
1. When do you plan to draw on your investment?
Points
My Score
5
10
20
Short term (1-3 years)
Medium term (3-10 years)
Long term (more than 10 years)
Risk tolerance
2. If your investments were to decline in value by 20% over a 12 month period, what would you do?
Points
My Score
5
10
15
20
Transfer the entire investment to a more secure option
Transfer some (say half) of the investment to a more secure option
Do nothing
Invest more to take advantage of the lower prices
Investment experience
3. How would you best describe your investment experience?
Points
My Score
15
10
5
I am an experienced investor
I take an interest but I’m not really comfortable making investment decisions myself
I am not familiar with investment markers and have little interest in their workings
Investment decisions
4. What would you do with a $100,000 windfall that had to be invested? Put it all in the share market
Put most in the share market and the rest in a more secure investment such as a term deposit
Invest in a property (which includes paying off the mortgage)
Put most in a more secure investment and the rest in the share market or a similar higher risk investment
Put it all in the bank or on term deposit
Points
My Score
25
20
15
10
5
Total Score
Your total score indicates the investment fund you may wish to consider
42
Your score
Profile
Investment funds available
20 to 30
Cash
No Milford Funds
31 to 40
Conservative
Milford Conservative Fund
41 to 50
Moderate
Milford Balanced Fund
51+
Growth
Milford Active Growth Fund
This is a tool to assist you to determine the investment
option that may best suit your risk profile. This is not an
investment or financial plan and should be treated as a guide
only. We recommend that you discuss your investment options
with your professional adviser prior to making any choices.
Neither we nor the Trustee accepts any responsibility for the
investment option you choose or for the performance of your
investment.
This risk-profiling tool was sourced from Aon Saver Limited.
How to join
the Milford
KiwiSaver Plan
If you are a new KiwiSaver member you will need to:
1. Read this Investment Statement.
2. Complete the Application Form on pages 45 and 46
of this Investment Statement.
3. Enclose a certified copy of one form of identification
such as a passport (refer pages 46 and 47).
4. If you are employed you should let your employer know
you have enrolled with the Milford KiwiSaver Plan. If you
are not an employee then an initial investment is required
for the minimum $1,000 investor contribution amount
made out to: Milford KiwiSaver Plan or direct credited to the
following bank account: 02 0500 0966274 000 in the name
of: Milford KiwiSaver Plan. Please reference this payment
with your name and IRD number.
5. Mail documentation to:
c/- Trustees Executors Limited
PO Box 409
Wellington 6140
If you are an existing KiwiSaver investor and want to switch
from your existing provider, you will need to:
1. Read this Investment Statement.
2. Enclose a copy of one form of identification such as
a passport (refer pages 46 and 47).
3. Complete the application form on pages 45 and 46
of this Investment Statement:
Mail documentation to:
c/- Trustees Executors Limited
PO Box 409
Wellington 6140
Once the Trustee has received your application you will
receive a confirmation letter. If you are switching from another
KiwiSaver provider, we will contact your previous KiwiSaver
provider to have your KiwiSaver savings transferred. Note that
it can take up to 35 days for the transfer to be completed.
Ongoing contributions after you have joined.
1.Contributions for employees are detailed on pages 25
and 26. In summary, contributions will be made by the
employee, employer and the Government. Employees
can also make irregular or regular voluntary additional
contributions, the latter can be made by completing the
direct debit form on page 48.
2.Contributions for self-employed, unemployed or those
under 18 are detailed on pages 25 and 26. Once a nonemployee is a member of the Plan, contributions can be
made to the Milford KiwiSaver Plan’s trust account by
internet banking as a payment to: 02 0500 0966274 000
or by sending a cheque to the Milford KiwiSaver Plan to the
address detailed previously. Please provide your surname
and Milford KiwiSaver Plan investor number or IRD number
with any payment. Regular contributions can be made by
completing the direct debit form on page 48.
Investing for Children
If the child is under 16, all parents/legal guardians are required
to sign the application.
If the child is 16 or 17, the child must co-sign the application
together with one of his/her parents/legal guardians.
An IRD number is also required to process the application.
Where the child’s birth certificate is not used as their
identification, please include the birth certificate with
the application also.
43
Application Form
Direct Debit Form
Please complete all sections of the Application Form
on pages 45 to 46.
This is for Milford KiwiSaver Plan members who wish to make
regular contributions to their KiwiSaver account. For those who
are self-employed, not employed or under 18, direct debit is
one of the ways to make a contribution. Other options are
to make contributions via internet banking or via a cheque
(as detailed on the previous page). For employees the direct
debit form can be used to make voluntary contributions
over and above the contributions already made via salary,
employer and Government contributions.
To ensure your details are recorded correctly, please:
> Print, using ball point pen.
> Use capital letters.
> If an item is not applicable please leave the designated
area unmarked.
> If you make a mistake simply draw a line through the
mistake and initial the change, do not use correcting fluid.
> If there is not enough space please use any available
space in the margins.
> Make sure you sign the Application Form.
Identification
Under the Anti-Money Laundering and Countering Financing
of Terrorism Act 2009, we have to verify the identity of people
who apply to join the Plan. See the application form for
more information.
If sufficient identification is not provided in situations where
it is required then your application will be rejected.
Prescribed Investor Rate
You will need to notify us of your PIR. For details on which
PIR to choose, please see the ‘Taxation section’ on pages
32 and 33.
44
Please contact us on (09) 921 4700 or 0800 662 346 or visit
Milford’s website: www.milfordasset.com if you have any
problems or questions about filling in the application or direct
debit forms or have any queries once you become a member
of the Milford KiwiSaver Plan.
To look at answers to questions relating to KiwiSaver in
general or specifically on the Milford KiwiSaver Plan you
can also visit the following websites:
> the Milford website:
> the Government KiwiSaver website:
www.kiwisaver.govt.nz
> the Commission for Financial Literacy and Retirement
Income website: www.sorted.org.nz
OFFICE USE ONLY:
/
/
DATE
ADVISER’S STAMP
Application or Transfer Form for the Milford KiwiSaver Plan
This is an application to invest in the Milford KiwiSaver Plan. Please mail this form, together with your certified identification and cheque (if a non-employee) and any
other relevant documentation to:
Milford KiwiSaver Plan, c/- Trustees Executors Limited, PO Box 409, Wellington 6140
INVESTOR DETAILS
INVESTOR NAME
TITLE
SURNAME
DATE OF BIRTH
IRD NUMBER
FIRST NAMES
EVIDENCE OF IDENTITY PROVIDED
Additional evidence is required - please refer to identity verification overleaf
Prescribed Investor Rate (Please tick appropriate box)
10.5%
17.5%
28%
Refer to page 32 of this Investment Statement to determine your applicable rate. If an elected tax rate is not selected, 28% will apply.
CONTACT DETAILS
POSTAL ADDRESS
POSTCODE
MOBILE
BUSINESS PHONE
HOME PHONE
EMAIL ADDRESS
FAX
If you are employed
If you are employed your regular contributions will be made by your employer. If you wish to invest an additional amount directly, please contact Milford.
Elected Contribution Rate (as a percentage of your gross wages or salary)
3%
4%
8%
EMPLOYER DETAILS
COMPANY NAME
POSTAL ADDRESS
POSTCODE
PAYROLL EMAIL ADDRESS (if known)
BUSINESS PHONE
EMPLOYERS IRD NUMBER (if known)
If you are not employed and not a member of an existing KiwiSaver Scheme
If you are not employed (self-employed, under 18, retired, etc) then please complete the amount of your initial investment. The minimum initial investor contribution
is: $1,000 (excluding any Government contribution). If you are transferring a balance you do not need to invest this initial contribution.
Please make the cheque payable to ‘Milford KiwiSaver Plan’. Or direct credit to
02 0500 0966274 000 in the name of Milford KiwiSaver Plan.
Initial Investment
INVESTMENT DETAILS
The Milford KiwiSaver Plan offers the option of investing your contributions in either the Active Growth Fund, and/or the Balanced Fund,
and/or the Conservative Fund. If you wish to invest in only one of the Funds tick one of the boxes below.
Conservative Fund
Balanced Fund
Active Growth Fund
CONSOLIDATED OPTION
If you wish to split your contributions please indicate the percentage you wish to have allocated to each Fund ensuring the percentages add to 100%. In the event
of an error in completing this part of the application form, Milford has discretion to allocate you to the Milford Conservative Fund.
Conservative Fund
Balanced Fund
Active Growth Fund
Transfer from current KiwiSaver scheme. This is a transfer from:
Name of Scheme
I apply to transfer my benefit from the above scheme to the Milford KiwiSaver Plan. I authorise the manager or the trustee of the transferring scheme to provide to
Milford or the Trustee of the Milford KiwiSaver Plan any of my personal information as necessary to complete the transfer of my benefits to the Milford KiwiSaver
Plan. Please note if you wish to transfer a non-KiwiSaver Superannuation Fund to your KiwiSaver account, please contact Milford directly.
45
IDENTITY VERIFICATION
The Anti-Money Laundering and Countering Financing of Terrorism Act 2009 requires Milford to verify the identity of new investors in new situations. The following
sets out the suitable forms of identification at the date of this Investment Statement. These may change from time to time and accordingly additional or alternative
requirements may be introduced during the period of the offer (including any requirements to comply with the Foreign Account Tax Compliance Act (FATCA)). You
agree to provide any additional information reasonably requested by us.
Please provide a certified copy by a trusted referee, of one of the following (see page 47 for details):
A certified copy of identification
New Zealand Driver Licence; or
New Zealand Passport/Citizenship document (signed); or
Firearms licence (signed)
If you are not a New Zealand citizen, you need to provide the identification documents stated above, as well as proof of your Resident status.
PLUS certified address verification (dated within last 3 months) showing your name and address
Bank statement; or
Utility bill (i.e. Sky, electricity, water); or
A New Zealand Government Department letter (i.e. IRD).
Investing on behalf of a minor we require certified copies of the birth certificate of the minor and identity documentation for the guardians as per above.
New Zealand birth certificate of the minor
Identity documentation for the guardians as per above
Do you already have an investment with Milford?
Yes
No
THE PRIVACY ACT 1993
This statement relates to the personal information that you are providing to Milford Funds Limited by way of this application and any subsequent personal
information which you may provide in the future. The personal information you have supplied may be used by Milford and the Trustee (and related entities thereof)
for the purposes of enabling Milford to arrange and manage your investment, and to contact you in relation to your investment. Milford will provide you (on request)
with the name and address of any entity to which information has been disclosed. You have the right to access all personal information held about you by Milford. If
any of the information is incorrect, you have the right to have it corrected. You acknowledge that you are authorised to provide personal information on behalf of the
applicant and evidence of this authority is provided (in the case of a parent/guardian/other providing information about the applicant). You agree that your/each of your
names and addresses may be used by Milford Funds Limited to provide you with newsletters and other information about the fund and other products and services.
EMAIL USE
I consent to receiving financial statements, and other documents which the Trustee or Milford are required or elect to send to me, electronically at the email address on this
form, or other email address advised to Milford. If no email address is supplied, financial statements and other documents which the Trustee or Milford are required to send
to me will be mailed to my postal address.
DECLARATION
I have read and retained a copy of the attached Investment Statement dated 6 December 2013 for the Milford KiwiSaver Plan and agree to be bound by the terms
and conditions of the Trust Deed. I agree to the terms outlined above in relation to the Privacy Act and the supply of personal information. I understand that the
Milford KiwiSaver Plan is a vehicle for long-term investment and as the Plan invests in equities, the value of my investment is liable to fluctuations and may rise and
fall from time to time. I understand the manner in which the fees will be deducted from my investment.
I understand that investments in the Milford KiwiSaver Plan are subject to investment risk, including possible delays in repayment and loss of income and capital
invested. I understand that neither Milford nor any other person guarantees the repayment of capital from the Milford KiwiSaver Plan.
SIGNATURE OF APPLICANT (if 16 years or older)
DATE
If signing as a parent/guardian, I confirm (and supply documentation) that I am a legal guardian of the applicant. I confirm that I have read and accepted the
‘Declaration’ above, on behalf of the applicant.
MINORS
If the application is being made for someone under the age of 16, all of the applicant’s parents or legal guardians must also sign below. If the application
is being made for someone who is 16 or 17, the applicant must sign together with one of the applicant’s parents or legal guardians.
FULL NAME OF PARENT/GUARDIAN (if applicant under 18)*
SIGNATURE OF PARENT /GUARDIAN DATE
FULL NAME OF SECOND PARENT/GUARDIAN (if applicant under 16)* SIGNATURE OF SECOND PARENT/GUARDIAN DATE
* Please note that as indicated above, if signing as a parent or legal guardian you must verify your own as well as the applicant’s identity (refer to page 47 for
further information).
46
Milford KiwiSaver Plan - Application Form Checklist
Use this checklist in accordance with the Milford KiwiSaver Plan Investment Statement to ensure you have correctly
completed your application form.
Name and date of birth (make sure these match your identification)
IRD number (make sure this is in your personal name)
Prescribed Investor Rate (see page 32 of the Investment Statement for help identifying this)
Contact details (ensure your address has postal delivery and provide an email address if you want future login access)
Employer details (if applicable and not all fields are required to be completed if you do not know the information)
Initial investment (this is only for those who are non-earners, not transferring a balance, and new to KiwiSaver)
Investment details (please pages 16 – 21 of the Investment Statement for more information)
Name of the scheme you are transferring from (if applicable)
Identification documents certified by a trusted referee (see Document Certification below)
Certified Identification and address please ensure this is one of the following:
• New Zealand Driver Licence
• New Zealand Passport
• New Zealand Firearms Licence
Certified Address Verification (please ensure this is one of the following which has been issued in the last three months)
• Bank statement from a registered bank
• Utility bill
• New Zealand Government Department Letter
Signature and date
For those aged 16 to 18 years:
Guardian signature (one guardian’s signature required in addition to the KiwiSaver member)
Certified Identification (please provide ID for the KiwiSaver member, signing guardian and proof of guardianship.
Acceptable ID for a minor includes a birth certificate or passport.)
For children below 16 years of age:
Both guardian signatures
Certified Identification (please provide ID for the KiwiSaver member, signing guardians and proof of guardianship.
Acceptable ID for a minor includes a birth certificate or passport.)
If you have any queries please phone 0800 662 346 or email [email protected]
DOCUMENT CERTIFICATION
A trusted referee must be at least 16 years of age and one of the following:
• Commonwealth representative
• An employee of the Police
who holds the office of constable
• Justice of the peace
•
•
•
•
Registered medical doctor
Registered teacher
Minister of religion
Lawyer
•
•
•
•
Notary public
New Zealand Honorary consul
Member of Parliament
Chartered accountant
In addition, the trusted referee must not be:
•
•
•
•
Related to the customer; for example, a trusted referee cannot be their parent, child, brother, sister, aunt, uncle or cousin
The spouse or partner of the customer
A person who lives at the same address as the customer
A fellow Trustee
The trusted referee must sight the original documentary identification, and make a statement to the effect that the documents
provided are a true copy and represent the identity of the named individual (link to the presenter).
Certification must include:
• The name,
• Occupation and signature of the trusted referee, and
• The date of certification.
Certification must have been carried out within three months prior to presentation of the copied documents.
We may be in contact for additional information in the future if this is required to comply with legislation.
47
If you are employed, you do not need to complete this form as your salary
contributions to KiwiSaver will be added to your account automatically.
If you are transferring your KiwiSaver account to Milford and have a Direct Debit authority
set up with your current provider you will need to complete the below Milford KiwiSaver
Plan Direct Debit Authority to continue regular payments into your KiwiSaver account.
ADVISER’S STAMP
Direct Debit Authority for the Milford KiwiSaver Plan
INVESTOR INSTRUCTIONS
INVESTOR NAME
TITLE
SURNAME
FIRST NAMES
DIRECT DEBIT START DATE (required) DIRECT DEBIT AMOUNT (minimum $10) DIRECT DEBIT FREQUENCY
WEEKLY
FORTNIGHTLY
MONTHLY (please tick one)
I have read and retained a copy of the attached Milford KiwiSaver Plan Investment Statement dated 6 December 2013 and agree to be
bound by the terms and conditions of the Trust Deed.
BANK INSTRUCTIONS
Name of Bank Account from which payments are to be made:
AUTHORITY TO ACCEPT
DIRECT DEBITS
(Not to operate as an
assignment or agreement)
Bank Account Number from which payments are to be made:
AUTHORISATION CODE
BANK
BRANCH
ACCOUNT NUMBER
SUFFIX
0 2 2 0 2 2 4
(Please attach an encoded deposit slip or a copy of your bank statement to ensure your number is loaded correctly)
BANK
BRANCH
TOWN/CITY
I authorise you, until further notice in writing, to debit my account with all amounts which T.E.A. Custodians o/a Milford KiwiSaver Plan
(hereinafter referred to as the Initiator) the registered Initiator of the above Authorisation Code, may initiate by Direct Debit.
I acknowledge and accept that the bank accepts this authority only upon the conditions listed on page 49.
Information to appear on Investors bank account statement
PAYER PARTICULARS
PAYER CODE (IRD or KiwiSaver member number) PAYER REFERENCE
YOUR SIGNATURE(S)
APPROVED:
2022
0 3
48
1 0
DATE
For Bank Use Only
ORIGINAL - RETAIN AT BRANCH
DATE RECEIVED:
RECORDED BY:
CHECKED BY:
BANK STAMP
Conditions of the Direct Debit Authority
1. The Initiator:
(a) Regular Fixed Amounts
The Initiator undertakes to give written notice to the Acceptor of the commencement date, frequency and amount
at least 10 calendar days before the first Direct Debit is drawn, (but not more than 2 calendar months). In the event
of any subsequent change to the frequency or amount of the regular Direct Debits, the Initiator has agreed to give
written notice at least 30 days before the change comes into effect.
Where the Direct Debit system is used for the collection of payments which are regular as to frequency, but variable
as to amounts, the Initiator undertakes to provide the Acceptor with a schedule detailing each payment amount and
each payment date.
(b)May, upon the relationship which gave rise to this Authority being terminated, give notice to the Bank that no
further Direct Debits are to be initiated under the Authority. Upon receipt of such notice the Bank may terminate this
Authority as to future payments by notice in writing to me.
2
The Customer may:
(a)At any time, terminate this Authority as to future payments by giving written notice of termination to the Bank and
to the Initiator.
(b)Stop payment of any Direct Debit to be initiated under this Authority by the Initiator by giving written notice to the
Bank prior to the Direct Debit being paid by the Bank.
(c)Where a variation to the amount agreed between the Initiator and the Customer from time to time to be direct debited
has been made without notice being given in terms of clause 1(a) above, request the Bank to reverse or alter any such
Direct Debit initiated by the Initiator by debiting the amount of the reversal or alteration of a Direct Debit back to the
Initiator through the Initiator’s Bank provided such request is made not more than 120 days from the date when the
Direct Debit was debited to my/our account.
3
The Customer acknowledges that:
(a)This Authority will remain in full force and effect in respect of all Direct Debits made from my account in good faith
notwithstanding my debt, bankruptcy or other revocation of this Authority until actual notice of such event is received
by the Bank.
(b)In any event this Authority is subject to any arrangement now or hereafter existing between me and the Bank in relation
to my account.
(c)Any dispute as to the correctness or validity of an amount debited to my account shall not be the concern of the Bank
except insofar as the Direct Debit has not been paid in accordance with this Authority. Any other disputes lie between
me and the Initiator.
(d) The Bank accepts no responsibility or liability for the accuracy of information about payments on Bank Statements.
(e) The Bank is not responsible for, or under any liability in respect of:
- any variations between notices given by the Initiator and the amounts of Direct Debits;
- the Initiator’s failure to give written advance notice correctly nor for the non‑receipt or late receipt of notice by me for
any reason whatsoever. In any such situation the dispute lies between me and the Initiator.
(f)Notice given by the Initiator in terms of clause 1(a) to the debtor responsible for the payment shall be effective.
Any communication necessary because the debtor responsible for the payments is a person other than me is a matter
between me and the debtor concerned.
4
The Bank may:
(a)In its absolute discretion conclusively determine the order of priority of payment by it of any monies pursuant to this
or any other Authority, cheque or draft properly executed by me and given to or drawn on the Bank.
(b) At any time terminate this Authority as to future payments by notice in writing to me.
(c) Charge its current fees for this service in force from time to time.
49
Glossary
Active Growth Fund is the Milford KiwiSaver Active
Growth Fund (previously known as the Milford Aggressive
KiwiSaver Fund).
Balanced Fund is the Milford KiwiSaver Balanced Fund.
Cash is funds on call at a registered bank or short term bank
deposits (generally less than seven days).
Conservative Fund is the Milford KiwiSaver Conservative Fund.
Derivatives include currency exchange contracts, interest rate
swaps, warrants, sharemarket index futures, commodity futures,
share options and similar financial instruments.
End Payment Date, which is the later of the age of eligibility
for New Zealand superannuation (currently 65 as at the date
of this Investment Statement); and the date on which you
have been a member of one or more KiwiSaver schemes or
Complying Superannuation Funds for a period of 5 years.
Fixed interest securities (also known as bonds) are securities
issued by a borrower for which the investor usually gets a regular
interest payment and an expected return of capital.
FMA means the Financial Markets Authority.
Fund or Funds is the Active Growth Fund, the Balanced Fund
and the Conservative Fund.
Global means all the countries of the world.
Member Tax Credit Amount is the credit (if any) payable
in respect of your contributions to the Plan.
Milford, we, us or our means Milford Funds Limited.
Other Milford Fund means any other fund managed by us,
including the Milford Unit Trust PIE Funds and the Milford
Wholesale Funds.
Participation Agreement means the agreement under which an
employer participates in the Plan.
Permitted Withdrawal means a withdrawal from the Plan
allowed under the KiwiSaver Act and/or the Trust Deed.
PIE is Portfolio Investment Entity (see the Taxation Section
page 32 for more details).
PIR is the Prescribed Investor Rate (see the Taxation Section
page 32 for more details).
Plan is the Milford KiwiSaver Plan.
Qualifying Date means the later of when a member reaches
the qualifying age for New Zealand Superannuation (currently 65)
or has been a member of one or more KiwiSaver schemes and
complying superannuation funds for a period of five years.
Government means the New Zealand government.
Short Selling means selling securities you do not own with
the intention of purchasing them later at a lower price.
Gross Salary or Wages means gross salary or wages as
defined from time to time in the KiwiSaver Act.
Trust Deed is the consolidated trust deed for the Plan dated
19 September 2012.
GST means goods and services tax.
Trustee is Trustees Executors Limited.
IRD means the Inland Revenue Department.
Units means the units into which the Funds are divided and
which represent your beneficial interest in a Fund.
Kickstart Contribution Amount means the one-off $1,000
contribution the Government will make to your first KiwiSaver
scheme account for you.
KiwiSaver Act means the KiwiSaver Act 2006.
50
KiwiSaver Scheme Rules means the rules applying to the
Plan under Schedule 1 of the KiwiSaver Act.
Directory
Manager
Trustee
Auckland 1140
Telephone: 09 921 4700 or 0800 662 346
Website: www.milfordasset.com
Level 12
45 Queen Street
PO Box 4197 Shortland Street
Auckland 1140
Directors of Milford Funds Limited
Richard John Somerville
Brian Arthur Gaynor
Graeme Richard Thomas
Anthony Francis Quirk
Solicitor for the Manager
Minter Ellison Rudd Watts
Level 20 Lumley Centre
88 Shortland Street
Auckland 1010
Auditor
PricewaterhouseCoopers
188 Quay Street
Private Bag 92162
Auckland 1142
Custodian
Level 5
10 Customhouse Quay
PO Box 409
Wellington 6140
Registrar
Level 5
10 Customhouse Quay
PO Box 409
Wellington 6140
Solicitor for the Trustee
DLA Phillips Fox
50-64 Customhouse Quay
PO Box 2791
Wellington 6140
51
Notes
52
PO Box 960, Shortland Street,
Auckland 1140, New Zealand
Telephone:09 921 4700
Toll Free: 0800 662 346

- Milford Asset

Transcription

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