[PDF] Super Scoop 2001 - QSuper - Queensland Government

Any way you look at it,
you benefit from low fees
QSuper prides itself on being one of the lowest cost funds in Australia.
By keeping fees low, more of your money is working to finance your future!
What does
this mean for your
money?
Average of QSuper
competitors
Assumed 5% 5%
return
minus 1.69% 0.32%
Management
Expense Ratio
(MER)
Your money 3.31% 4.68%
grows by
The QSuper Board of Trustees
recently commissioned an independent
report, by consultants Towers
Perrin, to investigate how low
QSuper’s fees were compared to other
funds. The report found that QSuper
provides excellent value to members.
In the past, the QSuper Board of
Trustees set the fees to be charged
for administration and investment
up to 0.35% p.a. For the 2000/2001
year, fees for QSuper members were
0.264% p.a. The returns members
receive are determined after this
fee and a taxation provision are
deducted daily. Balanced with
Reserves members also have a
provision deducted from investment
earnings to fund the investment
reserve. A member with funds in
the VPP (closed) option pays an
additional 0.35% p.a. for the capital
guarantee provided.
Defined Benefit accounts (including
State and Police accounts) provide a
benefit based on a multiple of salary
calculation, so fees and investment
returns don’t directly affect your
end benefit. A crediting rate, which
has a fee deducted for management,
insurance and tax expenses, is applied
to the contributions that you pay into
your account.
Another way of looking at fees is to
use a Management Expense Ratio
(MER). You may have seen MERs
referred to in superannuation or
investment fund documents, or seen
an adviser use MERs to compare
funds. An MER is one way to measure
the total cost of your investment, and
includes manage-ment, trustee and
other expenses such as custody fees
and audit fees that are incurred by all
investment managers when investing
funds. These costs are not generally
included in the administration and
investment fees stated, but rather
reflected in the declared return. It
allows you to compare the fees of
different funds using a consistent
formula, which has been developed by
the Investment and Financial Services
Association. In future, QSuper will
also be using MERs to advise fees
charged so you can more easily
compare our fees with other funds.
When Towers Perrin compared
QSuper’s fees calculated on an MER
basis, they found that QSuper’s MERs
are “well below those charged by
retail and master funds”, and
represent “a significant benefit to
members”. This means more of
your money is working to finance
your future.
•
The following table shows just how low QSuper’s fees were over the 2000/2001 year compared to the alternatives.
CASH CASH PLUS BALANCED HIGH GROWTH
WITH RESERVES
AND BALANCED
QSuper MER 0.28% 0.30% 0.32% 0.41%
Average competing funds* 1.22% 1.41% 1.69% 1.71%
Highest competing funds 1.85% 1.85% 2.12% 2.26%
Lowest competing funds 0.75% 1.20% 1.40% 1.20%
* Retail funds; fees charged as a percentage of assets per annum.
12
SUPERSCOOP
QSuper 2001 Annual report to members