The Investment Bonds (‘Funds’ or ‘Benefit Funds’) offered under this Product Disclosure Statement (PDS)are investment products issued by Australian Unity Investment Bonds Limited (AUIBL) ABN 83 087 649 072, AFS Licence No. 234456. AUIBL takes full responsibility for this PDS.
AUIBL is a wholly owned subsidiary of Australian Unity Limited (AUL) ABN 23 087 648 888 and is a member of the Australian Unity Group of companies. However, AULis not an issuer of this PDS.
Monies invested in the Funds offered under this PDSdo not represent investments in, or liabilities of, any member of the Australian Unity Group. You should be aware that investments in benefit funds carry risks including possible delays in repayment and loss of income and principal invested. An outline of some of the risks is contained in this PDS.
Neither AUIBL, AUL, any appointed investment manager nor any member of the Australian Unity Group guarantees the performance of the Funds offered under this PDS, nor any return of capital other than as disclosed in this PDS.
This PDS contains some general investment advice. Itdoes not take into account your individual objectives, financial situation or needs and you should consider the appropriateness of the advice to you (taking into account your individual objectives, financial situation and needs). You should seek your own financial advice from an appropriately licensed adviser or an authorised representative before investing.
In this PDS, a reference to, ‘Australian Unity’, ‘we’, ‘us’ and ‘our’ is a reference to AUIBL. A reference to ‘Australian Unity Investments’ is a reference to AUIBL,Australian Unity Funds Management Limited, Australian Unity Property Limited, Australian Unity Finance Limited and Australian Unity Retirement Living Investments Limited collectively.
This PDS is available in electronic format, including access via our website. If this PDS is received electronically, you should ensure that the complete Application Form and PDS have been received. If you are unsure whether the electronic document you have received is complete, please contact us. A printed copy is available free of charge.
This document can only be used by investors receiving it (electronically or otherwise) in Australia. In this PDS,all amounts are expressed in Australian dollars unless otherwise indicated.
No investments will be accepted on the basis of this document once it is replaced with a later PDS.
The Funds offered under this PDS and the respective Schedules of the Constitution of AUIBL are:
Australian Unity Capital Guaranteed Bond – Schedule 1(‘AUI Capital Guaranteed Bond’)
Australian Unity Capital Guaranteed Mortgage Bond – Schedule 2 (‘AUI Capital Guaranteed Mortgage Bond’)
Australian Unity Conservative Growth Bond – Schedule 3 (‘AUI Conservative Growth Bond’)
Australian Unity Balanced Growth Bond – Schedule 3(‘AUI Balanced Growth Bond’)
Australian Unity High Growth Bond – Schedule 3(‘AUI High Growth Bond’)
1 AUSTRALIAN UNITY INVESTMENTS
Key Features AUI Capital Guaranteed Bond AUI Capital Guaranteed Mortgage Bond
Investment objective To provide investors with a higher after-tax return than an equivalent investment in cash deposits over the medium term, with the added security of a ‘Capital Guarantee’.
To provide investors with a higher after-tax return than an equivalent investment in cash deposits over the medium term, with the added security of a ‘Capital Guarantee’.
Investment strategy The Fund invests primarily in quality fixed interest securities, mortgages, and cash securities.
The Fund primarily invests in a portfolio of loans secured over quality retail, commercial, investment residential and industrial property. The Fund may also invest in other income producing assets.
Indicative risk level Low Low
Suggested investment timeframe At least 3 years At least 3 years
Minimum initial investment $1,000 $1,000
Minimum additional investments $500 $500
Minimum Regular Savings Plan $100 per month $100 per month
Minimum balance $500 $500
Minimum withdrawal $1,000 $1,000
Withdrawal period Generally within 5 business days Generally within 5 business days
Contribution fee Upfront contribution fee optionUp to 3% of each contribution.
Deferred contribution fee optionA policy fee of 0.75% per annum of the average balance in your account payable for 3 years. Exit fees apply under the Deferred Contribution Fee option (please refer to pages 15 to 17 for further details).
Upfront contribution fee optionUp to 3% of each contribution.
Deferred contribution fee optionA policy fee of 0.75% per annum of the average balance in your account payable for 3 years. Exit fees apply under the Deferred Contribution Fee option (please refer to pages 15 to 17 for further details).
Management costs 1.50% per annum 1.50% per annum
Buy/Sell spread Nil Nil
A SNAPSHOT
To make an informed decision please take the time to read the whole Product Disclosure Statement.
AUSTRALIAN UNITY INVESTMENTS 2
AUI Conservative Growth Bond AUI Balanced Growth Bond AUI High Growth Bond
To provide investors with stable growth returns over the medium term.
To provide investors with solid growth returns over the medium to long term.
To provide investors with strong growth returns over the long term.
The Fund invests in a diversified investment portfolio, with the majority of assets in quality fixed interest securities, mortgages and cash securities. The Fund maintains a modest exposure to growth assets such as Australian and international shares and property securities.
The Fund invests in a diversified investment portfolio, with the majority of assets in Australian and international shares and property securities. The Fund maintains a modest exposure to quality fixed interest securities, mortgages, property and cash securities.
The Fund primarily invests in Australian and international shares, with a small allocation to cash securities.
Low to medium Medium High
At least 3 years At least 5 years At least 5 years
$1,000 $1,000 $1,000
$500 $500 $500
$100 per month $100 per month $100 per month
$500 $500 $500
$1,000 $1,000 $1,000
Generally within 5 business days Generally within 5 business days Generally within 5 business days
Upfront contribution fee optionUp to 4% of each contribution.
Deferred contribution fee optionA policy fee of 0.75% per annum of the average balance in your account payable for 3 years. Exit fees apply under the Deferred Contribution Fee option (please refer to pages 15 to 17 for further details).
Upfront contribution fee optionUp to 4% of each contribution.
Deferred contribution fee optionA policy fee of 0.75% per annum of the average balance in your account payable for 3 years. Exit fees apply under the Deferred Contribution Fee option (please refer to pages 15 to 17 for further details).
Upfront contribution fee optionUp to 4% of each contribution.
Deferred contribution fee optionA policy fee of 0.75% per annum of the average balance in your account payable for 3 years. Exit fees apply under the Deferred Contribution Fee option (please refer to pages 15 to 17 for further details).
1.65% per annum 1.85% per annum 1.95% per annum
Nil Nil Nil
3 AUSTRALIAN UNITY INVESTMENTS
Who we are
Australian Unity Investments (AUI) is a specialist fund
manager. We create and source unique investment
opportunities that have the potential to deliver better
returns.
Our approach to investment is simple. We believe that in
an increasingly crowded market the best way to add value
is to provide distinctive products. In taking an approach
that’s different we have witnessed our funds under
management double since 2003 and currently manage in
excess of $3.5 billion.
Our passion is innovative investment. Traditionally
recognised for our quality mortgage and direct property
investments, our desire to source other appealing
investment opportunities has resulted in our expansion
to other investment areas. In addition to managing
significant mortgage and property portfolios we also
partner with talented boutique managers, each specialists
in their respective asset class. These asset classes include
Australian fixed interest, Australian equities, Australian
microcaps and international equities.
Our approach is based on the philosophy that size is often
not an indication of organisational expertise. We believe
that by managing money directly and with boutique
managers we maintain our focus on bringing unique
products to market while the investment managers can
focus on their core area of expertise – investing.
About Investment Bonds
Investment Bonds (also known as 10 year bonds) are
generally considered longer term investment vehicles
offering tax efficiency.
An investment bond can be capital guaranteed (investing
in cash and conservative style investments) or unit-linked
(where investors’ funds are pooled together in order to
provide individuals with access to investment opportunities
that may not otherwise be available to them).
Today’s tax system makes investment bonds a tax-
effective way to generate long term returns. By investing a
lump sum or regular amount for 10 years or more, provided
certain conditions are met, earnings are tax-paid after this
period. This works in the following manner:
The contributions (investments) you make will
generally be in after tax dollars.
The returns earned on your investment will be treated
as income by Australian Unity Investment Bonds
Limited (AUIBL) and taxed at the company tax rate
(currently 30%). Unlike other managed investments,
you are not required to include the income earned on
your investment in your annual tax return (unless you
withdraw your investment within 10 years).
As AUIBL pays tax on the income earned, you don’t
pay further tax on withdrawal of the investment,
provided you hold the bond for more than 10 years. If
you decide to withdraw before 10 years, some or all
of the income earned will need be included in your tax
return (refer to page 22 for more information).
The Benefits of Investing in Australian Unity
Investment Bonds
Our Investment Bonds can meet the needs of various
investor types and styles.
A tax effective way to invest for the long term.
You can choose to invest in one or more of the five
Funds available.
You can switch from one Fund to another at any
time free of charge.
Your investment has no Pay-As-You-Go (PAYG) tax
liabilities.
You don’t need to make any annual tax declarations, or
keep capital gains records from year to year; provided
you hold your investment for 10 years.
There are no Tax File Number (TFN) requirements
when you start your investment.
You can nominate beneficiaries to receive your
investment proceeds in the event of your death.
Your investment is managed by a team of professional
investment managers, each specialists in their field.
So whether you are seeking capital security, capital growth,
or tax benefits, you can find an investment bond that suits
your needs.
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OUR INVESTMENT EXPERTISE
Investment Objective
To provide investors with a higher after-tax return than an equivalent investment in cash deposits over the medium term, with the added security of a ‘Capital Guarantee’.
Investment Strategy
The AUI Capital Guaranteed Bond (the ‘Fund’) invests primarily in quality fixed interest securities, mortgages, and cash securities.
Investment Manager
The current investment managers are Australian Unity Funds Management Limited (AUFM) and Vianova Asset Management Pty Ltd (Vianova). AUFM and Vianova are related parties to AUIBL. For more information on related parties please refer to page 24.
The Fund may invest in assets directly or through managed investment schemes.
We may add or remove an investment manager without prior notice to you.
Capital Guarantee
The Fund provides a capital guarantee. This means that your initial and subsequent contributions and annually declared bonuses (net of fees and taxes) are guaranteed to be paid by AUIBL on or after the selected maturity date or death of the life insured.
Investment Approach
The security of the capital guarantee is provided by the conservative nature of the Fund’s investments and continuous solvency reserve requirements that AUIBL maintains in accordance with Australian Prudential Regulation Authority (APRA) standards.
The solvency requirement was $228,420,971 as at 30 June 2005.
Investment Process
We select investment managers after conducting an extensive and rigorous research process that examines their investment style and process, the expertise of their investment team, past performance and a range of other factors. We review each investment manager’s performance on an ongoing basis, ensuring that they operate within agreed expectations and guidelines.
Derivatives
It is not our current policy to use derivatives for gearing purposes or for speculative activities for this investment. We and/or the underlying investment managers may use derivatives for implementation of interest rate risk strategies and management of the investment’s interest rate exposures.
Indicative Risk Level
The risk level indicator provides an estimate of the risks and volatility of the Fund. For more information about risks see page 9.
Suggested Investment Time Frame
At least 3 years.
Note: To achieve the tax-paid status you must hold the investment for a minimum of 10 years.
Portfolio Details
The information in this section may change from time to time. For up to date information please call Client Services on 13 29 39 or visit www.australianunity.com.au.
Asset allocation as at 31 March 2006
Bonus rates declared over the past 5 years
(1) Actual returns calculated after payment of tax by AUIBL. Rates used are 33% prior to 1 July 2001 and 30% since 1 July 2001.(2) Equivalent pre-tax return calculated assuming no payment of tax by AUIBL.
These bonus rates are calculated after management costs and Fund expenses. Past performance is not indicative of future performance.
Asset Class Range %
Actual %
Cash/short term securities 15 – 80 78
Mortgages 0 – 50 22
Australian fixed interest 0 – 60 0
Total 100
AUI CAPITAL GUARANTEED BOND
Low Medium High
Year to 30 June Tax paid%pa(1)
Pre-tax equivalent%pa(2)
2005 3.02 4.31
2004 3.38 4.83
2003 3.00 4.29
2002 2.50 3.57
2001 3.50 5.22
AUSTRALIAN UNITY INVESTMENTS 4
5 AUSTRALIAN UNITY INVESTMENTS
Investment Objective
To provide investors with a higher after-tax return than an equivalent investment in cash deposits over the medium term, with the added security of a ‘Capital Guarantee’.
Investment Strategy
The AUI Capital Guaranteed Mortgage Bond (the ‘Fund’) primarily invests in a portfolio of loans secured over quality retail, commercial, investment residential and industrial property. The Fund may also invest in other income producing assets.
Investment Manager
The current investment managers are Australian Unity Funds Management Limited (AUFM) and Vianova Asset Management Pty Ltd (Vianova). AUFM and Vianova are related parties to AUIBL. For more information on related parties please refer to page 24.
The Fund may invest in assets directly or through managed investment schemes.
We may add or remove an investment manager without prior notice to you.
Capital Guarantee
The Fund provides a capital guarantee. This means that your initial and subsequent contributions and annually declared bonuses (net of fees and taxes) are guaranteed to be paid by AUIBL on or after the selected maturity date or death of the life insured.
Investment Approach
The security of the capital guarantee is provided by the conservative nature of the Fund’s investments and continuous solvency reserve requirements that AUIBL maintains in accordance with Australian Prudential Regulation Authority (APRA) standards.
The solvency requirement was $55,908,102 as at 30 June 2005.
Investment Process
We select investment managers after conducting an extensive and rigorous research process that examines their investment style and process, the expertise of their investment team, past performance and a range of other factors. We review each investment manager’s performance on an ongoing basis, ensuring that they operate within agreed expectations and guidelines.
Derivatives
It is not our current policy to use derivatives for gearing purposes or for speculative activities for this investment. We and/or the underlying investment managers may use derivatives for implementation of interest rate risk strategies and management of the investment’s interest rate exposures.
Indicative Risk Level
The risk level indicator provides an estimate of the risks and volatility of the Fund. For more information about risks see page 9.
Suggested Investment Time Frame
At least 3 years.
Note: To achieve the tax-paid status you must hold the investment for a minimum of 10 years.
Portfolio Details
The information in this section may change from time to time. For up to date information please call Client Services on 13 29 39 or visit www.australianunity.com.au.
Asset allocation as at 31 March 2006
Bonus rates declared over the past 5 years
(1) Actual returns calculated after payment of tax by AUIBL. Rates used are 33% prior to 1 July 2001 and 30% since 1 July 2001.(2) Equivalent pre-tax return calculated assuming no payment of tax by AUIBL.
These bonus rates are calculated after management costs and Fund expenses. Past performance is not indicative of future performance.
AUI CAPITAL GUARANTEED MORTGAGE BOND
Low Medium High
Asset Class Range %
Actual %
Cash/short term securities 10 – 40 33
Mortgages 60 – 80 67
Australian fixed interest 0 – 30 0
Total 100
Year to 30 June Tax paid%pa(1)
Pre-tax equivalent%pa(2)
2005 3.46 4.94
2004 4.31 6.16
2003 4.00 5.71
2002 3.05 4.36
2001 4.00 5.97
Investment Objective
To provide investors with stable growth returns over the medium term.
Investment Strategy
The AUI Conservative Growth Bond (the ‘Fund’) invests in a diversified investment portfolio, with the majority of assets in quality fixed interest securities, mortgages and cash securities. The Fund maintains a modest exposure to growth assets such as Australian and international shares and property securities.
Investment Manager
The current investment managers are Australian Unity Funds Management Limited, Acorn Capital Limited, Platypus Asset Management Pty Ltd, Intech Fiduciaries Limited, INVESCO, Legg Mason Asset Management Australia Limited, Credit Suisse Asset Management Limited and Vianova Asset Management Pty Ltd.
Some of these investment managers are related parties to AUIBL. For more information on related parties please refer to page 24.
We may add or remove an investment manager without prior notice to you.
Investment Approach
This is a diversified fund with a bias toward income producing assets.
The Fund offers the benefits of asset diversification as well as the skills of a strong team of specialist investment managers who are recognised as being experts in their particular asset class. This approach aims to provide consistent returns with controlled risk across all market cycles.
The Fund may invest in assets directly or through managed investment schemes.
Investment Process
We select investment managers after conducting an extensive and rigorous research process that examines their investment style and process, the expertise of their investment team, past performance and a range of other factors. We review each investment manager’s performance on an ongoing basis, ensuring that they operate within agreed expectations and guidelines.
Derivatives
It is not our current policy to use derivatives for gearing purposes or for speculative activities for this investment. We and/or the underlying investment managers may use derivatives for hedging purposes and for implementing portfolio positions.
Indicative Risk Level
The risk level indicator provides an estimate of the risks and volatility of the Fund. For more information about risks see page 9.
Suggested Investment Time Frame
At least 3 years.
Note: To achieve the tax-paid status you must hold the investment for a minimum of 10 years.
Portfolio Details
The information in this section may change from time to time. For up to date information please call Client Services on 13 29 39 or visit www.australianunity.com.au.
Asset allocation as at 31 March 2006
Returns to 31 March 2006
(1) Actual returns calculated after payment of tax by AUIBL. Rates used are 33% prior to 1 July 2001 and 30% since 1 July 2001.(2) Equivalent pre-tax return calculated assuming no payment of tax by AUIBL.
These returns are calculated after management costs and Fund expenses. Past performance is not indicative of future performance.
AUI CONSERVATIVE GROWTH BOND
Low Medium High
Asset Class Range %
Actual %
Cash/short term securities 5 – 30 10
Mortgages 0 – 35 1
Australian fixed interest 10 – 75 58
Property 0 – 20 10
Australian shares 0 – 25 15
International shares 0 – 20 6
Total 100
1 year%
3 years%pa
5 years%pa
Tax-paid return(1) 7.91 6.92 5.10
Pre-tax equivalent(2) 11.46 10.02 7.36
AUSTRALIAN UNITY INVESTMENTS 6
7 AUSTRALIAN UNITY INVESTMENTS
Investment Objective
To provide investors with solid growth returns over the medium to long term.
Investment Strategy
The AUI Balanced Growth Bond (the ‘Fund’) invests in a diversified investment portfolio, with the majority of assets in Australian and international shares and property securities. The Fund maintains a modest exposure to quality fixed interest securities, mortgages, property and cash securities.
Investment Managers
The current investment managers are Australian Unity Funds Management Limited, Acorn Capital Limited, Platypus Asset Management Pty Ltd, Intech Fiduciaries Limited, INVESCO, Legg Mason Asset Management Australia Limited, Credit Suisse Asset Management Limited and Vianova Asset Management Pty Ltd.
Some of these investment managers are related parties to AUIBL. For more information on related parties please refer to page 24.
We may add or remove an investment manager without prior notice to you.
Investment Approach
This is a diversified fund with a bias toward growth assets.
The Fund offers the benefits of asset diversification as well as the skills of a strong team of specialist investment managers, who are recognised as being experts in their particular asset class. This approach aims to provide consistent returns with controlled risk across allmarket cycles.
The Fund may invest in assets directly or through managed investment schemes.
Investment Process
We select investment managers after conducting an extensive and rigorous research process that examines their investment style and process, the expertise of their investment team, past performance and a range of other factors. We review each investment manager’s performance on an ongoing basis, ensuring that they operate within agreed expectations and guidelines.
Derivatives
It is not our current policy to use derivatives for gearing purposes or for speculative activities for this investment. We and/or the underlying investment managers may use derivatives for hedging purposes and for implementing portfolio positions.
Indicative Risk Level
The risk level indicator provides an estimate of the risks and volatility of the Fund. For more information about risks see page 9.
Suggested Investment Time Frame
At least 5 years.
Note: To achieve the tax-paid status you must hold the investment for a minimum of 10 years.
Portfolio Details
The information in this section may change from time to time. For up to date information please call Client Services on 13 29 39 or visit www.australianunity.com.au.
Asset allocation as at 31 March 2006
Returns to 31 March 2006
(1) Actual returns calculated after payment of tax by AUIBL. Rates used are 33% prior to 1 July 2001 and 30% since 1 July 2001.(2) Equivalent pre-tax return calculated assuming no payment of tax by AUIBL.
These returns are calculated after management costs and Fund expenses. Past performance is not indicative of
future performance.
AUI BALANCED GROWTH BOND
Low Medium High
Asset Class Range %
Actual %
Cash/short term securities 0 – 30 5
Mortgages 0 – 35 1
Australian fixed interest 0 – 60 23
Property 0 – 20 10
Australian shares 15 – 45 35
International shares 0 – 30 26
Total 100
1 year%
3 years%pa
5 years%pa
Tax-paid return(1) 15.29 11.10 6.82
Pre-tax equivalent(2) 22.43 16.16 9.87
Investment Objective
To provide investors with strong growth returns over the long term.
Investment Strategy
The AUI High Growth Bond (the ‘Fund’) primarily invests in Australian and international shares, with a small allocation to cash securities.
Investment Manager
The current investment managers are Australian Unity Funds Management Limited, Acorn Capital Limited, Platypus Asset Management Pty Ltd, and Intech Fiduciaries Limited.
Some of these investment managers are related parties to AUIBL. For more information on related parties please refer to page 24.
We may add or remove an investment manager without prior notice to you.
Investment Approach
This is a diversified growth fund that invests primarily in growth assets.
The Fund offers the benefits of asset diversification as well as the skills of a strong team of specialist investment managers who are recognised as being experts in their particular asset class.
The Fund may invest in assets directly or through managed investment schemes.
Investment Process
We select investment managers after conducting an extensive and rigorous research process that examines their investment style and process, the expertise of their investment team, past performance and a range of other factors. We review each investment manager’s performance on an ongoing basis, ensuring that they operate within agreed expectations and guidelines.
Derivatives
It is not our current policy to use derivatives for gearing purposes or for speculative activities for this investment. We and/or the underlying investment managers may use derivatives for hedging purposes and for implementing portfolio positions.
Indicative Risk Level
The risk level indicator provides an estimate of the risks and volatility of the Fund. For more information about risks see page 9.
Suggested Investment Time Frame
At least 5 years.
Note: To achieve the tax-paid status you must hold the investment for a minimum of 10 years.
Portfolio Details
The information in this section may change from time to time. For up to date information please call Client Services on 13 29 39 or visit www.australianunity.com.au.
Asset allocation as at 31 March 2006
Returns to 31 March 2006
(1) Actual returns calculated after payment of tax by AUIBL. Rates used are 33% prior to 1 July 2001 and 30% since 1 July 2001.(2) Equivalent pre-tax return calculated assuming no payment of tax by AUIBL.
These returns are calculated after management costs and Fund expenses. Past performance is not indicative of
future performance.
AUI HIGH GROWTH BOND
Low Medium High
Asset Class Range %
Actual %
Cash/short term securities 0 – 10 5
Australian shares 30 – 50 40
International shares 40 – 60 55
Total 100
1 year%
3 years%pa
5 years%pa
Tax-paid return(1) 19.22 12.33 3.44
Pre-tax equivalent(2) 28.33 17.95 4.85
AUSTRALIAN UNITY INVESTMENTS 8
9 AUSTRALIAN UNITY INVESTMENTS
Investors should carefully consider all risks before making
an investment decision. Investors should also consider
their own personal circumstances (including financial and
taxation issues). The following comments are general in
nature and are intended as a guide only. We recommend
that you seek professional financial advice when making an
investment decision.
Generally speaking, an investment with a higher expected
return would exhibit a higher level of risk.
Return generally refers to the change in value of an
investment and includes any capital growth and income
earned. It is possible for returns to be negative. Risk
generally refers to the variability and volatility of returns
and also may provide an indication of the frequency of a
negative return.
The graph below provides an estimate of the level of risk
relative to the expected return from particular types of
investments.
Risk versus return
The relationship of risk to return may change from time to
time for each asset class. But over the long term (a period
greater than five years) growth assets such as shares
and property tend to achieve greater returns than income
assets such as cash, mortgages and fixed interest.
It is important to note, however, that in the short term (a
period of less than three years), growth assets are likely
to experience greater variation in returns (including the
possibility of negative returns), than income assets.
All investments are subject to risk. Some of the investment
risks that we believe investors should consider before
investing are listed below. The risks outlined in this PDS
are not a comprehensive assessment of all possible risks.
Investors should be aware that all the risks outlined may
impact returns.
General Investment Risks
Government fiscal or monetary policy changes may
impact on investment markets.
Social and technological change may make certain
investments less attractive.
There may be changes in investment conditions
including taxation treatment, new Government policy
and statutory changes.
Changes may occur in the interpretation and
application of the law by the courts and revenue
authorities.
Economic conditions, global events, local and
overseas political events, interest rates, inflation
and inflationary expectations may cause adverse
investment returns.
Inadequate diversification associated with not
spreading investments across different asset classes
may impact on returns.
Financial and investment market changes and values
can impact directly or indirectly on investment returns.
Natural disasters, social unrest and war can occur.
Specific Investment Risks
Fixed interest
The market value of fixed interest securities can fall
significantly when interest rates rise and rise when
interest rates fall.
An issuer of a fixed interest security may not be
able to repay either the principal or make interest
repayments (an event of default).
Mortgages
The borrower may not be able to repay the principal or
make interest payments.
In the event of a default, sale proceeds from the
property securing the loan may be less than the
principal and interest outstanding.
Falling interest rates can result in lower interest
payments on variable rate loans. Conversely, rising
interest rates can result in higher interest payments
on variable rate loans.
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INVESTMENT RISKS
High
Low
Low HighRelative Risk
Rel
ativ
e R
etu
rn
Fixed Interest
Cash
Int'l Shares
Property
Aust. Shares
Mortgages
Property
Investment in property (other than through listed
property trusts) is generally considered less liquid than
most other asset classes.
Similar to shares, listed property trusts can rise and/or
fall in value. Returns from listed property trusts are
affected by fluctuations in interest rates, the supply
and demand for properties and consequent changes in
rental levels.
Properties may experience movements in rental and
occupancy levels as well as tenancy lease defaults.
Properties can also rise and/or fall in value.
Shares
Share prices can experience volatile price movements
and dividend payments.
A company in which the Fund invests in, or the
industry or business in which it operates, may not
perform as well as expected.
Shares and other equity securities may decline in
value or may not pay income for a variety of reasons.
These include falls in investor confidence, poor
management or changes in a company’s competitive
environment or internal operations.
Rising interest rates can have a negative impact on
a company’s value, as increased borrowing costs
incurred by a company may cause earnings to decline,
and as a result the share price may fall.
Derivatives
Where derivatives are used, there is the risk that the
counter-party to the transaction may not be able to
meet its obligations. The investment manager may
then have to replace the transaction, which may be
at rates that are not favourable to the Fund. The use
of exchange-traded derivatives mitigates the counter-
party risk.
Other Risks
The following risks are inherent within any investment
bond:
There may be different tax outcomes if you invest in
an investment bond compared to investing directly.
There may be delays in withdrawing your investment.
A fund may be terminated.
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Managing Risk
While we are not able to eliminate all investment risks, we
seek to manage the impact of these risks through the use
of carefully considered investment guidelines.
Investment diversification is employed within each Fund
to help reduce risk. Where possible, the investment
managers seek to spread each Fund’s investment portfolio
across different investments and sectors, as diversification
can achieve long term objectives while minimising the
impact of short term volatility.
All related party transactions are conducted on normal
commercial terms and conditions, and on an arm’s length
basis.
How can you manage your risk?
We recommend that you seek your own professional
advice to help you understand your current financial
situation, set your investment objectives and establish a
plan to meet them.
It is important to consider your investment timeframe, your
investment objectives and your risk tolerance.
Diversifying your investments can also help reduce risk and
the volatility of investment returns.
Additional information on our Investment Bonds
For the AUI Capital Guaranteed Bond and the AUI Capital
Guaranteed Mortgage Bond, repayment of capital and
declared bonuses is guaranteed (see pages 4 and 5).
For the AUI Conservative Growth Bond, the AUI Balanced
Growth Bond and the AUI High Growth Bond, repayment
of capital is not guaranteed.
AUSTRALIAN UNITY INVESTMENTS 10
11 AUSTRALIAN UNITY INVESTMENTS
Applications
Application can be made in individual or in joint names. Up to three people may jointly own an investment bond policy. If any of the joint owners dies, the surviving owners automatically become the full owners of the policy. All transactions require the authorisation of all joint owners.
As investment bonds are a type of life insurance policy, you must nominate a policy owner and a life insured. The policy owner and the life insured are usually the same person. However, they can be different people.
The policy owner has all the legal ownership rights applicable to the investment.
Unless a person other than the policy owner is specified as the life insured, the policy owner will automatically be taken to be the life (or joint lives) insured. In this case, the policy will mature upon the death of the surviving joint owner. For example where a husband and wife own a policy, if one party dies, the policy will continue in the name of the survivor until the normal policy maturity date or the death of that surviving party.
Nominating a Beneficiary
You can nominate a beneficiary to receive the proceeds of your bond if you die before the maturity date. Proceeds will be paid directly to the nominated beneficiary. To nominate a beneficiary, simply complete section G ‘Beneficiary details’ on the Application Form. If you don’t nominate a beneficiary, the proceeds of your bond will form part of your estate.
Choosing your Policy Term
When you start your investment bond, you need to decide your policy term (that is, the number of years until bond maturity).
You can select a term of between 10 years and 40 years. The selection of a policy term does not affect your right to withdraw your investment at any time. If you do not select a policy term, the default term of 40 years will apply.
Your Initial Investment
To invest, complete the Application Form located at the back of this PDS, and return it to us with your cheque or direct debit request. The minimum initial investment into any Fund outlined in this PDS is $1,000. We reserve the right to vary this minimum at our discretion.
We can only process your application when we receive a completed current Application Form with your initial investment amount.
Your instruction to invest, and your investment proceeds, must be received at our registered office by 3.00pm (Melbourne time) on a Melbourne business day for you to receive the application price effective for that day. This price is generally released the following Melbourne business day.
If your instruction to invest, and your investment proceeds, are received after 3.00pm you will receive the application price effective for the next Melbourne business day.
Additional Investments
As a result of the ‘tax paid’ nature of investment bonds, the Government has placed limits on the amount of additional investment you can make to an investment bond.
During the first year following your initial investment, there is no maximum limit on the amount of additional investments you can make. In the second and subsequent years, you can contribute up to 125% of the total of your previous year’s contributions. You cannot make additional contributions following a year of zero additional contributions.
The minimum amount for additional investments is $500. We reserve the right to vary this minimum at our discretion.
To make additional investments, please complete a current application form. If you need another Application Form please contact Client Services on 13 29 39 Australia-wide.
Additional investments are made on the terms and conditions set out in the PDS current at the time the investments are made.
Regular Savings Plan
The Regular Savings Plan provides you with the opportunity to use a disciplined approach to your personal savings. The minimum regular investment amount is $100 per month and can be made either monthly, quarterly, half yearly or yearly, without having to complete a current Application Form each time. We reserve the right to vary this minimum at our discretion. Simply tick the Regular Savings Plan option on the current Application Form and nominate the amount you would like to invest on an ongoing basis.
We will arrange for funds to be automatically drawn from your Australian bank, building society or credit union account, normally on the 12th day of the month or the next Melbourne business day if the 12th is a weekend or public holiday.
Changes can be made at any time by notifying us in writing at least five Melbourne business days before the next automatic contribution is due. You can:
Change your regular investment amount provided it stays above $100 per month (or other amount notified to you).
Change the frequency of payment.
Change your nominated Australian bank or financial institution account.
Suspend the Plan.
Stop the Plan (recommencing the Plan will require a new Application Form to be completed).
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INVESTING WITH US
The normal contribution fees and management costs apply to investments made through the Regular Savings Plan (see page 15). In addition, bank transaction fees and Government charges may apply. Bank dishonour fees may also apply if you do not maintain sufficient funds to cover the regular investment.
Participation in the Regular Savings Plan will automatically cease if two consecutive payments are dishonoured, or if you close your account.
We are entitled to change or terminate the Regular Savings Plan by providing you with prior written notice.
If you select the Regular Savings Plan, we will send you a copy of the current PDS, and any updates while we continue to offer this facility. You should keep the current PDS and any updated information for your reference.
When using the Regular Savings Plan it is important to remember the additional investment limits described on page 11.
Further Information about Applications
If your financial institution dishonours your cheque your application will be reversed.
We reserve the right to accept or reject any application or additional investment (in whole or in part) at our discretion.
Switching between Funds
You can switch part (a minimum of $1,000) or all of your investment between the Funds described in this PDS at any time, free of charge. A minimum balance of $500 must be maintained in any one Fund.
Unlike many other forms of investment, switching can be done without affecting the valuable tax status of your investment. Please see ‘Taxation Information’ on page 22 for more information.
If you wish to switch all or part of your investment to another Fund, please contact Client Services on 13 29 39 Australia-wide or email us at [email protected] for the relevant switching forms.
Withdrawing Your Investment
You can withdraw some or all of your investment at any time by writing to us and providing your bank account details. If you are withdrawing your investment in full you are also required to provide the original Certificate of Membership. All withdrawal requests must be signed by you or your authorised representative.
The minimum withdrawal amount is $1,000 subject to the requirement that you maintain a minimum balance of $500 in the relevant Fund or you withdraw your entire investment. We reserve the right to vary these amounts at our discretion.
Withdrawal proceeds will only be paid to a nominated bank account. Cheque withdrawals are not available. You can send partial withdrawal requests to us by mail or fax (see page 24 for more details on faxing withdrawal requests). However, full withdrawal requests can only be made in writing with the original Certificate of Membership attached.
Your instruction to withdraw must be received at our registered office by 3.00pm (Melbourne time) on a Melbourne business day for you to receive the withdrawal value effective for that day. This value is generally determined the following Melbourne business day.
If your instruction to withdraw is received after 3.00pm you will receive the withdrawal value effective for the next Melbourne business day.
If you wish to withdraw your investment in the AUI Capital Guaranteed Bond or the AUI Capital Guaranteed Mortgage Bond, you can maximise your investment earnings by keeping $500 invested in your investment bond until after 30 June the following year. By doing so, the annual bonus that you receive as at 30 June will be based on the actual amount that you had invested during the year to 30 June calculated on a pro-rata daily basis.
On the other hand, if you withdraw your investment in full on or before 30 June, the withdrawal value will only be credited with the most recently declared interim bonus.
Payment period for withdrawals
AUIBL will generally pay withdrawals within five Melbourne business days. While all reasonable steps are taken to meet withdrawal requests within five Melbourne business days, the Benefit Fund Rules allow us up to 28 days to meet withdrawal requests.
Full Withdrawals during the Bonus Calculation Period
Each year between July and October withdrawals may be delayed while year-end bonus rates and unit prices are being determined.
If you would like to withdraw in full during this period you have two available options depending which Fund you have selected:
AUI Capital Guaranteed Bond and AUI Capital Guaranteed Mortgage Bond (Capital Guaranteed Funds)
Unless otherwise stated in your written withdrawal, we will pay your investment balance, plus the interim bonus, generally within five Melbourne business days. If requested in your written instruction, we will pay your withdrawal in two payments:
The first payment will consist of your total holding less $500. This will generally be paid within five Melbourne business days.
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AUSTRALIAN UNITY INVESTMENTS 12
13 AUSTRALIAN UNITY INVESTMENTS
The second payment will consist of the remaining $500 plus the full bonus owed. This payment will occur once the bonus rates have been calculated
generally in October each year.
AUI Conservative Growth Bond, AUI Balanced Growth Bond and AUI High Growth Bond (Unit Linked Funds)
Unless otherwise stated in your written withdrawal, we will pay your investment balance using the last known unit price. This payment is generally made within five Melbourne business days.
If requested in your written instruction, we will pay your withdrawal in two payments:
The first payment will consist of 80% of your investment balance. This will generally be paid within five Melbourne business days.
The second payment will consist of the remaining 20% of your investment balance plus the movement in unit price. This payment will occur once the unit prices have been finalised generally in October each year.
Regular Withdrawal Facility
If you need a flexible and regular income stream, you can choose to automatically receive regular payments from your investment bond policy.
You can choose from monthly or quarterly payments to suit your needs. The minimum payment amount is $500. Regular payments can only be made where you have sufficient investments in your policy to meet the withdrawal request.
Proceeds will be directly credited into your Australian bank, building society or credit union account. Payments will generally be made on the 15th day of the month.
If you wish to change or stop your Regular Withdrawal Facility, we require five Melbourne business days written notice from you in order to process any alteration to your Regular Withdrawal Facility.
Note: A withdrawal may be equivalent to a partial surrender of your investment or a return of capital. In the first case, investment gains will be included in your assessable income. In the second case, the cost base of your investment for capital gains tax purposes may require adjustment. We recommend you obtain taxation advice from an appropriately qualified taxation adviser.
Payment on death of the Life Insured
We will pay the full surrender value of the policy to the policy owner following the death of the life insured.
If the life insured and the policy owner are the same person, we will pay the full surrender value to the nominated beneficiaries or to the deceased’s estate.
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In the case of joint ownership, the policy continues in the name of the surviving owners.
Transferring Your Investment to Another Person
You can transfer (assign) your investment to another person (the assignee) at any time, subject to the assignment being in the form approved by us and the assignee meeting the application requirements of the Fund.
Suspension of Applications and Withdrawals
In exceptional circumstances where we consider it to be in the best interest of investors, we may choose to suspend the processing of all applications and/or withdrawals.
If this occurs, your application or withdrawal will be processed using the next available price. For further information on withdrawing or transferring, please call us on 13 29 39.
Cooling Off Period
Generally you have a 14 day cooling off period to decide if this investment is right for you. The 14 day period starts on the earlier of the date you receive your Certificate of Membership or five Melbourne business Days after we sent it to you.
Should you wish to cancel your investment during this period, please write to us prior to the expiration of this period (our contact details are located on the inside back cover) and return your Certificate of Membership.
The amount repaid to you is adjusted in accordance with the Corporations Act 2001 to reflect:
any increase or decrease in the value of your investment;
any tax or duties payable by us; and
transaction costs associated with the acquisition and termination of your investment.
You may also be charged a fee for reasonable expenses incurred by us (see page 20 'Cooling off-fee' for further information). Accordingly, depending on the circumstances, the amount repaid may be greater or less than the amount invested.
Labour Standards or Environmental, Social or
Ethical Considerations
We do not take into account labour standards or environmental, social or ethical considerations in the selection, retention or realisation of investments in the Funds offered under this PDS. However, we do have an overall policy of always acting legally, acting in the best interests of investors, and dealing with parties who, to the best of our knowledge, are reputable organisations.
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The AUI Capital Guaranteed Bond and the AUI Capital
Guaranteed Mortgage Bond are designed as accumulation
funds, with investment balances, add-on contributions and
annual bonus entitlements.
The AUI Conservative Growth Bond, the AUI Balanced
Growth Bond and the AUI High Growth Bond are designed
as unit linked accumulation funds, with investment
balances, add-on contributions and earnings being reflected
in their respective unit prices.
Capital Guaranteed Funds
The earnings achieved from the AUI Capital Guaranteed
Bond’s and the AUI Capital Guaranteed Mortgage Bond’s
underlying investments are allocated to policyholders in the
form of bonuses. A ‘bonus’ is the amount credited to your
account as earnings on your investment.
Bonuses are calculated annually as at 30 June each year
and credited to policyholder accounts generally by 30
September each year.
Annual bonuses are credited to accounts current as
at 30 June each year and are calculated on a pro-rata
daily basis.
Interim bonuses are payable to investors who
withdraw their investment during the year, based on
the length of time that they were invested in the bond
since the last bonus was payable (calculated from 1
July each year). The interim bonus rate is normally
less than the annual bonus rate.
The bonus rates are determined by an independent
actuary after consideration of the returns achieved by the
underlying investments and APRA solvency and capital
adequacy reserve requirements. The AUIBL Board of
Directors reviews the actuary's recommendations and
decides on the declared annual bonus and interim bonus
rates.
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Unit Linked Funds
Unit Pricing
The unit price for each Unit Linked Fund is generally
calculated for each Melbourne business day, taking into
consideration the market value of the investments of
the Fund, less any amounts owing and any accurals for
expenses, and interest, (i.e. the net asset value of a Fund)
then divided by the number of units issued in the Fund.
The market value for a Fund’s assets includes the value
of all its investments, any cash held in the Fund and
income accrued, but not received. These values are based
on the information most recently available at the time of
calculating the application and withdrawal unit price.
For daily unit price updates please visit our website
www.australianunity.com.au or call us on 13 29 39.
Benefits of Compounding
As earnings are not paid out until your investment is
withdrawn, you benefit from the effects of compounding.
That is, your reinvested earnings will themselves generate
earnings for you
BONUSES AND UNIT PRICES
AUSTRALIAN UNITY INVESTMENTS 14
15 AUSTRALIAN UNITY INVESTMENTS
Type of Fee or Cost Amount How and when paid
Option to pay contribution fees upfront
Option to pay contribution fees later
Fees when your money moves in or out of the Fund
Establishment feeThe fee to open your investment.
AUI Capital GuaranteedBond
AUI Capital GuaranteedMortgage Bond
AUI Conservative GrowthBond
AUI Balanced GrowthBond
AUI High Growth Bond
Nil
Nil
Nil
Nil
Nil
AUI Capital GuaranteedBond
AUI Capital GuaranteedMortgage Bond
AUI Conservative GrowthBond
AUI Balanced GrowthBond
AUI High Growth Bond
Nil
Nil
Nil
Nil
Nil
There are no establishment fees.
FEES AND OTHER COSTS
Government regulations require the inclusion of the following consumer advice warning in all product disclosure statements:
This document shows fees and other costs that you may be charged. These fees and costs may be deducted from your money, from the returns on your investment or from the fund assets as a whole. Taxes are set out in another part of this document.
You have 2 different fee payment options:
(a) to pay contribution fees upfront, at the time when you make each investment into the fund; or
(b) to pay contribution fees later (for example, on the termination of your investment or by way of other increased fees).
Note: You may pay more in total fees if you choose to pay contribution fees later.
You should read all the information about the fees and costs because it is important to understand their impact on your
investment.
DID YOU KNOW?
Small differences in both investment performance and fees and costs can have a substantial impact on your long-term returns. For example, total annual fees and costs of 2% of your
fund balance rather than 1% could reduce your final return by up to 20% over a 30-year period (for example, reduce it from $100,000 to $80,000).
You should consider whether features such as superior investment performance or the provision of better member services justify higher fees and costs. You may be able to
negotiate to pay lower contribution fees and management costs where applicable. Ask the fund or your financial adviser.
TO FIND OUT MORE
If you would like to find out more, or see the impact of the fees based on your own circumstances, the Australian Securities and Investments Commission (ASIC) website (www.fido.asic.gov.au) has a
managed investment fee calculator to help you check out different fee options.
AUSTRALIAN UNITY INVESTMENTS 16
Type of Fee or Cost Amount How and when paid
Option to pay contribution fees upfront
Option to pay contribution fees later
Fees when your money moves in or out of the Fund
Contribution fee (1)
The fee on each amount contributed to your investment.
AUI Capital Up to 3%Guaranteed Bond
AUI Capital Up to 3%Guaranteed Mortgage Bond
AUI Conservative Up to 4%Growth Bond
AUI Balanced Up to 4%Growth Bond
AUI High Growth Up to 4%Bond
An annual policy fee payable over 3 years of 0.75% per annum of the average balance in your account.
Upfront Contribution fees: Deducted from the initial
and every subsequent investment you make in
the Fund.
Contribution fees paid later:Deducted from your
account on 1 July each year for 3 years, or
when you withdraw your investments, whichever
occurs first.
You and your financial adviser may agree to a reduced Initial
Remuneration, which will have the effect of reducing
the contribution fee.
Withdrawal feeThe fee on each amount you take out of your investment.
AUI Capital GuaranteedBond
AUI Capital GuaranteedMortgage Bond
AUI Conservative Growth Bond
AUI Balanced GrowthBond
AUI High Growth Bond
Nil
Nil
Nil
Nil
Nil
For all Funds, withdrawals made in:
1st year:
2nd year:
3rd year:
After 3 years:
3%
2%
1%
Nil
Deducted from and calculated on, the amount
that is withdrawn from the Fund at the time of
withdrawal.
Termination feeThe fee to close your investment.
AUI Capital GuaranteedBond
AUI Capital GuaranteedMortgage Bond
AUI Conservative Growth Bond
AUI Balanced GrowthBond
AUI High Growth Bond
Nil
Nil
Nil
Nil
Nil
AUI Capital GuaranteedBond
AUI Capital GuaranteedMortgage Bond
AUI Conservative Growth Bond
AUI Balanced GrowthBond
AUI High Growth Bond
Nil
Nil
Nil
Nil
Nil
There are no termination fees.
17 AUSTRALIAN UNITY INVESTMENTS
Type of Fee or Cost Amount How and when paid
Option to pay contribution fees upfront
Option to pay contribution fees later
Management costs(1)
The fees and costs for managing your investment.
AUI Capital Guaranteed Bond
1.50% per annum of the net balance of the Fund.
AUI Capital Guaranteed Bond
1.50% per annum of the net balance of the Fund.
Management Fees are accrued daily and paid monthly in arrears by being deducted from
the Fund’s assets.
You and your financial adviser may agree
to a reduced Service Remuneration, which will have the effect of reducing Management
Fees.
AUI Capital Guaranteed Mortgage Bond
1.50% per annum of the net balance of the Fund.
AUI Capital Guaranteed Mortgage Bond
1.50% per annum of the net balance of the Fund.
AUI Conservative Growth Bond
1.65% per annum of the net balance of the Fund.
AUI Conservative Growth Bond
1.65% per annum of the net balance of the Fund.
AUI Balanced Growth Bond
1.85% per annum of the net balance of the Fund.
AUI Balanced Growth Bond
1.85% per annum of the net balance of the Fund.
AUI High Growth Bond
1.95% per annum of the net balance of the Fund.
AUI High Growth Bond
1.95% per annum of the net balance of the Fund.
Service fees
Investment switching feeThe fee for changing investment options.
AUI Capital GuaranteedBond
AUI Capital GuaranteedMortgage Bond
AUI Conservative Growth Bond
AUI Balanced GrowthBond
AUI High Growth Bond
Nil
Nil
Nil
Nil
Nil
AUI Capital GuaranteedBond
AUI Capital GuaranteedMortgage Bond
AUI Conservative Growth Bond
AUI Balanced GrowthBond
AUI High Growth Bond
Nil
Nil
Nil
Nil
Nil
There are no switching fees.
(1) This fee includes an amount payable to an adviser. (See ‘Adviser remuneration’ under the heading ‘Additional Explanation of Fees and Costs’.)
AUSTRALIAN UNITY INVESTMENTS 18
Example of annual fees and costs
This table gives an example of how the fees and costs in the AUI Capital Guaranteed Bond can affect your investment over a
1 year period. You should use this table to compare this product with other investment products.
Example – The AUI Capital Guaranteed Bond BALANCE OF $50,000 WITH A CONTRIBUTION OF $5,000 DURING YEAR
Contribution Fees Up to 3% For every additional $5,000 you put in, you will be charged $150.
PLUS Management Costs 1.50%pa And, for every $50,000 you have in the Fund you will be charged $750 each year.
EQUALS Cost of Fund
If you had an investment of $50,000 at the beginning of the year and you put in an additional $5,000 during that year, you would be charged fees of from $750 to $900.(1)(2)
What it costs will depend on the investment option you choose and the fees you negotiate with your financial adviser.
Additional fees may apply: (1) It is assumed that the contribution of $5,000 is made at the end of the year.(2) If you choose to pay contribution fees later and you leave the Fund within the first 3 years, you may also be charged withdrawal fees of between 0% and 3% of the amount withdrawn (between $0 and $1,500 for every $50,000 you withdraw).
This table gives an example of how the fees and costs in the AUI Capital Guaranteed Mortgage Bond can affect your investment over a 1 year period. You should use this table to compare this product with other investment products.
Example – The AUI Capital Guaranteed Mortgage Bond BALANCE OF $50,000 WITH A CONTRIBUTION OF $5,000 DURING YEAR
Contribution Fees Up to 3% For every additional $5,000 you put in, you will be charged $150.
PLUS Management Costs 1.50%pa And, for every $50,000 you have in the Fund you will be charged $750 each year.
EQUALS Cost of Fund
If you had an investment of $50,000 at the beginning of the year and you put in an additional $5,000 during that year, you would be charged fees of from $750 to $900.(1)(2)
What it costs will depend on the investment option you choose and the fees you negotiate with your financial adviser.
Additional fees may apply: (1) It is assumed that the contribution of $5,000 is made at the end of the year.(2) If you choose to pay contribution fees later and you leave the Fund within the first 3 years, you may also be charged withdrawal fees of between 0% and 3% of the amount withdrawn (between $0 and $1,500 for every $50,000 you withdraw).
This table gives an example of how the fees and costs in the AUI Conservative Growth Bond can affect your investment over a 1 year period. You should use this table to compare this product with other investment products.
Example – The AUI Conservative Growth Bond BALANCE OF $50,000 WITH A CONTRIBUTION OF $5,000 DURING YEAR
Contribution Fees Up to 4% For every additional $5,000 you put in, you will be charged $200.
PLUS Management Costs 1.65%pa And, for every $50,000 you have in the Fund you will be charged $825 each year.
EQUALS Cost of Fund
If you had an investment of $50,000 at the beginning of the year and you put in an additional $5,000 during that year, you would be charged fees of from $825 to $1,025.(1)(2)
What it costs will depend on the investment option you choose and the fees you negotiate with your financial adviser.
Additional fees may apply: (1) It is assumed that the contribution of $5,000 is made at the end of the year.(2) If you choose to pay contribution fees later and you leave the Fund within the first 3 years, you may also be charged withdrawal fees of between 0% and 3% of the amount withdrawn (between $0 and $1,500 for every $50,000 you withdraw).
19 AUSTRALIAN UNITY INVESTMENTS
This table gives an example of how the fees and costs in the AUI Balanced Growth Bond can affect your investment over a 1 year period. You should use this table to compare this product with other investment products.
Example – The AUI Balanced Growth Bond BALANCE OF $50,000 WITH A CONTRIBUTION OF $5,000 DURING YEAR
Contribution Fees Up to 4% For every additional $5,000 you put in, you will be charged $200.
PLUS Management Costs 1.85%pa And, for every $50,000 you have in the Fund you will be charged $925 each year.
EQUALS Cost of Fund
If you had an investment of $50,000 at the beginning of the year and you put in an additional $5,000 during that year, you would be charged fees of from $925 to $1,125.(1)(2)
What it costs will depend on the investment option you choose and the fees you negotiate with your financial adviser.
Additional fees may apply: (1) It is assumed that the contribution of $5,000 is made at the end of the year.(2) If you choose to pay contribution fees later and you leave the Fund within the first 3 years, you may also be charged withdrawal fees of between 0% and 3% of the amount withdrawn (between $0 and $1,500 for every $50,000 you withdraw).
This table gives an example of how the fees and costs in the AUI High Growth Bond can affect your investment over a 1 year period. You should use this table to compare this product with other investment products.
Example – The AUI High Growth Bond BALANCE OF $50,000 WITH A CONTRIBUTION OF $5,000 DURING YEAR
Contribution Fees Up to 4% For every additional $5,000 you put in, you will be charged $200.
PLUS Management Costs 1.95%pa And, for every $50,000 you have in the Fund you will be charged $975 each year.
EQUALS Cost of Fund
If you had an investment of $50,000 at the beginning of the year and you put in an additional $5,000 during that year, you would be charged fees of from $975 to $1,175.(1)(2)
What it costs will depend on the investment option you choose and the fees you negotiate with your financial adviser.
Additional fees may apply: (1) It is assumed that the contribution of $5,000 is made at the end of the year.(2) If you choose to pay contribution fees later and you leave the Fund within the first 3 years, you may also be charged withdrawal fees of between 0% and 3% of the amount withdrawn (between $0 and $1,500 for every $50,000 you withdraw).
AUSTRALIAN UNITY INVESTMENTS 20
Additional Explanation of Fees and Costs
Stamp duty
Entry into an investment bond may have stamp duty consequences. Any stamp duty will be debited fromyour account.
Tax
All fees, charges and adviser remuneration shown are
inclusive of the impact of GST (where applicable) and net
of any Input Tax Credits (ITCs) available to each of the
respective Funds, except where otherwise indicated. Please
refer to the ‘Tax Information’ section on page 22 for further
information on tax.
Other expenses and costs
Expenses incurred in the day-to-day operation of a Fund (such as audit, compliance, custody, registry and regulatory costs) and which are recoverable under the Benefit Fund Rules are included in the Management Costs detailed in the table on pages 15 to 17, except for the following:
expenses that would have been incurred by a direct investor in the underlying assets such as transaction costs (see ‘Fund transaction costs’ below); and
abnormal operating expenses – these are costs not generally incurred in the day-to-day operation of the Fund (see ‘Abnormal operating expenses’ below).
Each Fund may also incur other costs directly associated with transactions made on your policy. Examples of these costs include Government taxes, bank dishonour and transaction fees, and any other charges resulting from you transacting on your policy. These costs will be directly deducted from your policy.
We are unable to estimate these costs until they are incurred.
Abnormal operating expenses
These charges represent a reimbursement to us from each of the Funds in accordance with the Benefit Fund Rules to cover abnormal operating expenses incurred by us in connection with the performance of our duties and obligations in administering each Fund.
These abnormal operating expenses are not generally incurred during the day-to-day operation of each Fund and are not necessarily incurred in any given year and have not been included in the Management Costs outlined in the table on pages 15 to 17. They are due to abnormal events such as the cost of running investor meetings or the legal costs of defending legal proceedings.
Fund transaction costs
Fund transaction costs are Fund costs relating to the buying and selling of investments (such as asset acquisition and disposal costs), asset origination costs (including, where applicable, fees and commissions), brokerage and Government charges.
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These costs are incurred in the day-to-day management of each Fund and will be paid directly from each Fund. These costs are not included in the Management Costs referred to in the table on pages 15 to 17.
Cooling off – fee
If you decide that you no longer wish to invest in the Fund within the 14 day cooling off period, we may charge you a fee of $50.00. This fee is deducted from your investment prior to us returning your money to you.
Fee rebates
From time to time, we may rebate some of our fees (or issue units in the Funds) to employees of AUIBL and related entities so that they pay reduced fees. We do not enter into individual fee arrangements with other investors.
Where a Fund invests in funds managed by us
The Funds may invest in funds or investment companies including those managed by us or our associates.
Where we, or an associate, are the responsible entity or manager of that fund, full management fees will not be received by us from both funds. Instead, our management fees will be adjusted to reflect the Fund’s fees described on pages 15 to 17.
Fee changes and maximum fees
Fees may increase or decrease for many reasons, including changes in the competitive, industry and regulatory environment or simply from changes in costs. We can change fees without your consent. We will not increase fees without providing at least three months written notice to you. If you withdraw within this notice period, the increased fees will not apply to you.
The maximum fees we are allowed to charge the Funds offered under this PDS (excluding GST) is stated in the Benefit Fund Rules as follows:
Contribution Fee: 5% of contributions to the Fund.
Management Fee: 2%* per annum.
Policy Fee: 1% per annum.
Switch Fee: 1% of amount to be switched.
Withdrawal Fee: 4% of the amount withdrawn.
* In the case of the AUI High Growth Bond, the maximum Management Fee is 3% per annum.
The Benefit Fund Rules govern the recovery of any other expenses.
For the actual fees charged, refer to pages 15 to 17.
Adviser remuneration
The financial adviser providing you with initial and ongoing advice may receive payment (remuneration) for providing this advice. Your financial adviser has to meet his/her expenses from this remuneration and also relies on it for income. Any adviser remuneration payable will be paid out of the fees we receive. Your financial adviser is required to disclose to you all remuneration received for placing your investment in a Fund. You and your financial adviser may agree that you will pay your financial adviser an additional fee outside the Fund.
If you choose not to use a financial adviser you will not generally be entitled to any rebates of the remuneration amounts outlined below.
From time to time, we may also offer other incentives (alternative remuneration) to your financial adviser, which are determined by us and paid out of our own money. A register of these payments and incentives is maintained by us (please see below).
All adviser remuneration quoted is inclusive of GST unless otherwise specified.
Where the Upfront Contribution Fee option is selected:
(1) Including initial and subsequent investments.(2) Calculated on the average daily value of your account and payable quaterly in arrears.
Where the Deferred Contribution Fee option is selected:
(1) Including initial and subsequent investments.
Your financial adviser may decide not to take any or all of the initial remuneration and/or service remuneration although there is no obligation for your adviser to do so.
Where this occurs:
any Contribution Fee applicable will be reduced by the same proportion as the percentage of initial remuneration foregone; and
the amount of service remuneration rebated (partial rebate is not available) will be paid to your account in the form of additional deposits or units each quarter. Depending on when you withdraw your entire investment in the Fund, the final quarter’s rebate may not be paid.
Alternative remuneration register
AUIBL maintains an Alternative Remuneration Register in accordance with the IFSA/FPA Industry Code of Practice on alternative forms of remuneration in the wealth management industry. The register outlines alternative forms of remuneration that are paid and received by us. Investors may inspect a copy of the register at our registered office at any time between 9.00am and 5.00pm on a Melbourne business day.
Financial adviser details
If you wish to negotiate the fees or costs as described above, contact your financial adviser, or if you cannot locate their details you can obtain them by contacting us on 13 29 39.
You will need to agree the above cost with your financial adviser and they will contact us to confirm those arrangements.
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21 AUSTRALIAN UNITY INVESTMENTS
InitialRemuneration(1)
Service Remuneration(2)
AUI Capital Guaranteed Bond; and
AUI Capital Guaranteed Mortgage Bond
3.22%($322.00
per $10,000 invested)
0.44%($44.00 per
$10,000 invested)
AUI Conservative Growth Bond;
AUI Balanced Growth Bond; and
AUI High Growth Bond
4.29%($429.00
per $10,000 invested)
0.44%($44.00
per $10,000 invested)
InitialRemuneration(1)
Service Remuneration
AUI Capital Guaranteed Bond; and
AUI Capital Guaranteed Mortgage Bond
2.75%($275.00
per $10,000 invested)
Nil
AUI Conservative Growth Bond;
AUI Balanced Growth Bond; and
AUI High Growth Bond
4.40%($440.00
per $10,000 invested)
Nil
AUSTRALIAN UNITY INVESTMENTS 22
The following is a broad summary of the basic taxation matters applicable to investment bonds and Australian resident investors (unless otherwise indicated) who hold their interest in an investment bond for long term investment on capital account. It is based on information, taxation legislation and industry practice that is current at the date of this PDS. Given the complexity of taxation legislation and the ongoing changes introduced by the Government and changes in the Australian Taxation Office interpretation, it is strongly recommended that investors obtain advice from a professional adviser particular to their circumstances.
No Tax paid by you while you hold an investment
bond
The earnings/growth in value of an investor’s investment bond will not attract a PAYG liability. Similarly, it will not be taken into account in determining any PAYG liability from year to year, or upon surrender of the investment after 10 years.
If an investor withdraws their investment within 10 years, some or all of the earnings will need to be included in the calculation of an investor’s taxable income at the time of withdrawal (refer to withdrawal information below).
Tax paid by AUIBL on your investment in the Fund
Investment earnings, including gains and losses on investments held in respect of investment bonds, are taxable at the corporate tax rate applicable to AUIBL (currently at the rate of 30%).
Where a Fund invests in Australian shares, imputation credits for any franked dividends received will reduce the tax payable in respect of the particular fund’s income.
Tax paid by investors on withdrawals
Withdrawals made after 10 Years
Provided an investor holds their investment bond for more than 10 years, they will not be subject to income tax or capital gains tax upon withdrawal.
Withdrawals made within 10 Years
Withdrawals made within 1 to 8 years
For withdrawals made within the first 8 years of the bond’s term, the full amount of any gain and earnings will be included in the investor’s assessable income.
Withdrawals made within 9 to 10 years
For withdrawals made within year 9 or 10, only two-thirds or one-third respectively, of their investment growth and earnings will be assessable.
The amounts included within assessable income (regardless of the withdrawal timeframe) will however be eligible for the 30% rebate. Accordingly, where an investors’ marginal tax rate
is less than 30%, the excess rebate can be used to reduce the investor’s tax liability payable in respect of other income.
If an investor uses the Regular Withdrawal Facility described on page 13, this will result in a partial withdrawal on each withdrawal, with tax consequences dependent on the period of investment as described above.
No Taxation upon Transfer
The transfer or assignment of an investment bond to another owner (provided this is done without consideration or payment), will generally entail no income taxation or capital gains tax for either the transferor or transferee. For tax purposes, the new owner will simply adopt the tax position of the former owner; with a full preservation of the investment’s tax advantaged status.
Similarly, investors can switch (fully or partially) to another investment bond option, and not be subject to taxation. This is because switching does not constitute a withdrawal from, or a surrender of, an original investment bond.
However, as some transfers or assignments may involve taxation consequence, it is recommended that professional taxation advice be obtained before this transaction is undertaken by an exiting investor.
Taxation Relief – for Death, Accident or Difficulty
In the event that death occurs before the maturity date of an investment bond, the investment earnings on the investment bond will not be subject to tax, even if the investment bond has been held for less than 10 years. If an investor suffers severe financial difficulty, accident, illness or other disability within 10 years of holding their investment bond, an exemption from income tax is available should they require the proceeds from their investment within the first 10 years of the term of the investment.
Tax File Numbers (TFN)
Under current legislation, investors in an investment bond are not required to provide AUIBL with their tax file number (TFN).
Further information about TFNs can be obtained from the Australian Taxation Office.
Goods and Services Tax (GST)
The acquisition, redemption or transfer of an investment bond is not subject to GST. Furthermore, no GST is payable upon any payment of benefits under an investment bond.
For specific advice in relation to the GST implications of your investment in the Funds you should contact your
accountant or financial adviser.
TAX INFORMATION
Benefit Fund Rules
The Australian Prudential Regulation Authority (APRA) in accordance with the Life Insurance Act 1995 has approved the Benefit Fund Rules (Rules) for all the investment bonds offered in this PDS.
Under the Rules, the assets of each Fund maintained by AUIBL are kept separate and distinct from the other assets held by AUIBL.
The approved Rules of each Fund, the Corporations Act 2001 and the Life Insurance Act govern the conduct of AUIBL and the terms and conditions of the policy owner’s entitlement under a Fund, including the payment of benefits and the operation of each Fund.
The statements in this PDS only provide a summary of some of the provisions of the Rules. Investors may inspect a copy of the Rules at our registered office at any time between 9.00am and 5.00pm (Melbourne time) on a Melbourne business day.
Contract with Policy Owners
On acceptance by AUIBL the applicant becomes a policy owner and is subject to the rights and obligations set out in the approved Rules. Two years following acceptance of the Fund application, the policy owner is eligible to become a member of Australian Unity Limited provided they retain the policy for that period. If accepted by Australian Unity Limited, the policy owner will then also be subject to the rights and obligations set out in the Constitution of Australian Unity Limited. The Rules and Constitution operate as a contract between members and AUIBL and Australian Unity Limited respectively.
Interest in the Fund
Capital Guaranteed Funds
Policy owners of the relevant Fund have an entitlement to a share in the AUI Capital Guaranteed Bond and the AUI Capital Guaranteed Mortgage Bond, being the proportion which the policy owner’s Accumulation Account Balance on the relevant date bears to the aggregate of the Accumulation Account Balances of all policy owners who have entitlements in relation to that investment bond, but do not have any specific interest in any part of the investment bond or any authorised investment thereof.
Unit Linked Funds
Policy owners have an entitlement to a share in the Flexi-Choice Fund (which covers the three Unit Linked Funds – the AUI Conservative Growth Bond, the AUI Balanced Growth Bond and the AUI High Growth Bond), being the proportion which the policy owner’s investment balance on the relevant date bears to the aggregate of all investment balances of all policy owners who have entitlements in relation to that
investment option, but do not have any specific interest in any part of that investment option or any other investment bond, or any authorised investment thereof.
Your Liability
Policy owners are not under any personal obligation to indemnify AUIBL (or its creditors) in respect of its liabilities in relation to the Funds.
Investment Managers
Any investment managers appointed by AUIBL are entitled to receive fees for investment management as agreed from time to time with AUIBL.
AUIBL has selected each of the investment managers appointed to manage the investment strategies, and may, during the life of the PDS, change the investment strategy and/or any of the appointed investment managers. We regularly review and monitor the performance of our investment managers and may change them at any time without giving notice.
Authorised Investments
Under each Fund’s Rules, AUIBL can invest in a broad range of investments. However, AUIBL currently limits the range of investments for the relevant Funds to those set out on pages 4 and 8 . Where AUIBL believes it to be in the investors' best interests, it can amend a Fund's investment guidelines without notice.
The Funds may invest in derivatives such as put and call options, futures contracts, forward rate agreements and foreign currency contracts for hedging purposes and to gain exposure to individual securities, currencies and sharemarkets.
The Life Insurance Act and Prudential Standards include requirement for minimum levels of funds to be held in liquid assets, generally defined as cash deposits and short term securities of less than 12 months duration. In addition, the Capital Guaranteed Funds are required to maintain a solvency reserve to protect against volatility in the value of their investments. The AUI Capital Guaranteed Bond and the AUI Capital Guaranteed Mortgage Bond both meet this requirement.
Borrowing
The Rules of the investment bonds do not permit AUIBL to borrow on behalf of any of the Funds.
Material Contracts
There are no material contracts other than the Rules for each Fund, the investment management agreements between Australian Unity Investment Bonds Limited and Australian Unity Funds Management Limited, and the investment management agreements with investment managers.
ADDITIONAL INFORMATION
23 AUSTRALIAN UNITY INVESTMENTS
AUSTRALIAN UNITY INVESTMENTS 24
Meetings of Policy Owners
Policy owners, as members of AUIBL, may attend and vote at general meetings of members of AUIBL convened in accordance with the Benefit Fund Rules. However, under the Life Insurance Act and Prudential Rules, meetings of policy owners may be convened for specific purposes, such as to approve the consolidation of benefit funds.
Terminating a Fund
AUIBL has the power to terminate the Funds in the manner prescribed by law.
Related Party Transactions
All transactions, including with related parties, are conducted on normal commercial terms and conditions, and on an arms length basis.
Entities of the Australian Unity Group may provide investment management, accounting and registry services, project services and other services to the Funds for which fees are charged at a commercial rate.
The Funds may invest in a managed investment scheme of which a related party is the responsible entity.
Australian Unity Funds Management Limited, Australian Unity Property Limited, Acorn Capital Limited, Platypus Asset Management Pty Ltd and Vianova Asset Management Pty Ltd are related parties to AUIBL.
Fax Instruction Service Conditions
By using our fax instruction service you release us from, and indemnify us against, all losses and liabilities arising from any payment or action we make based on any instruction (even if not genuine) that we receive by a fax bearing your investor code, a signature apparently yours or that of an authorised signatory for the investment. You also agree that neither you, nor anyone claiming through you, has any claim against us, or a Fund in relation to these payments or actions. Please be careful. There is a risk that a fraudulent fax redemption request can be made by someone who has access to your policy number and a copy of your signature. We reserve the right to add further requirements at any time.
Use of Your Information – Privacy
The privacy of your information is important to us. Your personal information is collected for the following purposes:
To administer products and services and manage our
relationship with you and to fulfil our obligations in
providing these products and services to you.
To process transactions, to answer queries and for
security purposes.
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To develop products and services.
To allow the Australian Unity Group to market
products and services to you (subject to your right to
opt-out of receiving various direct marketing materials
at any time). A current sample of these products and
services appears on the back cover of this PDS.
In managing your account, we may need to disclose your personal information to:
your financial adviser either directly or through other
service providers which we may have arrangements
with;
reputable service providers who may carry out
functions associated with our products and services
on our behalf. For example, mailing houses who
conduct mailouts for us;
our financial institution to initiate the drawing to your
nominated account (where you have selected the
Direct Debit facility); or
a third party as required by law.
You are entitled to request reasonable access to information we have about you. You should notify us immediately if any of the information we hold about you changes, so that we may ensure that your information is always complete, accurate and current. If you do not provide the information requested on the Application Form, we may be unable to process your application.
Our privacy policy can be found at:
www.australianunity.com.au
If you have any complaints or questions about the privacy of your personal information, please contact our Privacy Officer by writing to:
Australian Unity Privacy Officer
114 Albert RoadSouth Melbourne VIC 3205
If your complaint is not resolved by us to your satisfaction, you may write to the Privacy Commissioner at:
Office of the Federal Privacy Commission
GPO Box 5218Sydney NSW 1042
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Regular Reporting
We will keep in touch by sending you:
a Certificate of Membership confirming your initial
application;
a confirmation statement after each additional
investment (other than those made using the Regular
Savings Plan);
a bonus certificate or benefit schedule (depending on
which Funds you select) after each financial year; and
AUIBL’s financial statements at the end of each
financial year (unless you choose not to receive an
Annual Report). You can obtain a copy of the latest
AUIBL annual financial statements by calling us on
13 29 39.
If you have any queries on your investment or your personal
details change (e.g. change of address, name or bank account
details), please contact Client Services on 13 29 39 Australia-
wide or email us at [email protected].
For general information on your investment please visit our
website www.australianunity.com.au.
If a financial adviser’s stamp appears on the Application
Form, you authorise us to give information relating to your
account and investment in your account to your financial
adviser and acknowledge that your financial adviser is your
agent for the purpose of receiving this information.
Dispute Resolution
We take complaints seriously and aim to resolve them
as quickly as possible. You can either call us on 13 29 39,
email us at [email protected] or write to
us at the following address:
The Administration Manager
Australian Unity Investments
114 Albert Road
South Melbourne VIC 3205
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We will promptly acknowledge your complaint in writing
within 14 days, investigate it and decide in a timely manner
what action needs to be taken. We will notify you of our
decision within 45 days after receipt of the complaint,
together with any remedies that are available, or other
avenues of appeal against the decision.
If you are not satisfied with our handling of your complaint,
and your complaint was put to us in writing, you may
contact:
Financial Industry Complaints Service Limited
PO Box 579
Collins Street West
Melbourne VIC 8007
Telephone: 1300 780 808
Facsimile: (03) 9621 2291
Website: www.fics.asn.au
This service has been set up as an objective party to hear
unresolved complaints. There is no cost to you for using
this service.
KEEPING IN TOUCH
25 AUSTRALIAN UNITY INVESTMENTS
AUSTRALIAN UNITY INVESTMENTS 26
Please complete the Application Form in blue or black pen,
write in BLOCK LETTERS and sign where indicated.
You must complete at least sections A, C, E, F and J.
If you wish to:
nominate a life insured that is different to the
applicant(s) (policy owner(s)), complete section B;
start a Regular Savings Plan, complete sections D and
the Direct Debit Request;
nominate a beneficiary, complete section G; or
receive a regular withdrawal, complete section H.
Lodgement
Forward the completed Application Form, together with
either:
your cheque made payable to, Australian Unity
Investments – <name of applicant> and crossed ‘Not
Negotiable’; or
your completed Direct Debit Request and send to:
Australian Unity Investments
114 Albert Road
South Melbourne VIC 3205
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HOW TO APPLY
Our Commitment to You
This section sets out your rights, our commitment to you
and your responsibilities to us. It also specifies where
you should go for assistance in respect of your direct
debit arrangement with AUIBL. In terms of the DDR
arrangement made between us and signed by you, we
undertake to debit your nominated account in accordance
with your signed authority to direct debit.
Drawing Arrangements
For one off debits, payment will be drawn from
your nominated account on the date we accept your
application.
For regular debits, payment will normally start to be
drawn from your nominated account from the 12th
day of the month; in the month following the date
we receive your application (e.g. For an application
received on 1 March, the first deduction will occur on
12 April).
If any drawing falls due on a non-Melbourne business
day, it will be drawn from your account on the next
Melbourne business day following the scheduled
drawing date.
We will give you at least 14 days notice when we
intend to make changes to the initial terms of the
arrangement.
Changes to the Arrangement
If you want to make changes to the drawing arrangements,
please notify us in writing at least five Melbourne business
days prior to your next scheduled drawing date. These
changes may include:
deferring the drawing;
altering the schedule;
stopping an individual debit;
suspending the DDR; or
cancelling the DDR completely.
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Enquiries
If you have any enquiries they should be directed to
Australian Unity, rather than to your financial institution.
All personal customer information held by us will remain
confidential, except for information that may be provided
to our financial institution to initiate the drawing to your
nominated account, or information that may be disclosed
to a third party as required by law. Information may also be
provided to any of Australian Unity Limited’s wholly owned
subsidiaries to enable the DDR to be effected as required
by law.
Disputes
If you believe that a drawing has been initiated
incorrectly, you should raise the matter directly with
Australian Unity.
If you do not receive a satisfactory response from us,
your financial institution will respond to you with an
answer to your claim:
within seven Melbourne business days (for claims
lodged within 12 months of the disputed drawing);
or
within 30 Melbourne business days (for claims
lodged more than 12 months after the disputed
drawing).
You will receive a refund of the drawing amount if we
cannot substantiate the reason for the drawing.
Note: Your financial institution will ask you to contact us to
resolve your disputed drawing prior to involving them.
Your Commitment to Us
It is your responsibility to ensure that:
your nominated account can accept direct debits (your
financial institution can confirm this);
on the drawing date there are sufficient cleared funds
in the nominated account; and
you advise us if the nominated account is transferred
or closed.
If your drawing is returned or dishonoured by your financial
institution, we will notify you in writing. Any transaction
fees payable by us in respect of the above may be passed
on to you. Consecutive returns or dishonours may result in
the Direct Debit facility being cancelled by us.
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DIRECT DEBIT REQUEST (DDR) SERVICE AGREEMENT
27 AUSTRALIAN UNITY INVESTMENTS
AUSTRALIAN UNITY INVESTMENTS 28
AUIBL
means Australian Unity Investment Bonds Limited (AUIBL)
ABN 83 087 649 072, AFS Licence No. 234456.
AUI
means Australian Unity Investments, which refers to
the investment management business of the Australian
Unity Group and comprises the following entities:
Australian Unity Funds Management Limited, Australian
Unity Property Limited, Australian Unity Finance Limited,
Australian Unity Retirement Living Investments Limited
and Australian Unity Investment Bonds Limited.
Benefit Fund Rules
means the relevant Schedule of the AUIBL Constitution,
which established each Fund and as amended from time
to time.
Capital Guarantee
means that initial and subsequent contributions and annually
declared bonuses (net of fees and taxes) are guaranteed to
be paid by AUIBL on or after the selected maturity date or
death of the life insured.
Corporations Act 2001
means the Corporations Act 2001 (Cth) and Corporations
Regulations 2001 as amended from time to time.
Funds
means those funds offered under this PDS:
AUI Capital Guaranteed Bond
AUI Capital Guaranteed Mortgage Bond
AUI Conservative Growth Bond
AUI Balanced Growth Bond
AUI High Growth Bond
GST
means Goods and Services Tax.
ITC
means Input Tax Credits.
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Melbourne Business Day
means any day in which Australian banks are open for
business in Melbourne excluding a Saturday and Sunday.
Policy Owner
means the registered holder of the Policy.
Unit
means an undivided beneficial interest in a Fund, the value
of which is calculated in accordance with the Benefit Fund
Rules.
GLOSSARY
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Submitting your application without the assistance of a fi nancial adviserIf you are submitting this application form directly, without having consulted with a fi nancial adviser, you must submit certifi ed copies of your identifi cation documents with the application form. The required identifi cation documents are set out on page 3.
Please take your time to complete the application form, ensuring that all of the required information is included, or we may not be able to process this application.
Incomplete applicationsThere may be instances where we do not receive suffi cient information from you. Where this happens, we will contact you to request the necessary information. Any delay in providing the necessary information may result in you receiving a diff erent unit price than you expected. We recommend you carefully complete the application form and use the ‘How to apply’ on page 2 and ‘Application form checklist’ on page 4 to ensure that you provide all of the required information. If you require assistance with completing the application form, please call us on 13 29 39.
If your application is incomplete and if the additional information is not provided on request, we may return the application and your application monies to you.
Certifi cation of documentsWhere your identifi cation documents need to be certifi ed, we suggest that the person certifying the document(s) for you use the following statement on the copy being certifi ed:
‘I certify this to be a true copy of [name of document] the original of which, was produced to me at the time of signing’.
The document must also be dated, and have the signature, printed name, occupation, employer and address of the person certifying the document.
Some persons who may certify copies of original documents are:
Offi cer with or authorised representative by an Australian Financial
Services licence holder with 2 or more years of continuous service with one or more licensees
Chartered Accountant, CPA or member of the National Institute
of Accountants with 2 or more years of continuous membership
Offi cer of a fi nancial institution or fi nance company with 2 or more
year continuous service with one or more institutions or companies
Permanent employee of the Australian Postal Corporation with
2 or more years continuous service, or someone who operates as an agent of the Australian Postal Corporation
Police Offi cer
Lawyer, magistrate, registrar of a Court, Justice of the Peace
Notary Public
Investment BondsApplication Form – 12 December 2007
Australian Unity Investments - Investment Bonds 1
Completing the application formAnti-money laundering legislation has been introduced to help combat money-laundering and fi nancing terrorism. This requires signifi cant changes to the information we are required to collect from investors. If you are applying through a fi nancial adviser, your adviser will assist you in providing the necessary verifi cation documents prior to lodging the application.
If you are submitting your application directly (without the assistance of a fi nancial adviser), please refer below to the information that should be provided with your application.
If you are an existing investor with Australian Unity Investments and are making an additional investment using the same customer name, then you are not required to provide us with verifi cation documents. However, we may, at our discretion, request these documents from you in an eff ort to comply with the new anti-money laundering legislation.
The following information is provided to assist you in completing and lodging the application form.
Completing the application form use a blue or black ballpoint pen
print in BLOCK letters inside the boxes
answer all sections unless otherwise indicated
(if a section does not apply, please indicate using “N/A”)
ensure you sign on page 9
complete the Direct Debit Request details page 11
or if you are paying by cheque, make it payable to:
Australian Unity Investments – <name of investor(s)>
mail your application form, identity documents (where required)
and cheque or direct debit instructions to our Reply Paid address (see ‘Lodgement’).
Signing the application formRead the declaration section carefully before signing the application form. Each signatory to the investment account must sign the application form.
If signed under Power of Attorney, the Attorney must certify
that they have not received notice of revocation of the Power (We require a certifi ed true copy of the Power of Attorney for our reference.)
LodgementYou can send the completed application together with a cheque or your Direct debit request instructions to:
Australian Unity InvestmentsReply Paid 64466South Melbourne VIC 3205 (No stamp required if mailed in Australia)
The application will be considered lodged when it is received in our Melbourne offi ce on a business day*, prior to 3.00 pm.
* A business day is a Melbourne business day on which Australian banks are open for business in Melbourne excluding Saturday and Sunday.
How to apply
2 Australian Unity Investments - Investment Bonds
If you are applying through a fi nancial adviser, your fi nancial adviser will assist you in providing the necessary verifi cation documents. The following verifi cation documents are required if you are submitting your application directly, without the assistance of a fi nancial adviser.
Type of applicant
Your account must be in the name of: Signature(s) required Verifi cation documents required
(in support of this application form)
Individual account The individual E.g. Jane Citizen
The individual’s Certifi ed copy of any of the following that verify your name, date of birth and current address:
Birth Certifi cate
Citizenship Certifi cate
Pension Card
Drivers Licence
Passport
Notice issued by a government body
or utility provider
Joint account Both or all joint applicantsE.g. Jane Citizen and
John Citizen
All joint applicants’
Applying for diff erent types of investment accounts
Australian Unity Investments - Investment Bonds 3
To ensure that we are able to process your application form quickly and effi ciently, please “X” that you have completed all of the following:
Section 1 Investment details – Indicate if you are a new or existing investor (mandatory).
Section 2 Applicant details – Indicate your name and residential address (mandatory).
Section 3 Life insured details – Indicate who's life is to be insured (if diff erent from applicant) (mandatory).
Section 4 Mailing address – Confi rm if your mailing address is diff erent to your residential address.
Section 5 Contact details – Provide contact details of the applicant(s).
Section 6 Investment details – Indicate the amount you wish to invest in a Fund(s) (mandatory).
Section 7 Regular Savings Plan – Indicate the amount and frequency of your Regular Savings Plan (if applicable).
Section 8 Fee option – Choose the Upfront or Deferred contribution fee option.
Section 9 Term – Indicate your elected term for the policy.
Section 10 Benefi ciary Details – Provide details of beneficiaries in the event of death prior to bond maturity.
Section 11 Regular Withdrawal Facility – Indicate the amount and frequency of your Regular Withdrawal Facility (if applicable).
Section 12 Fax instruction – Confirm if you wish to provide transaction details via fax.
Section 13 Annual reports – Indicate if you would like to receive printed copies of Annual Reports.
Section 14 Declaration and investor signature(s) (mandatory)
Individual investors – Provide your signature and date the form.
Joint investors – Provide your signatures and date the form.
Power of Attorney – Provide your signature and date the form. Attach a certified copy of the Power of Attorney. A Justice of the Peace, Solicitor or Notary Public must certify each page of the Power of Attorney. You also need to provide the same type of information requested for an Individual account as it relates to the Attorney named in the application. Should the Power of Attorney document not contain a sample of the Attorney's signature, please also provide a certified copy of identification documents for the Attorney, containing a sample of their signature, e.g. Driver's Licence, Passport, etc.
Section 15 Adviser arrangements – This section is to be completed by your financial adviser. If you are not using the services of a financial adviser, please leave blank.
Application form checklist
4 Australian Unity Investments - Investment Bonds
Australian Unity Investments - Investment Bonds 5
Please use BLOCK letters and a black or blue pen to complete this application form.
Please indicate using an “X” where appropriate. If a section does not apply to you, please indicate using “N/A”. Reference Number 5 0 1 Offi ce use only
1. Investment details
New investor: Are you a new investor with Australian Unity Investments?
Yes – Go to Section 2 and complete all details
No – See belowExisting investor:
Initial investment
Additional investment
Existing account number
Existing account name
If any of your details have changed please provide them below, otherwise go to Section 6.
2. Applicant(s) details
Applicant 1
Title Mr Mrs Ms Miss Date of birth / /
Surname
Given name(s)
Occupation
Country of residence (if outside Australia)
Applicant 1 residential address (not a P.O. Box)
Unit Street Number
Street name
Suburb State
Postcode Country
(if not Australia)
Australian Unity Investments – Investment BondsApplication Form – 12 December 2007
Applicant 2
Title Mr Mrs Ms Miss Date of birth / /
Surname
Given name(s)
Occupation
Country of residence (if outside Australia)
Applicant 2 residential address (not a P.O. Box)
Unit Street Number
Street name
Suburb State
Postcode Country
(if not Australia)
3. Life insured details (only if diff erent from applicant(s))
Title Mr Mrs Ms Miss
Surname
Given name(s)
Relationship to Applicant(s) Date of birth / /
4. Mailing address
Same as Investor 1 residential address/business address or Same as Investor 2 residential address
Otherwise complete mailing address details below.
Unit Street Number P.O. Box
Street name
Suburb State
Postcode Country
(if not Australia)
5. Contact details
Phone
(after hours) Phone
(business hours)
Mobile Facsimile
6 Australian Unity Investments - Investment Bonds
6. Investment details
Minimum initial investment is $1,000 per Fund. Minimum additional investment is $500 per Fund.
AUI Capital Guaranteed Bond $ , , .
AUI Capital Guaranteed Mortgage Bond $ , , .
AUI Conservative Growth Bond $ , , .
AUI Balanced Growth Bond $ , , .
AUI High Growth Bond $ , , .
Payment Method: Cheque (Make cheques payable to: Australian Unity Investments – <name of investor> and crossed 'Not Negotiable’.)
Direct Debit (Please complete the Direct Debit Request on page 11 of the application form.)
7. Regular savings plan
Please tick if you wish to participate in the regular savings plan. (Please complete the Direct Debit Request on page 11 of the application form.)
Investment amount Regular Savings PlanRegular savings plan (Minimum is $100/month.) Please tick the frequency of payments for your
AUI Capital Guaranteed Bond $ , , . Monthly Quarterly Half-yearly Yearly
AUI Capital Guaranteed Mortgage Bond $ , , . Monthly Quarterly Half-yearly Yearly
AUI Conservative Growth Bond $ , , . Monthly Quarterly Half-yearly Yearly
AUI Balanced Growth Bond $ , , . Monthly Quarterly Half-yearly Yearly
AUI High Growth Bond $ , , . Monthly Quarterly Half-yearly Yearly
8. Fee Option
Upfront contribution fee Deferred contribution fee (Pay contribution fees later.)
The Upfront contribution fee option will apply if no election is made.
9. Term
I/We elect a term of (Minimum of 10 years, maximum of 40 years.)
I/We understand that if I/we do not elect a term the policy will automatically mature in 40 years (the maximum term of a policy).
10. Benefi ciary Details
Pursuant to the provisions of the Life Insurance Act 1995 and the Rules, I/we hereby that upon my/our death, all monies or any other benefi taccrued on, or due in respect of, the benefi t applied for on the Australian Unity Investment Bond Application Form, to which I am/we are entitledare to be paid as set hereunder:
Please note: If the policy is jointly owned there is no need to complete this nomination. In the event of death, the surviving owner assumes fullpolicy ownership. If the life insured is diff erent to the policy owner, the benefi ciary nomination is not eff ective. In the event of death of the lifeinsured, the benefi t is payable to the policy owner.
Benefi ciary 1's details
Benefi ciary 1's full name % of benefi t
payable
Relationship to Applicant(s) Date of birth / /
Australian Unity Investments - Investment Bonds 7
Benefi ciary 2’s details
Benefi ciary 2’s full name % of benefi t
payable
Relationship to Applicant(s) Date of birth / /
Benefi ciary 3’s details
Benefi ciary 3’s full name % of benefi t
payable
Relationship to Applicant(s) Date of birth / /
Benefi ciary 4’s details
Benefi ciary 4’s full name % of benefi t
payable
Relationship to Applicant(s) Date of birth / /
11. Regular Withdrawal Facility
Please tick if you wish to participate in the Regular Withdrawal Facility.
Withdrawal amount (Minimum Regular Withdrawal amount is $500 per month.) Please tick the frequency of withdrawals from your
AUI Capital Guaranteed Bond $ , , . Monthly Quarterly Half-yearly Yearly
AUI Capital Guaranteed Mortgage Bond $ , , . Monthly Quarterly Half-yearly Yearly
AUI Conservative Growth Bond $ , , . Monthly Quarterly Half-yearly Yearly
AUI Balanced Growth Bond $ , , . Monthly Quarterly Half-yearly Yearly
AUI High Growth Bond $ , , . Monthly Quarterly Half-yearly Yearly
Please withdraw from my investment as detailed above and deposit the amount via direct credit in the following account:
Name and address of your Australian Bank, Building Society, Credit Union or CMT account where account is held
Name of Financial Institution
Branch name
Name of account holder(s)
Branch number (BSB) – Account number
I/We acknowledge that direct deposits not accepted by my/our Australian Bank, Building Society, Credit Union or CMT will be reinvested.
12. Fax Instructions
Do you wish to provide account transaction instructions via fax?
Yes No
13. Annual reports
Annual reports are available from our website at www.australianunityinvestments.com.au. If you wish to receive a printed copy of the annual report(s), please indicate using an ‘X’ below.
8 Australian Unity Investments - Investment Bonds
14. Declarations
I/We hereby apply for membership of the relevant Fund.
I/We agree to be bound by the terms and conditions of the attached Australian Unity Investments – Investment Bonds PDS dated 1July 2006
and the relevant Fund’s Benefi t Fund Rules, which may be amended from time to time.
I/We acknowledge that neither Australian Unity Investment Bonds Limited, any appointed investment managers nor any member of the
Australian Unity Group guarantee the performance of the Funds, nor any return of capital other than as disclosed in the PDS dated 1 July 2006.
I/We acknowledge that monies invested in a Fund do not represent investments in Australian Unity Investment Bonds Limited, nor with any
member of the Australian Unity Group and are subject to investment risk.
I/We have read and understood the PDS dated 1 July 2006. If I/we have obtained the PDS dated 1 July 2006 through electronic means,
then I/we declare that I/we received a printout, which comprises the whole PDS and the Application Form before making an application.
I/We acknowledge that Australian Unity Limited and its related bodies corporate may off er goods and services appropriate for my needs and
interests (a current sample of which appears on the back cover of this PDS). I/We consent to my information being disclosed between those entities, and to its use for direct marketing (subject to my right of opt-out), product management and development and for other related purposes.
I/We authorise Australian Unity Investment Bonds Limited to give information relating to my/our account and investment in that account to
my/our adviser whose stamp appears on the Application Form.
I/We acknowledge that if this application is signed under a Power of Attorney, the Attorney verifi es that no notice of revocation of that power
has been received at the date of completing this application.
I/We acknowledge that all of the information provided in this application form is complete and accurate to the best of my/our ability/abilities.
I/We will provide any supporting or additional information which might be required in order to process this application, or subsequently,
as a consequence of my holding units in the Fund.
I/We have no reason to suspect that the monies used to fund this application, or any subsequent contributions into the Fund, is or will be
derived from or related to any money laundering, terrorism fi nancing or other illegal activities.
Signature of Applicant 1(Legal representative, parent or guardian if applicant is under 16 years.)
Signature of Applicant 2(Legal representative, parent or guardian if applicant is under 16 years.)
Investor signature X
Investor signature X
Date / / Date / /
Witness Signature(Required if section 10 – Benefi ciary details completed.
Nominations are only valid if witnessed by an independent party i.e. other than the applicant/member and benefi ciary(s)).
X
Date / /
Legal Representative/Parent/Guardian Details
Title Mr Mrs Ms Miss Date of birth / /
Surname
Given name(s)
Phone
(business hours) Mobile Phone
Country of residence (if outside Australia)
Australian Unity Investments - Investment Bonds 9
Complete all relevant sections below as incomplete applications may not be accepted.
Please use BLOCK letters and a black or blue pen to complete this application form. Please indicate using an “X” where appropriate. If a section does not apply to you, please indicate using “N/A”. Reference Number 5 0 2 Offi ce use only
1. Investor Details
Title Mr Mrs Ms Miss
Surname
Given name(s)
Unit Street Number
Street name
Suburb State
Postcode Country
(if not Australia)
Phone
(business hours) Mobile Phone
2. Initial Terms of the Arrangement
Initial investment by direct debit to be deducted at time of application.
Regular Savings Plan direct debits to commence from 1 5 / / until further notice in writing.
(Regular direct debits will commence the month following your initial investment.)
Frequency of direct debits: Monthly Quarterly Half yearly Yearly
3. Details of your Australian Bank, Building Society, Credit Union or CMT account
Name and address of your Australian Bank, Building Society, Credit Union or CMT account where account is held
Name of Financial Institution
Branch name
Name of account holder(s)
Branch number (BSB) – Account number
Australian Unity Investments - Investment Bonds 11
Australian Unity Investments – Investment BondsDirect Debit Request (DDR) – 12 December 2007
4. Your Authorisation
I/We request Australian Unity (User ID 001721, User ID 063678 or User ID 253816) to debit funds from my/our nominated account according
to the details specifi ed above.
I/We have read and understand the Australian Unity Direct Debit Request (DDR) Service Agreement on page 27 of the Investment Bonds
Product Disclosure Statement dated 1 July 2006.
Signature of Applicant 1
X
Date /
/
Signature of Applicant 2(If joint Account)
X
Date /
/
If debiting from a joint account all signatures are required.
12 Australian Unity Investments - Investment Bonds