BOCSUPER · PDF file1 BOC SuPer ANNuAL rePOrT 2015 Year in review BOC Super Trustee Board...

Issued by BOC Superannuation Pty Ltd ABN 83 080 598 821, AFS Licence No 287131 as Trustee of the BOC Gases Superannuation Fund ABN 49 620 344 668 (BOC Super). MySuper Authorisation number 49620344668116.

BOCSUPER

1 BOC SuPer ANNuAL rePOrT 2015

Year in reviewBOC Super Trustee Board

Frederick Lee

Graeme Bartram, Chairman

Bruce Currie

Christine KaticWarwick Webb

John Coyne

Welcome to the Annual report for members of BOC Super which covers our activities for the year to 30 June 2015. The past year was successful for the Fund and included a number of enhancements to benefit members.

Strong investment performance 2014/15 was another strong year of investment returns for BOC Super despite the many global economic events that have made the headlines. The financial year ending 30 June 2015 delivered strong positive absolute returns for all the Fund’s investment options, with the High Growth Super option returning 9.2%*. The longer-term returns are all similarly strong and members have been well rewarded with a five-year average return for the High Growth option of 9.9% per year*.

Enhancements to Pension optionsMeeting the needs of superannuation members in retirement is a big issue being faced by superannuation funds today. BOC Super’s Trustee Board and Investment Committee, in conjunction with its investment consultant, JANA, have been working to review the existing Pension investment options to ensure they meet the objectives and needs of our members during their retirement.

Some changes have already been made, such as restructuring the global shares asset class and introducing more alternative investments. Further changes will be made in the second half of 2015 to appoint new specialist managers and adjust the asset allocation for the Pension options. These changes are designed to enhance the investment outcome for Pension members through more effective tax management (to take advantage of the zero tax that applies to pension investments), and to produce more consistent, less-volatile returns.

Helping you plan for the futureSuper isn’t always easy to understand. The Trustee has launched a number of initiatives to help make super a bit easier and encourage all members to more actively plan for their future.

Retirement Simulator proving popular

During the year, we launched a new retirement Simulator which is proving to be a helpful retirement planning tool for members. You can project your superannuation balance over time to see your potential retirement income (including the Age Pension). You can also see how long your superannuation assets might last once you have stopped working. The retirement Simulator is available when you login to your account online. For more information, see our video or contact the BOC Super Helpline on 1300 136 829.

* Investment returns for Super members are net of investment fees and tax and indirect costs.

BOC SuPer ANNuAL rePOrT 2015 2

Financial advice about your super

BOC Super now offers you FREE limited financial advice about your BOC Super account. All you need to do is call the BOC Super Helpline on 1300 136 829. If your requirements are complex, you can choose to pay for comprehensive advice. Fees for super-related advice can be paid from your BOC Super account.

Helping you learn more

Our new video series is already proving popular. These videos are designed to help make super easier to understand. The short videos feature Allan Murphy, BOC’s General Manager, Superannuation, explaining some important aspects of super including investments, retirement planning and insurance. You can find a link to the videos on the BOC Super website at www.bocsuper.com.au.

Easy rollovers

It is also great to see that members are using our new rollover tool to consolidate their super and save on fees and excess paperwork. rollovers generally happen within 48 hours. To access the tool, simply login to your account. Before moving your super, check if your other fund charges fees to move or if you will lose any important benefits like insurance. For more information, see our video via www.bocsuper.com.au.

In closing We encourage you to spend some time reading this report to understand how the past year has affected the Fund and your super. As Trustee, our role is to manage the Fund for your benefit. As always, we welcome your questions and feedback. See the back cover for our contact details.

The Directors BOC Super


A number of economic events have kept markets in the headlines over the last 12 months, including developments in Greece and weaker growth in China. These issues came to a head in the last quarter of the financial year and the Australian share market finished the year with a negative quarter. However despite the volatility, over the year as a whole, markets have generally delivered good returns, especially in global shares, and members have seen another year of solid investment returns.

Australia’s economy continued to grow, but at a pace that the rBA has described as ‘below trend’. Conditions differ from a normal business cycle, with numerous signs that the post ‘mining boom’ transition of the Australian economy could be challenging. Partly offsetting the downturn in mining investment, housing construction has recently seen strong growth while consumer spending has also increased. The rBA reduced the cash rate on two occasions in the second half of the financial year. The lower rates have clearly contributed to the sharp rise in dwelling prices in some of Australia’s major cities.

The uS and uK have been the most resilient of the developed economies in terms of economic growth and are expected to be the first countries to begin lifting interest rates.

Conditions in the eurozone and Japan are showing early signs of improving but it is occurring slowly, underpinning the ongoing need for their respective Quantitative easing programs. Ongoing issues in Greece create risks that the eurozone’s growth recovery will falter. economic growth in most Asian markets continues at a reasonable pace. Growth in China has slowed more than expected, requiring policy stimulus measures such as lower interest rates and fewer restrictions on bank lending.

The MSCI World ex-Australia index (the benchmark for global share market returns) achieved 11.6% on a hedged basis (in $A) over the year, while unhedged returns ($A) were much higher at 25.9% for the year as the Australian dollar depreciated against major overseas currencies, particularly against the uS Dollar and Pound Sterling.

It was a volatile year for Australian shares but over the whole period the S&P/ASX300 Index returned 5.6%. The energy and Materials sectors underperformed other sectors of the Australian market. A low interest rate environment and increased volatility drove investors into high yielding and defensive sectors of the Australian market. As such, the best performing sectors were Health Care and Telecoms.

In the Property sector, Australian real estate Investment Trusts (AreITs) generated a very strong return (20.2%), with performance primarily driven by investors searching for yield. Australian unlisted property trusts are expected to generate more stable returns over the medium term but also provided around 9% over the financial year.

Interest rates remained at historically low levels around the globe for much of the year as the priority for many countries and regions was to provide much needed economic stimulus, especially in europe. Inflation-linked bonds (6.4%) and hedged global government bonds (6.2%) provided the best returns in this asset class, while Australian government bonds (5.8%) also performed well.

Markets are anticipating uS interest rates will rise in late 2015. While this interest rate risk has already been priced into the markets, the impact remains difficult to gauge with certainty. There is concern that share market valuations rest on the tenuous foundations of ultra-low interest rates. Slower growth in China has important consequences for Australia, especially at this more vulnerable point in the commodity price cycle. economic growth in europe and Japan is modest at best and volatility continues to be high as Greece continues on the brink of potential exit from the eurozone.

The current investment environment is a particularly challenging one. BOC Super’s Trustee Board and Investment Committee remain committed to closely monitoring the risks and opportunities presented by the difficult environment and adjusting the portfolios accordingly, in order to help deliver a consistent long-term return for members.Note: This investment commentary does not constitute advice. All investment figures quoted in this market review relate to before-tax performance of the relevant industry benchmark.

Market review


Your super investments – an overviewInvestment policyBOC Super has an Investment Governance Framework which sets the investment strategy and objectives for the Fund and its investment options as well as benchmarks for monitoring the Fund’s performance. It helps ensure that BOC Super gets strong investment returns for you. The Investment Governance Framework also covers details like the appointment of investment managers and guidelines for investing in futures and options.

How your investment returns are calculatedThe crediting rate depends on the investment performance of the investment option(s) in which your account is invested, and is determined from the net investment earnings of each option after deducting investment-related fees and indirect costs (and tax, where applicable). Crediting rates are calculated weekly to enable pricing of contribution receipts and benefit payments. These weekly rates are used to calculate the benefit values shown in your personal account pages on the Fund’s website.

ReservesThe Trustee does not maintain investment reserves. However, it does maintain an operational risk financial requirement (OrFr) reserve. From 1 July 2013, super funds have been required to set aside financial resources to address the fund’s operational risks.

A reserve of 0.25% of the Fund’s total assets has been set aside out of the defined benefit assets for this purpose.

The Trustee has decided that the OrFr reserve will be invested in the same way as the Fund’s defined benefit assets, which are currently invested in the High Growth Super option. The reserve is monitored periodically by the Trustee to ensure that it remains at this level

Level of reserves

As at 30 June

ORFR reserve% of total Fund assets

2015 0.25%2014 0.25%2013 n/a


Tax creditsThe Fund must pay tax on its investment income, apart from income earned in respect of Pension members which is tax free. The tax payable on the Fund’s investment income is complicated. It depends on how much the Fund receives from different sources, such as company dividends, interest paid on bonds and capital gains and losses that occur when investments like shares are bought and sold.

For the High Growth Super option, the overall tax payable in any Fund year can only be calculated accurately three or four months after the end of each year, when the Fund’s annual accounts and tax return are prepared. When setting the Fund’s crediting rates and prices each week for High Growth Super option members, the Trustee must make advance allowance for the tax that will be paid on their investment income. To do this, the Trustee makes an estimate of the tax that will apply for the High Growth Super option.

In any Fund year, the actual tax payable on the High Growth Super option investment income will normally turn out to be a little higher or lower than the estimated tax included in weekly crediting rates. Once the actual tax payable is known, an adjustment is then made to take account of the difference between the estimated and actual tax. This adjustment is made during the following Fund year.

For the other options, tax is payable (or tax credits received where applicable) on investment income and applied to weekly crediting rates on an ongoing basis by the investment manager.

Who manages your investments?During the year to 30 June 2015, the Trustee used a number of professional investment managers to manage BOC Super’s assets. In order to gain cost-effective, efficient and risk-controlled access to sector specialist managers and investment advice, the Trustee has appointed JANA Investment Advisers Pty Ltd (‘JANA’) as BOC Super’s investment consultant. JANA oversees the management of a considerable portion of BOC Super’s assets through the JANA implemented consulting platform. In order for JANA to provide its implemented asset consulting service, the Trustee invests in JANA Investment Trusts and MLC Corporate Investment Policies.

Environment, Social and Governance (ESG) issuesThe Trustee has long been conscious of how eSG issues can make a difference to the performance of individual companies and, therefore, to the investment returns achieved by the Fund through shareholdings in those companies. With assets invested through the underlying managers within the JANA trust structure, there is currently no opportunity to screen shareholdings. The Trustee has concluded, however, that appropriate consideration of eSG matters is being given by the managers making day-to-day investment decisions which affect BOC Super assets.


Investment managers/products as at 30 June#

2015 2014JANA Core Australian Shares 14.4% 16.2%JANA High Alpha Australian Shares 4.7% 5.3%JANA Passive Australian Shares (Vanguard) 4.0% 4.6%JANA Core Global Shares 7.0% 9.1%JANA High Alpha Global Shares 6.7% 8.7%JANA Passive Global Shares (Vanguard) 4.8% 5.1%JANA Small Caps Australian Shares 0.6% 0.6%JANA emerging Markets 2.7% 3.0%JANA Pension Global Shares 3.3% –JANA Listed Property 3.0% 3.4%JANA unlisted Property 7.6% 7.0%AMP Alternative Assets 3.4% 3.0%JANA Growth Alternatives unit 5.2% 5.0%Blackrock efficient Beta Strategy 0.3% –Low Correlation Strategy 4.4% –JANA Triplepoint – 2.6%JANA Absolute return unit – 1.4%Shenkman Global Bank Loans 4.7% 3.8%JANA Diversified Fixed Interest 8.0% 7.9%JANA Cash 15.2% 13.3%Total 100.0% 100.0%

# Holdings under 0.25% have not been shown.

Specialist investment managersFollowing are the specialist investment managers used by JANA within various sectors as at 30 June 2015.

Domestic sharesBeM, Concise, Fidelity, Solaris, Cooper, ubique, BT, Invesco, Paradice, Fairview, Vanguard

International sharesAcadian, Schroders, Janus, Baillie Gifford, Carnegie, Harding Loevner, Pzena, Tweedy Browne, Walter Scott, Delaware, Neuberger Berman, Vanguard

Bonds Franklin Templeton, GIGC, PIMCO, uBS, GAr

PropertyAMP, DeXuS, CharterHall, Morgan Stanley, resolution, SG Hiscock

AlternativesShenkman, Low Correlation Strategy, JANA Growth Alternatives, Blackrock

CashAntares

Our policy on derivativesAs it is not the policy of the Trustee to directly invest the assets of the Fund, the Trustee would not directly invest in derivatives. external investment managers may utilise derivatives in managing investment portfolios for the Trustee and in managing pooled investment vehicles in which the Trustee invests.

No investment manager is permitted to use derivatives (e.g. futures contracts, forward transactions and options) to an extent greater than the total value of the assets they manage. Derivatives may be used provided this is in accordance with investment management agreements between JANA and its appointed managers. The management and use of derivatives directly by the underlying managers in the JANA Trusts is governed by the managers’ Derivative risk Statements or other risk management processes.


Super membersNote that past performance is not necessarily a reliable indicator of future performance.

High Growth (default option)# Aggressive Growth Low Growth Cash

Net return for Super members 2014/15*

9.2% 11.4% 5.9% 2.4%

Investment strategy

Aims to deliver a high level of long-term return, within a portfolio invested across a diverse mix of assets and markets, including shares, property, alternative assets and bonds.

Aims to deliver the maximum possible long-term return, by accepting increased volatility in returns over the short to medium term. It is potentially invested in fewer markets than the other diversified options and has a very high exposure to Australian and international share markets.

A substantially more defensive option than the High Growth option, although it aims to deliver higher long-term returns than the Cash option with commensurately higher risk. It is also invested across a diverse mix of assets and markets, including shares, property and bonds.

Aims to preserve capital after fees, and match the return of the bank bill index (the common measure of the institutional cash rate). It offers minimal scope of positive returns after inflation.

Investment objective

To earn a rate of return (net of tax and investment fees) of CPI + 4% per annum over rolling 10-year periods with the potential for a negative return once in every 4 years (5 times in 20 years).

To earn a rate of return (net of tax and investment fees) of CPI + 5% per annum over rolling 10-year periods, with the potential for a negative return once in every 3 years (7 times in 20 years).

To earn a rate of return (net of tax and investment fees) of CPI + 1% per annum over rolling 3-year-periods, with the potential for a negative return once in every 10 years (twice in 20 years).

To earn a positive rate of return (net of tax and investment fees) over rolling 1-year periods, with negligible chance of a negative annual return (perhaps one half in 20 years).

Risk profile High Very high Medium Very low

Minimum suggested investment horizon

10 years 10 years 3 years –

Investment mix as at 30 June 2015(figures in brackets show investment mix as at 30 June 2014. See page 8 for key.)

Net returns for Super members for periods ending 30 June 2015*

# The High Growth option is the investment option for MySuper members.

* All rates are net of tax, investment fees and indirect costs.

** Option commenced on 1 October 2006.

How the investment options performed

Year Return2015 9.2%2014 14.2%2013 18.4%2012 -0.7%2011 9.4%5-year compound average (per year)

9.9%

10-year compound average (per year)

6.1%

Year Return2015 11.4%2014 16.8%2013 20.8%2012 -2.4%2011 8.2%5-year compound average (per year)

10.7%

Compound average since 1 October 2006 (per year)**

4.2%

Cash

Diversi�ed �xed interest

Defensive alternatives

Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

� Australian shares � International shares � Property – unlisted � Property – listed� Growth alternatives � Defensive alternatives � Diversified fixed interest � Cash

Super members

25.5%(28.4%)

25.7%(27.4%)6.8%

(7.2%)

4.5%(3.8%)

10.8%(9.5%)

9.8%(8.6%)

6.6%(7.1%)

10.3%(8.0%)

AggressiveHIgh growth

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

36.3%(40.9%)

42.6%(37.1%)

6.5%(7.0%)

4.4%(3.8%)

5.4%(6.9%)

4.8%(4.3%)

Conservative

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

8.3%(9.3%)

8.8%(7.6%)

6.1%(6.8%)

4.1%(3.7%)

5.3%(6.6%)

8.9%(9.4%)

25.4%(24.7%)

33.1%(31.9%)

Cash

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

100%(100%)


Super membersNote that past performance is not necessarily a reliable indicator of future performance.

High Growth (default option)# Aggressive Growth Low Growth Cash

Net return for Super members 2014/15*

9.2% 11.4% 5.9% 2.4%

Investment strategy



A substantially more defensive option than the High Growth option, although it aims to deliver higher long-term returns than the Cash option with commensurately higher risk. It is also invested across a diverse mix of assets and markets, including shares, property and bonds.



To earn a rate of return (net of tax and investment fees) of CPI + 4% per annum over rolling 10-year periods with the potential for a negative return once in every 4 years (5 times in 20 years).

To earn a rate of return (net of tax and investment fees) of CPI + 5% per annum over rolling 10-year periods, with the potential for a negative return once in every 3 years (7 times in 20 years).

To earn a rate of return (net of tax and investment fees) of CPI + 1% per annum over rolling 3-year-periods, with the potential for a negative return once in every 10 years (twice in 20 years).

To earn a positive rate of return (net of tax and investment fees) over rolling 1-year periods, with negligible chance of a negative annual return (perhaps one half in 20 years).





Net returns for Super members for periods ending 30 June 2015*

# The High Growth option is the investment option for MySuper members.

* All rates are net of tax, investment fees and indirect costs.

** Option commenced on 1 October 2006.

Year Return2015 5.9%2014 7.8%2013 8.7%2012 4.7%2011 6.3%5-year compound average (per year)

6.7%


4.3%


3.5%


4.1%

Australian shares International shares Property – unlisted Property – listed Growth alternatives Defensive alternatives Diversified fixed interest Cash

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares


Super members

25.5%(28.4%)

25.7%(27.4%)6.8%

(7.2%)

4.5%(3.8%)

10.8%(9.5%)

9.8%(8.6%)

6.6%(7.1%)

10.3%(8.0%)


Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

36.3%(40.9%)

42.6%(37.1%)

6.5%(7.0%)

4.4%(3.8%)

5.4%(6.9%)

4.8%(4.3%)

Conservative

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

8.3%(9.3%)

8.8%(7.6%)

6.1%(6.8%)

4.1%(3.7%)

5.3%(6.6%)

8.9%(9.4%)

25.4%(24.7%)

33.1%(31.9%)

Cash

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

100%(100%)

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares


Super members

25.5%(28.4%)

25.7%(27.4%)6.8%

(7.2%)

4.5%(3.8%)

10.8%(9.5%)

9.8%(8.6%)

6.6%(7.1%)

10.3%(8.0%)


Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

36.3%(40.9%)

42.6%(37.1%)

6.5%(7.0%)

4.4%(3.8%)

5.4%(6.9%)

4.8%(4.3%)

Conservative

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

8.3%(9.3%)

8.8%(7.6%)

6.1%(6.8%)

4.1%(3.7%)

5.3%(6.6%)

8.9%(9.4%)

25.4%(24.7%)

33.1%(31.9%)

Cash

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

100%(100%)


Pension membersNote that past performance is not necessarily a reliable indicator of future performance.

Moderate (default option)** Aggressive Conservative Cash

Net return for Pension members 2014/15*

10.3% 12.4% 6.7% 2.8%

Investment strategy



A substantially more defensive option than the Moderate option, although it aims to deliver higher-term returns than the Cash option with commensurately higher risk. It is also invested across a diverse mix of assets and markets, including shares, property and bonds.



To earn a rate of return (net of investment fees) of CPI + 3.5% per annum over rolling 10-year periods, with the potential for a negative return once in every 4 years (5 times in 20 years).

To earn a rate of return (net of investment fees) of CPI + 5% per annum over rolling 10-year periods, with the potential for a negative return once in every 3 years (7 times in 20 years).

To earn a rate of return (net of investment fees) of CPI + 1% per annum over rolling 3-year-periods, with the potential for a negative return once in every 10 years (twice in 20 years).

To earn a positive rate of return (net of investment fees) over rolling 1-year periods, with negligible chance of a negative annual return (perhaps one half in 20 years).





Net returns for Pension members for periods ending 30 June 2015*

* All rates for Pension members are net of investment fees and indirect costs only. ** The Assertive option was revised and renamed the Moderate option on 28 February 2012. *** New options were introduced for Pension members on 21 October 2010. returns before this date were for the Low Growth (now Conservative),

High Growth (then Assertive now Moderate) and Aggressive Growth (now Aggressive) options, net of fees.**** Option commenced on 1 October 2006.

Year Return2015 10.3%2014 15.8%2013 18.3%2012** -0.8%2011*** 9.9%5-year compound average (per year)

10.5%

10-year compound average (per year)

6.6%

Year Return2015 12.4%2014 19.3%2013 23.9%2012 -2.7%2011*** 9.6%5-year compound average (per year)

12.1%

Compound average since 1 October 2006 (per year)****

4.8%

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares


Pension members

26.4%(29.2%)

27.5%(31.7%)6.1%

(6.1%)

4.0%(4.1%)

3.9%(2.0%)

9.9%(6.8%)

10.1%(10.0%)

12.1%(10.1%)

AggressiveModerate

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

42.0%(41.5%)

40.6%(42.2%)

5.5%(5.8%)

3.7%(3.9%)

3.0%(1.7%)

5.2%(4.9%)

Conservative

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

7.8%(9.7%)

8.9%(11.2%)

6.3%(5.9%)

4.1%(4.0%)

3.7%(2.1%)

8.9%(6.9%)

26.1%(26.4%)

34.2%(33.8%)

Cash

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

100%(100%)

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares


Pension members

26.4%(29.2%)

27.5%(31.7%)6.1%

(6.1%)

4.0%(4.1%)

3.9%(2.0%)

9.9%(6.8%)

10.1%(10.0%)

12.1%(10.1%)

AggressiveModerate

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

42.0%(41.5%)

40.6%(42.2%)

5.5%(5.8%)

3.7%(3.9%)

3.0%(1.7%)

5.2%(4.9%)

Conservative

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

7.8%(9.7%)

8.9%(11.2%)

6.3%(5.9%)

4.1%(4.0%)

3.7%(2.1%)

8.9%(6.9%)

26.1%(26.4%)

34.2%(33.8%)

Cash

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

100%(100%)


Pension membersNote that past performance is not necessarily a reliable indicator of future performance.

Moderate (default option)** Aggressive Conservative Cash

Net return for Pension members 2014/15*

10.3% 12.4% 6.7% 2.8%

Investment strategy



A substantially more defensive option than the Moderate option, although it aims to deliver higher-term returns than the Cash option with commensurately higher risk. It is also invested across a diverse mix of assets and markets, including shares, property and bonds.



To earn a rate of return (net of investment fees) of CPI + 3.5% per annum over rolling 10-year periods, with the potential for a negative return once in every 4 years (5 times in 20 years).

To earn a rate of return (net of investment fees) of CPI + 5% per annum over rolling 10-year periods, with the potential for a negative return once in every 3 years (7 times in 20 years).

To earn a rate of return (net of investment fees) of CPI + 1% per annum over rolling 3-year-periods, with the potential for a negative return once in every 10 years (twice in 20 years).

To earn a positive rate of return (net of investment fees) over rolling 1-year periods, with negligible chance of a negative annual return (perhaps one half in 20 years).





Net returns for Pension members for periods ending 30 June 2015*

* All rates for Pension members are net of investment fees and indirect costs only. ** The Assertive option was revised and renamed the Moderate option on 28 February 2012. *** New options were introduced for Pension members on 21 October 2010. returns before this date were for the Low Growth (now Conservative),

High Growth (then Assertive now Moderate) and Aggressive Growth (now Aggressive) options, net of fees.**** Option commenced on 1 October 2006.

Year Return2015 6.7%2014 9.4%2013 9.7%2012 5.3%2011*** 7.7%5-year compound average (per year)

7.8%


4.9%


4.1%


4.8%

Australian shares International shares Property – unlisted Property – listed Growth alternatives Defensive alternatives Diversified fixed interest Cash

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares


Pension members

26.4%(29.2%)

27.5%(31.7%)6.1%

(6.1%)

4.0%(4.1%)

3.9%(2.0%)

9.9%(6.8%)

10.1%(10.0%)

12.1%(10.1%)

AggressiveModerate

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

42.0%(41.5%)

40.6%(42.2%)

5.5%(5.8%)

3.7%(3.9%)

3.0%(1.7%)

5.2%(4.9%)

Conservative

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

7.8%(9.7%)

8.9%(11.2%)

6.3%(5.9%)

4.1%(4.0%)

3.7%(2.1%)

8.9%(6.9%)

26.1%(26.4%)

34.2%(33.8%)

Cash

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

100%(100%)

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares


Pension members

26.4%(29.2%)

27.5%(31.7%)6.1%

(6.1%)

4.0%(4.1%)

3.9%(2.0%)

9.9%(6.8%)

10.1%(10.0%)

12.1%(10.1%)

AggressiveModerate

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

42.0%(41.5%)

40.6%(42.2%)

5.5%(5.8%)

3.7%(3.9%)

3.0%(1.7%)

5.2%(4.9%)

Conservative

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

7.8%(9.7%)

8.9%(11.2%)

6.3%(5.9%)

4.1%(4.0%)

3.7%(2.1%)

8.9%(6.9%)

26.1%(26.4%)

34.2%(33.8%)

Cash

Cash



Growth alternatives

Property - listed

Property - unlisted

Overseas shares

Australian shares

100%(100%)


Looking after your superThe TrusteeYour Fund is run by a Trustee company, BOC Superannuation Pty Ltd, in line with its governing legal document, the Trust Deed, and super laws. There are six Directors in the Trustee Company – three elected by you, the members of BOC Super, and three appointed by BOC Limited. There is also a superannuation manager who is appointed by BOC Limited.

Directors of the Trustee as at 30 June 2015Company-appointed Directors

Graeme Bartram (Chairman)Bruce CurrieFrederick Lee

Member-elected Directors

John CoyneChristine KaticWarwick WebbThere were no changes to Directors during the year.

General Manager, Superannuation

Allan Murphy

Superannuation Operations Manager

Nathan Bell

The Trust DeedThe Trust Deed is the governing document of the BOC Fund. No changes were made to the Trust Deed during the year.

Trustee insurance protectionThe Trustee has indemnity insurance covering it for any loss suffered in exercising its power and duties as Trustee, other than where the loss is because of dishonest acts or intentional or reckless failure to exercise due care and diligence.

BOC Super’s advisers The table below shows the specialist advisers who help run BOC Super.

Investment consultant JANA Investment Advisers Pty Ltd Master custodian of assets National Australia Bank Asset Service Auditor ernst & YoungInternal auditor Dymond, Foulds & VaughanAdministrator Mercer Outsourcing (Australia) Pty Ltd*Legal advisers Mercer Legal Pty Ltd

Holding redlichActuary Towers Watson Australia Pty LtdRisk and compliance consultant

Professional Financial Solutions

Communications Towers Watson Australia Pty Ltd* The BOC Super Helpline is operated by Mercer Outsourcing (Australia) Pty Ltd AFSL No. 411980

and Mercer Financial Advice (Australia) Pty Ltd AFSL No 411766.


Don’t want to be ERFed?If we lose contact with you and don’t have your current address, then we might have to ‘erF’ your super. This means transferring your account from BOC Super to an eligible rollover Fund (erF). An erF is a fund designed for the benefits of members who cannot be located or who do not respond to letters from their superannuation fund.

BOC Super may transfer your benefit to an erF if:

(i) You leave employment with BOC and

a) Your gross benefit is less than $5,000, and

b) We do not receive your response to our request for payment instructions within 90 days of requesting it,

or

(ii) We write to you advising that your benefit will be transferred to an erF unless within the timeframe specified in the notice, you nominate an alternative fund that is eligible to receive the benefit.

A summary of some of the significant features of the erF as at 1 July 2015 is shown below.

The assets of the erF are invested in a capital guaranteed life insurance policy (erF Policy) issued to AMP Superannuation Limited (‘ASL’) by AMP Life Limited (‘AMP Life’). The erF Policy is a ‘participating policy’ in AMP Life’s Number 1 Statutory Fund (‘AMP No 1 Fund’). There is no choice of investment available to members within the erF.

returns are guaranteed never to be negative. For larger account balances (currently over $2,500), the investment objective is to provide returns over the longer term, exceeding those from cash with security of capital.

The investment strategy for the assets in the AMP No 1 Fund (that are backing the erF Policy) is centred on cash and fixed interest investments, supplemented by investments in shares and property to provide long-term growth.

AMP Life declares multi-tiered crediting rates of investment earnings with respect to the erF Policy. The earnings are credited on a member’s daily balance and credited annually (or on withdrawal). Where a member’s account balance is less than $1,000, no earnings are credited.

There are no fees charged directly to an erF member’s account by ASL. AMP Life deducts administration and investment fees as well as taxes (including earnings tax) before declaring any interest to be credited under the erF Policy.

The erF is unable to accept contributions from members or their employers, however, rollovers from other superannuation funds are permitted.

The erF does not provide insurance cover.

You can obtain the erF’s Product Disclosure Statement using the contact details below.

The erF currently nominated by the Trustee is:

AMP Eligible Rollover FundThe AdministratorPO Box 300Parramatta NSW 2124Phone: 131 267Fax: 1300 301 267

SurchargeAny surcharge payments applying are deducted from the relevant members’ accounts.


Enquiries, compliments, complaintsWe’re always happy to help you, so if you have a question about your super account or benefits, please call us on 1300 136 829.

Most enquiries can be dealt with over the phone but you may be asked to put your enquiry in writing. If so, we aim to get back to you within 28 days.

If you have a problem and it isn’t resolved to your satisfaction, you should send a written complaint addressed to BOC Super’s Complaints Officer (see back page for address details). The matter will be investigated and you will be advised of the Trustee’s decision on progress as soon as possible and definitely within 90 days of receiving your complaint. In certain circumstances, you may be able to request the Trustee’s reasons for its decision on your complaint. A copy of the Trustee’s enquiries and Complaints Policy is available from the Fund website.

If you are not happy with the Trustee’s handling of your enquiry or complaint, you may then contact the Superannuation Complaints Tribunal. The Tribunal is an independent body set up by the Federal Government to deal with certain enquiries or complaints that the Trustee has not dealt with to your satisfaction. You can contact the Tribunal on 1300 884 114 or by email to [email protected].

There are some complaints that the Tribunal cannot consider, such as those relating to the management of the Fund as a whole. Time limits also apply to certain complaints relating to total and permanent disability claims and to complaints about objections to the payment of death benefits. If your complaint is in relation to one of these areas, please contact the Helpline or refer to the Tribunal’s website on www.sct.gov.au as soon as possible for further information.

For privacy-related matters, the Office of the Australian Information Commissioner (OAIC) may review your complaint. You can contact OAIC on 1300 363 992.


A summary of BOC Super’s unaudited financial statements for the year ended 30 June 2015 is shown below. The final audited financial statements are expected to be available in October 2015. If you would like a copy of the audited financial statements and the audit report, please call the BOC Super Helpline on 1300 136 829 after that date.

Statement of change in financial position 2014/15 $

Net assets at 30 June 2014 611,485,122

Plus

Net investment revenue 55,862,273

employer contributions 23,599,197

employer reimbursement of expenses –

Member contributions 4,273,907

Transfers from other funds 10,831,045

Insurance proceeds 707,197

Total revenue 95,273,619

Less

Benefits paid 50,507,714

Group life fees 1,011,349

General administration expenses 1,748,613

Total expenses 53,267,676

Income tax expense 3,976,787

Equals


Statement of financial position at 30 June 2015 $

Assets

Investments 636,475,068

Deferred tax assets 9,042,999

Cash at bank 5,174,880

Other assets 98,044

Total assets 650,790,991

Less

Liabilities

Accrued expenses 371,542

Provision for tax 905,171

Total liabilities 1,276,713

Equals


Vested benefits at 30 June 2015 621,219,922

The Fund’s financials

Contact BOC SuperWe’re here to help. If you have any questions about BOC Super, please contact us at:

BOC Gases Superannuation Fund GPO Box 4303 Melbourne VIC 3001 Helpline 1300 136 829 Fax 03 9245 5827 www.bocsuper.com.au

Issued by BOC Superannuation Pty Ltd ABN 83 080 598 821 AFS Licence No 287131 rSe Licence No L0000710 as Trustee of the BOC Gases Superannuation Fund ABN 49 620 344 668 rSe registration No r1000832 MySuper Authorisation number 49620344668116 10 Julius Avenue, North ryde NSW 2113

The information in this document is general information only and does not take into account any person’s individual financial objectives, financial situation or needs. Any examples are included for illustration only and are not intended to be recommendations or preferred courses of action. We recommend that you speak to a financial adviser if you need any specific advice. The value of investments in the investment options may rise and fall from time to time. Neither BOC Superannuation Pty Ltd (Trustee) nor BOC Limited (the Company) guarantees the investment performance, earnings or return of capital invested in BOC Super. The investment returns and objectives outlined in this document are not a forecast or indicative of future performance. Further, past performance is not necessarily an indication of future performance.

Thanks to BOC employee Julie Harris for permission to use her photo in this document.

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