University of Cape Town Retirement Fund Financial Statements - … · 2014. 12. 11. · UNIVERSITY OF CAPE TOWN RETIREMENT FUND SCHEDULE E REPORT OF THE BOARD OF TRUSTEES As at 30

ANNUAL FINANCIAL STATEMENTS

NAME OF RETIREMENT FUND: UNIVERSITY OF CAPE TOWN RETIREMENT FUND

FINANCIAL SERVICES BOARDREGISTRATION NUMBER: 12/8/31582/2

FOR THE PERIOD: 1 July 2013 to 30 June 2014

CONTENTS

Schedule Page Schedule Page

A

B

C

D

E

F

G

Regulatory Information *

Statement of responsibility by theBoard of Trustees *

Statement of responsibility by theprincipal officer *

Report of the independent auditors

Report of the Board of Trustees *

Statement of net assets and funds

Statement of changes in net assetsand funds

1 - 3

4

5

6

7 - 15

16

17

HA

HB

I

IA

IB

Notes to the Annual financialstatements

Report of the Valuator *

Report of the independent auditors tothe Registrar of Pension Funds

Investment schedule pertaining to theannual financial statements *

Assets held in compliance withRegulation 28Report of the independent auditorson compliance with Regulation 28 tothe Registrar of Pension Funds

18 - 35

36

37 - 50

51 - 62

63 - 68

69

* Not subject to any engagement by an auditor

UNIVERSITY OF CAPE TOWN RETIREMENT FUND

SCHEDULE AREGULATORY INFORMATIONfor the year ended 30 June 2014

REGISTERED OFFICE OF THE FUND

Postal address: Private Bag X3Rondebosch7700

Physical address: Bremner Building, Lovers' WalkRondebosch7701

FINANCIAL REPORTING PERIODS

Current year: 1 July 2013 to 30 June 2014Prior year: 1 July 2012 to 30 June 2013

Period 1 January 2014 to 31 December 2014

Full name E-mail Address Capacity Date appointed Date resignedMr H.T. Amoore [email protected] E & C 1 January 2014 N/A

Mr S. Abrahams [email protected] E 1 January 2014 N/A

Mr P. de Jager [email protected] E 1 January 2014 N/A

Ms L. Haddow [email protected] E 1 January 2014 N/A

Dr H. Raubenheimer [email protected]; E 1 January 2014 N/A

Emeritus Professor J. Simpson [email protected] E 1 January 2014 N/A

Ms J. du Toit [email protected] M & DC 1 January 2014 N/A

Ms K. Lehmann [email protected] M 1 January 2014 N/A

Mr D. Munene [email protected] M 1 January 2014 N/A

Professor S. Richardson [email protected] M 1 January 2014 N/A

Mr C. Tobler [email protected] M 1 January 2014 N/A

Mr D. Strugnell [email protected] M 1 January 2014 N/A

Ms M. Tainton [email protected] E/A 1 January 2014 N/A

Professor J. Glazewski [email protected] M/A 1 January 2014 N/A

Period 1 January 2011 to 31 December 2013

Full name E-mail Address Capacity Date appointed Date resignedMr H.T. Amoore [email protected] E & C 1 January 2011 N/A

Associate Professor C. West [email protected] M 1 January 2011 N/A

Professor J.J. Roeleveld [email protected] M & DC 1 January 2011 N/A

Mr M. Mnyani [email protected] E 1 January 2011 N/A

Ms K. Lehmann [email protected] M 1 January 2011 N/A

Emeritus Professor J. Terblanche [email protected] E 1 January 2011 30 June 2012

Professor S. Richardson [email protected] M 1 January 2011 N/A

Ms M. Tainton [email protected] E/A 1 January 2011 N/A

Ms K. Chernotsky [email protected] E 1 January 2011 N/A

Dr H. Raubenheimer [email protected]; E 1 July 2012 N/A

Mr C. Tobler [email protected] M 1 January 2011 N/A

Professor J. Glazewski [email protected] M/A 1 January 2011 N/A

Emeritus Profesor J. Simpson [email protected] E 1 January 2011 N/A

Ms K. Evans [email protected] M 1 January 2011 31 May 2013

Mr D. Strugnell [email protected] M 1 June 2013 N/A

- 'M' denotes member elected- 'E' denotes employer appointed- 'A' denotes alternate- 'C' denotes chairperson- 'DC' denotes deputy chairperson

Governance note: schedule of meetings* held by the Board of Trustees in terms of the Rules of the Fund

Meeting date Place of meeting Quorum

27 September 2013** Mafeje Room, Bremner Building, UCT, Rondebosch No

6 December 2013 Mafeje Room, Bremner Building, UCT, Rondebosch Yes

28 March 2014 Mafeje Room, Bremner Building, UCT, Rondebosch Yes

20 June 2014 Mafeje Room, Bremner Building, UCT, Rondebosch Yes

* Only meetings held by the Board of Trustees and does not include meetings held by the sub-committees.** All decisions taken were subsequently ratified by the Board of Trustees.

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SCHEDULE AREGULATORY INFORMATION (continued)For the year ended 30 June 2014 FUND OFFICERS

Principal officer

Full name Postal address Physical addressTelephonenumber E-mail address Appointed

Ms Olivia van der Hoven Private Bag X3,Rondebosch, 7701

Bremner Buidling, Lovers' Walk,Rondebosch, 7700

(021) 650 2159 [email protected] 1 May 2013

Monitoring person*


Ms Olivia van der Hoven Private Bag X3,Rondebosch, 7701

Bremner Buidling, Lovers' Walk,Rondebosch, 7700

(021) 650 2159 [email protected] 1 May 2013

*(In terms of Section 13A of the Pension Funds Act)

PROFESSIONAL SERVICE PROVIDERS

Actuary/Valuator


Dr Erich Potgieter Private Bag X30,Rondebosch, 7701

Great Westerford Building, 240 MainRoad, Rondebosch, 7700

(021) 681 3700 [email protected]

1 Apr 1998

Auditor


PricewaterhouseCoopers Inc. P.O. Box 2799, Cape Town,8000

1 Waterhouse Place, Century City,Cape Town, 7441

(021) 529 2000 [email protected] 1 Jul 2013

Benefit administrator

Full name Postal address Physical addressTelephonenumber Appointed

Benefitadministrator'sregistration numberin terms ofsection 13B

Sanlam Employee Benefits(Division of Sanlam LifeInsurance Limited)

P.O. Box 1, Sanlamhof,7532

2 Strand Road, Bellville, 7530 (021) 947 9111 1 Jan 1995 24/85

Fund consultant


Fund consultant'sFAISregistration number

Towers Watson (Pty) Limited Private Bag X30,Rondebosch, 7701


(021) 681 3700 1 Apr 1998 2545

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SCHEDULE AREGULATORY INFORMATION (continued)For the year ended 30 June 2014

Investment administrator


Investmentadministrator'sFAIS registrationnumber

ABAX Investments (Pty) Limited P.O. Box 23851, Clarmont,7735

Ground Floor Coronation House TheOval, 1 Oakdale Road, Newlands,7700

(021) 670 8960 1 May 2014 856

Allan Gray Investment ServicesLimited

P.O. Box 21318, Waterfront,Cape Town, 8002

Granger Bay Court, Beach Road,V&A Waterfront, 8001

(021) 415 2300 1 Feb 2004 19896

Catalyst Fund Managers SA P.O.Box 44845, Claremont,7735

c/o Catalyst Fund Managers, 27thfloor Thibault Square, Cape Town,8001

(021) 657 5500 21 Jun 2012 723

Coris Capital CollectiveInvestment Managers Limited

Private Bag X14, HighveldPark, 0169

Lords Office Estate, 276 WestStreet, Centurion, 0169

(012) 683 3400 1 May 2009 581

Investec Asset Management(Pty) Limited

P.O. Box 1655, Cape Town,8000

5th Floor, Norwich on St George'sMall, Cape Town, 8001

(021) 410 5100 1 Jun 2004 587

MMI Group Limited P.O. Box 2212, Bellville,7535

Metlife Centre, 7 Coen SteytlerAvenue, Cape Town, 8001

(021) 917 3111 21 Sep 1995 3780

PIMCO Europe Limited 11 Baker Street, London,W1U3AH

11 Baker Street, London, W1U3AH (044) 2079 730023 1 Feb 2013 42071

Prescient InvestmentManagement (Pty) Limited

P.O. Box 31142, Tokai,7966

Prescient House The Terraces,Steenberg Boulevard, SteenbergOffice Park, 7945

(021) 700 3600 1 Feb 2001 612

Prescient Life Limited P.O.Box 31142 , Tokai,7966

Prescient House, WestlakeBusiness Park, Otto Close,Westlake, 7945

(021) 700 3622 31 Mar 2010 44077

Sanlam Life Insurance Limited P.O. Box 1, Sanlamhof,7532

2 Strand Road, Bellville, 7530 (021) 947 9111 1 May 2009 579

Stone Harbor InvestmentPartners LP

31 West 52ND Street, 16THFloor, New York, 10019

31 West 52ND Street, 16TH Floor,New York, 10019

(212) 548 1200 1 Apr 2013 43570

Investment advisor


Investment advisor'sFAIS registrationnumber

Towers Watson (Pty) Limited Private Bag X30,Rondebosch, 7701


(021) 681 3700 1 Apr 1998 2545

Risk insurer

Full name Postal address Physical addressTelephonenumber Appointed FSP approval no

Capital Alliance P.O. Box 1655, Cape Town,8002

2nd Floor, Mariendahl House, CnrMain & Campground, Newlands,7700

(021) 416 1555 1 Jan 2000 17404

Custodian and/or nominee

Full name Postal address Physical addressTelephonenumber Appointed FSP approval no

Nedbank Limited P.O. Box 1144,Johannesburg, 2000

3rd Floor, Braampark Forum IV, 33Hoofd Street, Braamfontein, 2001

(011) 667 1000 1 Dec 2003 9363

PARTICIPATING EMPLOYERS

The following employers participates in the Fund in terms of the Rules of the Fund:

� University of Cape Town� Cape Higher Education Consortium NPC (Non Profit Organisation Number: 028-374-NPO)

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SCHEDULE EREPORT OF THE BOARD OF TRUSTEESAs at 30 June 2014

1. DESCRIPTION OF FUND

1.1. Type of Fund

The Fund is a Defined Contribution Provident Fund.

1.2. Benefits

The Fund provides retirement, death and withdrawal benefits. Members on the permanent staff of the employer may elect,under certain conditions, to reduce the multiple of death cover provided, in which case the employer contributions towardsretirement benefits are increased for those members, in line with the consequential reduction of death-in-cover costs. Thedeath benefit (group life assurance cover) for permanent staff under the Fund, unless reduced, is six times annual deemedpensionable amount. It is part of the approved scheme. This means that payment of tax is deferred until a benefit is paid.

There is a separate, unapproved group life assurance scheme, outside of the UNIVERSITY OF CAPE TOWN RETIREMENTFUND, providing a compulsory single multiple of the annual deemed pensionable amount for death and permanent disabilitycover for members on the permanent staff of the employer, and a compulsory 3 times multiple for members who are fixed-termcontract staff of the employer. As this is unapproved, it is a member contributed scheme; the employer pays the premium onthe members' behalf and deducts the tax on behalf of the member in respect of the premium paid. Members may in certaincircumstances elect to increase the multiple of this cover, and if permitted to do so must meet the premiums for the additionalmultiples. Any benefit paid out under this scheme is not subject to tax.

There is also a separate unapproved disability income continuation scheme for members who are permanent staff of theemployer, outside of the UNIVERSITY OF CAPE TOWN RETIREMENT FUND.

1.2.1.Unclaimed benefits

The Trustees and Principal Officer endeavour to trace those former members with outstanding benefits in order to pay suchbenefits. Procedures between the employer and the Fund for exiting staff are regularly monitored.In respect of unclaimedbenefits, complete records, as prescribed, are maintained since inception.

1.3. Contributions

1.3.1. Member contributions

According to Rule 8.1 of the Fund a member will not be required to contribute to the Fund, unless the member is granted leave of absence with less than full normal remuneration. If the employer does not contribute to the Fund in respect of the member during such absence, the member must contribute 6.5% of his/her normal pensionable salary to cover the contributions to the separate unapproved schemes and the balance to the Fund.

Such member does, however, have the option to contribute 22.5% of his/her normal pensionable salary to the Fund during suchabsence. Such contributions would be member contributions. The costs of the Fund regarding the member and the cost ofdeath-in-service benefits are first deducted from the contributions referred to above and the balance is credited to his/hermember's accumulated credit in accordance with the determination for employer contributions.

Member contribution rates for permanent staff on leave without pay (limited contributions):

Period Total membercontribution

Separateunapproved

schemes

Risks & costs Retirement savings Discretionaryretirement savings

2014/03/01 -2014/06/30

6.500% 0.859% 1.491% 0.000% 4.150%

2013/03/01 -2014/02/28

6.500% 1.031% 1.469% 0.000% 4.000%

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SCHEDULE EREPORT OF THE BOARD OF TRUSTEES (continued)For the year ended 30 June 2014

Member contribution rates for fixed term contract staff on leave without pay (limited contributions):


Separateunapproved

schemes


2014/03/01 -2014/06/30

6.500% 0.777% 0.495% 0.000% 5.228%

2013/03/01 -2014/02/28

6.500% 0.993% 0.519% 0.000% 4.988%

Member contribution rates for permanent staff on leave without pay (full contributions):


Separateunapproved

schemes


2014/03/01 -2014/06/30

22.500% 0.859% 1.491% 16.000% 4.150%

2013/03/01 -2014/02/28

22.500% 1.031% 1.469% 16.000% 4.000%

Member contribution rates for fixed term contract staff on leave without pay (full contributions):


Separateunapproved

schemes


2014/03/01 -2014/06/30

22.500% 0.777% 0.495% 16.000% 5.228%

2013/03/01 -2014/02/28

22.500% 0.993% 0.519% 16.000% 4.988%

1.3.2. Employer contributions

The employer contributed to the Fund based on the rates set out in the table below.

Employer contribution rates for permanent staff:

Period Total employercontribution

Separateunapproved

schemes


2014/03/01 -2014/06/30

22.500% 0.859% 1.491% 16.000% 4.150%

2013/03/01 -2014/02/28

22.500% 1.031% 1.469% 16.000% 4.000%

Employer contribution rates for fixed term contract staff:


Separateunapproved

schemes


2014/03/01 -2014/06/30

20.912% 0.777% 0.495% 16.000% 3.640%

2013/03/01 -2014/02/28

20.912% 0.993% 0.519% 16.000% 3.400%

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Employer contribution rates for permanent staff on leave without pay (limited contributions):


Separateunapproved

schemes


2014/03/01 -2014/06/30

6.500% 0.859% 1.491% 0.000% 4.150%

2013/03/01 -2014/02/28

6.500% 1.031% 1.469% 0.000% 4.000%

Employer contribution rates for members on leave without pay (full contributions):


Separateunapproved

schemes


2014/03/01 -2014/06/30

22.500% 0.859% 1.491% 16.000% 4.150%

2013/03/01 -2014/02/28

22.500% 1.031% 1.469% 16.000% 4.000%

Employer contribution rates for disability members (disablity lumpsums paid out):


Separateunapproved

schemes


2014/03/01 -2014/06/30

21.641% 0.000% 1.491% 16.000% 4.150%

2013/03/01 -2014/02/28

21.469% 0.000% 1.469% 16.000% 4.000%

Employer contribution rates for disability members:


Separateunapproved

schemes


2014/03/01 -2014/06/30

21.900% 0.259% 1.491% 16.000% 4.150%

2013/03/01 -2014/02/28

21.800% 0.331% 1.469% 16.000% 4.000%

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1.4. Rule Amendments

Ruleamendment

No.

Descriptionand

motivation

Date ofBoard of Trustees'

resolution

Effectivedate

Date registered bythe

Financial ServicesBoard

3.Paragraph 1and 3 to 6

In terms of recent changes to tax legislation,Employer owned Deferred Compensation Policieseffected for the benefit of certain Employees who areMembers of the Fund can now be ceded to the Fundwithout raising tax for the relevant Employees at thetime of the cession. The amendments will thereforeallow the Fund to receive the value of said policieson behalf of the Members concerned and for theTrustees to deal with the value of such cessions tothe benefit of the Members concerned.

6 December 2013 1 July 2013 3 April 2014

3.Paragraph 2

To clarify that Portfolio A (the Fund�s Income Fundportfolio) may be used where the rules specify thatmonies must be invested in near-Cash.

6 December 2013 1 July 2013 3 April 2014

All Rule amendments are available for inspection at the Fund�s registered office.

1.5. Reserves established in terms of the Rules of the Fund

General Reserve Account:

The "General Reserve Account" was established to provide for contingencies and obligations of the Fund not covered by theAccumulation Account, the Risk Reserve Account, Data Reserve, Surplus Apportionment Cost Reserve, Processing ErrorReserve or the Living Annuity Balance Account. These obligations include the fees of the valuator, the administrator andauditors.

Risk Reserve Account:

The "Risk Reserve Account" is no longer being built up to minimize fluctuations arising from death and disability benefits tomembers as the Fund fully insures its risk benefits.

Data Reserve:

The "Data Reserve" is to account for the quality of the data submitted for valuation of the Fund.

Processing Error Reserve:

The "Processing Error Reserve" was established to provide for mismatching and for timing differences in the actual investmentof monies from the time when they are deemed to have occurred in the calculation of benefits or the accrual of investmentreturns.

Surplus Apportionment Cost Reserve:

The "Surplus Apportionment Cost Reserve" was established to provide for:- Fund costs in respect of surplus apportionment exercises; and- Fund costs related to ad hoc bonuses to members as determined by the Trustees in consultation with the Fund actuary based upon distributable valuation surpluses.

2. INVESTMENTS

2.1 Investment strategy

The Board of Trustees have formulated an investment strategy and produced an Investment Policy Statement. Theinvestments are managed according to mandates set in terms of these principles. The investment strategy complies with theprovisions of Regulation 28 under the Pension Funds Act 24 of 1956 in South Africa. The Trustees reviewed and revised theInvestment Policy Statement during March 2014.

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2.1.1. General

The Trustees are advised by an Investment Consultant (Towers Watson (Pty) Ltd) and supported by an InvestmentCommittee. For the Balanced Fund (Portfolio C) the Trustees have adopted a specialist investment manager approach. Theinvestment managers for the SA and global equity parts of this portfolio must adopt the intrinsic value investment approach interms of the Investment Policy Statement.

2.1.2. Individual member choice

The members have the option of electing the Life Stage Model of investment choice or making their own investment choicesacross the current Fund portfolios (Income Fund, Smoothed Bonus Fund, Balanced Fund and Shari'ah Fund). They mayexercise this choice twice a year on 31 March and 30 September.

The living annuitants have the option of making their own investment choices across the current Fund portfolios (IncomeFund, Smoothed Bonus Fund, Balanced Fund and Shari'ah Fund). They may exercise this choice twice a year on 31 Marchand 30 September.

2.1.3. Unclaimed benefits

The Board of Trustees and Principal Officer with the help of the employer, endeavour to trace former members withoutstanding benefits. Unclaimed benefits are held in the Fund�s near cash portfolio as defined by the Rules of the Fund. Thisprovides capital protection and liquidity as the Fund is in the process of making these payments. The Fund charges anadministration fee against unclaimed benefits which is the charge levied by the administrator for administering the memberrecord.

2.1.4. Surplus apportionment allocations

The 2001 Surplus amounts payable to former members are invested by the Fund in the Fund's near cash portfolio as definedby the Rules of the Fund. The 2010 Surplus amounts payable to former members are held in the Fund's near cash portfolio asdefined by the Rules of the Fund. Such 2001 and 2010 surplus amounts that have not yet been paid, were transferred tounclaimed benefits. This provides capital protection and liquidity as the Fund is in the process of making these payments. Interms of Fund policy the return on distributable surplus awaiting distribution accrues to the surplus beneficiary concerned. Thesurplus allocations to active members, deferred pensioners and living annuitants were allocated to their respective accounts inthe Fund.

The Board of Trustees have approved a proposal to allocate a surplus of R 4,506,000 at 30 June 2012 to current memberswho was still active at the time the surplus was allocated.

2.1.5. Reserve accounts

These funds are invested in terms of the investment strategy of the Fund in the Income Fund. This provides capital protectionand liquidity.

2.1.6. Derivative Instruments

The Fund�s mandates to investment managers allow investment managers to use derivative instruments, and define the limitsin each case. The Fund�s investment advisers monitor compliance with these limits on a regular (not less than quarterly)basis.

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2.2 Management of investments

The Trustees monitor the management and performance of the investments regularly. The Fund had investment policies withSanlam Life Insurance Limited, MMI Group Limited and Prescient Life Limited as well as directly held assets managed by AllanGray Investment Services Limited, Prescient Investment Management Limited, Investec Asset Management Limited and CatalystFund Managers SA. Collective investment schemes investing in a diverse mix of assets are held with Stone Harbor InvestmentPartners LP, PIMCO Europe Limited and Abax Investments (Pty) Limited for the period ended 30 June 2014.

The net returns of these portfolios by the Fund for the period 1 July 2013 to 30 June 2014 were:

Asset Management Analysis Gross Income % Cost % Net Income %

Abax Investments (Pty) Limited* 6.35% 0.00% 6.35%Allan Gray Investment Services Limited - SA Equity 32.09% 0.01% 32.08%Allan Gray Investment Services Limited - Offshore 37.55% 2.54% 35.01%Catalyst Fund Managers SA 8.24% 0.43% 7.81%Investec Asset Management (Pty) Limited 48.20% 1.22% 46.98%Metropolitan Life - Living Annuitants Members 21.04% 0.59% 20.45%Metropolitan Smooth Bonus - Active Members 21.04% 0.59% 20.45%PIMCO Europe Limited 16.33% 0.57% 15.76%Prescient Bond Fund 8.49% 0.31% 8.18%Prescient Income Fund 6.63% 0.12% 6.51%Prescient Life Limited (27four) 20.47% 0.44% 20.03%Stone Harbor Investment Partners LP 13.82% 0.68% 13.14%

* The commencement date of the portfolios managed by Abax Investments (Pty) Limited was 1 May 2014.

The fair value of the Fund's investments, administered by the investment administrators were:

30 June 2014R

30 June 2013R

Abax Investments (Pty) Limited 217,065,670 -Allan Gray Investment South Africa Pty Ltd - Offshore 412,032,790 373,173,728Allan Gray Investment South Africa Pty Ltd - SA Equity 657,419,089 512,065,695Catalyst Fund Managers SA 80,892,080 74,807,778Investec Asset Management (Pty) Limited 402,429,267 342,800,564MMI Group Limited 909,315,001 708,195,804PIMCO Europe Limited 87,408,474 75,506,033Prescient Investment Management (Pty) Limited 687,606,540 608,153,023Prescient Life Limited (27four) 71,435,339 48,706,027Sanlam Life Insurance 2,596,851 12,581,380Stone Harbor Investment Partners LP 79,712,680 70,333,348

Total value of investments managed 3,607,913,781 2,826,323,380

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3. MEMBERSHIP

3.1. Members, deferred pensioners, living annuitants and beneficiaries

Activemembers

Deferredpensioners

LivingAnnuitants

Beneficiaries

Number at the beginning of year 3,589 115 156 21Opening balance corrections (2) - - (17)Additions 317 - - -Transfers in 43 - - n/aTransfers out (1) - (1) n/aWithdrawals (196) (1) - n/aRetirements (80) (4) - n/aDeaths (7) - (2) -Transfers to deferred pensioners (20) 20 - -Transfers to Living Annuities (29) - 29 -

Number at the end of the year 3,614 130 182 4

Local at the end of the year 3,614 130 182 4Foreign at the end of the year - - - -

Additions refer to new members of the Fund (excluding transfers in). Transfers in reflect members transferring into the Fundfrom other funds (see note 6). Transfers out refer to section 14 transfers to other funds. Transfers to deferred pensionersreflect resigning members who have elected to preserve their benefits. Transfers from deferred pensioners reflect membersthat previously preserved their benefits in the Fund and have now been re-employed by the participating employer. Transfersto Living Annuities reflect those retiring members electing to draw a pension from the Fund in the form of a Living Annuity.Withdrawals, retirements and deaths reflect departures from active members, deferred pensioners or living annuitants, as thecase may be, not considered in any other category above.

All active members, deferred pensioners and living annuitants are South African citizens or permanent residents. Although wewould not necessarily know details of domicile, we have no record of any deferred pensioner who has domicile outside ofSouth Africa. All active members and all living annuitants are domiciled in South Africa.

3.2. Opening balance corrections

The opening balance correction under the Active members column is as follows: 2 Members that were shown as activemembers in the prior year had exit dates pertaining to the prior reporting period.

The opening balance correction under the beneficiaries column is as follows: 17 beneficiaries for whom term annuities hadbeen purchased in a prior reporting period was incorrectly disclosed under the beneficiaries in the prior reporting period. Afteran investigation it was established that these term annuities were not bought in the name of the Fund.

4. ACTUARIAL VALUATION

In accordance with the rules of the Fund, the financial position of the Fund is examined and reported upon by the valuator atintervals not exceeding three years. For good governance, the Trustees have requested that an annual valuation be performed.

The last statutory valuation was performed as at 30 June 2012. The actuary recommended that the Processing Error Reserveshould be set at a level of 0.25% of the market value of assets for Portfolio C and Portfolio D only and that the Data Reserveshould be set at a level of 0.5% of the market value of total assets.

The valuation report reflected a surplus of R4 506 000. The Trustees have approved a proposal to allocate this surplus tocurrent members as at 30 June 2012 who was still active at the time the surplus was allocated.

An interim valuation was completed as at 30 June 2013 in which it was found that the Fund was in a financially sound position.

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5. SURPLUS APPORTIONMENT

The Actuary and Valuator of the Fund completed the valuation for the period 01 January 2008 to 30 June 2010 in 2011 and indoing so determined that there was a distubutable surplus in the Fund as at 30 June 2010. The Trustees accepted therecommendations of the Actuary / Valuator that this surplus be distributed to members and former members and determinedthe distribution method. The surplus was allocated to accumulated credits on 12 April 2012 for all categories of members inrespect of whom the Fund held accumulated credits at any time after 31 December 2007 to 30 June 2010. Surplus paymentsare due to former members in respect of whom the Fund held accumulated credits at anytime after 31 December 2007 to 30June 2010. At financial year end distributable surpluses (including allocated investment return on such surpluses) totallingR99,150 (2013 : R534,754) remained to be paid to 42 former members (2013 : 224).

The Board of Trustees have approved a proposal to allocate the surplus, as at 30 June 2012, to the current members. Thesurplus was apportioned pro rata to the accumulated credits of the members of the Fund (including pensioners and deferredmembers) as at 30 June 2012.

6. HOUSING LOAN FACILITIES

The Fund Rules do not allow loans for any purpose from the Fund. The Fund Rules allow members to pledge a portion of theirnet withdrawal benefit as security for loans for housing from approved financial institutions. This is subject to the provisions ofthe Pension Funds Act 24 of 1956 and the provisions of the National Credit Act 34 of 2005. The total outstanding borrowing at30 June 2014 against which pledges had been made in prior years was R4,512,895 (2013 : R3,111,146); the number ofmembers involved was 65 (2013 : 54). Refer to note 5 of the financial statements.

7. INVESTMENTS IN PARTICIPATING EMPLOYERS

The Fund holds no investments in the participating employers.

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8. SIGNIFICANT MATTERS

Proposed Rule amendments

The following significant changes to the Rules have been made subsequent to the balance sheet date, and have beensubmitted for registration:

The requirement to give the FSB written notice of the appointment of a new Principal Officer in accordance with prescribedrequirements has been extended to Valuators and Auditors as well. The Rules have been amended to provide for this change.

The definitions of �pension preservation fund� and �provident preservation fund� in the Rules have been updated in accordancewith the changes to the Pension Funds Act.

The Board of Trustees had, in addition, having regard to the fact that the same mandatory annuitisation requirements currentlyapplicable to pension and retirement annuity fund were to be applied to provident funds as from 1 March 2015 in terms ofamendments to income tax legislation. Changed income tax legislation was to have protected historic vested rights within aprovident fund. The pre 1 March 2015 Accumulated Credits of Members would have had to be kept separate from their post 1March 2015 Accumulated Credits. Rule changes to accommodate these changes were approved by the Board of Trustees, buthave now been withdrawn.

The Rules now empower the Board of Trustees to direct that the benefit of a Member or Beneficiary be paid to a third party ifthe Member or Beneficiary is able to submit sufficient proof that he/she is unable to open a bank account.

The Rules now allow for the deduction of amounts awarded to non-member spouses not only in terms of divorce orders interms of section 7(8) of the Divorce Act, but also in terms of other applicable legislation.

The definition of �unclaimed benefit� has been amended to include a benefit due to a non-member spouse not paid within 24months from the date of election or expiry of the election period (120 days). The Rules have been amended to provide for thischange.

Provision has been made for the Board of Trustees to appoint a deputy Principal Officer who may act as Principal Officer if thePrincipal Officer is unable to discharge any duty who may be given some of the delegated duties of the Principal Officer. TheFund has not yet made such an appointment.

The Rules now require the Board of Trustees to request Employers participating in the Fund to notify it in writing of the identityof the persons who are personally liable for the payment of contributions to the Fund.

Rule 13.9(7) has been rectified, as it contradicted Rule 11.5(2) with regard to the way unclaimed benefits are to be dealt with inthe case of Section 28 or 29 dissolutions.

Appendix I has been amended to provide for the recent changes to Section 37C of the Act.

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SCHEDULE FSTATEMENT OF NET ASSETS AND FUNDSAs at 30 June 2014

Note30 June 2014

R30 June 2013

RASSETS

Non-current assets 3,611,796,032 2,830,486,706Investments 2 3,607,913,781 2,826,323,380Investments supporting unclaimed benefits 3 3,882,251 4,163,326

Current assetsCash and money market funds 4 9,051,094 34,698,146

Total assets 3,620,847,126 2,865,184,852

FUNDS AND LIABILITIES

Members� funds and surplus account 3,170,677,181 2,533,207,261Members� individual accounts 18 3,167,437,417 2,519,780,953Amounts to be allocated 20 642,913 844,928Beneficiaries term annuity policies 15.1 2,596,851 12,581,380

ReservesReserve accounts 19 386,733,172 277,445,122

Total funds and reserves 3,557,410,353 2,810,652,383

Non-current liabilitiesUnclaimed benefits 9 5,162,234 4,163,326

Current liabilities 58,274,539 50,369,143Transfers payable 7 426,340 3,226,579Benefits payable 8 57,339,290 46,390,280Accounts payable 10 508,909 752,284

Total funds and liabilities 3,620,847,126 2,865,184,852

- 16 -

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- 17 -


SCHEDULE HANOTES TO THE ANNUAL FINANCIAL STATEMENTSFor the year ended 30 June 2014

1. PRINCIPAL ACCOUNTING POLICIES

The following are the principal accounting policies used by the Fund. These policies have been applied consistently to all yearspresented, unless otherwise specifically stated.

1.1. PURPOSE AND BASIS OF PREPARATION OF ANNUAL FINANCIAL STATEMENTS

The annual financial statements are prepared in accordance with the Regulatory Reporting Requirements for Retirement Fundsin South Africa, the Rules of the Fund and the provisions of the Pension Funds Act.

The annual financial statements are prepared on the historical cost and going concern basis, except where specifically indicatedotherwise in the accounting policies below:

1.2. FINANCIAL INSTRUMENTS

Measurement

A financial instrument is any contract that gives rise to both a financial asset of one entity and a financial liability or equityinstrument of any other entity. A financial asset or a financial liability is recognised when its contractual arrangements becomebinding and is derecognised when the contractual rights to the cash flows of the instrument expire or when such rights aretransferred in a transaction in which substantially all risks and rewards of ownership of the instrument are transferred.

Financial instruments carried on the statement of net assets and funds, include cash and bank balances, investments, housingloans, receivables and accounts payable.

Financial instruments are recognised on acquisition using trade date accounting, which includes transaction costs. Upon initialrecognition financial instruments are designated at fair value through the statement of changes in net assets and funds as theassets or liabilities are managed, evaluated and reported internally on a fair value basis and/or the designation eliminates orsignificantly reduces an accounting mismatch which would otherwise arise.

Subsequent to initial recognition, these instruments are measured as set out below.

1.2.1. INVESTMENTS

Investments are classified at fair value through the statement of changes in net assets and funds and are measured at fairvalue.

Debentures

Debentures comprise investments in listed and unlisted debentures.

Listed debentures

The fair value of listed debentures traded on active liquid markets is based on regulated exchange quoted ruling closing pricesat the close of business on the last trading day on or before the statements of net assets and funds date.

Bills and bonds

Bills and bonds comprise investments in government or provincial administration, local authorities, participating employers,subsidiaries or holding companies and corporate bonds.

Listed bills and bonds

The fair value of listed bills and bonds traded on active liquid markets is based on regulated exchange quoted ruling closingprices at the close of business on the last trading day on or before the statements of net assets and funds date.

Equities

Equity instruments consist of equities with primary listing on the JSE, equities with secondary listing on the JSE, foreign listedequities and unlisted equities.

Equity instruments designated as fair value through the statement of changes in net assets and funds by the fund are initiallyrecognised at fair value on trade date.

- 18 -


SCHEDULE HANOTES TO THE ANNUAL FINANCIAL STATEMENTS (continued)For the year ended 30 June 2014

Listed equities

Equity instruments are subsequently measured at fair value and the fair value adjustments are recognised in the statement ofchanges in net assets and funds. The fair value of equity instruments with standard terms and conditions and traded on activeliquid markets is based on regulated exchange quoted ruling closing prices at the close of business on the last trading day on orbefore the statements of net assets and funds date.

Preference shares

Listed preference shares

The fair value of listed preference shares traded on active liquid markets is based on regulated exchanged quoted ruling closingprices at the close of business on the last trading day on or before the statement of net assets and funds date.

Insurance policies

Non - linked insurance policies

Non - linked insurance policies with insurers are valued on the basis of the policyholder�s retrospective contribution to assets(i.e. accumulation at the actual investment return achieved on gross premiums.)

Linked or market-related policies

If the policy is unitised, the value is equal to the market value of the underlying units. Other linked or market-related policies arevalued at the market value of the underlying assets for each policy, in line with the insurer�s valuation practices.

Beneficiaries term annuity policies

Beneficiaries term annuity policies purchased in the name of the Fund with the insurer are disclosed as an asset of the Fundand included under investments. The corresponding liabilities are included under funds and reserves. These term annuitypolicies are valued as equivalent to the financial soundness valuation as certified by the insurer.

Collective investment scheme

Investments in collective investment schemes are valued at fair value which is the quoted unit values, as derived by thecollective investment scheme manager with reference to the rules of each particular collective investment scheme, multiplied bythe number of units.

1.2.2. ACCOUNTS RECEIVABLE

Accounts receivable are financial assets measured initially at fair value and subsequently measured at amortised cost using theeffective interest rate method, less any allowance for impairment.

1.2.3. CASH AND CASH EQUIVALENTS

Cash and equivalents comprise cash in hand, deposits held at call with banks, and other short-term highly liquid investmentswith original maturities of three months or less. Cash and cash equivalents are measured at fair value.

1.2.4. ACCOUNTS PAYABLE

Accounts payable are financial liabilities measured initially at fair value, net of transaction costs that are directly attributable tothe liability and subsequently measured at amortised cost using the effective interest rate method.

1.3. RESERVES

Reserve accounts comprise particular amounts of designated income and expenses as set out in the rules of the fund and arerecognised in the year in which such income and expenses accrue to the fund.

- 19 -



1.4. IMPAIRMENT

Financial assets carried at amortised cost

The Fund assesses at each statement of net assets and funds date whether or not there is objective evidence that a financialasset or group of financial assets is impaired. A financial asset or group of financial assets is impaired and impairment lossesare incurred only if there is objective evidence of impairment as a result of one or more events that have occurred after the initialrecognition of the asset (a loss event) and that loss event has an impact on the estimated future cash flows of the financialasset or group of financial assets that can be reliably estimated.

The Fund first assesses whether objective evidence of impairment exists individually for financial assets that are individuallysignificant. If the Fund determines that no objective evidence of impairment exists for an individually assessed financial asset,whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics andcollectively assesses them for impairment.

If there is objective evidence that an impairment loss has been incurred on loans and receivables or held to maturityinvestments carried at amortised cost, the amount of the loss is measured as the difference between the asset�s carryingamount and the present value of the estimated future cash flow (excluding future credit losses that have been incurred)discounted at the financial asset�s original effective interest rate. The carrying amount of the asset is reduced and the amount ofthe loss is recognised in the statement of changes in net assets and funds. If a loan has a variable interest rate, the discountrate for measuring any impairment loss is the current effective interest rate determined under contract. As a practical expedient,the Fund may measure impairment on the basis of an instrument�s fair value using an observable market price.

If, in a subsequent year, the amount of the impairment loss decreases and the decrease can be related objectively to an eventoccurring after the impairment was recognised (such as improved credit rating), the previously recognised impairment loss isreversed in the statement of changes in net assets and funds.

Impairment of non-financial assets

Assets that have an indefinite useful life, for example land, are not subject to amortization and are tested annually forimpairment. Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstancesindicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset�snet carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset�s fair value less costs tosell and value in use. For this purpose of assessing impairment, assets are grouped at the lowest levels for which there areseparately identifiable cash flows.

Impairment of loans and receivables

A provision for impairment of loans and receivables is established when there is objective evidence that the fund will not be ableto collect all amounts due according to their original terms.

1.5. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions

Provisions are recognised when the fund has a present legal or constructive obligation as a result of past events, for which it isprobable that an outflow of economic benefits will be required to settle the obligation, and a reliable estimate of the amount ofthe obligation can be made. Where the effect of discounting to present value is material, provisions are adjusted to reflect thetime value of money.

Contingent liabilities

A contingent liability is not recognised in the statement of net assets and funds, but disclosed in the notes to the financialstatements, unless the possibility of an outflow of resources embodying economic benefits is remote.

Contingent assets

A contingent asset is not recognised in the statement of net assets and funds, but disclosed in the notes to the financialstatements when an inflow of economic benefits is probable.

- 20 -



1.6. CONTRIBUTIONS

Contributions are measured at the fair value of the consideration received or receivable.

Contributions are accrued and recognised as income in accordance with the actuarial recommendations, and the rules of theretirement Fund. Contributions received are apportioned between retirement funding and funding for risk and other expenses.The apportionment is governed by the rules of the fund and actuarial recommendations.

Voluntary contributions are recognised when they are received from annual payments, or accrued where monthly-recurringpayments are made.

Any contributions outstanding at the end of the reporting year are recognised as a current asset � contribution receivable. Anycontributions received in advance at the end of the reporting year are recognised as a current liability � accounts payable.Contributions transferred from surplus accounts

Contributions transferred from surplus accounts include any contributions that are funded from the surplus accounts and relatesto contribution holiday after surplus apportionment has been approved and the corresponding approval of the utilization of theemployer and member surplus accounts.

Interest charged on late payment of contributions

Compound interest on late payments or unpaid amounts and values shall be calculated for the year from the first day of themonth following the expiration for the year in respect of which the relevant amounts or values are payable or transferable untilthe date of receipt by the Fund.

1.7. FOREIGN CURRENCIES

Transactions in foreign currencies are accounted for at the ruling rate of exchange on the transaction date. Assets and liabilitiesin foreign currencies are converted at the ruling rate of exchange on the statements of net assets and funds date.

Gains and losses on conversion are dealt with in the statement of changes in net assets and funds.

Income and expenditure relating to foreign investments are converted to South African currency at appropriate weightedaverage exchange rates, for the period.

1.8. INVESTMENT INCOME

Dividends

Dividend income is recognised in the statement of changes in net assets and funds when the right to receive payment isestablished � this is the last date to trade for equity securities. For financial assets designated at fair value through thestatement of changes in net assets and funds, the dividend income forms part of the fair value adjustment.

Interest

Interest income in respect of financial assets held at amortised cost is accounted for in the statement of changes in net assetsand funds using the effective interest rate method.

Collective investment schemes� distribution

Distribution from collective investment schemes are recognised when the right to receive payment is established.

Income from policies with insurance companies

Income from investment policies from insurance companies is included in the adjustment to the movement of the financialasset.

Adjustment to fair value

Gains or losses arising from changes in the fair value of financial assets at fair value through the statement of changes in netassets and funds are presented in the statement of changes in net assets and funds in the year in which they arise.

Expenses incurred in managing investments

Expenses in respect of the management of investments are recognised as the service is rendered.

- 21 -



1.9. BENEFITS

Benefits payable and pensions are measured in terms of the Rules of the Fund.

Benefit payments and monthly pension payments are recognised as an expense when they are due and payable in terms of theRules of the Fund. Any benefits not paid at the end of the reporting year are recognised as a current liability � benefits payable /due.

Reinsurance proceeds

Reinsurance proceeds are measured at the fair value of the consideration received or receivable and are accrued andrecognised as income at the same time as the recognition of the related claim.

Internal Transfer to Living Annuities at Retirement

The Fund Rules provide members who retire from the Fund with an option to commute the accumulated credit for a cashpayment and/or purchase a pension in the manner permitted by the Rules either from the Fund or from an insurer. The benefitpayable to members electing to purchase a pension from the Fund are disclosed first as a benefit payable and then a transfer tothe Fund.

1.10. TRANSFERS TO AND FROM THE FUND

Section 14 and 15B transfers

Section 14 and 15B transfers to or from the Fund, under the Pension Fund Act 24 of 1956, are recognised on the date ofapproval of the scheme/arrangement of transfer of business by the Financial Services Board, as contained in the approvalcertificate from the Registrar. The transfers are measured at the values as per the section 14 application or the value of thetransfer at effective date of transfer adjusted for investment return or late payment interest as guided by the application.

Individual Transfers

Individual transfers (Section 13A(5) transfers) are recognised on the earlier of receipt of the written notice of transfer(Recognition of Transfer) or receipt of the actual transfer value. The transfer is measured at the Recognition of Transfer valuetogether with late payment interest from the transferor fund where applicable.

Internal Transfer to Living Annuities at Retirement

Internal transfer to living annuities is recognised on receipt of the �benefit payment� (refer accounting policy note 1.9). Thetransfer is measured at the value of the �benefit payment", or portion thereof, as chosen by the member to purchase a livingannuity from the Fund.

1.11 ADMINISTRATION EXPENSES

Expenses incurred in the administration of retirement funds are recognised in the statement of changes in net assets and fundsin the reporting year to which they relate.

In the event that an expense has not been paid at the end of a reporting year the liability will be reflected in the accountspayable note. If the expense was paid in advance or overpayment occurred, the applicable amount will be disclosed under theaccounts receivable note.

1.12. ACCOUNTING POLICIES, CHANGING IN ACCOUNTING ESTIMATES AND ERRORS

The Fund applies adjustments arising from changes in accounting policies and errors prospectively. The adjustment relating toa change in the accounting policy or error is therefore recognised in the current and future years affected by the change.

- 22 -

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- 24 -

UN

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to 2

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com

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ctu

arial surp

lus p

ayable

to m

em

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und is in t

he p

rocess o

f tr

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er

mem

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rela

ting t

o t

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npaid

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ctu

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etu

rn a

llocate

d r

epre

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rest

that

a m

em

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fter

the m

em

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cre

dit h

as b

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rom

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roduct,

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em

ain

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nsett

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or

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than f

ive

days.

- 27 -



9. UNCLAIMED BENEFITS

No. of members 30 June 2014R

30 June 2013R

Balance at the beginning of the year 249 4,163,326 1,991,207Transferred from benefits payable 4 1,279,983 857,687Transfered from surplus benefits payable - 1,614,707Investment income allocated 394,711 107,513Less:Administration expenses (1,593) (2,231)2001 surplus benefits paid (13) (48,329) (204,299)Unclaimed benefits paid (9) (625,864) (201,258)

Balance at the end of the year231 5,162,234 4,163,326

Note: Unclaimed benefits arise when the member has not for 24 months:��

��

��

� - exercised a choice in respect of the payment by the Fund of a benefit.

10. ACCOUNTS PAYABLE

30 June 2014R

30 June 2013R

Reinsurance premiums - -Refund of incorrect transfer received - 168,594Administration fees - Deferred pensioners 5,965 1,399Administration fees - Living annuitants - 3,414Administration fees - Unclaimed benefits 2,450 193Administration fees - Divorce order - 570Communication fees - 24,456Surplus distributions fees - 78,204Contributions timing difference 10.1 - 4,976Actuarial and consulting fees 88,920 84,018Principal officer fees 6,874 -Audit fees 404,700 386,460

Total 508,909 752,284

10.1 Contributions timing difference

30 June2014

30 June2013

R R

April 2013 Refund - 4,976- 4,976

The difference in the prior year was as a result of contributions received by the Fund relating to members who previously exitedfrom the Fund resulting in "over contributions".

- 28 -



11. CONTRIBUTIONS

A B C D A+B+C-DAt beginning

of the yearTowards

retirementTowards re-

insurance andexpenses

Contributionsreceived

At end of theyear

R R R R R

Member contributions received - 23,008 232,667 (255,675) -Employer contributions received - 194,894,830 62,762,708 (257,657,538) -

Total - 194,917,838 62,995,375 (257,913,213) -

Towards retirement 194,917,838Towards re-insurance and expenses 62,995,375

Statement of changes in net assets and funds 257,913,213

The allocation of employer contributions between "Towards retirement" and "Towards re-insurance and expenses" innote 11 are according to Fund rules. Where a member is on Leave Without Pay the contribution is made by the member oremployer. Actual contributions towards re-insurance and expenses were substantially less, the balance being added toretirement savings. See notes 17 and 18 .

Refer to the contribution tables in section 1.3 of the Trustees report.

ActiveMembers

DisabilityMembers

Leave WithoutPay - Member

Leave Without Pay - Employer

Total

R R R R R

Employer contributions toretirement savings 183,659,137 698,216 - 421,049 184,778,402

Employee contributions toretirement savings - - 23,008 - 23,008

Additional VoluntaryContributions - Employer 10,111,770 - - 4,658 10,116,428

Contributions - Expenses /Reinsurance 62,376,097 241,227 232,667 145,384 62,995,375

GLA 10,655,758 43,359 42,085 26,147 10,767,349

- Premiums 9,854,151 43,138 39,868 23,589 9,960,746

- Risk Cost Savings 801,607 221 2,217 2,558 806,603

General Reserve 3,626,024 13,699 13,479 8,250 3,661,452

Administration Costs 1,940,567 7,375 7,236 4,447 1,959,625Discretionary Retirement Savings

46,153,748 176,794 169,867 106,540 46,606,949

256,147,004 939,443 255,675 571,091 257,913,213

- 29 -



12. NET INVESTMENT INCOME

30 June 2014R

30 June 2013R

Income from investments 232,153,509 158,688,267� Dividends 27,441,964 19,701,454� Interest 52,175,202 45,967,292� Income from insurance policies 152,536,343 93,019,521Realised profits 130,399,472 176,262,443Adjustment to fair value 344,698,809 6,188,076

707,251,790 341,138,786Less: Expenses incurred in managing investments (8,651,639) (9,526,832)

Total 698,600,151 331,611,954

The "Expenses incurred in managing investments" are made up of the following payments to investment managers.

Investment manager30 June 2014

R30 June 2013

R

Abax Investments (Pty) Limited - -

Allan Gray Investment South Africa Pty Ltd (2,227,786) (1,703,637)

Allan Gray Investment South Africa Pty Ltd - Offshore performance rebate 2,824,094 444,936

Catalyst Fund Managers SA (346,478) (264,533)

Investec Asset Management (Pty) Limited (3,571,638) (3,313,850)

MMI Group Limited (3,994,081) (3,275,746)

Prescient Investment Management (Pty) Limited (1,457,269) (1,317,840)

Sanlam Life Insurance Limited (2,782) (96,162)

Stone Harbor Investment Partners LP 124,301 -

(8,651,639) (9,526,832)

The offshore investment management fees are netted against investment income in note 12 above, and such fees are not included in the schedule of expenses incurred in managing investments.

- 30 -



13. ADMINISTRATION EXPENSES

Note30 June 2014

R30 June 2013

R

Actuarial fees 478,344 451,896Administration fees 1,961,030 1,793,563Audit fees - Audit services 404,700 386,460Audit fees - prior period over / (under) provision 4,048 625Consultancy fees 549,480 519,840Fidelity insurance 45,000 30,000Other Expenses 753,756 855,881FSB levies 60,684 54,856Reserve Bank reporting fees *** 12,576 -General office expenses 110,659 103,750Switch fees - active members * 22,330 3,420Switch fees - living annuitants * - 684Bank charges 31,189 45,085Surplus distribution fees - 257,355Communication fees 207,554 272,246Surplus apportionment costs 216,393 39,157Administration fees - Housing loan guarantee * - 400Administration fees - deferred pensioners * 18,231 15,926Administration fees - living annuitants * 73,869 61,998Tracing fees ** 271 1,004Principal Officer office expenses 13.3. 581,041 576,815Other staff expenses 13.2. 1,004,107 857,861Board of Trustees expenses 13.1. 35,735 12,150

Total 5,817,241 5,485,091

* These expenses have been charged directly to members and former members (including unclaimed benefits) in terms of theFund Rules which now provide for these members to bear a portion of Fund costs.

�** These fees are paid from the surplus apportionment cost reserve.

�*** These fees were included in administration fees in the prior period.

13.1. Board of Trustees expenses30 June 2014

R30 June 2013

R

Trustee Training 35,735 6,000Membership fees - Institute of Retirement Funds - 6,150

Total 35,735 12,150

13.2. Other staff expenses30 June 2014

R30 June 2013

R

Lawyer Association fees 5,250 -Conference fees 6,874 -Training fees 5,520 -Other staff remuneration 986,463 857,861

Total 1,004,107 857,861

13.3. Principal Officer office expenses30 June 2014

R30 June 2013

R

Principal Officer remuneration 559,290 570,431Travel and accommodation 2,730 -Pension Lawyers Association fee 5,350 -Batseta membership fee and conference attendance 13,671 6,384

Total 581,041 576,815

-

- 31 -



13.4. Total cost analysis

The Fund�s total expenses (asset management fees as found in note 12 and administration expenses as found in note 13) areexpressed as a percentage of the average total assets of R3,243,015,990 for the year (2013/2012: R2,642,847,681 of averagetotal assets). These expense ratios exclude the re-insurance premiums indicated on the statement of changes in net assets andfunds and asset management fees paid to offshore investment managers (which are netted off against investment income asexplained in note 12). Re-insurance premiums are not related to total assets under management and are rather expressed as apercentage Rand cover per month: 2013/14 0.138 per R1,000pm and 2012/13 0.138 per R1,000pm.

30 June 2014 30 June 2013

Fund Administrator %0.06 %0.07Asset management %0.27 %0.36Other administrative expenses %0.12 %0.14

Total %0.45 %0.57

14. PRIOR PERIOD ADJUSTMENTS

30 June 2014R

30 June 2013R

Beneficiary term annuity policies - bought in the name of the Fund (10,735,487) 12,347,080

Total (10,735,487) 12,347,080

The prior period adjustment is as follows: 17 beneficiaries for whom term annuities had been purchased in a prior reportingperiod was incorrectly disclosed under the beneficiaries in the prior reporting period. After an investigation it was establishedthat these term annuities were not bought in the name of the Fund.

15. BENEFICIARIES TERM ANNUITY POLICIES

15.1. Financial liabilities 30 June 2014R

30 June 2013R

At beginning of period 12,581,380 -Opening balance adjustment (10,735,487) 12,347,080Income from insurance policy 1,048,381 1,552,745Administration expenses (282) (96,162)Monthly term annuity payments : Beneficiaries (297,141) (1,222,283)

2,596,851 12,581,380

- 32 -



16. RISK MANAGEMENT POLICIES

� Trustees approach to risk management

Having regard to the below areas of risk and the governance recommendations of Pension Fund Circular 130, the Trusteeshave adopted an active approach to risk management. A risk management policy was adapted by the Board of Trustees on 20June 2014 and will be reviewed annually. A programme to ensure that these measures are effective has been re-launched.

� Solvency risk

Solvency risk is the risk that the investment returns on assets will not be sufficient to meet the Fund's contractual obligations tomembers.

The nature of the Fund (defined contribution, member investment choice) is such that this risk is insubstantial. The investmentchannels (in particular the smoothed bonus and the income channel) have been designed to further reduce solvency risk.

� Credit risk

Credit risk is the risk that a counter-party to a financial instrument will fail to discharge an obligation, and cause the Fund toincur a financial loss. The Trustees review the position of the insurer providing the smoothed bonus investment channel on aregular basis, paying attention to such measures as its capital adequacy ratio and shareholder funds.

The Board of Trustees monitors receivable balances on an ongoing basis with the result that the Fund's exposure to bad debtsis not significant. An appropriate level of provision is maintained.

� Legal risk

Legal risk is the risk that the Fund will be exposed to contractual obligations for which no provision has been made. Legalrepresentatives of the Fund monitor the drafting of contracts to ensure that rights and obligations of all parties are clearly setout.

� Cash flow risk

Cash flow risk is the risk that future cash flows associated with monetary financial instruments will fluctuate in amount. In theinvestment channel where the risk might arise (the income portfolio) financial instruments are held to maturity.

� Currency risk

Currency risk is the risk that the value of an instrument will fluctuate in Rands owing to changes in foreign exchange rates. TheFund's exposure to currency risk is mainly in respect of foreign investments made on behalf of members of the Fund for thepurpose of seeking desirable international diversification of investments. Direct and indirect foreign investments do not exceedapproved Reserve Bank limits, thus minimising the risk

� Liquidity risk

Liquidity risk is the risk that the Fund will encounter difficulty in raising funds to meet commitments associated with financialinstruments. The nature of the investments allowed by the Fund's investment policies is such as to limit the Fund's exposure torisk.

� Market risk

Market risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market prices or marketinterest rates. This is implicit in the Balanced Fund Portfolio. Members can reduce this risk by investing in the smoothed bonusand income portfolios.

� Investments

Investments in equities are valued at fair value and therefore susceptible to market fluctuations. Investments are managed withthe aim of maximising the Fund's returns while limiting risk to acceptable levels within the framework of statutory requirements.

- 33 -



17. RELATED PARTY TRANSACTIONS

The following transactions between the participating employer and the fund occurred during the year

- The participating employers made effective contributions to the Fund for members' retirement and towards the Fund's expenses and reserves to the value of R242,136,295 and R15,521,243 respectively (2013:R221,072,949 and R14,314,944).

30 June 2014

R

30 June 2013

RRetirement Expenses Retirement Expenses

Employer Contributions (Refer note 11 ) 194,894,830 62,762,708 177,949,229 57,438,664Transferred to members (Refer note17.1) 47,241,468 (47,241,468) 43,123,720 (43,123,720)

242,136,298 15,521,240 221,072,949 14,314,944

- UCTRF office expenses (including Principal Officer expenses) of R1,585,148 (2013: R1,434,676) were paid to the University of Cape Town. The Principal Officer and staff of the office of the Principal Officer are employed by the University of Cape Town. The University of Cape Town invoices the Fund for these costs.

17.1. TRANSFERRED TO MEMBERS

30 June 2014

R

30 June 2013

RRetirement Expenses Retirement Expenses

Discretionary Retirement Savings * 46,437,082 (46,437,082) 42,348,594 (42,348,594)Risk Cost Savings* 804,386 (804,386) 775,126 (775,126)* (Refer note 11 ) 47,241,468 (47,241,468) 43,123,720 (43,123,720)

18. MEMBERS' INDIVIDUAL ACCOUNTS

30 June 2014R

30 June 2013R

Members' Individual Accounts - Active members 3,052,452,250 2,437,340,011Members' Individual Accounts - Deferred pensioners 99,587,521 68,911,198Timing difference between the administrator and the asset manager 15,397,646 8,960,0582012 Surplus allocation to be allocated to member records - 4,569,686

Total 3,167,437,417 2,519,780,953

- 34 -

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- 35 -

Page 36

SCHEDULE HB REPORT OF THE VALUATOR Particulars of financial condition of the fund:

1. Net assets available for benefits as at 30 June 2013 were R 2 810 652 000 (a)

.

2. The actuarial value of the net assets available for benefits, for the purposes of comparison with the actuarial present value of promised retirement benefits, was R 2 810 652 000 as at 30 June 2013.

3. The actuarial present value of promised retirement benefits(b),

split into vested(c)

and non-vested benefits are R 2 792 285 000 (all vested) as at 30 June 2013.

4. The total of the contingency reserve account balances recommended to and accepted by the Trustees was R 18 366 000. 5. Details of the valuation method adopted (including that in respect of any contingency reserve) and details of any changes since the

previous summary of report. Benefit obligations are the sum of the market values or fair values of the Accumulated Credits of in-service members, deferred

pensioners and pensioners (living annuitants) as at 30 June 2013. Assets backing benefit obligations and contingency reserves were taken at market value. There has been no change to the valuation method since the 30 June 2012 statutory valuation.

6. Details of the actuarial basis adopted (including that in respect of any contingency reserve) and details of any changes since the

previous summary of report. Assets at market/fair value including non-vested bonuses where applicable. Member Accumulated Credits at face value reflecting

market/fair value of corresponding assets. Data reserve targeted at 0.50% of total assets (unchanged since 2012 valuation). Processing Error reserve targeted at 0.25% of total assets in market-linked Portfolios C and D only (unchanged since 2012 valuation. Surplus Apportionment Expense Reserve set equal to accumulated value brought forward. General Reserve targeted at 6 months� estimated operating expenses (unchanged). Actual account balances have been used where these are lower than the targeted levels.

7. Any other particulars deemed necessary by the valuator for the purposes of this summary. The valuation report shows a nil surplus as at 30 June 2013.

8. A statement as to whether the Fund was in a sound financial condition for the purposes of the Pension Funds Act, 1956. I certify that the Fund was financially sound for the purposes of the Pension Funds Act as at 30 June 2013.

Prepared by me:

Erich Johann Potgieter (Towers Watson (Pty) Ltd) VALUATOR Fellow of the Actuarial Society of South Africa In my capacity as the valuator of the Fund and as an employee of Towers Watson (Pty) Ltd.

REMARKS For the purposes of this summary of report: (a) Net assets available for benefits are the fair value of the assets of the Fund less liabilities other than the actuarial present value of

promised retirement benefits. (b) The actuarial present value of promised retirement benefits means:

i. The actuarial liabilities in respect of past service benefits (including accrued bonus service) of active members, with due allowance for future salary increases where these affect the benefits in respect of past service, and with due allowance for increases in pension and deferred pensions at rates consistent with the pension increase policy of the Fund;

ii. The actuarial liabilities in respect of pensions in course of payment and deferred pensions, including any contingent annuity payable on the death of a pensioner, with due allowance for increases at rates consistent with the pension increase policy of the Fund; and

iii. Any other accrued liability. (c) Vested benefits are benefits, the right to which, under the conditions of the Fund, are not conditional upon continued employment.


SCHEDULE I

REPORT OF THE INDEPENDENT AUDITORS OF UNIVERSITY OF CAPE TOWN RETIREMENT FUND TO THE REGISTRAR OF PENSION FUNDS ON FACTUAL FINDINGS For the year ended 30 June 2014

38

Procedures Findings

Statement of Net Assets and Funds

1 Investments

1.1 Inspect the list of investment balances reflected in the general ledger of the Fund as at 30 June 2014 for any investments in accordance with the terms of section 19(4) of the Act.

1.1.1 Agree details of the written confirmations obtained from the investment managers/insurers to the investment balances reflected in the general ledger.

Details of the written confirmations obtained from the investment managers/insurers were agreed to the investment balances reflected in the general ledger.

1.1.2 Where investments held in the participating employer exceed 5% of the total assets as reflected in the financial statements, inspect the appropriate approval of the Registrar.

Not applicable as the fund holds no direct investments in participating employers.

1.2 Obtain the signed investment policy statement and, where applicable, the portfolio management agreement/investment mandate between the Fund and the investment administrator(s), and perform the following procedures on a sample of 10 mandates (comprising the 3 largest by value of investments at year end and 7 other randomly selected mandates):


SCHEDULE I


39

Procedures Findings

1.2.1 Inspect whether the underlying investments are in compliance with the signed investment policy statement and, where applicable, the portfolio management agreement/investment mandate.

The underlying investments, signed investment policy statement ("IPS") and investment mandate indicated the following:

Manager Underlying investment

Investment Mandate

Policy Statement

Sanlam Life Insurance

Cash Account

Not Available Not included

Prescient Investment Management (Pty) Limited

Managed Assets (Cash, Money Market, Bonds, and Forward Rate Agreements)

Multi managed balanced portfolio, investing in Shariah Compliant underlying investments, to produce a return of 0.5%

Not specific

MMI Group Limited

Non-Linked Policies

Guaranteed insurance policy

Not specific

Investec Asset Management (Pty) Limited

Managed Assets (Local Equity and Cash)

To produce a return of 5.0% p.a. in excess of the benchmark, gross of the asset manager's fees, over any rolling 5-year period.

Not specific

Allan Gray Investment South Africa Pty Ltd

Managed Assets (Local Equity, Cash, and Commodities)

To produce a return of 4.5% p.a. in excess of the benchmark, net of portfolio manager's fees and other costs, over a rolling 5 year period.

Not specific

Catalyst Fund Managers SA

Managed Assets (Local Equity and Cash)

To produce 1.5% return p.a. in excess of benchmark over a rolling 3 year period, gross of fees and taxes.

Not specific

Abax Investments (Pty) Limited

Collective Investment Schemes

To secure an optimum overall return, steady growth of income and preserve capital in real terms.

Not specific


SCHEDULE I


40

Procedures Findings

1.2.2 Inspect whether the investment mandate and the investment policy statement provide for securities lending transactions and investments in hedge funds, private equity funds and derivatives, as prescribed.

The investment policy statement does provide for investments derivative instruments.

1.2.3 Inspect whether the collateral and counterparty requirements as prescribed are complied with.

The collateral and counterparty requirements were complied with.

1.2.4 For segregated portfolios, confirm directly with the investment administrator(s):

(a) whether scrip lending took place during the year and, if so,

(b) whether there was collateral provided by the counterparty/(ies) for any scrip lending activities and, if so,

(c) the percentage exposure covered by the collateral.

Report on the amount for a).

No scrip lending took place during the year.

2 Member individual accounts (defined contributions funds as well as defined contribution section of hybrid funds)

2.1 Obtain a list of member individual accounts as reflected on the Statement of Net Assets and Funds as at 30 June 2014.

2.2 Select a random sample of the lesser of 25 or 10% of the number of members from the list of members and perform the following procedures:

2.2.1 Compare the member and employer contributions received and allocated for the members selected as reflected on the administrator’s system, to information supplied by the participating employers for those members selected, for a randomly selected period of three months (including the last month of the year under review).

The member and employer contributions received and allocated for the members selected as reflected on the administrator's system agreed to information supplied by the participating employers for the three months selected.

2.2.2 Compare the member and employer contribution rates for the members selected as reflected on the administrator’s system, to the rules of the Fund, for a randomly selected period of three months (including the last month of the year under review).

The member and employer contribution rates for the members selected as reflected on the administrator's system agreed to the rules of the Fund for the three months selected.


SCHEDULE I


41

Procedures Findings

2.2.3 In respect of unitised investment products, for the three months selected in 2.2.1 and 2.2.2, calculate the conversion of the contributions at the unit price per the administration system on the dates that the contributions were invested and compare the units recalculated to the administration system units for the selected members. Inspect that the units were added to the existing units for that member.

The conversion of contributions into units was calculated correctly and agreed to the units on the administration system. The units were added to the existing units for that member.

2.2.4 In respect of unitised investment products, calculate the conversion of units at the end of the year, at the year-end unit price per the administration system and agree the calculated amount to the member’s fund credit amount recorded in each member's record.

The conversion of the units was calculated correctly and agreed to the amount recorded in each member's record on the member register.

2.2.5 In respect of unitised investment products, compare the unit price(s) as per investment manager/actuary/other authorised party at the year-end to the unit prices on the administration system used to calculate each member‘s credits at year-end.

The unit price(s) agreed to the unit prices on the administration system at 30 June 2014.

2.2.6 In respect of non-unitised investment products, compare the interim and/or final return allocated to each individual member's account in the administrator's records for the year under review to the return approved in accordance with a resolution of the Board of Fund or the rules of the Fund or approved recommendation by the investment consultant/asset manager/fund valuator.

Not applicable as investments are unitised,

2.3 Obtain a list of members who switched investment portfolios during the year from the Fund/administrator, select a random sample of the lesser of 25 or 10% of members who switched between investment portfolios during the year, and perform the following procedures:

2.3.1 Inspect evidence that the portfolios were switched in accordance with notification of the member’s instruction/ investment strategy (including life stage models) of the Fund and within a timeframe as specified in the service level agreement or client mandate between the administrator and the Fund.

The portfolios were switched in accordance with notification of the member’s instruction/investment strategy (including life stage models) of the Fund and were switched within a timeframe as specified in the service level agreement or client mandate between the administrator and the Fund.

2.3.2 Inquire as to whether any fees relating to switches were deducted, and if so, inspect evidence of the approval by the Board of Fund and/or in terms of a service level agreement or client mandate.

Not applicable as fees were not deducted.


SCHEDULE I


42

Procedures Findings

2.4 For investment products obtain the Asset Liability Match (ALM) reconciliation per investment portfolio, excluding the reserve accounts, for member individual accounts from the administrator, and perform the following procedures:

2.4.1 Compare the investments per product on the ALM reconciliation to the investment certificates in total.

The investments per product agreed to the investment certificates in total.

2.4.2 Compare the member individual accounts on the ALM reconciliation per investment portfolio to the administration system and to the total member individual accounts as disclosed in the Statement of Net Assets and Funds.

The member individual accounts on the ALM reconciliation per investment portfolio agreed to the administration system and to the total member individual accounts as disclosed in the Statement of Net Assets and Funds.

2.4.3 Inspect whether the total mismatch (in Rand) for all portfolios was within the range as prescribed by the Registrar.

The total mismatch for all portfolios was within the range as prescribed by the Registrar.

3 Accumulated funds (for defined benefit funds as well as defined benefit sections of hybrid funds)

3.1 Select a sample of the lesser of 25 or 10% of the number of members from the list of members provided by the administrator and perform the following procedures for each member selected:

3.1.1 Compare the member contributions received and allocated for the members selected as reflected on the administrator’s system, to information supplied by the participating employers for those members selected, for a randomly selected period of three months (including the last month of the year under review).

The member contributions received and allocated for the members selected as reflected on the administrator's system agreed to information supplied by the participating employers for the three months selected.

4 Surplus apportionment scheme

4.1 If a surplus apportionment scheme was approved by the Registrar in the current year or if allocation and/or payments to members were made during the year, perform the following procedures:


SCHEDULE I


43

Procedures Findings

4.1.1 Active members:

Select a random sample of the lesser of 25 or 10% of number of active members to whom surplus has been apportioned in the approved surplus apportionment scheme and perform the following procedures:

4.1.1.1 Agree the original surplus amount allocated to the selected member to the individual allocation on the member records per the administration system.

The original surplus amount allocated to the selected member agreed to the individual allocation on the member records per the administration system.

4.1.1.2 Inspect whether the calculation of the relevant investment return from surplus apportionment date to date of allocation was in accordance with the requirements of the Act and allocated to the member records in the administration system.

The calculation of the relevant investment return from surplus apportionment date to date of allocation was in accordance with the requirements of the Act and was allocated to the member records in the administration system.

4.1.2 Former members and pensioners:

Select a random sample of the lesser of 25 or 10% of number of former members and pensioners as defined by the surplus apportionment scheme from the surplus schedules attached to the approved surplus apportionment scheme and perform the following procedures:

4.1.2.1 Agree the original surplus amount allocated to the selected member and/or pensioner to the individual allocation on the member records per the administration system.

The original surplus amount allocated to the selected member and/or pensioner agreed to the individual allocation on the member records per the administration system.

4.1.2.2 Inspect whether the calculation of the relevant investment return from surplus apportionment date to date of allocation was in accordance with the requirements of the Act and allocated to the member records in the administration system.

The calculation of the relevant investment return from surplus apportionment date to date of allocation was in accordance with the requirements of the Act and was allocated to the member records in the administration system.

4.1.2.3 Agree the total of the amount calculated in 4.1.2.1 and 4.1.2.2 to the surplus benefit paid per selected member and to the applicable amount per the administration system and other authorised supporting documentation.

The total amount calculated in 4.1.2.1 and 4.1.2.2 agreed to the surplus benefit paid per selected member and to the applicable amount per the administration system and other authorized supporting documentation.


SCHEDULE I


44

Procedures Findings

5 Member and employer surplus accounts

5.1 Obtain the analysis of the transactions in the member and/or employer surplus account per the annual financial statements, and perform the following procedure:

5.1.1 Inspect that the transactions are permitted in terms of the registered rules of the Fund and/or the Act.

The transactions were made in terms of the registered rules of the Fund and/or the Act.

6 Reserves

6.1 Obtain the list of reserves and other related accounts (e.g. pensioner accounts) and the movements per the financial statements and/or in the actuarial valuation, and perform the following procedures:

6.1.1 Inspect whether the reserve and other related accounts (e.g. pensioner accounts) held by the Fund and/or reflected in the actuarial valuation are in accordance with the registered rules of the Fund.

The reserve and other accounts (e.g. pensioner accounts) held by the Fund and/or reflected in the actuarial valuation were in accordance with the registered rules of the Fund.

6.1.2 Inspect that the movements in reserves as disclosed in the annual financial statements are permitted in terms of the registered rules of the Fund and/or the Act.

The movements in reserves as disclosed in the annual financial statements were permitted in terms of the registered rules of the Fund and/or the Act.

7 Other assets, liabilities and guarantees

7.1 Obtain the list of housing loans granted to members by the Fund in terms of section 19(5) of the Act as at 30 June 2014, and perform the following procedure:

7.1.1 Agree the total housing loans on the above list to the corresponding account in the annual financial statements.

Not applicable as no housing loans were granted by the fund.

7.2 From the list in 7.1, randomly select a sample of the lesser of 25 or 10% of the number of members’ housing loans granted and perform the following procedures:

7.2.1 Inspect evidence that the value of the housing loan provided does not exceed the amount permitted by the rules and the home loan agreement.

Not applicable.


SCHEDULE I


45

Procedures Findings

7.2.2 Inspect evidence that the housing loan has been granted in terms of Section 19(5) (a).

Not applicable.

7.2.3 Inspect evidence that repayments are being made in accordance with the housing loan agreement.

Not applicable.

7.2.4 Inspect the interest charged on the outstanding housing loan and compare the rate used to the prescribed rate.

Not applicable.

7.2.5 If the Fund issued more than 100 housing loans or the total principal debt of all outstanding loans exceeded R500 000, inquire whether the Fund was registered as a credit provider under the National Credit Act, 2005 (the NCA).

Not applicable.

7.3 Obtain the list of housing loan guarantees and select a sample of the lesser of 25 or 10% of the number of housing loan guarantees and perform the following procedures:

7.3.1 For the sample selected, determine that each selected housing loan guarantee did not exceed the gross value of the benefit that the member would become entitled to had they withdrawn, as at the year end, in terms of the Act, the loan agreement and/or the rules of the Fund.

Not applicable.

7.3.2 Inspect evidence that the housing loan guarantee has been granted in terms of Section 19(5) (a).

Not applicable.

7.4 Obtain a list of other loans per the general ledger of the Fund as at 30 June 2014 and perform the following procedure:

7.4.1 Confirm that no loans were granted and/or investments made as prohibited in terms of section 19(5)B.

Not applicable as no other loans were granted in terms of section 19(5)B.


SCHEDULE I


46

Procedures Findings

Statement of Changes in Net Assets and Funds

8 Contributions

8.1 Select a sample of the lesser of 25 or 10% of the number of participating employers or pay points (whichever is the lower) from a list of participating employer/pay-points supplied by the Fund/administrator, select three months and perform the following procedures:

8.1.1 Compare, in total, the contributions received by or on behalf of the Fund to the remittance advices from the participating employer/pay-point.

The contributions received by or on behalf of the Fund agreed to the remittance advice from the participating employer/pay-point.

8.1.2 Inspect the bank statements for the date on which the cash was received to determine whether the contributions were deposited with a registered bank in accordance with section 13A of the Act and whether late payment interest has been raised in terms of regulation 33, where applicable.

Contributions were deposited with a registered bank in accordance with section 13A of the Act and late payment interest had been raised in terms of regulation 33, where applicable.

8.2 Select a sample of the lesser of 25 or 10% of the number of participating employers or pay points which reflect arrear contributions (whichever is the lower) at year-end from a list supplied by the Fund/administrator and perform the following procedure:

8.2.1 Inspect the accounting records of the Fund to determine whether amounts disclosed as arrear contributions at year-end have been paid to the Fund within the prescribed period in accordance with the requirements of section 13A of the Act. Where the amounts were received after the prescribed period, report the date of receipt and where they were not received, indicate as such.

Not applicable as there were no arrear contributions.

9 Benefits

9.1 Obtain a list from the administration system of lump sum benefits reflected as expenses in the Fund’s Statement of Changes in Net Assets and Funds for the year under review and perform the following procedure:

9.1.1 Compare the list to the respective general ledger benefit expense accounts reconciliation.

The list agreed to the respective general ledger benefit expense accounts reconciliation.


SCHEDULE I


47

Procedures Findings

9.2 Select a sample of the lesser of 25 benefits or 10% of the total number of benefits from the list and perform the following procedures:

9.2.1 Compare the benefit per selected member to the administration system and authorised supporting documentation in accordance with the procedures of the Fund.

The benefit paid agreed to the administration system and authorised supporting documentation in accordance with the procedures of the Fund.

9.2.2 For death benefits, where a portion of the benefit had been reinsured by the Fund, inspect a bank deposit or an accrual raised for the recovery from the insurer.

The recovery from the insurer was received/accrued by the Fund.

9.2.3 For a defined benefit fund and hybrid funds with a defined benefit underpin

Inspect that the calculation of the benefit payment was done by the actuary in accordance with the requirements of the rules of the Fund and/or the Act.

For a defined contribution fund

Agree the opening fund credit for the member to the opening fund credit report and determine whether contributions were added every month until the date of exit (either by Rand amount or in the case of unitised funds, by units). Agree the balance paid out to the member (inclusive of late payment interest where applicable) to the fund credit report or administration system as at the date of exit.

Not applicable; not a defined benefit fund.

For a defined contribution fund

The opening fund credit for the member agreed to the opening fund credit report and contributions were added every month until the date of exit. The balance paid out to the member (inclusive of late payment interest where applicable) agreed to the fund credit report or administration system as at the date of exit.

9.3 Obtain a list of all benefits not yet paid at year-end, select a sample of the lesser of 25 benefits or 10% of the total number of benefits from the list and perform the following procedure:

9.3.1 Agree whether the benefits that are older than the period as set out in the Act or a shorter period defined by the Rules are classified as unclaimed benefits.

The benefits that were older than the period as set out in the Act or a shorter period defined by the Rules were classified as unclaimed benefits.

10 Transfers

10.1 Compare the list of total section 14 transfers to and from the Fund to the corresponding accounts in the general ledger.

The list of total section 14 transfers to and from the Fund agreed to the corresponding account in the general ledger.


SCHEDULE I


48

Procedures Findings

10.2 From the list of section 14 transfers paid/received and accrued to and from the Fund throughout the year select a sample of the lesser of 25 or 10% of the number of transfers in and the lesser of 25 or 10% of the number of transfers out, and perform the following procedures:

10.2.1 Agree the sample of section 14 transfers to and from the Fund to:

a) the section 14(1) documentation as approved by the Registrar in respect of each transfer; and/or

b) the section 14(8) documentation as prescribed.

The sample of section 14 transfers to and from the Fund agreed to:

a) the section 14(1) documentation as approved by the Registrar in respect of each transfer; and/or

b) the section 14(8) documentation as prescribed.

10.2.2 Inspect whether the transfers to and from the Fund were received/paid within 60 days of Registrar approval for section 14(1) transfers and 180 days from application date for section 14(8) transfers and whether the growth and investment return had been allocated from the effective date of the transfer to the date of final settlement.

The transfers to and from the Fund were received/paid within 60 days of Registrar approval for section 14(1) transfers and 180 days from application date for section 14(8) transfers and growth and investment return was allocated from the effective date of transfer to the date of final settlement.

10.2.3 In respect of unitised funds, select a sample of the lesser of 25 or 10% of the number of members transferred from other funds and recalculate the purchase of units for the amount received using the unit price per the administration system on the date of receipt. (Where units were purchased after date of receipt, investment return was added from the date of receipt to the date of purchase).

The conversion of transfers from other funds was correctly calculated and, where units were purchased after date of receipt, investment return was added from the date of receipt to the date of purchase.

10.3 Individual transfers

Obtain the list of individual transfers throughout the year ended 30 June 2014, select a sample of the lesser of 25 or 10% of the number of individual transfers, and perform the following procedures:

10.3.1 Agree the transfers to the approved recognition of transfer documentation.

The transfers agreed to the approved recognition of transfer documentation.


SCHEDULE I


49

Procedures Findings

10.3.2 For individual transfers in selected

In respect of unitised funds, recalculate the purchase of units for the amount received using the unit price per the administration system on the date of receipt. (Where units were purchased after date of receipt investment return was added from the date of receipt to the date of purchase).

The conversion of transfers from other funds was correctly calculated and, where units were purchased after date of receipt, investment return was added from the date of receipt to the date of purchase.

11 Pensioners paid

11.1 Obtain a copy of the list of pensioners and amounts paid for the year from the administration system and/or, for outsourced pensioners, confirmation from the insurer and perform the following procedure:

11.1.1 Agree the total pensions paid for the year ended 30 June 2014 to the corresponding account reconciliation to the general ledger balance.

The total pensions paid agreed to the corresponding account reconciliation to the general ledger balance for the year ended 30 June 2014.

11.2 Select a sample of the lesser of 25 or 10 % of the number of pensioners paid directly from the fund from the above list and perform the following procedures:

11.2.1 Inspect the pensioner increases for authorisation by the Board of Fund.

Not applicable as the pensioners are living annuitants and they set the level of pension for the period on an individual basis.

11.2.2 Inspect evidence obtained by the administrator/Fund supporting the fact that the pensioners selected exist.

The evidence indicated that the pensioners selected existed.

11.3 Where the Fund has purchased an annuity in the name of the Fund, obtain a written confirmation from the annuity provider summarising movements from opening market value to closing market value and perform the following procedures:

11.3.1 Agree the closing market value of the annuity to the annual financial statements.

The closing market value of the annuity agreed to the annual financial statements.


SCHEDULE I


50

Procedures Findings

11.3.2 Agree the pensioner payment per the confirmation from the insurer to the pensions paid disclosed in the notes to the annual financial statements.

The pensioner payment per the confirmation from the insurer agreed to the pensions paid disclosed in the notes to the annual financial statements.

General

12.1 Inspect evidence that the Fund’s fidelity insurance cover was in place throughout the year ended 30 June 2014, that the Fund’s fidelity insurance cover extends after year-end and report the date to which the subsequent fidelity insurance cover extends.

The Fund’s fidelity insurance cover was in place throughout the 2014 year ended 30 June 2014. The Fund’s fidelity insurance cover in place extended to 31 December 2015.

12.2 Confirm with the Fund’s GLA insurer as to whether the GLA policy has lapsed at year-end.

Per inspection of the GLA policy document the GLA policy has not lapsed at year-end.

12.3 Obtain the most recent statutory valuation signed and submitted by the valuator as at 30 June 2012 and perform the following procedures:

12.3.1 Report the funding status of the Fund per the report (whether the Fund was under-funded or fully funded).

Per the report the Fund was fully funded.

12.3.2 Where the Fund is under-funded, obtain evidence as to whether a scheme, as required in terms of section 18 of the Act in South Africa, has been approved by the Registrar.

Not applicable.

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- 51 -


SCHEDULE IA - SCHEDULES PERTAINING TO THE ANNUAL FINANCIAL STATEMENTS (continued)For the year ended 30 June 2014

A CASH

Local notes, deposits, money market instruments issued by a SouthAfrican Bank, margin accounts, settlement accounts with an exchange andIslamic liquidity management financial instruments

289,820,482

Notes and coins; any balance or deposit in an account held with a SouthAfrican bank; 76,415,708

ABSA Bank Ltd 4,020,843China Construction Bank 10,022,301Citibank 717,717Deutsche Bank 4,211Firstrand Bank Ltd, Incl RMB 362,299Hong Kong Shanghai Bank 15,248,268Nedbank Ltd 56,385,081Societe General South Africa 408,932Standard Bank of SA Ltd (10,753,944)

A money market instrument issued by a South African bank including anIslamic liquidity management financial instrument 204,156,740

ABSA Bank Ltd 48,476,155African Bank Ltd 1,529,408Firstrand Bank Ltd, Incl RMB 42,240,599Investec Bank Ltd 22,012,570Nedbank Ltd 60,357,793Standard Bank of SA Ltd 29,540,215

Any positive net balance in a margin account with an exchange1,723,894

SA Futures Exchange 185,762Variation Margin (3,202)ABSA Bank Ltd 1,541,334

Any positive net balance in a settlement account with an exchange,operated for the buying and selling of assets 7,524,140

Nedbank Ltd 7,524,140

Total 289,820,482

- 52 -



B COMMODITIES

Instrument Local or foreign Holding number Holding%

Fair valueR

LocalGold (including Kruger Rands)

New Gold Issuer Ltd Local 13,500 0.35 12,801,242

12,801,242Other

Africa Palladium Debenture Local 266 0.02 678,825New Gold Platinum ETF Local 13,500 0.04 1,499,575

2,178,400

14,979,642

Total 14,979,642

- 53 -

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- 59 -



L CERTIFIED REGULATION 28 COMPLIANT INVESTMENTS

Instrument Local orForeign Fair value

RCollective Investment Schemes � regulation 28(8)(b)(i)

Local

Prescient Life 27four Shariah Balanced Fund Local 71,435,339

Linked policies � regulation 28(8)(b)(ii)

Local

Metropolitan Smooth Growth Portfolio I4852 Local 162,269,840Metropolitan Smooth Growth Portfolio I4912 Local 747,045,161

Total certified Regulation 28 compliant investments

980,750,340

M REGULATION 28 NON-COMPLIANT INVESTMENTS

M1 NON-COMPLIANT COLLECTIVE INVESTMENT SCHEMESInstrument

Local

Local or Foreign Holding%

Fair valueR

Abax Equity Fund Local 217,065,670

217,065,670

Foreign

Pimco Global Investments Foreign 87,408,474Allan Gray Orbis Fund Foreign 412,032,790Stone Harbor Emerging Markets Fund Foreign 79,712,679

579,153,943

Total Non-compliant Collective investment schemes 796,219,613

O ENTITY / COUNTERPARTY EXPOSURECredit / Counter party risk

Counter party Directinvestment incounter party

Deposit/liquidasset with

counter party

Total perCounter Party

Exposure tocounter party asa % of the fair

value of theassets of the

fund

R R R

BanksABSA Bank Ltd 88,497,562 53,078,735 141,576,297 3.91

Asset managers -local 30,284,001 22,012,570 52,296,571Investec Ltd 21,688,426 22,012,570 43,700,996 1.21MMI Holdings Ltd 8,595,575 - 8,595,575 0.24

Asset managers -foreign 790,144,425 - 790,144,425Prescient Life Ltd 19,108,597 - 19,108,597 0.53Pimco Europe Ltd 87,408,474 - 87,408,474 2.41Allan Gray SA (Pty) Ltd 412,032,790 - 412,032,790 11.38Stone Harbor GlobalFunds Plc

75,653,564 - 75,653,564 2.09

MMI Holdings Ltd 195,941,000 - 195,941,000 5.41

908,925,988 75,091,305 984,017,293 27.18

- 60 -



Market risk

Equity Holdings

InvestmentFair value at end of year

R

Total fair value equityholdings and open

instrumentsR

Market movement by 5%R

Sasol Ltd 96,681,194 96,681,194 4,834,060British American Tobacco PLC 85,685,397 85,685,397 4,284,270Steinhoff International Holdings Ltd 65,787,508 65,787,508 3,289,375Standard Bank Group Ltd 56,967,600 56,967,600 2,848,380Reinet Investments SCA 53,131,594 53,131,594 2,656,580SABMiller PLC 50,200,717 50,200,717 2,510,036AngloGold Ashanti Ltd 42,708,721 42,708,721 2,135,436Old Mutual PLC 38,124,656 38,124,656 1,906,233Anglo American Platinum Ltd 34,873,952 34,873,952 1,743,698Remgro Ltd 34,836,950 34,836,950 1,741,848

Total value of 10 largest equity holdings 558,998,289 558,998,289 27,949,916

Total movement as % of non-current assetsplus bank

%0.77

Other Financial Instruments

Instrument

HoldingR

Fair value at end ofyear

R

Market movement by5%R

Metropolitan Smooth Growth Portfolio I4912 747,045,161 747,045,161 37,352,258Abax Equity Fund 217,065,670 217,065,670 10,853,284Metropolitan Smooth Growth Portfolio I4852 162,269,840 162,269,840 8,113,492Republic Of South Africa 159,136,589 159,136,589 7,956,829Nedbank Ltd 354,383,780 354,383,780 17,719,189Standard Bank of SA Ltd 119,135,545 119,135,545 5,956,777ABSA Bank Ltd 118,505,361 118,505,361 5,925,268Prescient Life 27four Shariah Balanced Fund 71,435,339 71,435,339 3,571,767Firstrand Bank Ltd, Incl RMB 70,204,930 70,204,930 3,510,247Transnet Ltd 31,171,129 31,171,129 1,558,556Total value of 10 largest other instruments

2,050,353,344 2,050,353,344 102,517,667

Total movement as % of non-current assets plusbank

%2.83

Foreign currency exposure

Foreign instruments

Fair value at end of yearR

Market movement by 5%R

Allan Gray SA (Pty) Ltd 412,032,790 20,601,640MMI Holdings Ltd 195,941,000 9,797,050Pimco Europe Ltd 87,408,474 4,370,424Prescient Life Ltd 19,108,597 955,430Stone Harbor Global Funds Plc 75,653,564 3,782,678Total value of 10 largest foreign instruments

790,144,425 39,507,222

Total movement as % of non-current assets plus bank %1.09

- 61 -

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- 62 -


SCHEDULE IBASSETS HELD IN COMPLIANCE WITH REGULATION 28For the year ended 30 June 2014

Fair valueR

Fair valueR

A Total assets of the fund as per Statement of Net Assets and Funds 3,620,847,126

B Less: Non-investment items of Statement of Net Assets and Funds: -B.1 Property Plant and Equipment -B.2 Current assets (excluding cash at bank) -

C Total assets (Regulation 28) (A � B) 3,620,847,126

D1 Less: Reg 28 compliant investments (certificate received from issuing entity):- 983,347,192D.1.1 Collective Investment Schemes (Reg 28(8)(b)(i)) -D.1.2 Linked Policies (Reg 28(8)(b)(ii)) -D.1.3 Guaranteed policies (Reg 28(8)(b)(iii)) 983,347,192D.1.4 Entity regulated by FSB (Reg 28(8)(b)(iv)) -D2 Less: Reg 28 Excluded investments -D.2.1 Insurance Policies ( Reg 28(3)(c)) -

E Less: Investments not disclosed /data not available for disclosure* -

C TOTAL ASSETS for REGULATION 28 DISCLOSURE 2,637,499,934

Categories of kinds of assets Fair valueR

Fair value%

1 CASH 303,879,661 11.52%

1.1 Local notes, deposits, money market instruments issuedby a South African Bank, margin accounts, settlementaccounts with an exchange and Islamic liquiditymanagement financial instruments

100%

295,025,717 11.19%(a) Notes and coins; any balance or deposit in an account

held with a South African bank; 81,473,337 3.09%Nedbank Ltd 25% 60,910,899 2.31%Hong Kong Shanghai Bank 25% 15,248,268 0.58%China Construction Bank 25% 10,022,301 0.38%ABSA Bank Ltd 25% 4,552,655 0.17%Other 25% (9,260,786) (0.35)%

(b) A money market instrument issued by a South Africanbank including an Islamic liquidity management financialinstrument

204,304,345 7.75%

Nedbank Ltd 25% 60,366,476 2.29%ABSA Bank Ltd 25% 48,526,080 1.84%Firstrand Bank Ltd, Incl RMB 25% 42,310,060 1.60%Standard Bank of SA Ltd 25% 29,559,751 1.12%Other 25% 23,541,978 0.89%

(c) Any positive net balance in a margin account with anexchange 1,723,895 0.07%

ABSA Bank Ltd 25% 1,541,334 0.06%SA Futures Exchange 25% 185,763 0.01%Variation Margin 25% (3,202) -%

(d) Any positive net balance in a settlement account with anexchange, operated for the buying and selling of assets 7,524,140 0.29%

Nedbank Ltd 25% 7,524,140 0.29%

1.2 Foreign balances or deposits, money market instrumentsissued by a foreign bank including Islamic liquiditymanagement financial instruments

SARBmax.limits 8,853,944 0.34%

(a) Any balance or deposit held with a foreign bank 8,827,896 0.33%

PIMCO Global Investment Fund 5% 6,916,654 0.26%Stone Harbor Emerging Markets Debt Blend Portfolio 5% 1,066,118 0.04%Orbis Global Equity Fund - Net current assets 5% 842,953 0.03%Abax Equity - US 5% 2,171 -%

(c) A money market instrument issued by a foreign bankincluding an Islamic liquidity management financialinstrument 26,048 -%

Standard Bank of SA Ltd 5% 26,048 -%

Carried forward 303,879,661 11.52%

- 63 -


SCHEDULE IB - ASSETS HELD IN COMPLIANCE WITH REGULATION 28For the year ended 30 June 2014


Fair value%

Brought forward 303,879,661 11.52%

2 DEBT INSTRUMENTS INCLUDING ISLAMIC DEBTINSTRUMENTS 678,279,756 25.72%

2.1 Inside the Republic 100% 524,105,341 19.87%(a) Debt instruments issued by, and loans to, the government

of the Republic, and any debt or loan guaranteed by theRepublic 100% 178,285,795 6.76%

Republic Of South Africa 25% 159,136,588 6.03%SA National Roads Agency Ltd 25% 15,226,397 0.58%Stone Harbor Emerging Markets Debt Blend Portfolio 25% 3,922,810 0.15%

(c) Debt instruments issued or by a South African bankagainst its balance sheet 75% 215,296,678 8.16%

c(i) Listed on an exchange with an issue market capitalisationof R20 billion or more, or an amount or conditions asprescribed 75% 214,914,433 8.15%

Standard Bank of SA Ltd 25% 89,688,668 3.40%ABSA Bank Ltd 25% 64,727,507 2.45%Nedbank Ltd 25% 31,238,054 1.18%Firstrand Bank Ltd, Incl RMB 25% 27,688,859 1.05%Other 25% 1,571,345 0.06%

c(ii) Listed on an exchange with an issuer market capitalisationof between R2 billion and R20 billion, or an amount orconditions as prescribed 75% 382,245 0.01%

African Bank Ltd 15% 382,245 0.01%c(iii) Listed on an exchange with an issuer market capitalisation

of less than R2 billion, or an amount or conditions asprescribed 75% - -%

per issuer/entity 10% - -%c(iv) Not listed on an exchange

25%- -%

per issuer/entity 5% - -%(d) Debt instruments issued or guaranteed by an entity that

has equity listed on an exchange, or debt instrumentsissued or guaranteed by a public entity under the PublicFinance Management Act, 1999 (Act No. 1 of 1999) asprescribed 50% 127,178,944 4.82%

d(i) Listed on an exchange 50% 127,178,944 4.82%

Transnet Ltd 10% 31,199,347 1.18%Development Bank of SA 10% 28,230,119 1.07%Southchester Conduit (RF Ltd 10% 10,047,904 0.38%Inguza Investments (Pty) Ltd 10% 8,017,313 0.30%Other 10% 49,684,261 1.88%

(e) Other debt instruments:- 25% 3,343,924 0.13%e(i) Listed on an exchange 25% 3,343,924 0.13%

Ivuzi Investments Ltd 5% 942,239 0.04%Indwa Investments (Pty) Ltd 5% 723,434 0.03%Blue Titanium Conduit Ltd 5% 527,459 0.02%Synthesis Funding Ltd 5% 432,272 0.02%Toyota Financial Services (SA) lTD 5% 209,378 0.01%Other 5% 509,142 0.02%

2.2 Outside the Republic

SARBmax.limits

154,174,415 5.85%(b) Debt instruments issued or guaranteed by the government

of a foreign country 82,239,057 3.12%Stone Harbor Emerging Markets Debt Blend Portfolio 25% 60,072,240 2.28%PIMCO Global Investment Fund 25% 22,166,817 0.84%

(c) Debt instruments issued or guaranteed by a South AfricanBank against its balance sheet:- - -%

(d) Debt instruments issued or guaranteed by an entity thathas equity listed on an exchange 66,726,555 2.53%

Carried forward 910,224,059 34.50%

- 64 -




Fair value%

Brought forward 910,224,059 34.50%

d(i) Listed on an exchange 66,726,555 2.53%

PIMCO Global Investment Fund 10% 52,211,349 1.98%Stone Harbor Emerging Markets Debt Blend Portfolio 10% 14,515,206 0.55%

(e) Other debt instruments 5,208,803 0.20%e(i) Listed on an exchange 5,208,803 0.20%

PIMCO Global Investment Fund 5% 5,208,803 0.20%

3 EQUITIES 1,532,628,519 58.11%

3.1 Inside the Republic 75% 1,129,205,267 42.81%(a) Preference and ordinary shares in companies, excluding

shares in property companies, listed on an exchange:-75%

1,126,541,915 42.71%a(i) Issuer market capitalisation of R20 billion or more, or an

amount or conditions as prescribed 75% 941,164,962 35.68%Sasol Ltd 15% 96,681,193 3.67%British American Tobacco PLC 15% 85,685,397 3.25%Steinhoff International Holdings Ltd 15% 65,787,508 2.49%Standard Bank Group Ltd 15% 56,967,600 2.16%Reinet Investments SCA 15% 53,131,594 2.01%SABMiller PLC 15% 50,200,717 1.90%AngloGold Ashanti Ltd 15% 42,708,721 1.62%Other 15% 490,002,232 18.58%

a(ii) Issuer market capitalisation of between R2 billion and R20billion, or an amount or conditions as prescribed 75% 176,663,950 6.70%

KAP Industrial Holdings Ltd 10% 15,538,747 0.59%Sun International Ltd 10% 14,812,600 0.56%Tongaat Hulett Ltd 10% 11,998,800 0.45%Illovo Sugar Ltd 10% 9,302,748 0.35%Trencor Ltd 10% 8,854,348 0.34%Reunert Ltd 10% 8,677,309 0.33%Other 10% 107,479,398 4.08%

a(iii) Issuer market capitalisation of less than R2 billion, or anamount or conditions as prescribed 15% 8,713,003 0.33%

Argent Industrial Ltd 5% 2,062,071 0.08%Comair Ltd 5% 1,267,840 0.05%Kelly Group SA Pty Ltd 5% 1,159,725 0.04%Stefanutti Stocks Holdings Ltd 5% 1,064,192 0.04%Other 5% 3,159,175 0.12%

(b) Preference and ordinary shares in companies, excludingshares in property companies, not listed on an exchange 15% 2,663,352 0.10%

Deutsche Bank Ag 2.5% 2,663,352 0.10%

3.2 Outside the Republic 403,423,252 15.30%

(a) Preference and ordinary shares in companies, excludingshares in property companies, listed on an exchange:-

SARBmax.limits 397,031,268 15.05%

a(i) Issuer market capitalisation of R20 billion or more, or anamount or conditions as prescribed 385,518,623 14.62%

NetEase - ADR 15% 17,875,807 0.68%Samsung Electronics 15% 17,727,396 0.67%Motorola Solutions 15% 14,021,968 0.53%Weatherford International 15% 13,938,292 0.53%Other 15% 321,955,160 12.21%

a(ii) Issuer market capitalisation of between R2 billion and R20billion, or an amount or conditions as prescribed 10,372,179 0.39%

Lightstream Resources 10% 2,471,837 0.09%XPO Logistics 10% 1,763,458 0.07%Hornbach Holding - Preference 10% 1,577,904 0.06%Cypress Semiconductor 10% 1,148,623 0.04%Other 10% 3,410,357 0.13%

a(iii) Issuer market capitalisation of less than R2 billion, or anamount or conditions as prescribed 1,140,466 0.04%

Johnston Press 5% 468,654 0.02%

Carried forward 2,507,724,140 95.07%

- 65 -




Fair value%

Brought forward 2,507,724,140 95.07%

Alchemia 5% 315,300 0.01%Phosphagenics 5% 141,014 0.01%Touchstone Exploration 5% 120,554 -%Other 5% 94,944 -%

(b) Preference and ordinary shares in companies, excludingshares in property companies, not listed on an exchange 6,391,984 0.24%

Saipem 2.5% 2,390,922 0.09%CEZ 2.5% 1,815,380 0.07%CNH Industrial (Milan) 2.5% 1,152,909 0.04%Finmeccanica 2.5% 915,208 0.03%Cloudary 2.5% 117,565 -%

4 IMMOVABLE PROPERTY 105,746,517 4.01%

4.1 Inside the Republic 25% 97,979,932 3.71%(a) Preference shares, ordinary shares and linked units

comprising shares linked to debentures in propertycompanies, or units in a Collective Investment Scheme inProperty, listed on an exchange 25% 97,979,932 3.71%

a(i) Issuer market capitalisation of R10 billion or more, or anamount or conditions as prescribed 25% 71,241,499 2.70%

Growthpoint Properties Ltd 15% 24,241,522 0.92%Redefine Properties Ltd 15% 10,804,449 0.41%Hyprop Investments Ltd 15% 8,916,073 0.34%Capital Properties Fund 15% 8,849,264 0.34%Other 15% 18,430,191 0.70%

a(ii) Issuer market capitalisation of between R3 billion and R10billion, or an amount or conditions as prescribed 25% 17,720,775 0.67%

Fortress Income Fund Ltd - A 10% 3,979,516 0.15%Fountainhead Property Trust 10% 3,143,901 0.12%Rebosis Property Fund Ltd 10% 2,116,757 0.08%Emira Property Fund 10% 1,947,133 0.07%Other 10% 6,533,468 0.25%

a(iii) Issuer market capitalisation of less than R3 billion or anamount or conditions as prescribed 25% 9,017,658 0.34%

Hospitality Property Fund Ltd 5% 3,467,797 0.13%Premium Properties Ltd 5% 1,746,630 0.07%Arrowhead Properties Ltd - A 5% 656,826 0.02%Tower Property Fund Ltd 5% 641,250 0.02%Other 5% 2,505,155 0.09%

4.2 Outside the Republic 7,766,585 0.29%(a) Preference shares, ordinary shares and linked units

comprising shares linked to debentures in propertycompanies, or units in a Collective Investment Scheme inProperty, listed on an exchange

SARBmax.limits 7,766,585 0.29%

a(i) Issuer market capitalisation of R10 billion or more, or anamount or conditions as prescribed 5,129,491 0.19%

MRV Engenharia 15% 2,620,869 0.10%Cyrela Brazil Realty 15% 2,508,622 0.10%

a(ii) Issuer market capitalisation of between R3 billion and R10billion, or an amount or conditions as prescribed 2,637,094 0.10%

PDG Realty 10% 2,376,423 0.09%Housing Development and Infrastructure 10% 260,671 0.01%

5 COMMODITIES 16,060,629 0.61%

5.1 Inside the Republic 10% 16,060,629 0.61%(a) Kruger Rands and other commodities on an exchange,

including exchange traded commodities 10% 16,060,629 0.61%a(i) Gold (including Kruger Rands) 10% 12,801,242 0.49%

New Gold Issuer Ltd 10% 12,801,242 0.49%a(ii) Other commodities 5% 3,259,387 0.12%

New Gold Platinum ETF 5% 2,580,562 0.10%

Carried forward 2,636,595,082 99.94%

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Fair value%

Brought forward 2,636,595,082 99.94%

Africa Palladium Debenture 5% 678,825 0.03%

5.2 Outside the Republic 10% - -%(a) Gold and other commodities on an exchange, including

exchange traded commodities 10% - -%

6 INVESTMENTS IN THE BUSINESS OF APARTICIPATING EMPLOYER INSIDE THE REPUBLIC INTERMS OF:- - -%

(a) Section 19(4) of the Pension Funds Act - -%

5% - -%

7 HOUSING LOANS GRANTED TO MEMBERS INACCORDANCE WITH THE PROVISIONS OF SECTION19(5)

95% - -%

8 HEDGE FUNDS, PRIVATE EQUITY FUNDS AND ANYOTHER ASSET NOT REFERRED TO IN THISSCHEDULE 904,852 0.03%

8.1 Inside the Republic 15% - -%(a) Hedge fund 10% - -%(b) Private equity funds 10% - -%

8.2 Outside the Republic 15% 904,852 0.03%(a) Hedge fund 10% - -%(b) Private equity funds 10% - -%(c) Other assets not referred to in this schedule and excluding

a hedge fund or private equity fund 2.5% 904,852 0.03%PIMCO Global Investment Fund 15% 904,852 0.03%

TOTAL (equal to the fair value of assets) 2,637,499,934 100.00%

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- 68 -

Documents

University of Cape Town Retirement Fund Financial Statements - … · 2014. 12. 11. · UNIVERSITY OF CAPE TOWN RETIREMENT FUND SCHEDULE E REPORT OF THE BOARD OF TRUSTEES As at 30