House keeping

When an employee leaves you

When a staff member leaves your employment you should forward an Employment Termination Advice (ETA) to us. This form lets us know when the employment ceased and whether or not you’ve paid all their superannuation contributions.

If there are outstanding contributions: when completing the ETA please answer ‘no’ to the question ‘have all contributions for this member been paid?’. You should also confirm the date on which you expect to make the final contribution, as shown in the example below:

When a member of Division B or D ceases employment due to retrenchment please ensure sections 3(1) and 3(2) of the ETA are completed.

Member numbers

All employees belonging to the Scheme have a member number that we assign.

When paying contributions to us, it’s important that you include the member number of every employee listed, so that we can allocate each contribution quickly and correctly.

If your payroll system is missing any member numbers, particularly for new employees, please call us on 1800 636 441 and we’ll be happy to help.

Tax File Numbers

Remember that you’re required to provide us with the Tax File Number (TFN) of any new employee. You’re required to do so within 14 days of receiving a TFN declaration from the employee, or when you make the first payment to the Scheme after receiving the TFN, whichever occurs first.

According to the ATO, it’s an offence not to provide an employee's TFN within the required timeframe. If you do not provide an employee’s TFN:

• You may be liable to pay a penalty, currently $1,100 per employee
• Your employees may have to pay extra tax on the contributions you make for them
• We won’t be able to accept personal contributions from the employee, meaning they may also miss out on government co-contributions.

PAYG payment summaries

Employer super contributions you make that an employee can influence, namely salary sacrifice contributions, must be recorded in the employee’s PAYG payment summary. It’s a requirement of the Taxation Administration Act 1953.

For Retirement Scheme members, all salary sacrifice payments need to be captured including:

• Salary sacrifice contributions of between 1% and 9% into the member’s Contributor Financed Benefit
• Salary sacrifice amounts made to the member’s Other Contributions Account.

For Defined Benefit Scheme members, all salary sacrifice payments need to be captured including:

• Salary sacrifice contributions for the purchase of units
• Salary sacrifice amounts made to the member’s Other Contributions Account.

However, you do not need to include Basic Benefit contributions and contributions to the employer financed benefit.

Quarterly SG contributions

Under the superannuation guarantee (SG) law, employers must pay super for any eligible employees. The minimum amount is 9% of an employee’s earning base each financial year. From 1 July 2008, an employee’s earning base is their Ordinary Time Earnings (OTE). Payment must be made at least quarterly by the cut-off date, which is 28 days after quarter-end, as set out in the table below.

The ATO imposes penalties if SG contributions are not made by the quarterly cut-off date. The penalty is an SG Charge (SGC). It is not tax deductible and is made up of three parts:

• SG shortfall amounts based on Ordinary Time Earnings (OTE)
• Interest on that amount (currently 10% pa)
• An administration fee of $20 per employee per quarter.

If the SGC isn’t paid by the due date the ATO can impose a General Interest Charge (GIC). This is calculated from the SGC due date and compounds daily until SGC and GIC are paid in full. The GIC is tax deductible in the year it is incurred.

Penalties may also apply for false or misleading statements, avoidance, failure to provide information or failure to keep SG records.

The ATO’s cut-off and lodgement dates are as follows:

EISS employers who make monthly contributions in accordance with the Scheme rules will more than satisfy these minimum requirements and will avoid the risk of late payment.

Keep us up-to-date

In order to provide great service to you, it’s helpful to know who the relevant people are in your organisation, such as SLOs, payroll contacts, general managers, finance managers and senior HR. We’d ask that you communicate any changes to these personnel to us.

Also, if you’re one of our key operational contacts, we’d ask that you let us know if you’re taking an extended period of time off work and who, if anyone, we should liaise with in your absence.

What’s happened in the markets?

Market review | September quarter 2011

The September quarter was one of the toughest in three years for share markets, as Euro concerns, US economic weakness and a Chinese slowdown weighed on investors’ minds.

Warnings early in the quarter of a possible US credit rating downgrade came to pass in August, with the US re-rated to AA+. The reason for the downgrade: concern over the US’s ability to continue servicing its debt obligations. Markets reacted meekly to the news with much of it already priced in, but it did little to ease investor concerns.

The US is trying to stimulate growth by keeping interest rates at near zero. But more is needed as consumers are neither spending nor investing, instead choosing to save and pay down debts.

In Europe, the concern over Greece’s ability to service its debt obligations spread to other countries. Greece is relatively inconsequential in a global economic perspective, but if Italy and Spain, in particular, were to default on their debt the consequences would be far greater. Negotiations continue in an attempt to tackle these issues. However, at the time of writing no agreement has been reached, and with every day that goes by, investors are becoming increasingly concerned over the eventual outcome.

Australia was not spared the market decline. An overall slowdown in global growth led investors to question Australia’s commodity-influenced share market. Australia’s direct links to Europe are limited, but China is showing signs of slower growth, which is likely to lead to a reduction in demand for raw materials and a consequent reduction in domestic economic growth.

Australian equities

The Australian share market benchmark, the S&P/ASX200 Accumulation Index, returned -11.6% for the quarter, the worst three-month return since December 2008. Investors were extremely nervous about the European crisis spreading to peripheral countries and continued slow growth in the US. Further, the Australian market suffered additional sell-offs as speculation grew that there would be a decline in demand from China.

International equities

In Australian terms, international shares performed poorly. The benchmark for global shares, the MSCI World ex-Australia Index returned -8.0% – and this takes into account a falling Australian dollar which assists global share returns.

Listed property

Australian listed property followed the broader equity market with the S&P/ASX200 A-REIT Accumulation Index down -8.0%. Globally, the returns were worse as the standard global listed property benchmark (the FTSE EPRA/NAREIT Developed Total Return Index) returned -15.5% on a currency hedged basis.

Cash and fixed interest

Interest rates in Australia remained at 4.75% during the quarter as the Reserve Bank of Australia deemed the current rate to be consistent with that for achieving its target rate of inflation.

Short term money markets produced average returns with the UBS Bank Bill Index finishing up 1.2% for the quarter. Meanwhile, investors continued to pile into the perceived ‘risk-free asset’ of government bonds with returns of 5.2% in both Australia and globally.*

Investment returns | September quarter 2011

Retirement Scheme Contributor Financed Benefit (CFB)

Accumulation & Executive Schemes

Strategy	Quarterly Returns
High Growth	-6.81
Diversified	-4.68
Balanced	-2.84
Capital Guarded	-0.50
Cash Plus	1.13

Contact Us

Phone
1800 636 441

Fax
(02) 9299 9321

Email for contribution returns
employeronline@eisuper.com.au

All other emails
employerservices@eisuper.com.au

Website
http://www.eisuper.com.au/

Mail
Energy Industries Superannuation Scheme
PO Box N835 Grosvenor Place
Sydney NSW 1220

Please note that the information contained in this document is of a general nature only and does not constitute personal advice as it does not take into account your personal objectives, financial situation or needs. Any advice in this document is provided by FuturePlus Financial Services Pty Ltd (ABN 90 080 972 630) as an Australian Financial Services Licensee (AFSL 238445) on behalf of the Trustee of the Energy Industries Superannuation Scheme, Energy Industries Superannuation Scheme Pty Ltd (ABN 72 077 947 285). Energy Industries Superannuation Scheme Pty Ltd is an APRA Registrable Superannuation Entity Licensee (RSE L000 1373) (ABN Pool A - 22 277 243 559 and ABN Pool B - 64 322 090 181). You should not rely solely on this information. Prior to making any investment decision you should obtain and consider the relevant Product Disclosure Statement (PDS) pertaining to your Scheme membership and seek professional investment advice.