CONTENTS New Employer Induction site Administration update A super shake up is under way Contribution caps Keep us up to date Investment returns Quarterly Superannuation Guarantee (SG) Contributions Would you like to see more of us? Office locations Are you sending your communications to the right place?

May 2010 Welcome In this edition of the Employer Newsletter, we detail our new employer web-based induction program which will be released in May. In addition to some administration updates, we report on a major review that could lead to far reaching changes in the superannuation system.

We also include a reminder about the need to be mindful of the fact that employees who salary sacrifice may be at risk of exceeding the new contribution caps this financial year.

As usual, we update you on the Energy Industries Superannuation Scheme's investment performance and our forthcoming seminar schedule.

We value your feedback, so please feel free to send us your comments or any suggestions on what articles you'd like to see in future newsletters by emailing: employerservices@eisuper.com.au

New Employer Induction site

We are working on a new site which will be located in the Employer section of the website that will provide a new staff member in payroll with all the basic information they might need to manage superannuation contributions and to give background information about how the different Divisions work.

There will be an overview of each Scheme Division, a guide to the procedure for setting up an account for a new employee as well as what to do when an employee is leaving, information about salary and super and a detailed guide to understanding the Retirement Scheme monthly invoice.

While the site has been designed for staff who might be unfamiliar with the EISS Schemes it can also be used as a reference point by more experienced staff.

Administration update

Member numbers in contribution files

We require member numbers on all contribution files. If you need to update missing member numbers on your payroll system please ring the Employer Helpline on 1800 636 441 and request a file of all your active members.

Contribution files

Please ensure that contribution files do not include formulas in the contributions fields and that the fields are set to two decimal places. When we convert the formulas or the contribution fields to two decimal places, discrepancies between file totals and the contribution payments can occur.

Please note that Accumulation Scheme files should not include negative contributions. If you have made an error and need money to be refunded, please email the details separately to employerservices@eisuper.com.au.

Make sure forms are current

Please ensure when you complete an employer form or provide an Application for Membership form to an employee, it is a current form. For legal reasons we are unable to accept old, out-of-date forms. Most current forms are available in the Forms section of the Energy Industries Superannuation Scheme website, or are otherwise available by emailing employerservices@eisuper.com.au or by calling the Employer Helpline on 1800 636 441.

A super shake up is under way

The Cooper Review

A major review that could lead to far reaching changes in the governance, efficiency, structure and operation of Australia's $1.23 trillion superannuation system is well under way.

The second phase preliminary report was released in late March 2010 and targets the back-office operations in super and proposes a number of measures designed to make these arrangements more efficient and more cost-effective.

The recommendations put forward by the panel have been given the title SuperStream. Specifically they relate to:

• Using industry-wide standards to improve the quality of data when members enter the system
• Electronic Funds Transfer (EFT) for all participants
• Better use of technology, including straight-through processing
• E-commerce solutions to replace paper
• Extending the use of the TFN as an identifier throughout the system
• Eliminating redundant processes, leading to simpler rollovers and consolidations.

It is estimated that these changes could lead to reduction of costs in the industry of more than $1 billion per year.

While many of the Cooper review's preliminary recommendations have been controversial and have received a mixed reception within the industry these proposals have attracted general industry support and have been welcomed warmly by most of the major industry bodies such as AIST(Australian Institute of Superannuation Trustees) and IFSA (Investment and Financial Services Association).

The panel is currently looking at phase three of the review which focuses on Structure (including self-managed super funds) and will provide its final preliminary recommendations before the end of the financial year.

Contribution caps

As the end of the financial year fast approaches, remember that those employees who salary sacrifice may be at risk of exceeding the new contribution caps and of incurring excess contributions tax.

In the May 2009 Federal Budget, the Government halved its cap on the amount of concessional (or pre-tax) contributions members can make to super to $25,000 a year (indexed). This change came into effect on 1 July 2009.

Income that's salary sacrificed as additional superannuation contributions is counted towards the concessional contributions cap, as is the 9% Superannuation Guarantee.

The transitional concessional contributions cap (for members aged 50 and over or who turn 50 before the end of the 2011/12 financial year) has also been reduced from $100,000 to $50,000 a year.

The annual cap on non-concessional or after-tax contributions remains at $150,000 per annum for the 2009/10 financial year. It will in future be calculated as six times the level of the (indexed) concessional contributions cap.

Excess concessional contributions are currently taxed at 31.5% in addition to the standard 15% contributions tax. So, to help your staff avoid any nasty surprises, it's important to review any salary sacrifice arrangements you make on their behalf. EISS has a procedure in place designed to alert members to the fact that they are approaching their concessional or non-concessional caps but this will not be foolproof as members may have super accounts elsewhere which we may know nothing about. In the end it is the member's responsibility to ensure that they don't exceed the caps but if we can help prevent it happening, it will make life easier for the members and for us.

Keep us up to date

Please keep us informed about any changes to your employer contact details or about any changes in personnel. We need to keep our contact information up to date (especially for payroll, HR/Finance Managers, and General Managers) so that we can communicate any important information regarding the Scheme or administrative changes efficiently and to the right people. Any updates can be emailed to: employerservices@eisuper.com.au

Investment returns

March 2010 quarter returns for the Contributor Financed Benefit - Retirement Scheme

Strategy	Quarterly Returns
High Growth	2.1%
Trustee Selection*	2.1%
Diversified	1.9%
Balanced	1.9%
Capital Guarded	1.7%
Cash	0.9%

All figures are shown to one decimal place. Returns may vary slightly between Divisions of the Scheme.
* Available to Retirement Scheme members only.

March 2010 quarter returns for the Accumulation Scheme

Strategy	Quarterly Returns
High Growth	1.9%
Diversified	1.7%
Balanced	1.7%
Capital Guarded	0.6%
Cash	0.9%

All figures are shown to one decimal place. Returns may vary slightly between Divisions of the Scheme.

Quarterly Superannuation Guarantee (SG) Contributions

Under the SG requirements all employers must contribute the minimum level of 9% of each eligible employee's earning base in super support for each financial year. The Superannuation Guarantee contribution is required to be contributed on at least a quarterly basis. From 1 July 2008, your employees' earning base is their ordinary times earnings (OTE).

The following describes the ATO deadlines for employer contributions and the penalties that may apply if employers do not meet them. Energy Industries employers who make monthly contributions in accordance with the Scheme rules will more than satisfy these minimum requirements and will therefore avoid any of the penalties listed.

The ATO imposes penalties if SG contributions are not made by the quarterly cut-off date by applying an SG Charge (SGC)* which is made up of three parts:

• SG shortfall amounts based on OTE
• Interest on that amount (currently 10% per annum)
• Administration fee of $20 per employee per quarter.

If the SGC and the SGC statement are not submitted by the due date for lodgement additional penalties may apply and these are:

• General Interest Charge (GIC) from the SGC due date will be incurred. GIC compounds daily until SGC and accrued GIC are paid in full. The ATO can reduce the penalty. GIC is tax deductible in the year it is incurred.



• An amendment in the SG legislation, from 24 June 2008, means that if an employer makes an SG contribution to a superannuation fund which is late, the employer can elect to have this contribution used to offset against the amount of SG charge they have to pay to the ATO for not meeting their superannuation obligations. Please refer to the ATO website for further information at www.ato.gov.au.



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

The following table obtained from the ATO lists the standard cut-off and lodgement dates.

Superannuation Guarantee quarter ended	Cut-off date for Superannuation Guarantee Contributions	Due date for lodgement of a SG statement and payment of the SG charge if contributions are not made on time
1 July - 30 Sept	28 October	28 November
1 Oct - 31 Dec	28 January	28 February
1 Jan - 31 March	28 April	28 May
1 April - 30 June	28 July	28 August

Would you like to see more of us?

As part of our service to you we offer free pre-retirement seminars to your employees, either on your site or at a venue close to you. If you'd like to organise a free seminar for employees, please call 1800 636 441.

Free pre-retirement planning seminars

Pre-retirement seminars are targeted at people who are over 50 years of age and provide information on the following: