OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS 1987 NO. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS 1987 NO. 322 - TABLE OF PROVISIONS 1. Citation 2. Commencement 3. Interpretation 4. Approved auditor 5. Standards relating to liens over benefits 6. Vesting or paying standards-funds in operation on 30 June 1986 7. Vesting standard-funds established on or after 1 July 1986 8. Vesting standard-contributions under prescribed agreements or awards 9. Preservation standards-prescribed agreements or awards etc. 10. Preservation standard-relevant arrangements or agreements 11. Preservation and portability standards 12. Preservation standards not to apply in certain cases 13. Standards relating to trustees-large funds 14. Standard relating to decisions by trustees 15. Standards relating to trustees-small funds 16. Investment standards 17. Financial reports and disclosure of information standards 18. Matters required in trust deeds of superannuation funds-standard 19. Approved trustee 20. Approved rules 21. Preservation and portability standards 22. Disclosure of information standards 23. Matters required in trust deeds of approved deposit funds-standard 24. Form of certificate by trustees and approved auditors 25. Prescribed fees SCHEDULE 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 1 Citation 1. These Regulations may be cited as the Occupational Superannuation Standards Regulations. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 2 Commencement 2. (1) Regulations 3, 7, 8, 9, 11, 12, 13, 15, 16 and 21 shall be taken to have come into operation on 1 July 1986. (2) Regulation 10 shall be taken to have come into operation on 22 December 1986. (3) Regulations 6 and 14 shall be taken to have come into operation on 1 July 1987. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 3 Interpretation 3. (1) In these Regulations, unless the contrary intention appears: "actuary" has the same meaning as in the Life Insurance Act 1945; "Commonwealth industrial authority" means any board, court, tribunal, body or person having authority under a Commonwealth Act to exercise any power of conciliation or arbitration in relation to industrial disputes; "defined benefit superannuation fund" means a fund the trust deed of which provides, in relation to one or more members of the fund, that that member, or each of those members, as the case may be, is or may be entitled, on his, her or their retirement from the workforce, to be paid a benefit defined in terms of, or in terms that include, either, or both, of the following amounts: (a) the amount of the relevant member's annual salary: (i) at the date of the member's retirement from the workforce; (ii) at a date prior to such retirement; or (iii) averaged over a period of employment prior to such retirement; (b) a specified amount; where some or all of the contributions to the fund (out of which, together with earnings on those contributions, the benefits are to be paid) are not paid into the fund, or accumulated in it, in respect of any individual member but are paid into and accumulated in the fund in the form of an aggregate amount. "eligible bank" means: (a) a savings bank or trading bank as defined by subsection 5 (1) of the Banking Act 1959; or (b) a public authority constituted by a law of a State or Territory, being a public authority that carries on banking business; "eligible financial corporation" means a registered corporation within the meaning of the Financial Corporations Act 1974, being a corporation that is: (a) a corporation to which that Act applies by reason of paragraph 8 (1) (a) or (b) of that Act; and (b) a financial corporation within the meaning of paragraph 51 (xx) of the Constitution; "employer" includes a person who engages another person to perform work under a subcontract; "employer representative", in relation to a board or committee of trustees of a superannuation fund, the board of a body corporate acting as the sole trustee of a superannuation fund or a management board, management committee or other management body that exercises actual control over the policies of a superannuation fund, means a member of that board, committee or body nominated by the employer or employers of the members of the fund or by an organisation nominated by that employer or those employers as representing the interests of that employer or those employers; "life assurance company" means: (a) a company registered under section 19 of the Life Insurance Act 1945; or (b) a public authority constituted by a law of a State or Territory, being a public authority that carries on life insurance business within the meaning of subsection 4 (1) of that Act; "life policy" has the same meaning as in the Life Insurance Act 1945; "member-financed benefits" means: (a) where the amount of benefits that are vested in a member of a superannuation fund on withdrawal from the fund is calculated on the basis of contributions made to the fund or on the basis of such contributions together with earnings based on those contributions-the amount of contributions made by the member, together with the net earnings of the fund that are allotted to the member, in accordance with the terms of the trust deed, on the basis of those contributions; (b) where the amount of benefits that are vested in a member of a superannuation fund on withdrawal from the fund is calculated on the basis of the benefits purchased under an endowment or whole of life policy-the amount of the benefits purchased by contributions made by the member to that policy, whether payment of the benefits pursuant to the policy is to be made on death, retirement, disablement or the occurrence of some other event; and (c) where the amount of benefits that are vested in a member of a superannuation fund on withdrawal from the fund is defined in terms that include the member's salary at the date of withdrawal from the fund or at a date prior to such withdrawal or averaged over a period of employment prior to such withdrawal-benefits calculated in accordance with subregulation (5), together with the net earnings of the fund that are allotted to the member, in accordance with the terms of the trust deed, on the basis of such of those last-mentioned benefits as have been preserved in the fund; "member representative", in relation to a board or committee of trustees of a superannuation fund, the board of a body corporate acting as the sole trustee of a superannuation fund or a management board, management committee or other management body that exercises actual control over the policies of a superannuation fund, means a member of that board, committee or body nominated by the members of the fund or by a trade union or other organisation representing the interests of those members; "prescribed agreement or award" means an agreement or award (including a consent award) that is certified or made by a Commonwealth industrial authority or a State industrial authority on or after 1 July 1986; "registered auditor" means a person registered as an auditor, or deemed to be registered as an auditor, under the Companies Act 1981 or a law of a State or Territory relating to companies; "registered medical practitioner" means a person who is registered as a medical practitioner under a law of a State or Territory providing for the registration of medical practitioners; "registered organisation" means: (a) an association registered under a law of a State or Territory as a trade union; (b) a society registered under a law of a State or Territory providing for the registration of friendly or benefit societies; and (c) an association of employees that is registered as an organisation under the Conciliation and Arbitration Act 1904; "related entity", in relation to a fund, means a corporation that is, under subsection 7 (5) of the Companies Act 1981, deemed to be related to the trustee or to any of the trustees, as the case may be, of the fund for the purposes of that Act; "State industrial authority" means: (a) any board or court of conciliation or arbitration, or tribunal, body or person, having authority under any State law to exercise any power of conciliation or arbitration in relation to industrial disputes within the limits of the State; or (b) any special board constituted under any State law relating to factories; "the Act" means the Occupational Superannuation Standards Act 1987. (2) For the purposes of these Regulations, a reference to contributions to a superannuation fund made by a member of the fund shall be read as including a reference to: (a) an amount transferred to that fund by another superannuation fund or by an approved deposit fund in respect of the member, being a benefit from the other fund that had, prior to that transfer, become vested in the member; and (b) contributions made by the member to the fund that are remitted to the fund by the member's employer or some other person on behalf of that member other than contributions made by a member's employer to a superannuation fund on the employer's own behalf. (3) For the purposes of these Regulations, a reference to the net earnings of a superannuation fund shall be read as a reference to the amount of the earnings of the fund after deducting the amount of such administrative and other costs as are attributable to the amount of contributions received by the fund and after allowing for any averaging of the earnings of the fund, in accordance with the trust deed, to take into account possible or actual periodic fluctuations in those earnings. (4) For the purposes of these Regulations, a reference to contributions to a superannuation fund made by an employer of a member of the fund shall be read as including a reference to contributions to the fund made by or on behalf of any person other than that member. (5) Benefits shall be calculated as follows for the purposes of paragraph (c) of the definition of member-financed benefits in subregulation (1): (a) where, throughout the period during which the member has contributed to the fund, contributions have been made by the member at the same rate-an amount calculated in accordance with the formula: R x N x S --------- 12 where: R is the rate, expressed as a percentage of the member's salary, at which contributions are, or have been, made to the fund by the member; N is the number of months that the member has contributed to the fund at that rate; and S is the amount of the member's salary at the date of withdrawal from the fund or at a date prior to such withdrawal or averaged over a period of employment prior to such withdrawal, as the case requires; and (b) where, in respect of 2 or more periods within the period during which the member has contributed to the fund, the contributions have been made by the member at different rates-the sum of the amounts calculated by applying the formula specified in paragraph (a) in respect of each of such first-mentioned periods as if, for the purpose of ascertaining the relevant rate and number of months, that period were the whole of the period during which the member has contributed to the fund. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 4 Approved auditor 4. (1) For the purposes of the definition of "approved auditor" in subsection 3 (1) of the Act, the following classes of persons are specified in relation to a superannuation fund: (a) persons who are independent registered auditors; (b) where all assets of the superannuation fund are in the form of life policies or deposits at call with an eligible bank or the superannuation fund has 5 members or less and those members agree not to require a registered auditor-persons who: (i) are members of the Institute of Chartered Accountants, the Australian Society of Accountants or the Institute of Affiliate Accountants; (ii) are not trustees or members of, or contributors to, the fund, members of a management board, committee or other body exercising actual control over the policies of the fund or partners, employees or officers of such trustees, members or contributors; and (iii) do not have actual control over the investments or administration of the fund and are not partners, employees or officers of persons having such control. (2) For the purposes of the definition of "approved auditor" in subsection 3 (1) of the Act, the following class of persons is specified in relation to an approved deposit fund, namely, persons who are independent registered auditors. (3) For the purposes of this regulation, a registered auditor shall not be regarded as independent in relation to a superannuation fund or an approved deposit fund if the auditor is a trustee or member of, a depositor with, or a contributor to, the fund, a member of a management board, committee or other body exercising actual control over the policies of the fund, a person having actual control over the investments or administration of the fund, or a partner, employee or officer of such a trustee, member, depositor, contributor or person. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 5 Standards relating to liens over benefits 5. For the purposes of subsection 7 (1) of the Act, the following standard is prescribed in relation to the exercise of liens over benefits vested in members of, or preserved by, superannuation funds, namely, an employer or any other person who contributes to the fund shall not: (a) exercise a lien over any benefits that are required by the standards prescribed in this Part to be vested in a member of the fund or to be preserved by the fund; and (b) where, at the commencement of this regulation, such a lien has been exercised over such benefits-enlarge the scope of that lien in any way or otherwise vary it except by way of limitation or removal of that lien. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 6 Vesting or paying standards-funds in operation on 30 June 1986 6. (1) For the purposes of subsection 7 (1) of the Act, the following standards are prescribed in relation to the vesting in or payment to members or former members of benefits arising directly or indirectly from amounts contributed to superannuation funds in operation on 30 June 1986: (a) subject to paragraph (b), in respect of any member who was a member of the fund on or after 11 June 1986, the following benefits, being or arising from contributions to a superannuation fund made by a member, shall vest in that member, in the case of the benefits referred to in subparagraphs (i) and (ii), on 1 July 1987, and in the case of the benefits referred to in subparagraphs (iii) and (iv), on 1 July 1987 or, where the benefits accrue after that date, at the time those benefits accrue: (i) where the amount of benefits is not based on benefits purchased under an endowment or whole of life policy-the total amount of contributions to the fund made by the member during the period commencing on the day on which the member became such a member and ending at the expiration of: (A) 30 June 1987; or (B) the day on which the member ceased to be a member; whichever happens first; (ii) where the amount of benefits is based on benefits purchased under an endowment or whole of life policy-the total amount of benefits arising from contributions to the fund made by the member under that policy during the period commencing on the day on which the member became such a member and ending at the expiration of: (A) 30 June 1987; or (B) the day on which the member ceased to be a member; whichever happens first; (iii) where the amount of benefits that are vested in the member on withdrawal from the fund is calculated on the basis of contributions made to the fund or on the basis of such contributions together with earnings based on those contributions-the net earnings of the fund arising on and after 1 July 1987 that are allotted to the member on the basis of the amount referred to in subparagraph (i); (iv) the total amount of member-financed benefits accruing to the member on or after 1 July 1987; (b) a person who: (i) was a member of the fund on or after 11 June 1986; (ii) ceased to be such a member before the expiration of 30 June 1987; and (iii) did not elect to preserve his or her contributions to the fund under the rules of the fund; shall be paid, not later than 30 June 1988: (iv) where the amount of benefits is not based on benefits purchased under an endowment or whole of life policy-an amount equal to the total amount of contributions to the fund made by the person during the period commencing on the day on which the person became such a member and ending at the expiration of the day on which the person ceased to be such a member; and (v) where the amount of benefits is based on benefits purchased under an endowment or whole of life policy-the total amount of benefits arising from contributions to the fund made by the member under that policy. (2) A reference in subregulation (1) to contributions to a fund made by a member or by a person shall not be read as including a reference to any earnings of the fund on those contributions or to any amount: (a) paid out of those contributions; or (b) allocated out of those contributions to a separate account on the basis of advice provided by an actuary; in accordance with the terms of the trust deed of the fund, by or on behalf of the member or person, as the case may be, solely for death or disability cover. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 7 Vesting standard-funds established on or after 1 July 1986 7. For the purposes of subsection 7 (1) of the Act, the following standard is prescribed in relation to the vesting in members of benefits arising directly or indirectly from amounts contributed to superannuation funds established on or after 1 July 1986, namely, in respect of the total amount of member-financed benefits accruing to a member from the day on which a superannuation fund is established, the benefits shall vest in that member on the day on which the benefits accrue. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 8 Vesting standard-contributions under prescribed agreements or awards 8. For the purposes of subsection 7 (1) of the Act, the following standard is prescribed in relation to the vesting in members of benefits arising directly or indirectly from amounts contributed to superannuation funds, namely, in respect of the total amount of any benefits, other than death or disability benefits, arising directly or indirectly from contributions made by an employer in relation to a member of a superannuation fund in accordance with a prescribed agreement or award, the benefits shall vest in the member on the date on which the benefits accrue, being a date on or after the date of effect of the agreement or award. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 9 Preservation standards-prescribed agreements or awards etc. 9. For the purposes of subsection 7 (1) of the Act, the following standards are prescribed in relation to the preservation of benefits arising directly or indirectly from amounts contributed to superannuation funds: (a) in relation to each member of a superannuation fund, the amount of any benefit vested in that member in accordance with the standard set out in regulation 8 shall be preserved; (b) in relation to each member of a superannuation fund, any amounts transferred to the fund in relation to the member under regulation 11 shall be preserved. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 10 Preservation standard-relevant arrangements or agreements 10. (1) For the purposes of subsection 7 (1) of the Act, the following standard is prescribed in relation to the preservation of benefits arising directly or indirectly from amounts contributed to superannuation funds, namely, in relation to each member of a superannuation fund, the amount of any new employer-financed benefits, or of any improvement in employer-financed benefits (including benefits arising from improvements in vesting) vested in that member and arising from any relevant arrangement or agreement shall be preserved. (2) In this regulation, "relevant arrangement or agreement" means any arrangement or agreement made on or after 22 December 1986 (other than a prescribed agreement or award) under which new or additional employer-financed benefits under a superannuation fund are conferred on some or all members of the fund. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 11 Preservation and portability standards 11. For the purposes of subsection 7 (1) of the Act, the following standards are prescribed in relation to the preservation and portability of benefits arising directly or indirectly from amounts contributed to superannuation funds: (a) in relation to each member of a superannuation fund, the benefits referred to in regulations 9 and 10, except to the extent to which those benefits become payable on the retirement of the member from the workforce before attaining the age of 55 years in the form of a non-commutable pension payable for life, shall be preserved until: (i) those benefits are transferred in accordance with paragraph (c); (ii) the member has: (A) retired from the workforce; and (B) attained an age of not less than 55 years; or (iii) those benefits become payable in one of the following circumstances: (A) the retirement of the member from the workforce before attaining the age of 55 years on the ground of permanent incapacity or permanent invalidity; (B) the death of the member; (C) the permanent departure of the member from Australia; (D) such other circumstances (if any) as the Commissioner approves; (b) a member seeking payment of benefits from a superannuation fund on his or her retirement from the workforce on the ground of permanent incapacity or permanent invalidity shall be required to give to the trustees of the fund a certificate signed by 2 registered medical practitioners certifying that, in the opinion of those medical practitioners, the member is unlikely ever to be able to work again in a job for which the member is reasonably qualified by education, training or experience; (c) where a person who was a member of a superannuation fund withdraws from the fund in circumstances other than those specified in subparagraph (a) (ii) or (iii), all benefits to which a person is entitled on such withdrawal and that are required to be preserved in relation to the person shall be: (i) retained in the fund; or (ii) transferred directly to, for preservation in relation to the person in: (A) another superannuation fund nominated by the person, being a superannuation fund of which the person is, or intends to become, a member and that is required to preserve any benefits so transferred in accordance with the standards set out in this regulation; (B) an approved deposit fund nominated by the person, being a fund that is required to preserve any benefits so transferred in accordance with the standards set out in these Regulations; or (C) a deferred annuity nominated by the person, being a deferred annuity that cannot be surrendered or assigned before the person attains the age of 55 years and that does not pay benefits except in the circumstances specified in subparagraph (a) (ii) or (iii). 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 12 Preservation standards not to apply in certain cases 12. The standards set out in regulations 9, 10 and 11 do not apply in relation to the preservation of any benefits in respect of a person where the total amount of the benefits is less than $500. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 13 Standards relating to trustees-large funds 13. For the purposes of subsection 7 (1) of the Act, the following standards are prescribed in relation to the number of trustees of, the composition of boards or committees of trustees of, and certain other boards, committees or bodies relating to, each superannuation fund established on or after 16 December 1985 and having 200 or more members (in this regulation called "a large fund") and in relation to matters permitted to be included in the trust deed of each such fund: (a) a board or committee of trustees of a large fund shall, subject to paragraph (e), comprise equal numbers of member representatives and employer representatives; (b) where the trust deed of a large fund provides for the establishment or appointment of a management board, management committee or other management body, being a board, committee or body that exercises actual control over the policies of the fund, the board, committee or body shall, subject to paragraph (e), comprise equal numbers of member representatives and employer representatives; (c) where the trust deed of a large fund provides for a body corporate to act as the sole trustee of the fund and paragraph (b) does not apply, the board of the body corporate shall, subject to paragraph (e), comprise equal numbers of member representatives and employer representatives; (d) the trust deed of a large fund may provide for: (i) the appointment of an independent additional trustee to a board or committee of trustees of the kind referred to in paragraph (a); or (ii) the appointment of an independent additional member of: (A) a board, committee or other body of the kind referred to in paragraph (b); or (B) a board of a body corporate of the kind referred to in paragraph (c); where such an appointment is requested by the member representatives or the employer representatives who are members of the board, committee or other body; (e) the trust deed of a large fund may, with the written approval of the Commissioner given either generally or in relation to a particular case or a particular class of cases and subject to such conditions (if any) as are specified in the approval, provide for: (i) the establishment of: (A) a board or committee of trustees of the kind referred to in paragraph (a); or (B) a board, committee or other body of the kind referred to in paragraph (b); that is not comprised of equal numbers of member representatives and employer representatives; or (ii) a body corporate of the kind referred to in paragraph (c) to act as the sole trustee, being a body corporate the board of which is not comprised of equal numbers of member representatives and employer representatives; (f) where: (i) an independent additional trustee is appointed to a board or committee of trustees of the kind referred to in paragraph (a); or (ii) an independent additional member is appointed to: (A) a board, committee or other body of the kind referred to in paragraph (b); or (B) a board of a body corporate of the kind referred to in paragraph (c); the additional trustee or member, as the case may be, shall not be entitled to a casting vote in any proceedings of the board, committee or body to which he or she is appointed; (g) where, for any reason, a vacancy occurs in the membership of a board or committee of trustees of the kind referred to in paragraph (a), a board of a body corporate of the kind referred to in paragraph (c), or a board, committee or other body of the kind referred to in paragraph (b), a person shall be appointed to fill that vacancy within 60 days after the day on which the vacancy occurs. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 14 Standard relating to decisions by trustees 14. (1) For the purposes of subsection 7 (1) of the Act, the following standard is prescribed in relation to the operation of each large fund, namely, a decision by a board or committee of trustees of the kind referred to in paragraph 13 (a), a board of a body corporate of the kind referred to in paragraph 13 (c), or a board, committee or other body of the kind referred to in paragraph 13 (b), shall require not less than two-thirds of the total number of the members of the board, committee or other body, as the case may be, to have voted in favour of the decision. (2) In this regulation, "large fund" has the same meaning as in regulation 13. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 15 Standards relating to trustees-small funds 15. (1) For the purposes of subsection 7 (1) of the Act, the following standards are prescribed in relation to trustees of, the composition of boards or committees of trustees of, and certain other boards, committees or bodies relating to, each superannuation fund established on or after 16 December 1985 and having less than 200 members (in this regulation called "a small fund"): (a) either: (i) the relevant standards set out in paragraphs 13 (a), (b), (c) and (d) shall apply to a small fund as though a reference in any of those paragraphs to a large fund were a reference to a small fund and the words "subject to paragraph (e)" in any of those paragraphs were deleted; or (ii) a small fund shall have one or more trustees appointed following nomination by agreement between the members of the fund (or a trade union or other organisation representing the interests of those members) and the employer or employers of those members (or an organisation nominated by that employer or those employers as representing the interests of that employer or those employers); (b) a trustee or trustees referred to in subparagraph (a) (ii) shall not be removed from office except in such circumstances, if any, as are specified in the trust deed or as were determined at the time of the nomination referred to in that subparagraph; (c) where, for any reason, a vacancy occurs in the membership of a board or committee of trustees of a small fund, a board of a body corporate that is the sole trustee of the fund or a management board, management committee or other management body exercising actual control over the policies of the fund, a person shall be appointed to fill that vacancy within 60 days after the day on which the vacancy occurs. (2) Where, following a nomination referred to in subparagraph (1) (a) (ii), a body corporate is appointed as trustee of a small fund, it shall not be necessary for the board of that body corporate to comprise equal numbers of member representatives and employer representatives. (3) For the purposes of subsection 7 (1) of the Act, the following standard is prescribed, namely, where a small fund ceases to be such a fund by reason of acquiring 200 or more members, the trustees of the fund shall, as soon as practicable but in any event not later than 90 days after the fund ceases to be a small fund, make such arrangements (if any) as are necessary to enable the fund to comply with the standards set out in regulations 13 and 14 and until such arrangements are made or the period of 90 days expires, whichever happens first: (a) the fund shall not be required to comply with the standards set out in regulations 13 and 14; and (b) the standards set out in this regulation shall continue to apply in relation to the fund. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 16 Investment standards 16. (1) For the purposes of subsection 7 (1) of the Act, the following standards are prescribed in relation to the investment of assets of superannuation funds and borrowing by trustees: (a) subject to subregulation (2), money of a superannuation fund shall not be lent to any of the fund's members, either directly or by means of arrangements being entered into for lending money to the members in the exercise of a general power of investment of assets of the fund; (b) subject to subregulation (3), the trustees of a superannuation fund shall not borrow, or maintain an existing borrowing of, money, whether by way of a secured or unsecured loan, otherwise than to secure temporary finance by way of overdraft with an eligible bank; (c) all investments of any of the assets of a superannuation fund, other than a prescribed investment, shall be made on an arms length basis. (2) Where the trustees of a superannuation fund established before 16 December 1985 were on that day, and have since continued to be, empowered by the fund's trust deed to lend money to its members, compliance with the standard set out in paragraph (1) (a) is not required but the trust deed shall not, on or after the commencement of this regulation, be amended so as to enlarge the scope of that power by removing or altering any limitation or restriction to which that power was subject immediately before that day. (3) Where the trustees of a superannuation fund had, on or before 11 June 1986, borrowed money in a manner that does not comply with the standard set out in paragraph (1) (b), the trustees shall, as soon as practicable but in any event not later than the expiration of 30 June 1995, make such arrangements as are necessary to enable compliance with that standard and, until such arrangements are made or the expiration of 30 June 1995, whichever happens first, that standard shall not apply in relation to the fund in respect of the money borrowed by the trustees on or before 11 June 1986. (4) In this regulation, "prescribed investment", in relation to a superannuation fund, means an investment that is an in-house asset of the fund within the meaning of section 121C of the Income Tax Assessment Act 1936, as in force at the commencement of this regulation, the cost of which, together with the cost of any other in-house assets of the fund, does not exceed, at any time during a year of income, the amount calculated in accordance with subsection 121C (4) or subsections 121C (5) and (6) of that Act as so in force, as the case requires. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 17 Financial reports and disclosure of information standards 17. (1) For the purposes of subsection 7 (1) of the Act, the following standards are prescribed in relation to the financial and actuarial reports to be prepared in relation to superannuation funds, the reduction of benefits and the disclosure of information to members of superannuation funds: (a) in relation to a defined benefit superannuation fund, an actuarial investigation shall be made: (i) where the fund is in operation on the date of commencement of this regulation and an actuarial investigation has been made into the fund within the preceding period of 2 years-as at a date within the period of 3 years commencing on the date as at which the last actuarial investigation was made; (ii) where the fund is in operation on the date of commencement of this regulation and an actuarial investigation has not been made into the fund within the preceding period of 2 years-as at a date not later than: (A) 3 years after the date on which the fund came into operation; or (B) 1 January 1989; whichever is the later; and (iii) in any other case-as at a date within the period of 3 years commencing on the date on which the fund comes into operation; and thereafter regular actuarial investigations shall be made, each of them being as at a date not later than 3 years after the previous date as at which an actuarial investigation was made; (b) in relation to a defined benefit superannuation fund, an actuarial report shall be required to be given to the trustee or trustees of the fund, in relation to each investigation referred to in paragraph (a), within the period of 12 months commencing on the day following the day as at which each such investigation is made or within such extended period as the Commissioner allows, being a report containing the matters specified in subregulation (2); (c) an audit of the accounts and records of a superannuation fund shall be required to be carried out, after the end of each year of income of the fund but not later than the day by which the return referred to in subsection 12 (1) of the Act is to be given to the Commissioner, by an approved auditor and an auditor's report shall be required to be given to the trustee or trustees of the fund in respect of each such audit; (d) except with the written approval of the Commissioner or of all of the members of a superannuation fund: (i) the trust deed of the fund shall not be amended so as to reduce any benefits that have accrued to any of its members, or affect the basis for calculating the amount of retirement benefits of any of its members in a way that reduces that amount with respect to the period of membership before the date of the alteration of the deed; and (ii) a retrospective reduction in benefits accrued or payable to any of its members shall not otherwise be permitted; (e) the trustee or trustees of a superannuation fund shall give to each member of the fund, as soon as practicable after the end of the year of income of the fund commencing on 1 July 1988 and of each succeeding year of income (but, in any event, within 6 months after the end of each such year), a written statement setting out: (i) where the amount of benefits that are vested in a member of a superannuation fund on withdrawal from the fund is calculated on the basis of contributions made to the fund or on the basis of such contributions together with earnings based on those contributions-the following particulars: (A) the amount of the benefits vested in the member at the commencement of the first day of the year of income to which the statement relates; (B) the amount of the benefits vested in the member at the expiration of the last day of that year of income; (C) the method of determining the amount of the benefits referred to in sub-subparagraph (B); (D) the amount of the portion of the benefits referred to in sub-subparagraph (B) that is required by the standards set out in these Regulations or by the trust deed to be preserved in relation to the member in the event of his or her withdrawal from the fund; (E) the amount of contributions made by the member during that year of income; (F) the amount of net earnings allotted to the member during that year of income and the rate at which those earnings were allotted; (G) the amount of any current death benefit of the member; (ii) where the amount of benefits that are vested in a member of a superannuation fund on withdrawal from the fund is calculated on the basis of the benefits purchased under an endowment or whole of life policy-the amount of: (A) the sum assured; (B) any bonuses that have accrued to the member on or before the end of the year of income to which the statement relates; and (C) contributions made by that member during that year of income; and (iii) where the amount of benefits that are vested in a member of a superannuation fund on withdrawal from the fund is defined in terms that include the member's salary at the date of his or her withdrawal from the fund, at a date prior to such withdrawal or averaged over a period of employment prior to such withdrawal-the particulars referred to in sub-subparagraphs (i) (A), (B), (C), (D), (E) and (G); (f) where a person ceases to be a member of a superannuation fund on or after 1 January 1989, on a day other than the last day of a year of income of the fund, the trustee or trustees of the fund shall give, or arrange to be given, to the person as soon as practicable thereafter a written statement setting out: (i) the amount of the benefit entitlement of the member, identifying any amounts that are required by the standards set out in these Regulations or by the trust deed to be preserved in relation to the member; (ii) the method of determining that entitlement; and (iii) if the person ceases to be a member otherwise than as a result of his or her death or retirement from the workforce-the amounts and other particulars referred to in paragraph (e), as though a reference in that paragraph to the year of income to which the statement relates were a reference to the period commencing on the first day of the year of income during which the person ceased to be such a member and ending at the expiration of the day on which the person ceased to be such a member and as though the word "person" were substituted for the word "member"; (g) where a person becomes a member of a superannuation fund, the trustee or trustees of the fund shall give to the person as soon as practicable thereafter a written statement containing details of the kinds of benefits provided to members by the fund, the conditions relating to those benefits and the method of determining entitlements of members; (h) where the trust deed of a superannuation fund is altered, the trustee or trustees of the fund shall give to each of its members as soon as practicable thereafter a written statement explaining the nature and purpose of the alteration and the effect (if any) of the alteration on the entitlements of its members; (i) the trustee or trustees of a superannuation fund shall give to a member of the fund, on request by that member, but not more than once in respect of each year of income of the fund unless the trustee or trustees agree to do so: (i) a copy of, or extract from, such of the statements referred to in paragraphs (2) (a), (b), (c) and (d) as are specified in the request, being statements contained in such actuarial reports as are so specified; (ii) a copy of such auditor's reports referred to in paragraph (c) as are specified in the request; and (iii) a copy of such returns, certificates and notices referred to in sections 12 and 13 of the Act as are specified in the request. (2) A report referred to in paragraph (1) (b) shall contain, in addition to any other matter: (a) a statement of the value of the assets of the superannuation fund; (b) a statement of the actuary's opinion on whether the value of the assets of the fund is adequate to meet the liabilities of the fund in respect of vested benefits in the fund; (c) a statement recommending, in respect of the 3-year period immediately following the period to which the report relates, the rate at which the actuary considers employer-contributions should be made or, where the actuary considers employer-contributions should be made at different rates in respect of 2 or more periods within that first-mentioned period, such different rates; and (d) a statement that employer-contributions made at the recommended rate or rates referred to in paragraph (c), together with the assets of the fund and any contributions to be made by members, will provide adequately for expected liabilities of the fund during that 3-year period. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 18 Matters required in trust deeds of superannuation funds-standard 18. For the purposes of subsection 7 (1) of the Act, the following standard is prescribed, namely, the trust deed of a superannuation fund shall, on and after 30 June 1990: (a) include the requirements contained in the standards prescribed by paragraph 6 (1) (a) and regulations 7, 8, 9, 10, 11, 13, 14, 15, 16 and 17; or (b) provide to the effect that the requirements contained in the standards prescribed by paragraph 6 (1) (a) and regulations 7, 8, 9, 10, 11, 13, 14, 15, 16 and 17, as in force from time to time, are deemed to be included in the trust deed. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 19 Approved trustee 19. For the purposes of the definition of "approved trustee" in subsection 3 (1) of the Act, the following bodies and classes of bodies are specified: (a) a life assurance company; (b) an eligible bank; (c) an eligible financial corporation; (d) a registered organisation; (e) a corporation authorised by or under a law of a State or Territory to act as an executor, administrator and trustee; (f) the Bank of New South Wales Nominees Pty Limited. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 20 Approved rules 20. For the purposes of the definition of "approved rules" in subsection 3 (1) of the Act, the following kinds of provisions are specified: (a) provisions requiring the trustee or trustees of the fund to maintain a register of depositors containing the name and current residential address of each depositor; (b) provisions requiring the trustee or trustees of the fund to keep such accounting records as correctly record and explain the transactions of the fund and the financial position of the fund and to keep those accounting records in such manner as will enable: (i) the preparation from time to time of true and fair accounts of the fund; and (ii) the accounts of the fund to be conveniently and properly audited; (c) provisions requiring the repayment to a depositor, or the legal personal representative of a depositor, of the whole of the amount deposited with the fund by the depositor, together with accumulated earnings on such amount, not later than: (i) where the depositor has died-90 days after the grant of probate or letters of administration in relation to the depositor's estate; or (ii) in any other case-the sixty-fifth anniversary of the depositor's birth; (d) provisions prohibiting the trustee or trustees of the fund from borrowing money; (e) provisions prohibiting the trustee or trustees of the fund from lending money to, or otherwise investing moneys in, a related entity other than a related entity that is an eligible bank; (f) provisions prohibiting the trustee or trustees of the fund from paying pensions or annuities to depositors; (g) provisions that do not permit a depositor, or the legal personal representative of a depositor, to receive, otherwise than in the form of a repayment of the whole or a part of an amount deposited with the fund by the depositor or accumulated earnings on such an amount, any amount from the fund; (h) provisions that do not permit a depositor to assign, transfer, mortgage or encumber the depositor's interest in an amount deposited with the fund or any accumulated earnings on such an amount; (j) provisions that require a certificate of a registered auditor to be obtained, in relation to each financial year or other accounting period of the fund, stating whether, at all times during the financial year or other accounting period: (i) the rules of the fund were approved rules; and (ii) those rules of the fund were complied with. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 21 Preservation and portability standards 21. For the purposes of subsection 8 (1) of the Act, the following standards are prescribed in relation to the preservation and portability of amounts deposited with approved deposit funds and of earnings on such amounts: (a) the trustee or trustees of an approved deposit fund shall not accept the transfer to it of any amounts of a kind referred to in regulation 9 or 10 or of any amounts consisting of benefits arising from a superannuation fund of a kind referred to in paragraph 23 (ja) of the Tax Act, as in force at the commencement of this regulation, or to which section 23FB of that Act as so in force applies, being amounts transferred to the first-mentioned fund, on behalf of a depositor, by another approved deposit fund or a superannuation fund, unless any such transferred amounts are required to be preserved in accordance with: (i) where the amounts are of a kind referred to in regulation 9 or 10-the standards set out in paragraph (b); or (ii) where the amounts comprise benefits arising from a superannuation fund of a kind referred to in paragraph 23 (ja) of the Tax Act, as in force at the commencement of this regulation, or to which section 23FB of that Act as so in force applies-either the terms and conditions referred to in paragraph 23 (ja) of that Act as so in force or terms and conditions that comply with paragraph 23FB (2) (f) of that Act as so in force, whichever are applicable; as the case requires; (b) in relation to each depositor with an approved deposit fund, amounts of the kind referred to in paragraph (a) transferred to the fund on behalf of that depositor, and earnings allotted to the depositor, in accordance with the terms of the trust deed, on the basis of such amounts, shall be preserved until: (i) those amounts are transferred in accordance with paragraph (d); (ii) the depositor has: (A) retired from the workforce; and (B) attained an age of not less than 55 years; or (iii) those amounts become payable in one of the following circumstances: (A) the retirement of the depositor from the workforce before attaining the age of 55 years on the ground of permanent incapacity or permanent invalidity; (B) the death of the depositor; (C) the permanent departure of the depositor from Australia; (D) such other circumstances (if any) as the Commissioner approves; (c) a depositor seeking payment of benefits from an approved deposit fund on his or her retirement from the workforce on the ground of permanent incapacity or permanent invalidity shall be required to give to the trustee or trustees of the fund a certificate signed by 2 registered medical practitioners certifying that, in the opinion of those medical practitioners, the depositor is unlikely ever to be able to work again in a job for which the depositor is reasonably qualified by education, training or experience; (d) all amounts required under paragraph (b) to be preserved in relation to a person shall, at the request of the person, be transferred directly to: (i) another approved deposit fund nominated by the person, being a fund that is required to preserve any amounts so transferred in accordance with the standards set out in this regulation; (ii) a superannuation fund, being a fund of which the person is, or intends to become, a member and that is required to preserve any amounts so transferred in accordance with the standards set out in these Regulations; or (iii) a deferred annuity nominated by the person, being a deferred annuity that cannot be surrendered or assigned before the person attains the age of 55 years and that does not pay benefits except in the circumstances specified in subparagraph (b) (ii) or (iii). 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 22 Disclosure of information standards 22. For the purposes of subsection 8 (1) of the Act, the following standards are prescribed in relation to the disclosure of information to depositors with approved deposit funds: (a) the trustee or trustees of an approved deposit fund shall give to each depositor with the fund, as soon as practicable after the end of the year of income of the fund commencing on 1 July 1988 and of each succeeding year of income (but, in any event, within 6 months after the end of each such year), a written statement setting out: (i) the balance in the depositor's account with the fund at the commencement of the first day of the year of income to which the statement relates; (ii) the total amount of deposits made by or on behalf of the depositor to that account during that year of income; (iii) the total amount of the earnings of the fund allotted to the depositor during that year of income; (iv) the total amount of the withdrawals made from that account during that year of income; and (v) the balance in that account at the expiration of the last day of that year of income; (b) where a person ceases to be a depositor with an approved deposit fund on or after 1 January 1989, on a day other than the last day of a year of income of the fund, the trustee or trustees of the fund shall give to the person as soon as practicable thereafter a written statement setting out: (i) the balance in that person's account with the fund at the commencement of the first day of the year of income during which the person ceases to be a depositor; (ii) the total amount of deposits made by or on behalf of the person to that account during the period commencing on the first day of that year of income and ending at the expiration of the day on which the person ceases to be a depositor; (iii) the total amount of the earnings of the fund allotted to the person during the period referred to in subparagraph (ii); (iv) the total amount of the withdrawals made from that account during the period referred to in subparagraph (ii); and (v) the balance in that account at the expiration of the day on which the person ceases to be a depositor; (c) where a person becomes for the first time a depositor with an approved deposit fund, the trustee or trustees of the fund shall give to the person as soon as practicable thereafter a written statement containing details of the operation of the fund, including the management of deposits and the conditions relating to the transfer of deposits for preservation in other approved deposit funds, superannuation funds and deferred annuities; (d) the trustee or trustees of an approved deposit fund shall give to a depositor with the fund, on request by that depositor: (i) where the request is made on or after 1 January 1989-a written statement setting out: (A) the balance in the depositor's account with the fund at the commencement of the first day of the year of income during which the request is made; (B) the total amount of deposits made by or on behalf of the depositor to that account during the period commencing on the first day of that year of income and ending at the expiration of the day before the day on which the request is made; (C) the total amount of the earnings of the fund allotted to the depositor during the period referred to in sub-subparagraph (B); (D) the total amount of the withdrawals made from that account during the period referred to in sub-subparagraph (B); and (E) the balance in that account at the expiration of the day on which the request is made; and (ii) not more than once in respect of each year of income of the fund, unless the trustee or trustees agree to do so, a copy of such returns, certificates and notices referred to in sections 14 and 15 of the Act as are specified in the request. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 23 Matters required in trust deeds of approved deposit funds-standard 23. For the purposes of subsection 8 (1) of the Act, the following standard is prescribed, namely, the trust deed of an approved deposit fund shall, on and after 30 June 1990: (a) include the requirements contained in the standards prescribed by regulations 21 and 22; or (b) provide to the effect that the requirements contained in the standards prescribed by regulations 21 and 22, as in force from time to time, are deemed to be included in the trust deed. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 24 Form of certificate by trustees and approved auditors 24. (1) For the purposes of subparagraphs 12 (1) (a) (ii) and 14 (1) (a) (ii) of the Act, a certificate by the trustees of a superannuation fund or of an approved deposit fund shall be in accordance with Form 1 in the Schedule. (2) For the purposes of subparagraph 12 (1) (a) (iii) of the Act, a certificate by an approved auditor shall be in accordance with Form 2 in the Schedule. (3) For the purposes of subparagraph 14 (1) (a) (iii) of the Act, a certificate by an approved auditor shall be in accordance with Form 3 in the Schedule. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - REG 25 Prescribed fees 25. (1) For the purposes of subsection 12 (1) of the Act, the prescribed application fee is $30. (2) For the purposes of subsection 14 (1) of the Act, the prescribed application fee is $30. 1987 No. 322 OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS - SCHEDULE SCHEDULE Regulation 24 FORM 1 CERTIFICATE BY TRUSTEES The trustee(s) of (name of superannuation fund or approved deposit fund) hereby certify that the particulars contained in this return*/the return for the year of income (insert year)* are correct and that, with the exception(s) mentioned in the return, the fund satisfied the superannuation fund conditions*/the approved deposit fund conditions* applicable to the fund in relation to the year of income specified in the return. (Signature of sole trustee or authorised trustee(s)*) Date: *Delete as appropriate FORM 2 CERTIFICATE BY APPROVED AUDITOR- SUPERANNUATION FUNDS I*/We* hereby certify that I*/we* have audited the books, accounts and other relevant records of (name of superannuation fund) for the year of income (insert year) in accordance with the Australian Auditing Standards. In my*/our* opinion, and according to the information and explanations given by the trustee(s) of the fund, and as shown in the books, accounts and other relevant records of the fund, this return*/the return by the fund for that year of income* is true and fair. (Signature of approved auditor(s)*) Date: *Delete as appropriate FORM 3 CERTIFICATE BY APPROVED AUDITOR- APPROVED DEPOSIT FUNDS I*/We* hereby certify that I*/we* have audited the books, accounts and other relevant records of (name of approved deposit fund) for the year of income (insert year) in accordance with the Australian Auditing Standards. In my*/our* opinion, and according to the information and explanations given by the trustee(s) of the fund, and as shown in the books, accounts and other relevant records of the fund, this return*/the return by the fund for that year of income* is true and fair. I*/We* further certify that at all times during that year of income: (i) the rules of the fund were approved rules; and (ii) those rules of the fund were complied with. (Signature of approved auditor(s)*) Date: *Delete as appropriate - NOTES 1987 No. 322*1* OCCUPATIONAL SUPERANNUATION STANDARDS REGULATIONS *1* Notified in the Commonwealth of Australia Gazette on 22 December 1987.