AF Access Annual Trustee Report - 2022

About the AF Access Retirement Funds

The fund is an umbrella fund. An umbrella fund is a retirement fund set up by a specialist financial services company, which a number of different employers choose to join. The objective of the fund is to assist members in saving for their retirement and to provide benefits to beneficiaries of the member in the event of the member’s death.

You are a member of the fund because your employer has decided to contribute to this fund to assist and support you in saving for your retirement.

Every year the trustees take the opportunity to update you with fund information.

Who manages your fund?

The board of trustees

The funds are both separate legal entities managed by a professional board of trustees. The board is accountable and responsible for the business of the fund. The board is committed to managing the fund honestly, fairly and with integrity. Board members act with due regard for their fiduciary duties and responsibilities, applicable laws, regulations, rules, codes of conduct, Treating Customers Fairly principles and other policies that apply to the fund.

This board of trustees decides on the benefit structures and investment portfolios that you or your employer management committee can choose from.

These are the people who are on the board of trustees:

Chairman Dr JP Fegbeutel

External trustees

(From outside Alexander Forbes)

Internal trustees

(From Alexander Forbes)

L Khangala Dr JP Fegbeutel

HR Hurd

L Munetsi

N Fakir

M Prinsloo

Specialist appointments supporting the board:

Independent principal officer

(Appointed by the trustees to manage the day-to-day affairs of the fund)

Monitoring person

(Appointed by the trustees to monitor the receipt of contributions by the fund and to report to the board on any breaches by employers)

N Zwane (appointed

1 March 2021)

W Wessels (appointed 1 April 2021)

Nazreen Fakir, who replaced Bonga Mokoena, is a senior finance business partner for Alexforbes. She has been with Alexforbes since 2015 and is a trustee on the following funds:

• Alexander Forbes Beneficiary Fund

• Alexander Forbes Trust and Let the Light Shine

Nazreen is a CA (SA) (QE2, ITC, CTA, Honors in Acc Sciences and a BCOM) and is currently doing her MBA. We believe Nazreen is a great replacement for Bonga. Her finance knowledge and expertise will ensure the funds’ finances and financials are in good hands.

Your employer management committee

Each participating employer in the fund must have an employer management committee. This management committee is responsible for making decisions regarding:

• Your employer’s benefit structure (contributions, approved risk benefits and investment portfolio selection) in the fund.

• Any matter that may be unique to your employer.

Fund governance

Ask your human resources department to find out who is on your management committee that interacts with the fund on your behalf.

Your employer management committee also has a specialist financial adviser (appointed by the employer) assisting them in managing your employer’s participation.

The fund is governed by the board of trustees and further, there are four sub-committees in place, namely:

Investment sub-committee:

The purpose of this committee is to review the investment strategy of the fund in collaboration with the fund’s asset consultant.

Communication sub-committee:

The purpose of this committee is to make sure the fund complies with all the communication requirements set out in:

• The Pension Funds Act

• The guidelines provided by the Financial Sector Conduct Authority (circulars PF86, PF90 and PF130)

• The Treating Customers Fairly (TCF) principles

The sub-committee also understands and promotes the Protection of Personal Information Act (POPIA) and the King IV Report on Corporate Governance.

These

Governance, audit, and risk sub-committee:

The purpose of this committee is to review and manage the fund’s governance, audit risk management framework and monitor the effectiveness of financial controls to safeguard the assets and integrity of the financial reporting.

Benefits sub-committee:

The purpose of this committee is to allocate death benefits and consider applications submitted by participating employers for deductions from members’ benefits and contentious divorce orders.

This committee has been given the right to make decisions and reports its activities to the board of trustees at each quarterly trustee meeting.

committees regularly review these policies:

Fund, industry and legal updates

The trustees have formulated an investment strategy that complies with the provisions of Regulation 28 of the Pension Funds Act, after considering the advice of the fund’s investment and other professional advisers.

Goals-based LifeStage enhancements (for members in the Select Access and Full Access options)

The trustees reviewed the Goals-based LifeStage strategy last year and have made some enhancements. The aim of the enhancements is to encourage you to consider the type of pension you will buy when you retire.

The new income target portfolios align with the different types of annuities purchased at retirement. The asset allocation of the portfolios also considers the cash portion you will take at retirement.

The enhancements were introduced in two phases:

Phase 1: June 2022

Enhancement of the default option aligned to a with-profit annuity. The AF Protector and AF Passive Protector portfolios were replaced by the AF Access Houseview Income Target portfolio and the AF Access Houseview Passive Income Target portfolio

Phase 2: September 2022

Two additional income target portfolios were introduced:

• AF Access Inflation Income Target portfolio

• AF Access Flexible Income Target portfolio

These options allow you to choose the most suited pre-retirement portfolio that is aligned to the type of pension you want to buy at retirement.

AF Retirement Navigator

For employers in the Base Access option the default investment portfolio is the AF Retirement Navigator, and no investment choice is offered.

Launch of Alexforbes Rewards

Alexforbes Rewards was launced in July 2022. It’s been a great success. Give the online shopping platform or USSD facility a try. There’s something for everyone and there no subscription fees.

Issued to members since launch:

9 300+ vouchers

12 000+ supermarket coupons

Nearly R3 000 000 in savings!

This is what you’ll get:

• Supermarket coupons: Shoprite, Checkers, Checkers Hyper and Pick n Pay. Save on dayto-day necessities with exclusive rand values from leading retail chains.

• Wellness coupons: Dischem. Stay healthy and save the next time you shop for health and wellness products.

• Travel deals: Randgo. Expert agents help you to find the best holiday and travel solutions.

• Airtime deals: Vodacom, Virgin Mobile, Telkom Mobile, Cell C and MTN. Access to discounts on airtime and data from South Africa’s leading providers.

Make sure we have your ID or passport number and email address or cell number so you can access Alexforbes Rewards. Please give your ID or passport number to your HR or payroll department so we can give you access.

The fund’s investments

The fund’s default investment strategy

Your retirement savings (fund credit) in the fund is invested in an investment portfolio managed by an investment manager approved by the trustees. The fund’s investment managers and the portfolios available to employers and members are selected and regularly reviewed by the trustees. The trustees use specialist asset consultants to assist them in their decision-making process.

Each participating employer has chosen their investment portfolios from the range of portfolios made available by the trustees. The details of the portfolios for your participating employer are set out in your member benefit statement and can be viewed on AF Online

In line with the requirements of the Pension Funds Act, the trustees have developed and implemented a default investment portfolio for your fund credit to be invested in if you don’t make, or are uncomfortable making, an investment choice. This default investment portfolio is the AF Goals-based Balanced LifeStage model. The design of this model is based on the latest investment research. It moves your fund credit automatically into more conservative investments as you approach your employer’s normal retirement age. If you, or your management committee, don’t make a different investment choice, your fund credit will be invested in this model.

For employers in the Base Access option, the default investment portfolio is the AF Retirement Navigator portfolio, and no investment choice is offered.

The AF Balanced High Growth portfolio

This is the growth portfolio in the trustee default strategy for the Select Access and Full Access options.

Asset allocation: 30 September 2022

The

*We use a benchmark as a value to measure how an investment portfolio is performing and if it is delivering on its performance objectives.

Management and member investment choice

The trustees noted that employers or employer management committees of employers who have selected the Select Access and Full Access options can choose one of these strategies for members:

• AF Goals-based Balanced LifeStage model

• AF Goals-based Passive LifeStage model, or

• AF Goals-based Specialist LifeStage model

Employers who have selected the Base Access option are invested in the AF Retirement Navigator Portfolio.

The AF Goals-Based Balanced Lifestage model, AF Goals-Based Passive Lifestage model and AF GoalsBased Specialist Lifestage model are based on the normal retirement date of the members of the respective participating employers.

As a member, you can opt out of the employer or management committee default strategy and invest in the other active portfolios available within your fund.

Set your own investment strategy and choose your own portfolios

If you don’t want to be invested in the default investment strategy selected by the management committee, you can choose to make your own investment choices. You can invest your savings in a wide range of specially selected portfolios or have a different investment strategy for your existing money in the fund and your ongoing contributions. You can also switch between portfolios at any stage and at no cost. All portfolios are well diversified across various asset managers and types of investments.

The range of investment portfolios available to you

AF Goals-Based Balanced LifeStage strategy portfolios Niche and balanced multimanager portfolios Balanced single-manager portfolios

AF Balanced High Growth Accelerator Allan Gray Classic Balanced

AF High Growth Banker Coronation Best Investment II

AF Passive Bold Conserver Foord Asset Management

AF Access Houseview Income TargetPerformer Ninety One SA Pty Ltd Best Investment

AF Access Passive Houseview Income Target Real Return Focus M&G Portfolio Managers

AF Access Flexible Income TargetAF Retirement Navigator

AF Access Inflation Income TargetShari’ah Medium Growth Shari’ah High Growth

Stable Focus

Stable Focus Combined

You can find the historical returns earned, as well as more details on these portfolios at www.afonline.co.za.

You can also decide to invest in more than one of these portfolios or have a different investment strategy for your existing money in the fund and your ongoing contributions. All the portfolios offered are well diversified across types of investments.

Remember that your retirement fund is a long-term investment and can be a large part of your overall wealth when you retire. It is very important that you have a personal investment strategy in place to meet your unique retirement needs and goals. The trustees encourage you to get financial advice from an accredited expert financial adviser. Good advice from an experienced professional helps you to create and follow a financial plan that sets out your realistic investment objectives and how best to achieve these objectives. Your adviser will assess your financial goals, investment time frame and tolerance for risk and monitor as these may change over time, and make appropriate recommendations for you.

Retirement benefit counselling

The trustees encourage you to get all the information you need to make the best decisions on retirement. There are a number of ways you can get retirement counselling:

• Read the Options on retiring brochure made available to members

• Your HR or salaries department will put you in touch with an accredited financial adviser

• Contact the My Money Matters Centre

My Money Matters toolkit

Are you starting a new job, leaving your employer, retiring soon, or just trying to achieve your financial goals?

Our My Money Matters toolkit provides guided decision journeys for important financial decision moments during your working life and beyond. Our aim is for every person to make informed financial choices and access the support they need to make decisions that are right for them.

If you’d like assistance with understanding your fund, check out the information on the My Money Matters website or call the My Money Matters centre: 0860 000 381

The administration of the fund

Fund statistics: pension and provident sections

Benefit payments

On average from 1 October 2021 to 30 September 2022:

• 37.28 claims were paid per day in the provident section

• 22.88 claims per day in the pension section

On average from 1 October 2020 to 30 September 2021:

• 25.77 claims were paid per day in the provident section

• 13.16 claims per day in the pension section

Financial year-end: 30 September 2022

The trustees are pleased to inform you that the audited annual financial statements for the last financial year ended on 30 September 2022 are in the process of finalisation for submission to the FSCA within the legislated deadline. The annual financial statements are set to be in good standing. You can view the fund’s annual financial statements by appointment at the fund’s registered address: Alexforbes, 115 West Street, Sandton, Johannesburg.

Deloitte is the external auditor of the fund, the company’s service is closely monitored.

The fund is valuation exempt. This means that the fund doesn’t have to appoint a valuator or submit a valuation report on the financial condition of the fund to the Registrar every three years:

• The pension section exemption is valid until 30 September 2024

• The provident section exemption is valid until 30 September 2024

Understanding vested and non-vested benefits

Vested benefit is an amount that may be taken in cash on retirement if you were a member of a provident fund or provident preservation fund on 1 March 2021.

Non-vested benefit is an amount that is not a vested benefit and is subject to the annuitisation provisions on retirement from 1 March 2021.

Below we explain what this means practically:

Were you 55 years or older on 1 March 2021?

You can take all your savings and future growth in cash when you retire – unless you transfer to a new fund before you retire.

Were you younger than 55 years on 1 March 2021?

Vested benefit

For the amount you have saved before 1 March 2021 plus the further growth, you can:

Non-Vested benefit

For the amount you have saved after 1 March 2021, you:

buy a pension

take it in cash

can take up to a third in cash

must use the rest to buy a pension

Real-time information at your fingertips

The trustees would like to make your interaction with the fund convenient and effective. To support this, we’d like to send current fund developments to you when they happen. Please make sure your employer has your latest mobile number and personal email address (not that of the company) to make sure we can stay in touch. The fund would prefer you to provide your personal email address that is not linked to your employer.

We encourage you to register for AF Online or download the Alexforbes mobile app to see your benefits and other useful information. This information is in real time and provides you with instant updates. This is what you need to register:

AF

Online

How to access

Log onto www.alexanderforbes.com

Click on Online Services and follow the prompts

Register. Wait three days to link your Alexforbes products to your online profile

Information you will find

• Investment balances

• Retirement savings statements

• Fund fact sheets

• Personal details

• Investment portfolios

• Tools to help you secure your financial wellbeing

• ‘Who needs financial support when I die?’ beneficiary nomination form

• Making short-term insurance enquiries or modifying a policy

AF mobile application

How to access Go to the Apple app store or the Google Play store on your phone

Search Alexforbes and download for free

Information you will find

• Investment balances

• Retirement savings statements

• Fund fact sheets

• Personal details

• Investment portfolios

• Media section and products section

• FAQs

• Talk to us

• Short-term insurance policy details

Your fund’s service providers

Service Provider Function

Sponsor

Independent Financial Adviser (IFA)

Your employer’s choice

The sponsor sets up the fund to provide retirement and other benefits to the fund’s members

The administrators handle all the day-to-day administrative duties of the fund. They make sure the contributions are received by the fund are invested, benefits are paid out, new members are registered, and so on

You can contact the fund’s administrator if you have any questions about your benefits on 0860 60 61 62 or info@alexforbes.co.za

An accredited financial adviser provides advice to your management committee on which benefits and investments to put in place for your particular employer’s group of members.

Note: the AF consultant is still classified as an IFA

A multi-manager chooses investment managers who invest your fund benefit according to your chosen investment strategy

The actuaries make sure that the fund is in a sound financial position. Together with the consultants, they provide expert advice to the trustees on the management of and the benefits provided by the fund

Auditors

The auditors examine the fund’s financial statements once a year to make sure the fund’s financial situation is sound and that the information reported in the financial statements is correct

This insurance covers the fund and trustees for losses caused by theft or fraud and professional negligence of fund trustees and the principal officer

The information officer is appointed by the trustees to fulfill the duties set out in the Protection of Personal Information Act (POPIA)

Alexander Forbes Financial Services (Pty) Ltd

Administrator

Alexander Forbes Financial Services (Pty) Ltd

Investment Managers

Alexander Forbes Investments

Actuaries & Consultants

Alexander Forbes Financial Services (Pty) Ltd

Deloitte

Retirement benefit fund and trustee liability insurance

Camargue Underwriting Managers (Pty) Ltd

Information officer

Ms N Burrows

Death benefits

If you pass away while you are a member of the fund, it is the duty of the trustees, in terms of Section 37C of the Pension Funds Act, to distribute your death benefit to your beneficiaries, preferably within 12 months of your passing. This benefit does not form part of your estate and can therefore not be distributed according to your will or testament.

The trustees have to conduct a thorough investigation and identify all your dependants and nominated beneficiaries, to accurately assess their level of dependency on you. The results of this investigation are very important for the allocation of the death benefit. The trustees have full discretion of allocating these benefits, which may be proportional.

Remember:

Your nominations must add up to 100%.

Allocate 0% to those you don’t want to receive any part of your death benefit. It would be helpful to the trustees if you included a reason for your decision.

When allocating the death benefit, the trustees consider the information provided by you in your nomination of beneficiaries form. Please remember that the nomination form is a guide only and the trustees may not follow this exclusively in allocating benefits. It is extremely important to update your nomination of beneficiaries form when your life circumstances change, for example, when you get married, divorced, one of your dependants dies, or after the birth of a child. Once you have updated your form, please hand it to your human resources or payroll department for safekeeping. This is the only way for the trustees to know your last wishes and avoids long and unnecessary delays in the process when your family needs this money most.

Please inform your dependants and nominated beneficiaries of this process. More detail is set out in the fund’s guide to death benefits.

Revised general rules

You can view the fund’s general rules by appointment at the fund’s registered address: Alexforbes, 115 West Street, Sandton, Johannesburg.

Your employer-specific benefits in the fund are set out in your employer’s special rules. These special rules apply only to your employer’s members in the fund. You receive a separate newsletter if these special rules are amended. You can view your sub-fund’s special rules at your employer.

Fund contact details

If you have any questions, comments or suggestions about the fund, your benefits, investments or any other fundrelated issues, please contact one of your management committee members or phone the AF Access Retirement Fund Call Centre on 0860 60 61 62.

Fund name and Financial Services Board registration number

• AF Access Retirement Fund: Pension Section (12/8/37997)

• AF Access Retirement Fund: Provident Section (12/8/37998)

Procedure for complaints

Registered address

Alexforbes, 115 West Street, Sandton, Johannesburg

The trustees of the fund aim to ensure that members have confidence in the fund and are satisfied with the standard of service provided by its service providers. If, however, you do have a complaint, this can be lodged at the following offices.

Alexander Forbes Contact Centre

Tel: 0860 60 61 62

Email: complaintsoffice@alexforbes.co.za

Pension Funds Adjudicator

Tel: 086 066 2837 or 012 748 4000

Fax: 086 693 7472

Email: enquiries@pfa.org.za www.pfa.org.za

FAIS Ombud

Tel: 012 470 9080

Fax: 012 348 3447

Email: info@faisombud.co.za www.faisombud.co.za

Information officer

Ms N Burrows burrowsn@alexforbes.com

Information Regulator

Email: complaints.IR@justice.gov.za www.justice.gov.za/inforeg

• Lodge an official complaint in writing to the fund.

• All complaints should be lodged here so that they can be investigated and dealt with promptly.

• Lodge a complaint with the Pension Funds Adjudicator if your complaint about the fund or the trustees was not resolved to your satisfaction through the Contact Centre.

• Lodge a complaint with the FAIS Ombud, if your complaint about the quality or appropriateness of the financial advice you received from your financial adviser.

• Lodge a complaint in writing to the fund’s information officer if you are dissatisfied with the manner in which your personal information has been processed or if your privacy rights have been compromised or breached.

• Lodge a complaint with the Information Regulator if you remain dissatisfied with the fund’s information officer’s response to your complaint.

If there are any conflicts between the information in this trustees’ annual report and the official rules of the fund, the rules of the fund will always apply.