mercer super investment trust · mercer super investment trust product disclosure statement 21...

MERCER SUPER INVESTMENT TRUST PRODUCT DISCLOSURE STATEMENT 21 AUGUST 2014

Issued by Mercer Investments (Australia) Limited (MIAL), ABN 66 008 612 397, Australian Financial Services Licence #244385, as the Trustee of the Mercer Super Investment Trust: GPO Box 9946, Melbourne VIC 3001. Telephone 03 9623 5555. MIAL is a wholly owned subsidiary of Mercer (Australia) Pty Ltd (Mercer) ABN 32 005 315 917. “MERCER” is a registered trademark of Mercer (Australia) Pty Ltd.

2 Product Disclosure Statement 21 AUGUST 2014

Contents

About this Product Disclosure Statement ........................................................................................ 3

Key terms explained ......................................................................................................................... 4

Overview of the Mercer Super Investment Trust ............................................................................. 5

Key information ................................................................................................................................ 6

Benefits of investing in the Trust ...................................................................................................... 7

About Mercer Investments ........................................................................................................................ 7

Benefits of investing with us ...................................................................................................................... 7

How we invest ........................................................................................................................................... 8

Investment performance ......................................................................................................................... 12

Key risks ........................................................................................................................................ 13

Investment Options in detail ........................................................................................................... 16

Single Sector Options ....................................................................................................................... 16-23

Diversified Options .......................................................................................................................... 24-27

Fees and other costs ...................................................................................................................... 28

Taxation .......................................................................................................................................... 36

Other things you should know ........................................................................................................ 38

How to invest in the Mercer Super Investment Trust .................................................................... 43

After you have joined ..................................................................................................................... 46

Application form ................................................................................................................................ i

MERCER SUPER INVESTMENT TRUST

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About this Product Disclosure Statement (PDS) The Mercer Super Investment Trust is a ‘Pooled Superannuation Trust’ as defined under the Superannuation Industry (Supervision) Act 1993 (SIS). Mercer Investments (Australia) Limited (MIAL) is the Trustee of the Mercer Super Investment Trust, (ABN 66 008 612 397, AFSL 244385, RSE L0003421). MIAL is the issuer of this PDS and a wholly owned subsidiary of Mercer (Australia) Pty Ltd (ABN 32 005 315 917). Mercer (Australia) Pty Ltd is a wholly owned subsidiary of Marsh & McLennan Companies (NYSE: MMC) a global team of professional services companies offering advice and solutions in the areas of risk, strategy and human capital. The Mercer Super Investment Trust is referred to as the ‘Trust’ throughout this PDS. MIAL is referred to as ‘Trustee’, ‘we’ or ‘us’ throughout this PDS. This PDS provides an outline of the main features and benefits of the Trust. It should be read carefully before you make any investment decision. The information contained in this PDS is general information only and does not take into account your individual financial objectives, financial situation or needs. We recommend that you speak to a licensed, or appropriately authorised, financial adviser if you need help making an investment decision. For an explanation of the terms used in this PDS refer to the Key terms explained section on page 4. The value of investments in the Investment Options may rise and fall from time to time. None of the Trustee, Mercer, any other Marsh & McLennan Company, nor any of the other investment managers guarantee the investment performance, earnings, payment of income distributions or return of capital invested in any of the investment options made available through this PDS (Investment Options).

If you received a copy of this PDS electronically, you need to print all of it. If you would like a paper copy, please contact us and we will send you one free of charge. The invitation to invest made in this PDS is only available to persons receiving the PDS in Australia and the Trustee is not bound to accept an application to invest.

Staying up to date

Some of the information contained in this PDS may change from time to time. Where the updated information is not materially adverse information, investors can obtain a copy at any time by calling 1800 512 947 or by visiting www.mercer.com.au/invest. We can also send you a copy of the updated information on request free of charge. Investors will be advised of material changes and significant events as required by law. See Material changes and significant events on page 40 of this PDS. The Trust has a process in place for dealing with enquiries and complaints. For more information see Enquiries and complaints on page 41 of this PDS.

The Trustee’s contact details

Mercer Investments (Australia) Limited GPO Box 9946, Melbourne VIC 3001 Telephone: (03) 9623 5555 Website: www.mercer.com.au/invest


Key terms explained To help you understand the information in this PDS and the differences between the Investment Options, here we explain some of the terms used and how they are relevant to the different Investment Options.

Growth and defensive investments

Growth investments are those that have the potential to grow over the long-term but are also likely to experience volatility (ups and downs) in performance from time to time. Defensive investments tend to produce lower but more stable long-term returns than growth investments. We have applied the Mercer Growth Defensive Enhanced (GDE) process to the Mercer Diversified Investment Options to split the asset allocation between ‘growth’ and ‘defensive’ asset classes. The Mercer GDE process is described on page 11 of this PDS. The Growth/ Defensive split for each Investment Option is shown in the Investment Options in detail section, starting on page 16 of this PDS. Example:

For the asset allocation shown above, the benchmark for this investment option is 70% growth investments and 30% defensive investments. The Trustee can alter these benchmarks within the bracketed range of 60% - 80% for growth assets and 20% - 40% for defensive assets.

Hedging Hedging generally refers to the process of protecting investments against, or reducing the risk of, a loss. For example, investment managers may use various techniques to minimise the effect of currency movements on overseas investments – this is currency hedging.

Minimum investment timeframe This is the minimum time an investor should generally consider holding an investment in an Investment Option in order to meet the Investment Option’s objectives. This is a guide only.

Standard risk measure

The Standard Risk Measure is a standardised investment industry guide to assist investors to compare investment options that are expected to deliver a similar number of negative annual returns over any 20 year period. The standard risk measure is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be or the potential for a positive return to be less than an investor may require to meet their objectives. Further, it does not take into account the impact of administration fees and tax on the likelihood of a negative return. Investors should still ensure they are comfortable with the risks and potential losses associated with their chosen Investment Option/s. The standard risk measure consists of seven risk labels, shown in the following table.

Risk label Estimated number of

negative returns over any

20 year period

Very high 6 or more

High Between 4 and 6

Medium to high Between 3 and 4

Medium Between 2 and 3

Low to medium Between 1 and 2

Low Between 0.5 and 1

Very low Less than 0.5 The risk labels are indicative only. The risk label for each Investment Option is determined by us on the basis of financial market forecasts and should not be considered to be a guarantee or forecast of the number or frequency of negative annual returns an Investment Option may experience.


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Overview of the Mercer Super Investment Trust The Trust provides investors with the flexibility to tailor a portfolio to suit their investment objectives and risk profile. Investors can choose to invest in one or more of the following Investment Options:

Single sector options, these enable investors to build a unique portfolio from single asset class ‘building blocks’. The options provide access to the asset classes relevant to local investors.

Diversified options, these provide ‘pre-mixed’ portfolios of different asset classes designed to achieve a range of investment objectives.

‘Plus’ options are also available within the range of Single sector and Diversified options, which aim to achieve higher returns than their corresponding core options, though consequently carry a higher level of investment risk.

In relation to the Plus options, investors should note that there is no guarantee that the expectations of higher risk and return characteristics will be met over any particular period. These expectations are based on the fact that the Plus options may have different allocations to investment managers within asset classes (for example, a higher exposure to more aggressive strategies), different benchmark weightings (for example, a greater exposure to alternative assets, where relevant) and/or wider asset allocation ranges. A list of Investment Options currently available within this PDS is shown in the table on the right. Further details can be found in the Investment Options in detail section, starting on page 16 of this PDS. It is up to you to determine whether the investment objectives and strategy of a particular Investment Option are consistent with your investment objectives and strategy. We strongly recommend that you speak to a licensed, or appropriately authorised, financial adviser before making an investment decision.

The Trustee may vary the Investment Options available to investors from time to time. This information will be provided to investors in accordance with the Staying up to date section, starting on page 3 of this PDS.

Investment Options Page

Single Sector

Shares

Mercer Australian Shares 16

Mercer Australian Shares Plus 16

Mercer Australian Small Companies 17

Mercer International Shares 17

Mercer Hedged International Shares 18

Mercer International Shares Plus 18

Mercer Hedged International Shares Plus 19

Mercer Global Small Companies Shares 19

Mercer Emerging Markets Shares 20

Property and Infrastructure

Mercer Global Listed Property 20

Mercer Australian Direct Property 20

Mercer Global Listed Infrastructure 21

Mercer Global Unlisted Infrastructure 21

Alternatives

Mercer Diversified Alternatives 21

Fixed Interest

Mercer Australian Sovereign Bond 22

Mercer Global Sovereign Bond 22

Mercer Australian Inflation Plus 22

Mercer Global Credit 23

Cash

Mercer Cash 23

Diversified

Mercer Diversified Shares 24

Mercer High Growth 24

Mercer Growth Plus 25

Mercer Growth 25

Mercer Moderate Growth 26

Mercer Conservative Growth 26

Mercer Defensive 27


Key information Investment minimums

Minimum initial investment* $500,000

Minimum additional investment* $20,000

* We may waive or vary the investment minimums at our discretion.

Fees

See the Fees and other costs section, which starts on page 28.

Transacting

Initial application You need to read the current PDS and complete the relevant sections of the attached Application Form. The Application Form needs to be sent to the Trustee. You can invest by cheque or electronic transfer.

Additional investments Additional investments can be made by cheque or electronic transfer and by providing us with a written request with your instructions for the allocation of your investment.

Withdrawing You need to provide us with a written request with your instructions. Withdrawals will be credited to your nominated bank account. For further details see Requesting a withdrawal payment on page 47 of this PDS.

Switching Switching between Investment Options is permitted at any time with the approval of the Trustee. You need to provide us with a written request with your instructions. For further details see Switching between investment options on page 47 of this PDS.

Distributions The Trust will not make distributions of investment income as long as it remains a pooled superannuation trust. See Distribution of income on page 38 of this PDS.

Reporting

Annual An annual report.

An annual transaction advice.

Quarterly A quarterly investment report.

Monthly A monthly advice confirming the value of your investments.

A monthly investment report.

Confirmation A transaction advice will be sent to you each time you transact.

Other information

Cooling Off Period If you invest in the Trust and decide that the investment is not suitable, you may request in writing to cancel your investment during the 14 day cooling off period in certain circumstances. For further details on your cooling off rights, see Cooling Off on page 40 of this PDS.

Contact Information You can call us on 1800 512 947 to:

Obtain details of your unit holdings.

Receive the latest unit prices.

Change contact details.

Make general inquiries.

Obtain further copies of the PDS.

Or you can visit www.mercer.com.au/invest.


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Benefits of investing in the Trust

About Mercer Investments After more than 40 years in the business, Mercer globally now advises clients who collectively have over $6.9 trillion in assets. That makes us the largest1 investment advisor in the world by institutional advisory assets. Our scale allows us to offer a comprehensive menu of investment tools, advice and solutions to help you navigate complex investment markets. Our portfolio management teams manage $100 billion worldwide, with more than $23 billion invested on behalf of clients in Australia and New Zealand. In designing and managing our Investment Options, we draw on an extensive network of 1,300 consulting specialists and our in-house teams of research professionals who cover investment managers, capital markets and strategic opportunities.

Benefits of investing with us We have five beliefs that underpin our approach and drive investment success.

Diversification

Diversification is spreading investments across a range of investment types and across different risks. It involves thinking strategically about how investments are allocated. Diversification can smooth out periods of market volatility and helps protect your investments from loss. Our approach to diversification includes using sophisticated models and tools to develop a greater understanding of the risk drivers within each asset, and establishing the rigorous risk controls required for long-term investment success.

1 As at 30 June 2013 – Source: Pensions and

Investments Magazine

Depending on how you diversify, underperformance in one area may be offset by outperformance in another and, as a result, investment risk can be reduced.

Active management

Diversification determines which assets to invest in, but finding the best market opportunities is only possible with the best investment managers. Mercer uncovers investment managers who can exploit opportunities created by market mispricings of individual assets that others overlook or are simply ill-equipped to find. Our dedicated team of 119 investment manager researchers worldwide are constantly researching and assessing managers for those who possess the determination, capability and skilful judgement to actively draw out opportunities in a particular type of asset and produce superior returns.

Dynamic asset allocation

Due to the behaviour of investment market participants at any given point in time, the price of an asset may deviate significantly from its underlying value. This is why we believe investors must be flexible to reduce positions in overvalued assets and increase exposures to those offering potential growth opportunities.

Operational efficiency

Operational efficiency is about getting the most value out of every dollar invested by minimising unnecessary costs and avoiding unrewarded risks. We do this through using tools and expert techniques in transition management, securities lending, foreign currency transactions, custody reviews and operational risk assessments. Our scale enables us to negotiate competitive fee arrangements with specialist managers and other service providers, such as custodians.

Sustainable growth

We take a long view on managing your investments and help our clients prepare for the future by understanding the full range of potential risks arising from social or environmental issues, potential policy changes or failures in governance and how these can be mitigated or even exploited. We regularly partner with highly regarded industry bodies and multi-lateral organisations to challenge current thinking and to look beyond the next five to ten years, to anticipate and drive beneficial change for investors.


How we invest Investment objectives and strategy

All Investment Options are created with a specific performance objective, which we aim to achieve consistently over time. For each Investment Option, we have determined an investment strategy that we believe is reasonably likely to enable the Investment Option to meet its objectives. However, there is no guarantee that a particular objective will be met over a particular period. The strategy includes the selection of a mix of long-term investments (asset classes) that supports the Investment Option’s objectives, as detailed in the section of this PDS titled Investment Options in detail section, starting on page 16. Changes may be made to the investment objective/s and strategy for each Investment Option, as required, in order to ensure that the objective/s continue to have a reasonable probability of being attained. The actual asset allocations may fall outside the stated ranges during certain times such as extreme market conditions, asset class transitions or during material transactions. You will be kept informed of any significant changes to the features of the Investment Option/s in which you are invested. See Material changes or significant events on page 40 of this PDS.

How the Trust’s assets are invested

The assets of the Trust are invested in a range of trusts and other investment vehicles, including:

Other funds managed by the Trustee or related entities. See Underlying funds below.

Other funds managed by professional investment managers.

Directly in a range of investments such as securities, derivatives and cash managed via mandates held with professional investment managers.

A summary of the Investment Options’ exposure to the underlying funds, funds managed by other investment managers and direct investments is set out on the following page.

Underlying funds

The Trust generally gains its asset class exposure by investing in a number of the Mercer Multi-Manager Funds and/or Mercer Investment Funds, of which the Trustee is the responsible entity or trustee. The Trust may also invest in other Mercer funds or directly with third party investment managers. To obtain further information in relation to any of the underlying funds, or a copy of a PDS (where applicable), please call 1800 512 947 or visit www.mercer.com.au/invest. Also see Disclosure of interests and related party transactions on page 42 of this PDS for further information about investment in other Mercer products.


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Mercer Superannuation Investment Trust – Investment Options

Underlying investments

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Mercer Multi-Manager Funds

Mercer Passive Australian Shares Fund

Mercer Australian Small Companies Fund

Mercer Passive International Shares Fund

Mercer Emerging Markets Shares Fund

Mercer Global Listed Property Fund

Mercer Passive Global Listed Property Fund

Mercer Global Listed Infrastructure Fund

Mercer Passive Global Listed Infrastructure Fund

Mercer Diversified Alternatives Fund 2

Mercer Australian Sovereign Bond Fund

Mercer Global Sovereign Bond Fund

Mercer Australian Inflation Plus Fund

Mercer Global Credit Fund

Mercer Emerging Markets Debt Fund

Mercer Global High Yield Bond Fund

2 From 1 October 2013, the majority of the Mercer Diversified Alternatives Fund's investments will be held in the Mercer Liquid Alternatives Strategies Fund (‘MLAS’). MLAS is a Dublin-domiciled Mercer

fund managed by a related party.



Mercer Superannuation Investment Trust – Investment Options

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Mercer Global Absolute Return Bond Fund

Mercer Cash Fund – Cash Units

Mercer Investment Funds

Australian Shares (Plus)

Australian Shares (Core)

Active Overseas Shares

Hedged Overseas Shares

Enhanced Passive Overseas Shares

Global Small Caps

Direct Property

Global Unlisted Infrastructure

Natural Resources

Directly held investments

Lend Lease Core Plus

AMP Core Prop SF3

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Manager research and selection

Mercer’s significant scale in researching managers globally provides us with access to the best ideas from more than 5,400 investment managers around the world. The Australian-based multi-manager team leverages the global Mercer research network to establish optimal combinations of specialist managers for each asset class. Mercer’s investment manager research focuses on each manager’s strength in idea generation, portfolio construction, implementation and business management. We may remove, replace, or appoint additional investment managers for the Investment Options at our discretion at any time. Current investment manager details can be obtained by contacting us on 1800 512 947 or via www.mercer.com.au/invest.

Growth Defensive Enhanced (GDE) Process

To better measure the 'true' risk in an Investment Option and to assist in balancing risks within the Investment Options, we have adopted the Mercer Growth Defensive Enhanced (GDE) process for all Diversified options. The GDE process involves a two-dimensional breakdown of each asset sector into its growth and defensive component. The growth/defensive split is determined for each asset class using the GDE process and aggregated to the Investment Option level. A range of measures are used to assess where an asset class sits on the growth defensive spectrum.

Sustainable investing and ESG considerations

At Mercer, we build ‘sustainable growth’ principles into our investment portfolios to help protect and enhance the value of our clients’ investments. We look beyond traditional financial factors to consider the potential investment impacts of corporate governance as well as environmental and social issues – such as an aging population, energy and resource constraints and climate change. We believe environmental, social and governance (ESG) factors may have a material impact on long term risk and return outcomes. We also believe that principles of active ownership and investment stewardship are of value in the investment process. For that reason, ESG considerations, principles of active ownership and investment stewardship are incorporated throughout Mercer’s investment decision making and ownership practices, as documented in

our Mercer Funds Sustainable Investment Policy and Mercer Funds Corporate Governance Policy. Each policy is described briefly below.

Mercer Funds Sustainable Investment Policy

Under this policy, Mercer will:

Inform investment managers and other relevant service providers about our expectations in relation to ESG factors and investment stewardship.

Regularly monitor the progress of the parties engaged in investment management to improve alignment between expectations and requirements in regard to integrating ESG and active ownership.

Promote our expectations in respect of ESG and active ownership as a formal part of the investment manager selection and review process.

Monitor ESG risks and opportunities – such as the environmental implications of climate change, the social impacts of health and safety and the corporate governance implications of appropriate executive remuneration structures.

Apply principles of active ownership and investment stewardship, including voting and engagement.

Mercer Funds Corporate Governance Policy

Mercer actively exercises its duties and obligations as an owner and steward of the assets in which it invests. The Mercer Funds Corporate Governance Policy encompasses:

Share voting – An effective way for Mercer to demonstrate active ownership is by voting its shares at all shareholder meetings and holding companies accountable for their performance, both financially and on ESG issues.

Corporate engagement – Our investment managers have discussions with senior management and board members about corporate strategy and operating practices and encourage them to operate sustainably and responsibly.

Public policy participation – Mercer and the Trust’s appointed investment managers engage with regulators and governments to encourage strong policies that promote good governance and sustainability as a foundation for sustainable economic growth.

Disclosure – In the interests of transparency for investors, Mercer will publish on its website its voting policy and its voting record on a six monthly basis, within three calendar months of the end of the six month period.

12 Product Disclosure Statement 21 August 2014

Derivatives

Please see Use of derivatives on page 14 of this PDS.

Changes to the Trust

Note that the Trustee may add new Investment Options, close existing Investment Options or alter the terms of any Investment Option from time to time. You will be kept informed of any significant changes to the features of the Investment Option/s in which you are invested. See Material changes or significant events on page 40 of this PDS.

Investment Performance

How to get up to date returns

You can obtain updated performance information for each Investment Option by calling 1800 512 947 or via www.mercer.com.au/invest. We can send you a copy of updated performance information, free of charge, on request. Investment performance is also reported in the monthly and quarterly investment reports.

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Key risks Significant risks associated with the Mercer Super Investment Trust

Before making any investment decisions, you should carefully consider the risks that apply to each of the Investment Options available through this PDS. This is important as your investment in any of the Investment Options is not guaranteed and as such you may get back less money than you invest. Investment returns can be volatile and the value of investments may increase or decrease over time. Also you should not rely on past performance as an indicator of the future performance of any of the Investments Options or treat their respective investment objectives as a forecast or guarantee of future returns. We strongly recommend that you speak to a licensed or appropriately authorised financial adviser before making any investment decisions. In addition you should be aware that taxation laws affecting investment in the Investment Options are complex and are often changed with little notice. As individual circumstances differ, taxation laws will affect individual investors in different ways. Accordingly the Trustee recommends that you also seek your own professional advice on taxation matters. Generally, investment risk is the chance that an investment outcome will be different to what is expected. Investments in the Trust could rise or fall in value or produce a return which is less than anticipated. Rises and falls in value occur for a variety of reasons and can sometimes occur quickly. The types of investment risks which may have an impact on an investment in the Trust are summarised in the table below.

Risk Description

Individual asset risk

The risk attributable to individual assets within a particular asset class.

Market risk The risk of major movements within a particular asset class. In addition, the investment performance of the Investment Option may be affected by the investment performance of the underlying funds in which the Investment Option invests. Through its investment in the underlying funds, the Investment Option is subject to the risks of the underlying funds’ investments. These risks are captured under the other risks detailed in this section.

Political risk The risk that domestic and international political events can impact on investment.

Inflation risk The risk that money may not maintain its purchasing power due to increases in the price of goods and services (inflation).

Derivatives risk The risk that exposure to exchange-traded and over the counter derivative instruments increases the risk in a portfolio or exposes a portfolio to additional risks - such as the possibility a position is difficult or costly to reverse or that there is an adverse movement in the asset, interest rate, exchange rate or index underlying the derivative.

Timing risk The risk that, at the date of investment, money is invested at higher market prices than those available soon thereafter. Alternatively, it can also mean the risk that, at the date of withdrawal, investments are redeemed at lower market prices than those that were recently available or that may have been available soon thereafter.

Investment manager risk

The risk that a particular investment manager will underperform (this could be for example because their view on markets is wrong or because of their investment “style” or because they lose key investment personnel).

Credit risk The risk that a debt issuer will default on payment of interest or principal.

Liquidity risk The risk that investors will be unable to redeem their investment at their chosen time.

Currency risk The risk that overseas investments gain or lose value as a result of a falling or rising Australian dollar.

Taxation risk The risk that taxation laws and their interpretation may change in the future in a manner that may adversely impact the taxation outcomes for either the Trust or investors into the Trust.

See the Investment risk table later in this section for details as to which of the above risks apply to each of the Investment Options available through this PDS. We have also provided the Standard Risk Measure for each Investment Option in the section of this PDS titled Investment Options in detail, which starts on page 16


Risk management

The Investment Options have been established by the Trustee based on its multi-manager investment approach. The Trustee has considered the above investment risks in constructing these options and aims to help manage those risks primarily through diversification and by using some or all of the following (as applicable):

Investing across different asset classes (to reduce market risk, inflation risk and liquidity risk).

Investing with a number of different investment managers (to reduce investment manager risk).

Investing across different countries (to reduce political risk, inflation risk, liquidity risk and currency risk).

Investing in a number of individual assets within each asset class (to reduce individual asset risk, liquidity risk and credit risk).

Timing risk is reduced to an extent by diversification, but is more effectively managed by selecting one or more Investment Options that best suit the investor’s particular investment time horizon (that is, the time period you expect to hold your investment in the Investment Option/s). In addition the investment managers appointed by the Trustee to manage the underlying assets in each of the Investment Options may use derivatives to help manage risk (for example, to hedge all or part of a foreign currency exposure). See the Key terms explained section of this PDS on page 4 for an explanation of hedging.

Use of derivatives

Derivatives, such as futures or options, are investment securities whose value is derived from other investments. For example, the value of a share option is linked to the value of the underlying share. Investment managers may utilise derivatives in managing investment portfolios for the Trustee and in managing pooled investment vehicles in which the Trustee invests. Derivatives may be used to assist in the efficient management of the portfolio (e.g. to quickly and effectively adjust asset class exposures and for rebalancing purposes) and to manage risk (e.g. for currency hedging). Losses from derivatives can occur (e.g. due to market movements). The Trustee seeks to manage risk by placing limits on the extent of derivative use in any relevant Investment Management Agreement between the Trustee and investment managers. The Trustee also considers the risks and controls set out by the investment managers it appoints. The Trustee has also adopted its own Derivatives Policy in which the relationship between the Trusts’ overall investment strategy and the usage of derivatives is outlined.

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Investment risks table

The table below shows whether there is a low, medium or high likelihood (shown as ‘L’, ‘M’ or ‘H’) that a type of investment risk (referred to earlier in this section) may apply, from time to time, to a particular Investment Option. The Standard Risk Measure for each Investment Option is also provided in the section of this PDS titled Investment Options in detail on pages 16 to 27. The risk information in the table below is indicative only and the likelihood that a type of investment risk may apply to a particular Investment Option may change over time. However, you will be kept informed of any significant changes to the features of the Investment Option/s in which you are invested. See Material changes or significant events on page 40.

Mercer Super Investment Trust Investment Options

Indi

vidu

al a

sset

ris

k

Mar

ket r

isk

Po

litic

al r

isk

Infla

tion

risk

De

riva

tive

s ris

k

Tim

ing

risk

Inve

stm

ent m

anag

er r

isk

Cre

dit r

isk

Liqu

idity

ris

k

Cur

renc

y ris

k

Tax

atio

n ris

k

Single Sector

Shares

Mercer Australian Shares L H L L L H L L L L L

Mercer Australian Shares Plus L H L L L H L L L L L

Mercer Australian Small Companies L H L L L H L L M L L

Mercer International Shares L H M L L H L L L H L

Mercer Hedged International Shares L H M L L H L L L L L

Mercer International Shares Plus L H M L L H L L L H L

Mercer Hedged International Shares Plus L H M L L H L L L L L

Mercer Global Small Companies Shares L H M L L H M L L H L

Mercer Emerging Markets Shares L H H L L H M L L H L

Property and Infrastructure

Mercer Global Listed Property L H M L L H M L L L L

Mercer Australian Direct Property M H L L L H M L H L L

Mercer Global Listed Infrastructure L H M L L L H L L L L

Mercer Global Unlisted Infrastructure M H M L L H M L H L L

Alternatives

Mercer Diversified Alternatives L H M L M M M M M M L

Fixed Interest

Mercer Australian Sovereign Bond L L L H L L M L L L L

Mercer Global Sovereign Bond L L L H L L M L L L L

Mercer Australian Inflation Plus L L L L L M M L L L L

Mercer Global Credit L M M M L M M M H L L

Cash

Mercer Cash L L L H L L L L L L L

Diversified

Mercer Diversified Shares L H L L L H L L L H L

Mercer High Growth L H L L L H L L L M L

Mercer Growth Plus L M L L L M L L L M L

Mercer Growth L M L L L M L L L M L

Mercer Moderate Growth L M L L L M L L L L L

Mercer Conservative Growth L L L M L L L L L L L

Mercer Defensive L L L M L L L L L L L


The Investment Options in detail

SINGLE SECTOR OPTIONS

Mercer Australian Shares

Investment Strategy This Investment Option invests in Australian shares using a multi-manager approach.

Benchmark

S&P/ASX 300 Accumulation Index

Objectives

To achieve a return over the medium to longer term that is competitive with comparable investment options that have similar risk characteristics.

To outperform the notional return of a benchmark portfolio of suitable market indices over one year or greater.

Standard Risk Measure

High

Minimum Investment Timeframe At least seven years

Asset Allocation

Asset Classes Target %

Range %

Australian Shares 100 90-100

Cash 0 0-10

Mercer Australian Shares Plus

Investment Strategy This Investment Option invests in Australian shares using a multi-manager approach by using investment managers who may take advantage of innovative and higher-return seeking investment strategies.

Benchmark S&P/ASX 300 Accumulation Index

Objectives



Minimum Investment Timeframe

At least seven years

Asset Allocation

Asset Classes Target

% Range

% Australian Shares 100 90-100

Cash 0 0-10


High

21 AUGUST 2014 17


Mercer Australian Small Companies

Investment Strategy This Investment Option invests in Australian small company shares using a multi-manager approach.

Benchmark

S&P/ASX Small Ordinaries Accumulation Index

Objectives



Standard Risk Measure High


Asset Allocation


% Range

% Australian Small Cap Shares 100 90-100

Cash 0 0-10

Mercer International3 Shares

Investment Strategy This Investment Option invests in international shares using a multi-manager approach.

Benchmark

MSCI World Index (ex Australia)

Objectives


To outperform the notional return of a benchmark portfolio of suitable market indices over periods of one year or greater.



Asset Allocation


% Range

% International Shares 100 90-100

Cash 0 0-10

3 Previously known as Mercer Overseas Shares


Mercer Hedged International Shares4

Investment Strategy This Investment Option invests in international shares using a multi-manager approach. Returns are hedged back into Australian dollars.

Benchmark MSCI World Index (ex Australia)

Objectives





Asset Allocation


% Range


Cash 0 0-10

Mercer International5 Shares Plus

Investment Strategy This Investment Option invests in international shares using a multi-manager approach by using investment managers who may take advantage of innovative and higher-return seeking investment strategies.

Benchmark


Objectives





Asset Allocation


% Range


Cash 0 0-10

4 Previously known as Mercer Hedged Overseas Shares 5 Previously known as Mercer Overseas Shares Plus

21 AUGUST 2014 19


Mercer Hedged International Shares Plus6

Investment Strategy This Investment Option invests in international shares using a multi-manager approach by using investment managers who may take advantage of innovative and higher return seeking investment strategies. Returns are hedged back into Australian dollars.

Benchmark


Objectives





Asset Allocation


% Range


Cash 0 0-10

Mercer Global Small Companies Shares7

Investment Strategy This Investment Option invests in international small companies shares using a multi-manager approach.

Benchmark

MSCI World Small Cap Index

Objective

To outperform the notional return of a benchmark

portfolio of suitable market indices over periods of one

year or greater.



Asset Allocation


% Range

%

International Small Cap Shares

100 80-100

Cash 0 0-20

6 Previously known as Mercer Hedged Overseas Shares Plus 7 Previously known as Mercer Overseas Small Companies


Mercer Emerging Markets Shares8

Investment Strategy This Investment Option invests in emerging markets shares using a multi-manager approach.

Benchmark

MSCI Emerging Markets Index

Objective



year or greater.



Asset Allocation


% Range

% Emerging Markets Shares 100 80-100

Cash 0 0-20

Mercer Global Listed Property9 Investment Strategy

This Investment Option invests in global listed property

securities using a multi-manager approach.

Benchmark

FTSE EPRA/NAREIT Developed Index - in A$

(Hedged)

Objective



year or greater.



Asset Allocation


% Range

% Listed Property 100 90-100

Cash 0 0-10

Mercer Australian Direct Property10 Investment Strategy This Investment Option invests in Australian direct property investments across the commercial, retail and industrial sectors using a multi-manager approach.

Benchmark

Mercer/IPD Australian Pooled Property Fund Index

Objective



year or greater.

Standard Risk Measure Medium to high


Asset Allocation


Range %

Direct Property 100 80-100

Cash 0 0-20

8 Previously known as Mercer Emerging Markets 9 Previously known as Mercer Listed Property 10 Previously known as Mercer Direct Property

21 AUGUST 2014 21


Mercer Global Listed Infrastructure11

Investment Strategy This Investment Option invests in listed infrastructure securities using a multi-manager approach.

Benchmark UBS Global 50/50 Infrastructure and Utilities Index - in A$ (Hedged)

Objective To outperform the notional return of a benchmark portfolio of suitable market indices over periods of one year or greater.



Asset Allocation


% Range

%

Listed Infrastructure 100 90-100

Cash 0 0-10

Mercer Global Unlisted Infrastructure12

Investment Strategy This Investment Option invests in unlisted infrastructure securities using a multi-manager approach.

Benchmark

CPI + 5%

Objective

To outperform the notional return of a benchmark portfolio

of suitable market indices over periods of one year or

greater.



Asset Allocation


% Range

%

Unlisted Infrastructure 100 80-100

Cash 0 0-20

Mercer Diversified Alternatives

Investment Strategy This Investment Option invests in alternative assets using a multi-manager investment approach.

Benchmark

UBS Bank Bill Index

Objective

To achieve a return (before investment management

fees) of at least 3.5% per annum above the return

on bank bills as measured by the UBS Bank Bill

Index over rolling five year periods.



At least five years

Asset Allocation


% Range

%

Alternatives 100 90-100

Cash 0 0-10

11 Previously known as Mercer Listed Infrastructure 12 Previously known as Mercer Unlisted Infrastructure


Mercer Australian Sovereign Bond Investment Strategy This Investment Option invests primarily in Australian sovereign bonds using a multi-manager approach.

Benchmark

UBS Australian Treasury Bond Index 0+

(All Maturities) Index

Objective


portfolio of suitable market indices over periods of

one year or greater.

Standard Risk Measure Low to medium


At least three years

Asset Allocation


% Range

%

Australian Sovereign Bonds 100 90-100

Cash 0 0-10

Mercer Global Sovereign Bond

Investment Strategy This Investment Option invests primarily in global sovereign bonds using a multi-manager approach.

Benchmark

JP Morgan Global Government Index (Custom) - in

A$ (Hedged)

Objective


portfolio of suitable market indices over periods of

one year or greater.


Low to medium



Asset Allocation


% Range

%

Global Sovereign Bonds 100 90-100

Cash 0 0-10

Mercer Australian Inflation Plus13

Investment Strategy The Fund invests primarily in Australian inflation linked bonds and interest rate protection strategies using a multi-manager approach. Benchmark Consumer Price Index (CPI)



Asset Allocation

Objective To achieve a return (after tax and investment management fees) that exceeds CPI increases by at least 1.5% per annum over rolling three year periods.

Asset Classes Target* %

Range %

Australian Sovereign and

Inflation Linked Bonds

80 0-100

Global Sovereign and Inflation

Linked Bonds

10 0-25

Cash 10 0-100


Medium

* This is the asset allocation as at the date of this PDS and may change in future.

13 Previously known as Mercer Australian Inflation Linked Bond

21 AUGUST 2014 23


Mercer Global Credit

Investment Strategy The Investment Option invests in global credit securities using a multi-manager approach.

Benchmark 60% Barclays Global Aggregate Corporate Index, and 40% Barclays Capital Global Aggregate ex Government ex Treasuries Index – both in A$ (Hedged)

Minimum Investment Timeframe At least five years

Asset Allocation

Objective To outperform the notional return of a benchmark portfolio of suitable market indices over periods of one year or greater.


Range %

Global Credit 90-100 100

Cash 0 0-10


Medium

Mercer Cash

Investment Strategy This Investment Option invests in cash and short term interest bearing investments.

Benchmark UBS Bank Bill Index

Objective To maintain the invested capital and achieve a return (before investment management fees) above that available on bank bills as measured by the UBS Bank Bill Index.

Minimum Investment Timeframe One year or less

Asset Allocation


Range %

Cash 100 n/a


Very low


DIVERSIFIED OPTIONS

Mercer Diversified Shares

Investment Strategy The Investment Option invests in Australian and international shares, including small capitalisation stocks (‘small caps’) and emerging markets, using a multi-manager approach.

Benchmark CPI

Objective To achieve a return (after tax and investment management fees) that exceeds CPI increases by at least 4.0% per annum over rolling seven year periods.



Asset Allocation


Range %

Australian Shares 47.0 30-60

International Shares 53.0 30-60

Cash 0.0 0-10

Mercer High Growth

Investment Strategy The Investment Option invests in a mix of investments using a multi-manager investment approach.

Benchmark CPI

Objectives

To achieve a return (after tax and investment management fees) that exceeds CPI increases by at least 3.5% per annum over rolling six year periods.

To achieve a return (over the medium to longer term) that is competitive with comparable investment options that have a similar allocation to growth assets and similar risk characteristics.


Minimum Investment Timeframe At least six years

Asset Allocation


Range %



Property and Infrastructure 18.0 0-30

Alternative Assets 9.5 0-15

Growth Fixed Interest 1.5 0-10

Fixed Interest 8.0 0-20

Cash 0.0 0-15

21 AUGUST 2014 25


Mercer Growth Plus

Investment Strategy This Investment Option invests in a mix of investments using a multi-manager investment approach.

Benchmark CPI

Objectives

To achieve a return (after tax investment management fees) that exceeds CPI increases by at least 3.5% per annum over rolling five year periods.


Standard Risk Measure Medium


Asset Allocation


Range %







Cash 0.0 0-20

Mercer Growth


Benchmark CPI

Objectives

To achieve a return (after tax and investment management fees) that exceeds CPI increases by at least 3.0% per annum over rolling five year periods.


Standard Risk Measure Medium


Asset Allocation


% Range

%







Cash 3.0 0-15


Mercer Moderate Growth


Benchmark

CPI

Objectives

To achieve a return (after tax and investment management fees) that exceeds CPI increases by at least 2.5% per annum over rolling four year periods.


Standard Risk Measure Low to medium

Minimum Investment Timeframe At least four years

Asset Allocation


% Range

%







Cash 15.0 5-30

Mercer Conservative Growth

Investment Strategy

This Investment Option invests in a mix of

investments using a multi-manager investment

approach.

Benchmark

CPI

Objectives

To achieve a return (after tax and investment management fees) that exceeds CPI increases by at least 2.0% per annum over rolling three year periods.



Low

Minimum Investment Timeframe At least three years

Asset Allocation


% Range

%







Cash 28.0 10-40

21 AUGUST 2014 27


Mercer Defensive

Investment Strategy

This Investment Option invests in a mix of

investments using a multi-manager investment

approach.

Benchmark

CPI

Objectives

To achieve a return (after tax and investment management fees) that exceeds CPI increases by at least 1.5% per annum over rolling two year periods.


Standard Risk Measure Low

Minimum Investment Timeframe At least two years

Asset Allocation


Range %




Alternative Assets 2.0 0.10



Cash 40.0 20-60


Fees and other costs

DID YOU KNOW?

Small differences in both investment performance and fees and costs can have a substantial impact on your long term returns. For example, total annual fees and costs of 2% of your account balance rather than 1% could reduce your final return by up to 20% over a 30 year period (for example, reduce it from $100,000 to $80,000).

You should consider whether features such as superior investment performance or the provision of better member services justify higher fees and costs. Your employer may be able to negotiate to pay lower administration fees. Ask the fund or your financial adviser. TO FIND OUT MORE

If you would like to find out more, or see the impact of the fees based on your own circumstances, the Australian Securities and Investments Commission (ASIC) website (www.moneysmart.gov.au) has a superannuation fee calculator to help you check out different fee options. This document shows fees and other costs that you may be charged. These fees and other costs may be deducted from your money, from the returns on your investment or from the assets of the superannuation entity as a whole. Other fees, such as activity fees, advice fees for personal advice and insurance fees, may also be charged, but these will depend on the nature of the activity, advice or insurance chosen by you. Taxes are set out in the Taxation section on page 36 of this PDS. Please also refer to the heading ‘GST’ in the Additional explanation of fees and costs section of the PDS for an explanation of the impact of GST on the fees and charges described in this PDS. You should read all the information about fees and other costs because it is important to understand their impact on your investment.

21 AUGUST 2014 29


Fees and other costs table

Mercer Super Investment Trust

Type of fee Amount How and when paid

Investment fee1 Investment option Investment management fee (%pa of your total investment in the option)

Estimated performance fee3 (%pa of your total investment in the option)

Single sector

Mercer Australian Shares 0.90 Nil

Mercer Australian Shares Plus2 1.05 0.04

Mercer Australian Small Companies 1.00 0.72

Mercer International Shares 0.98 Nil

Mercer Hedged International Shares2 1.00 Nil

Mercer International Shares Plus 1.05 Nil

Mercer Hedged International Shares Plus2 1.07 Nil

Mercer Global Small Companies Shares 1.30 Nil

Mercer Emerging Markets Shares 1.40 Nil

Mercer Global Listed Property2 1.05 Nil

Mercer Australian Direct Property 1.25 Nil5

Mercer Global Listed Infrastructure2 1.05 0.24

Mercer Global Unlisted Infrastructure 1.50 0.47

Mercer Diversified Alternatives 3.12 1.13

Mercer Australian Sovereign Bond2 0.35 Nil

Mercer Global Sovereign Bond2 0.35 Nil

Mercer Australian Inflation Plus 2 0.45 Nil4

Mercer Global Credit2 0.55 Nil

Mercer Cash 0.30 Nil

Diversified

Mercer Diversified Shares 0.95 0.01

Mercer High Growth 1.00 0.09

Mercer Growth Plus 1.03 0.12

Mercer Growth 0.93 0.08

Mercer Moderate Growth 0.87 0.07

Mercer Conservative Growth 0.80 0.05

Mercer Defensive2 0.74 0.04

The investment fee is generally calculated and deducted daily (from the relevant Investment Option) when unit prices are determined, and are reflected in the value of your account balance.

1. Includes the investment management fee and an estimated performance fee, as described on page 33).

2. The investment management fee for these options shall not exceed 4% per annum. See Maximum fees on page 35.

3. The estimated performance fee is based on the performance fee paid during the period 1 July 2013 to 30 June 2014.

4. The Mercer Australian Inflation Plus Investment Option has a performance based fee for the first time, therefore no historical estimate is available. It is expected that the performance fee may range from 0-0.10% per annum.

5. Although the historical performance fee for the Mercer Australian Direct Property Investment Option is nil, we anticipate the future expected performance fee may range from 0-0.15% per annum.


Fees and other costs table (continued) Mercer Super Investment Trust


Administration fee6

Investment option

Administration fee (%pa of your total investment in the option)

Single sector

Mercer Australian Shares 0.05

Mercer Australian Shares Plus 0.07

Mercer Australian Small Companies 0.07

Mercer International Shares 0.07

Mercer Hedged International Shares 0.07

Mercer International Shares Plus 0.07

Mercer Hedged International Shares Plus 0.07

Mercer Global Small Companies Shares 0.07

Mercer Emerging Markets Shares 0.07

Mercer Global Listed Property 0.07

Mercer Australian Direct Property 0.07

Mercer Global Listed Infrastructure 0.07

Mercer Global Unlisted Infrastructure 0.07

Mercer Diversified Alternatives 0.07

Mercer Australian Sovereign Bond 0.07

Mercer Global Sovereign Bond 0.07

Mercer Australian Inflation Plus 0.07

Mercer Global Credit 0.07

Mercer Cash 0.09

Diversified

Mercer Diversified Shares 0.06

Mercer High Growth 0.06

Mercer Growth Plus 0.07

Mercer Growth 0.08

Mercer Moderate Growth 0.07

Mercer Conservative Growth 0.07

Mercer Defensive 0.07

The administration fee is generally calculated and deducted daily (from the relevant Investment Option) when unit prices are determined, and are reflected in the value of your account balance.

Table continued overleaf

6. The estimated administration fee is based on the administration fee paid during the period 1 July 2013 to 30 June 2014.

21 AUGUST 2014 31


Fees and other costs table (continued)



Buy/sell spread7

Investment Option

Estimated buy

spread (%)

Estimated sell

spread (%)

Single sector

Mercer Australian Shares 0.28 0.28

Mercer Australian Shares Plus 0.30 0.30

Mercer Australian Small Companies 0.38 0.38

Mercer International Shares 0.24 0.24

Mercer Hedged International Shares 0.25 0.25

Mercer International Shares Plus 0.26 0.26

Mercer Hedged International Shares Plus 0.27 0.27

Mercer Global Small Companies Shares 0.30 0.30

Mercer Emerging Markets Shares 0.34 0.34

Mercer Global Listed Property 0.25 0.20

Mercer Australian Direct Property Nil Nil

Mercer Global Listed Infrastructure 0.22 0.20

Mercer Global Unlisted Infrastructure 0.06 0.06

Mercer Diversified Alternatives Nil Nil

Mercer Australian Sovereign Bond 0.02 0.04

Mercer Global Sovereign Bond 0.10 0.10

Mercer Australian Inflation Plus Nil Nil

Mercer Global Credit 0.31 0.31

Mercer Cash Nil Nil

Diversified

Mercer Diversified Shares 0.26 0.26

Mercer High Growth 0.25 0.22

Mercer Growth Plus 0.22 0.20

Mercer Growth 0.22 0.20

Mercer Moderate Growth 0.18 0.16

Mercer Conservative Growth 0.14 0.12

Mercer Defensive 0.09 0.09

The buy spread is applied at the time of making an application into an Investment Option (or transferring an investment between Investment Options) and the sell spread is applied at the time of withdrawal.

Switching fee8 Nil Not applicable

Exit fee8 Nil Not applicable

Advice fees Nil Not applicable

Other fees and costs

Nil Not applicable

7. Buy/sell spreads are subject to change. See Buy/sell spreads on page 34.

8. See Maximum fees on page 35.


Fees and other costs table (continued)



Indirect cost ratio9

Investment Option

Indirect cost ratio (%pa of your total investment in the option)

Single sector

Mercer Australian Shares 0.04

Mercer Australian Shares Plus 0.04

Mercer Australian Small Companies 0.08

Mercer International Shares 0.04

Mercer Hedged International Shares 0.02

Mercer International Shares Plus 0.02

Mercer Hedged International Shares Plus 0.02

Mercer Global Small Companies Shares 0.06

Mercer Emerging Markets Shares 0.06

Mercer Global Listed Property 0.10

Mercer Australian Direct Property 0.05

Mercer Global Listed Infrastructure 0.05

Mercer Global Unlisted Infrastructure 0.04

Mercer Diversified Alternatives 0.05

Mercer Australian Sovereign Bond 0.02

Mercer Global Sovereign Bond 0.04

Mercer Australian Inflation Plus 0.04

Mercer Global Credit 0.03

Mercer Cash 0.02

Diversified

Mercer Diversified Shares 0.03

Mercer High Growth 0.04

Mercer Growth Plus 0.05

Mercer Growth 0.03

Mercer Moderate Growth 0.03

Mercer Conservative Growth 0.03

Mercer Defensive 0.02

The indirect cost ratio is generally calculated and deducted daily (from the relevant Investment Option) when unit prices are determined, and are reflected in the value of your account balance.

9. The estimated indirect cost ratio is based on the indirect cost ratio paid during the period 1 July 2013 to 30 June 2014.

Please refer to the Additional explanation of fees and costs section below for more information on the Trust’s fees and costs.

21 AUGUST 2014 33


Example of annual fees and costs This table gives an example of how the fees and costs of the Mercer Growth Investment Option can affect your investment over a one year period. You should use this table to compare this product with other managed investment products. EXAMPLE – the Mercer Growth Investment Option BALANCE OF $50,000 Investment fees1 0.97% For every $50,000 you have in the Mercer Growth Investment

Option you will be charged $485 each year

PLUS Administration fees

0.08% And, an administration fee of approximately $40 each year will be deducted from your investment

PLUS Indirect costs 0.03% And, an indirect cost ratio of approximately $15 each year will be deducted from your investment

EQUALS Cost of Mercer Growth Investment Option

If your balance was $50,000, then for that year you will be charged fees of $540.

(1) Includes the investment management fee of 0.93% per annum and estimated performance fee of 0.04% per annum. Historical fees and costs are not an accurate indication of the fees and costs you may pay in the future.

Additional explanation of fees and costs

Investment fee

The investment fee for each Investment Option consists of an investment management fee and a performance fee (where applicable). Investment management fee The Trustee may engage one or more investment managers to invest and manage the assets of an Investment Option. In doing so, the Trustee may negotiate a fee schedule with an investment manager under which the fee payable by the Trustee to the investment manager increases or decreases based on the overall amount of assets, managed by the investment manager for the underlying funds or direct investments. The investment management fee payable in respect of an Investment Option will not vary for any such increase or decrease in the fees payable to any investment manager, with the exception of any performance fee element as detailed below under Performance fees. Where an Investment Option invests in another Mercer fund or a fund managed by another investment manager, the investment management fee in the Fees and other costs table on page 29 includes the investment management fee for the underlying fund/s. Performance fees The performance fee forms part of the investment fee. Where an investment manager charges a performance fee, that fee will be passed onto investors by way of an adjustment to the unit price, which will reduce the investment performance of the relevant Investment Option. Investment managers that charge a performance fee only apply those fees when performance is greater

than an agreed target. Accordingly, performance fees arise when higher returns, relative to a specified target for a particular manager, are achieved. As the performance fees are based on investment managers achieving return targets, it is not possible to provide a forward-estimate for the performance fee that will be applicable to individual Investment Options. However, set out above on page 28 is the estimated performance fee for 2014/2015, which is based on the actual performance fee paid for each Investment Option for the period 1 July 2013 to 30 June 2014 (where performance fees are applicable). Historical fees and costs may not be an accurate indicator of the fees and costs you pay in the future. Actual performance fees paid are disclosed in the annual financial report. Where an Investment Option invests in another Mercer fund or a fund managed by another investment manager, the performance fee estimate in the Fees and other costs table (page 29) includes any performance fee estimate for the underlying fund/s.

Administration fee

The Trustee has the right to be reimbursed from the assets of the Trust for all administrative costs it incurs in the proper performance of its duties in administering the Trust. The Trustee deducts an amount for expenses out of the assets of each Investment Option, which is called an administration fee. The administration fee is included in the Fees and other costs table (page 30).


The administration fee for each Investment Option is passed on to investors by way of an adjustment to the unit price, which reduces the investment performance of the relevant Investment Option. The administration fee will vary from year to year reflecting the actual expenses incurred. The administration fee for a financial year will be reported to investors in the annual report and periodic statements as applicable. As the administration fee is not known until the end of the financial year, set out in the Fees and other costs table on page 30 is the administration fee for the 2013/2014 financial year. Historical fees and costs may not be an accurate indicator of the fees and costs you pay in the future. Actual administration fees paid are disclosed in the annual financial report.

Indirect cost ratio

Where an Investment Option invests in another Mercer fund or a fund managed by another investment manager, the indirect cost ratio in the Fees and other costs table includes the expense allowance of the underlying fund/s where they are known to us and where they are not covered by the investment management fee. The indirect cost ratio will vary from year to year reflecting the actual expenses incurred. The indirect cost ratio for a financial year will be reported to investors in the annual report and periodic statements as applicable. As the indirect cost ratio is not known until the end of the financial year, set out on page 32 of the Fees and other costs table is the estimated indirect cost ratio for the 2013/2014 financial year that may apply for each Investment Option.

Buy/sell spreads

The buy/sell spreads are designed to ensure, as far as practicable, that any transaction costs incurred as a result of an investor applying to or withdrawing from an Investment Option are borne by that investor, and not other investors. The buy spread is applied at the time of making an application into an Investment Option (or transferring an investment between Investment Options) and the sell spread is applied at the time of withdrawal. The buy/sell spreads are not subject to GST. Buy/sell spreads will vary from time to time. Details of the buy/sell spreads applicable to each Investment Option (as at the date of this PDS) are set out in the Fees and other costs table on page 31. The Trustee may waive or reduce the buy/sell spreads at its discretion. No part of the buy/sell spread is paid to the Trustee or an investment manager.

Operational Risk Financial Requirement (ORFR) Reserve

In response to the Government’s Stronger Super reforms, the Trustee has established an Operational Risk Financial Requirement Reserve for the Trust. The Government has introduced this requirement so that super funds have access to resources to compensate members, where relevant, for any operational incident that adversely impacts their benefits. The cost of building up the reserve for the Mercer Super Investment Trust is currently being met by the Trustee’s capital. The size of the ORFR levy will be reported each year in the audited financial statements and is not currently incorporated within the fees and costs for the Trust. The Trustee will monitor the operational risks and the appropriateness of the ORFR reserve on an ongoing basis and may seek to increase the reserve by applying a levy as a deduction to the investors’ account balances in the future.

Additional fees and costs not included in management costs

The following fees and costs are additional to the management costs shown in the Fees and other costs table.

Transactional and Operational Costs

Transactional and operational costs associated with ongoing management and dealing with the Trust’s assets may also be recovered. Transactional and operational costs may include transactional brokerage, stamp duty, custodial settlement fees and the buy/sell spread of any underlying investment. These costs will differ according to the type of assets in the Trust, and will be paid out of the assets of the Trust.

Bank charges

Bank charges in relation to your investment may be payable by you. These charges may include telegraphic transfer, bank cheque and dishonour fees.

Additional units

The investment fee is charged by deduction from each Investment Option when the unit price is determined. If, however, a lower investment fee has been negotiated and your investment fee is less than the standard investment fee, additional units will be credited to your investment account monthly at the end of each month on the difference between the investment fee deducted from the unit price and the investment fee charged to you. Such additional units, if and when issued, will be appropriately adjusted for tax before being credited to your investment account.

21 AUGUST 2014 35


Fee increases

The Trustee has the right to increase fees to the maximums set out below at any time without the prior approval of investors. Reasons might include changes in economic conditions or government regulations. You will be provided with at least 30 days prior written notice of any such increase.

Maximum fees

Under the governing rules the Trustee has the right to charge maximum fees as follows:

A contribution fee* of 5.00% of any amount invested in the Trust.

A switching fee* of $2,173 (indexed annually) for each switching request received.

For Investment Options established before 1 July 2005, investment management fees shall not exceed 2.5% per annum of your investment. For Investment Options established on or after 1 July 2005, the investment management fee charged by the Trustee shall not exceed 4.0% per annum of your investment. See the Breakdown of management costs table for details of those Investment Options where a maximum fee of 4% applies.

A withdrawal fee* of $1,086 (indexed annually) from each amount paid out of the Trust.

* These fees are not charged by the Trust as at the date of

this PDS. Fees which are indexed annually are indexed with reference to changes in the full-time adult average weekly ordinary time earnings published by the Australian Bureau of Statistics. The Trustee currently charges the fees shown in the Fees and other costs table on pages 29 to 32 of this PDS. Any future fee increases will be within these maximums.

Negotiable fees

The Trustee reserves the right to negotiate fees with an investor having regard to factors such as the amount of their investment.

GST

The GST disclosures in this PDS are of a general nature only. GST will not be payable on units purchased in the Mercer Super Investment Trust. Fees payable in respect of the management of the Mercer Super Investment Trust are subject to GST, as detailed below. GST will apply to the management costs charged to the Mercer Super Investment Trust. Generally the Trust cannot claim full input tax credits in respect of these management costs, but will usually be entitled to reduced input tax credits in respect of some of these costs. As a result the management costs payable to us including GST are higher than those disclosed in this PDS. The management costs payable to us as set out in this PDS approximate the net cost of these management costs (after GST and net of reduced input tax credits that are expected to be available).

Fees charged on the re-investment of income distributions

The Trustee charges the fees referred to in the Fees and other costs table on pages 29 to 32 of this PDS and applies the buy/sell spread (if any) on any reinvestment of an income distribution into the Investment Options.

Rebate of investment management fee

An investment management fee of between 0.3% and 3.12% per annum (depending on the Investment Option/s chosen) is charged by deduction from the assets of each Investment Option when the unit price is determined. If, however, you have negotiated a lower investment fee, you will be reimbursed at the end of each month. This reimbursement will be made either as a direct payment to your nominated bank account or additional units will be credited to your investment in the relevant Investment Option/s. The amount of the reimbursement will be the difference between the investment fee deducted from the unit price and the investment fee negotiated by you.


Taxation The following information is a general summary only in relation to some of the Australian income tax issues that may arise from an investment in the Trust. The summary relates to qualifying Australian resident investors only, and is current as of the date of this PDS. Taxation laws are complex and can change with little notice. It is possible that changes to taxation laws in the future may alter the tax position of the Trust and investors. As individual circumstances differ, the taxation laws will affect individual investors in different ways. Accordingly the Trustee recommends that you seek your own professional advice on taxation matters.

Tax position of the Trust

The Trust is a pooled superannuation trust. In essence, the Trust is subject to tax in accordance with Division 295 of the Income Tax Assessment Act 1997. As such, as a general rule, its taxable income (including realised capital gains) is taxed at a tax rate of 15%. The Trust may be eligible for a one third discount in relation to the capital gains realised from the disposal of assets held for greater than twelve months.

Investment earnings

Generally, the Trustee is liable to pay tax at a maximum rate of 15% on:

All taxable investment income.

Realised capital gains from assets held for less than twelve months.

Two-thirds of realised capital gains from assets held for more than twelve months (after taking into account capital losses).

The effective tax rate of the Trust may be reduced below 15% due to the effect of various tax credits and rebates (such as franking credits attached to franked dividends and the one third discount on realised capital gains held for greater than twelve months). Where the franking credit exceeds the tax payable of the Trust, the Trust may be entitled to a refund for the excess from the ATO. Where the Trust invests in pooled superannuation trusts and/or statutory funds of life insurance companies, which are taxed on a similar basis to the Trust, the Trust will not be liable to pay tax on income or gains on these investments.

Segregated pension assets

Where a unit in the Trust is a segregated current pension asset of an investor that is a complying superannuation fund, the Trust may be entitled to an exemption for a proportion of the assessable income attributable to the unit (segregated current pension asset of the investor). Unless the investor provides written notification to the Trust, specifying the number of units that are segregated current pension assets of the investor, the Trust will assume that none of the units on issue are segregated current pension assets. Where an investor has provided written notification to the Trust indicating the number of units that are segregated current pension assets of the investor, the Trust will issue the investor with “pension units”. The net benefit of the tax exemption that the Trust receives should be reflected in the unit prices for the pension units. Investors that acquire pension units must notify the Trust in writing, when any of the pension units cease to be a segregated current pension asset of the investor.

Transfer of assessable contributions

Very broadly, the tax law allows complying superannuation funds or complying approved deposit funds to “transfer” certain assessable contributions to the Trust provided certain conditions are met. Where such a transfer occurs, the Trust will bear the tax liability on the assessable contributions. In order to “transfer” assessable contributions the investor and the Trust must enter an irrevocable “transfer agreement”. The Trust at its sole discretion may enter a transfer agreement with an investor. Where such a transfer agreement is entered, the tax liability associated with the transfer of assessable contributions will be indirectly borne solely by the investor. Investors seeking to transfer assessable contributions to the Trust should obtain their own tax advice on whether they can enter a transfer agreement with the Trust and the consequences of entering such an agreement.

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Tax position of investors

The Trust being a post-tax investment means the unit prices incorporates a provision for income tax, which includes capital gains tax (both realised and unrealised) and the entitlement to any tax credits. As the responsibility for the tax liability falls on the Trustee of the Trust, consequently tax payments and/or refunds are paid from/to the Trust. As an investor in the Trust you will not be assessed on the taxable income of the Trust. In addition, any capital gains or capital losses realised on the disposal of your units in the Trust are disregarded.

Segregated pension assets

Where an investor holds pension units in the Trust, the tax exemption that the Trust receives in relation to the pension units should be reflected in the unit prices of the pension units.

Transfer of assessable contributions

Where an investor and the Trust enters a transfer agreement to transfer assessable contributions to the Trust, the tax liability associated with the transfer of assessable contributions will be indirectly borne solely by the investor.

Collection of Tax File Numbers

Collection of tax file numbers is authorised, and its use and disclosure are strictly regulated, by the tax law and Privacy Act. Where you provide your Tax File Number (TFN) and Australian Business Number (ABN) to us, you acknowledge that we may supply your TFN or ABN, as applicable to other relevant parties. Any TFN information supplied on your Application will automatically be applied to all future investments in the Trust, unless you inform us otherwise. We are required to provide you with the following information before you supply your TFN to us. Your TFN is confidential, and you should be aware of the following details before you decide to provide it:

If you do provide your TFN to the Trustee, it will only be used for legal purposes.

It is not an offence if you choose not to quote your TFN. However, if you don’t provide the Trustee with your TFN or claim an exemption, the Trustee may be required to withhold more tax from your investment income than may otherwise be required. You may be entitled to claim a tax credit / offset in your income tax return for any TFN tax withheld.

For more information about the use of TFNs, please contact the Australian Taxation Office.


Other things you should knowDistribution of income

The Trust will not make distributions of investment income as long as it remains a pooled superannuation trust. All earnings on investments accumulate in the Trust and are reflected in unit prices. You may access investment income only through a request to us for the withdrawal of part of your investment.

Units and unit pricing

What are units?

The assets of each Investment Option are divided into units of equal value. Each time a payment is made into the Trust, units are issued in the relevant Investment Option at the issue price. Similarly, when payments are made from the Trust, units are redeemed by us from the relevant Investment Option at the withdrawal price. Please note that:

We will only allocate units when we receive all the information necessary to invest.

We may suspend the issue (or withdrawal) of units during any period in which we are of the opinion that the issue price (or withdrawal price) of those units cannot be calculated in a manner that is fair to all investors holding those units. We may also suspend the withdrawal of units if we are unable to realise sufficient underlying assets of the Investment Option in order to satisfy a withdrawal request.

Units are not transferable.

How and when are unit prices calculated?

The unit price of each Investment Option is calculated on a daily basis by us although we may recalculate prices more frequently when we consider it to be appropriate. We may issue or redeem or cancel fractions of units which will be dealt with as a unit but in the proportion that the fraction bears to a whole unit. The issue price and withdrawal price of a whole unit generally reflects the net asset value of the Investment Option divided by the number of units on issue for that Investment Option at the relevant time, adjusted for the cost of acquiring or disposing of the assets of the option. In special circumstances, we may use a different pricing methodology to determine the issue and withdrawal prices for a particular Investment Option, if we

believe that to do so will not prejudice the interests of other investors. In determining the unit prices, a notional allowance may be made for any applicable buy/sell spread and/or any applicable disposal costs. See the Additional fees and costs not included in management costs section on page 34. Unit prices are calculated to the fourth decimal place. The net asset value of an Investment Option reflects the value of the underlying assets of that Investment Option less any liabilities, provisions for taxation and other expenses related to that Investment Option. Unit prices may rise or fall depending on fluctuations in the underlying value of the investments in each Investment Option.

How are assets valued?

Unless we determine otherwise, the underlying assets of the Investment Options will be valued at their market value.

Accounts and audit

The financial report for the Trust is prepared annually by the Trustee (in accordance with the accounting standards applicable at that time) and is audited by an independent auditor. You can obtain a copy of the latest audited financial report from us, free of charge, by calling 1800 512 947.

Retirement of Trustee

The Trustee must retire if it ceases to be qualified to act as trustee of the Trust under superannuation laws. The Trustee may also retire at any time by giving 90 days’ written notice to investors. The Trustee must by deed appoint another company which is eligible to act as trustee of the Trust under law to act as trustee in its place whenever the Trustee retires. If no replacement trustee is appointed within 90 days after the Trustee’s retirement, the trust deed provides that the Trust will be terminated.

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Trustee powers and responsibilities

The Trustee is responsible for:

Ensuring investors’ rights and interests are protected.

The proper investment of assets.

The general operation of the Trust in accordance with the governing rules and applicable legislation.

The Trustee has the power to invest the assets of the Trust in real and personal property of any nature. The Trustee may not borrow money except for temporary borrowing:

Not exceeding 10% of the value of the assets of the Trust and the period of borrowing does not exceed 90 days to pay withdrawals; or

Not exceeding 10% of the value of the assets of the Trust and the period of borrowing does not exceed 7 days to settle securities transactions, provided that at the time the relevant investment decision was made, it was likely that the borrowing would not be needed and the borrowing is not exempt from the prohibition on borrowing.

The Trustee is paid a fee out of the fees charged to investors. Please refer to the Fees and other costs section on page 28 of the PDS for more details on fees. Mercer Investments (which is a separate business of MIAL), the custodian and unit registry administrator and the investment managers are paid to provide services to the Trustee by the Trustee out of the investment fee, administration fee, and indirect costs reflected in the indirect cost ratio.

Trustee’s indemnity

Both the Trustee and its directors are entitled to be indemnified, out of the assets of the Trust, against all liabilities, losses, costs and expenses which may be incurred in the proper exercise or purported exercise of the Trustee’s power in administering the Trust. This indemnity will not be available to the Trustee or its directors if there is a failure to act honestly in relation to a matter concerning the Trust, an intentional or reckless failure to exercise the degree of care and diligence required or a monetary penalty is imposed.

Service providers to the Trustee

The Trustee appoints service providers to assist it in running the Trust. The main service providers to the Trustee are the fund manager and the custodian and unit registry administrator, details of which are set out below.

Fund manager

The Trustee has appointed Mercer Investments to be the fund manager of the Trust. Mercer Investments provides the following services for the Trustee:

Designing Investment Option objectives.

Recommending mix of investments and investment managers to manage the underlying assets in each Investment Option.

Implementing investment decisions that are approved by the Trustee.

The ongoing review and monitoring of the functions above.

Custodian and unit registry administrator

The Trustee has appointed National Australia Bank Limited ABN 12 004 044 937 to act as custodian and unit registry administrator for the Trust.

The governing rules

The Trust is governed by a trust deed, the Corporations Act and superannuation laws, which set out the rules and procedures under which the Trust operates together with the Trustee’s duties and obligations to investors. The Trust is a pooled superannuation trust for the purposes of superannuation laws. This enables the Trust to be taxed at concessional rates. The Trustee can also deduct tax as appropriate from investors’ investment account balances.

Amendment of governing rules

From time to time it may be necessary to amend the provisions of the governing rules. We have the power to amend all or any of the provisions of the trust deed and any amendment must also comply with the trust deed and any regulatory requirements.


Closing the Trust

The Trust is an indefinitely continuing fund with no fixed termination date. We may terminate the Trust at any time. The Trust may also be terminated if we retire and no replacement is appointed within 90 days of our retirement (see the Retirement of Trustee section on page 38 of this PDS). Upon termination, the Trustee must realise the property of the Trust, discharge all liabilities, pay the expenses of termination and then, subject to meeting the requirements of the trust deed, distribute the balance to investors in proportion to their investment account balances.

Rights of investors

Investors are entitled to a beneficial interest in the Trust. However, you are not entitled to interfere with, or exercise, the powers of the Trustee in respect of any Trust property, liability or obligation or to lodge a caveat over Trust property. The rights of investors include:

To have units allocated to, and redeemed from, their investment accounts subject to any restrictions contained in the trust deed.

To participate in the distribution of assets on the winding up of the Trust.

To receive various information concerning their interest in the Trust and the Trust in general.

Being an investor in the Trust entitles a person to a beneficial interest in the Trust as a whole, not in parts of or single assets of the Trust.

Liability of investors

Under the trust deed, the liability of each investor of the Trust is limited to the amount standing to the credit of their investment account. The trust deed gives us powers to recoup amounts from investors in relation to taxation liabilities.

Material changes or significant events

You will be provided with at least 30 days’ notice of any proposed increases in fees or charges. All other material changes or significant events will be advised in accordance with the requirements of the law.

Monitoring enquiries

The Trustee may, at its discretion, monitor or record enquiries or transactions made by telephone. This is done for reasons of accuracy, security and service.

Cooling off

Cooling-off refers to a right to cancel your investment in the Trust. Investors will generally have this right if they are a trustee of a regulated superannuation fund that has net assets of less than $10 million on the date they first invest in the Trust. If you are entitled to cooling-off, then you have 14 days during which you can write to us to cancel your investment in the Trust. This is called the “cooling-off” period. The 14 day period starts from the earlier of the date you receive our letter confirming your unit holding or five days after you become an investor. You will lose your right to cooling-off if you exercise any other right under this product within the 14 day period. If you cancel your unit holding during the cooling-off period your investment will be refunded. The amount refunded will be calculated by reference to the price at which the units would have been acquired if you had acquired them on the day the cooling-off right is exercised, adjusted for tax and reasonable transaction or administration costs. Therefore, the amount refunded may be greater or less than the amount initially paid. Cooling-off rights will not apply when units are issued as a result of additional contributions, investment income distributions, investment fee rebates or switches between Investment Options.

Privacy

The Trustee collects, discloses, uses and holds certain personal information about investors. We understand that by holding this information we have obligations to you as to the manner in which we deal with that information. The Trustee complies with the Australian Privacy Principles as described in the Privacy Act 1988 (Cth), as amended. Mercer has a Privacy Policy that describes in more detail the manner in which the Trustee will deal with your personal information. Mercer’s Privacy Policy is available to view at www.mercer.com.au or you can obtain a copy by contacting the Helpline on 1800 512 947. In the section Your personal information below, we have set out the information we hold about you and how we will deal with that information. We assume that you consent to the manner in which we collect, disclose, use and hold your personal information. If you do not provide the personal information requested, the Trustee may not be able to manage your investment.

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Your personal information

The information the Trustee holds may include, but is not limited to, your:

─ Name and address. ─ Date of birth. ─ Telephone number and email address. ─ Tax file number.

This information is collected, used and disclosed so that the Trustee can manage your investment and give you information about your investment.

The Trustee seeks to obtain this information from you directly. Sometimes, however, information may be obtained from third parties, such as a super fund, where it is impractical to obtain the information from you directly.

The Trustee may disclose your personal information to a variety of organisations in order to manage your investment. These organisations may include:

─ Other companies related to the Trustee that provide services or financial products relevant to the provision of your investment.

─ The Trustee’s professional advisers, e.g. legal advisers, accountants and actuaries.

─ Any relevant government authority that requires your personal information to be disclosed, e.g. the Australian Taxation Office or AUSTRAC.

─ Other service providers used by the Trustee to assist it to manage or provide your super.

Your personal information may also be used for marketing and research purposes, including sending you information about financial products and services offered by the Trustee or any of its related parties. You can notify the Trustee at any time (by contacting the Helpline on 1800 512 947) if you do not wish to receive marketing material.

The Mercer Privacy Policy sets out in more detail how the Trustee deals with your personal information and who you need to talk to if:

─ You wish to review information held by the Trustee about you.

─ You believe that the information the Trustee holds about you is incorrect and needs to be corrected.

─ You believe the Trustee has not dealt with your personal information in accordance with the law or the Mercer Privacy Policy and how you can make a complaint and how that complaint will be handled.

In providing and managing your investment your personal information may be stored, disclosed or viewed by service providers in another country. Mercer’s Privacy Policy will include information regarding any relevant offshore locations, if applicable in the future.

Enquiries and complaints procedures

The Trustee has a process in place for dealing with any enquiries and complaints. If you have an enquiry or complaint you can call us on 1800 512 947 or write to:

Mercer Investment (Australia) Limited GPO Box 9946 Melbourne VIC 3001

We will acknowledge complaints within 14 days and communicate our decision to you within 45 days. The Trustee seeks to resolve any complaints to the satisfaction of all concerned and in the best interests of all the investors of the Trust. However, if you have followed the steps outlined above and are not satisfied with the outcome, you may be able to take your complaint to the Financial Ombudsman Service (FOS). FOS is an external dispute resolution system that covers certain complaints by investors in superannuation schemes. For more information, you can contact FOS via:

Telephone 1300 78 08 08 Facsimile (03) 9613 6399 Website www.fos.org.au Email [email protected] Mail Financial Ombudsman Service

GPO Box 3, Melbourne, Victoria, 3001

Conflicts of Interests Policy

When the Trustee transacts with a related party, it takes steps to ensure that any conflicts that may arise as a result are dealt with in accordance with its ‘Conflicts Management Framework’. The Trustee has prepared a policy for Managing Conflicts of Interests, which describes the arrangements that the Trustee has in place for managing situations giving rise to actual, apparent, and potential conflicts of interest. Compliance with this policy is monitored by the Trustee via its Risk Management Committee. The Policy sets out the Trustee's approach to related party transactions, including the provision of services by related parties, the approach taken for product pricing, and the process used in the appointment of underlying investment managers. The policy is reviewed annually (or more frequently if circumstances require) to ensure that the arrangements continue to be adequate for identifying, assessing and managing conflicts of interests.


Disclosure of interests and Related Party Transactions

The interests of the Trustee and other persons named in this PDS and details of related party transactions are as follows:

The Trustee is paid an Investment management fee for managing the Trust. This fee is disclosed in the Fees and other costs section of this PDS. Where Investment Options subsequently invest in funds which are also managed by the Trustee no additional fees are charged by the Trustee in its role as responsible entity/trustee of the underlying funds.

The Trustee is also entitled to be indemnified and reimbursed out of Trust assets for liabilities and expenses incurred in the proper performance of its duties in accordance with the provisions of the trust deed. These expenses will also include specialist services provided by MIAL for custodian monitoring and reporting which are provided on usual commercial terms and on an arm’s length basis. These fees are included in the administration fee and indirect costs reflected in the indirect cost ratio as set out in the Fees and other costs section, which starts on page 28 of this PDS.

Certain Investment Options invest in overseas investment vehicles managed by other Mercer companies. In some cases these companies receive a fee for services provided. Any such fees are paid out of the investment management fee. All investments are made on

usual commercial terms on an arm’s length basis.

Mercer (Australia) Pty Ltd (MAPL) provides staff and other resources to the Trustee. These services are paid for by the Trustee out of its investment management fee.

MAPL also provides MIAL with certain specialised services, such as company secretariat services, which are paid for by the Trustee out of Trust assets and therefore included in the administration fee. The arrangements by which these services are provided and the fees payable to MAPL are made on usual commercial terms on an arm’s length basis.

In addition to acting as Trustee of the Trust, MIAL conducts an investment consulting business and in this capacity provides certain specialised consulting services to the Underlying Funds in which the Trust invests, including specialised assets consulting, custodial monitoring and reporting and transition management services. MIAL is paid a fee out of Underlying Funds assets for the provision of these services. All services are provided on usual commercial terms on an arm’s length basis. Where these fees are paid out of Underlying Funds assets, they are included in the indirect cost reflected in the indirect cost ratio disclosed in the Fees and other costs section (starting on page 28 of this PDS).

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How to invest in the Mercer Super Investment TrustMaking an initial investment

To apply for membership of the Trust you will need to complete each relevant section of the Application Form attached to this PDS and send the original Application Form to the Trustee:

(a) Together with a cheque made payable to NNL Atf Mercer Investments (Australia) Ltd Application Account (crossed Not Negotiable); or (b) Arrange for a transfer of money to the Trust’s bank account via Electronic Funds Transfer, Direct Credit or RTGS.

If you would like to electronically transfer monies to our bank account, we require written confirmation of the amount to be transferred on or before the time of the transfer taking place. Transfers should be made to the following account.

Bank: National Australia Bank

Account name: NNL Atf Mercer Investments (Australia) Ltd Application Account

BSB: 083-043

Account number: 813756075

Where a properly completed original Application Form (together with a cheque or transferred funds confirmed as cleared funds on that business day) is confirmed as received by the Trustee before 3:00pm Melbourne time on a business day, the unit price used will generally be that applicable at the close of business that day. Where a properly completed Application Form (together with a cheque or transferred funds confirmed as cleared funds on that business day) is received on or after 3:00pm, it will be processed on the next business day. By business day we mean any day, other than a Saturday or Sunday, on which banks are open for business in Melbourne. Please see Buy/sell spreads on page 34 of this PDS for information on the effect of the buy/sell spread on payments into the Investment Options. Application moneys will be held in the Trust’s bank account for up to one month by us pending receipt of a properly completed original Application Form. Where application moneys are pending receipt of a properly completed Application Form after one month of receipt, we will return the application money to the sender.

We may refuse to accept any application at our discretion. Any interest earned on application moneys held in the Trust’s bank account will be invested in the investor’s selected Investment Option/s with their application moneys upon receipt of a properly completed Application Form. In the event a properly completed Application Form is not received after one month any interest earned will be returned to the sender with their application moneys. Applications should be sent to us via fax or post. Fax: 1300 365 601 Post: Registry Services

GPO Box 1406 Melbourne Vic 3001

Anti-Money Laundering and Counter-Terrorism Financing legislation

The Trustee is required to collect and verify additional information about you at the time of your initial investment under Anti-Money Laundering and Counter-Terrorism Financing legislation.

When the Trustee receives a properly completed Application Form it must collect and verify the identity of investors at the time of initial investment. This requires each investor to provide the following identification information (a list of documents that meet the criteria below can be found in the Identification documents section of this PDS). The Trustee is also required to:

Collect customer identification information before processing certain transactions (including withdrawals).

Monitor, mitigate and manage the risk of being involved in or facilitating money laundering or financing of terrorism.

The Trustee will not process a transaction if the customer identification information is not provided or if the Trustee is concerned that a transaction may breach or cause it to breach any requirement under the Anti-Money Laundering and Counter-Terrorism Financing laws.


Investor identification requirements

A) Investor identification documents for

individuals and sole traders

Your application will only be processed if accompanied with the following information:

An original or certified copy of a primary photographic identification document; or

Both:

─ An original or certified copy of a primary non-photographic identification document; and

─ An original or certified copy of a secondary identification document.

These terms are defined in the Identification documents section, below.

B) Investor identification documents for

companies

The Responsible Entity will verify company information by obtaining one or a combination of the following:

A search of the relevant domestic stock exchange.

A public document issued by the relevant company.

A search of the relevant ASIC database.

A search of the licence or other records of the relevant regulator.

C) Investor identification documents for trustees

Your application will only be processed if accompanied with the following information:

The full name of the trust from a certified copy or certified extract of the trust deed.

If the trustee is an individual, then information about the individual as set out in A) of this section.

If the trustee is a company, then information about the company as set out in B) of this section.

If the trustee comprises individuals and companies then information about both the individual and company as set out in A) and B) of this section.

Identification documents

Primary photographic identification

documents

A primary photographic identification document means any of the following:

A licence or permit issued under a law of a State or Territory or equivalent authority of a foreign country for the purpose of driving a vehicle that contains a photograph of the person in whose name the document is issued.

A passport issued by the Commonwealth.

A passport or a similar document issued for the purpose of international travel, that:

─ Contains a photograph and the signature of the person in whose name the document is issued;

─ Is issued by a foreign government, the United Nations or an agency of the United Nations; and

─ If it is written in a language that is not understood by the person carrying out the verification - is accompanied by an English translation prepared by an accredited translator.

A card issued under a law of a State or Territory for the purpose of proving the person’s age which contains a photograph of the person in whose name the document is issued.

A national identity card issued for the purpose of identification, that:

─ Contains a photograph and the signature of the person in whose name the document is issued;

─ Is issued by a foreign government, the United Nations or an agency of the United Nations; and

─ If it is written in a language that is not understood by the person carrying out the verification - is accompanied by an English translation prepared by an accredited translator.

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Primary non-photographic identification documents

A primary non-photographic identification document means any of the following:

A birth certificate or birth extract issued by a State or Territory.

A citizenship certificate issued by the Commonwealth.

A citizenship certificate issued by a foreign government that, if it is written in a language that is not understood by the person carrying out the verification, is accompanied by an English translation prepared by an accredited translator.

A birth certificate issued by a foreign government, the United Nations or an agency of the United Nations that, if it is written in a language that is not understood by the person carrying out the verification, is accompanied by an English translation prepared by an accredited translator.

A pension card issued by Centrelink that entitles the person in whose name the card is issued, to financial benefits.

Secondary identification documents

A secondary identification document means any of the following:

A notice that:

─ Was issued to an individual by the

Commonwealth, a State or Territory within

the preceding twelve months;

─ Contains the name of the individual and his

or her residential address; and

─ Records the provision of financial benefits to

the individual under a law of the

Commonwealth, State or Territory (as the

case may be).

A notice that:

─ Was issued to an individual by the Australian

Taxation Office within the preceding 12

months;



─ Records a debt payable to or by the

individual by or to (respectively) the

Commonwealth under a Commonwealth law

relating to taxation.

A notice that:

─ Was issued to an individual by a local

government body or utilities provider within

the preceding three months



─ Records the provision of services by that

local government body or utilities

provider to that address or to that

person.

In relation to a person under the age of 18, a notice that:

─ Was issued to a person by a school

principal within the preceding three

months;

─ Contains the name of the person and his


─ Records the period of time that the

person attended at the school.

How to certify documents

The person who is authorised to certify documents must:

(i) Sight the original and the copy and make sure both documents are identical.

(ii) Write or stamp ‘certified true copy’ on each page, along with his or her signature, printed name, date and qualification (such as Justice of the Peace, Australia Post employee, etc).

Who can certify documents?

Any one of the following authorised persons can certify documents as being true and correct copies:

Police Officer.

Justice of the Peace.

Australia Post Office Employee (permanent employee who has worked for the post office for at least two continuous years).

Agent of Australia Post who is in charge of a post office.

Barrister or Solicitor (who is enrolled on the roll of a State or Territory Supreme Court or the High Court of Australia, as a legal practitioner).

Finance Company Officer, such as a Bank Manager or Bank Employee (who has worked for one or more Finance Companies for a total of at least two continuous years).


After you have joined Making additional investments

Additional investments are made on the terms of the then current PDS. You should obtain and read a copy of the current PDS before making any additional investments into the Trust. Copies of the current PDS can be obtained by calling 1800 512 947. You do not need to complete another Application Form when making additional investments (i.e. applying for further units) in the Trust (subject to a minimum investment amount of $20,000). However, you will need to complete and send us a written additional investment request that contains:

Your account number.

Your account name.

Your postal address and contact phone number.

Method of payment, either by cheque or by electronic payments (see below for further details).

The Investment Option/s you would like to invest in and the amount.

The request must also include the signatures of appropriately authorised signatories.

You may pay the additional investment to us either by:

A cheque made payable to NNL Atf Mercer Investments (Australia) Ltd Application Account (crossed Not Negotiable); or

A transfer of money into the Trust’s bank account via Electronic Funds Transfer, direct credit or RTGS.

Bank National Australia Bank BSB 083-043 Account 813756075

The additional investment request should be sent to us via fax or post.

Fax: 1300 365 601

Post: Registry Services GPO Box 1406 Melbourne Vic 3001

By submitting an additional investment request in the above manner, you agree and acknowledge that:

You have received, read and agreed to be bound by the terms of the then current PDS.

Your personal information will be handled by the Trustee to provide and manage your investment and you consent to your personal information being handled in the manner disclosed in the PDS.

Where a properly completed original additional investment request (together with a cheque or transferred funds confirmed as cleared funds on that business day) is confirmed as received by the Trustee:

Before 3:00pm Melbourne time on a business day, the unit price used will generally be that applicable at the close of business that day; or

On or after 3:00pm, it will be deemed to have been received the next business day.

By business day we mean any day, other than a Saturday or Sunday, on which banks are open for business in Melbourne. Please see Buy/sell spreads on page 34 of this PDS for information on the effect of the buy/sell spread on payments into the Trust. We may refuse to accept any additional investment at our discretion. Application moneys will be held in the Trust’s bank account for up to one month by us pending receipt of a properly completed original additional investment request. Where application moneys are pending receipt of a properly completed original additional investment request after one month of receipt, we will return the application money to the sender. Any interest earned on application moneys held in the Trust’s bank account will be invested in the investor’s selected Investment Option/s with their application moneys upon receipt of a properly completed Application Form. In the event a properly completed Application Form is not received after one month any interest earned will be returned to the sender with their application moneys.

21 AUGUST 2014 47


Requesting a withdrawal payment

You may withdraw all or part of your investment in any of the Investment Options by lodging a properly completed original withdrawal request with us and subject to a minimum withdrawal of $1,000 being made. The request must include the signatures of appropriately authorised signatories and must specify:


Your account name.

Your postal address and phone number.

Details of your nominated bank account:

─ Bank name and branch.

─ Account name.

─ BSB and account number.

Instructions on whether this request is a partial or full withdrawal (in the latter case, we will also treat your withdrawal request as a request to close your investment account).

The amount of your investment (in dollars) or the number of units that you wish to withdraw from each relevant Investment Option.

Once completed, the withdrawal request should be sent to us via fax or post. Fax: 1300 365 601 Post: Registry Services


Under the Trust Deed and subject to the Trustee’s ability to suspend withdrawals, the Trustee can complete a withdrawal request up to sixty days after its lodgement by the investor. However, normally a withdrawal request will be completed within ten business days. In the case of the Mercer Australian Direct Property investment option and the Mercer Diversified Alternatives investment option, where those options are liquid (within the meaning of the Corporations Act), a withdrawal request must generally be satisfied by the Trustee within 18 months of receipt. In the case of the Mercer Global Unlisted Infrastructure investment option, where that option is liquid (within the meaning of the Corporations Act), a withdrawal request must generally be satisfied by the Responsible Entity within five years of receipt. In the event that any of the investment options become non-liquid (as defined in the Corporations Act 2001 (Cth)) investors will only be able to make a withdrawal from that investment option in accordance with the requirements of the Corporations Act 2001 (Cth).

You should also be aware that we may:

Suspend the issue or withdrawal of units referable to an Investment Option during any period in which we are of the opinion that the issue price or withdrawal price of those units cannot be calculated in a manner that is fair to all investors holding those units; or

Suspend the withdrawal of units referable to an Investment Option during any period in which we are unable to realise sufficient underlying assets of the Investment Option in order to satisfy fully a withdrawal request.

If your withdrawal request (including all necessary information and appropriate authorised signatures) is received:

Before 3:00pm Melbourne time on a business day, the unit price used for the withdrawal will generally be that applicable at the close of business that day. That is, the unit price used will not be that available at the time the Trustee receives and validates your request.

On or after 3:00pm, it will be processed on the next business day.

A business day is any day, other than a Saturday or Sunday, on which banks are open for business in Melbourne. Where there are insufficient funds to meet the request in the Trust’s bank account, we will take appropriate actions (for example, redeem investments) to create sufficient funds. In such cases we reserve the right to process the withdrawal using the unit price applying at a later date where it would otherwise prejudice the interests of other investors.

Switching between Investment Options

Switching between Investment Options is permitted at any time with our approval. A request to withdraw payment from one Investment Option for the purpose of switching to another Investment Option will be treated like a withdrawal and application and, where applicable, a buy/sell spread will apply. You may switch your investment between Investment Options by lodging a completed switching request with the Trustee. The request must specify:


Your account name.

Your postal address and phone number.

The Investment Option(s) that you wish to withdraw your investment from ("exiting option") and the new Investment Option(s) that


you wish to invest in ("entry option").

The dollar amount* that you wish to withdraw from each relevant exiting option.

The dollar amount* that you wish to invest in each relevant entry option.

The request must also include the signatures of appropriately authorised signatories.

*The total amount withdrawn must equal the total amount invested. Any switching of investments between Investment Options will be made in accordance with the terms of the then PDS. You should obtain and read a copy of the current PDS whenever you are making a switching request. Copies of the current PDS can be obtained by calling 1800 512 947. Once completed, the switching request should be sent to us via fax or post. Fax: 1300 365 601 Post: Registry Services


By submitting a switching request in the above manner, you agree and acknowledge that:

You have received, read and agree to be bound by the terms of the then current PDS.

Your personal information will be handled by the Trustee to provide and manage your investment and you consent to your personal information being handled in this manner.

You will be bound by the provisions of the trust deed which governs the operation of the Trust.

Making an in-specie transfer

If you wish to arrange an in-specie transfer of assets from another investment vehicle please write to us with the details or contact us on 1800 512 947.

Information on request

Investors are entitled to inspect the trust deed and copies of certain accounts, annual reports and returns. You can arrange to see these documents during business hours free of charge by lodging a written request with the Trustee.

21 AUGUST 2014 i


Application for a new investment Please use a black pen and BLOCK letters. This application form is part of the Mercer Super Investment Trust Product Disclosure Statement dated 21 August 2014. Fax the completed form to 1300 365 601 or post it to GPO Box 9946 Melbourne Vic 3001. Note: Privacy laws protect your privacy. Please read our Privacy Policy for more information. A copy can be obtained by calling 1800 512 947.

STEP 1 - AMOUNT OF INVESTMENT

Complete amount of investment. The minimum initial investment is generally $500,000. The Trustee may refuse to accept any application at its discretion. I/We wish to invest the following amount in the Mercer Super Investment Trust:

$

Payment of this amount may be made by:

Cheque payable to “NNL ATF Mercer Investments (Australia) Ltd Application Account” and crossed “Not Negotiable”; or

Electronic Funds Transfer, Direct Credit or RTGS directly into the Trust’s bank account. For account details see the ‘Making initial investments’ section of this Product Disclosure Statement.

I/we have previously invested in the Mercer Super Investment Trust: Yes No

STEP 2 - BANKING DETAILS

All investors must provide banking details.

Bank Name: _______________________________________________________________________________

Branch: ___________________________________________________________________________________

Account Name: _____________________________________________________________________________

BSB Number: _____________________________ Account Number: ______________________________

Issued by Mercer Investments (Australia) Limited (MIAL) ABN 66 008 612 397, Australian Financial Services Licence #244385,

as the Trustee of the Mercer Super Investment Trust: GPO Box 9946, Melbourne Vic 3001. Telephone: 03 9623 5555.

MIAL is a wholly owned subsidiary of Mercer (Australia) Pty Ltd (Mercer) ABN 32 005 315 917.

‘MERCER’ is a registered trademark of Mercer (Australia) Pty Ltd.

MERCER SUPER INVESTMENT TRUST APPLICATION FORM

ii 21 AUGUST 2014

STEP 3 - INVESTOR DETAILS

Complete all names, addresses and other personal details.

Name of investing fund:______________________________________________________________________

Name of corporate trustee: ___________________________________________________________________

ABN / ACN __ __- __ __ __ - __ __ __ - __ __ __ ABN Branch Number (if app) __ __ __

Tax File Number OR Exemption code

__ __ __-__ __ __- __ __

__________________________________________________________

Address: _______________________________________________________________________________

____________________________________________________________

Postcode: ________________

Contact name: _________________________________________________________________

Telephone: __ __-__ __ __ __ __ __ __ __ Facsimile: __ __-__ __ __ __ __ __ __ __

Trustee details

Individual trustee 1

Name: ____________________________________________________________________________________

Date of Birth: ______/______/_______

Address: ____________________________________________________________________________

______________________________________________________________________________

Postcode: ________________



Name: ____________________________________________________________________________________

Date of Birth: ______/______/_______

Address: ____________________________________________________________________________

______________________________________________________________________________

Postcode: ________________


21 AUGUST 2014 iii


Name: ____________________________________________________________________________________

Date of Birth: ______/______/_______

Address: ____________________________________________________________________________

______________________________________________________________________________

Postcode: ________________


Contact details Transaction confirmations, monthly statements, periodic statements etc., will generally be sent via email. You can

nominate more than one email address to receive copies of confirmations and statements.

Primary email contact – all correspondence will be sent to the address indicated below:

Email:

Additional email contacts (transaction information only):

Transaction Monthly

Confirmations Statements

Email:

Email:

Email:

Email:

From time to time certain other information may be provided via mail. Please provide a mailing address below.

Name:

Address:

Postcode:



iv 21 AUGUST 2014

STEP 4 - INVESTMENT CHOICE

Nominate the Investment Option(s) in which you wish to invest by writing the percentage or dollar amount to be

invested in each. If you do not make a nomination, or your application is unclear, we will contact you. The total

must equal 100% or the amount specified in Step 2.

I/We wish to invest the above amount in the following Investment Options.

Investment Option $ investment

Single Sector

Mercer Australian Shares

Mercer Australian Shares Plus

Mercer Australian Small Companies

Mercer International Shares

Mercer Hedged International Shares

Mercer International Shares Plus

Mercer Hedged International Shares Plus

Mercer Global Small Companies Shares

Mercer Emerging Markets Shares

Mercer Global Listed Property

Mercer Australian Direct Property

Mercer Global Listed Infrastructure

Mercer Global Unlisted Infrastructure

Mercer Diversified Alternatives Fund

Mercer Australian Sovereign Bond

Mercer Global Sovereign Bond

Mercer Australian Inflation Plus

Mercer Global Credit

Mercer Cash

Diversified

Mercer Diversified Shares

Mercer High Growth

Mercer Growth Plus

Mercer Growth

Mercer Moderate Growth

Mercer Conservative Growth

Mercer Defensive

TOTAL INVESTMENT $

21 AUGUST 2014 v

STEP 5 - AUTHORISED REPRESENTATIVES

You may appoint one or more persons as your authorised representatives to deal with the Trustee concerning your investment in the Mercer Super Investment Trust. By appointing authorised representatives you give the representative’s power, in relation to you investment, to:

Make further investments.

Request a withdrawal of amounts invested and specify how the amount is to be paid.

Request switches between Investment Options.

Receive information as to the balance in your investment account.

Generally act on your behalf in relation to any other matter relating to the administration of the Trust.

If you appoint two or more people to act as your authorised representatives, please indicate whether you authorise the Trustee to act on instructions of any single or any two people you appoint. You may appoint additional representatives or remove existing representatives by giving notice in writing to the Trustee. The Trustee and Mercer as administrator are entitled to reasonably rely and act upon any instruction or information provided by an authorised representative and shall not be liable for any loss or damage of any kind that may arise as a result. Complete this section if authorised representatives are to be appointed. I/We appoint the following person(s) to act as my/our authorised representatives with the powers and on the terms set out above.

Full name: _______________________________________________________

Signature: ___________________

Full name: _______________________________________________________

Signature: ___________________

Full name: _______________________________________________________

Signature: ___________________

I/We authorise the Trustee to act on the instructions of my/our authorised representative(s) listed above and if

more than one, I authorise the Trustee to act on the instructions of:

(tick one box only)

Any single authorised representative*

OR

Any two of those authorised representatives*

*If neither box is ticked, two authorised representatives will be required to sign any future transaction documentation.


vi 21 AUGUST 2014

STEP 6 - INVESTMENT CONSULTANT/FINANCIAL ADVISER DETAILS

Complete the following section if you authorise us to communicate directly with your Consultant/Adviser regarding details of your investment. I/We agree that information relating to my/our investment be supplied to my/our consultant or advisor:

Yes No

Provide copies of all transactions to my/our consultant/adviser. If no election is made, no copies will be sent

Yes No

Consultant / Adviser name: ____________________________________________________________________

Consultant’s / Adviser’s email: __________________________________________________________________

Deal Group: __________________________________ Deal Branch: _________________________________

Phone Number: __________________________________

ABN: ______________________________ Licence Number: _______________________________________

21 AUGUST 2014 vii

STEP 7 - SIGNATORIES

Please complete and sign the Application Form. If the trustees are individuals the Application Form must be signed personally by each of those trustees. If the trustee is a company, the application must be signed (whether executed under seal or not) by: (a) Two directors; (b) A director and company secretary; or (c) For a proprietary company that has a sole director who is also the sole company secretary – that director. Each person must state their capacity (e.g. Director, Secretary or Sole Director or Sole Secretary) after their signature. Before signing this section, please ensure that the MSIT Product Disclosure Statement has been read carefully and that all sections of this application form have been completed (where necessary). An application will not be accepted unless this declaration has been signed. Declarations and Acknowledgments By signing this application form I/We:

Apply to be a member of the Mercer Super Investment Trust (Trust).

Apply to invest in the Trust in the manner specified under Step 3 of this application form.

Acknowledge that I/we have read and understood the MSIT Product Disclosure Statement and agree to be bound by the terms and conditions contained in the MSIT Product Disclosure Statement.

Confirm the information completed on this form is true and correct.

Declare that this application for investment in the Trust is authorised by the governing rules of the investing fund and that the application is made and signed in accordance with those governing rules and that the investing fund is eligible to invest in the Trust.

Agree to advise MIAL if the investing fund ceases to be eligible to invest in the Trust at any time.

Agree to be bound by the provisions of the trust deed which governs the operation of the Trust.

Understand and agree that personal information will be collected and handled by the Trust to provide and manage the investing fund’s investment and I/we consent to the handling of personal information in this manner.

Acknowledge that the value of investments in the Investment Options set out in the MSIT Product Disclosure Statement may rise and fall from time to time and neither MIAL, Mercer, National Australia Bank, nor any of the investment managers guarantees the investment performance, earnings or return of capital invested in any of the Investment Options set out in the MSIT Product Disclosure Statement.

Acknowledge that I/we have provided my/our email address details in this application form or otherwise, MIAL may, at its discretion, use this email address to send information, including audited annual reports, transaction advices, monthly advices and any other form of report or communication by electronic means.

Understand and agree to the conditions of use of the fax instruction service as set out in the Product Disclosure Statement.

Date _______________________

Individual trustees

Name of trustees Signatures

________________________________________ _______________________

________________________________________ _______________________ ________________________________________ _______________________


viii 21 AUGUST 2014

Corporate Trustee

The common seal* of

was affixed in the presence of:

1) Name Date

_____________________________________________ ____________________________________

Signature

__________________________________________________________________________________________

Capacity (e.g., Director/Secretary, sole Director and sole Secretary)

__________________________________________________________________________________________

2) Name Date

____________________________________________ ____________________________________

Signature

__________________________________________________________________________________________

Capacity (e.g. Director/Secretary, sole Director and sole Secretary)

__________________________________________________________________________________________

* Corporate Trustee applications must be signed (whether executed under seal or not) by:

(a) two directors;

(b) a director and company secretary; or

(c) for a proprietary company that has a sole director who is also the sole company secretary – that director.

Each person must state their capacity for the Application Form to be properly completed.

For office use only Investor number Date received Acceptance by the Trustee

_________________________ __________________________ ________________________________

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