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Industry standards launch

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Media Release 21 July 1999 Embargo till noon Wed, 21 July 99

Industry Standards Launch The Investment and Financial Services Association today launched a Code of Ethics and a range of Practice Standards and Guidance Notes for its members. Currently, more than nine million Australians invest or insure with IFSA members, and the total underlying funds is more than $450 billion.

IFSA CEO, Lynn Ralph, said; ‘This industry has always taken its responsibility to properly care for their customer’s money and financial futures with the utmost seriousness. We must continue to do all we can to ensure that the conduct of those in the industry is beyond reproach. Only in this way can we rightfully earn the confidence of our customers. ’

‘Self imposed standards are not new to this industry. IFSA is carrying on the work of its predecessor organisations - AIMA, IF A, and LISA - each of which had a range of standards and guidelines in place. IFSA’s ongoing commitment to tough standards reflects our members’ dedication to ensuring the integrity of the industry,’ Ms Ralph concluded.

The Code o f Ethics and Code o f Conduct The Code of Ethics and Code of Conduct sets out a number of fundamental principles, namely that IFSA members should: • act in the interests of their clients and in accordance with good corporate

governance; • observe honesty and sincerity; • avoid conflicts of interest; • maintain confidences unless there is legal or regulatory requirement to do

otherwise; • act in accordance with IFSA standards; • perform duties with competence and due care; and • behave ethically so as to uphold the good reputation of the industry.

The Code of Ethics requires each member company affected by the particular standard to pass an annual resolution stating that to the best of their knowledge they have complied.

Also included is a set of sanctions for any member that breaches the code and/or standards.

Ph: 61 2 9299 3022

Fax: 61 2 9299 3198

Level 24, 44 Market Street, Sydney NSW 2000

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Performance measurement

Performance measurement is one of the key standards IFSA has adopted. Its purpose is to provide a standard method for the calculation and presentation of investment returns. This will fill the void in relation to comparability of performance returns for retail investors. Wholesale investors have been well-served by the now well known AIPS, (developed by the P Group) which is the foundation for this new standard covering retail investments. The retail standard will be progressively implemented so as to allow IFSA members time to complete systems changes.

Takeover Terms for Group Life Cover Guidance Note Another important part of the package is the ‘Group insurance takeover terms guidance note.’ This provides IFSA members with an agreed practice for transfers of life insurance cover for groups of employees in a superannuation fund. The aim is to ensure that claimants never ‘fall between the cracks’ and that their claims are efficiently and speedily resolved.

O ther Standards of interest

Other key standards and guidance notes currently being updated and released are Related Party Transactions, Management Expense Ratios, Scheme Pricing, Valuation of Scheme Assets, Guidelines for Advertising, Investor Reporting, and Financial Reporting.

Additionally, the guidance note on Corporate Governance (otherwise known in the market as the ‘Blue Book’) has been updated to reflect recent changes to the Corporations Law and ASX Listing Rules.

For further information please contact Richard Gilbert on 0417 247 998


Level 24, 44 Market Street, Sydney NSW 2000

___________________ Email:

Ph: 61 2 9299 3022

Fax: 61 2 9299 3198