CSS 2007-2008 Annual Report to Contributing Members

Welcome 2Planning for life after work 4Be prepared 5Adapt your super strategy to your lifestage 9Make your super work for you 18Member Statement Guide 26Your super details 27Your resignation benefit 29Your age retirement benefit 31Your death and invalidity cover 32Other important information 37Superannuation surcharge 40Things you should know 41CSS contentsReport for the year 42Chairman’s report 42News 44CSS investments 47Financial statements 55Your trustees for 2007/08 56Feedback 57Contact us 58Contents1 | CSS

Planningfor lifeafter workThis section outlines what supermight mean to you at differentages and stages of your life. It offerssome important tips about how toBe prepared, Adapt yoursuper strategy to yourlifestage and Make yoursuper work for you.Be preparedWe all want to be financially comfortableonce we’re no longer working, andknowing when to think about your superis an important step in ensuring you haveadequate funds in place to be able to enjoyyour life after work. Everyone’s livingexpenses and financial goals are different,and you need to consider how you’ll achieveyour desired lifestyle once you retire.We’ve given you a head start by providingsome super strategies for different stagesof your life. We’ve also created a lifestagessection at www.css.gov.au that may giveyou some fresh ideas.The main steps involve deciding how muchmoney you think you’ll need once you’vestopped work, working out what cash flowyou’re likely to have, calculating what cashflow you’re likely to need and thinkingabout how to supplement your savings.1. Work out how much money you’re likely to needMost of us have an idea of when we wantto stop working but we might not knowhow much money we’re going to need toenjoy that phase of our lives. There’s no‘one size fits all’ answer, but theWestpac-ASFA Retirement Living StandardResearch (available atwww.superannuation.asn.au)gives you an indication of how much youmight need. Doing a budget is a great wayto estimate this, especially if you cancompare your budget now with what youthink you’ll need for your life after work.You’ll find a good budget template atwww.understandingmoney.gov.aubut remember that your needs may varydepending on your lifestage and lifestyle.To paint a more accurate personal picture,ask yourself:>>When do I want to retire?>> Where do I want to live onceI’m no longer working?>> If I retire at that time, how long will mysavings need to last? Consider that theaverage life expectancy for a man is78 years and for a woman is 83 years.CSS planning for life after work>>>>>>Will I still have debts to cover?What sort of lifestyle do I want?How much will that lifestyle cost?4 | CSS5 | CSS

2. Calculate what cash flow you’re likely to haveThe next step in putting together a plan isto get an idea of the income from super andother sources that you’re likely to have afteryou stop working. You can:> > use the CSS i-Estimator via Memberservices online at www.css.gov.au>> consider any other ways you may beable to supplement your super, such asinvesting in shares or property.3. Have a look at ways you cansupplement your savingsIf there’s a big difference between howmuch money you think you’re going toneed and how much you’re likely to have,there’s no need to panic. There are a numberof different things you can do to supplementyour savings, to help you bridge the gap.Have a look at:>>your contribution options (see page 18)>> different ways you can top-up your superwith your own money (see page 19)Start your journey with the destination in sightWhen it comes to super, it pays to bedisciplined throughout your working liferather than sprinting at the end of yourworking journey. If you make regularcontributions to your super from thebeginning, and top these up wheneveryou can, you will likely be much better offthan if you try and get yourself over the linein the last few years of your working life.CSS planning for life after work>>different options for claiming your super.You don’t have to take it all at once —you can keep it invested so it continuesto grow (go to www.fido.gov.au foruseful information about yourdifferent options)>> the tax and social security implicationsof your different choices — theCentrelink planning forretirement service is a useful onlineguide to payments, services, programs,publications and forms relating tolife after work. You can access it viawww.css.gov.au in the 55+ lifestage area.6 | CSS7 | CSS

Adapt your superstrategy to your lifestageCSS planning for life after workThere are lots of steps you can take to make the most ofyour super journey. We’re keen to make sure you havethe information you need to make important decisionsabout your super. Depending on your lifestage, you maywant to plan, prepare, step-up or arrive.8 | CSS9 | CSS

PlanTake thefirst step onyour superjourney.Help your familyto planWe teach our kids many essential life skills.But can we help them become financiallyresponsible and ultimately independent?As every parent knows, kids learn as muchfrom what we do as from what we say.Set a good exampleAs a first step, try to make sure you lead byexample with your money managementpractices. Also, think about:>> establishing jobs (outside ofhousehold chores) that can earnthem pocket money>> encouraging them to set money asidefrom their pocket money to save forsomething they really want>> setting up a bank or credit unionaccount for them so they can watchtheir savings grow over time, and learnabout interest>> for teenagers, starting to pay pocketmoney fortnightly or even monthly sothey learn how to budget.Introduce your kids to superIf your kids are working, and will earnless than $58,980 in 2007/08 ($60,342 in2008/09), they’re probably eligible for thesuper co-contribution. Encourage them toput $1 of their own money into super andthen the government may put in as muchas another $1.50* (up to a maximum of$1,500 per year). It’s as easy as making a bankdeposit — see page 22 for more information.Another important point to make with yourkids once they start investing in super isthat they need to keep track of their superespecially when they change jobs. It makesthings much simpler if they roll their superinto one account and it can also make a bigdifference to how much money they’ll haveby the time they want to claim their super.Take the next stepFor more handy financial information foryour family, go to the lifestage section atwww.css.gov.au* Subject to eligibility requirementsand caps — see page 22 for full details.CSS planning for life after work10 | CSS11 | CSS

26–44 45–55 55+Stay focusedon whereyou’reheading.Are you aged 26-44?The next stepis to prepareAre you finding it hard to makesuperannuation a priority among all yourother commitments to your job, relationshipor family? You’re not alone.You’ve started out on your super journey, butnow is a good time to make sure it’s workingfor you and taking you where you want togo. At this stage of your life, you need to startpreparing for your life after work even asyou’re climbing the corporate ladder.Here are some tips to help you take the nextstep on your super journey:>> Check your eligibility for superco-contributions. For every dollaryou put into your super, the AustralianGovernment will contribute up to$1.50* (to a maximum of $1,500), whichcan make a huge difference to yourfinal super figure by the time you stopworking. The super co-contributionamount reduces by five cents for every$1,000 you earned over $28,980 in2007/08 ($30,342 in 2008/09) (see page 22for more information).>> Start thinking about when you want to retire so you can decide onthe best strategy and the most favourableinvestment options for your super in thetimeframe you’ve got (see page 51 formore information).> > Monitor your progress and makesure your super is heading in the rightdirection. To work out how muchmoney you’re likely to have by the timeyou stop work, use the CSS i-Estimatorvia Member services online atwww.css.gov.auTake the next stepFor more about the CSS in general — visitwww.css.gov.auFor more information about super strategiesthat are right for your stage of the journey,see our lifestage section at www.css.gov.au* Subject to eligibility requirementsand caps — see page 22 for full details.CSS planning for life after workPrepare12 | CSS13 | CSS

26–44 45–55 55+Take the rightroad and stayon track.Step-upAre you aged 45-55?It’s time to step-upBy this stage of your life, life after workis becoming much more of a realityand you’re keen to make sure you’ll befinancially comfortable once you stopworking. With your career established andmaybe less financial responsibility, you mayhave a larger disposable income. This is thetime to review your living expenses andtop-up your super savings if you need to.>> Start thinking about when youwant to retire so you can decideon the best strategy and the mostfavourable investment options for yoursuper in the timeframe you’ve got (seepage 51 for more information).>> Decide how you want to claimyour super, whether you can andshould take it as a pension or a lump sumor a combination of both. Check outour website and get some advice froma financial adviser to make sure you’veconsidered all your options.> > Monitor your progress and makesure your super is heading in the rightdirection. To work out how muchmoney you’re likely to have by thetime you stop work, use the CSSi-Estimator via Member servicesonline at www.css.gov.au If youdon’t think your current strategy isgoing to give you the lifestyle you wantonce you’re no longer working, thinkabout making some changes now.Take the next stepFind out more about the CSS in general —visit www.css.gov.auIf you’d like more information about superstrategies that are right for your stage ofthe journey, visit the lifestage section atwww.css.gov.auCSS planning for life after work14 | CSS15 | CSS

Arrive26–44 45–55 55+It’s not only thejourney – it’s thedestination too.Are you aged 55+?Get ready to arriveNow you’re nearing the end of yourworking life and getting close to beginningyour life after work. That doesn’t meanit’s too late to adapt your strategy andinvestment options to your timeframe andtop-up your super if you need to. Also, youneed to think about the best way to claimyour super so you can continue to live inthe way you’re used to.>> Start thinking about when youwant to retire so you can decideon the best strategy and the mostfavourable investment options for yoursuper in the timeframe you’ve got (seepage 51 for more information).>> Think about making additionalcontributions. You might have moredisposable income right now and addingit to your super will give it an extra boost(see page 19 for more information).>> Take a look at how your super isinvested and decide whether you wantto opt for the Cash Investment Option(giving you greater surety of earningsfor your member and productivitycomponents) or the Default Fund (whichwill yield a possibly higher but morevolatile return) (see page 51 for moreinformation).>> Decide how you want to claimyour super, whether you can andshould take it as a pension or a lumpsum, or a combination of both. Checkout our website and get some advicefrom a financial adviser to make sureyou’ve considered all your options.Take the next stepFor more about the CSS in general — visitwww.css.gov.auCSS planning for life after workIf you’d like more information about superstrategies that are right for your stage ofthe journey, see our lifestage section atwww.css.gov.au16 | CSS17 | CSS

Make yoursuper workfor youTo make the most of yoursuper journey, you needto stay informed andcheck regularly whetheryour super is taking youwhere you want to go.How your contributions affect your final benefitYour CSS benefit consists of:>> your basic contributions — the after taxcontributions you pay each fortnight(plus Fund earnings). You can choose tocontribute 5% or nothing at all (0%)>> your supplementary contributions —any additional after tax contributionsyou make on top of your basiccontribution (plus Fund earnings)>> a productivity benefit ‚— a fortnightlycontribution by your employer (plusFund earnings)>> an employer-financed component —a defined amount financed by youremployer, which you receive as aConsumer Priced Index (CPI)-indexedpension when you leave the workforce>> any amounts you’ve transferred fromother super funds (plus Fund earnings)>> any super co-contributions(plus Fund earnings).Decide how much super you want to contributeIf you’re a CSS contributing member, oneof the most important choices you have tomake is the rate at which you’re going tocontribute. For many people, this mostlyaffects the accumulation part of their super,but for some members it will also affectthe pension benefit they’re entitled to.Before you decide to stop contributing, youshould seek professional advice from anexperienced financial adviser.The following table shows how increasingyour supplementary contributions by aslittle as $20, $40 or $100 a fortnight cangive you a whole lot more super whenyou come to claim it. That’s because thatmoney is invested across a range of assetclasses giving you the benefit of diversifiedreturns and compound interest. This tableis an illustration only and should not betaken as a forecast or prediction of anyparticular rate of return. Actual returnsmay differ materially from the figuresused in this illustration.Your supplementaryfortnightly contributionInvestment period10 years 25 years 40 Years$20.00 $6,560 $24,000 $58,240$40.00 $13,120 $48,010 $116,490$100.00 $32,800 $120,020 $291,210Please note: Calculations assume that the extra fortnightly contribution is made continuously throughoutthe investment period and real investment return of 4.5% (CPI + 4.5%) is achieved on the assumption CPIremains at 2.5%. This rate is assumed for the purpose of this illustration only and ARIA does not representthat this return will be achieved.You can change your contribution rateat any time by completing an Election to vary superannuation contributionrate form, available from www.css.gov.auTo find out more about your CSS contributions,visit www.css.gov.au, emailmembers@css.gov.au or call us on1300 000 277.Make small extra contributions andmake a huge differenceSuperannuation is one of the mosttax-effective investments available, becauseinvestment earnings are only taxed at15%. Other investments can attract a muchhigher rate of tax, often 31.5% (includinga Medicare levy) or more. When you lookat this over the long-term and consider thecompound interest earned by that extramoney in superannuation year in, year out,you can see exactly why topping up your supercan be a good strategy.There are several ways you can top-up your super:>> You can supplement your super from after-taxdollars; even a couple of hundred dollars everynow and then can make a huge difference toyour total benefit.>> You can roll your salary sacrifice contributionsyou make to another fund over into yourCSS account at any time (see page 21 for moreinformation).>> If you earned less than $58,980 during the2007/08 financial year ($60,342 for 2008/09),you may be able to take advantage of the superco-contribution and give your savings an addedboost (see page 22 for more information).CSS planning for life after work18 | CSS19 | CSS

How to estimate your benefitYou can estimate your retirement benefitat any time by using the CSS i-Estimator atwww.css.gov.au To access it, you’ll needto log on to Member services onlinewith your personal access number. If youdon’t have an access number, you can callus on 1300 000 277 and we can give you anumber over the phone.If you’re retiring in the next 12 months andwant a detailed benefit estimate, call us on1300 000 277. To find out more aboutyour super and how to top it up, visitwww.css.gov.au, send an email tomembers@css.gov.au or call us on1300 000 277.Check whether you can receive atransition to retirement pensionThe CSS transition to retirement ruleshaven’t changed. However, there are limitedsituations where upon reaching theirminimum retirement age a CSS membercan cease their membership, access theiremployer-financed benefit as a pensionand roll over their lump sum to anothersuperannuation scheme.For more information, see theTransition to retirement fact sheet atwww.css.gov.au and seek professionalfinancial advice.Consolidate your superIf you’ve had more than one job, you mighthave super invested in more than one fund, andyou may be paying additional fees for keepingthat super separately invested. By consolidatingyour super into one account, you may save onmanagement fees. It will also be a lot easier foryou to keep track of your retirement savings, asit’s much easier to keep an eye on one accountthan many different ones.You can only transfer super from other fundsinto the CSS if you’re a contributing member.Transferring is easy — all you need to do is writeto us and let us know that you intend to transferyour super to us. You’ll also need to contact yourother fund(s) and complete their paperwork aswell, to enable the rollover of other super intothe CSS. Once that super is transferred to yourCSS account, we’ll write to you to confirm thatthe transfer has been completed.If you think you have some ‘lost’ super —that is, you have super in other funds, but you’renot sure which ones — you can trackit down by doing free online searches atwww.unclaimedsuper.com.au orwww.ato.gov.au/super using SuperSeeker.CSS planning for life after work20 | CSS21 | CSS

Check whether you’re eligible toreceive a super co-contributionIf you earned less than $58,980 in 2007/08($60,342 in 2008/09), you may be able totake advantage of the super co-contribution.If you’re eligible, for every dollar you putinto your super after tax, the AustralianGovernment will contribute up to $1.50 (to amaximum of $1,500). This can make a hugedifference to your final super figure by thetime you stop working. The superco-contribution amount reduces by fivecents for every $1,000 you earned over$28,980 in 2007/08 ($30,342 in 2008/09).To take advantage of the superco-contribution, you need to:>> make a personal, after-tax contributionto your super (such as your standard 5%contributions)>> receive 10% or more of your totalincome from eligible employment>> not hold an eligible temporary residentvisa at any time during the year>> lodge an income tax return for theincome year>>be less than 71 years old at the end of theOnce you’ve lodged your tax return withthe Australian Taxation Office (ATO), theinformation you’ve provided will be usedto check your eligibility. The ATO willcalculate the amount of your superco-contribution and then deposit it directlyinto your CSS super account. You don’tneed to do anything — it will happenautomatically once you’ve lodged yourtax return.The following table shows how much youcan expect* to receive based on your totalincome, which is your assessable incomeplus any reportable fringe benefits, and anafter-tax contribution of $1,000, $800, $500or $200.In the year 2008/09 if your personal superannuation contribution (after-tax) is:And your income is:$1,000 $800 $500 $200Your super co-contribution will be:$30,342 $1,500 $1,200 $750 $300$32,342 $1,400 $1,200 $750 $300$34,342 $1,300 $1,200 $750 $300$36,342 $1,200 $1,200 $750 $300$38,342 $1,100 $1,100 $750 $300$40,342 $1,000 $1,000 $750 $300$42,342 $900 $900 $750 $300$44,342 $800 $800 $750 $300$46,342 $700 $700 $700 $300$48,342 $600 $600 $600 $300$50,342 $500 $500 $500 $300$52,342 $400 $400 $400 $300$54,342 $300 $300 $300 $300$56,342 $200 $200 $200 $200$58,342 $100 $100 $100 $100$60,342 $0 $0 $0 $0CSS planning for life after workincome year.* Provided you are eligible, eligibility for the super co-contribution is determined by the Australian TaxationOffice, based on the tax return you submit.To find out more about how the super co-contribution works, visit www.css.gov.au, emailmembers@css.gov.au or call 1300 000 277. Alternatively, check out the ATO’s website atwww.ato.gov.au/super where you’ll also find a handy calculator.22 | CSS23 | CSS

Get up-to-date with the latest changesTwo changes introduced by thegovernment came into effect duringthe year. These were:>> early access to benefits for contributingmembers>>changes to member contributions.Early access to benefits forcontributing membersFrom 1 January 2008 some members maybe able to access a part of their CSS benefitearly. This is allowed on the grounds ofsevere financial hardship or for otherspecified reasons, or may be grantedunder a determination made bythe Australian Prudential RegulationAuthority (APRA).To access your benefits early for financialhardship reasons, you must meet theeligibility requirements and provide theapplication and relevant documentationto us. We’ll assess your application againstthe relevant guidelines and determinehow much of your superannuation will bereleased. The amount released can’t be morethan $10,000 gross, and only one paymentcan be approved in any 12-month period.If you don’t meet the requirements forfinancial hardship, you can apply to APRA toapprove the release of benefits on specifiedgrounds (such as to meet the cost of medicalexpenses or mortgage repayments, to preventthe loss of your home).You need to realise that your early releaseamount (plus Fund earnings, whether theyare positive or negative) will be deductedfrom your account when your finalbenefit is paid.Please note that if you’re a number of yearsaway from retirement, the amount of yourearly release could significantly reduceyour final benefit from the CSS and yourassociated pension.For more information about early accessto superannuation benefits, visitwww.css.gov.auMember contributionsFrom 1 July 2008 you can choose tocontribute 5% of your after-tax salary asyour basic contribution or you can choosenot to make any after-tax contributions atall (0%). You can change your contributionrate at any time and there’s no upper limiton the amount of after-tax supplementarycontributions you can pay.Because the contribution choices you makemay ultimately affect the size of your finalbenefit, it’s worth exploring what a changein contribution rate could mean for you.You can change your contribution rateat any time by completing a Change my contribution rate form, atwww.css.gov.auIf you decide not to make any changes, yourmember contributions will stay at theircurrent rate.Find out more about your superUnderstanding exactly how your CSS superworks is important. It’s also important toknow when to think about your super, tomake sure you have enough funds for yourlife after work.We’ve given you a head start in this reportabout what you might want to think aboutaccording to your stage in life, and youcan also visit our lifestages section atwww.css.gov.auWe also run free member workshops thatcan help you take the necessary steps alongyour super journey. The workshops runfor around two hours and are suitable formembers of any age. Whether you’re juststarting out or are nearing retirement, we’llhelp you get a better understanding of yoursuper so you can manage it more confidently.The workshops cover all the importantareas, including:>>>>>>>>>>>>getting the most from your supersetting up your super for successunderstanding your optionsgetting information when you need itkeeping your super on tracksetting goals for life after work.Come to a public workshop . . .Our At Work for You workshops willbe visiting a host of different locationsthroughout the year. Go to www.css.gov.auto check the schedule and reserve your seat.. . . or let us bring a workshop to youIf you can’t attend one of our publicworkshops, we can come to you. Askyour employer to send an email toatworkforemployers@aria.gov.au and we’ll contact them to discuss thepossibility of running a workshop atyour workplace.Please note that information provided atthe workshops is not personal advice. Beforeacting on any information provided in theworkshop, we recommend you considerthe appropriateness of the informationin relation to your objectives, financialsituation and needs. You may wish toconsult a licensed financial adviser todo this.Get some financial adviceTalking to a financial adviser can help makethe superannuation journey less daunting.The Financial Planning Association ofAustralia (FPA) offers a number of resourcesto help you find the right adviser for you,tips about what to expect and lots more.Go to www.fpa.asn.au for more details.CSS planning for life after workVisit www.explorecss.com.au toexplore your options.24 | CSS 25 | CSS

Your super detailsMemberStatementGuideThis section shows thevarious componentsof your CSS MemberStatement andexplains how yoursuperannuation wascalculated for 2007/08.It includes some tips tohelp you understandthe CSS and make itwork for you.Your member componentThis represents your personal basic and supplementarycontributions to 30 June 2008 plus allocated interest andany accrued Fund earnings to 30 June 2008.Your productivity component (if applicable)This represents an employer-contributed amount paidfortnightly to 30 June 2008 (less 15% contributionstax on payments made after July 1990). It also includesFund earnings.Super co-contributionsIf you earned less than $58,980 during 2007/08 your after-tax,contributions to your CSS super may entitle you to superco-contributions. If you’re eligible and the ATO has made apayment, it will be shown here. When you claim your CSSbenefit when you stop working, any super co-contributionswill be paid as a lump sum in addition to the benefit youaccrued while you were a CSS member.Please note that any super co-contribution payments inrespect of your contributions during the 2007/08 financialyear may not be received until after 30 June 2008. Superco-contribution payments received after 30 June 2008will be shown in your Member Statement for the reportingperiod in which they are received. The amount of ‘Superco-contributions’ shown in your Member Statement forthe 2007/08 reporting period is the total amount of superco-contributions payments received by the Fund duringthe 2007/08 reporting period (and may relate to after-taxcontributions made during a previous reporting period).Transfer amountsCSS Member Statement GuideAny amounts you’ve transferred from other super funds areshown here. When you claim your CSS benefit, any transferamounts will be paid as a lump sum in addition to thebenefit you accrued while you were a CSS member.Total equityThis is the total value of your equity as at 30 June 2008including your member component, productivitycomponent, super co-contributions, transfer amounts andemployer component.26 | CSS27 | CSS

Your death and invalidity coverAs a CSS contributing member you receiveautomatic permanent invalidity and deathcover at no extra cost. You’re covered fora benefit based on the entitlement youwould have received if you’d worked tothe maximum retirement age(generally age 65).The invalidity and death benefits providedon your Member Statement are the defaultoptions provided by the CSS that arepayable to either you or your dependantsif you (or your dependants) don’t select analternative benefit option.The invalidity and death benefits arereported on your Member Statement at30 June 2008 and might change. Theseamounts have been calculated assumingthat your benefit would not be reducedbecause of the application of a BenefitClassification Certificate (BCC). If you havea BCC, and would like to know the amountthat would be payable on invalidity ordeath, call us on 1300 000 277.The following sections provideadditional information about invalidityand death benefits.In the event of permanentinvalidityIn the event of permanent invalidity youcan choose between the followingbenefit options:Option 1Taking the Maximum Pension Option —this is the value shown on your MemberStatement. This provides you with themaximum pension payable.This includes an employer financed(indexed) standard pension together withan additional (non-indexed) pension.This additional pension is purchasedwith your member component only. Anysupplementary contributions and yourproductivity component (if administeredby ComSuper) will be paid as a lump sum.Option 2Taking an employer financed (indexed)standard pension together with a lumpsum of your member amount and yourproductivity component (if administeredby ComSuper).If you have less than 15 years ofcontributory membership, and the medicalreason for your invalidity retirement isrelated to a condition on your BCC, you alsohave the option of taking your benefit as alump sum only.How is an invalidity benefitcalculated?Generally speaking, invalidity benefits arebased on your prospective membership.This is the total membership you wouldhave achieved if you’d continued workinguntil you were 65 (younger in someoccupations). For members who joined the1922 Pension Scheme or Provident Accountbefore 1 July 1976, you’ll generally receivefull invalidity benefits if you have 20 ormore years of prospective* membership.For members who joined on or after 1 July1976, you’ll generally receive full invaliditybenefits if you have 30 or more years ofprospective membership.However, if your invalidity retirementis related to a condition on your BCC,your benefit will generally be based onyour contributory membership only.This means the service through to yourmaximum retiring age is not included whencalculating your benefit. If you have lessthan 15 years of contributory membership,and the medical reason for your invalidityretirement is related to a condition onyour BCC, you may also have the optionof taking your benefit as a lump sum only.The basis for the calculation of invaliditybenefits is explained on the following page.CSS Member Statement GuideYou can use the CSS i-Estimator to estimateyour invalidity benefit and other benefitoptions at various dates. You’ll need anaccess number to use this service. If youdon’t have an access number, or you’vemisplaced it, call us on 1300 000 277.*Prospective membership is your projected benefitto age 65.For more information about invaliditybenefits, visit www.css.gov.au or call1300 000 277.32 | CSS 33 | CSS

If you were a member of the 1922 Pension Scheme or ProvidentAccount before 1 July 1976CPI-indexed pension (Option 1 and Option 2)If you have 20 or more years of prospectivemembership, and your invalidityretirement is not related to a condition onyour BCC, your CPI-indexed pension will be50% of your final salary forsuperannuation purposes.This percentage is increased if you havemore than 30 years of contributorymembership, up to a maximum of 52.5%for 40 or more years of contributorymembership. This pension may bereduced if you have restricted units orrejected units (these are shown in yourMember Statement).Non-indexed pension (Option 2 only)If you have 20 or more years of prospectivemembership, your non-indexed pensionwill be 20% of your final salary forsuperannuation purposes.If you became a member on orafter 1 July 1976CPI-indexed pension (Option 1 and Option 2)If you have 30 or more years of prospectivemembership, and your invalidityretirement is not related to a condition onyour BCC, your CPI-indexed pension willbe 50% of your final salary. This percentageis increased if you have more than 30years of contributory membership up to amaximum of 52.5% for 40 or more years ofcontributory membership.The CPI-indexed pension percentagedecreases by 1% for each year less than30 years of prospective membership(down to 40% for 20 years of prospectivemembership) and then by a further 2% foreach year less than 20 years of prospectivemembership.Non-indexed pension (Option 2 only)If you have 30 or more years of prospectivemembership, your non-indexed pensionwill be 20% of your final salary. Thenon-indexed pension percentage decreasesby 0.4% for each year less than 30 years ofprospective membership (to 16% for20 years of prospective membership) andthen by a further 0.8% for each year lessthan 20 years of prospective membership.If your invalidity retirement isrelated to a condition on your BCCCPI-indexed pension (Option 1 and Option 2)If your invalidity retirement is related toa condition on your BCC, your benefitsare based on a combination of bothcontributory and prospective membership.For example, if you have less than 20years of contributory membership, butyou have 30 or more years of prospectivemembership, your CPI-indexed pensionof 50% of your final salary is decreased by2.5% for each year less than 20 years ofcontributory membership (for example,47.5% for 19 years of contributorymembership).Non-indexed pension (Option 2 only)This pension is also based on a combinationof both contributory and prospectivemembership. For example, if you have lessthan 20 years of contributory membership,but you have 30 or more years ofprospective membership, yournon-indexed pension of 20% of final salaryis decreased by 1.0% for each year less than20 years of contributory membership (forexample, 19% for 19 years of contributorymembership).In the event of deathIf you die while you’re acontributing memberIf you die while you’re a contributingmember, the maximum pension youreligible spouse will receive will be apercentage of the invalidity pensionyou would have received if you’d retiredon invalidity grounds (see How is aninvalidity benefit calculated?on page 33).The various percentages are shown inthe second column of the table on thefollowing page. The potential invaliditypension would take into account anyreduction in benefits that may apply due toa BCC (see the table on the following page).Your eligible spouse may choose anyof the benefit options that would havebeen available to you if you’d retired forinvalidity reasons. For example, if theydecided to take a CPI-indexed pension and alump sum, they would be paid:>> a pension of 67% of your potentialinvalidity CPI-indexed pension>> 100% of the lump sum that would havebeen payable (that is, a lump sum of yourmember component and productivitycomponents).Other CPI-indexed and non-indexedpension percentages apply if your invalidityretirement is related to a condition onyour BCC and you have less than 30years of prospective membership. Formore information about these pensionpercentages, refer to www.css.gov.au orcall us on 1300 000 277.If you die while you’re receiving a pensionIf you die while you’re receiving a CSSpension, your eligible spouse is entitled toreceive a pension that’s a percentage of thepension being paid to you at the time ofyour death. The percentage payable willdepend on whether you choose the higherdependant pension option when you stopworking. The various pension percentagesare shown in the table on the following page.Higher dependant pension optionIf you retire on the grounds of age orinvoluntary retirement, or claim yourpreserved benefit on age grounds, you canelect to receive a lower pension at that timein return for your spouse and/or childrenreceiving a higher pension when you die(see the table on the following page).You can elect to reduce your pension to93% of the normal pension rate and, inreturn, your eligible spouse and/or childrenwill receive a higher pension when you die(see the table on the following page).This option is not available if you retireon invalidity grounds or if you die whileyou‘re still a contributing or deferredbenefit member.CSS Member Statement Guide34 | CSS 35 | CSS

This table shows the percentage of pension payable where there’s one eligible spouse and up tothree eligible children. These amounts may change if there’s more than one eligible spouse.Calculation of spouse’s pensionNumber of dependentsIf you have no dependantsIf you don’t have any dependants, alump sum of your member component,superannuation guarantee top-up and anyproductivity component will be paid toyour estate following your death.For more information, see ourDeath benefits fact sheet atwww.css.gov.au or call us on1300 000 277.Amount as a percentage of formermember’s standard rate pensionAmount as a percentage of formermember’s reduced rate pension*Spouse only 67% 85%Spouse and one child 78% 97%Spouse and two children 89% 108%Spouse and three children 100% 108%* These percentage rates apply to who a memberwho elects for the higher dependant pensionoption when they retire.Other important informationBenefit Classification CertificateIf you have a BCC, it will be shown here.Are you entitled to full coverbenefits?A BCC lists any pre-existing medicalconditions that might affect your abilityto work to retirement age. If this appliesto you, you would have received a BCCfollowing your medical examinationwhen you first joined the CSS. If you havea BCC and the medical reason for a claimfor invalidity or death benefits is relatedto a condition on your BCC, you or yourdependants may not be eligible to receivefull invalidity or death benefits. In somecases, the benefit is a lump sum only, withno pension options. The BCC will no longerapply if you have 20 years or more of CSScontributory membership.The death and invalidity estimates reportedon your Member Statement are calculatedassuming that BCC restrictions don’t apply.Revoking your BCCIf you have medical proof that you’re ingood health, you can ask ARIA to considerrevoking your BCC or reconsider thedecision to issue the certificate. If you’dlike to discuss this, please call us on1300 000 277.CSS Member Statement GuideNon-disclosure of a medicalconditionIf ARIA believes that you didn’t properlydisclose a pre-existing condition at the timeof your medical examination, you or yourdependants may not receive full invalidityor death benefits. The pre-existing conditionwill be subject to the same considerations asif it had been specified on your BCC.36 | CSS 37 | CSS

Minimum Amount on ExitYou now have a new Minimum Amount onExit (MAE) record. The MAE is the balanceof your account at 30 June 2003 (this isthe last date on which the last allocationto contributing members was made) pluspersonal contributions up to 30 June 2007.For more information about the MAEsee the earning rate policy atwww.css.gov.auPreservation ageDate of birthYour preservation ageSuperannuation law places restrictions onwhen you can access lump sums. One ofthese restrictions is called your preservationage and is in addition to the otherrestrictions on withdrawing your benefit.You generally cannot access your entirebenefit as a cash lump sum until you reachyour preservation age, as shown in thetable below.Preservation ageBefore July 1960 551 July 1960 – 30 June 1961 561 July 1961 – 30 June 1962 571 July 1962 – 30 June 1963 581 July 1963 – 30 June 1964 59After 30 June 1964 60Your SIS Upper LimitThe Superannuation Industry (Supervision)Regulations (SIS) place certain restrictionson the amount of cash lump sum thatcan be paid to members who are notpermanently leaving the workforce, or havenot reached their preservation age.What this means is that if you’re notpermanently retiring from the workforce orhave not reached your preservation age, anycash lump sum paid to you can’t exceedyour SIS Upper Limit. Your SIS Upper Limitis the cash amount you would have receivedif you’d been involuntarily retired (orretrenched) on 1 July 1999.Any CSS lump sum amount that’s higherthan the SIS Upper Limit must be rolledover to a rollover fund.Your preserved benefitcomponent at 30 June 2008Under SIS, these amounts must remainpreserved in the superannuation systemuntil you:>> reach your preservation age and leavethe workforce permanently>> change employers after reaching the ageof 60Your restricted non-preservedbenefit at 30 June 2008Restricted non-preserved benefits arebenefits that can be paid when you stopworking. In the CSS, this amount is yourmember component up to your SISUpper Limit.Your unrestricted non-preservedbenefit at 30 June 2008Under SIS, unrestricted non-preservedbenefits are benefits that can be paid outof a superannuation scheme at any time,subject to Scheme rules.In the CSS, no benefits are payable untilyou cease CSS membership or claimyour preserved benefit. This means yourunrestricted, non-preserved benefit inthe CSS will always be nil while you’re acontributing member.Investment optionThis is the investment option where yoursuper is invested at 30 June 2008. You canchoose how your super is invested. We offertwo options — the Default Fund orCash Investment Option.CSS Member Statement Guide>>reach the age of 65For more information about investmentsvisit www.css.gov.au>>>>diebecome totally and permanentlyincapacitated.38 | CSS39 | CSS

SuperannuationsurchargeThe Australian Government abolished thesuperannuation surcharge from 1 July 2005.However, there are some circumstancesunder which you may still have to pay thesurcharge. For example, if your adjustedtaxable income since 1996 has been higherthan the annual thresholds, or you didn’tprovide your tax file number to the CSS,you may have a surcharge debt in relationto certain employer contributions reportedto the ATO up to and including the 2004/05financial year. The ATO determineswhether you’ve incurred a surcharge debt.If you have, the amount will be shownin the surcharge debt table on yourMember Statement.If you have a surcharge debt, you don’t haveto pay it now — it will be deducted fromyour CSS benefit when it’s paid. Or you canreduce the debt if you want to, by makingpayments. Interest calculated at the10-year Treasury Bond Rate will be appliedto any outstanding balance of yoursurcharge debt account as at 30 June eachyear. If the amount of surcharge reportedon your Member Statement varies fromthe amount you were advised by the ATO,please contact the ATO on 13 10 20.Things youshould knowTransaction SummaryYour Transaction Summary reports:>> any payments that were made by youor on your behalf to the CSS for the2007/08 reporting period>> monthly Fund earnings on your accountand any other amount paid directlyfrom your account>> the management costs and fees payablein respect of your account and any otheramount paid directly from your account>>productivity tax.The other management costs section ofthe Transaction Summary sets out theapproximate amount of management costsdeducted from your investment that werenot paid directly out of your account.How do management costs affectyour benefit?Management costs are not deducted fromyour account, but are reflected in therate of Fund earnings. As a contributingmember, your CPI-indexed pension uponleaving as an age retiree is unaffected byFund earnings (and therefore managementcosts). However, Fund earnings (and themanagement costs that are reflectedin those earnings) will affect thosecomponents of your benefit related tomember and or productivity contributions,super co-contributions and amountsthat you have transferred from anothersuperannuation fund.Additional explanation of feesand costsCSS Member Statement GuideThose costs are calculated by applyingthe fund’s Indirect Cost Ratio (ICR) to theaverage of your account balance over theyear. The ICR is the ratio of the Fund’smanagement costs to the total average netassets of the CSS Fund during 2007/08. CSSFund management costs include fees paidto fund managers, custodian fees and otherinvestment-related expenses. Changes inunderlying management costs can occurduring the year, so the Fund’s ICR maydiffer from year to year.The benefit of any tax deduction isreflected in the investment return and notin the form of reduced fees or costs.Eligible Rollover FundGenerally, if your super becomes payableas a lump sum and we don’t receiveinstructions within 90 days of you stoppingwork about how you’d like your claim paid,it can be paid into an Eligible Rollover Fund(ERF). The ERF selected by ARIA is:AUSfundPO Box 2468Kent Town SA 50711300 361 798Once your benefit is transferred, you mustclaim it from the ERF and you’ll be subjectto the terms and conditions of that fund.40 | CSS41 | CSS

Reportfor theyearThis section containssummary informationfor members aboutthe operation of theCSS during 2007/08,including news,investments,financial statementsand trustees.Chairman’s reportLooking forwardWe are committed to delivering qualityinvestment returns and understanding theriskiness of our environment so thatlong-term the contribution that this Fundmakes to your superannuation outcomeis valuable.In the year ahead, we will continueto review our investment governancearrangements. This will help us to focuson our core business of investment anduphold best practice standards in Trusteeresponsibility and investment beliefs.We will continue to work with ouradministrator, ComSuper, to provideeffective and efficient superannuationservices to our members.Our former trustees’ contributions appreciatedI would like to take this opportunityto thank our former trustees Mr Des Moore,Mr Graham Rogers and Ms Joy Palmer.They each have made valuablecontributions to ARIA over the yearsand their support is appreciated.Welcome to our new Chief Executive OfficerMr Lochiel Crafter was appointed ChiefExecutive Officer of ARIA this year andstarted in May. Lochiel has extensiveexperience in the financial services industryand we welcome him to ARIA and beinga part of our future success.CSS report for the yearDear memberOn behalf of the trustee and themanagement team of the CSS, I am pleasedto present the report for the year ending30 June 2008 and to report to you generallyon the operation of your Scheme.Investment performanceThe CSS Default Fund recorded a return,after taxes, fees and charges of -1.6%, whilethe Cash Investment Option returned6.1%, after taxes, fees and charges. Despitethe 2007/08 results, the CSS Default Fund’slonger-term performance exceeds itslong-term objectives.New trustees appointedThe Minister for Finance and Deregulationappointed three new ARIA trustees inOctober 2007: Ms Margaret Gillespie,Mr Steven Crane and Mr Dennis Trewin AO.Ms Gillespie has been appointed toreplace Ms Joy Palmer, an ACTU-nominatedtrustee who has been with ARIA since1996. Mr Crane replaces Mr Des Moore,a government-nominated trustee, firstappointed in September 2003.Mr Trewin’s appointment started on20 December 2007 at the expiration ofthe appointment of Mr Graham Rogers,a government-nominated trustee firstappointed on 20 December 2004.Thank youI would like to thank our management,staff and valued service providers fortheir dedicated efforts during the yearand in anticipation of their continuingcommitment and enthusiasm for the yearahead. I also wish to acknowledge theMinister for Finance and Deregulationand his department for their supportand hard work during the year.I’m sure you’ll find this report a usefulsource of information, as it containsimportant information about CSSoperations and achievements, and it willhelp you get the most from your super.Yours faithfullySusan DoyleChairman42 | CSS43 | CSS

NewsPerformance in an uncertain marketAfter four consecutive years of strongequity market advances, 2007/08 broke thetrend with both Australian and overseasequity markets recording double digitdeclines. Expectations of a marked slowingin global economic growth and a significantincrease in inflationary pressures stemmingfrom large rises in oil and food prices havecontributed to weakness in globalequity markets.As a consequence of this environment, theCSS Default Fund posted a negative returngiven its significant allocation to equitymarkets. However, performance over thelonger-term remains very strong. In thethree years to June 2008, the CSS DefaultFund achieved a return of 8.2% p.a.,while the figure for the five years endingJune 2008 was 10.4% p.a. These figurescompare favourably with the long-termobjective of the CSS Default Fund.Monthly fund allocation — what it means for youIn 2004 we changed the way we allocateearnings to members’ accounts. This changemeant that we could allocate Fund earningsmore equitably between members whoclaim a benefit and those who stay in theScheme. The allocation reflects the actualperformance of the Fund positiveor otherwise.We have now completed this process andhave moved to monthly allocation ofearnings. To do this, we have allocated thepreviously unallocated Fund earnings tomembers’ accounts.You receive your equitable share of earningswhen you leave the CSS. The changes to themethod of allocating earnings simply meanthat earnings will now be allocated to youraccount monthly, rather than only on exit.A Minimum Amount on Exit (MAE) willapply. The MAE is the balance of youraccount at 30 June 2003 (this is the dateon which the last allocation to continuingmembers was made) plus contributions fromthat date to 30 June 2007. Your MAE will beshown on your 2007/08 Member Statement.For more information see the Fundallocation fact sheet at www.css.gov.auBudget 2007 newsThroughout 2007/08 there were a numberof changes implemented that wereannounced in the 2007 Budget including:>>>>early access to benefitsvoluntary contributions.See page 24 for full details.Budget 2008 — what’s coming up?The Australian Government announcedthat legislation to remove same-sexdiscrimination from a wide range ofCommonwealth laws, including thoserelating to superannuation, would beintroduced in 2008.A Bill to amend the CSS Scheme legislationis currently under review by Parliament. Ifthe Bill becomes law, we will notify you andexplain the details of these changes atthe News area at www.css.gov.auMiscalculation of exit rate for2005/06 — now completeOur review and compliance processidentified issues with accountinginformation used to calculate the DefaultFund exit rates in 2005/06 financialyear. This led to an understatement ofinvestment earnings and a miscalculationof exit rates used for members taking abenefit that year. This error was correctedand new exit rates were posted.We are pleased to report that all affectedmembers have now received additionalbenefit payments that were due includingany interest through to the date of payment.We thank affected members for theirpatience as we worked through this issue.Refreshing our newsletterWe’ve redesigned our quarterly newsletterto make it more informative and easierto read. We’ll continue to bring you thelatest CSS news to keep you informed ofdevelopments that may affect your super,as well as industry-focused news.Improving our workshop booking systemWe’ve upgraded our At Work for Youonline booking system, making it easier formembers to locate super workshops nearthem and to register.The new online booking system presents allupcoming At Work for You workshopsin a user-friendly format. You can bookin immediately, automatically receive aconfirmation email and be notified of anyupdates or changes as they happen.CSS report for the year44 | CSS45 | CSS

What the CSS offersThe CSS is a hybrid scheme: partaccumulation, part defined benefit. Theaccumulation part is the member andproductivity contributions which can bepaid to members as either a lump sum or anon-indexed pension. The defined benefitpart is the employer component, usuallypayable as a CPI-indexed pension. There arearound 33,000 members in the CSS (66% arecontributing and 34% are deferred benefitmembers). For contributing members, theCSS offers:>> a high-value employer benefit well abovethe super guarantee>> no administration fees* (your employerpays this cost)>> the option to contribute supplementarycontributions above the minimum rateof 5%>> the ability to change your contributionrate at any time to suit your financial needs>> automatic death and invalidity cover atno extra cost to you>> a choice between two differentinvestment options — the Default Fundor Cash Investment Option>> a range of flexible retirement options,including a CPI-indexed pension for life>> access to low-cost home loans andbanking services through MembersEquity BankCSS investmentsOur goal is to maximise long-term returnswhile minimising short-term risks.How does investmentperformance affect your benefit?If you’re a contributing member, themember and/or productivity componentsof your benefit are affected by investmentearnings. However, if you leave as anage retiree, your CPI-indexed pension —generally the most significant part of yourbenefit — is not affected by investmentperformance, because it’s determined byyour final salary for super purposes, lengthof membership and age at exit.Any super co-contributions or moneyyou’ve transferred from another fund willbe affected by investment earnings.For more information, see your MemberStatement and your Member StatementGuide starting on page 26.The CSS investment strategy is based onfour key principles:1. Taking a global viewInvesting only in Australia can limitpotential returns. ARIA also searchesfor investment opportunities inboth established and emerginginternational markets.2. Long-term versus short-termIt is important to maintain a balancebetween short- and long-term investment.Our investment strategy is based on along-term outlook rather thanshort-term expectations, but we areaware of the desirability of reducingshort-term volatility.3. DiversificationYour Fund’s investments are spread over allmajor asset classes, a number of investmentmanagers and many investment styles tospread risk.4. Structuring to capture market returnsWhile the overwhelming majority ofyour Fund’s investments are managedby specialist investment managers, thesemanagers generally operate withininvestment constraints designed to ensurethat their returns capture at least most ofthe return delivered by the market inwhich they operate.CSS report for the year>> access to licensed financial advisersthrough State Super Financial Services.*Investment management fees and expenses arededucted before Fund Earning Rates are declared.46 | CSS47 | CSS

Default FundOverview and resultsThe Fund posted a net return, aftertaxes and fees, of -1.6%, its first negativeyear after four consecutive years ofdouble-digit returns.After four consecutive years of strongequity market advances, 2007/08 brokethe trend with both Australian andoverseas equity markets recordingdouble-digit declines. Expectations of amarked slowing in global economic growthand a significant increase in inflationarypressures stemming from large rises inoil and food prices have contributed toweakness in global equity markets.How the Default Fund performed over 10 yearsAs a result of this environment, the Fundposted a negative return given its significantallocation to equity markets. Despite2007/08 results, the Fund’s longer-terminvestment performance remains aheadof its long-term target. Over the past threeyears, the Fund return averaged 8.2% p.a.while over 10 years the Fund returnaveraged 7.5% p.a.Looking to the futureThe CSS is a large superannuation fundby Australian standards, and it will likelycontinue to be for many years yet. However,with Fund outflows from departingmembers now exceeding Fund inflows,we increasingly take account of liquidityconsiderations in framing ourinvestment strategy.ARIA manages the assets of the CSS, PSSand PSSap in a single investment vehicle.This provides greater economies of scale inmanaging the closed CSS Fund and helpsto keep the running cost of the Fund at acompetitive level.Investment objectivesYour Fund’s key investment objective is tomaximise the long-term real return withinsome risk constraints. The investmentenvironment going forward cannot bepredicted, however ARIA is constantlymonitoring its strategic asset allocation andthe global economic environment in whichyour money is invested.Currently, a little over half the Fund’s assetsare invested in equities, with the remainderinvested in bonds, property, cash, marketneutralstrategies (these are investmentswhich are expected to behave differently toequities and bonds, so as to assist us to rideout any short-term volatility in the moretraditional asset classes) and alternativeinvestments, such as private equity.CSS report for the year$120,000$110,000$100,000$90,000$80,000$70,000$60,000$50,00020082007200620052004200320022001200019991998CPIBank BillsCSS PerformanceThe chart above shows how $50,000 invested in the CSS has grown in the Default Fund over the past ten years,compared with how it would have grown if invested in a low-risk asset class like bank bills or cash. Remember, superis a long-term investment and past performance is no indication of future performance — investment markets arevolatile, and it is not possible to predict when they will go up or down, or how quickly this will happen.48 | CSS 49 | CSS

Default Fund assetallocationAt 30 June 07Australian Shares 32.2%International Shares 22.5%Bonds 13.3%Market Neutral 10.1%Long/Short Equities 5.4%At 30 June 08Australian Shares 27.3%International Shares 21.8%Bonds 9.7%Market Neutral 10.5%Long/Short Equities 4.6%Default Fund earning ratesOver the five years ending 30 June 2008, the compound average rate ofearnings (after tax and fees) for the Default Fund is 10.4% per annum.YearEarning rate(after tax and fees)%Inflation rate%2003/04 13.9 2.52004/05 13.9 2.52005/06 13.1 4.02006/07 13.7 2.12007/08 -1.6 4.5CSS report for the yearProperty 13.7%Property 14.9%Cash 2.8%Cash 11.2%Cash Investment OptionDefault Fundperformance 2007/08Total FundReturnHoldingsat 30/6/07$mHoldingsat 30/6/08$mAll performance information is after tax and fees.1 yearperformance% p.a.3 yearperformance% p.a.5 yearperformance% p.a.6,642.5 5,718.2 -1.6 8.2 10.4Overview and resultsThe Cash Investment Option returned 6.1%(unaudited), after tax and fees, in 2007/08.Investment return(after tax and fees)2006/07 2007/085.4% 6.1%Investment strategyThe Cash Investment Option invests in:>>cash (deposits with a bank)>> Australian-dollar-denominated moneymarket securities that are issued orguaranteed by a government, bankor corporate entity with a minimumcredit rating of AA (or its floating rateequivalent), as determined by Standard& Poor’s (or the equivalent from Moody’sor Fitch if no Standard & Poor’s ratingis available)For more information about ourinvestment performance, seeInvestments at www.css.gov.au>>interest rate futures and options tradedon the Sydney Futures Exchange.50 | CSS 51 | CSS

Cash Investment Option asset allocationAt 30 June 07At 30 June 08Cash 100% Cash 100%Cash Investment Option performance 2007/08Our policy on derivativesInvestment managers who enter intoan Investment Management Agreementwith ARIA may use a number of derivativesecurities (known as derivatives) tofacilitate increases or decreases in the fund’sexposure to different investment markets.Derivatives are financial instrumentswhose value changes in response to thechanges in underlying variables. Examplesinclude futures, options and forwardexchange contracts.Derivatives are mainly used to reduce riskfor you. Our investment managers don’tuse derivative securities for gearing theFund or any part of the Fund, or forplacing the fund in a position where it’sshort an asset class.CSS Investment managers 2007/08Default Fund managers452 Capital Pty LimitedAMP Capital Investors LimitedAMP Life LimitedArcadia Funds Management LimitedAXA Rosenberg Investment Management LtdBalanced Equity Management Pty LtdBarclays Global Investors Australia LimitedBlackRock Financial ManagementBrandywine Asset Management LLCBridgewater Associates IncConcord Capital LimitedEureka Funds Management CompanyFiduciary Trust Company InternationalGMO Australia LimitedCSS report for the yearTotal FundReturnHoldingsat 30/6/07$mHoldingsat 30/6/08$mAll performance information is after tax and fees.1 yearperformance% p.a.3 yearperformance% p.a.5 yearperformance% p.a.113.2 320.1 6.1 5.3 –For more information about investment performance, see Investmentsat www.css.gov.auThe investment mandates we grant to ourinvestment managers, allowing them to usederivatives, reflect the policy for the fundas a whole. If ARIA’s investment managersuse derivative securities, ARIA’s internalinvestment team and/or investmentadvisers monitor whether this use isconsistent with ARIA’s policy, and adviseARIA of any breach.If you’d like more information aboutour derivatives policy, call ARIA onHarris Alternatives LLCLend Lease Real Estate Investments LimitedLoomis Sayles & Company LPMacquarie Investment Management LimitedMarathon Asset Management LimitedMarvin & Palmer Associates IncMesirow Advanced Strategies IncMIR Investment Management LimitedOrbis Investment Management LimitedPerpetual InvestmentsCash Investment Option earning ratesFor the period 1 December 2004 to 30 June 2008, the compoundaverage rate of earnings (after tax and fees) for the Cash InvestmentOption is 5.2%02 6263 6999.Platinum Asset ManagementPrincipal Global Investors (Australia) LimitedRexiter Capital Management LimitedRogge Global Partners PLCState Street Global Advisors LimitedYearEarning rate(after tax and fees)%Inflation rate%Templeton Capital Advisors LtdVanguard Investments Australia LimitedWallara Asset Management2004/05 2.7* 2.52005/06 4.9 4.0Wellington International ManagementCompany Pty Ltd2006/07 5.4 2.12007/08 6.1 4.5Cash Investment Option ManagerMacquarie Investment Management Limited* The 2004/05 return numbers reflect performances from December 2004 to June 2005.These are only the investment managers that holdmore than 1% of the Fund.52 | CSS 53 | CSS

Financial statementsThese are the unaudited financial accounts for 2007/08.$ millionValue of Fund as at 1 July 2007 6,797.2InflowsChanges in market value of investments (136.1)Other income 3.2Employee contributions 118.6Employer contributions 41.3Government co-contributions 2.2Appropriation from Consolidated Revenue Fund 2,876.3Outflows 1Benefits paid (3,653.2)Income tax expense (6.2)Value of the Fund as at 30 June 2008 6,043.3Assets and liabilities as at 30 June 2008Investments 2 6,025.5Cash at bank 46.9Amounts to be appropriated from Consolidated Revenue Fund 0.6Other receivables 0.3Benefits payable (22.6)Provision for tax (6.4)Other payables (1.0)Net assets as at 30 June 2008 6,043.31. The expenses of the CSS are met in the ARIA Investments Trust;accordingly no administration or investment expenses appear in thefinancial statements of the CSS.2. The value of investments shown above reconciles with the Total Fundvalues shown on pages 50 and 52 as follows:Default Fund 5,718.2Cash Investment Option 320.1Total Fund 6,038.3Add/(less)Allowance for cost of disposal (12.8)Total 6,025.5CSS report for the yearThe assets of the CSS are invested in the ARIA Investments Trust (AIT), where they’re pooled with theinvestments of the other Commonwealth public sector superannuation funds — the Public Sector SuperannuationScheme (PSS) and the Public Sector Superannuation accumulation plan (PSSap) — in order to deliver a cost-efficientinvestment process. The AIT invests in multiple specialist investment funds and portfolios.The AIT receives income such as dividends, interest, trust distributions and gains and losses on sale, and incursadministration and management expenses, including those expenses otherwise incurred by the CSS.The operating surplus or deficit generated by the AIT is reflected in the daily unit prices published by theAIT to its unitholders, including the CSS, and monthly earning rates based on the unit prices as published on theCSS website. If you’d like to see a copy of the CSS audited financial statements for this year and the reports from theauditor, please refer to our Annual Report to Parliament (published in October) at www.aria.gov.au, send an emailto members@css.gov.au, call us on 1300 000 277 or write to CSS, PO Box 22, Belconnen ACT 2616.54 | CSS55 | CSS

Your trustees for 2007/08Your trustees are appointed to work in the best interests of members, and manage CSSadministration, investment strategy and member communications.Susan DoyleChairman(independent)Appointed Chairman28 July 2003 to 27 July2006, reappointed to27 July 2009Peter FelthamTrustee(ACTU nominated)Appointed 1 July2005, reappointedto 30 June 2009David Connolly AMTrustee(employer nominated)Appointed 19September 2002to 18 September 2005,reappointed to18 September 2008Winsome HallTrustee(ACTU nominated)Appointed 1 July1996, reappointedto 30 September 2008FeedbackIf you have a complaint, you can be sureit will be dealt with as quickly as possible.To register your complaintIf you’re still not satisfiedCSS feedbackDennis Trewin AOTrustee(employer nominated)Appointed20 December 2007 to30 September 2009Margaret Gillespie Trustee(ACTU nominated)Appointed1 October 2007 to30 September 2010Steven Crane Trustee(employer nominated)Appointed1 October 2007 to30 September 2010Joy PalmerTrustee(ACTU nominated)Appointed 1 July 1996,reappointed to30 September 2007We want you to be completely satisfiedwith our service, but if you feel you needto make a complaint, just call us on1300 725 171.If you’re not satisfied with the response,ask to speak to a supervisor. If you still feelthe issue has not been explained or resolvedto your satisfaction, ask to be transferredto the Complaints Officer, or contact themdirect in one of the following ways:Emailcomplaints@css.gov.auPhone02 6272 9081The Superannuation Complaints Tribunalis an independent arbitrator set up by theAustralian Government to resolve members’complaints. For information about thetribunal, visit www.sct.gov.auYou can lodge a complaint with thetribunal free of charge if you’re dissatisfiedwith our response or if we can’t resolve yoursituation within 90 days. You can contactthe tribunal in one of the following ways:Emailinfo@sct.gov.auPhone1300 780 808Des MooreTrustee(employer nominated)Appointed 9 September2003 to 8 September2006, reappointed to30 September 2007Graham RogersTrustee(employer nominated)Appointed20 December 2004to 19 December 2007Fax02 6272 9802PostCSS Complaints OfficerPO Box 22Belconnen ACT 2616Fax03 8635 5588PostSuperannuation Complaints TribunalLocked Bag 3060GPO Melbourne VIC 3001Biographies can be found at www.aria.gov.auDetails of the procedure for trustees’ appointments and terminations are available from our websiteat www.aria.gov.au The trustees manage the CSS in accordance with the law and relevant regulatoryrequirements. All trustees are appointed in writing by the Minister for Finance and Deregulation.ARIA and individual trustees are covered by indemnity insurance to protect themselves and the CSS from lossesarising from claims against them in certain circumstances. To date, there has never been a claim against ARIAor a trustee that has resulted in the loss of members’ monies, nor have any regulatory penalties been imposed.56 | CSS 57 | CSS

Contact usNotesIf you’re making decisions about your super,we can get you off to a good start by givingyou accurate information about the CSS. Visitwww.css.gov.au for convenient access to:>>>>>>>>our Product Disclosure Statementa glossary of termsforms and publicationsnews and information> > free At Work for You workshop dates,locations and booking facility> > Member services online where, with asecure access number, you can:—— use the CSS i-Estimator (our onlinecalculator) to estimate your benefit—— update your address and contact details—— view and download yourMember Statement—— pay surcharge and leave-without-paycontributions via BPAY.If you’ve lost or forgotten your secure accessnumber, you can re-set it in theMember services online login area atwww.css.gov.au If you need help to dothis, call us or send us an email.Emailmembers@css.gov.auPhone1300 000 277TTY02 6272 9827Fax02 6272 9613PostCSS Member ServicesPO Box 22Belconnen ACT 2616For information about your Fund’sinvestments and governance, contactARIA in one of the following ways:Emailsecretary@aria.gov.auPhone02 6263 6999Fax02 6263 6900PostARIAGPO Box 1907Canberra ACT 260158 | CSS59 | CSS

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www.css.gov.auemail: members@css.gov.auphone: 1300 000 27733182 MA@DYour Government Super at Work