28 J UNE 2009
TO:
FROM:
Academic Money Pur chase Pension Plan Par ticipants
Academic Money Pur chase Pension Committee (AMPPC)
ANNUAL REPORT TO PLAN PARTICIPANTS
Since June of 2008, the Committee has met 8 times for a total of approximately 17 hours. Apart
from the normal oversight duties associated with the operation of the Plan, a principal focus this
year was a search for a new investment manager to replace McLean Budden as one of the active
managers of the Canadian Equity Fund. Following interviews of principals from three short-listed
firms, the Committee recommended that Scheer Rowlatt Associates be appointed as an
investment manager. The Board accepted this recommendation on October 9, 2008. (The
Newsletter of November 28, 2008 provides background information to this recommendation. To
review it, go to http://www.usask.ca/fsd/services-contacts/pensions/ and follow the links to
AMPPC Pension News.)
A second initiative of the Committee was to conduct an annual review and recommend changes
to the Statement of Investment Policies and Procedures to the Board and the Executive of the
USFA for approval. In addition, the USFA members of the Committee recommended changes to
the terms of reference of the Internal Investment Committee to clarify the roles of the AMPPC
and the IIC with respect to pension oversight duties and these recommendations were approved
by the Board. Finally, in response to a proposal from the University, the Committee agreed to the
establishment of education sessions for members of the AMPPC to help ensure that these
members exercise their oversight duties in an informed manner.
As part of the ongoing education and communication strategy, the AMPPC drafted three
newsletters to the membership and partnered with Sun Life Financial to circulate seven
newsletters dealing with financial planning and investment strategies. These newsletters can be
viewed at the abovementioned link.
The AMPPC together with Sun Life organized interactive investment workshops on October 15th
and 16th, 2008 to familiarize members with the principles of building an investment portfolio. In
addition, the Committee arranged for a general meeting on January 28th, 2009 that provided
members with the opportunity to discuss the annual performance of the Plan with our Investment
Consultant representative. Finally, the Committee partnered with Sun Life to hold retirement
planning workshops on February 23rd and 24th, 2009.
Investment Per for mance of the Plan
As Plan members have differing risk preferences, the Plan makes several investment options
available to members. These options allow members to select segregated funds with a mix of
underlying assets that meets their investment needs.
Stock markets around the world declined precipitously in 2008 and this environment made for a
very difficult year for investment returns. Nevertheless, the Life Cycle Funds did provide some
protection relative to their benchmarks. The benchmark portfolios for each of the funds have
been determined using the actual returns of the market indexes such as the S&P/TSX Capped
Composite Index, Standard and Poor’s 500 U. S. Stock Index, Morgan Stanley Europe, Australia
2
and Far East Index, DEX Universe Bond Index and 91-Day Canadian Treasury Bills. The
following is a summary of the Plan’s investment performance as at December 31, 2008 exclusive
of investment expenses:
Fund
Money Market
Return
Benchmark
Bond Fund
Return
Benchmark
Conservative Life Cycle Fund
Return
Benchmark
Balanced Life Cycle Fund
Return
Benchmark
Aggressive Life Cycle Fund
Return
Benchmark
Canadian Equity Fund
Return
Benchmark
U.S Equity Fund
Return
Benchmark
International Equity Fund
Return
Benchmark
1 year
4 year
3.8%
3.3%
3.7%
3.6%
6.1%
6.4%
5.0%
5.1%
-0.7%
-1.2%
3.9%
3.9%
-13.6%
-15.2%
1.4%
1.4%
-19.7%
-21.6%
0.0%
0.1%
-25.5%
-33.0%
3.3%
1.7%
-21.2%
-21.2%
-4.6%
-4.5%
-30.1%
-29.2%
-3.4%
-1.8%
The Sun Life website at https://www.sunnet.sunlife.com/member/signin/index.aspx? contains
additional information about the Plan’s performance. Additionally, you can access the Plan’s
Financial Statements at http://www.usask.ca/fsd/pensions.
Respectively submitted by
Robert F. Lucas, Chair
Academic Money Purchase Pension Committee