2014ANNUALREPORT

Chairperson’s Review2014 will be remembered as the year that the Fund implemented many improvements and default structures following years of research to assist members in various aspects of their financial planning.In March 2014, the Fund introduced the new default life-cycle employer contribution option which allows members to increase their retirement savings incrementally by 1% each year until they reach the maximum contribution rate at age 50. In addition, the Fund’s death benefit was restructured. This was welcomed by members, as it not only offered an increased death benefit but introduced a simpler structure to the previous formula-based benefit structure. Coupled with the launch of the Death Risk Analysis Statement, members were prompted to review their life insurance requirements – an important aspect of financial planning! Where an increase was necessary they were able to obtain additional life insurance via the Media24 voluntary flexible group life assurance scheme at very attractive premiums.

One of the most important focus areas of the trustees is to continue to review the investment strategy of the Fund to ensure that members’ monies are invested appropriately. The Investec share portfolio was terminated during 2014 and the Fund invested in a listed property portfolio for the first time. Sesfikile was appointed as the listed property investment manager and pleasingly delivered a return of 11.5% for the last quarter of 2014. The Fund’s investment portfolios performed in line with their benchmarks and risk profiles with the Growth Portfolio returning 13% p.a. for 2014, which equated to a return of 6% above inflation.

Following a governance review, PricewaterhouseCoopers replaced Deloitte as the Fund’s auditor for the next three years, when the position is expected to be up for review again. I am pleased to advise that the Fund received an unqualified 2014 audit result from the Fund’s new auditor. Furthermore, the actuary has also confirmed that the Fund is in a sound financial position.

I conclude by expressing my sincere appreciation to our principal officer and her team, as well as our various services providers, for their continued hard work and collaboration resulting in the successes achieved. A special word of thanks to my fellow trustees, in particular the member trustees whose term of office recently ended. Thank you for the confidence you placed in me. To the incoming Board of Trustees, I wish you well during your term of office and extend my continued support to you.

Regards

FRAN DU PLESSISChairperson

Management of the FundThe Principal OfficerThe principal officer is responsible for:

- the day-to-day management of the Fund; - ensuring that all statutory requirements are met; - ensuring that the Fund complies with the law; and - carrying out all the decisions taken by the trustees.

The principal officer is also the official contact of the Fund, both for members and regulators, alike.

Alternate trustees are appointed/elected as part of succession planning and may step into the role of trusteeship when a trustee(s) is/are unable to continue being a trustee or when they are unable to fulfil their duties as trustees.

Alternate Member Elected Trustees: (in the order that they will become full trustees, should any trustee be unable to continue their term of office)Mark Herman, Rodney Williams, Ludwig Wolff, Riana Kotze, Therese Pluck

Alternate Employer Appointed Trustees: Lurica Klink, Nelmari Beyers, Raj (O) Lalbahadur

Lynnvan der Merwe

Fran du Plessis

(Chairperson)

GeorgeCoetzee

KarinHofmeyr

HermanWessels

Abduraghman(Manie) Mayman

Member Elected Trustees

Employer Appointed Trustees

NicoGrobbelaar

JohanBotha

IlseMc Carthy

Kelebogile(Lebo)

Lekgetho

EdrichFivaz

The Board of TrusteesThe Fund is managed by a management board known as the Board of Trustees. The Board comprises 10 trustees, 5 of whom are appointed by the employer and 5 who are elected by members of the Fund. Earlier this year in March 2015, a member trustee election was held, following the expiry of the term of office of the previous member trustees.

With effect from 10 April 2015, the Board of Trustees is as follows:

PAGE 1

REGISTRATION NUMBER: 12/8/34554

+27 21 406 3326+27 86 721 3447retfund@media24.com http://www.yourfund.co.za/media24

Naspers Centre, 40 Heerengracht, Cape Town, 8001TFE

PAGE 2

FINANCESTATEMENT OF NET ASSETS ANDFUNDS AS AT 31 DECEMBER 2014

STATEMENT OF NET ASSETS ANDFUNDS AS AT 31 DECEMBER 2014

2014(R)

ASSETS

2013(R)

2 220 328 005Investments 2 146 978 980

44 338 119Transfers receivable 0

4 743 374Accounts receivable 2 712 237

18 153 434Cash at bank 48 969 714

2 287 562 932Total assets 2 198 660 931

FUNDS AND LIABILITIES

2 258 406 296Members’ individualaccounts

2 217 960 354

2 685 324General ReserveAccount

1 837 754Unclaimed benefits

53 212 784Benefits payable

60 254Contributionspayable

12 904 461Accounts payable

2 198 660 931Total fundsand liabilities

ACTIVE MEMBERS

LESS:BENEFITS

PAID (ZAR)

4 724

1 064

At beginning of period

New members

829Withdrawals 186 765 377

11Deaths 9 557 599

70Retirements 154 883 915

20Transfers to other funds 18 515 562

4 858At end of period

6 227 440

3 171 167

18 099 669

33 609

1 624 751

2 287 562 932

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ACTUARIAL VALUATION AS AT 31 DECEMBER 2014

Following the Fund’s annual audit, the Fund’s actuary performed an actuarial valuation of the Fund in order to:

Assess the financial soundness of the Fund

Confirm the balance in the Fund’s General Reserve Account and to make recommendations regarding the allocation of this amount

Make recommendations regarding the allocation of the employercontribution rate between retirement savings, risk benefits and Fund expenses

Comment on the appropriateness of the Fund’s investment strategy relative to the nature and term of the Fund’s liabilities.

● To allocate the amount of R5 446 000 in the General Reserve Account to the fund credits of all active members who were members of the Fund as at 31 December 2014 and who have still been in the Fund at the allocation date of 1 May 2015. The allocation will be in proportion to these members’ pensionable salaries as at 31 Decem-ber 2014 multiplied by the number of months’ membership during the 2014 calendar year.

The Rules of the Fund provide for a portion of the employer contribution, which amounts to 3% of pensionable salary, to be made available for the cost of risk benefits (death, disability and funeral) and general Fund expenses. The table below shows how the 3% was utilised during 2014, as well as the split for 2013 and 2015 alongside it:

*Cost increase due to increase in the death benefit cover from 1 March 2014.** Cost for fund consultants, administrators, actuary, legal, audit, fidelity insurance, FSB levies, etc.

TOTAL ALLOCATION

Cost of risk benefits:Death benefit*Disability benefitFuneral benefitFund expenses**General Reserve Account allocationAdditional retirement savings

3.000%

1.873%1.072%

0.760%0.041%

0.683%0.444%

0%

2014

3.000%

1.409%0.630%0.740%0.039%

0.690%0.301%0.600%

2013

3.000%

1.933%1.072%0.827%0.034%0.681%0.386%

0%

2015

BREAKDOWN OF FUND’S EXPENSES

The valuation results as at 31 December 2014 showed that the Fund was 100% funded and in a healthy financial position. The General Reserve Account had a balance of R5 446 000 to be considered for distribution to members. The actuary also reported that the Fund’s investment strategy was indeed appropriate for a fund of this size and in this financial position. The Board of Trustees, upon the recommendation of the actuary, agreed to the following:

PAGE 3

INVESTMENTSHISTORICAL PERFORMANCE OF THE FUND

ECONOMIC OVERVIEWINTERNATIONAL

LOCAL

The pace of world GDP growth remained restrained and uneven between countries in 2014. While economic recovery continued in the US and the UK, Europe stagnated and Japan faltered. In the US the improvement in the labour market was reflected in meaningfully lower unemployment rates. The US housing market stabilised and recorded a relative improvement from its slump during the recession. Overall, the US economic recovery seems set to continue in 2015. The plunge in oil prices has also been helpful. The decrease not only reflected weak global demand, but also a positive supply shock. It boosted the terms of trade of oil importers and lifted real income growth and spending.

After increasing early in the year, global headline inflation momentum faded sharply towards the end of 2014, partly reflecting the fall in energy prices. Global headline and core consumer price inflation remained low amid modest wage growth, especially in the Euro area where the annual advance in inflation declined outright in the year to December 2014. Too low income growth poses risks, given high government debt levels in a number of countries in the region.

Adverse supply side shocks, including work stoppages and electricity supply disruptions, constrained real economic activity in 2014. Against this unfavourable background, the total gross operating surplus (a proxy for profits) of South African companies increased only 6.6% in the year to Q3 2014. Employment growth was also constrained in 2014 and the decline in personal disposable income growth dampened household expenditure.

The rand remained under pressure against the strong US dollar through 2014. The plunge in oil prices suggested a marked improvement in the country’s terms of trade. Headline consumer price inflation (CPI) peaked at 6.6% in June 2014, before slowing through the second half of the year. The CPI and rand volatility prompted the South African Reserve Bank (SARB) to increase its repo rate by 50 basis points in January 2014 and by a further 25 basis points in July 2014. The magnitude and timing of potential further repo rate increases are uncertain. However, the SARB’s real repo rate remained below its historic average and CPI remains uncomfortably high, relatively close to the upper limit of the SARB’s inflation target range. Hence, the SARB has warned that its policy rate will need to “normalise” over time.

Dec-

00Ju

n-01

Dec-

01Ju

n-02

Dec-

02Ju

n-03

Dec-

03Ju

n-04

Dec-

04Ju

n-05

Dec-

05Ju

n-06

Dec-

06Ju

n-07

Dec-

07Ju

n-08

Dec-

08Ju

n-09

Dec-

09Ju

n-10

Dec-

10Ju

n-11

Dec-

11Ju

n-12

Dec-

12Ju

n-13

Dec-

13Ju

n-14

Dec-

14

700%

600%

500%

400%

300%

200%

100%

0%

Growth BalancedStable Money Market CPI

ASSET CLASS BREAKDOWN AS AT 31 DECEMBER 2014

46%21%

5%6%

22%

Shares 46%Bonds 22%International 21%Cash 6%Property 5%

SHARES 46%

18%Allan GrayCoronation 18%Foord 10%

18%

18%

10%

BONDS 22%

11%Old MutualCoronation 11%

11% 11%

5%

PROPERTY 5%

Sesfikile 5%

CASH 6%

3%SanlamInvestec 3%3% 3%

INTERNATIONAL21%

7%Allan GrayInvestec 7%Foord 7%

7%

7%

7%

PAGE 4

Communication with you, the members of the Fund, remains one of our top priorities. As such we continuously review our communication strategy to ensure that we provide you with meaningful communication that is easily understood and keeps you well informed about the Fund and the options available to you as members. We are extremely grateful for those members who partook in the survey conducted in July last year. This feedback obtained is being incorporated into the Fund’s communication strategy. The strategy for the year ahead will see the Fund’s communication focusing on financial education by way of the introduction of regular financial workshops covering broader items than simply the retirement fund. You would already have seen this in our broad range of financial awareness articles, which we have started distributing to members via the Fund’s website. This year will also see the exciting launch of a brand-new retirement fund e-learning program, which will be piloted within the Novus Holdings Group initially.

We encourage all members to visit the Fund’s website at www.yourfund.co.za/media24 from time to time – all Fund information is kept fresh and up to date for your benefit. We would appreciate members registering at www.AFOnline.co.za as another focus area for the year ahead is to release electronic benefit statements. This means thatmembers will need to be registered on AFOnline to receive their statements via email. It is important for you to keep your beneficiary nomination forms updated, particularly in the event that your dependants have changed. If you have never completed one please do so today!

In the event of a dispute arising, the dispute mechanism set out in the Pension Funds Act of 1956 will apply. A complaint should be made to the principal officer, who is obligated to respond within 30 days.

If you do not receive a response or if you are not satisfied with the response, you can contact the Pension Funds Adjudicator if you wish to lodge a complaint with regard to your Fund. The Adjudicator’s ruling has the same legal effect as a civil judgement.

GENERAL

Previously, the Rules provided for an alternate to be appointed for each appointed and elected trustee. It became extremely difficult to ensure that there would always be five alternate employer and five alternate member trustees, as the alternate member trustees had to step into the role of being a full trustee when member trustees resigned due to leaving the company. The Rules therefore no longer require the Fund to have five appointed and five elected alternates to act in the place of the appointed and elected trustees.

RULE AMENDMENTSRule Amendment No. 5(effective from 1 May 2014)

The wording in the Rules in respect of the term of office for member trustees was amended:

to allow for the member trustee election to be held prior to the end of the term of four years and to reflect that member trustees hold office for a maximum period of four years;

Rule Amendment No. 6(effective from 1 October 2014)

(effective from 1 March 2015)

This report is produced bySimeka Consultants & Actuaries

The Pension Funds Adjudicator can be reached at: Riverwalk Office Park 41 Matroosberg Road Ashlea GardensPO Box 580, Menlyn0063

+27 12 346 1738+27 86 693 7472enquiries@pfa.org.za

TFE

INVESTMENT PERFORMANCE AS AT 31 MARCH 2015PORTFOLIO/INDEX

Balanced

Stable

Money Market

CPI

Growth

1 YEARANNUALISED

13.86%

11.07%

6.35%

4.05%

14.64%

3 YEARSANNUALISED

14.57%

10.75%

5.73%

5.32%

17.17%

5 YEARSANNUALISED

12.60%

9.81%

5.90%

5.22%

14.33%

10 YEARSANNUALISED

12.52%

9.45%

7.38%

6.09%

15.82%

Investment Managers’ Outlookand Strategy Update

Website Investment Page

CLICK ON THESE LINKS TO ACCESS THE FOLLOWING ADDITIONAL INFORMATION » »

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to allow the Fund to accept unclaimed benefits if any future transfers in terms of section 14 of the Pension Funds Act from another fund include unclaimed benefits;

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to change the early retirement age to 55 years, thus no longer allowing members to retire before reaching age 55.

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to allow the Fund to appoint a deputy principal officer, who may be delegated specific duties by the principal officer of the Fund and who will also assume the full role of principal officer in the event of the existing principal officer being unable to carry out his/her duties; and

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