26 May 2022

Financial Markets Conduct (KiwiSaver Confirmation Information) Methodology Notice 2022

Financial Markets Conduct (KiwiSaver Confirmation Information) Methodology Notice 2022: This notice replaces the Financial Markets Conduct (KiwiSaver Confirmation Information) Methodology Notice 2017 with no amendments other than it no longer has an expiry date.  It prescribes the method that KiwiSaver providers must use to calculate the total fees paid by each investor for disclosure in annual confirmation information.  The methodology notice will help KiwiSaver providers attribute fees charged at the fund level (including underlying fund charges) to each investor.  KiwiSaver providers are not required to use the methodology if they can calculate the actual fees charged to each investor for the relevant period.  KiwiSaver providers can choose whether to allocate fees charged at the fund level for the accounting period to investors using either the investor’s average balance (total annual fund charges calculation) or using the investor’s balance as at the date the units of the fund are valued (cents per unit calculation).  The method of calculation must be published on a website maintained by or on behalf of the manager of the scheme.

Our preference is for KiwiSaver scheme providers to use the cents per unit calculation, given that method provides a more accurate and therefore more meaningful fees figure for investors, and we encourage providers to change to the CPU methodology at a suitable time.

The notice does not have an expiry date, however, we plan to schedule a review of the methodology within a five year timeframe