Corporate expense ratio (MER)
The investment management agreement with KFM provides for the payment of an investment management fee of 0.4% per annum of the value of the portfolio.
Performance is measured by reference to the one year interest swap rate plus 6%. Performance fees are payable at a rate of 15% for outperformance by the investment portfolio above this benchmark. The investment return includes the benefit of franking credits received in the calculation. A highwater mark applies within each 3 year reset period.
The Board estimates the MER for FY2021 will continue to be less than 1%.