The Duties of a Leasing Agent in a Sectional Title Scheme

20 01 2008

Managing a sectional title scheme is not an easy job … however, leasing a property in such a scheme can be even more challenging !!! And when you have “dormant” leasing agents in a scheme you are managing, you could be in for a tough time!

BUT What mainly separates a managing agent from a leasing agent in a sectional title scheme?

I will explain certain aspects by example:

To make an easy distinction, you can remember the following:

(O) – Owner / Leasing Agent   = One area
(M) – Managing Agent    = Many areas

The owner / leasing agent is responsible for all issues relating to his section on the inside (thus the reference to “one area”), whereas the managing agent is responsible for all issues relating to the common property (thus the reference to “many areas”).

Who is responsible for maintenance inside a unit?
A managing agent is responsible for maintaining the common property whereas the leasing agent (on behalf of the owner) is responsible for maintaining the unit on the inside.

Who is responsible for the conduct of tenants/occupants of a sectional title scheme?
It is the responsibility of the owner (or agent) to ensure that their tenants obey the rules of the body corporate, however the managing agent can ensure compliance by enforcing penalties on owners or their tenants.

Who should you report maintenance issues inside your flat, to?
Should a maintenance defect occur on the common property, such defect should be reported to the managing agent of the scheme, for example a leaking tap on the common property. However, should a tap in your bathroom leak, this should be reported to your leasing agent/owner.

Does a leasing agent have the authority to make decisions on your behalf regarding fixtures on common property?

Absolutely not !! Should you want to install a satellite dish, for example, you need to obtain approval from the trustees of the scheme in writing, which is obtained through the managing agent.

[ Information with kind assistance from Omni Estates]

Special Levies – Are they really necessary?

24 10 2007

When in a meeting and you mention the words “Special Levy”, usually all the persons present in the meeting are suddenly awake (if there were dozing off!) and everybody suddenly has a comment to make. The mere mention of raising a special levy usually makes volcanoes of anger erupt!! Owners often blame the raising of a special levy to Trustees not budgeting efficiently or even blame the Managing Agent! In this month’s issue, I will attempt to explain the raising of special levies and the payment thereof.

WHEN IS IT NECESSARY TO RAISE A SPECIAL LEVY? Special Levies are raised when Trustees have to raise an additional levy to cover an unexpected expense, not included in the budget, for example: When a Body Corporate needs to fund the eradication of pests of the complex and this expense was not budgeted for at the previous Annual General Meeting. WHEN DO I HAVE TO PAY THE SPECIAL LEVY?

Levies are usually paid off in instalments of between one to six months, however, the Trustees may determine the period of repayment as they see fit. Usually they grant the owners up to six months to make the payments. Special Levies however, cannot be levied concurrently with ordinary levies over an extended period.


All persons registered as owners on the date the Special Levy was approved and subsequently raised, are liable to pay the said levy, whether an owner has decided to sell his unit and/or a Purchaser has signed an Offer to Purchase. To prevent confusion, it is recommended that a clause be inserted in the Offer to Purchase stating that should the Special Levy be to the benefit of the Purchaser, then the Purchaser should be responsible for payment of the Special Levy.


Firstly, Trustees need to establish whether the expense is in actual fact a necessity and then they should approve the Special Levy in a formal Trustees Meeting. Should it however not be possible to hold a Trustee Meeting timeously, then the additional expense can be approved on a “round-robin” basis, which means that each Trustee should vote on the approval of the urgent expense, accompanied by a full motivation and no discussion or debate is required.


Should the raising of a special levy not be duly authorized and approved, owners can refuse to pay the so-called special levy. Owners should request the Minutes of the Trustees Meeting or even copies of the Round-Robin Resolutions, in which the Special Levy was approved, to ensure the legality thereof.

[ Information kindly provided by Omni Estates]

Amendments concerning divorce orders under Pension Funds Act (PFA) …still a few loose ends…

17 10 2007

In a circular from Liberty attention has been given to the latest amendments to the Pension Funds Act, and especially the effect this might have on payments on divorce cases prior to retirement.

Amendments to the Pension Funds Act now allow a non-member spouse, to whom benefits under their ex-spouse’s retirement fund have been awarded on divorce, to claim those benefits immediately. This means that the non-member spouse no longer needs to wait until the member’s (ex-spouse’s) retirement before the benefits awarded under the divorce order can be implemented.

While this is a positive step towards protection of the non-member spouse, concerns have been raised regarding the process to be followed in paying those divorce benefits to the non-member spouse prior to the member’s retirement. Since the benefit will accrue to the non-member spouse as soon as he/she elects to have it paid, tax should also accrue. Currently, the tax laws have not been sufficiently amended to cater for the issuing of a tax directive in these circumstances.

In addition, the Pension Funds Adjudicator (PFA) has ruled that the relevant sections regarding divorce orders in the Pension Funds Act operates retrospectively. This impacts our various retirement funds, where existing orders have been administratively recorded and will need manual intervention in order to resolve. The tax impact of when the accrual for tax purposes has occurred needs clarity. Again, we are awaiting clarity on the tax implications should the non-member spouse request immediate payment.

Liberty Life has sent a request to the South African Revenue Services regarding the procedure to follow for taxation of the non-member’s benefit. Until such clarification is received, we are unable to process payments on divorce cases prior to retirement.

[ Information from Newsbreak@ Liberty]

What can you expect from your financial advisor?

3 10 2007

FINANCIAL ADVISORMuch has been written about the obligations placed on financial advisors. Despite these bits of awareness created we still find that some advisors still cross the line of professional service and many clients are left in the dark as to what can be expected from their financial advisors.

Salvo Capital has come across a very detailed discussion on this topic by Bruce Cameron. This article appeared in Personal Finance on the 23rd of August – and it simply to important not to share in this Blog!

10 things your financial adviser should do

There’s plenty to celebrate in the new regulations introduced in terms of the Financial Advisory and Intermediary Services (FAIS) Act, which became fully effective on September 30, 2004. The main joy is that, for the first time, you have someone to whom you can turn if your financial adviser does not follow the correct procedures and gives you inappropriate advice.

You can complain to the Ombud for Financial Service Providers, and if your complaint is upheld, he can order that you be compensated.

In serious cases, the Financial Services Board (FSB) can withdraw the license of the offending adviser.

In a nutshell, the FAIS Act requires financial service providers (FSPs) to give you honest and fair advice that is in your interests. And they must give it with due skill, care and diligence.

To this end, advisers must:

1. Give you information about themselves

Within 30 days of appointing an adviser, he/she must give you the following information in writing:

• His/her full name.

• The name of his/her business. The business’s postal and physical addresses, its telephone number/s and internet and email addresses.

• His or her legal and contractual status, such as if he/she is independent or represents a company that supplies financial products.

If your adviser represents a company, you must be told which company, so you know which entity accepts responsibility for the advice you receive.

If your adviser is independent, the company that supplies the product/s you buy on the adviser’s recommendation takes no responsibility for the advice you are given. If you deal with a representative, the product supplier registered as the FSP takes responsibility for the advice.

• Whether or not your adviser has professional indemnity or fidelity insurance cover, in case you want to sue your adviser.

If a FSP has no fidelity insurance and you successfully sue for losses as a result of inappropriate advice, he/she may not have the money to pay you.

2. Tell you if they are registered with the FSB

In terms of the FAIS Act, there are two different types of financial adviser. Any person or organisation that provides you with financial advice is called an FSP. Anyone who provides you with financial advice while working for an FSP is called an FSP representative.

So, for example, if Joe Duggs is an independent financial adviser working on his own, he will be licensed with the FSB as an FSP, while an agent working for one of the big life assurance companies must be registered as an FSP representative. The FSP employing the FSP representative must ensure that all its representatives meet the requirements of the FAIS Act when they give advice and sell financial products.

All FSPs and FSP representatives providing advice must meet “fit and proper requirements”, which include minimum qualifications for providing you with advice and selling you certain products. For example, someone who meets only the minimum qualifications to sell you life assurance may not sell you, or give you advice on, products that are more complex.

At the top end of the advisory scale are discretionary FSPs, who must meet far tougher minimum qualifications before they can accept a mandate from you to make investment decisions on your behalf.

If your adviser is only licensed to sell funeral assurance, for example, you cannot expect him/her to provide proper investment advice. You will need to find another adviser with the appropriate qualifications and licence to give you investment advice.

An FSP must provide you with his/her licence number; an FSP representative must provide you with the licence number of his/her employer. You can check with the FSB whether your adviser is licensed.

3. Understand your financial status

Before giving you any advice, your adviser must get as much information from you about your financial situation, experience with financial products and financial objectives as is necessary for him/her to provide you with appropriate advice.

This includes information about your assets and your debts, your income and expenses, your obligations to dependants, your life and disability assurance and your financial goals, such as the education of children and retirement.

4. Conduct a financial needs analysis

Based on the information obtained from you, your adviser must analyse your financial situation before identifying the financial product/s that are appropriate to your risk profile and financial needs.

Your financial adviser should have a computer program that can assess all your financial needs, from life and disability assurance to retirement needs and investment goals.

If you do not provide all the information your adviser needs to conduct a proper financial needs analysis, or if he/she is unable to carry out a proper analysis for any other reason, your adviser must ensure that you “clearly understand” that:

• A full analysis was not done;

• As a result, there may be limitations on the appropriateness of the advice you have been given; and

• You should take “particular care” to consider whether or not the advice is appropriate considering your objectives, financial situation and needs.

Your adviser must take reasonable steps to ensure you understand the advice you receive and are in a position to make an informed decision.

Your adviser must warn you of any risks you are likely to incur if you decide to ignore his/her advice, take action that differs from his/her recommendations, or decide to accept more limited information or advice than your adviser is able to provide.

5. Give you factually correct and understandable advice

All advice and information given to you by your adviser must be:

• Factually correct;

• Provided in plain language, avoiding uncertainty and confusion, and not be misleading;

• Adequate and appropriate; and

• Provided timeously, giving you the opportunity to make an informed decision about any transaction.

The information must also include details of all costs. Many product suppliers already provide full details of costs so that advisers can pass them on to you, but others, particularly life assurance companies, present them in an incomprehensible way. The costs are often provided as a hodge-podge of fixed rand amounts and various percentages.

Although the FAIS Act does not specifically make provision for this, to ensure you understand the costs and how they will affect your returns, you should insist that costs are provided as a percentage of any investment amount and on what is called a reduced-yield basis. A reduced-yield calculation enables you to compare the amount you will receive when your investment matures in two ways: without the costs deducted and with all the costs, including commissions, deducted.

By getting the costs as both a percentage of the investment amount and on a reduced-yield basis, you ensure your adviser meets the requirement to provide you with information that is understandable.

6. Tell you all about the financial product/service

When your adviser gives you advice about a product, he/she must inform you of all the consequences and implications of buying that particular product. This information includes:

• A general explanation of the nature and material terms of the contract or transaction, disclosing any facts that can be reasonably expected to enable you to make an informed decision.

• Providing you with any illustrations, projections or forecasts about the product’s performance.

You must understand the difference between a projection and a guarantee. Projections of performance, such as those provided by life assurance companies, are very unlikely to be the actual rand amounts you will receive at maturity.

If you are offered a product with guarantees, they must be spelt out explicitly in writing. For example, are the guarantees on the capital or the returns or both? Are the guaranteed returns before or after costs have been deducted?

• Being given all the details about the product you are purchasing. This includes:

* The name, class or type of the product. For example, in the case of a unit trust fund, you should be told the name of the fund and in what sector or sectors the underlying investments are made, and which company provides the product.

* The nature and extent of benefits to be provided, including details of how the benefits will be paid out. For example, in the case of a life assurance policy, you must be told how and when your beneficiaries will receive the money.

The FAIS Act has special stipulations for the advice you must be given when you buy an investment product or a product that has any investment element. These requirements include being given details about:

• How the value of your investment is determined, including concise details of any underlying assets.

• All the charges and fees and, at your request, information about the past performance of the product over periods and at intervals that are reasonable considering the type of product involved. This information should include a warning that past performance does not necessarily indicate future performance.

• The nature and extent of the financial obligations – either directly or indirectly – you have towards the product supplier, including the manner of payment and the consequences of non-compliance.

You must be told about any penalties you could incur if you withdrew from, for example, a life assurance investment. Life assurance investments notoriously come with tough penalties for early termination of a policy, and you can end up getting back less money than you paid in.

• Details of any anticipated or contractual escalations, increases or additions to the investment. For example, you should be told about any automatic increases in recurring premium investments.

• Details of any special terms or conditions, exclusions of liability, waiting periods, loadings, penalties, excesses, restrictions or circumstances in which benefits will not be provided.

• Any guaranteed minimum benefits or other guarantees attached to the product.

• The extent to which the product is readily realisable or how easy it is for you to access the funds you have already invested.

• Any tax consequences.

• Details of cooling-off rights, which give you an opportunity to change your mind about making an investment, and the conditions under which you can exercise these rights.

• Any investment or other risks associated with the product.

However, the Act also places obligations on you. The most important of these is that you provide any information the adviser requires as accurately and completely as possible. This is your responsibility, not that of your adviser.

If your adviser completes or submits any transaction requirement on your behalf, you should be satisfied about its accuracy. Your adviser is not allowed to ask you to sign any written or printed form or document unless all the required details have been completed.

7. Inform you about product providers

When you buy a financial product, your adviser must give you in writing within 30 days:

• The name, physical location, and postal and telephone contact details of the product supplier;

• Details of the contractual relationship (if any) your adviser has with the product supplier, and of his/her contractual relationship/s (if any) with any other supplier/s;

• The names and contact details of the relevant compliance and complaints departments of the product supplier, in case you have any complaints; and

• The existence of any conditions or restrictions imposed on your adviser by the product supplier about the types of financial products or services your adviser may provide.

Your adviser must also tell you if he/she owns more than 10 percent of the product supplier’s shares.

You must also be told whether, during the preceding 12-month period, your adviser (if he/she is a FSP) or the company he/she represents (if he/she is a FSP representative) received more than 30 percent of his/her total remuneration, including commission, from the product supplier.

This information is important because some FSPs, such as bank brokerages, have close relationships with product suppliers, such as life assurers. These FSPs then tend to “push” the products of their associated company, rather than offer you the full range of products.

In addition, the FAIS Act states that your adviser “may not compare different financial products, product suppliers, providers or representatives, unless the differing characteristics of each are made clear, and may not make inaccurate, unfair or unsubstantiated criticisms of any financial product, product supplier, provider or representative”.


8. Inform you of the consequences of replacing financial products

A major problem in the financial services industry is the way many unscrupulous advisers advise people to unnecessarily replace one financial product with another. This is particularly common in the life assurance industry, where, perversely, commissions are paid upfront on recurring premium products, instead of being paid only when you make an investment, as in the unit trust industry. If you replace an existing policy with a new policy, you generate a new set of upfront commissions. Every year, investors lose millions of rands when they switch products.

The FAIS Act stipulates that, where a financial product will wholly or partially replace an existing product, you must be told the actual and potential financial implications, costs and consequences of making the switch. This includes full details of:

• All costs related to the replacement product;

All the special terms and conditions that may apply to the replacement product, including exclusions of liability, waiting periods, loadings, penalties, excesses, restrictions and the circumstances in which benefits will not be provided;

• The impact of age and health changes on the premium, in the case of an insurance product;

• The tax implications of the replacement product and the terminated product;

• Material differences between the investment risks associated with the replacement product and the terminated product;

• Penalties or unrecovered expenses deductible or payable as a result of terminating a product;

• The difference between the products in terms of realising your investment or having access to your money; and

• Any vested rights, minimum guaranteed benefits or other guarantees or benefits that you will lose by terminating a product.


When you replace a long-term insurance contract or policy with any other financial product, your adviser must notify the issuer of the existing insurance policy of the impending termination, so that the issuer can check the advice on which you are basing your decision and also offer you advice.


9. Tell you how they will be paid

Your adviser must disclose details of all earnings he/she receives directly or indirectly from giving you advice or selling you a financial product, including any potential earnings that might lead to a conflict of interest.


One such conflict of interest is the practice of many financial services companies to provide incentives for advisers to sell a particular product, or a number of products, in bulk. For example, FSPs might be offered luxury, all-expenses-paid overseas trips for themselves and their partners if they sell Rx million-worth of the products of a particular company. In other words, you will be encouraged to purchase the product on the basis of the potential reward to the adviser, instead of what is in your best interests.

You must be told precisely the nature, extent and frequency of any incentive, remuneration, consideration, commission, fee or brokerage (“valuable consideration”) that will, or might, become payable to the provider, directly or indirectly.

Although the legislation does not prescribe this, it is in your best interests to discuss at your first meeting with your adviser precisely how he/she will be remunerated. You are entitled to – and should – negotiate commissions and fees. The best route is to negotiate payment based on an hourly rate rather than a percentage of your assets.

Your adviser may not deal in any financial product where the deal is based on advance knowledge of pending transactions on your behalf, or with you or other clients, or on any non-public information that, if disclosed, is likely to affect the price of a product.

10. Give you a record of advice

Your adviser must keep a record of:

• All the advice he/she gives you;

• All the information and material on which the advice was based;

• The financial products that were considered;

• The products that he/she recommended; and

• An explanation of why the products that were selected are likely to satisfy your needs and objectives.

You must be provided with a written copy of the record. The record must be in clear and readable print in terms of size, spacing and format.

It is a criminal offence for your adviser to disclose any confidential information obtained from you without your written consent, unless the information is required in the public interest or under any law.

[Salvo Capital would like to acknowledge and compliment the Author, Bruce Cameron, as well as the publication, Personal Finance, for making available this information to the public.]

Why wait to retire?

26 09 2007

Written by Barbara Germishuis (Certified Financial Planner at Salvo Capital)

In the past, the decision regarding retiring and the tax implications was accompanied by a serious of calculations with very complicated formulas and rules.  A member in a pension fund or retirement annuity was entitled to take one third of his pension in cash on retirement,and this one third was subject to tax, calculated in the following manner:  The time a member spent in the fund was taken into account multiplied by R 4 500, the higher of this amount or R 120 000 represented the tax free portion, the rest was taxed at the members marginal rate.

As from 1 October 2007 the above mentioned rule will no longer apply, it will be a lot less complicated from here on.  The sum of all available pension money will be taxed according to scales in the following way:

Amount representing one third which

Tax rate payable

Will be available to member

0 – R 300 000

0   %

R 300 001 – R 600 000

18 %

R 600 001 – R 900 000

27 %

R 900 001 and above

36 %

The difference between the old and the new rules on retirement can be illustrated by the following examples:

A member of a pension fund has R 1 900 000 in a fund as benefit. He was member of the fund for 34 years, and his marginal rate of tax is 25%. 


Old Tax calculation

New Tax Calculation

(Prior to 1 October 2007)

(after 1 October 2007)

Member benefit

1 900 000,00

Member benefit

1 900 000,00

One third payable on retirement

633 333,33

One third payable on retirement

633 333,33

Tax calculation

Tax Calculation

Membership years to fund


0-R 300 000

0 %

R 300 001 – R 600 000

18 %

34 x R 4 500

153 000,00

R 600 001 – R 900 000

27 %

Higher amount of R 120 000


And R 153 000 will be paid and

Rest tax free

0-R 300 000


R 300 001 – R 600 000

54 000,00

R 633 333,33 – 153 000,00) x

R 600 001 – R 900 000

9 000,00


Tax Paid

120 083,34

Tax Paid

63 000,00

Total cash payable after tax

513 250,00

Total cash payable after tax

570 333,33

Tax Free

153 000,00

Tax free

300 000,00

Benefit after tax

360 250,00

Benefit after tax

270 333,33

The member saved R 57 083,34 in tax by delaying his date of retirement until 1 October 2007.

It is clear that a member to a pension fund / Retirement annuity will save a lot of money [which would have been paid away to tax/ SARS] if the member decided to wait and only retire after 1 October 2007, thereby ending employment only on 31 October 2007.  Please note: If a member decided to give notice on 1 September, the retirement date will only be 30 September and hence, the member will not qualify for the new tax calculation. 

Watch this space for more information on this subject or contact Barbara at

Alarming statistics on pension savings in South Africa

26 06 2007

Johannesburg – A study from Sanlam Employee Benefits (SEB) has revealed a number of notable trends, including a reduction in the average contribution of both South African employers and employees to retirement funds. This comes as the government seeks to increase national savings through a proposed framework of mandatory individual contributions.

The annual retirement survey reveals a need to institute an SA savings culture and the need for more communication about retirement funding.

In the past year, the amount of employee and employer contributions to pension funds has declined by almost a full 1% per annum with the total provision for retirement now at only 11.3% per annum, the study reveals.

While the industry transition from defined benefit to defined contribution retirement schemes has resulted in expanded member choice among funding options, it has also led to an alarming reduction in the total average contribution to retirement.

Negative savings trend

“The expectation is that the government’s multi-faceted social security reform will do much to address South Africa’s negative savings trend,” said Elias Masilela, survey co-author and chief strategist for financial sector developments with SEB.

“However, as the country’s retirement landscape expands, further collaboration among industry, labour and government will be essential to ensure members understand the value and process of saving for retirement.”

“In the current environment, long-term retirement planning has given way to short-term consumption,” said Deon Booysen, survey co-author and executive head of client solutions at SEB. “It seems that employees are opting for more take-home pay rather than maximising their contributions to retirement provision.”

Released as part of the annual SEB symposium the retirement fund industry’s most comprehensive annual survey offers some other revealing statistics, including that 54% of funds now offer members life-stage solutions (up from just 5% in 2004).

As the cost of living increases, more retirement fund members are maximising their exposure to real growth assets to improve their chance of retiring comfortably.

Socially responsible investing not priority

Only 10.5% of retirement funds have a formal investment policy to invest a proportion of assets in socially responsible investment (SRI) portfolios.

Almost 60% of funds are considering paying for financial education of members to address the perceived lack of understanding of the information provided to members.

Masilela said: “Given the social and economic structural backlogs in South Africa’s economy, the level and participation of retirement funds in SRIs remain woefully low.

“The expectation is that with the government’s envisioned national fund there will be the requisite asset base and influence to invest in crucial infrastructure projects in order to drive further economic development and job creation.”

According to Booysen: “Although the majority of funds (93%) provide an annual benefit statement, more resources need to be devoted to educate general staff so that they are able to make responsible investment decisions and better understand all of the benefits available to them and their families.

Online tools are proving increasingly popular though with more than 65% of funds now using an internet/intranet facility to provide members with portfolio information and other fund details.”

The 2007 Sanlam Survey was conducted by the independent market research agency BDRC, by means of face-to-face interviews among 200 principal officers of retirement funds.

[ This information appeared on the website of] 


What is socially responsible investing?

3 06 2007

Definition: Socially responsible investing is the allocation of financial resources, considering both economic and social criteria with the goal of maximising the potential financial and social returns to both the investor and the beneficiary.

According to Sanlam “Socially Responsible Investing” (SRI) has been receiving lots of attention in the global investing scene of late. SRI constitutes $2.29 trillion of the US market. That is nearly one out of every ten dollars under professional management.
The concept might seem strange in a world that revolves around making money. The concept of social returns in addition to economic returns can help us understand the benefits of imposing such a moral attitude to the normal investment decision making process.

Extensive research has been conducted on the economic viability of SRI and results tend to show that it can make financial sense. The reasoning is that sustainability is enhanced by looking beyond profit figures.
The types of SRI include:
• Job creation
• Religious
• Labour relations
• Environmental policies compliance
• Corporate governance
• Exclusion of “sin stocks” (e.g. tobacco, gaming, alcohol, pornography and defence)

There are four ways to incorporate an ethical approach into your investment strategy. They are:
1. Screening excludes certain securities from investment consideration based on social and/or environmental criteria.
2. Divesting is the act of removing stocks from a portfolio based on mainly ethical, non- financial reasons.
3. Shareholder activism efforts attempt to positively influence corporate behavior.
4. Positive investing involves making investments in activities and companies believed to have a high and positive social impact.

In South Africa, positive investing falls strongly in line with the spirit of empowerment financing under the auspices of the Financial Services Charter (FSC). Institutions are encouraged to take part in what are termed targeted investments and BEE financing with the intention to aid in uplifting previously neglected areas of our economy. Even though pension funds are not currently required to adhere to the requirements of the FSC, this might change in the future.

Investment advisors might be advised to investigate the opportunities presented by Socially Responsible Investing. With an increasing awareness of the need for responsible citizenship we can expect a bigger emphasis on responsible corporate behavior in future….

Collective investment schemes, unit trusts and fund of funds …and dangerous investments

3 06 2007

In the aftermath of the Fidentia debacle we thought it would be prudent to discuss the structure of the collective investment scheme and its variations namely the unit trust and fund of funds.

A collective investment scheme is an investment product that enables the investor in the street to pool his funds with other investors and enables them to invest in various securities such as equities, property equities, interest bearing instruments and money market instruments. Various parties are involved in offering, managing and administrating the collective investment scheme. The parties involved consist of the fund, the asset manager, the trustee and the administration company.

The fund consists of the money invested by the investors and the portfolio entails the underlying investments held by the fund. The asset manager is responsible for the management of the fund within the mandate which governs how the manager can manage the portfolio. The trustees ensure that the fund is managed according to the mandate and also act as custodian of the assets. The administration company is responsible for administration of the fund. The functions of management, custodianship and administration are best separated as this greatly reduces the risk of fraud.

To avoid fraud and the risk of losing hard earned money it is advised to follow some basic rules. Before an investment is made – the golden rule should be to do some homework with regards to where the funds are deposited. A simple search on the website of the Financial Services Board [] would provide clarity on whether a specific company is registered as an investment manager. Never deposit any funds in the bank account of a broker – only deposit funds directly into the account of a credit investment manager.

Always remember – if someone invites you to make an investment that sounds too good to be true – it most probably is!!

Introduction to Salvo Capital

18 05 2007

Salvo Capital (Pty)Ltd Salvo Capital (Pty) Ltd is a registered Financial Services Provider (Registration number 8106) as well as an Investment Manager (in terms of SECA, 1985 and FMCA, 1989) at the Financial Services Board.

Salvo Capital (Pty) Ltd acts only as a consultant and will never receive any funds from investors.  All investments are being placed with financial service providers registered with the Financial Services Board.

Salvo Capital is a niche wealth management company catering for the financial needs of high net worth individuals, including entrepreneurs, members of executive management, companies (employers and employees), farmers and retirees.  It is our vision to provide continues financial and investment advice to the above mentioned market. 
The staff of Salvo Capital & Salvo Consulting

Theo Oosthuizen   B.Agric, MBA, CFP
Johan Jonck   B.Iur, LL.B, AFP, IISA Pension Funds
Andre Bouwer   B.Compt, B.Com. Honors (Investment Management)
Barbara Germishuis  M.Com (Economics), CFP
Angelika Griessel  IISA Pension Funds
Maria Noordman    Administration Head 
Anel Joubert   Administration
Anne-Marie Reinhardt  Administration
Services provided by Salvo Capital (Pty) Ltd

Domestic and international investment strategies
Retirement planning
Cash management
Asset management

The services that we provide to our clients comprise the following :

• A financial plan aimed at achieving the objectives of the client.
• Flexibility to accommodate changes in objectives, regulation and market circumstances.
• Objective, independent advice that is not influenced by commission or other incentives.
• Referral of life and medical insurance to a registered life broker.
• Referral of short term insurance to a specialist short term broker.

Services provided by Salvo Consulting (Pty) Ltd
Employee benefits
Asset consulting to Pension and Provident Funds
Outsourcing of Pension and Provident Fund Administration
Providing of independent risk, disability and other benefits.

The services that we provide to our clients comprise the following :
Interpretation of legislation, i.e. of the Retirement Funds Act,  quotations and advice on new and existing pension and provident funds, applying fund rules and regulations, investment strategies and reports, individual investment choices, organise trustee training, member information sessions, group benefits, supplementary benefits, market related rates and fees, co-ordinate monthly payments and schedules, member benefit statements, amendments and additions, maintenance of member data, yearly fund renewals, medicals, claims, advice on options when withdrawing or retiring from the fund, computer system training, general inquiries and administration.

Salvo Consulting services various pension and provident funds underwritten by Old Mutual Orion, Sanlam, SUFA, Liberty, Momentum, MCubed, Discovery, Metropolitan and Safrican.
Financial advice provided by Salvo Capital

The personal and highly confidential service you receive ensures that we keep up to date with your changing circumstances. At the same time it facilitates the building of a relationship with our client.

In the past the financial planning industry was characterized by investment products that were marketed to the public by life insurance and asset management companies. This process was characterized by transaction driven commission.

Salvo Capital (Pty) Ltd rejected this process and restructured the business model in such a way that the interest of the client is foremost.
• All fees are disclosed. There has been a change away from commission based remuneration to fee based remuneration.
• Accreditation :
Our commitment to the acquisition of the CFP (Certified Financial Planner) qualification distinguishes us from our competitors. Salvo Capital (Pty) Ltd is registered as a Financial Services Provider (Registration number 8106) as well as an Investment Manager (in terms of SECA, 1985 and FMCA, 1989) with the Financial Services Board
• Reporting :
Standardized financial advice and reporting is an integral component of our professionalism.
Investment philosophy of Salvo Capital
It is our objective to create wealth for our clients and to protect this wealth against inflation. In order to achieve this we provide advice regarding the following:

• The minimum real return required to achieve your objectives.
• The asset allocation required to deliver the above mentioned real return with the lowest possible risk.
• The implementation of the above mentioned asset allocation.
• How to act responsible during a bull market and a bear market.

Our investment philosophy is based on a structured asset allocation strategy and diversification through the use of various asset management houses.
For further information please contact Salvo Capital at
Tell 051 401 8200 to speak to one of our consultants. 

Salvo Capital
4 Nobel Street
Tell (051) 401 8200 Fax (051) 401 8220

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15 03 2007

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