Unitisation

Unit pricing – how it works

legalsuper issues unit prices for each of its investment options except for the Direct Investment option (the DIO).

An overview of unit pricing

With unit pricing your interest in legalsuper is measured in a number of ‘units’. Each ‘unit’ has a ‘unit price’.
The value of your interest in legalsuper is equal to the number of units you hold in each of legalsuper’s investment option(s) multiplied by the unit price for that unit in each investment option.

The value of additions and withdrawals from your account are translated into units using the unit price prevailing on the date on which such additions or withdrawals are processed.

What is unitisation?

Each investment option is divided into units.  Each unit has a unit price that is determined by dividing the total value of the assets in the investment option after an allowance for tax and administration fees and other expenses by the number of units on issue for the investment option. Unit prices will increase or decrease as the value of the assets or the allowance for tax and fees in the investment option changes.

Unit prices are determined each week on a Friday. Each week’s new unit prices will generally be available from Wednesday of the following week.
When you invest in any of legalsuper’s investment options (apart from the DIO) you acquire units which constitute your interest in the underlying assets held for the investment option(s) in which you are invested.

Why we use unitisation?

Unitisation provides members up-to-date information about the value of their account balance.

Unit pricing does not apply to investments made in the Direct investment option. Investments in the Direct Investment Option reflect, the value of each investment in the Direct Investment Option.

How does unit pricing work?

Unit prices are generally determined using the available valuation information for assets as at the close of business on each Friday. However, in some instances, the Trustee may determine the value on another day, or more or less often than weekly, or apply a different process to value assets.

A provision for tax, administration fees and expenses will be deducted from the valuation of assets and a net asset value calculated for each investment option.

Each net asset value is then divided by the number of units on issue for each investment option (except the DIO). An allowance will also be made for the cost of acquiring and disposing of the assets in each investment option.  This is known as a “buy spread” and a “sell spread” and is used to help ensure equity between members buying or selling units in an investment option with legalsuper and those who continue to hold the investments option in legalsuper.

legalsuper will ordinarily release unit prices by Wednesday of the following week on its website at legalsuper.com.au.

When a contribution is allocated to your account, members are allocated a number of units. The number of units allocated will be determined by dividing the contribution amount by the relevant buy unit price.  When you sell units either to make an investment switch, receive a pension payment or to withdraw money from legalsuper, the amount you will receive is the number of units that you sell times the sell unit price.

Example:
David Smith
Contribution for May 2013 = $1,100
Buy unit price = $1.10 per unit
Number of units allocated = 1,000 units ($1,100/$1.10)

When a benefit payment or other withdrawal (such as for some administration fees, insurance fee, pension payment or at your request) is deducted from your account, units are deducted from your account using the relevant sell unit price.

Example:
David Smith
Withdrawal = $1,100
Sell Unit price = $1.09 per unit
Number of units sold = 1,009.1 units ($1,100/$1.09)

How long will it take to process if I switch from one investment option to another?

When a member requests a switch between investment options (except the DIO), a pension payment or a benefit payment, the transaction is processed using the next unit price that is issued the week after the switch is received.

In other words, a switch received on Thursday this week will be processed from Wednesday next week after the next unit price has been issued.

How regularly are unit prices updated?

legalsuper will usually issue unit prices weekly, generally by Wednesday of the following week, and these prices are available at legalsuper.com.au

What if unit prices cannot be determined?

If the Trustee is unable to value or liquidate significant assets the Trust Deed includes a power for the Trustee to suspend investment into, or out of, an investment option and the ability for members to buy or sell units could be suspended.

Different prices for Accumulation and Pension members

There are different unit prices for equivalent investment options in the accumulation and pension sections of legalsuper. This is because earnings in the accumulation section of legalsuper are subject to tax and legalsuper needs to accrue for this tax (as well as other expenses) when unit prices are calculated. For the Pension section, earnings on these assets are not currently taxable. 

How can I check the value of my account?

You can check the value of your account online by logging into Member Login using your account logon details. You will be able to see the number of units you hold in each of legalsuper’s investment options, the current price per unit and the total value of your investment in dollar terms.

Remember that unit prices change regularly and you should periodically check to see if all your recent transactions have been received and processed.

Alternatively, you can call us on 1800 060 312 and we can assist you with your account balance.

Further questions?

For any questions you may have please call 1800 060 312.

Important note

This information is of a general nature and does not take into account your specific needs. You should consider your own financial position, objectives and requirements before making any financial decisions. You should also obtain and read the legalsuper Product Disclosure Statement (PDS) before making your investment decision. Past performance is not a reliable indicator of future performance.