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Frequently Asked Questions
What Is The Tax
Position When Investing In Djerriwarrh?
One of the Company’s key objectives is to pay shareholders
an enhanced level of dividends. Since the introduction of the system of imputation
all of Djerriwarrh’s dividends to date have been fully franked,
potentially enabling shareholders to offset the franking credits
received against their own income. Recent changes to the imputation
system also allow refund of franking credits to shareholders whose
marginal tax rate is less than the Company tax rate.
Further, since Djerriwarrh meets the definition of a Listed Investment
Company for tax purposes, it is also able to pass through to shareholders
tax benefits in respect of capital gains which the Company makes
on securities held more than one year. The effect of these tax benefits
is to put the shareholder in the same position as if they had sold
these assets personally so that half of the capital gain would be
tax free.
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What Is
The Role Of The Board?
The role of the Board of Directors is to set goals and policies
for the operation of the Company, to oversee the Company’s
management, to regularly review performance and to generally monitor
the Company’s affairs in the best interests of its shareholders.
For these responsibilities, the Board is accountable to its shareholders.
The Company's primary activity is focussed and straightforward,
accordingly, the Board has adopted a simple structure to conduct
its operations. First, directors have an involvement in the investment
decisions of the Company through the Board Investment Committee.
The Board has also outsourced administrative and management functions
to Australian Investment Company Services (AICS), the Company's associated entity. AICS staff take responsibility for administering
the Company's affairs in conformity with the Boards goals and policies.
AICS is paid a fee based on their costs in providing these services.
The Board supervises
the Company to meet its primary performance aims:
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to pay
an enhanced level of dividends which; and |
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to provide attractive
total returns over the medium to long term. |
The Board comprises a Chairman, Managing Director and five other
non-executive directors, all of whom have a personal financial interest
in the Company. Four of the five other non-executive directors are
regarded as independent. Details of the skills, experience, expertise
and tenure of the directors are set out in Board
Profiles. The directors meet formally as a Board at least 11 times
per year.
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What Is
The Role Of The Investment Committee?
The Investment Committee comprises six members, B B Teele
(Chairman), R E Barker, PC Barnett, TA Campbell, A F Guy and J Paterson. The Investment
Committee approves all investment orders and transactions, trading
portfolio share and option transactions, reviews the performance of
investments, sets investment policies, reviews sub-underwriting offers
and deals with other portfolio related activities such as voting instructions
and lodgement of proxies. The Committee meets regularly (normally
weekly).
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How Does
The Trading Account Differ From The Investment Account?
Djerriwarrh’s primary objectives are to pay an enhanced level
of dividends and provide shareholders with capital growth over the
medium to long term. The investments which it makes to meet these
objectives are held in the Company’s investment portfolio. However,
we also have a small trading account to enable the Company to take
advantage of short-term opportunities that may arise.
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How Does
Djerriwarrh Make Its Investment Decisions?
The Company’s investment decisions are driven primarily by the
decisions made by the Investment Committee, which usually meets weekly.
A dealing team within Goldman Sachs JBWere in close consultation with
our Chairman and Managing Director undertakes the day to day management
of the Company’s portfolio and associated research with all
transactions subject to review and oversight by the Investment Committee.
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What
Is Djerriwarrh’s Relationship With Goldman Sachs JBWere?
Since the Company was established by JBWere in December 1989 it has
had a close relationship with the firm. In particular it has had considerable
support in terms of research input and availability of resources.
On the other hand, Goldman Sachs JBWere does not control the Company and it does not have a significant shareholding in the Company. Accordingly, the Company is a separate entity and is independent of that firm.
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