03 / Method
How the proportion is calculated
For unsegregated assets across the income year, including accumulation-only periods, the calculation divides average retirement pension liabilities by average total superannuation liabilities. Transaction dates change the result. Opening balances alone are not enough.
The formula
Exempt proportion = average retirement pension liabilities ÷ average total superannuation liabilities × 100. The numerator and denominator must cover the same periods.
Daily weighting
Keep a balance for each relevant account on each date, apply the recorded transactions, and add up the daily balances. Divide by the number of included days to get the average. The preliminary calculation treats a transaction as taking effect at the start of its date.
Treated separately
Segregated periods are treated separately. Non-retirement interests are not retirement pension liabilities. Reserves, contingent benefits and defined-benefit pensions need actuarial treatment. Never treat them as ordinary account-based pensions.
The preliminary calculation uses a fixed crediting-rate assumption and reconciles implied investment income separately. A qualified actuary must review the data, assumptions and applicable standards before issuing a certificate.
Checklist
- Compare the period schedule with the fund’s history.
- Check both liability averages and the final percentage.
- Recalculate after any material input changes.
Further reading: Professional Standard 406