IOOF  | Annual Report 2012 Two key acquisitions a clear strategic fit Financial Year 2012 results Final dividend of 18 cents  per share paid in October  Corporate governance,  risk control and regulatory  impacts page 7 Dr Roger Sexton , AM Chairman The Group has always had an industry  leading cost management culture, and a very prudent approach to  managing capital and risk on behalf of our shareholders. IOOF has over 160 years of experience in providing financial services and wealth  management products for our customers.  This track record in serving our customers,  coupled with the synergistic, vertically  integrated business model which  underpins the Group, places us in a strong  position to capitalise on future recoveries  in market growth and the increasing flow  of funds to superannuation.  While the global trends in financial  markets have not been in our favour, your  Board has been working to ensure the  long term sustainability of IOOF via the  implementation of action plans within  the three strategic areas outlined above,  ie achievement of budget imperatives,  organic growth and acquisitions. From a corporate governance and oversight  perspective, IOOF operates a common  board structure, meaning that many of  the Directors on IOOF’s main board sit on  each of IOOF’s subsidiary boards. While this  approach increases the responsibility and  workload for individual Directors, it ensures  better oversight and promotes a clearer  understanding of the underlying activities  of each of the subsidiaries. This year, the company has launched a  marketing campaign, designed to improve  awareness of the IOOF brand outside of its  Victorian heritage, and has embarked on  two key strategic acquisitions of financial  advice group, DKN Financial Group and  wealth management firm, Plan B.  The entire organisation is focused on the  future growth and success of IOOF, but not  at the expense of increasing risk beyond  reasonable limits. As such risk minimisation  and a control culture, remains very much  part of the company’s culture. IOOF’s Managing Director, Christopher  Kelaher gives an update on each of these  activities in his overview. Speaking on behalf of your Directors, I would like to take this opportunity to  once again thank IOOF’s former Chairman,  Ian Blair who retired from the Board on  31 March 2012. Ian joined the IOOF Board  as a Non-Executive Director in 2000, prior  to listing, and was appointed Chairman  in 2005. During his association with the  company, Ian played a valuable role in  the growth of IOOF, from a Melbourne  Friendly Society into an ASX top 200 listed  Wealth Management company. At first glance, the financial result for IOOF  is confusing given the statutory result of  $19.4 million is lower than the Underlying  Net Profit After Tax result of $96.4 million. This largely results from recent retrospective  changes in Australian income tax  regulations which required that IOOF  recognise a $63 million deferred tax liability. This liability will not result in a cash  outflow for the group and will unwind  to profit in future periods in line with the  amortisation of the group’s intangible  assets. This entry has no impact on IOOF’s  dividend paying capacity. In February, your Directors were pleased  to declare an interim dividend of 19 cents  which was paid on 4 April 2012 and a final  dividend of 18 cents with a payment date  of 17 October 2012. This takes the total  dividend paid to shareholders, to 37 cents  per share for the year. It is important to note however, that it  is the underlying net profit after tax pre  amortisation which reflects the operational  performance of IOOF. This is also the result  that the Board uses to determine the  dividend paid to shareholders. IOOF has a history of returning  unutilised cash to shareholders and this  is a continuation of this practice. These  dividend payments are at the top end of our stated dividend policy of 60-90%  of Underlying Net Profit After Tax. It would be remiss of me not to  acknowledge the dedication and  efforts of IOOF’s leadership group and  employees over this past year. I would  also like to thank my fellow directors for their ongoing support and fellowship. A reconciliation of Statutory Profit and Underlying Net Profit After Tax can be found on pages 22 and 23 of the Annual Report. Once again, IOOF’s financial result was impacted by external factors such as the state of the global economy and  the flow on effect from stock markets. Financial services is an industry that is, quite rightly, heavily regulated, and regulatory change has been a constant for our industry for many  years. As suggested above, the current  set of regulatory changes ahead of us,  should not impact IOOF in a meaningful  way, simply because many of the  recommendations have been standard  practice for IOOF for quite some time. Notwithstanding these difficult  conditions however, the amount of money which IOOF manages on behalf of its clients improved  marginally this year to $107.3 billion. 