1. Overview of CAP Guidelines for <co. name>
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Overview of CAP Guidelines for <co. name>
This presentation is designed to help you review CAP guidelines with the plan sponsor.
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2. Today’s discussion What is a CAP? CAP roles and responsibilities
Review of CAP Guidelines
How Manulife can help you
Next steps
This session is designed to give you a better understanding of Plan Governance responsibilities for Capital Accumulation Plans in the Canadian group retirement savings market. You’ll also learn how Manulife helps Plan Sponsors fulfill their obligations in this area, and receive tips on how to address governance gaps.
You are required to review your CAP on a regular basis to make sure your practices are meeting the CAP guidelines.
Insert your suggested review timeline, i.e. annual, bi-annual, tri-annual etc.

3. What is a CAP? CAP = Capital Accumulation Plan CAPs include:
Tax-assisted investment or savings plan
Members choose between two or more investment options
CAPs include:
Registered Pension Plan (RPP)
Group Registered Retirement Savings Plan (Group RRSP)
Deferred Profit Sharing Plan (DPSP)
Group Tax-Free Savings Account (TFSA)
First let’s discuss what a Capital Accumulation Plan is.
A Capital Accumulation Plan – or a CAP – is a tax-assisted investment or savings plan that lets members make investment decisions between two or more investment options.
Some examples of a CAP are:
registered pension plans - RPP,
group registered retirement savings plans - RRSP,
deferred profit sharing plans or DPSP, and
tax-free savings account – TFSA.

4. CAP Guidelines: Overview
Intent of Guidelines:
Developed by the Joint Forum of Financial Market Regulators
Outline industry best practices and common standards
Clarify rights and responsibilities of each party (sponsor, member, service provider)
Ensure plan members receive adequate assistance to make investment decisions
Supplement, but not replace, legislated requirements
CAP Guidelines were established to help plan sponsors maintain a Capital Accumulation Plan. These guidelines reflect the expectations of the Joint Forum of Financial Market Regulators regarding the operation of a CAP. They are intended to support the continuous improvement and development of financial services industry practices.
The intent of the CAP guidelines is to:
-Outline and clarify the rights and responsibilities of CAP Sponsors, service providers and CAP members; and
-Ensure CAP members receive the information and assistance they need to make educated investment decisions.
These guidelines apply to all CAPs, in addition to the legal requirements applicable to these plans. They do not replace any legal/legislative requirements, but it is expected that all parties comply with the guidelines.

5. CAP roles and responsibilities
Now, let’s discuss the responsibilities each party has.

6. Responsibilities of Plan Sponsors
Setting up the CAP and defining its purpose
Ensuring the CAP offers a diverse range of investment options
Educating members on investment decisions
Monitoring service provider(s), investment options and funds on ongoing basis
Implementing and documenting administration and record retention guidelines
After deciding to establish a CAP, plan sponsors need to define the CAP’s purpose. The purpose refers to the goals the plan is set up to achieve.
Plan sponsors are responsible for ensuring the CAP offers a wide range of investment options, and for following specific guidelines to choose the funds offered by the plan. They are also responsible for providing members with sufficient information about the funds available to them, as well as the tools they need to make educated investment decisions.
Finally, the sponsor is responsible for monitoring the service providers and investment options on an ongoing basis.
The plan sponsor may also delegate some or all of its CAP governance responsibilities to its service provider.

7. Responsibilities of Plan Sponsors
Plan Members are responsible for:
Making investment decisions within the CAP
Using the information and decision-making tools provided by the Plan Sponsor
Obtaining additional investment advice from a qualified third party (if needed)
Plan members are responsible for making investment decisions within the CAP. There is a variety of member education tools available to plan members through Manulife, including Investment Basics Learning Module (link provided later in this presentation). Plan members are responsible for using those tools to help them make decisions.
In addition, they are responsible for obtaining independent financial advice from qualified professionals if needed.

8. Responsibilities of Plan Sponsors
What is a Service Provider?
Any provider of services or advice involved in the design, establishment and operation of a CAP
Service Providers are responsible for:
Complying with CAP guidelines and any applicable legal requirements delegated by Plan Sponsor to the Service Provider
A service provider includes any provider of services or advice required by the CAP sponsor in the design, establishment and operation of a CAP.
In many cases, the service provider is responsible for following the CAP guidelines and any applicable legal requirements to the extent that the plan sponsor delegated such responsibilities.
The service provider is also responsible for any tasks delegated to them by the plan sponsor.

9. Review of CAP Guidelines

10. CAP Guidelines Six primary guidelines: Setting up a CAP
Investment information and decision-making tools for members
Introducing the CAP to members
Ongoing member communication
Maintaining a CAP
Termination
Now that we know the responsibilities of the sponsor, member and service provider, let’s review the CAP guidelines and the resources Manulife offers to help Plan Sponsors and Plan Members fulfill their requirements.
There are 6 guidelines established for CAP plans. They cover all areas from establishing and maintaining a CAP to terminating it. Lets discuss each of the guidelines in detail.

11. 1. Setting up a CAP To set up a CAP you must:
Define and document the CAP’s purpose
Establish criteria and select a service provider
Choose investment options and funds
Create a policy to address members who do not make investment choices
Define a document retention policy
When you set up a CAP you first should clearly define and document why the plan is being established. This is referred to as the purpose of your CAP. The terms of the plan should be consistent with its purpose and what CAP members are communicated. Some of the purposes for which a sponsor may establish a CAP are:
retirement savings;
Tax-efficient compensation;
profit sharing; and,
savings for other financial goals such as education, home purchases, et cetera.
The decision to change the purpose of the plan – along with the new purpose itself - should be documented. Information on the decision and the impact the decision will have on CAP members should be provided to the members before the decision takes effect.

12. 1. Setting up a CAP
Plan Governance Support Centre provides quick access to the information and tools you need:
Information on guidelines and how
Manulife can help sponsors meet them
Help develop necessary documentation
Create historical record and printable report
Set reminder for next plan review
CAP review checklist
One of Manulife’s primary goals is supporting your efforts to provide good governance. Hosted on the secure plan sponsor website, the online Plan Governance Centre provides a selection of tools and resources that help you maintain records and complete regular reviews.
At the Plan Governance Support Centre you’ll find:
-CAP Guidelines Centre – With details about the Capital Accumulation Plan (CAP) Guidelines. Follow the step-by-step process to develop a CAP report for your plan and ensure you’re managing your plan in accordance with the Guidelines.
-CAPSA Centre (for RPPs only) – Provides details about the Canadian Association of Pension Supervisory Authorities (CAPSA) governance principles, including a questionnaire to help you determine which principles you have already instituted and what steps you can take to improve the governance of your plan.
-Independent audit review of control policies – Issued annually, the Section 5900 audit report provides detailed information about Manulife’s current control methodologies and measurements.
-Compliance statement – Issued annually by Manulife to ensure our standard investments and key areas of operation continue to meet legislative and company standards.
-Tools to help you – Use the sample investment review checklist, code of conduct/conflict of interest policy and retirement knowledge survey, just to name a few, to help you apply good governance principles when managing your plan.

13. 1. Setting up a CAP
Manulife provides these resources and knowledge to help you:
Member education and communication materials
Diverse range of investment options
Certified Diversified® warranty program
Information on each investment and fund manager
Ongoing member support
Documentation retention policy compliant with legislation
Manulife provides a vide range of communication materials such as member statements and personalized member newsletters.
Manulife offers a range of investment options, from “One-Touch funds” (Retirement Date funds) and “Low-Touch Funds” (Asset Allocation Funds) to “High-touch Funds” (build your own portfolio).
NOTE TO PRESENTER: “Diverse rage of investment options” bullet is linked to Slide 33 (hidden) that provides more details on investment options.
Certified Diversified is an innovative program that provides additional measure of security for plan sponsors by certifying that fund line-up meets CAP Guidelines for diversification (NOTE: linked to hidden slide 32)

14. 2. Investments and Decision-Making Tools
You should provide tools to assist members in decision making, such as:
Information on the decisions plan members must make
Investment information
Investment decision-making tools
Investment advice
The next step of your periodic review should place focus on the investment options available in the plan. Review of the investment options should be conducted at least annually.
A few factors to consider when establishing criteria for the periodic review of investment options include:
the criteria used to select the investment options; and
the frequency and/or triggering events for the review.

15. 2. Investments and Decision-Making Tools
Manulife provides a variety of tools to assist CAP members:
Steps Retirement Program®
Award-winning statements
Annual review workbook
Online Education Module
Here are a few of the tools Manulife offers:
The Steps Retirement Program, which is designed to help members set a retirement goal and track progress towards their estimated retirement income (linked to hidden slide 30 that provides more details). It is available to members through the secure section of the plan member website.
Member statements are sent out at least once per year, and provide details on the member’s investments as well as his or her “Steps” progress (or a reminder to set a Steps goal if member has not already).
An annual review workbook is also available to members to walk them though reviewing plan details, risk tolerance, investments and Steps goal.
An award-winning Online Education Module provides basic investment education in an easy, interactive video format (linked to a Education Basics video).

16. 3. Introducing CAP to members
Communications should include:
Nature and features of the CAP
Rights and responsibilities of members
Investment options
Transfer options
Fees, expenses and penalties
When introducing CAP to members, ensure the communication covers all of the plan details and features:
Nature and features of the CAP
Rights and responsibilities of members
Investment Options
Transfer Options
Fees, expenses and penalties .

17. 3. Introducing CAP to members
Manulife provides communication materials to help introduce CAP to members:
Welcome letters
Announcement materials
Member booklets (outline plan details, fees and legislation)
Paper and online enrolment options
When introducing the CAP to employees, Manulife has a series of educational materials to help you. They provide detailed information on CAP rules as well as easy to follow, step-by-step instructions on how to join the plan.
A number of these materials are available in print and electronic formats, making it easy to communicate to employees. Here are some of the materials available:
Comprehensive enrolment information that allows members to join quickly and easily.
An overview of the program’s details, such as the investments and services available.
Individual booklets that outline the fees and legislation that affect the retirement program

18. 4. Ongoing Member Communication
Regularly provide members with account information and investment performance
Communication should include:
Account statements
Reports on significant changes in investment options
Fund performance reports
Plan Sponsors are responsible for providing on-going communication to plan members and making information about plan readily available. This kind of communication can be delegated to service providers, however the plan sponsor should ensure the communication is sufficient and easily accessible for members.

19. 4. Ongoing Member Communication
How Manulife can help…
Secure Website
Industry-leading members statements
Investment details specific to the policy
Plan Default Letter Service
Personalized Newsletters
Customer Service Representatives
Financial Education Specialists
Once the retirement program has been introduced to plan members, providing them with consistent communication will be vital to keeping them engaged. Here are some of the ways Manulife helps you maintain a connection with members:
Through the secure plan member website, members can check their account balance, investment performance and personal rates of return. They can also complete transactions such as a fund transfer or an address change.
Members receive industry-leading account statements. The first page of the statement shows vital information such as the member’s account balance and estimated retirement income, these statements help members see if they are on track to reaching their retirement goals.
With their account statements, plan members also receive personalized newsletters with articles targeted to each member’s age, savings behaviour and investor type.
For account, investment and retirement planning questions, members can contact a Manulife Customer Service Representative – Financial Education Specialist – by telephone or .
Note to presenter: The Personalized Newsletters point is linked to slide 20 (hidden) that contains examples of personalized member newsletters

20. 4. Ongoing Member Communication
Personalized member newsletters are produced semi-annually and are included with the plan member statement. Each newsletter is personally addressed to an individual plan member and includes articles targeted to match that individual’s age range and retirement savings behaviour. Newsletter text also reflects the type of plan(s) and the investments the member holds. Some common articles will appear when a topic of broad interest emerges, such as enhancements to Manulife services.
Personalized member newsletters are produced semi-annually. Available in paper and online, each newsletter is personally addressed to an individual plan member and includes articles targeted to match that individual's age range and retirement savings behaviour. Newsletter text also reflects the type(s) of plan and the investments members hold. Some common articles will appear when a topic of broad interest emerges, such as Manulife service enhancements.

21. 5. Maintaining a CAP Review the following regularly:
Service provider(s)
Recordkeeping, investment advice
Investment options
Maintenance of records
Decision-making tools
Decide on action plan if service provider does not meet specified criteria
Once you have your plan set up and launched, it needs to be maintained. It’s the CAP sponsor’s responsibility to periodically review the service provider, fund line-up, records maintenance and decision-making tools provided to Plan members.

22. 5. Maintaining a CAP Manulife provides tools to help you
Sample agenda for plan governance meetings
Checklist for an annual review
Account Manager available to help complete the review
Sample questionnaires to help gauge members’ investment knowledge
Investment watch and review
Manulife's online Plan Governance Support Centre will walk you through the necessary steps to complete this review.
A checklist - found in the Support Centre - will help with the annual review of the plan. You will be able to review the specifics of your policy, including:
Service requirements and expectations.
Member education and communication tools – both electronic and paper versions.
The CAP’s fund line-up and
The quality of service provided to members.
Note to presenter: The “Investment watch and review” point is linked to slide 23 (hidden) that provides examples of iWatch Alerts

23. 5. Maintaining a CAP i-Watch Alerts and Notices
Alerts of funds changes
Products affected
Impact on managers and fund performance
Manulife’s assessment
If a fund does not meet Manulife’s criteria, it’s placed on a more frequent review cycle that includes notifying the fund manager about concerns and scheduling the fund for quarterly formal reviews. Quarterly formal reviews continue until the fund passes Manulife’s review, the fund is removed or the manager is replaced. This monitoring process helps Manulife identify and address small issues before they escalate. Investment Watch gives plan sponsors confidence that the investments available through the plan meet the savings needs of plan members.

24. 6. Termination
When terminating a CAP or a CAP member, ensure termination complies with policy contract and applicable legislation:
Provide members with options and actions to take
Deadlines for member action
Default options if applicable
Impact on investment options
Manner in which the plan assets will be liquidated or distributed
The final guideline provides direction if you decide to close your plan or if a member leaves the plan. Termination should be completed in accordance with the policy contract and applicable legislation.

25. 6. Termination
Manulife provides support by meeting reporting and communication requirements.
We work with applicable legislative authorities to ensure proper approval of CAP termination
Option reports outline members’ options for termination of CAP as well as employment, retirement or death.
Transition Solutions team
Manulife provides support to CAP sponsors by meeting reporting requirements and communicating to members.
Manulife works with the applicable legislative authorities to ensure the sponsor receives proper approval when terminating the CAP.
Manulife provides detailed options statements to Plan members outlining their choices and telling them when they need to decide what to do with their assets in the CAP. These are also provided to members who initiate the termination of their account by leaving their employer or retiring.
In addition, Manulife’s Transition Solutions team is available to help the members with the options they have when leaving the plan
NOTE to presenter: Transition Solutions bullet linked to slide 26 (hidden) that provides more information on the Transition Solutions team.

26. 6. Termination Transition Solutions Team Options include:
Licensed staff
Proactively contact terminating or retiring members to help them understand their options
Options include:
Personal Plan for terminating members
Group RRIF for retiring members
Purchase of an individual annuity
External transfer
Manulife's Group Savings and Retirement Solutions area has established a Transition Solutions team. This team of specialists is dedicated to helping plan members who are terminating their employment or retiring assess options for their assets in a group savings plan(s).
These specialists provide guidance on the options available for a member’s plan assets so he or she can make a well-informed decision. If a member chooses an option with Manulife, the team will also assist the member with:
moving assets to the Manulife Personal Plan,
purchasing an annuity,
moving assets into a Group Retirement Income Plan (GRIP), or
understanding what documentation is required to transfer to another institution.
For members who want to continue saving for retirement, Manulife Financial offers the Personal Plan. Members ready to start receiving a retirement income have access to the Group Retirement Income Plan. When members leave a GSRS will automatically transfer them to the Manulife Personal Plan. The Personal Plan offers members many of the same services and support they received as a member of your group plan. Their investments will be transferred over intact – meaning the interest rates and maturity dates on all guaranteed interest accounts will be maintained.
Manulife's Group Retirement Solutions now has a Transition Solutions team dedicated to help plan members who are terminating their employment or retiring assess their options for their group retirement savings program. These specialists provide guidance to members on the options available so each member can make an informed decision about the transition of their retirement savings.
The Transition Solutions team also assists members with:
Moving assets to the commissioned Manulife Personal Plan,
Purchasing an annuity,
Moving assets into a Group Retirement Income Plan (GRIP), or
Understanding what documentation is required to transfer to another institution.
Our Transition Solutions Specialists are bilingual, knowledgeable staff with a Canadian Securities Course (CSC) or Investment Funds Institute of Canada (IFIC) designation and a Life Insurance license.

27. Next Steps
Complete the annual review checklist found on the secure site
Ensure appropriate steps are taken to address gaps found during review
Review education plan
Provide sponsors with suggested next steps.

28. Thank You
For more information and help with completing your annual review visit the Online Plan Governance Centre

29. <OPTIONAL SLIDES>

30. How Manulife Can Help: Investments and Tools
Financial Education Specialists:
Available from Monday to Friday 9am – 5pm ET
Located across Canada
Bilingual
Retirement Plans Associate (RPA) certified
They will…
Support members in completing Investor Strategy Worksheet
Provide guidance on Steps Retirement Program®
Give detailed investment information
Assist members on completing an Annual Review of their investments
If plan members have investment or retirement planning questions, they can easily contact Financial Education Specialists from Monday to Friday, 9 a.m. - 5 p.m. ET using the Interactive Voice Response system (IVR). These individuals are located across Canada, are bilingual, and are Retirement Plans Associate (RPA) Certified.
Our Financial Education Specialists will help members:
Get answers to questions about the investment options available in their plan,
Complete the Investor Strategy Worksheet and choose investment options that suit their investor styles,
Review their retirement plans to ensure they’re on track, and if necessary, provide suggestions to getting back on track, and
Complete an annual investment review.

31. How Manulife Can Help: Investments and Tools
Steps Retirement Program®
Steps helps answer this question:
How much am I likely to have when I retire?
Steps shows each member’s annual ERI – estimated retirement income – during retirement
Based on personal details including age, assets, contribution level, investor profile
Plan members need the answer to one question as they're building toward retirement: how much am I likely to have when I retire?
To be useful to the member, the estimate of likely outcome must be clearly presented and tailored based on personal details. The estimated retirement income – or ERI – delivered by the Steps Retirement Program® shows each plan member's estimated annual retirement income based on his or her personal details including age, assets and contribution level, as well as investor profile.
Knowing their Estimated Retirement Income, members can set their sights on the lifestyle they would like to lead in retirement and they can better understand the retirement savings required to achieve this lifestyle. Steps lets members easily estimate how much money they’ll need to contribute to help meet their goal.
Members who choose to add details into their personal profiles on the secure site can refine their estimates to include spousal information, the contribution of bonus amounts, or savings outside of the group plan. Members can also exclude government benefits to see the effect on ERI.

32. How Manulife Can Help: Setting up a CAP
Certified Diversified® Warranty
Innovative program provides additional measure of security for plan sponsors
Certify that fund line-up meets CAP Guidelines for diversification
Protects plan sponsors from legal fees in the event of a successful claim
The first program of its kind in Canada, Manulife Financial’s innovative Certified Diversified warranty program provides an additional measure of confidence for plan sponsors when they’re choosing an investment line-up for a plan.
Provided the investments made available to your plan satisfy the established criteria for the program, Manulife will certify that your plan’s fund line-up meets the CAP Guideline criteria for investment diversification.
In the event of a final and successful third party claim indicating the options you selected from Manulife’s Group Retirement Solutions investment line-up failed to meet the CAP requirements for investment diversification, Manulife will fund any un-reimbursed losses suffered by the plan in relation to defending the claim.

33. How Manulife Can Help: Maintaining a CAP
i-Watch® Review
All common investment platform funds are subject to review
Semi-annual and annual review period depending on fund structure
Reviewed quarterly if “on-watch”
The Investment Watch process continues long after a fund or fund manager is selected. Manulife is committed to ensuring that managers continue to offer you and your members good value. Manulife’s process for reviewing fund managers includes daily, monthly and quarterly monitoring of market events and fund performance. Semi-annual and annual reviews are scheduled depending on the structure of each fund.
To help support sponsors in the continuing education of members, i-Watch reviews are available for each fund on both the Plan Sponsor and Plan Member Internet sites at

34. How Manulife Can Help: Setting up a CAP
Offers excellent diversification:
By asset class, fund manager and fund style
31 alliance partnerships
Supports three types of investors
One touch
Low touch
High touch
Retirement Date Funds
Asset Allocation Funds
Build-your-own Portfolio of Funds

35. Step 1: Where do I want to be?
As members complete the Steps Retirement Program, they can choose one of five lifestyle profiles that may help determine the member’s desired lifestyle.
Each lists a series of activities that they might enjoy in that scenario, and suggests the annual income needed.
For instance, with an estimated annual retirement income of $51,000 a member may enjoy:
Do-it-yourself home projects such as gardening or home improvements;
Spending time with family, perhaps going to movies with grandchildren or watching them participate in local sports activities;
Attending sporting events; and
Visiting local amusement parks, zoos, and exhibitions.
If the five lifestyle scenarios presented do not suit the member, he or she can create a lifestyle goal that is more suited to estimated retirement income.

36. Step 2: How do I get there?
Steps helps members determine their investor style with the eight-question Investor Strategy Questionnaire.

37. Step 3: Am I on track? Graph view Detailed view
Steps calculates the member’s estimated retirement income using data the member provides in previous steps. The member is able to see progress in two separate views. First, the graph view that displays the member’s estimated retirement income by source (e.g. government benefits, the group plan, other retirement income). Members are told if they are on track to meet their retirement income goal. If they are not on track, the program provides suggestions to get back on track. The graph view also includes ‘sliders’ that allow the member to change assumptions (monthly contributions, retirement income amount) with the click of a button and see the impact it will have.
Members also are able to view a more detailed breakdown of retirement income. This graph shows the different sources of income at retirement and shows when the member will start to receive income from them. An audio explanation of the graph is provided to help understand what it is showing.
The member can also experiment with different “what if” scenarios and see their impact.
Detailed view