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Vanguard Investor Index Funds Supplementary Product Disclosure Statement Date: 9 January 2008

About this document

This document is a Supplementary Product Disclosure Statement. It updates the Product Disclosure Statement for the Vanguard Investor Index Funds dated 11 December 2007 (the “2007 Product Disclosure Statement”) and must be read in conjunction with it. Together they form the Product Disclosure Statement for the Vanguard Investor Index Funds. Information in the Product Disclosure Statement is subject to change. If the changes are not materially adverse to investors, Vanguard may publish the updated information on the Vanguard website at www.vanguard.com.au. A paper copy of these updates is available on request at no charge. Investors will be notified of any materially adverse changes. Except to the extent amended by this Supplementary Product Disclosure Statement or updated on our website, the 2007 Product Disclosure Statement remains in full force. Updated asset allocation for the Vanguard Index Diversified Bond Fund ®

The following table replaces the asset allocation information of the Vanguard Index Diversified Bond Fund on page 12 of the 2007 Product Disclosure Statement.

Updated asset allocation for the Vanguard LifeStrategy High Growth Fund ®

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The following table replaces the asset allocation information of the Vanguard LifeStrategy High Growth Fund on page 22 of the 2007 Product Disclosure Statement.

Asset allocation Asset class

Actual Strategic Asset allocation at asset allocation 31 October 2007 allocation ranges % % %

Growth assets Australian shares

45.7

44.0

42-46

International shares

27.3

29.0

27-31

Australian property securities

5.0

5.0 9-11

International property securities (Hedged)

4.9

5.0

International small companies (Hedged)

4.0

4.0

3-5

Emerging markets shares

2.9

3.0

2-4

89.8

90.0

88-92

4.0

4.0

3-5

Total Growth

Asset allocation As at 31 October 2007 Income assets Region

Fund weight % Index weight %

Australia

40.1

40.2

North America

17.7

17.8

Europe ex-UK

27.4

27.3

Japan

10.9

10.8

3.6

3.6

UK Asia ex-Japan Total

0.3

0.3

100.0

100.0

Actual asset allocations will closely track the index

Australian fixed interest International fixed interest (Hedged)

6.2

6.0

5-7

Australian cash

0.0

0.0

0-1

10.2

10.0

8-12

Total Income


Vanguard Investments Australia Ltd ABN 72 072 881 086 AFSL 227263 RSE L0001335

Vanguard Investor Index Funds 速

Product Disclosure Statement Dated 11 December 2007


About Vanguard The Vanguard Group, Inc. is based in the US and is one of the largest fund managers in the world, managing over AUS$1.4 trillion for more than 22 million investor accounts. The Vanguard Group, Inc. also has offices in Europe, Japan and South-East Asia and has a particular expertise in index fund management, having established the world’s first public-offer index fund in 1976. Established in 1996, Vanguard Investments Australia Ltd (Vanguard) is the Australian arm of The Vanguard Group, Inc. Vanguard combines the skills of its team of Australian investment professionals with the strength of its parent company, one of the world’s largest investment management companies. Vanguard has established a reputation in Australia as an index specialist, managing more than AUS$74 billion in index funds as at September 2007.

About this PDS

available to persons receiving the electronic version of this PDS in Australia. Applications from outside of Australia will not be accepted through this PDS.

This Product Disclosure Statement (PDS) is for the Vanguard Investor Index Funds (Funds) as listed in the table below and is dated 11 December 2007.

Disclaimers Your investment in the Funds is subject to risk, which may include possible delays in repayment and loss of income and principal invested. None of the Vanguard Group, Inc., Vanguard Investments Australia Ltd or their related entities, directors or officers gives any guarantee or assurance as to the performance of, or the repayment of capital or income reinvested, in any of the Funds described in this PDS. Members of the Vanguard Group, Inc. may invest in, lend to or provide other services to the Funds.

Vanguard Investments Australia Ltd ABN 72 072 881 086 AFSL 227263 RSEL L0001335 (Vanguard) is the issuer of this PDS and is solely responsible for its contents. In this PDS references to ‘Vanguard’, the ‘Responsible Entity’, ‘Manager’, ‘we’, ‘our’ and ‘us’ refer to Vanguard Investments Australia Ltd.

Important information If you have received this PDS electronically and would like a paper copy, please contact Client Services on 1300 655 101 and a copy will be provided free of charge. Unless otherwise stated, data sources are Vanguard using market data, and all material is current as at the date of this PDS.

This PDS is prepared for your general information only. It is not intended to be a recommendation by Vanguard, any of Vanguard’s associates or any other person to invest in the Funds. In preparing this PDS, Vanguard did not take into account the investment objectives, financial situation or particular needs of any particular person. Before making an investment decision, investors need to consider (with or without the advice or assistance of an adviser) whether an investment in the funds is appropriate to their needs, objectives and circumstances.

Information in this PDS that is not materially adverse to investors is subject to change from time to time and may be updated by Vanguard by publishing such information on the Vanguard website at www.vanguard.com.au. A paper copy of any updated information will be given upon request and is free of charge.

Restrictions on investments Vanguard Investments , LifeStrategy , Plain Talk™, Helm™, Vanguard Online and the ship logo are trademarks of The Vanguard Group, Inc. © Copyright 2007 Vanguard Investments Australia Ltd. All rights reserved.

Please read the entire PDS carefully so that you understand the risks which may apply to the Funds. Applications for investment in the Funds may only be made on the Application for Investment Form attached to this PDS or accompanied by an electronic version of this PDS. The offer to which the electronic version of this PDS relates is only Vanguard Investor Index Funds Name of Fund Asset Sector Investor Index Funds

®

®

®

BPAY registered to BPAY Pty Ltd ABN 69 079 137 518. ®

ARSN

ABN

APIR

Vanguard® Index Cash Plus Fund

090 995 887

64 380 598 371

VAN0100AU

Vanguard® Index Diversified Bond Fund

090 995 841

96 491 646 070

VAN0101AU

Vanguard® Index Australian Shares Fund

090 995 770

38 931 692 506

VAN0010AU

Vanguard® High Yield Australian Shares Fund

109 638 379

19 060 820 283

VAN0017AU

Vanguard® Index Property Securities Fund

090 995 494

99 571 736 269

VAN0012AU

Vanguard® Index International Shares Fund

090 995 583

42 389 448 403

VAN0011AU

Vanguard® Index Hedged International Shares Fund

095 375 894

66 256 805 696

VAN0107AU

Diversified Investor Index Funds

Vanguard® LifeStrategy® Conservative Fund

090 996 044

68 558 424 817

VAN0013AU

Vanguard® LifeStrategy® Balanced Fund

103 186 607

31 948 445 348

VAN0124AU

Vanguard® LifeStrategy® Growth Fund

090 996 099

73 804 372 624

VAN0014AU

Vanguard® LifeStrategy® High Growth Fund

090 995 967

38 087 357 469

VAN0015AU


Contents Key information Key features of the Vanguard investor index funds Indexing and its benefits Risks

Page 3 6 7

Specific fund information Asset sector investor index funds Vanguard Index Cash Plus Fund Vanguard Index Diversified Bond Fund Vanguard Index Australian Shares Fund Vanguard High Yield Australian Shares Fund Vanguard Index Property Securities Fund Vanguard Index International Shares Fund Vanguard Index Hedged International Shares Fund

10 11 12 13 14 15 16 17

Diversified investor index funds Vanguard LifeStrategy Conservative Fund Vanguard LifeStrategy Balanced Fund Vanguard LifeStrategy Growth Fund Vanguard LifeStrategy High Growth Fund

18 19 20 21 22

Additional information Fees and other costs 23 Additional explanation of fees and other costs 27 Your guide to investing 29 Taxation of the funds 35 Other information you need to know 37 How to invest 40 Application for Investment Form Contacting Vanguard Inside back cover

2


Key information

Key features – Asset sector investor index funds Features

Vanguard Index Cash Plus Fund

Vanguard Index Diversified Bond Fund

Vanguard Index Australian Shares Fund

Vanguard High Yield Australian Shares Fund

Investment objective

Seeks to match the total return of a customised index (the Vanguard Cash Plus Index), which is a measure of high quality Australian cash and short-term fixed interest (debt) securities, before taking into account fund fees and expenses.

Seeks to match the total return of a customised index, comprising a 40% allocation to Australian fixed interest securities (bonds) and 60% allocation to international bonds, before taking into account fund fees and expenses.

Seeks to match the total return of the S&P/ASX 300 Index before taking into account fund fees and expenses.

This fund is a stylebiased index fund that seeks to provide a total return that is broadly in line with that of the S&P/ASX 200 Index (excluding Listed Property Trusts) before taking into account fund fees and expenses, while also aiming to provide higher yield and keeping net realised capital gains low.

Fund commencement date

19 January 2000

19 January 2000

26 October 1998

15 July 2004

$52.2 million

$402.2 million

$77.8 million

Fund size as at 31 October 2007 $15.1 million A

Minimum initial application

$5,000

$5,000

$5,000

$5,000

Application fee

Nil

Nil

Nil

Nil

Withdrawal fee

Nil

Nil

Nil

Nil

Switching fee

Nil

Nil

Nil

Nil

Minimum additional investment amount: By cheque By BPAY

$1,000 $100

$1,000 $100

$1,000 $100

$1,000 $100

Minimum holding balance

$3,000

$3,000

$3,000

$3,000

Minimum withdrawal or switch

$1,000

$1,000

$1,000

$1,000

Access to funds

Withdrawals are Withdrawals are Withdrawals are Withdrawals are normally paid within normally paid within normally paid within normally paid within seven business days seven business days seven business days seven business days

Income distributions

Monthly

Quarterly as at 31 March, 30 June, 30 September, 31 December

Half yearly as at 30 June, 31 December

Monthly

Unit pricing frequency

Daily

Daily

Daily

Daily

Buy/spread (purchase)

Nil

+0.15%

+0.20%

+0.20%

Sell spread (withdrawal)

Nil

-0.15%

-0.10%

-0.10%

0.70% p.a. 0.50% p.a. 0.35% p.a.

0.75% p.a. 0.50% p.a. 0.35% p.a.

0.75% p.a. 0.50% p.a. 0.35% p.a.

0.90% p.a. 0.60% p.a. 0.45% p.a.

B

Management costs For the first $50,000 For the next $50,000 Balance over $100,000

A B

3

Vanguard may accept a lesser amount at its discretion. The management costs for the funds incorporate Goods and Services Tax (GST) after taking into account any expected input tax credits. Please refer to page 27 for more information concerning the management costs.

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Vanguard Investor Index Funds Product Disclosure Statement


Key features – Asset sector investor index funds Features

Vanguard Index Property Securities Fund

Vanguard Index International Shares Fund

Vanguard Index Hedged International Shares Fund

Investment objective

Seeks to match the total return of the S&P/ASX 300 Property Trusts Index before taking into account fund fees and expenses.

Seeks to match the total return of the MSCI World ex-Australia Index (with net dividends reinvested) in Australian dollars before taking into account fund fees and expenses.

Seeks to match the total return of the MSCI World ex-Australia Index (with net dividends reinvested), hedged to Australian dollars, before taking into account fund fees and expenses.

Fund commencement date

26 October 1998

26 October 1998

19 January 2001

$198.5 million

$193.4 million

Fund size as at 31 October 2007 $190.6 million A

Minimum initial application

$5,000

$5,000

$5,000

Application fee

Nil

Nil

Nil

Withdrawal fee

Nil

Nil

Nil

Switching fee

Nil

Nil

Nil

Minimum additional investment amount: By cheque By BPAY

$1,000 $100

$1,000 $100

$1,000 $100

Minimum holding balance

$3,000

$3,000

$3,000

Minimum withdrawal or switch

$1,000

$1,000

$1,000

Access to funds

Withdrawals are Withdrawals are Withdrawals are normally paid within normally paid within normally paid within seven business days seven business days seven business days

Income distributions

Half yearly as at 30 June, 31 December

Half yearly as at 30 June, 31 December

Half yearly as at 30 June, 31 December

Unit pricing frequency

Daily

Daily

Daily

Buy/spread (purchase)

+0.20%

+0.30%

+0.35%

Sell spread (withdrawal)

-0.20%

-0.10%

-0.15%

0.90% p.a. 0.60% p.a. 0.35% p.a.

0.90% p.a. 0.60% p.a. 0.35% p.a.

0.90% p.a. 0.60% p.a. 0.35% p.a.

B

Management costs For the first $50,000 For the next $50,000 Balance over $100,000

A B

Vanguard may accept a lesser amount at its discretion. The management costs for the funds incorporate Goods and Services Tax (GST) after taking into account any expected input tax credits. Please refer to page 27 for more information concerning the management costs.

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Vanguard Investor Index Funds Product Disclosure Statement

4


Key information

Key features – Diversified investor index funds Features

Vanguard LifeStrategy Conservative Fund

Investment objective

Seeks to match the weighted average return of the target indexes of each of the underlying Vanguard Index Funds in which it invests, before taking into account fund fees and expenses. The weights used are the strategic asset allocations to each asset class.

Asset allocation

Growth 30% Income 70%

Growth 50% Income 50%

Growth 70% Income 30%

Growth 90% Income 10%

Fund commencement date

26 October 1998

14 February 2003

26 October 1998

26 October 1998

$25.4 million

$87.7 million

$98.5 million

Fund size as at 31 October 2007 $7.5 million A

Vanguard LifeStrategy Balanced Fund

Vanguard LifeStrategy Growth Fund

Vanguard LifeStrategy High Growth Fund

Minimum initial application

$5,000

$5,000

$5,000

$5,000

Application fee

Nil

Nil

Nil

Nil

Withdrawal fee

Nil

Nil

Nil

Nil

Switching fee

Nil

Nil

Nil

Nil

Minimum additional investment amount: By cheque By BPAY

$1,000 $100

$1,000 $100

$1,000 $100

$1,000 $100

Minimum holding balance

$3,000

$3,000

$3,000

$3,000

Minimum withdrawal or switch

$1,000

$1,000

$1,000

$1,000

Access to funds

Withdrawals are Withdrawals are Withdrawals are Withdrawals are normally paid within normally paid within normally paid within normally paid within seven business days seven business days seven business days seven business days

Income distributions

Half yearly as at 30 June, 31 December

Half yearly as at 30 June, 31 December

Half yearly as at 30 June, 31 December

Half yearly as at 30 June, 31 December

Unit pricing frequency

Daily

Daily

Daily

Daily

Buy/spread (purchase)

+0.15%

+0.20%

+0.25%

+0.30%

Sell spread (withdrawal)

-0.10%

-0.15%

-0.15%

-0.20%

0.90% p.a. 0.60% p.a. 0.35% p.a.

0.90% p.a. 0.60% p.a. 0.35% p.a.

0.90% p.a. 0.60% p.a. 0.35% p.a.

0.90% p.a. 0.60% p.a. 0.35% p.a.

B

Management costs For the first $50,000 For the next $50,000 Balance over $100,000

A B

5

Vanguard may accept a lesser amount at its discretion. The management costs for the funds incorporate Goods and Services Tax (GST) after taking into account any expected input tax credits. Please refer to page 27 for more information concerning the management costs.

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Vanguard Investor Index Funds Product Disclosure Statement


Indexing and its benefits Before you make an investment decision, it is important for you to read this Product Disclosure Statement (PDS) and assess whether the investment is appropriate to your objectives, financial situation and needs.

Historically, the returns of index funds have been competitive in the long term, relative to the returns of active managers. However, past performance is not an indicator of future performance.

What is an index?

Broad diversification

An index measures the performance or change in value of a particular group of securities, such as shares, bonds or other investments, over a period of time. Today, there are indexes measuring investment results of all major asset classes.

Index funds are broadly diversified, which means that you are less exposed to the performance fluctuations of individual shares or securities. The overall effect is that you moderate the volatility of your portfolio and ‘smooth out’ your investment returns over time. Index funds invest in a wide selection of securities in the relevant index, holding significantly more securities than most active funds with the same benchmark.

What are index funds? There are two types of managed funds – index funds and active funds. Index funds invest in securities and are structured to deliver investment returns that closely match the total returns of selected indexes. Active funds are typically invested to try to outperform pre-defined indexes or benchmarks. Active funds attempt to meet their performance objectives with a combination of stock picking, market timing and asset allocation decisions. Active funds typically hold far fewer securities than index funds but will generally have a high level of trading activity within the fund (i.e. buying and selling of securities) otherwise known as portfolio turnover. There is an associated risk of underperformance with active funds. Index funds do not rely on ‘hot stocks’ in an attempt to outperform the market. Nor do they rely on timing the market – e.g. selling on a prediction of a market fall and buying on a prediction that the market will rise. The value or return of an index fund typically goes up or down in line with the market. An index fund may hold all of the securities included in the selected index or a representative sample of these securities. Index funds employ a buy and hold strategy that will result in low portfolio turnover. Unlike indexes – which are theoretical measures – index funds have costs associated with investing in securities. While index funds seek to minimise these costs, the returns of index funds are usually less than the returns of the relevant index to the extent of these costs.

Simplicity Index funds take the guesswork out of investing and eliminate the worry of trying to ‘pick winners’ or attempting to time the markets. You don’t have to try to analyse the strategy of various managers to choose one you think can outperform the market.

Low cost advantage Lower management fees – index funds have lower

ongoing fees than most active funds investing in similar assets. In other words, it costs less to manage and operate an index fund compared to active funds. Lower transaction costs – index funds have lower portfolio turnover than most active funds resulting in lower trading costs.

Tax efficiency Funds which have a high level of portfolio turnover generally create greater capital gains tax liabilities for investors than funds with lower turnover rates. Generally, the lower the portfolio turnover, the longer securities are held within a portfolio – and if securities are held for more than 12 months, any capital gain on the disposal of those securities will attract a lower tax rate for investors who are eligible for the capital gains discount.

Key benefits Competitive long-term performance Over the long term, it is very difficult to continually pick winners and outperform the major investment markets, such as Australian shares, international shares, bonds, property or cash. In fact, in most asset sectors over the long term, the majority of active funds have a history of failing to outperform comparable market indexes, after fees and costs.

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Vanguard Investor Index Funds Product Disclosure Statement

6


Key information

Risks Investors in the funds face a number of investment risks. It is important to keep in mind one of the main principles of investing: the higher the potential reward, the higher the risk of losing money. The reverse is also generally true: the lower the risk, the lower the potential reward. When you consider an investment in one or more of the funds, you should take into account your personal tolerance for fluctuating market values. Remember too, that since each fund seeks to match a different market index, investment risk will vary from fund to fund. There is no guarantee that the value of your investment principal will be maintained – you can lose money.

Market risk Market risk is the possibility that the market has negative returns over short or even extended periods. Cash investments have the lowest market risk. Bonds, then property securities and then equities have increasing levels of market risk. Short-term market risks are high to very high for most asset classes.

Counterparty risk/Credit risk Counterparty risk is the risk that the fund’s trading counterparties become insolvent or cannot otherwise meet their obligations to the fund. For funds which invest in fixed interest and debt securities there is a credit risk. This is the risk that an issuer of a fixed interest or debt security may not meet its payment obligations to the funds. Vanguard seeks to minimise this risk by diversifying a fund’s holdings across issuers. For funds which invest in forward foreign exchange contracts there is risk associated with unrealised profits. This is generally a small proportion of the fund’s value. Credit risk is most applicable to the funds with significant exposure to fixed interest and debt securities such as: • Vanguard LifeStrategy Conservative Fund • Vanguard LifeStrategy Balanced Fund • Vanguard Index Cash Plus Fund • Vanguard Index Diversified Bond Fund

Currency risk In any asset sector the returns of individual securities are a combination of the market return and returns specific to each security. By diversifying their holdings across the market, index funds are generally well protected from the specific risk of individual securities. Their specific returns tend to cancel each other out, leaving the fund with the market return and its associated risk.

Derivative risk The primary risks associated with the use of derivative contracts are: • the values of the derivative failing to move in line with the underlying asset (a performance difference); • the potential lack of liquidity of the derivative; • the funds may not be able to meet payment obligations as they arise; and • the counterparty to the derivative contract may not meet its obligations under the contract. The funds do not use derivative contracts for speculative purposes or to leverage the assets of the Funds. The risk of a performance difference is minimised by investing in derivative contracts where the behaviour is expected to resemble that of the fund’s underlying securities. The risk that a fund may not be able to close out a derivatives position is minimised by entering into such transactions on an exchange with an active and liquid secondary market.

7

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Fluctuations in the value of the Australian dollar and foreign currencies can affect the returns from overseas investments. This is because losses or gains must be converted back into Australian dollars. A weaker Australian dollar increases the value of investments held in non-Australian dollars and therefore benefits the Australian investor holding non-Australian assets such as international shares. Conversely, if the value of the Australian dollar rises, the value of investments held in nonAustralian assets will fall. The Vanguard Index International Shares Fund does not hedge any of its exposure to foreign currencies. Accordingly, this fund is affected by currency fluctuations, and its value will be reduced with a rise in the Australian dollar. The Vanguard Index Hedged International Shares Fund invests on a fully hedged basis (to the Australian dollar) reducing its exposure to currency risk. Investors should be aware that hedging portfolios against currency risks involves costs and implementation risks due to the volatility of currency and securities markets.

Regulatory risk This is the risk that a government or regulator may introduce regulatory or tax changes that affect the value of securities in which one or more of the funds invests, or the value of your units in the fund.

Vanguard Investor Index Funds Product Disclosure Statement


The funds may be affected by changes to legislation or government policy both in Australia and in other countries. These changes are monitored by Vanguard and action taken where appropriate to facilitate the achievement of the funds’ investment objectives.

Manager risk The funds may fail to meet their objectives as a result of: • Vanguard’s selection of securities from the relevant index; • the costs of managing the portfolios that are not measured by the relevant index; and • a currency hedge failing to behave in line with the target indexes. Vanguard employs an indexing investment strategy in all asset classes in which the funds invest. This significantly lowers the risk of short-term underperformance relative to those target indexes, compared to managers who employ an active investment strategy relative to their own (index) benchmarks.

Fund risk Fund risk relates to risks which are particular to the funds. These may include risks that the funds could terminate, the fees and expenses could change or Vanguard could be replaced as Manager. There is also a risk that investing in the funds may give different results than investing directly because of the income or capital gains accrued in the funds and the consequences of investment and withdrawal by other investors.

Other operational risks There is a risk that circumstances beyond Vanguard’s reasonable control could prevent Vanguard from managing the investment options in accordance with its investment strategies and as otherwise contemplated by this PDS. Examples of these circumstances include strikes, industrial disputes, fires or other casualty, war, civil disturbance, terrorist acts, governmental pre-emption in connection with an emergency of state and epidemics (including potential epidemics). By investing in these funds you agree that Vanguard is not liable if Vanguard is prevented from managing the funds by circumstances beyond its reasonable control.

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Vanguard Investor Index Funds Product Disclosure Statement

8


Specific fund information

Asset sector investor index funds The following pages provide a description of the asset sector investor index funds, including a broad outline of the investment objectives, investment policy, asset allocation and other relevant information specific to each fund. The asset sector investor index funds do not invest directly in securities in the target asset sector. The funds each invest in units in another Vanguard fund (an “underlying fund”) which in turn invests in securities in the target asset sector. Note that Vanguard may change the underlying funds in which the retail sector funds invest at its discretion. For example, in future, some or all of the funds may commence investing directly in underlying securities and may commence investing in additional or different underlying funds and may cease investing in the underlying funds named below, at Vanguard's discretion. The following table lists the asset sector investor index funds and the underlying funds in which they invest: Investor Index Fund

Underlying Index Fund

Vanguard Index Cash Plus Fund

Vanguard Cash Plus Index Fund

Vanguard Index Diversified Bond Fund

Vanguard Australian Fixed Interest Index Fund Vanguard International Fixed Interest Fund (Hedged) Vanguard International Credit Securities Index Fund (Hedged)

Vanguard Index Australian Shares Fund

Vanguard Australian Shares Index Fund

Vanguard High Yield Australian Shares Fund

Vanguard Australian Shares High Yield Fund

Vanguard Index Property Securities Fund

Vanguard Property Securities Index Fund

Vanguard Index International Shares Fund

Vanguard International Shares Index Fund

Vanguard Index Hedged International Shares Fund

Vanguard International Shares Index Fund (Hedged)

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Vanguard Investor Index Funds Product Disclosure Statement

10


Specific fund information

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Vanguard Index Cash Plus Fund Investment objective

Fund performance

The fund seeks to match the total return of a customised index (the Vanguard Cash Plus Index), which is a measure of high quality Australian cash and short-term fixed interest (debt) securities, before taking into account fund fees and expenses.

Period ending 31 October 2007 Fund and index returns Fund return (after fees and expenses)

The index The Vanguard Cash Plus Index is a customised index which has been developed by Vanguard to measure the performance of high quality Australian debt securities. The index has been constructed and is administered in the same manner as other market indexes. Like the UBS Australian Bank Bill Index, the index is calculated from reference rates which are derived from information from key market participants on a daily basis. The index has fixed allocations of: • 85% to a 6 month discount security; • 7.5% to a 1 year fixed interest security; and • 7.5% to a 2 year fixed interest security. The index is ‘reset’ on a weekly basis. Vanguard will not vary the allocations in an attempt to ‘time’ the markets. The average maturity (duration) of the index is approximately eight months. It is expected that the index will outperform the UBS Australian Bank Bill Index (which has an average maturity of 46 days) in two out of every three years. However, it may underperform the UBS Australian Bank Bill Index when short-term yields are persistently above long-term yields. Longer-term investments typically (but not always) offer higher yields than money market or cash investments.

Investment policy To closely track the index, Vanguard employs optimisation techniques to select debt securities, which together have similar market risk to the index, to form the underlying fund’s portfolio. The index is ‘reset’ weekly to maintain a stable duration while the duration of each security bought for the fund reduces each day (until maturity). Therefore, the passage of time changes the composition of the fund’s portfolio relative to the index and requires Vanguard to trade to maintain a portfolio that closely matches the index. Vanguard pays careful attention to minimising the transaction costs associated with investing cash flows and making adjustments to the portfolio.

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5.6

5.1

4.8

Fund return (before fees and expenses)

6.4

5.9

5.6

Index return

6.4

5.9

5.6

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.

Futures may be used to gain market exposure without investing directly in securities. This allows Vanguard to maintain fund liquidity without being under-invested.

Asset allocation Vanguard manages the fund within the following constraints: • The investments of the fund are restricted to: a) Commonwealth Government securities; b) deposits or securities rated AA or above (by Standard & Poor’s or Moody’s equivalent); c) deposits secured by a) or b); d) securities issued by licensed banks rated A-1 or higher (by Standard & Poor’s or Moody’s equivalent), that mature within 90 days and together form not more than 25% of the total market value of the Fund; e) cash deposits with licensed banks rated A-1 or higher (by Standard & Poor’s or Moody’s equivalent); and f) futures. • The maximum exposure to any single non-government issuer is 33% of the market value of the fund. • The modified duration of the fund will not exceed nine months. • To ensure liquidity of the fund, at least 65% of investments will be maintained in the form of highly liquid securities. • Futures may be used to manage market risk. Futures will not be used to leverage the portfolio or modify the risk characteristics of the portfolio away from the index.

Fund credit rating Standard & Poor’s has assigned the fund a credit rating of AAAf, which is the highest rating possible for a fund of this type. Vanguard intends to manage the fund in order to maintain this rating.

There is credit risk associated with debt securities. Vanguard seeks to minimise this risk by selecting only debt securities with a sufficiently high credit rating and by diversifying the fund’s holdings across issuers.

11

1 year 3 years 5 years % % p.a. % p.a.

Vanguard Investor Index Funds Product Disclosure Statement


®

Vanguard Index Diversified Bond Fund Investment objective

Asset allocation

The fund seeks to match the total return of a customised index, comprising a 40% allocation to Australian fixed interest securities (bonds) and 60% allocation to international bonds, before taking into account fund fees and expenses.

As at 31 October 2007 Region

Fund weight %

Australia

32.9

19.8

Europe ex-UK

46.4

27.9

Japan

The index comprises: • 40% UBS Australian Composite Bond Index; and • 60% Citigroup non-MBS World Broad InvestmentGrade Bond Index (hedged to Australian dollars).

40.1

North America UK

The index

Index weight %

0.2

Asia ex-Japan Total

6.0

3.6

14.1

8.4

0.4

0.2

100.0

100.0

Actual asset allocations will closely track the index

The UBS Australian Composite Bond Index is a value weighted index of approximately 310 securities (bonds) issued by the Commonwealth Government, State Government guaranteed treasury corporations and semi-government authorities, as well as investment grade corporate issues with a credit rating of at least A-.

Fund performance Period ending 31 October 2007 Fund and index returns Fund return (after fees and expenses)

The Citigroup non-MBS World Broad Investment-Grade Bond Index is a value weighted index of approximately 3,650 securities (bonds) issued by governments, government owned entities, government guaranteed entities and investment grade corporations with a credit rating of at least BBB-.

Fund return (before fees and expenses) Index return

1 year 3 years 5 years % % p.a. % p.a. 3.9

4.6

5.4

4.6

5.3

6.2

4.6

5.3

6.1

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.

Investment policy The fund invests in Australian and international bonds through the underlying Vanguard Index funds. The Australian fixed interest allocation invests in the Vanguard Australian Fixed Interest Index Fund and the international fixed interest allocation invests in the Vanguard International Fixed Interest Index Fund (Hedged) and the Vanguard International Credit Securities Index Fund (Hedged).

Hedging

Bond indexes change far more quickly than share indexes as bonds have a finite life. Every maturity and inclusion of new issues changes the composition of the index and require Vanguard to modify the portfolio. Accordingly, Vanguard pays careful attention to minimising the transaction costs associated with investing cash flows and making adjustments to the portfolio.

There are, however, side effects for the distributions from the fund. When the Australian dollar is appreciating, the hedge gains can result in significant distributions. When it is depreciating, the hedge losses can totally offset other income in the fund, resulting in nil distributions.

The fund uses forward foreign exchange contracts to offset depreciation and/or appreciation in the value of securities resulting from fluctuations of the currencies in the countries where the securities are held. The net result for the fund is that its total return is relatively unaffected by currency fluctuations.

Futures may be used to gain market exposure without investing directly in securities. This allows Vanguard to maintain fund liquidity without being under-invested.

Credit rating Standard & Poor’s has assigned the fund a credit rating of AAf, which is the same maximum rating that a fund that fully replicated the index could achieve. Vanguard intends to manage the fund such that it can maintain this rating comparability.

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Vanguard Investor Index Funds Product Disclosure Statement

12


Specific fund information

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Vanguard Index Australian Shares Fund Investment objective The fund seeks to match the total return of the S&P/ASX 300 Index before taking into account fund fees and expenses.

The index

As at 31 October 2007 Sector

Fund weight %

Investment policy To closely track the index, Vanguard employs optimisation techniques which involve selecting a representative sample of shares in the index. The underlying fund will hold most of the shares in the index, allowing for individual share weightings to vary marginally from the index from time to time. The fund may invest in shares that have been or are expected to be included in the index. Futures may be used to gain market exposure without investing directly in securities. This allows Vanguard to maintain fund liquidity without being under-invested.

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Vanguard Investor Index Funds Product Disclosure Statement

Index weight %

Industrials

73.7

73.6

Resources

26.3

26.4

100.0

100.0

Total

The S&P/ASX 300 Index comprises approximately 300 Australian equity securities (shares) and represents over 94% of the value of all Australian-based companies and property trusts listed on the Australian Stock Exchange.

13

Asset allocation

Actual asset allocations will closely track the index

Fund performance Period ending 31 October 2007 Fund and index returns Fund return (after fees and expenses)

1 year 3 years 5 years % % p.a. % p.a. 29.7

25.7

21.6

Fund return (before fees and expenses)

30.7

26.7

22.5

Index return

30.5

26.4

22.4

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.


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Vanguard High Yield Australian Shares Fund Investment objective

Asset allocation

The fund is a style-biased fund that seeks to provide a total return that is broadly in line with the S&P/ASX 200 Index (excluding Listed Property Trusts) before taking into account fund fees and expenses.

As at 31 October 2007 Sector

Fund weight % 75.7

71.5

Resources

24.3

28.5

100.0

100.0

Total

The fund is targeting a grossed-up dividend yield that is 1% above that of the Index. Grossed-up dividend yield is calculated taking into account both cash dividends and associated franking credits.

Index weight %

Industrials

Actual asset allocations will vary from time to time

Fund performance

The index

Period ending 31 October 2007

The S&P/ASX 200 Index (excluding listed property trusts) consists of approximately 170 Australian equity securities (shares) and represents over 92% of the value of all Australian-based companies (excluding listed property trusts) listed on the Australian Stock Exchange.

Fund and index returns

1 year 3 years 5 years % % p.a. % p.a.

Fund return (after fees and expenses)

29.2

23.2

Fund return (before fees and expenses)

30.4

24.3

n/a

Investment policy

Index return

31.5

27.2

n/a

Style-biased index funds can be managed by tracking indexes that are style-biased – such as published ‘value’ and ‘growth’ indexes – or by biasing the portfolio to a desired characteristic while targeting a broad market index. As there is no published index that is biased to the ‘high yield’ characteristic, Vanguard has selected the S&P/ASX 200 Index (excluding listed property trusts) as the index for this fund and selects shares from that index for the fund’s portfolio.

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.

n/a

The underlying fund will overweight the shares of some companies and underweight and even exclude others (relative to their index weights). Those positions do not reflect a view that some companies will outperform others. Rather, they bias the portfolio to the desired higher dividend yield and franking credit characteristics. The total return of the fund is expected to be broadly in line with the S&P/ASX 200 Index (excluding Listed Property Trusts). However, the fund’s performance is likely to deviate further from the index than other Vanguard Index Funds because shares for the fund’s portfolio are not being selected with the aim of substantially replicating the index but rather for their expected grossed-up dividend yield. Futures may be used to gain market exposure without investing directly in securities. This allows Vanguard to maintain fund liquidity without being under-invested. Where an assumption about the tax rate is relevant to an investment decision - for example, decisions on participating in share buybacks - Vanguard will assume that investors are in lower tax brackets. The taxation consequences may not be the same for all investors.

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Vanguard Investor Index Funds Product Disclosure Statement

14


Specific fund information

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Vanguard Index Property Securities Fund Investment objective The fund seeks to match the total return of the S&P/ASX 300 Property Trusts Index before taking into account fund fees and expenses.

The index The S&P/ASX 300 Property Trusts Index comprises approximately 36 property trust securities listed on the Australian Stock Exchange.

Investment policy To closely track the index, Vanguard employs optimised replication techniques to select property securities. The underlying fund will hold all of the securities in the index (at most times) allowing for individual security weightings to vary marginally from the index from time to time. The fund may invest in property securities that have been or are expected to be included in the index. Futures may be used to gain market exposure without investing directly in securities. This allows Vanguard to maintain fund liquidity without being under-invested.

Asset allocation As at 31 October 2007 Sector

Fund weight %

Index weight %

Retail

44.6

44.6

Diversified

35.8

35.8

Office

8.3

8.3

Industrial

11.3

11.3

Hotel/leisure Total

0.0

0.0

100.0

100.0

Actual asset allocations will closely track the index

Fund performance Period ending 31 October 2007 Fund and index returns Fund return (after fees and expenses) Fund return (before fees and expenses) Index return

1 year 3 years 5 years % % p.a. % p.a. 17.6

18.8

18.0

18.6

19.9

19.0

18.5

19.8

18.7

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.

15

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Vanguard Investor Index Funds Product Disclosure Statement


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Vanguard Index International Shares Fund Investment objective

Asset allocation

The fund seeks to match the total return of the MSCI World ex-Australia Index (with net dividends reinvested) in Australian dollars before taking into account fund fees and expenses.

As at 31 October 2007 Region

The index The MSCI World ex-Australia Index comprises approximately 1,700 securities (shares) listed on the exchanges of 22 of the world’s major developed economies.

Fund weight %

Index weight %

North America

53.1

53.0

Europe ex-UK

23.5

23.5

UK

11.6

11.6

Japan

10.1

10.1

Pacific ex-Japan Total

1.7

1.8

100.0

100.0

Actual asset allocations will closely track the index

Investment policy To closely track the index, Vanguard employs optimisation techniques which involve selecting a representative sample of shares in the index. The underlying fund will hold most of the shares in the index, allowing for individual share weightings to vary marginally from the index from time to time. The fund may invest in shares that have been or are expected to be included in the index.

Fund performance Period ending 31 October 2007 Fund and index returns Fund return (after fees and expenses)

Futures may be used to gain market exposure without investing directly in securities. This allows Vanguard to maintain fund liquidity without being under-invested. The fund does not hedge against exchange rate fluctuations.

1 year 3 years 5 years % % p.a. % p.a. -1.0

9.1

Fund return (before fees and expenses)

5.9

-0.1

10.0

6.9

Index return

-0.2

9.7

6.4

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.

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Vanguard Investor Index Funds Product Disclosure Statement

16


Specific fund information

®

Vanguard Index Hedged International Shares Fund Investment objective The fund seeks to match the total return of the MSCI World ex-Australia Index (with net dividends reinvested) hedged into Australian dollars, before taking into account fund fees and expenses.

The index The MSCI World ex-Australia Index comprises approximately 1,700 securities (shares) listed on the exchanges of 22 of the world’s major developed economies. For the purpose of this fund we assume that the index is hedged into Australian dollars.

Investment policy To closely track the index, Vanguard employs optimisation techniques which involve selecting a representative sample of shares in the index. The underlying fund will hold most of the shares in the index allowing for individual share weightings to vary marginally from the index from time to time. The fund may invest in shares that have been or are expected to be included in the index. Futures may be used to gain market exposure without investing directly in securities. This allows Vanguard to maintain fund liquidity without being under-invested.

Hedging The fund uses forward foreign exchange contracts to offset any depreciation and/or appreciation in the value of securities resulting from fluctuations of the currencies in the countries where the securities are held. The net result for the fund is that its total return is relatively unaffected by currency fluctuations. There are however, side effects for the distributions from the fund. When the Australian dollar is appreciating, the hedge gains can result in significant distributions. When it is depreciating, the hedge losses can totally offset other income in the fund, resulting in nil distributions.

17

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Vanguard Investor Index Funds Product Disclosure Statement

Asset allocation As at 31 October 2007 Region

Fund weight %

Index weight %

North America

53.1

53.0

Europe ex-UK

23.5

23.5

UK

11.6

11.6

Japan

10.1

10.1

Pacific ex-Japan Total

1.7

1.8

100.0

100.0

Actual asset allocations will closely track the index

Fund performance Period ending 31 October 2007 Fund and index returns Fund return (after fees and expenses) Fund return (before fees and expenses) Index return

1 year 3 years 5 years % % p.a. % p.a. 15.1

17.8

17.2

16.1

18.9

18.2

16.0

18.6

17.9

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.


Diversified investor index funds The Vanguard LifeStrategy Funds are diversified index funds investing across a number of asset sectors, including growth assets such as Australian shares, international shares and property and Australian listed property securities and income assets, such as Australian and international fixed interest (bonds) and cash. The funds provide you with a choice of asset allocations and are designed to help you establish a diversified portfolio that meets your individual needs. It is important that you consider whether any of these funds is suitable for you in light of your objectives, financial situation and needs. Vanguard may vary the strategic asset allocations and asset allocation ranges or introduce new asset classes from time to time. Vanguard will notify investors of any such changes. The investment strategy of each fund is reviewed at least annually by Vanguard. A fund may commence investing directly in securities and/or may commence investing in different or additional underlying funds at Vanguard’s discretion. The following pages describe each of the LifeStrategy funds covering the investment objective, investment policy, asset allocation and other relevant information specific to each fund. The funds maintain differing allocations to shares, property securities, bonds and cash and vary from conservative to growth oriented allocations.

The indexes tracked by the underlying funds are the same as the indexes referred to in pages 11 to 17 for the corresponding asset sector index funds. Some of the underlying funds invest in asset sectors which cannot be directly invested in through this PDS. Information about the indexes relevant to these asset sectors is listed below: • the index for emerging markets is the modified MSCI Emerging Markets Index; • the index for international property (hedged) is the UBS Global Real Estate Investors Index ex-Australia hedged into Australian dollars; • the index for international small companies (hedged) is the the MSCI World ex-Australia Small Cap Index hedged into Australian dollars; • the index for international credit securities (hedged) is the Citigroup non-MBS non-WGBI WorldBIG Bond Index hedged into Australian dollars; • the index for international fixed interest (hedged) is the Citigroup World Government Bond Index hedged into Australian dollars; and • the index for Australian fixed interest is the UBS Australian Composite Bond Index.

The funds do not invest directly in securities in the different asset classes. The funds seek to achieve their investment objectives by investing in a blend of the underlying Vanguard Index Funds listed below in accordance with their target asset allocations: • Vanguard Cash Plus Index Fund; • Vanguard Australian Fixed Interest Index Fund; • Vanguard International Fixed Interest Index Fund (Hedged); • Vanguard International Credit Securities Index Fund (Hedged); • Vanguard Property Securities Index Fund; • Vanguard Australian Shares Index Fund; • Vanguard International Shares Index Fund; • Vanguard International Shares Index Fund (Hedged); • Vanguard International Small Companies Index Fund; • Vanguard International Small Companies Index Fund (Hedged); • Vanguard International Property Securities Index Fund; • Vanguard International Property Securities Index Fund (Hedged); and • Vanguard Emerging Markets Shares Index Fund. Each diversified fund currently achieves its allocation to a particular sector by investing in the underlying fund listed above which has a name correponding to the relevant sector.

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Vanguard Investor Index Funds Product Disclosure Statement

18


Specific fund information

®

®

Vanguard LifeStrategy Conservative Fund Investment objective The fund seeks to match the weighted average return of the target indexes of the underlying funds (as outlined on page 18), before taking into account fund fees and expenses. The weights used are the target allocations to each asset class.

Investment policy This fund’s portfolio is designed to provide investors with a diversified asset allocation that emphasises the historically less risky and lower returning income asset classes over the historically riskier and higher returning growth asset classes.

Asset allocation

Asset allocation Asset class

Growth assets Australian shares

14.7

15.0

13-17

International shares

10.1

10.0

9-11

Australian property securities

1.9

2.0

International property securities (Hedged)

2.0

2.0

1.0

1.0

Emerging markets shares

0.0

0.0

0

29.7

30.0

28-32

10.8

11.0

9-13

Total Growth

0-2

Income assets Australian fixed interest International fixed interest (Hedged)

16.6

17.0

15-19

Australian cash

42.9

42.0

40-44

Total Income

70.3

70.0

68-72

Vanguard may vary the strategic asset allocations and asset allocation ranges or introduce new asset classes from time to time. The following table shows the fund’s actual asset allocations as at 31 October 2007 and the current strategic asset allocations and ranges.

®

3-5

International small companies (Hedged)

The portfolio targets a 30% allocation to growth asset classes (property securities and shares), and a 70% allocation to income asset classes (cash and fixed interest securities). Actual allocations are permitted to deviate from the strategic asset allocations provided they remain within the ranges in the following table.

19

Actual allocation Strategic Asset allocation at 31 October 2007 asset allocation ranges % % %

Vanguard Investor Index Funds Product Disclosure Statement

Fund performance Period ending 31 October 2007 Fund and index returns Fund return (after fees and expenses)

1 year 3 years 5 years % % p.a. % p.a. 8.2

9.0

8.1

Fund return (before fees and expenses)

9.1

9.9

9.1

Index return

8.9

9.8

9.0

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.


®

®

Vanguard LifeStrategy Balanced Fund Investment objective The fund seeks to match the weighted average return of the target indexes of each of the underlying funds (as outlined on page 18) before taking into account fund fees and expenses. The weights used are the target allocations to each asset class.

Investment policy This fund’s portfolio is designed to provide investors with a diversified asset allocation that equally mixes the historically less risky and lower returning income asset classes with the historically riskier and higher returning growth asset classes.

Asset allocation

Asset allocation Asset class

Actual allocation Strategic Asset allocation at 31 October 2007 asset allocation ranges % % %

Growth assets Australian shares

25.1

24.0

22-26

International shares

17.6

17.0

15-19

Australian property securities

2.8

3.0

International property securities (Hedged)

2.9

3.0

International small companies (Hedged)

2.0

2.0

1-3

Emerging markets shares

1.1

1.0

0.5-1.5

51.5

50.0

48-52

10.4

11.0

9-13

Total Growth

5-7

Income assets Australian fixed interest International fixed interest (Hedged)

16.1

17.0

15-19

Australian cash

22.0

22.0

20-24

Total Income

48.5

50.0

48-52

The portfolio targets a 50% allocation to growth asset classes (property securities and shares), and a 50% allocation to income asset classes (cash and fixed interest securities). Actual allocations are permitted to deviate from the strategic asset allocations provided they remain within the ranges in the following table.

Fund performance Period ending 31 October 2007 Fund and index returns

Vanguard may vary the strategic asset allocations and asset allocation ranges or introduce new asset classes from time to time.

1 year 3 years 5 years % % p.a. % p.a.

Fund return (after fees and expenses)

10.4

Fund return (before fees and expenses)

11.4

12.9

n/a

Index return

11.1

12.6

n/a

11.8

n/a

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.

The following table shows the fund’s actual asset allocations as at 31 October 2007 and the current strategic asset allocations and ranges.

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Vanguard Investor Index Funds Product Disclosure Statement

20


Specific fund information

®

®

Vanguard LifeStrategy Growth Fund Investment objective The fund seeks to match the weighted average return of the target indexes of each of the underlying funds (as outlined on page 18) before taking into account fund fees and expenses. The weights used are the target allocations to each asset class.

Investment policy This fund’s portfolio is designed to provide investors with a diversified asset allocation that emphasises the historically riskier and higher returning growth asset classes over the historically less risky and lower returning income asset classes.

Asset allocation Asset class

Growth assets Australian shares

35.9

34.0

32-36

International shares

21.1

23.0

21-25

Australian property securities

4.1

4.0

International property securities (Hedged)

4.0

4.0

3.0

3.0

2-4

Emerging markets shares

2.3

2.0

1.5-2.5

70.4

70.0

68-72

Australian fixed interest

10.9

11.0

9-13

International fixed interest (Hedged)

17.1

17.0

15-19

1.6

2.0

1-3

29.6

30.0

28-32

Total Growth Income assets

Total Income

The portfolio targets a 70% allocation to growth asset classes (property securities and shares), and a 30% allocation to income asset classes (cash and fixed interest securities). Actual allocations are permitted to deviate from the strategic asset allocations provided they remain within the ranges in the following table. Vanguard may vary the strategic asset allocations and asset allocation ranges or introduce new asset classes from time to time. The following table shows the fund’s actual asset allocations as at 31 October 2007 and the current strategic asset allocations and ranges.

21

®

7-9

International small companies (Hedged)

Australian cash

Asset allocation

Actual allocation Strategic Asset allocation at 31 October 2007 asset allocation ranges % % %

Vanguard Investor Index Funds Product Disclosure Statement

Fund performance Period ending 31 October 2007 Fund and index returns Fund return (after fees and expenses)

1 year 3 years 5 years % % p.a. % p.a. 13.0

14.9

12.7

Fund return (before fees and expenses)

14.1

15.9

13.8

Index return

13.6

15.6

13.5

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.


®

®

Vanguard LifeStrategy High Growth Fund Investment objective The fund seeks to match the weighted average return of the target indexes of each of the underlying funds (as outlined on page 18), before taking into account fund fees and expenses. The weights used are the target allocations to each asset class.

Investment policy This fund’s portfolio is designed to provide investors with a diversified asset allocation that heavily emphasises the historically riskier and higher returning growth asset classes over the historically less risky and lower returning income asset classes.

Asset allocation

Asset allocation Asset class

Actual allocation Strategic Asset allocation at 31 October 2007 asset allocation ranges % % %

Growth assets Australian shares

45.7

44.0

42-46

International shares

27.3

29.0

27-31

Australian property securities

5.0

5.0

International property securities (Hedged)

4.9

5.0

International small companies (Hedged)

4.0

4.0

Emerging markets shares

4-6

9-11 2.9

3.0

2-4

89.8

90.0

88-92

Australian fixed interest

4.0

4.0

3-5

International fixed interest (Hedged)

6.2

6.0

5-7

Australian cash

0.0

0.0

0-1

10.2

10.0

8-12

Total Growth Income assets

Total Income

The portfolio targets a 90% allocation to growth asset classes (property securities and shares), and a 10% allocation to the income asset class of fixed interest securities. Actual allocations are permitted to deviate from the strategic asset allocations provided they remain within the ranges in the following table.

Fund performance Period ending 31 October 2007 Fund and index returns Fund return (after fees and expenses)

Vanguard may vary the strategic asset allocations and asset allocation ranges or introduce new asset classes from time to time.

Fund return (before fees and expenses) Index return

1 year 3 years 5 years % % p.a. % p.a. 15.6

18.0

14.9

16.7

19.0

16.0

16.5

18.8

15.7

All fund and index returns assume reinvestment of income and take no account of an individual investor’s tax position. Investors should be aware that past performance is not necessarily an indicator of future returns.

The following table shows the fund’s actual asset allocations as at 31 October 2007 and the current strategic asset allocations and ranges.

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Vanguard Investor Index Funds Product Disclosure Statement

22


Additional information

Fees and other costs DID YOU KNOW? Small differences in both investment performance and fees and costs can have a substantial impact on your long-term returns. For example, total annual fees and costs of 2% of your fund balance rather than 1% could reduce your final return by up to 20% over a 30 year period (for example, reduce it from $100,000 to $80,000). You should consider whether features such as superior investment performance or the provision of better member services justify higher fees and costs. You may be able to negotiate to pay lower contribution fees and management costs where applicable. Ask the fund or your financial adviser.

TO FIND OUT MORE If you would like to find out more, or see the impact of the fees based on your own circumstances, the Australian Securities and Investments Commission (ASIC) website (www.fido.asic.gov.au) has a managed investment fee calculator to help you check out different fee options.

23

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Vanguard Investor Index Funds Product Disclosure Statement


This section shows fees and other costs that you may be charged. These fees and costs may be deducted from your money, from the returns on your investment or from each fund’s assets as a whole. Taxes are set out in another part of this PDS. You should read all the information about fees and costs because it is important to understand their impact on your investment.

Type of fee or cost

Amount

How and when paid

Establishment fee The fee to open your investment.

Nil

Not applicable

Application/contribution fee The fee on each amount contributed to your investment.

Nil

Not applicable

Withdrawal fee The fee on each amount you take out of your investment.

Nil

Not applicable

Termination fee The fee to close your investment.

Nil

Not applicable

Fees when your money moves in or out of the fundsA

Management costsB The fees and costs for managing your investment.

0.35% p.a. – 0.90% p.a.

The amount you pay for specific funds is shown on pages 3 to 5.

The management cost for each fund is calculated as a percentage of the fund’s net asset valueC. The fee is accrued daily and paid monthly. The fee for a month is paid on or after the first day of the following month. This fee is taken from the assets of the relevant fund and/or underlying fund, and is reflected in daily unit prices.

Service fees Investment switching fee The fee for switching between the funds.A A

B C

Nil

Not applicable

You may also incur a buy/sell spread when your money moves in or out of the funds. Please refer to page 28 for an explanation of buy/sell spreads. The amount you pay for a specific fund including worked dollar examples is shown on page 26 of this PDS. Please refer to page 29 for an explanation of the net asset value for the funds.

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Vanguard Investor Index Funds Product Disclosure Statement

24


Example of annual fees and costs The following tables provide examples of how the fees and costs for each of the funds can affect your investment over a one-year period. You should use these tables to compare these products with other managed investment products.

Example Vanguard Index Cash Plus Fund

Balance of $50,000 with a contribution of $5,000 during year

Contribution fees

Nil

PLUS Management costsB First $50,000

Next $50,000 Balance over $100,000

0.70% p.a. 0.50% p.a. 0.35% p.a.

EQUALS Cost of fund

For the first $50,000 you will be charged $350 each year

If you had an investment of $50,000 at the beginning of the year and you put in an additional $5,000A during that year, you would be charged fees of $350

Example Vanguard Index Australian Shares Fund Vanguard Index Diversified Bond Fund Contribution fees

Balance of $50,000 with a contribution of $5,000 during year

Nil

PLUS Management costsB First $50,000

Next $50,000 Balance over $100,000

0.75% p.a. 0.50% p.a. 0.35% p.a.

EQUALS Cost of fund

For the first $50,000 you will be charged $375 each year

If you had an investment of $50,000 at the beginning of the year and you put in an additional $5,000A during that year, you would be charged fees of $375

Example Vanguard High Yield Australian Shares Fund Contribution fees

Balance of $50,000 with a contribution of $5,000 during year

Nil

PLUS Management costsB First $50,000

Next $50,000 Balance over $100,000

0.90% p.a. 0.60% p.a. 0.45% p.a.

EQUALS Cost of fund

For the first $50,000 you will be charged $450 each year

If you had an investment of $50,000 at the beginning of the year and you put in an additional $5,000A during that year, you would be charged fees of $450

Example Vanguard Vanguard Vanguard Fund Vanguard Vanguard Vanguard Vanguard

Index Property Securities Fund Index International Shares Fund Index Hedged International Shares LifeStrategy LifeStrategy LifeStrategy LifeStrategy

Conservative Fund Balanced Fund Growth Fund High Growth Fund

Contribution fees

Balance of $50,000 with a contribution of $5,000 during year

Nil

PLUS Management costsB First $50,000

Next $50,000 Balance over $100,000 EQUALS Cost of fund

0.90% p.a. 0.60% p.a. 0.35% p.a.

For the first $50,000 you will be charged $450 each year

If you had an investment of $50,000 at the beginning of the year and you put in an additional $5,000A during that year, you would be charged fees of $450

Assumes that the $5,000 investment occurs on the last business day of the year. Refer to page 27 for details of how the the lower fees apply for balances over $50,000. You may incur a buy/sell spread when your money moves in and out of the Funds. Please refer to page 28 for an explanation of the buy/sell spreads.

A

B

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Vanguard Investor Index Funds Product Disclosure Statement

26


Additional information

Additional explanation of fees and costs Management costs The management costs for the funds incorporate all relevant fees and other costs involved in managing the funds and deriving investment returns, other than transaction and operational costs. They include: • responsible entity/manager’s fees; • custodian fees (excluding transaction based fees); • accounting and audit fees; • the management cost for the underlying funds; and • any other recoverable expenses under the constitutions of the funds such as the cost of preparing and amending the constitutions, the cost of producing the PDS, the cost of investor meetings, postage and other fund administration expenses (other than transactional and operational costs). The management costs for the investment options incorporate Goods and Services Tax (GST) after taking into account any expected input tax credits. The management costs of investing in the funds are capped while this PDS is current. In calculating taxable income for the funds, all available tax deductions are taken into account. This means that the effective after-tax cost to investors of investing in a fund may be lower than the amounts specified on pages 3 to 5 to the extent that management costs are a tax deductible expense and reduce the taxable income of that fund. Please refer to page 35 for more information on taxation.

Management fee rebates As detailed on pages 3 to 5, if you invest more than $50,000 in a fund, the management costs will be calculated at the lower rate for that part of your investment which exceeds $50,000. You should note that the management costs will initially be deducted on the basis of the higher management costs for each fund. The difference will then be credited to you as a rebate automatically reinvested in units in the same fund. Eligible investors in the Vanguard Index Cash Plus Fund, Vanguard Index Diversified Bond Fund and the Vanguard High Yield Australian Shares Fund will receive their management fee rebate soon after 31 December, 31 March, 30 June and 30 September distributions. Investors in the remaining Vanguard Investor Index Funds will receive their management fee rebate soon after 31 December and 30 June distributions. The rebate will usually be credited into your account within 15 business days. If you withdraw from a fund prior to the management rebate being applied, Vanguard will credit the management

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fee rebate to the most recently advised Australian bank account details. However, if you have withdrawn your investment and the management fee rebate is less than $50, Vanguard reserves the right to withhold the rebate. It is currently not possible to have the rebate paid to an Australian bank account unless you have withdrawn from the Funds. There may be tax implications with the payment of the management fee rebate. Please refer to the section on Taxation of the funds on pages 35 and 36.

Transaction and operational costs In addition to the management costs, there are other costs incurred by the funds that are an additional costs to investors. They include government taxes and charges, regulatory fees and charges, bank charges, and transaction costs. Most of these costs would also be incurred by investors acting directly on their own account. The most significant of these costs are transaction costs brokerage commission, buy/sell spreads in underlying securities and, in some markets, stamp duty. Such costs arise whenever the funds buy or sell assets to invest application monies, meet withdrawals or from “maintenance” trading activity, which maintain their portfolios in line with their investment objectives. The buy/sell spreads – see the discussion below – protect ongoing investors from the transaction activity driven by applications and withdrawals. Due to the very low turnover inherent in index funds, the transaction costs arising from ‘maintenance’ activity has been and is expected to be less than 0.05% per annum (of net asset values) for all funds except those with currency hedging where the expectation is less than 0.15% per annum. The costs are deducted from the assets of the relevant fund (or underlying fund) when they are incurred and are reflected in unit prices.

Notification of changes to fees The management costs include a management fee component which is Vanguard’s remuneration for managing the funds, and expense reimbursement component. The constitutions governing each fund limit the amount of the management fee component. The management fee component for the Vanguard High Yield Australian Shares Fund cannot be increased above 1.5% per annum. The management fee component for the Vanguard LifeStrategy Balanced Fund and the Vanguard Index Hedged International Shares Fund cannot be increased above 0.90% per annum. The management fee component for the other Funds cannot be increased above 0.85% per annum. Note that these limits are exclusive of GST.

Vanguard Investor Index Funds Product Disclosure Statement


A further fee of up to $50 per annum may be introduced for all of the Funds except the Vanguard LifeStrategy Balanced Fund and the Vanguard High Yield Australian Shares Fund but not during the life of this PDS.

The purpose of the buy/sell spread is to protect investors from the costs generated by the transaction activity of other investors. Investors who invest into a fund will pay the purchase price calculated by adding the buy spread to the fund’s net asset value per unit. Investors who withdraw from a fund will receive the withdrawal price calculated by deducting the sell spread from the fund’s net asset value per unit. The buy/sell spreads are detailed in the table below.

An early withdrawal fee may be introduced. The early withdrawal fee for the Vanguard High Yield Australian Shares Fund could not exceed $50 per withdrawal or 0.5% of the withdrawal price (whichever is the greater) for each unit redeemed. The early withdrawal fee for the other Funds could not exceed the greater of $50 or 0.5% of the net asset value of each unit redeemed (i.e. the withdrawal price plus the sell spread). Note that an early withdrawal fee could be charged in relation to any redemption of units in the Vanguard High Yield Australian Shares Fund. However, an early withdrawal fee could only be charged in relation to the other funds where units are redeemed within 180 days after being purchased.

There is currently no buy/sell spread applied to the withdrawal or purchase price of the Vanguard Index Cash Plus Fund.

Changes to buy/sell spreads Investors will generally be given 30 days’ prior notice of any increases in the buy/sell spreads or the introduction of a buy/sell spread for the Vanguard Index Cash Plus Fund. Vanguard may increase buy/sell spreads without notice when that is necessary to protect the interests of existing investors and if permitted by law.

There are currently no early withdrawal fees charged for any of the funds in this PDS.

What is paid to your adviser? No adviser will receive any commission from Vanguard relating to your investment in the funds. Vanguard may offer a facility to enable you to arrange for your adviser to be paid an agreed fee, from your investment, for services provided.

Vanguard currently does not intend to increase existing fees or introduce new fees. At least 30 days’ prior notice will be given to unitholders before any fee increase or the introduction of a new fee takes effect.

Buy/sell spread The buy/sell spread for each fund is Vanguard’s reasonable estimate of the transaction costs that the fund will incur when buying and selling assets to invest application monies and meet withdrawals. The buy/sell spreads are paid to the funds to meet these expenses and are not received by Vanguard.

Buy/sell spreads for the funds %

Buy spread Dollar example on investment of $5,000

%

Sell spread Dollar example on withdrawal of $5,000

0.20

$10

0.10

$5

Asset Sector Investor Index Funds Vanguard Index Australian Shares Fund Vanguard High Yield Australian Shares Fund

0.20

$10

0.10

$5

Vanguard Index International Shares Fund

0.30

$15

0.10

$5

Vanguard Index Hedged International Shares Fund

0.35

$17.50

0.15

$7.50

Vanguard Index Property Securities Fund

0.20

$10

0.20

$10

Vanguard Index Diversified Bond Fund

0.15

$7.50

0.15

$7.50

Nil

n/a

Vanguard LifeStrategy Conservative Fund

0.15

$7.50

0.10

$5

Vanguard LifeStrategy Balanced Fund

0.20

$10

0.15

$7.50

Vanguard LifeStrategy Growth Fund

0.25

$12.50

0.15

$7.50

Vanguard LifeStrategy High Growth Fund

0.30

$15

0.20

$10

Vanguard Index Cash Plus Fund

Nil

n/a

Diversified Investor Index Funds

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Vanguard Investor Index Funds Product Disclosure Statement

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Additional information

Your guide to investing Valuations and pricing

Applications

The net asset value per unit is determined by dividing the net asset value of a fund by the number of units on issue in the fund at the time of valuation (the valuation point). The net asset value for a fund is the value of assets of that fund, less liabilities of that fund. A valuation point for a fund is generally the close of business on a particular day in relevant markets.

A minimum of $5,000 is required for the initial investment into each fund. Vanguard, at its discretion, may accept other application amounts.

The prices are calculated as follows:

Applications must be received by the prescribed time – 2:00pm Melbourne time on a business day, except where otherwise determined by Vanguard – to be processed at the purchase price to be applied for that day. The unit price applicable for that day will not be known until the next business day. Units are issued at the purchase price calculated at the next valuation point after acceptance of your application.

Purchase price

= net asset value per unit plus the buy spread

Withdrawal price = net asset value per unit minus the sell spread

An application for units in the Vanguard Investor Index Funds must be made by completing the Application for Investment Form attached to this PDS.

The buy/sell spread is explained on page 28.

Impact of significant market events on unit pricing Vanguard does not price the units on public holidays or when markets are closed in relevant countries or where there are other factors preventing the accurate calculation of the unit prices.

Applications received after the prescribed time will be processed at the applicable purchase price as if they have been received on the next business day. Vanguard reserves the right to refuse any investment application.

Making additional investments Applications or withdrawals for the affected fund/s, which are received on these days or after the cut-off time on the previous day, will be processed as if they had been received on the business day following the affected dates. Changes to the cut-off times will be published on the website at www.vanguard.com.au. You should check the website if you are contemplating a transaction.

Obtaining Vanguard unit prices For information on unit prices visit www.vanguard.com.au or contact Client Services on 1300 655 101. Investors who buy units in a fund before a distribution date should be aware that the price will include income accumulated in the fund since the last income distribution was made. This income will subsequently be distributed and will form part of an investor’s taxable income. After a distribution, this unit price may drop to reflect the distribution paid.

Standard Forms Investors must use Vanguard Standard Forms when issuing us with transaction instructions – otherwise we will not process your instructions. You can download Vanguard’s Standard Forms at www.vanguard.com.au/Personal_Investors or contact Client Services on 1300 655 101 to find out more about how to transact with Vanguard.

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If you are an existing Vanguard investor, and wish to add to a fund in which you have already invested, or invest in a new fund, you can expand your portfolio by: • using BPAY; or • completing an Additional Application for Investment Form and attaching a cheque. You can access Additional Application for Investment Forms by visiting www.vanguard.com.au/Personal_Investors or contacting Client Services on 1300 655 101. The PDS may be replaced or updated from time to time. A copy of the most up-to-date PDS (including any supplementary PDS) will be sent free of charge upon request. Alternatively you can download a copy by visiting www.vanguard.com.au/Personal_Investors or request a copy from Client Services on 1300 655 101. The minimum amount for additional investments into an existing fund is $1,000. This is reduced to $100 if using BPAY. The minimum amount for each new fund is $5,000. ®

Using BPAY

BPAY allows you to transfer money from your bank account to your existing Vanguard account 24 hours a day, seven days a week.

Vanguard Investor Index Funds Product Disclosure Statement


Once Vanguard has set up your investor number, you can use this service for your initial investment or to add to your existing investment. Using your bank’s BPAY service, you simply make additional investments by telephone or via their internet banking services without the need for another application form. Please note that even though your BPAY transaction is processed from your bank account immediately, your funds and payment instructions may take some time to be transferred to Vanguard from your financial institution. Provided your BPAY request is made before your financial institution’s cut-off time (usually 5.00 pm Melbourne time), Vanguard would typically receive your funds before 2.00pm (Melbourne time) on the following business day. Units will only be issued once we receive your funds and will be issued at the unit price applicable to the day payment is received. Additional investments to a fund will be issued according to the terms and conditions of the current Vanguard Investor Index Funds PDS and the constitution of the fund. BPAY transactions cannot generally be reversed. Payments using credit card accounts cannot be made via BPAY. Any query on a BPAY transaction should be directed to your bank.

Withdrawals You may withdraw part or all of your investment at anytime. You can access the current Withdrawal Form by visiting www.vanguard.com.au/Personal_Investors or contacting Client Services on 1300 655 101. Withdrawals must be received by the prescribed time – 2:00pm Melbourne time on a business day, except where otherwise determined by Vanguard – to be processed at the withdrawal price to be applied for that day. The unit price applicable for that day will not be known until the next business day. Units are withdrawn at the withdrawal price calculated at the next valuation point after receipt of your withdrawal request. Withdrawals received after the prescribed time will be processed at the applicable purchase price as if they have been received on the next business day.

Please note that withdrawal payments cannot be made to third parties. The minimum withdrawal amount is $1,000 for each fund. The minimum account balance is $3,000 for each fund. If your withdrawal request takes your fund balance below the minimum ($3,000) we reserve the right to treat your request as a full withdrawal from that fund. Vanguard will normally remit withdrawal proceeds within seven business days. In the case of the Vanguard High Yield Australian Shares Fund, Vanguard Index Hedged International Shares Fund and Vanguard LifeStrategy Balanced Fund withdrawals of over 5% of the fund/s value may be processed progressively over a period of up to 20 business days, at the withdrawal price applicable for each day on which a withdrawal is processed. Withdrawals can be suspended in exceptional circumstances, subject to the constitutions of the funds. While a fund is liquid, for the purposes of the Corporations Act 2001, if you make a withdrawal request, Vanguard must redeem your units in accordance with the relevant fund’s constitution. A fund is liquid if 80% of the value of the fund’s assets comprise of liquid assets as defined in the Corporations Act 2001. If a Fund is illiquid, a withdrawal request must be dealt with in accordance with the fund’s constitution and Corporations Act 2001. You may not be able to withdraw your investment in a timely manner if a fund is illiquid. It is not expected that any of the funds in this PDS will be illiquid. On withdrawal of units, Vanguard may deduct, from any amount to be paid to an investor, any amount due by the investor to Vanguard. Withdrawing units may give rise to tax consequences and it is recommended that you check the tax implications with your tax adviser before withdrawing.

Switching You may request that Vanguard switch all or part of your investment between funds.

Withdrawal proceeds are paid in Australian dollars and will normally be remitted within five business days.

To access the current Switching Form visit www.vanguard.com.au/Personal_Investors or contact Client Services on 1300 655 101.

Withdrawal proceeds may be paid either: • to your nominated Australian bank account; or • by cheque payable to you.

A switching request must be received by the prescribed time – 2:00pm Melbourne time on a business day except where otherwise determined by Vanguard – to

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Vanguard Investor Index Funds Product Disclosure Statement

30


Additional information

be processed at the applicable withdrawal and purchase prices to be applied for that day. The unit price applicable for that day will not be known until the next business day.

funds (if any) will be paid as follows:

When you request a switch, we will withdraw your existing units in the fund at the next available withdrawal price and will use the proceeds to buy units in the new fund at the applicable purchase price. The normal buy/sell spread will apply to switch transactions. Switching requests received after the prescribed time will be processed at the applicable withdrawal and purchase price as if they had been received on the next business day. The minimum switch amount is $1,000 for each fund or $5,000 if you are not currently an investor in which you are switching to. If the switch would cause your investment in a fund to fall below $3,000, we reserve the right to treat your instruction as an instruction to switch your full investment in that fund. Switching from one fund to another may give rise to tax consequences and it is recommended that you check the tax implications with your tax adviser before switching.

Transfers Investors may transfer units to another person if that person is eligible to be an investor in the fund. However, Vanguard may, at its sole discretion, refuse to register a transfer of units. To discuss what is required for a transfer, please contact Client Services on 1300 655 101. Transfers must be received by the prescribed time – 2:00pm Melbourne time on a business day except where otherwise determined by Vanguard – to be processed at the net asset value per unit to be applied for that day. The unit price applicable for that day will not be known until the next business day. Transfers received after the prescribed time will be processed at the applicable net asset value per unit as if they had been received on the next business day. Transferring units may give rise to tax consequences and it is recommended that you check the tax implications with your tax adviser before transferring.

Fund

Distribution frequency

Vanguard High Yield Australian Shares Fund

Last day of each month

Vanguard Index Cash Plus Fund Vanguard Index Diversified Bond Fund

Quarterly as at 31 March, 30 June, 30 September and 31 December

Vanguard Index Australian Shares Fund Vanguard Index International Shares Fund Vanguard Index Hedged International Shares Fund Vanguard Index Property Securities Fund Vanguard LifeStrategy Conservative Fund Vanguard LifeStrategy Balanced Fund Vanguard LifeStrategy Growth Fund Vanguard LifeStrategy High Growth Fund

Half yearly as at 31 December and 30 June

Distributions are calculated in cents per unit and will be paid to investors based on the number of units held as at the end of the distribution period. This means that, for example, if the number of units on issue increases before the end of a distribution period, this may decrease the level of distributable income per unit that might otherwise have been payable. All distributions will normally be paid within 15 business days after the distribution dates. Please note, there may be periods when a fund will not pay a distribution. If this should occur then details will be available on www.vanguard.com.au. You may choose to have your distribution of income: • reinvested in additional units in the same fund; or • paid directly to a nominated Australian bank account. If you do not make a distribution choice, income will automatically be reinvested in additional units in the fund. Where your distribution of income is reinvested in the fund, the units you receive will be issued to you without a buy spread being added to the price you pay for those units. For details on taxation of income distributions, see page 35.

Vanguard reserves the right to decline to register a transfer of units.

Please note that Vanguard reserves the right to reinvest any distributions following the death of the investor even if the investor or their representative requests for their distributions to be credited to an Australian bank account.

Income distributions

What information will I receive?

Each of the funds may earn income, such as dividends and interest. The funds may also realise capital gains or losses on the sale of investments. Income and net realised capital gains will be distributed to investors. Distributions for the

The funds are disclosing entities and are subject to regular reporting and disclosure obligations. Copies of documents lodged with ASIC in relation to the funds may be obtained from, or inspected at, an ASIC office.

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Vanguard Investor Index Funds Product Disclosure Statement


Vanguard can also provide you with a copy (free of charge) of: • the Annual Financial Report most recently lodged with ASIC for each fund; • any half-yearly fund financial reports lodged with ASIC in relation to a fund; and • any continuous disclosure notices given for a fund after the lodgment of an annual report.

Transaction confirmations

Confirming initial and subsequent investments and any withdrawal, switch or transfer of investments (including details of units involved, price and date).

Vanguard Compass

A booklet containing instructions on how to contact Vanguard, make additional investments and access account and investment information.

Personal Identification Number (PIN) To provide you with access to your personal account details 24 hours a day, 7 days a week via our online facility, Vanguard Online, which can be accessed via www.vanguard.com.au. Quarterly Transaction Statements

Setting out the number of units held, the unit withdrawal price and the current value of your investment.

Income Distribution Statements

Issued quarterly for the Vanguard High Yield Australian Shares Fund, the Vanguard Index Cash Plus Fund and the Vanguard Index Diversified Bond Fund. Income Distribution Statements are issued half-yearly for all other funds. For investors in the Vanguard High Yield Australian Shares Fund, transaction confirmations of your monthly income reinvestments are provided on Vanguard Online and they are also reflected in your quarterly Income Distribution Statements.

Annual Report

Includes the audited accounts of the funds as at 30 June.

Annual Tax Statement

Issued after each 30 June, to assist you in preparing your tax return.

Annual Capital Gains Tax Statement Issued after 30 June, if you have withdrawn, switched or transferred units during the period. Helm

A quarterly newsletter.

Fund Fact Sheets

Incorporating fund returns and unit prices (available upon request or visit www.vanguard.com.au).

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Vanguard Investor Index Funds Product Disclosure Statement

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Additional information

Vanguard Online Vanguard Online allows Vanguard investors access to the following functions:

Investment summary

This provides you with the latest balance (or value) of your investments with Vanguard. In addition, you can review the status of each of your funds which includes, the date the fund was priced, number of units held, and the unit price of the fund.

Transaction history

Provides the last 20 transactions for your investments including, the date and type of transaction, the number of units transacted, the unit price and total value of the transaction, and the total number of units held in the fund.

Statement information

Allows you to view and print your current statements.

Mailbox

A direct link from your account to Vanguard Client Services. This enables you to update your personal details, receive updates, ask questions or receive feedback.

Vanguard’s website: www.vanguard.com.au By visiting the Vanguard website you can obtain additional up-to-date information about the funds as well as access to a range of educational tools. Information available includes: • monthly performance summaries for each fund • after-tax reporting for all funds • monthly fund fact sheets • fund profiles • Standard Forms (including Change of Details, Switching, Additional Application and Withdrawal forms) • Tools and education – a key education centre with a range of tools including: investment Plain Talk guides, fee calculators, an investor risk questionnaire and much more.

Annual report options You may choose your preferred mode of receiving the annual report when completing the Application for Investment Form. You can choose to receive a mailed copy of the annual report or you can elect to receive an e-mail notifying you when the report becomes available at Vanguard Online. Alternatively, you can tell us that you do not want to receive the report at all.

(d) does not take responsibility for any fraudulently or incorrectly completed facsimile instructions; and (e) will not compensate you for any losses relating to facsimiles, unless required by law. For example, you bear the risk that a facsimile may be sent by someone who knows your account details. In the event of fraud you agree to release, discharge and indemnify Vanguard from and against all actions, claims, demands, expenses and liabilities (however they arise) suffered by you or suffered by or brought against Vanguard, in respect of the facsimile instructions, to the extent permitted by law.

Obtaining the latest PDS A copy of the latest PDS for the funds is available on Vanguard’s website (www.vanguard.com.au). If you do not have access to the internet, please contact Vanguard Client Services on 1300 655 101. A paper copy will be provided free of charge on request.

If you require more information, visit www.vanguard.com.au or contact Client Services on 1300 655 101 between the hours of 8:00am and 6:00pm, Melbourne time, Monday to Friday.

Facsimile instructions If you are advising Vanguard via facsimile in respect of instructions (including applications, withdrawals and switching requests) it is important to be aware that Vanguard: (a) will only process your facsimile instructions if it is received in full and has been signed by authorised signatories; (b) is not responsible for any loss or delay that results from a facsimile transmission not being received by Vanguard; (c) will not accept a facsimile receipt confirmation from the sender’s facsimile machine as evidence of receipt of the facsimile;

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Vanguard Investor Index Funds Product Disclosure Statement


Additional information

Taxation of the funds The taxation information in this PDS is provided for general information only. Vanguard does not provide tax advice. As each investor’s circumstance is different, you should obtain professional tax advice concerning the particular tax implications for you. Discussion of tax in this PDS refers to Australian taxation laws current at the time of publication, which may change.

A fund may make distributions of amounts which are nonassessable. Receipt of certain non-assessable amounts may have capital gains tax consequences. To the extent that certain amounts distributed are non-assessable as a result of the capital gain concession, no adjustment to the cost base of your units will be required.

Other gains Taxation of Australian resident investors Distributions from the fund The distributable income of the funds for each financial year is allocated to investors during the financial year. The taxable income of the funds to which you become entitled during a financial year (including reinvested income) forms part of your assessable income for that year even though payment may not occur until some time later. The taxable income will also include any management fee rebate that you receive from a fund during the year. The tax impact for you depends upon the components of the distributions.

Dividends For each of the funds which invest in Australian equities, your share of the fund’s distributable income may include an entitlement to franking credits. These amounts are not cash receipts but will need to be included in your calculation of taxable income in your tax return and, depending on your particular circumstances, may be available to offset your tax liability, or be paid as a refund if the franking credits exceed your total tax liability.

Gains and losses in relation to investments of certain funds, including foreign currency gains arising from the investment of the funds, may be assessed as income under provisions other than the capital gains tax provisions of the Income Tax Assessment Act. In some cases, the amount may be recognised for tax purposes before the relevant gain or loss is realised.

Disposal of units Investors may be liable for tax on gains realised on the disposal of units in any of the funds. Disposal of units may be in the form of a withdrawal, a switch between funds or a transfer of units. Under the capital gains tax provisions, any taxable capital gain arising on disposal of your units may form part of your assessable income. Some investors may be eligible for the capital gain concession upon disposal of their units if the units are held for 12 months (or more) and the fund satisfies certain requirements. You should obtain professional advice about the availability of the concession.

Foreign income Income received by a fund from sources outside Australia may be subject to taxation in the country of source. Australian resident investors may be entitled to claim a credit against their Australian tax liability in respect of their share of the foreign tax paid.

Foreign Investment Fund (FIF) regime The underlying funds may include investments in certain foreign companies and foreign trusts to which the FIF regime may apply. Under the FIF regime, you may be assessed on your portion of gain in the value of interests in certain foreign companies and foreign trusts that a fund holds at the end of the tax year, even though those gains are unrealised. However, the underlying funds are unlikely to hold FIF assets in excess of the threshold at which the FIF regime applies. Vanguard will notify investors upon the distribution of any gains to which the FIF regime applies.

Capital gains Taxable capital gains derived by the funds to which you become entitled may form part of your assessable income.

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Any capital loss arising on a disposal of units may be able to be offset against capital gains arising in that year or subsequent years. Certain investors (for example, those carrying on a business of trading in units) may be assessed to tax on any gains made on the disposal of units under provisions other than the capital gains tax rules. Investors should seek professional advice about the capital gains tax treatment of their units in the fund.

Quoting your Tax File Number (TFN) or TFN exemption or Australian Business Number (ABN) Collection of your TFN is authorised and its use and disclosure are strictly regulated by the tax laws and the Privacy Act 1988. You may quote a TFN or claim a TFN exemption in relation to your investment in a fund when completing your Application for Investment Form. If you choose not to quote a TFN or TFN exemption, Vanguard will be required to deduct tax at the prescribed rate (at the date of this PDS this was the highest marginal rate plus Medicare Levy) from your income distributions.

Vanguard Investor Index Funds Product Disclosure Statement


You may quote your ABN instead of a TFN if you are making this investment in the course of an enterprise carried on by you.

Social security Investing in the funds may affect your social security entitlements because your investment may be included in the income and assets tests of Centrelink and the Department of Veterans’ Affairs. You should obtain professional advice concerning your particular social security implications.

Goods and Services Tax (GST) The issue and withdrawal of units in the funds will not be subject to GST. However, fees and expenses incurred by the funds, such as management costs, will attract GST at the rate of 10%. Given the nature of the funds’ activities, the funds will not be entitled to claim input tax credits for the full amount of the GST incurred. However, for the majority of the expenses, a Reduced Input Tax Credit (RITC) of 75% of the GST paid can be claimed. The GST and expected RITC relating to fees and expenses is incorporated in the management cost for each fund.

Taxation of non-resident investors Vanguard is required to deduct Australian tax on certain components of income distributions. Upon lodging an Australian tax return, investors may obtain (depending on their circumstances) a refund or a tax credit for the tax paid. Vanguard is also required to deduct withholding tax on certain payments. Vanguard will deduct the relevant tax amounts from the distribution payments to which the tax liabilities relate. Generally, a non-resident investor will not be liable for Australian capital gains tax in respect of disposal of their units in the funds, if the funds and the non-resident investor satisfy certain requirements at the time of disposal. It is very important that non-resident investors seek independent tax advice before investing, taking into account their particular circumstances and the provisions of any relevant Double Tax Agreement between Australia and their country of residence.

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Vanguard Investor Index Funds Product Disclosure Statement

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Additional information

Other information you need to know Vanguard as the responsible entity Vanguard, as the responsible entity, is solely responsible for the management and administration of the funds. Vanguard holds an Australian Financial Services Licence (AFSL 227263) that authorises it to act as the Responsible Entity of the funds. The powers and duties of Vanguard are set out in the constitutions, the Corporations Act 2001 and general trust law. The duties of Vanguard under the Corporations Act 2001 include: • acting in the best interests of investors and, if there is a conflict between investors’ interests and Vanguard’s interests, giving priority to investors’ interests; • ensuring that fund property is clearly identified as fund property and held separately from property of Vanguard and property of any other fund and is valued at regular intervals; • ensuring that payments out of fund property are made in accordance with the Corporations Act 2001; and • reporting to the Australian Securities and Investments Commission (ASIC) any significant breach of the Corporations Act 2001 in relation to a fund which has had, or is likely to have, a materially adverse effect on the interests of investors. Vanguard is liable for its actions and the actions of its agents engaged in connection with a fund.

The constitution Each fund is a managed investment scheme governed by a constitution. Under the constitution, Vanguard has all the powers of a natural person in respect of the funds. The constitution for each fund sets out the rights of investors and the obligations of Vanguard as Responsible Entity of the fund. This PDS outlines some of the more important provisions of the constitution. A copy of any of the fund constitutions may be inspected by investors at Vanguard’s office, during business hours. Vanguard will provide investors with a copy of the required constitution upon request.

Amendments to the constitution Vanguard may amend the constitution of each fund from time to time, subject to the provisions of the constitution and the Corporations Act 2001. Generally Vanguard can only amend the constitution where Vanguard reasonably believes that the change will not adversely affect your rights as an investor. Otherwise the constitution can only be amended if approved at a meeting of unitholders.

The compliance plan Vanguard has prepared and lodged a compliance plan for each fund with ASIC. The compliance plan sets out the key criteria that Vanguard will follow to ensure that it is

37

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complying with the Corporations Act 2001 and the funds’ constitution. Each year the compliance plan is independently audited, as required by the Corporations Act 2001, and the auditor’s report is lodged with ASIC.

The compliance committee Vanguard is required to, and has, established a compliance committee with a majority of members that are external to Vanguard. The compliance committee’s functions include: • monitoring Vanguard’s compliance with the compliance plan and reporting its findings to Vanguard; • reporting breaches of the Corporations Act 2001 or the Constitution to Vanguard; • reporting to ASIC if the committee is of the view that Vanguard has not taken or does not propose to take appropriate actions to deal with breaches reported to the committee; and • assessing the adequacy of the compliance plan, recommending any changes and reporting these to Vanguard.

Applications for units Vanguard may, in its absolute discretion, accept or refuse to accept in whole or in part any application or subscription for units. Vanguard need not give any reason for refusal. If for any reason Vanguard refuses or is unable to process your application to invest in the funds, Vanguard will return your application money to you. You will not be entitled to interest on your application money in this circumstance.

Unit pricing policy Vanguard has documented its policy in relation to various discretions that affect unit pricing within our managed funds. The policy has been designed to meet the new Australian Securities and Investments Commission (ASIC) requirements and is available on request to all investors and prospective investors at no charge. The policy explains our approach in relation to buy/sell spreads, valuation methodology, rounding of decimal places, cut-off times for receiving instructions and the frequency of income distributions and unit pricing discretions generally. Contact Client Services on 1300 655 101 if you require a copy of the policy.

Cooling-off period Investors have the right to a ‘cooling off’ period of 14 days. The 14 day period commences from the earlier of the time your investment is confirmed by Vanguard and the fifth day after the units were issued. During this period, you may request in writing to Vanguard the repayment of your investment. The amount returned to investors under the coolingoff provisions may be less than the amount invested. It will

Vanguard Investor Index Funds Product Disclosure Statement


be calculated using the unit withdrawal price applied for the day your withdrawal is processed and may be reduced by any tax or duty paid or payable by you in relation to the acquisition and termination of your investment.

Investment objectives and policy Vanguard may from time to time vary the investment objective and policy of any fund. Such variations may include changes to the target index chosen for each fund or asset class or changes to the asset allocations for the LifeStrategy funds.

Limitation of liability of investors The funds’ constitutions provide that the liability of each investors is limited to its investment in a fund and that an investor is not required to indemnify Vanguard or a creditor of Vanguard against any liability of Vanguard in respect of a fund other than amounts which relate specifically to the particular investor, such as taxes. However, no complete assurance can be given in this regard, as the ultimate liability of an investor has not been finally determined by the courts.

Proxy voting Rights of an investor

The terms and conditions of the funds’ constitutions are binding on each investor in the relevant fund and all persons claiming through them respectively as if the investor or person were a party to the constitutions.

Vanguard votes proxies in companies/funds where the funds or underlying funds (as the case may be) have a significant economic interest, and it is reasonably practicable to do so. This covers the vast majority of holdings by value. Vanguard believes the right to vote proxies for holdings is a significant asset. Vanguard exercises the votes with the goal of maximising the value of the investments. Details of Vanguard’s proxy voting policy can be found at the Vanguard website (www.vanguard.com.au).

Reimbursement of expenses

Meeting of investors

In addition to any other right of indemnity, which Vanguard may have under the funds’ constitutions or at law, Vanguard is indemnified and entitled to be reimbursed out of, or paid from, the assets of each of the funds for all losses, damages and costs incurred in the course of its office or in the administration or management of a particular fund (other than if it is incurred by the Manager’s fraud, negligence or breach of trust). Without limitation, this includes amounts payable in properly performing any of its duties or exercising any of its powers.

Vanguard may convene a meeting of investors of a fund at any time. Examples of circumstances where meetings may be called include to approve certain amendments to the funds’ constitutions or to wind up the fund. Investors also have limited rights to call meetings and have the right to vote at investor meetings.

A unit confers a beneficial interest on an investor in the assets of the fund but not an entitlement or interest in any particular part of the fund or any asset.

Public register of alternative remuneration As a member of the Investment and Financial Services Association, Vanguard is obliged to keep a public register that details any alternative form of remuneration that has been paid to or by Vanguard worth more than $300 (for example, to advisers). You may request a copy from Client Services on 1300 655 101.

Retirement of Vanguard Vanguard may retire as manager of a fund by calling an investors’ meeting to enable investors to choose a company to be the new manager. Vanguard may be removed from office by an extraordinary resolution (i.e. 50% of units that can be voted) passed at a meeting of investors, in accordance with the Corporations Act 2001.

Termination Vanguard may wind up a fund at any time on giving three months’ notice. Following winding up, the net proceeds will be distributed to investors.

Except where the funds’ constitutions provide otherwise or the Corporations Act 2001 requires otherwise, a resolution of investors must be passed by investors who hold units exceeding 50% in value of the total value of all units held by investors who vote on the resolution. A resolution passed at a meeting of investors held in accordance with a fund’s constitution binds all investors of that fund.

Indemnities and limitation of liability of Vanguard In general, Vanguard may act on the opinion of, advice of and information obtained from, advisers and experts. In those cases, Vanguard is not liable for anything done in good faith in reliance on that opinion, advice or information. Vanguard is indemnified out of the fund against any expenses, loss, costs, damages and liabilities that may be incurred in properly performing any of its duties or prosecuting or defending any action or suit in connection with the funds (other than if it arises out of Vanguard’s fraud, neglect or breach of trust). Vanguard is not liable personally to investors or other

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Vanguard Investor Index Funds Product Disclosure Statement

38


Additional information

persons for failing to act except in the case of fraud, negligence or breach of trust.

Borrowings A Fund will only borrow where Vanguard believes it is in the best interests of investors to do so.

If you have a complaint If you have a complaint regarding any of the funds or services provided by Vanguard please contact Client Services on 1300 655 101 from 8:00am to 6:00pm Melbourne time, Monday to Friday. If your complaint is not resolved to your satisfaction within three business days you can refer the matter in writing to: Manager Client Services Vanguard Investments Australia Ltd GPO Box 3006FF Melbourne Vic 3001 Vanguard will try to resolve the complaint and get back to you as soon as possible but in any event within 45 days after we receive the written complaint. In the event that you are not satisfied with the outcome of your complaint, you have the right to refer the matter to an external complaints resolution scheme. Vanguard is a member of the Financial Industry Complaints Services Limited (FICS). You can contact FICS on 1300 780 808.

Vanguard may provide your personal information to its service providers for certain related purposes (as described under the Privacy Act 1988) such as account administration and the production and mailing of statements. Vanguard may also use your personal information and disclose it to its service providers to improve customer service (including companies conducting market research) and to keep you informed of Vanguard’s products and services, or to your financial adviser or broker (as noted on the Application for Investment Form) to provide you with financial advice and ongoing service. If you do not provide the information requested in the Application for Investment Form, Vanguard will not be able to process or accept your application. We will assume you consent to your personal information being used for the purposes of providing information to you on services offered by Vanguard and being disclosed to market research companies for the purposes of analyzing Vanguard’s investment base unless you tell us otherwise. To obtain a copy of the privacy policy or to access or update your personal information, visit www.vanguard.com.au, contact Client Services on 1300 655 101, or write to GPO Box 3006FF, Melbourne, Vic 3001.

Environmental, social and ethical considerations Vanguard does not take into account labour standards or environmental, social or ethical considerations when selecting, retaining or realising investments.

Privacy policy Privacy laws regulate, among other matters, the way organisations collect, use, disclose, keep secure and give people access to their personal information. Vanguard is committed to respecting the privacy of your personal information. Vanguard’s privacy policy states how Vanguard manages personal information. Vanguard collects personal information in the Application for Investment Form, and may collect additional personal information in the course of managing your investment in order to provide this product to you and to establish and manage your investment account in the funds. Some information must be collected for the purposes of compliance with the Anti-Money Laundering and Counter-Terrorism Financing legislation. Vanguard may provide your personal information to your financial adviser if you provide us with written consent to do so. Vanguard may disclose your personal information to authorities investigating criminal or suspicious activity and to the Australian Transaction Reports and Analysis Centre (AUSTRAC) in connection with anti-money laundering and counter-terrorism financing.

39

®

Staying up to date The information contained in this PDS is up to date at its preparation. However, information can change from time to time, for example, fees or the investment strategy of a particular Fund. Before sending your Application for Investment Form you should ensure that you have a current PDS. Vanguard will issue a supplementary or replacement PDS if there is a material adverse change of information in this PDS, or a material adverse omission from the PDS. For up-to-date information about the performance of a Fund, or to obtain a current PDS, visit www.vanguard.com.au or contact Client Services on 1300 655 101.

Interest on amounts awaiting investment or withdrawal Amounts paid to a fund may accrue interest in the fund’s accounts pending the issue of units or the return of application monies to you. Similarly, amounts made available to satisfy a withdrawal request may also accrue interest pending the payment to you. Any such interest will be retained by the relevant fund for the benefit of all investors.

Vanguard Investor Index Funds Product Disclosure Statement


How to invest Just follow these simple steps after reading this Product Disclosure Statement.

occupation which makes them eligible. Please note that we require the copy which was actually signed by the certifier.

• Complete all sections of the relevant Application for Investment Form. • Read and sign the declaration. • If you are signing under power of attorney, please supply a certified copy of the power of attorney and appropriate photo identification for the attorney. • Refer to the checklist on the Application for Investment Form.

Superannuation funds (including self managed superannuation funds) and other trusts

Send your completed forms to: Vanguard Investments Australia Ltd GPO Box 3006FF Melbourne Vic 3001

Supporting/identification documents From 11 December 2007, we will start collecting supporting identification documents from prospective investors in order to meet our obligations under new anti-money laundering and counter-terrorism financing laws. These laws apply to all managed funds in Australia, but other providers of managed funds may be at different stages of complying with the new laws. The following sections outline the types of documents which we will collect from you. We will usually collect these documents before processing your application, but may request additional information at a later date. If you do not provide the documents we request, we may not be able to process your application or instructions from time to time. If you are completing our form with the assistance of a financial adviser, you may find that your adviser has entered into arrangements with Vanguard which will allow your adviser to collect and verify your information on our behalf. If this is the case, you may not have to attach all of the supporting/identification documents when completing your initial application form.

Superannuation funds, self managed superannuation funds and other trusts (such as family trusts, deceased estate trusts and unit trusts) should complete Form 2. However, if the investment is to be held in the name of a custodian, the custodian should complete Form 3 and you do not need to complete Form 2. When completing Form 2, please ensure that you attach certified copies of the following documents: • a properly certified copy of the trust deed (or extract from the trust deed or other official document) which shows the name of the trust; AND • if there is a company acting as trustee, a properly certified copy of a certificate of incorporation (or other official document) which confirms the company’s name, identification number (e.g. ACN) and whether the company is a public or proprietary (private) company; AND • if there is an individual acting as trustee, a properly certified copy of the trustee’s current driver’s licence or current passport which confirms the name and date of birth of the first trustee named in the form. Each certified copy must include the statement “I certify this is a true copy of the original document” (or similar wording) and must be signed by an eligible certifier – refer to the box on page 41. The certifier must state their qualification or occupation which makes them eligible. Please note that we require the copy which was actually signed by the certifier.

Companies (including custodians), partnerships and associations

Individuals and joint investors

Companies, partnerships and associations should complete Form 3. This includes companies which are investing in their capacity as a custodian (for example, as the custodian of a superannuation fund, master trust, platform or other beneficial owner).

Individuals and joint investors should complete Form 1. When completing your form, please attach: • a certified copy of each investor’s current driver’s licence OR • a certified copy of the photo page from their current passport.

In the case of companies, please attach: • a properly certified copy of a certificate of incorporation (or other official document) which confirms the company’s name, identification number (e.g. ACN) and whether the company is a public or proprietary (private) company.

The certified copy must include the statement “I certify this is a true copy of the original document” (or similar wording) and must be signed by an eligible certifier – refer to the box on pae 41. The certifier must state their qualification or

In the case of partnerships, please attach: • a properly certified copy of the partnership agreement (or extract from the partnership agreement) which confirms the full legal name of the partnership; AND

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Vanguard Investor Index Funds Product Disclosure Statement

40


Additional information

• for one of the partners, a properly certified copy of their current driver’s licence or current passport which confirms their name and date of birth. In the case of associations, please attach: • a properly certified copy of the constitution, articles or rules of the association (or an extract from one of these documents) which confirms the full legal name of the association; AND • a properly certified copy of an official certificate or notice which confirms any official identification number issued to the association; AND • for the secretary (or equivalent) of the association, a properly certified copy of their current driver’s licence or current passport which confirms their name and date of birth. Each certified copy must include the statement “I certify this is a true copy of the original document” (or similar wording) and must be signed by an eligible certifier – refer to the box below. The certifier must state their qualification or occupation which makes them eligible. Please note that we require the copy which was actually signed by the certifier.

Eligible certifiers: Who can certify copies of documents? When having copies of documents certified, you should show both the original document and copy to the eligible certifier. The eligible certifier should state in writing on the copy “I certify this is a true copy of the original document” (or similar wording). The certifier must state their qualification or occupation which makes them eligible. Please note that we require the copy which was actually signed by the certifier. Eligible certifiers include: • lawyers; • certified practising or chartered accountants with 2+ years membership; • justices of the peace; • police officers; • notaries public; • Australia Post employees with 2+ years experience; • officers of financial institutions with 2+ years experience; • officers of Australian Financial Services Licence (AFSL) holders with 2+ years experience – for example, this may include your financial adviser. Alternative forms of identification may be acceptable under circumstances permitted by law. Please contact Vanguard Client Services on 1300 655 101 for further information.

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Vanguard Investor Index Funds Product Disclosure Statement


RETAIL INVESTORS Page 1 of 6

Application for Investment Form 1 Vanguard® Investor Index Funds (retail) Product Disclosure Statement Dated 11 December 2007 Note: It is important to read the Vanguard Investor Index Funds Product Disclosure Statement (PDS) carefully. If you received the PDS electronically and would like a paper copy of the PDS to which this form relates, Vanguard will provide a copy accompanied by this form free of charge upon request. The law prohibits any person passing on to another person this Application for Investment Form unless it is attached to, or accompanied by, a complete and unaltered electronic version of the PDS or a print out of it. Please complete ALL sections in BLOCK letters.

This form is for new investors only If you wish to add to your existing investment, then please complete an Additional Application Form on www.vanguard.com.au

Completing your application form is simple This form is for INDIVIDUALS and JOINT INVESTORS (including child/minor accounts) • Trusts (including superannuation funds and self managed superannuation funds) need to complete Form 2 included in this PDS. • Custodians for superannuation funds and master trusts need to complete Form 3 included in this PDS. • Companies, partnerships and associations need to complete Form 3 included in this PDS.

Complete one of the options below: • If you are an individual investor, please complete sections 1 and 4 to 8. • If you are making a joint investment, please complete sections 1, 2 and 4 to 8. • If you are making an investment on behalf of a child/minor, please complete sections 1 to 8. • • • •

If applicable, include your adviser’s details in section 9. Attach certified copies of the identification documents requested on pages 40 and 41 of this PDS. Please ensure that your application form is signed. Return your application to us with your cheque or indicate in section 4 if you wish to invest by BPAY®.

Need help? If you need any help completing this form or would like any further information please call Vanguard Client Services on 1300 655 101, 8:00 am to 6:00 pm, Monday to Friday (Melbourne time).

© 2007 Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263 / RSE Licence L0001335). We are the trustee of: Vanguard ® Personal Superannuation Plan R1004540 / Vanguard ® LifeStrategy ® Index PST - Conservative R1004557 / Vanguard ® LifeStrategy ® Index PST - Balanced R1004564 / Vanguard ® LifeStrategy ® Index PST - Growth R1004571 / Vanguard ® LifeStrategy ® Index PST - High Growth R1004588. ® Registered to BPAY Pty Ltd. ABN 6907137518.


RETAIL INVESTORS Page 2 of 6

1. Name of investors (please complete ALL fields) INDIVIDUAL OR JOINT APPLICANTS INVESTOR 1 1.0

Title Given names/s Surname Date of birth

1.1 Are you, or have you been, commonly known by two or more different names? NO

YES

Title Other given name Other surname

1.2 Is your country of residency Australia? YES

Please provide your country of residence

NO

1.3 Are you an Accountant/Lawyer/Notary/Sole Practitioner/Importer/Exporter/work for a Charitable Organisation or Non-Government Welfare Organisation (NGO)? YES

Please state different occupation

NO

1.4 Are you a sole trader? NO

YES

Full business name ABN/ARBN/ACN

1.5 Full residential address Unit and/or street number (must NOT be a PO Box) Street name Suburb State

Postcode

Country Postal address (if different from above)

1.6

Note: This address will be used for all account correspondence, however we do also require your full residential address.

Suburb State

Postcode

Country 1.7

Home telephone (

)

Business telephone (

)

Mobile telephone E-mail address 1.8 Have you attached properly certified copies of the supporting documents referred to on pages 40 and 41 of the PDS (e.g. a certified copy of your current driver’s licence or the photo page of your current passport)? YES

NO

Failure to supply certified copies of documents may prevent or delay processing your application. Please refer to pages 40 and 41 for details on our requirements.


RETAIL INVESTORS Page 3 of 6

2. Name of investors continued (please complete ALL fields) INDIVIDUAL OR JOINT APPLICANTS INVESTOR 2 (if applicable) 2.0

Title Given names/s Surname Date of birth

2.1 Are you, or have you been, commonly known by two or more different names? NO

YES

Title Other given name Other surname

2.2 Is your country of residency Australia? YES

NO

Please provide your country of residence

2.3 Are you an Accountant/Lawyer/Notary/Sole Practitioner/Importer/Exporter/work for a Charitable Organisation or Non-Government Welfare Organisation (NGO)? YES

NO

Please state different occupation

2.4 Are you a sole trader? NO

YES

Full business name ABN/ARBN/ACN

2.5 Full residential address Unit and/or street number (must NOT be a PO Box) Street name Suburb State

Postcode

Country 2.6

Home telephone (

)

Business telephone (

)

Mobile telephone E-mail address 2.7 Have you attached properly certified copies of the supporting documents referred to on pages 40 and 41 of the PDS (e.g. a certified copy of your current driver’s licence or the photo page of your current passport)? YES

NO

Failure to supply certified copies of documents may prevent or delay processing your application. Please refer to pages 40 and 41 for details on our requirements.

3. For child/minor account only If you wish to include the name of a child under age 18 in the account name, please state the name in which you wish the account to be opened. Name Note: We will treat the individual(s) named in Section 1 as the investor, for example, for the purposes of accepting instructions, unless we are properly instructed otherwise.

© 2007 Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263 / RSE Licence L0001335). We are the trustee of: Vanguard ® Personal Superannuation Plan R1004540 / Vanguard ® LifeStrategy ® Index PST - Conservative R1004557 / Vanguard ® LifeStrategy ® Index PST - Balanced R1004564 / Vanguard ® LifeStrategy ® Index PST - Growth R1004571 / Vanguard ® LifeStrategy ® Index PST - High Growth R1004588. ® Registered to BPAY Pty Ltd. ABN 6907137518.


RETAIL INVESTORS Page 4 of 6

4. Investment selection Please note: Initial investment applications must be for a minimum of $5,000 per fund.

Please tick this box if you would like to pay this initial investment by BPAY. (Please provide your e-mail address in sections 1.7 or 2.6.)

Name of Vanguard Investor Index Fund

Reinvest income (please tick )

Amount to be invested

Vanguard Index Cash Plus Fund

$

,

,

.

Vanguard Index Diversified Bond Fund

$

,

,

.

Vanguard Index Property Securities Fund

$

,

,

.

Vanguard High Yield Australian Shares Fund

$

,

,

.

Vanguard Index Australian Shares Fund

$

,

,

.

Vanguard Index International Shares Fund

$

,

,

.

Vanguard Index Hedged International Shares Fund

$

,

,

.

Vanguard LifeStrategy Conservative Fund

$

,

,

.

Vanguard LifeStrategy Balanced Fund

$

,

,

.

Vanguard LifeStrategy Growth Fund

$

,

,

.

Vanguard LifeStrategy High Growth Fund

$

,

,

.

,

,

.

Total investment

$

Please note: Vanguard will automatically reinvest your distribution in units of your chosen fund if you do not make a selection.

Credit bank account (please tick )

Please provide your bank details in Section 5

5. Banking instructions BSB number Account number Account name (e.g. John Smith)

Name of financial institution

6. Annual report options (please tick  one option) I would like to be notified by e-mail when the annual report is available on the Vanguard website. (Please provide your e-mail address.) I would like to receive a printed copy of the annual report in the mail each year. I do not want to be sent a copy of the annual report and do not want to be told when it is available online. If you do not select an option, we will notify you by e-mail or post.

© 2007 Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263 / RSE Licence L0001335). We are the trustee of: Vanguard ® Personal Superannuation Plan R1004540 / Vanguard ® LifeStrategy ® Index PST - Conservative R1004557 / Vanguard ® LifeStrategy ® Index PST - Balanced R1004564 / Vanguard ® LifeStrategy ® Index PST - Growth R1004571 / Vanguard ® LifeStrategy ® Index PST - High Growth R1004588. ® Registered to BPAY Pty Ltd. ABN 6907137518.


RETAIL INVESTORS Page 5 of 6

7. Declaration, applicant signature/s and notification of account signing authority/ies

8. Tax File Number (TFN) notification or exemption

• I/We have received the Vanguard Investor Index Funds PDS dated 11 December 2007 (electronic or hard copy), and I/we have detached this Application for Investment Form from the PDS and declare all details given in this application are true and correct. • I/We have read the PDS to which this application applies and agree to be bound by the terms and conditions of the PDS, the Facsimile Indemnity as referred to on page 33, and the constitution of the relevant fund/s in which I/we are investing, as referred to on page 37 of the PDS (and as amended from time to time), which govern the funds. • I/We understand that none of The Vanguard Group, Inc. (including Vanguard Investments Australia Ltd) or their related entities, directors or officers guarantees the performance of, the repayment of capital, or income invested in, the fund/s. • I/We acknowledge and agree that the funds will invest in other Vanguard funds and that Vanguard will derive and retain remuneration from those other funds. • I/We acknowledge that joint applicants or signatories who allow either investors or signatories to give instructions in relation to an investment in the fund/s will bind other investors or signatories for all transactions in connection with the investment including changes to account details. • I/We declare that I/we have the capacity and power to make an investment in accordance with the application. • I/We declare that in making a decision to invest the only information and representations provided by Vanguard are those contained in the PDS to which this application relates. • If signed under power of attorney, the attorney verifies that no notice of revocation of that power has been received. • I/We agree to reimburse and indemnify Vanguard for all taxes, duties and charges imposed against Vanguard or its agents that may be assessed against Vanguard as a result of my/our entitlement to the capital or distributable income of the fund (Taxation Amount). • I/We authorise Vanguard to deduct from my/our income distributions payable from the fund, on account of the Taxation Amount which Vanguard is or may become liable to pay in respect of my/our entitlement to the capital or distributable income of the fund. • I/We understand that Vanguard may request or require additional personal or customer entity information in order to fulfil legislative obligations. Failure to supply the information punctually may result in Vanguard being prevented by law from carrying out instructions. • I/We understand that Vanguard will not be familiar with, and is not responsible for being familiar with, the contents of any document provided in connection with this investment or subsequent investments, for example, trust deeds, partnership agreements, constitutions, governing rules and minutes of resolutions. I/We release Vanguard from all responsibility and liability whatsoever in connection with any action or inaction by Vanguard which constitutes or gives rise to an inconsistency with, or breach of, any such documents, and will indemnify Vanguard in respect of any such liability. • I/We understand and agree that, even if all information requested on this application form has been provided and received by Vanguard prior to the cut-off time for receiving instructions, the processing of my/our application may be postponed or delayed while Vanguard verifies the information I/we have provided and considers whether additional information is required, in which case my/our application will be processed at the unit price applicable for the business day as at which all information has been received and verified. • I/We have read the Privacy Policy on page 39 of this document and I consent to the handling and disclosure of my personal information as described in the Privacy Policy except as indicated below.

You may choose to quote your TFN or claim an exemption in relation to your investments in the fund/s by completing this section. Collection of your TFN is authorised, and its use and disclosure are strictly regulated by the tax laws and Privacy Act. Quotation is not compulsory but tax may be taken out of your distribution if you do not quote your TFN or claim an exemption (at the date of this PDS this was the highest marginal tax rate plus Medicare Levy). You may provide us with your ABN if you are making this investment in the course of carrying on an enterprise. If you choose not to, and do not provide your TFN or TFN exemption either, we are required to deduct tax on any income distribution at the prescribed rate (at the date of this PDS this was the highest marginal tax rate plus Medicare Levy). If you wish to provide your ABN number, please complete section 1.4 of this form.

Please do not give my personal details to market research companies conducting research for Vanguard. Please do not send me Vanguard marketing and educational material.

Either Signatory 1 OR 2

Signatory 1 ONLY

Signatory 2 ONLY

I wish to quote my TFN TFN I do not wish to quote a TFN. (Please complete reason for exemption below.) Investor 2 Name

I wish to quote my TFN TFN I do not wish to quote a TFN. (Please complete reason for exemption below.) Child/minor Name

I wish to quote my TFN TFN

When purchasing through an adviser or a broker • I/We authorise Vanguard to disclose to the adviser or broker or dealer group noted on this Application for Investment Form, information relating to my/our application for investment into the fund/s or any subsequent information relating to my/our investment. I/We understand that this will not include disclosure of my/our Tax File Number/s or any information in relation to it/them. This authority will continue unless revoked in writing by me/us. Account signing authorities (please tick  one option) Please indicate who can give us instructions in relation to the investment Signatory 1 AND 2

Investor 1 Name

I do not wish to quote a TFN.

Reason for exemption Investor 1 Pensioner. Please provide the name of your pension.

Allow other authorised signatories (You must provide a certified copy of all authorised signatories.) If you do not tick one of the above options all future instructions must be signed by all of the signatories below or as otherwise permitted by law. Applicant signatures Each signatory below confirms that they have been duly authorised to execute this application on behalf of the applicant/s and that the signing authorities specified above have also been duly authorised.

Non-resident. Please provide your country of residence.

Other. Please include relevant detail. Signatory 1

Name

Investor 2 Date

Pensioner. Please provide the name of your pension.

Signatory 2

Name

Non-resident. Please provide your country of residence.

Date

Please mail your application to: Vanguard Investments Australia Ltd Reply Paid 3006 Melbourne Vic 8060

RET1207WEB Other. Please include relevant detail.

© 2007 Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263 / RSE Licence L0001335). We are the trustee of: Vanguard ® Personal Superannuation Plan R1004540 / Vanguard ® LifeStrategy ® Index PST - Conservative R1004557 / Vanguard ® LifeStrategy ® Index PST - Balanced R1004564 / Vanguard ® LifeStrategy ® Index PST - Growth R1004571 / Vanguard ® LifeStrategy ® Index PST - High Growth R1004588. ® Registered to BPAY Pty Ltd. ABN 6907137518.


RETAIL INVESTORS Page 6 of 6

9. Adviser or broker details (adviser or broker to complete if applicable) Adviser number (if applicable) A N Business name

AFSL number Dealer group (if different from above) Full name of individual adviser Mailing address

Suburb State

Postcode

Country Mobile telephone Business telephone (

)

Facsimile (

)

E-mail address

Adviser stamp

© 2007 Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263 / RSE Licence L0001335). We are the trustee of: Vanguard ® Personal Superannuation Plan R1004540 LifeStrategy IndexLicence PST - L0001335). Conservative / Vanguard ® LifeStrategy ® © 2007 Vanguard Investments Australia Ltd (ABN 72 072 881/ Vanguard 086 / AFS®Licence 227263®/ RSE WeR1004557 are the trustee of: Vanguard ® Personal Balanced R1004564 / Vanguard ®® LifeStrategy Superannuation Plan R1004540 / Vanguard ® LifeStrategy ® Index Index PST - Conservative R1004557 / Vanguard LifeStrategy®®Index IndexPST PST-- Growth BalancedR1004571 R1004564/ / Vanguard ® LifeStrategy ® Index PST - Growth R1004571 Vanguard / Vanguard®®LifeStrategy LifeStrategy®®Index IndexPST PST- -High HighGrowth GrowthR1004588. R1004588. ®®Registered Registered to to BPAY BPAY Pty Pty Ltd. ABN 6907137518. ABN 6907137518.


RETAIL INVESTORS

Application for Investment Form 2 Vanguard® Investor Index Funds (retail) Product Disclosure Statement Dated 11 December 2007 Note: It is important to read the Vanguard Investor Index Funds Product Disclosure Statement (PDS) carefully. If you received the PDS electronically and would like a paper copy of the PDS to which this form relates, Vanguard will provide a copy accompanied by this form free of charge upon request. The law prohibits any person passing on to another person this Application for Investment Form unless it is attached to, or accompanied by, a complete and unaltered electronic version of the PDS or a print out of it. Please complete ALL sections in BLOCK letters.

This form is for new investors only

If you wish to add to your existing investment, then please complete an Additional Application Form on www.vanguard.com.au

Completing your application form is simple This form is for TRUSTS which includes: • Superannuation funds (including self managed superannuation funds) • Family trusts • Unit trusts • Probate trusts etc • Individuals and joint investors (including child/minor accounts) need to complete Form 1 included in this PDS. • Custodians for superannuation funds and master trusts need to complete Form 3 included in this PDS. • Companies, partnerships and associations need to complete Form 3 included in this PDS. Complete one of the options below: • If this trust has individuals acting as trustees, please complete sections 1,2 and 4 to 8. • If this trust has a company acting as a trustee, please complete sections 1,3 and 4 to 8. • If applicable, include your adviser’s details in section 9. • Attach certified copies of the identification documents requested on pages 40 and 41 of this PDS. • Please ensure that your application form is signed. • Return your application to us with your cheque or indicate in Section 4 if you wish to invest by BPAY®. Need help? If you need any help completing this form or would like any further information please call Vanguard Client Services on 1300 655 101, 8:00 am to 6:00 pm, Monday to Friday (Melbourne time).


RETAIL INVESTORS

1. TRUST 1.0 Type of Trust?

Superannuation Fund including Self-Managed Superannuation Fund

Family Trust

Unit Trust

Probate Trust

Other, please specify Full legal name of the trust (NOT the trustee)

1.1

ABN/ARBN/ACN 1.2 Was this trust formed/incorporated in Australia? YES

Please state different country

NO

1.3 Is the Trust entity regulated by an Australian Regulator (i.e.: ASIC, ATO, APRA)? YES

Please supply full name and residential address (must not be a PO Box) for each beneficiary of the trust entity OR state beneficiaries by class or category. Describe beneficiaries by class/category (e.g. family member, employees of a particular company) Proceed to question 1.4

NO

OR Please attach a separate page if you require more space Beneficiary 1 Address Suburb State

Postcode

Country

Postcode

Country

Postcode

Country

Beneficiary 2 Address Suburb State Beneficiary 3 Address Suburb State

1.4 Is the trust a Charitable Organisation or Non-Government Welfare Organisation (NGO) or does the trust carry on business as an Accountant/Lawyer/Notary/Sole Practitioner/Importer or Exporter? YES

NO

Please state different business type (e.g. superannuation fund)

1.5 Have you attached a properly certified copy of the trust deed (or extract from the trust deed or other official document) which shows the name of the trust? YES

NO

Failure to supply certified copies of documents may prevent or delay processing your application. Please refer to pages 40 and 41 for details on our requirements.


RETAIL INVESTORS

2. TRUSTEE – INDIVIDUAL TRUSTEES (complete this section if the trust has individuals acting as trustees) Please attach a separate sheet if you have additional trustees 2.0 Trustee 1

Title Given names/s Surname Date of birth

2.1 Full residential address Unit and/or street number (must NOT be a PO Box) Street name Suburb State

Postcode

Country Postal address (if different from above)

2.2

Note: This address will be used for all account correspondence, however we do also require your full residential address.

Suburb State

Postcode

Country 2.3

Contact details

Home telephone (

)

Business telephone (

)

Mobile telephone E-mail address 2.4 If there are other persons acting as trustee, please supply full name and full residential address (must not be a PO Box) for each trustee. (Please attach a separate page if you require more space.) Trustee 2

Title Given names/s Surname

2.5 Full residential address Unit and/or street number (must NOT be a PO Box) Street name Suburb State

Postcode

Country 2.6 Have you attached a properly certified copy of the trustee’s current drivers licence or current passport which confirms the name and date of birth of the first trustee named in the form? YES

NO

Failure to supply certified copies of documents may prevent or delay processing your application. Please refer to pages 40 and 41 for details on our requirements.


RETAIL INVESTORS

3. TRUSTEE – CORPORATE TRUSTEE (complete this section if the trust has a company acting as trustee) 3.0

Full legal name of trustee

ABN/ARBN/ACN Business name

3.1 Was this corporate trustee formed/incorporated in Australia? YES

Please state different country

NO

3.2

Full registered address in Australia (must NOT be a PO Box)

Suburb State

Postcode

Country Principal place of business (if different from above – must NOT be a PO Box)

3.3

Suburb State

Postcode

Country 3.4

Postal address (if different from 3.2) Note: This address will be used for all account correspondence, however we do also require your full business address.

Suburb State

Postcode

Country 3.5

Contact details

Contact name

Business telephone (

)

Mobile telephone E-mail address 3.6 Is the corporate trustee a Charitable Organisation or Non-Government Welfare Organisation (NGO) or does it carry on business as an Accountant/Lawyer/Notary/Sole Practitioner/Importer or Exporter? YES

NO

Please state different business type (e.g. professional trustee)


RETAIL INVESTORS

3.7 Is the corporate trustee a public company?

YES

Please proceed to section 3.8

NO

Please supply the following:

If a proprietary/private company – please supply full name of each director. (Please attach a separate page if you require more space.) Director 1 Director 2 Director 3 Director 4 Director 5 Director 6 Please also supply full name and address for all beneficial owners (holding more than 25% of issued share capital in the corporate trustee). (Please attach a separate page if you require more space.) Beneficiary 1 Address Suburb State

Postcode

Country

Postcode

Country

Postcode

Country

Postcode

Country

Beneficiary 2 Address Suburb State Beneficiary 3 Address Suburb State Beneficiary 4 Address Suburb State

3.8 Have you attached a properly certified copy of a certificate of incorporation (or other official document) which confirms the corporate trustee’s name, identification number (e.g. ACN) and whether the company is a public or proprietary (private) company? YES

NO

Failure to supply certified copies of documents may prevent or delay processing your application. Please refer to pages 40 and 41 for details on our requirements.


RETAIL INVESTORS

4. Investment selection Please note: Initial investment applications must be for a minimum of $5,000 per fund.

Please tick this box if you would like to pay this initial investment by BPAY. (Please provide your e-mail address in sections 2.3 or 3.5)

Name of Vanguard Investor Index Fund

Reinvest income (please tick )

Amount to be invested

Vanguard Index Cash Plus Fund

$

,

,

.

Vanguard Index Diversified Bond Fund

$

,

,

.

Vanguard Index Property Securities Fund

$

,

,

.

Vanguard High Yield Australian Shares Fund

$

,

,

.

Vanguard Index Australian Shares Fund

$

,

,

.

Vanguard Index International Shares Fund

$

,

,

.

Vanguard Index Hedged International Shares Fund

$

,

,

.

Vanguard LifeStrategy Conservative Fund

$

,

,

.

Vanguard LifeStrategy Balanced Fund

$

,

,

.

Vanguard LifeStrategy Growth Fund

$

,

,

.

Vanguard LifeStrategy High Growth Fund

$

,

,

.

,

,

.

Total investment

$

Please note: Vanguard will automatically reinvest your distribution in units of your chosen fund if you do not make a selection.

5. Banking instructions BSB number Account number Account name (e.g. John Smith)

Name of financial institution

6. Annual report options (please tick  one option) I would like to be notified by e-mail when the annual report is available on the Vanguard website. (Please provide your e-mail address.) I would like to receive a printed copy of the annual report in the mail each year. I do not want to be sent a copy of the annual report and do not want to be told when it is available online. If you do not select an option, we will notify you by e-mail or post.

Credit bank account (please tick )

Please provide your bank details in Section 5


RETAIL INVESTORS

7. Declaration, applicant signature/s and notification of account signing authority/ies

8. Tax File Number (TFN) notification or exemption

• I/We have received the Vanguard Investor Index Funds PDS dated 11 December 2007 (electronic or hardcopy), andI/we have detached this Application for Investment Form from the PDS and declare all details given inthis application are true and correct. • I/We have read the PDS to which this application applies and agree to be bound by the terms andconditions of the PDS, the Facsimile Indemnity as referred to on page 33, and the constitution of therelevant fund/s in which I/we are investing, as referred to on page 37 of the PDS (and as amended fromtime to time), which govern the funds. • I/We understand that none of The Vanguard Group, Inc. (including Vanguard Investments AustraliaLtd) or their related entities, directors or officers guarantees the performance of, the repayment ofcapital, or income invested in, the fund/s. • I/We acknowledge and agree that the funds will invest in other Vanguard funds and that Vanguard will derive and retain remuneration from those other funds. • I/We acknowledge that joint applicants or signatories who allow either investors or signatories to giveinstructions in relation to an investment in the fund/s will bind other investors or signatories for alltransactions in connection with the investment including changes to account details. • I/We declare that I/we have the capacity and power to make an investment in accordance with theapplication. • I/We declare that in making a decision to invest the only information and representations provided byVanguard are those contained in the PDS to which this application relates. • If signed under power of attorney, the attorney verifies that no notice of revocation of that power has beenreceived. • I/We agree to reimburse and indemnify Vanguard for all taxes, duties and charges imposed againstVanguard or its agents that may be assessed against Vanguard as a result of my/our entitlement to thecapital or distributable income of the fund (Taxation Amount). • I/We authorise Vanguard to deduct from my/our income distributions payable from the fund, onaccount of the Taxation Amount which Vanguard is or may become liable to pay in respect of my/ ourentitlement to the capital or distributable income of the fund. • I/We understand that Vanguard may request or require additional personal or customer entityinformation in order to fulfil legislative obligations. Failure to supply the information punctually mayresult in Vanguard being prevented by law from carrying out instructions. • I/We understand that Vanguard will not be familiar with, and is not responsible for being familiar with,the contents of any document provided in connection with this investment or subsequent investments,for example, trust deeds, partnership agreements, constitutions, governing rules and minutes ofresolutions. I/We release Vanguard from all responsibility and liability whatsoever in connection withany action or inaction by Vanguard which constitutes or gives rise to an inconsistency with, or breach of,any such documents, and will indemnify Vanguard in respect of any such liability. • I/We understand and agree that, even if all information requested on this application form has beenprovided and received by Vanguard prior to the cut-off time for receiving instructions, the processing of my/our application may be postponed or delayed while Vanguard verifies the information I/we have provided and considers whether additional information is required, in which case my/ our application will be processed at the unit price applicable for the business day as at which all information has been received and verified. • I have read the Privacy Policy on page 39 of this document and I consent to the handling anddisclosure of my personal information as described in the Privacy Policy except as indicated below.*

You may choose to quote your TFN or claim an exemption in relation to your investments in the Fund/s by completing this section. Collection of your TFN is authorised, and its use and disclosure are strictly regulated by the tax laws and Privacy Act. Quotation is not compulsory but tax may be taken out of your distribution if you do not quote your TFN or claim an exemption (at the date of this PDS this was the highest marginal tax rate plus Medicare Levy). You may provide us with your ABN if you are making this investment in the course of carrying on an enterprise. If you choose not to, and do not provide your TFN or TFN exemption either, we are required to deduct tax on any income distribution at the prescribed rate (at the date of this PDS this was the highest marginal tax rate plus Medicare Levy). If you wish to provide your ABN number, please complete the relevant sections of this form.

Please do not give my personal details to market research companies conducting research for Vanguard. Please do not send me Vanguard marketing and educational material

Either Signatory 1 OR 2

Signatory 1 ONLY

Signatory 2 ONLY

I wish to quote my TFN TFN I do not wish to quote a TFN. (Please complete reason for exemption below.) Trustee 2 Name

I wish to quote my TFN TFN I do not wish to quote a TFN. (Please complete reason for exemption below.) Superannuation fund/company/trust Name

I wish to quote my TFN TFN

When purchasing through an adviser or a broker • I/We authorise Vanguard to disclose to the adviser or broker or dealer group noted on this Application for Investment Form, information relating to my/our application for investment into the fund/s or any subsequent information relating to my/our investment. I/We understand that this will not include disclosure of my/our Tax File Number/s or any information in relation to it/them. This authority will continue unless revoked in writing by me/us. Account signing authorities (please tick  one option) Please indicate who can give us instructions in relation to the investment Signatory 1 AND 2

Trustee 1 Name

I do not wish to quote a TFN.

Reason for exemption Trustee 1 Pensioner. Please provide the name of your pension.

Allow other authorised signatories (You must provide a certified copy of all authorised signatories.) If you do not tick one of the above options all future instructions must be signed by all of the signatories below or as otherwise permitted by law. Applicant signatures Each signatory below confirms that they have been duly authorised to execute this application on behalf of the applicant/s and that the signing authorities specified above have also been duly authorised.

Non-resident. Please provide your country of residence.

Other. Please include relevant detail. Signatory 1

Name

Trustee 2 Date

Pensioner. Please provide the name of your pension.

Signatory 2

Name

Non-resident. Please provide your country of residence.

Date

Please mail your application to: Vanguard Investments Australia Ltd Reply Paid 3006 Melbourne Vic 8060

RET1207WEB Other. Please include relevant detail.


RETAIL INVESTORS

9. Adviser or broker details (adviser or broker to complete if applicable) Adviser number (if applicable) A N Business name

AFSL number Dealer group (if different from above) Full name of individual adviser Mailing address

Suburb State

Postcode

Country Mobile telephone Business telephone (

)

Facsimile (

)

E-mail address

Adviser stamp

© 2007 Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263 / RSE Licence L0001335). We are the trustee of: Vanguard ® Personal Superannuation Plan R1004540 / Vanguard ® LifeStrategy ® Index PST - Conservative R1004557 / Vanguard ® LifeStrategy ® Index PST - Balanced R1004564 / Vanguard ® LifeStrategy ® Index PST - Growth R1004571 / Vanguard ® LifeStrategy ® Index PST - High Growth R1004588. ® Registered to BPAY Pty Ltd. ABN 6907137518.


RETAIL INVESTORS

Application for Investment Form 3 Vanguard® Investor Index Funds (retail) Product Disclosure Statement Dated 11 December 2007 Note: It is important to read the Vanguard Investor Index Funds Product Disclosure Statement (PDS) carefully. If you received the PDS electronically and would like a paper copy of the PDS to which this form relates, Vanguard will provide a copy accompanied by this form free of charge upon request. The law prohibits any person passing on to another person this Application for Investment Form unless it is attached to, or accompanied by, a complete and unaltered electronic version of the PDS or a print out of it. Please complete ALL sections in BLOCK letters.

This form is for new investors only If you wish to add to your existing investment, then please complete an Additional Application Form on www.vanguard.com.au

Completing your application form is simple This form is for COMPANIES (including custodians and margin lending providers), PARTNERSHIPS and ASSOCIATIONS • Individuals and joint investors (including child/minor accounts) need to complete Form 1 included in this PDS. • Trusts (including superannuation funds and self managed superannuation funds) need to complete Form 2 included in this PDS, unless they are investing through a custodian.

Complete one of the options below: • If this investment is in the name of a company, please complete sections 1 and 4 to 8. • If this investment is in the name of a partnership, please complete sections 2 and 4 to 8. • If this investment is in the name of an association, please complete sections 3 to 8. • If applicable, include your adviser’s details in section 9. • Attach certified copies of the identification documents requested on pages 40 and 41 of this PDS. • Please ensure that your application form is signed. ® • Return your application to us with your cheque or indicate in Section 4 if you wish to invest by BPAY .

Need help? If you need any help completing this form or would like any further information please call Vanguard Client Services on 1300 655 101, 8:00 am to 6:00 pm, Monday to Friday (Melbourne time).


RETAIL INVESTORS

1. COMPANY 1.0

Full legal name

ABN/ARBN/ACN Account name (if different from above) (e.g. for custodians: ABC Ltd ACF XYZ Super Fund) (e.g. for margin lenders: ABC Ltd A/c John Citizen)

1.1 Was this company formed/incorporated in Australia? Please state YES NO different country 1.2 Is this company registered outside Australia? Foreign registration/ NO YES identification number 1.3

Full registered office address in Australia (must NOT be a PO Box)

Suburb State

Postcode

Country Principal place of business (if different from above – must NOT be a PO Box)

1.4

Suburb State

Postcode

Country 1.5

Postal address (if different from 1.3) Note: This address will be used for all account correspondence, however we do also require your full business address.

Suburb State

Postcode

Country 1.6

Contact details

Contact name

Business telephone (

)

Mobile telephone E-mail address 1.7 Is the corporation a Charitable Organisation or Non-Government Welfare Organisation (NGO) or does the company carry on business as an Accountant/Lawyer/Notary/Sole Practitioner/Importer or Exporter? YES

NO

Please state different business type (e.g. financial services, manufacturing)


RETAIL INVESTORS

1.8 Is the company a public company?

YES

Please proceed to section 1.9

NO

Please supply the following:

PROPRIETARY/PRIVATE COMPANY – ADDITIONAL INFORMATION Please supply full name of each director. (Please attach a separate page if you require more space.) Director 1 Director 2 Director 3 Director 4 Director 5 Director 6 Director 7 Director 8 Please also supply full name and address for all beneficial owners (holding more than 25% of issued share capital in the company) (Please attach a separate page if you require more space.) Beneficiary 1 Address Suburb State

Postcode

Country

Postcode

Country

Postcode

Country

Postcode

Country

Beneficiary 2 Address Suburb State Beneficiary 3 Address Suburb State Beneficiary 4 Address Suburb State

1.9 Have you attached a properly certified copy of a certificate of incorporation (or other official document) which confirms the company’s name, identification number (e.g. ACN) and whether the company is a public or proprietary (private) company? YES

NO

Failure to supply certified copies of documents may prevent or delay processing your application. Please refer to pages 40 and 41 for details on our requirements.


RETAIL INVESTORS

2. PARTNERSHIP 2.0

Full legal name

ABN/ARBN/ACN Trading name (if different from above)

2.1 Was this partnership formed in Australia? YES

Which state/territory?

NO

Please state different country

2.2 Is the partnership a Charitable Organisation or Non-Government Welfare Organisation (NGO) or does it carry on business as an Accountant/Lawyer/Notary/Sole Practitioner/Importer or Exporter? YES 2.3

NO

Please state different business type (e.g. consultancy, medical)

Full registered office address in Australia (must NOT be a PO Box)

Suburb State

Postcode

Country 2.4

Postal address (if different from above) Note: This address will be used for all account correspondence, however we do also require your full business address.

Suburb State

Postcode

Country 2.5

Contact details

Contact name

Business telephone (

)

Mobile telephone E-mail address 2.6 For ONE PARTNER (only)

Title Given names/s Surname Date of birth

2.7 Full residential address Unit and/or street number (must NOT be a PO Box) Street name Suburb State Country

Postcode


RETAIL INVESTORS

2.8 Is the partnership regulated by a professional association? Please name association (e.g. Law Institute, AMA, CPA) and go to question 2.9

YES

Please supply full name and full residential address (must NOT be a PO Box) for each partner. (Please attach a separate page if you require more space.)

NO

Partner 2 Address Suburb State

Postcode

Country

Postcode

Country

Postcode

Country

Postcode

Country

Partner 3 Address Suburb State Partner 4 Address Suburb State Partner 5 Address Suburb State

2.9 Have you attached a properly certified copy of: • the partnership agreement (or extract from the partnership agreement or other official document) which confirms the full legal name of the partnership; and • for one of the partners, a properly certified copy of their current driver’s licence or current passport which confirms their name and date of birth? YES

NO

Failure to supply certified copies of documents may prevent or delay processing your application. Please refer to pages 40 and 41 for details on our requirements.


RETAIL INVESTORS

3. ASSOCIATION 3.0

Full legal name

ABN/ARBN/ACN Any other identification number 3.1 Was this association formed in Australia? YES

Which state/territory?

NO

Please state different country

3.2 Is the association a Charitable Organisation or Non-Government Welfare Organisation (NGO) or does the association carry on business as an Accountant/Lawyer/Notary/Sole Practitioner/Importer or Exporter? YES

NO

Please state different business type (e.g. financial services, medical)

3.3 Full principal place of business/administration Address (must NOT be a PO Box)

Suburb State

Postcode

Country Postal address (if different from above)

3.4

Note: This address will be used for all account correspondence, however we do also require your full business address.

Suburb State

Postcode

Country 3.5

Contact details

Contact name

Business telephone ( Mobile telephone E-mail address 3.6 Full name of chairman (or equivalent) 3.7 Full name of treasurer (or equivalent) 3.8 Full details for secretary (or equivalent)

Title

Given names/s Surname Date of birth

)


RETAIL INVESTORS

3.9 Full residential address Unit and/or street number (must NOT be a PO Box) Street name Suburb State

Postcode

Country 3.10 Have you attached a properly certified copy of: • the constitution, articles or rules of the association (or an extract from one of these documents) which confirms the full legal name of the association; and • an official certificate or notice which confirms any official identification number issued to the association; and • for the secretary (or equivalent) of the association, a properly certified copy of their current driver’s licence or current passport which confirms their name and date of birth? YES

NO

Failure to supply certified copies of documents may prevent or delay processing your application. Please refer to pages 40 and 41 for details on our requirements.


RETAIL INVESTORS

4. Investment selection Please note: Initial investment applications must be for a minimum of $5,000 per fund.

Please tick this box if you would like to pay this initial investment by BPAY. (Please provide your e-mail address in sections 1.6, 2.5 or 3.5.)

Name of Vanguard Investor Index Fund

Reinvest income (please tick )

Amount to be invested

Vanguard Index Cash Plus Fund

$

,

,

.

Vanguard Index Diversified Bond Fund

$

,

,

.

Vanguard Index Property Securities Fund

$

,

,

.

Vanguard High Yield Australian Shares Fund

$

,

,

.

Vanguard Index Australian Shares Fund

$

,

,

.

Vanguard Index International Shares Fund

$

,

,

.

Vanguard Index Hedged International Shares Fund

$

,

,

.

Vanguard LifeStrategy Conservative Fund

$

,

,

.

Vanguard LifeStrategy Balanced Fund

$

,

,

.

Vanguard LifeStrategy Growth Fund

$

,

,

.

Vanguard LifeStrategy High Growth Fund

$

,

,

.

,

,

.

Total investment

$

Please note: Vanguard will automatically reinvest your distribution in units of your chosen fund if you do not make a selection.

5. Banking instructions BSB number Account number Account name (e.g. John Smith)

Name of financial institution

6. Annual report options (please tick  one option) I would like to be notified by e-mail when the annual report is available on the Vanguard website. (Please provide your e-mail address.) I would like to receive a printed copy of the annual report in the mail each year. I do not want to be sent a copy of the annual report and do not want to be told when it is available online. If you do not select an option, we will notify you by e-mail or post.

Credit bank account (please tick )

Please provide your bank details in Section 5


RETAIL INVESTORS

7. Declaration, applicant signature/s and notification of account signing authority/ies

8. Tax File Number (TFN) notification or exemption

• I/We have received the Vanguard Investor Index Funds PDS dated 11 December 2007 (electronic or hard copy), and I/we have detached this Application for Investment Form from the PDS and declare all details given in this application are true and correct. • I/We have read the PDS to which this application applies and agree to be bound by the terms and conditions of the PDS, the Facsimile Indemnity as referred to on page 33, and the constitution of the relevant fund/s in which I/we are investing, as referred to on page 37 of the PDS (and as amended from time to time), which govern the funds. • I/We understand that none of The Vanguard Group, Inc. (including Vanguard Investments Australia Ltd) or their related entities, directors or officers guarantees the performance of, the repayment of capital, or income invested in, the fund/s. • I/We acknowledge and agree that the funds will invest in other Vanguard funds and that Vanguard will derive and retain remuneration from those other funds. • I/We acknowledge that joint applicants or signatories who allow either investors or signatories to give instructions in relation to an investment in the fund/s will bind other investors or signatories for all transactions in connection with the investment including changes to account details. • I/We declare that I/we have the capacity and power to make an investment in accordance with the application. • I/We declare that in making a decision to invest the only information and representations provided by Vanguard are those contained in the PDS to which this application relates. • If signed under power of attorney, the attorney verifies that no notice of revocation of that power has been received. • I/We agree to reimburse and indemnify Vanguard for all taxes, duties and charges imposed against Vanguard or its agents that may be assessed against Vanguard as a result of my/our entitlement to the capital or distributable income of the fund (Taxation Amount). • I/We authorise Vanguard to deduct from my/our income distributions payable from the fund, on account of the Taxation Amount which Vanguard is or may become liable to pay in respect of my/our entitlement to the capital or distributable income of the fund. • I/We understand that Vanguard may request or require additional personal or customer entity information in order to fulfil legislative obligations. Failure to supply the information punctually may result in Vanguard being prevented by law from carrying out instructions. • I/We understand that Vanguard will not be familiar with, and is not responsible for being familiar with, the contents of any document provided in connection with this investment or subsequent investments, for example, trust deeds, partnership agreements, constitutions, governing rules and minutes of resolutions. I/We release Vanguard from all responsibility and liability whatsoever in connection with any action or inaction by Vanguard which constitutes or gives rise to an inconsistency with, or breach of, any such documents, and will indemnify Vanguard in respect of any such liability. • I/We understand and agree that, even if all information requested on this application form has been provided and received by Vanguard prior to the cut-off time for receiving instructions, the processing of my/our application may be postponed or delayed while Vanguard verifies the information I/we have provided and considers whether additional information is required, in which case my/our application will be processed at the unit price applicable for the business day as at which all information has been received and verified. • I/We have read the Privacy Policy on page 39 of this document and I consent to the handling and disclosure of my personal information as described in the Privacy Policy except as indicated below.

You may choose to quote your TFN or claim an exemption in relation to your investments in the fund/s by completing this section. Collection of your TFN is authorised, and its use and disclosure are strictly regulated by the tax laws and Privacy Act. Quotation is not compulsory but tax may be taken out of your distribution if you do not quote your TFN or claiman exemption (at the date of this PDS this was the highest marginal tax rate plus Medicare Levy). You may provide us with your ABN if you are making this investment in the course of carrying on an enterprise. Ifyou choose not to, and do not provide your TFN or TFN exemption either, we are required to deduct tax on anyincome distribution at the prescribed rate (at the date of this PDS this was the highest marginal tax rate plus MedicareLevy). If you wish to provide your ABN, please complete the relevant sections of this form

Please do not give my personal details to market research companies conducting research for Vanguard.

When purchasing through an adviser or a broker • I/We authorise Vanguard to disclose to the adviser or broker or dealer group noted on this Application for Investment Form, information relating to my/our application for investment into the fund/s or any subsequent information relating to my/our investment. I/We understand that this will not include disclosure of my/our Tax File Number/s or any information in relation to it/them. This authority will continue unless revoked in writing by me/us. Account signing authorities (please tick  one option) Please indicate who can give us instructions in relation to the investment Either Signatory 1 OR 2

Signatory 1 ONLY

Signatory 2 ONLY

Name

I wish to quote my TFN TFN I do not wish to quote a TFN. (Please complete reason for exemption below.) Partnership Name

I wish to quote my TFN TFN I do not wish to quote a TFN. (Please complete reason for exemption below.) Association Name

I wish to quote my TFN TFN

Please do not send me Vanguard marketing and educational material.

Signatory 1 AND 2

Company

Allow other authorised signatories (You must provide a certified copy of all authorised signatories.) If you do not tick one of the above options all future instructions must be signed by all of the signatories below or as otherwise permitted by law. Applicant signatures Each signatory below confirms that they have been duly authorised to execute this application on behalf of the applicant/s and that the signing authorities specified above have also been duly authorised.

I do not wish to quote a TFN. (Please complete reason for exemption below.)

Reason for exemption Company Non-resident. Please provide your country of residence.

Other. Please include relevant detail.

Partnership Non-resident. Please provide your country of residence.

Signatory 1 Name Other. Please include relevant detail.

Date

Signatory 2 Association

Name

Non-resident. Please provide your country of residence.

Date Please mail your application to: Vanguard Investments Australia Ltd Reply Paid 3006 Melbourne Vic 8060

RET1207WEB Other. Please include relevant detail.


RETAIL INVESTORS

9. Adviser or broker details (adviser or broker to complete if applicable) Adviser number (if applicable) A N Business name

AFSL number Dealer group (if different from above) Full name of individual adviser Mailing address

Suburb State

Postcode

Country Mobile telephone Business telephone (

)

Facsimile (

)

E-mail address

Adviser stamp

© 2007 Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263 / RSE Licence L0001335). We are the trustee of: Vanguard ® Personal Superannuation Plan R1004540 / Vanguard ® LifeStrategy ® Index PST - Conservative R1004557 / Vanguard ® LifeStrategy ® Index PST - Balanced R1004564 / Vanguard ® LifeStrategy ® Index PST - Growth R1004571 / Vanguard ® LifeStrategy ® Index PST - High Growth R1004588. ® Registered to BPAY Pty Ltd. ABN 6907137518.


Vanguard Investor Index Funds PDS  

Vanguard Investments Investor Index Funds Product Disclosure Statements

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