Australian Foundation Investment Company Limited/Announcement

2022 Statutory Annual Report, Annual Review & AGM Documents

AGM29 August 2022AFIFinancials

29 August 2022

The Manager
ASX Market Announcements
Australian Securities Exchange
Exchange Centre
Level 4
20 Bridge Street
Sydney NSW 2000

Electronic Lodgement

Australian Foundation Investment Company Limited
Statutory Annual Report, Annual Shareholder Review and
Annual General Meeting Documentation

Dear Sir / Madam

Please find attached the 2022 Statutory Annual Report, Annual Shareholder
Review and Annual General Meeting Documentation being sent to
shareholders.

Yours faithfully

Matthew Rowe
Company Secretary

Authorised by the Company Secretary

Annual Report
2022

2 DIRECTORS’
REPORT
2 5 Year Summary
4 About the Company
6 Review of Operations
and Activities
12 Top 25 Investments
13 Company Position
14 Board Members
17 Senior Executives
18 Remuneration Report
32 Non-audit Services
33 Auditor’s Independence
Declaration

34 FINANCIAL
STATEMENTS
35 Consolidated Income Statement
36 Consolidated Statement of
Comprehensive Income
37 Consolidated Balance Sheet
38 Consolidated Statement
of Changes in Equity
40 Consolidated Cash Flow
Statement
41 NOTES TO
THE FINANCIAL
STATEMENTS
41 A. Understanding AFIC’s
Financial Performance
45 B. Costs, Tax and Risk
48 C. Unrecognised Items
49 D. Balance Sheet
Reconciliations
51 E. Income Statement
Reconciliations
52 F. Further Information
58 DIRECTORS’
DECLARATION
59 INDEPENDENT
AUDIT REPORT
64 OTHER
INFORMATION
64 Information About Shareholders
64 Major Shareholders
65 Sub-underwriting
65 Substantial Shareholders
65 Transactions in Securities
66 Major Transactions in the
Investment Portfolio
67 Holdings of Securities
69 Holdings of International
Securities
70 Issues of Securities
72 Company Particulars
73 Shareholder Information
Australian Foundation Investment Company Limited ABN 56 004 147 120
Contents
AUSTRALIAN FOUNDATION
INVESTMENT COMPANY
IS A LISTED INVESTMENT
COMPANY INVESTING
IN AUSTRALIAN AND
NEW ZEALAND EQUITIES.

Year in Summary
* Assumes a shareholder can take full advantage of the franking credits.
Profit for
the Year
$360.6m
$235.1m in 2021.
Up 53.4%
Total
Shareholder
Return
0 .1%
Share price plus
dividend, including
franking*
Management
Expense
Ratio
0.16%
0.14%
in 2021
Total
Portfolio
Return
-6.8%
Including franking*
S&P/ASX 200
Accumulation Index
including franking*
-5.1%
Fully
Franked
Dividend
14
¢
Final
24
¢
Total
24 cents total
in 2021
2022
Total
Portfolio
$8.2b
Including cash
at 30 June.
$9.1 billion in 2021
1Australian Foundation Investment Company Limited Annual Report 2022

DIRECTORS’ REPORT
5 Year Summary
Net Profit After Tax
($ Million)
Net Profit Per Share
(Cents)
Dividends Per Share
(Cents)
(b)
Investments at Market Value
($ Million)
(d)
Net Asset Backing Per Share
($)
(e)
Number of Shareholders
(30 June)
272.2134.2
(a)
279.0
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
240.4
6.49
6.27
5.96
138,671
129,948
153,588
32
(c)
24
24
24
34.0
23.6
19.9
7,566
7,274
7,122
235.1
19.38,978
360.629.4
247.45159,500
246.63164,979
8
(c)
8,087
Notes
(a) Participation in the Rio Tinto and BHP off-market share buy-backs, special dividends and the receipt of a dividend because of the Coles
demerger from Wesfarmers.
(b) All dividends were fully franked. The LIC attributable gain attached to the dividend was 2022: 14.29 cents, 2021: 4.29 cents, 2020: 7.14 cents,
2019: 7.14 cents, 2018: 2.86 cents.
(c) 8 cents fully franked special dividend paid with the interim dividend.
(d) Excludes cash.
(e) Net asset backing per share based on year-end data before the provision for the final dividend. The figures do not include a provision for capital
gains tax that would apply if all securities held as non-current investments had been sold at balance date as Directors do not intend to dispose
of the portfolio.
Net Profit After Tax
($ Million)
Net Profit Per Share
(Cents)
Dividends Per Share
(Cents)
(b)
Investments at Market Value
($ Million)
(d)
Net Asset Backing Per Share
($)
(e)
Number of Shareholders
(30 June)
272.2134.2
(a)
279.0
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
240.4
6.49
6.27
5.96
138,671
129,948
153,588
32
(c)
24
24
24
34.0
23.6
19.9
7,566
7,274
7,122
235.119.38,978
360.629.4
247.45159,500
246.63164,979
8
(c)
8,087
2Australian Foundation Investment Company Limited Annual Report 2022

About the Company
Australian Foundation Investment Company (AFIC) is a listed investment company
investing in Australian and New Zealand equities.
Investment Objectives
The Company aims to provide shareholders with attractive
investment returns through access to a growing stream
of fully franked dividends and growth in capital invested.
The Company’s primary investment goals are:
• to pay dividends which, over time, grow faster than
the rate of inflation; and
• to provide attractive total returns over the medium
to long term.
How AFIC Invests – What We Look For in Companies
A portfolio that
is managed to
achieve long term
capital and dividend
growth
Quality FirstGrowth
Including dividends
Value
Approach to Investing
Investment Philosophy
The investment philosophy is built
on taking a medium to long term view
on companies in a diversified portfolio
with an emphasis on identifying quality
companies that are likely to sustainably
grow their earnings and dividends over
this time frame.
Quality in this context is an outcome
of our assessment of the board and
management as well as some key
financial metrics. These include
return
on capital employed, return on equity,
the level of gearing in the balance
sheet, margins and free cash flow. The
structure of the industry and a company’s
competitive position in this industry is also
an important indicator of quality. Linked to
this assessment of quality is the ability
of companies to grow earnings over time,
which ultimately should produce good
dividend growth.
Recognising value is also an important
aspect of sound long term investing.
Short term measures such as the price
earnings ratio, price to book or price to
sales may be of some value, but aren’t
necessarily strong predictors of future
performance. Our assessment of value
tries to capture the opportunity a business
has to prosper and thrive over the
medium to long term.
In building the investment portfolio in this
way, we believe we can offer investors a
well-diversified portfolio of high-quality
companies that is intended to deliver total
returns ahead of the Australian equity
market and with less volatility over
the long term.
The Company also uses options
written against a small proportion of its
investments and a small trading portfolio
to generate additional income.
From time to time, some borrowings
may be used where potential investment
returns justify the use of debt. This is
managed within very conservative limits,
as determined by the Board.
AFIC is managed for the benefit of its
shareholders with fees based on the
recovery of costs rather than as a fixed
percentage of the portfolio. There are no
performance fees. As a result, the benefit
of scale over time results in a very low
expense ratio for investors. For the
12 months to 30 June 2022 this was
0.16 per cent, or 16 cents for each
$100 invested.
Approach to Environmental, Social
and Governance (ESG) Issues
Environmental, Social and Governance
(ESG) issues are taken into account as
part of our investment process when
assessing companies. As a long term
investor, we seek to invest in companies
that have strong governance and risk
management processes, which includes
consideration of environmental and social
risks given the potential for these factors
to impact investment performance.
We are also closely monitoring the
development of international standards
for ESG reporting, as these may further
inform our approach going forward.
4Australian Foundation Investment Company Limited Annual Report 2022

We regularly review and meet with
companies to ensure ongoing alignment of
ESG issues with our investment framework:
• We believe environmental factors,
including the impact of climate change,
can have a material impact on society.
These factors are considered when
assessing a company’s assets, long
term sustainability of earnings and cash
flow, cost of capital and future growth
opportunities.
As reporting becomes more
standardised, assessment of
commitments and plans by companies
to reach net zero by 2050 will also
be considered having regard to the
industry in which it operates, their
progress against these plans and their
broader contribution to social good in
addressing the challenge of reducing
global carbon emissions. In applying
external data for benchmarking*, the
current carbon intensity of AFIC’s
portfolio is considerably less than
the S&P/ASX 200 Index.
• We believe that aligning ourselves
with high-quality management and
boards building sustainable long term
businesses is the best approach to
avoiding socially harmful businesses.
We are attracted to companies
that act in the best interest of all
their stakeholders, including their
employees, customers, suppliers and
wider communities. Where appropriate,
we consider a range of matters
including safety, diversity and modern
slavery as part of the investment
process.
• We invest in high-quality companies
with strong governance processes,
and management and boards whose
interests are closely aligned with
shareholders. The investment process
includes an assessment of their
past performance, history of capital
allocation, level of accountability,
mix of skills, relevant experience and
succession planning. We also closely
scrutinise a company’s degree of
transparency and disclosure.
Engagement with Companies
Voting on resolutions is one of the key
functions that a shareholder has in
ensuring better long term returns and
management of investment risk:
• We take input from proxy advisers
but conduct our own evaluation
of the merits of any resolution.
• We vote on all company resolutions as
part of our regular engagement with the
companies in the portfolio. Our voting
record is on the Company’s website.
• We actively engage with companies
when we have concerns those
resolutions are not aligned with
shareholders’ interests. We
acknowledge that high-quality
companies may face ESG challenges.
We seek to stay engaged with the
companies and satisfy ourselves that
the issues are taken seriously and
worked through constructively. Ideally,
in this instance, we seek to remain
invested to influence a satisfactory
outcome for stakeholders.
* Data provided by ISS ESG.
Portfolio at 30 June 2022.
5Australian Foundation Investment Company Limited Annual Report 2022

Profit and Dividend
The full year profit was $360.6 million,
up from $235.1 million in the previous
corresponding period. The profit to
30 June 2022 includes a dividend of
$74.9 million (which was non-cash but
carries franking credits with it) resulting
from the BHP Petroleum/Woodside
merger. Last year’s figure included a
demerger dividend of $36.5 million
resulting from the Endeavour Group
demerger from Woolworths. Excluding
both one-offs, the full year profit
for the financial year to 30 June
2022 was $285.7 million, up from
$198.6 million in the previous
corresponding period. The increase
in profit for the 2021–2022 financial
year was driven by higher dividends
received from investee companies.
Earnings per share for the financial year,
excluding the BHP Petroleum/Woodside
merger non-cash dividend, were
23.3 cents per share. The final dividend
was maintained at 14 cents per share
fully franked bringing total fully franked
dividends applicable for the year to
24 cents per share, the same as last year.
Ten cents of the final dividend were
sourced from taxable capital gains,
on which the Company has paid or
will pay tax. The amount of the pre-tax
attributable gain on this portion of the
dividend, known as an ‘LIC capital gain’,
is equal to 14.29 cents per share. The
enables some shareholders to claim
a tax deduction in their tax return.
Market and Portfolio
Performance
Following on from the recent strong share
market returns since monetary policy was
eased and significant fiscal stimulus was
introduced in response to the COVID-19
pandemic, the Australian share market
continued to enjoy strong positive returns
in the first six months of the financial
year as interest rates remained low and
valuations for many companies were very
high. These conditions were eventually
overwhelmed in the second half of the
financial year as inflation emerged, driving
interest rates higher. Geopolitical events
further exacerbated market volatility
producing a significant divergence of
returns across the market.
Figure 1 provides some context to the
market decline over the financial year to
30 June 2022 given market movements
since the onset of the initial COVID-19
pandemic in 2019.
Overall, the S&P/ASX 200 Accumulation
Index (including franking) fell 5.1 per cent
over the 12 months to 30 June 2022 as
there was a rotation away from quality
growth stocks to a focus on short term
value. The previously underperforming
Utilities sector was up 36.0 per cent
over the period and Energy, which
responded to rising oil prices resulting
from Russia’s invasion of the Ukraine,
was up 30.1 per cent. In contrast,
previous strong-performing sectors such
as Information Technology and Consumer
Discretionary were down 38.2 per cent
and 20.9 per cent respectively (Figure 2).
The portfolio had a negative return of
6.8 per cent including franking, with the
largest drag on performance being the
decline in the valuation of many high-
quality companies from their previous
very high levels. We remain convinced
about the prospects for these companies
despite the recent decline in share prices.
In addition, relative performance to the
Index was impacted by the underweight
position in resources, which includes
energy stocks, and the sale of Sydney
Airport and Milton Corporation because
of takeovers which generated a significant
amount of capital gains tax.
6Australian Foundation Investment Company Limited Annual Report 2022
Review of Operations and Activities

8,000
7,500
7,000
6,500
6,000
5,500
5,000
4,500
4,000
20192020
Financial Years
20212022
Fiscal and monetary
policy stimulus
provided globally
Onset of
COVID-19
Central banks start
policy tightening
Figure 1: Performance of the S&P/ASX 200 Price Index – 3 Years to 30 June 2022
10 year return
Net asset per share growth plus dividends,
including franking
S&P/ASX 200 Accumulation Index,
including franking
1 year return3 year return5 year return
6.0%
4.6%
-6.8%
-5.1%
8.4%
8.3%
10.5%
10.9%
Figure 3: Portfolio Performance – Per Annum Returns to 30 June 2022
Companies in the portfolio that
performed relatively well against the
Index through the 12-month period
were Amcor, Sydney Airport (now taken
over), Transurban Group, Ramsay Health
Care, which is currently subject to an
expression of interest offer, Macquarie
Group and Computershare.
The long term performance of the
portfolio, which is better aligned with
the Company’s investment time frames,
was 10.5 per cent per annum for the
10 years to 30 June 2022 (Figure 3).
The Index return over the same period
was 10.9 per cent per annum. These
figures include the benefit of franking.
AFIC’s performance numbers are after
costs. Performance has been achieved
with low portfolio turnover, providing very
tax effective returns for shareholders
and with more consistent dividends.
These returns have also been delivered
with very low volatility, achieving an
attractive profile of return relative
to risk for investors.

Energy
Information
Technology
Consumer
Discretionary
MaterialsIndustrialsUtilities
Jul 21
Aug
21
Sep
21
Oct 21
Nov 21
Dec 21
Jan 22
Feb 22
Mar 22
Apr 22
May 22
Jun 22
150
140
130
120
110
100
90
80
70
60
50
Index
S&P/ASX 200 Accumulation Indices
Figure 2: Key Sector Performance for the 12 Months to 30 June 2022
Source: FactSet
7Australian Foundation Investment Company Limited Annual Report 2022

Positioning the Portfolio
The majority of purchases during the
year focused on increasing weightings
to existing holdings including Transurban
Group, CSL, Domino’s Pizza Enterprises,
Coles Group, Goodman Group, Carsales.
com and Auckland International Airport.
We also initiated positions in JB Hi-Fi,
Mirvac Group and a small holding in
WiseTech Global. JB Hi-Fi is the largest
consumer electronics retailer in Australia
and New Zealand. While primarily
providing attractive income to the portfolio
we expect the consumer electronics
category to continue delivering
meaningful growth.
Mirvac Group is a diversified property
company with operations across
residential, commercial and industrial
markets. Mirvac Group’s in-house
property development capability is
relatively unique to the sector and
provides a competitive advantage.
The company’s growth is largely sourced
from product generation and less reliant
on acquiring established assets.
During the 12-month period we exited
Qube Holdings, APA Group, Lifestyle
Communities, Origin Energy, Endeavour
Group and Altium. We are observing
structural industry challenges for many
of these companies or an environment
where competitive intensity has materially
increased. We consider the growth
prospects for all these companies to
be increasingly challenged as a result.
Additionally, we exited our holding in
Milton Corporation and Sydney Airport
as a result of takeovers.
The ability to reinvest the cash from these
takeovers was important during the year
as these funds were deployed elsewhere
in the portfolio in companies with good
long term growth opportunities.
We seek to have a diversified portfolio
that covers a range of sectors and
industries. This also allows us to better
spread risk through different market
cycles. Figure 4 highlights the profile
of AFIC’s portfolio by the various sectors
of the market at the end of the financial
year and how it differs from the Index.
International Portfolio
We have continued to manage and
carefully add to positions in the diversified
global equities portfolio which was
first initiated in May 2021. Through
a combination of these additional
investments and portfolio returns, we
now have approximately $89.2 million
invested (which represents approximately
1.1 per cent of the portfolio).
Leveraging our investment philosophy
in the domestic market, the approach
to international equities is similar. The
international strategy invests in publicly
listed companies outside the Australian
and New Zealand markets with a medium
to long term investment time horizon.
It focuses on high-quality companies
with strong management teams and
competitive advantages that we view
Review of Operations and Activities
continued
AFIC portfolio weightS&P/ASX 200 Index weight
18.6%14.8%14.5%12.7%9.1%6.9%0.0%5.9%3.3%5.1%1.7%3.0%4.5%
25%
20%
15%
10%
5%
0%
Banks
Healthcare
Materials
Industrials
Other
Financials
Consumer
Discretionary
Consumer
Staples
Communication
Services
Information
Technology
Energy
Real
Estate
Cash
Utilities
Figure 4: AFIC Investment by Sector Versus the S&P/ASX 200 Index
as at 30 June 2022 – Excludes International Holdings
15%
-10%
-5%
0%
5%
10%
20%
Jun 1
1
Jun 1
2
Jun 1
3
Jun 1
5
Jun 1
4
Jun 1
6
Jun 1
7
Jun 1
8
Jun 19Jun 20Jun 21Jun 22
Figure 5: Share Price Premium/Discount to Net Asset Backing
8Australian Foundation Investment Company Limited Annual Report 2022

as sustainable, often underpinned by long
term secular growth trends. With inherent
business characteristics that allow these
companies to generate an attractive
return on capital, the selected companies
are expected to generate a reasonable
level of return for our shareholders
through a combination of earnings growth
and dividends. We look to invest at a
starting valuation that is sensible in the
context of the expected return and the
risk associated with each investment.
This activity is potentially a precursor
to establishing a separate low-cost
international Listed Investment
Company in the future.
9Australian Foundation Investment Company Limited Annual Report 2022

Share Price Return
The share price return, including
reinvestment of dividends and franking
credits, over the 12 months to 30 June
2022 was flat at 0.1 per cent, which is
ahead of the portfolio return for the year.
The share price was trading at a premium
of 13 per cent to the net asset backing
(before tax on unrealised gains) at the
end of June 2022, whereas at 30 June
2021 the premium was 5 per cent
(Figure 5 previous page).
Importantly, the long term, 10-year
return is 12.2 per cent for the share price
in comparison to 10.9 per cent for the
Index (Figure 6). The figures for the Index
and share price assumes a shareholder
can take full advantage of the franking
credits attached to the dividends paid.
Outlook
During the year strengthening demand
produced supply chain challenges in
many industries, which contributed to a
meaningful increase in reported inflation.
In endeavouring to achieve price stability,
central banks signalled the end of
stimulatory policy settings. Equity markets
are now facing challenges on multiple
fronts, slowing economic growth, inflation
and interest rate hikes. As a result, the
uncertain environment that produced a
fall in equity markets during the financial
year is unlikely to be materially different
in the short term.
While the market has moved closer to
long term value as measured by price
to sales ratio (Figure 7) and price to
book ratio (Figure 8) we are comfortable
with the current portfolio settings and
can afford to be patient with our capital
until attractive opportunities present
themselves.
In this context it is also worth noting
even though the valuation of the market,
as measured by price earnings ratio
(Figure 9), has moved well below the
long term average it is against the
background of very high profit margins
which may come under pressure in
the near term given expected difficult
economic conditions.
Review of Operations and Activities
continued
10 year return
Share price growth plus dividends,
including franking
S&P/ASX 200 Accumulation Index,
including franking
1 year return3 year return5 year return
11.6%
4.6%
0.1%
-5.1%
11.3%
8.3%
12.2%
10.9%
Figure 6: Share Price Return − to 30 June 2022
Directorship Matters
Mr Peter Williams, a Non-Executive
Director of the Company has advised that
he will not seek re-election at the 2022
Annual General Meeting and will retire
at the conclusion of the meeting to be
held on 4 October 2022.
Mr Williams has been a Director since
2010 and is currently the Chairman of the
Audit Committee and a member of the
Investment and Nomination Committees.
Mr Williams is also the Non-Executive
Chairman of the Company’s subsidiary,
Australian Investment Company
Services Limited.
The Board has greatly benefited from
Mr Williams’ extensive experience. The
Board wishes to record its thanks to Peter
for his significant contribution and service
to the Board during his tenure and wish
him well for the future.
20022007201220172022
Times
2.4
2.0
1.6
1.2
Average
1.9
Figure 7: Valuation of the Market – Price to Sales of the S&P/ASX 200 Index
Source: FactSet
10Australian Foundation Investment Company Limited Annual Report 2022

22
20
18
16
14
12
10
8
20022003200420052006200720082009201020112012201320142015201620172018201920202021
Times
Average
14.5
Figure 9: Valuation of the Market – Price to Earnings Ratio of the S&P/ASX 200 Index
Source: FactSet
20022007201220172022
Times
Average 1.9
3.0
2.5
2.0
1.5
1.0
Figure 8: Valuation of the Market – Price to Book of the S&P/ASX 200 Index
Source: FactSet
11Australian Foundation Investment Company Limited Annual Report 2022

Includes investments held in both the Investment and trading portfolios.

Value at Closing Prices at 30 June 2022
Total Value
$ Million
% of the
Portfolio
1Commonwealth Bank of Australia714.08.8
2CSL 638.17.9
3BHP Group 574.47.1
4Transurban Group 414.05.1
5Macquarie Group 363.04.5
6Wesfarmers 309.03.8
7National Australia Bank 305.53.8
8Westpac Banking Corporation303.13.7
9Woolworths Group 255.43.2
10Amcor209.32.6
11Mainfreight 206.52.6
12Rio Tinto 191.22.4
13Telstra Corporation 187.42.3
14Australia and New Zealand Banking Group 187.02.3
15Woodside Energy Group* 184.92.3
16James Hardie Industries166.62.1
17Coles Group 160.72.0
18Goodman Group157.61.9
19Carsales.com 147.61.8
20ResMed 145.81.8
21ASX 117.01.4
22Ramsay Health Care 115.91.4
23Sonic Healthcare 109.61.4
24Computershare 99.61.2
25Brambles 99.41.2
Total6,362.7
As percentage of total portfolio value (excludes cash)78.7%
* Indicates that options were outstanding against part of the holding.
Top 25 Investments
As at 30 June 2022
12Australian Foundation Investment Company Limited Annual Report 2022

Capital Changes
The following changes occurred to the
Company’ share capital during the year:
• Under the Company’s Dividend
Substitution Share Plan, 687,032 new
shares were issued at nil cost in August
2021 and 557,809 new shares were
issued at nil cost in February 2022.
• Under the Company’s Dividend
Reinvestment Plan, 4,507,509 new
shares were issued at a price of
$8.10 in August 2021 and 3,317,169
new shares were issued at a price
of $7.86 in February 2022.
The Company’s buy-back facility remains
open although no shares were bought
back during the year.
The Company’s contributed equity, net
of share issue costs, rose $62.4 million
to $3.1 billion. At the close of the year the
Company had 1,230 million shares on issue.
Dividends
Directors have declared a fully franked
final dividend of 14 cents per share,
the same as last year.
The dividends paid during the year ended
30 June 2022 were as follows:
$’000
Final dividend for the year
ended 30 June 2021 of
14 cents fully franked
at 30 per cent paid
31 August 2021165,339
Interim dividend for the year
ended 30 June 2022 of
10 cents per share fully
franked at 30 per cent,
paid 25 February 2022118,215
283,554
Dividend Substitution
Share Plan (DSSP)
The Company has in place a Dividend
Substitution Share Plan.
This enables shareholders to elect to
receive shares in the Company instead
of dividends, forgoing any franking credit
and LIC gains that would otherwise be
attached to the dividend but deferring any
tax due on the receipt of such shares (for
Australian tax payers) until such time as
the shareholding is sold. Shareholders will
need to seek their own taxation advice in
determining if this plan is suitable for them.
Further details are available on the
Company’s website or by request from
the Company’s Share Registrar.
Financial Condition
The Company’s primary source of funds
consists of its shareholders’ funds.
The Company also had agreements with
Commonwealth Bank of Australia and
National Australia Bank for loan facilities
totalling $130 million (see Note D2).
As at 30 June 2022, the facilities were
drawn down by $10 million. The Board
takes a prudent and conservative
approach to the use of borrowed funds.
Currently, when used, they are maintained
within a limit of 10 per cent of total assets.
Listed Investment Company
Capital Gains
Listed Investment Companies (LIC)
which make capital gains on the sale of
investments held for more than one year
are able to attach to their dividends an
LIC capital gains amount which some
shareholders are able to use to claim a tax
deduction. This is called an ‘LIC capital
gain attributable part’. The purpose of this
is to put shareholders in Listed Investment
Companies on a similar footing with
holders of managed investment trusts
with respect to capital gains tax on
the sale of underlying investments.
Tax legislation sets out the definition of
a ‘Listed Investment Company’ which
AFIC satisfies. Furthermore, from time
to time the Company sells securities out
of the investment portfolio held for more
than one year which may result in capital
gains being made and tax being paid.
The Company is therefore on occasion
in a position to be able to make available
to shareholders a LIC capital gain
attributable part with our dividends.
In respect of this year’s final dividend of
14.0 cents per share for the year ended
30 June 2022, it carries with it a 14.29 cents
per share LIC capital gain attributable part
(2021: 4.29 cents). The amount which
shareholders may be able to claim as a
tax deduction depends on their individual
situation. Further details are provided
in the dividend statements.
Likely Developments
The Company intends to continue
investing on behalf of its shareholders as
it has been doing since 1928. The results
of these investment activities will depend
upon the performance of the companies
and securities in which we invest. Their
performance in turn depends on many
economic factors (macro, which include
economic growth rates, inflation, interest
rates, exchange rates and taxation
levels and micro which includes industry
economics and competitive behaviour)
and their approach to, and management
of, material Environmental, Social
and Governance (ESG) risks.
We do not believe it is possible or
appropriate to make a prediction
on the future course of markets or
the performance of our investments.
Accordingly, we do not provide a forecast
of the likely results of our activities.
However, the Company’s focus is on
results over the medium to long term and
its twin objectives are to grow dividends at
a rate faster than inflation and to provide
shareholders with attractive capital growth.
Significant Changes in
the State of Affairs
Directors are not aware of any other
significant changes in the operations of
the Company, or the environment in which
it operates, that will adversely affect the
results in subsequent years.
Events Since Balance Date
The Directors are not aware of any matter
or circumstance not otherwise disclosed
in the financial statements or the Directors’
Report which has arisen since the end of
the financial year that has affected or may
affect the operations, or the results of those
operations, or the state of affairs of the
Company in subsequent financial years.
Environmental Regulations
The Company’s operations are such that
they are not directly materially affected by
environmental regulations.
Rounding of Amounts
The Company is of the kind referred to
in the ASIC Corporations (Rounding in
Financial/Directors’ Reports) Instrument
2016/191, relating to the ‘rounding off’ of
amounts in the Financial Report. Amounts
in the financial report have been rounded
off in accordance with that Instrument, to
the nearest thousand dollars, or in certain
cases, to the nearest dollar.
Corporate Governance
Statement
The Company’s Corporate Governance
Statement for the financial year ended
30 June 2022 will be found on the
Company’s website at:
afi.com.au/corporate-governance
As an overseas listed issuer on the
New Zealand Stock Exchange (NZX), the
Company is generally deemed to comply
with the NZX Listing Rules provided that
the Company remains listed on the ASX,
complies with the ASX Listing Rules and
provides the NZX with all the information
and notices that it provides to the ASX.
Company Position
13Australian Foundation Investment Company Limited Annual Report 2022

Chairman of the Investment Committee. Member of the Remuneration,
Nomination and Audit Committees. Non-Executive Director of the
Company’s subsidiary, Australian Investment Company Services
Limited (AICS).
Mr Paterson is a company Director who was appointed to the Board in
June 2005 and Chairman in 2018. He was a former Alternate Director of the
Company for Mr Campbell from April 1987 to June 2005. He is Chairman
of Djerriwarrh Investments Limited.
He was formerly a Director of Goldman Sachs JBWere and is a former
member of the Board of Guardians of Australia’s Future Fund.
Member of the Investment and Nomination Committees.
Ms Dee-Bradbury was appointed to the Board in May 2019.
Ms Dee-Bradbury was previously Chief Executive Officer/President
of Developed Markets (Asia Pacific and ANZ) for Mondelez from 2010
to 2014. Before joining Mondelez Ms Dee-Bradbury was Group CEO of
the global Barbeques Galore group, and has held other senior executive
roles in organisations including Maxxium, Burger King Corporation and
Lion Nathan/Pepsi Cola Bottlers. Ms Dee-Bradbury is a Non-Executive
Director of BlueScope Steel Limited (appointed April 2014), a Director of
Energy Australia Holdings following her appointment in April 2017 and a
member of Chief Executive Women and of the Women Corporate Directors
Foundation. Ms Dee-Bradbury was formerly a Non-Executive Director of
Grain Corp Limited (from 2014 to 2020) and Tower Limited (NZ) until her
resignation in 2016 and a former member of the Federal Government’s
Asian Century Strategic Advisory Board.
Member of the Investment Committee. Managing Director of AICS.
Mr Freeman became Chief Executive Officer and Managing Director
in January 2018 having been Chief Investment Officer since joining the
Company in February 2007. Prior to this he was a Partner with Goldman
Sachs JBWere where he spent 12 years advising the investment
companies on their investment and dealing activities. He has a deep
knowledge and experience of investments markets and the Company’s
approaches, policies and processes. He is also Managing Director of
Djerriwarrh Investments Limited, Mirrabooka Investments Limited and
AMCIL Limited.
Non-Executive Director of the Company’s subsidiary, AICS. Member of the
Nomination Committee.
Mr Drummond was appointed to the Board in July 2021. He was appointed
as a member of the Financial Regulator Assessment Authority on
10 September 2021, and will serve a five-year term, concluding in 2026.
He is the President of the Geelong Football Club Limited, a board Director
of Transurban Co Ltd and a Governor of The Ian Potter Foundation.
Mr Drummond served as Chief Executive Officer of Medibank from July
2016 to May 2021. Prior to joining Medibank, he was Group Executive
Finance and Strategy of National Australia Bank (NAB), and Chief Executive
Officer and Country Head of Bank of America Merrill Lynch (Australia).
Earlier in his career, Mr Drummond held roles at Goldman Sachs JBWere
including Chief Operating Officer, Chief Executive Officer and Executive
Chairman.
John Paterson
Chairman and
Independent
Non-Executive
Director
BCom (Hons) (Melb),
CPA, F Fin
Rebecca
Dee-Bradbury
Independent
Non-Executive
Director
BBus, GAICD
Mark Freeman
Managing Director
BE, MBA, Grad Dip
App Fin (Sec Inst),
AMP (INSEAD)
Craig
Drummond
Independent
Non-Executive
Director
BCom (Melb),
SF FIN, FCA
Board Members
14Australian Foundation Investment Company Limited Annual Report 2022

Chairman of the Remuneration Committee.
Mr Liebelt was appointed to the Board in June 2012. He is Chairman of
Amcor Limited, a Director of Australia and New Zealand Banking Group
Limited, and a Director of Carey Baptist Grammar School. He is a Fellow
of the Australian Academy of Technological Sciences and Engineering and
a Fellow of the Australian Institute of Company Directors. He was formerly
Chairman and Director of DuluxGroup Limited, Chairman and Director of
the Global Foundation, Deputy Chairman of Melbourne Business School
and Managing Director and CEO of Orica Limited.
Member of the Audit Committee.
Ms Fahey was appointed to the Board in April 2021. She has over 30 years
of experience in technology, including in major organisations such as
Western Mining, Exxon, Roy Morgan, General Motors and SAP, covering
consulting, software vendor and Chief Information Officer roles. In addition
to her industry experience, she spent 10 years at KPMG as a partner
with the firm, during which time she held roles as National Lead Partner
Telecommunications, Media and Technology, and National Managing
Partner – Markets. Ms Fahey was also a member of the KPMG National
Executive Committee.
Ms Fahey is a Non-Executive Director of Seek Limited, IRESS Limited,
Datacom Group Limited, CenITex, Partners Life and a member of the
Australian Red Cross Blood Service Board and the La Trobe University
Council. She was formerly a Non-Executive Director of Vocus Group
Limited and Yooralla.
Chairman of the Nomination Committee. Member of the Investment,
Remuneration and Audit Committees.
Mrs Walter is an Australian lawyer and company Director. She was
appointed to the Board in August 2002. She is Chair of Melbourne
Genomics Health Alliance and Helen Macpherson Smith Trust. Mrs Walter
is also a Director of Export Finance Australia and the RBA’s Payments
System Board. She was formerly Chair of Federation Square Pty Ltd,
Australian Synchrotron Company Ltd and the Financial Adviser Standards
and Ethics Authority (FASEA). She was also Deputy Chair of Victorian
Funds Management Corporation and a Director of ASX, National Australia
Bank Ltd, Orica Ltd and Melbourne Business School.
Member of the Audit and Investment Committees.
Mr Peever was appointed to the Board in November 2013. He was
Managing Director of Rio Tinto Australia from 2009 to 2014. He is Chairman
of Brisbane Airport Group Pty Ltd. He chaired the Minister of Defence’s
First Principles Review of Defence and following the acceptance of the
review by Government was Chair of the Oversight Board which helped
guide implementation (with Defence) of the Review’s recommendations.
Mr Peever was a Non-Executive Chairman of Naval Group Australia, a
former member of the Foreign Investment Review Board, a former Chair
of Cricket Australia and a former Director of the Stars Foundation, a not
for profit body which promotes education of Indigenous girls and also
a former Vice Chairman of the Minerals Council of Australia and was
a Director of the Business Council of Australia.
Graeme R Liebelt
Independent
Non-Executive
Director
B Ec (Hons),
FAICD FTSE
Julie Fahey
Independent
Non-Executive
Director
BAS
Catherine
M Walter AM
Independent
Non-Executive
Director
LLB (Hons), LLM,
MBA (Melb), FAICD
David A Peever
Independent
Non-Executive
Director
BEc, MSC (Mineral
Economics)
15Australian Foundation Investment Company Limited Annual Report 2022

Board Members
continued
Meetings of Directors
The number of meetings of the Company’s Board of Directors and of each Board Committee held during the year ended 30 June 2022
and the numbers of meetings attended by each Director were:
BoardInvestmentAuditRemunerationNomination
Eligible
to AttendAttended
Eligible
to AttendAttended
Eligible
to AttendAttended
Eligible
to AttendAttended
Eligible
to AttendAttended
J Paterson12122020444422
M Freeman12122020-4
#
-4
#
--
RP Dee Bradbury12122019-4
#
--22
CM Drummond**1212-20
#
-4
#
-1
#
-1
#
JA Fahey1212-16
#
2*3----
GR Liebelt 1212-15
#
-3
#
44--
DA Peever 1212201943----
CM Walter12122020444422
PJ Williams1212202044-4
#
22
# Attended meetings as non-members.
* JA Fahey was appointed to the Audit Committee on 8 December 2021.
** CM Drummond appointed to the Nomination Committee on 23 June 2022.
Retirement, Election and Continuation in Office of Directors
Ms RP Dee-Bradbury, being eligible, will offer herself for re-election at the forthcoming 2022 Annual General Meeting.
Insurance of Directors and Officers
During the financial year, the Company paid insurance premiums to insure the Directors and officers named in this report to the extent
allowable by law. The terms of the insurance contract preclude disclosure of further details.
Chairman of the Audit Committee. Member of the Investment and
Nomination Committees. Non-Executive Chairman of the Company’s
subsidiary, AICS.
Mr Williams was appointed to the Board in February 2010. He is Chairman
of NAB Trustees Services Limited (NAB Subsidiary), Director of Cricket
Victoria Ltd and an Advisory Board Member of TLC Aged Care Limited.
Mr Williams was formerly Managing Director of Equity Trustees Limited,
Director and Treasurer of Foundation for Young Australians, a Director
of the Trustee Corporations Association of Australia, a Director of the
Australian Baseball Federation Inc, a Director of ARUMA (formerly House
with No Steps), and a General Manager with AXA/National Mutual in
Australia and Hong Kong. He was also a former Chairman of Olympic
Park Sports Medical Centre Pty Ltd and MIPS Advisory Committee for
Fiig Securities Limited.
Peter J Williams
Independent
Non-Executive
Director
Dip.All, MAICD, FAIM
16Australian Foundation Investment Company Limited Annual Report 2022

Senior Executives
Mr Porter joined the Company in January 2005. He is a Chartered
Accountant and has had over 25 years’ experience in accounting and
financial management both in the United Kingdom with Andersen
Consulting and Credit Suisse First Boston, and in Australia where he
was Regional Chief Operating Officer for the Corporate and Investment
Banking Division of CSFB. He is a Director of the Auditing and Assurance
Standards Board (AUASB) and a Director of the Anglican Foundation.
Mr Porter is a former Chair of The Group of 100 (G100), the peak body
for CFOs.
Mr Rowe joined the Company in July 2016. He is a Chartered Secretary
with over 16 years of experience in corporate governance with a particular
focus in listed investment companies. He was previously a corporate
governance advisor at a professional services firm which included acting
as Company Secretary for three ASX listed companies. Prior to that he
was the Company Secretarial Manager for a funds management company
based in the United Kingdom.
Andrew JB Porter
Chief Financial Officer/
Company Secretary
MA (Hons) (St And),
FCA, MAICD
Matthew Rowe
Company Secretary
BA (Hons), MSc Corp
Gov, FGIA, FCIS
Mr Driver joined the Company in January 2003. Previously, he was
with National Australia Bank Ltd for 18 years in various roles covering
business strategy, marketing, distribution, investor relations and business
operations. Mr Driver was formerly Chairman of Trust for Nature (Victoria).
Geoffrey N Driver
General Manager
Business Development
and Investor Relations
B Ec, Grad Dip Finance,
MAICD
17Australian Foundation Investment Company Limited Annual Report 2022

Contents
The Directors present AFIC’s 2022 Remuneration Report which outlines key aspects of our remuneration policy and remuneration
awarded this year.
Note on AFIC’s Proportion of the Costs Detailed in the Remuneration Report
The Remuneration Report is required to show the salary and incentives that the Group Executives receive. It does not accurately reflect
the actual cost to AFIC shareholders of this remuneration.
This is because other companies that the Executives provide services to (Djerriwarrh Investments Ltd, Mirrabooka Investments Ltd
and AMCIL Ltd, collectively ‘the LICs’) pay for a proportion of these costs.
The total remuneration shown in Table 4 is $3.7 million.
Of this, 46 per cent (or $1.7 million) is or will be actually paid for by the other LICs, through the service agreements with AFIC’s
subsidiary, Australian Investment Company Services Ltd (AICS).
Therefore, only 54 per cent, or $2.0 million, will be borne by AFIC and its shareholders.
This mirrors arrangements for all other AICS staff.
Note that with the proposed amalgamation of the Long Term Incentive Plan (LTIP) into the single Executive Incentive Plan (see Section E
of this report) from next year onwards, it is likely that the proportion of executive incentive that AFIC bears will decrease. This is because
currently the costs of the LTIP are charged 100 per cent to AFIC as it remunerates based on AFIC’s performance only, one of the
reasons that the Directors have decided to alter the remuneration structure.
The report is structured as follows:
1. Remuneration Policy, Link to Performance and Outcomes
2. Structure of Remuneration
3. Executive Remuneration Expense
4. Contract Terms
5. Non-Executive Director Remuneration
Appendix
A. Remuneration Governance
B. Annual Incentives: Details of Outcomes and Conditions
C. Long Term Incentives: Details of Outcomes and Conditions
D. Directors and Executives: Equity Holdings and Other Transactions
E. Proposed Changes to the Remuneration Structure
F. Detailed Performance Measures by Investment Company
1. Remuneration Policy, Link to Performance and Outcomes
1.1 What is Our Remuneration Policy?
AFIC is an investor in securities which are listed mainly in Australia and New Zealand. Our primary investment goals are to pay
dividends which, over time, grow faster than the rate of inflation and to provide attractive total returns over the medium to long term.
To achieve this, we need to attract and retain professional, competent and highly motivated executives and staff through offering
attractive remuneration arrangements which:
• reflect market conditions;
• recognise the skills, experience, roles and responsibilities of the individuals;
• align with shareholder interests; and
• align with the risk management strategies.
Generally, we seek to set total remuneration at the upper or second quartile of the sectors in which we operate.
Remuneration Report
18Australian Foundation Investment Company Limited Annual Report 2022

Remuneration for the Group’s executives has two main elements:
• fixed annual remuneration (FAR); and
• performance-related pay, being Annual Incentives and long term incentives (LTI).
FAR is determined with reference to levels necessary to recruit and retain staff with the relevant skills and experience in the industry in
which the Group operates. We utilise external input, seeking to ensure that the FAR meets these conditions. This includes industry data
provided by the Financial Institutions Remuneration Group Inc. (FIRG) and McLagan for the financial services industry. The costs of
the FAR (and the personal element of the Annual Incentive) are allocated to the LICs based on an internal estimate of work performed
which is subject to Board approval.
Through performance-related pay, the remuneration is adjusted to reflect the risks that the Company and its shareholders face and
how the Company has responded to those risks. In particular:
• The key performance indicators chosen to determine performance-related pay are those that the Company considers most relevant
to its objectives of improving shareholder wealth over the medium to long term, whilst also considering the relative levels of risk.
• The focus is on performance over the medium to long term, with only a small proportion of both Annual Incentives and LTI being
dependent on a single year’s performance.
• Executives agree to invest 25 per cent of the pre-tax annual cash incentive in AFIC shares and/or shares of the other investment
companies (AMCIL Limited, Djerriwarrh Investments Limited and Mirrabooka Investments Limited) and to hold these shares for
a minimum of four years.
The Board may, at its discretion, direct that any performance rights that are yet to vest or to be tested be cancelled in the event
of negative issues that arise, including material misstatement of the Company’s financial statements.
1.2 What is Our Target Remuneration Mix?
The target remuneration mix for executives is as follows:
Managing Director’s Target
Remuneration Mix
Annual incentive 40%
Long term incentive 10%
Fixed annual remuneration 50%
Other Executives’ Target
Remuneration Mix
Annual incentive 23%
Long term incentive 10%
Fixed annual remuneration 67%
1.3 How is the Remuneration Paid in 2022 Linked to Performance?
1.3.1 Fixed Remuneration
Most Executives received increases in their fixed annual remuneration this year. A review of the external evidence led Directors to the
conclusion that recent increases for Executives had not kept pace with the market. AFIC continues to operate in a highly competitive
market, and salary levels are reviewed at least annually with the aim of remunerating its executives to the extent required to attract
and retain executives who are leaders in their field.
The evidence also indicated that the total remuneration for the Managing Director was below the benchmark level that the Board
considered appropriate. Consequently, Directors decided to increase the amount of ‘at risk’ remuneration (which is predominantly
dependent on the performance of AFIC and the other LICs) whilst keeping the FAR unchanged.
19Australian Foundation Investment Company Limited Annual Report 2022

Remuneration Report
continued
1.3.2 Performance-related Pay
This section shows:
• How Annual Incentive measurements are split between AFIC and the other investment companies.
%Result
AFIC investment performance32Table 2
AFIC other metrics 8Table 1
Percentage of Annual Incentive determined by AFIC Performance40
Other LIC investment performance28Table 15
Other LIC other metrics12Table 15
Percentage of Annual Incentive determined by other LICs performance40
Total percentage of Annual Incentive determined by AFIC/Other LIC performance80
Personal metrics20n/a
100
See Table 5 for more details on the measures used in determining the Annual Incentives.
• The outcome for the long term incentive award (LTI) that was tested for vesting during the year are shown in Table 3.
Refer to Sections 2.2 and 2.3 for explanations of the measures used.
2022, as is noted elsewhere in the Annual Report, was a year of two distinct investment environments. AFIC outperformed strongly
in the first half, but the second saw AFIC underperform its benchmark as the market corrected. Resources, a sector in which AFIC is
underweight, strongly outperformed the S&P/ASX 200 Index (3.3 per cent accumulation return for the year compared to -6.5 per cent
for the broader S&P/ASX 200 Index). However, AFIC’s medium term performance continues to outperform the S&P/ASX 200 Index whilst
its longer term (10-year) performance is only marginally under the Index for the same period as seen in Table 2 – AFIC’s performance
includes fees whilst the Index returns take no account of fees.
Furthermore, many returns quoted by managed funds exclude either tax or expenses, or both. The use of ‘grossed-up returns’
(see Table 2 and Table 11) mitigates the tax disparity to some extent, as it adds back franking credits to the nominal dividend that
the Index pays, and also that AFIC pays.
The single-year underperformance caused by the sector rotations was mirrored by Mirrabooka and AMCIL, who also saw continued
outperformance against their relevant indices in the medium term and, in Mirrabooka’s case, the longer term. AMCIL’s medium term
five-year performance was in line and the 10-year gross NTA performance was slightly under the Index. AMCIL’s portfolio performance
(which excludes fees and taxes) over these periods was well ahead of the Index.
Djerriwarrh’s investment performance was below its benchmark for all periods tested (with the exception of its portfolio performance
over one year). However, its other key performance indicator (KPI) – to pay a higher yield than the S&P/ASX 200 Index offers –
significantly outperformed.
Earnings per share increased with the resumption of dividend and distribution payments by many companies. The figures used in
Table 1 exclude the demerger dividend last year as a consequence of the Endeavour demerger from Woolworths, and the merger
dividend received this year as a consequence of the Woodside/BHP Petroleum merger.
The management expense ratio (MER – see Table 11) continues to be of importance to the Board. As noted last year, it was expected
that expenses would increase due to a full year’s worth of costs for the international team and a higher proportion of incentives vesting
due to last year’s strong out-performance. The fall in the markets also increases the MER as it reduces the portfolio value which is the
denominator in the calculation. Notwithstanding these, the expenses (and the MER) were well within the range set by the Board.
The 2018 –2022 award under the Executive Long Term Incentive Plan was available for vesting as of 30 June 2022. However, the
calculations needed to determine how much actually vests are not performed until after the date of the Annual Report. Therefore, the full
amount that may vest is shown, and the actual settlement of the 2018–2022 award will take place in the year ended 30 June 2023. The
actual amount settled will be reported in the relevant year. The 2017– 2021 award vested in part for the year ended 30 June 2021. The
total shareholder return of AFIC was 13.8 per cent per annum over the four-year vesting period, which was above the target benchmark,
as independently verified by external consultants. The full 50 per cent available under this metric was therefore deemed to have vested.
The Total Portfolio Return over the same period was also ahead of its benchmark (10.6 per cent vs 9.8 per cent) but just below the top
quartile performance. Therefore 38 per cent of the 50 per cent available vested under this metric, and 12 per cent was forfeited.
Detailed information about the performance of each investment company is provided in Section E of the Appendix (Table 15).
20Australian Foundation Investment Company Limited Annual Report 2022

Table 1: Non-investment Return Performance Measures
Performance Measure
Benchmark
Result
AFIC
Result
Comparison to
Benchmark
Growth in net operating result 4.3%44.0%Favourable
Management expense ratio n/a0.16%Favourable
Outcome

Achieved

Partially achieved

Not achieved
Table 2: Investment Return Performance Measures
Measure
Benchmark
Result
AFIC
Result
Comparison to
Benchmark
Investment return – 1 year-6.5%-7.1%Unfavourable
Investment return – 3 years3.3%5.1%Favourable
Investment return – 5 years6.8%7.2%Favourable
Investment return – 10 years9.3%9.2%Unfavourable
Grossed-up return – 1 year-5.1%-6.8%Unfavourable
Grossed-up return – 3 years4.6%6.0%Favourable
Grossed-up return – 5 years8.3%8.4%Favourable
Grossed-up return – 10 years10.9%10.5%Unfavourable
Outcome

Achieved

Partially achieved

Not achieved
Table 3: Vesting and Forfeiture of Long Term Incentives During the Year
Award Date
Assessment
DatesMeasure Tested
Benchmark
ResultAFIC Result% Vested % Forfeited
ELTIP – Performance rights*
1 July 201730 June 2021Total gross shareholder return11.5%13.8%50%0%
Total portfolio return (TPR)9.8%10.6%38%12%
* Of the rights awarded on 1 July 2017, 12 per cent were forfeited as the relevant targets were not achieved (although AFIC exceeded the target for TPR
it was below the 75th percentile which would have led to full vesting) and 88 per cent vested.
1.3.3 Remuneration Outcomes
Table 4 discloses the actual remuneration outcomes received by the Company’s executives during the year and the LTI that may
vest in future years. These amounts are different to the statutory remuneration expense disclosed in Table 7. The Directors consider
the information about remuneration outcomes in Table 4 relevant for users because the statutory remuneration expense includes
accounting charges for long term incentives that may or may not be received in future years.
21Australian Foundation Investment Company Limited Annual Report 2022

Remuneration Report
continued
Table 4: Actual Executive Remuneration Outcomes
Total FAR
$
Annual
Incentive
$
Prior
Years’ LTI
Received*
$
Total
Remune-
ration
$
Total
Borne by
AFIC
$
Total
Borne
by Other
LICs
$
Annual
Incentive
Forfeited
$
LTI
Forfeited
$
Possible
Future LTI
(to Vest
Over Next
4 Years)
#
$
Mark Freeman – Managing Director
2022884,340468,346117,0341,469,720793,649676,071(239,126)(18,193)904,609
2021884,340409,53857,3331,351,211686,416664,795(32,632)(25,867)851,543
Andrew Porter – Chief Financial Officer
2022707,472161,940134,9561,004,368542,359462,009(85,675)(20,978)533,821
2021693,600190,97631,362915,938465,297450,641(17,104)(91,707)577,261
Geoff Driver – General Manager – Business Development and Investor Relations
2022582,624134,178111,203828,005447,123380,882(69,740)(17,286)439,685
2021571,200158,47425,842755,516383,802371,714(12,886)(75,767)475,533
Matthew Rowe – Company Secretary
2022309,00070,62248,535428,157231,205196,952(37,528)(7,544)219,551
2021300,00083,1429,838392,980199,634193,346(6,858)(28,772)226,533
The amount shown as forfeited for the LTI is the amount that would have been paid to Executives with respect to the 2017– 2021 LTIP in the event that
all targets had been achieved (2021: 2016 – 2020 LTIP). See Table 3. For 2021 for Mark Freeman, the amount also includes an element of the investment
team LTI that he was still eligible for, and the amount forfeited is the difference between the target amount that would have been paid if all targets were
met and the amount actually paid.
The value of Annual Incentive forfeited is the difference between the target amount and the amount awarded. See Table 10.
The differences between the amounts disclosed in Table 4 and the amounts in Table 7 are as follows:
* Prior year’s LTI received in Table 4 shows the value of performance shares that vested during the year, measured at the closing price on the day
that they were received. In respect of Mark Freeman for 2021, it shows the cash payment received in respect of LTIP vesting from his time as
Chief Investment Officer. In contrast, Table 7 shows the accounting expense recognised in relation to the LTI Plans during the year.
# The future LTI in Table 4 reflects potential future remuneration that may be received by the executives over the next four years if the performance
conditions are satisfied. This includes the estimated amounts payable under the LTIP Plans assuming the performance conditions will be satisfied
at the time of vesting. For accounting purposes, these amounts are recognised as expense over the vesting period. Note that a proportion of these
amounts will be forfeited if the proposed new incentive plan is adopted.
Information about Non-Executive Director remuneration is provided in Section 5 Non-Executive Director Remuneration.
During the year, the former Managing Director Ross Barker had 14,205 performance shares vest at a value of $128,302 and forfeited 1,948 at a value
of $19,902. Mr Barker no longer has any outstanding performance shares available for vesting.
2. Structure of Remuneration
2.1 Fixed Annual Remuneration (FAR)
The FAR component of an executive’s remuneration comprises base salary, superannuation guarantee contributions and fringe
benefits. Executives can elect to receive a portion of their FAR in the form of additional superannuation contributions or fringe benefits.
This will not affect the gross amount payable by the Group.
22Australian Foundation Investment Company Limited Annual Report 2022

2.2 Annual Incentive
Table 5 below outlines the key terms and conditions of the Annual Incentive plan.
Table 5: Annual Incentives – Key Terms and Conditions
Managing DirectorOther Executives
Targeted % of FAR 80 per cent35 per cent
ObjectivesAlign remuneration with the creation of shareholder wealth over the past year and over a longer period.
Measures reflect the management of the Group and the other investment companies, as well as the
key investment returns that reflect the creation of shareholder wealth.
Performance measures• Company performance (20 per cent); Investment performance (60 per cent); Personal objectives
(20 per cent)
• See Table 11 for more details
Relative weightings of investment
companies for investment and
company-related performance
AFIC: 40 per cent
Djerriwarrh Investments Limited: 16 per cent
AMCIL Limited: 12 per cent
Mirrabooka Investments Limited: 12 per cent
Personal objectives: 20 per cent (allocated on same basis as FAR)
Delivery of awardIncentive is paid in cash, but 25 per cent of the pre-tax amount received is used by recipients
to acquire shares in AFIC and/or the other investment companies which they agree to hold for
minimum of four years.
Performance measured in 2022One and 10-year measures either not achieved or partially achieved. All other measures achieved.
Outcomes for 2022
(see Table 10 for details)
66 per centAverage 66 per cent
The performance measures of each Annual Incentive plan are reviewed by the Remuneration Committee. The Committee may,
from time to time, revise the performance conditions and weightings in order to better meet the objectives of the Annual Incentive
policies. They may also change or suspend any part of the incentive payment arrangements. If relevant targets are not achieved but
performance is close to the target, some of the incentive may be paid. This would be noted as ‘partially achieved’ in Table 2. Where
stretch levels of performance are achieved above target, then higher amounts may be paid at the discretion of the Board. To date,
total Annual Incentives paid to each executive have never exceeded target.
For more detailed information about the Annual Incentive performance conditions and outcomes for 2022 please refer to Section B
Annual Incentives: Details of Outcomes and Conditions in the Appendix.
2.3 Long Term Incentive Plans (LTIP)
Table 6 outlines the purpose and the key terms and conditions of the plan.
Table 6: Long Term Incentives – Key Terms and Conditions
Executive LTIP
(Performance Rights)
Target 20 per cent of FAR for the Managing Director, 15 per cent for other Executives
ObjectivesAlign remuneration with growth in shareholder wealth over a forward-looking period of four years.
Reward outperformance.
Performance measuresSee Table 15 in the Appendix for details.
Performance for awards
tested in 2022 (Table 3)
2017– 2021: 88 per cent vested (see Table 3).
For more detailed information about the LTI plan and its performance conditions, including vesting schedules, please refer to Section C
Long Term Incentives: Details of Outcomes and Conditions in the Appendix. Note that the Directors are currently proposing that the LTIP
be amalgamated with the Annual Incentive into a single Executive Incentive Plan from 1 July 2022 onwards – see Section E. For details
of the previous Investment Team Long Term Incentive Plan that Mark Freeman was a participant in for the previous corresponding
period, please see the 2021 Annual Report, available on the Company’s website (afi.com.au).
23Australian Foundation Investment Company Limited Annual Report 2022

Remuneration Report
continued
3. Executive Remuneration Expense
This section discloses the remuneration expense recognised under accounting standards for each executive (Table 7). These amounts
are different to the remuneration outcomes disclosed in Table 4 as noted in that table.
Table 7: Remuneration Expense
Short Term
Post-
employment
Total Fixed
Remuneration
$
Short Term
Long Term
Share-based
Payments
Base Salary
$
Super-
annuation
$
Annual
Incentives
$
LTI Cash-
settled*
$
Other
Long Term
Payments*
$
Total
Remuneration
$
%
Fixed/
Performance
Related
Mark Freeman – Managing Director
2022856,84027,500884,340468,346271,066-1,623,75254%/46%
2021859,34025,000884,340409,538282,468(120,224)1,456,12261%/39%
Andrew Porter – Chief Financial Officer
2022679,97227,500707,472161,940115,976-985,38872%/28%
2021668,60025,000693,600190,976107,598-992,17470%/30%
Geoff Driver – General Manager – Business Development and Investor Relations
2022555,12427,500582,624134,17895,517-812,31972%/28%
2021546,20025,000571,200158,47488,423-818,09770%/30%
Matthew Rowe – Company Secretary
2022281,50027,500309,00070,62248,716-428,33872%/28%
2021275,47624,524300,00083,14248,345-431,48770%/30%
* Includes amounts credited for non-vesting.
4. Contract Terms
Each Executive is employed under an open-ended contract, the terms of which can be varied by mutual agreement. There are no
contractual provisions for cessation of employment other than statutory requirements. Either the Company or the Executive can give
notice in accordance with statutory requirements. There are no specific payments to be made as a consequence of termination beyond
those required by statute. Should there be any payments, these will be at the Board’s discretion.
Material breaches of the terms of employment will normally result in the termination of an Executive’s employment.
5. Non-Executive Director Remuneration
Shareholders approve the maximum aggregate amount of remuneration per year available to be allocated between Non-Executive
Directors (NEDs). In proposing the amount for consideration by shareholders, the Remuneration Committee takes into account the time
demands made on Directors together with such factors as the general level of fees paid to Australian corporate Directors.
For NEDs, who are charged with the responsibility of oversight of the Company’s activities, a fixed annual fee is paid with no element
of performance-related pay.
The amount approved at the AGM in October 2019 was $1,250,000 per annum, which is the maximum amount that may be paid in total
to all NEDs. Retirement allowances for Directors were frozen at 30 June 2004.
On appointment, the Company enters into a deed of access and indemnity with each NED. There are no termination payments due
at the cessation of office, and any Director may retire or resign from the Board, or be removed by a resolution of shareholders.
The amounts paid to each NED, and the figures for the corresponding period, are set out in Table 8.
24Australian Foundation Investment Company Limited Annual Report 2022

Table 8: Non-Executive Director Remuneration
Primary (Fee/
Base Salary)
$
Post-
employment
(Superannuation)
$
Total
Remuneration
$
J Paterson – Chairman
2022195,4554,545200,000
2021179,22217,028196,250
RE Barker – Non-Executive Director (retired 30 June 2021)
202189,6118,51498,125
RP Dee-Bradbury – Non-Executive Director
202295,4554,545100,000
202196,0102,11598,125
CM Drummond – Non-Executive Director (appointed 1 July 2021)
202290,9099,091100,000
JA Fahey – Non-Executive Director (appointed 22 April 2021)
202290,9099,091100,000
202117,5621,66819,230
GR Liebelt – Non-Executive Director
202297,7272,273100,000
202198,125-98,125
DA Peever – Non-Executive Director
202290,9099,091100,000
202189,6118,51498,125
CM Walter AM – Non-Executive Director
202290,9099,091100,000
202189,6118,51498,125
PJ Williams – Non-Executive Director
202290,9099,091100,000
202189,6118,51498,125
Total remuneration of Non-Executive Directors
2022843,18256,818900,000
2021749,36354,867804,230
Amounts Payable on Retirement
The amounts payable to the current NEDs who were in office at 30 June 2004, which will be paid when they retire, are set out in Table 9.
These amounts were expensed in prior years as the retirement allowances accrued.
Table 9: Non-Executive Director Retirement Allowance
Amount Payable on Retirement
$
CM Walter AM 42,385
Total42,385
25Australian Foundation Investment Company Limited Annual Report 2022

Remuneration Report
continued
Appendix
A. Remuneration Governance
Responsibilities of the Board and the Remuneration Committee
It is the Board’s responsibility to review and approve the recommendations of the Remuneration Committee.
For more information, the Charter of the Board is available on the Company’s website.
The Remuneration Committee’s primary responsibilities include:
• reviewing the level of fees for NEDs and the Chairman;
• reviewing the Managing Director’s remuneration arrangements;
• evaluating the Managing Director’s performance;
• reviewing the remuneration arrangements for other Senior Executives;
• monitoring legislative developments with regards to Executive remuneration; and
• monitoring the Group’s compliance with requirements in this area.
For more information, the Charter of the Remuneration Committee is available on the Company’s website.
The Remuneration Committee is composed of three NEDs (GR Liebelt (Chairman), J Paterson and CM Walter AM) and meets at least
twice per year.
Policy on Hedging
The Company provides no lending or leveraging arrangements to its executives, who are prohibited by Company policy from entering
into hedging arrangements that mitigate the possibility that ‘at risk’ incentive payments may not vest.
Use of Remuneration Consultants
The Managing Director makes recommendations to the Remuneration Committee with regards to the remuneration levels and structure
of the KMP.
Ernst & Young review the calculations used in determining the vesting of awards and certifies them as being correct and in accordance
with the terms and conditions of the ELTIP.
Ernst & Young were paid $7,365 (inclusive of GST) during the year ended 30 June 2022 for other general remuneration advice which
consisted of verifying the calculations used for the vesting of the ELTIP (2021: $17,510) and during the year the Group also paid
$162,063 for other professional advice received which included acting as the internal auditor for AICS and general taxation and
accountancy advice, including advice on the format and layout of the Remuneration Report (2021: $166,683) (all including GST).
Ernst & Young were remunerated on an invoiced basis, based on work performed.
The Company also participates in the annual McLagan and FIRG surveys of fund managers to understand current remuneration levels
and practices.
B. Annual Incentives: Details of Outcomes and Conditions
Table 10 below shows the Annual Incentives paid to individual executives as a result of AFIC’s and the other investment companies’
performance on financial metrics and the individual’s achievement of their own personal objectives. Table 11 sets out the detailed
terms and conditions of the Annual Incentives. For a high-level summary see Section 2.2 and Table 5.
Table 10: Annual Incentive Outcomes
Executive% of Target Paid$ Paid
% of Target
Forfeited$ Forfeited
Mark Freeman66.2%468,34633.8%239,126
Geoff Driver65.8%134,17834.2%69,740
Matthew Rowe65.3%70,62234.7%37,528
Andrew Porter65.4%161,94034.6%85,675
26Australian Foundation Investment Company Limited Annual Report 2022

Table 11: Executive Annual Incentive Performance Conditions
Performance Areas
and Relative WeightingPerformance MeasuresPurpose of Measure
Company performance (20 per cent)
The relevant weightings of the
investment companies are:
• AFIC: 50 per cent
• Djerriwarrh Investments Limited:
20 per cent
• AMCIL Limited: 15 per cent
• Mirrabooka Investments Limited:
15 per cent
• Operating result and dividend growth
– measured against prior years.
• Management expense ratio (MER):
at Board discretion, generally measured
against prior years’ results.
• Dividend yield (DJW only).
• Net operating result reflects the ability of the
Company to meet its stated aim of ‘paying out
dividends which, over time, grow faster than
the rate of inflation.’ The dividends of both MIR
and AMH vary from year to year and is not a key
objective for those companies. This metric is thus
not considered appropriate for them.
• MER reflects the costs of running the Company.
• Maintaining a dividend yield being above the
market’s is an important object for DJW.
Investment performance (60 per cent)
The relevant weightings of the
investment companies are:
• AFIC: 50 per cent
• Djerriwarrh Investments Limited:
20 per cent
• AMCIL Limited: 15 per cent
• Mirrabooka Investments Limited:
15 per cent
• Relative investment return: measure
of the return on the portfolio invested
(including cash) over the previous one,
three, five and 10 years, relative to
the S&P/ASX 200 Accumulation Index
(Combined S&P/ASX Mid Cap 50 and
Small Ordinaries for Mirrabooka and
modified S&P/ASX 200 Accumulation
Index for Djerriwarrh).
• Grossed-up return (GR): measure of
the movement in the net asset backing
of the Company (per share) plus the
dividends assumed to be reinvested
grossed up for franking credits over the
previous one, three, five and 10 years.
This return is compared to the S&P/ASX
200 Accumulation Index grossed up for
franking credits (Combined S&P/ASX
Mid Cap 50 and Small Ordinaries for
Mirrabooka and modified S&P/ASX 200
Accumulation Index for Djerriwarrh).
The Board considers that the metrics used reflect,
over the medium to long term, the stated objectives
of the Company, namely ‘to provide attractive total
returns and pay dividends, which, over time, grow
faster than the rate of inflation’.
• Investment return: reflects the returns generated
by the mix of the investments that the Company
has invested in. These reflect the value added to
shareholders’ wealth by the investment decisions
of the Company.
• Grossed-up return (GR): reflects the movement
in the value of the underlying portfolio over the
period with the additional recognition of the
importance of franking credits.
Note: The Remuneration Committee has discretion
to determine, at the time of the review, what it
considers to be the appropriate level of return
to be used.
Personal objectives (20 per cent)
These costs are allocated to AFIC
and to the LICs on the same
proportion as the FAR
Includes:
• advice to the Board;
• succession planning;
• management of staff;
• risk management; and
• shareholder stewardship.
These measures all contribute to the
efficient running of the Group, and the
other investment companies, enhancing
investment outcomes.
Personal objectives are included in incentive
calculations to encourage out-performance on
non-financial metrics. These metrics can be
important determinants of business success in
the medium term. The Managing Director reviews
the performance of each Executive with the
Remuneration Committee, and the Remuneration
Committee alone determines how the Managing
Director is performing against these objectives.
50 per cent is awarded based on the individual’s
capability and improvement and 50 per cent on
alignment with the Company’s values and culture.
27Australian Foundation Investment Company Limited Annual Report 2022

Remuneration Report
continued
C. Long Term Incentives: Details of Outcomes and Conditions
This section shows the outstanding cash bonuses under the ELTIP (Table 12). It also explains the detailed terms and conditions of the
Plan that are currently in operation (Table 13). For a high-level overview see Section 2.3 of the main body of the Remuneration Report.
Table 12: Vesting of ELTIP and Investment Team LTI
ELTIP
Award Date
Vesting Date
Subject to
Performance
Hurdles
Value at
Award Date
$
Number
of Rights
Awarded
Value
Per Right
$
Award Vested
for the Year
Number of
Rights/%
Value Yet to Vest
30 June 2022
$
Mark Freeman – Managing Director (from 1 January 2018)
1 Jan 201830 June 2021$85,00014,765$5.75712,984/87.9%-
1 July 201830 June 2022$170,00027,974$6.077-$245,976
1 July 201930 June 2023$173,40028,217$6.145-$238,997
1 July 202030 June 2024$176,86829,125$6.073-$237,480
1 July 202130 June 2025$176,86823,160$7.637-$182,156
$904,609
Andrew Porter – Chief Financial Officer
1 July 201730 June 2021$98,01617,026$5.75714,973/87.9%
1 July 201830 June 2022$99,97616,451$6.077-$144,245
1 July 201930 June 2023$102,00016,598$6.145-$140,587
1 July 202030 June 2024$104,04017,132$6.073-$139,695
1 July 202130 June 2025$106,12113,896$7.637-$109,294
$533,821
Geoff Driver – General Manager – Business Development and Investor Relations
1 July 201730 June 2021$80,76514,030$5.75712,338/87.9%
1 July 201830 June 2022$82,38013,556$6.077-$118,858
1 July 201930 June 2023$84,00013,669$6.145-$115,777
J July 202030 June 2024$85,68014,109$6.073-$115,043
1 July 202130 June 2025$87,39411,444$7.637-$90,007
$439,685
Matthew Rowe – Company Secretary
1 July 201730 June 2021$35,2506,123$5.7575,385/87.9%
1 July 201830 June 2022$37,8006,220$6.077-$54,538
1 July 201930 June 2023$41,2506,713$6.145-$56,855
1 July 202030 June 2024$45,0007,410$6.073-$60,422
1 July 202130 June 2025$46,3506,069$7.637-$47,736
$219,551
See Table 4 for actual amounts vested and Table 3 for details of vesting calculations.
The value of the outstanding ELTIP performance rights as in the table above was estimated at 30 June 2022 using the Total Shareholder
Return (TSR – which includes dividends reinvested) based on a closing price on 30 June 2022 of AFI shares of $7.51 (the TSR for AFI
at 30 June 2022 was 44.3 per cent p.a. for four years, 37.8 per cent p.a. for three years, 34.3 per cent for two years and 3.0 per cent
for one year).
Actual amounts awarded may vary from this amount, depending on performance over the four-year vesting period.
During the year, 68.9 per cent of the 2017– 2021 Investment Team Long Term Incentive that vested in the prior year was paid
to Mr Freeman.
28Australian Foundation Investment Company Limited Annual Report 2022

Table 13: Long Term Incentive Plans
ELTIP (Performance Rights)
Nature of grantRights to receive cash that must then be used (after tax) by the executives to acquire AFIC shares on market.
Performance conditions1. Total gross shareholder return (50 per cent): the movement in the AFIC share price, grossed up to reflect
the value of franking credits. This is compared to that of the market such that only outperformance is
rewarded. Outperformance of this index over time should be an indicator of the value added by the
Company to shareholders’ wealth. Both the Company’s return and the index return are smoothed over
30 days to remove excess volatility.
2. Total portfolio return (50 per cent): the movement in the net asset backing of the Company (per share)
plus the dividends paid by the Company reinvested. This compares AFIC’s investment performance
against that of other fund managers (based on the Mercer Investment Consulting Survey of Australian
Retail Fund Managers which provides the industry benchmark of funds management performance over
the relevant period), so that only outperformance relative to its peers is rewarded.
Note that from the 2020 – 2024 Plan onwards total gross shareholder return will be the only performance
condition. This is balanced by the removal of TSR from the Annual Incentive performance conditions.
Vesting schedule: total
gross shareholder return
Company performance relative to gross
accumulation indexPercentage of rights vesting
Underperformance 0 per cent
< or = 20 per cent outperformanceStraight line between 25 per cent and 50 per cent
> 20 per cent outperformance50 per cent
Vesting schedule:
total portfolio return
Company performance Percentage of rights vesting
Less than median performance0 per cent
Median to < or = 75th percentileStraight line between 25 per cent and 50 per cent
> 75 per cent percentile50 per cent
Valuation of
performance rights
At 1 July each year, the 30-day volume weighted average price of AFIC shares up to, but not including
1 July will be calculated. The amount of ELTIP available will then be divided by this average price to
determine the number of performance rights that may vest in four years’ time.
The value of the performance rights will be adjusted each year by the total shareholder return for the year,
calculated based on the 30-day volume weighted average price of AFIC shares up to 1 July. At vesting time,
the value of the performance rights that will vest is converted to cash, based on the value of the rights
at that time.
Accounting treatmentUnder current accounting standards, the ELTIP scheme is classified as a cash-settled scheme. The
expected amount payable upon vesting must therefore be estimated each year and adjusted not only
for the likelihood of vesting but also for changes in the value of the performance rights. In the first year,
25 per cent of the expected amount payable will be booked as an expense. At the end of the second year,
50 per cent of the new expected final value less the amount booked in the previous year will be booked.
At the end of the third year, 75 per cent of the total estimated final value less amounts previously expensed
will be booked. At the end of the fourth year, the actual liability will be calculated and a balancing
adjustment made.
For details of Incentive Plans that vested or were awarded in the comparative year, please see the 2021 Annual Report, available on the
Company’s website.
29Australian Foundation Investment Company Limited Annual Report 2022

Remuneration Report
continued
D. Directors and Executives: Equity Holdings and Other Transactions
Table 14 sets out reconciliations of shares issued by the Group and held directly, indirectly or beneficially by Non-Executive Directors
and Executives of the Group, or by entities to which they were related.
Table 14: Shareholdings of Directors and Executives
Opening
Balance
Changes
During Year
Closing
Balance
J Paterson615,332-615,332
RM Freeman160,1827,842168,024
RP Dee-Bradbury14,41324914,662
CM Drummondn/a38913,271
JA Fahey-1,2421,242
GR Liebelt527,708-527,708
DA Peever32,59198533,576
CM Walter366,80611,086377,892
PJ Williams49,756-49,756
GN Driver143,0897,438150,527
MJ Rowe5,7053,2778,982
AJB Porter176,3169,050185,366
CM Drummond became a Director on 1 July and therefore is not included in the opening balance which are at 30 June 2021.
Other Arrangements With Non-Executive Directors
Non-Executive Directors Craig Drummond, John Paterson and Catherine Walter have rented office space and, for John Paterson,
a parking space from the Group at commercial rates during the year. Sub-lease rental income (included in revenue) received or
receivable, including GST, by the Group during the year was:
Rental Income
Received/Receivable
$
CM Drummond11,263
J Paterson29,802
CM Walter15,941
E. Proposed Changes to the Incentive Scheme
The Directors propose a simplification of the Executive Incentive Schemes that would involve merging the Executive Long Term
Inventive Plan and the Annual Incentive Plan into a single Executive Incentive Plan.
The new plan will retain the performance measurements currently utilised in the Annual Incentive Plan with the addition of a reward/risk
component which will be measured over five years and compared to the Mercer Reward/Risk Survey of Australian fund managers.
It is important to note that therefore 50 per cent of the available incentive under the new scheme will be long term in nature
(and will be described as such in the Annual Report), as it measures investment performance over more than one year.
The remaining 50 per cent will be 20 per cent based on personal metrics for each Executive (as is currently the case) and 30 per cent
based on an annual scheme looking at investment performance and other financial metrics over a single year (but for the operating
earnings per share and MER measures to be reviewed in the context of longer term trends).
The Executive Incentive Scheme will be paid in cash, as is currently the case with the Annual Incentive Plan. It also remains the case
that Executives will be required to use 25 per cent of the pre-tax amount of any incentive that vests to purchase shares in AFIC and/or
the other LICs. Executives will be expected over time to build and to maintain an appropriate holding in not only AFIC shares but also
in shares in the other LICs to which AICS provides services.
The Directors consider that the scheme allows for sufficient ‘clawback’ in the case of a material misstatement of the Group’s financial
statements or in any other case where the Board considers that such remuneration would be an ‘inappropriate benefit’. In such
instances, the Board reserves the right to clawback some or all of the Executive’s proposed performance-based remuneration.
30Australian Foundation Investment Company Limited Annual Report 2022

The Directors, in their absolute discretion, may then take such clawback actions as they deem necessary or appropriate to address
the events that give rise to an ‘inappropriate benefit’. Such actions may include:
1. cancelling or requiring the forfeiture of some or all of the Executive’s incentive payments;
2. adjusting the Executive’s future performance-based remuneration;
3. dismissing the Executive and/or initiating legal action; and/or
4. any other action the Directors consider appropriate.
The Directors are not required to show loss to the Company in order to determine that an ‘inappropriate benefit’ should be subject
to clawback.
F. Detailed Performance Measures by Investment Company
Table 15 on the following page shows the performance of AFIC and the other investment companies over the past five years, including
details of total shareholder return (TSR), total portfolio return (TPR) and gross return (GR). These measures, which represent growth
in shareholder wealth, are used in part to determine the vesting of AFIC’s incentive plans to executives and the investment team.
Table 15: Detailed Performance Measures for AFIC and the Other Investment Companies
Year Ending 30 June
10-year
Return
5-year
Return
4-year
Return
3-year
Return 20222021202020192018
Comparative returns
S&P/ASX 200 Accumulation Return9.29%6.83%5.33%3.34%-6.47%27.80%-7.7%11.6%13.0%
Modified S&P/ASX 200 Accumulation*8.75%6.83%5.33%3.34%-6.47%21.71%---
Gross S&P/ASX 200 Accumulation Return10.86%8.26%6.72%4.58%-5.12%29.12%-6.6%13.4%14.6%
Modified Gross S&P/ASX 200
Accumulation Return*9.85%8.03%6.72%4.58%-5.12%22.64%---
Combined S&P/ASX Mid Cap 50 and
Small Ordinaries Accumulation Return
(used for Mirrabooka Investments Limited)8.86%6.67%3.72%4.02%-14.06%34.42%-2.6%2.8%19.3%
Gross Combined S&P/ASX Mid Cap 50
and Small Ordinaries Accumulation
Return (used for Mirrabooka
Investments Limited)9.80%7.49%4.47%4.70%-13.52%35.22%-1.9%3.8%20.4%
Yield on S&P/ASX 200 grossed up for
franking creditsn/an/an/an/a5.1%2.9%5.8%5.2%5.2%
Australian Foundation Investment Company Limited
Total gross shareholder return12.24%11.26%11.03%11.64%0.09%35.17%1.2%6.9%10.3%
Growth in net operating result per sharen/an/an/an/a44.0%-3.0%-41.5%44.1%9.6%
Management expense ration/an/an/an/a0.16%0.14%0.13%0.13%0.14%
Gross return10.51%8.38%7.33%6.01%-6.78%31.92%-3.1%11.4%12.7%
Investment return9.15%7.24%6.27%5.12%-7.08%30.28%-4.1%9.8%11.3%
Djerriwarrh Investments Limited
Growth in net operating profit per sharen/an/an/an/a30.9%-4.5%-26.0%3.7%5.7%
Management expense ration/an/an/an/a0.45%0.45%0.45%0.43%0.44%
Gross return8.56%5.51%4.02%2.36%-6.51%29.58%-11.5%9.1%11.7%
Investment return7.01%4.33%3.20%2.03%-6.21%25.83%-10.0%6.8%9.7%
Gross yield on NTA at end of June n/an/an/an/a6.5%4.7%5.6%8.6%8.6%
Mirrabooka Investments Limited
Management expense ration/an/an/an/a0.46%0.50%0.63%0.61%0.60%
Gross return12.72%9.74%7.86%8.54%-20.87%50.92%7.1%5.9%17.3%
Investment return12.52%9.36%7.81%8.84%-19.04%49.80%6.3%4.8%16.0%
AMCIL Limited
Management expense ration/an/an/an/a0.52%0.56%0.66%0.72%0.69%
Gross return10.31%8.22%6.79%6.72%-14.31%31.76%7.6%7.0%13.9%
Investment return10.57%8.75%7.49%8.07%-12.40%34.36%7.2%5.8%14.0%
* Note that the modified S&P/ASX 200 Index is used for the Djerriwarrh figures to take into account the effect that option writing has on the investment
return. It is a new measure and has not been calculated individually for prior years.
31Australian Foundation Investment Company Limited Annual Report 2022

Details of non-audit services performed by the auditors may be found in Note F2 of the Financial Report.
The Board of Directors has considered the position and, in accordance with the advice received from the Audit Committee, is satisfied
that the provision of the non-audit services is compatible with the general standard of independence for auditors imposed by the
Corporations Act 2001. The Directors are satisfied that the provision of non-audit services by the auditor, as set out below, did not
compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:
• all non-audit services have been reviewed by the Audit Committee to ensure they do not impact the impartiality and objectivity
of the auditor; and
• none of the services undermine the general principles relating to auditor independence as set out in the Corporations Act 2001
including reviewing or auditing the auditor’s own work, acting in a management or a decision-making capacity for the Company,
acting as advocate for the Company, or jointly sharing economic risk and rewards.
A copy of the Auditor’s Independence Declaration is set out on page 33.
This report is made in accordance with a resolution of the Directors.
John Paterson
Chairman
25 July 2022
Non-audit Services
32Australian Foundation Investment Company Limited Annual Report 2022

Auditor’s Independence Declaration
33Australian Foundation Investment Company Limited Annual Report 2022

FINANCIAL STATEMENTS
34 FINANCIAL
STATEMENTS
35 Consolidated Income Statement
36 Consolidated Statement of
Comprehensive Income
37 Consolidated Balance Sheet
38 Consolidated Statement of
Changes in Equity
40 Consolidated Cash
Flow Statement

41 NOTES TO
THE FINANCIAL
STATEMENTS
41 A. Understanding AFIC’s
Financial Performance
41 A1. How AFIC Manages
its Capital
41 A2. Investments Held and How
They Are Measured
42 A3. Operating Income
43 A4. Dividends Paid
44 A5. Earnings Per Share
45 B. Costs, Tax and Risk
45 B1. Management Costs
45 B2. Tax
46 B3. Risk
48 C. Unrecognised Items
48 C1. Contingencies
49 D. Balance Sheet
Reconciliations
49 D1. Current Assets – Cash
49 D2. Credit Facilities
49 D3. Revaluation Reserve
50 D4. Realised Capital
Gains Reserve
50 D5. Retained Profits
50 D6. Share Capital
51 E. Income Statement
Reconciliations
51 E1. Reconciliation of Net Cash
Flows From Operating
Activities to Profit
51 E2. Tax Reconciliations
52 F. Further Information
52 F1. Related Parties
52 F2. Remuneration of Auditors
53 F3. Segment Reporting
53 F4. Summary of Other
Accounting Policies
55 F5. Performance Bond
55 F6. Share-based Payments
56 F7. Principles of Consolidation
56 F8. Subsidiaries
57 F9. Lease Commitments
57 F10. Parent Entity
Financial Information
Annual Report 202234Australian Foundation Investment Company Limited

Consolidated Income Statement
For the Year Ended 30 June 2022
Note
2022
$’000
2021
$’000
Dividends and distributionsA3388,492257,874
Interest income from depositsA361116
Other revenueA34,8714,831
Total revenue393,424262,821
Net gains/(losses) on trading portfolio A36292,472
Income from operating activities394,053265,293
Finance costs(845)(1,831)
Administration expensesB1(19,165)(15,509)
Profit before income tax expense374,043247,953
Income tax expenseB2, E2(13,486)(12,858)
Profit for the year360,557235,095
Profit is attributable to:
Equity holders of Australian Foundation Investment Company Ltd360,537234,651
Minority interest20444
360,557235,095
CentsCents
Basic earnings per shareA529.4019.28
This Income Statement should be read in conjunction with the accompanying notes.
35Australian Foundation Investment Company Limited Annual Report 2022

Year to 30 June 2022Year to 30 June 2021
Revenue
1

$’000
Capital
1

$’000
Total
$’000
Revenue
1

$’000
Capital
1

$’000
Total
$’000
Profit for the year360,557-360,557235,095-235,095
Other comprehensive income
Items that will not be recycled through
the Income Statement
Gains/(losses) for the period -(1,008,188)(1,008,188)-1,881,2611,881,261
Tax on above-300,219300,219-(575,865)(575,865)
Total other comprehensive income-(707,969)(707,969)-1,305,3961,305,396
Total comprehensive income 360,557(707,969)(347,412)235,0951,305,3961,540,491
1. ‘Capital’ includes realised or unrealised gains or losses (and the tax on those) on securities in the investment portfolio, including non-equity
investments held in the investment portfolio. Income in the form of distributions and dividends is recorded as ‘Revenue’. All other items,
including expenses, are included in Profit for the year, which is categorised under ‘Revenue’.
Total comprehensive income is attributable to:
Year to 30 June 2022Year to 30 June 2021
Revenue
$’000
Capital
$’000
Total
$’000
Revenue
$’000
Capital
$’000
Total
$’000
Equity holders of Australian Foundation
Investment Company Ltd360,537(707,969)(347,432)234,6511,305,3961,540,047
Minority interests20-20444-444
360,557(707,969)(347,412)235,0951,305,3961,540,491
This Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
Consolidated Statement of Comprehensive Income
For the Year Ended 30 June 2022
36Australian Foundation Investment Company Limited Annual Report 2022

Note
2022
$’000
2021
$’000
Current assets
Cash D1144,61997,122
Receivables36,59840,011
Trading portfolio4,9794,745
Total current assets186,196141,878
Non-current assets
Investment portfolioA28,082,5138,973,080
Deferred tax assets-59
Total non-current assets8,082,5138,973,139
Total assets8,268,7099,115,017
Current liabilities
Payables28,6881,020
Borrowings – bank debt10,000-
Tax payable62,56712,621
Provisions6,1145,235
Total current liabilities107,36918,876
Non-current liabilities
Provisions896888
Deferred tax liabilities – other503-
Deferred tax liabilities – investment portfolioB21,169,4521,536,231
Total non-current liabilities1,170,8511,537,119
Total liabilities1,278,2201,555,995
Net assets6,990,4897,559,022
Shareholders’ equity
Share capitalA1, D63,070,1633,007,730
Revaluation reserveA1, D32,556,4663,394,297
Realised capital gains reserveA1, D4510,503416,071
General reserveA123,63723,637
Retained profitsA1, D5828,634716,221
Parent entity interest6,989,4037,557,956
Minority interest1,0861,066
Total equity6,990,4897,559,022
This Balance Sheet should be read in conjunction with the accompanying notes.
Consolidated Balance Sheet
As at 30 June 2022
37Australian Foundation Investment Company Limited Annual Report 2022

Year Ended 30 June 2022Note
Share
Capital
$’000
Revaluation
Reserve
$’000
Realised
Capital Gains
$’000
General
Reserve
$’000
Retained
Profits
$’000
Total
Parent Entity
$’000
Minority
Interest
$’000
Total
$’000
Total equity at the beginning of the year3,007,7303,394,297416,07123,637716,2217,557,9561,0667,559,022
Dividends paid to shareholdersA4--(35,430)-(248,124)(283,554)-(283,554)
Dividend Reinvestment PlanD662,584----62,584-62,584
Other share capital adjustments(151)----(151)-(151)
Total transactions with shareholders62,433-(35,430)-(248,124)(221,121)-(221,121)
Profit for the year----360,537360,53720360,557
Other comprehensive income (net of tax)
Net losses for the period-(707,969)
---(707,969)-(707,969)
Other comprehensive income for the year-(707,969)---(707,969)-(707,969)
Transfer to realised capital gains of cumulative gains on investments sold-(129,862)129,862-----
Total equity at the end of the year3,070,1632,556,466510,50323,637828,6346,989,4031,0866,990,489
Year Ended 30 June 2021Note
Share
Capital
$’000
Revaluation
Reserve
$’000
Realised
Capital Gains
$’000
General
Reserve
$’000
Retained
Profits
$’000
Total
Parent Entity
$’000
Minority
Interest
$’000
Total
$’000
Total equity at the beginning of the year2,947,2432,166,030397,71223,637705,2736,239,8956226,240,517
Dividends paid to shareholdersA4--(58,770)-(223,703)(282,473)-(282,473)
Dividend Reinvestment PlanD660,632----60,632-60,632
Other share capital adjustments(145)----(145)-(145)
Total transactions with shareholders60,487-(58,770)-(223,703)(221,986)-(221,986)
Profit for the year----234,651234,651444235,095
Other comprehensive income (net of tax)
Net gains for the period-1,305,396
---1,305,396-1,305,396
Other comprehensive income for the year-1,305,396---1,305,396-1,305,396
Transfer to realised capital gains of cumulative gains on investments sold-(77,129)77,129-----
Total equity at the end of the year3,007,7303,394,297416,07123,637716,2217,557,9561,0667,559,022
This Statement of Changes in Equity should be read in conjunction with the accompanying notes.
Consolidated Statement of Changes in Equity
For the Year Ended 30 June 2022
38Australian Foundation Investment Company Limited Annual Report 2022

Year Ended 30 June 2022Note
Share
Capital
$’000
Revaluation
Reserve
$’000
Realised
Capital Gains
$’000
General
Reserve
$’000
Retained
Profits
$’000
Total
Parent Entity
$’000
Minority
Interest
$’000
Total
$’000
Total equity at the beginning of the year3,007,7303,394,297416,07123,637716,2217,557,9561,0667,559,022
Dividends paid to shareholdersA4--(35,430)-(248,124)(283,554)-(283,554)
Dividend Reinvestment PlanD662,584----62,584-62,584
Other share capital adjustments(151)----(151)-(151)
Total transactions with shareholders62,433-(35,430)-(248,124)(221,121)-(221,121)
Profit for the year----360,537360,53720360,557
Other comprehensive income (net of tax)
Net losses for the period-(707,969)
---(707,969)-(707,969)
Other comprehensive income for the year-(707,969)---(707,969)-(707,969)
Transfer to realised capital gains of cumulative gains on investments sold-(129,862)129,862-----
Total equity at the end of the year3,070,1632,556,466510,50323,637828,6346,989,4031,0866,990,489
Year Ended 30 June 2021Note
Share
Capital
$’000
Revaluation
Reserve
$’000
Realised
Capital Gains
$’000
General
Reserve
$’000
Retained
Profits
$’000
Total
Parent Entity
$’000
Minority
Interest
$’000
Total
$’000
Total equity at the beginning of the year2,947,2432,166,030397,71223,637705,2736,239,8956226,240,517
Dividends paid to shareholdersA4--(58,770)-(223,703)(282,473)-(282,473)
Dividend Reinvestment PlanD660,632----60,632-60,632
Other share capital adjustments(145)----(145)-(145)
Total transactions with shareholders60,487-(58,770)-(223,703)(221,986)-(221,986)
Profit for the year----234,651234,651444235,095
Other comprehensive income (net of tax)
Net gains for the period-1,305,396
---1,305,396-1,305,396
Other comprehensive income for the year-1,305,396---1,305,396-1,305,396
Transfer to realised capital gains of cumulative gains on investments sold-(77,129)77,129-----
Total equity at the end of the year3,007,7303,394,297416,07123,637716,2217,557,9561,0667,559,022
This Statement of Changes in Equity should be read in conjunction with the accompanying notes.
39Australian Foundation Investment Company Limited Annual Report 2022

Note
2022
$’000
Inflows/
(Outflows)
2021
$’000
Inflows/
(Outflow)
Cash flows from operating activities
Sales from trading portfolio 20,88814,776
Purchases for trading portfolio (1,860)(1,297)
Interest received61116
Dividends and distributions received287,431196,351
306,520209,946
Other receipts4,9624,878
Administration expenses(18,383)(15,445)
Finance costs paid(845)(1,831)
Taxes paid(14,489)(18,781)
Net cash inflow/(outflow) from operating activitiesE1277,765178,767
Cash flows from investing activities
Sales from investment portfolio657,117469,102
Purchases for investment portfolio (662,366)(416,321)
Taxes paid on sales from investment portfolio(13,945)(23,798)
Net cash inflow/(outflow) from investing activities(19,194)28,983
Cash flows from financing activities
Net bank borrowings10,000-
Share issue transaction costs(151)(145)
Dividends paid(220,923)(221,801)
Net cash inflow/(outflow) from financing activities(211,074)(221,946)
Net increase/(decrease) in cash held47,497(14,196)
Cash at the beginning of the year97,122111,318
Cash at the end of the yearD1144,61997,122
For the purpose of the Cash Flow Statement, ‘cash’ includes cash and deposits held at call.
This Cash Flow Statement should be read in conjunction with the accompanying notes.
Consolidated Cash Flow Statement
For the Year Ended 30 June 2022
40Australian Foundation Investment Company Limited Annual Report 2022

A. Understanding AFIC’s Financial Performance
A1. How AFIC Manages its Capital
AFIC’s objective is to provide shareholders with attractive investment returns through access to a growing stream of fully franked
dividends and enhancement of capital invested.
AFIC recognises that its capital will fluctuate with market conditions. In order to manage those fluctuations, the Board may adjust
the amount of dividends paid, issue new shares, buy back the Company’s shares or sell assets.
AFIC’s capital consists of its shareholders’ equity plus any net borrowings. A summary of the balances in equity is provided below:
2022
$’000
2021
$’000
Share capital3,070,1633,007,730
Revaluation reserve2,556,4663,394,297
Realised capital gains reserve510,503416,071
General reserve23,63723,637
Retained profits828,634716,221
6,989,4037,557,956
Refer to Notes D3– D6 for a reconciliation of movement from period to period for each equity account (except the general reserve,
which is historical, relates to past profits which can be distributed and has had no movement).
A2. Investments Held and How They Are Measured
AFIC has two portfolios of securities: the investment portfolio and the trading portfolio.
The investment portfolio holds securities which the company intends to retain on a long term basis, and includes a small sub-component
over which options may be written and an additional small sub-component of international (i.e. non-Australian/New Zealand listed
stocks). The trading portfolio consist of securities that are held for short term trading only, including call option contracts written over
securities that are held in the specific sub-component of the investment portfolio and on occasion put options and is relatively small in
size. The Board has therefore focused the information in this section on the investment portfolio. Details of all holdings (except for the
specific option holdings) as at the end of the reporting period can be found at the end of the Annual Report.
The balance and composition of the investment portfolio (all at market value) was:
2022
$’000
2021
$’000
Equity instruments (excluding below) 7,492,2598,502,224
Equity instruments (over which options may be written)501,059423,249
Equity instruments (listed on non-Australian/NZ Exchanges)89,19547,607
8,082,5138,973,080
How Investments Are Shown in the Financial Statements
The accounting standards set out the following hierarchy for fair value measurement:
Level 1: Quoted prices in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices, which can be observed either directly (as prices) or indirectly (derived from prices).
Level 3: Inputs for the asset or liabilities that are not based on observable market data.
All financial instruments held by AFIC are classified as Level 1 (other than the options sold by the Company which are Level 2).
Their fair values are initially measured at the costs of acquisition and then remeasured based on quoted market prices at the end
of the reporting period.
NOTES TO THE FINANCIAL STATEMENTS
41Australian Foundation Investment Company Limited Annual Report 2022

Net Tangible Asset Backing Per Share
The Board regularly reviews the net asset backing per share both before and after provision for deferred tax on the unrealised gains in
AFIC’s long term investment portfolio. Deferred tax is calculated as set out in Note B2. The relevant amounts as at 30 June 2022 and
30 June 2021 were as follows:
30 June 2022
$
30 June 2021
$
Net tangible asset backing per share
Before tax6.637.45
After tax5.686.19
Equity Investments
The shares in the investment portfolio are designated under the accounting standards as financial assets measured at fair value
through ‘other comprehensive income’ (OCI), because they are equity instruments held for long term capital growth and dividend
income, rather than to make a profit from their sale. This means that changes in the value of these shares during the reporting period
are included in OCI in the Consolidated Statement of Comprehensive Income. The cumulative change in value of the shares over time
is then recorded in the revaluation reserve. On disposal, the amounts recorded in the revaluation reserve are transferred
to the realisation reserve.
Securities Sold and How They Are Measured
Where securities are sold from the investment portfolio, any difference between the sale price and the cost is transferred from the
revaluation reserve to the realisation reserve and the amounts noted in the Consolidated Statement of Changes in Equity. This means the
Company is able to identify the realised gains out of which it can pay a ‘Listed Investment Company’ (LIC) gain as part of the dividend,
which conveys certain taxation benefits to many of AFIC’s shareholders.
During the period $729.0 million (2021: $511.1 million) of equity securities were sold. The cumulative gain on the sale of securities was
$129.9 million for the period after tax (2021: $77.1 million). This has been transferred from the revaluation reserve to the realisation
reserve (see Consolidated Statement of Changes in Equity). These sales were accounted for at the date of trade.
A3. Operating Income
The total income received from AFIC’s investments in 2022 is set out below.
Dividends and Distributions
2022
$’000
2021
$’000
Income from securities held in investment portfolio at 30 June383,115251,687
Income from investment securities sold during the year5,1665,976
Income from securities held in trading portfolio at 30 June211211
Income from trading securities sold during the year--
388,492257,874
Interest income
Revenue from deposits and cash management trusts61116
Other revenue
Administration fees4,8714,831
Other income --
4,8714,831
Dividend Income
Distributions from listed securities are recognised as income when those securities are quoted in the market on an ex-distribution basis.
Capital returns on ordinary shares are treated as an adjustment to the carrying value of the shares.
Notes to the Financial Statements
continued
42Australian Foundation Investment Company Limited Annual Report 2022

Trading Income
Net gains on the trading and options portfolio are set out below.
Net Gains
2022
$’000
2021
$’000
Net realised gains/(losses) from trading portfolio – shares224149
– options1,0081,724
Unrealised gains/(losses) from trading portfolio – shares(641)897
– options38(298)
6292,472
$131.6 million of shares are lodged with the ASX Clear Pty Ltd as collateral for sold option positions written by the Group (2021:
$152.3 million). These shares are lodged with ASX Clear under the terms of ASX Clear Pty Ltd which require participants in the
exchange traded option market to lodge collateral, and are recorded as part of the Group’s investment portfolio. If all call options
were exercised, this would lead to the sale of $21.4 million worth of securities at an agreed price – the ‘exposure’ (2021: $44.5 million).
There were no put options in the portfolio at 30 June 2022 (2021: $nil).
A4. Dividends Paid
The dividends paid and payable for the year ended 30 June 2022 are shown below:
2022
$’000
2021
$’000
(a) Dividends Paid During the Year
Final dividend for the year ended 30 June 2021 of 14 cents fully franked at 30 per cent paid
31 August 2021 (2021: 14 cents fully franked at 30 per cent paid on 1 September 2020)165,339164,556
Interim dividend for the year ended 30 June 2022 of 10 cents per share fully franked at 30 per cent
paid 25 February 2022 (2021: 10 cents fully franked at 30 per cent paid 23 February 2021)118,215117,917
283,554282,473
Dividends paid in cash220,970221,841
Dividends reinvested in shares62,58460,632
283,554282,473
Dividends forgone via DSSP9,7678,635
(b) Franking Credits
Opening balance of franking account at 1 July158,009174,053
Franking credits on dividends received138,15867,295
Tax paid during the year27,56141,428
Franking credits paid on ordinary dividends paid(121,523)(121,060)
Franking credits deducted on DSSP shares issued(4,272)(3,707)
Closing balance of franking account197,933158,009
Adjustments for tax payable in respect of the current year’s profits and the receipt
of dividends recognised as receivables69,96719,610
Adjusted closing balance267,900177,619
Impact on the franking account of dividends declared but not recognised as a liability
at the end of the financial year:(73,794)(73,250)
Net available194,106104,369
These franking account balances would allow AFIC to frank additional dividend
payments up to an amount of:452,914243,528
AFIC’s ability to continue to pay franked dividends is dependent upon the receipt of franked dividends from the trading and investment
portfolios and on AFIC paying tax.
43Australian Foundation Investment Company Limited Annual Report 2022

Notes to the Financial Statements
continued
2022
$’000
2021
$’000
(c) New Zealand Imputation Account
(Figures in A$ at year-end exchange rate: 2022: $NZ1.073:$A1; 2021: $NZ1.074:$A1)
Opening balance13,2618,470
Imputation credits on dividends received5,8484,779
Imputation credits on dividends paid--
Closing balance19,10913,249
There will be NZ imputation credit on NZ 3.5 cents of the final dividend attached to the
proposed dividend payable on 30 August 2022. This will utilise, on the above exchange rates,
$15.6 million of the above balance.
(d) Dividends Declared After Balance Date
Since the end of the year Directors have declared a final dividend of 14 cents per share fully
franked at 30 per cent. The aggregate amount of the final dividend for the year to 30 June 2022
to be paid on 30 August 2022, but not recognised as a liability at the end of the financial year is:172,187
(e) Listed Investment Company Capital Gain Account
Balance of the Listed Investment Company (LIC) capital gain account at 1 July:43,79362,912
Capital gains (including LIC gains received from dividends)150,25639,651
LIC gains paid as part of dividend(35,430)(58,770)
Balance at 30 June158,61943,793
This equates to an attributable gain of:226,599 62,562
Distributed LIC capital gains may entitle certain shareholders to a deduction in their tax return, as set out in the dividend statement.
LIC capital gains available for distribution are dependent on the disposal of investment portfolio holdings that qualify for LIC capital
gains, or the receipt of LIC distributions from LIC securities held in the portfolios. $175.7 million attributable gain is attached to the
final dividend to be paid on 30 August 2022.
A5. Earnings Per Share
The table below shows the earnings per share based on the profit for the year:
Basic Earnings Per Share
2022
Number
2021
Number
Weighted average number of ordinary shares used as the denominator1,226,476,0151,217,056,577
$’000$’000
Profit for the year 360,537234,651
Cents Cents
Basic earnings per share29.4019.28
Excluding the Woodside/BHP Petroleum merger dividend for the year ended 30 June 2022, and the Endeavour demerger dividend for
the previous corresponding period, the basic earnings per share figure would be 23.3 cents (2021: 16.3 cents).
44Australian Foundation Investment Company Limited Annual Report 2022

B. Costs, Tax and Risk
B1. Management Costs
The total management expenses for the period are as follows:
2022
$’000
2021
$’000
Rental expense relating to non-cancellable leases (760)(747)
Employee benefit expenses (12,819)(9,304)
Depreciation charge--
Other administration expenses(5,586)(5,458)
(19,165)(15,509)
Employee Benefit Expenses
A major component of employee benefit expenses is Directors’ and Executives’ remuneration. This has been summarised below:
Short Term
Benefits
$
Other Long
Term Benefits
$
Post-
employment
Benefits
$
Share-based
Payments
$
Total
$
2022
Non-Executive Directors 843,182-56,818-900,000
Executives3,208,522-110,000531,2753,849,797
Total4,051,704-166,818531,2754,749,797
2021
Non-Executive Directors749,363-54,867-804,230
Executives3,191,746(120,224)99,524526,8343,697,880
Total3,941,109(120,224)154,391526,8344,502,110
Detailed remuneration disclosures are provided in the Remuneration Report.
The Group (i.e. AFIC and its subsidiary, Australian Investment Company Services Ltd (AICS) – see Note F8) does not make loans
to Directors or Executives.
B2. Tax
AFIC’s tax position, and how it accounts for tax, is explained here. Detailed reconciliations of tax accounting to the financial statements
can be found in Note E2.
The income tax expense for the period is the tax payable on this financial year’s taxable income, adjusted for any changes in deferred
tax assets and liabilities attributable to temporary differences and for any unused tax losses. Deferred tax assets and liabilities (except
for those related to the unrealised gains or losses in the investment portfolio) are offset, as all current and deferred taxes relate to the
Australian Taxation Office and can legally be settled on a net basis.
A provision has been made for taxes on any unrealised gains or losses on securities valued at fair value through the Income Statement
– i.e. the trading portfolio, puttable instruments and convertible notes that are classified as debt.
A provision also has to be made for any taxes that could arise on sale of securities in the investment portfolio, even though there is no
intention to dispose of them. Where AFIC disposes of such securities, tax is calculated according to the particular parcels allocated to
the sale for tax purposes, offset against any capital losses carried forward.
45Australian Foundation Investment Company Limited Annual Report 2022

Notes to the Financial Statements
continued
Tax Expense
The income tax expense for the period is shown below:
(a) Reconciliation of Income Tax Expense to Prima Facie Tax Payable
2022
$’000
2021
$’000
Profit before income tax expense 374,073247,953
Tax at the Australian tax rate of 30 per cent (2021: 30 per cent)112,22274,386
Tax offset for franked dividends received(96,709)(47,106)
Demerger dividend non-taxable-(10,952)
Sundry items whose tax treatment differs from accounting treatment(403)(1,234)
15,11015,094
Over provision in prior years(1,624)(2,236)
Total tax expense13,48612,858
Deferred Tax Liabilities – Investment Portfolio
The accounting standards require us to recognise a deferred tax liability for the potential capital gains tax on the unrealised gain in the
investment portfolio. This amount is shown in the Balance Sheet. However, the Board does not intend to sell the investment portfolio,
so this tax liability is unlikely to arise at this amount. Any sale of securities would also be affected by any changes in capital gains tax
legislation or tax rate applicable to such gains when they are sold.
2022
$’000
2021
$’000
Deferred tax liabilities on unrealised gains in the investment portfolio1,169,4521,536,231
Opening balance at 1 July1,536,231973,499
Tax on realised gains(66,560)(13,133)
Charged to OCI for ordinary securities on gains or losses for the period(300,219)575,865
1,169,4521,536,231
B3. Risk
Market Risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices.
As a Listed Investment Company that invests in tradeable securities, AFIC can never be free of market risk as it invests its capital in
securities which are not risk free – the market price of these securities will fluctuate.
A general fall in market prices of 5 per cent and 10 per cent, if spread equally over all assets in the investment portfolio, would have
led to a reduction in AFIC’s comprehensive income of $282.9 million and $565.8 million respectively, at a tax rate of 30 per cent
(2021: $314.1 million and $628.1 million).
AFIC seeks to reduce market risk at the investment portfolio level by ensuring that it is not, in the opinion of the Investment Committee,
overly exposed to one company or one particular sector of the market. The relative weightings of the individual securities and the
relevant market sectors are reviewed by the Investment Committee and risk can be managed by reducing exposure where necessary.
AFIC does not have a minimum or maximum amount of the portfolio that can be invested in a single company or sector.
46Australian Foundation Investment Company Limited Annual Report 2022

AFIC’s total investment exposure by sector is as below:
2022
%
2021
%
Energy3.261.96
Materials14.2914.32
Industrials12.6814.40
Consumer Discretionary7.077.83
Consumer Staples 5.194.42
Banks 18.3618.97
Other Financials9.148.88
Real Estate2.972.47
Telecommunications5.875.99
Healthcare14.7714.40
Information Technology4.614.63
Utilities0.030.66
Cash1.761.07
Securities representing over 5 per cent of the investment portfolio at 30 June were
Commonwealth Bank8.88.8
CSL7.96.9
BHP7.17.3
Transurban5.13.8
AFIC is also not directly exposed to material currency risk as most of its investments are quoted in Australian dollars. The international
portfolio is a minor (1.1 per cent) part of the total portfolio (2021: 0.5 per cent).
The writing of call options provides some protection against a fall in market prices as it generates income to partially compensate
for a fall in capital values. Options are only written against securities that are held in the trading or the specific sub-section of the
investment portfolio.
Interest Rate Risk
The Group is not currently materially exposed to interest rate risk as all its cash investments and borrowings are short term for
a fixed interest rate.
Credit Risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an
obligation. AFIC is exposed to credit risk from cash, receivables, securities in the trading portfolio and securities in the investment
portfolio respectively. None of these assets are overdue. The risk in relation to each of these items is set out below.
Cash
All cash investments not held in a transactional account (including with a custodian) are invested in short term deposits with Australia’s
‘big four’ commercial banks or in cash management trusts which invest predominantly in short term securities with an A1+ rating.
In the unlikely event of a bank default or default on the underlying securities in the cash trust, there is a risk of losing the cash deposits
and any accrued unpaid interest.
Receivables
Outstanding settlements are on the terms operating in the securities industry, which usually require settlement within two days of the
date of a transaction. Receivables are non-interest bearing and unsecured. In the event of a payment default, there is a risk of losing
any difference between the price of the securities sold and the price of the recovered securities from the discontinued sale. Receivables
also include dividends from securities that have passed the record date for the distribution but have not paid as at balance date.

Trading and Investment Portfolios
Converting and convertible notes or other interest-bearing securities that are not equity securities carry credit risk to the extent of
their carrying value. This risk will be realised in the event of a shortfall on winding-up of the issuing companies. As at 30 June 2022,
no such investments are held (2021: nil). AFIC engages a custodian, Northern Trust, to hold the shares that are in the sub-component
of the investment portfolio that contains international shares. AFIC receives a GS007 report on Internal Controls for Custody, Investment
Administration, Registry Monitoring and Related Information Technology Services from Northern Trust every six months.
47Australian Foundation Investment Company Limited Annual Report 2022

Notes to the Financial Statements
continued
Liquidity Risk
Liquidity risk is the risk that an entity will not be able to meet its financial liabilities.
AFIC monitors its cash flow requirements daily. The Investment Committee also monitors the level of contingent payments on a regular
basis by reference to known sales and purchases of securities, dividends and distributions to be paid or received, put options that may
require AFIC to purchase securities, and facilities that need to be repaid. AFIC ensures that it has either cash or access to short term
borrowing facilities sufficient to meet these contingent payments.
AFIC’s inward cash flows depend upon the dividends received. Should these drop by a material amount, AFIC would amend its
outward cash flows accordingly. AFIC’s major cash outflows are the purchase of securities and dividends paid to shareholders, and
both of these can be adjusted by the Board and management. Furthermore, the assets of AFIC are largely in the form of readily
tradeable securities which can be sold on-market if necessary.
The table below analyses AFIC’s financial liabilities into relevant maturity groupings. The amounts disclosed in the table are the
contractual undiscounted cash flows. Balances due within 12 months equal their carrying amounts as the impact of discounting
is not significant.
30 June 2022
Less Than
6 Months
$’000
6–12 Months
$’000
Greater
Than 1 Year
$’000
Total
Contractual
Cash Flows
$’000
Carrying
Amount
$’000
Non-derivatives
Payables28,688--28,68828,688
Borrowings10,000--10,00010,000
38,688--38,68838,688
Derivatives
Options in trading portfolio*-----
-----
30 June 2021
Less Than
6 Months
$’000
6 –12 Months
$’000
Greater
Than 1 Year
$’000
Total
Contractual
Cash Flows
$’000
Carrying
Amount
$’000
Non-derivatives
Payables1,020--1,0201,020
1,020--1,0201,020
Derivatives
Options in trading portfolio*-----
-----
* In the case of call options, there are no contractual cash flows as if the option is exercised the contract will be settled in the securities over which the
option is written. The contractual cash flows for put options written are the cash sums the Company will pay to acquire securities over which the options
have been written, and it is assumed for the purpose of the above disclosure that all options will be exercised (i.e. maximum cash outflow). There were
no put options outstanding at 30th June 2022.
C. Unrecognised Items
C1. Contingencies
Directors are not aware of any material contingent liabilities or contingent assets other than those already disclosed elsewhere
in the Financial Report.
48Australian Foundation Investment Company Limited Annual Report 2022

Further information that shareholder may find useful is included here. It is grouped into three sections:
D. Balance Sheet Reconciliations
E. Income Statement Reconciliations
F. Further Information
D. Balance Sheet Reconciliations
These notes provide further information about the basis of calculation of line items in the financial statements.
D1. Current Assets – Cash
2022
$’000
2021
$’000
Cash at bank and in hand (including on-call)144,61997,122
144,61997,122
Cash holdings yielded an average floating interest rate of 0.08 per cent (2021: 0.14 per cent). All cash investments are held in
a transactional account, with a custodian or in an over-night ‘at call’ account invested in cash management trusts which invest
predominantly in short term securities with an A1+ rating.
D2. Credit Facilities
2022
$’000
2021
$’000
Commonwealth Bank of Australia – cash advance facility 110,00050,000
Amount drawn down at 30 June00
Undrawn facilities at 30 June110,00050,000
National Australia Bank – cash advance facility 20,0000
Amount drawn down at 30 June10,0000
Undrawn facilities at 30 June10,0000
Total short term loan facilities130,00050,000
Total drawn down at 30 June10,0000
Total undrawn facilities at 30 June120,00050,000
The above borrowings, with the exception of the NAB facility, are unsecured. Repayment of facilities is done either through the use of
cash received from distributions or the sale of securities, or by rolling existing facilities into new ones. Facilities are usually drawn down
for no more than three months and hence are classified as current liabilities when drawn.
The debt facility with National Australia Bank is structured in the form of a securities lending arrangement. The terms of the agreement
require that securities be pledged as collateral for the drawn secured borrowings under that facility and that such securities currently
satisfy a minimum value of $11 million (110 per cent of the total drawn facility). These securities are held by the National Australia Bank
but included as part of the Company’s investment portfolio. As at 30 June 2022 the market value of the securities pledged as collateral
was $12.2 million (2021: n/a).
D3. Revaluation Reserve
2022
$’000
2021
$’000
Opening balance at 1 July3,394,2972,166,030
Gains/(losses) on investment portfolio
– Equity instruments(1,008,188)1,881,261
Provision for tax on above300,219(575,865)
Cumulative taxable realised (gains)/losses (net of tax)(129,862)(77,129)
2,556,4663,394,297
This reserve is used to record increments and decrements on the revaluation of the investment portfolio as described in accounting
policy Note A2.
49Australian Foundation Investment Company Limited Annual Report 2022

Notes to the Financial Statements
continued
D4. Realised Capital Gains Reserve
2022
$’000
2021
$’000
Opening balance at 1 July416,071397,712
Dividends paid(35,430)(58,770)
Cumulative taxable realised gains/(losses) (net of tax)129,86277,129
510,503416,071
This reserve records gains or losses after applicable taxation arising from disposal of securities in the investment portfolio as
described in Note A2.
D5. Retained Profits
2022
$’000
2021
$’000
Opening balance at 1 July716,221705,273
Dividends paid(248,124)(223,703)
Profit for the year360,537234,651
828,634716,221
This reserve relates to past profits.
D6. Share Capital
Movements in Share Capital
DateDetailsNote
Number
of Shares
’000
Issue Price
$
Paid-up
Capital
$’000
1/07/2020Balance1,210,3642,947,243
01/09/2020Dividend Reinvestment Plani5,5836.3035,165
01/09/2020Dividend Substitution Share Planii7766.30n/a
23/02/2021Dividend Reinvestment Plani3,5877.1025,467
23/02/2021Dividend Substitution Share Planii5277.10n/a
VariousCosts of issue--(145)
30/06/2021Balance1,220,8373,007,730
31/08/2021Dividend Reinvestment Plani4,5078.1036,511
31/08/2021Dividend Substitution Share Planii6878.10n/a
25/02/2022Dividend Reinvestment Plani3,3177.8626,073
25/02/2022Dividend Substitution Share Planii5587.86n/a
VariousCosts of issue--(151)
30/06/2022Balance1,229,9063,070,163
i. Shareholders elect to have all or part of their dividend payment reinvested in new ordinary shares under the Dividend Reinvestment Plan (DRP).
The price of the new DRP shares is based on the average selling price of shares traded on the Australian Securities Exchange and Cboe in the
five days after the shares begin trading on an ex-dividend basis.
ii. The Group has a Dividend Substitution Share Plan (DSSP) whereby shareholders may elect to forgo a dividend and receive shares instead.
Pricing for the DSSP shares is done as per the DRP shares.
iii. The Group has an on-market share buy-back program. During the financial year, no shares were bought back (2021: nil).
All shares have been fully paid, rank pari passu and have no par value.
50Australian Foundation Investment Company Limited Annual Report 2022

E. Income Statement Reconciliations
E1. Reconciliation of Net Cash Flows From Operating Activities to Profit
2022
$’000
2021
$’000
Profit for the year360,557235,095
Net decrease/(increase) in trading portfolio(234)(441)
Dividends received as securities under DRP investments(74,888)-
Demerger dividend – non-cash item-(36,505)
Decrease/(increase) in current receivables3,413(22,664)
– Less increase/(decrease) in receivables for investment portfolio(9,875)9,875
Increase/(decrease) in deferred tax liabilities(366,217)563,545
– Less (increase)/decrease in deferred tax liability on investment portfolio366,779(562,732)
Increase/(decrease) in current payables27,668136
– Less increase/(decrease) in dividends payable(46)(40)
– Less (increase) in payables for investment portfolio(27,610)-
Increase/(decrease) in provision for tax payable49,946(18,150)
Capital gains tax charge taken through equity(66,560)(13,133)
Prior year taxes paid relating to capital gains13,94523,798
Increase/(decrease) in other provisions/non-cash items 887(17)
Net cash flows from operating activities277,765178,767
E2. Tax Reconciliations
Tax Expense Composition
2022
$’000
2021
$’000
Charge for tax payable relating to the current year14,54814,281
Over provision in prior years(1,624)(2,236)
(Increase)/Decrease in deferred tax assets562813
13,48612,858
Amounts Recognised Directly Through Other Comprehensive Income
Net movement in deferred tax liabilities relating to capital gains tax on the movement
in gains/losses in the investment portfolio(300,219)575,865
(300,219)575,865
Deferred Tax Assets and Liabilities
The deferred tax balances are attributable to:
2022
$’000
2021
$’000
(a) Tax on unrealised gains or losses in the trading portfolio(161)(253)
(b) Provisions and expenses charged to the accounting profit which are not yet tax deductible2,1111,851
(c) Interest and dividend income receivable which is not assessable for tax until receipt(2,453)(1,539)
(503)59
Movements:
Opening balance at 1 July59872
Credited/(charged) to Income Statement(562)(813)
(503)59
Deferred tax assets and liabilities arise when provisions and expenses have been charged but are not yet tax deductible. These assets
are realised when the relevant items become tax deductible, as long as enough taxable income has been generated to claim the assets
against, and as long as there are no changes to the tax legislation that affect AFIC’s ability to claim the deduction.
51Australian Foundation Investment Company Limited Annual Report 2022

Notes to the Financial Statements
continued
F. Further Information
This section covers information that is not directly related to specific line items in the financial statements, including information about
related party transactions, share-based payments, assets pledged as security and other statutory information.
F1. Related Parties
All transactions with deemed related parties were made on normal commercial terms and conditions and approved by independent
Directors.
(a) Arrangements With Non-Executive Directors
Non-Executive Directors J Paterson, C Drummond and C Walter have rented office space and, for J Paterson, a parking space from
the Group at commercial rates during the year. Sub-lease rental income (included in revenue) received or receivable by the Group,
excluding GST, during the year was $51,824 (2021: $62,608).
(b) AICS Transactions With Minority Interests
The below transactions were with Djerriwarrh Investments Ltd as a minority interest holder in the Company’s subsidiary.
2022
$’000
2021
$’000
Administration expenses charged for the year2,2622,528
(c) AICS Transactions With Other Listed Investment Companies
AICS had the following transactions with other Listed Investment Companies to which it provides services:
2022
$’000
2021
$’000
Administration expenses charged for the year to Mirrabooka Investments Ltd1,7021,467
Administration expenses charged for the year to AMCIL Ltd1,021916
F2. Remuneration of Auditors
For the year the auditor earned or will earn the following remuneration:
2022
$
2021
$
PricewaterhouseCoopers
Audit services
Audit or review of financial reports 214,834210,050
Audit-related services
AFSL compliance audit and review8,7078,331
Non-audit services
Preparation and lodgement of tax returns34,37032,940
Assistance with ATO Combined Assurance Review41,800-
Total remuneration299,711251,321
52Australian Foundation Investment Company Limited Annual Report 2022

F3. Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting used by the chief operating decision-maker.
The Board, through its Committees, has been identified as the chief operating decision-maker, as it is responsible for allocating
resources and assessing performance of the operating segments.
Description of Segments
The Board makes the strategic resource allocations for AFIC. AFIC has therefore determined the operating segments based on
the reports reviewed by the Board, which are used to make strategic decisions.
The Board is responsible for AFIC’s entire portfolio of investments and considers the business to have a single operating segment
(noting that the investment portfolio contains sub-components for ease of administration). The Board’s asset allocation decisions
are based on a single, integrated investment strategy, and AFIC’s performance is evaluated on an overall basis.
Segment Information Provided to the Board
The internal reporting provided to the Board for AFIC’s assets, liabilities and performance is prepared on a consistent basis with the
measurement and recognition principles of Australian Accounting Standards, except that net assets are reviewed both before and after
the effects of capital gains tax on investments (as reported in AFIC’s Net Tangible Asset announcements to the ASX).
Other Segment Information
Revenues from external parties are derived from the receipt of dividend, distribution and interest income, and income arising on the
trading portfolio and realised income from the options portfolio.
AFIC is domiciled in Australia and most of AFIC’s income is derived from Australian entities or entities that maintain a listing in Australia.
AFIC has a diversified portfolio of investments, with only one investment comprising more than 10 per cent of AFIC’s income –
BHP (35.6 per cent including the Woodside/BHP Petroleum merger dividend)(2021 two investments: Woolworths (16.1 per cent
as a consequence of the Endeavour Group demerger) and BHP (11.0 per cent)).
F4. Summary of Other Accounting Policies
This general purpose Financial Report has been prepared in accordance with Australian Accounting Standards, Interpretations issued
by the Australian Accounting Standards Board and the Corporations Act 2001. This Financial Report has been authorised for issue on
25 July 2022 in accordance with a resolution of the Board and is presented in the Australian currency. The Directors of the Company
have the power to amend and reissue the Financial Report.
AFIC has attempted to improve the transparency of its reporting by adopting ‘plain English’ where possible. Key ‘plain English’ phrases
and their equivalent AASB terminology are as follows:
PhraseAASB Terminology
Market valueFair value for actively traded securities
CashCash and cash equivalents
Share capitalContributed equity
OptionsDerivatives written over equity instruments that are valued at fair value through profit or loss
HybridsEquity instruments that have some of the characteristics of debt
AFIC complies with International Financial Reporting Standards (IFRS). AFIC is a ‘for profit’ entity.
AFIC has not applied any Australian Accounting Standards or AASB Interpretations that have been issued as at balance date but are
not yet operative for the year ended 30 June 2022 (‘the inoperative standards’). The impact of the inoperative standards has been
assessed and the impact has been identified as not being material. AFIC only intends to adopt other inoperative standards at the date
at which their adoption becomes mandatory.
Basis of Accounting
The financial statements are prepared using the valuation methods described in Note A2. All other items have been treated in
accordance with the historical cost convention.
Fair Value of Financial Assets and Liabilities
The fair value of cash and non-interest bearing monetary financial assets and liabilities of AFIC approximates their carrying value.
53Australian Foundation Investment Company Limited Annual Report 2022

Notes to the Financial Statements
continued
Convertible Notes
On the issue of convertible notes, the Group estimates the fair value of the liability component of the convertible notes, being the
obligation to make future payments of principal and interest to holders, using a market interest rate for a non-convertible note of similar
terms and conditions. The residual amount is included in equity as other equity securities with no recognition of any change in the value
of the option in subsequent periods. The liability component is then included in borrowings. Expenses incurred in connection with the
issue of the notes are deducted from the total face value and the expense is then incurred over the life of the notes.
The total liability is subsequently carried on an amortised cost basis with interest on the notes recognised as finance costs on an
effective yield basis until the liability is extinguished on conversion or maturity of the notes.
Employee Benefits
(i) Wages, Salaries and Annual Leave
Liabilities for wages and salaries, including annual leave, expected to be settled within 12 months of balance date are recognised as
current provisions in respect of employees’ services up to balance date and are measured at the amounts expected to be paid when
the liabilities are settled.
(ii) Long Service Leave
In calculating the value of long service leave, consideration is given to expected future wage and salary levels, experience of employee
departures and periods of service. Expected future payments are discounted using market yields at balance date on national
government bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.
(iii) Cash Incentives
Cash incentives are provided under the Executive Annual Incentive Plan and are dependent upon the performance of the Group.
A provision is made for the cost of unsettled cash incentives at balance date. The Investment Team Annual Incentive Plans are also
settled on a cash basis.
(iv) Share Incentives
Share incentives are provided under the Executive Annual Incentive Plan, Executive Long Term Incentive Plan and the Employee Share
Acquisition Scheme.
For the Employee Share Acquisition Scheme and the Executive Annual Incentive Plan, the incentives are based on the performance
of the individual, the Group and investment companies to which the group provides administration services, for the financial year.
For the Employee Share Acquisition Scheme and a portion of the Executive Annual Incentive, the recipient agrees to purchase
(or have purchased for them) shares on-market, but receives a cash amount. A provision for the amount payable under the
Annual Incentive Plans is recognised on the Balance Sheet.
For the Investment Team Long Term Incentive Plan, the incentives are based on the performance of the Group and investment
companies to which the group provides administration services over a four-year period. The incentives may be settled in shares
(but based on a cash amount) or cash. Historically, all awards have been cash. Expenses are recognised over the four-year assessment
period based on the amount expected to be payable under this plan, resulting in a provision for incentive payable being built up on the
Balance Sheet over the assessment period.
Under the Executive Long Term Incentive Plan which was introduced for the year ended 30 June 2013, the amount awarded is
represented by performance shares. The 30-day Volume Weighted Average Price (VWAP) of AFIC shares up to but not including 1 July
is calculated. The amount of ELTIP available is then divided by this 30-day VWAP price to determine the number of performance shares
that may vest at the vesting point in four years’ time. The value of each performance shares will be adjusted by the accumulation return
on the AFI share price (being the movement in the share price assuming the reinvestment of any dividends) up to vesting date, based
on a final share price calculated on the 30-day VWAP price up to 30 June. 45,680 shares vested during the year ended 30 June 2022.
The expense will be charged directly through the Income Statement in the following manner – 25 per cent of the total estimated cost
in Year 1, 50 per cent of the total estimated cost in Year 2 less the expense charged in Year 1, 75 per cent of the total estimated cost
in Year 3 less the expense charged in Years 1 and 2 and 100 per cent of the total estimated cost in Year 4 less the expense charged
in Years 1, 2 and 3.
Directors’ Retirement Allowances
The Group recognises as ‘amounts payable’ Directors’ retirement allowances that have been crystallised. No further amounts will be
expensed as retirement allowances.
54Australian Foundation Investment Company Limited Annual Report 2022

Administration Fees
The Group currently provides administrative services to other Listed Investment Companies. The associated fees are recognised on
an accruals basis as income throughout the year. Any amounts outstanding at balance date are recognised as receivable, subject to
the assessment of recoverability by the Directors.
Operating Leases
The Group currently has an operating lease in respect of its premises. Payments made under operating leases are charged to the
Income Statement on a straight-line basis over the period of the lease.
Rounding of Amounts
AFIC is a company of the kind referred to in the ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191,
relating to the ‘rounding off’ of amounts in the Financial Report. Amounts in the Financial Report have been rounded off in accordance
with that Instrument, to the nearest thousand dollars, or in certain cases, to the nearest dollar.
F5. Performance Bond
The Group’s subsidiary, AICS, has under the terms of its Australian Financial Services License in place a performance bond to the sum
of $20,000 underwritten by the Commonwealth Bank of Australia in favour of the Australian Securities and Investments Commission
(ASIC), payable on demand to ASIC.
F6. Share-based Payments
Share-based Payments
The Group has a number of share incentive arrangements. These are accounted for in accordance with Note F4. Where shares are
issued to employees of AICS, AICS compensates AFIC for the fair value of the shares.
(a) Executive Incentive Plans
The executives’ remuneration arrangements incorporate an ‘at risk’ component as set out in the remuneration report. Part of this ‘at risk’
component is paid in shares in the Group.
(i) Executive Annual Incentive Plan
Each financial year, the Remuneration Committee sets the target (cash) amount of remuneration that could be paid should all
performance targets and measures be achieved. If all are achieved, 100 per cent of the remuneration will be awarded. If stretch levels
of performance are achieved above target, then higher amounts may be paid. On the other hand there is no set minimum that will be
paid regardless of performance.
The performance measures are a combination of the performance of the Group, the investment companies to which the Group
provides administration services, and personal objectives.
All of the incentive remuneration awarded is paid in cash, with 25 per cent of the pre-tax amount being used by the Executive to purchase
shares in AFIC and/or the other LICs. All remuneration under the plan, is paid in the financial year following the year of assessment.
The executive agrees to the shares being subject to being held for four years (holding term), during which they cannot be sold.
Dividends are paid to executives on these shares prior to the expiry of the holding term. Should an Executive leave the Group before
the holding term expires, the restriction will be lifted.
27,429 shares for both LTIP and Annual Incentive (2021: 21,736 shares) were purchased by Executives in the year (in relation
to the prior year) with a fair value (being the acquisition price) of $220,476 (2021: $149,306).
(ii) Executive Long Term Incentive Plan
Under the Executive Long Term Incentive Plan, the amount awarded will be represented by performance rights. The 30-day Volume
Weighted Average Price (VWAP) of AFIC shares up to but not including 1 July will be calculated. The amount of ELTIP available will then
be divided by this 30-day VWAP price to determine the number of performance rights that may vest at the vesting point in four years’
time. The value of each performance right will be adjusted by the accumulation return on the AFI share price (being the movement in
the share price assuming the reinvestment of any dividends) up to vesting date, based on a final share price calculated on the 30-day
VWAP price up to 30 June.
55Australian Foundation Investment Company Limited Annual Report 2022

Notes to the Financial Statements
continued
The estimated fair value of the award will be calculated in accordance with AASB 2 – Share Based Payments at the end of each year
until the final year of vesting. The liability shown after the final year of vesting will represent the actual amount being paid to eligible
employees as a cash-settled share-based payment.
54,569 rights were awarded under the plan during the year ended 30 June 2022 (2021: 67,777). An expense of $537,943 (2021: $826,722)
was incurred for the 2018/19, 2019/20, 2020/21 and 2021/22 plans. 8,212 rights under the 2017/18 plan were forfeited during the year
(12.1 per cent).
Note that it is currently proposed that the Executive Long Term Incentive Plan be incorporated within the existing Annual Incentive Plan.
(b) Employee Share Acquisition Scheme
Under the current Employee Share Acquisition Scheme, each employee who is not a participant in the Executive or Investment Team
Incentive Plans is awarded $5,000 per annum. After PAYG is deducted, $2,500 is used to buy shares in the Company, which needs to
be held for three years. After three years, or the departure of the employee from employment with the Group, the shares come out of
the holding lock.
In addition, each employee is eligible for an additional award of up to $5,000. 50 per cent of the amount awarded is used to buy shares
in one of the other LICs that AICS provides services to. The amount that is awarded is dependent on the metrics used for the vesting of
the Investment Team’s Short Term Incentive (excluding personal measures). During the year, 92 per cent of the possible maximum was
awarded, and 50 per cent of this was used to buy shares in Djerriwarrh Investments Limited, as part of the Group’s policy of rotating
these purchases amongst the LICs other than AFIC to which AICS provides services.
(c) Expenses Arising From Share Based Payment Transactions
Total expenses arising from share based payment transactions recognised during the period as part of the employee benefit expense
(excluding any reversals and the Investment Team Long Term Incentive Plan) were as follows:
2022
$’000
2021
$’000
Share-based payment expense599879
(d) Liability
The total liability arising from share-based payment transactions is included in the current and non-current liabilities for ‘provisions’.
F7. Principles of Consolidation
AFIC’s consolidated financial statements consist of the financial statements of AFIC, the parent, and its subsidiary, Australian
Investment Company Services Ltd (AICS). 25 per cent of AICS is owned by Djerriwarrh Investments Ltd, another investment
company for which AICS performs operational and investment administration services, and for which it is paid monthly.
No subsidiaries were acquired or disposed of during the year. Intercompany transactions and balances between AFIC and AICS
are eliminated on consolidation.
The financial information for the parent entity, disclosed in Note F10 below, has been prepared on the same basis as the consolidated
financial statements. All notes are for the consolidated group unless specifically noted otherwise.
F8. Subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries:
Country of
Incorporation
Equity Holding
Name of EntityClass of Shares20222021
Australian Investment Company Services LtdAustralia Ordinary75%75%
The investment in AICS is accounted for at cost in the individual financial statements of AFIC.
56Australian Foundation Investment Company Limited Annual Report 2022

F9. Lease Commitments
The Group has entered into a non-cancellable operating lease for the use of its premises for six years with effect from 1 July 2022
(prior year comparatives represent the former lease). Current commitments relating to leases at balance date, for the current lease
(including GST), is:
2022
$’000
2021
$’000
Due within one year508667
Later than one year but less than five2,302-
Greater than five years648-
3,458667
The lease will be accounted for under the provisions of AASB 16 Leases when it commences.
F10. Parent Entity Financial Information
Summary Financial Information
The individual financial statements for the parent entity show the following aggregate amounts:
2022
$’000
2021
$’000
Balance Sheet
Current assets177,347133,183
Total assets8,257,7059,106,106
Current liabilities101,68813,271
Total liabilities1,271,4021,551,348
Shareholders’ equity
Issued capital3,070,3133,007,730
Reserves
Revaluation reserve2,556,4663,394,297
Realised capital gains reserve510,503416,071
General reserve23,63723,637
Retained earnings825,384713,023
3,915,9904,547,028
Total shareholders’ equity6,986,3037,554,758
Profit or loss for the year360,477233,319
Total comprehensive income (347,472)1,538,715
57Australian Foundation Investment Company Limited Annual Report 2022

DIRECTORS’ DECLARATION
In the Directors’ opinion:
(1) the financial statements and notes set out on pages 34 to 57 are in accordance with the Corporations Act 2001 including:
(a) complying with the Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting
requirements; and
(b) giving a true and fair view of the entity’s financial position as at 30 June 2022 and of its performance for the financial year ended
on that date; and
(2) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.
Note F4 to the financial statements confirms that the financial statements also comply with International Financial Reporting Standards
as issued by the International Accounting Standards Board.
This declaration is made in accordance with a resolution of the Directors.
This declaration has been made after receiving the declarations required to be made to the Directors by the Managing Director and the
Chief Financial Officer regarding the financial statements in accordance with Section 295A of the Corporations Act 2001 for the financial
year ended 30 June 2022. The declarations received were that, in the opinion of the Managing Director and the Chief Financial Officer
to the best of their knowledge, the financial records of the Company have been properly maintained, that the financial statements
comply with Accounting Standards and that they give a true and fair view.
John Paterson
Chairman
Melbourne
25 July 2022
58Australian Foundation Investment Company Limited Annual Report 2022

INDEPENDENT AUDIT REPORT
59Australian Foundation Investment Company Limited Annual Report 2022

INDEPENDENT AUDIT REPORT
continued
60Australian Foundation Investment Company Limited Annual Report 2022

61Australian Foundation Investment Company Limited Annual Report 2022

INDEPENDENT AUDIT REPORT
continued
62Australian Foundation Investment Company Limited Annual Report 2022

63Australian Foundation Investment Company Limited Annual Report 2022

OTHER INFORMATION
Information about Shareholders
At 19 July 2022 there were 165,141 holdings of ordinary shares. These holdings were distributed in the following categories:
Size of HoldingShareholdingsPercentage
1 to 1,00064,3722.07
1,001 to 5,00053,22910.95
5,001 to 10,00020,77312.23
10,001 to 100,00025,73251.30
100,000 and over1,03523.45
Total165,141100.00
Percentage held by the 20 largest holders6.91%
Average shareholding7,447
There were 4,314 shareholdings of less than a marketable parcel of $500 (65 shares).
Voting Rights of Ordinary Shares
The Constitution provides for votes to be cast:
(i) on a show of hands, one vote for each shareholder; and
(ii) on a poll, one vote for each fully paid ordinary share.
Major Shareholders
The 20 largest registered holdings of ordinary shares as at 19 July 2022 are listed below:
Ordinary Shares
RankNameShares% Shares
1HSBC Custody Nominees (Australia) Limited21,464,3621.75
2Citicorp Nominees Pty Limited11,779,3750.96
3Netwealth Investments Limited <Wrap Services A/C>7,181,8310.58
4Nulis Nominees (Australia) Limited <Navigator Mast Plan Sett A/C> 5,233,6540.43
5Australian Executor Trustees Limited <IPS IOOF Employer Super A/C>4,727,8200.38
6Bougainville Copper Limited4,301,9350.35
7Navigator Australia Ltd <MLC Investment SETT A/C>3,960,9140.32
8BNP Paribas Nominees Pty Ltd Hub24 Custodial Serv Ltd <DRP A/C>3,166,8930.26
9Custodial Services Limited <Beneficiaries Holding A/C>2,902,6070.24
10Netwealth Investments Limited <Super Services A/C>2,601,4710.21
11Bushways Pty Ltd2,570,5920.21
12Investment Custodial Services Limited <C A/C>2,284,1470.19
13Australian Executor Trustees Limited <IDPS A/C>1,959,6680.16
14Australian Executor Trustees Limited1,751,3950.14
15Custodial Services Limited <A/C 4>1,636,2870.13
16BNP Paribas Noms (Nz) Ltd <DRP>1,536,8980.12
17Kalymna Pty Ltd1,510,8860.12
18HSBC Custody Nominees (Australia) Limited <Euroclear Bank SA NV A/C>1,497,4590.12
19Twibill Pty Ltd1,443,2160.12
20J P Morgan Nominees Australia Pty Limited1,435,6620.12
64Australian Foundation Investment Company Limited Annual Report 2022

Sub-underwriting
During the year the Company did not participate as a sub-underwriter in any issues of securities.
Substantial Shareholders
The Company has not been notified of any substantial shareholders.
Transactions in Securities
During the year ended 30 June 2022, the Company recorded 793 transactions in securities (including options).
$3,130,512 in brokerage (including GST) was paid or accrued for the year.
65Australian Foundation Investment Company Limited Annual Report 2022

Major Transactions in the Investment Portfolio
Acquisitions
Cost
($’000)
Woodside Energy (merger with BHP Oil and Gas)74,888
Santos (merger with Oil Search)72,660
Transurban Group (includes $35.5 million in entitlement offer at $13 per share)65,548
Mirvac Group54,111
JB Hi-Fi52,191
CSL (includes $30.2 million in placement offer at $273 per share)50,109
Domino’s Pizza Enterprises46,376
Goodman Group45,103
Disposals
Proceeds
($’000)
Sydney Airport* 221,802
Oil Search* (merger with Santos)72,660
Qube Holdings*68,985
APA Group*57,159
Milton Corporation* 50,443
Lifestyle Communities*36,760
* Complete disposal from the portfolio.
New Companies Added to the Portfolio
Santos (merger with Oil Search)
Mirvac Group
JB Hi-Fi
WiseTech Global
66Australian Foundation Investment Company Limited Annual Report 2022

Holdings of Securities
At 30 June 2022
Individual investments for the combined investment and trading portfolios as at 30 June 2022 are listed below. The list should not,
however, be used to evaluate portfolio performance or to determine the net asset backing per share at other dates. Net asset backing
is advised to the Australian Securities Exchange each month and is recorded on the toll free telephone service at 1800 780 784 and
posted to AFIC’s website afi.com.au.
Individual holdings in the portfolios may change during the course of the year. In addition, holdings which are part of the trading
portfolio may be subject to call options or sale commitments by which they may be sold at a price significantly different from the
market price prevailing at the time of the exercise or sale.
CodeOrdinary Shares, Trust Units or Stapled Securities
Number
Held
2021
’000
Number
Held
2022
’000
Market
Value
2022
$’000
AIAAuckland International Airport6,07310,30066,743
ALQALS7,0127,62281,405
AMCAmcor11,60011,600209,265
ANNAnsell1,0791,36930,444
ANZAustralia and New Zealand Banking Group8,4888,488186,984
ARBARB Corporation3,5033,47398,065
ASXASX1,4321,432117,009
AUBAUB Group2,5262,37842,049
BHPBHP Group13,41313,926574,433
BXBBrambles9,2799,27999,374
CARCarsales.com6,0538,026147,602
CBACommonwealth Bank of Australia7,9007,900714,002
COHCochlear33433466,400
COLColes Group7,0689,023160,691
CPUComputershare4,0434,04399,607
CSLCSL2,1852,372638,076
CWYCleanaway Waste Management17,01417,01442,876
DJWDjerriwarrh Investments7,5057,50521,465
DMPDomino’s Pizza Enterprises25465344,416
DUIDiversified United Investment12,03012,03055,339
EQTEQT Holdings 1,3221,32234,626
FCLFINEOS Corporation7,3389,25313,694
FPHFisher & Paykel Healthcare Corporation3,9133,91369,799
GMGGoodman Group6,6858,835157,616
IAGInsurance Australia Group9,5279,52741,540
IELIDP Education56679018,809
IREIRESS7,0918,21194,511
IVCInvoCare3,5123,51236,740
JBHJB Hi-Fi01,13143,508
JHXJames Hardie Industries4,5905,245166,646
MFTMainfreight (NZX listed)3,2683,268206,524
MGRMirvac Group022,00043,450
MIRMirrabooka Investments8,7288,72825,573
MQGMacquarie Group2,2072,207362,997
NABNational Australia Bank11,15511,155305,530
NANNanosonics3,5455,97020,059
NWLNetwealth Group2,0903,48942,427
NXTNEXTDC7,8647,86483,678
ORIOrica2,2262,22635,100
PXAPEXA Group2,9192,91940,543
REAREA Group55364472,053
REHReece7,2017,20199,234
67Australian Foundation Investment Company Limited Annual Report 2022

Holdings of Securities
At 30 June 2022 continued
CodeOrdinary Shares, Trust Units or Stapled Securities
Number
Held
2021
’000
Number
Held
2022
’000
Market
Value
2022
$’000
RHCRamsay Health Care1,9151,583115,923
RIORio Tinto1,8621,862191,229
RMDResMed4,2504,750145,778
RWCReliance Worldwide Corporation10,9635,91823,910
RYMRyman Healthcare (NZX listed)8808807,084
SEKSeek3,6413,33369,985
SHLSonic Healthcare3,7043,320109,582
STOSantos011,28683,740
TCLTransurban Group23,86728,791414,012
TLSTelstra Corporation54,51048,680187,419
TPWTemple & Webster2,3673,84412,761
WBCWestpac Banking Corporation15,54515,545303,128
WDS*Woodside Energy Group3,6205,816184,894
WESWesfarmers7,3727,372308,961
WOWWoolworths Group6,4167,175255,420
WTCWiseTech Global02509,463
XROXero 83383364,108
Total7,998,297
* Part of the security was subject to call options written by the Company.
68Australian Foundation Investment Company Limited Annual Report 2022

Holdings of International Securities
At 30 June 2022
Ordinary Shares, Trust Units or Stapled Securities
Number
Held
2021
Number
Held*
2022
Market
Value
2022
A$
ACN-USAccenture2,760 5,506 2,223,158
AENA-ESAena4,993 10,728 1,977,600
GOOGL-USAlphabet642 1,534 4,861,461
AMZN-USAmazon6,980 23,360 3,607,952
AAPL-USApple4,788 21,658 4,306,044
SCHW-USCharles Schwab027,651 2,540,574
CMG-USChipotle 714 1,325 2,518,891
CTAS-USCintas 1,994 3,414 1,854,485
COST-USCostco 1,589 2,976 2,074,212
CCI-USCrown Castle4,226 10,886 2,665,546
EL-USEstée Lauder2,046 5,037 1,865,453
FERG-GBFerguson6,357 12,851 2,085,332
FTNT-USFortinet20,510 24,220 1,992,822
HCA-USHCA Healthcare5,511 10,619 2,595,284
HD-USHome Depot2,757 6,284 2,506,373
ICE-USIntercontinental7,772 15,643 2,139,337
JPM-USJP Morgan012,029 1,969,869
OR-FRL’Oréal790 3,018 1,510,932
MC-FRLVMH Moët 1,240 2,155 1,905,817
MAR-USMarriott6,266 9,615 1,901,751
MA-USMastercard1,421 3,461 1,587,838
MCD-USMcDonald’s4,188 8,702 3,124,192
META-USMeta Platforms (formerly Facebook)3,5532,889 677,442
MSFT-USMicrosoft7,066 16,083 6,006,840
NESN-CHNestlé9,176 18,826 3,186,865
NFLX-USNetflix2,257 3,792 964,306
NEE-USNextera 5,861 20,749 2,337,167
NKE-USNike7,784 13,173 1,957,771
NOVOB-DKNovo Nordisk8,634 12,978 2,088,550
PEP-USPepsiCo5,323 10,474 2,538,479
ROG-CHRoche 2,790 5,035 2,436,336
SPGI-USS&P Global2,558 3,927 1,924,858
SU-FRSchneider5,527 10,228 1,755,534
SOON-CHSonova 1,814 4,544 2,098,328
SBUX-USStarbucks8,598 11,612 1,289,977
669-HKTechtronic 31,777 125,890 1,909,751
TMO-USThermo Fisher1,684 3,523 2,783,346
V-USVisa3,461 4,977 1,425,015
Total89,195,485
* Note some increase in the number held are because of share splits through 2022.
69Australian Foundation Investment Company Limited Annual Report 2022

Issues of Securities
Date of IssueTypePriceRemarks
25 February 2022DRP/DSSP$7.865 per cent discount
31 August 2021DRP/DSSP$8.103.5 per cent discount
23 February 2021DRP/DSSP$7.105 per cent discount
1 September 2020DRP/DSSP$6.30
24 February 2020DRP/DSSP$6.932.5 per cent discount
29 August 2019DRP/DSSP$6.21
25 February 2019DRP/DSSP$5.932.5 per cent discount
31 August 2018DRP/DSSP$6.18
23 February 2018DRP/DSSP$6.11
30 August 2017DRP/DSSP$5.92
24 February 2017DRP/DSSP$5.84
30 August 2016DRP/DSSP$5.582.5 per cent discount
19 February 2016DRP/DSSP$5.432.5 per cent discount
25 November 2015SPP$5.515.0 per cent discount
28 August 2015DRP/DSSP$6.032.5 per cent discount
20 February 2015DRP/DSSP$5.972.5 per cent discount
6 October 2014 SPP$5.882.5 per cent discount
29 August 2014 DRP/DSSP$5.932.5 per cent discount
21 February 2014DRP/DSSP$5.862.5 per cent discount
30 August 2013DRP/DSSP$5.642.5 per cent discount
DSSP Dividend Substitution Share Plan
22 February 2013DRP$5.37
31 August 2012DRP$4.36
24 February 2012DRP$4.26
19 December 2011Convertible Notes$100 face valueMature 28 February 2017. Interest rate
6.25 per cent per annum. Conversion price:
$5.0864
31 August 2011DRP$4.18
25 February 2011DRP$4.722.5 per cent discount
1 September 2010DRP$4.652.5 per cent discount
2 June 2010SPP$4.622.5 per cent discount
26 February 2010DRP$4.825 per cent discount
SPP = Share Purchase Plan
1 September 2009DRP$4.695 per cent discount
2 March 2009 DRP$3.725 per cent discount
25 August 2008 DRP$4.98
11 April 2008SAP$5.26
27 February 2008DRP$5.265 per cent discount
22 August 2007DRP$5.78
8 March 2007DRP $5.60
22 December 2006SAP$4.90
23 August 2006DRP $4.70
7 March 2006DRP $4.55
4 November 2005SAP $3.96
23 August 2005DRP $3.90
70Australian Foundation Investment Company Limited Annual Report 2022

Date of IssueTypePriceRemarks
18 March 2005DRP $3.68
19 August 2004DRP $3.29
12 March 2004DRP $3.29
22 October 20031 for 8 rights issue $3.00
15 August 2003DRP $3.47
16 April 2003SAP $3.04
7 March 2003DRP $3.11
14 August 2002DRP $3.11
5 April 2002SAP$3.16
7 March 2002DRP$3.24
15 August 2001DRP$3.08
29 June 2001DRP $2.87
7 March 2001DRP $2.56
16 August 2000DRP$2.47
7 March 2000DRP $2.64
11 August 1999DRP $2.95
12 April 1999SAP$2.54 SAP = Share Acquisition Plan
15 March 1998DRP $2.79
4 September 1998DRP $2.43 DRP = Dividend Reinvestment Plan
Note for issues of securities in earlier years please consult the Company’s website, afi.com.au or via telephone (03) 9650 9911.
Note that for the shares issued under the DSSP, the price shown is the indicative price used to determine the number of shares issued to participants.
Shares issued under the DSSP are issued at nil cost. Shareholders who sell shares issued under the DSSP should consult their tax adviser as to the
correct treatment of such sales for taxation purposes.
71Australian Foundation Investment Company Limited Annual Report 2022

Company Particulars
Australian Foundation Investment
Company Limited (AFIC)
ABN 56 004 147 120
Directors
John Paterson, Chairman
Robert M Freeman, Managing Director
Rebecca P Dee-Bradbury
Craig M Drummond
Julie A Fahey
Graeme R Liebelt
David A Peever
Catherine M Walter AM
Peter J Williams
Company Secretaries
Matthew J Rowe
Andrew JB Porter
Auditor
PricewaterhouseCoopers
Chartered Accountants
Country of Incorporation
Australia
Registered Office and
Mailing Address
Level 21, 101 Collins Street
Melbourne Victoria 3000
Contact Details
Telephone (03) 9650 9911
Facsimile (03) 9650 9100
Email invest@afi.com.au
Website afi.com.au
For enquiries regarding net asset backing (as advised
each month to the Australian Securities Exchange):
Telephone 1800 780 784 (toll free)
72Australian Foundation Investment Company Limited Annual Report 2022

Australian Foundation Investment Company Limited Annual Report 202273
Shareholder Information
Share Registrar
Computershare Investor Services Pty Ltd
Yarra Falls
452 Johnston Street
Abbotsford Victoria 3067
New Zealand Address
Computershare Investor Services Limited
159 Hurstmere Road
Takapuna Auckland 0622
Shareholder
Enquiry Line 1300 662 270
+61 3 9415 4373 (from overseas)
Facsimile (03) 9473 2500
Website investorcentre.com/contact
For all enquiries relating to shareholdings,
dividends and related matters, please contact
the Share Registrar as above.
Securities Exchange Codes
AFI Ordinary shares (ASX and NZX)
Annual General Meeting
Time 10.00am
Date Tuesday 4 October 2022
Venue The Clarendon Auditorium
Melbourne Convention and
Exhibition Centre (MCEC)
Location 2 Clarendon Street
Southbank Victoria Australia
Subject to any change in the Government restrictions
for public gatherings, the AGM will be a hybrid meeting
with a physical meeting and access via an online platform.
Further details are provided in the Notice of Annual
General Meeting.
Adelaide Shareholder Meeting
Time 10.00am
Date Monday 17 October 2022
Venue Adelaide Convention Centre
North Terrace Adelaide
Location Hall E1 and E2
Perth Shareholder Meeting
Time 10.00am
Date Tuesday 18 October 2022
Venue Perth Convention Centre
21 Mounts Bay Road Perth
Location Meeting Rooms 1 and 2
Canberra Shareholder Meeting
Time 10.00am
Date Friday 21 October 2022
Venue Park Hyatt Hotel
120 Commonwealth Avenue Canberra
Location Federation Ballroom
Brisbane Shareholder Meeting
Time 10.00am
Date Monday 24 October 2022
Venue Brisbane Convention Centre
Cnr Merivale and Glenelg Streets
South Bank Brisbane
Location Sky Room
Sydney Shareholder Meeting
Time 10.00am
Date Tuesday 25 October 2022
Venue Wesley Conference Centre
220 Pitt Street Sydney
Location Auditorium

MDM Design
Printed on environmentally friendly paper

Annual Review
2022

2 5 Year Summary
4 About the Company
8 Review of Operations
and Activities
18 Top 25 Investments
19 Income Statement
20 Balance Sheet
21 Summarised Statement
of Changes in Equity
22 Holdings of Securities
25 Holdings of International
Securities
27 Major Transactions in the
Investment Portfolio
28 Company Particulars
29 Shareholder Information
Contents
AUSTRALIAN FOUNDATION
INVESTMENT COMPANY
IS A LISTED INVESTMENT
COMPANY INVESTING

IN AUSTRALIAN AND
NEW ZEALAND EQUITIES.
Australian Foundation Investment Company Limited ABN 56 004 147 120

Year in Summary
* Assumes a shareholder can take full advantage of the franking credits.
Profit for
the Year
$360.6m
$235.1m in 2021.
Up 53.4%
Total
Shareholder
Return
0 .1 %
Share price plus
dividend, including
franking*
Management
Expense
Ratio
0.16%
0.14%
in 2021
Total
Portfolio
Return
-6.8%
Including franking*
S&P/ASX 200
Accumulation
Index including
franking* -5.1%
Fully
Franked
Dividend
14
¢
Final
24
¢
Total
24 cents total
in 2021
2022
Total
Portfolio
$8.2b
Including cash
at 30 June.
$9.1 billion in 2021
1Australian Foundation Investment Company Limited Annual Review 2022

5 Year Summary
Net Profit After Tax
($ Million)
Net Profit Per Share
(Cents)
Dividends Per Share
(Cents)
(b)
Investments at Market Value
($ Million)
(d)
Net Asset Backing Per Share
($)
(e)
Number of Shareholders
(30 June)
272.2134.2
(a)
279.0
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
240.4
6.49
6.27
5.96
138,671
129,948
153,588
32
(c)
24
24
24
34.0
23.6
19.9
7,566
7,274
7,122
235.119.38,978
360.629.4
247.45159,500
246.63164,979
8
(c)
8,087
Net Profit After Tax
($ Million)
Net Profit Per Share
(Cents)
Dividends Per Share
(Cents)
(b)
Investments at Market Value
($ Million)
(d)
Net Asset Backing Per Share
($)
(e)
Number of Shareholders
(30 June)
272.2134.2
(a)
279.0
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
240.4
6.49
6.27
5.96
138,671
129,948
153,588
32
(c)
24
24
24
34.0
23.6
19.9
7,566
7,274
7,122
235.1
19.38,978
360.629.4
247.45159,500
246.63164,979
8
(c)
8,087
Net Profit After Tax
($ Million)
Net Profit Per Share
(Cents)
Dividends Per Share
(Cents)
(b)
Investments at Market Value
($ Million)
(d)
Net Asset Backing Per Share
($)
(e)
Number of Shareholders
(30 June)
272.2134.2
(a)
279.0
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
240.4
6.49
6.27
5.96
138,671
129,948
153,588
32
(c)
24
24
24
34.0
23.6
19.9
7,566
7,274
7,122
235.119.38,978
360.629.4
247.45159,500
246.63164,979
8
(c)
8,087
2Australian Foundation Investment Company Limited Annual Review 2022

Net Profit After Tax
($ Million)
Net Profit Per Share
(Cents)
Dividends Per Share
(Cents)
(b)
Investments at Market Value
($ Million)
(d)
Net Asset Backing Per Share
($)
(e)
Number of Shareholders
(30 June)
272.2134.2
(a)
279.0
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
240.4
6.49
6.27
5.96
138,671
129,948
153,588
32
(c)
24
24
24
34.0
23.6
19.9
7,566
7,274
7,122
235.1
19.38,978
360.629.4
247.45
159,500
246.63164,979
8
(c)
8,087
Notes
(a) Participation in the Rio Tinto and BHP
off-market share buy-backs, special
dividends and the receipt of a dividend
because of the Coles demerger from
Wesfarmers.
(b) All dividends were fully franked.
The LIC attributable gain attached
to the dividend was 2021: 4.29 cents,
2020: 7.14 cents, 2019: 7.14 cents,
2018: 2.86 cents, 2017: nil.
(c) 8 cents fully franked special dividend
paid with the interim dividend.
(d) Excludes cash.
(e) Net asset backing per share based on
year-end data before the provision for
the final dividend. The figures do not
include a provision for capital gains
tax that would apply if all securities held
as non-current investments had been
sold at balance date as Directors do
not intend to dispose of the portfolio.
Net Profit After Tax
($ Million)
Net Profit Per Share
(Cents)
Dividends Per Share
(Cents)
(b)
Investments at Market Value
($ Million)
(d)
Net Asset Backing Per Share
($)
(e)
Number of Shareholders
(30 June)
272.2134.2
(a)
279.0
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
2021
2020
2019
2018
2022
240.4
6.49
6.27
5.96
138,671
129,948
153,588
32
(c)
24
24
24
34.0
23.6
19.9
7,566
7,274
7,122
235.1
19.38,978
360.629.4
24
7.45159,500
24
6.63164,979
8
(c)
8,087
3Australian Foundation Investment Company Limited Annual Review 2022

Investment Philosophy
The investment philosophy is built
on taking a medium to long term view
on companies in a diversified portfolio
with an emphasis on identifying quality
companies that are likely to sustainably
grow their earnings and dividends over
this time frame.
Quality in this context is an outcome
of our assessment of the board and
management as well as some key
financial metrics. These include
return
on capital employed, return on equity,
the level of gearing in the balance
sheet, margins and free cash flow. The
structure of the industry and a company’s
competitive position in this industry is also
an important indicator of quality. Linked to
this assessment of quality is the ability
of companies to grow earnings over time,
which ultimately should produce good
dividend growth.
Recognising value is also an important
aspect of sound long term investing.
Short term measures such as the price
earnings ratio, price to book or price to
sales may be of some value, but aren’t
necessarily strong predictors of future
performance. Our assessment of value
tries to capture the opportunity a business
has to prosper and thrive over the
medium to long term.
In building the investment portfolio in this
way, we believe we can offer investors a
well-diversified portfolio of high-quality
companies that is intended to deliver total
returns ahead of the Australian equity
market and with less volatility over
the long term.
The Company also uses options
written against a small proportion of its
investments and a small trading portfolio
to generate additional income.
From time to time, some borrowings
may be used where potential investment
returns justify the use of debt. This is
managed within very conservative limits,
as determined by the Board. AFIC
is managed for the benefit of its
shareholders with fees based on the
recovery of costs rather than as a fixed
percentage of the portfolio. There are no
performance fees. As a result, the benefit
of scale over time results in a very low
expense ratio for investors. For the 12
months to 30 June 2022 this was 0.16 per
cent, or 16 cents for each $100 invested.
Approach to Environmental, Social
and Governance (ESG) Issues
Environmental, Social and Governance
(ESG) issues are taken into account as
part of our investment process when
assessing companies. As a long term
investor, we seek to invest in companies
that have strong governance and risk
management processes, which includes
consideration of environmental and social
risks given the potential for these factors
to impact investment performance.
We are also closely monitoring the
development of international standards
for ESG reporting as these may further
inform our approach going forward.
Approach to Investing
5Australian Foundation Investment Company Limited Annual Review 2022

We regularly review and meet with
companies to ensure ongoing alignment of
ESG issues with our investment framework:
• We believe environmental factors,
including the impact of climate change,
can have a material impact on society.
These factors are considered when
assessing a company’s assets, long
term sustainability of earnings and cash
flow, cost of capital and future growth
opportunities.
As reporting becomes more
standardised, assessment of
commitments and plans by companies
to reach net zero by 2050 will also
be considered having regard to the
industry in which it operates, their
progress against these plans and their
broader contribution to social good in
addressing the challenge of reducing
global carbon emissions. In applying
external data for benchmarking*, the
current carbon intensity of AFIC’s
portfolio is considerably less than the
S&P/ASX 200 Index.
• We believe that aligning ourselves
with high-quality management and
boards building sustainable long term
businesses is the best approach to
avoiding socially harmful businesses.
We are attracted to companies that
act in the best interest of all their
stakeholders, including their employees,
customers, suppliers and wider
communities. Where appropriate, we
consider a range of matters including
safety, diversity and modern slavery

as part of the investment process.
• We invest in high-quality companies
with strong governance processes,
and management and boards whose
interests are closely aligned with
shareholders. The investment process
includes an assessment of their
past performance, history of capital
allocation, level of accountability,
mix of skills, relevant experience and
succession planning. We also closely
scrutinise a company’s degree of
transparency and disclosure.
Engagement with Companies
Voting on resolutions is one of the key
functions that a shareholder has in
ensuring better long term returns and
management of investment risk:
• We take input from proxy advisers

but conduct our own evaluation
of the merits of any resolution.
• We vote on all company resolutions as
part of our regular engagement with the
companies in the portfolio. Our voting
record is on the Company’s website.
• We actively engage with companies
when we have concerns those
resolutions are not aligned with
shareholders’ interests. We
acknowledge that high-quality
companies may face ESG challenges.
We seek to stay engaged with the
companies and satisfy ourselves that the
issues are taken seriously and worked
through constructively. Ideally, in this
instance, we seek to remain invested

to influence a satisfactory outcome
for stakeholders.
* Data provided by ISS ESG.
Portfolio at 30 June 2022.
About the Company
continued
Approach to Investing continued
6Australian Foundation Investment Company Limited Annual Review 2022

7Australian Foundation Investment Company Limited Annual Review 2022

Profit and Dividend
The full year profit was $360.6 million,
up from $235.1 million in the previous
corresponding period. The profit to
30 June 2022 includes a dividend of
$74.9 million (which was non-cash but
carries franking credits with it) resulting
from the BHP Petroleum/Woodside
merger. Last year’s figure included a
demerger dividend of $36.5 million
resulting from the Endeavour Group
demerger from Woolworths. Excluding
both one-offs, the full year profit for
the financial year to 30 June 2022 was
$285.7 million, up from $198.6 million
in the previous corresponding period.
The increase in profit for the 2021–2022
financial year was driven by higher
dividends received from investee
companies.
Earnings per share for the financial year,
excluding the BHP Petroleum/Woodside
merger non-cash dividend, were
23.3 cents per share. The final dividend
was maintained at 14 cents per share
fully franked bringing total fully franked
dividends applicable for the year to
24 cents per share, the same as last year.
Ten cents of the final dividend were
sourced from taxable capital gains, on
which the Company has paid or will pay
tax. The amount of the pre-tax attributable
gain on this portion of the dividend, known
as an ‘LIC capital gain’, is equal to
14.29 cents per share. The enables some
shareholders to claim a tax deduction
in their tax return.
Market and Portfolio
Performance
Following on from the recent strong share
market returns since monetary policy was
eased and significant fiscal stimulus was
introduced in response to the COVID-19
pandemic, the Australian share market
continued to enjoy strong positive returns
in the first six months of the financial
year as interest rates remained low and
valuations for many companies were very
high. These conditions were eventually
overwhelmed in the second half of the
financial year as inflation emerged, driving
interest rates higher. Geopolitical events
further exacerbated market volatility
producing a significant divergence
of returns across the market.
Figure 1 provides some context to the
market decline over the financial year to
30 June 2022 given market movements
since the onset of the initial COVID-19
pandemic in 2019.
Overall, the S&P/ASX 200 Accumulation
Index (including franking) fell 5.1 per cent
over the 12 months to 30 June 2022 as
there was a rotation away from quality
growth stocks to a focus on short term
value. The previously underperforming
Utilities sector was up 36.0 per cent over
the period and Energy, which responded
to rising oil prices resulting from
Russia’s invasion of the Ukraine, was
up 30.1 per cent. In contrast, previous
strong-performing sectors such as
Information Technology and Consumer
Discretionary were down 38.2 per cent
and 20.9 per cent respectively (Figure 2).
Review of Operations and Activities
8Australian Foundation Investment Company Limited Annual Review 2022

The portfolio had a negative return of
6.8 per cent including franking, with the
largest drag on performance being the
decline in the valuation of many high-
quality companies from their previous
very high levels. We remain convinced
about the prospects for these companies
despite the recent decline in share prices.
In addition, relative performance to the
Index was impacted by the underweight
position in resources, which includes
energy stocks, and the sale of Sydney
Airport and Milton Corporation
because of takeovers which generated
a significant amount of capital gains tax.
Companies in the portfolio that performed
relatively well against the Index through
the 12-month period were Amcor, Sydney
Airport (now taken over), Transurban
Group, Ramsay Health Care, which is
currently subject to an expression of
interest offer, Macquarie Group and
Computershare.
The long term performance of the
portfolio, which is better aligned with
the Company’s investment time frames,
was 10.5 per cent per annum for the
10 years to 30 June 2022 (Figure 3).
The Index return over the same period
was 10.9 per cent per annum. These
figures include the benefit of franking.
AFIC’s performance numbers are after
costs. Performance has been achieved
with low portfolio turnover, providing very
tax effective returns for shareholders
and with more consistent dividends.
These returns have also been delivered
with very low volatility, achieving an
attractive profile of return relative
to risk for investors.
Review of Operations and Activities
continued
10 year return
Net asset per share growth plus dividends,
including franking
S&P/ASX 200 Accumulation Index,
including franking
1 year return3 year return5 year return
6.0%
4.6%
-6.8%
-5.1%
8.4%
8.3%
10.5%
10.9%
Figure 3: Portfolio Performance – Per Annum Returns to 30 June 2022
10Australian Foundation Investment Company Limited Annual Review 2022

11Australian Foundation Investment Company Limited Annual Review 2022

Review of Operations and Activities
continued
Positioning the Portfolio
The majority of purchases during
the year focused on increasing
weightings to existing holdings including
Transurban Group, CSL, Domino’s Pizza
Enterprises, Coles Group, Goodman
Group, Carsales.com and Auckland
International Airport.
We also initiated positions in JB Hi-Fi,
Mirvac Group and a small holding in
WiseTech Global. JB Hi-Fi is the largest
consumer electronics retailer in Australia
and New Zealand. While primarily
providing attractive income to the
portfolio we expect the consumer
electronics category to continue
delivering meaningful growth.
Mirvac Group is a diversified property
company with operations across
residential, commercial and industrial
markets. Mirvac Group’s in-house
property development capability is
relatively unique to the sector and
provides a competitive advantage.
The company’s growth is largely sourced
from product generation and less reliant
on acquiring established assets.
During the 12-month period we exited
Qube Holdings, APA Group, Lifestyle
Communities, Origin Energy, Endeavour
Group and Altium. We are observing
structural industry challenges for many
of these companies or an environment
where competitive intensity has materially
increased. We consider the growth
prospects for all these companies to
be increasingly challenged as a result.
Additionally, we exited our holding in
Milton Corporation and Sydney Airport
as a result of takeovers.
The ability to reinvest the cash from these
takeovers was important during the year
as these funds were deployed elsewhere
in the portfolio in companies with good
long term growth opportunities.
We seek to have a diversified portfolio that
covers a range of sectors and industries.
This also allows us to better spread risk
through different market cycles. Figure 4
highlights the profile of AFIC’s portfolio
by the various sectors of the market
at the end of the financial year and
how it differs from the Index.
International Portfolio
We have continued to manage and
carefully add to positions in the diversified
global equities portfolio which was
first initiated in May 2021. Through
a combination of these additional
investments and portfolio returns, we
now have approximately $89.2 million
invested (which represents approximately
1.1 per cent of the portfolio).
Leveraging our investment philosophy
in the domestic market, the approach
to international equities is similar. The
international strategy invests in publicly
listed companies outside the Australian
and New Zealand markets with a medium
to long term investment time horizon.
12Australian Foundation Investment Company Limited Annual Review 2022

It focuses on high quality companies
with strong management teams and
competitive advantages that we view
as sustainable, often underpinned by long
term secular growth trends. With inherent
business characteristics that allow these
companies to generate an attractive return
on capital, the selected companies are
expected to generate a reasonable level
of return for our shareholders through
a combination of earnings growth and
dividends. We look to invest at a starting
valuation that is sensible in the context
of the expected return and the risk
associated with each investment.
This activity is potentially a precursor
to establishing a separate low-cost
international Listed Investment
Company in the future.
AFIC portfolio weightS&P/ASX 200 Index weight
18.6%14.8%14.5%12.7%9.1%6.9%0.0%5.9%3.3%5.1%1.7%3.0%4.5%
25%
20%
15%
10%
5%
0%
Banks
Healthcare
Materials
Industrials
Other
Financials
Consumer
Discretionary
Consumer
Staples
Communication
Services
Information
Technology
Energy
Real
Estate
Cash
Utilities
Figure 4: AFIC Investment by Sector Versus the S&P/ASX 200 Index
as at 30 June 2022 – Excludes International Holdings
13Australian Foundation Investment Company Limited Annual Review 2022

Review of Operations and Activities
continued
Share Price Return
The share price return, including
reinvestment of dividends and franking
credits, over the 12 months to 30 June
2022 was flat at 0.1 per cent, which is
ahead of the portfolio return for the year.
The share price was trading at a premium
of 13 per cent to the net asset backing
(before tax on unrealised gains) at
the end of June 2022, whereas at
30 June 2021 the premium was
5 per cent (Figure 5).
Importantly, the long term, 10-year
return is 12.2 per cent for the share price
in comparison to 10.9 per cent for the
Index (Figure 6). The figures for the Index
and share price assumes a shareholder
can take full advantage of the franking
credits attached to the dividends paid.
Outlook
During the year strengthening demand
produced supply chain challenges in
many industries, which contributed to a
meaningful increase in reported inflation.
In endeavouring to achieve price stability,
central banks signalled the end of
stimulatory policy settings. Equity markets
are now facing challenges on multiple
fronts, slowing economic growth, inflation
and interest rate hikes. As a result, the
uncertain environment that produced a
fall in equity markets during the financial
year is unlikely to be materially different
in the short term.
While the market has moved closer to
long term value as measured by price
to sales ratio (Figure 7 on page 16) and
price to book ratio (Figure 8 on page 17) we
are comfortable with the current portfolio
settings and can afford to be patient with
our capital until attractive opportunities
present themselves.
14Australian Foundation Investment Company Limited Annual Review 2022

15%
-10%
-5%
0%
5%
10%
20%
Jun 1
1
Jun 1
2
Jun 1
3
Jun 1
5
Jun 1
4
Jun 1
6
Jun 1
7
Jun 1
8
Jun 19Jun 20Jun 21Jun 22
Figure 5: Share Price Premium/Discount to Net Asset Backing
10 year return
Share price growth plus dividends,
including franking
S&P/ASX 200 Accumulation Index,
including franking
1 year return3 year return5 year return
11.6%
4.6%
0.1%
-5.1%
11.3%
8.3%
12.2%
10.9%
Figure 6: Share Price Return − to 30 June 2022
15Australian Foundation Investment Company Limited Annual Review 2022

Review of Operations and Activities
continued
In this context it is also worth noting
even though the valuation of the market,
as measured by price earnings ratio
(Figure 9), has moved well below the
long term average it is against the
background of very high profit margins
which may come under pressure in
the near term given expected difficult
economic conditions.
Directorship Matters
Mr Peter Williams, a Non-Executive
Director of the Company has advised that
he will not seek re-election at the 2022
Annual General Meeting and will retire at
the conclusion of the meeting to be held
on 4 October 2022.
Mr Williams has been a Director since
2010 and is currently the Chairman of the
Audit Committee and a member of the
Investment and Nomination Committees.
Mr Williams is also the Non-Executive
Chairman of the Company’s subsidiary,
Australian Investment Company Services
Limited.
The Board has greatly benefited from
Mr Williams’ extensive experience. The
Board wishes to record its thanks to Peter
for his significant contribution and service
to the Board during his tenure and wish
him well for the future.
20022007201220172022
Times
2.4
2.0
1.6
1.2
Average
1.9
Figure 7: Valuation of the Market – Price to Sales of the S&P/ASX 200 Index
Source: FactSet
16Australian Foundation Investment Company Limited Annual Review 2022

20022007201220172022
Times
Average 1.9
3.0
2.5
2.0
1.5
1.0
Figure 8: Valuation of the Market – Price to Book of the S&P/ASX 200 Index
22
20
18
16
14
12
10
8
20022003200420052006200720082009201020112012201320142015201620172018201920202021
Times
Average
14.5
Figure 9: Valuation of the Market – Price to Earnings Ratio of the S&P/ASX 200 Index
Source: FactSet
Source: FactSet
17Australian Foundation Investment Company Limited Annual Review 2022

Includes investments held in both the investment and trading portfolios.
Value at Closing Prices at 30 June 2022
Total Value
$ Million
% of the
Portfolio
1Commonwealth Bank of Australia714.08.8
2CSL 638.17.9
3BHP Group 574.47.1
4Transurban Group 414.05.1
5Macquarie Group 363.04.5
6Wesfarmers 309.03.8
7National Australia Bank 305.53.8
8Westpac Banking Corporation303.13.7
9Woolworths Group 255.43.2
10Amcor209.32.6
11Mainfreight 206.52.6
12Rio Tinto 191.22.4
13Telstra Corporation 187.42.3
14Australia and New Zealand Banking Group 187.02.3
15Woodside Energy Group* 184.92.3
16James Hardie Industries166.62.1
17Coles Group 160.72.0
18Goodman Group157.61.9
19Carsales.com 147.61.8
20ResMed 145.81.8
21ASX 117.01.4
22Ramsay Health Care 115.91.4
23Sonic Healthcare 109.61.4
24Computershare 99.61.2
25Brambles 99.41.2
Total6,362.7
As percentage of total portfolio value (excludes cash)78.7%
* Indicates that options were outstanding against part of the holding.
Top 25 Investments
As at 30 June 2022
18Australian Foundation Investment Company Limited Annual Review 2022

2022
$’000
2021
$’000
Dividends and distributions388,492257,874
Revenue from deposits and bank bills61116
Net gains on trading portfolio (including unrealised
gains or losses)6292,472
Total income389,182260,462
Finance costs(845)(1,831)
Administration expenses (net of recoveries)(14,294)(10,678)
Profit before income tax 374,043247,953
Income tax (13,486)(12,858)
Net profit 360,557235,095
CentsCents
Net profit per share29.4019.28
Income Statement
For The Year Ended 30 June 2022
19Australian Foundation Investment Company Limited Annual Review 2022

2022
$’000
2021
$’000
Current assets
Cash 144,61997,122
Receivables36,59840,011
Trading portfolio4,9794,745
Total current assets186,196141,878
Non-current assets
Investment portfolio 8,082,5138,973,080
Deferred tax assets-59
Total non-current assets8,082,5138,973,139
Total assets8,268,7099,115,017
Current liabilities
Payables28,6881,020
Borrowings – bank debt10,000-
Tax payable62,56712,621
Provisions6,1145,235
Total current liabilities107,36918,876
Non-current liabilities
Provisions896888
Deferred tax liabilities – other503-
Deferred tax liabilities – investment portfolio1,169,4521,536,231
Total non-current liabilities1,170,8511,537,119
Total liabilities1,278,2201,555,995
Net assets6,990,4897,559,022
Shareholders’ equity
Share capital3,070,2133,007,780
Revaluation reserve2,556,4663,394,297
Realised capital gains reserve510,503416,071
General reserve23,63723,637
Retained profits829,670717,237
Total shareholders’ equity (including minority interests)6,990,4897,559,022
Balance Sheet
As at 30 June 2022
20Australian Foundation Investment Company Limited Annual Review 2022

2022
$’000
2021
$’000
Total equity at the beginning of the year7,559,0226,240,517
Dividends paid(283,554)(282,473)
Shares issued – Dividend Reinvestment Plan62,58460,632
Other share capital adjustments(151)(145)
Total transactions with shareholders(221,121)(221,986)
Profit for the year 360,557235,095
Revaluation of investment portfolio(1,008,188)1,881,261
Provision for tax on revaluation300,219(575,865)
Revaluation of investment portfolio (after tax)(707,969)1,305,396
Total comprehensive income for the year(347,412)1,540,491
Realised gains on securities sold196,42290,262
Tax expense on realised gains on securities sold(66,560)(13,133)
Net realised gains/(losses) on securities sold129,86277,129
Transfer from revaluation reserve to realised gains reserve(129,862)(77,129)
Total equity at the end of the year6,990,4897,559,022
A full set of AFIC’s final accounts are available on the Company’s website.
Summarised Statement of Changes in Equity
For the Year Ended 30 June 2022
21Australian Foundation Investment Company Limited Annual Review 2022

Individual investments for the combined investment and trading portfolios as at
30 June 2022 are listed below. The list should not, however, be used to evaluate
portfolio performance or to determine the net asset backing per share at other dates.
Net asset backing is advised to the Australian Securities Exchange each month and
is recorded on the toll free telephone service at 1800 780 784 and posted to AFIC’s
website afi.com.au.
Individual holdings in the portfolios may change during the course of the year. In addition,
holdings which are part of the trading portfolio may be subject to call options or sale
commitments by which they may be sold at a price significantly different from the
market price prevailing at the time of the exercise or sale.
Code
Ordinary Shares, Trust Units
or Stapled Securities
Number
Held
2021
’000
Number
Held
2022
’000
Market
Value
2022
$’000
AIAAuckland International Airport6,07310,30066,743
ALQALS7,0127,62281,405
AMCAmcor11,60011,600209,265
ANNAnsell1,0791,36930,444
ANZAustralia and New Zealand
Banking Group
8,4888,488186,984
ARBARB Corporation3,5033,47398,065
ASXASX1,4321,432117,009
AUBAUB Group2,5262,37842,049
BHPBHP Group13,41313,926574,433
BXBBrambles9,2799,27999,374
CARCarsales.com6,0538,026147,602
CBACommonwealth Bank of Australia7,9007,900714,002
COHCochlear33433466,400
COLColes Group7,0689,023160,691
CPUComputershare4,0434,04399,607
CSLCSL2,1852,372638,076
CWYCleanaway Waste Management17,01417,01442,876
DJWDjerriwarrh Investments7,5057,50521,465
DMPDomino’s Pizza Enterprises25465344,416
Holdings of Securities
At 30 June 2022
22Australian Foundation Investment Company Limited Annual Review 2022

Code
Ordinary Shares, Trust Units
or Stapled Securities
Number
Held
2021
’000
Number
Held
2022
’000
Market
Value
2022
$’000
DUIDiversified United Investment12,03012,03055,339
EQTEQT Holdings 1,3221,32234,626
FCLFINEOS Corporation7,3389,25313,694
FPHFisher & Paykel Healthcare
Corporation
3,9133,91369,799
GMGGoodman Group6,6858,835157,616
IAGInsurance Australia Group9,5279,52741,540
IELIDP Education56679018,809
IREIRESS7,0918,21194,511
IVCInvoCare3,5123,51236,740
JBHJB Hi-Fi01,13143,508
JHXJames Hardie Industries4,5905,245166,646
MFTMainfreight (NZX listed)3,2683,268206,524
MGRMirvac Group022,00043,450
MIRMirrabooka Investments8,7288,72825,573
MQGMacquarie Group2,2072,207362,997
NABNational Australia Bank11,15511,155305,530
NANNanosonics3,5455,97020,059
NWLNetwealth Group2,0903,48942,427
NXTNEXTDC7,8647,86483,678
ORIOrica2,2262,22635,100
PXAPEXA Group2,9192,91940,543
REAREA Group55364472,053
REHReece7,2017,20199,234
RHCRamsay Health Care1,9151,583115,923
RIORio Tinto1,8621,862191,229
RMDResMed4,2504,750145,778
RWCReliance Worldwide Corporation10,9635,91823,910
RYMRyman Healthcare (NZX listed)8808807,084
SEKSeek3,6413,33369,985
23Australian Foundation Investment Company Limited Annual Review 2022

Holdings of Securities
At 30 June 2022 continued
Code
Ordinary Shares, Trust Units
or Stapled Securities
Number
Held
2021
’000
Number
Held
2022
’000
Market
Value
2022
$’000
SHLSonic Healthcare3,7043,320109,582
STOSantos011,28683,740
TCLTransurban Group23,86728,791414,012
TLSTelstra Corporation54,51048,680187,419
TPWTemple & Webster2,3673,84412,761
WBCWestpac Banking Corporation15,54515,545303,128
WDS*Woodside Energy Group3,6205,816184,894
WESWesfarmers7,3727,372308,961
WOWWoolworths Group6,4167,175255,420
WTCWiseTech Global02509,463
XROXero 83383364,108
Total7,998,297
* Part of the security was subject to call options written by the Company.
24Australian Foundation Investment Company Limited Annual Review 2022

Holdings of International Securities
At 30 June 2022
Code
Ordinary shares, trust units or
stapled securities
Number
Held
2021
Number
Held*
2022
Market
Value
2022
A$
ACN-USAccenture2,760 5,506 2,223,158
AENA-ESAena4,993 10,728 1,977,600
GOOGL-USAlphabet642 1,534 4,861,461
AMZN-USAmazon6,980 23,360 3,607,952
AAPL-USApple4,788 21,658 4,306,044
SCHW-USCharles Schwab027,651 2,540,574
CMG-USChipotle 714 1,325 2,518,891
CTAS-USCintas 1,994 3,414 1,854,485
COST-USCostco 1,589 2,976 2,074,212
CCI-USCrown Castle4,226 10,886 2,665,546
EL-USEstée Lauder2,046 5,037 1,865,453
FERG-GBFerguson6,357 12,851 2,085,332
FTNT-USFortinet20,510 24,220 1,992,822
HCA-USHCA Healthcare5,511 10,619 2,595,284
HD-USHome Depot2,757 6,284 2,506,373
ICE-USIntercontinental7,772 15,643 2,139,337
JPM-USJP Morgan012,029 1,969,869
OR-FRL’Oréal790 3,018 1,510,932
MC-FRLVMH Moët 1,240 2,155 1,905,817
MAR-USMarriott6,266 9,615 1,901,751
MA-USMastercard1,421 3,461 1,587,838
MCD-USMcDonald’s4,188 8,702 3,124,192
META-USMeta Platforms (formerly Facebook)3,5532,889 677,442
MSFT-USMicrosoft7,066 16,083 6,006,840
NESN-CHNestlé9,176 18,826 3,186,865
NFLX-USNetflix2,257 3,792 964,306
NEE-USNextera 5,861 20,749 2,337,167
NKE-USNike7,784 13,173 1,957,771
25Australian Foundation Investment Company Limited Annual Review 2022

Holdings of International Securities
At 30 June 2022 continued
Code
Ordinary shares, trust units or
stapled securities
Number
Held
2021
Number
Held*
2022
Market
Value
2022
A$
NOVOB-DKNovo Nordisk8,634 12,978 2,088,550
PEP-USPepsiCo5,323 10,474 2,538,479
ROG-CHRoche 2,790 5,035 2,436,336
SPGI-USS&P Global2,558 3,927 1,924,858
SU-FRSchneider5,527 10,228 1,755,534
SOON-CHSonova 1,814 4,544 2,098,328
SBUX-USStarbucks8,598 11,612 1,289,977
669-HKTechtronic 31,777 125,890 1,909,751
TMO-USThermo Fisher1,684 3,523 2,783,346
V-USVisa3,461 4,977 1,425,015
Total89,195,485
* Note some increase in the number held are because of share splits through 2022.
26Australian Foundation Investment Company Limited Annual Review 2022

Acquisitions
Cost
($’000)
Woodside Energy (merger with BHP Oil and Gas)74,888
Santos (merger with Oil Search)72,660
Transurban Group (includes $35.5 million in entitlement offer at $13 per share)65,548
Mirvac Group54,111
JB Hi-Fi52,191
CSL (includes $30.2 million in placement offer at $273 per share)50,109
Domino’s Pizza Enterprises46,376
Goodman Group45,103
Disposals
Proceeds
($’000)
Sydney Airport* 221,802
Oil Search* (merger with Santos)72,660
Qube Holdings*68,985
APA Group*57,159
Milton Corporation* 50,443
Lifestyle Communities*36,760
* Complete disposal from the portfolio.
New Companies Added to the Portfolio
Santos (merger with Oil Search)
Mirvac Group
JB Hi-Fi
WiseTech Global
Major Transactions in the
Investment Portfolio
27Australian Foundation Investment Company Limited Annual Review 2022

Australian Foundation Investment
Company Limited (AFIC)
ABN 56 004 147 120
Directors
John Paterson, Chairman
Robert M Freeman, Managing Director
Rebecca P Dee-Bradbury
Craig M Drummond
Julie A Fahey
Graeme R Liebelt
David A Peever
Catherine M Walter AM
Peter J Williams
Company Secretaries
Matthew J Rowe
Andrew JB Porter
Auditor
PricewaterhouseCoopers
Chartered Accountants
Country of Incorporation
Australia
Registered Office and
Mailing Address
Level 21, 101 Collins Street
Melbourne Victoria 3000
Contact Details
Telephone (03) 9650 9911
Facsimile (03) 9650 9100
Email invest@afi.com.au
Website afi.com.au
For enquiries regarding net asset backing
(as advised each month to the Australian
Securities Exchange):
Telephone 1800 780 784 (toll free)
Company Particulars
28Australian Foundation Investment Company Limited Annual Review 2022

Share Registrar
Computershare Investor Services Pty Ltd
Yarra Falls
452 Johnston Street
Abbotsford Victoria 3067
New Zealand Address
Computershare Investor Services Limited
159 Hurstmere Road
Takapuna Auckland 0622
Shareholder
Enquiry Line 1300 662 270
+61 3 9415 4373
(from overseas)
Facsimile (03) 9473 2500
Website investorcentre.com/
contact
For all enquiries relating to shareholdings,
dividends and related matters, please
contact the Share Registrar as above.
Securities Exchange Codes
AFI Ordinary shares
(ASX and NZX)
Annual General Meeting
Time 10.00am
Date Tuesday 4 October 2022
Venue The Clarendon Auditorium
Melbourne Convention
and Exhibition Centre
(MCEC)
Location 2 Clarendon Street
Southbank Victoria
Australia
Shareholder Information
Subject to any change in the Government
restrictions for public gatherings, the AGM
will be a hybrid meeting with a physical
meeting and access via an online platform.
Further details are provided in the Notice
of Annual General Meeting.
Adelaide Shareholder Meeting
Time 10.00am
Date Monday 17 October 2022
Venue Adelaide Convention Centre
North Terrace Adelaide
Location Hall E1 and E2
Perth Shareholder Meeting
Time 10.00am
Date Tuesday 18 October 2022
Venue Perth Convention Centre
21 Mounts Bay Road Perth
Location Meeting Rooms 1 and 2
Canberra Shareholder Meeting
Time 10.00am
Date Friday 21 October 2022
Venue Park Hyatt Hotel
120 Commonwealth Avenue
Canberra
Location Federation Ballroom
Brisbane Shareholder Meeting
Time 10.00am
Date Monday 24 October 2022
Venue Brisbane Convention Centre
Cnr Merivale and Glenelg Streets
South Bank Brisbane
Location Sky Room
Sydney Shareholder Meeting
Time 10.00am
Date Tuesday 25 October 2022
Venue Wesley Conference Centre
220 Pitt Street Sydney
Location Auditorium
29Australian Foundation Investment Company Limited Annual Review 2022

MDM Design
Printed on environmentally friendly paper

288500_23_V5
Dear Shareholder,
I am pleased to invite you to the 2022 Annual General Meeting (AGM) of Australian Foundation
Investment Company Limited (AFIC or the Company) which has been scheduled as follows:
Date: Tuesday 4 October 2022
Time: 10.00am Australian Eastern Daylight Time (AEDT)
The AGM will be held as a hybrid meeting providing shareholders with an opportunity to either
attend in person or to participate online.
To attend in person and engage with Directors, shareholders are invited to attend the Clarendon
Auditorium at the Melbourne Convention and Exhibition Centre (MCEC) 2 Clarendon Street,
Southbank, Victoria, Australia.
If shareholders are attending online they must use the Computershare Meeting Platform to
participate in the meeting. To participate in the meeting, you can log in by entering the following
URL https://meetnow.global/M566RZV on your computer, tablet or smartphone.
Shareholders who participate in the AGM online using the online platform are able to ask
questions via this platform and vote in real time.
Full details on how to lodge a proxy or direct vote, attend and participate in the AGM are set out
in our Notice of Meeting.
Notice of Meeting
In accordance with the recent amendments to the Corporations Act 2001 (Cth), we will not
be posting to you a hard copy of the Notice of Meeting ahead of our AGM unless you have
specifically requested one. Please visit www.afi.com.au to view and download our Notice of
Meeting, our Annual Report and other meeting documents are also available on this webpage.
Voting Form
If you are unable to join us for the AGM, we encourage you to lodge a vote prior to the meeting
or, alternatively, to appoint a proxy to attend either in person or virtually, and vote on your behalf.
Enclosed with this letter is a hard copy of your Voting Form which is personalised to you. Please
complete the Voting Form if you would like to appoint a proxy to attend the meeting and vote on
your behalf. Page 6 of the Notice of Meeting sets out the various ways in which you can submit
the Voting Form. Please note that for a proxy appointment to be effective, it must be received by
10.00am (AEDT) on Sunday 2 October 2022.
29 August 2022
Australian Foundation
Investment Company Limited
ABN 56 004 147 120
Level 21, 101 Collins St
Melbourne VIC 3000
T 03 9650 9911
F 03 9650 9100
invest
@
afi.com.au
afi.com.au
ABN 56 004 147 120
000001
000 1301011221012102012221332120133322113
SAM
MR JOHN SAMPLE
FLAT 123
SAMPLE STREET
SAMPLE STREET
SAMPLE STREET
SAMPLETOWN VIC 3030

288500_23_V5
Questions from shareholders
Shareholders will have a reasonable opportunity to ask questions at the AGM (including an
opportunity to ask questions of the Auditor) verbally or via the meeting platform.
As was the case last year, we also welcome shareholder questions in advance of the meeting.
These can be emailed to the Company at agm@afi.com.au or enclosed with your returned
Voting Form if you elect to return a hard copy.
Shareholders and guests who are unable to join us in person or virtually are able to listen to the
AGM. Please dial 1800 809 971 and state that you would like to join the Australian Foundation
Investment Company call. Please allow 10 minutes to join the call.
If it becomes necessary to adjust the arrangements for holding AFIC’s AGM, we will provide
shareholders with as much notice as possible. We encourage shareholders to monitor the ASX
website and the AFIC website at www.afi.com.au for any updates. For the health and safety
of all attendees, if you feel unwell or have any symptoms of COVID-19, we ask that you do not
attend the AGM in person, and instead join the AGM online. By attending the AGM in person you
are agreeing to abide by any health and safety rules issued by the venue or the Company.
On behalf of the Board, I thank you for your continuing support as a shareholder. We look forward
to welcoming you to our hybrid AGM either virtually or in person on 4 October 2022.
Yours sincerely
John Paterson
Chairman

Notice of Annual
General Meeting
2022
The Annual General Meeting of Australian
Foundation Investment Company Limited,
ABN: 56 004 147 120 (‘the Company’)
will be held at 10.00am (AEDT) on
Tuesday 4 October 2022

Australian Foundation Investment Company Limited

3Australian Foundation Investment Company LimitedNotice of Annual General Meeting 2022
The Annual General Meeting of Australian Foundation Investment Company Limited, ABN: 56 004 147 120 (‘the Company’)
will be held at 10.00am (AEDT) on Tuesday 4 October 2022 and will take place physically at the Clarendon Auditorium, Melbourne
Convention and Exhibition Centre (MCEC), 2 Clarendon Street, Southbank, Victoria, Australia and via an online platform at
meetnow.global/M566RZV.
Shareholders are requested to participate in the AGM in person, via our online AGM platform or via the appointment of a proxy.
Further information on how to participate virtually is set out in this Notice and the Online Meeting Guide.
The Company has determined that, for the purpose of voting at the meeting, shares will be taken to be held by those persons recorded
on the Company’s register at 7.00pm (AEDT) on Sunday 2 October 2022.
1. Financial Statements and Reports
To consider the Directors’ Report, Financial Statements and Independent Audit Report for the financial year ended 30 June 2022.
(Please note that no resolution will be required to be passed on this matter).
2. Adoption of Remuneration Report
To adopt the Remuneration Report for the financial year ending 30 June 2022.
To consider and, if thought fit, to pass the following resolution (as an ordinary resolution):
“That the Remuneration Report for the financial year ended 30 June 2022 be adopted.”
(Please note that the vote on this item is advisory only)
3. Re-election of Director
To consider and, if thought fit, to pass the following resolutions (as ordinary resolutions):
“That Rebecca Dee-Bradbury, a Director retiring from office in accordance with Rule 46 of the Constitution, being eligible is re-elected
as a Director of the Company.”
4. Amendments to the Constitution
To consider and, if thought fit, pass the following resolution as a special resolution:
“That for the purposes of Section 136(2) of the Corporations Act 2001 (Cth) and for all other purposes, the Constitution of the Company
be amended as set out in the document made available at afi.com.au/shareholders and signed by the Chair for the purposes
of identification, with effect from the close of this meeting.”
By Order of the Board

Matthew Rowe
Company Secretary
29 August 2022
BUSINESS OF THE MEETING

4Australian Foundation Investment Company LimitedNotice of Annual General Meeting 2022
The Explanatory Notes below provide
additional information regarding the items
of business proposed for the Annual
General Meeting.
IMPORTANT: Shareholders are urged
to direct their proxy how to vote by
clearly marking the relevant box for
each item on the proxy form.
Please ensure that your properly
completed proxy form reaches
the share registry by the deadline
of 10.00am (AEDT) on Sunday
2 October 2022.
Where permitted, the Chairman
of the meeting intends to vote
undirected proxies in favour
of all items of business.
1. Financial Statements
and Reports
During this item there will be a reasonable
opportunity for shareholders to ask
questions and comment on the Directors’
Report, Financial Statements and
Independent Audit Report for the financial
year ended 30 June 2022. No resolution
will be required to be passed on this
matter.
Shareholders who have not elected to
receive a hard copy of the Company’s
2022 Annual Report can view or
download it from the Company’s
website at:
afi.com.au/our-company
#Companyreports
2. Adoption of
Remuneration Report
During this item there will be a
reasonable opportunity for shareholders
at the meeting to comment on and ask
questions about the Remuneration Report
which can be found in the Company’s
2022 Annual Report.
As prescribed by the Corporations Act 2001,
the vote on the proposed resolution is an
advisory one.
Voting Exclusions on Item 2
Pursuant to Sections 250BD and 250R
of the Corporations Act 2001 (Cth),
votes may not be cast, and the Company
will disregard any votes cast, on the
resolution proposed in Item 2
(‘Resolution 2’):
• by or on behalf of any member
of the key management personnel
of the Company’s consolidated
group (a ‘KMP member’) whose
remuneration details are included in
the Remuneration Report or any of
their closely related parties; or
• as a proxy by a person who is a KMP
member at the date of the meeting or
any of their closely related parties,
unless the votes are cast:
• as a proxy for a person who is
entitled to vote on Resolution 2 in
accordance with a direction in the
proxy appointment; or
• by the Chairman of the Annual General
Meeting as a proxy for a person
who is entitled to vote on Resolution
2 in accordance with an express
authorisation in the proxy appointment
to cast the votes even though
Resolution 2 is connected directly
or indirectly with the remuneration
of a KMP member.
If the Chairman of the Annual General
Meeting is appointed, or taken to be
appointed, as a proxy, the shareholder
can direct the Chairman to vote for or
against, or to abstain from voting on,
Resolution 2 by marking the appropriate
box opposite Item 2 on the proxy form.
For the purposes of these voting
exclusions, a ‘closely related party’
of a KMP member means (1) a spouse
or child of the KMP member, (2) a child
of the KMP member’s spouse, (3) a
dependant of the KMP member or of
the KMP member’s spouse, (4) anyone
else who is one of the KMP member’s
family and may be expected to influence
the KMP member, or be influenced by
the KMP member, in the KMP member’s
dealings with the Company, or (5) a
company the KMP member controls.
The Company will also apply these
voting exclusions to persons appointed
as attorney by a shareholder to attend
and vote at the Annual General Meeting
under a power of attorney, as if they were
appointed as a proxy.
Pursuant to Sections 250BD(2) and
250R(5) of the Corporations Act 2001,
if the Chairman of the meeting is a proxy
and the relevant shareholder does not
mark any of the boxes opposite Item 2,
the relevant shareholder will be expressly
authorising the Chairman to exercise
the proxy in relation to Item 2.
Board recommendation: Noting
that each director has a personal
interest in their own remuneration
from the Company, as described in
the Remuneration Report, the Board
unanimously recommends that
shareholders vote IN FAVOUR
of this resolution.
EXPLANATORY NOTES

5Australian Foundation Investment Company LimitedNotice of Annual General Meeting 2022
3. Re-election of Director
Ms Rebecca Dee-Bradbury was elected
as a Director by shareholders at the 2019
AGM. As such she is required to seek
re-election by shareholders at this AGM.
Her biographical details are set out below:
Rebecca Dee-Bradbury
BBus, GAICD
Independent Non-Executive Director
Member of the Investment and
Nomination Committees
Ms Dee-Bradbury was previously Chief
Executive Officer/President of Developed
Markets (Asia Pacific and ANZ) for
Mondelez from 2010 to 2014. Before
joining Mondelez Ms Dee-Bradbury was
Group CEO of the global Barbeques
Galore group, and has held other senior
executive roles in organisations including
Maxxium, Burger King Corporation and
Lion Nathan/Pepsi Cola Bottlers.
Ms Dee-Bradbury is a Non-Executive
Director of BlueScope Steel Limited
(appointed April 2014), a Director of
Energy Australia Holdings following her
appointment in April 2017 and a member
of Chief Executive Women and of the
Women Corporate Directors Foundation.
Ms Dee-Bradbury was formerly a
Non-Executive Director of Grain Corp
Limited (from 2014 to 2020) and Tower
Limited (NZ) until her resignation in 2016
and a former member of the Federal
Government’s Asian Century Strategic
Advisory Board.
Board recommendation and
undirected proxies: The Board
(with Ms Dee-Bradbury abstaining)
recommends that shareholders vote
IN FAVOUR of this resolution, and
the Chairman of the meeting intends
to vote any undirected proxies IN
FAVOUR of this resolution.
Further information regarding the
Company’s Corporate Governance
arrangements and the Board’s role can
be found on the Company’s website at:
afi.com.au/corporate-governance
4. Amendments to
the Constitution
Overview
It is proposed that the Company’s
Constitution be amended to reflect
changes in law, regulation and market
practice since the Constitution was last
updated in 2012.

A marked up copy of the Company’s
Constitution showing the proposed
changes is available afi.com.au/
shareholders and copies are also
available for inspection until the close of
the AGM at the Company’s registered
office at Level 21, 101 Collins Street,
Melbourne VIC 3000.
A summary of the proposed changes
is set out below.
New Rule 2(f) – giving the ASX
Listing Rules priority in the event
of any conflict with the provisions
of the Company’s Constitution
Listed entities have the option of including
certain pro forma provisions (in the form
of the provisions set out in ASX Appendix
15B) in their constitution which are
intended to ensure that in the event of
any inconsistency between the entity’s
constitution and the ASX Listing Rules,
the ASX Listing Rules will prevail. A key
benefit of including these provisions in
the new Rule 2(f) is that the Company’s
Constitution will not require modification
to the extent a change to the ASX
Listing Rules in the future requires the
Constitution to contain or omit certain
provisions.
Rule 9 – updating the number
of joint holders that may be
registered from three to four
Currently, Rule 9(a) states that the
Company is not bound to register more
than three persons as the holders of
shares. In April 2021, ASX announced
the replacement of the existing
CHESS clearing system with CHESS
Replacement which, broadly speaking,
seeks to provide issuers and investors
with greater control over, and enhanced
confidence in, market activities through
timely, secure and simplified access
to the register of holders (for issuers),
financial assets (for investors) and
associated information. The change to
Rule 9(a) from three to four joint holders
has been proposed to address that
CHESS Replacement will allow up
to four joint holders of a security.
CHESS Replacement was scheduled for
implementation in April 2023 but the ASX
has announced that this date is no longer
feasible. The revised implementation
date is expected be determined by ASX
after further consultation with relevant
stakeholders.
New Rule 20A – payments that
are required by the Company
The proposed new Rule 20A seeks to
clarify that where a taxation authority
or government requires the Company
to make a payment on behalf of any
holder of the Company’s shares (for
example, this would cover payments
such as withholding taxes) this money
is recoverable by the Company from
the particular shareholder (or their legal
representatives). The Company is also,
at its discretion, able to charge interest
on these amounts in order to ensure that
the shareholders as a whole are not left
worse off as a result of these payments.
Provisions such as Rule 20A are
commonly included in modern
constitutions and bolster any statutory
or other legal rights that the Company
has to recover such monies in these
circumstances.

6Australian Foundation Investment Company LimitedNotice of Annual General Meeting 2022
Rule 37 – updating the provisions
relating to voting at General
Meetings
Following amendments to the Corporations
Act made by the Corporations Amendment
(Meetings and Documents) Act 2022 (Cth),
resolutions in the notice of meeting of
listed entities must be considered by a
poll rather than a show of hands. The
ASX also requires that all Listing Rule
resolutions be conducted by way of
poll rather than by a show of hands.
The amendments to Rule 37 reflect
these changes.
Rule 37(b) has been retained because
despite the default position being
that every substantive resolution will
need to be put to a poll there may be
situations where calling a poll will involve
unnecessary additional administration
and a show of hands should be used
if a poll is not required.
Rules 45 and 48 – Director eligibility
requirements
The Company is required to comply with
various laws, regulations and standards.
Some of these laws can require the
Company’s directors to satisfy certain
requirements (for example, Australia’s
financial services licensing laws require a
financial services licensee’s responsible
officers to satisfy a good fame and
character requirement).
The proposed amendments to Rule
45 and Rule 48 (and in the inclusion
of the definition of ‘relevant Director
Requirements’ in Rule 1) will:
• require any nominated director to
satisfy, and the existing directors
to continue to satisfy, any eligibility
requirements prescribed by law,
regulations or standards; and
• require any nominated director
or existing director to provide all
information and consents that the
Board reasonably requests to enable
the Board to determine if the person is
eligible to become or remain a director
under the requirements prescribed
by Australian law, regulations or
standards.
The effect of these proposed changes
is that a person will not be able to
be nominated for consideration as a
Director if they are not eligible under the
relevant regulatory requirements or the
person does not provide the necessary
information to the Company to enable
the Board to determine if the person is
eligible under the relevant regulatory
requirements.
The Board consider that these proposed
amendments are necessary to strengthen
the process for ensuring that any
proposed or existing directors of the
Company are eligible to hold office
under the relevant laws, regulations
and standards at any point in time.
Importantly, the proposed amendments
would only impose eligibility requirements
on directors if the relevant laws, regulations
and standards required them.
Rule 72 – updating the notice
provisions, including the use
of electronic notices
The suggested changes to Rule 72
facilitate the use of electronic notices and
offers to shareholders. They enable:
• notices and offers of securities to be
sent via electronic means;
• notices and offers of securities to refer
to an electronic address that contains
the primary notice, documents or
attachments;
• notices and offers of securities to
shareholders outside of Australia to be
sent or made available electronically;
and
• notices and offers to be deemed
to be delivered in the event that the
shareholder does not have a registered
address.
These suggested changes are facilitative
and will provide the Company with
greater flexibility in communicating with
shareholders. Importantly, they do not
mandate electronic communication
with shareholders – but, rather, allow for
greater flexibility in the manner in which
notices and documents may be provided
electronically where a shareholder agrees
to the use of electronic communications.
EXPLANATORY NOTES
continued

7Australian Foundation Investment Company LimitedNotice of Annual General Meeting 2022
Miscellaneous changes
In the course of undertaking its review
of the Constitution, the Board has
also identified a number of minor and
technical matters that would benefit
from amendment. These proposed
amendments are summarised below.
• Rule 1 (Definitions) – a number of
amendments to definitions in Rule 1
have been proposed as follows:
– The definition of ‘Shareholder
Present’ to clarify that shareholders
attending a meeting via virtual
meeting technology are considered
to be present at the meeting.
– Updating the definitions of ‘ASTC’
and ‘ASTC Settlement Rules’
to reflect their current names.
– Including a definition for ‘Direct Vote’.
• Rule 9(f)(Direct Votes) – amendments
to clarify the administration of Direct
Votes in the context of joint holders in a
manner consistent with voting in person
or by proxy, authorised representative
or attorney.
• Rules 33, 34, 35, 36, 37, 39, 40, 57
and 58 (references to chair of the
meeting) – a number of technical
drafting edits to these Rules to correct
references from the ‘Chair’ to the
‘chair of the meeting’.
• Rule 43 (Proxies) – amendments
to provide greater flexibility for the
Company to deal with incomplete proxy
forms, and to deal with the electronic
lodgement of proxy appointments.
• Rule 55 (Convening Board meetings)
– amendments to clarify that any
director may convene a meeting of the
Board (and that the Secretary must
convene a meeting of the Board when
requested to do so by any Director).
• Rule 69 (Distributions in kind) –
amendments to clarify the types of
distributions that can be made in order
to allow greater flexibility in the event
that particular assets need to be sold
or securities in another corporation
need to be transferred to the Company’s
shareholders as part of any dividend
or other distribution.
• Rule 78 (Restricted Securities) –
amendments to Rule 78 reflect the
provisions required to be included in
an entity’s constitution by amendments
to ASX Listing Rule 15.12 that
came into effect on 1 December
2019. Restricted securities include
categories of securities that ordinarily
are subject to ASX’s mandatory
escrow requirements by reference
to the circumstances in which they
were issued (e.g. securities may
be restricted securities if they were
issued to a related party, promoter,
seed capitalist, vendor or professional
adviser or consultant for cash, or as
consideration for the sale of classified
assets or for services rendered). ASX
also has discretion to designate other
securities as restricted securities.
• Other – a number of consequential
drafting amendments flowing from
the above changes and other minor
clarifications and corrections.
Board recommendation and undirected
proxies: The Board recommends that
shareholders vote IN FAVOUR of this
resolution, and the Chairman of the
meeting intends to vote any undirected
proxies IN FAVOUR of this resolution.

8Australian Foundation Investment Company LimitedNotice of Annual General Meeting 2022
SHAREHOLDER INFORMATION
Shareholders and Proxyholders have two options for participating at the AGM:
In person
Online via the Computershare Meeting Platform (access via meetnow.global/M566RZV)
In Person
The AGM will be held at the Clarendon Auditorium, Melbourne Convention and Exhibition Centre (MCEC),
2 Clarendon Street, Southbank, Victoria, Australia.
If it becomes necessary to make further arrangements for holding AFIC’s AGM, we will provide shareholders with as much notice as
possible in the circumstances. However, we encourage shareholders to monitor the ASX website and the AFIC website at afi.com.au
for any updates. For the health and safety of all attendees, if you feel unwell or have any symptoms of COVID-19, we ask that you do
not attend the AGM in person, and instead join the AGM online.
Yarra River
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Siddeley Street Car Park
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Car Park
Entry
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Car Park
Exit
P
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Loading Dock
Entry/Exit
Loading Dock
Entry
Loading
Dock Exit
Wright Walk
Dukes Walk
Orrs Walk
Rona Walk
Orrs Walk
DFO Homemaker
Pan Pacific Hotel
South Wharf Promenade
Polly Woodside
DFO
Wilson Parking
South Wharf
Novotel
Hotel
Link to
Novotel Hotel
Normanby Road
Wurundjeri Way
Convention Centre Place
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Plenary
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2
Plenary
1
Stage
101
102
103
104
105
106
107
108
109
110
111
112
SP101
O101
Stair 1
Stair 2
Stair 3
Door 16
Door 15
Door 14
Door 13
Door 12
Door 11
Kiosk D
Link to
Pan Pacific
Hotel
H6
H7
H8
Door 20
Door 21
VIP Suites
1
2
O9
Terrace
Sovereign
Room
MCEC
Level One
Convention Centre
Place Entrance
Clarendon Street
Entrance
Enter Here
Convention Centre
Exhibition Centre
Doors 11–21
Exhibition Centre
Doors 1–10
MEC Basement Car Park
Parking
P
Ride Share
RS
Bike Route
Bike Parking
Tram Line
Taxis
Buses/Skybus
Polly Woodside
Boardroom
Business Centre
O1
Organiser Office
H1
Hospitality Suites
SP1
Speaker Prep Room
Showers
First Aid
Prayer Room
Accessible Toilet
Male Toilet
Female Toilet
Parents Room
Cafe
Cloak Room
Cutomer Service
Kiosk
Security
Escalator
Lifts
Stairs
Entry/Exit
Transfer Points
Clarendon
Auditorium
Clarendon Auditorium
Directional Map

9Australian Foundation Investment Company LimitedNotice of Annual General Meeting 2022
Via the Online Platform
If shareholders are attending on line they
must use the Computershare Meeting
Platform to participate in the meeting.
To participate in the meeting, you can
log in by entering the following URL
meetnow.global/M566RZV on your
computer, tablet or smartphone.
Online registration will open
1 hour before the meeting.
To make the registration process
quicker, please have your SRN/HIN and
registered postcode or country code
ready. Proxyholders will need to contact
Computershare prior to the meeting to
obtain their login details.
To participate in the meeting online follow
the instructions below.
1. Click on ‘Join Meeting Now’.
2. Enter your SRN/HIN. Proxyholders will
need to contact Computershare on
+61 3 9415 4024 one hour prior to the
meeting to obtain their login details.
3. Enter your postcode registered to
your holding if you are an Australian
securityholder. If you are an overseas
securityholder select the country
of your registered holding from
the drop-down list.
4. Accept the Terms and Conditions
and ‘Click Continue’.
Online Meeting Guide:
www.computershare.com.au/
virtualmeetingguide
A detailed guide on how to participate
virtually is set out in the Online Meeting
Guide (computershare.com.au/
virtualmeetingguide) or on our website
at afi.com.au. This Guide explains
how you can ensure your browser is
compatible with the online platform,
as well as a step-by-step guide to
successfully log in and navigate the site.
Voting Options for the AGM
• Voting in person at the meeting
• Direct voting via the online AGM
platform during the AGM
• Appointing a proxy
All Resolutions Will be by Poll
As some shareholders may participate
virtually in the Meeting each resolution
considered at the Meeting will be
conducted by a poll. The Board considers
voting by poll to be in the interests of the
shareholders as a whole and ensures
the views of as many shareholders as
possible are represented at the Meeting.
Direct Voting Via Online AGM
Platform – During the AGM
In accordance the Company’s
Constitution (‘Constitution’), the Directors
have determined that at the AGM, a
shareholder who is entitled to vote on
a resolution at the AGM is entitled to a
direct vote in respect of that resolution
and have approved the use the online
AGM platform as the means by which
shareholders can deliver their direct
vote in real time during the AGM.
Shareholders can participate in the
AGM via the Computershare Meeting
Platform and will be able to vote directly
through the online platform in real time.
Shareholders and proxyholders can vote
directly online at any time between the
start of the AGM at 10.00am (AEDT) and
the closure of voting as announced by the
Chairman during the Meeting.
More information regarding direct voting
during the AGM is detailed in the Online
Meeting Guide available on our website
afi.com.au.
Listening to the AGM
Via Telephone
Shareholders and guests who are
unable to join us in person or virtually
are able to listen to the AGM. Please
dial 1800 809 971 and state that you
would like to join the Australian
Foundation Investment Company call.
Please allow 10 minutes to join the call.

10Australian Foundation Investment Company LimitedNotice of Annual General Meeting 2022
Proxies
If you cannot attend the meeting online at
the scheduled time, you can participate in
the AGM by appointing a proxy to attend
and vote at the AGM. Shareholders can
appoint a proxy on the enclosed Proxy
Form, instructions on how to lodge the
Proxy Form are contained in the attached
Notice of Meeting.
1. A shareholder entitled to attend
and vote at this meeting is entitled
to appoint not more than two proxies
(who need not be members of the
Company) to attend, vote and speak
in the shareholder’s place and to join
in any demand for a poll.
2. A shareholder who appoints two
proxies may specify a proportion or
number of the shareholder’s votes
each proxy is appointed to exercise.
Where no such specification is made,
each proxy may exercise half of the
votes (any fractions of votes resulting
from this are disregarded).
3. Proxy forms may be lodged online
by visiting investorvote.com.au or
by scanning the QR Code on the
proxy form with a mobile device.
4. Relevant custodians may lodge
their proxy forms online by visiting
intermediaryonline.com
5. Proxy forms and any authorities (or
certified copies of those authorities)
under which they are signed may be
also delivered, by mail or by fax to the
Company’s Share Registry (see details
below) no later than 48 hours before
the meeting, being 10.00am (AEDT)
on Sunday 2 October 2022. Further
details are on the proxy form.
6. A proxy need not vote in that capacity
on a poll (unless the proxy is the
Chairman of the meeting). However, if
the proxy’s appointment specifies the
way to vote on a resolution, and the
proxy decides to vote in that capacity
on that resolution, the proxy must vote
the way specified (subject to the other
provisions of this Notice, including the
voting exclusions noted above).
7. In certain circumstances the Chairman
of the meeting will be taken to have
been appointed as the proxy of the
relevant shareholder in respect of the
meeting or the poll on that resolution
even if the shareholder has not
expressly appointed the Chairman
of the meeting as their proxy. This
will occur where:
• an appointment of a proxy specifies
the way the proxy is to vote on
a particular resolution; and
• the appointed proxy is not the
Chairman of the meeting; and
• at the meeting, a poll is called
on the resolution; and
• either of the following apply:
– if a record of attendance is made
for the AGM and the proxy is not
recorded as attending
– the proxy does not vote on
the resolution.
Corporate Representatives
A body corporate which is a shareholder,
or which has been appointed as a proxy,
may appoint an individual to act as its
representative at the meeting. Evidence
of the appointment of a corporate
representative must comply with
Section 250D of the Corporations Act 2001
and be lodged with the Company before
the AGM.
Attorneys
A shareholder may appoint an attorney
to vote on their behalf. To be effective
for the meeting, the instrument effecting
the appointment (or a certified copy of it)
must be received by the deadline for the
receipt of proxy forms (see above), being
no later than 48 hours before the meeting.
Questions from Shareholders
Shareholders who are unable to attend
the meeting or who prefer to register
questions in advance are invited
to use the question form included
with their proxy form or via email
agm@afi.com.au. The deadline for
receipt of questions by email to be
considered at the AGM is 20 September
2022. During the course of the meeting,
the Chairman will endeavour to address
the themes most frequently raised in the
submitted question forms. Please note
that individual responses will not be
sent to shareholders.
You may also submit questions and
comments during the AGM in real time
via the online platform. Please note,
only shareholders may ask questions
online. More information regarding asking
questions during the AGM is detailed in
the Online Meeting Guide available on
our website afi.com.au.
SHAREHOLDER INFORMATION
continued

11Australian Foundation Investment Company LimitedNotice of Annual General Meeting 2022
Share Registry
The Company’s Share Registry details
are as follows:
Computershare Investor
Services Pty Limited
Street Address
Yarra Falls
452 Johnston Street
Abbotsford VIC 3067
Postal Address
GPO Box 242
Melbourne VIC 3001
Telephone
1300 662 270 (within Australia)
0800 333 501 (within New Zealand)
+61 3 9415 4373 (outside Australia)
Facsimile
1800 783 447 (within Australia)
+61 3 9473 2555 (outside Australia)
Internet
investorcentre.com/contact

288500_17_V3

ABN 56 004 147 120
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1300 662 270 (within Australia)
+61 3 9415 4373 (outside Australia)
All your securities will be voted in accordance with your directions. Each resolution considered
at the meeting will be conducted by a poll.

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Sunday 2 October 2022
You may elect to receive meeting-related
documents, or request a particular one, in
electronic or physical form and may elect
not to receive annual reports. To do so,
contact Computershare.
PARTICIPATING IN THE MEETING
Corporate Representative
If a representative of a corporate securityholder or proxy is to participate in the
meeting you will need to provide the appropriate “Appointment of Corporate
Representative”. A form may be obtained from Computershare or online at
www.investorcentre.com under the help tab, “Printable Forms”.
XX

651+,1,
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*S00000112Q01*

288500_17_V3
I/We being a shareholder/s of AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED hereby appoint
the Chairman
of the meeting
OR
or failing the individual or body corporate named in relation to the meeting generally or in relation to a poll on a given resolution, or if no individual
or body corporate is named, the Chairman of the meeting, as my/our proxy to act generally at the meeting or in relation to a poll on the given
resolution (as applicable) on my/our behalf, including to vote in accordance with the following directions (or if no directions have been given, and
to the extent permitted by law, as the proxy sees fi t), at the Annual General Meeting of Australian Foundation Investment Company
Limited
that will be held at the Clarendon Auditorium, Melbourne Convention and Exhibition Centre (MCEC), 2 Clarendon Street,
Southbank Victoria and via an online platform at 10.00am (AEDT) on Tuesday 4 October 2022
and at any adjournment or
postponement of that meeting.
Chairman to vote undirected proxies as follows: I/We acknowledge that the Chairman of the meeting intends to vote undirected proxies
in favour of each item of business, to the extent permitted by law.
Chairman authorised to exercise proxies on remuneration related matters: If I/we have appointed the Chairman of the meeting as my/our
proxy (or the Chairman of the meeting becomes my/our proxy by default), I/we expressly authorise the Chairman of the meeting, to the extent
permitted by law, to exercise my/our proxy in respect of item 2 even though item 2 is connected directly or indirectly with the remuneration of a
member of key management personnel of Australian Foundation Investment Company Limited and its consolidated group, which includes the
Chairman of the meeting.
Items of Business
STEP 2
PLEASE NOTE: If you mark the Abstain box for an item, you are directing your proxy not to vote on your
behalf on a poll and your votes will not be counted in computing the required majority
Appoint a proxy to vote on your behalf
Signature of Shareholder(s) This section must be completed.
SIGN
STEP 1
PLEASE NOTE: Leave this box blank if
you have selected the Chairman of the
meeting. Do not insert your own name(s).
Individual or Shareholder 1
Sole Director and Sole Company Secretary
Shareholder 2
Director
Shareholder 3
Director/Company Secretary
Contact
Name
Contact
Daytime
Telephone
Date
/ /
Please mark to indicate your directions
Proxy Form
Change of address. If incorrect,
mark this box and make the correction
in the space to the left. Shareholders
sponsored by a broker (reference
number commences with ’X’) should
advise their broker of any changes.
AFI288500A
For
Against
Abstain
Item 2Adoption of Remuneration Report
Item 3Re-election of Director - Ms Rebecca Dee-Bradbury
Item 4Amendments to the Constitution
The Chairman of the Meeting intends to vote undirected proxies in favour of each item of business, to the extent permitted by law. In exceptional
circumstances, the Chairman of the Meeting my change his/her voting intention on any resolution, in which case an ASX announcement will be
made.
I 9999999999 I N D
XX
MR JOHN SAMPLE
FLAT 123
123 SAMPLE STREET
THE SAMPLE HILL
SAMPLE ESTATE
SAMPLEVILLE VIC 3030
*I1234567890*

AFI
Questions from Shareholders

Question(s): Please mark X if it is a question directed to the auditor

1 ___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
__________________________________________________________________________________________________
__________________________________________________________________________________________________
2 ___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
__________________________________________________________________________________________________
__________________________________________________________________________________________________
3 ___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
__________________________________________________________________________________________________
__________________________________________________________________________________________________
4 ___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
__________________________________________________________________________________________________
__________________________________________________________________________________________________
All correspondence to:
AFI Share Registrar
Computershare Investor Services Pty Limited
GPO Box 242
Melbourne Victoria 3001
Australia
288500_21_V2
The Annual General Meeting (AGM) of Australian Foundation Investment Company Limited will be held at the Clarendon Auditorium,
Melbourne Convention and Exhibition Centre (MCEC), 2 Clarendon Street, Southbank Victoria and via an online platform at
10.00am (AEDT) on Tuesday 4 October 2022. Shareholders who are unable to attend the meeting, or who prefer to register
questions in advance, are invited to submit any questions they have by completing and returning this form.
Please return your completed question form to our Share Registrar, Computershare Investor Services Pty Limited, GPO Box 242,
Melbourne VIC 3001, or by facsimile to 1800 783 447 (outside Australia +61 3 9473 2555) by Tuesday 20 September 2022.
The envelope provided for the return of your proxy form may also be used for this purpose.
You may also submit written questions to the auditor if the questions are relevant to the content of the auditor’s report or the conduct
of the audit of the fi nancial statements to be considered at the AGM.
We will endeavour, during the course of the AGM, to address the themes most frequently raised in the submitted question forms.
Please note that individual responses will not be sent to shareholders.
ABN 56 004 147 120

ASX Dividend Form containing DRP/DSSP price and FX rates Appendix 3Y – Change of Director’s Interest Notice x5

Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.