DISCLOSURE STATEMENT

Name:

John Hyde

In accordance with the provisions of the Securities Markets Act 1988 and the Securities Markets (Investment Advisers and Brokers) Regulations 2007 this Disclosure Statement provides you with information and answers to questions about me. It provides details about:

• the services I can provide;
• how I operate my business;
• my qualifications as an investment adviser;
• what investment products I am able to sell you;
• which financial organisations I am able to place business with; and
• how I am remunerated.

This document was prepared on 29 Feb 2008.

Employer:	Costello Financial Services Ltd
Address:	129d Onewa Rd, Northcote P O Box 34778, Birkenhead Auckland
Phone:	09 4808308
Fax: Email:	09 4808319 info@costello.co.nz

EXPERIENCE

I have been an investment adviser for 13 years and give advice on savings and investment products provided by selected Bank, Insurance and Investment companies.

I also provide relevant advice on Insurance and Mortgage products.

QUALIFICATIONS

Relevant qualifications include:

I keep my qualifications up-to-date by regularly:

I maintain a record of the above.

When we give advice we follow the internationally recognised six-step process:

1. Establishing the client-adviser relationship,
2. Gathering client data and determining your goals and expectations,
3. Analysing and evaluating the client's financial position, cash and debt management, personal and business insurance, retirement planning, and/or investment needs,
4. Developing and presenting our written advice,
5. Overseeing the implementation of the plan, and
6. Monitoring and reviewing the plan.

This can require a series of meetings with a prospective client before our advice is finalised. We also maintain an ongoing relationship with clients, regularly reviewing progress and working with them over time to ensure their goals can be met.

The services we provide will depend on your needs. They may include any or all of those detailed in this Disclosure Statement.

Our advice will take account of your personal objectives, financial situation and needs. It will be clear and concise, with enough detail for you to make an informed decision about whether to act on it.

I am a member of the Institute of Financial Advisers and, as a condition of my membership I adhere to the IFA Code of Ethics and IFA Practice Standards in all facets of my practice.

In compliance with the Institute of Financial Advisers Code of Ethics, I have professional indemnity insurance which covers all my areas of practice as listed above.

This insurance provides protection for clients for:

• any error or omission;
• defamation;
• employee dishonesty; and
• includes full "prior acts" protection.

The minimum level of cover is in compliance with Institute of Financial Adviser's Membership By-laws.

The underwriter is Lumley General Insurance.

As with all insurance, this cover has limitations and is subject to certain exclusions and terms and conditions.

In the first instance you can direct any complaints to the product supplier company involved, as each of them has an internal complaints handling process.

Any customer who has a complaint should also contact us. We will immediately investigate and, where justified, make our best endeavors to correct.

Should the complaint not be resolved satisfactorily, a complaints procedure is available through the IFA, by telephoning 0800 40 44 22 or by writing to:

National Office,
IFA,
PO Box 5513,
Wellington.
www.ifa.org.nz

Should the customer still seek a review, then the complaint should be addressed to the:

Insurance Ombudsman
P.O. Box 10-845,
Wellington:
Tel 04 4997612 or Fax 04 4997614.
www.iombudsman.org.nz

DISCLOSURE OF CERTAIN CRIMINAL CONVICTIONS

No principal officer of Costello Financial Services Ltd has, within the last five years, been:

• convicted of an offence under the Securities Markets Act 1988; the Investment Advisers (Disclosure) Act 1996 or the Securities Act 1978, or for a crime involving dishonesty;
• a director or principal officer of a body corporate that has committed an offence against the Securities Markets Act 1988, the Investment Advisers (Disclosure Act) 1996 or the Securities Act 1978 or for a crime involving dishonesty;
• adjudged bankrupt;
• prohibited by an Act or by a court from taking part in the management of a company or business;
• the subject of an adverse finding by a court in any proceeding taken against me in my professional capacity; or
• expelled from, or prohibited from being a member of, a professional body.

Costello Financial Services Ltd has not, within the last thirty seven years, been placed in statutory management or receivership.

The fees you will have to pay me and Costello Financial Services Ltd are set out in the schedule below.

OTHER INTERESTS AND RELATIONSHIPS

SovNet is an association of like minded professional financial advisers who have chosen to form a business relationship with Sovereign, a market leading insurance and investment services provider. The relationship is in respect to risk and contractual savings business.

My membership of SovNet provides me with advantages such as advance product training, professional development, participation in peer group forums and industry information. These advantages allow me to better serve my clients and their unique needs.

Being a member of SovNet obliges me to place the majority of my customers risk and contractual savings business with Sovereign. However, it is not an exclusive arrangement and I am entitled to place a significant portion of my business with any provider of my choosing.

I and other Costello Financial Services Ltd associates also place business with the providers listed below:

also have relationships with:

The nature and extent of our relationship with each of these organisations is as an appointed Adviser for their Investment and other financial products as described above.

I am associated with the following persons: Bryan Costello, Kevin Orrell, Terry Kim, and Connie Li

The nature and extent of my relationship with these persons is that of associates. My associate(s) also have relationships with the above list of organisations.

Neither I nor an associate has any other financial or other relationship with any other person that would be reasonably likely to influence me in giving advice, except as described above.

I provide advice in the following subject areas:

Cash/Debt Management - relevant to mortgage planning

Risk Management - relevant to Personal or Business Insurance

Investment Advice - relevant to savings, investments and KiwiSaver

Mortgage Advice - relevant to Home or Commercial loans

I only give advice in the particular subject areas set out above.

I do not charge you a fee for the advice I provide.

I, my associates and/or Costello Financial Services Ltd will or may receive remuneration from the following sources:

• a commission paid by the above Providers to us following business placed with them,
• and/or an annual servicing fee for in force policies.

Sale of Insurance, Savings or Mortgage Products may also be used by the Providers to calculate other possible rewards and incentives.

Maximum Adviser commissions for Sovereign Investment products and services that are open to new business are set out below.

Up to $50 per plan completed.

Select Wealth Management

Portfolios	Entry Fee	On-going Trail (per annum)
Selected Income Generator	Up to 5%	Up to 0.50% pa
Selected Conservative Growth	Up to 5%	Up to 0.75% pa
Selected Balanced Growth	Up to 5%	Up to 0.75% pa
Selected Active Growth	Up to 5%	Up to 0.75% pa
Custom-Built	Up to 5%	Up to 1.00% pa

Other Investment products may be offered and fees will be disclosed per event.

Each Costello Financial Services adviser will set fees based on the above, or part thereof , based on time involved, and complexity of each product and/or service provided. All advisers will disclose actual entry fees and ongoing trails for each product offered prior to completing applications.

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