Annual Report2014 - 2015

Navigating. Together.

To our Clients and Friends:

Welcome to the 2015 FIA client conference! We are delighted by the number of clients and professional partners who have traveled from around the country to participate in our annual event. As we reflect on the past year, we are pleased with the progress we have made on behalf of our clients, humbled by the outside recognition we have garnered from industry peers, and proud of the incredible group of associates we have attracted to our firm. However, as humility is one of our firm’s core values, we are also cognizant of the fact that we must continue to improve in all areas in order to continually earn your business and trust. This fact is constantly communicated to all of our associates.

The firm’s mission statement guides us “to assist clients in achieving their investment objectives while fulfilling their fiduciary obligations.” However, we realize that for most clients our service model goes well beyond simply providing investment advice. We pride ourselves on being a trusted advisor in helping both our business and private wealth clients achieve their broader strategic objectives.

In 2014, we made a big commitment to technology at the firm. We feel this significant investment in a new CRM system will enhance our ability to service clients and meet their needs more quickly and efficiently, while providing increased privacy and security. By being more efficient, it will allow us to spend more time thinking creatively and being more proactive in anticipating our clients’ future needs and objectives.

We greatly expanded our Wealth Advisory Services team in 2014, hiring senior professionals and investing a great deal in the FIA private client experience. Please see our page dedicated to Wealth Advisory Services in this Annual Report.

Partnering with the other professionals who work with our clients has always been a hallmark of the culture of FIA. We want to thank those professionals – benefit attorneys, CPAs, and actuaries – for your trust in us when referring us to your clients. Last year we received more referrals from our professional partners than in any previous year, and we partnered with them on numerous education efforts, including webinars, seminars and publications. We are committed to remaining one of the thought leaders in the industry.

Our firm has always been deeply invested in the communities in which we live and work. Our consultants volunteer on non-profit boards and committees. The FIA Community Service Committee was extremely active this year, and some of their achievements are outlined in the pages to follow. We are so proud of our associates who started this committee on their own, meet on a monthly basis, and have generously given their time and money to so many worthwhile organizations. We hope you enjoy the pictures and stories on the pages related to their efforts.

FIA’s value is not in bricks and mortar. We do not produce widgets or consumer products. Our value is in our intellectual talent and capital. That intellectual capital resides with our partners and associates. We know that we need to continue to attract and retain quality associates. They drive the client experience and, thus, determine the firm’s reputation and future. We have hired many bright and talented individuals over the past year, as well as promoted numerous associates. Those announcements are in the pages that follow.

Last year we wrote that “culture is an overused word.” While that still is true today, we find it difficult not to write an annual letter without identifying FIA’s culture as a key differentiating factor in our success as a firm going forward. Our employees like working at FIA, as evidenced by the firm receiving the Best Places to Work in CT Award for the fifth year in a row. But it goes beyond that. Our culture is one of a ‘can do’ spirit, in other words, accomplishing whatever is necessary to assist our clients and get the job done. Community, charity, and mutual respect are not just words at FIA. They are part of the fabric of our organization. We will not compromise the culture of FIA and will continue to attract associates who have a passion for helping clients and giving back to the community and who embrace our collaborative environment.

Thank you for your trust and support.

Mark Wetzel Michael Goss Christopher Kachmar, CFA President Executive Vice President Chief Investment Officer

Maureen Cooper Ryan Gardner, PRP Karen Paulson, CIMA, PRPChief Compliance Officer Principal & Senior Consultant Principal & Senior Consultant

Christopher Rowlins, AIF® Anthony Tranghese, CFA Principal & Senior Consultant Principal & Senior Consultant

Our mission is to provide customized consulting services to assist our clients in achieving their investment objectives

while fulfilling their fiduciary obligations.

Our Leadership Team

OUR GROWING TEAM – PLEASE WELCOME OUR NEWEST EMPLOYEES!

Scott Boulton Kim Collins Oakley Duryea Associate Research Associate Research Research AnalystAnalyst Analyst

Nathan Elkin Matt Fratini Mary Legg, CEBS Associate Research Associate Research Financial EducatorAnalyst Analyst

Sean McCaffery Lindsay Mermell Andrew Salak Marketing Associate Client Service & Associate Director, Research Analyst Wealth Advisory Services

Pictured clockwise from top left are Chris Ledwith, Devon Francis, Maureen Cooper, Allie Cooper, Lindsay

Mermell & Laura Gineo.

2014 RUN FOR THE WOODS

HANDS ON HARTFORD FOOD DRIVE

As part of an ongoing food drive for Hands on Hartford, FIA is proud to have donated over 300 pounds of food to the organization. Pictured below are Sean McCaffery, Scott Boulton, Kelly McGuinness & Janet Ramos.

FIA was ranked #6 in the Best Places to Work in Connecticut, Small/Medium Company Category. This year marks the fifth consecutive year that FIA has been chosen by the program, which identifies and recognizes Connecticut’s best employers.

FIA team members enjoy participating in this annual trail running event, held by the Connecticut Forest & Park Association. The run is held each year to raise funds to help protect and maintain the Blue-Blazed Hiking Trails.

ST. JUDE GIVE THANKS. WALK.We braved a cold November 2014 morning to participate in the St. Jude walk to end childhood cancer, which took place in different communities across the country.

FIA team members celebrate at the 10th Annual Best Places to Work in CT Gala.

WEALTH ADVISORY SERVICES

FIA’s independent, customized approach to investment consulting is well suited to meet the needs of families intent on protecting and increasing wealth for the benefit of multiple generations.

Our Approach• Understand your unique goals, objectives,

and circumstances• Consider tax implications and risk tolerance• Capitalize on our access to managers and

asset classes• Monitor performance against your goals and

objectives• Educate family members about investing to

provide peace of mind

The Results• Seamless onboarding by a dedicated service

team• Strategic asset allocation with tactical

adjustments• Fully invested and diversified portfolios• A transparent relationship build on trust• Assurance that you are on track and meeting

objectives• Achieving life goals and preserving your

legacy through customized solutions

In an effort to expand its institutional research and investment strategies to individuals, Fiduciary Investment Advisors, LLC (“FIA”) has hired Andrew Salak as Associate Director of Wealth Advisory Services. In this role, Andrew will focus on wealth management, financial planning and client relations for private clients.

Andrew has been in the financial services industry for nearly ten years, spending the last five years at Morgan Stanley as a Financial Advisor in their wealth management division. While there, he was integral in improving and streamlining the service model for his team’s private client base.

PARTICIPANT EDUCATION SERVICESFiduciary Investment Advisors has taken steps to enhance its employee communication and education services within its growing defined contribution business.

In an effort to continue to provide focused consulting services to their expanding client base, Fiduciary Investment Advisors, LLC (“FIA”) has hired Mary Legg, CEBS as a Financial Educator. Mary has been in the employee benefits arena as a human resource executive at both public and private companies.

In this role, Mary will provide a unique perspective on participant communication and education. She will help to redesign all of FIA’s programs and materials in this area and help enhance FIA’s offering in the participant services space.

SUCCESS™

RetirementSimpleUnbiasedCustomizedCommunicationsEducation &SupportServices

One-size-does-not-fit-all when it comes to your employees’ education!

Plan Design & Management

Participant Education

Plan Investments

Every year the employees of FIA spend a day giving back to the community. In 2014, FIA’s Community Service Day was held at the Channel 3 Kids Camp in Andover, CT. The camp’s mission is to provide fun year-round opportunities to children of all abilities, families, & communities through educational & recreational programs that promote diversity, acceptance and environmental appreciation. The Camp is entering its 104th year of serving children! FIA employees spent the day at the camp cleaning the grounds and working around the facility.

Annual Community Service DayChannel 3 Kids Camp

Mark Wetzel, President, was the Conference Chair of the P&I Hospital & Healthcare Investing Summit in Chicago on October 14th and 15th. Kevin O’Brien, CFA, Consultant, served as a moderator on several panels at the conference. The event brought together top decision-makers – tasked with addressing concerns over financial constraints and pensions at healthcare systems and hospitals – to discuss solutions to the daily challenges they are facing.

Visit www.fiallc.com to view an interview from the Summit with FIA’s Kevin O’Brien, Consultant.

FIA Sponsors the Third Season of Freshly Squeezed with Colin McEnroe

Presented by Watkinson School

For the third consecutive year, FIA sponsored the Watkinson School’s Freshly Squeezed with Colin McEnroe series. All profits from ticket sales benefitted the education programs of Hartford institutions Billings Forge, Hartford Stage and the Mark Twain House.

Fiduciary Investment Advisors Executive Vice President Mike Goss adds, “We are thrilled to be the sponsor of this inventive series masterminded by Colin McEnroe. In addition to evenings filled with stimulating and thought provoking conversation, proceeds from these events benefit three important Hartford institutions, which is consistent with FIA's community involvement initiatives."

FIA has been participating in the Hartford Marathon since 2002. We are proud to have raised over $175,000 for Connecticut Children’s Medical Center through our participation. In 2014, FIA had representation in the full marathon, half marathon, and relay races.

Pictured above, left to right, are Brandyn & Cindy Vitek, Allie Cooper, Jen Chase, Rob Lowry, Devon

Francis & Elizabeth Gillespie.

2014 Hartford Marathon

PRINCESS AND THE PROM

For our 1st quarter community service project, we held an in-office fundraiser and dress collection drive to support Princess & the Prom.

Princess & the Prom was created to provide free prom dresses to any Connecticut high school girl who otherwise may not be able to afford one. We were able to raise over $450 for the organization, and staff members brought in 48 dresses, along with numerous accessories to donate as well.

Pictured are FIA’s Karen Paulson, Princess & the Prom President Christina Gorman, FIA’s Devon Francis and Princess & the Prom Vice President Allison Matthews-Wilson at FIA’s in-office fundraiser.

Twenty newly-minted MBA students gathered on campus to celebrate the culmination of their degree program with local entrepreneurs, Mark Wetzel & Maureen Cooper (also pictured Mo Sattar, Director, MBA in Entrepreneurial Thinking and Innovative Practices at Bay Path). Wetzel served as the evening’s featured speaker.

Our 12-member FIA relay team ran from Hull, MA, to Provincetown (almost 200 miles) in 28 hours! Pictured above, left to right, are Drew Cooper, Carrie Gallo, Oakley Duryea, Pete Nadeau, Devon Francis, Chris Kachmar, Dennis Scarpa, Tony Tranghese, Rob Lowry, Andrew Salak and Johann Cooper (not pictured is Katie Marino). Congratulations team!

RAGNAR RELAY CAPE COD

FIA ENTREPRENEURSHIP AWARDS AT BAY PATH

UNIVERSITY

One of FIA’s pension clients decided to implement a de-risking glide path as part of an

overall goal of limiting funded status volatility. FIA’s recommendation was to redesign

the fixed income allocation to more closely match the liability profile of the pension plan.

The client and FIA conducted an investment manager search and ultimately hired a firm

that creates customized fixed income portfolios that mimic the profile of the pension’s

liabilities. Going forward, the allocation to this customized solution will increase as

contributions are made to the plan and the client continues to de-risk the plan.

Case Study

FIA recently partnered with a large 401(k) plan sponsor to evaluate its current investment menu and fee structure. At the onset, the committee worked with FIA to develop their list of philosophical goals and objectives. Of primary interest to the committee were solutions to simplify the overall investment selection process for participants, improvements to the overall transparency of fees participants may pay through the plan and ideas for increasing employee engagement in the plan. The committee sought to achieve these objectives without having the potential changes perceived as a “take away” by the participants.

After several months of analysis and reviewing solutions, the committee elected to implement a new design for their investment menu and a new fee structure. The investment menu would be reduced from 20 options (counting the target date suite as one option) to ten options. The new investment menu would feature more low cost index and institutionally priced investments as well as low cost Collective Investment Trusts (CIT’s). Much of the consolidation was achieved within the U.S. equity offerings, where duplication existed. The plan’s pricing model would also shift, from a bundled asset based model to a fixed dollar per participant fee. Through the combination of simplifying the investment menu and moving to a new pricing model, the average participant would experience a decrease in fees of more than 50%.

Case Study

These and many other white papers are featured on our website: www.fiallc.com

32ND ANNUAL FOODSHARE WALK AGAINST HUNGER

Foodshare is a regional food bank serving 300 anti-hunger programs throughout Hartford and Tolland Counties. This year, the walk took place on May 3rd in Hartford. Representing team FIA were Elizabeth DeMarchi, Kelly McGuinness, and Janet Ramos. Thanks to our walkers and their family members and friends who participated!

COLOR ME RAD 5k HARTFORDFIA team members David Fontaine and Tracey Flynn brought their families out for the annual Color Me Rad 5k, held at Rentschler Field on May 2nd.

2 0 1 4 H o l i d a y P a r t y

2 0 1 4 C l i e n t C o n f e r e n c e

100 Northfield DriveWindsor, CT 06095

225 Franklin StreetBoston, MA 02110

12 Depot StreetKennebunk, ME 04043

The Fiduciary Trail®The Fiduciary Trail® represents documentation of the process by which fiduciaries arrive at decisions pertaining to the pools of assets that they oversee. FIA formats the materials it prepares for clients in a manner that thoroughly supports and documents the rationale for arriving at these decisions. The aggregation of our work product creates the trail for our clients and offers evidence to vested parties that validates the decision-making process itself while justifying the conclusions reached.

www.fiallc.com

Strategic thinking. Customized Solutions.