New Possibilities: ADP Retirement Services and Scudder Retirement Services

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New PossibilitiesADP Retirement Services and
Scudder Retirement Services
Benefit Services Alliance
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Benefit Services Alliance
Our vision is to harness the power of
partnership to deliver comprehensive retirement
and benefit solutions. By aligning the worlds
best transaction company with the worlds best
investment managers, our goal is to free our
clients to do what they do best, while helping
their employees secure a better financial
future.
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Benefit Services Alliance

• Industry dynamics
• Corporate snapshots of Scudder and ADP
• Benefit Services Alliance
• Scudder and ADP objectives for the alliance
• The product continuum
• Benefits to Scudder clients, advisors, TPAs

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Industry Dynamics

• Administration outsourcing increasing
• Changes competitor mix
• Provides new strategic options

• Decreased revenues from advisory fees
• Exposes poor fund performance
• Reduces benefit to retail

• Big players growing
• Small players exiting
• Increased necessity for scale and brand

Disaggregation
MarketConsolidation
OpenArchitecture
DefinedContributionIndustry
TechnologyInvestment
SlowingGrowth

• System upgrades to add functionality
• IT expertise required to customize
• New front-end interfaces for participants

• Largest opportunity in the Micro segment
• Retail-like products increasing (Simple
  IRAs, etc.)
• Fund choice and good performance required

CustomerRequirements

• Access to multiple funds
• Advice solutions demanded
• Brokerage accounts required

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Benefit Services Alliance

• Bringing together two industry leaders
• Enabling customers to do what they do best
• People are the key to success
• Will work across service/solution customer
  size spectrums

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Benefit Services Alliance
Benefit Services Alliance Plans
31,689 Participants 1,197,465 Assets Under
Administration 18.292 billion
as of 12/31/02
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Scudder Investments

• Scudder Investments is the US retail brand for
  Deutsche Asset Management, with over 740
• billion in assets under management
• Far-reaching global research organization that
  includes more than 600 portfolio managers and
  analysts
• Investment products for every investment
  objective
• 95 retail mutual funds

as of 12/31/02
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Scudder Retirement Services (SRS)

• One of the top defined contribution investment
  managers with approximately 40 billion in
  assets
• The right plan for any size employer from
  owner-only businesses to global corporations
• Same comprehensive service and technology
  provided to Fortune 500 clients is offered to
  emerging organizations
• Innovative and award-winning participant
  communication education solutions
• More than 400 retirement services associates
  serving over 15,000 retirement plan sponsors

as of 12/31/02
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ADP

• A Quick Look at ADP
• Founded in 1949, publicly traded since 1961
• Industry leader with over 7 billion in revenue
• Over 500,000 clients
• Service-oriented with more than 37,000 associates
  nationwide

as of 12/31/02
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ADP Employer Services

• Were the Business Behind Business
• Full-service provider HR, Payroll, Tax Filing,
  Benefits Administration and Professional
  Employer Organization (PEO) Services
• 4.2 billion revenue
• 450,000 clients
• Largest provider in North America, Europe,
  Latin America Australia

as of 12/31/02
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ADP Retirement Services

• Efficient recordkeeping provides for a
  profitable and sustainable business model
• Products include small- to mid-market plans,
  executive deferred compensation (EDC), and
  529 education savings plans
• Fully integrated with ADP payroll platforms
  (i.e., fully automated data and asset transfer)
• National sales, implementation, and enrollment
  capabilities

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Benefit Services Alliance

• Enables us to grow and remain industry leaders
• Creates a first-class retirement benefits
  services organization
• Combines complementary strengths of both
  companies to enable
• Integrated product mix
• Broader distribution channels
• Stronger system capabilities and platforms
• Ability to tap new markets

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Benefit Services Alliance

• Will offer retirement benefits outsourcing
  solutions to employers
• Will allow for the integrated delivery of
  products and services
• Scudders recordkeeping services professionals
  and information technology (IT) platform will
  join forces with ADPs resources to form
  Benefit Services Alliance
• Will jointly deliver service to retirement plan
  sponsors, plan participants and advisors
• Will leverage combined capabilities to market
  recordkeeping platform to third parties

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Alliance for Long-Term Growth
Value Creation
Expand products, services markets
Now
Positioning Benefit Services Alliance as a
leader in the market
Leverage distribution network cross-sell
services integrated payroll
Years 1-2
Grow client base via partnerships acquisition
Years 3-5
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Scudder Objectives

• The alliance addresses the objectives of Scudder
  Investments
• Grow assets under management
• Create a compelling value proposition
• Cause no disruption to client base
• Improve financial performance

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ADP Objectives

• The alliance addresses key elements of ADPs
  objectives for
• Entry into new markets
• Introduction of new products and services
• New distribution of recordkeeping and data
  management products
• Increased scale and efficiency

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SRS Product Continuum
SRS
Personal(k) Flex Plan Kansas City, MO
Premium Plan Mid/Large Market Salem, NH
0M 1M 3M 15M 50M 1B
PLAN SIZE BY ASSETS
as of 12/31/02
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ADP RS Product Continuum
as of 12/31/02
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SRS and ADP Product Continuum
unbundled/TPA enabled
bundled/future payroll integration
SRS
Personal(k) Flex Plan Kansas City, MO
Premium Plan Mid/Large Market Salem, NH
bundled
bundled/current payroll integration
ADP
Small Roseland, NJ
Mid Louisville, KY
0M 1M 3M 15M 50M 1B
PLAN SIZE BY ASSETS
ADP Assets Under Administration 5.137
Billion Total Participants 476,663 Total Plans
15, 457
SRS Assets Under Administration 13.155
Billion Total Participants 635,361 Total Plans
16,232
as of 12/31/02
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Benefits to Scudders Clients

• Serviced by same skilled professionals on
  the same state-of-the-art platform
  with no disruption in service
• Creates a platform for Total Retirement
  Outsourcing (TRO)
• Integrated and expanded product and
  service offerings
• Enhanced service capabilities and access to
  new technologies

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Benefits to Advisors/TPAs

• Increased focus and support for Scudder Flex Plan
  
• Additional support for Scudder Flex Plan TPAs

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Creating Opportunities
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Scudder Investments is part of Deutsche Asset
Management, which is the marketing name in the
U.S. for the asset management activities of
Deutsche Bank AG, Deutsche Bank Trust Company
Americas, Deutsche Asset Management Inc.,
Deutsche Asset Management Investment Services
Ltd., Deutsche Investment Management Americas
Inc., and Scudder Trust Company. Scudder
Distributors, Inc.222 South Riverside Plaza
Chicago, IL 60606-5808www.scudder.com MARS23095