Report and Accounts Fundo de Pensões do Banco de Portugal Contribuição Definida

Transcription

1 Report and Accounts 2010 Fundo de Pensões do Banco de Portugal Contribuição Definida

2 Fundo de Pensões do Banco de Portugal Contribuição Definida 1 TABLE OF CONTENTS I. Management Report 1. Foreword 2. Investment Policy 2.1. Objectives 2.2. Principles and Restrictions 2.3. Initial Stage 3. Closing Remarks II. Statement of Assets and Liabilities and Income and Expenditure Statement III. Notes to the Statement of Assets and Liabilities and Income and Expenditure Statement IV. Certification of the Financial Statements

3 Fundo de Pensões do Banco de Portugal Contribuição Definida 2 MANAGEMENT REPORT 1. FOREWORD The changes to the Company-Level Agreements of Banco de Portugal (Acordos de Empresa), published on 22 June 2009 in the Work and Labour Bulletin (Boletim do Trabalho e Emprego), provided for the setting up of a Defined-Contribution Supplementary Plan, which will be funded by contributions of the Banco de Portugal and the employees who started working in the banking sector after 3 March 2009 and who are covered by the general Social Security Scheme, pursuant to Degree Law No 54/2009 of 2 March. Adherence to the Plan, foreseen in the Company-Level Agreements, is considered to be an option for the employee and mandatory to the Banco de Portugal, given the employee s choice to join. Both the Banco de Portugal and the employee must contribute with 1.5 per cent of the effective monthly wage, including the amount of holiday pay and Christmas bonus. The employee must indicate the pension fund in which these contributions are invested. This choice, which may be changed annually, must comply with the conditions set out in Clause 140 of the Company-Level Agreements. The Pension Fund of the Banco de Portugal -Defined Contribution (FPCD) is a funding vehicle for the Defined-Contribution Pension Fund Supplementary Plan, provided for in the Company-Level Agreements, formally known as Plano de Contribuição Definida AE, managed by the Sociedade Gestora dos Fundos de Pensões do Banco de Portugal, S.A. (Pension Funds Managing Company). This is a closed fund governed according to its deed of constitution, signed on 22 December 2010 and whose effects date back to 23 June 2009.

4 Fundo de Pensões do Banco de Portugal Contribuição Definida 3 2. INVESTMENT POLICY 2.1. Objectives The FPCD s investment policy aims not only at limiting the risk of a reduction in the participants purchasing power, but also at maximizing the real return of the funds under management, taking into account the likely time-frame in which funds can be claimed Principles and restrictions The recommended asset allocation for each participant is based on a life cycle approach, and on the time-frame in which payment is due, bearing in mind the expected date of retirement and the likelihood of the legal conditions of statutory early retirement being met. Alternatively, participants may choose a profile other than the one recommended. To pursue these goals it is crucial to take into account the need to ensure at all times: The maintenance of an appropriate liquidity level to address uncertainty over the time to maturity, the possibility of the funds being migrated to another investment profile or transferred to another pension fund managing company; The limitation of the risks affecting the FPCD s assets value through the adoption of prudential criteria for the selection of instruments and institutions eligible for investment; The diversification of the investments, so as to avoid risk accumulation, as well as an excessive concentration in any asset, issuer or group of companies.

5 Fundo de Pensões do Banco de Portugal Contribuição Definida Initial stage In the initial stage, the investment policy assumes a simplified form, materialized in a single investment portfolio composed of Euro Area sovereign debt, which complies with the principles and prudential rules applicable to the investments of the Pension Funds. FPCD s initial assets were raised through a cash contribution made by the Banco de Portugal, which set up a Sponsor Reserve Account (SRA). This account, set to provide the necessary scale for the portfolio management, will gradually be reduced over time, by debits of regular contributions to the FPCD, both from the Banco de Portugal and the participants (through a monthly debit in the salaries), and will be credited with the returns generated from its management. As at 31 December 2010, the portfolio value of the Defined Contribution Pension Fund amounted to 4,997 thousand euros, of which 4,923 thousand euros corresponded to the amount associated with the SRA and 74 thousand euros to the total value of individual accounts belonging to the Fund s participants.

6 Fundo de Pensões do Banco de Portugal Contribuição Definida 5 3. CLOSING REMARKS The Board of Directors would like to conclude the 2010 Report and Accounts by thanking the Banco de Portugal for its confidence and cooperation. A word of recognition is also due to the Instituto de Seguros de Portugal for the way it monitored the business of Sociedade Gestora dos Fundos de Pensões do Banco de Portugal, S.A.. Finally, we would like to highlight the high level of professionalism and dedication of all the staff of the Sociedade Gestora. Lisbon, 28 February 2011 António Manuel Martins Pereira Marta Vítor Manuel da Silva Rodrigues Pessoa Helena Maria de Almeida Martins Adegas

7 Fundo de Pensões do Banco de Portugal Contribuição Definida 6 FUNDO DE PENSÕES DO BANCO DE PORTUGAL CONTRIBUIÇÃO DEFINIDA Statement of Assets and Liabilities and Income and Expenditure Statement Notes to the Statement of Assets and Liabilities and Income and Expenditure Statement Certification of the Financial Statements

8 Fundo de Pensões do Banco de Portugal Contribuição Definida 7 STATEMENT OF ASSETS AND LIABILITIES AS AT 31 DECEMBER 2010 Notes 31-Dec-10 APPLICATIONS OF THE FUND Securities 4 4,991, Cash and bank deposits 5 5, Total applications of the fund 4,997, VALUE OF THE FUND Initial contribution to the Sponsor Reserve Account 6 4,926, Contributions under the Company-Level Agreement (clause 140) 6 73, Profit (loss) and accumulated contributions of the year 6-2, Total value of the fund 4,997, VALUE BY PARTICIPATION UNIT 1.00 The Accountant Paulo José Antunes Jorge The Board of Directors António Manuel Martins Pereira Marta Vitor Manuel da Silva Rodrigues Pessoa Helena Maria de Almeida Martins Adegas

9 Fundo de Pensões do Banco de Portugal Contribuição Definida 8 INCOME AND EXPENDITURE STATEMENT Notes 31-Dec-10 INCREASES IN THE VALUE OF THE FUND Initial contribution to the Sponsor Reserve Account 6 4,926, Contributions under the Company-Level Agreement (clause 140) 6 73, Total increases of the fund 5,000, DECREASES IN THE VALUE OF THE FUND Capital losses 7 2, Total decreases of the fund 2, PROFIT (LOSS) 4,997, The Accountant Paulo José Antunes Jorge The Board of Directors António Manuel Martins Pereira Marta Vitor Manuel da Silva Rodrigues Pessoa Helena Maria de Almeida Martins Adegas

10 Fundo de Pensões do Banco de Portugal Contribuição Definida 9 CASH FLOWS STATEMENT CASH FLOWS FROM OPERATING ACTIVITIES 31-Dec-10 Contributions Initial contribution to the Sponsor Reserve Account 4,926, Contributions under the Company-Level Agreement (clause 140) 73, Pensions, capital and matured single premiums Remunerations Proceeds NET CASH FLOWS FROM OPERATING ACTIVITIES Payments Purchase of Investments 4,994, NET CASH FLOWS FROM INVESTING ACTIVITIES Change in cash and cash equivalents 5, Effect of exchange rate differences 0.00 Cash and cash equivalents at beginning of period 0.00 Cash and cash equivalents at end of period 5,978.56

11 Fundo de Pensões do Banco de Portugal Contribuição Definida 10 NOTES TO THE STATEMENT OF ASSETS AND LIABILITIES AND THE INCOME AND EXPENDITURE STATEMENT 1. CREATION AND BUSINESS The Defined Contribution Pension Fund was created by the Banco de Portugal, in its capacity as Founder Sponsor, and by the Sociedade Gestora dos Fundos de Pensões do Banco de Portugal, S.A., in its capacity as managing company, by deed executed on 22 December The Banco de Portugal Defined Contribution Pension Fund is composed of autonomous assets exclusively earmarked for: a) The funding of pension plans foreseen in the agreement; b) The purchase of annuities, which ensure the benefits resulting from the plans in which they are covered; c) The payment of capital according to what is foreseen in the pension plans. It is a closed fund, whose members are: a) The employees of the Banco de Portugal, covered by the general Social Security Scheme, pursuant to Degree Law No 54/2009 of 2 March, who choose to join the complementary pension plans provided for in the collective labour agreement; b) Any employee of the Banco de Portugal, who joins the supplementary plan, regardless of the Social Security Scheme they integrate.

12 Fundo de Pensões do Banco de Portugal Contribuição Definida 11 The Fund s beneficiaries are individuals entitled to the cash benefits established in the chosen pension fund plan, defined in the deed of constitution. The Fund s assets are represented by whole or fractional participation units of each of the available portfolios, to which bid-ask quotes or prices are set. The Banco de Portugal Defined Contribution Pension Fund, which was initially created by one single portfolio, has been active since 27 December FINANTIAL STATEMENTS SUBMITTED The attached accounts were prepared in accordance with the accounting records of the Sociedade Gestora dos Fundos de Pensões do Banco de Portugal, S.A.. These accounts summarise the transactions and net assets of the Pension Fund. 3. ACCOUNTING PRINCIPLES, METHODS AND ASSUMPTIONS OF ASSETS VALUATION a) General The financial statements were prepared in accordance with the accounting principles generally accepted in Portugal and in accordance with the rules issued by the Instituto de Seguros de Portugal (The Portuguese Insurance and Pension Funds Supervisory Authority). The accounts were prepared under the historical cost convention (modified to include the present value principle for valuing the investment in credit securities) and on a goingconcern basis, pursuant to the fundamental accounting principles of consistency, prudence and accrual.

13 Fundo de Pensões do Banco de Portugal Contribuição Definida 12 b) Securities Financial investments in the portfolio on 31 December 2010 are marked to market in accordance with Standard No 9/2007 of 28 June of the Instituto de Seguros de Portugal. Pursuant to this standard, an economic methodology adapted to the type of financial asset in question is applied to securities whose listing price significantly departs from their fair market value. Pursuant to the provisions laid down in the applicable legislation, the portfolio of marketable securities, with low liquidity in regulated markets and chiefly traded over the counter, is valued by using prices made available by the main providers of financial information. The difference between the fair value of the securities and their respective acquisition cost is recorded under either capital gains or losses in the Income and Expenditure Statement. The difference between the proceeds from the sale of securities and their book value is also recorded under the same headings. c) Contributions The Fund s initial assets were raised through a cash contribution made by the Banco de Portugal, which was used to set up a Sponsor Reserve Account (SRA), under the terms of the contract that also defines the way in which the SRA is used (see Note 6). d) Income Income from securities is recorded in the period to which they refer, save for dividends, which are only recognised upon actual receipt.

14 Fundo de Pensões do Banco de Portugal Contribuição Definida 13 e) Fees Fees are booked under the corresponding heading in the Income and Expenditure Statement in the period to which they refer, regardless of their date of payment. Fees as yet unpaid are booked against Accrued Costs and prepaid fees are booked under Deferred Costs. f) Taxation The Pension Funds are exempt from Corporate Income Tax and Property Tax, in accordance with the Tax Benefit Act. 4. SECURITIES 31-Dec-10 EUR Acquisition Cost Adjustments Market Value Fixed-Income Securities-Bonds Sovereign debt 4,994, , ,991, ,994, , ,991, The adjustments correspond to unrealised capital gains or losses calculated as the difference between the market value and the historical acquisition cost.

15 Fundo de Pensões do Banco de Portugal Contribuição Definida CASH AND BANK DEPOSITS This heading is broken down as follows: 31-Dec-10 EUR Cash 0.00 Demand deposits 5, Term deposits , CONTRIBUTIONS Current contributions include, in addition to the SRA component, contributions made by the employees of the Banco de Portugal, in the conditions laid down in their corresponding pension plans. EUR 31-Dec-10 Initial contribution to the Sponsor Reserve Account 4,926, Contributions under the Company-Level Agreement (clause 140) 73, ,000,000.00

16 Fundo de Pensões do Banco de Portugal Contribuição Definida CAPITAL GAINS AND LOSSES This heading includes the following types of income: EUR 31-Dec-10 Unrealised capital gains and losses Securities Capital gains 0.00 Capital losses 2, , Realised capital gains and losses Securities Capital gains 0.00 Capital losses Total capital gains 0.00 Total capital losses 2, Net Value -2, CLOSING REMARK The Financial Statement is subject to requirements corresponding to Standard 7/2010-R of 4 July of the Instituto de Seguros de Portugal. This Standard defines the elements which must be published in the Financial Statement, so as to adapt the given information to the specific characteristics of each entity. Thus, certain elements have not been included, given the short existence and activity of the Banco de Portugal Defined Contribution Pension Fund in 2010.

17 Fundo de Pensões do Banco de Portugal Contribuição Definida 16 CERTIFICATION OF THE FINANCIAL STATEMENTS

18 Fundo de Pensões do Banco de Portugal Contribuição Definida 17 ERNST & YOUNG Ernst & Young Audit & Associados SROC, S.A. Avenida da República, 90, 6 th floor Lisbon Portugal Tel: Fax: Legal Certification of Accounts Introduction 1. We have audited the attached financial statements of Fundo de Pensões do Banco de Portugal Contribuição Definida (Fund), which comprise the Statement of Assets and Liabilities as at 31 December 2010, which shows total assets of 4,997, Euros and a value of the fund of the same amount, including negative net profits of 2, Euros, the Income and Expenditure Statement and the Cash Flows Statement for the year then ended, as well as the corresponding Notes. Responsibilities 2. The Board of Directors of the Sociedade Gestora dos Fundos de Pensões do Banco de Portugal ( Sociedade Gestora ) is responsible for preparing financial statements that give a true and fair view of the assets and liabilities of the Fund, the results of its operations and cash flows, as well as for adopting appropriate accounting policies and criteria and maintaining an appropriate internal control system. 3. We are responsible for expressing an independent and professional opinion on the basis of our audit of the aforementioned financial statements. Scope 4. We conducted our audit in accordance with the Standards and Technical Recommendations issued by the Institute of Statutory Auditors, which require that we plan and execute with a view to obtaining reasonable assurance whether the financial statements are free from material misstatement. Accordingly, the aforementioned audit included: Limited liability company * Share capital 1,105,000 euros * Registered in the Statutory Auditors Association under no. 178 * Registered in the CMVM under no * Taxpayer no * Registered in the Lisbon Commercial Registry under the same number * A member of Ernst & Young Global Limited

19 Fundo de Pensões do Banco de Portugal Contribuição Definida 18 examination, on a test basis, of documentation supporting the amounts and disclosures in the financial statements and an evaluation of the estimates, based on the judgements and criteria defined by the Board of Directors of Sociedade Gestora dos Fundos de Pensões do Banco de Portugal, used in the preparation of the financial statements; an assessment as to whether the accounting policies and the disclosures adopted are appropriate, as applicable; assessing that the accounts were prepared on a going-concern basis; and an overall assessment of the appropriateness of the financial statements. 5. Our audit also covered the verification that the financial information included in the Management Report is consistent with the financial statements. 6. We believe that the audit carried out provides a reasonable basis for expressing our audit opinion. Opinion 7. In our opinion, the aforementioned financial statements present fairly, in all material respects, of the financial position of the Fundo de Pensões do Banco de Portugal Contribuição Definida as at 31 December 2010, the results of its operations and cash flows for the financial year then ended, in accordance with accounting principles generally accepted in Portugal for the Pension Funds industry. (Regulatory Standard No 9/2007-R of 28 June and No 7/20010-R of 4 July). Lisbon, 15 March 2011 Ernst & Young Audit & Associados SROC, S.A. Firm of Statutory Auditors (No 178) Represented by: [signature] Ana Rosa Ribeiro Salcedas Montes Pinto (ROC No 1230)