Standard Life Investment Funds Limited Annual FSA Insurance Returns for the financial year ended 31 December 2011 Prepared in accordance with the Accounts and Statements Rules (Appendices 9.3, and 9.6)
Balance Sheet and Profit and Loss Account Contents Long Term Insurance Business: Revenue Account and Additional Information Form 40 Revenue account 1 Form 41 Analysis of premiums 3 Form 42 Analysis of claims 4 Form 43 Analysis of expenses 5 Form 45 Revenue account for internal linked funds 6 Form 46 Summary of new business 7 Form 47 Analysis of new business 8 Supplementary notes to the return 14 Directors' Certificate 18 Auditor's Report 19
Long-term insurance business : Revenue account Form 40 Total business / subfund Ordinary Long Term Units 000 Financial year Previous year 1 2 Income Earned premiums 11 8354605 8539903 Investment income receivable before deduction of tax Increase (decrease) in the value of non-linked assets brought into account Increase (decrease) in the value of linked assets 12 1895421 1710173 13 171236 91007 14 (2368302) 4912193 Other income 15 310824 261627 Total income 19 8363784 15514903 Expenditure Claims incurred 21 6727510 5862369 Expenses payable Interest payable before the deduction of tax Taxation 22 844421 805327 23 1397 730 24 33902 67510 Other expenditure 25 90616 81000 Transfer to (from) non technical account 26 (90616) Total expenditure 29 7607230 6816936 Business transfers - in 31 Business transfers - out 32 61967091 Increase (decrease) in fund in financial year (19-29+31-32) 39 (61210537) 8697967 Fund brought forward 49 61210537 52576987 Fund carried forward (39+49) 59 61274954 1
Form 40 Covering Sheet to Form 40 Global business P S Matthews Chief Executive J Gill Director M Hesketh Director 2
Long-term insurance business : Analysis of premiums Form 41 Total business / subfund Ordinary Long Term Units 000 UK Life UK Pension Overseas Total Financial year Total Previous year 1 2 3 4 5 Gross Regular premiums 11 53683 2327892 32332 2413907 2263899 Single premiums 12 202633 6637215 659802 7499650 7246875 Reinsurance - external Regular premiums 13 Single premiums 14 1558952 1558952 970871 Reinsurance - intra-group Regular premiums 15 Single premiums 16 Net of reinsurance Regular premiums 17 53683 2327892 32332 2413907 2263899 Single premiums 18 202633 5078263 659802 5940698 6276004 Total Gross 19 256316 8965107 692134 9913557 9510774 Reinsurance 20 1558952 1558952 970871 Net 21 256316 7406155 692134 8354605 8539903 3
Long-term insurance business : Analysis of claims Form 42 Total business / subfund Ordinary Long Term Units 000 Gross UK Life UK Pension Overseas Total Financial year Total Previous year 1 2 3 4 5 Death or disability lump sums 11 97444 63781 14105 175330 164254 Disability periodic payments 12 839 839 953 Surrender or partial surrender 13 904225 4795412 224014 5923651 5078376 Annuity payments 14 37907 364759 27445 430111 410682 Lump sums on maturity 15 48725 572222 62010 682957 663164 Total 16 1089140 5796174 327574 7212888 6317429 Reinsurance - external Death or disability lump sums 21 Disability periodic payments 22 Surrender or partial surrender 23 485378 485378 455060 Annuity payments 24 Lump sums on maturity 25 Total 26 485378 485378 455060 Reinsurance - intra-group Death or disability lump sums 31 Disability periodic payments 32 Surrender or partial surrender 33 Annuity payments 34 Lump sums on maturity 35 Total 36 Net of reinsurance Death or disability lump sums 41 97444 63781 14105 175330 164254 Disability periodic payments 42 839 839 953 Surrender or partial surrender 43 904225 4310034 224014 5438273 4623316 Annuity payments 44 37907 364759 27445 430111 410682 Lump sums on maturity 45 48725 572222 62010 682957 663164 Total 46 1089140 5310796 327574 6727510 5862369 4
Long-term insurance business : Analysis of expenses Form 43 Total business / subfund Ordinary Long Term Units 000 Gross UK Life UK Pension Overseas Total Financial year Total Previous year 1 2 3 4 5 Commission - acquisition 11 4236 51167 17393 72796 75863 Commission - other 12 12149 106927 3251 122327 110954 Management - acquisition 13 7615 173379 20738 201732 215204 Management - maintenance 14 51155 356271 35587 443013 399045 Management - other 15 439 4017 97 4553 4261 Total 16 75594 691761 77066 844421 805327 Reinsurance - external Commission - acquisition 21 Commission - other 22 Management - acquisition 23 Management - maintenance 24 Management - other 25 Total 26 Reinsurance - intra-group Commission - acquisition 31 Commission - other 32 Management - acquisition 33 Management - maintenance 34 Management - other 35 Total 36 Net of reinsurance Commission - acquisition 41 4236 51167 17393 72796 75863 Commission - other 42 12149 106927 3251 122327 110954 Management - acquisition 43 7615 173379 20738 201732 215204 Management - maintenance 44 51155 356271 35587 443013 399045 Management - other 45 439 4017 97 4553 4261 Total 46 75594 691761 77066 844421 805327 5
Long-term insurance business : Revenue account for internal linked funds Form 45 Total business Units 000 Financial year Previous year 1 2 Income Value of total creation of units Investment income attributable to the funds before deduction of tax Increase (decrease) in the value of investments in the financial year Other income 11 7601509 7770198 12 1750711 1582022 13 (2368102) 4914198 14 1734 5140 Total income 19 6985852 14271558 Expenditure Value of total cancellation of units Charges for management Charges in respect of tax on investment income Taxation on realised capital gains Increase (decrease) in amount set aside for tax on capital gains not yet realised Other expenditure 21 6290026 5454453 22 406273 386254 23 67681 85321 24 (11469) 5986 25 (46118) 47843 26 58730929 23511 Total expenditure 29 65437322 6003368 Increase (decrease) in funds in financial year (19-29) Internal linked fund brought forward Internal linked funds carried forward (39+49) 39 (58451470) 8268190 49 58451470 50247086 59 58515276 6
Long-term insurance business : Summary of new business Form 46 Total business Units 000 Number of new policyholders/ scheme members for direct insurance business Regular premium business 11 UK Life UK Pension Overseas Total Financial year Total Previous year 1 2 3 4 5 Single premium business 12 Total 13 Amount of new regular premiums Direct insurance business 21 External reinsurance 22 Intra-group reinsurance 23 20 657166 7786 664972 551764 Total 24 20 657166 7786 664972 551764 Amount of new single premiums Direct insurance business 25 External reinsurance 26 226200 226200 200293 Intra-group reinsurance 27 180913 5869676 581658 6632248 6513424 Total 28 180913 6095877 581658 6858448 6713717 7
Long-term insurance business : Analysis of new business Form 47 Total business Units 000 UK Life / Reinsurance accepted intra-group Product code number Product description Regular premium business Number of policyholders / scheme members Amount of premiums Single premium business Number of policyholders / scheme members Amount of premiums 1 2 3 4 5 6 395 Annuity non-profit (PLA) 2185 8 400 Annuity non-profit (CPA) 681 700 Life property linked single premium - Capital Investment Bond 61795 700 Life property linked single premium - Special Investment Bond 19449 700 Life property linked single premium - Tailored Investment Bond 41514 700 Life property linked single premium - Wrap Onshore Bond 55289 710 Life property linked whole life regular premium - Variable Protection Plan 19 715 Life property linked endowment regular premium - savings - Versatile Investment Plan 1
Long-term insurance business : Analysis of new business Form 47 Total business Units 000 UK Pension / Reinsurance accepted external Product code number Product description Regular premium business Number of policyholders / scheme members Amount of premiums Single premium business Number of policyholders / scheme members Amount of premiums 1 2 3 4 5 6 755 Trustee investment plan 226200 9
Long-term insurance business : Analysis of new business (Sheet 1) Form 47 Total business Units 000 UK Pension / Reinsurance accepted intra-group Product code number Product description Regular premium business Number of policyholders / scheme members Amount of premiums Single premium business Number of policyholders / scheme members Amount of premiums 1 2 3 4 5 6 400 Annuity non-profit (CPA) 302234 10 400 Annuity non-profit (CPA) - Group Annuity in Payment 1854 725 Individual pensions property linked - Active Money Personal Pension 11680 133439 725 Individual pensions property linked - Personal Pension Plan & Castle Pension Series 927 4827 725 Individual pensions property linked - Stakeholder 4858 16564 730 Individual pensions property linked - increments - Personal Pension Plan & Castle Pension Series 9441 96729 730 Individual pensions property linked - increments - Stakeholder 2935 46663 735 Group money purchase pensions property linked - Group Money Purchase Plan 26594 292702 735 Group money purchase pensions property linked - Personal Pension Plan & Castle Pension Series 72913 1963 735 Group money purchase pensions property linked - Stakeholder 72087 2454 735 Group money purchase pensions property linked - Trust Based Pension 70593 445241 740 740 Group money purchase pensions property linked - increments - Group Money Purchase Plan Group money purchase pensions property linked - increments - Personal Pension Plan & Castle Pension Series 9405 31541 27723 69106 740 Group money purchase pensions property linked - increments - Stakeholder 23776 40286 745 DWP National Insurance rebates property linked 111213
Long-term insurance business : Analysis of new business (Sheet 2) Form 47 Total business Units 000 UK Pension / Reinsurance accepted intra-group Product code number Product description Regular premium business Number of policyholders / scheme members Amount of premiums Single premium business Number of policyholders / scheme members Amount of premiums 1 2 3 4 5 6 750 Income drawdown property linked - Active Money SIPP 81 2892 11 750 Income drawdown property linked - Flexible Pension Plan 5 439 750 Income drawdown property linked - Group Flexible Retirement Plan 302992 840214 750 Income drawdown property linked - Group Self Invested Personal Pension 4289 31470 750 Income drawdown property linked - Pension Fund Withdrawal Product 840 750 Income drawdown property linked - Self Invested Personal Pension 13251 456547 750 Income drawdown property linked - Wrap Self Invested Personal Pension 3348 103815 755 Trustee investment plan 2829592 760 Small self administered schemes 269 1955 905 Index linked annuity 5097
Long-term insurance business : Analysis of new business (Sheet 1) Form 47 Total business Units 000 Overseas (Irish Republic) / Reinsurance accepted intra-group Product code number Product description Regular premium business Number of policyholders / scheme members Amount of premiums Single premium business Number of policyholders / scheme members Amount of premiums 1 2 3 4 5 6 400 Annuity non-profit (CPA) 18292 12 400 Annuity non-profit (CPA) - Group Annuity in Payment 247 700 Life property linked single premium - Money Works Bond 33 700 Life property linked single premium - Synergy Investment Bond 41832 700 Life property linked single premium - Synergy Portfolio Bond 18372 710 Life property linked whole life regular premium - Money Works Plan 11 725 Individual pensions property linked - Personal & executive pension plans 61 147 725 Individual pensions property linked - Synergy Buy Out Bond 49875 725 Individual pensions property linked - Synergy Executive Pension Plan 4108 14329 725 Individual pensions property linked - Synergy Personal Pension Plan 625 14930 725 Individual pensions property linked - Synergy PRSA 387 27001 730 Individual pensions property linked - increments - Personal & Executive Pension Plan 294 5221 730 Individual pensions property linked - increments - PRSA 110 6412 730 Individual pensions property linked - increments - Synergy Buy Out Bond 1868 730 Individual pensions property linked - increments - Synergy Executive Pension Plan 1837 34148
Long-term insurance business : Analysis of new business (Sheet 2) Form 47 Total business Units 000 Overseas (Irish Republic) / Reinsurance accepted intra-group Product code number Product description Regular premium business Number of policyholders / scheme members Amount of premiums Single premium business Number of policyholders / scheme members Amount of premiums 1 2 3 4 5 6 730 Individual pensions property linked - increments - Synergy Personal Pension Plan 264 15849 13 735 Group money purchase pensions property linked 52 153 740 Group money purchase pensions property linked - increments 37 377 750 Income drawdown property linked - Synergy Approved Retirement Funds 149560 765 Group managed fund 183012
Returns under the Accounts and Statements Rules Supplementary notes STANDARD LIFE INVESTMENT FUNDS LIMITED *0204* Business Transfer With effect from 23:59 on 31 December 2011, the long term insurance business carried on by the company was transferred to Standard Life Assurance Limited for a nil consideration in accordance with the terms of a scheme under Part VII of the Financial Services and Markets Act 2000 approved by the Court of Session in Edinburgh on 20 December 2011. Details of the regulatory value of assets and liabilities transferred under the scheme are as follows: Assets transferred (Form 13) LTBF OTLTBF 000 000 Equity shares 2 - Holdings in collective investment schemes 160,149 74,946 Rights under derivative contracts 4,069 - Fixed interest securities 3,038,102 - Bank and approved institution deposits 1 month or less 2,159 - Assets held to match linked liabilities 58,706,578 - Other debtors due in 12 months or less 71,575 - Deposits no time restrictions with approved institutions 6,888 8 Accrued interest and rent 67,053-62,050,375 74,954 Liabilities transferred (Form 14 and Form 15) LTBF OTLTBF 000 000 Mathematical reserves 61,842,937 - Provisions - taxation 37,816 - Amounts owed to credit institutions 5,045 - Creditors 40,424 111 61,926,222 111 Net assets transferred 124,153 74,843 Long term business fund transferred 61,967,091 14
Returns under the Accounts and Statements Rules Supplementary notes *4001* Brought forward amounts The application of different exchange rates to translate foreign currencies to sterling results in a difference between the fund brought forward in line 49 compared with the fund carried forward from the previous year at line 59. *4002* Other income and expenditure Other income reported at line 15 represents: 2011 2010 000 000 Fee and commission income 309,146 258,227 Receipt of contingent loan and capitalised interest 1,678 3,400 310,824 261,627 Other expenditure reported at line 25 represents: 2011 2010 000 000 Contingent loan repayment 90,616 81,000 *4004* Business Transfer Included in Form 40 Line 32 is the long term business fund transferred to Standard Life Assurance Limited on 31 st December 2011 as described in Note 0204. *4005* Basis of conversion of foreign currency Assets and liabilities of foreign branches have been translated at the rates of exchange ruling at the financial year end. The results of foreign branches have been translated at an average rate. Other foreign currency transactions have been translated at the exchange rate prevailing at the date of the transaction. Gains and losses arising from such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies have been recognised in the revenue account. 15
Returns under the Accounts and Statements Rules Supplementary notes *4008* Provision of management services During the financial year arrangements have been in place for the Company to be provided with management services by the following companies: Standard Life plc Standard Life Assurance Limited Standard Life Investments Limited Standard Life Employee Services Limited *4009* Material connected party transactions In addition to the business transfer described in Note 0204, the material connected party transactions which occurred during the year were as follows: The Company received some 9.9 billion of premiums in respect of reinsurance accepted from its parent undertaking, Standard Life Assurance Limited; The Company paid some 7.2 billion of claims in respect of reinsurance accepted from its parent undertaking, Standard Life Assurance Limited; The Company paid some 137 million to its parent undertaking, Standard Life Assurance Limited, in respect of costs incurred on behalf of the Company and recharged expenses; and The Company paid some 268 million to Standard Life Employee Services Limited, a fellow subsidiary of Standard Life plc, in respect of recharged expenses, including staff and office accommodation costs. *4501* Brought forward amounts The application of different exchange rates to translate foreign currencies to sterling results in a difference between the fund brought forward in line 49 compared to the fund carried forward from the previous year at line 59. *4502* Other income and expenditure Other income included within line 14 is as follows: 2011 2010 000 000 Sundry income 1,734 5,140 16
Returns under the Accounts and Statements Rules Supplementary notes Other expenditure included within line 26 is as follows: 2011 2010 000 000 Administrative expenses 22,251 22,166 Finance costs 2,100 1,345 Business transfers out 58,706,578-58,730,929 23,511. 17
Returns under the Accounts and Statements Rules Certificate by the directors required by IPRU(INS) 9.3(5) and IPRU(INS) Appendix 9.6 STANDARD LIFE INVESTMENT FUNDS LIMITED Global business We certify that - 1. (a) the return has been properly prepared in accordance with the requirements in IPRU(INS), GENPRU and INSPRU; and (b) we are satisfied that: (i) throughout the financial year in question, the insurer has complied in all material respects with the requirements in SYSC and PRIN as well as the provisions of IPRU(INS), GENPRU and INSPRU. 2. (a) no long-term insurance business has been carried on by the insurer since 23:59 on 31 December 2011, when all business was transferred to Standard Life Assurance Limited in accordance with the terms of a scheme under Part VII of the Financial Services and Markets Act 2000 approved by the Court of Session in Edinburgh on 20 December 2011; (b) there is no intention to carry on further any such business; and (c) the insurer is not carrying on general insurance business.. Chief Executive P S MATTHEWS.. Director J GILL.. Director M HESKETH 18
Returns under the Accounts and Statements Rules Report of the auditors to the directors pursuant to IPRU(INS) rule 9.35 STANDARD LIFE INVESTMENT FUNDS LIMITED Global Business Independent auditors report to the directors pursuant to rule 9.3 (6) of the Interim Prudential Sourcebook for Insurers We have audited the following documents prepared by the insurer pursuant to the Accounts and Statements Rules set out in part I and part IV of chapter 9 to IPRU(INS) the Interim Prudential Sourcebook for Insurers, GENPRU the General Prudential Sourcebook and INSPRU the Prudential Sourcebook for Insurers ("the Rules") made by the Financial Services Authority under section 138 of the Financial Services and Markets Act 2000: Forms 40 to 43 and 45, (including the supplementary notes) ("the Forms"); We are not required to audit and do not express an opinion on: Forms 46 and 47, (including the supplementary notes); the certificate required by IPRU(INS) rule 9.3(5). Respective responsibilities of the insurer and its auditors The insurer is responsible for the preparation of an annual return (including the Forms) under the provisions of the Rules. Under IPRU(INS) rule 9.11 the Forms are required to be prepared in the manner specified by the Rules and to state fairly the information provided on the basis required by the Rules. It is our responsibility to form an independent opinion as to whether the Forms meet these requirements, and to report our opinion to you. We also report to you if, in our opinion: adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us: or the Forms are not in agreement with the accounting records and returns; or we have not received all the information we require for our audit. This report has been prepared for the directors of to comply with their obligations under IPRU(INS) rule 9.3 (5) and for no other purpose. We do not, in providing this report, accept or assume responsibility for any other purpose save where expressly agreed by our prior consent in writing. Basis of opinion We conducted our work in accordance with Practice Note 20 'The audit of insurers in the United Kingdom (Revised)' issued by the Auditing Practices Board. Our work included examination, on a test basis, of evidence relevant to the amounts and disclosures in the Forms. The evidence included that previously obtained by us relating to the audit of the financial statements of the insurer for the financial year. It also included an assessment of the significant estimates and judgements made by the insurer in the preparation of the Forms. 19
Returns under the Accounts and Statements Rules Report of the auditors to the directors pursuant to IPRU(INS) rule 9.35 We planned and performed our work so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the Forms are free from material misstatement, whether caused by fraud or other irregularity or error and comply with IPRU(INS) rule 9.11. Opinion In our opinion the Forms fairly state the information provided on the basis required by the Rules as modified and have been properly prepared in accordance with the provisions of those Rules. PricewaterhouseCoopers LLP Chartered Accountants Date 20