Guidelines on Reports that Investment Funds, Investment Fund Management Companies, and Insurance Companies Submit to the Central Bank of Montenegro

4 ANNEX GUIDELINES ON REPORTS THAT INVESTMENT FUNDS, INVESTMENT FUND MANAGEMENT COMPANIES, AND INSURANCE COMPANIES SUBMIT TO THE CENTRAL BANK OF MONTENEGRO These Guidelines regulate in detail the manner of completing quarterly reporting forms: “Balances and transactions”, “Structure of interest-bearing financial instruments”, „Currency structure of balance sheet positions” and “Securities analytics”, provides the definitions of instruments and institutional sectors in accordance with the European System of Accounts - ESA 2010 (hereinafter: ESA 2010) methodology. REPORTING FORM: “BALANCES AND TRANSACTIONS” When completing the reporting form “Balances and transactions”, investment funds, investment fund management companies, and insurance companies, as the reporting institutions, shall submit data on balances and transactions per relevant balance sheet positions, institutional sectors, and maturity. In columns A and B in the “Balances and transactions” reporting form, the reporting institution shall enter data on the market and book value of the given balance sheet positions on a gross basis, with the balance as at the end of the reporting period in absolute amounts. The market value of financial instruments (column A) shall be entered for specific instruments that can be valued at market value (securities, financial derivatives). The book value (column B) represents the book value at the end of the reporting period per the prescribed accounting policies applied by the reporting institution. The sum of all positions in assets in column B must be equal to the sum of all positions in liabilities. In columns C and D in the “Balances and transactions” reporting form, the reporting institution shall enter data on purchases/issues and sales/repurchases (repayments) per specified balance sheet positions, with the amount of transactions during the reporting period, in absolute amounts. Financial transactions in columns C and D represent increases in the value of a financial instrument in assets or liabilities (position C) and decreases in the value of a financial instrument in assets or liabilities (position D). For example, the purchase of securities is a transaction in assets that leads to increased value of the financial instrument, while the issuance of securities leads to increased liability of the financial instrument. On the other hand, the sale of securities results in decreased assets of the financial instrument, while the purchase of securities or repayment of loans leads to decreased liabilities of the financial instrument.

5 The calculated interest is shown separately from the financial instrument to which it refers, in the spreadsheet “Structure of interest-bearing financial instruments”, as per assigned sectors. Definitions of balance sheet positions (instruments) and institutional sectors are specified in detail under the Instruments and Sector Classification points herein. For specific balance positions, the reporting institution shall submit analytics according to the original maturity of the given instrument. The original maturity refers to the exact lifetime of the financial instrument before the expiration of which the financial instrument cannot be redeemed or it can be redeemed with a certain penalty. REPORTING FORM “STRUCTURE OF INTEREST-BEARING FINANCIAL INSTRUMENTS” When completing the reporting form “Structure of interest-bearing financial instruments”, investment funds, investment fund management companies, and insurance companies, as the reporting institutions, shall submit data according to the specified balance sheet positions for interest-bearing instruments. The column “Interest amount” related to the amounts of all balances and transactions entered in the worksheet “Balances and transactions” for interest-bearing instruments is completed by singling out the amount of interest related to the specific instrument and attributing it to the corresponding sector. The sum of the amount of interest receivables/obligations by sector for a specific instrument must be equal to the total amount of interest related to that instrument. REPORTING FORM “CURRENCY STRUCTURE OF BALANCE SHEET POSITIONS” When completing the reporting form “Currency structure of balance sheet positions”, investment funds, investment fund management companies, and insurance companies, as the reporting institutions, shall submit data on amounts of all instruments by the currency structure. When completing the reporting form “Currency structure of balance sheet positions”, the reporting institution enters data on the currency structure for each instrument with an amount in another foreign currency and for all items of the worksheet “Balances and transactions”, by presenting the amount in euros, while all other currencies are to be reported cumulatively in the “Other foreign currency” column.

6 REPORTING FORM “SECURITIES ANALYTICS” Reporting Form „ Securities analytics” consists of four spreadsheets: Spreadsheet 1 – Analytics of the position A0511 “Investments into short-term debt securities” Spreadsheet 2 – Analytics of the position A0513 “Investments into long-term debt securities” Spreadsheet 3 – Analytics of the position A0531 “Listed shares” Spreadsheet 4 – Analytics of the position A0533 “Unlisted shares” The “Securities analytics” reporting form shows data for each security by individual ISIN number in the reporting institution's assets at the end of the reporting period. In columns A and B in the “Securities analytics” reporting form, for all four spreadsheets, the reporting institution enters data on the market and book value of the securities with the balance as at the end of the period, in absolute amounts1 . In columns C and D in the reporting form “Securities analytics”, for all four spreadsheets, the reporting institution enters data on the purchase/issue and sale/repurchase of these securities, with the amount of the transactions during the reporting period in absolute amounts. The sum of the market and book value of individual reported securities in spreadsheet 1

• Analysis of position A0511 “Investments in short-term debt securities” of the reporting form “Securities analysis” (columns A and B) must be equal to the reported market and book value for the instrument A0511 “Investments in short-term debt securities” (columns A and B) from the reporting form “Balances and transactions”. The sum of the market and book value of individual securities reported in spreadsheet 2
• Analysis of position A0513 “Investments in long-term debt securities” of the reporting form “Securities analytics” (columns A and B) must be equal to the reported market and book value on instrument A0513 “Investments in long-term debt securities” (columns A and B) of the reporting form “Balances and transactions”. The sum of the market and book values of individual reported securities in spreadsheet 3 - Analysis of position A0531 “Listed shares” of the reporting form “Securities analytics” (columns A and B) must be equal to the reported market and book value on instrument

1 The exception is Spreadsheet 4, where market value is not entered.

7 A0531 “Listed shares” (columns A and B) of the reporting form “Balances and transactions”. The sum of the book values of individual reported securities in spreadsheet 4 - Analysis of position A0533 “Unlisted shares” of the reporting form “Securities Analytics” (columns A and B) must be equal to the reported book value on instrument A0533 “Unlisted shares” (columns A and B) of the reporting form “Balances and transactions”. The same rules apply to reported transactions during the reporting period. INSTRUMENTS – BALANCE SHEET POSITIONS A) Instruments - balance sheet positions related to investment funds and investment fund management companies as the reporting institutions The reporting institutions shall submit data for the given instruments, as defined in the “Balances and transactions” reporting form. An overview of instrument definitions under the ESA 2010 methodology is shown below. Asset balance positions include the following instruments: Assets A02 Cash A021 Cash includes banknotes and coins in EUR and other currencies held with the reporting institution, which are in circulation and generally used for making payments. A03 Deposits A031 Transaction deposits include deposits that can be immediately converted into cash on demand or are transferable by payment order, check, e-money transaction, etc., without significant delay, restriction or penalty. Examples of transaction deposits are transaction accounts, demand deposits, demand savings deposits, dedicated accounts and other deposits with a maturity of up to one day etc. A033 Other deposits include all other types of deposits except for transactional deposits. Other deposits are not used for payments at any time and are not converted to cash or transaction deposits without significant restrictions or penalties. Examples of other deposits are time deposits, savings deposits, certificates of deposit where ownership cannot be transferred (they are not marketable) and the like.

8 A04 Loans Loans include funds that the reporting unit has lent to debtors. This position includes holding non-transferable debt securities that cannot be traded on secondary markets and subordinated debt in the form of a loan, i.e. a subordinated claim from the issuing institution, which can only be realised after all claims with a collection priority have been settled. Loans also include claims based on reverse repo transactions - based on which the reporting institution buys a security from the other contracting party at a fixed price, whereas the other contracting party will repurchase the same or similar security at a predetermined price on an agreed date in the future. A041 Short-term loans include loans whose original maturity is within one year. A043 Long-term loans include loans whose original maturity or maturity is over one year. A05 Securities A051 Investments in debt securities include transferable financial instruments serving as evidence of debt. On this instrument, it is necessary to disclose debt securities that allow the creditor an unlimited right to receive income through coupon payments or a determined fixed amount on a specific date(s). This instrument records subordinated debt in the form of debt securities and/or a subordinated claim from the issuing institution that can be realised after all claims with a higher status have been settled. It also records marketable loans with evidence of trading on the secondary market. Debt securities do not include repo contracts and non-transferable (non-marketable) securities, which will be classified as loans. For statistical purposes, subordinated debt should be classified as “loans” or “debt securities” according to the nature of the financial instrument. If all forms of subordinated debt held by reporting units are currently reported as a single amount for statistical purposes, such amount should be classified under “debt securities” because subordinated debt mainly consists of securities and not loans. According to their original maturity, debt securities are classified into short-term and long￾term debt securities. A0511 Investments in short-term debt securities include transferable short-term financial instruments that serve as evidence of debt, with a maturity within one year.

9 A0513 Investments in long-term debt securities include transferable long-term financial instruments that serve as evidence of debt, with a maturity of over one year. The counterparty for assets debt securities positions is determined according to the issuer of those debt securities. A053 Equity securities are financial assets entitle creditors to a share of the company's profits and a share of their net assets in a liquidation. For compiling financial account statistics, equity securities are divided into four instruments: A0531 Listed shares are equity securities listed on an exchange, on primary or secondary market. The existence of quoted prices of shares listed on an exchange means that current market prices are usually readily available. A0533 Unlisted shares are equity securities not listed on an exchange. are equity securities issued by unlisted companies. A0535 Other equity comprises all forms of equity including all forms of equity share other than those classified in sub-categories listed shares and unlisted shares (e.g. shares in a partnership, limited partnership or limited liability company). A0537 Investment fund shares or units include the holding of shares or units issued by investment funds. A06 Financial derivatives A061 Financial derivatives are financial instruments linked to a specified financial instrument or indicator or commodity, through which specific financial risks can be traded in financial markets in their own right. Financial derivatives include options, swap contracts, forward contracts - forwards, futures and warrants defined in Guidelines for monetary and financial statistics reporting. A07 Other non-financial assets A071 Other non-financial assets include tangible and intangible assets of the reporting institution, except for financial assets. This instrument shows the assets of the reporting institution, such as residential buildings and other facilities, plants and equipment, as well

10 as intellectual property, such as patents, concessions, software and other intangible assets. A08 Other assets A081 Advances given include claims arising when payment for goods or services is not made at the same time as the change in ownership of a good or provision of a service, i.e. they include funds paid in advance for the procurement of goods or services. A082 Other receivables include all unmentioned receivables of the reporting institution, which may arise due to time differences between the completed transaction and payment, such as deferred tax assets, accruals and other unmentioned receivables. A09 Insurance premium overpayments A091 Overpayments of insurance premiums are the part of the technical reserve that refers to the part of the insurance policy that has been paid and has not yet been earned. Liabilities balance sheet positions include the following instruments: Liabilities P03 Loans received Loans refer to the financial obligations of the reporting institution based on received loans. This instrument also includes loans based on repo contracts defined in the Guidelines for monetary and financial statistics reporting. Loans are classified according to their original maturity into short-term and long-term loans. P031 Short-term loans include loans whose original maturity is within one year. P033 Long-term loans include loans whose original maturity is over one year. P04 Issued debt securities

11 Issued debt securities are financial obligations of the reporting institution based on issued debt securities. According to their original maturity, they are classified into short￾term and long-term debt securities. P041 Issued short-term debt securities include debt securities issued by the reporting institution, with a maturity of up to one year. P043 Issued long-term debt securities include debt securities issued by the reporting institution, with a maturity of over one year. The classification of the other contracting party is done according to the holder of the debt security based on the data available to the reporting institution. The reporting institution only registers itself as a counterparty when it purchases its debt securities. P05 Financial derivatives P051 Financial derivatives include derivative financial liabilities of the reporting institution defined by the Guidelines for monetary and financial statistics reporting. P07 Other liabilities P071 Advances received - include funds received in advance for a specific good or service. P072 Other liabilities refer to all other unmentioned liabilities such as liabilities based on business expenses, deferred tax liabilities, salary liabilities and all other unmentioned liabilities. P08 Net assets of the investment fund P081 The net assets of the investment fund represent the total capital of the reporting institution. B) Instruments - balance sheet positions related to insurance companies as reporting institutions The reporting institution submits data for the given instruments, as defined in the “Balances and transactions” reporting form. An overview of instrument definitions under the ESA 2010 methodology is shown below.

12 Asset balance positions include the following instruments: Assets A02 Cash A021 Cash includes banknotes and coins in EUR and other currencies held with the reporting institution, which are in circulation and generally used for making payments. A03 Deposits A031 Transaction deposits include deposits that can be immediately converted into cash on demand or are transferable by payment order, check, e-money transaction, etc., without significant delay, restriction or penalty. Examples of transaction deposits are transaction accounts, demand deposits, demand savings deposits, dedicated accounts and other deposits with a maturity of up to one day etc. A033 Other deposits include all other types of deposits except for transactional deposits. Other deposits are not used for payments at any time and are not converted to cash or transaction deposits without significant restrictions or penalties. Examples of other deposits are time deposits, savings deposits, certificates of deposit where ownership cannot be transferred (they are not marketable) and the like. A04 Loans Loans include funds that the reporting unit has lent to debtors. This position includes holding non-transferable debt securities that cannot be traded on secondary markets and subordinated debt in the form of a loan, i.e., a subordinated claim from the issuing institution, which can only be realised after all claims with a collection priority have been settled. Loans also include claims based on reverse repo transactions - based on which the reporting institution buys a security from the other contracting party at a fixed price, whereas the other contracting party will repurchase the same or similar security at a predetermined price on an agreed date in the future. A041 Short-term loans include loans whose original maturity is within one year. A043 Long-term loans include loans whose original maturity or maturity is over one year. A05 Securities

13 A051 Investments in debt securities include transferable financial instruments serving as evidence of debt. On this instrument, it is necessary to disclose debt securities that allow the creditor an unlimited right to receive income through coupon payments or a determined fixed amount on a specific date(s). This instrument records subordinated debt in the form of debt securities and/or a subordinated claim from the issuing institution that can be realised after all claims with a higher status have been settled. It also records marketable loans with evidence of trading on the secondary market. Debt securities do not include repo contracts and non-transferable (non-marketable) securities, which will be classified as loans. For statistical purposes, subordinated debt should be classified as “loans” or “debt securities” according to the nature of the financial instrument. If all forms of subordinated debt held by reporting units are currently reported as a single amount for statistical purposes, such amount should be classified under “debt securities” because subordinated debt mainly consists of securities and not loans. According to their original maturity, debt securities are classified into short-term and long￾term debt securities. A0511 Investments in short-term debt securities include transferable short-term financial instruments that serve as evidence of debt, with a maturity within one year. A0513 Investments in long-term debt securities include transferable long-term financial instruments that serve as evidence of debt, with a maturity of over one year. The counterparty for assets debt securities positions is determined according to the issuer of those debt securities. A053 Equity securities are financial assets entitle creditors to a share of the company's profits and a share of their net assets in a liquidation. For compiling financial account statistics, equity securities are divided into four instruments: A0531 Listed shares are equity securities listed on an exchange, on primary or secondary market. The existence of quoted prices of shares listed on an exchange means that current market prices are usually readily available. A0533 Unlisted shares are equity securities not listed on an exchange. are equity securities issued by unlisted companies.

14 A0535 Other equity comprises all forms of equity including all forms of equity share other than those classified in sub-categories listed shares and unlisted shares (e.g. shares in a partnership, limited partnership or limited liability company). A0537 Investment fund shares or units include the holding of shares or units issued by investment funds. A06 Financial derivatives A061 Financial derivatives are financial instruments linked to a specified financial instrument or indicator or commodity, through which specific financial risks can be traded in financial markets in their own right. Financial derivatives include options, swap contracts, forward contracts - forwards, futures and warrants defined in Guidelines for monetary and financial statistics reporting. A07 Other non-financial assets A071 Other non-financial assets include tangible and intangible assets of the reporting institution, except for financial assets. This instrument shows the assets of the reporting institution, such as residential buildings and other facilities, plants and equipment, as well as intellectual property, such as patents, concessions, software and other intangible assets. A08 Other assets A081 Advances given include financial claims arising when approving deferred payments to natural and legal persons which the companies have not given, i.e. they appear when the payment of goods or services is not done at the same time when the transfer of ownership over goods or services. A082 Other receivables include all unmentioned receivables of the reporting institution, which may arise due to time differences between the completed transaction and payment, such as deferred tax assets, accruals and other unmentioned receivables. A09 Insurance premium overpayments A091 Overpayments of insurance premiums are the part of the technical reserve that refers to the part of the insurance policy that has been paid and has yet to be earned.

15 A10 Share of reinsurance in technical reserves A101 Share of reinsurance in technical reserves refers to the part of technical reserves related to the assumed obligation by the reinsurer that, in the event of the occurrence of the insured event that it has taken over for reinsurance, it will assume a part or the entire risk that is reinsured, with the insurer ceding to the reinsurer a part of the premium that is proportional to the part of the assumed risk. Liabilities balance sheet positions include the following instruments: Liabilities P03 Loans received Loans refer to the financial obligations of the reporting institution based on received loans. This instrument also includes loans based on repo contracts defined in the Guidelines for monetary and financial statistics reporting. Loans are classified according to their original maturity into short-term and long-term loans. P031 Short-term loans include loans whose original maturity is within one year. P033 Long-term loans include loans whose original maturity is over one year. P04 Issued debt securities P041 Issued short-term debt securities include debt securities issued by the reporting institution, with a maturity of up to one year. P043 Issued long-term debt securities include debt securities issued by the reporting institution, with a maturity of over one year. The classification of the other contracting party is done according to the holder of the debt security based on the data available to the reporting institution. The reporting institution only registers itself as a counterparty when it purchases its debt securities. P05 Financial derivatives

16 P051 Financial derivatives include derivative financial liabilities of the reporting institution defined by the Guidelines for monetary and financial statistics reporting. P06 Insurance technical reserves P061 Life insurance reserves include financial claims that enable the insurance beneficiary to pay commission and/or compensation paid after the death of the policyholder to his beneficiaries upon the expiration of the policy. P062 Other technical insurance reserves represent all reserves other than life insurance reserves. According to the ESA 2010 methodology, these include non-life insurance technical reserves that refer to claims that the insurance company realises through non-life insurance policies that are based on unearned premiums and accrued claims, and refer to accidents, fires, illnesses, travel insurance and the like, and pension rights that include all financial claims of former employees. P07 Other liabilities P071 Advances received - include funds received in advance for a specific good or service. P072 Other liabilities refer to all other liabilities arising from differences between the performed transaction and payments, such as liabilities based on business expenses, deferred tax liabilities, salary liabilities and all other unmentioned liabilities. P08 Total capital P081 Total capital of insurance company represents the total capital of the reporting institution that includes initial capital and reserves. CLASSIFICATION BY SECTORS According to these Guidelines, the analytics of the balance sheet positions of assets and liabilities is prescribed in such a way as to define the relationship between the reporting institution and the other contracting party (specific sectors) according to selected instruments and in accordance with the definitions of the other contracting party (specific sectors) according to the ESA 2010 methodology. For example, instrument A031

17 Transaction deposit represents the assets of the reporting institution with companies that receive deposits except for the central bank(s). Aggregation of institutional units by assigned sectors that indicate the other contracting party is done based on the list of institutional units that the reporting institution receives from the Central Bank, which is updated as necessary. The definitions of the given sectors in accordance with the ESA 2010 methodology are given below. S11 NON-FINANCIAL CORPORATIONS The non-financial corporations sector consists of institutional units which are independent legal entities and market producers, and whose principal activity is the production of goods and non-financial services. The non-financial corporations sector also includes non-financial quasi-corporations S12 FINANCIAL CORPORATIONS The financial corporations sector consists of institutional units which are independent legal entities and market producers, and whose principal activity is the production of financial services. Such institutional units comprise all corporations and quasi￾corporations which are principally engaged in financial intermediation (financial intermediaries) and/or auxiliary financial activities (financial auxiliaries). It also includes institutional units providing financial services, where most of either their assets or their liabilities are not transacted on open markets. The financial corporations sector is subdivided into the following subsectors: S121 Central bank; S122 Deposit-taking corporations except the central bank; S123 Money market funds; S124 Non-money market funds investment funds; S125 Other financial intermediaries, except insurance corporations and pension funds; S126 Financial auxiliaries; S127 Captive financial institutions and money lenders; S128 Insurance corporations; and

18 S129 Pension funds. Monetary financial institutions (S121+S122+S123) consist of all institutional units included in the central bank (S121), deposit-taking corporations except the central bank (S122) and money market funds (S123) subsectors. Other monetary financial institutions (S122+S123) consist of those financial intermediaries through which the effects of the monetary policy of the central bank (S121) are transmitted to the other entities of the economy. They are deposit-taking corporations except the central bank (S122) and money market funds (S123). S121 Central bank consists of entities whose principal function is to issue currency, to maintain the internal and external value of the currency and to hold all or part of the international reserves of the country. S122 Deposit-taking corporations except the central bank include all financial corporations and quasi-corporations, except those classified in the central bank and in the money market funds subsectors, which are principally engaged in financial intermediation and whose business is to receive deposits and/or close substitutes for deposits from institutional units, and to grant loans and/or make investments in securities. S123 Money market funds consist of funds whose business is to issue investment fund shares or units as close substitutes for deposits from institutional units, and, for their own account, to make investments primarily in money market fund shares/units, short-term debt securities, and/or deposits. S124 Non-money market funds consist of funds whose business is to issue investment fund shares or units which are not close substitutes for deposits, and, on their own account, to make investments primarily in financial assets other than short-term financial assets and in non-financial assets (usually real estate). S125 Other financial intermediaries, except insurance corporations and pension funds consists of all financial corporations and quasi-corporations which are principally engaged in financial intermediation by incurring liabilities in forms other than currency, deposits, or investment fund shares. Thus sub-sector also included financial vehicle corporations engaged in securitisation transactions, security and derivative dealers as well as financial corporations engaged in lending who include financial intermediaries engaged in financial leasing, factoring and the provision of personal or commercial finance. S126 Financial auxiliaries subsector consists of all financial corporations and quasi￾corporations which are principally engaged in activities closely related to financial intermediation but which are not financial intermediaries themselves. This subsector includes:

19 a) insurance brokers, salvage and average administrators, insurance and pension consultants, etc.; b) loan brokers, securities brokers, investment advisers, etc.; c) flotation corporations that manage the issue of securities; d) corporations whose principal function is to guarantee, by endorsement, bills and similar instruments; e) corporations which arrange derivative and hedging instruments, such as swaps, options and futures (without issuing them); f) corporations providing infrastructure for financial markets; g) central supervisory authorities of financial intermediaries and financial markets when they are separate institutional units; h) managers of pension funds, mutual funds, etc.; i) corporations providing stock exchange and insurance exchange; b) non-profit institutions recognised as independent legal entities serving financial corporations, but not engaged in financial intermediation; c) payment institutions; d) head offices whose subsidiaries are all or mostly financial corporations. S127 Captive financial institutions and money lenders subsector consists of all financial corporations and quasi-corporations which are neither engaged in financial intermediation nor in providing financial auxiliary services, and where most of either their assets or their liabilities are not transacted on open markets. This subsector includes: a) units as legal entities such as trusts, estates, agencies accounts or ‘brass plate’ companies; b) holding companies that hold controlling-levels of equity of a group of subsidiary corporations and whose principal activity is owning the group without providing any other service to the businesses in which the equity is held, that is, they do not administer or manage other units; c) special purpose entities that qualify as institutional units and raise funds in open markets to be used by their parent corporation; d) special purpose government funds, usually called sovereign wealth funds, if classified as financial corporations. e) units which provide financial services exclusively with own funds, or funds provided by a sponsor, to a range of clients and incur the financial risk of the debtor defaulting (e.g. money lenders, corporations engaged in lending to students or for foreign trade from funds received from a sponsor such as a government unit or a non-profit institution, and pawnshops that predominantly engage in lending); S128 Insurance corporations include all financial corporations and quasi-corporations which are principally engaged in financial intermediation as a consequence of the pooling of risks mainly in the form of direct insurance or reinsurance. S129 Pension funds include all financial corporations and quasi-corporations which are principally engaged in financial intermediation as the consequence of the pooling of social risks and needs of the insured persons (social insurance). Pension funds as social

20 insurance schemes provide income in retirement, and often benefits for death and disability. S13 General government General government sector consists of institutional units which are non-market producers whose output is intended for individual and collective consumption, and are financed by compulsory payments made by units belonging to other sectors, and institutional units principally engaged in the redistribution of national income and wealth. The general government sector is divided into three subsectors: S1311 Central government includes all administrative departments of the state and other central agencies whose competence extends normally over the whole economic territory, except for the administration of social security funds S1313 Local government includes those types of public administration whose competence extends to only a local part of the economic territory, apart from local agencies of social security funds.; S1314 Social security funds include central, state and local institutional units whose principal activity is to provide social benefits and which fulfil each of the following two criteria:

• by law or by regulation certain groups of the population are obliged to pay contributions; and
• general government is responsible for the management of the institution in respect of the settlement or approval of the contributions and benefits independently from its role as supervisory body or employer. S14 HOUSEHOLDS The households sector consists of individuals or groups of individuals as consumers and as entrepreneurs producing market goods and non-financial and financial services (market producers) provided that the production of goods and services is not by separate entities treated as quasi-corporations. S15 NON-PROFIT INSTITUTIONS SERVING HOUSEHOLDS (NPISH) Non-profit institutions serving households include non-profit institutions which are separate legal entities, which serve households and which are private non-market producers. Their principal resources are voluntary contributions in cash or in kind from households in their capacity as consumers, from payments made by general government and from property income. Where such institutions are not very important, they are included in the households sector, as their transactions are indistinguishable from units in that sector.

21 Sector 15 includes the following units: trade unions, professional or learned societies, consumers’ associations, political parties, churches or religious societies (including those financed but not controlled by governments), and social, cultural, recreational and sports clubs; and charities, relief and aid organisations financed by voluntary transfers in cash or in kind from other institutional units. It also includes charities, and relief or aid agencies serving non-resident units. S2 NON-RESIDENTS This sector records all transactions and flows of non-financial and financial corporations, non-profit institutions, households and general government with non-resident institutional units and other economic ties between residents and non-residents, e.g. residents’ receivables to non-residents. The reporting institutions are obliged to classify non-residents according to the definition of non-residents from the Law on Foreign Current and Capital Operations (OGRM 45/05 and OGM 62/08, 40/11, 62/13, 70/17).