Decision on Assessment and Calculation of Market and Net Value of Assets of Voluntary Pension Fund and Setting the Uniform Initial Value of Investment Unit

RS Official Gazette, No 60/2011, /corr. 61/2011/ Pursuant to Article 15, paragraph 1 of the Law on the National Bank of Serbia (RS Official Gazette, Nos 72/2003, 55/2004 and 44/2010) and Article 31, paragraph 6, Article 46, paragraph 6 and Article 47, paragraph 4 of the Law on Voluntary Pension Funds and Pension Schemes (RS Official Gazette, Nos 85/2005 and 31/2011), the Executive Board of the National Bank of Serbia hereby issues DECISION ON ASSESSMENT AND CALCULATION OF MARKET AND NET VALUE OF ASSETS OF VOLUNTARY PENSION FUND AND SETTING THE UNIFORM INITIAL VALUE OF INVESTMENT UNIT

1. This Decision prescribes in more detail the manner and frequency of
   assessing real estate that voluntary pension fund assets (hereinafter: fund assets) are invested in, the manner and frequency of calculating the market value of fund assets by categories, the manner of calculating the net value of fund assets, and sets the uniform initial value of the investment unit for all funds.
2. The value of fund assets shall be calculated every day. The day of
   valuation of fund assets (t) is the day preceding the day of calculation of net fund assets (t+1). Within the meaning hereof, the value of fund assets shall be the sum of values of securities from the portfolio of a voluntary pension fund (hereinafter: the fund), investment units of open-end investment funds that fund assets are invested in, real estate owned by the fund, deposits of fund’s financial assets with banks, fund’s financial assets with a custody bank account and fund’s receivables, calculated by the fair value to at least five decimal places, set in line with international standards and this Decision. The net value of fund assets equals the difference between the value of fund assets and fund liabilities on the same day, i.e. the product of the number of fund investment units and the value of the investment unit.
3. The fair value of securities constituting fund assets shall initially be
   calculated on the trading day at the purchase price exclusive of the costs of purchase and transfer of such securities. Notwithstanding paragraph 1 hereof, if the price or number of securities referred to in that paragraph are unknown until the settlement day, the fair value of such securities shall be calculated on the settlement day.

2
The subsequent calculation of the fair value of securities constituting fund assets shall be made depending on the type of securities that fund assets are invested in.
4. The fair value of securities issued by the National Bank of Serbia, the
Republic of Serbia, autonomous provinces and local government units in the Republic, and other legal entities with the guarantee of the Republic, as well as securities issued by international financial institutions in the Republic, and legal entities headquartered in the Republic, shall be their average daily price in the organised market in the Republic weighted by the trading volume. If securities referred to in paragraph 1 hereof were not traded on the valuation day, the fair value of these securities shall be their fair value of the preceding day. If there was no trade in securities referred to herein during 30 consecutive days, or if they are not traded in the organised market in the Republic, the fair value of these securities shall be calculated as prescribed by Section 6 hereof.
5. The fair value of securities issued by foreign governments,
international financial institutions outside of the Republic or foreign legal entities, shall be:
– for debt securities – the last offered price officially quoted on the financial information service; – for shares or depositary receipts – the last offered price on the stock exchange, determined as the primary source of price for that security and officially quoted on the financial information service. If securities referred to in paragraph 1 hereof were not traded on the valuation day, the fair value of these securities shall be their fair value of the preceding day. If there was no trade in securities referred to herein during 30 consecutive days, or if they are not traded in the organised market, the fair value of these securities shall be calculated as prescribed by Section 6 hereof.
6. If the fair value of securities cannot be determined as specified by
Sections 4 and 5 hereof, it shall be calculated as follows:

3

1. for debt securities – by discounting cash flows; the discount rate
   used in calculation is the prevailing market interest rate for such securities or debt securities with the same or nearly the same due date and the same credit rating;
2. for shares – the fair value is the price lower than the following two:
   − book value of share,
   − the last known price of share;
3. for depositary receipts – the fair value is the price lower than
   the following two:
   – price at which depositary receipts may be exchanged for their equivalent securities; − the last known price of the depositary receipts.

7. The fair value of money deposits with banks shall be calculated in
   accordance with their account balance, including any due and outstanding interest.
8. The fair value of real estate that fund assets are invested in shall be
   calculated based on its value assessed by a certified appraisal in line with law, while the assessment may not be older than 60 days following calculation. During this assessment, the yield method must be represented with the weight of at least 30%.
9. The fair value of investment units of open-end investment funds
   constituting fund assets shall initially be calculated on the day of purchasing these units, at the purchase price exclusive of the costs of such purchase. The fair value of these investment units shall be subsequently calculated as their last known value published by the company managing an open-end investment fund.
10. The value of fund assets expressed in a foreign currency shall be
    calculated in the dinar equivalent at the middle exchange rate of the National Bank of Serbia on the valuation day.
11. The management company shall, in line with this Decision, regulate
    by its acts the method of assessment and calculation of value for each type of assets that fund assets are invested in, describe in detail the methods and techniques used in this assessment and/or calculation and submit them to the National Bank of Serbia within eight days of their adoption.
12. If costs not collected from fund assets, in line with the Law on
    Voluntary Pension Funds and Pension Schemes, are collected from fund assets, the management company shall reimburse to the fund the costs

4 incurred from the 1st to 15th day of the month – until the 20th day of the month, while costs incurred from the 16th day of the month until the end of the month shall be reimbursed until the 5th day of the month.

14. The uniform initial value of the investment unit for all funds shall be set
    at RSD 1,000.
15. On the day of effectiveness hereof, the Decision on Assessment and
    Calculation of Market and Net Value of Assets of a Voluntary Pension Fund and Setting the Uniform Initial Value of the Investment Unit (RS Official Gazette, Nos 27/2006 and 24/2007) shall cease to be valid.
16. This Decision shall be published in the RS Official Gazette and shall
    enter into force on 1 October 2011.
    NBS Executive Board No 59 Chairman
    11 August 2011 of the Executive Board of the National Bank of Serbia Belgrade G o v e r n o r of the National Bank of Serbia Dr Dejan Šoškić