Guideline on the Publication of Abridged Financial Statements

GUIDELINE ON THE PUBLICATION OF ABRIDGED FINANCIAL STATEMENTS OCTOBER 17, 2022 CENTRAL BANK OF TRINIDAD AND TOBAGO Page | - 1 -

GUIDELINE ON THE PUBLICATION OF ABRIDGED FINANCIAL STATEMENTS October 17, 2022

GUIDELINE ON THE PUBLICATION OF ABRIDGED FINANCIAL STATEMENTS OCTOBER 17, 2022 CENTRAL BANK OF TRINIDAD AND TOBAGO Page | 2 TABLE OF CONTENTS

1. INTRODUCTION...............................................................................................................................3
2. PURPOSE AND SCOPE OF THE GUIDELINE........................................................................4
3. KEY ABBREVIATIONS / TERMS................................................................................................4
4. FORMAT AND CONTENT OF THE ABRIDGED FINANCIAL STATEMENTS...........5
5. FORMAT AND CONTENT OF NOTES TO THE ABRIDGED FINANCIAL STATEMENTS....................................................................................................................................6
6. OTHER REQUIREMENTS REGARDING ABRIDGED FINANCIAL STATEMENTS 7
7. EFFECTIVE DATE............................................................................................................................7

GUIDELINE ON THE PUBLICATION OF ABRIDGED FINANCIAL STATEMENTS CENTRAL BANK OF TRINIDAD AND TOBAGO Page | 3

1. INTRODUCTION 1.1 The Central Bank of Trinidad and Tobago (“Central Bank”/ “Bank”) is empowered by Sections 10 (1) (a) and (b) of the Financial Institutions Act, 2008 (“FIA”) and Sections 278 (1) (a) and (b) of the Insurance Act, 2018 (“IA”) to issue guidelines to give effect to the respective legislation and enable the Bank to meet its objectives. 1.2 Section 80 (1) of the FIA1 and Section 152 (1) of the IA2 require licensees under the FIA and insurers under the IA and their respective financial holding companies (collectively, “regulated person”) to publish their audited financial statements (on an individual and consolidated basis) in the daily newspapers and to exhibit their audited financial statements in a conspicuous place in each of their offices. 1.3 However, section 80 (1A) of the FIA and section 152 (3) of the IA permit the Central Bank to create abridged financial statements3 for the purpose of publication by regulated persons and to consult with these persons for that purpose. The abridged financial statements must contain sufficient relevant information to present a true and fair view of the regulated person’s financial condition and performance over the past year. 1.4 Further, Sections 2(1) of the FIA and 4(1) of the IA define “abridged financial statements” as “a summary of financial statements, the format and contents of which are agreed to in writing between the Central Bank and the Institute of Chartered Accountants of Trinidad and Tobago (“ICATT”)” 4 . 1.5 Where a regulated person elects to publish abridged financial statements, the overriding consideration is that the abridged financial statements are required to give a 'true and fair view' of the state of affairs of the regulated person. Moreover, the regulated person must also make available, at their offices, at no cost, the full set of audited financial statements for review by its policyholders or depositors5 and other consumers upon request. 1.6 In this regard, the abridged financial statements to be published shall be audited in accordance with the International Auditing Standard (ISA) 810 (Revised) - Engagements to

1 Section 80 (1) of the FIA provides that every licensee and financial holding company shall within three months after the close of its financial year, publish in a daily newspaper printed and circulated in Trinidad and Tobago and exhibit in a conspicuous place in each of its offices, the audited financial statements referred to in section 77 (1) or, in the case of a licensee that is a licensed foreign institution, the audited financial statements referred to in section 77 (5). 2 Section 152 (1) of the IA provides that every insurer and financial holding company must exhibit in a conspicuous place in each of their offices and publish in at least two daily newspapers, within sixty business days after the end of its financial year, financial statements of all its operations in Trinidad and Tobago both domestic and foreign, prepared in accordance with financial reporting standards and duly audited in accordance with International Standards on Auditing, on an individual and consolidated basis. 3 See section 3 of this Guideline for a definition of abridged financial statements as contained in Section 2(1) of the FIA and 4(1) of the IA. 4 See section 152 (5) of the IA. Upon agreement of the format and content of the abridged financial statements, the Central Bank is required to publish a Notice in the Gazette and at least two daily newspapers. 5 Section 152(2) of the IA and section 80(2) of the FIA.

GUIDELINE ON THE PUBLICATION OF ABRIDGED FINANCIAL STATEMENTS CENTRAL BANK OF TRINIDAD AND TOBAGO Page | 4 Report on Summary Financial Statements. ISA 810 deals with the auditor's responsibilities relating to an engagement to report on summary financial statements derived from financial statements audited in accordance with ISAs by that same auditor. These abridged financial statements must be accompanied by an Auditor's report on the Abridged Financial Statements. 2. PURPOSE AND SCOPE OF THE GUIDELINE 2.1 In accordance with statutory requirements in both the FIA and IA, the purpose of this Guideline on the Publication of Abridged Financial Statements (“Guideline”) is to specify the format and contents of the abridged financial statements for the purpose of publication by regulated persons in the daily newspapers in accordance with section 80(1) and section 152(1) the FIA and IA respectively. 2.2 This Guideline must be read in conjunction with the requirements in the substantive laws (FIA and IA) regarding the publishing of audited financial statements and abridged financial statements. 2.3 This Guideline applies to regulated persons and is in respect of the financial statements on an individual and consolidated basis. 3. KEY ABBREVIATIONS / TERMS 3.1 All abbreviations and key terms used in this Guideline, except where otherwise defined, have the same meanings as obtains in the relevant legislation applicable to the regulated person. 3.2 For the purpose of this Guideline, the following applies: ABFS means abridged financial statements in the format and content specified by this Guideline AFS means audited financial statements required to be prepared on an individual and/or consolidated basis after each financial year end and submitted to the Inspector by regulated persons under the FIA and IA FIA means the Financial Institutions Act, 2008 (as amended) IA means the Insurance Act, 2018 (as amended) Regulated person means an insurer, a licensee and a financial holding company of an insurer or licensee.

GUIDELINE ON THE PUBLICATION OF ABRIDGED FINANCIAL STATEMENTS CENTRAL BANK OF TRINIDAD AND TOBAGO Page | 5 4. FORMAT AND CONTENT OF THE ABRIDGED FINANCIAL STATEMENTS 4.1 The ABFS cover an annual reporting period6 and present information at a reduced level from that contained in the full AFS. ABFS are intended to meet the information needs of those users who do not require all the information contained in AFS. 4.2 As such, ABFS generally contain less detail on the face of the statements and fewer notes than the full AFS. However, the information in ABFS should be drawn from and be consistent with the information in the full AFS for the period. The ABFS are therefore to be derived from the AFS and must contain the necessary information, so as not to be misleading in the circumstances. 4.3 Although ABFS do not comply with all the disclosure requirements under International Financial Reporting Standards (IFRS), information provided in ABFS is required to comply with all measurement and recognition requirements under International Financial Reporting Standards. 4.4 Therefore, the ABFS to be published by a regulated person must include the following statements exactly re-produced from the AFS to be prepared on an individual basis as follows: 4.4.1 Statement of Financial Position or equivalent; 4.4.2 Statement of Profit or Loss or equivalent; 4.4.3. Statement of Comprehensive Income or equivalent; 4.4.4 Statement of Changes in Equity or equivalent; and 4.4.5 Statement of Cash Flows or equivalent. And on a consolidated basis: 4.4.6 Consolidated Statement of Financial Position or equivalent; 4.4.7 Consolidated Statement of Profit or Loss or equivalent; 4.4.8 Consolidated Statement of Comprehensive Income or equivalent; 4.4.9 Consolidated Statement of Changes in Equity or equivalent; and 4.4.10 Consolidated Statement of Cash Flows or equivalent. In lieu of items 4.4.1 to 4.4.10, a regulated person may publish: 4.4.11 Individual and Consolidated Statement of Financial Position or equivalent; 4.4.12 Individual and Consolidated Statement of Profit or Loss or equivalent;

6 Exceptions may be made for reporting periods of less than a year or more than a year if the regulated person changes its year end.

GUIDELINE ON THE PUBLICATION OF ABRIDGED FINANCIAL STATEMENTS CENTRAL BANK OF TRINIDAD AND TOBAGO Page | 6 4.4.13 Individual and Consolidated Statement of Comprehensive Income or equivalent; 4.4.14 Individual and Consolidated Statement of Changes in Equity or equivalent; and 4.4.15 Individual and Consolidated Statement of Cash Flows or equivalent. 4.5 All ABFS must be accompanied by selected notes as specified in section 5 of this Guideline. 4.6 All ABFS must have affixed an Independent Auditor’s Report on the ABFS. 4.7 The ABFS and notes shall display prominently, the following information: 4.7.1 The name of the regulated person; 4.7.2 Whether they represent individual or consolidated financial statements; 4.7.3 The reporting date or period covered; and 4.7.4 The currency and the level of rounding used. 5. FORMAT AND CONTENT OF NOTES TO THE ABRIDGED FINANCIAL STATEMENTS 5.1 Regulated persons must disclose the following minimum information in the notes to the ABFS: 5.1.1 A note to the ABFS must be included to explain that although the AFS were prepared using IFRS, all of the notes necessary for a fair presentation in accordance with IFRS have not been included. The note also must state that the disclosures in the notes to the ABFS are limited to those matters that were considered material and necessary to present a true and fair view of the performance of the company. Statements should be made as to the type of audit opinion issued and the date of the auditor’s report. Notes to be included in the ABFS and their explanations/ descriptions are as follows: o Incorporation and Business Activities – The date of incorporation of the regulated person, the principal business activities conducted by the regulated person and the location of its registered office. This note should also identify the parent company of the regulated person, the subsidiaries and associated companies of the regulated person and any recent name changes of the regulated person. o Basis of Preparation - This should present information about the basis of preparation of the abridged financial statements noting that the ABFS are derived from the AFS which are prepared in accordance with International Financial Reporting Standards. A statement should be made that the abridged financial statements have been prepared in accordance with the accounting policies set out in the respective notes of the audited financial statements consistently applied from period to period, and that all new and revised accounting standards and interpretations that are mandatory for the period under review and which are relevant to the regulated person have been adopted. A statement should also

GUIDELINE ON THE PUBLICATION OF ABRIDGED FINANCIAL STATEMENTS CENTRAL BANK OF TRINIDAD AND TOBAGO Page | 7 be made on whether (or not) the financial statements have been prepared on the basis that it will continue to operate as a going concern. o Functional and Presentation Currency - The currency of the primary economic environment in which the regulated person operates and the currency in which the ABFS are presented including a description of any rounding of numbers. o Contingent Liabilities - The liabilities or potential losses that may occur in the future depending on the outcome of a specific event. Potential lawsuits, product warranties, and pending investigation are some examples of contingent liability. o Related party balances and transactions - The nature of related party relationships, and a description of transactions, amounts and balances on an aggregated basis. o Subsequent events – A description of all events occurring subsequent to the date of the most recent statement of financial position and/or statement of total comprehensive income for which disclosure was required to be made in the AFS. 6. OTHER REQUIREMENTS REGARDING ABRIDGED FINANCIAL STATEMENTS 6.1 The ABFS must include prominent statements: 6.1.1 identifying the ABFS as abridged financial statements; and 6.1.2 indicating that the full AFS of the regulated person can be accessed at each of its offices during normal business hours in accordance with section 80 (2) of the FIA and section 152 (2) of the IA. 6.2 In addition, it is recommended that regulated persons should publish a copy of their AFS on their websites. 6.3 The ABFS must contain financial data for the most recent financial year end of the regulated person as well as the previous financial year end. 6.4 Where a regulated person intends to publish ABFS, it must review this Guideline and institute appropriate measures to ensure compliance with the requirements contained herein for the publication of ABFS. 7. EFFECTIVE DATE 7.1 This Guideline comes into effect on October 17, 2022.