Technical Standards for the Publication of Financial and Economic Information of Institutions of the Public Pension System

CNBCR-01/2023
NSP-79
TECHNICAL STANDARDS FOR THE PUBLICATION OF FINANCIAL AND ECONOMIC INFORMATION OF THE INSTITUTIONS OF THE PUBLIC PENSION SYSTEM Validity: 01/26/2023

THE STANDARDS COMMITTEE OF THE CENTRAL RESERVE BANK OF EL SALVADOR,

CONSIDERING:

I. That by Legislative Decree No. 614, dated December 20, 2022, published in the Official Journal No. 241, Volume No. 437, of the 21st of the same month and year, the Comprehensive Law of the Pension System was approved.

II. That Article 159 of the Comprehensive Law of the Pension System establishes that the Central Reserve Bank of El Salvador will issue the necessary Technical Standards that allow for the development of what is established in the aforementioned Law.

III. That in Article 99, subsection c) of the Law on Supervision and Regulation of the Financial System, it is established that it corresponds to the Standards Committee of the Central Reserve Bank to issue resolutions on the approval of technical standards for the preparation, approval, presentation, and dissemination of financial statements and supplementary information of the members of the financial system; for the determination of accounting obligations and the principles according to which they must keep their accounting and the establishment of criteria for the valuation of assets, liabilities, and the constitution of provisions and reserves for risks, all of the foregoing in accordance with what is established in this Law and other applicable laws, with the aim that the real liquidity and solvency situation of the aforementioned members is reflected.

IV. That Article 107 of the Organic Law of State Financial Administration establishes that the General Directorate of Government Accounting, through manuals and accounting policies and technical standards, will establish the format and content of the Financial Statements that must be prepared by entities and agencies of the Public Sector.

THEREFORE,

by virtue of the regulatory powers conferred upon it by Article 99 of the Law on Supervision and Regulation of the Financial System,

AGREES to issue the following:

TECHNICAL STANDARDS FOR THE PUBLICATION OF FINANCIAL AND ECONOMIC INFORMATION OF THE INSTITUTIONS OF THE PUBLIC PENSION SYSTEM

TECHNICAL STANDARDS FOR THE PUBLICATION OF FINANCIAL AND ECONOMIC INFORMATION OF THE INSTITUTIONS OF THE PUBLIC PENSION SYSTEM Validity: 01/26/2023

CHAPTER I
OBJECT, SUBJECTS, AND TERMS

Object
Art. 1.- These Standards aim to regulate the publication of financial and economic information of the Institutions that make up the Public Pension System.

Subjects
Art. 2.- The subjects obliged to comply with the provisions established in these Standards are:
a) Salvadoran Institute of Pensions; and b) Salvadoran Institute of Social Security.
Everything related to the Salvadoran Institute of Social Security in these Standards is applicable only with regard to the disability, old age, and death regime, administered by the Pension Unit of the Salvadoran Institute of Social Security.

Terms
Art. 3.- For the purposes of these Standards, the terms indicated below have the following meaning:
a) Pension Institutes: Refers to the Salvadoran Institute of Pensions and the Salvadoran Institute of Social Security; b) ISP: Salvadoran Institute of Pensions; c) ISSS: Salvadoran Institute of Social Security; d) UPISSS: Pension Unit of the ISSS; e) SPP: Public Pension System; and f) Superintendent: Superintendent of the Financial System.

CHAPTER II
GENERAL ASPECTS

Regarding economic and financial information
Art. 4.- The Pension Institutes must publish financial and economic information according to the formats presented in the following Annexes:
Annex No. 1: Statement of Financial Position.
Annex No. 2: Statement of Financial Performance. (1)
Annex No. 3: Statement of Cash Flows. (1)

Art. 5.- The Financial Statements will be published in comparative form, and the figures must be expressed in thousands of United States dollars with two decimals, as follows: (1)

TECHNICAL STANDARDS FOR THE PUBLICATION OF FINANCIAL AND ECONOMIC INFORMATION OF THE INSTITUTIONS OF THE PUBLIC PENSION SYSTEM Validity: 01/26/2023

a) The balances presented in the Statement of Financial Position, both semi-annual and annual, will be compared with the balances as of December 31 of the previous year; (1) b) The balances presented in the Economic Performance Statement of the semester must be compared with the balances as of June 30 of the previous year, and the balances presented in the Statement of December 31, with the balances of the same period of the previous year; and (1) c) The Annual Statement of Cash Flows will be compared with the balances as of December 31 of the previous year; (1) The Notes to the Financial Statements must be published as an integral part of them; applying Governmental Accounting Principle No. 8. Additionally, they must disclose a note referring to comprehensive risk management and compliance with their policies, as provided in Article 25-21), approved by the Central Reserve Bank of El Salvador through its Standards Committee. (1) The Financial Statements and their notes are declarations, the responsibility of the administration of the Pension Institute; therefore, it is their responsibility to prepare and publish them.

Art. 6.- At the bottom of the Financial Statements, the names of the General Director of the ISSS, General Manager of the Pension Unit, and Head of the Accounting Section of the UPISSS will appear, and in the case of the ISP, they must include the names of the President, Manager, and Head of the Accounting Department.

New Publication
Art. 7.- If the Superintendent becomes aware of data that alter, modify, or affect the published Financial Statements, it will require the respective Pension Institute to prepare a new publication, in the media and number of times necessary, accompanied by an explanatory note justifying the new publication; which must be previously reviewed by the Superintendent.

In the event that the Pension Institute refuses to publish the corrected Financial Statements, as well as their respective notes, required in accordance with these Standards, the Superintendent will set a deadline for the institution to make the publication effective; otherwise, the corresponding sanction will be imposed in accordance with what is established in the Law on Supervision and Regulation of the Financial System.

TECHNICAL STANDARDS FOR THE PUBLICATION OF FINANCIAL AND ECONOMIC INFORMATION OF THE INSTITUTIONS OF THE PUBLIC PENSION SYSTEM Validity: 01/26/2023

CHAPTER III
ON PUBLICATIONS

Publications of the Pension Institutes
Art. 8.- Each Pension Institute must publish once, in a newspaper of national circulation, the financial and economic information referred to in these Standards, considering the Annexes, periods, and dates detailed in these Standards.

Annual Publication
Art. 9.- The financial and economic information of the accounting period from January 1 to December 31 will include the following:
a) Content of the publication
i. Statement of Financial Position;
ii. Statement of Financial Performance; (1)
iii. Statement of Cash Flows; (1)
iv. Notes to the Financial Statements, which must allow for adequate interpretation of them and other transcendent aspects that by their nature were not revealed through figures; and
v. External Auditor's Report.
b) Publication Deadline
The publication described in the previous subsection will be made within the first 60 calendar days of each year.

Semi-annual Publications
Art. 10.- The publication as of June 30 of each year will include the following:
a) Content of the publication
i. Statement of Financial Position
ii. Statement of Financial Performance (1)
b) Publication Deadline
The publication must be made no later than July 31 of each year.

CHAPTER IV
OTHER PROVISIONS AND VALIDITY

Sanctions
Art. 11.- Non-compliance with the provisions contained in these Standards will be sanctioned in accordance with what is established in the Law on Supervision and Regulation of the Financial System.

TECHNICAL STANDARDS FOR THE PUBLICATION OF FINANCIAL AND ECONOMIC INFORMATION OF THE INSTITUTIONS OF THE PUBLIC PENSION SYSTEM Validity: 01/26/2023

Repeal
Art. 12.- These Standards repeal the Instruction Publication of Financial and Economic Information of the Institutions of the Public Pension System (SPP-01/99), approved on February 24, 1999, by the Superintendence of Pensions, whose Organic Law was repealed by Legislative Decree No. 592 containing the Law on Supervision and Regulation of the Financial System, published in the Official Journal No. 23, Volume No. 390, of February 2, 2011.

Unforeseen Aspects
Art. 13.- Aspects not foreseen in regulatory matters in these Standards will be resolved by the Central Reserve Bank of El Salvador through its Standards Committee.

Validity
Art. 14.- These Standards will enter into force as of the twenty-sixth of January of two thousand twenty-three.

MODIFICATIONS:
(1) Modifications to articles 4, 5, 9, and 10 and Annexes Nos. 1, 2, and 3, approved by the Bank through its Standards Committee in Session No. CN-11/2024 dated December 19, two thousand twenty-four, with validity as of January 3, two thousand twenty-five.

TECHNICAL STANDARDS FOR THE PUBLICATION OF FINANCIAL AND ECONOMIC INFORMATION OF THE INSTITUTIONS OF THE PUBLIC PENSION SYSTEM Validity: 01/26/2023

Annex No. 1 (1)

(NAME OF THE PENSION INSTITUTE)
STATEMENT OF FINANCIAL POSITION
AS OF __________________________
(In thousands of United States dollars)

CURRENT PREVIOUS

CURRENT ASSETS
FUNDS
. Liquidity
. Advances of Funds
. Monetary Debtors
FINANCIAL INVESTMENTS
. Temporary Investments
. Investments in Loans, Short Term
. Financial Debtors
. Goods and Services Paid in Advance
INVESTMENTS IN INVENTORY
. Institutional Inventory
. Inventory of Goods in Extinction of Domain
. Inventory of Production in Process
. Inventory for Sale
NON-CURRENT ASSETS
FUNDS
. Long-Term Financial Debtors
FINANCIAL INVESTMENTS
. Permanent Investments
. Investments in Loans, Long Term
. Intangible Investments
(-) Accumulated Amortization
. Unrecoverable Debtors and Investments
(-) Estimates of Unrecoverable Debtors and Investments INVESTMENTS IN ASSETS FOR USE . Depreciable Assets (-) Accumulated Depreciation . Infrastructure, Benefit, and Public Use Assets (-) Accumulated Depreciation . Non-Depreciable Assets

TECHNICAL STANDARDS FOR THE PUBLICATION OF FINANCIAL AND ECONOMIC INFORMATION OF THE INSTITUTIONS OF THE PUBLIC PENSION SYSTEM Validity: 01/26/2023

Annex No. 1 (1)

INVESTMENTS IN CURRENT PROJECTS AND PROGRAMS PREVIOUS . Investments in Private Goods (-) Application to Management Expenses . Investments in Public Use and Social Development Goods (-) Application of Public Investments TOTAL ASSETS

LIABILITIES
CURRENT LIABILITIES
CURRENT DEBT
. Third-Party Deposits
. Monetary Creditors
THIRD-PARTY FINANCING
. Internal Debt
. External Debt
. Financial Creditors
NON-CURRENT LIABILITIES
THIRD-PARTY FINANCING
. Long-Term Internal Debt
. Long-Term External Debt
. Long-Term Financial Creditors
SUBTOTAL

STATE EQUITY
. Equity
. Result of Previous Years
. Result of Current Year
. Reserves
. Detriment to Equity

TOTAL LIABILITIES + EQUITY

TECHNICAL STANDARDS FOR THE PUBLICATION OF FINANCIAL AND ECONOMIC INFORMATION OF THE INSTITUTIONS OF THE PUBLIC PENSION SYSTEM Validity: 01/26/2023

Annex No. 2
(NAME OF THE PENSION INSTITUTE)
STATEMENT OF FINANCIAL PERFORMANCE (1)
FROM _______________ TO ____________________
(In thousands of United States dollars)

CURRENT (1) PREVIOUS (1)
MANAGEMENT EXPENSES
. PENSION EXPENSES
. PERSONNEL EXPENSES
. CONSUMABLE GOODS AND SERVICES EXPENSES
. CAPITALIZABLE GOODS EXPENSES
. FINANCIAL AND OTHER EXPENSES
. EXPENSES ON GRANTED TRANSFERS
. COST OF SALES AND CALCULATED CHARGES
. EXPENSES ON UPDATES AND ADJUSTMENTS
TOTAL MANAGEMENT EXPENSES

MANAGEMENT INCOME
. SOCIAL SECURITY INCOME
. FINANCIAL AND OTHER INCOME
. INCOME FROM CURRENT TRANSFERS RECEIVED
. INCOME FROM CAPITAL TRANSFERS RECEIVED
. INCOME FROM SALES OF GOODS AND SERVICES
. INCOME FROM UPDATES AND ADJUSTMENTS

TOTAL MANAGEMENT INCOME

RESULTS OF THE YEAR

TECHNICAL STANDARDS FOR THE PUBLICATION OF FINANCIAL AND ECONOMIC INFORMATION OF THE INSTITUTIONS OF THE PUBLIC PENSION SYSTEM Validity: 01/26/2023

Annex No. 3
(NAME OF THE PENSION INSTITUTE)
STATEMENT OF CASH FLOWS (1)
FROM __________________ TO __________________
(In thousands of United States dollars)

20XX (1) 20XX (1)
INITIAL LIQUIDITY
INITIAL LIQUIDITY (1)
NET OPERATIONAL RESULT
SOURCES OF OPERATIONAL ACTIVITIES (1)
(-) USES OF OPERATIONAL ACTIVITIES (1)
NET THIRD-PARTY FINANCING
LOANS CONTRACTED
(-) DEBT SERVICE (1)
NET NON-OPERATIONAL RESULT
SOURCES OF NON-OPERATIONAL ACTIVITIES (1)
(-) USES OF NON-OPERATIONAL ACTIVITIES (1)
FINAL LIQUIDITY