The General Audit Chamber submitted its report entitled Compliance audit: 2016 Financial Statements of the General Pension Fund Sint Maarten (Algemeen Pensioenfonds Sint Maarten – APS) on August 28, 2018, to Parliament. The report addresses findings and conclusions of the review of the pension fund’s financial statement.
At the end of 2016, APS’s coverage ratio was 99,6%. The coverage ratio is the relationship between the pension fund’s capital and the pensions obligation provision. The coverage ratio for 2016 represents the third consecutive year that APS’s coverage ratio is under the minimum limit of 100%.
The report explains, that the increase of the coverage ratio from 92.6% in 2015, to 99.6% in 2016, is mainly due to the adjustment of the retirement age from 60 to 62 years. Due to the change of the retirement age, the accrued entitlement (built up pension) of the participant of APS who has not yet retired, is reduced by approximately 11%.
Uncertainty regarding the valuation of the outstanding claims has increased by 43.8% as compared to the previous year, according to the report. At the end of 2016, outstanding claims equaling ANG 37.1 million, remain uncertain.
The General Audit Chamber also highlights the adequacy of the internal control measures used in APS’s application and amendment process as relates to participant information. In the opinion of the General Audit Chamber, APS needs to improve their internal control measures for the application and amendment process of participant information. This is necessary to improve the reliability of the participant administration. The reliability of the participant administration is a recurring concern.
Although the APS ended the year 2016 with a positive financial result of ANG 41,8 million, the General Audit Chamber concludes that the financial status of the APS is not ideal. Critical issues such as the sub-optimal coverage ratio, the increased uncertainty regarding the value of outstanding claims, as well as the questionable reliability of the participant administration, are cause for concern.
The report is published in both English and Dutch and is available on the website of the General Audit Chamber (www.arsxm.org).
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