(33) As regards investment yield, it is required to make disclosure of investment yield in current year and that in last year by securities category (like government securities and funds, etc.).

All payments made in reimbursement of sums allocated from the Fund's resources and income from investment of its capital are added to its resources.

11. Any cash balances in the Revolving Credit Fund would be invested and the income and capital gains or losses added to or substracted from the Fund.

Income derived from investments, other than trust fund investments, shall be credited to the general fund as miscellaneous income.

While it was not possible to find a pension fund portfolio sufficiently similar to the Fund apos s against which investment returns might be compared, a strategic benchmark for the Fund had been implemented on 1 January 1997.

When contributions can no longer cover benefit payments, investment income and capital returns will have much bigger implications for achieving the Fund's mission of going forward.

Income from investments

(a) A significant number of large pension funds have investments in the following additional asset classes inflation protected securities, high yield bonds and alternative investments (e.g., hedge funds, commodities, forestry and private equities).

An automated solution will be implemented to achieve effective monitoring of investment performance and risks undertaken and the prompt identification of the Fund's investment income and assets.

Article 42 The Company shall make a disclosure by investment variety (like central bank bills, treasury bonds and funds, etc.) of the investment scale of self owned capital in the current year and the last year, proportion of various securities in investment of self owned capital, and proceeds during the reporting period, etc.

The representative of the Secretary General cautioned against focusing on short term results and reiterated that investment returns should be looked at over the long term as the Fund had long term investment objectives.

As to the method used by the Fund to determine the investment rate of return, it was based on reviews and recommendations made by outside consultants.

Financial rule 9.3 specifies the conditions for the recording of investment income it provides, inter alia, that income from investments shall be credited to the Annual Programme Fund, unless required to maintain the Working Capital and Guarantee Fund.

The new investment management application is being introduced by Treasury, and when utilized to facilitate cash pooling will further improve yields on investments.

All LDCs that meet basic investment criteria will be able to benefit from UNCDF expertise and investment.

(vi) Interest income includes all interest and related investment income earned on invested funds, various bank accounts and time deposit

(vii) Interest income includes all interest and related investment income earned on invested funds, various bank accounts and time deposits

Financial rule 9.3 specifies the conditions for recording of investment income, which provides, inter alia, that income from investments shall be credited to the Annual Programme Fund, unless required to maintain the Working Capital and Guarantee Fund.

Income derived from investment of trust funds shall be credited to the respective trust funds, unless otherwise specified.

(iv) Miscellaneous income to the regular budget including income from investment of the Working Capital Fund and the General Fund, proceeds from the provision or rental of goods or services, or adjustments arising subsequent to the closing of an operational budget account such as a trust fund, special account, project, etc.

(c) Audit of investment performance based on the established benchmark used for comparison and to determine whether the returns meet the objectives of the Fund

The funds for securities investment and other similar funds as held by an enterprise shall not be classified as a loan or account receivable.

IV. INVESTMENTS OF THE FUND . 48 79 14

It shall also make disclosure of the amount of money prepared as the management cost of each fund and the amount of revenue from management cost as confirmed by the Company.

It was necessary to specify under which Fund account investment income accrues.

The Fund apos s real estate investments outperformed both bonds and cash during the biennium, with a total return of 8.6 per cent for the year ending 31 March 1997 and 18.9 per cent for the year ended 31 March 1998.

8. The liberalization of cross border flows had led to the internationalization of investments by institutional funds.

(c) Income derived from investments pertaining to trust funds reserve and special accounts shall be credited to the trust fund, reserve or special account concerned.

(a) Income derived from General Fund investments shall be credited as miscellaneous income.

(25) As regards income from management cost, it is required to make disclosure of the amount of such income at current period and last period according to such categories as income from securities investment fund management cost and income from social security fund management cost.

Notwithstanding the growth in the Fund s assets and a complex investment environment, there had been significant improvements in the efficiency and cost effectiveness of investment management.

1. Recognizes that the Fund's policy of broad diversification of its investments by currency, types of asset classes and geographical areas continues to be the most reliable method of reducing risk and improving returns over long periods of time

(d) Obtain the required 3.5 per cent annualized real rate of return for the investments of the Fund over the long term after adjustment based on the United States consumer price index.

For the project company, the revenue generated by the infrastructure facility is the sole source of funds for repaying its debts, recouping its investment and making profit.

70. This involves activities related to the use of the mechanism of investment funds (country funds, venture capital funds or specific sectoral investment funds) to attract foreign investment flows in least developed countries.

Rule 106.1

Another possibility is the development of foreign investment funds investing in a diversified portfolio of domestic currency denominated debt of developing countries, which provide, through diversification, risk adjusted rates of return that are attractive to foreign investors.

The National Committees and PSD were also commended on the strong increase in private sector fund raising income and were asked to provide more information on the yield of investment funds.

Some investments, however, are made for the improvement of infrastructure in these cases, a quantifiable return is difficult to estimate the investment could be required to meet contractual obligations or to support effective and efficient business operations and, as such, would generally not generate a quantifiable return.

4. Other capital providers Capital providers other than commercial banks and international financial institutions may include institutional investors such as insurance companies, mutual funds, pension funds or investment funds.

Article 40 As regards commissioned investment management business, the Company shall make a disclosure by category (like social security fund, enterprise annuity and other special items) of the assets scale and proceeds of such business as well as the Company's income from such business and related risks took in such business during the reporting period.

As the Fund continues to mature it will rely more heavily on investment income for the payment of pensions and related benefits.

The Fund relies on three sources of income (a) employers' contributions (b) employees' contributions and (c) investment income.

(d) Retain the in house management of emerging market equities and create a team specialized in emerging markets and alternative investments to seek improvement in the risk return profile of the Fund

It also included the part that the profits allocated to the overseas investors belonged to the earnings from equity investments of dividends and bonus generated by the retained earnings which had been achieved for what was actually allocated to the investors by the enterprises held by Chinese residents.