Financial Statements for the Year Ended 30 June 1993

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CONTENTS

THE HONG KONG UNIVERSITY OF SCIENCE AND TECHNOLOGY

Treasurer’s Report ... .3

Auditors’ Report.. ... .5

Balance Sheet ... .6

Income and Expenditure Statement.. ... .7

Cash Flow Statement.. ... .8

Reconciliation of Funding Surplus to Cash Flow from Operations.. ... .9

Notes to the Financial Statements 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. Significant Accounting Policies ... 10

Buildings and Construction-in-progress ... 12

Other Fixed Assets.. ... .13

Investments.. ... 14

Stocks ... 14

Government Holding Account ... 14

UPGC Holding Account.. ... 14

UPGC Triennium Equalization Account ... 15

Capital Account ... .I5 Capital Works Reserve Fund ... 16

Earmarked Grants from the Research Grants Council ... 16

Academic Exchanges with Institutions of Higher Education in China.. ... .17

Comparative Figures.. ... .17

Schedules to the Financial Statements 1. 2. 3. 4. 5. 6. 7.

a.

9. Sundry Receivables . . . Accounts Payable and Accruals . . . Long-term Liabilities . . . Provisions and Reserves . . . University Funds . . . Designated Endowment Funds . . . Government Subventions . . . Rental Recovery from Staff . . . Expenditure . . . . . . 18 . . .

ia

. . .

ia

. . . 19 ... 20 ... 23 ... .24 ... .24 ... 25

THE HKUST STAFF SUPERANNUATION SCHEME Trustees Report ... Auditors’ Report ... Balance Sheet.. ... Revenue Account.. ... Notes to the Financial Statements ... Actuarial Certificate ... Ill. THE HKUST ANCILLARY STAFF SUPERANNUATION SCHEME Trustees’ Report ... Auditors’ Report ... Balance Sheet ... Revenue Account.. ... Notes to the Financial Statements ... Actuarial Certificate.. ... 29 30 31 32 33 35 . . . 39 . . . ..*... 40 . . . 41 . . . 42 . . . 43 . . . 45

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THE HONG KONG UNIVERSITY OF SCIENCE AND TECHNOLOGY

FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 1993

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TREASURER’S REPORT

The University was still developing rapidly in 1992/93, with the total net assets increased by 21% to $3,623.7 million as at the end of the financial year.

2. Construction work on the campus - Phases I and II was substantially completed and buildings were handed over to the University by the end of June 1993. As at 30 June 1993, 86% of the approved budget of $3,548 million was actually spent. Of the total payments of $3,058 million, 60% was met from donations from the Royal Hong Kong Jockey Club and 40% was contributions from the Hong Kong Government.

3. On recurrent funding, 1991/92 was the first year when the University was funded directly by the UPGC and in that year the University received a one-year earmarked grant. From 1992/ 93 onward, the University began to operate as other UPGC-funded institutions with a triennial block grant. Under the block grant funding arrangement, the University is given a 3-year grant commencing from 1992/93 for recurrent expenditure and has greater flexibility in resource allocation.

4. The total recurrent income for the year increased from $335.4 million to $726.5 million, of which 93% was provided by the UPGC. Tuition fees income increased from $8.4 million to $25.5 million, representing 4% of the total income and increasing largely as a result of the growth in the student number.

5. The total recurrent expenditure for the year increased from $328.2 million to $659.1 million. Of the total expenditure, $369.2 million or 56% was for academic departments and academic support centres, $117.3 million or 18% was for maintenance of premises and grounds, $63.2 million or 9% was for administrative support, $50.9 million or 8% was for general education expenditure, student facilities and amenities, and $58.5 million or 9% was for staff benefits and miscellaneous.

6. In line with a general approval from the UPGC, transfers of $10.2 million were made from the block grant to specific reserves. The year ended with an operating surplus (after transfer to reserves) of $24.8 million and unspent balances totalling $31.7 million under indicated grants, totalling $56.5 million. These are carried forward under the UPGC Triennium Equalization Account for expenditure in 1993/94.

7. On furniture and equipment funding, $700 million was approved by the Government for the acquisition of specialist equipment and facilities for Phases I and II and a total of $164.1 million or 23% was expended up to 30 June 1993. In addition, the Government approved $194 million to meet requirements for basic teaching equipment for Phase I and a total of $101 .l million or 52% was expended up to 30 June 1993. The Government also approved $453 million for the acquisition of furniture and general equipment for Phases I and II and a total of $258.1 million or 57% was expended up to 30 June 1993. Following an agreement with the Government when funds for basic teaching equipment for Phase I were approved, the University has applied for new funds for the acquisition of basic teaching equipment for Phase II.

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8. On research funding, in addition to funds for individual projects from the block grant, the University continued to receive earmarked grants for research projects from the Research Grants Council mainly through allocations in response to competitive bids made by individual principal investigators from all UPGC-funded institutions. The University was given $12.6 million ($8.9 million in 1991/92) for competitive bids as well as a lump-sum grant of $3.5 million ($3 million in 1991/92) for distribution to individual research projects at the discretion of the University.

9. Apart from funding for individual research projects, the Research Grants Council also approved an earmarked grant of $1.8 million towards the cost of a Laser Direct Write Lithographic System in connection with microelectronics research activities jointly sponsored by The Hong Kong University of Science and Technology, The University of Hong Kong, The Chinese University of Hong Kong, Hong Kong Polytechnic and City Polytechnic of Hong Kong.

IO. During the year under review, $63.8 million was actually received from private foundations, industries and individuals to fund activities in various areas. Of this, $2 million was given to provide student scholarships, bursaries, prizes and loans, $47.6 million was directly for research, $4.4 million was to support other University activities and $9.8 million was for three designated endowments. These are in addition to income generated from self-financing activities.

11. The University will continue to develop rapidly in 1993/94 and it is envisaged that total funds as well as the recurrent income and expenditure will increase again by significant amounts.

12. Taking this opportunity, I would like to thank my colleagues in the Council’s Finance Committee and all parties involved in the management of the University’s finances for their advice and contributions during the year.

SIGNED

The Hon. LAU Wah-sum, OBE, JP Council Treasurer,

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AUDITORS’ REPORT

To: The Council of The Hong Kong University of Science and Technology

We have audited the financial statements of THE HONG KONG UNIVERSITY OF SCIENCE AND TECHNOLOGY (incorporated in Hong Kong under The Hong Kong University of Science and Technology Ordinance 1987) on pages 6 to 26 in accordance with Auditing Standards.

2. In our opinion, the financial statements give a true and fair view of the state of affairs of The Hong Kong University of Science and Technology as at 30 June 1993, and of its income and expenditure and cash flow for the year ended 30 June 1993, and have been properly prepared in accordance with The Hong Kong University of Science and Technology Ordinance 1987.

SIGNED

Deloitte Touche Tohmatsu Certified Public Accountants Hong Kong

20 October 1993

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30 June 1992 HK$‘OOQ 2,743,397 35,576 351,664 139,351 212,313 2,991,286 2,582,626 160,771 1,230 71,094 0 141,006 (33,333) 0 192 107,865

II

47,270 20,430 2,991,286 BALANCE SHEET AS AT 30 JUNE 1993 FIXED ASSETS Buildings Construction-in-progress Other Fixed Assets

INVESTMENTS CURRENT ASSETS

Stocks

Prepayments and Deposits Sundry Receivables Cash and Bank Balances

LESS: CURRENT LIABILITIES Accounts Payable and Accruals Government Holding Account UPGC Holding Account

NET CURRENT ASSETS NET ASSETS

BUILDING FUND CAPITAL FUND

LONG-TERM LIABILITIES PROVISIONS AND RESERVES GOVERNMENT FUNDS

UPGC Triennium Equalization Account Capital Account

Capital Works Reserve Fund Earmarked Grants from the Research

Grants Council

Academic Exchanges with lnstltutions of Higher Education in China

UNIVERSITY FUNDS General Funds Designated Funds

DESIGNATED ENDOWMENT FUNDS Capital Accounts

Recurrent Accounts

TOTAL FUNDS

Approved by the Council on 20 October 1993

6 7 2 3 8 9 10 11 12 Schedule 30 June 1993 HK$‘OOO HK%‘OOO

SIGNED SIGNED SIGNED

The Hon. LAU Wah-Sum Professor C hia-Wei WOO Norman W.Y. NGAI

Council Treasurer Vice-Chancellor/President Director of Finance 2,966,193 0 2,966,193 257,422 3,223,615 37,918 547,973 185,795 362,178 3,623,711 2,966,193 257,422 1,524 118,831 64,412 120,747 (17,865) 1.800 382 169,476 17,374 63,393 80.767 28,135 1,363 29,498 34623,711

The accompanying notes and schedules are an integral part of the financial statements.

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1 July 1991 to 30 June 1992 HK$‘OOO 313,281 8,402 6,405 6,615 733 INCOME UPGC Subventions Tuition Fees Bank Interest

Rental Recovery from Staff Miscellaneous

335,436 TOTAL INCOME

INCOME AND EXPENDITURE STATEMENT

FOR THE YEAR ENDED 30 JUNE 1993

1 July 1992 to Note Schedule 3OJu e 993

HKiO;O 7 677,593 25,502 10,251 8 12,459 726 726,531 43,870 168,442 48,653 20,145 5,312 41.797 EXPENDITURE Administration

Academic Departments and Academic Support Centres Maintenance of Premises and Grounds

General Education

Student Facilities and Amenities Miscellaneous 9 63,186 369,215 117,300 38,638 12,240 58,509 328.219 TOTAL EXPENDITURE 659.088 7,217 (978) (6,239) 0

EXCESS OF INCOME OVER EXPENDITURE

TRANSFERRED TO RESERVES 4

TRANSFERREDTOTHEUPGCHOLDINGACCOUNT 7

SURPLUS TRANSFERRED TO THE UPGC TRIENNIUM

67,443 (10,221)

(709)

EQUALIZATION ACCOUNT 8 56,513

The accompanying notes and schedules are an integral part of the financial statements.

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CASH FLOW STATEMENT

1 July 1991 1 July 1992 t0 t0 30 June 1992 30 June 1993 HK$‘OOO H K$‘OOO 101,556 819 18,900 (195,417) (74,142) (106) (74,248)

Capital Element of Finance Lease Rental Payments

INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 174,672

417.588 CASH AND CASH EQUIVALENTS BROUGHT FORWARD 343,340

343,340 CASH AND CASH EQUIVALENTS CARRIED FORWARD 518.012

NET CASH INFLOW FROM UNIVERSITY OPERATIONS CAPITAL INFLOW FROM ENDOWMENTS

RETURNS ON INVESTMENTS AND SERVICING OF FINANCE Interest Income from University Operations

Investment/Interest Income from Other Sources Interest Element of Finance Lease Rental Payments NET CASH INFLOW FROM RETURNS ON INVESTMENTS AND

SERVICING OF FINANCE INVESTING ACTIVITIES

Payments to Acquire Other Fixed Assets Receipts from Sales of Other Fixed Assets Investments

NET CASH OUTFLOW FROM INVESTING ACTIVITIES NET CASH INFLOW/(OUTFLOW) BEFORE FINANCING CASH OUTFLOW FROM FINANCING -

344,295 (955)

ANALYSIS OF THE BALANCES OF CASH AND CASH EQUIVALENTS Cash at Bank and in Hand

Bank Overdrafts 343,340 518,012 330,449 8,216 10,251

q

12,054 (180) 22,125 (185,957) 174,833 (161) 520,093 (2,081)

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RECONCILIATION OF FUNDING SURPLUS TO NET CASH INFLOW FROM UNIVERSITY OPERATIONS

‘FOR THE YEAR ENDED 30 JUNE 1993

1 July 1991 1 July 1992 t0 t0 30 June 1992 30 June 1993 HK$‘OOO HK$‘OOO 7,217 (3,344) (13,909) 0 101 14,478 264 (2,410) 4,807 159,842 (6.40:) (12,647) 140,790 - I

145,597 NET FUNDING SURPLUS 260,301

(3.32:) (2.715)

INCREASE IN STOCKS

INCREASE IN PREPAYMENTS AND DEPOSITS INCREASE IN SUNDRY RECEIVABLES

INCREASE/(DECREASE) IN ACCOUNTS PAYABLE AND ACCRUALS

(299) (877) (20,461)

(61,346) INCLUDING OVERPROVISION FOR OUTSTANDING COMMITMENTS 70,427

(15,165: DECREASE IN GOVERNMENT HOLDING ACCOUNT (10,220:

(15) DECREASE IN UPGC HOLDING ACCOUNT _(6,421)

177 INCREASE IN DEFERRED GRATUITIES 483

38,346 INCREASE IN PROVISIONS 37,516

(44,041) 70,148

101,556 NET CASH INFLOW FROM UNIVERSITY OPERATIONS 330,449

FUNDING SURPLUS

Surplus from University Operations Surplus/(Shortfall) from Other Sources

Capital Account

Capital Works Reserve Fund

Earmarked Grants from the Research Grants Council

Academic Exchanges with Institutions of Higher Education in China University Funds

Endowment Recurrent Accounts

TOTAL FUNDING SURPLUS

ADJUSTMENTS

Acquisition of Other Fixed Assets Disposal of Other Fixed Assets

Interest Income from University Operations Investment/Interest Income from Other Sources TOTAL ADJUSTMENTS 67,443 (20,259) 15,468 1,800 190 33,497 852 31,548 98,991 161,310

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NOTES TO THE FINANCIAL STATEMENTS

30 JUNE 1993

1. SIGNIFICANT ACCOUNTING POLICIES

1.1 Basis of Accounting

The University has adopted fund accounting under which funds are classified according to their nature or specified objectives to ensure observance, where appropriate, of limitations and restrictions placed on the use of available resources. All financial transactions are recorded in separate fund accounts according to such classifications.

The University has separately constituted a HKUST Educational Trust for the promotion and development of education and learning through teaching and research by the University, and independent Deeds of Trust for the University’s two superannuation schemes. Their accounts are prepared and audited separately and are not included in this set of financial statements.

1.2

1.3

7.4

Government Subventions

Recurrent Government subventions are accounted for on an accrual basis as they are and will be approved by the Government for the fiscal year. Capital Government subventions are accounted for on a cash received basis.

Expenditure and Commitments

It is the policy of the University to recognise, as a liability, approved expenditure relating to items in respect of which purchase orders have been placed by the University with suppliers but for which goods or services have not been received at the balance sheet date.

Buildings and Construction-in-progress

Construction-in-progress of the campus is capitalised to the Building Fund at cost but is not depreciated. When a building is completed and formally handed- over to the University, costs formerly recorded under the construction-in-progress are reclassified as Buildings and depreciated on a straight-line basis to write off from the Building Fund the capitalised costs of the buildings at the year end over their useful lives at 2% per annum.

The campus site located at Sai Kung of approximately 60 hectares was granted by the Government at a nominal rent for 58 years through 30 June 2047. The land grant, in the nature of an operating lease, is not recorded in the financial statements.

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1.5 Other Fixed Assets

The costs of other fixed assets acquired are first charged against the respective fund accounts in the year of acquisition based on approved orders and then capitalised to the Capital Fund on a payment basis. Depreciation is provided on a straight-line basis to write off from the Capital Fund the capitalised cost of other fixed assets at the year end over their useful lives at the following rates:-

Computing, audio/visual, maintenance, teaching and

sports equipment 25% per annum

Motor vehicles 25% per annum

Office and quarters furniture and equipment, and

electrical appliances 20% per annum

Assets leased under finance leases are capitalised at the present value of the minimum payments at the inception of the lease and depreciated on the same basis as mentioned above.

1.6 Investments

Listed and unlisted investments are stated at cost. Realised income and investment expenses are dealt with through the relevant fund accounts.

1.7 Stocks

Stocks held for resale in respect of self-financing operations are valued at the lower of cost and net realisable value. Other stocks are written off as expenditure against the respective fund accounts in the year of acquisition.

1.8 Library Books and Periodicals

Library books and periodicals are written off as expenditure against the respective fund accounts in the year of acquisition.

1.9

1.10

1.11

Donations, Donated Services and In-kind Contributions

Donations are accounted for on a cash received basis. The value of donated services and in-kind contributions is not recorded in the financial statements except in cases where their monetary benefits are material and can be reasonably assessed.

Taxation

The University is exempted from payment of tax by virtue of Section 88 of the Inland Revenue Ordinance.

Interest Income

Interest income amounts are accounted for as thev fall due.

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2. BUILDINGS AND CONSTRUCTION-IN-PROGRESS

The Campus Project Phases I and II, estimated to cost HK$3,548 million at the June 1990 price level, excluding furniture cost, is financed by a donation of HK$1,926 million from The Royal Hong Kong Jockey Club and a subvention of HK$1,622 million from the Hong Kong Government. The subvention of HK$1,622 million from the Hong Kong Government was approved by the Finance Committee of the Legislative Council on 1 June 1990. The Royal Hong Kong Jockey Club undertakes to supervise the construction of the campus. The balance of the Building Fund as at 30 June 1993 represents the capitalised net book value of buildings.

Construction- in- progress HK$'OOO COST As at 30 June 1992 Additions Transfer to Buildings 1,539,570 1,073,848 2,613,418 0 444,729 444,729 1,518,577 (1,518,577) 0 As at 30 June 1993 3,058,147 0 3,058,147 DEPRECIATION As at 30 June 1992 30,792 0

Charges for the Year 61,162 0

As at 30 June 1993 91,954 0

NET BOOKVALUE

As at 30 June 1993 2,966,193 0 2.966.193

As at 30 June 1992 1,508,778 1,073,848 2,582,626

Costs of the buildings of the campus prolect were financed by:

30June1992 30June1993

HK$'OOO HK$'OOO

1,456,709 Royal Hong Kong Jockey Club Donation i ,834,aaa

1 .156.709 Government Subvention 1.223.259 Total HK$'OOO 30,792 61,162 91,954 2,613,418 3,05a.i47

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3. OTHER FIXED ASSETS COST As at30June1992 Additions Disposals/Written Off As at 30 June 1993 233.645 3,586 184,377 421,608 DEPRECIATION As at 30 June 1992 Charges for the Year DisposalsMitten Off As at 30 June 1993 Computing, Audio/Visual, Maintenance, Teaching and Sports Equipment HK$‘OOO 109,977 2,976 115,152 228,105 123,729 832 69,315 193,876 (61) ₍₂₂₂₎ ₍₉₀₎ ₍₃₇₃₎ Motor Vehicles HKS’OOO Office and Quarters Furniture and Equipment,and Electrical llgpliances HK$‘OOO w HK%‘OOQ 35,232 1,197 30,905 67,334 59,369 850 36,873 97,092 (23) (180) (37) (240) 94,578 1,867 67,741 164,186

NET BOOK VALUE

As at 30 June 1993 139,067 1,719 116,636 257,422

As at 30 June 1992 74,745 1,779 84,247 160,771

Other fixed assets include one large photocopying machine under a finance /ease:-

HK$‘OOO

COST As at 30 June 1993 1,320

DEPRECIATION As at 30 June 1992

Charges for the Year

264 264

As at 30 June 1993 528

NET BOOK VALUE

As at 30 June 1993 792

As at 30 June 1992 1,056

Additions during the year included equipment of HK$lO. 116 million which was considered by the Trustees of the HKUST Educational Trust meeting on 30 November 7992 to have been given to the University.

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4. INVESTMENTS 30 June 1992 HK$‘OOO 30 Ju e 1993 HK;‘OOO 35,575 1 35,576

Listed Investments with Investment Managers at Cost

Unlisted Investments at Cost

University and Polytechnic Computer Centre Ltd. 1 share of HK$500 Fully Paid

37,917

1 37.91

a

The market value of listed investments as at 30 June 1993 was HK$42.674 miilion(l991/92, HK$38.548 million).

5. STOCKS

The value of stock on hand as at 30 June 1993 represented the closing balance of stock at cost in the University’s Souvenir Shop, which is a self-financing operation.

6. GOVERNMENT HOLDING ACCOUNT

Balance as at 30 June 1992

HK%‘OOO

10,220

Amount Refunded to the Government During the Year (10,220)

Balance as at 30 June 1993 0

7. UPGC HOLDING ACCOUNT

HKS’OOO

Amount Refunded to the UPGC During the year Amount of Rates Refund Shortfall (1992/93)

Reserved Supplementary Grants for General Salary Revision, 1992/93 - Excess Balance as at 30 June 1993 6,224 (6,224) (197) 709 512

The balance under the UPGC Holding Account represents the excess of the UPGC grants over specified expenditure and is to be refunded to the UPGC.

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8. UPGC TRIENNIUM EQUALIZATION ACCOUNT

HK$‘OOQ

Block Grant Surplus, 1992/93 Recurrent Grant

Indicated Equipment Grant

Indicated Language Enhancement Grant

24,796

I I

31,135

582 56,513

Overprovision for Outstanding Commitments Prior to the Year Ended 30 June 1991

For the Year Ended 30 June 1992

I

7.899 64.412

Under the block grant arrangement, the difference between funds released by the UPGC and the actual amount spent by the University is dealt with through the UPGC Triennium Equalization Account. The balance as at 30 June 1993, representing the excess of funds received over actual spending, is to be carried forward for use in the remaining years in the triennium. Surplus on the block grant, if any at the end of the triennium will be transferred to the UPGC Holding Account and refunded to the UPGC.

9. CAPITAL ACCOUNT Basic Teaching Equipment HK$‘OOO Interest Income HK$‘OOO Total HKS’OOO 253,233 Others HK$‘OOO 59,233 59,233 9,505 0 7,171 59,233 16,676 47,853 226 48,079 11,154 11,380 0 121,732 0 27,430 0 149.162 16.676 120.747 9,505 141,006 Approved Commitments 194,000 Subvention/Interest Received To 30 June 1992 During the Year

194,000 0 262,738 7.171 194,000 269,909 To 30 June 1993 Expenditure To 30 June 1992 During the Year

73,879 27,204 To 30 June 1993 101.083 92,917 Balances as at 30 June 1993 120,121 Balances as at 30 June 1992

Interest income for all Government funds was included as interest income under the recurrent account prior to 30 June 199 1. From the year started 1 July 1997, interest income was allocated to respective Government fund accounts based on their month-end fund balances. Unspent balances are to be carried forward to the next financial year

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10. CAPITAL WORKS RESERVE FUND

Approved Commitments 700,000 453,000 0 1,153,ooo

Subvention/Interest Received To 30 June 1992 During the Year

To 30 June 1993 156.288 247,285 779 404,352

Expenditure To 30 June 1992 During the Year

To 30 June 1993 164.107 258.110 0 422,217 Balances as at 30 June 1993 (7,819) (10,825) 779 (17,865) Balances as at 30 June 1992 (18.608) (14.930) 205 (33,333) Specialist Equipment . . . and FacMes HK$‘OOQ Furniture and General Eguipment HK%‘000 Interest income HK$‘OOO Ill&! HK.9000 67,488 141,695 205 209,388 88.800 105,590 574 194,964 86,096 156,625 0 242,721 78.011 101.485 0 179.496

interest income for all Government funds was included as interest income under the recurrent account prior to 30 June 1991. From the year started 7 July 7991, interest income was allocated to respective Government fund accounts based on their month-end fund balances. The shortfalls as at 30 June 1993 will be offset against funding to be released by the UPGC to the University in the next financial year

11. EARMARKED GRANTS FROM THE RESEARCH GRANTS COUNCIL

Direct Allocation HK$‘OOO Competitive Bids HKS’OOO Micro- electronics Research Equipment HK$‘OOO Total HK$‘000

Subvention Received During the Year 3,500 12,612 1,800 17,912

Less: Expended During the Year 3,500 12.612 0 16,112

Balance as at 30 June 1993 0 0 1,800 1,800

The unspent balance is to be carried forward to the next financial year.

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12. ACADEMIC EXCHANGES WITH INSTITUTIONS OF HIGHER EDUCATION IN CHINA

Add: Subvention Received During the Year 274

13.

Less: Expended During the Year

466 84

The unspent balance is to be carried forward to the next financial year.

COMPARATIVE FIGURES

Certain comparative figures of the previous year have been reclassified to conform to the current year’s presentation.

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SCHEDULES TO THE FINANCIAL STATEMENTS 30 JUNE 1993 1. SUNDRY RECEIVABLES Balance asat 30June1992 HK$'OOQ 1,830 0 300 4 822

Current Account with Biotechnology Research Institute Backpayments in relation to Salary Revision w.e.f. 1.4.1993

for the Period April to June 1993 Staff Debtors

Rates Recovery

Other Sundry Receivables

2,956 TOTAL 23,417

2. ACCOUNTS PAYABLE AND ACCRUALS

Balance Balance asat asat 30June1992 30June1993 HK%'OOO HKSOOQ 161 2,759 1,646 0 0 118,341

Obligations Under Finance Lease (Due Within One Year) Library Books Orders

Tuition Fees In Advance

Backpayments in relation to Salary Revision w.e.f. 1.4.1993 for the Period April to June 1993

Rates

Other Accounts Payable and Accruals

189 1,561 5,214 9,980 10,042 158,297 122,907 TOTAL 185,283 3. LONG-TERM LIABILITIES Balance asat 30June1992 HK$'OOO 177 970 83 Deferred Gratuities

Obligations Under Finance Lease In the Second to Fifth Years Inclusive After the Fifth Year

Balance asat 30 Ju e 999 HKi'O:, 1,461 9,980 377 10,240 1,359 Balance asat 30June1993 HKSOOO 660 864 0 1.230 TOTAL 1,524

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4. PROVISIONS AND RESERVES Motor Vehicles Balance as at 30June 199 2 HK$‘OOO 760 0 Amount Transferred HK$‘000 328 3,879 Amount Fz%t 1 0 Maintenance of Premises Balance as at 30Ju e 993 HK:‘O;O 1,088 3,879 Maintenance/Renovation of Staff Quarters

Air Conditioner Plants

Household Furniture/ Appliances

Photocopying Machines 0 0 0 678 1,669 1,041 2,601 1,381 0 Contractual Passages Gratuities

Leave Entitlement - Senior Staff

1,438 4,756 43,367 2,059 1,669 1,041 2,601 703 10,221 4,058 46,875 0 2,684 24,103 643 11,659 6,130 66,139 1,416

Student Residential Halls

General 1,323 0 470 963 0 1,040 1,400 0 16,281 28,332 333

Furniture and Equipment 0

Major Redecoration 0 Exchange Equalization 308 Research Projects 15,681 990 1,433 1,040 1,092 28,932 TOTAL 71,094 91,489 43.752 118.831

The transfers to Student Residential Halls Reserves during the year were made from halls accounts which are se/f-financing. All other transfers during the year were provided out of the UPGC subventions. The balances for Contractual Passages, Gratuities and Leave Entitlement include payments which fall due before 30 June 7994.

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5. UNIVERSITY FUNDS

GENERAL FUNDS Lam Woo Fund Leung Yat Sing Fund

The S.H. Ho Foundation Limited Fund TVB Fund

Others

Total General Funds

DESIGNATED FUNDS Draanlzed Research Units Asian Financial Market Centre Economic Development Centre Hong Kong Telecommunication Institute

of Information Technology Joyce M. Kuok Laser and Photonics

Laboratory

Sino Software Research Centre William Mong Semiconductor Clusters

Laboratory

Zheng Ge Ru Thin Film Physics Laboratory Sub-total (I)

Individual Research Proiects Croucher Foundation Hong Kong Supernet Lightwave Technology Mobile Telephone Remote Sensing Studies Telecommunication Network Others

Sub-total (II)

Sir S.K. Tana Library Fund Sub-total (Ill)

Balance Amount Investment/ Amount Balance as at Received/ Interest Expended/ as at 30 June 1992 Transferred Income Transferred 30 June 1993

HKS’OOO HK$‘OOO UKS’OOQ UK%‘000 HK$‘OOQ

1,259 2,107 10,174 0 428 13,968 1,767 1,767 1,489 0 1,750 17 0 0 1,750 17 0 0 12,700 6 11,217 5,288 2,500 229 890 5,269 5,000 215 4,084 0 3,000 78 2,003 5.287 2,500 227 2,293 15,844 29,200 789 20,487 25,346 7,127 6,400 1,075 5.721 1,250 20 0 70 0 161 2,500 0 0 7 3,750 258 39 2,490 184 1,993 335 10,000 0 2,500 44 391 602 17,374 1.260 0 36 290 1,006 0 1,500 8 150 1,358 0 8.500 0 312 8,188 0 1,200 0 0 1,200 0 2,480 5 0 2,485 0 1,500 0 192 1,308 390 3.229 8 1.001 2.626 1,650 18,409 57 1,945 18,171 14,607 0 949 0 15,556

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5. UNIVERSITY FUNDS (Cont’d)

Investment/

Scholarshias/ Bursarv Funds Asea Brown Boveri Scholarship

AST Research (Far East) Limited Scholarship CGCC (Foundation) Limited Bursary CGCC (Foundation) Limited Scholarship Chinese Manufacturer’s Association

of HK Scholarship Citibank Scholarship

Digital Equipment HK Limited Scholarship Du Pont Scholarship

Duty Free Shoppers Scholarship Epson Foundation Scholarship Ernst and Young Education Subsidy Gammon Construction Limited Scholarship HK Society of Accountants Scholarship Hong Kong Two/Ten International Footwear

Foundation Scholarship

Hsin Chong K.N. Godfrey Yeh Bursary IEEE H.K. Section Scholarship INC Trustees of Chiap Hua Cheng’s

Foundation Scholarship Indian Chamber of Commerce -

40th Anniversary Scholarship InterCham Scholarship

Jardine Matheson Limited Scholarship Joyce M. Kuok Foundation Scholarship Lam Woo Scholarship

Legend Technology Limited Scholarship Leslie Fay International (S.E.A.)

Limited Scholarship Leung Yat Sing Scholarship

Li PO Chun Charitable Trust Scholarship Miss Leung Pui Han Scholarship Motorola Semiconductors HK Limited

Scholarship

Parfums Christian Dior Scholarship Shell Hong Kong Limited Scholarship Sir Edward Youde Memorial Scholarship Sumitomo Electric Asia Limited Scholarship The Incorporated Trustees of Chiap Hua

Cheng’s Foundation Bursary Yoshie Hiraoka Memorial Scholarship

Sub-total (IV) as at Received/ 30 June 1992 Transferred Interest income HK$'000 0 10 0 0 0 16 0 0 0 0 0 0 0 0 0 0 0

HKS’OOQ

HK$‘000

9

9 0 10 20 0 90 90 0 10 10 0 28 28 0 24 40 0 22 22 0 35 35 0 12 12 0 12 12 0 10 10 0 36 36 0 5 5 0 10 10 0 213 213 0 1 1 0 135 135 0 5 5 0 35 35 0 47 44 25 300 303 0 10 10 0 12 12 0 24 24 0 7 7 0 58 58 0 75 86 37 23 23 0 25 25 0 30 30 0 216 216 0 5 10 0 120 141 58 2 5 148 328 1,656 " 1,722 268 0 0 22 3 0 0 0 0 0 48 78 146 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 5 f? Expended/ as at Transferred 30 June 1993

(23)

5. UNIVERSITY FUNDS (Cont’d)

Student Loan Funds

Kiangsu and Chekiang Residents (HK) Association Education Fund The American Women’s Association of

Hong Kong Limited Winsor Education Foundation

Sub-total (V)

Self-financina Activities and Others Undergraduate Halls

Summer Letting of Dormitory Places - Undergraduate Halls

Postgraduate Halls

Summer Letting of Dormitory Places - Postgraduate Halls

Visitors Centres

Conference and Workshops Executive Programmes and Classes MBA Programmes

University Development Fund Others

Sub-total (VI)

Total Designated Funds (l)+(ll)+(lll)+(lv)+(V)+(vl)

TOTAL UNIVERSITY FUNDS

Balance Amount Investment/ Amount Balance as at Received/ Interest Expended/ as at 30 June 1992 Transferred Income Transferred SO June 1993

HK$‘OOO HK$‘OOO HK%‘OOO HK$‘OOO HK$‘OOO

0 c 4 0 4 103 10 190 0 14 0 303 0 I7 0 0 0 103 7 0 190 293 14 0

5,072

91 5,163

0

178 229 7 252 162 0 1,445 25 1,470 0 180 (114 114 0 0 19 492 869 275 1,167 1,800 1,151 1,494 585 3,246 7 116 11 335 10 1,223 1 862 12 1,031 352 10 27 3,376 543 13,838 346 729 701 290 475 946 389 16,464 4,038 33,302 66,032 2,344 38,285 63,393 47,270 69,782 2,602 38,887 80,767

(24)

6. DESIGNATED ENDOWMENT FUNDS

CAPITAL ACCOUNTS Dow Hong Kong Scholarships

Endowment Fund

Elizabeth (Libby) Fuhriman Gardner Endowment Fund

HK Telecommunication Institute of

Information Technology Endowment Fund HKUST Arts Endowment Fund

Lee Hysan Foundation Endowment Fund Wei Lun Endowment Fund

Sub-total (I)

RECURRENT ACCOUNTS Dow Hong Kong Scholarships

Endowment Fund

Elizabeth (Libby) Fuhriman Gardner Endowment Fund

HK Telecommunication Institute of

Information Technology Endowment Fund HKUST Arts Endowment Fund

Lee Hysan Foundation Endowment Fund Wei Lun Endowment Fund

Sub-total (II) Balance as at 30 Ju e 1992 HK;‘OOO Amount Investment/ Received/ Interest Transferred Income yK%‘OOO HK$‘OOO Amount Balance Expended/ as at Transferred 30 June 993 HK$‘OOO ,K$‘O:O

0

800 100 0 14,000 819 0 5,000 19,919 6,000 0 3,000 0 9,800 0 0 0 26 12 14 0 2 8 10 0 253 19 0 239 6 1,270 832 83 28 25 0 37 0 0 338 67 91 1,707 946 697 105 37 510 511

TOTAL (I)+( II) 20,430 9.891 1.707 2.530 29.498

0

0 0 0 0 0 0

800

2 98 1,500 18,500 82 737 0 3,000 0 5,000 1,584 28,135 1,363

(25)

7. GOVERNMENT SUBVENTIONS

I July1991 to 30JuneI992

HK$'OOO

11,780 Recurrent Account, Surplus, April - June 1991 0

279,200

I

0 0 279,200 615,146 1,990 19,281

u

0 0 21,271 1.030 313.281 TOTAL 677.593 Recurrent Grant

Indicated Equipment Grant

Indicated Language Enhancement Grant

Reserved Supplementary Grants

Report No.26 With Effect From 1 April 1991 Salary Revision With Effect From 1 April 1991 Salary Revision With Effect From 1 April 1992

Salary Revision With Effect From 1 April 1993 (for April - June 1993)

Rates

8. RENTAL RECOVERY FROM STAFF

I July1991 I July1992 to to 30JuneI992 30JuneI993 HKS'OOO HK$'OOO 6.096 Recurrent Grant 519 0 0

Reserved Supplementary Grants

Salary Revision With Effect from 1 April 1991 Salary Revision With Effect from 1 April 1992

Salary Revision With Effect from 1 April 1993 (for April - June 1993)

6,615 TOTAL 12,459 I July1992 to 3OJu e 993 HKi'O;O 10,739 0 1,400 320

(26)

9. EXPENDITURE I July 1991 to 30 June 1992 HK$‘000 20,308 20,357 372 96 1,043 873 467 354 43,870 66,226 _183,752 Library

Salaries and Gratuities/Superannuation-Senior Staff Salaries and Gratuities/Superannuation-Support Staff Book Binding

General Office Expenses Library Books and Periodicals Library Electronic Media Library Media Resources Library On-line Search Others 34,439 22,826 5.903 Computer Facilities Research Grants Academic Support Centres

Centralised and Departmental Laboratories Deans’ Offices

Educational Technology Centre Industrial Training Centre Language Centre

Materials Characterisation and Preparahon Centre Microelectronics Fabrication Centre

Off ice of Contract and Grant Administration PVC(AA) Off ice

PVC(R&D) Office Research Centre

Technology Transfer Centre

11,569 9,146 200 541 30,722 3,000 2,508 725 692 59,103 34,525 12,220 8.378 5.641 4,207 4.26; 1,019 553 88 9,709 1,838 3,142 206 15,050 15,669 8,928 1,859 9,470 7,294 3,997 1,064 6,974 3,478 4,655 1,177 39.048 168,442 ADMINISTRATION

Salaries and Gratuities/Superannuation-Senior Staff Salaries and Gratuities/Superannuation-Support Staff Audit and Legal Fees

General Advertisements General Office Expenses Official Publications Postage

Vehicle Running Expenses Sub-total (I)

ACADEMIC DEPARTMENTS AND ACADEMIC SUPPORT CENTRES Academic Departments

Salaries and Gratuities/Superannuation-Senior Staff Salaries and Gratuities/Superannuation-Support Staff Equipment Maintenance

General Office/Laboratory Expenses Purchase of Equipment Sub-total (II) 1 July 1992 to 30June 993 HK$O:, 27,675 30,864 240 145 1,485 1,401 638 738 63,186 133,023 20,665

n

694 8,215 21155 L 79,615 369:215

(27)

9. EXPENDITURE (Cont’d) I July 1991 I July 1992 to to 305 L;‘ooa 30 June 993 ,K$‘O:, 5,724 17,400 1,172 356 8,497 1,030 1,394 1,451 149 11,480

MAINTENANCE OF PREMISES AND GROUNDS ’ Salaries and Gratuities/Superannuation-Senior Staff Salaries and Gratuities/Superannuation-Support Staff Cleaning Expenses

General Off ice Expenses Minor Works

Rates

Repairs and Maintenance Security Expenses Staff Uniforms and Laundry Utility Charges Sub-total (III) 8,922 36,242 8,190 608 8,716 10,932 13,732 5,060 535 24,363 48,653 601 3,039 5,171 4,400 60 6,220 25 629 20.145 60 49 4,471 732 5,312 Sub-total (V) 12,240 329 1,697 198 27,209 569 3,460 402 47 939 3,903 1,243 68 711 1.022 41.797 Sub-total (VI) 58,509 117.300 GENERAL EDUCATION

Advisory Committees Meetings/Accreditation Consultancies

Contractual Passages

Duty Visits and Staff Development Examinations

Postgraduate Studentships

Subscriptions to International Education Associations Workshops and Seminars

Sub-total (IV) 746 5,593 7,868 6,372 54 16,458 46 1,501 38,638

STUDENT FACILITIES AND AMENITIES Grants to Student Bodies

Physical Education Facilities Student Affairs Off ice Student Health

MISCELLANEOUS Council Meetings Education Allowances General Off ice Equipment Housing Benefits Insurance Premiums Medical and Dental Benefits Official Entertainment

Outreach Programmes to Schools Publicity Expenses

Recruitment Expenses

Removal Expenses and Hire of Vehicles School Passages

Subsidies for Staff Buses Miscellaneous 85 108 10,717 1,330 206 2,913 0 38,133 1,164 6,053 436 26 1,054 4,968 1,738 107 873 838 328.219 TOTAL (l)+(ll)+(lll)+(lV)+(V)+(VI) 659,088

(28)

THE HKUST STAFF SUPERANNUATION SCHEME

(29)

TRUSTEES’ REPORT

The Hong Kong University of Science and Technology Staff Superannuation Scheme (“the Scheme”) was introduced from 1 July 1992. The main purpose of the Scheme is to provide a lump-sum cash retirement benefit for The Hong Kong University of Science and Technology (“HKUST”) staff members who are eligible to participate in the Scheme.

2. The Scheme has been constituted under a Deed of Trust and individual Trustees are appointed by the University Council. As at the end of the financial year there were seven Trustees who together formed a Board of Trustees:

Chairman: The Hon. LAU Wah-sum Members: Prof. CHEN Jay-chung

Mr. CHENG Hon-kwan Mr. LEE Hon-chiu Mr. PANG Tak-ming Mr. TAN Chuen-yan, Paul Prof. WOO Chia-wei

While Messrs. Lau Wah-sum, Cheng Hon-kwan, Lee Hon-chiu, Tan Chuen-yan, Paul and Prof. Woo Chia-wei were appointed directly by the University Council, the appointments of Prof. Chen Jay-chung and Mr. Pang Tak-ming were made on the basis of the results of elections which were open to all eligible Scheme Members.

3. During the first year of the Scheme’s operation, the Trustees have appointed two investment managers (AEtna Investment Management (Hong Kong) Limited and Barclays de Zoete Wedd Investment Management (Hong Kong) Limited) to manage the assets of the Scheme, Bermuda Trust (Far East) Limited as the Scheme Administrator, and Towers Perrin to advise on investment and scheme administration matters. Following the recommendation of the Trustees, the University Council has also appointed Towers Perrin as the Scheme Actuary until 30 June 1994.

4. The Scheme is structured on a defined contribution basis for the first 6 years of a Scheme Member’s service, and moves to a defined benefit formula thereafter. As at the end of the financial year, the total net assets of the Scheme was $16.67 million, of which $16.01 million was HKUST and Members’ Balances. The Scheme has a General Reserve which stood at $0.66 million as at 30 June 1993. The total number of Scheme Members as at the end of the financial year was 692. Of this, 9 and 683 were otherwise Terms A and Terms B staff members of HKUST respectively.

5. As HKUST continues to expand its staff members during 1993/94, and with staff members gradually completing their 2- or 3-year employment contracts and moving to the Scheme, it is envisaged that both the assets of the Scheme and the number of Scheme Members will grow rapidly.

6. Taking this opportunity, the Board would like to thank all parties involved in the successful introduction and the subsequent management of the Scheme for their advice and contributions during the year.

Board of Trustees, 13 October 1993

(30)

AUDITORS’ REPORT

To: The Trustees of The HKUST Staff Superannuation Scheme

We have audited the financial statements of THE HONG KONG UNIVERSITY OF SCIENCE AND TECHNOLOGY STAFF SUPERANNUATION SCHEME on pages 31 to 34 in accordance with Auditing Standards.

2. In our opinion, the financial statements show a true and fair view of the disposition of the net assets of the Scheme at 30 June 1993 and of its transactions for the year then ended.

3. In our opinion, the contributions payable to the Scheme during the year have been paid in accordance with the scheme rules and with the recommendation of the actuary.

SIGNED

13 October 1993

(31)

INVESTMENTS

CURRENT ASSETS Bank Balances

LESS: CURRENT LIABILITIES Accounts Payable NETCURRENTASSETS NET ASSETS HKUSTBALANCE 12,004 MEMBERS' BALANCE 4,001 BALANCE SHEET AS AT 30 JUNE 1993 GENERAL RESERVE TOTALFUNDS

Approved by the Board of Trustees on 13 October 1993

SIGNED Chairman, Board of Trustees

The accompanying notes are an integral part of the financial statements.

Note jiK%'OOO HK$'000 3 15,004 1,767 104 1,663 16,667 16,005 SIGNED Secretary, Board of Trustees 662 16,667

(32)

REVENUE ACCOUNT

CONTRIBUTIONS AND WITHDRAWALS HKUST Contributions

Members’ Contributions

Interest Credited to HKUST Balance and Members’ Balance

Less: Withdrawals of Contributions and Interest on Members Leaving Service of HKUST Forfeitures of Contributions and Interest on

Members Leaving Service of HKUST

NET AMOUNT TRANSFERRED TO HKUST BALANCE AND MEMBERS’ BALANCE

INCOME AND EXPENDITURE INCOME

Forfeitures of Contributions and Interest on Members Leaving Service of HKUST Bank Interest

Investment Income Profit on Sale of Investments

Unrealized Gain on Revaluation of Investments

LESS: EXPENDITURE Audit Fee Actuary’s Fee

Scheme Administration Fee Other Professional Fees

Investment Managers’ Fee and Expenses Death and Disability Insurance Premium

Interest Credited to HKUST Balance and Members’ Balance Loss on Exchange

EXCESS OF INCOME OVER EXPENDITURE TRANSFERRED TO GENERAL RESERVE

TOTAL FUNDS 16,667

JiK$‘OOO HKS’000 16,683 678 16,005 508 136

q

38 456 137 1,275 3 19 17 57 13 305 188 11 613 662

(33)

30 JUNE 1993

1. BACKGROUND

The Hong Kong University of Science and Technology Staff Superannuation Scheme (“the Scheme”) was established with effect from 1 July 1992 under a Deed of Trust. The Scheme starts on a defined contribution basis and moves after six years of a Scheme Member’s service to become a defined benefit scheme, with both staff members and The Hong Kong University of Science and Technology (“HKUST”) contributing to the Scheme.

2.1 Investments

Listed investments are stated at market value. All gains and losses arising from revaluation of investments are recorded in the Revenue Account.

2.2 Interest and Investment Income

Income from fixed interest investments and bank deposits is accounted for on the accrual basis. Dividend income is accounted for when declared.

2.3 Foreign Currencies

Foreign currency balances have been translated into Hong Kong dollars at the market rates of exchange ruling at the balance sheet date. Foreign currency transactions during the year were translated into Hong Kong dollars at the rates ruling at the transaction dates. Differences arising on transactions in and translation of foreign currencies are dealt with in the Revenue Account.

(34)

3. INVESTMENTS AEtna Investment Management (Hong Kong) Limited Barclays de Zoete Wedd Investment Management (Hong Kong) Limited TOTAL

HK$‘OOO HK$‘OOO HK$‘OOO EQUITIES (DIRECT INVESTMENT)

Hong Kong

South East Asia Excluding Hong Kong North America

EQUITIES (UNIT TRUSTS)

Hong Kong

South East Asia Excluding Hong Kong Japan

North America Europe

BONDS (DIRECT INVESTMENT)

Japan

BONDS (UNIT TRUSTS)

North America Europe Global CASH 1,163 263 1,426

m pig i

1,367 5,069 6,b36 401 401 401 401 jl j r?J jl j r?J 1,057 1,057 (940 (940 21997 21997 7,732 7,272 15,004

(35)

ACTUARIAL CERTIFICATE

Name of Scheme : THE HKUST STAFF SUPERANNUATION SCHEME

Principal Employer : THE HONG KONG UNIVERSITY OF SCIENCE AND TECHNOLOGY

Effective Date of this Certificate : 30 JUNE 1993

An actuarial review of the above Scheme has been conducted as at 30 June 1993. The valuation included a valuation of the Scheme’s liabilities (including contingent and prospective) and due regard was given to the financial condition of the Scheme. A recommendation has been given as to the contributions to be payable after the valuation date in a report dated September 1993.

Part 1 Security of vested rights

As at the Effective Date the ratio of the assets to the aggregate vested liabilities of the Scheme was 4.03. The amount of surplus at the Effective Date was HK$12.5 million.

Part 2 Security of accrued rights

As at the Effective Date the ratio of the assets to the aggregate past service liabilities of the Scheme was 1.16.

Part 3 Security of prospective rights

In my opinion the resources of the Scheme are likely in the normal course of events to meet in full the liabilities of the Scheme as they fall due.

In giving this opinion, I have assumed that the following amounts will be paid to the Scheme:

by Members : 5.0% of salaries

by the Employer : 15.0% of salaries

Part 4 Undertaking

I confirm that I have received a written undertaking from the Principal Employer that contributions shall be paid in accordance with the recommendations in the valuation report referred to above.

Signature : SIGNED Date : 6 October 1993

Name : Sydney Maurice Bone

Qualification : Fellow of The Institute of Actuaries of Australia Address : Towers Perrin

131 O-l 313 Two Pacific Place 88 Queensway

Hong Kong

(36)

THE HKUST ANCILLARY STAFF SUPERANNUATION SCHEME

(37)

TRUSTEES’ REPORT

The Hong Kong University of Science and Technology Ancillary Staff Superannuation Scheme (“the Scheme”) was introduced from 1 July 1992. The main purpose of the Scheme is to provide a lump-sum cash retirement benefit for The Hong Kong University of Science and Technology (“HKUST”) staff members who are eligible to participate in the Scheme.

2. The Scheme has been constituted under a Deed of Trust and individual Trustees are appointed by the University Council. As at the end of the financial year there were seven Trustees who together formed a Board of Trustees:

Chairman: The Hon. LAU Wah-sum Members: Mr. CHENG Hon-kwan

Mr. LEE Hon-chiu Mr. LEUNG Kwok-leung Mr. LEUNG Tit-ming Mr. TAN Chuen-yan, Paul Prof. WOO Chia-wei

While Messrs. Lau Wah-sum, Cheng Hon-kwan, Lee Hon-chiu, Tan Chuen-yan, Paul and Prof. Woo Chia-wei were appointed directly by the University Council, the appointments of Messrs. Leung Kwok-leung and Leung Tit-ming were made on the basis of the results of elections which were open to all eligible Scheme Members.

3. During the first year of the Scheme’s operation, the Trustees have appointed two investment managers (AEtna Investment Management (Hong Kong) Limited and Barclays de Zoete Wedd Investment Management (Hong Kong) Limited) to manage the assets of the Scheme, Bermuda Trust (Far East) Limited as the Scheme Administrator, and Towers Perrin to advise on investment and scheme administration matters. Following the recommendation of the Trustees, the University Council has also appointed Towers Perrin as the Scheme Actuary until 30 June 1994.

4. The Scheme is non-contributory and is structured on a defined benefit basis. As at the end of the financial year, the total net assets of the Scheme was $1.35 million. The total number of Scheme Members as at the end of the financial year was 163, all of whom were otherwise Terms C staff members of HKUST.

5. As HKUST continues to expand its staff members during 1993/94, it is envisaged that both the assets of the Scheme and the number of Scheme Members will continue to grow. 6. Taking this opportunity, the Board would like to thank all parties involved in the successful introduction and the subsequent management of the Scheme for their advice and contributions during the year.

Board of Trustees, 13 October 1993

(38)

AUDITORS’ REPORT

To: The Trustees of The HKUST Ancillary Staff Superannuation Scheme

We have audited the financial statements of THE HONG KONG UNIVERSITY OF SCIENCE AND TECHNOLOGY ANCILLARY STAFF SUPERANNUATION SCHEME on pages 41 to 44 in accordance with Auditing Standards.

2. In our opinion, the financial statements show a true and fair view of the disposition of the net assets of the Scheme at 30 June 1993 and of its transactions for the year then ended.

3. In our opinion, the contributions payable to the Scheme during the year have been paid in accordance with the scheme rules and with the recommendation of the actuary.

SIGNED

13 October 1993

(39)

BALANCE SHEET

AS AT 30 JUNE 1993

INVESTMENTS

CURRENT ASSETS Bank Balances

LESS: CURRENT LIABILITIES Accounts Payable

NET CURRENT ASSETS

NET ASSETS

SCHEME FUND BALANCE

Approved by the Board of Trustees on 13 October 1993

SIGNED Chairman, Board of Trustees

!!m!2 HK$‘OOO HK$‘OOO 3 1,221 146 13 133 1.354 1,354 SIGNED Secretary, Board of Trustees

(40)

REVENUE ACCOUNT

CONTRIBUTIONS RECEIVED FROM HKUST

INCOME AND EXPENDITURE INCOME

Bank Interest Investment Income Profit on Sale of Investments

Unrealized Gain on Revaluation of Investments

LESS: EXPENDITURE Audit Fee Actuary’s Fee

Scheme Administration Fee Other Professional Fees

Investment Managers’ Fee and Expenses Loss on Exchange

EXCESS OF INCOME OVER EXPENDITURE

SCHEME FUN0 BALANCE

HK$‘OOQ HK$‘OOO 1,316 7 3

u

37 11 58 3 2 a

1

5 1 1 20 38 1,354

(41)

30 JUNE 1993

1. BACKGROUND

The Hong Kong University of Science and Technology Ancillary Staff Superannuation Scheme (“the Scheme”) was established with effect from 1 July 1992 under a Deed of Trust. The Scheme is a defined benefit scheme, with only The Hong Kong University of Science and Technology (“HKUST”) making contributions.

2.1 Investments

Listed investments are stated at market value. All gains and losses arising from revaluation of investments are recorded in the Revenue Account.

2.2 Interest and Investment Income

Income from fixed interest investments and bank deposits is accounted for on the accrual basis. Dividend income is accounted for when declared.

2.3 Foreign Currencies

Foreign currency balances have been translated into Hong Kong dollars at the market rates of exchange ruling at the balance sheet date. Foreign currency transactions during the year were translated into Hong Kong dollars at the rates ruling at the transaction dates. Differences arising on transactions in and translation of foreign currencies are dealt with in the Revenue Account.

(42)

3 INVESTMENTS

EQUITIES (DIRECT INVESTMENT)

Hong Kong

South East Asia Excluding Hong Kong North America

EQUITIES (UNIT TRUSTS)

Hong Kong

South East Asia Excluding Hong Kong Japan

North America Europe

BONDS (DIRECT INVESTMENT)

Japan 33 33

BONDS (UNIT TRUSTS)

North America Europe Global CASH 94 24 118 AEtna Investment Management (Hong Kong) Limited HK%‘OOO ai 30 111 28

I

58 86 Barclays de Zoete Wedd Investment Management (Hong Kong) Limited HK%‘OOO 126 76 3 52 88 69 411

L-d

157 157 TOTAL HK$‘OOQ 522 243 629 592 1.221

(43)

ACTUARIAL CERTIFICATE

Name of Scheme : THE HKUSTANCILLARY STAFF SUPERANNUATION SCHEME

Principal Employer : THE HONG KONG UNIVERSITY OF SCIENCE AND TECHNOLOGY

Effective Date of this Certificate : 30 JUNE 1993

An actuarial review of the above Scheme has been conducted as at 30 June 1993. The valuation included a valuation of the Scheme’s liabilities (including contingent and prospective) and due regard was given to the financial condition of the Scheme. A recommendation has been given as to the contributions to be payable after the valuation date in a report dated September 1993.

Part 1 Security of vested rights

As at the Effective Date the assets exceeded the aggregate vested liabilities of the Scheme. The amount of surplus at the Effective Date was HK$1.35 million.

Part 2 Security of accrued rights

As at the Effective Date the ratio of the assets to the aggregate past service liabilities of the Scheme was 180%.

Part 3 Security of prospective rights

In my opinion the resources of the Scheme are likely in the normal course of events to meet in full the liabilities of the Scheme as they fall due.

In giving this opinion, I have assumed that the following amounts will be paid to the Scheme:

by Members : 0% of salaries by the Employer : 15.0% of salaries

Part 4 Undertaking

I confirm that I have received a written undertaking from the Principal Employer that contributions shall be paid in accordance with the recommendations in the valuation report referred to above.

Signature : SIGNED Date : 6 October 1993

Name : Sydney Maurice Bone

Qualification : Fellow of The Institute of Actuaries of Australia Address : Towers Perrin

131 O-l 313 Two Pacific Place 88 Queensway

Hong Kong