International funds and fund management survey
Investment institutions must maintain books and records, including a balance sheet, and profit and loss account annually, in accordance with the Civil Code. Such books and records must be kept for a period of 10 years in such a manner that the rights and obligations of the investment institution are readily ascertainable at all times. However, there is no specific requirement to maintain such books within Curacao.
An investment institution that has not obtained an applicable exemption or dispensation under the National Ordinance on the Supervision of Investment Institutions and Administrators (NOSIIA) is required to submit annual financial statements certified by an external auditor to its participants within a period of four months after the close of the book year. At the same time, a copy of the audited financial statements, annual report, and a management letter should be submitted to the Central Bank of Curacao and Sint Maarten (Central Bank). In addition, every such investment institution must disclose to its investors its semiannual figures within two months of the end of the first half year, and provide a copy to the Central Bank.
Investment institutions may under circumstances choose their own year-end. Unless the articles of association provide otherwise, the accounting period of an investment institution is equal to the calendar year. If the investment institution wishes to change the accounting period this should be done in accordance with the articles of incorporation and with approval of the tax inspector. Investment institutions that are under the supervision of the Central Bank need prior approval of the Central Bank to amend their financial year.
Comparative information requirements are governed by the accounting standards used. The form in which the annual financial statements have to be drawn up, the successive points in time which they relate to, and the times within which they are to be submitted, are determined by the Central Bank after consultation with the representative organizations appointed under the NOSIIA and are presently laid down in the Central Bank’s Directives on the Supervision of Investment Institutions and Administrators dated January 2003.
There is no legal restriction on the currency under which financial statements must be prepared – this is governed by the accounting standards chosen. The financial statements that are submitted to the tax inspector (if applicable) should be in a local or major currency (ANG, USD, or EUR).
There are no specific accounting considerations for umbrella schemes.
Financial statements are required to incorporate all classes of shares. It is not required that separate financial statements are produced for each class of share.
An auditor’s report has to be included with the financial statements of funds that have not obtained an applicable exemption or dispensation under the NOSIIA.
If a fund is incorporated in a limited liability company (naamloze vennootschap) and is considered as large in the meaning of the Civil Code, the financial statements should be audited and made available for interested parties. This civil law requirement does not apply to funds incorporated as other types of legal entities, and to funds that have no legal personality.
The following regulatory requirements apply to investment institutions, irrespective of their corporate status, that have not obtained a Central Bank dispensation or exemption of these following stipulations. A dispensation or exemption of part of these stipulations may be obtained from the Central Bank under certain circumstances.
All recognized GAAP can be used for preparing the financial statements.
The financial statements should have all the disclosures necessary under the GAAP adopted by the investment institution.
Investment institutions should have a prospectus. The prospectus of an exempt institution should mention the exempt status and that the institution is therefore not subject to Central Bank supervision. A licensed investment institution must, prior to any public solicitation, have a prospectus available that meets Central Bank conditions and has been reviewed by the Central Bank.
In addition to the disclosures mentioned above, if a licensed investment institution exerts, or can exert, a significant degree of influence on an investment, a specified statement of the investments of the investment institution in which it exerts, or can exert, a significant degree of influence on the commercial and financial policy must be disclosed to the (potential) investors.
The following details the relevant laws and regulations for investment institutions and provides web addresses (in certain instances) where this material can be located.
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