The CEAP Retirement Plan held its 6th Assembly last September 13, 2005 at the Serenade & Granada Rooms of the Grand Men Seng Hotel in Davao City, a day ahead of the CEAP National Convention held at the NCCC Mall, also in Davao City, from September 14-16, 2005.

The objective of this year's Assembly was to update the Participating Employers on: systems upgrade on fund administration and Retirement Office business processes; Fund Performance for the fiscal year ended June 30, 2005; retirement program cost and proper accounting based on IAS 19; legal issues pertaining to retirement, termination and withholding tax and SSS implications; impact on CEAP school's future tuition fee increases in the light of G.R. No. 155609 - St. Joseph's College vs. St. Joseph's College Worker's Association (Samahan) as well as create awareness and linkages with the Fund's members and financial partners.

Mr. Renato L. Aseneta, CEAP Retirement Plan Office Director, welcomed the delegates and did the emceeing chores as well. It formally opened with an invocation led by Sister Lioba Tiamson, OSB, Chair of the CEAP Retirement Commission followed by the keynote address of Fr. Roderick C. Salazar, Jr., SVD - CEAP President.

Fr. Salazar's message centered on this year's theme - Towards Creating Stakeholder Value - wherein the thrust was to adopt an integrated marketing and business strategy to encourage the Plan's members and potential participants within the CEAP matrix to be pro-active in the Plan's programs and activities. The goal is for the Retirement Plan to be the "benchmark" of private school's retirement plans and he emphasized that this can be done by giving the stakeholders more than the usual - through better financial returns and prudent investment policies, better financial communications, community relations and scholarship programs, improved fund administration services and expanded benefits such as additional total disability benefit, multi-purpose loan and group life insurance.

Mr. Angel Buñag, managing Director of Investor Relations Global Inc., discussed the link-up PRODEX micro, small and medium scale enterprise development program as a corporate social responsibility offering for the Plan's members nationwide. He informed the Assembly that at no cost to CEAP, students, teachers, school workers and their families can earn extra income from identified and assisted micro enterprises and they can be given additional on-the-job training and allowances, as well, for assisting as survey and research fieldworkers or in helping in the supervision and monitoring of start-up micro businesses.

A Philippine Economic Financial Situationer was presented by Mr. Frederico Rafael D. Ocampo, Chief Investments Officer of Deutsche Bank AG. According to him, Asian prospects look good, with China and India spearheading world growth in 2006. The Philippines' GDP peaked in 2004, registering an 8-year high 5.7% growth. Consumption was driver of growth as overseas remittances surged to US$8.5 billion in 2004. Job creation was sustained on account of political stability, level playing field, confidence factor and liberalization of sector, such as mining. He also stressed that while inflation is a concern, which rose to 8.1% in first 7 months of 2005, prices have actually fallen. Fiscal reforms improved outlook with the passing of sin and lateral tax laws while Debt/GDP ration plunged from 5.5% in 2002 to a forecasted 1.9% in 2006. On the heel of fiscal reforms, 91-day T-Bill rates plunged from 22% in 1982-1985 to 6% in 2001-2005, on account of political stability, level of budget deficit, tax administration, passage of reform agenda and access to international capital. Overall, the prognosis remains positive with economic and financial indicators on the uptrend.

In his report on the Fund's performance for the fiscal year ended June 30, 2005. Mr. Aseneta happily informed the delegates that the Fund's total assets has reached P1.923B while Member's Fund was pegged at P1,879B. Contributions amounted to P259.1M while benefit payments reached P90.8M, benefiting 914 members, inclusive of 33 beneficiaries of deceased members. Majority of the Fund equivalent to P1.809B, is invested in peso/dollar fixed income instruments. He also indicated that the Fund generated a total income of P189.9M, out of which P167.6M was allocated to individual member's equities. It realized an ROI of 10.18% p.a., net of fees, based on realized unrealized earnings of P167.6M

Mr. Lyndon Fadri, Executive Vice President of Feliciano F. Miravite, Inc.,, talked about Retirement Cost Accounting under IAS 19. He shared with the delegates how CEAP participating employers will be affected by the new accounting standard, causes of funding shortfall and shortfall provisioning. He also emphasized the importance of recognition of expense and liability under IAS 19. He also stressed the need for an actuarial valuation for better monitoring and cost control.

The topic discussed by Atty. Sabino Padilla, Jr., CEAP Legal Counsel, focused on St. Joseph's College case (G.R. No. 155609) and its implication on CEAP school's future tuition fee increases. He discussed and offered clarifications with the delegates the decision of the 3rd Division of the Supreme Court wherein it clarified in the sense that 70% of the tuition fee increase should be "allotted for the teaching and non-teaching personnel", not necessarily for an increase in personnel compensation.

The Assembly concluded with a Synthesis presented by Ms. Gloria C. Garrovillo, a Retirement Commission Member. She also emphasized the Plan's strategic objectives, action plans and strategic linkages.

Last January 21, 2005, the CEAP entered into a joint venture with First Metro Investment Corporation (FMIC) and Marist Development Foundation (MDF) to put up an asset management company to manage Mutual Funds, with the CEAP and Marist stake at 15% each. The asset management company, known as the First Metro Asset Management Inc. (FAMI), was incorporated on April 21, 2005 with an authorized capital of P40M and a paid-up capital of P10M. It has already secured the required licenses from the Securities and Exchange Commission last September 2, 2005. The CEAP has 2 board seats, represented by Fr. Roderick C. Salazar, Jr., SVD and Mr. Jose M. Santos, Treasurer of Ateneo de Manila University.

The Mutual Funds will be called the Save and Learn Fixed Income Fund and the Save and Learn Equity Fund. The former, with an initial size of P50M, was incorporated last June 3, 2005 and its investments criterion will be in Philippine government securities and prime corporate bonds while the latter, incorporated on May 27, 2005 with an initial fund size of P25M, will make investments in publicly traded Philippine stocks.

What's in it for CEAP? First, it will provide CEAP member school's employees and their families with an additional mechanism to save for their future and an avenue for better financial returns on their personal savings; second, the Plan's retirees can re-invest some of the proceeds of their retirement benefits back to the mutual find and avoid "get rich quick schemes"; and third, since there is a direct link between the creation and promotion of mutual funds and economic activity in general, the CEAP can therefore have direct hand in the development of capital markets and in spurring economic development in the Philippines.

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The CEAP Retirement Plan Office is presently coordinating and working with a business process outsourcing (BPO) provider for retirement fund administration to provide the backroom service, in line with the Retirement Fund's internal auditor's recommendation of identifying back office automation as a "must do" to provide the Plan with the administrative backbone for effective and efficient service. This BPO provider, a SAS 70 compliant, is also capable of providing web-based services that will help improve the Plan's subsidiary ledger administration in terms of accessibility, frequency and reliability of reports.

Plans have been put forward to improve the Retirement Office's information technology capability where participating employers and members can look forward to:

• a faster processing of claims/benefits of individual members;
• immediate and more efficient response to online inquiry on benefit application status as well as basic membership information; and
• a more secure and reliable databases for accurate financial reporting and a more efficient and integrated work systems.
  

Likewise, the Office will heighten its focus and emphasis in the regional levels, where Regional Directors/Superintendents or their representatives can participate actively in areas of marketing, financial communication, scholarship programs and community relations program by way of seminars, orientation and training modules to be prepared and developed by the Retirement Office. In this manner, it will help magnify its presence in the regions several fold and queries about the Plan and its related activities and programs can readily be addressed in the regional / local levels.

These improvements are expected to be operational by the 2^nd quarter of 2006.

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