PRS Glossary

A to Z bookends

Glossary & Abbreviations

Term / Abbreviation Meaning
accrued benefits means the amount of a member’s beneficial interest in a PRS
auditor means an auditor registered under section 31O of the Securities Commission Act 1993
CMSA means the Capital Markets and Services Act 2007
collective investment schemes means, for the purpose of this study guide, schemes or any arrangement where–

  1. it is made for the purpose, or having the effect, of providing facilities for persons to participate in or receive profits or income arising from the acquisition, holding, management or disposal of securities, derivatives or any other property (referred to as “scheme’s assets”) or sums paid out of such profits or income;
  2. the persons who participate in the arrangements do not have day-to-day control over the management of the scheme’s assets; and
  3. the scheme’s assets are managed by an entity which is responsible for the management of the scheme’s assets and is approved/authorised/licensed by a relevant regulator to conduct fund management activities; and includes among others, unit trust funds, real estate investment trusts, exchange-traded funds, wholesale funds and closed-end funds
contribution means the amount paid by a contributor to the PRS
contributor means any person who contributes to a PRS and includes a member or an employer who makes contribution to a PRS on behalf of his employees
core funds core funds are mandatory funds that must be offered in each PRS and comprises the conservative fund, moderate fund and growth fund
default option core funds that will be selected automatically for a member who does not specify his or her fund option upon participating in a Scheme
eligible market means a market that–

  1. is regulated by a regulatory authority;
  2. operates regularly;
  3. is open to the public; and
  4. has adequate liquidity for the purposes of the fund in question
EPF means the Employees Provident Fund (Kumpulan Wang Simpanan Pekerja)
EPF Act means the Employees Provident Fund Act 1991
financial institution (a) if the institution is in Malaysia–

  • licensed bank;
  • licensed finance companies;
  • Islamic bank; or
  • licensed institutions

(b) if the institution is outside Malaysia, any institution that is licensed/registered/ approved/authorised to provide financial services by the relevant banking regulator

forward price means the price of a unit that is the NAV per unit calculated at the next valuation point after an instruction or a request is received
fund manager means a person who holds a Capital Markets Services Representative’s Licence to carry on the regulated activity of fund management
group of companies means any company and its related corporations
Government means the government of Malaysia
independent member In relation to the board of directors of a PRS Provider, the investment committee of a fund, the Shariah adviser and the panel of advisers, refers to a person who is free of any relationship with the PRS Provider or the controlling shareholder(s) of the PRS Provider that would otherwise interfere with the member’s or person’s exercise of independent judgment. In any case, a period of six months must elapse before a person who was previously connected to the PRS Provider or controlling shareholder(s) can be deemed to be independent. The following is a non-exhaustive list of persons who would not be considered as an “independent member”:

  1. An officer of the PRS Provider;
  2. An officer of the Scheme Trustee;
  3. An officer of any body corporate or unincorporate that has the power to appoint or make recommendations towards the appointment of the board of directors of the PRS Provider, members of the investment committee, the Shariah adviser and the panel of advisers of the fund;
  4. A person related to an officer of the PRS Provider or Scheme Trustee of the Private Retirement Scheme;
  5. A person representing or perceived to be representing any body corporate or unincorporate with a controlling interest in the PRS Provider; or
  6. A person who, within six months prior to his appointment as independent member, has derived any remuneration or benefit (other than retirement benefit) from the PRS Provider or any body corporate or unincorporate that has power to appoint or make recommendations towards the appointment of board of directors of the PRS Provider, members of the investment committee, the Shariah adviser and the panel of advisers of the fund
IRB means the Inland Revenue Board (Lembaga Hasil Dalam Negeri)
KWAP means the Retirement Fund Incorporated (Kumpulan Wang Persaraan [Diperbadankan]) 
LTAT means the Armed Forces Fund Board (Lembaga Tabung Angkatan Tentera)
member means an individual who has a beneficial interest under a PRS or an employer-sponsored retirement scheme
NAV per unit means the NAV of the fund divided by the number of units in circulation, at the valuation point
net asset value (NAV) means the value of all the fund’s assets less the value of all the fund’s liabilities at the valuation point.For the purpose of computing the annual management fee and annual trustee fee, the NAV of the fund must be inclusive of the management fee and trustee fee for the relevant day
non-core funds refers to the funds under a Scheme that are not core funds
ordinary resolution means a resolution passed by a simple majority of votes validly cast at a meeting of members of the Scheme or the fund (as the case may be)
portfolio turnover ratio (PTR) means the ratio of the average sum of acquisitions and disposals of the fund for the year to the average value of the fund for the year calculated on a daily basis, i.e.
formula
pre-retirement withdrawal means withdrawals from any fund under a Scheme that occurs prior to a member reaching retirement age and for the following reasons:

  1. Upon the death of a member; or
  2. Permanent departure of a member from Malaysia; or
  3. Withdrawal of any accrued benefits from sub-account B as maintained by PRS Providers for each member
Principal in relation to a PRS Consultant, means the PRS Distributor that the PRS Consultant represents
private pension account means an account opened and maintained by the Private Pension Administrator for each member
Private Pension Administrator (PPA) means a person who is approved under section 139Cof the CMSA to perform the function of record keeping, administration and customer service to members and contributors in relation to contributions made in a PRS and such other duties as may be specified by the SC
Private Retirement Scheme (PRS) or Scheme means a retirement scheme governed by a trust,offered and provided to the public for the sole purpose, or having the effect, of building up long term retirement for members
PRS Consultant means an individual PRS Consultant registered with FIMM to market and distribute PRS
PRS Distributor means any one of the PRS Providers, institutional PRS advisers and corporate PRS advisers registered with FIMM to market and distribute PRS
PRS Guidelines means Guidelines on Private Retirement Schemes
PRS Provider means a person who provides and manages a PRS
PRS Regulations means the Capital Markets and Services (Private Retirement Scheme Industry) Regulations 2012
retirement age means the age of 55 years or the compulsory age of retirement from employment as specified under any written law
SC means the Securities Commission Malaysia established under the Securities Commission Act 1993
Scheme Trustee means a trustee of a PRS
SOCSO means the Social Security Organisation (Pertubuhan Keselamatan Sosial)
special resolution has the same meaning as given under the PRS Regulations except for the purpose of terminating or winding up a private retirement scheme or fund (where applicable), a special resolution is passed by a majority in number representing at least 3/4 of the value of the units held by members voting at the meeting
sub-account A refers to a sub-account maintained by PRS Providers for each member which holds 70% of all contributions made to any fund under the Scheme which is reflected in units
sub-account B refers to a sub-account maintained by PRS Providers for each member which holds 30% of all contributions made to any fund under the Scheme which is reflected in units
vesting schedule refers to the schedule that determines the entitlement of an employee’s accrued benefits based on terms of service
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