Approved pooled investment fund ('APIF')

A collective investment scheme approved by the MPFA pursuant to the MPF Ordinance for investment by registered schemes. Such registration or approval does not imply official recommendation.

Asset switch

To switch all or some of the units from one fund or funds and then re-allocate the redeemed amounts to another fund or across any of the funds. The investment allocation of your new contributions (including but not limited to accrued benefits transferred from another registered scheme) will remain unchanged.

Back-payment

Any payments made to an employee relating to an earlier period arising from a salary adjustment or a time lag for ascertaining the payment amount.

Bid Price

Bid price is the transaction price for redeeming units in a Constituent Fund after fees and charges are deducted from the net asset value per unit of the fund (if applicable).

Casual employee

Employees who are engaged in the construction or catering industries, and are employed on a day-to-day basis or for a short-term fixed period of less than 60 days, and aged between 18 and 65.

Class

A mechanism to distinguish between employees with different benefits in respect of the employer's additional voluntary contributions.

Contribution day

The day by which an employer is required to pay mandatory contributions for their employees (or by which a self-employed person must make his/her mandatory contributions) to the trustee of the relevant MPF scheme.


1. For non-casual employees - the 10th day after the last day of a calendar month within which the contribution period ends (or the 10th day after the last day of the month during which the permitted period ends if this is a later date).
2. For casual employees under Master Trust Schemes - the 10th day after the last day of the contribution period (or the 10th day after the last day of the contribution period during which the permitted period ends if this is a later date).
3. For self-employed persons - the last day of the contribution period.
If the contribution day falls on a Saturday, a public holiday, or a gale/black rainstorm warning day, then the next day (which is not a Saturday, a public holiday, or a gale/black rainstorm warning day) should be taken as the contribution day.

Contribution period

The period for which relevant income is paid to employees.

Contribution redirection

To change the investment allocation of your new contributions (including but not limited to accrued benefits transferred from another registered scheme). The investment allocation of your existing investments will remain unchanged.

Constituent Fund

Fund that constitutes the MPF scheme, or a fund that forms part of the MPF scheme.

 

Default Investment Strategy (‘DIS’)

A ready-made investment arrangement mainly designed for those members who are not interested or do not wish to make an investment choice, and is also available as an investment choice itself, for members who find it suitable for their own circumstances. For those members who do not make an investment choice, their contributions and accrued benefits transferred from another Registered Scheme will be invested in accordance with the DIS.

The DIS aims to balance the long term effects of risk and return through investing in two Constituent Funds, namely the Core Accumulation Fund and the Age 65 Plus Fund, according to the pre-set allocation percentages at different ages. The DIS will manage investment risk exposure by automatically reducing the exposure to higher risk assets and correspondingly increasing the exposure to lower risk assets as the member gets older.

For further details of the DIS, please refer to the relevant MPF Scheme Brochure.

Financial year

The financial year of Hang Seng MPF scheme is from 1 July to 30 June.

Non-casual employee

Employees (other than casual employees) aged between 18 and 65 and employed for 60 days or more under a continuous contract of employment.

ORSO

ORSO* scheme is a voluntary retirement scheme established by employers as part of their employee benefit programme.


* Occupational Retirement Schemes Ordinance

Offer Price

Offer price is the transaction price for acquiring units in a Constituent Fund inclusive of fees and charges marked up on the net asset value per unit of the fund (if applicable).

Pay centre

A mechanism for grouping employees who share same common characteristics such as member type, payroll frequency, payment arrangement, working location or contact person.

Permanent departure

A member departs from Hong Kong permanently if the member departs from Hong Kong to reside elsewhere with no intention of returning for employment or to resettle in Hong Kong as a permanent resident. A member is entitled to be paid accrued benefits on the ground of permanent departure from Hong Kong only once in a lifetime , except as permitted by the Mandatory Provident Fund Schemes (General) Regulation.

Permitted period

For non-casual employees – 60 days
For casual employees under master trust schemes – 10 days
For self-employed persons – 60 days

Personal account

An individual account held in a member's name to preserve his/her accrued benefits accumulated from any previous employment or self-employment, and his/her accrued beneftis transferred from his/her own employee’s mandatory contributions made under the current employment.

Portfolio rebalance

To change the investment allocation of your existing investments and new contributions (including but not limited to accrued benefits transferred from another registered scheme). Necessary units will be redeemed to rebalance the portfolio of your existing investments.

Prescribed savings rate

A rate prescribed by Mandatory Provident Fund Schemes Authority on a monthly basis as the interest rate payable in respect of a Hong Kong dollar savings account or the average of the interest rates payable by different authorised financial institutions on Hong Kong dollar savings accounts. If the investment return of an MPF Conservative Fund does not exceed the prescribed savings rate in a month, no administrative expense is allowed to be deducted from the fund for that month.

Relevant income

If you are an employee, this includes wages, salaries, leave pay, housing allowances, housing benefits, fees, commissions, bonuses, gratuities, perquisites, or allowances expressed in monetary terms, paid or payable by an employer (directly or indirectly) to you, and in consideration of your employment contract, but excluding long service payments or severance payments.
If you are a self-employed person, your relevant income is defined as the assessable profits stated in your most recent Notice of Assessment.

Remittance statement

A statement detailing employees' relevant income, mandatory and, if any, voluntary contributions for each contribution period. It must be submitted to the trustee with each contribution payment.

Reserve account

Only available if employer's voluntary contributions are made and/or employer's ORSO* balances were transferred to the MPF scheme and they are subject to a vesting scale. Any benefits not entitled to employees upon employment termination will be treated as unvested benefits and transferred to this account. The funds in this account belong to employers.

* Occupational Retirement Schemes Ordinance

Risk class

The risk class is introduced with the objectives to promote understanding of the relative risks between Constituent Funds and to facilitate comparison of Constituent Funds within and across Registered Schemes by scheme members. It is defined using a 7-point risk classification with risk class “1” representing the lowest price volatility and risk class “7” representing the highest price volatility in terms of the annualised standard deviation based on the monthly rates of return of the Constituent Fund over the past three years.


Risk Class	Risk Indicator
	Equal or above	Less than
1	0.00%	0.50%
2	0.50%	2.00%
3	2.00%	5.00%
4	5.00%	10.00%
5	10.00%	15.00%
6	15.00%	25.00%
7	25.00%


Risk rating

The risk rating is defined using a 5-point risk scale with risk rating “1” representing the lowest risk and risk rating “5” representing the highest risk. The risk rating is derived based on a combination of quantitative and qualitative risk factors including price volatility, asset allocation and liquidity. The risk ratings for the Age 65 Plus Fund and the Core Accumulation Fund are derived based on the available historical data of the funds and the respective underlying indices of the industry recognised reference portfolio of the funds, while the same risking rating mechanism as all other Constituent Funds has been applied.


1 = Low Risk – Minimal chance of losing a significant portion of your capital over the term of the investment (although this is not guaranteed). Expected to demonstrate minimal price fluctuations over short periods of time.
2 = Low to Medium Risk – Low chance of losing a significant portion of your capital over the term of the investment (although this is not guaranteed). Expected to demonstrate moderately low level of price fluctuations over short periods of time.
3 = Medium Risk – Moderate chance of losing a significant portion of your capital over the term of the investment (although this is not guaranteed). Expected to demonstrate moderate level of price fluctuations over short periods of time.
4 = Medium to High Risk – Moderately high chance of losing a significant portion of your capital over the term of the investment. Expected to demonstrate moderately high level of price fluctuations over short periods of time.
5 = High Risk – High chance of losing a significant portion of your capital over the term of the investment. Expected to demonstrate high level of price fluctuations over short periods of time.

Self-employed person

Self-employed person is a sole proprietor or a partner in a business, or someone who works for himself/herself and is not employed as an employee.

Small balance

To make a claim for this reason the member's accrued benefits must not exceed HKD5,000, and he/she is required to make a statutory declaration that:



1. as at the date of the claim, at least 12 months have elapsed since the contribution day in respect of the latest contribution period for which a mandatory contribution is required to be made to any registered scheme,
2. there are no accrued benefits in any other registered scheme, and
3. he/she has no intention to be employed or self-employed.

Statutory declaration

In Hong Kong, the statutory declaration must be made before and signed by a Commissioner for Oath at either the Public Enquiry Service Centre of the Home Affairs Department, a Notary Public or a Justice of the Peace. A statutory declaration made in a place other than Hong Kong is also acceptable provided that it is made before and signed by a Notary Public or a person authorised under the law of that place to administer an oath or take a statutory declaration.

Surcharge

A late charge imposed on employers or self-employed persons who fail to pay mandatory contributions by the contribution day. This surcharge is calculated at 5% of the contribution amount in arrears, and monies received are credited to the MPF accounts of the employees/self-employed persons concerned.

 

Tax deductible voluntary contributions accounts

An individual account set up for any person who fulfils the eligibility requirements to pay tax deductible voluntary contributions (TVC). TVC contributed into the account will enjoy tax concession in accordance with the Inland Revenue Ordinance.

Terminal illness

A member who has an illness that is likely to reduce the life expectancy of the member to 12 months or less.

Total incapacity

A member who is permanently unfit to perform the kind of work that he/she was performing before becoming totally incapacitated.

Unvested benefits

Any benefits employees are not entitled to upon termination of employment.

Voluntary contributions

Any contributions above the mandatory contributions.