TCI NIB Annual Report 2018 & 2019

ANNUAL REPORT 2018 & 2019



Office & Locations 4 CONTENTS Board of Directors 5 Committees of the Board 6 Management Team 7 Minister’s Remarks 8 Chairman’s Remarks 9 Operations Report 10 Key Performance Indicators 10 Contribution Income 10 New Registrations 11 New Insured Persons Registered By Period 11 12 Employers 12 New Employers By Industry 13 14 Benefits 16 Short Term Benefits 17 19 Compliance 25 Investment 26 Human Resources 27 Former Chairs of the Board of Directors 29 Former Director / CEOs 91 Statement On Internal Control 2018 Financial Statements 2019 Financial Statements

OUR MOTTO “We Are Because You Are!”

Vision Mission “The NIB will be the “To Be Fiscally Prudent Most Caring, in the Trusted, Provision of Dependable, Fiscally Sound Provider Transparent and Excellent of Social Security Services Social Security Services”. to our Beneficiaries.” CARING Core UNITY OF PURPOSE Values PROFESSIONAL RELIABLE INTEGRITY TRANSPARENT

OFFICES & LOCATIONS Head Office – Grand Turk Headley Durham Building P.O. Box 250 Church Folly Grand Turk Phone: (649)946-1045/8/9 Fax: (649)-946-1362 Email: [email protected] Providenciales Office Hon. Hilly A. Ewing Building 1292 Leeward Highway P.O. Box 283 Providenciales Phone: (649)941-5806/5906 Fax: (649)941-5854 South Caicos Office Lewis Cox Building Andrews Street Phone: (649)946-3280 Fax: (649)946-3664 North Caicos Office High Rock, Bottle Creek Phone: (649)946-7200 4

ANNUAL REPORT 2018 & 2019 BOARD OF DIRECTORS BOARD OF DIRECTORS NAME POSITION APPOINTMENT EXPIRY DATE DATE March 31, 2022 Samuel Swann Chairman April 1, 2017 Ezra Taylor Member April 1, 2017 March 31, 2020 Sharon Been Member April 1, 2017 March 31, 2020 Trevor Cooke Member October 1, 2016 September, 2018 Clayton Been Member April 1, 2017 March 31, 2019 Jamell Robinson Member April 1, 2017 March 31, 2019 Athenee Harvey PS Finance Darcel Smith-Thomas Member October, 2018 September 30, 2021 5

COMMITTEES OF THE BOARD COMMITTEES OF THE BOARD Audit Committee Chairman Oct 2016 - Sept 2018 Member Dec 2018 to Current Trevor Cooke NIB Chairman Sharon Been Chairman Samuel Swann Darcel Smith Budget Committee Tender Committee Jamell Robinson Chairman Samuel Swann Chairman Ezra Taylor Member Jamell Robinson Member Sharon Been Member Ezra Taylor Member Samuel Swann NIB Chairman CEO Ex-Officio Financial Controller Ex-Officio Human Resource Committee Investment Committee Jamell Robinson Chairman Samuel Swann NIB Chairman Clayton Been Chairman PS Finance Ex-Officio Trevor Cooke Member Jamell Robinson Chairman Grievance Committee Samuel Swann NIB Chairman Kenrick Walters Member Samuel Swann Chairman Sandy Lightbourne Member Audley Higgs Member Ms. Athenee Harvey PS Finance Investment Manager Ex-Officio CEO Ex-Officio Dr. Hubert Fulford Member Financial Controller Ex-Officio Pastor Bradey Handfield Member 6

ANNUAL REPORT 2018 & 2019 MANAGEMENT TEAM MANAGEMENT TEAM NAME POSITION Rhesa Cartwright Acting Director Financial Controller Marie Smith Investment Manager Diandra Mills Legal Counsel Internal Auditor Leroy Tull Information Technology Manager Richard Taylor Grand Turk Branch Manager Keith Jennings Providenciales Branch Manager Christa Quelch Marketing Manager Michael Dean Research and Business Process Analyst Dorean Williams Cherrie Ingham 7

Minister’s Remarks It is indeed an honor for me to address the various stakeholders of the National Insurance Board in this 25th Anniversary edition of your Annual Report. Firstly, I wish to congratulate the Board, management, and staff, both current and former members, for your outstanding service over the years. The National Insurance Board is considered one of our sterling local institutions. Its success continues to impact the socioeconomic fiber of our beloved country positively. Your growth over the twenty-five years of existence is evident throughout your organization. You have built a strong reserve, recruited, and invested in a dedicated and capable cadre of staff. You would have perfected aspects of your operations, which allows you to be viewed positively by the general public. I am pleased that the NIB continues to honor its obligations to its contributors and maintains a diversified investment portfolio that seeks to balances risk while pursuing an optimal return on your investments. I believe, however, that there is scope for the NIB to have a more significant impact on the economic scene of the Turks & Caicos Islands. The Board has already committed to conducting a review of its Domestic Investment Policy with the view of allowing greater participation and access to the funds allocated for local investments. I appreciate the current range of benefits offered by the NIB but noted the gap in coverage due to the absence of an Unemployment Benefit. To this end, the Board was charged with commissioning an actuarial study to explore the possibility of introducing an Unemployment Benefit. Wide stakeholder consultation is underway to engage the public about this and other parametric reforms. Once again, it is my privilege to congratulate you on this your 25th Anniversary and to encourage you to stay committed to the mission and vision of your institution, as you work to secure our social safety net. The Premier Hon. Sharlene Cartwright-Robinson (Minister) 8

ANNUAL REPORT 2018 & 2019 Chairman’s Remarks It gives me great pleasure to present to you the Annual Report of the National Insurance Board for fiscal years 2017/18 and 2018/19. I am honored to serve as Chairman of the Board of Directors as the institution commemorates its 25th Anniversary. My colleagues and I pause to recognize the services of former Boards and staff, and we thank you for your efforts in building an institution the current fiduciaries are proud to administer. This reporting period, the Board has made strides in the areas of governance and risk management, two very important areas for our maturing organization. Upon my appointment in 2017, the Board undertook an initiative to strengthen the institution’s governance framework. The Directors commissioned the development of a policy manual with properly established guiding principles and sound corporate governance processes to guide the conduct of the business of the Board. The Board and Management, also having an appreciation for the importance of having a proper system in place to manage risk, developed a risk management framework that identifies and mitigates key risk factors. The Board is committed to greater transparency. In an effort to keep the public informed, we commenced the publication of summaries of all Board meeting decision on our website. In accordance with Section 48(1) of the National Insurance Ordinance, I have the privilege of submitting to you, on behalf of the Board of Directors, the Annual Report of the National Insurance Board for the years 2017/18 – 2018/19. Included with this report are the accounts of the National Insurance Fund as certified by the Auditor, together with the report of the Auditor. Finally, I wish to register my sincere thanks to my colleagues, the management and staff of the National Insurance Board for another year of dedicated service to this noble institution. Samuel Swann 9

O2pSeHrUaDtWiLoRnQsVR5eHpSoRrUtW  Operations ReportAANNNNUUAALLRREEPPOORRTTFFYY22001188AANNDDFFYY22001199 O P E R A T I O N S R E P O R TK.ANeHy\\NUP3AeHLrUfIRoRErUPmPODaRnQTcFFeHY2I,0Qn1Gd8iLcFAaDNtWoRDrUFsVY2019 Tf7IKiLgJhKeuXeHyrUeHfIoRPsVlOlOfoIReoRwZrrUfiLo2nQ0gJrm1tW8aDa.bEnlOeHcpSerUoRInvYiLddGeHicsVarUteHosVruXslOtWsVfIoRrUkNeHy\\pSeHrUfIoRrUmPaDnQcFeHiLnQdGiLcFaDtWoRrUsVfIoRUr1N,I%BfIiLnQaDnQcFeHsViLnQ2019wZiLtWhKcFoRmPpSaDrUaDtWiLvYeH �The following table provides results for key performance indicators for NIB finances in 2%Cй01hŚ9aĂnŶwŐgithĞecomparative figures for 2018. IInnccoommee2318313388723887,,,,,,,3392803928Ϯ2004972204975086827Ϭ068270.,,,,,,,,ϭ1199242062406ϵ9%07449990749050404504  23115311555269562,,,,,,,550121502997959Ϯ9752125002840824Ϭ000,,,,,,,,.411380ϭ11803193170993179ϴ88%1176561576 %Cha-n2g6e.4% � ABIAATYAYBAAITTBInnnoodeedddeeddoedvvvttmamnmmanmmtnmeeeaaarereessslliiiiiilnnnnnnffnteteftCCCiimmimtttnnEEEEEsEssoooeeddexxxxxxnnxnEEEnnnppppppRRttptxxtrrtxtreeiiieeppaapabbaabnnsseesseununnuPWssPeennntdtddte%e%iieĞirreddoodovvOOrƌOr//iinnineettftĨoofuuBButtotŽssofhIIfhhIrrrnneenrƌeeCCeereeccnnmŵcmrrroooooeeIIInnmamĂamnffnniittttnŶccncrreeeiipopoocĐbbcmllmmeĞuueuuttsseeeIii/IoonŶnccnndĚdooiInŝInicnĐncttaĂcrcraiioobbtƚtoŽmmuuottrƌreeiioonn 282,020,944 259,195,406 --4206..584%%% Year end Reserves C&AAoRddnQmmtWrUiinniLbEEEuXxxtWiLppoReanQnssI,%eQncF/ooRBfmPeCnHeoenfittripbluutsiocnoInntcriobmuteion Income 3,308,290 5,590,191 -40.8% 5.9% faiT7IDLTnQoRhKhcFrUtW1oReHerU0eHtW2aDN1.NaD09lOsVDa1a%oRHeWt8tiLfIioRo/oR$1nQnvY39aDaeH7.OllrU.I,I9T72nQnM0hKV0ssXuiL1usViLUr7rnQDaa/Ur5Qn1ncFeH%Fc8oRcpSHe.enQrUeHtW%BBrUVsiLRobEoeHDauXanQUrtWrtWiLGdsVdoRnQFccRooiLDanQOllOllQnHceFeoRFcc8WtmPtHee%GdeHd C�4o0n,0t0r0ib,0u00tion IncomCCeoonnttrriibbuuttiioonn�IInnccoommee flaTIR,7HFDflTifaaonQanooRlIPOhKhtrWrcFcrrrthKQgeHgoerUrS99oRWeHeet2UO5Wap5uRXpDasLSaKs0E%lr%tg\\JrVsUstH1iXiLovHehHKveYc8WcafoGaoLsVDo/QosVotf$1tfWenJmPeWnHvwZt39RtFthther7.saDWrRVeHseiDerVibe.lOHbeQrUlO9THO2eH.utcFutcWoMFohL0ttWtQtoitWRoitrUi1naRnsXaFeHrUir7gnlUgRHlaDc/ccrcVQ1LlOcoeWiLosososVLW8oQnpUeWnnDeeHnLR.nFtErcttFcdGtieirOtnrtXnFtXirEoiosbubiWRuGiLbHrLenQrueuRXe,L,unQtstQQsitiiaDtJoioWtitWsoKtlOVntnlOooanHaWKILisVcicQnRbnbiaOeHHcncDFcUecencFocoURootWJVuouPomRmHt8HntmnrUhhHeO%VsVtetIeseesW,.. 40,000,000 �35,000,000 Contribution Income �3350,,000000,,000000 �324050,,,000000000,,,000000000 �223505,,,000000000,,,000000000 �213050,,,000000000,,,000000000 �112505,,,000000000,,,000000000 12�050,,,000000000,,,000000000 155,,000000,,000�0�00 cecTpHF7FScTeIanooRRxr[UohKlxhtoRcpSQnnQhpneHerMjeHWWtteHoeteirULrfInQnQfcFLiunaiuXEbubuXtWdGgdsnQXsuVnueHiLehidGtWWtdttuXLiusiRtoWoWtsorURiLrKhiQnsVeHmnsewDacF..sVaWtseoRtWT7ltTrvYiLlicFelO.lhKelHOhlRoeHrUeaDarQnetWeHLitiWtQnn99Urax[tWtFcLichKtWhEtpbSlhKhRoioeHseXueHPmmA$eAWntQsVLisdRocFHesVcetWtatWDQHenatuXuigJVsngaDaeHeLiXurUQnraLiiQnDaFcwZawllWtOlRolLiKhHeheOlPms5RHeR[xex2eFcUrHecHre0ecHeeHeeYv2vtHeoeLiiZWt7wtHeehKGdrhd.ZwsLiwHeVseOlsOl, 10,000,00-0 2019 2018 2017 2016 2015 2019 2018 2017 2016 2015 5,000,0P0ri0vate�Sector Civil�Servants Voluntary Pr-ivate Sector Civil Servants Self�Employed Voluntary Self Employed � � 2019 2018 2017 2016 2015 projects that contribution income will � SectorPrivate Sector 2019 2018Civil Servants Self Employed Voluntary 2017continue to 2co0v1e6r expenses u2n0ti1l 25027. Private Sector 34,935,870 32,384,607 29,265,197 27,251,478 24,469,381 Civil Servants 1,871,872 1,867,288 1,697,166 1,492,903 1,282,678 Self Employed 1,068,951 800,304 738,516 792,533 703,833 Voluntary 307 116 - 277 1,910 TOTAL 37,877,000 35,052,315 31,700,879 29,537,191 26,457,802 1� 0 PP aa gg ee �1111�||�223311� New Registrations P a g e 11 | 231

Private Sector 34,935,870 32,384,607 29,265,197 27,251,478 24,469,381 Civil Servants 1,871,872 1,867,288 1,697,166 1,492,903 1,282,678 Self Employed 1,068,951 Voluntary 800,304 7A3N8N,5U 1A 6L R E P O R7T922 ,051383& 2 0 1 9703,833 TOTAL 307 116 - 277 1,910 37,877,000 35,052,315 31,700,879 29,537,191 26,457,802 New Registrations NEW REGISTRATIONS New Insured Persons Registered By Period New Insured Persons Registered By Period ISLAND 2019 2018 Grand Turk 233 205 1,331 Providenciales 1,430 49 South Caicos 41 1 Salt Cay 2 37 1 North Caicos 23 1 Middle Caicos 2 16 - Pine Cay 1 1641 Parrot Cay 13 Ambergis Cay 2 TOTAL 1,747 P a g e 12 | 231 There were 1,763 new insured person registrations during the financial year 2018/19. Providenciales recorded 81% of the new registrations, with Grand Turk following with 13%. The other islands accounted for the remaining 6%. 11

Employers Number of New Employers in Period 576 452 NEW EMPLOYERS 2019 2018 Employers2018 2019 101 Grand Turk 84 16 Salt Cay 2 9 South Caicos 23 450 North Caicos 13 576 Providenciales 330 Total 452 New Employers By Industry P a g e 13 | 2 Group 2019 2018 7 4 Agriculture, forestry and fishing 2 8 Mining and quarrying 0 7 Manufacturing 3 3 Electricity,, gas, steam and air conditioning supply Construction 41 32 Wholesale and retail trade; repair of motor vehicles and motorcycles 52 48 Transportation and storage Accommodation and food service activities 1 4 Information and communication 41 33 Financial and insurance activities Real estate activities 0 1 Professional, scientific and technical activities 0 1 Administrative and support service activities 4 9 Education 32 15 Human health and social work activities 6 22 Arts, entertainment and recreation 4 8 Other service activities 3 7 Activities of households as employers; undifferentiated goods and 24 16 services producing activities of households for own use 32 39 Activities of extraterritorial organizations and bodies TOTAL 198 315 2 4 452 576 22001199sshohwoswas faairflayirsliygnsifiigcannifticreadnutcrtieodnuinctnioenw ienmnpelowyeer mregpilsotryaetironrecgoimstpraarteiodnto 2018, a decline of 21% fcroomm5p7a6reind20to182.0T1h8e,ecaondoemciclinaectiovifty2in1%thefrdoomme5st7ic6oirnho2u0s1e8ho. ld activities accounts for the largest decline compared to the previous year. The economic activity in the domestic or household activities accounts for the largest decline compared to the previous year. 12

ANNUAL REPORT 2018 & 2019 Benefits BENEFITS Benefits Benefits by Branch for 2019 Benefits by Branch for 2019 3% 3% 15% 15% 82% 82% ShorSthToerrmt TermLong TLeornmg TermEmploymEmenptloInyjumryent Injury BBrraanncchh 20192019 2018 2018 SShhoorrttTTeermrm $ $2,8232,,688223,6$82 2$,689,320,6889,308 ELELomomnnpgpglolToTyeyemrmmrementnItnIjnujruyry $ 1$$4,59115624,,,545972152062,,54$$7220 13$$,4164401,,70320,41536440,,702053 $ The purpose of the Social Security Fund is to pay benefits. We see a steady increase in benefit costs as the pbTplelahannenemfpimtuasa.rtupturoerssee.s.TohfTethhpeelapSnloamcniaamtul arSeteuacrseumraitosyremFuponereodppilseetoboepcpleoambyeebceeolnimgeibefiltese.flioWgribaelewsiefdoeerraaraswntegideaedarynrdainnhcgirgeehaeasrneldeivnheilbgsehonefer fliet vceolsstsofas the benefits. Short Term Benefits 2019 2018 2017 2016 2015 Short Term Benefits 1,191,7026019 1,289,5722018 1,189,622 20171,142,260 2018643,509 2015 Maternity Allowance SMicakntersns iBteynAelfliot wance ,3919,,189216,706 9661,9,12189,572 966,911,189,622 943,8911,142,268028,482 843,509 MSiacktenrensitsyBGernaenftit 232,,319590,826 244,709066,911 223,389966,911 236,000 943,891180,350 828,482 TMOaTAteLrnity Grant TOTAL 2,823,263822,150 2,501,182344,700 2,379,922223,3829,322,151 236,010,8052,341 180,350 2,823,682 2,501,183 2,379,922 2,322,151 131,852,341

SHORT TERM BENEFITS As the National Insurance Board matures and the insured population begin to understand their rights and privelidges we are experiencing an steady increase in the short term benefit branch. Between 2015 and 2019, this branch was increased by 52%. The chart below shows the increase in number of pensions over a five year span. As at 2019, retirement pension accounts for 75% of the total pensions, followed by survivors, which accounts for 14%. We are also beginning to see a gradual decline in the amount of non-contributory old age pension over the years. Overall, between 2015 and 2019 pensioners have increased by 28% 14

ANNUAL REPORT 2018 & 2019 Number of Pensioners Over 5 year Period Number of Pensioners Over 5 year Period 1854 1733 1625 1528 1854 1733 1625 1528 1449 1449 2019 2018 2017 2016 2015 2019 2018 2017 2016 2015 12,000,000 Pension Type 1102,,000000,,000000 Pension Type 180,,000000,,000000 US DUolSlaDrsoll$ars $ 68,,000000,,000000 46,,000000,,000000 2019 2018 2017 2016 2015 24,,000000,,000000 2,000,00-0 11,623091,9048 10,021051,8345 8,726061,1789 8,025011,4619 7,325071,1529 Retirement Pension - 111,3,69349,,200428 110,2,04195,,331495 81,706862,168291 89,04531,7,40129 79,31517,5,15259 SRuertvirievmoresnPtePnesniosnion 19,30964,5,24002 18,25439,1,37189 18,01802,6,67201 79843,678012 794101,951585 ISnuvravliivdoitrys Pension 7810,260770 76893,863831 71490,29218 OInlvdaAlidgietyNPoennCsioonntributory 7906,059460 687593,31178 Old Age Non Contributory 710,207 769,833 719,228 706,096 679,318 15

Compliance COMPLIANCE Zones Geographical Area Active Employers Total Employers Compliance Rate (Made atleast 1 (Expecting to pay) 80% Z1 Beaches to Leeward payment in 797 78% Gate year) 636 353 67% Z2 The Bight to Beaches 70% 274 946 76% roundabout 510 637 380 64% Z3 Blue Hills – West 355 86% Z4 Downtown, PLS 287 147 Z5 Five Cays, South 58 69% 94 91% Dock, Chalk Sound 50 13 93% 86 76% Z6 North Caicos 9 529 Z7 East of Beaches 78 3,820 492 rounabout to 2,913 Leeward Z8 Middle Caicos Z9 South Caicos Z10 Grand Turk Grand Total The National Insurance Board has an overall contribution compliance rate of 76%. The ThtearNgaetitownaalsInascuhraienvceedBofoarrdthheasfisacnaol vyeeraalrl. cCoonmtribpulitaionncecoemffpoliratsncceornattienuoef 7a6s%th. eTBheoatarrdg’estuwltaims aactehieved forotbhejefcisticvael yiseator. cCoolmlepcltiaanlcl emeofnfoiretss coownetinduteoatshethFeuBnoda.rd’s ultimate objective is to collect all monies owed to the Fund. ThTishyiseayretahretchoemcpolimanpcleiasntcraetesgtryawteagsyrewvaieswreedv,ieanwdeedf,foarntsdweeffroermtsawdeerteo mseaedketotoinscreeeaksetothinecurteilaizsaetion of thethUenpuatiildizNaatitoionnaolfInthseuraUnncpeaCiderNtifaictaiotensa.lTIhnissutoraonl aclelowCsetrhtieficBaotaersd.tTo hsiisgntioficoal natllyloawcscetlheeratBeothaerdprtoocess of scoigllneicfticinagnotluytsatacncdeilnegractoenttrhibeuptirooncseswsheonf ccoomllepcatriendg toouthtsetapnrodcinesguctioonnttrhibrouutgiohnt sthewchoeunrtsc.ompared to the procesution throught the courts. 16

ANNUAL REPORT 2018 & 2019 Investment I N V E S T M E N TInvestment This is the report of the National Insurance Board’s investment performance, operations and initiatives for the Ttwhois-yiseathr epereripoodret onfdtinhge MNatricohna3l1I,n2s0u1ra9n.ce Board’s investment performance, operations and initiatives for the two-year period ending March 31, 2019. The National Insurance Fund (NIF) earned a time-weighted return of 12.37% in fiscal year 2018 and 1.69% in fTishceaNl yaetiaorna2l0I1n9s,urwainthcethFeuenndd(iNngIF)faeirarvnaeludeaotifminev-ewsetimghetnetds raettu$r3n0o7f m12il.l3io7n%. Tinhefisrceaml ayerkaarb2le01r8etaunrnds1i.n69fi%scianl 2fis0c1a8l wyearer p2r0im19a,riwlyitthhethreseunltdoinf gstrfoanirgveacluoenoomf incvgersotwmthe,nhtseaaltth$y3c0o7rpmoirllaioten.eaTrhneinrgesmaanrdkaimblperorevtinugrncsoinnsufismcearl 2co0n1f8idweenrceepinrimthaerilUySth,earnedsualtmoof dsterroantge eeccoonnoommiicc grerocwovthe,rhyeinalthye cEourproozroanteeesaurpnpinogrsteadnbdyimapnroavcicnogmcmonosduamtiveer coenftirdael nbcaenkinpthoelicUy.ST, haendmaajmoroitdyeoraf tethecyoenaormwicasrechoaverarycteinriztheed Ebuyrolozwonveoslautpilpityoratenddbsytraongacrceotumrnmsoidnartivsek caessnetrtasl, hboawnkevpeorlivcoyl.aTtilhitey rmetaujronreitdy ionfththeefinyaelaqr uwaartsercohnarcaocntecerirznesdobvyerloawtravdoelawtilaitrybaentwdesetnrotnhge UreStuarnds Cinhirnisak. aGsosoedtsa, chtoivweemvearnvaogleamtilietyntreatnudrnaedtaicntitchael foinvaelrqwueaigrthetrtonecqounitcieesrnasllowveerdathtreadFeuwndartobeotuwtpeernfothrme UitsSbaenndcChmhianrak. bGyo2o.d51a%cti.ve management and a tactical overweight to equities allowed the Fund to outperform its benchmark by 2.51%. Most of the gains of 2018 were erased due to increased volatility in the markets, which reflected a deterioration Minogslot boaf lthseengtaiminesnotfa2n0d1e8cwoenroemeicramseodmdeunetutmo inrecsreualtisnegdinvoslhaatirliptydienctlhineems ainrktheetsm, wahrkicehtsr,epflaerctticeudlardlyeitnerthioerathtiiordn iqnugalrotebralosfethnetimfiennatnacniadl yeecaorn.oTmhiocumgohmpeonrttfuomlioregsrouwltitnhgwinashnaortpadsecrolinbeustinasthtehemaprkioertsfi,npaanrcticaul lyaerlayr,inththeeFtuhnird wquaasrtuepr ovf ethre3%finbayncmiaidl -yyeeaarr..TThhoeugvohlaptoilrittyfoilniothgero3wrdthquwaarstenr oetraasserdobaullsotfathsethgeaipnrsioorfftinhaenyceialr yaenadr,rethgeisFteurned awadseculpinoevoefr o3v%erb8y%m.idT-hyeeafirn.aTlhqeuvaortleartilsitaywinmthaerk3ertd sqeunatritmerenetraimsepdroavlleoaf nthdeagraeinbsouonfdthien ypeearfroarmndanrecgeiswtehriecdh alldoewcelidnethoef Fouvnedr 8to%e. nTdhethfeinyael aqruwaritherasapwosmitivaerkbeut tsmenotdimeestnrteimtuprnroovfe1a.6n9d%a. rTehbeouFnudndinupnedreforprmerafonrcmeewdhtihche malloodweel dpothrtefoFliuon(ditstopreimndarthyebeyenachr mwaithrk)abpyos2i.t6iv7e%buwtitmh othdespterrefoturrmnaonfc1e.6o9f %th.eTahleteFrnuantdiveunindveerpstemrfeonrmt seldeethve mdeotdraecltipnogrttfhoeliom(oitst pfrroimmapryerbfoernmchamncaer.k) by 2.67% with the performance of the alternative investment sleeve detracting the most from performance. Performance relative to the Policy Index is detailed below: Performance relative to the Policy Index is detailed below: MULTI-YEAR RETURNS (YEAR ENDING MARCH 2018 & MARCH 2019) MULTI-YEAR RETURNS (YEAR ENDING MARCH 2018 & MARCH 2019) 2019 Index 2018 2019 20R1e9tIunrdnex Asset Category Index Name 2018 Index F2u01n8d F2u01n9d 20R1e8tIunrdnex Return Asset Category RFeutnudrn RFeutunrdn Index Name 4.36% TOTAL FUND 1R2e.t3u7r%n R1e.6t9u%rn POLICY INDEX R9e.8t6u%rn TUOST&AILntF’lUENqDuity 120.3475% 10.7669% PEqOuLitIyCBYeInNcDhEmXark 79.86% 41.3060% UFiSxe&d IInntc’loEmqeuity 100.2.485%% 0.6736% BEqaurcitlayyBCenacphitmalaArkggregate 70.2846% 10.8001% CFioxnevdeIrnticbolemse 0.5283% 0.1663% BMaLrcAlallyCConavpeitratlibAleggregate 0.6224% 0.4814% CHoendgveertFibulnedss 00..3573%% 00..0126%% HMFLRAIllFCOoFn:vCeortnibslervative 0.2624% 0.3447% PHreivdagtee FEuqnuditsy 00..4347%% 00..0127%% HFRI FOF: Conservative 0.24% 0.37% Absolute Return Strategies 0.25% 1.64% CProivmamteoEdqitiueisty 0.2464% -00..1172%% DAbBsIQoluOteptRimeutumrnYSietrldategies 0.6225% 1.n6/4a% Caosmhmodities 0.2056% -00..0172%% 9D0B-IDQaOy Tpt-iBmilul m Yield 0.602% 0.n1/1a% Cash 0.05% 0.07% 90-Day T-Bill 0.02% 0.11% The actuarial targeted rate of return was 5% for the period under review. The NIF far surpassed this target in fTishceaal 2ct0u1a8r,iailt tbaurgt ewtaesd urantaebolef rtoetsuurnrpwaass i5t %in foisrctahle2p0e1r9io. dThuendNeIrFraelvsioewb.eTnhchemNaIFrksfairtsseulrfpaagsasiendstthains atabrsgoelut tien rfiestcuarnl 2o0f18U,Sit CbuPtIwinafslautinoanbplelutso s3u%rp. aInssfist cinalfis2c0a1l82,0t1h9e. NThIFe bNeIFatatlhsios bbeenncchhmmaarrkks bityse6lf9a7gabianssitsapnoainbtsoalunted ruentduernrpoefrfoUrSmeCdPbI yin3fl2a1tiobnaspislupso3in%ts. inInfifsiscacal 2l 021091.8, the NIF beat this benchmark by 697 basis points and underperformed by 321 basis points in fiscal 2019. The period under review demonstrates the wide swings in performance over the short-term. While volatile Ttimheespmeraioydcaunll dfoerrtarecvticeawl sdteramteognystdreacteissiotnhse, wthiedeNIsBwrinegmsainspceormfomrmitatendcetooitvsesr ttrhaetegshicoartl-lotecramti.onWfhroilme vaolloantigle- teimrmespmearsypceacltlivfoer. tAacstitchael smtraartkeegtys dneacviisgioantes,ptehreioNdIsBorfemvoalaintislitcyo,mthmeitNteIdB troeimtsasintrsatdeigsiccipallilnoecdatbioynefrmomploayilnognga- tmeormdepraetreslpyeacgtigvere.sAssivethienvmeastrmkeetnstnsatrvaigteagtey fpoecruiosdinsgoofnvololantgil-itye,rmthegrNowIBthreomf caainpsitadl,ismciapilninteadinibnyg eamdpivloeyrsinifgiead mpoordtfeorliaotealnydaaggdriesscsipivlieneindvaepsptmroeancthstoramteagiyntfaoicnuinsgintgheonstlroantegg-tiecramssgerot waltlhocoafticoanp.ital, maintaining a diversified portfolio and a disciplined approach to maintaining the strategic asset allocation. 17 P a g e 19 | 231 P a g e 19 | 231

The NIB maintains a diverse portfolio of assets consists of equities, fixed income, alternative investments and cash. The Board approves the asset allocation framework designed to obtain the highest expected return on investments with an acceptable level of risk. During the period under review, the Board of Directors considered Tanhde NapIBprmovaeindtaainnseawdsivterarsteegpicoratfsoslieot oafllaoscsaetitosncoanftseirsttsheofienqveusittiemse,nfitxecodninsucoltamnet,raelvteisrneadtitvheeiirnvceasptimtael nmtsaarknedt caassshu.mTphtieonBsoaanrdd athpepr8othveAscttuhaeriaasl sReetvaiellwocoaftitohne fsraysmteemwowrkasdecosingdnuecdtetod.oTbhtaeinchtahnegheisghineslotnegx-pteercmteadsrseetut rcnlaosns irnisvkesatnmdernetswwaridtheaxnpaeccctaetpiotanbsleanledveclhoafnrgiseks. Dinurtihneg sthyestpeemri’osdliuanbdilietirersevwieawrra, tnhteedBoaacrdhaonf gDeireincttohres cinovnessidtmereendt astnradteagpyp.roved a new strategic asset allocation after the investment consultant revised their capital market aBAasritssfsarfksoassurteuaedmdcngtphdyoot,.nidrotheitnahewsleanuareapndwndiatesstlxhytpprseaoeist8sce,tithgtaiitoAitcwinocaatniusnssasrderaiisetankatldeiRlelrocrmechaviaansietnesiwogednetostsshftaatoihnwt ettathehskeqeyeruseiastteiydwemsvsetaerawnemntaand’ssgofceilxnioaeoenbdfaditlruiihntticeeectoserrmimdsw.kelaTi-qrrrheuereawiddnucaitthcreydeadndnpeagraeoencdpsdhseianarantlitnlegoedsenrngtoihan-ftatetivthtrheetmehiaenaisnvsNsevseIeseBtsttmctccmleoalaenussnstldsst. Binacsreeadsoentoth2e5a%naflryosmis,1i5t %wa. sThdeteCromminmeoddtihtiaetsthaesrseetwcelaressnowansearremteormveldiqufriodmitytnheesdtsraatengdicthaaltlotchaetiNonIBacsotuhled arefftourdn teosdtimialautepsitwseproesnitoiotncoinmrmiskeinesruarsastetws ittoh ttahkeeriasdkvsaonftathgeeaosfstehtecrliassks-r.eward properties of the asset class. iATnhscerseuBacoshea,rtdtho’es2np5eo%wlicfsyrtortamarteg1ge5itcs%an.soTswheetcaoClmloopcmraimstieoosnd:istiaews equities and fixed income reduced and alternative investments asset class was removed from the strategic allocation as the returxn esAtimreadtuecstiwonerien nGolot bcoaml Emqeunitsieusratote4w4i%th (tchoemripsrkisseodf othfeUaSsseeqtucitliaesssa. t 22% and international equities at ThexBoaF2rd2ix’%sed)poInliccoymtaergaentds Cnoownvceormtibplerisseast:26% (comprised of fixed income at 18% and convertibles at 8%). x AnreindcurcetaiosneiinnGAllotebranlaEtiqveuitIinevsetsotm44e%nts(ctom25p%rise(cdoomfpUriSseedqoufitiheesdagte2f2u%ndasnadt i1n5te%rnaantidonparilveaqteuietiqeusitayt a2t21%0)%). x AFinxeindcIrnecaosme einaCnadsCho&nvMeortnibelyesMaatrk2e6t%In(sctorummperinstesdtoof5f%ixe. d income at 18% and convertibles at 8%). ThexactuAanl ainllcorceaatsioeninasAaltteyrneaatri-veenIdnvfoersbtmotehnptsetroio2d5s%we(creomasprfioslelodwosf: hedge funds at 15% and private equity x Aatn12i00n%1cr8)e.Aasseseint CAallsohca&tiMononey Market Instruments t2o051%9 .Asset Allocation The actual allocation as at year-end for both periods were as follows: Actual Asset Mix FHHCu1eePPEEon0ddrrqqn%diiP33ggvvvuus%%reeeaaiii,vrtttttyyaeei2,,bt3el0H%eEs1eAqd8ugc9ieAtt2%yuFs0aus1CCnle8aadAtsssAshhAsS,,Ael77lcSto%%tuBEMcao1aTl6niAtx%AdisCossLo,nemLt MOm2CCC%6iiioCxattoo%diisAeemmihtssiTemm,,sI22Ooo%%ddN Coems,m2o%d2it0iP1r9ivaAtesAsectt2CuA0a1asllh9ol, c8AA%aSAsticsSoteuEnatTl AMAssLeiLxt MOiCx ATION ActualCommodiEtqi uityH,e6d%g1e1%Funds Asset MixCommodities 2% es, 2H%edge Cash FunPdsrEi,vq1Pau1rt6eii%tv%yaE,tq6eu%ity Cash, 8% Equities, 7% Fund7s,% Co n ve rti CHonevdegretibles 47% 10% Bonds, bl es, 7% CFounnvdesr7,t%i1b1le% Equi ties, 16% s, 8% B1o9n%dBs,ondsEq4u7it%iesE, q4u7i%ties 55% Bonds Convertible EquCitioens ve rti 20% 20% 53b%l es, 7% Equi ties, s, 8% Bonds, 55% 19% The charts above show the asset allocation of the Fund in the respective years and highlights the change from one year to the next. During the period under review, the Fund continued to invest excess contribution income into the Fund by reallocating cash into other parts of the portfolio through periodic rebalancing exercises. TSheevecrhaal rrtesbaablaonvecinsghoewxethrceisaesssetot aolklopclaatcioendoufrtihneg Fthuendyeinatrh. eTrheesppeocrttfivoelioyetoaorsk aandmhoirgehldigehfetsnsthiveechstaanngceefraonmd oronteatyeedaorutot othf erisnkeaxst.sDeutsrisnpgetchieficpaellryiobdyutrnimdemr irnegvieeqwu,itthyepoFsuintidoncsonatnindureedaltloocinavtiensgtienxtocefisxsedcoinnctroibmuetiosnecinucriotimese. iTnhtois trheeduFcuendd tbhye roevaellrowceaitginhgt ecqausihtieinstopoostihtieorn pnaeratsreorftotheitspsotrrtafoteliogicthtraoruggeht opfe4ri4o%dic. Trehbeaplarnivcainteg eeqxueirtcyisaensd. Sheedvgeeraflurnedbaslaenecviensgweexreercailsseosptoopouklaptleadceovdeurrtinhge ptheerioydeathr.roTuhgeh pthoertfaodlidoittionokofafimveonreewdemfeannsaivgeersst.ance and hTrmrToeehhatsdiaeispngtoeNterandeIiBfsdnuoiubnuioscldteueocrsdmofdlermtaiihsesnmcevknieipaetostlsreivnwsdereeeertwtftrosloeeestctiahgphtileheevstecopsiefrtpoiurqcoafdauptteelihlutyngieelatibcsotmyeabpdatsjorenisosmcaevittgmtieivoeareinnmltslhogneecoeenafpqatttieurahoerinentiryodiFtdnposuotuonhistsrdrsidtto.aieousiWrnntgrtashahobtiatelaiehlngicetdyirhcearioetedtufavadretrlnihgltositeeohctnwaeFoteuoiefnrnfxeg4dfpi4vivena%eoctnoltna.deetfdTiialxwehriemeemdotsuvpainrertnnoicrvasoatmghmateeeanerndsepsa.qepegurrceioioutvyidrtiid,taiineewnsadea. TrehlieabNleIBsoisucrcoemomf iattsesdetotothpeayprpurdoemnitsmedanbaegnemfitsentot athned pseuosptaleinoafbtihlitey Touf rtkhseaFnudnCd aaincodsaIismlasntdosm. anage it in a 18 responsible manner reflective of the objectives of the Fund. While returns were volatile over the period, we maintain our discipline to the strategic asset allocation in order to achieve the expected rPetaurgnsean2d0 p|ro2v3id1e a reliable source of asset to pay promised benefits to the people of the Turks and Caicos Islands.

ANNUAL REPORT 2018 & 2019 HUMAN RESOURCES Annual Report The National Insurance Board Human Resource & Administration Department is keen on proactively providing strategic support and guidance to the employees, organization and community that we serve. Welcome… to a snapshot of the HRA Department activities for the fiscal years 2017-2018 and 2018-2019. This report is divided into three sections. 1. Workforce 2. Training and Development / Staff Accomplishments 3. Human Resource Programs Workforce The National Insurance has maintained a staff count of 48-51 for the last few years with the majority of staff serving more than fifteen years. The workforce includes both full-time and part-time staff who fill administration, compliance, data entry, benefits, technical and managerial roles. 19

April 2017-2018 Staff Count STAFF COUNT FOR PERIOD APRIL 2017 T0 MARCH 2018 50 50 50 50 50 50 50 50 50 48 48 48 Month April 2018-2019 Staff Count STAFF COUNT FOR PERIOD APRIL 2018 TO MARCH 2019 Staī Count 51 51 51 48 48 48 48 48 48 48 48 48 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Month 20

ANNUAL REPORT 2018 & 2019 YEARS OF SERVICE 11% 51% More than 15 years 18% More than 10 years More than 5 years 20% Less than 5 years New Entries and Departures STAFF NAME POSTION DEPARTMENT ENTRY DEPARTURE Cherline Dabel Accounting Clerk Accounts & 20-Dec-2017 15-Mar-2019 Doric Quant Transaction Clerk Finance Rowena Nelson Operations, Provo 14-Mar-2018 2-Jan-2018 Roschad Bethel Accountant Accounts & Cheryl Hamilton- Transaction Clerk Finance 29-Mar-2018 Duncan Operations, Provo 12-Dec-2017 Walter Gardiner Sean Pratt Compliance Officer Operations, Provo Tushae Wilson Katrina King Smith Director/CEO Office of Director 30-Nov-2017 Operations Registration Clerk 3-Apr-2018 9-Apr-2018 Operations Transaction Clerk 2-Jan-2019 Accounts & Assistant Finance Accountant Training and Development/ Staff Accomplishments (April 2017 to March 2019) The National Insurance Board views training as an investment in the human resource of the 21 organization to meet business environmental changes and improve employee’s performance. The HR Department provides a variety of training and development opportunities aimed at building staff capabilities.

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AMAKMAAAMAAMlcelclalcaaallllcicncnnnStSSSoohoaaaattttuuuaggaagagJnnfffeneefeeffffttmmmtmnsssneeeeSSSinnnnnttttttaatagAfAfAfAsfffnnnnIIIINNNNdddd HHHHOOOOUUUUNISISNINNSInnnnSSSSMeeIIIeIvvvvBBBBEEEmEmemeeIeSsssLLLsiLiTTTiTnntntteteeeMmmmRRRmRaaaggggrrAAAaerAeeieiiissssnnnnIIInIlllNNNlNaaatttat tttIIIgtIiiiNNNiNoooeoGGGnnnGrn ULFFFLULFULeeeAAAeABBBggggCCCSSCSaaaaIIIIlllFlLLLFLFMCCCCiIIIiIinnAAAnAioooocaaaTTTuuuTurnnnonOOOnnOncccssssRRRiiRioaaeeeaefllllllltMMMWaaainnnnaadaggogeewemmms eee1nnn0ttt Atlanta Aug-18 UBS Financial Management Aug-18 Providenciales Aug-18 Providenciales Providenciales Aug-18 Providenciales TAAhelclcSLoetuagnfaftlsCSotuanffsel wasNSaeIBwmaLinredagerisdlatthioentitle “CLheagratleCreodunDsierel ctor” from the Caribbean Governance Training ITIITTITTnnnnMArhhrhssssaaeecetttatiiiiiinctnttntuuuLLuiLoinanttteeteeeugeggggg...n.eaaCaCtmlllsllaaCCeCsSsnoosostteuuauesnnfAnsfsssnbbeeeydylll AwwwtaataesssnSIndaaeavawwmwenaasaicntrrrmeddad:eereedddntttthhheee title 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Classes by Total PPaarrt6tiicciippaannttss 22Training Classes by AttendCSTSTCCSTTCPPPCSTCParrrreeerrrorooerllonaaaaoooaaaommmnmnnnciiiiifffssfnnnnfnffeeeefieiissieeeennniiiin:isssseennnnrnrrraaaassssseseeegggggrrrriiininnnooooccccnnnneeeeaaaallll Development Total PPaarr515151515tt222666264444444ii44cciippaannttss Development Total Development Total Development Seminar 14 P a g e 25 | 232 P a g e 25 | 232 P a g e 25 | 232 2 P a g e 25 | 232 Conference

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ANNUAL REPORT 2018 & 2019 Former Chair of the Board of Director Mr. Eustace Brooks Mr. Stanley Been Mr. Leon Wilson YEARS OF SERVICE YEARS OF SERVICE YEARS OF SERVICE 1992-1997 1997-2001 2001-2003 Mr. Gordon Burton Mr. Ervin Quelch Ms. Lillian Missick YEARS OF SERVICE YEARS OF SERVICE YEARS OF SERVICE 2003-2007 2007-2012 2012-2017 25

Former Director / CEOs Mr. Trevor Cooke Mr. Benson Harvey YEARS OF SERVICE YEARS OF SERVICE 1992-1997 & 2004-2011 1996-2004 Mr. Colin Heartwell Mr. Walter F. L. Gardiner YEARS OF SERVICE YEARS OF SERVICE 2011-2015 2015-2017 26

ANNUAL REPORT 2018 & 2019 STATEMENT ON INTERNAL CONTROL Scope of Responsibility As Accounting Officer, I have responsibility for maintaining a sound system of internal control that supports the achievement of the National Insurance Board policies, aims and objectives, whilst safeguarding the public funds and departmental assets for which I am personally responsible, in accordance with the responsibilities assigned to me in the Public Finance Management Ordinance. The Internal Controls of the National Insurance Board (NIB) are all the Policies and Procedures that the NIB have designed to give reasonable assurance regarding the achievement of organizational objectives in the following areas: • Reliability of Financial Reporting • Operational effectiveness and efficiency • Compliance with applicable laws and regulation The purpose of the system of internal control The system of internal control is designed to manage risk to a reasonable level rather than to eliminate all risk of failure to achieve policies, aims and objectives; it can therefore only provide reasonable and not absolute assurance of effectiveness. The system of internal control is based on an ongoing process designed to identify and prioritize the risks to the achievement of NIB policies, aims and objectives, to evaluate the likelihood of those risks being realized and the impact should they be realized, and to manage them efficiently, effectively and economically. The system of internal control has been in place in the NIB for the year ended 31, March 2018 and up to the date of approval of the annual report and accounts. The NIB has developed a system of internal control that not only includes policies and procedures but also includes control activities which fall into two categories namely that of prevention and detection. These activities are applied throughout the organization at all levels to the various functions and processes and include the following: • Authorization • Documentation • Reconciliation • Security • Separation of duties 27

Capacity to Handle Risk and the Risk Control Framework The NIB has developed a risk profile and risk management policy approved by the Board Directors which identifies, prioritize and evaluate the key 15 risks in the organization and the likelihood and impact should these risks be realized. In order further strengthen the risk control framework and to ensure that this is embedded at all levels within the organization the NIB has also embarked on a risk based analysis of its current Strategic Plan. This document will be presented to the Board of directors for approval at their meeting in February 2019. Review of Effectiveness As Accounting Officer, I have responsibility for reviewing the effectiveness of the system of internal control. My review is informed by the work of the internal auditor and the executive managers within the National Insurance Board, who have responsibility for the development and maintenance of the internal control framework, and comments made by the external auditors in their management letter and other reports. The effectiveness of the internal control system has been reviewed via our current governance processes and these include: • Monthly management reports to the Board of Directors • Monthly Internal Auditors reports to the Board of Directors • Audit Committee Reports to the Board • Agreed upon Procedures review by the National Audit Office • Annual External Audit and Management Letter I am therefore satisfied based upon the reviews conducted that the control environment of the NIB has been effective for the financial year ended March 2018. Where areas of weaknesses have been identified management has made the necessary adjustments and changes to strengthen the internal controls thus improving overall effectiveness of the system of controls. 28

ANNUAL REPORT 2018 & 2019 FINANCIAL STATEMENTS OF FINANCIAL STATEMENTS TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD YEAR ENDED MARCH 31, 2018 2018 29

FINANCIAL CONTENTS STATEMENTS TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD Financial Statements | Year Ended - March 31, 2018 Independent Auditors' Report 31-34 Statement of Financial Position 35 Statement of Income, Expenses and Reserves 36 Long-Term Benefit Branch 37 Short-Term Benefit Branch 38 Employment Injury Benefit / Disablement and Death Benefit 39 2018 Statement of Changes in Reserves 40 Statement of Cash Flows 41 Notes to Financial Statements 42-90 30

KPMG Ltd. KPMG Building 18 The Village at Grace Bay PO Box 357 Providenciales Turks and Caicos Islands, BWI Telephone: 649 946 4613, Fax: 649 946 4619 INDEPENDENT AUDITORS’ REPORT FINANCIAL STATEMENTS To the Directors of the Turks and Caicos Islands National Insurance Board: 2018 Report on the Audit of the Financial Statements Qualified Opinion We have audited the financial statements of the Turks and Caicos Islands National Insurance Board (NIB), which comprise the statement of financial position as at March 31, 2018, the statements of income, expenses and reserves, changes in reserves and cash flows for the year then ended, and notes, comprising significant accounting policies and other explanatory information. In our opinion, except for the effects of the matter described in the Basis for Qualified Opinion section of our report, the accompanying financial statements give a true and fair view of the financial position of NIB as at March 31, 2018, and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRS). Basis for Qualified Opinion As disclosed at notes 10 and 12 to these financial statements on April 9, 2010, TCI Bank Limited (TCI Bank) was placed into provisional liquidation and on October 29, 2010, TCI Bank was placed into liquidation. At March 31, 2018 and 2017, NIB held substantial long- term deposits with TCI Bank, a current account with TCI Bank and an investment in TCI Bank. NIB’s management have made certain fair value adjustments in relation to NIB’s various asset holdings with TCI Bank. Such fair value adjustments are disclosed more fully in the aforementioned notes to these financial statements and they include, but are not restricted to, a 56% fair value adjustment against the carrying value of NIB’s long- term deposits and current account with TCI Bank. As at the date of this report NIB had received interim distributions of 40 cents in the dollar from the liquidator in respect of its long term deposits and current account. KPMG Ltd., a Turks and Caicos Islands limited liability company incorporated 31 under the Turks and Caicos Islands’ Companies Ordinance, is the Turks and Caicos Islands member firm of KPMG International, a Swiss cooperative.

FINANCIAL Turks and Caicos Islands National Insurance Board STATEMENTS Independent Auditors’ Report March 31, 2018 Basis for Qualified Opinion, continued The ultimate outcome of this matter cannot presently be determined with certainty and the actual fair value adjustment that will ultimately be needed against the carrying value of NIB’s various asset holdings with TCI Bank under International Accounting Standard (IAS) 39, ‘Financial Instruments: Recognition and Measurement’, can only be estimated using information available as at the date of this report and could vary significantly from the estimate provided because of the considerable inherent uncertainty involved. Consequently, the impact on the statement of financial position of the carrying value of these asset holdings with TCI Bank and the impact of the changes in fair value reported in the statements of income, expenses and reserves, as a consequence of TCI Bank being placed into provisional liquidation and subsequently into liquidation, cannot currently be estimated with any reasonable certainty and may be material. We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of NIB in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code) and we have fulfilled our other ethical responsibilities in accordance with the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion. Emphasis of Matter Without further qualifying our opinion, we draw attention to note 23 to these financial 2018 statements. As disclosed at note 23 to these financial statements, NIB has elected to apply IAS 26, ‘Accounting and Reporting by Retirement Benefit Plans’, which requires the actuarial present value of promised retirement benefits to be recognised on the statement of financial position, in the notes to the financial statements or in an accompanying actuarial report. NIB has chosen to disclose the actuarial present value of promised retirement benefits of US$459 million at March 31, 2016 (2013: US$388 million), the date of NIB’s latest actuarial review, using a current salary approach, in the notes to these financial statements. NIB had total reserves of US$191 million at March 31, 2016 (2013: US$153 million) and there was therefore a shortfall of US$268 million (2013: US$235 million) between the total reserves and the actuarial present value of promised retirement benefits. 32 KPMG Ltd., a Turks and Caicos Islands limited liability company incorporated under the Turks and Caicos Islands’ Companies Ordinance, is the Turks and Caicos Islands member firm of KPMG International, a Swiss cooperative. 2

Turks and Caicos Islands National Insurance Board Independent Auditors’ Report March 31, 2018 Responsibilities of Management and Those Charged with Governance for the Financial FINANCIAL Statements STATEMENTS Management is responsible for the preparation of financial statements that give a true 2018 and fair view in accordance with IFRS, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing NIB’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate NIB or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing NIB’s financial reporting process. Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:  Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.  Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of NIB’s internal control. KPMG Ltd., a Turks and Caicos Islands limited liability company incorporated 33 under the Turks and Caicos Islands’ Companies Ordinance, is the Turks and Caicos Islands member firm of KPMG International, a Swiss cooperative. 3

FINANCIAL Turks and Caicos Islands National Insurance Board STATEMENTS Independent Auditors’ Report March 31, 2018 2018 Auditors’ Responsibilities for the Audit of the Financial Statements, continued 34  Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.  Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on NIB’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause NIB to cease to continue as a going concern.  Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Report on Other Legal and Regulatory Requirements In accordance with the requirements of the Turks and Caicos Islands’ National Insurance Ordinance 1991 and National Insurance (Financial and Accounting) Regulations (hereafter referred to collectively as ‘the Ordinance’), we also confirm that the presentation, structure and content of the financial statements of NIB at March 31, 2018 and for the year then ended is consistent with the requirements of the Ordinance. Intended Use of Report This report is intended solely for the information and use of the Minister of Finance of TCI and the Directors of NIB and should not be relied on by anyone other than these specified parties. Chartered Accountants Providenciales, Turks and Caicos Islands April 30, 2019 KPMG Ltd., a Turks and Caicos Islands limited liability company incorporated under the Turks and Caicos Islands’ Companies Ordinance, is the Turks and Caicos Islands member firm of KPMG International, a Swiss cooperative. 4

TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD Statement of Financial Position At March 31, 2018 with comparative figures at March 31, 2017 2018 2017 Assets US$ 24,751,772 20,639,287 3,479,874 3,679,532 Current assets: 4,322,933 4,200,000 Cash and cash equivalents (note 5) 150,000 150,000 Contributions and other receivables (note 6) 54,281 35,216 Short-term investment (note 7) Current portion of long-term receivables (note 9) 32,758,860 28,704,035 Other assets 254,874,198 215,109,460 Non-current assets: 5,376,750 5,547,584 Available-for-sale financial assets (note 8) 694,100 694,100 Long-term receivables (note 9) 3,195,852 3,441,894 Long-term deposits (note 10) – – Property and equipment (note 11) Investment in TCI Bank Limited (note 12) 264,140,900 224,793,038 US$ 296,899,760 253,497,073 Liabilities and Reserves US$ 1,584,354 2,413,153 FINANCIAL STATEMENTS Liabilities: 36,120,000 32,280,000 Accounts payable and 37,704,354 34,693,153 2018 accrued expenses (note 13) Provisions for long-term benefits, 183,858,986 157,131,023 other than retirement benefits (note 23) 31,750,352 26,166,302 963,377 1,072,256 Reserves: 42,622,691 34,434,339 Long-term benefit branch Short-term benefit branch 259,195,406 218,803,920 Employment injury benefit (note 22) Disablement and death benefit US$ 296,899,760 253,497,073 The accompanying notes are an integral part of these financial statements. These financial statements were approved on behalf of the Board of Directors on April 30, 2019 by the following: Samuel Swann Chairman Rhesa Cartwright Director 35 5

TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD Statement of Income, Expenses and Reserves Year ended March 31, 2018 with comparative figures for year ended March 31, 2017 2018 2017 Income: US$ 32,384,607 29,265,197 Contributions: 1,867,288 1,697,166 Private sector 800,304 738,516 Civil servants 116 – Self employed Voluntary 35,052,315 31,700,879 Income from, and net realised gains on, 11,525,571 9,644,527 available-for-sale financial assets (note 14) 1,223,340 644,280 653,306 497,939 Surcharges Interest and other income (note 15) 48,454,532 42,487,625 Expenses: (16,294,036) (14,541,749) Benefits (note 16) (5,590,191) (4,776,481) General and administrative expenses (note 17) Change in provisions for long-term benefits, (3,840,000) (1,880,000) other than retirement benefits (note 23) (1,460,054) (1,235,244) Investment expenses (note 18) (27,184,281) (22,433,474) FINANCIAL Net income before other comprehensive income 21,270,251 20,054,151 STATEMENTS Other comprehensive income (note 19) 19,121,235 7,409,373 Net income for year US$ 40,391,486 27,463,524 Net income for year transferred to: Long-term benefit branch reserve US$ 26,727,963 17,292,844 2018 Short-term benefit branch reserve 5,584,050 3,759,874 Employment injury benefit reserve (108,879) (241,487) Disablement and death benefit reserve 8,188,352 6,652,293 US$ 40,391,486 27,463,524 The accompanying notes are an integral part of these financial statements. 36 6

TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD Long-Term Benefit Branch Statement of Income, Expenses and Reserve Year ended March 31, 2018 with comparative figures for year ended March 31, 2017 2018 2017 Income: US$ 22,264,417 20,119,822 Contributions: 1,499,282 1,362,688 Private sector 647,305 597,329 Civil servants 116 – Self employed Voluntary 24,411,120 22,079,839 Income from, and net realised gains on, 8,276,930 7,048,554 available-for-sale financial assets 841,046 453,270 469,163 363,911 Surcharges Interest and other income 33,998,259 29,945,574 Expenses: (13,140,003) (11,724,755) Benefits (note 16) (3,745,428) (3,200,242) General and administrative expenses Change in provisions for long-term benefits, (3,068,000) (2,240,000) other than retirement benefits (1,048,517) (902,759) Investment expenses (21,001,948) (18,067,756) Net income before other comprehensive income 12,996,311 11,877,818 FINANCIAL Other comprehensive income 13,731,652 5,415,026 STATEMENTS Net income for year US$ 26,727,963 17,292,844 The accompanying notes are an integral part of these financial statements. 2018 37 7

TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD Short-Term Benefit Branch Statement of Income, Expenses and Reserve Year ended March 31, 2018 with comparative figures for year ended March 31, 2017 2018 2017 Income: US$ 5,262,499 4,755,595 Contributions: 152,999 141,187 Private sector 40,890 37,164 Self employed Civil servants 5,456,388 4,933,946 Income from, and net realised gains on, 1,378,319 1,129,398 available-for-sale financial assets 198,793 107,136 78,127 58,310 Surcharges Interest and other income 7,111,627 6,228,790 Expenses: (2,689,308) (2,379,920) Benefits (note 16) (950,332) (812,002) General and administrative expenses (174,605) (144,650) Investment expenses (3,814,245) (3,336,572) Net income before other comprehensive income 3,297,382 2,892,218 Other comprehensive income 2,286,668 867,656 Net income for year US$ 5,584,050 3,759,874 FINANCIAL The accompanying notes are an integral part of these financial statements. STATEMENTS 2018 38 8

TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD Employment Injury Benefit / Disablement and Death Benefit Statement of Income, Expenses and Reserves Year ended March 31, 2018 with comparative figures for year ended March 31, 2017 2018 2017 Income: US$ 4,857,691 4,389,780 Contributions: 327,116 297,314 Private sector Civil servants 5,184,807 4,687,094 Income from, and net realised gains on, 1,870,322 1,466,575 available-for-sale financial assets 183,501 83,874 106,016 75,718 Surcharges Interest and other income 7,344,646 6,313,261 Expenses: (894,431) (764,237) General and administrative expenses Change in provisions for long-term benefits, (772,000) 360,000 other than retirement benefits (464,725) (437,074) Benefits (note 16) (236,932) (187,835) Investment expenses (2,368,088) (1,029,146) Net income before other comprehensive income 4,976,558 5,284,115 Other comprehensive income 3,102,915 1,126,691 Net income for year US$ 8,079,473 6,410,806 Net income for year transferred to: US$ (108,879) (241,487) FINANCIAL Employment injury benefit reserve 8,188,352 6,652,293 STATEMENTS Disablement and death benefit reserve 6,410,806 US$ 8,079,473 2018 The accompanying notes are an integral part of these financial statements. 39 9

2018 FINANCIAL STATEMENTS 40 TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD Statement of Changes in Reserves Year ended March 31, 2018 with comparative figures for year ended March 31, 2017 Long-term Short-term Employment Disablement and Total benefit branch benefit branch injury benefit death benefit US$ US$ US$ US$ US$ 191,340,396 Balance at April 1, 2016 139,838,179 22,406,428 1,313,743 27,782,046 27,463,524 Transfer from net income for year 17,292,844 3,759,874 (241,487) 6,652,293 Balance at March 31, 2017 157,131,023 26,166,302 1,072,256 34,434,339 218,803,920 Balance at April 1, 2017 157,131,023 26,166,302 1,072,256 34,434,339 218,803,920 Transfer from net income for year 26,727,963 5,584,050 (108,879) 8,188,352 40,391,486 Balance at March 31, 2018 183,858,986 31,750,352 963,377 42,622,691 259,195,406 The accompanying notes are an integral part of these financial statements. 10

TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD Statement of Cash Flows Year ended March 31, 2018 with comparative figures for year ended March 31, 2017 2018 2017 Cash flows from operating activities: US$ 21,270,251 20,054,151 Net income before other comprehensive income Adjustments for: 20,834 20,795 Change in fair value of TCI Government 278,497 268,763 (TCIG) bonds (note 15) (425,124) (352,912) Depreciation of property and equipment 1,341,974 1,112,890 Interest income (note 15) (11,525,571) (9,644,527) Investment expenses on available-for-sale 10,960,861 11,459,160 financial assets (note 18) Income from, and net realised gains on, 69,791 182,395 available-for-sale financial assets (19,065) (6,800) (828,799) Changes in operating assets: 3,840,000 238,396 Change in contributions and other receivables, 14,022,788 1,880,000 net of interest receivable 13,753,151 Change in other assets (40,718,259) 30,258,353 (83,885,455) Changes in operating liabilities: 62,756,024 Change in accounts payable and accrued expenses 554,991 Change in provisions for long-term benefits, 150,000 187,224 other than retirement benefits (122,933) 150,000 (32,455) (4,200,000) Net cash from operating activities (128,473) – (5,000,000) Cash flows used in investing activities: (9,910,303) (30,120,680) FINANCIAL Net additions to available-for-sale financial assets 4,112,485 (16,367,529) STATEMENTS Net proceeds from available-for-sale financial assets 20,639,287 37,006,816 Interest income received 24,751,772 20,639,287 2018 Proceeds from partial repayment of TCIG bonds Short-term investment Additions to property and equipment Investment in FortisTCI Limited bonds Net cash used in investing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year US$ Cash and cash equivalents at end of year The accompanying notes are an integral part of these financial statements. 41 11

FINANCIAL TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD STATEMENTS Notes to Financial Statements Year ended March 31, 2018 1. General information The Turks and Caicos Islands National Insurance Board (NIB) is a body corporate established in the Turks and Caicos Islands (TCI) on April 6, 1992 pursuant to section 27 of the National Insurance Ordinance 1991 (the Ordinance), as revised. NIB’s primary purpose is to control and manage the National Insurance Fund (“the Fund”) established under section 45 of the Ordinance so as to provide various benefits to persons insured under the Ordinance. NIB’s registered office address is at the Hon. L. Headley Durham building, Grand Turk, TCI. 2. Basis of preparation (a) Statement of accounting These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and with the requirements of the Ordinance. Details of NIB’s significant accounting policies are included at note 3. These financial statements have been prepared on a fair value basis for all assets held for investment purposes and under the historical cost convention for all other assets and liabilities. The methods used to measure fair values are discussed further at note 4. (b) Functional and presentation currency These financial statements are presented in United States (US) dollars, which is 2018 NIB’s functional currency. All financial information presented in US dollars has been rounded to the nearest dollar. (c) Use of estimates and judgements The preparation of these financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively. Information about significant areas of estimation, uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements is included in the following notes: 42 12

TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD FINANCIAL STATEMENTS Notes to Financial Statements, continued 2018 Year ended March 31, 2018 2. Basis of preparation, continued (c) Use of estimates and judgements, continued  Note 6 – Contributions and other receivables  Note 10 – Long-term deposits  Note 12 – Investment in TCI Bank Limited  Note 23 – Actuarial review These financial statements have been prepared on a going concern basis. No adjustments or reclassifications have been made that might be necessary if a basis of accounting other than a going concern basis were to be used. 3. Significant accounting policies The accounting policies set out below have been applied to all periods presented in these financial statements, and have been applied consistently by NIB. Certain comparative amounts have been reclassified to conform with the current year’s financial statement presentation. (a) Non-derivative financial instruments NIB classifies non-derivative financial assets into the following categories: loans and receivables and available-for-sale financial assets. NIB classifies non-derivative financial liabilities as other financial liabilities. (i) Non-derivative financial assets and financial liabilities – Recognition and derecognition NIB initially recognises loans and receivables and debt securities issued on the date when they are originated. All other financial assets and financial liabilities are initially recognised on the trade date when the entity becomes a party to the contractual provisions of the instrument. NIB derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred, or it neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control over the transferred asset. Any interest in such derecognised financial assets that is created or retained by NIB is recognised as a separate asset or liability. 43 13

FINANCIAL TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD STATEMENTS Notes to Financial Statements, continued 2018 Year ended March 31, 2018 44 3. Significant accounting policies, continued (a) Non-derivative financial instruments, continued (i) Non-derivative financial assets and financial liabilities – Recognition and derecognition, continued NIB derecognises a financial liability when its contractual obligations are discharged, cancelled or expire. Financial assets and financial liabilities are offset and the net amount presented on the statement of financial position when, and only when, NIB currently has a legally enforceable right to offset the amounts and intends either to settle them on a net basis or to realise the asset and settle the liability simultaneously. The gross carrying amount of a financial asset is written-off (either partially or in full) to the extent that there is no prospect of recovery. This is generally the case when NIB determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to write-off. However financial assets that are written-off could still be subject to enforcement activities in order to comply with NIB's procedures for the recovery of the amounts due. (ii) Non-derivative financial assets – Measurement Loans and receivables Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at amortised cost using the effective interest rate method. The effective interest rate method is a method that is used in the calculation of the amortised cost of a financial asset or a financial liability and in the allocation and recognition of the interest income or interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial asset or financial liability to the gross carrying amount of a financial asset or to the amortised cost of a financial liability. Subsequent to initial recognition loans and receivables held for investment purposes are measured at fair value with changes in fair values recognised in the statement of income, expenses and reserves in accordance with International Accounting Standard (IAS) 26, ‘Accounting and Reporting by Retirement Benefit Plans’. 14

TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD Notes to Financial Statements, continued Year ended March 31, 2018 3. Significant accounting policies, continued (a) Non-derivative financial instruments, continued (ii) Non-derivative financial assets – Measurement, continued Loans and receivables, continued Loans and receivables not held for investment purposes are measured at FINANCIAL amortised cost subsequent to initial recognition. STATEMENTS Loans and receivables comprise: cash and cash equivalents, contributions and 2018 other receivables, short-term investment, long-term receivables and long-term deposits. Cash and cash equivalents comprise cash on hand, cash at investment managers and cash at banks - savings and current accounts. Cash equivalents are short-term highly liquid investments with maturities of three months or less from the acquisition date that are subject to an insignificant risk of change of value and are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. Debt instruments that are not quoted in an active market are classified as loans and receivables. Contributions and other receivables comprise outstanding contributions from private employers and the self-employed, interest receivable and other receivables. Available-for-sale financial assets Available-for-sale financial assets are non-derivative financial assets that are designated as available-for-sale and that are not classified in any of the previous categories. NIB’s investments in equity and debt securities are classified as available-for- sale financial assets. Subsequent to initial recognition, they are measured at fair value and changes therein are recognised as other comprehensive income in the statement of income, expenses and reserves. (iii) Non-derivative financial liabilities – Measurement Non-derivative financial liabilities are initially measured at fair value less any directly attributable transaction costs. Subsequent to initial recognition, these liabilities are measured at amortised cost using the effective interest rate method. NIB’s non-derivative financial liabilities are accounts payable and accrued expenses. 45 15

FINANCIAL TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD STATEMENTS Notes to Financial Statements, continued 2018 Year ended March 31, 2018 46 3. Significant accounting policies, continued (b) Provisions A provision is recognised if, as a result of a past event, NIB has a present legal or constructive obligation that can be reliably estimated, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a rate that reflects current market assessments of the time value of money and the risks specific to the liability. Per IAS 26 NIB has an option as to whether it discloses the actuarial present value of promised retirement benefits on the statement of financial position, in the notes to the financial statements or in an accompanying actuarial report. NIB has elected to disclose the actuarial present value of promised retirement benefits in a note to the financial statements (note 23). The actuarial present value of long-term benefits, other than retirement benefits, was quantified by an independent actuary at March 31, 2017 and 2018 (note 23) and recognised in NIB’s financial statements in accordance with IAS 37, Provisions, Contingent Liabilities and Contingent Assets, and IAS 1, Presentation of Financial Statements. (c) Property and equipment (i) Recognition and measurement Property and equipment are measured at cost less accumulated depreciation and impairment losses (note 3(f)(ii)). Cost includes expenditures that are directly attributable to the acquisition of property and equipment. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. When parts of an item of property and equipment have different useful lives, they are accounted for as separate items (major components) of property and equipment. Gains or losses arising from the disposal of property and equipment are reflected in the statement of income, expenses and reserves. (ii) Subsequent costs The cost of replacing an item of property and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to NIB and its cost can be reliably measured. The carrying amount of the replaced part is derecognised. The cost of the day- to-day servicing of property and equipment is recognised in the statement of income, expenses and reserves, as incurred. 16