Annual Report and Financial Statement 2005
NORSK TILLITSMANN ASA
Annual Report and Financial Statement 2005
| Norsk Tillitsmann
Presenting Norsk Tillitsmann ASA (NTM)
• NTM is characterised by a high level of
competence, with focus on the role as loan
trustee in certificate and bond issues
• NTM monitors the rights of bond and certificate
holders, and contributes to a more efficient and
functioning market for interest-bearing securities
• NTM has, through building competence and system
development, established efficient methods to manage
a substantial number of trustee assignments. At the
turn of the year, this amounted to 1702 assignments,
with an outstanding volume of NOK 424 billion
• NTM provides electronic solutions for the
supply of securities information for the
Norwegian market for interest-bearing securities
through its subsidiary Stamdata AS
• Through its subsidiary Norsk Pensjonsrettighetsregister
ASA, NTM offers a web-based reference
service for pension rights.
• NTM offers services as trustee for
rightholders in fields outside the area of
securities, hereunder as escrow agent
• NTM has a flexible organisation, with expertise in the
fields of law, economics and information systems
Summary and Key Figures (Group)
Assignments/Volume
No. assignments bond issues
(no.)
Outstanding volume bond issues
(NOK billion)
No. assignments certificate issues
(no.)
Outstanding volume certificate issues
(NOK billion)
Results
2004
2003
1620
1478
1316
409
373
340
82
55
50
25
16
13
2005
2004
2003
Total operating income
(NOK million)
33.1
28.1
25.6
Operating result
(NOK million)
11.6
9.4
8.2
Result for the year
(NOK million)
8.5
7.0
6.9
Operating margin
percent
35
34
32
2005
2004
2003
Total capital
(NOK million)
56
52
49
Equity
percent
34
39
50
Return on equity
percent
42
32
29
Balance Sheet
2005
Annual Report and Financial Statement 2005
| Summary and Key Figures (Group)
Manage ment ’s re vie w
Outlook
The business concept of Norsk Tillitsmann ASA (“Norsk Tillitsmann) is
to supervise third party contractual rights on commission. The purpose
of the company is to act as trustee in financial and other contractual
agreements, and to carry out similar or related business, including to
own wholly or partially companies operating in this market.
The company is the dominant participant in the market for trustee
services in interest-bearing securities, and has built substantial
portfolio of trusteeships which provides the basis for stable revenues
and a satisfactory return on equity. The company has a broad
ownership base which allows the company to play an independent
and neutral role in the finance market.
Norsk Tillitsmann continually monitors investor’s rights within the
framework of Loan Agreements and prevailing laws. Minor questions
are generally solved between the Issuer and Norsk Tillitsmann, whilst
more significant decisions are handled at bondholders’ meetings,
after the case has been prepared by the loan trustee. Through its
operations, the company has had to face considerable challenges, and
has gained substantial experience in handling problem assignments
and restructuring loan agreements. In the opinion of the Board of
Directors, the company’s expertise and resources in this field contribute
to strengthening the functionality of the securities market.
In 2005, a number of issues have been established with a higher
level of yield and risk than was previously usual in the bond market
in Norway. These issues have in particular been linked to the oil and
offshore industry. Issues of this kind require the preparation of more
extensive Loan documentation and make higher demands on the
role of the Loan Trustee than more standard issues. In the opinion of
the Board of Directors, the company’s work and role has contributed
to efficient and functional solutions for this type of issue, and that the
Annual Report and Financial Statement 2005
| Outlook
company’s operations have been of importance to the development
of this market.
The general increase in the level of securitisation of the loan markets in
recent years will probably contribute to the certificate and bond markets
continuing to strengthen their position and increase relative share of
credit markets. New regulations which allow finance institutions to
issue ‘special secured bonds’, bonds which in accordance with a set of
regulations, can be backed by a loan portfolio are another example of
this development which in turn could eventually lead to an expansion
of the bond market. Norsk Tillitsmann wishes to play an active role in
the development of new forms of securitisation of credit, with a focus
on establishing the loan documents and relevant collateral documents.
Norsk Tillitsmann undertakes to prepare all the documentation linked
to the establishment of a financial contractual agreement.
In addition to its core activities, the main services offered by
the company comprise the subsidiaries Stamdata AS and Norsk
Pensjonsrettighetsregister ASA, together with the function of trustee
in non-financial agreements, including that of escrow agent in
custodian agreements.
The Board is extremely satisfied with the results achieved in 2005.
Core activity as trustee in loan agreements will continue to be the
company’s dominant business area in the future. Moderate growth
in income is expected from core activities and the operations of
Stamdata AS. The operations of Norsk Pensjonsrettighetsregister are
not expected to show a profit in 2006.
In the opinion of the Board of Directors, the company is well prepared
to fulfil its functions and responsibilities in a reassuring manner, and
has a solid base from which to take on new assignments.
Annual Report and Financial Statement 2005 || Kapitteltittel
Outlook
Manage ment ’s re vie w
Company operations
The year 2005 has been a good year for the company, with improved
financial results and an increase in the number of assignments,
arising from both core activities and other areas of operation.
Growth in net assignments as loan
trustee for Norwegian bonds
The Norwegian bond market was characterised by a high level of
activity in 2005. A total of 530 new issues valued at NOK 97 billion
were made, an increase in 10% compared with the previous year.
In the course of 2005, Norsk Tillitsmann has taken on a total of 428
(373) new trustee assignments for bond issues. Figures in brackets
show comparable figures for 2004. In the same period, 357 (201)
assignments have been concluded such there was a net increase of
71 (172) assignments for the year as a whole.
Of the total number of new assignments, 168 are listed on the Oslo
Stock Exchange.
At the end of the year, Norsk Tillitsmann managed a was engaged
in 1 620 (1 478) trustee assignments for loan agreements for bond
issues. Total outstanding nominal value amounts to just over NOK
409 billion (NOK 375 billion).
Numbers of new and existing assignments
1800
450
1 600
400
1 400
350
1 200
300
1 000
250
800
200
600
150
400
100
200
50
0
0
1999
2000
2001
No. of new assignments
2002
2003
2004
2005
No. of running assignments
The company’s trustee assignments include bonds and certificates
issued by Norwegian municipalities, power utilities, industrial,
shipping and commercial companies, mortgage institutions,
banks and insurance companies together with a number of foreign
issuers. The loan portfolio includes secured and unsecured loans,
subordinated issues, issues convertible into shares in the borrower,
Annual Report and Financial Statement 2005
| Company operations
issues including subscription rights to shares in the issuer, issues which
can be converted into shares in a third party and issues (tranches) in
so-called MTN programmes. As in the previous year, in the course of
2005 a number of structured issues were made in which the yield
is tied to development of one or more share indices, shares, mutual
funds, currency rates or futures contracts for electric power. Some
structured issues have, in addition to the above-mentioned yield, an
annual fixed interest payment.
A particular trend evident in 2005 is the development of the market
to issue high-interest bonds, that is, bonds with a relatively higher
level of yield and risk than is found in the more traditional types of
bond issues. These issues are in particular linked to projects within
the oil and offshore industry.
In 2005, the extent of work with problem issues was limited to minor
situations for a small number of issuers, and continuing work on
issues in default from previous years. There were no new loans in
default registered in 2005. The increasing presence of high-interest
issues in the company’s portfolio of trustee assignments makes higher
demands on the use of resources to monitor the portfolio, with a view
to identifying any problem situations at an early stage.
In addition to the general task of monitoring loan agreements
and dealing with issues in default from previous years, in 2005
the company has worked on ensuring fulfilment of the rights of
bondholders in cases of debtor substitution, mergers, de-mergers
and reductions in subordinated loan capital. Norsk Tillitsmann has
also considered questions concerning issuer’s sale of material assets,
early redemption, adjustment of collateral together with amendment
of clauses concerning ratios and limitations on mortgaging assets.
Convertible issues are also a frequent subject of discussion, often in
connection with interpretation of conversion clauses and adjustment
of conversion price. Likewise, establishing values in connection
with yield calculations for so-called structured issues is an area that
requires special attention.
Trustee function for certificate issues
shows increased activity
In 2005, Norsk Tillitsmann has taken on 148 (104) trustee assignments
for certificate issues. A total of 121 (99) assignments have been
concluded during the year, such that the net increase in assignments
for the year is 27 (5) certificate issues. At the end of the year, the
portfolio comprised 82 certificate assignments, with a total value of
NOK 25 billion. Of the 82 current assignments, 30 are listed on the
Oslo Stock Exchange.
Escrow Agent
The company’s offer of services as escrow agent has continued
in 2005. The background for this service is that in contractual
agreements, situations arise in which it is an advantage for the
Manage ment ’s re vie w
parties to the contract to be able to deposit capital assets with an
independent third party. The company has developed secure and
efficient routines to ensure secure handling of deposits, and prepares
the necessary agreements in Norwegian and English.
of registration of pension rights and carry out related activities’. The
service was started up in the autumn of 2005, and at the start of
2006, has achieved agreements with 8 (0) leading pension funds in
the private and public sector. A number of letters of intent has been
signed which, together with the existing agreements, will be able to
give registration services of over 200 000 pension rights.
Stamdata reports growth in number of customers
The wholly owned subsidiary Stamdata AS offers a service for the
distribution of core information in electronic format for loan capital
instruments registered in the Norwegian Registry of Securities. The
information system comprises an internet-based service, www.
stamdata.no where the complete database is available to subscribers.
Stamdata is also available in the form of an electronic feed to
customers’ own portfolio management systems, updated daily. At
the start of 2006, Stamdata AS had 49 (50) paying subscribers to web
The aim of the company is to give all eligible individuals in Norway
- through a web based reference service - a complete view of accrued
pension rights, including the size of the retirement pension resulting
from the rights. The government’s resolve that each individual in
Norway shall have acess to this type of information is dependent
on receiving the broad support by pension funds for voluntary
registration of this information. In the opposite case, the government
will probably introduce legislation enforcing registration of pension
services and 15 (14) feed customers. The number of users of web
services is, however higher, as all customers with the feed solution
also have web access included in their subscription. The number of
web customers is declining as a direct result of customers considering
transferring to electronic feed services.
rights. Norsk Pensjonsrettighetsregister ASA is prepared to apply for a
concession to operate a legally required register in the event that this
is introduced by the authorities.
Other services
www.stamdata.no is the information page for Norsk Tillitsmann which
at any time displays all relevant documents linked to each bond and
certificate issue. Starting this year, statistics of lead managers’ issue
activity in the Norwegian certificate and bond market will also be
available.
Norsk Pensjonsrettighetsregister ASA
Norsk Pensjonsrettighetsregister ASA was established in 2004 as a
subsidiary of Norsk Tillitsmann ASA. The company’s objective is ‘on
an independent and impartial basis, to provide services in the form
Annual Report and Financial Statement 2005
| Company operations
The company offers flexible solutions for the electronic registration
of unit holders, members and others who require registration in an
efficient and secure manner. This service is easily combined with the
services offered as trustee in other financial agreements
For borrowers required by the terms of Securities Trading Act to
publish a prospectus in connection with bond issues, the company
offers the service to prepare prospectuses in co-operation with the
lead manager. Norsk Tillitsmann can thus provide a complete service
covering all aspects of establishing necessary documentation required
for issuance of interest-bearing securities in the Norwegian market.
Manage ment ’s re vie w
Profit and loss account
and the balance sheet for 2005
The figures for the parent company vary only slightly from group
figures. Comments and key figures are therefore linked to the Norsk
Tillitsmann ASA group. The accounts are prepared on the assumption
of continued operations. All figures are group figures. Equivalent
figures for 2004 are shown in brackets.
The profit and loss account
In 2005, Norsk Tillitsmann reported operating income of NOK 33
112 million (NOK 28 080 million), equivalent to an increase of 18 %
compared with the previous year. The main reason for the growth in
income is the growth in the number of trustee assignments achieved
in recent years.
The accounts for 2005 show an operating profit of NOK 11 576 million
(NOK 9 441 million), which represents an increase of NOK 2 135 million
(NOK 1 279 million) compared with the previous year.
Financial items show a positive result of NOK 1 198 million (NOK 1
058 million) giving pre-tax profits for the year of NOK 12 774 million
(NOK 10 499 million). A tax charge of NOK 4 365 million (NOK 3 456
million) has been applied, resulting in profit after tax of NOK 8 409
million (NOK 7 043 million). This represents a return on equity of some
42 % and earnings per share of NOK 78 (NOK 60.72).
The balance sheet
assets is on deposit with Norwegian banks whilst NOK 7 604 million
(NOK 7 604 million) is invested in Norwegian government bonds.
Trusteeship fees are normally due annually in advance. In the
accounts, the fees are accrued monthly in the period between each
due date. Trustees fees that are invoiced but not taken to income are
capitalised as short-term debt under the item ‘prepaid trusteeship
fees’. At the end of 2005, this item totalled NOK 15 641 million (NOK 13
612 million). Prepaid trusteeship fees are taken to income successively
throughout the year.
The group’s expenses arising from the establishment of data systems,
including for Norsk Pensjonsrettighetsregister ASA are charged to the
accounts successively.
There have been no significant developments since the end of the
year which could have an adverse effect on the accounts.
Capital adequacy
Book equity for the group at the end of 2005 was NOK 19 198 million
(NOK 20 495 million), equivalent to an equity ratio of 34.4% (39.3%).
In addition to equity, the parent company has capital indemnity
insurance policy limited to a maximum of NOK 50 million, including
terms which cover those liabilities the company may incur in its
position as trustee.
Turning to the balance sheet, it is evident that current assets
amounting to NOK 51 404 million (NOK 47 759 million) account for
most of the company’s total assets of NOK 55 789 million (NOK 52 161
million). A total of NOK 36 576 million (NOK 34 407 million) of current
Annual Report and Financial Statement 2005
In the opinion of the Board of Directors, the company has sufficient
capital to carry out the functions represented by its areas of business
operations.
| Profit and loss account and the balance sheet for 2005
Manage ment ’s re vie w
The Board and management
Following the annual general meeting in held in 2005, the Board of
Directors has comprised Johan Salbu Braaten (chairman), Lidar Jan
Pollestad, Lars Tronsgaard, Berit Stokke (new) and Mette Cecilie Skaug
(new).
Finn Myhre, who has held the position of Chairman of the Board since
the company was estabilshed in 1993 and Maria Borch Helsengreen
who has been a Board member since 2003, stepped down from the
Board in connection with the Ordinary General Meeting in 2005. The
Board wishes to thank the departing Board members for their efforts
through their activities as Board members and would like to offer a
special thanks to Finn Myhre for his decisive role in the development
of the company and his substantial contribution through 12 years as
company Chairman.
Norsk Tillitsmann has placed much emphasis on securing and
further developing the necessary competence and expertise in the
fields of law, economics and technology, in order to carry out its
operations in a competent and rational manner. At the end of the
year, the company had 11 full-time employees. In addition, Norsk
Pensjonsrettighetsregister has one employee. In the opinion of the
Board, the company is well prepared to meet the challenges waiting
in the future.
The eleven employees as at the end of the year comprise 5 women and
6 men. The company strives to have a conscious approach towards
equal opportunities for both women and men from their respective
Annual Report and Financial Statement 2005
| The Board and management
starting points, through recruitment, organisation, promotion and
training. To the extent that the company’s business and operations
allow it, the company offers its employees flexible working hours.
The operations of the parent company and its subsidiaries are carried
out in modern premises at 1, Haakon VII street, in Vika, Oslo.
The working environment within the company is good. For 2005 as a
whole, absence due to sickness accounted for 3.6% of total working
hours. This figure is substantially higher than previous years, and is
due to one case of extended sick leave. No accidents or injuries have
occurred in connection with the company’s operations. To the best
of the Board’s knowledge, the company’s activities do not cause any
environmental pollution.
The Board wishes to thank the employees for their wholehearted
commitment throughout the year.
Details of shareholdings by Board members and employees are found
under note 11.
Details of remuneration made to the managing director and the Board
members can be found under note 2 to the accounts. Note 3 covers
auditor’s fees.
10
Annual Report and Financial Statement 2005
| Profit allocation
Manage ment ’s re vie w
Profit allocation
The Board recommends payment of a dividend of NOK 90 per share.
The profit for the year for Norsk Tillitsmann is proposed allocated as follows:
Allocated to other equity
NOK
494 459
Dividend payment
NOK
9 705 330
Total allocated
NOK
10 199 789
Oslo, 8 March 2006
On the Board of Norsk Tillitsmann ASA
Lidar Jan Pollestad
Johan Solbu Braaten
Chairman
Mette Cecilie Skaug
Lars Tronsgaard
Ragnar Sjoner
CEO
11
Annual Report and Financial Statement 2005 | Profit allocation
Berit Stokke
Norsk tillits mann ASA
Profit & Loss account
Group
Note
2005
Norsk Tillitsmann ASA
2004
2005
2004
OPERATING INCOME
Trusteeship fees and other income
1
Total operating income
33 112 549
28 080 019
32 431 728
27 957 519
33 112 549
28 080 019
32 431 728
27 957 519
13 626 859
11 669 479
OPERATING COSTS
Wages, holiday pay etc.
2
14 786 392
12 115 347
Fees
3
1 721 562
2 292 264
826 965
1 181 645
1 756 386
1 937 210
1 755 150
1 937 210
Rent, service charge and power
Other administrative costs
4
2 651 876
1 805 382
2 442 833
1 743 653
Ordinary depreciation
5
632 431
471 668
626 459
470 175
Loss on receivables
6
- 12 443
16 943
- 12 443
12 443
Total operating costs
21 536 204
18 638 815
19 265 823
17 014 605
Operating result before financial items
11 576 345
9 441 205
13 165 905
10 942 914
1 217 733
1 096 032
1 265 241
1 086 562
FINANCIAL ITEMS
Financial income
Financial expenses
Net financial items
Pre-tax profit for the year
20 076
37 964
20 015
37 384
1 197 657
1 058 069
1 245 226
1 049 178
12 774 002
10 499 273
14 411 131
11 992 092
Tax payable
13
4 520 473
3 383 105
4 366 606
3 377 648
Change in deferred tax
13
- 155 264
72 932
- 155 264
18 688
Total tax charge
4 365 209
3 456 036
4 211 342
3 396 336
Annual result after tax
8 408 793
7 043 237
10 199 789
8 595 756
- 318 878
- 255 942
Of which minority interests
15
YEAR END ALLOCATIONS
Dividend payment
11
Allocated to free reserves
Earnings per share
All figures in NOK
12
Annual Report and Financial Statement 2005
| Profit & Loss account
9 705 330
8 087 775
9 705 330
8 087 775
-1 296 537
-1 044 538
494 459
507 981
77,98
60,72
94,59
79,71
Norsk tillits mann ASA
Balance Sheet as at 31.12.05
Group
Note
Norsk Tillitsmann ASA
2005
2004
2005
2004
ASSETS
Fixed assets
Machinery, fittings etc
5
1 663 067
1 435 623
1 652 615
1 419 199
Shares in subsidiaries
7
0
0
3 700 000
2 700 000
Subordinated loan in subsidiaries
7
0
0
1 058 122
0
Long term assets
8, 14
2 719 679
2 965 600
2 719 679
2 965 600
4 382 746
4 401 223
9 130 417
7 084 799
6 199 059
5 050 592
5 271 105
4 891 032
1 421 220
697 442
1 420 270
697 443
Total fixed assets
Current assets
Accounts receivable
6
Other current assets
Securities
10
7 604 000
7 604 000
7 604 000
7 604 000
Cash, bank and postal giro deposits
9
36 575 538
34 407 302
35 641 201
32 466 054
Total current assets
51 799 817
47 759 337
49 936 577
45 658 529
Total assets
56 182 563
52 160 560
59 066 993
52 743 328
LIABILITIES AND EQUITY
Equity
Share capital
11, 12, 15
10 783 700
10 783 700
10 783 700
10 783 700
Other capital
15
8 414 299
9 666 778
11 524 314
11 029 855
Minority interests
15
0
44 058
19 197 999
20 494 536
22 308 014
21 813 555
13
124 086
279 350
124 086
279 350
14
1 934 000
1 676 000
1 934 000
1 676 000
1 934 000
1 676 000
1 934 000
1 676 000
Total equity
Deferred tax
Long term debt
Pension liabilities
Total long term debt
Short term debt
Accounts payable
Calculated, unassessed taxes
13
Unpaid income tax deducted at source, employers Nat. Ins.
319
961 052
0
240 768
4 530 322
3 383 105
4 366 606
3 377 648
2 414 643
2 694 847
2 330 526
2 746 837
Allocated to dividend payments
11
9 705 330
8 087 775
9 705 330
8 087 775
Prepaid trusteeship fees
1
15 640 796
13 611 769
15 640 796
13 611 769
1 851 324
851 821
1 851 324
851 821
503 539
484 627
390 000
390 000
Total short term debt
34 926 478
29 710 674
34 700 893
28 974 423
TOTAL LIABILITIES AND EQUITY
56 182 563
52 160 560
59 066 993
52 743 328
Accrued wages, holiday pay etc.
Accrued costs
All figures in NOK
Johan Solbu Braaten
Chairman
Oslo, 8 March 2006
On the Board of Norsk Tillitsmann ASA
Lidar Jan Pollestad
Berit Stokke
Ragnar Sjoner
CEO
13
Annual Report and Financial Statement 2005
| Balance Sheet as at 31.12.05
Mette Cecilie Skaug
Lars Tronsgaard
Cash Flow analysis
Group
Profit for the year
2005
2004
2005
2004
8 408 793
7 043 237
10 199 789
8 595 756
+
Ordinary depreciation
632 431
471 668
626 459
470 175
+
Losses on receivables
- 12 443
16 943
- 12 443
12 443
=
Generated from operations
9 028 781
7 531 848
10 813 805
9 078 375
+
Changes in accounts receivable an accounts payable
-2 505 187
- 539 445
-620 840
-1 128 069
+
Change in pension commitments
+
Change in prepaid trustees fees
+
Change in other short term items
= (A)
Net source of funds from operations
Investments in fixed assets
+
= (B)
Investments in stocks
Net change in funds from investments
Loan to subsidiary
36 000
503 921
36 000
2 219 139
2 029 027
2 219 139
2 059 343
306 289
1 455 007
38 024
11 115 885
9 553 831
14 180 919
10 243 469
- 859 875
-1 011 666
- 859 875
- 993 749
0
0
-1 000 000
-1 700 000
- 859 875
-1 011 666
-1 859 875
-2 693 749
0
0
-1 058 122
0
-5 220 000
-8 087 775
-5 220 000
Net acquisition/sale own shares
0
-3 457 412
0
-3 457 412
Dividend received on own shares
0
367 335
0
367 335
Share issue minority interests
0
300 000
0
0
-8 087 775
-8 010 077
-9 145 897
-8 310 077
Dividend paid
+
+
+
A+B+C
503 921
2 029 027
-8 087 775
+
= (C)
14
Parent company
Net change in funds from financing
2 168 235
532 088
3 175 146
- 760 357
+
Net change in liquid assets for the year
Liquid assets as at 01.01
42 011 302
41 479 215
40 070 056
40 830 413
=
Liquid assets as at 31.12
44 179 537
42 011 302
43 245 202
40 070 055
Annual Report and Financial Statement 2005
| Kontantstrømanalyse
NOTER Norsk tillits mann ASA
Notes
The annual accounts are prepared in accordance with the requirements
of the Accounting Act of 1998, and generally accepted accounting
principles.
All figures are in NOK.
Basis of consolidation
Group accounts include the parent company Norsk Tillitsmann ASA
and its subsidiaries Stamdata AS and Norsk Pensjonsrettighetsregister
ASA. Group accounts are prepared on the basis that the group is a
single economic entity. Inter-company balances and transactions have
been eliminated. Group accounts are prepared according to uniform
principles, in that Stamdata AS and Norsk Pensjonsrettighetsregister
ASA apply the same accounting principles as the parent company.
Fixed operating assets
Fixed operating assets are treated as balance sheet items, and are
depreciated over the expected life of the asset. Expenses relating
to maintenance of fixed assets are treated as operating costs, whilst
expenses arising from refurbishment or improvements are added to
the acquisition cost and depreciated over the life of the asset.
Tax
The tax charge appearing in the profit and loss account covers both
assessed taxes for the period, and changes in deferred tax. Deferred
tax is calculated at 28%, based on the interim differences existing
between book and taxable values, and the loss carried forward for tax
purposes at the end of the accounting year. Interim differences leading
to increases or decreases in taxes which will, or can be reversed during
the same period, are equalised. Net deferred tax benefits are entered
in the balance sheet, to the extent that it probably can be utilised.
Classification and evaluation of balance sheet items
Transactions and items that are due for payment within a year from the
point of acquisition, together with items arising from stock turnover
are classified as current assets and short term debt. Other items are
classified as fixed assets/ long term debt.
Current assets are valued at the lower of acquisition cost and market
value. Short term debt is valued at its nominal principal amount.
Long term assets are valued at acquisition cost, but are written down
to market value by reductions in value not perceived as temporary.
Long term debt is valued at its nominal principal amount.
Accounts receivable
Trade debtors and other accounts receivable are entered into the
balance sheet at their face value, less provisions for anticipated losses.
Provisions for losses are made on the basis of individual assessment of
each item. In addition, an unspecified provision is made to cover any
other losses on receivables.
15
Annual Report and Financial Statement 2005
| Notes
Pensions
Effective 1 July 2004, Norsk Tillitsmann ASA converted to an
Contribution-based Pension plan. This means that existing Benefitbased pension cover has been discontinued. Payments to the
Contribution-based pension plan are charged to the accounts
as regularly, through monthly transfers to the pension fund.
Overfinancing of the previous plan has been charged to the balance
sheet under the item long term receivables.
There is one existing pension commitment not covered by the
Contribution system. In booking this item, the commitment is
calculated on the basis of a linear accrual, and the expected future
final salary rate as a basis of earning. The size of the commitment is
specified in the balance sheet.
NOTE 1 - Income
Operating income for the year is as follows:
Group
Specifications
Trustees fees
Parent company
2005
2004
2005
2004
29 328 074
25 144 863
29 328 074
25 144 863
1 521 000
1 182 500
0
0
+
Fees from sales of data/web services
+
Fee from Stamdata AS
0
0
960 000
960 000
+
Fee from Norsk Pensjonsrettighetsregister ASA
0
0
240 000
100 000
+
Skattefunn midler
359 821
0
0
0
+
Other fee income
1 903 655
1 752 656
1 903 655
1 752 651
33 112 550
28 080 019
32 431 729
27 957 519
=
Trustees fees and other income
Trustees fees are payable annually in advance. The fee is accrued on a monthly basis in the period between each due date.
Trustees fees paid but not taken to income are capitalised as current liabilities under the item “prepaid trusteeship fees”.
NOTE 2 – Wages
Group
Specification of wages
Parent company
2005
2004
2005
2004
Wages
9 127 814
8 550 463
8 149 284
8 177 128
Employers Nat. Ins. Contributions
1 980 314
1 618 331
1 831 836
1 563 164
Pension Costs
1 388 877
707 286
1 405 542
690 621
2 289 388
1 239 266
2 240 198
1 238 566
14 786 392
12 115 347
13 626 859
11 669 479
12
13
11
12
Other benefits
Total wages
Number of employees
The Managing Director received a salary of NOK 1 253 195 in 2005 plus a fixed car allowance of NOK 108 000. In addition, the Managing Director
received NOK 500 000 in the form of a bonus payment and pension premiums totalling NOK 234 738 were covered by the company. The Managing
Director has a 6 month period of notice and the right to take early retirement from the age of 62 years, on condition that his services are available
to the company should the need arise, until the age of 67 years.
NOTE 3 - Fees
An allocation of NOK 340 000 has been made in the accounts for 2005 to cover remuneration to members of the Board of Directors, equivalent to
actual remuneration paid to Board members in 2004.
The accounts for 2005 include a provision of NOK 50 000 to cover auditor’s fees. Total auditors fees for the group are calculated as follows:
Norsk Tillitsmann ASA:
Audit fees
NOK
43 000
Advisory services
NOK
9 500
Expenses
NOK
500
Total
NOK
53 000
NOK
7 000
Audit fees:
NOK
15 000
Total Group
NOK
75 000
Stamdata AS
Audit fees
Norsk Pensjonsrettighetsregister ASA:
16
Annual Report and Financial Statement 2005
| Notes
NOTE 4 - Other Administrative Costs
Consultant fees
NOK
710 019
Conferences and representation
NOK
444 657
Office supplies
NOK
368 207
EDB expenses
NOK
313 089
Insurances
NOK
298 251
Telephone and postages
NOK
296 626
Other costs
NOK
11 985
Total
NOK
2 442 833
NOTE 5 - Machinery, inventory, trusteeships taken over
Acquisition cost as at 1.1
Office
machinery etc.
Fittings,
equipment
Vehicles
TOTAL
2 505 919
1 348 538
0
3 854 458
Additions during the year
277 599
289 630
292 646
859 875
Disposals during the year
0
0
0
0
Acquisition cost as at 31.12
2 783 518
1 638 169
292 646
4 714 333
Accumulated depreciation as at 1.1
1 581 418
853 841
0
2 435 259
Ordinary depreciation
484 814
136 767
4 877
626 459
Book value as at 31.12
717 286
647 561
287 769
1 652 615
Fixed assets are valued at historical cost price less linear depreciation. Office machinery is depreciated on a linear basis over three years. Fittings and
equipment are depreciated on a linear basis over 5 years. Vehicles are depreciated at 20% of acquisition cost annually.
NOTE 6 - Accounts receivable/losses on claims
Accounts receivable are entered in the balance sheet at book value. There are no losses incurred in 2005. A receivable of NOK 12 443 which had
previously been written off was settled in 2005.
NOTE 7 – Shares in subsidiaries
Stamdata AS, was established on 8 January 2001 with share capital of NOK 100 000.- The share capital was increased to NOK 1 000 000 in 2002.
Norsk Tillitsmann ASA holds 100% of the shares, and has controlled 100% of the voting rights since the establishment of the subsidiary. The shares
are valued in the accounts for Norsk Tillitsmann at cost price, NOK 1 000 000. Stamdata AS reported a pre-tax profit for 2005 of NOK 549 465.
An agreement has been made between Norsk Tillitsmann ASA and Stamdata AS, covering the delivery of data and administrative services. Total fee
from Stamdata AS amounted to 960 000 in 2005. The amount is entered in the accounts of the parent company under other fee income.
Norsk Pensjonsrettighetsregister ASA (NPR) was established on 11 August 2004, with a share capital of NOK 2 000 000. The share capital was
increased to NOK 3 000 000 in 2005, through the conversion by Nork Tillitsmann ASA of NOK 1 000 000 subordinated loan capital into share capital.
Following the share capital increase, Norsk Tillitsmann ASA owns 90% of NPR, whilst the company’s general manager, Åsmund Paulsen owns the
remaining 10%. The shares in NPR are valued in the accounts of Norsk Tillitsmann ASA at cost price, NOK 2 700 000. The accounts for NPR for 2005
show a pre-tax loss of NOK 2 186 595.
Stamdata and NPR operate from the same office premises as Norsk Tillitsmann ASA, at 1, Haakon VII st. Oslo.
17
Annual Report and Financial Statement 2005
| Notes
NOTE 8 - Long term assets
Book value of long term assets comprises the following items:
Pension capital
Deposit on premises
Deposit
Total long term assets
2005
2004
2 516 079
2 762 000
200 000
200 000
3 600
3 600
2 719 679
2 965 600
NOTE 9 - Restricted deposits
Restricted bank deposits comprises income tax deducted at source and totalled
NOK 543 873 as at 31.12.2005 (NOK 1 029 900 as at 31.12.2004).
NOTE 10 - Securities
Holding
Final redemption
Nominal value
Acquisition cost
Book value
Market value as
at 31.12.2005
15.05.2009
8 000 000
7 604 000
7 604 000
8 548 000
7 604 500
7 604 000
8 548 000
5,5% Norsk Stat 97/09 (S468)
Interest on Government bonds is fixed until final redemption date.
Holdings of securities are valued at the lower of acquisition cost and market value.
NOTE 11 - Share capital
As at 31.12.2005, the company’s share capital was NOK 10 783 700 divided into 107 837 shares of NOK 100 nominal.
A dividend payment of NOK 90 per share has been proposed. Total allocation for dividend payment is NOK 9 705 330.
As at 31.12.2005 the following were shareholders in Norsk Tillitsmann ASA (according to size of holding in decreasing order).
Share holders
No. shares
Percent
DnB NOR Bank ASA
15 039
13.95%
Nordea Bank Norge ASA
11 223
10.41%
KLP Forsikring
11 175
10.36%
Storebrand Livsforsikring AS
11 175
10.36%
Vital Forsikring ASA
11 175
10.36%
Frimal AS
11 000
10.20%
Pareto AS
5 925
5.49%
SEB Merchant Banking Oslo
5 000
4.64%
L.D.C. Trust Management Ltd
4 470
4.15%
Sparebanken Vest
4 000
3.71%
Carnegie ASA
2 975
2.76%
Sparebank 1 Livsforsikring AS
2 490
2.31%
Terra Markets AS
2 240
2.08%
Fokus Bank ASA
1 495
1.39%
Stiftelsen Najaden
1 490
1.38%
Vestfold Sparebank
1 490
1.38%
Sparebanken Sør
1 000
0.93%
Fearnley Fonds ASA
750
0.70%
ABG Sundal Collier Norge ASA
745
0.69%
Aker Invest II KS ASA
745
0.69%
Alfred Berg Norge ASA
745
0.69%
DnB NOR Kapitalforvaltning ASA
745
0.69%
SEB Enskilda ASA
745
0.69%
18
Annual Report and Financial Statement 2005
| Notes
NOTE 12 - Shares held by board members/employees
Companies controlled by Managing Director Ragnar Sjoner and family own 11 000 shares in Norsk Tillitsmann ASA. None of
the other Board members or any of the company’s employees owned shares in Norsk Tillitsmann ASA as at 31.12.2005.
NOTE 13 - Tax
Group
Assessed taxes for 2005
Tax charge 28%
Change in deferred tax
Assessed tax
Calculation of tax base for 2004
Result before tax charge
Permanent differences
Change in interim differences
Tax base
Interim differences
Receivables
Securities
Fixed assets
Pension commitments
Norsk Tillitsmann ASA
2005
2004
2005
2004
4 520 473
3 383 105
4 366 606
3 377 648
-155 264
72 931
-155 264
18 688
4 365 670
3 456 036
4 211 342
3 396 336
2005
2004
2005
2004
12 774 002
10 499 275
14 411 131
11 992 091
269 554
137 430
629 375
137 679
3 100 956
1 445 812
554 515
-66 742
16 144 512
12 082 517
15 595 021
12 063 028
2005
2004
2005
2004
21 887
52 319
21 877
52 319
0
0
0
0
-159 115
-136 718
-160 752
-140 600
-1 934 000
-1 676 000
-1 934 000
-1 676 000
2 761 959
Pension premium fund
2 516 038
2 761 959
2 516 038
Losses carried forward
-4 254 369
-1 710 163
0
0
Net interim differences
-3 809 559
-708 603
443 163
997 678
Interim differences not included in Calculation of deferred tax
4 254 369
-1 706 281
0
0
Tax base for calculation of deferred tax
443 173
997 678
443 163
997 678
Deferred Tax
124 088
279 350
124 086
279 350
All figures in NOK 1000.
19
Annual Report and Financial Statement 2005
| Notes
NOTE 14 - Pension commitments
The company has a contribution-based pension scheme, in which contributions are paid in on a regular basis to Vital Forikring ASA, where the
pension fund is currently placed. The General Manager has an agreement with the company securing the right to a pension on early retirement
on reaching the age of 62 years. This liability is not insured.
Following termination of the group benefit-based insurance scheme, the company had a pension premium fund whiah amounted to NOK 2
516 079 at the end of 2005.
In the accounts, the pension fund and pension liabilities linked to early retirement benefits are booked gross. The pension fund can be used to
cover premium payments to pension contributions.
Pension Cost
2005
2004
Payment to pension contribution
795
378
Pension cost for early retirement
258
238
Payment to benefit-based scheme before termination
277
Termination gain on contribution plan
-201
Net pension cost
1 053
692
2005
2004
1 676
1 438
152
144
Interest charge
84
72
Variation in estimates
22
22
1 934
1 676
2005
2004
Opening balance
Interest on pension capital
Net Pension Liabilities
Discount rate
5%
5%
Expected annual wage increase
3,3 %
3,3 %
Expected annual pension increase
2,5 %
2,5 %
Expected adjustment of National Insurance Fund’s basic amount
2,5 %
2,5 %
6%
6%
Expected return on capital
All figures in NOK 1000.
Actuarial assumptions with respect to demographic factors are based on assumptions normally used in insurance
20
Annual Report and Financial Statement 2005
| Notes
NOTE 15 - Equity
Share
capital
Other
equity captial
Paid in
capital
Sum
10 783 700
9 834 360
1 195 497
21 813 555
Result for the year
0
10 199 789
0
10 199 789
Dividend allocation
0
-9 705 330
0
-9 705 330
10 783 700
10 328 819
1 195 497
22 308 014
Share
capital
Other
equity captial
Paid in
capital
Minoritets
interesse
Sum EK
10 783 700
8 471 283
1 195 497
44 060
20 494 536
Norsk Tillitmann ASA
Equity as at 31.12.04
Total as at 31.12.05
Norsk Tillitsmann Group
Equity as at 31.12.04
Result for the year
0
8 727 210
0
0
8 727 671
Dividend allocation
0
-9 705 330
0
0
-9 705 330
Minority interests’ share of result
0
0
0
-318 878
-318 878
Proportion of minority interest withdrawn
from majority share
0
-274 818
0
274 818
0
10 783 700
7 218 345
1 195 497
0
19 197 999
Total as at 31.12.05
21
Annual Report and Financial Statement 2005
| Notes
22
Annual Report and Financial Statement 2005
| Revisjonsberetning