Glossary

A | C | L | M | O | P | R | S | T | V

A
	Accrued Benefit The amount of a member's beneficial interest in an MPF scheme at a particular time, calculated as the contributions, made by or in respect of that member, together with any investment return (profit or loss).
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	Approved Trustee The MPFA vets all trustees to ensure that they meet the detailed requirements to be a trustee, such as capital adequacy, independent directors, relevant experience etc. A trustee who has met all of these criteria and been approved by the MPFA will be an approved trustee and can act as a trustee for a master trust, an employer sponsored scheme or an industry scheme.
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C
	Constituent Fund The fund which is the investment vehicle for a registered MPF scheme, or a fund which forms part of the investment vehicles for a scheme.
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L
	Long Service Payment This is a statutory payment under the Employment Ordinance. As far as MPF is concerned, the MPF benefits accrued from employer contributions can be used to offset Long Service Payments.
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M
	MPF Service Provider MPF service provider consists of administrator, custodian and investment manager and other person appointed or engaged by the approved trustee to provide services for the purposes of the scheme.
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	Mandatory Contribution The amount which must be paid as contributions under the MPF. It is calculated as 5% (the percentage may change) of relevant income (with a minimum in respect of employee contributions only, of HK$5,000 and maximum of HK$20,000 per month).
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	Mandatory Provident Fund Schemes Authority (MPFA) The MPFA is responsible for the approving and regulating the affairs and activities of approved trustees and other approved service providers and controlling the operation of MPF registered schemes.
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	Master Trust Scheme In respect of MPF, it is a registered scheme which is available for employees of more than one employer, self-employed persons and persons who have accrued benefits to be transferred from another registered schemes.
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O
	Occupational Retirement Scheme A scheme designed to provide retirement benefits payable on termination of service, death or retirement, to or in respect of persons employed under a contract of service in any employment.
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	Offering Document It is a document containing the necessary information on a master trust scheme, industry scheme or pooled investment fund for prospective scheme participants or fund holders to make an informed judgement.
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P
	Preserved Account It means an account with an MPF scheme (other than a contribution account) in which the accrued benefit in respect of any former employment or former self-employment of the member are held.
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R
	Recognized Stock Exchange In respect of MPF scheme, it means the Stock Exchange of Hong Kong Limited or any stock exchange established in a place outside Hong Kong that is declared by the MPFA by notice published in the Gazette to be a recognized stock exchange.
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	Relevant Income Total of all wages, salary, leave pay, fee, commission, bonus, gratuity, perquisite and allowance expressed in monetary terms. The minimum and maximum threshold for contributions are HK$5,000 and HK$20,000 respectively.
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S
	Securities & Futures Commission (SFC) The statutory body established under the Securities and Futures Commission Ordinance which regulates the securities and futures industry in Hong Kong. In respect of MPF schemes, SFC is responsible for authorizing investment manager, offering document, advertisements and marketing materials of MPF schemes and pooled investment funds.
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	Self-employed Person This means someone who is not an employee, and derives income from the production of goods or services in Hong Kong, or trade in goods or services in or from Hong Kong. This will therefore include people running their own businesses (if they have not formed a company) and professionals (such as doctors and barristers). Self-employed people are also covered under MPF. They must contribute 5% of their relevant income to an MPF scheme. The same maximum and minimum levels of contributions apply as for normal employees.
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	Severance Payment This is a statutory payment under the Employment Ordinance. As far as MPF is concerned, the MPF benefits accrued from employer contributions can be used to offset Severance Payments.
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T
	Total Incapacity It means permanent unfitness to perform the kind of work that the member was performing immediately before becoming incapacitated.
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V
	Vested Vesting refers to the amount of accrued benefit derived from contribution to be paid or payable to employee upon termination of employment, retirement, or other circumstances as allowed to withdraw in the governing rule. In respect of MPF, employees are immediately and fully entitled to accrued benefits derived from employee mandatory and voluntary contribution and employer mandatory contribution. The entitlement of accrued benefits derived from employer voluntary contribution is usually subjected to the governing rules set by the employer.
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	Voluntary Contributions Other than mandatory contributions as required by Mandatory Provident Fund Schemes Ordinance, any additional contributions made by either the employer or the employee member is voluntary contributions. Voluntary contributions made by employer in respect of an employee member are vested in the employee as accrued benefits in accordance with the governing rules of the scheme.
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