7. Support Services Division

• 7.1 Human Resource

• 7.2 Administration

• 7.3 Finance and Accounts

The Support Services Division (SSD) is concerned with facilitating the overall operations of the Commission. It provides necessary support services that assist in effi dent and smooth functioning of the organization. The core activities include staff recruitment and development, maintenance and refurbishment of office premises, procurement, disbursements and preparation of financial records and accounts. The SSD has been organized into the following wings:

(i) Human Resource

(ii) Administration

(iii) Finance and Accounts

The main functions of the Human Resource Wing are formulation of personnel policies and procedures; recruitment of suitably qualified personnel and processing of employees' transfers, retirements, resignations, inquiries and dismissals; coordination with other Divisions on matters of staff development; organization of local and foreign training programs; and maintenance of employee service records including performance evaluation reports. In performing its functions, the Human Resource Wing is guided by the need to maintain employee morale and motivation.

The recruitment process has been formalized to ensure transparency and objectivity. Candidates are selected purely on merit after considering the particular needs and work requirements of each Division. Pay packages offered to successful candidates are largely commensurate with the market. An increase of up to 25 percent in salaries of the Commission's employees is under consideration in order to make the remuneration structure more competitive.

In recruiting staff, emphasis is placed on induction of qualified professionals in accordance with the corporate plan. Since the establishment of the Commission on January 1,1999, as many as 100 professionally qualified individuals have been inducted and appointed at varying levels of authority and responsibility. During the year under review, 32 new employees were recruited, of whom three were chartered accountants, two cost and management accountants, three law graduates while 21 held post-graduate degrees.

The Commission is an equal opportunity employer. In continuing with its policy to ensure equal opportunities to female candidates, 22 female officers were inducted during the year under review. This represents almost 70 percent of the total induction during the year and has significantly improved the state of gender balance among the Commission's employees.

During the year under review, the Commission introduced a Junior Executives Induction Scheme (JEIS) to attract highly motivated, young individuals who have post-graduate degrees from reputable institutions. The JEIS provides these freshly qualified individuals a starting point for their careers. The scheme is expected to contribute to their professional growth through on-the-job-training and exposure to the Commission's functioning and policies. During the financial year 2002, the first batch offive Junior Executives was hired under the JEIS. The scheme was publicized through advertisements in newspapers and generated considerable interest among post-graduate degree holders. This was evident from the massive number of applications received for placement in the scheme - more than 900 applications were received for five positions. After careful scrutiny of applications, a competitive examination for 255 short listed candidates was arranged. The examination papers were developed and marked by the Institute of Business Administration, Karachi to ensure a high standard as well as impartiality in the selection process.

The Junior Executives selected under the scheme underwent a one-week orientation on the structure and functions of the Commission. They were then assigned work in different Divisions of the Commission based on academic background, personal preference and the Commission's internal staffing requirements. During the initial

period of one year, each Junior Executive would be rotated in two Divisions. They would also be sent on field trips to stock exchanges, CROs and other relevant institutions. It is expected that the hands-on training thus imparted would enable Junior Executives to obtain a broad overview of the Commission's working. At the conclusion of the first year, these Junior Executives would be offered permanent positions in the Commission based on their performance evaluation.

The second batch of Junior Executives under the JEIS will be inducted during 2002-2003. Applications have been invited from interested candidates for the purpose.

The Human Resource Wing arranged a number of training programs throughout the year under review. The training programs were conducted in-house as well as in collaboration with other institutions to update professional knowledge and enhance technical expertise of employees. These programs were designed to supplement on-the-job training of employees so that they are able to accomplish their tasks more diligently and efficiently.

The training sessions arranged during the year were as follows:

2001 in which 25 officers participated. The Human Resource Wing is

contemplating holding a similar program in the coming year. (ii) Mr. James Smith, consultant to the ADB, was invited to deliver lectures on

"Insurance Reforms/ Regulations" in March 2002. The lectures were attended

by 15 officers of the Commission. (iii) A workshop on "Corporate Governance" was organized by Lahore University

of Management Sciences (LUMS) in April 2002, which was attended by 20

officers of the Commission. (iv) A workshop on "Art of Judgment Writing" was organized at LUMS in April

2002 with the objective of improving the skills of participants in judgment and order writing. Several Commissioners and Executive Directors, along with 20 other officers, attended the workshop.

Institutional Capacity" aimed at familiarizing the 30 officers participating in it with key aspects of economics, law, finance, accounting and regulatory requirements.

The Human Resource Wing also arranged participation of officers of the Commission in seminars and conferences organized by different institutions. The Commission was represented by nominated officers on these occasions to present the view point of the regulator. Significant seminars and conferences in which officers of the Commission participated actively during the course of the year are as follows:

(i) Seminar on Demutualization of Stock Exchanges held in Manila, Philippines in August 2001;

(ii) Public Pension Funds Management Conference in Washington D.C., USA in September 2001;

(iii) Seminar on Code of Corporate Governance organized by Overseas Investors' Chambers of Commerce and Industry in Islamabad in November 2001;

(iv) Seminar on Income Tax Ordinance, 2001 held in April 2002 at ICMAP in Islamabad;

(v) First Conference on Corporate Governance in Asia held in Kuala Lumpur, Malaysia in April 2002;

(vi) Annual Conference of International Organization of Securities Commissions (IOSCO) held in Istanbul, Turkey in May 2002;

(vii) Seminar on Trade Remedy Laws of the World Trade Organization conducted by ICMAP in June 2002 in Islamabad; and (viii) Seminar on Anti Money Laundering and Debt Recovery held in Male, Maldives in June 2002.

The Commission also arranged overseas training for its officers whose participation in international forums, such as the ones mentioned above, served to strengthen its regulatory capacity. These opportunities enable participants to remain abreast with major international developments and engage in dialogue with key players in other jurisdictions. The officers of the Commission who attended the international seminars and conferences were encouraged to share the information and experience so gained with their colleagues through in-house presentations.

The Commission has developed and implemented a Service Manual to provide guidelines for appointment of staff, their pay scales and allowances, training, career planning, retirement, terminal benefits, medical facilities as well as their conduct, efficiency and discipline. During the year, the Service Manual was reviewed and appropriately amended to address practical difficulties in implementing some of its guidelines. The revised Manual now contains a number of provisions that are aimed at staff welfare.

During the year under review, the Human Resource Wing developed formats for the following documents, which are required to be maintained under the Service Manual.

The Pension Papers for employees of the Commission were prepared pursuant to registration of the Employees Pension Fund Trust and framing of the Pension Fund Rules with the approval of the Commission. The Pension Papers designed by the Human Resource Wing have been approved by the trustees of the Fund.

The Human Resource Wing drafted a form for maintaining complete service record of the Commission's employees. It is clearly stipulated in the Service Manual that complete record of service of each employee should be kept in such form as the Commission may determine and should be attested by an officer authorized by the Commission in this behalf. The Human Resource Wing developed a form for this purpose after a comparative study of the service book formats prescribed by several other institutions and agencies. It is expected that in due course the complete service record of each employee of the Commission would be transferred on to this form.

The Commission has obtained the services of a qualified medical specialist to ascertain medical fitness of new employees as well as to perform an annual medical checkup of existing employees. The first round of these check-ups was performed during the year under review and will be continued in subsequent years.

The Administration  on Wing within the SSD is responsible for providing various support services relating to purchase and lease of vehicles, equipment, furniture and fixtures;

hiring and maintenance of office premises; mail receipts and deliveries; transportation;

and printing of reports. The Administration Wing is actively involved in maintaining necessary administrative support to the Divisions and CROs. During the year under review, the focus of administrative services remained on improvement of office decor and establishment of funds for providing staff retirement benefits.

During the year, the Administration Wing undertook refurbishment and modernization of CROs in Lahore, Islamabad and Peshawar. The offices at these stations have been renovated and now provide a conducive and modern work environment.

Necessary refurbishment was also carried out at the Commission's Headquarters in Islamabad.

During the year, essential equipments, like photocopiers and fax machines, were also provided to each Division in Headquarters and to CROs for their capacity building.

The administrative policies and procedures of the Commission are being formalized. For this purpose, a manual has been drafted by consultants engaged under a technical assistance project of the ADB. The manual provides a framework for efficient administrative support and chalks out specific policies and procedures, as approved from time to time. In particular, the manual contains policies and procedures relevant to procurement, maintenance and outsourcing.

During the year under review, the Commission reviewed its procurement policy to streamline it and make it more transparent and exhaustive. The revised policy was introduced in June 2002 and lays down detailed criteria for procurement of necessary items by the Commission.

The Commission places great emphasis on providing better health care facilities to its employees and their dependents. In this regard, hospitalization coverage was extended during the year to include dependent parents of employees. In addition, health care facilities have now been provided for continued treatment of illnesses after discharge from hospital and for prolonged illnesses that do not require hospitalization.

The Commission has established a provident fund, a gratuity fund and a pension scheme forthe benefit of its employees according to their terms of service. During financial year 2002, following trusts were set up for administration of these funds:

(i) SEC Employees Provident Fund Trust;

(ii) SEC Employees Gratuity Fund Trust; and (iii) SEC Employees Pension Fund Trust.

The Trusts have been duly registered with the Joint Sub-Registrar, Islamabad. In addition, the Provident Fund Trust has been given recognition by the Commissioner of Income Tax/Wealth Tax, Islamabad for the purpose of tax exemption. Recognition of Gratuity Fund Trust and Pension Fund Trust by tax authorities is in process. The funds of the Provident Fund Trust have been invested in Pakistan Investment Bonds for five years in compliance with the requirements of the Trust Act, 1882.

Table 29 below shows the total number of employees, as of June 30, 2002, who will benefit from the establishment of Trusts by the Commission.

TABLE 29 Number of Employees with Retirement Benefits

The financial statements of Provident Fund Trust and Gratuity Fund Trust, for the year ended June 30, 2001, were finalized during the year under review. These financial statements were audited by Taseer Hadi Khalid and Co., Chartered Accountants as required under Rule 47 of Provident Fund Trust Deed.

The Finance and Accounts Wing is responsible for treasury functions within the Commission as well as preparation and maintenance of its books of account and related records. In discharging these functions, the Wing is required to comply with the policies and procedures established by the Commission.

The Finance and Accounts Wing is responsible for preparation of periodic financial statements of the Commission on the basis of underlying records and books of account. An effective accounting system has been established for the purpose, which involves use of a multi-user accounting software. A system of internal control has also been developed and effectively implemented. As a result, there is adequate segregation of duties coupled with effective checks and controls, appropriate approval and authorization and consistent application of properly documented policies and procedures.

The audited financial statements of the Commission for the financial year 2001 were submitted to the Federal Government within the stipulated time frame. These financial statements were audited by Taseer Hadi Khalid and Co., Chartered Accountants. The financial statements for the financial year 2002 will be furnished to the Federal Government after the conclusion of statutory audit, which is in progress.

During the year under review, the Finance and Accounts Wing prepared the budget for the year 2002-03, keeping in view the expected revenues and expenses of the Commission for the following year. The budget has been approved by the Commission and the Policy Board under Section 24 of the Act.

During the year, the Finance and Accounts Wing commenced preparation of monthly reports under the Management Information System (MIS). The following reports are included in the MIS:

(i) Balance Sheet;

(ii) Income and Expenditure Account;

(iii) Cash flow Statement;

(iv) Capital Budget Variance Report;

(v) Revenue Budget Variance Report; and (vi) Division-wise Income and Expenditure Statement.

The MIS reports are placed before the Commission on a monthly basis. These reports provide useful information about the revenue generated and expenditure incurred at each Division in the Headquarters as well as at each CRO. In addition, a consolidated position of assets, liabilities, revenues and expenses of the Commission for each month is determined and a comparative analysis of actual results with the budget is carried out. The introduction of monthly MIS reports has strengthened and improved the ability of the Commission to evaluate its financial performance on a regular basis.