## THE FUND'S INCOME POSITION FOR FY 2021—ACTUAL OUTCOME

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**Canonical URL:** [THE FUND'S INCOME POSITION FOR FY 2021—ACTUAL OUTCOME](https://www.imf.org/-/media/files/publications/pp/2021/english/ppea2021069.pdf)

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### Executive summary
- Overall FY 2021 net income amounted to SDR 4,812 million, SDR 734 million higher than the April projection.
- The increase mainly reflected:
  - A larger-than-anticipated remeasurement gain reported under IAS 19 of SDR 658 million.
  - Endowment Subaccount (EA) returns exceeding earlier projections by SDR 177 million.
- The GRA net income of about SDR 4 billion increases the Fund’s reserves.
- In accordance with April 2021 decisions, a net transfer of currencies from the GRA to the Investment Account amounting to SDR 2,393 million is scheduled to be made in the second quarter of FY 2022.
- Precautionary balances reached SDR 20.0 billion at end-FY 2021.

### Review of the income position for FY 2021 — key findings
- Total FY 2021 net income and deviations from April projections:
  - Net income position (Actual Outcome): SDR 4,812 million.
  - April Projections: SDR 4,078 million.
  - Difference: SDR 734 million.
- Major contributors to the difference:
  - IAS 19 remeasurement gains: Actual SDR 3,155 million vs. April SDR 2,497 million (difference SDR 658 million).
  - Endowment Subaccount investment income: Actual SDR 783 million vs. April SDR 606 million (difference SDR 177 million).
  - Net operational income (before IAS 19): Actual SDR 874 million vs. April SDR 975 million (difference -SDR 101 million).
- Lending and investment income:
  - Lending income: SDR 1,983 million (SDR 9 million below April estimate of SDR 1,992 million).
    - Margin for the rate of charge: SDR 867 million.
    - Service and other charges: SDR 115 million.
    - Commitment fees: SDR 70 million.
    - Surcharges: SDR 931 million.
  - Investment income (Fixed-Income Subaccount): SDR 86 million (SDR 16 million below April projection of SDR 102 million), reflecting mainly the increase in U.S. Treasury bond yields during March.
  - Endowment Subaccount (EA) returns: SDR 783 million (SDR 177 million higher than April estimate), boosted by equity market outperformance in March and April.
- Expenses:
  - Total expenses: SDR 1,203 million (SDR 76 million higher than April projection of SDR 1,127 million).
  - Net administrative expenditures: SDR 796 million (SDR 12 million lower than April projection of SDR 808 million).
  - Capital budget items expensed: SDR 7 million (SDR 1 million lower than April projection of SDR 8 million).
  - Depreciation: SDR 48 million (SDR 1 million lower than April projection of SDR 49 million).
  - Net periodic pension cost after funding (IAS 19): SDR 352 million (SDR 90 million higher than April projection of SDR 262 million). The SDR 90 million difference reflects mainly the delay in implementation of certain plan amendments under the Comprehensive Compensation and Benefits Review (CCBR) and the expected benefit not being recognized in FY 2021 as earlier anticipated.

### IAS 19 remeasurement and pension-related items
- IAS 19 remeasurement (actuarial) gains total:
  - Actual: SDR 3,155 million.
  - April projection: SDR 2,497 million.
  - Difference: SDR 658 million.
- Drivers of IAS 19 remeasurement gains:
  - Excess return on plan assets: contributed SDR 2,532 million (Actual) vs. SDR 2,002 million (April projection).
  - Discount rate change contribution: SDR 617 million (Actual) vs. SDR 450 million (April projection); discount rate at end of year: 3.02 percent (April projection 2.92 percent).
  - Other items: net of about SDR 6 million (Actual) vs. SDR 45 million (April projection).
- Net periodic pension cost and funding:
  - Net periodic pension cost: SDR 352 million (Actual) vs. SDR 262 million (April projection).
  - Pension cost accrual: SDR 504 million (Actual) vs. SDR 419 million (April projection).
  - Pension funding: SDR 152 million (Actual) vs. SDR 157 million (April projection).
- Net administrative expenses reconciliation (audited financial statements):
  - Total administrative expenses per audited financial statements: USD 1,696 million (equivalent to SDR 1,199 million using the weighted average FY 2021 U.S. dollar/SDR exchange rate of 1.41 (rounded)).
  - Components include reimbursement from SDR Department and net periodic pension cost after funding timing difference.

### Precautionary balances and transfers between accounts
- Precautionary balances:
  - End of period (Actual): SDR 20.0 billion.
  - April projection: SDR 19.5 billion.
  - The unrealized pension-related accounting adjustment exceeded projections by about SDR 658 million, offset partly by net operational income being lower than earlier estimates by about SDR 101 million.
  - Subsequent to April 30, 2021, the remaining balance in the SCA-1 of SDR 1,066 million was distributed in connection with Sudan’s arrears clearance, reducing precautionary balances by the same amount.
- Allocation and transfers of FY 2021 net income:
  - Income from the Endowment Subaccount (EA): SDR 783 million is retained in the EA.
  - Income from the Fixed-Income Subaccount: SDR 86 million is transferred to the GRA to meet administrative expenses.
  - Portion of FY 2021 GRA net income of SDR 4,029 million was used to:
    - Replenish the FY 2020 net loss of about SDR 1,550 million charged to the special reserve.
    - The remainder allocated equally between the Fund’s general reserve and special reserve.
  - Transfers of currencies:
    - FY 2021 GRA reserves at April 30, 2021: SDR 23,350 million.
    - Less GRA reserves at April 30, 2019: SDR -20,871 million.
    - Increase (to be transferred): SDR 2,479 million, composed of:
      - FY 2021 GRA net income: SDR 4,029 million.
      - Less FY 2020 GRA net loss: SDR -1,550 million.
    - Less: Transfer of Fixed-Income Subaccount income to GRA: SDR -86 million.
    - Net transfer from GRA to Fixed-Income Subaccount: SDR 2,393 million (scheduled in second quarter of FY 2022).
  - Net of the above, a net transfer of currencies from the GRA to the Investment Account amounting to SDR 2,393 million will be made in the second quarter of FY 2022.

### Key statistics and memorandum items (exact figures)
- Fund credit (average stock, SDR billions): 86.7 (Actual) vs. 86.8 (April projection).
- SDR interest rate (average, in percent): 0.1 (Actual) vs. 0.1 (April projection).
- US$/SDR exchange rate (average): 1.41 (Actual) vs. 1.42 (April projection).
- Precautionary balances (end of period, SDR billions): 20.0 (Actual) vs. 19.5 (April projection).

*Prepared by the Finance Department; approved by Bernard Lauwers (FIN).*

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_Source: https://www.imf.org/-/media/files/publications/pp/2021/english/ppea2021069.pdf_