Statute

   
APPROVED
by Order No. 1K-190
by the Finance Minister of the Republic of Lithuania 
from 20 June 2005  


BY-LAWS OF STATE UNDERTAKING “DEPOSIT AND INVESTMENT INSURANCE”

I. GENERAL PROVISIONS

1. State undertaking “Deposit and Investment Insurance” (hereinafter referred to as “insurance undertaking”) shall be a state undertaking established under the Law of the Republic of Lithuania on the Insurance of Deposits of Individuals by the Government of the Republic and from state-owned assets, and registered pursuant to the procedure laid down in legal acts; the said undertaking shall have its own seal with the state emblem of Lithuania and the name “’State undertaking “Deposit and Investment Insurance’”. The institution implementing the rights and duties of its owner shall be the Ministry of Finance.
2. The insurance undertaking shall be a limited civil liability public legal entity that has its independent balance and accounts with the Bank of Lithuania, banks established in accordance with the laws and branches of foreign banks established in the Republic of Lithuania, and also assets which the undertaking manages, used and disposes of by right of asset trust, and administered assets which the undertaking disposes of in compliance with the procedure set by the laws and these By-laws. The assets handed over to the insurance undertaking by the state, and also the assets acquired by the insurance undertaking belong to the state by proprietary right. In terms of its obligations the insurance undertaking shall be liable by the assets of the insurance undertaking only, in respect of which recovery can be applied. The insurance undertaking shall not be liable in terms of obligations assumed by the state.
3. In its activities the insurance undertaking shall be guided by the Law of the Republic of Lithuania on Insurance of Deposits and Liabilities to Investors, the Law of the Republic of Lithuania on the State and Municipal Undertakings, and other legal acts, unless the Law of the Republic of Lithuania on Insurance of Deposits and Liabilities to Investors provides otherwise, and by these By-laws.
4. The By-laws of the insurance undertaking and amendments of the By-laws shall be approved by the Ministry of Finance. Amendments of the By-laws shall come into effect from the date of their registration with the Register of Legal Entities in accordance with the procedure set by the laws.
5. The financial year of the insurance undertaking shall commence on 1 January and end on 31 December.
6. The operations duration of the insurance undertaking shall not be limited.
7. The domicile of the insurance undertaking is located in Vilnius at the following address: 31, Algirdo Street, 03219 Vilnius.

II. AIMS AND FUNCTIONS OF THE ACTIVITIES OF THE INSURANCE UNDERTAKING

8. The aims of the activities of the insurance undertaking shall be: to insure deposits and liabilities to investors as determined by the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors in compliance with the procedure set by the said law; to administer the Deposits Insurance Fund and the Liabilities to Investors Insurance Fund (hereinafter referred to as “administered funds”), and carry out other operations stipulated by the said law and these By-laws as required for the performance of the functions of the insurance undertaking.
9. In the course of implementation of the aims of its activities, the insurance undertaking shall perform the following functions:
9.1. accumulate monies in the administered funds pursuant to the procedure set by the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors and these By-laws;
9.2. calculate and pay compensations to the depositors and investors of banks, branches of foreign banks established in the Republic of Lithuania (hereinafter referred to as “branches”), the Central Credit Union and credit unions (hereinafter “credit unions”), brokers undertakings, investments funds or management undertakings of investment companies of variable capital (hereinafter “undertakings”), also of branches of foreign brokers undertakings and management undertakings (hereinafter “undertaking subsidiaries”) (hereinafter “insured”, which make insurance payments in accordance with the procedure set by the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors;
9.3. supervise compliance of the insured with the procedure of insurance laid down in the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors;
9.4. evaluate the risk of the insurance undertaking;
9.5. invest administered funds and own assets of the insurance undertaking into securities of the governments and central banks of the states set by the council of the insurance undertaking;
9.6. assess the terms and conditions of insurance (compensation) of deposits or liabilities to investors or any other protection provided by foreign states the banks or undertakings whereof are setting branches in the Republic of Lithuania;
9.7. perform other functions specified in the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors related to the implementation of the said law and ensuring the activities of the insurance undertaking.

III. RIGHTS OF THE INSURANCE UNDERTAKING

10. In the course of the performance of its functions, the insurance undertaking shall have the following rights:
10.1. to have accounts with the Bank of Lithuania, commercial banks and branches;
10.2. to conclude agreements and assume liabilities;
10.3. to manage and use the property it administers and the assets of the insurance undertaking, and also to dispose of such property in the manner prescribed by laws and these By-laws;
10.4. to terminate deposit insurance and insurance of liabilities to investors in the cases specified in Article 14 of the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors;
10.5. to supervise whether insurance compensations by the insured are calculated and paid correctly, and whether the insured do not violate the procedure for the insurance of deposits and liabilities to investors set by the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors;
10.6. to obtain from the insured the information necessary for the performance of the functions of the insurance undertaking;
10.7. to obtain from the supervisory authorities of the insured the following information: the measures applied to the insured; the issue and withdrawal of authorization for commercial banks, credit unions and branches to accept deposits; the rights granted to commercial banks, undertakings, credit unions and branches;
10.8. to obtain all and any information necessary for calculation and payment of insurance compensations from the insured involved in an insured event;
10.9. to verify the data obtained from the insured involved in an insured event;
10.10. to receive part of the assets of the commercial bank, undertaking or the credit union in liquidation which provided insurance coverage for the deposits of its depositors and its liabilities to the investors pursuant to the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors;
10.11. to recover from the insured outstanding insurance contributions and late payment interest in accordance with the procedure set by the laws;
10.12. to take a decision to withdraw bank shares from bank shareholders for public needs in cases and in accordance with the procedure set by the laws, and also manage by right of trust, use and dispose of the withdrawn shares in accordance with the procedure set by legal acts;
10.13. if and when a decision is taken to withdraw bank shares from bank shareholders for public needs, to obtain the list of the owners of bank shares from the Central Depository;
10.14. to take loans in order to meet the liabilities of the insurance undertaking;
10.15. to enter into property valuation agreements with persons having a right to engage in securities valuation;
10.16. to settle payments for commodities supplied, works performed and services rendered in any agreed form, unless this contravenes with the laws.

IV. MANAGEMENT OF THE INSURANCE UNDERTAKING

11. The management bodies of the insurance undertaking shall be the institution implementing the rights and duties of the owner of the insurance undertaking, i.e. the Ministry of Finance, the council of the insurance undertaking and the single-person managing body, the manager of the insurance undertaking.
12. The council of the insurance undertaking shall comprise 6 members appointed by the Government of the Republic of Lithuania. The Ministry of Finance shall nominate 3 candidates, the Bank of Lithuania – 2 candidates, and the Securities Commission – 1 candidate. With the approval of the council, one representative from each of the following – the association of banks, the brokers’ association and the association of credit unions may take part in the meetings of the council with a deliberative vote. Members of the council of the insurance undertaking shall be remunerated for their work by the institutions which have delegated them.
13. The term of office of members of the council of the insurance undertaking shall be 4 years and the number of terms shall not be limited. The institutions which have nominated its candidate to the members of the council of the insurance undertaking may recall him/her and nominate another candidate to fill the vacancy.
14. The activities if the council of the insurance undertaking shall be directed by chairman of the council and when he is not available – by deputy chairman of the council. Chairman and deputy chairman of the council shall be elected by the council of the insurance undertaking from among its members.
15. The council of the insurance undertaking shall:
15.1. submit conclusions, comments and proposals to the Ministry of Finance concerning the business strategy and management structure of the insurance undertaking;
15.2. submit proposals to the Ministry of Finance concerning amendments of the By-laws of the insurance undertaking;
15.3. establish the procedure of calculation and payment of insurance contributions and its time limits, and publish the said procedure in “Valstybės žinios” (“Official Gazette”);
15.4. establish the rate of default interest for late payment of insurance contributions, the procedure of calculation and calculation of default interest, and also publish the said procedure in “Valstybės žinios” (“Official Gazette”);
15.5. establish the procedure of calculation and payment of insurance compensations, and publish the said procedure in “Valstybės žinios” (“Official Gazette”);
15.6. establish the procedure of investment of the resources of the funds administered by the insurance undertaking and determine the countries into whose government and central bank securities investments may be made;
15.7. make decisions on the amendment of the insurance payment rate, and publish the said decisions in “Valstybės žinios” (“Official Gazette”);
15.8. extends the time limit of the payment of insurance compensations pursuant to the procedure laid down in Article 10(1) of the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors;
15.9. make decisions on the termination of deposit insurance or insurance of liabilities to investors in cases and in conformity with the procedure laid down in Article 14 of the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors;
15.10. establish procedure for supplementary insurance coverage for deposits or liabilities to investors, and publish the said procedure in “Valstybės žinios” (“Official Gazette”);
15.11. in cases and in conformity with the procedure stipulated by the laws, and upon approval by the Ministry of Finance, make a decision to withdraw bank shares from bank shareholders for public needs, and also make a decision concerning payment for such shares, and set the amount of funds allotted to restoration of the security and reliability of the activities of the bank;
15.12. establish its own working regulations;
15.13. submit to the Ministry of Finance the annual report about its activities within 4 months of the completion of the financial year;
15.14. make decisions on the loans taken for the purpose of execution of obligations of the insurance undertaking, and the amounts of such loans;
15.15. perform other functions provided for in these By-laws and the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors.
16. The Ministry of Finance shall: 
16.1. establish the business strategy of the insurance undertaking;
16.2. establish the structure of the insurance undertaking;
16.3. approve the By-laws of the insurance undertaking;
16.4. appoint and recall the manager of the insurance undertaking, establish the terms and conditions of the employment contract entered into with the manager of the insurance undertaking and terminate the employment contract entered into with the manager of the insurance undertaking, and approve the working regulations of the manager of the insurance undertaking;
16.5. approve the annual financial statements and distribution of profit (loss) of the insurance undertaking;
16.6. approve the earnings and expenses estimates of the insurance undertaking;
16.7. select an audit undertaking and enter into agreement on audit services with the said undertaking;
16.8. define a commercial secret of the insurance undertaking;
  16.9. make a decision on restructuring of the insurance undertaking by taking into account the exceptions laid down in legal acts;
  16.10. make decisions on liquidation or restructuring of the insurance undertaking and cancellation of the liquidation of the insurance undertaking;
  16.11. appoint and discharge the liquidator of the insurance undertaking;
 16.12. submit its conclusions to the council of the insurance undertaking concerning withdrawal of bank shares from bank shareholders for public needs;
 16. 13. approve annual property acquisition and borrowing plans of the insurance undertaking;
 16.14. approve the calculation methods and rates of long-term asset depreciation established by the insurance undertaking;
 16.15. resolves other matters referred to its competence by the Law of the Republic of Lithuanian on the Insurance of Deposits and Liabilities to Investors, the Law of the Republic of Lithuania on the State and Municipal Undertakings, other legal acts and these By-laws. 
 17. Decisions made by the Ministry of Finance shall be executed in writing. 
 18. The manager of the undertaking shall manage the activities of the insurance undertaking and act for and on behalf of the undertaking in relations with other entities.
19. The manager of the insurance undertaking shall commence execution of his/her functions from the date of his/her appointment to the position.
20. The manager of the insurance undertaking shall be accountable to the Ministry of Finance.
21. No person who is deprived of the right to take the position pursuant to the laws shall be appointed manager of the insurance undertaking. The manager of the insurance undertaking shall not be entitled to take the position of the chief accountant (accountant) of the undertaking or the manager of the accounting service that is in charge of the accounting of the undertaking.
22. The manager of the insurance undertaking shall also not be entitled to acts as or become a member of the managing body of another legal entity, the chief accountant (accountant) or the manager of the accounting service in charge of the accounting of such a legal entity. If and when a person who is a member of the managing body of another legal entity, the chief accountant (accountant) or manager of the accounting service in charge of the accounting of such a legal entity, the said person shall resign from his/her position with the other legal entity in pursuance of the procedure laid down in the laws.
23. Employment contracts with the manager of the undertaking shall be signed, for and on behalf of the insurance undertaking, by the Finance Minister or his authorized person.
24. The deputy manager of the insurance undertaking shall be appointed to the position or discharged from the position by the manager of the undertaking subject to approval by the Ministry of Finance. The salary of the deputy manager of the insurance undertaking shall be established and approved by the manager of the undertaking.
25. The manager of the insurance undertaking shall:
25.1. employ and discharge employees, and enter into/terminate employment contracts with them;
25.2. approve working regulations of the employees of the insurance undertaking, and issue orders governing the work of the employees of the insurance undertaking within the limits of his/her competence;
25.3. establish regulations for work payments and bonus payments to the employees of the insurance undertakings; establish the amount of their salaries; impose penalties and provide incentives. Service salaries, extras to the salaries, additional payments, bonuses, subsidies and other payments to the employees of the insurance undertaking shall be paid from the funds allotted to the maintenance expenses of the employees of the insurance undertaking, the amount whereof shall be approved by the Ministry of Finance in the estimates of the administration-related expenses of the insurance undertaking;
25.4. enter into transactions for and on behalf of the insurance undertaking. Any transactions to the amount of more than 1,000,000 Litas shall be subject to approval by the Ministry of Finance. No such approval shall be required for decisions made by the manager of the insurance undertaking regarding investment of resources of the administered funds and own assets of the insurance undertaking made in compliance with the procedure for investment of administered funds and own assets of the insurance undertaking established by the council of the insurance undertaking;
25.5. upon obtaining approval by the Ministry of Finance, set the methods and rates for calculating asset depreciation in the undertaking; 
25.6. represent the insurance undertaking at government and management authorities, in courts and in relations with other entities;
25.7. dispose of the administered funds and own assets of the insurance undertaking pursuant to the procedure established by the laws;
25.8. make decisions regarding investment of the administered funds and own capital of the insurance undertaking in compliance with the procedure for investment of administered funds and own capitals of the insurance undertaking established by the council of the insurance undertaking, and select financial brokers for making the investments;
25.9. submit a risk assessment report of the insurance undertaking to the council of the insurance undertaking;
25.10. make arrangements for announcement of the decisions of the council of the insurance undertaking that must be published pursuant to the Law of the Republic of Lithuania on the Insurance of Deposits and Liabilities to Investors;
25.11. submit information to the Ministry of Finance regarding forecasts and plans of the activities of the undertaking by stating the amounts of investments required in the next financial year, and also regarding occurrences that are of crucial importance to the activities of the undertaking;
25.12. make arrangements for seminars and training sessions, provide information on the system of the insurance of deposits and liabilities to investors existing in Lithuania;
25.13. prepare and submit to the council of the insurance undertaking materials and draft documents, which are necessary for the performance of the functions of the council;
25.14. supply information to the Ministry of Finance, which is necessary for the performance of its functions;
25.15. within 5 months of the completion of the financial year, publish the annual financial statements of the insurance undertaking;
25.16. at the demand of the Ministry of Finance, supply the Ministry with intermediate financial statements of the undertaking;
25.17. prepare and submit to the Ministry of Finance, along with the annual financial statements of the undertaking, draft resolution on distribution of the profit (loss) of the undertaking subject to distribution and the activity report covering the accounting financial year for the Ministry’s approval; 
25.18. perform any other actions aimed at ensuring the activities of the insurance undertaking.
26. The manager of the insurance undertaking shall be responsible for:
26.1. management of the activities of the insurance undertaking;
26.2. reporting occurrences that are of crucial importance to the activities of the insurance undertaking to the Ministry of Finance;
26.3. drawing up the annual financial statements of the insurance undertaking and submitting same, along with the auditor’s conclusion and the audit report, to the Ministry of Finance within 3 months of the completion of the financial year;
26.4. submitting the activity report of the insurance undertaking to the Ministry of Finance;
26.5. submitting data and documents of the insurance undertaking to the Register of Legal Entities;
26.6. announcing public information;
26.7. keeping documents and other information concerning the insurance undertaking and its administered funds;
26.8. management, use and disposal of the assets of the insurance undertaking in compliance with the terms and conditions laid down in these By-laws;
26.9. other actions referred to the competence of the manager of the insurance undertaking according to the Law of the Republic of Lithuania on the State and Municipal Undertakings, the Law on the Insurance of Deposits and Liabilities to Investors, and these By-laws. 
27. The manager and other employees of the insurance undertaking shall compensate losses caused to the insurance undertaking through their fault pursuant to the procedure established by legal acts.

V. PROCEDURE FOR AND TERMS AND CONDITIONS OF MANAGEMENT, USE AND DISPOSAL OF ASSETS HANDED OVER TO THE INSURANCE UNDERTAKING BY RIGHT OF TRUST

 28. Any assets handed over to the insurance undertaking by right of trust by the owner of the insurance undertaking, and also any assets acquired by the insurance undertaking shall be property of the owner of the insurance undertaking.
 29. The right of trust in respect of the assets of the owner of the insurance undertaking shall set in for the insurance undertaking from the date of hand-over of the assets to the insurance undertaking and signing of the statement of transfer and acceptance.
 30. Assets of any type of the owner of the insurance undertaking can be handed over to the insurance undertaking, which may be handed over to the insurance undertaking for management, use and disposal of in pursuance of the Law of the Republic of Lithuania on the Management, Use and Disposal of State and Municipal Property. Such assets shall be handed over in compliance with the procedure laid down in legal acts: the balance value of the assets shall be stated in the statement of asset transfer.
 31. The insurance undertaking shall insure any long-term tangible assets handed over to the undertaking for management, use and disposal of by right of trust in pursuance of the procedure laid down in the laws with an insurance undertaking registered in the Republic of Lithuania.
 32. The insurance undertaking shall have a right to make decisions related to management, use and disposal of the assets handed over to the undertaking, save for decisions related to transfer of the assets into possession by other persons, or encumbrance of proprietary rights, unless laws stipulate otherwise.

VI. CONFIDENTIALITY OF THE COMMERCIAL SECRETS OF THE INSURANCE UNDERTAKING

33. The information which is a commercial secret of the insurance undertaking may be supplied only to the institutions specified in laws and in the manner prescribed by the law.
34. The members of the council and the employees of the insurance undertaking shall be liable for disclosure of the information with is a commercial secret of the insurance undertaking in the manner prescribed by the law.

VII. PROCEDURE FOR MAKING ANNOUNCEMENTS AND GIVING NOTICES

35. Announcements and notices of the insurance undertaking to its employees shall be communicated during meetings and sessions. At the decision of the manager of the insurance undertaking, the main announcements and documents shall be communicated to the employees against signature. 
36. The legal normative acts adopted by the council of the insurance undertaking as specified in Clauses 15.3, 15.4, 15.5, 15.7 and 15.10 of these By-laws shall be published in “Valstybės žinios” (“Official Gazette”), whereas the resolutions specified in Clause 15.9 of these By-laws shall be published in the annex “Informaciniai pranešimai “ (“Information Notices”) to “Valstybės žinios” (“Official Gazette”). Other announcements and notices of the insurance undertaking that must be published in the press pursuant to the legal acts shall be published in the daily newspaper “Respublika”. 

VIII. OWN CAPITAL OF THE INSURANCE UNDERTAKING

37. The own capital of the insurance undertaking shall consist of the capital of the owner of the insurance undertaking, the statutory reserve, the revaluation reserve and the non-distributed profit (loss) of the current year. 
38. The capital of the owner of the insurance undertaking shall amount to 30,974,825 Litas.
39. The capital of the owner of the insurance undertaking may be used for payment of insurance compensations in that case only, when the administered funds and the statutory reserve are short of monies for the purpose. 
40. The part of the capital of the owner of the insurance undertaking, which was used as specified in Clause 39 of these By-laws, shall be restored to the amount available before the capital was used for payment of insurance compensations from the resources of the administered funds. The amounts of the resources of the administered funds used for restoration of the capital of the owner of the insurance undertaking shall equal the amounts by which the capital of the owner has been reduced for the purpose of payment of insurance compensations of each of these funds. 

IX. EARNINGS AND EXPENSES OF THE INSURANCE UNDERTAKING

41. The earnings of the insurance undertaking shall be made up of:
41.1. remuneration for the administration of the administered funds;
41.2. earnings from the investment of the own capital of the insurance undertaking;
41.3. other earnings.
42. The expenses of the insurance undertaking shall be made up of:
42.1. expenses of the administration of the administered funds;
42.2. expenses of the investment of the own capital of the insurance undertaking;
42.3. other expenses.

X. DISTRIBUTION OF PROFIT AND THE STATUTORY RESERVE OF THE INSURANCE UNDERTAKING

43. The result of a financial year of the insurance undertaking shall be the profit (loss) of the insurance undertaking.
44. The profit of the insurance undertaking shall be distributed not later than within 4 months of the completion of the financial year.
45. The total profit of the insurance undertaking shall be distributed into the statutory reserve.
46. The statutory reserve of the insurance undertaking may be used for:
46.1. payment of insurance compensations, when the administered fund from which insurance compensations are paid are short of monies;
46.2. restoration of the capital of the owner to the amount available before the capital was used for payment of insurance compensations;
46.3. covering losses of the business operations of the insurance undertaking.
47. Any non-distributed loss shall be brought forward to the next financial year.
48. The provisions of the Law of the Republic of Lithuania on the State and Municipal Undertakings shall not apply to the formation, amount and use of the statutory reserve of the insurance undertaking.

XI. SEVERALTY OF THE ADMINISTERED FUNDS

49. Insurance contributions of banks, branches and credit unions, insurance compensations and earnings from the investments of the Deposits Insurance Funds, and also any funds recovered from the insured in liquidation, which have paid insurance contributions into the Deposits Insurance Fund, and other earnings and expenses of the Deposits Insurance funds shall be counted up and accumulated separately from undertaking insurance contributions, insurance compensations and earnings from the investments of the Liabilities to Investors Insurance Fund, and also from funds recovered from the insured in liquidation, which have paid insurance contributions into the Liabilities to Investors Insurance Fund, and other earnings of the Liabilities to Investors Insurance Fund.
50. Insurance compensations for deposits and liabilities of banks and branches to investors shall be paid from the Deposits Insurance Fund, whereas for liabilities of undertakings to investors – from the Liabilities to Investors Insurance Fund.
51. If and when a fund is short of monies for payment of insurance compensations, whereas such monies are available in the other fund, insurance compensations may be paid from the said other fund; however, the resources of the statutory reserve shall be used first. Thereafter, the insurance contributions paid into the fund which was short of monies for payment of insurance compensations shall be, first of all, used for return of monies into the said other fund.




XII. EARNINGS AND EXPENSES OF THE ADMINISTERED FUNDS

52. The earnings of the administered funds shall be made up of insurance contributions, amounts recovered from an insured in liquidation pursuant to the laws, earnings from the investments of the administered funds, funds received from sale of the shares and property of a bank the shares whereof are withdrawn from the shareholders from public needs, and also other amounts.
53. The expenses of the administered funds shall be make up of insurance compensations and expenses of administration of the administered funds, amounts taken for payment for bank shares withdrawn from the bank shareholder for public needs, and also amounts allotted to restoration of security and reliability of the bank the shares whereof have been withdrawn from the shareholders for public needs.
54. The amount of the expenses of administration of the administered funds shall be established by taking into account the estimated administration expenses of each of the funds and the amounts of the funds by the council of the insurance undertaking when approving the estimates of the administration expenses of the insurance undertaking.


XIII. INVESTMENT OF THE CAPITAL OF THE INSURANCE UNDERTAKING AND THE ADMINISTERED FUNDS

55. The funds of the capital of the insurance undertaking and the administered funds may be invested in accordance with the procedure established by the council of the insurance undertaking into securities of the governments and central banks of the countries set by the council of the insurance undertaking. 
56. The earnings received from the investment of the funds of the capital of the investment undertaking and the administered funds shall be distributed to the earnings of the insurance undertaking and the earnings of the administered funds in proportion to the amounts of the capital of the insurance undertaking, the Deposits Insurance Fund and the Liabilities to Investors Insurance Fund.


XIV. EXEMPTION OF THE INSURANCE UNDERTAKING FROM PAYMENT OF THE PROFIT TAX AND THE INTEREST ON THE USE OF THE CAPITAL OF THE OWNER OF THE STATE UNDERTAKING

57. The insurance undertaking shall be exempted from payment of the profit tax pursuant to the procedure established by the laws. 
58. The insurance undertaking shall be exempted from payment of interest on the use of the capital of the owner of the state undertaking into the state budget.


XV. CONTROL OF THE FINANCIAL ACTIVITIES OF THE INSURANCE UNDERTAKING

59. The financial statements of the insurance undertaking shall be compiled in compliance with the procedure established by the legal acts that govern accounting and financial accountability. The annual financial statements of the insurance undertaking shall be verified by an audit undertaking. The audit of the annual financial statements shall be mandatory, whereas the audit of the financial statement of other periods may be carried out at the initiative of the Ministry of Finance, the council or the administration of the insurance undertaking. The annual financial statements of the insurance undertaking shall be verified by an audit undertaking and published in the daily newspaper specified in Clause 36 of these By-laws not later than within 5 months of the completion of the financial year.
60. The audit shall be carried out by an undertaking established in accordance with the set procedure and entered into the list of audit undertakings of the Republic of Lithuania.
61. The Ministry of Finance shall select an audit undertaking pursuant to the procedure established by the Law on Public Procurements, and enter into an audit service agreement with the auditors. The audit services shall be paid from the funds of the insurance undertaking.
62. The annual financial statements of the insurance undertaking approved by the Ministry of Finance shall be submitted along with the auditor’s conclusion and the audit report to the Register of Legal Entities within 30 days of the approval of the said statements. 
63. Intermediate financial statements of the insurance undertaking shall be compiled within 30 days of the completion of a financial quarter of the year of the insurance undertaking. At the demand of the Ministry of Finance, the manager of the insurance undertaking shall submit intermediate financial statements of the insurance undertaking to the Ministry of Finance.
64. The state audit of the activities of the insurance undertaking shall be carried out in cases and in accordance with the procedure established by the laws.
65. The internal audit of the insurance undertaking shall be carried out in pursuance of the legal acts that govern internal audit.
66. The manager of the insurance undertaking shall be obliged to submit documents of the insurance undertaking as requested by the auditor, the state control authorities and the Ministry of Finance inasmuch as this does not contravenes with the provisions of Clause 33 of these By-laws.

XVI. LIQUIDATION AND RESTRUCTURING OF THE INSURANCE UNDERTAKING

67. The insurance undertaking shall be liquidated or restructured in accordance with the procedure laid down in the laws.

XVII. PROCEDURE FOR AMENDMENT OF THE BY-LAWS OF THE INSURANCE UNDERTAKING

68. The right of initiative to amend or supplement these By-laws shall be vested in the Ministry of Finance, the council of the insurance undertaking and the manager of the insurance undertaking. Amended or supplemented By-laws shall be approved by the Ministry of Finance. Amended By-laws shall come into effect from the date of their registration with the Register of Legal Entities.  


Finance Minister Zigmantas Balčytis
 
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