| Mon 30 Jun 2008, 17:14 | | ZRNHDG - Zshares Randhedge - Unaudited Results For The Year Ended 31 March 2008 |
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JSE ZRNHDG
ZRNETF
ZRNHDG - Zshares Randhedge - Unaudited Results For The Year Ended 31 March 2008
ZSHARES RANDHEDGE
Abbreviated name: "ZRNDHDG"
JSE Share code: ZRNHDG
ISIN: ZAE000109120
Unaudited results for the year ended 31 March 2008
Zshares RandHedge Tracker Fund
Income statement for the period 28 November 2007 to
31 March 2008
2008
Note R
Net investment income 7,781,219
Dividends - local 502,742
Interest - local 118,754
Interest - 4,208
foreign
Realised gains on disposal 522,877
of investments
Unrealised gains on 6 6,632,638
revaluation of investments
Operating expenses before 512,332
finance costs
Audit fees 15,069
Service fees 165,841
Transaction costs 317,240
Trustee fees 14,182
Net income for the period before 7,268,887
finance costs
Finance costs 431,871
8 431,871
Distributions
Increase in net assets 6,837,016
attributable to unitholders
Balance sheet as at 31 March
2008
Assets
Investments at market 60,841,097
value
Equities 60,841,097
Accounts 2,642,322
receivable
Cash and cash 293,166
equivalents
Total assets 63,776,585
Liabilities
Accounts payable 2,842,187
Total liabilities, excluding net 2,842,187
assets attributable to unitholders
Net assets attributable to 60,934,398
unitholders at end of period
Statement of changes in net assets attributable to
unitholders 31 March 2008
2008
Note R
Capital value of unit
portfolio
Net creation of 9 54,097,382
units
Transfer of net fair value
gains, net of transaction
costs,
not distributable 6,838,275
Balance at end of 60,935,657
period
Losses attributable to
unitholders
Increase in net assets 6,837,016
attributable to
unitholders
Transfer of net fair value
gains, net of transaction
costs,
not distributable (6,838,275)
Balance at end of (1,259)
period
Net assets attributable to 60,934,398
unitholders at end of period
Cash flow statement for the period 28 November 2007 to 31 March
2008
Net cash inflow from 313,237
operating activities
Net income for the 7,268,887
period before finance
costs
Adjusted
for:
Dividends (502,742)
Interest (122,962)
Realised gains on (522,877)
disposal of
investments
Unrealised gains (6,632,638)
on disposal of
investments
Operating loss before (512,332)
working capital
changes
Working
capital
changes
Increase in (2,642,322)
accounts
receivable
Increase in 2,842,187
accounts
payable
Cash utilised by (312,467)
operations
Dividends 502,742
received
Interest 122,962
received
Net cash outflow from
investing activities
Net acquisition of (53,685,582)
investments
Net cash inflow from 53,665,511
financing activities
Consideration 54,097,382
received on creation
of units
Cash distributions (431,871)
paid to
unitholders
Net cash increase 293,166
for the period
Cash and cash 293,166
equivalents at end of
period
Notes to the annual financial statements
For the year ended 31 March 2008
1. Accounting policies
1. Accounting policies
The Collective Investment Scheme ("the Scheme") is an open-ended investment
scheme incorporated under the Collective Investment Schemes Control Act of South
Africa.
The Scheme`s objectives are detailed as part of the Financial Risk Disclosure
below. The Scheme is mainly managed by Investec Fund Managers SA Limited.
1.1. Basis of compliance
Zshares RandHedge Tracker Fund
The financial statements have been prepared in accordance with the requirements
of the respective Trust Deeds and in accordance with International Financial
Reporting Standards issued by the International Accounting Standards Board
(IASB), and in the manner required by the Collective Investment Schemes Control
Act of South Africa.
1.2. Basis of preparation
The financial statements are presented in Rands, being the functional currency
of the Scheme. They are prepared on the historical cost convention as modified
by the revaluation of financial assets carried at fair value through profit or
loss. The accounting policies set out below have been applied consistently by
the Scheme to all periods presented. The unit portfolios within the Scheme
operate as individual entities whose participatory interests are marketed in
South Africa. The primary economic trading environment is deemed to be South
Africa. Each unit portfolio is organised and operated as one segment and
consequently no segmental reporting is provided in the Scheme`s financial
statements.
There are Standards and Interpretations in issue that are not yet effective.
These include the following Standard that is applicable to the business of
Investec Fund Managers SA Limited and may have an impact on disclosure in future
financial statements: IAS 1 Presentation of Financial Statements (Amendment),
effective for periods commencing on or after 1 January 2009, requires amendments
to the presentation of financial statements.
1.3 Foreign currency translation
Transactions in foreign currencies are translated at the foreign currency
exchange rate ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currency are translated
to Rand at the foreign currency closing exchange rate ruling at the balance
sheet date.
Non-monetary assets and liabilities denominated in foreign currency that are
measured at fair value are translated to Rand at the foreign currency exchange
rates ruling at the dates that the fair values were determined. Foreign currency
exchange differences relating to cash equivalents, investments at fair value
through profit or loss and derivative instruments are included in fair value
gains and losses on financial instruments.
All other foreign currency exchange differences relating to monetary items are
presented separately in the income statement.
1.4. Financial instruments
1.4.1. Classification
The Scheme designates all its investments upon initial recognition as financial
assets carried at fair value through profit or loss.
The categories of financial assets and liabilities at fair value through profit
and loss comprise:
- Financial assets classified as held for trading which are those that the
Scheme acquired or incurred principally for the purposes of selling or
repurchasing in the near term, or are part of a portfolio of identified
financial instruments that are managed together and for which there is
evidence of a recent actual pattern of short-term profit-taking.
- Derivative instruments are classified as financial assets at fair value
through profit or loss. Derivative instruments, including options and
futures, are used to hedge against market and currency movements in the
value of assets and liabilities. Hedge accounting is not applied.
- Financial instruments designated at fair value through profit and loss upon
initial recognition. These include financial assets that are not held for
trading purposes and which may be sold. These are investments in exchange-
traded debt and equity instruments, unlisted open-ended investment funds,
unlisted debt and equity instruments and commercial paper. The financial
instruments are managed and performance is evaluated on a fair value basis
in accordance with the Scheme`s investment mandate and are managed
accordingly by the nominated asset manager.
- Financial assets that are classified as loans and receivables include
balances due from brokers, accrued interest income, trade, and other
debtors. Financial liabilities that are not at fair value through profit
and loss include balances due to brokers, trade payables, accrued expenses
and financial liabilities arising on redeemable units.
1.4.2.Recognition and derecognition of financial instruments
Financial instruments are recognised on the balance sheet when, and only when,
the Scheme becomes a party to the contractual provisions of the particular
instrument.
The Scheme derecognises a financial asset when and only when:
- The contractual rights to the cash flows arising from the financial assets
have expired or been forfeited by the Scheme; or
- It transfers the financial asset including substantially all the risks and
rewards of ownership of the asset; or
- It transfers the financial asset, neither retaining nor transferring
substantially all the risks and rewards of ownership of the asset, but no
longer retains control of the assets.
A financial liability is derecognised when and only when the liability is
extinguished, that is, when the obligation specified in the contract is
discharged, cancelled or has expired.
The difference between the carrying amount of a financial liability (or
part thereof) extinguished or transferred to another party and
consideration paid, including any non-cash assets transferred or
liabilities assumed, is recognised in the income statement.
All purchases and sales of financial assets carried at fair value through
profit or loss that require delivery within the time frame established by
regulation or market convention ("regular way" purchases and sales) are
recognised at trade date, which is the date that the Scheme commits to
purchase or sell the asset. Otherwise such transactions are treated as
derivatives until settlement occurs.
1.4.3. Measurement
Financial instruments are measured initially at fair value. Transaction costs on
financial assets and financial liabilities at fair value through profit or loss
are expensed immediately, while on other financial instruments they are
amortised.
Subsequent to initial recognition, all instruments designated as at fair value
through profit or loss are measured at fair value with changes in their fair
value recognised in the income statement.
The Scheme uses the weighted average method to determine realised gains and
losses on derecognition.
Fair value gains and losses are taken to the income statement but are not
distributed to unitholders, except for the realised gains on instruments held by
the Money Market Funds. Fair value gains and losses that do not qualify for
distribution, together with the related transaction costs, are transferred from
undistributed income to the unitholders capital account in the statement of
changes in net assets attributable to unitholders.
Financial assets classified as loans and receivables are carried at amortised
cost using the effective interest rate method, less impairment losses, if any.
Financial liabilities, other than those designated as at fair value through
profit or loss, are measured at amortised cost using the effective interest rate
method.
Financial liabilities arising from the redeemable units issued by the Scheme,
are carried at the redemption amount representing the unitholders` right to the
residual interest in the net assets of the Scheme.
1.4.4. Fair value measurement principles
The fair value of quoted instruments is based on their quoted bid market prices
at the balance sheet date without any deduction for estimated future selling
costs.
If a quoted market price is not available on a recognised stock exchange or from
a broker for non-exchange-traded financial instruments, the fair value of the
instrument is estimated using valuation techniques, including use of recent
arm`s length market transactions, reference to the current fair value of another
instrument that is substantially the same, discounted cash flow techniques,
option pricing models or other valuation techniques that provide a reliable
estimate of prices obtained in actual market transactions.
Where discounted cash flow analyses are used, estimated future cash flows are
based on the Management Company`s best estimates and the discount rate that
reflects market rates at the balance sheet date for an instrument with a similar
term and condition.
Investments in other open-ended collective investment schemes are recorded at
the quoted net asset value per unit as reported by the managers of such schemes.
To the extent that the fair values of unlisted equity instruments cannot be
measured reliably, such instruments are carried at cost less impairments.
1.4.5 Cash and cash equivalents
For the purpose of the cash flow statement, cash equivalents are short-term
highly liquid instruments that are readily convertible to known amounts of cash,
are subject to an insignificant risk of changes in value and that are not held
for investing purposes. For the majority of the unit portfolios within the
Scheme, this comprises margin deposits and call and current deposits with banks,
net of bank overdrafts. Given the short duration of instruments held by Money
Market Funds, all the instruments in these unit portfolios are classified as
cash equivalents. Cash equivalents are measured at fair value.
1.4.6. Offsetting
Financial assets and liabilities are offset and the net amount reported in the
balance sheet, where there is a legal right to set off the amounts and there is
an intention to either settle on a net basis or to realise the asset and settle
the liability simultaneously.
Income and expense items are offset only to the extent that their related
instruments have been offset in the balance sheet.
1.4.7. Impairment of financial assets
The Scheme assesses at each balance sheet date whether there is any objective
evidence that a financial asset carried at amortised cost or a group of
financial assets, excluding financial assets at fair value through profit or
loss, is impaired.
Items carried at amortised cost
If there is objective evidence that an impairment loss on loans or receivables
carried at amortised cost has been incurred, the amount of the loss is measured
as the difference between the asset`s carrying amount and the present value of
estimated future cash flows (excluding credit losses that have not been
incurred) discounted at the financial asset`s original effective interest rate.
The carrying amount of the asset is reduced either directly or through the use
of an allowance account. The impairment loss is recognised in net profit or
loss.
The Scheme first assesses whether objective evidence of impairments exists
individually for financial assets that are individually significant, and
individually or collectively for financial assets that are not individually
significant. If it is determined that no objective evidence of impairment exists
for an individually assessed financial asset, whether significant or not, the
asset is included in a group of financial assets with similar credit risk
characteristics and that group is collectively assessed for impairment.
If, in a subsequent period, the amount of impairment loss decreases and the
decrease can be related objectively to an event occurring after the impairment
was recognised, the previously recognised impairment loss is reversed. Any
subsequent reversal of an impairment loss is recognised in the income statement
to the extent that the carrying value of the assets does not exceed its
amortised cost at the reversal date.
1.5.Dividend income
Dividend income comprises dividends received from and accrued on investments for
which the last date to trade falls within the accounting period. This includes
capitalisation issues with a cash dividend option, dividends on preference
shares, convertible debentures and exchange traded funds.
1.6. Interest income
Interest income is recognised in the income statement, using the effective
interest method taking into account the expected timing and the amount of cash
flows.
Interest income includes the amortisation of any discount or premium or any
other difference between an interest-bearing instrument`s initial carrying value
and its maturity value calculated on an effective interest rate basis.
Interest income on debt instruments carried at fair value through profit or loss
is accrued using the original effective interest rate applied to the cost of the
instrument and is included in interest income in the income statement.
1.7.Collective Investment Scheme Income
Income from Collective Investment Scheme`s are recognised on the date of
distributions.
1.8. Expenses
All expenses are recognised in the income statement on an accrual basis.
1.9. Taxation
Under the current system of taxation in South Africa, the Scheme is exempt from
paying taxes on income or capital gains. Both income and capital gains are taxed
in the hands of the unitholders.
Dividend and interest income received by the Funds may be subject to withholding
taxes imposed in the country of origin. Investment income is recorded net of
such withholding taxes.
1.10. Redeemable units
All redeemable units issued by the Scheme provides investors with the right to
require redemption for cash at the value proportionate to the investors share in
the Scheme`s net assets at redemption date. In accordance with AC125, such
instruments give rise to a financial liability for the present value of the
redemption amount. In accordance with the Trust Deed, the Scheme is
contractually obliged to redeem units at the net asset value price.
1.11. Finance costs
Distributions payable on redeemable units are recognised in the income statement
as finance costs.
30 June 2008
Cape Town
Sponsor
Investec Bank Limited
Date: 30/06/2008 17:14:01 Produced by the JSE SENS Department.
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