Global Equity – Growth Fund
Upcoming SlideShare
Loading in...5
×

Like this? Share it with your network

Share

Global Equity – Growth Fund

  • 456 views
Uploaded on

 

  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Be the first to comment
    Be the first to like this
No Downloads

Views

Total Views
456
On Slideshare
456
From Embeds
0
Number of Embeds
0

Actions

Shares
Downloads
1
Comments
0
Likes
0

Embeds 0

No embeds

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
    No notes for slide

Transcript

  • 1. Annual financial report 30 June 2009 Global Equity – Growth Fund Contents Directors’ report The Directors of National Mutual Funds Management Limited (a wholly 1 Directors’ report owned subsidiary of AXA Asia Pacific Holdings Limited), the ‘Responsible Entity’ of the Global Equity – Growth Fund, present their report together 3 Auditor’s independence with the financial report of the Global Equity – Growth Fund (the ‘Fund’) declaration for the year ended 30 June 2009. In order to comply with provisions of the Corporations Act 2001, the Directors report as follows: 4 Independent auditor’s report Principal activities 6 Directors’ declaration The principal activity of the Fund is to invest funds in accordance with its investment objectives and guidelines as set out in the current Product 6 Income statement Disclosure Statement and in accordance with the provisions of the Fund Constitution. 7 Balance sheet The Fund invests predominantly in an unlisted managed investment scheme, the Wholesale Global Equity – Growth Fund ARSN 091 554 371 (‘Underlying 7 Statement of recognised Fund’). The Underlying Fund has investments in a diversified portfolio of global income and expense stocks and may invest in derivative instruments (such as currency contracts and warrants) and cash and cash equivalents. 7 Cash flow statement There were no significant changes in the nature of the Fund’s activities during the year. 8 Notes to the financial statements Directors The following persons held office as Directors of National Mutual Funds Management Limited during the year or since the end of the year and up to the date of this report: D S Craine E A Foley W J Lee I C Campbell G L Dickson (Resigned 22 May 2009) P Sampson (Appointed 10 October 2008) P E Akopiantz (Appointed 29 October 2008) K W Keenan (Appointed 29 October 2008) Review and results of operations The Fund maintains its investment strategy in unlisted managed investment schemes and cash and cash equivalents. The investment policy of the Fund continues to be that detailed in the current Product Disclosure Statement and in accordance with the provisions of the Fund Constitution. Global Equity – Growth Fund ARSN 096 853 280
  • 2. Global Equity – Growth Fund Annual financial report 30 June 2009 Directors’ report (continued) Options granted No options were: Results (i) Granted over unissued units in the Fund during or since the The performance of the Fund, as represented by the results of end of the financial year; or its operations, was as follows: (ii) Granted to the Responsible Entity. Year ended No unissued units in the Fund were under option as at the date on which this report is made. 30 June 2009 30 June 2008 $ $ No units were issued in the Fund during or since the end of Operating loss before finance (3,305,714) (2,838,619) the financial year as a result of the exercise of an option over costs attributable to unit holders unissued units in the Fund. Indemnification and insurance Distributions of officers and auditors Year ended During or since the end of the financial year, the Responsible Entity has not indemnified or made a relevant agreement to 30 June 2009 30 June 2008 $ $ indemnify an officer of the Responsible Entity or auditor of the Fund or of any related corporate body against a liability incurred Distributions to unit holders – – by an officer of the Responsible Entity or auditor of the Fund. In addition, the Responsible Entity has not paid, or agreed to pay, The key differences between unit pricing and financial reporting a premium in respect of a contract insuring against a liability have been outlined below: incurred by an officer of the Responsible Entity or auditor of the Fund. Year ended 30 June 2009 30 June 2008 Fund information in the financial report $ $ Net assets for unit pricing purposes 6,605,657 9,986,964 Fees paid to the Responsible Entity and its associates out of the Fund property during the year are disclosed in Note 10 of Adjustment for changes in valuation (13,012) (19,640) of financial assets held at fair value the financial statements. Reclassification of net assets (6,592,645) (9,967,324) The number of units in the Fund held by the Responsible attributable to unit holders Entity or its associates as at the end of the financial year are to liabilities disclosed in Note 10 of the financial statements. Net assets for financial reporting – – The number of interests in the Fund issued during the financial purposes year, withdrawals from the Fund during the financial year, and the number of interests in the Fund at the end of the financial Significant changes in state of affairs year are disclosed in Note 6(a) of the financial statements. During the financial year, there were no significant changes in The value of the Fund’s assets as at the end of the financial year the state of affairs of the Fund other than that referred to in is disclosed in the Balance Sheet as ‘Total Assets’ and the basis the financial statements or notes thereto. of valuation is included in Note 1 to the financial statements. Subsequent events Independence declaration by Auditor There has not been any matter or circumstance, other than A copy of the Auditor’s independence declaration as required that referred to in the financial statements or notes thereto, under section 307C of the Corporations Act 2001 is set out on that has arisen since the end of the financial year, that has page 3. significantly affected, or may significantly affect, the operations Signed in accordance with a resolution of the Directors of the of the Fund, the results of those operations, or the state of Responsible Entity made pursuant to section 298(2) of the affairs of the Fund in future financial years. Corporations Act 2001. On behalf of the Directors Future developments The Fund will continue to be managed in accordance with its investment objectives and guidelines as set out in the current Product Disclosure Statement and in accordance with the provisions of the Fund Constitution. Future results will accordingly depend on the performance of the markets to Elizabeth Foley which the Fund is exposed. Director Melbourne 16 September 2009 2
  • 3. Global Equity – Growth Fund Annual financial report 30 June 2009 Auditor’s independence declaration 3
  • 4. Global Equity – Growth Fund Annual financial report 30 June 2009 Independent auditor’s report 4
  • 5. Global Equity – Growth Fund Annual financial report 30 June 2009 Independent auditor’s report (continued) 5
  • 6. Global Equity – Growth Fund Annual financial report 30 June 2009 Directors’ declaration Income statement For the year ended 30 June 2009 The financial statements and the notes thereto of the Global Equity – Growth Fund (the ‘Fund’) for the financial year ended 30 June 2009 have been prepared by National Mutual Funds Year ended Management Limited (the ‘Responsible Entity’) in accordance 30 June 2009 30 June 2008 with the Corporations Act 2001. Notes $ $ The Directors of the Responsible Entity declare that: Investment income (a) In the Directors’ opinion, there are reasonable grounds to Distribution income 10 – 75,611 believe that the Fund will be able to pay its debts as and Interest income 294 2,029 when they become due and payable; and Net losses on financial 5 (3,228,014) (2,798,664) (b) In the Directors’ opinion, the attached financial statements instruments held at fair and notes thereto are in accordance with the Corporations value through profit Act 2001, including compliance with accounting standards or loss and giving a true and fair view of the financial position and Other investment income – 5,184 performance of the Fund. Total investment loss (3,227,720) (2,715,840) Signed in accordance with a resolution of the Directors of the Expenses Responsible Entity made pursuant to section 295(5) of the Management fees 7,10 52,313 99,538 Corporations Act 2001. Auditor’s remuneration 8 18,607 18,502 On behalf of the Directors Other operating 7,074 4,739 expenses Total operating expenses 77,994 122,779 Operating loss (3,305,714) (2,838,619) Finance costs attributable Elizabeth Foley to unit holders Director Decrease in net assets 6(b) 3,305,714 2,838,619 Melbourne attributable to unit holders 16 September 2009 Profit/(loss) for the year – – The above income statement should be read in conjunction with the accompanying notes. 6
  • 7. Global Equity – Growth Fund Annual financial report 30 June 2009 Balance sheet Cash flow statement As at 30 June 2009 For the year ended 30 June 2009 As at Year ended 30 June 2009 30 June 2008 30 June 2009 30 June 2008 Notes $ $ Notes $ $ Assets Cash flows from operating Cash and cash equivalents 125,996 143,520 activities Receivables 3 392 76,721 Interest received 406 1,917 Financial assets held at 2,10 6,495,086 9,799,790 Other income received 606 8,006 fair value through profit Management fees paid (59,118) (97,028) or loss Payment of other expenses (42,754) – Total assets 6,621,474 10,020,031 Net cash used in 12(a) (100,860) (87,105) Liabilities (excluding net operating activities assets attributable to Cash flows from investing unit holders) activities Payables 4 28,829 52,707 Proceeds from sale of 1,140,301 2,157,000 Total liabilities (excluding 28,829 52,707 investments net assets attributable to Payments for purchase of (988,000) (2,203,601) unit holders) investments Net assets attributable to 6 6,592,645 9,967,324 Net cash provided by/ 152,301 (46,601) unit holders – liability (used in) investing Net assets – – activities Cash flows from financing The above balance sheet should be read in conjunction with activities the accompanying notes. Proceeds from applications 1,391,420 2,193,431 by unit holders Payments for redemptions (1,460,385) (2,244,173) by unit holders Statement of recognised Net cash used in financing (68,965) (50,742) income and expense activities Net decrease in cash and (17,524) (184,448) For the year ended 30 June 2009 cash equivalents Cash and cash equivalents 143,520 327,968 Year ended at the beginning of the year 30 June 2009 30 June 2008 Cash and cash 12(b) 125,996 143,520 $ $ equivalents held at the Profit/(loss) for the year – – end of the year Total recognised income and – – Non-cash operating and 12(c) expense for the year investing activities The above statement of recognised income and expense The above cash flow statement should be read in conjunction should be read in conjunction with the accompanying notes. with the accompanying notes. 7
  • 8. Global Equity – Growth Fund Annual financial report 30 June 2009 Notes to the financial statements Judgments made by management in the application of Australian Accounting Standards that have significant effects on the financial statements and estimates with a significant Section Page risk of material adjustments in the next year are disclosed, where applicable, in the relevant notes to the financial 1 Summary of significant accounting policies 8 statements. 2 Financial assets held at fair value through Compliance with International Financial profit or loss 10 Reporting Standards (IFRS) 3 Receivables 11 Compliance with Australian Accounting Standards ensures that the financial report of the Fund, comprising the financial 4 Payables 11 statements and notes thereto, complies with International 5 Net losses on financial instruments held Financial Reporting Standards. at fair value through profit or loss 11 (b) Financial instruments 6 Net assets attributable to unit holders 11 (i) Classification 7 Management fees 12 The Fund’s investments are categorised as at fair value through 8 Auditor’s remuneration 12 profit or loss. They comprise: 9 Segment information 12 ∙ Financial instruments designated at fair value through profit or loss upon initial recognition 10 Related party transactions 12 These are investments in unlisted managed investment schemes. 11 Financial risk management 13 Financial assets and financial liabilities designated at fair 12 Notes to the cash flow statement 16 value through profit or loss at inception are those that are managed and their performance evaluated on a fair value 13 Additional information 16 basis in accordance with the Fund’s documented investment strategy. The Fund’s policy is for the Responsible Entity to evaluate the information about these financial assets and 1 Summary of significant accounting policies financial liabilities on a fair value basis together with other The principal accounting policies applied in the preparation of related financial information. these financial statements are set out below. These policies have been consistently applied to all years presented, unless (ii) Recognition/derecognition otherwise stated in the following text. The Fund recognises financial assets and financial liabilities on the date it becomes party to the contractual agreement (trade (a) Basis of preparation date) and recognises changes in fair value of the financial This general purpose financial report has been prepared assets or financial liabilities from this date. in accordance with Australian Accounting Standards, other Investments are derecognised when the right to receive cash authoritative pronouncements and interpretations of the flows from the investments have expired or the Fund has Australian Accounting Standards Board and the Corporations transferred substantially all risks and rewards of ownership. Act 2001 in Australia. (iii) Measurement The financial report has been prepared on the basis of historical cost, except for the revaluation of certain non-current Financial assets and liabilities held at assets and financial instruments. Cost is based on the fair fair value through profit or loss values of the consideration given in exchange for assets. All Financial assets and liabilities held at fair value through amounts are presented in Australian dollars. profit or loss are measured initially at fair value excluding In the application of Australian Accounting Standards any transaction costs that are directly attributable to the management is required to make judgments, estimates and acquisition or issue of the financial asset or financial liability. assumptions about carrying values of assets and liabilities Transaction costs on financial assets and financial liabilities that are not readily apparent from other sources. The at fair value through profit or loss are expensed immediately. estimates and associated assumptions are based on historical Subsequent to initial recognition, all instruments held at fair experience and various other factors that are believed to be value through profit or loss are measured at fair value with reasonable under the circumstance, the results of which form changes in their fair value recognised in the income statement. the basis of making the judgments. Actual results may differ ∙ Fair value in an inactive or unquoted market from these estimates. Investments in unlisted managed investment schemes are The estimates and underlying assumptions are reviewed on recorded at fair value represented by the redemption value an ongoing basis. Revisions to accounting estimates are per unit as reported by the managers of such funds. recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. 8
  • 9. Global Equity – Growth Fund Annual financial report 30 June 2009 1 Summary of significant accounting (h) Distributions policies (continued) In accordance with the Fund Constitution, the Fund fully distributes its realised distributable (taxable) income to (b) Financial instruments (continued) unit holders by cash or reinvestment. The distributions (iv) Offsetting financial instruments are recognised in the income statement as finance costs attributable to unit holders. Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally Distributions to unit holders comprise the taxable income of the enforceable right to offset the recognised amounts and there Fund. The distributions are payable at the end of June each year. is an intention to settle on a net basis, or realise the asset and settle the liability simultaneously. (i) Applications and redemptions Applications received for units in the Fund are recorded net of (c) Net assets attributable to unit holders any entry fees payable prior to the issue of units in the Fund. Units are redeemable at the unit holders’ option and are Redemptions from the Fund are recorded gross of any exit fees therefore classified as financial liabilities. The units can be put payable after the cancellation of units redeemed. back to the Fund at any time for cash equal to a proportionate The application and redemption prices are determined as the share of the Fund’s net asset value. The fair value of net asset value of the Fund per the constitution adjusted for redeemable units is measured at the redemption amount that the estimated transaction costs, divided by the number of units is payable (based on the redemption unit price) at the balance on issue on the date of the application or redemption. sheet date if unit holders exercised their right to put the units back to the Fund. (j) Increase/decrease in net assets attributable to unit holders (d) Cash and cash equivalents Non-distributable income is transferred directly to net assets attributable to unit holders. This balance represents Cash and cash equivalents include cash on hand, deposits unrealised gains and losses due to the change in fair value of held at call with banks, or other short-term highly liquid investments. These gains and losses have been recognised investments net of outstanding bank overdrafts. in the Income Statement in either the current or a previous period, and have not been distributed to unit holders. (e) Investment income Once the gains and losses have been realised these items Interest income is recognised on a time proportionate basis are distributed to unit holders. Income recognition differences taking into account the effective yield on the financial assets. consist of accrued income not yet assessable, expenses Distribution from unlisted managed investment schemes provided or accrued which are not yet deductible, net capital is recognised as of the date the unit value is quoted losses and tax free or tax deferred income. ex-distribution. (k) Goods and Services Tax (GST) (f) Expenses The GST incurred on the costs of various services provided All expenses are recognised in the income statement on an to the Fund by third parties such as management fees and accruals basis. other expenses are recognised net of the amount of goods and services tax (‘GST’) recoverable from the Australian Tax (g) Income tax Office (‘ATO’) as the Fund qualifies for Reduced Input Tax Credit Under current income tax legislation the Fund is not liable to (‘RITC’) at a rate of 75%. pay income tax as the net income of the Fund is assessable Accounts payable and accrued expenses are stated with the in the hands of the beneficiaries (the unit holders) who are amount of GST included. The net amount of GST recoverable ‘presently entitled’ to the income of the Fund. There is no from the ATO is included as a current asset or liability in the income of the Fund to which the unit holders are not presently Balance Sheet. Cash flows are included in the cash flow entitled and additionally, the Fund Constitution requires the statement on a gross basis. distribution of the full amount of the net income of the Fund to The GST component of cash flows arising from investing and the unit holders each period. financing activities which is recoverable from, or payable to, the As a result, deferred taxes have not been recognised in the taxation authority is classified as operating cash flows. financial statements in relation to differences between the carrying amounts of assets and liabilities and their respective (l) Receivables tax bases, including taxes on capital gains which could arise in Receivables are recorded at amortised cost less impairment the event of a sale of investments for the amount at which they and may include amounts for distributions and interest. are stated in the financial statements. In the event that taxable Distributions are accrued when the right to receive payment is gains are realised by the Fund, these gains would be included established. Interest is accrued at the reporting date from the in the taxable income that is assessable in the hands of the time of last payment. Amounts are generally received within 30 unit holders as noted above. days of being recorded as receivables. Realised capital losses are not distributed to unit holders but are retained in the Fund to be offset against any realised capital gains. If realised capital gains exceed realised capital losses, the excess is distributed to unit holders. 9
  • 10. Global Equity – Growth Fund Annual financial report 30 June 2009 1 Summary of significant accounting (iii) AASB 132 Financial Instruments: Presentation and policies (continued) AASB 2008-2 Amendments to Australian Accounting Standards – Puttable Financial Instruments and (m) Payables Obligations Arising on Liquidation (Revised AASB 132) Trade payables and other accounts payable are recognised Revised AASB 132 is applicable for reporting periods beginning when the Fund becomes obliged to make future payments on or after 1 January 2009. The Fund has not adopted this resulting from the purchase of goods and services. standard early. Application of this standard will not affect any of the amounts recognised in the financial statements as (n) Provisions the Fund is obligated to distribute all of its taxable income in accordance with the Fund Constitution. Accordingly, there will Provisions are recognised when the Fund has a present be no change to the classification of unit holders’ funds as a obligation, the future sacrifice of economic benefits is probable, liability and therefore no impact on profit or loss and equity. and the amount of the provision can be measured reliably. When some or all of the economic benefits required to settle a (iv) AASB 2009-2 Amendments to Australian provision are expected to be recovered from a third party, the Accounting Standards – Improving receivable is recognised as an asset if it is virtually certain that Disclosures about Financial Instruments recovery will be received and the amount of the receivable can AASB 2009-2 is applicable for reporting periods beginning on or be measured reliably. after 1 January 2009. It amends AASB 7 Financial Instruments: The amount recognised as a provision is the best estimate of Disclosures to require enhanced disclosures about fair value the consideration required to settle the present obligation at measurements and liquidity risk. reporting date, taking into account the risks and uncertainties Among other things, the amendments: surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, ∙ clarify that the existing AASB 7 fair value disclosures must be made separately for each class of financial instrument its carrying amount is the present value of those cash flows. ∙ add disclosure of any change in the method for determining (o) Segment reporting fair value and the reasons for the change A business segment is identified for a group of assets and ∙ establish a three-level hierarchy for making fair value measurements used in the disclosures operations engaged in providing products or services that are subject to risks and returns that are different to those of other ∙ clarify that the current maturity analysis for non-derivative business segments. A geographical segment is identified when financial instruments should include issued financial products or services are provided within a particular economic guarantee contracts and disclosure of a maturity analysis for environment subject to risks and returns that are different from derivative financial liabilities. those of segments operating in other economic environments. Comparative information is not required to be provided in the first year the amendments are applied. Application of this (p) New accounting standards and interpretations standard will affect the financial instruments disclosures Certain new accounting standards and interpretations have provided in Note 11. been published that are relevant to the Fund but are not mandatory for 30 June 2009 reporting periods. The Directors’ 2 Financial assets held at fair value assessment of the impact of these new standards (to the through profit or loss extent relevant to the Fund) and interpretations is set below: (i) AASB 8 Operating Segments and AASB As at 2007-3 Amendments to Australian Accounting 30 June 2009 30 June 2008 Standards arising from AASB 8 Notes $ $ AASB 8 and AASB 2007-3 are applicable to annual reporting Designated at fair value periods beginning on or after 1 January 2009. The Fund through profit or loss has not adopted these standards early. Application of these Unlisted managed 10 6,495,086 9,799,790 standards will not affect any of the amounts recognised in the investment schemes financial statements, but may affect the segment disclosures Total designated at fair 6,495,086 9,799,790 provided in Note 9. value through profit or loss Total financial assets held 6,495,086 9,799,790 (ii) Revised AASB 101 Presentation of Financial at fair value through profit Statements and AASB 2007-8 Amendments to or loss Australian Accounting Standards arising from AASB 101 AASB 101 (Revised) is applicable to annual reporting periods beginning on or after 1 January 2009. The Fund has not adopted this standard early. It requires the presentation of a statement of comprehensive income and makes changes to the statement of changes in equity but will not affect any of the amounts recognised in the financial statements. If the Fund makes a prior period adjustment or re-classifies items in the financial statement, it will need to disclose a third balance sheet (statement of financial position), this one being at the beginning of the comparative period. 10
  • 11. Global Equity – Growth Fund Annual financial report 30 June 2009 3 Receivables 5 Net losses on financial instruments held at fair value through profit or loss As at Net losses recognised in relation to financial instruments held 30 June 2009 30 June 2008 at fair value through profit or loss: $ $ Distribution receivable – 75,611 Year ended Interest receivable – 112 30 June 2009 30 June 2008 Other receivables 392 998 $ $ 392 76,721 Financial assets The Fund’s receivables are categorised as Loans and Net loss on financial assets (3,228,014) (2,798,664) designated at fair value through Receivables. profit or loss Net losses on financial assets (3,228,014) (2,798,664) 4 Payables held at fair value through profit or loss As at Total net losses on financial (3,228,014) (2,798,664) 30 June 2009 30 June 2008 instruments held at fair value $ $ through profit or loss Management fee payable 72 6,877 Other unsecured payables 28,757 45,830 and accrued expenses 28,829 52,707 6 Net assets attributable to unit holders As stipulated within the Fund Constitution, each unit represents a right to an individual share in the Fund and does not extend to a right to the underlying assets of the Fund. There are no separate classes of units and each unit has the same rights attaching to it as all other units of the Fund. Movements in units on issue and undistributed loss attributable to unit holders during the year were as follows: (a) Units on issue Year ended Year ended 30 June 2009 30 June 2008 30 June 2009 30 June 2008 No. No. $ $ Opening balance 15,165,958 15,260,906 13,001,752 12,973,570 Applications 2,661,210 2,762,641 1,391,420 2,193,431 Redemptions (2,714,029) (2,857,589) (2,199,435) (2,165,249) Closing balance 15,113,139 15,165,958 12,193,737 13,001,752 (b) Movement in undistributed loss attributable to unit holders Year ended 30 June 2009 30 June 2008 $ $ Opening balance (3,034,428) (116,885) Net liabilities/(assets) redeemed 739,050 (78,924) Decrease in net assets attributable to unit holders (3,305,714) (2,838,619) Closing balance (5,601,092) (3,034,428) Total net assets attributable to unit holders 6,592,645 9,967,324 11
  • 12. Global Equity – Growth Fund Annual financial report 30 June 2009 7 Management fees Key management personnel In accordance with the Product Disclosure Statement, the MER Key management personnel includes persons who were of the Fund is capped at an annual equivalent of 2% (2008: 2%). Directors of National Mutual Funds Management Limited at any To the extent that the MER cap would be exceeded, the time during the financial year as follows: Responsible Entity has waived its management fees to ensure D S Craine the MER remains below the cap. E A Foley W J Lee 8 Auditor’s remuneration I C Campbell G L Dickson (Resigned 22 May 2009) Year ended P Sampson (Appointed 10 October 2008) P E Akopiantz (Appointed 29 October 2008) 30 June 2009 30 June 2008 $ $ K W Keenan (Appointed 29 October 2008) Audit of the financial report 8,830 9,000 Key management personnel compensation Other audit services 9,777 9,502 Key management personnel are paid by a related party of 18,607 18,502 the Responsible Entity. Payments made from the Fund to The auditor of the Global Equity – Growth Fund is Deloitte the Responsible Entity do not include any amounts directly Touche Tohmatsu. attributable to compensation of key management personnel. 9 Segment information Other key management personnel There were no other persons with responsibility for planning, Business segments directing and controlling the activities of the Fund, directly or indirectly during the financial year. The Fund operates solely in the business of financial investment and derives income from unlisted managed investment schemes and cash and cash equivalents. Holdings of units During or since the end of the financial year, none of the key Geographical segments management personnel and/or their related entities held units in the Fund, either directly, indirectly or beneficially (2008: Nil). The Fund operates solely in Australia and derives income from both within and outside Australia. Overseas income is derived Holdings of units by related parties from holdings in the Wholesale Global Equity – Growth Fund. As at 30 June 2009 30 June 2008 10 Related party transactions $ $ National Mutual Life Association of 4,822,487 4,812,160 Responsible Entity Australasia Limited + The Responsible Entity of the Global Equity – Growth Fund is National Mutual Funds 1,064 1,064 National Mutual Funds Management Limited. The Responsible Management Limited Entity is a wholly owned subsidiary of AXA Asia Pacific Holdings + A related party of the Responsible Entity Limited whose ultimate parent entity is AXA S.A., a company incorporated in France. Accordingly transactions with entities Transactions with related parties related to AXA Asia Pacific Holdings Limited are disclosed below. Transactions with related parties are conducted on normal commercial terms and conditions. Management fees of $52,313 (2008: $99,538), calculated in accordance with Note 7, were paid or payable to the Responsible Entity. No amounts were paid by the Fund directly to the Directors of National Mutual Funds Management Limited. Investments The Fund held investments in the following fund which is also managed by the Responsible Entity or its related parties: Fair value of investment Interest held Distributions received/receivable 2009 2008 2009 2008 2009 2008 $ $ % % $ $ Wholesale Global Equity – Growth Fund 6,495,086 9,799,790 0.91 0.86 — 75,611 Total 6,495,086 9,799,790 — 75,611 There are no distributions received/receivable in respect of the Wholesale Global Equity – Growth Fund which remains unpaid at the reporting date (2008: $75,611). 12
  • 13. Global Equity – Growth Fund Annual financial report 30 June 2009 11 Financial risk management (a) Market risk Market risk is the risk that the fair value of future cash flows Management of financial instruments of a financial instrument will fluctuate because of changes The investments of the Fund (other than cash held for meeting in market prices. Market risk comprises three types of risk: daily administrative expenses), are managed by National market prices (price risk), foreign exchange (currency risk) and Mutual Funds Management Limited, the Responsible Entity. market interest rates (interest rate risk). There has been no change in the period to the Fund’s exposure to market risks or State Street Australia Limited acts as master custodian the manner in which it manages and measures the risk. on behalf of the Responsible Entity and, as such, provides services including physical custody and safekeeping of assets, The Fund is exposed to currency risk, interest rate risk and settlement of trades, collection of dividends and accounting for price risk indirectly via its investments in unlisted managed investment transactions. investment schemes. The impact of possible changes in market risk on operating profit and net assets attributable to unit Significant accounting policies holders will depend on the particular asset allocations of these managed investment schemes. Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of (i) Price Risk measurement and the basis on which revenues and expenses The Fund is exposed to the price risk in relation to its units are recognised, in respect of each class of financial asset in the underlying funds as prices in the future are uncertain. and financial liability, are disclosed in Note 1 to the financial The units in the underlying funds are classified on the balance statements. sheet as at fair value through profit or loss. Capital risk management Price risk is the risk that the total value of investments will fluctuate as a result of changes in market prices, whether The Fund considers its net assets attributable to unit holders caused by factors specific to an individual investment, its as capital, notwithstanding net assets attributable to unit issuer or all factors affecting all instruments traded in the holders are classified as a liability. The amount of net assets market. The Responsible Entity monitors the performance attributable to unit holders can change significantly on a of the underlying funds and reviews audited annual financial daily basis as the Fund is subject to daily applications and statements of the underlying funds in order to assess their redemptions at the discretion of unit holders. compliance with their respective Product Disclosure Statement. The Investment Manager aims to ensure that there is sufficient The value of the Fund’s investment in the underlying funds will capital for possible redemptions by unit holders by maintaining move in direct correlation to the performance of the underlying a minimum of its total investments in cash and cash funds. Price risk disclosures have not been prepared on a equivalents. look-through basis for investments held indirectly through the The Fund’s overall investment strategy remains unchanged underlying funds. from the prior year. (ii) Foreign exchange risk Categories of financial instruments The Fund does not have any direct exposure to foreign exchange risk based on the Fund’s direct investment in the The categories of financial instruments are financial assets held underlying funds, which issue units denominated in Australian at fair value through profit or loss which are disclosed in Note 2 dollars. However, the underlying funds may hold investments and loans and receivables which are disclosed in Note 3. denominated in foreign currencies in accordance with their respective Product Disclosure Statement. The Responsible Entity Financial risk management objectives monitors the performance of the underlying funds and reviews The Fund is exposed to a variety of financial risks as a result audited annual financial statements in order to assess their of its activities. These risks include market risk (including compliance with their respective Product Disclosure Statement. currency risk, fair value interest rate risk and price risk), credit The foreign exchange risk disclosures have not been prepared risk, liquidity risk and cash flow interest rate risk. The Fund’s on a look-through basis for investments held indirectly risk management and investment policies, approved by the through underlying funds. Consequently, the disclosure of Responsible Entity, seek to minimise the potential adverse foreign exchange risk in the note may not represent the true effects of these risks on the Fund’s financial performance. foreign exchange risk profile of the Fund where the Fund has The Fund’s investment mandate is to invest in unlisted significant investments in underlying funds which also have managed investment schemes and cash and cash equivalents. exposure to foreign exchange risk. 13
  • 14. Global Equity – Growth Fund Annual financial report 30 June 2009 11 Financial risk management (continued) (a) Market risk (continued) (iii) Interest rate risk The interest rate risk disclosures have been prepared on the basis of the Fund’s direct investment and not on a look-through basis for investments held indirectly through underlying funds. Consequently, the disclosure of interest rate risk in the note many not represent the true interest rate risk profile of the Fund where the Fund has significant investments in underlying funds which also have exposure to the interest rate markets. The table below summarises the Fund’s exposure to interest rate risks. Floating Fixed Non-interest interest rate interest rate bearing Total 30 June 2009 $ $ $ $ Assets Cash and cash equivalents 125,996 – – 125,996 Receivables – – 392 392 Financial assets held at fair value through profit or loss – – 6,495,086 6,495,086 Total assets 125,996 – 6,495,478 6,621,474 Liabilities (excluding net assets attributable to unit holders) Payables – – 28,829 28,829 Total liabilities (excluding net assets attributable to unit holders) – – 28,829 28,829 Net assets attributable to unit holders – liability – – 6,592,645 6,592,645 Floating Fixed Non-interest interest rate interest rate bearing Total 30 June 2008 $ $ $ $ Assets Cash and cash equivalents 143,520 – – 143,520 Receivables – – 76,721 76,721 Financial assets held at fair value through profit or loss – – 9,799,790 9,799,790 Total assets 143,520 – 9,876,511 10,020,031 Liabilities (excluding net assets attributable to unit holders) Payables – – 52,707 52,707 Total liabilities (excluding net assets attributable to unit holders) – – 52,707 52,707 Net assets attributable to unit holders – liability – – 9,967,324 9,967,324 An analysis of financial liabilities by maturities is provided in paragraph 11(c) below. The majority of the Fund’s directly held financial assets are non-interest bearing securities that have no exposure to interest rate movement and therefore have minimal exposure to interest rate risk. As a result, there is little to no sensitivity to interest rate risk. 14
  • 15. Global Equity – Growth Fund Annual financial report 30 June 2009 11 Financial risk management (continued) (b) Credit risk Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Fund. The Fund is exposed to credit risk in relation to its units in the underlying funds. Credit risk arises from the underlying funds’ ability to realise their investments to meet any redemptions made by the Fund. The risk is measured by reference to the available net assets in the underlying funds. The Fund’s policy is to only invest in funds managed by a responsible entity included on the Board’s approved responsible entities listing. Approval is determined based on a number of factors, including historical performance and documented risk management procedures. Compliance with the Fund’s policy is reported to the Board on an exceptions basis. The Fund does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics. The table below shows the maximum exposure to credit risk at the reporting date. It is the opinion of the Responsible Entity that the carrying amounts of these financial assets represent the maximum credit risk exposure at the balance sheet date. As at 30 June 2009 30 June 2008 $ $ Cash and cash equivalents 125,996 143,520 Receivables 392 76,721 Financial assets held at fair value through profit or loss 6,495,086 9,799,790 Total 6,621,474 10,020,031 None of these assets are impaired or past due but not impaired. (c) Liquidity risk The Fund’s approach to managing liquidity is to ensure that it will always have sufficient liquidity to meet its liabilities. Unit holders are able to withdraw their units at any time and the Fund is therefore exposed to the liquidity risk of meeting unit holders’ withdrawals at any time. The Fund invests in the underlying fund traded over the counter, or which are not traded in an organised market and which generally may be illiquid. As a result, there is a risk that the Fund may not be able to liquidate quickly its investments in these instruments at an amount close to their fair value to meet its liquidity requirement. The Fund’s liquidity risk is managed in accordance with the Fund’s investment strategy. The Fund manages liquidity risk by maintaining adequate banking facilities and through the continuous monitoring of forecast and actual cash flows. The Fund’s overall strategy for liquidity risk management remains unchanged from 2008. The following tables summarise the maturity profile of the Fund’s financial liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Fund can be required to pay. Balances due within 12 months equal their carrying value as the impact of discounting is not significant. Due on Less than 3 months 1-5 5+ demand 3 months to 1 year years years $ $ $ $ $ At 30 June 2009 Payables 28,829 – – – – Net assets attributable to unit holders – liability 6,592,645 – – – – Total financial liabilities 6,621,474 – – – – At 30 June 2008 Payables 52,707 – – – – Net assets attributable to unit holders – liability 9,967,324 – – – – Total financial liabilities 10,020,031 – – – – (d) Fair value of financial assets and financial liabilities The Fund’s financial assets and financial liabilities included in the Balance Sheet are carried at amounts that approximate fair value. The fair value of financial assets and financial liabilities has been determined in accordance with Note 1. 15
  • 16. Global Equity – Growth Fund Annual financial report 30 June 2009 12 Notes to the cash flow statement Year ended 30 June 2009 30 June 2008 Notes $ $ (a) Reconciliation of profit/(loss) to net cash used in operating activities Profit/(loss) for the year – – Decrease in net assets attributable to unit holders 6(b) (3,305,714) (2,838,619) Net losses on financial instruments held at fair value through profit or loss 5 3,228,014 2,798,664 Distribution income reinvested 12(c) (75,611) (39,186) Net change in receivables 76,329 (37,009) Net change in payables (23,878) 29,045 Net cash used in operating activities (100,860) (87,105) (b) Components of cash and cash equivalents Cash and cash equivalents at the end of the financial year as shown in the cash flow statement is reconciled to the balance sheet as follows: Cash at bank 125,996 143,520 (c) Non-cash operating and investing activities Distribution received from investments reinvested in unlisted managed investment schemes 12(a) 75,611 39,186 13 Additional information National Mutual Funds Management Limited, a public company incorporated and operating in Australia, is the Responsible Entity of the Global Equity – Growth Fund. Principal Registered Office and Unit Registry AXA Centre 750 Collins Street DOCKLANDS VIC 3008 Tel: (03) 8688 3911 AXA Customer Service Centre PO Box 14330 Melbourne Victoria 8001 Telephone 131 737 Facsimile (03) 9287 3389 For daily unit price information (Toll Free Australia-wide) 1800 780 085 Email: client.enquiry@axa.com.au axa.com.au 04966-09-09E The National Mutual Life Association of Australasia Limited ABN 72 004 020 437 AFS Licence No. 234649 Member of the Global AXA Group