2016 semi-annual report - desjardins life insurance€¦ · quarterly, this team makes an analysis...

DFS GUARANTEED INVESTMENT FUNDS

Desjardins Insurance refers to Desjardins Financial Security Life Assurance Company.

Financial Information as of June 30, 2016

2016 Semi-Annual Report

SEPTEMBER 2016

DFS Guaranteed Investment Funds are established by Desjardins Financial Security Life Assurance Company.

1DFS GUARANTEED INVESTMENT FUNDS

TABLE OF CONTENTS


Investment Solutions DFS GIF – Conservative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4DFS GIF – Moderate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10DFS GIF – Balanced . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16DFS GIF – Growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22DFS GIF – Maximum Growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

Individual Funds Income

DFS GIF – Money Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36DFS GIF – Income – Fiera Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41DFS GIF – Canadian Bond . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Balanced and Asset Allocation DFS GIF – Diversified Income – Franklin Quotential . . . . . . . . . . . . . . . . . . . . . . . 56DFS GIF – Balanced Income – Franklin Quotential . . . . . . . . . . . . . . . . . . . . . . . . 61DFS GIF – Canadian Balanced – Fidelity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66DFS GIF – U .S . Monthly Income – Fidelity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71DFS GIF – Balanced – Desjardins Societerra . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76DFS GIF – Global Balanced – Jarislowsky Fraser . . . . . . . . . . . . . . . . . . . . . . . . . . 81DFS GIF – Canadian Balanced – Fiera Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86DFS GIF – Canadian Balanced – Franklin Bissett . . . . . . . . . . . . . . . . . . . . . . . . . . 99DFS GIF – Balanced Growth – Franklin Quotential . . . . . . . . . . . . . . . . . . . . . . . 104DFS GIF – Canadian Balanced – CI Signature . . . . . . . . . . . . . . . . . . . . . . . . . . . 109DFS GIF – Income And Growth – CI Signature . . . . . . . . . . . . . . . . . . . . . . . . . . 114DFS GIF – Growth And Income – NEI Northwest . . . . . . . . . . . . . . . . . . . . . . . . 119DFS GIF – Global Growth – NEI Select . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124DFS GIF – Canadian Asset Allocation – CI Cambridge . . . . . . . . . . . . . . . . . . . . 129DFS GIF – Growth – Franklin Quotential . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134

Canadian Equity DFS GIF – Dividend Income – Franklin Bissett . . . . . . . . . . . . . . . . . . . . . . . . . . 139DFS GIF – Canadian Dividend – NEI Northwest . . . . . . . . . . . . . . . . . . . . . . . . . 144DFS GIF – Canadian Equity – Jarislowsky Fraser . . . . . . . . . . . . . . . . . . . . . . . . . 149DFS GIF – Canadian Equity – Fidelity True North® . . . . . . . . . . . . . . . . . . . . . . . 154DFS GIF – Canadian Equity – Franklin Bissett . . . . . . . . . . . . . . . . . . . . . . . . . . . 159DFS GIF – Canadian Equity – Fiera Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164DFS GIF – Specialty Equity – NEI Northwest . . . . . . . . . . . . . . . . . . . . . . . . . . . . 171DFS GIF – Small Cap – Franklin Bissett . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 176

Foreign Equity DFS GIF – American Equity – MFS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 181DFS GIF – American Equity Value – Desjardins . . . . . . . . . . . . . . . . . . . . . . . . . . 186DFS GIF – Global Dividend – Desjardins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191DFS GIF – Global Equity – MFS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 196DFS GIF – International Equity – MFS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 201DFS GIF – International Equity Growth – Desjardins . . . . . . . . . . . . . . . . . . . . . . 206

NOTES TO THE FINANCIAL STATEMENTS – UNAUDITED . . . . . . . . . . . . . . . . . . . . . . . . . . 211

What’s a DFS GIF?

DFS stands for Desjardins Financial Security.

GIF stands for Guaranteed Investment Fund.

A Guaranteed Investment Fund (GIF), commonly known as “segregated fund“ is an investment fund created and issued exclusively by life insurance companies. It is offered through Contracts which provide maturity and death benefit guarantees.

Is this document available online?

Yes, at desjardinslifeinsurance.com/ GIFreports.

Is it possible to opt out of receiving paper copies of this financial report?

Yes. Please send a letter to:

Desjardins Financial Security GIF Administration 1 Complexe Desjardins P.O. Box 9000 Montreal, QC H5B 1H5

Or send an email to:

[email protected].

Please include your name, mailing address, telephone number, email address and client number in your request, and indicate whether your request applies to the annual financial report and/or the semi- annual financial report.

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www.desjardinsassurancevie.com/GIFreports

Investment Solutions


4 DFS GUARANTEED INVESTMENT FUNDS

June 30 2016

$

December 31 2015

$ASSETSCurrent AssetsCash 131,333 70,175 Investments at fair value through profit

or loss (FVTPL) 11,450,455 8,395,967 Premiums receivable 35,188 —Receivable for securities sold — 31,167

11,616,976 8,497,309

LIABILITIESCurrent LiabilitiesAccrued expenses 22,253 16,359 Withdrawals payable 13,703 32,351 Payable for securities purchased 78,049 399

114,005 49,109

NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS 11,502,971 8,448,200

NET ASSETS PER UNITSeries 5 5.15 5 .04 Series 6 5.35 5 .23 Series 7 5.40 5 .26

The accompanying Notes are an integral part of these financial statements.

2016$

2015$

INCOMEInterest for attribution purposes 107,068 64,021 Dividends 28,524 13,221 Changes in fair value:

Net realized gain (loss) on investments 2,108 7,987 Net unrealized gain (loss) on investments 249,338 (2,765)

387,038 82,464

EXPENSESManagement fees and guarantee charge 106,408 54,525 Operating expenses 10,976 5,606

117,384 60,131 Withholding taxes 1,604 699

118,988 60,830

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 268,050 21,634

DATA PER SERIESSERIES 5*Increase (Decrease) in Net Assets

from Operations 13,159 —- per unit 0.22 —

Average Number of Units 59,573 —

SERIES 6Increase (Decrease) in Net Assets

from Operations 212,534 15,802 - per unit 0.14 0 .02

Average Number of Units 1,548,048 820,642



Average Number of Units 267,190 110,078

* Beginning of operations in October 2015.

DFS GIF – CONSERVATIVE

STATEMENT OF FINANCIAL POSITION – unaudited

STATEMENT OF COMPREHENSIVE INCOME – unaudited

As at Six-month Periods Ended June 30



2016$

2015$

NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS, BEGINNING OF PERIOD 8,448,200 2,870,803 Increase (Decrease) in Net Assets

from operations attributable to contract owners 268,050 21,634

PremiumsSeries 5* 577,368 —Series 6 3,482,617 2,954,416 Series 7 1,090,986 597,251

5,150,971 3,551,667

WithdrawalsSeries 5* (137,122) —Series 6 (1,458,909) (408,481)Series 7 (768,219) (10,000)

(2,364,250) (418,481)

NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS, END OF PERIOD 11,502,971 6,025,623

2016$

2015$

CASH FLOWS FROM (USED IN) OPERATING ACTIVITIESIncrease (Decrease) in Net Assets


Adjustments for:Net realized gain (loss) (2,108) (7,987)Net unrealized gain (loss) (249,338) 2,765

Proceeds from sale/maturity of investments 1,438,385 258,992

Investments purchased (4,241,427) (3,451,488)Receivable for securities sold 31,167 (2,642)Accrued expenses 5,894 6,823 Payable for securities purchased 77,650 7,024

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES (2,671,727) (3,164,879)

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIESPremium payments 5,115,783 3,552,697 Amounts paid on withdrawals (2,382,898) (390,488)

NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES 2,732,885 3,162,209

Increase (Decrease) in cash/bank overdraft 61,158 (2,670)

Cash (bank overdraft), beginning of period 70,175 527

CASH (BANK OVERDRAFT), END OF PERIOD 131,333 (2,143)

STATEMENT OF CASH FLOWS – unauditedSTATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS – unaudited

Six-month Periods Ended June 30




SCHEDULE OF INVESTMENT PORTFOLIO – unauditedas at June 30, 2016

Number of Units

Cost

$

Fair Value

$

INVESTMENT FUNDS (99.5%)BlackRock Active Canadian Equity DC Fund 10,424 317,564 308,574 BlackRock CDN US Equity Index Fund, Class D 39,002 664,387 686,620 Desjardins Enhanced Bond Fund, I-Class 238,508 2,685,090 2,759,541 Desjardins Overseas Equity Growth Fund, I-Class 18,984 353,287 334,504 Desjardins Overseas Equity Value Fund, I-Class 25,170 357,047 348,125 DGIA Canadian Bond Fund 610,078 6,257,646 6,401,087 Fidelity True North® Fund, Series O 6,710 301,741 304,568 Franklin Bissett Canadian Equity Fund, Series O 2,278 296,362 307,436

TOTAL INVESTMENTS 11,233,124 11,450,455

OTHER NET ASSETS (0.5%) 52,516

NET ASSETS (100%) 11,502,971


TOP FIVE HOLDINGS OF THE UNDERLYING FUNDS – unaudited

Security Name Percentage of Portfolio

DGIA CANADIAN BOND FUND 55.6%Canada Housing Trust, 2 .00%, December 15, 2019 4 .6%NHA MBS Merrill Lynch, 1 .35%, May 1, 2020 3 .9%Province of Ontario, 2 .10%, September 8, 2019 3 .3%Province of Ontario, 2 .60%, June 2, 2025 3 .2%Government of Canada, 1 .50%, June 1, 2026 2 .8%

DESJARDINS ENHANCED BOND FUND 23.9%Government of Canada, 2 .25%, June 1, 2025 8 .4%Province of Quebec, 3 .50%, December 1, 2048 2 .7%Desjardins IBrix Global Bond Fund 2 .5%Province of British Columbia, 2 .70%, December 18, 2022 2 .4%Canada Housing Trust, 2 .25%, December 15, 2025 2 .4%

BLACKROCK CDN US EQUITY INDEX FUND 5.9%Apple 2 .9%Microsoft Corporation 2 .2%Exxon Mobil Corporation 2 .1%Johnson & Johnson 1 .8%General Electric Company 1 .6%

DESJARDINS OVERSEAS EQUITY VALUE FUND 3.0%Novartis AG 4 .2%Roche Holding AG 4 .1%British American Tobacco 3 .6%Nestlé 3 .6%Japan Tobacco 3 .5%

DFS GIF – CONSERVATIVE (cont.)



DESJARDINS OVERSEAS EQUITY GROWTH FUND 2.9%Tencent Holdings 5 .2%Inditex 5 .0%Baidu, ADR 4 .8%AIA Group 4 .2%Softbank Corporation 3 .8%

BLACKROCK ACTIVE CANADIAN EQUITY DC FUND 2.7%Royal Bank of Canada 6 .7%Toronto-Dominion Bank 5 .4%Scotiabank 5 .2%BCE 3 .9%Canadian National Railway Company 3 .6%

FRANKLIN BISSETT CANADIAN EQUITY FUND 2.7%Brookfield Asset Management 5 .3%Canadian National Railway Company 4 .9%Toronto-Dominion Bank 4 .7%Canadian Imperial Bank of Commerce 4 .6%Royal Bank of Canada 4 .2%

FIDELITY TRUE NORTH® FUND 2.6%Toronto-Dominion Bank 7 .4%Loblaw Companies 4 .2%Rogers Communications 3 .8%Canadian National Railway Company 3 .3%Suncor Energy 3 .0%

TOP FIVE HOLDINGS OF THE UNDERLYING FUNDS – unaudited (cont.)


NOTES TO THE FINANCIAL STATEMENTS – SPECIFIC INFORMATION – unaudited

STRATEGY IN USING FINANCIAL INSTRUMENTS

Investment ObjectiveTo generate a consistent flow of income with an emphasis on the preservation of capital by investing in a number of different fixed income and equity underlying funds .

Investment StrategyTo invest in a wide array of underlying funds managed by using a multi-manager approach provided by acclaimed fund managers and sub-advisors .

FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE (Note 7)

Hierarchy of Financial Instruments Measured at Fair Value The following tables categorize the Fund’s financial assets fair value measurement according to a three-level hierarchy . The methodology used for valuing securities is not necessarily an indication of the risk associated with investing in those securities . Fair value measurement is described in the “Significant Accounting Policies” section of Note 2 .

Investment Measured at Fair Value at the End of the Period, within the Following Levels:

June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLInvestment Funds 4,054,174 7,396,281 — 11,450,455 TOTAL 4,054,174 7,396,281 — 11,450,455

December 31, 2015 Level 1 $

Level 2 $

Level 3 $

Total $


Transfers between Levels 1 and 2During the periods ended June 30, 2016 and December 31, 2015, there were no transfers of securities between Levels 1 and 2 .

Investment Entities (Note 2)The total value of index-based investments, mortgage-backed securities, asset-backed securities, investment funds (including limited partnerships) and master asset vehicles (included in the bonds) in the table “Investment Fair Value Measurement within the Levels” also represent the fair value of the investments in structured entities .

FINANCIAL INSTRUMENTS RISKS (Note 7)

Underlying Funds Risk ManagementMonthly, the investment strategy team compares the Fund’s performance to similar funds as well as to the related benchmarks . Quarterly, this team makes an analysis of the Fund’s performance . This analysis includes among others a review of the securities having obtained a greater or lower performance than forecasts, an evaluation of the strategies used as well as a complete analysis of the sector . It also ensures the compliance with the Fund’s investment policies . Furthermore, it examines thoughtfully any change within the organization, such as the recruitment, the departure of key staff or any structure modification . Annually, this team reviews the practices and processes used by the Fund’s managers through an exhaustive questionnaire and periodic meetings .

Currency RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in underlying funds which may be exposed to currency risk . As a result, the Fund may be exposed to currency risk related to the current underlying funds . Detailed disclosure about the currency risk on the underlying funds can be obtained from Desjardins Financial Security (see Note 7) .

Interest Rate RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in underlying funds which may be exposed to interest rate risk . As a result, the Fund may be exposed to interest rate risk related to the current underlying funds . Detailed disclosure about the interest rate risk on the underlying funds can be obtained from Desjardins Financial Security (see Note 7) .

DFS GIF – CONSERVATIVE (cont.)



Concentration RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in underlying funds which are exposed to concentration risk . As a result, the Fund is exposed to concentration risk related to the current underlying funds . Detailed disclosure about the concentration risk on the underlying funds can be obtained from Desjardins Financial Security (see Note 7) .

Price RiskThe majority of the Net Assets Attributable to Contract Owners are invested in underlying funds which are exposed to price risk . As a result, the Fund is exposed to price risk related to the current underlying funds . Detailed disclosure about the price risk on the underlying funds can be obtained from Desjardins Financial Security (see Note 7) .The Manager’s best estimate of the impact on Net Assets Attributable to Contract Owners as a result of a reasonably possible change in benchmarks, with all other variables held constant, is as follows:

BenchmarksChange in Price

%

Impact on Net Assets Attributable to Contract Owners

June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (80%) 1 .00 92,024 67,586S&P/TSX (8%) 3 .00 27,607 20,276S&P 500 (6%) 3 .00 20,705 15,207MSCI EAFE Net (6%) 3 .00 20,705 15,207

When there is more than one benchmark, the effect of each benchmark must be considered individually, as each benchmark might fluctuate independently from the others .In practice, actual trading results may differ from these sensitivity analyses and the differences could be significant .

Credit RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in underlying funds which may be exposed to credit risk . As a result, the Fund may be exposed to credit risk related to the current underlying funds . Detailed disclosure about the credit risk on the underlying funds can be obtained from Desjardins Financial Security (see Note 7) .

Liquidity RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in underlying funds which are exposed to liquidity risk . As a result, the Fund is exposed to liquidity risk related to the current underlying funds . Detailed disclosure about the liquidity risk on the underlying funds can be obtained from Desjardins Financial Security (see Note 7) .For further information on maturities of financial liabilities and liquidity risk management of the Fund, please refer to Note 7 “Financial Instruments Disclosures” .


June 30 2016

$

December 31 2015


or loss (FVTPL) 18,371,591 13,580,031 Premiums receivable 356,874 18,755 Receivable for securities sold 134,512 —

19,343,595 14,052,759

LIABILITIESCurrent LiabilitiesAccrued expenses 36,904 27,384 Withdrawals payable 279,171 7,033 Payable for securities purchased 89,261 77,584

405,336 112,001




2016$

2015$


Net realized gain (loss) on investments 6,700 18,117 Net unrealized gain (loss) on investments 319,640 32,881

549,788 163,711


198,205 94,221 Withholding taxes 4,547 1,845

202,752 96,066







Average Number of Units 2,715,803 1,351,439




DFS GIF – MODERATE







2016$

2015$



PremiumsSeries 5* 444,875 —Series 6 4,483,652 4,441,780 Series 7 1,372,889 967

6,301,416 4,442,747

WithdrawalsSeries 5* (27,813) —Series 6 (1,421,326) (586,027)Series 7 (201,812) (2)

(1,650,951) (586,029)



2016$

2015$



Adjustments for:Net realized gain (loss) (6,700) (18,117)Net unrealized gain (loss) (319,640) (32,881)


Investments purchased (5,805,561) (4,232,091)Receivable for securities sold (134,512) (5,949)Accrued expenses 9,520 8,296 Payable for securities purchased 11,677 87,808




Increase (Decrease) in cash/bank overdraft 26,645 33,795

Cash (bank overdraft), beginning of period 453,973 29,728

CASH (BANK OVERDRAFT), END OF PERIOD 480,618 63,523






Number of Units

Cost

$

Fair Value

$

INVESTMENT FUNDS (97.0%)BlackRock Active Canadian Equity DC Fund 29,635 914,581 877,287 BlackRock CDN US Equity Index Fund, Class D 110,522 1,870,749 1,945,699 Desjardins Enhanced Bond Fund, I-Class 310,356 3,494,816 3,590,819 Desjardins Overseas Equity Growth Fund, I-Class 53,101 992,884 935,643 Desjardins Overseas Equity Value Fund, I-Class 70,503 1,009,673 975,130 DGIA Canadian Bond Fund 793,808 8,134,144 8,328,828 Fidelity True North® Fund, Series O 18,817 848,638 854,143 Franklin Bissett Canadian Equity Fund, Series O 6,402 835,922 864,042



NET ASSETS (100%) 18,938,259








DFS GIF – MODERATE (cont.)




Investment ObjectiveTo generate income while leaving room for some capital appreciation by investing in a number of different fixed income and equity underlying funds .





June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $





Underlying Funds Risk ManagementMonthly, the investment strategy team compares the Fund’s performance to similar funds as well as to the related benchmarks .Quarterly, this team makes an analysis of the Fund’s performance . This analysis includes among others a review of the securities having obtained a greater or lower performance than forecasts, an evaluation of the strategies used as well as a complete analysis of the sector . It also ensures the compliance with the Fund’s investment policies . Furthermore, it examines thoughtfully any change within the organization, such as the recruitment, the departure of key staff or any structure modification .Annually, this team reviews the practices and processes used by the Fund’s managers through an exhaustive questionnaire and periodic meetings .



DFS GIF – MODERATE (cont.)






%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (65%) 1 .00 123,099 90,615S&P/TSX (14%) 3 .00 79,541 58,551S&P 500 (10 .5%) 3 .00 59,656 43,913MSCI EAFE Net (10 .5%) 3 .00 59,656 43,913





June 30 2016

$

December 31 2015


or loss (FVTPL) 41,256,888 30,993,618 Premiums receivable 175,606 59,798 Receivable for securities sold 36,889 3,797

41,766,208 31,387,129

LIABILITIESCurrent LiabilitiesAccrued expenses 83,746 62,246 Withdrawals payable 46,386 19,248 Payable for securities purchased 87,823 25,847

217,955 107,341




2016$

2015$


Net realized gain (loss) on investments (3,946) 22,566 Net unrealized gain (loss) on investments 582,370 114,685

1,084,276 335,928



461,241 175,327












DFS GIF – BALANCED






2016$

2015$



PremiumsSeries 5* 394,489 —Series 6 9,955,158 6,765,443 Series 7 653,010 605,227

11,002,657 7,370,670


(1,357,227) (497,154)



2016$

2015$



Adjustments for:Net realized gain (loss) 3,946 (22,566)Net unrealized gain (loss) (582,370) (114,685)


Investments purchased (11,472,674) (7,271,075)Receivable for securities sold (33,092) —Accrued expenses 21,500 15,519 Payable for securities purchased 61,976 39,670




Increase (Decrease) in cash/bank overdraft (33,091) 24,253








Number of Units

Cost

$

Fair Value

$

INVESTMENT FUNDS (99.3%)BlackRock Active Canadian Equity DC Fund 94,222 2,877,694 2,789,247 BlackRock CDN US Equity Index Fund, Class D 350,995 6,015,398 6,179,149 Desjardins Enhanced Bond Fund, I-Class 536,931 6,040,684 6,212,292 Desjardins Overseas Equity Growth Fund, I-Class 170,835 3,212,512 3,010,112 Desjardins Overseas Equity Value Fund, I-Class 226,752 3,248,235 3,136,217 DGIA Canadian Bond Fund 1,373,384 14,065,954 14,409,875 Fidelity True North® Fund, Series O 60,461 2,734,643 2,744,426 Franklin Bissett Canadian Equity Fund, Series O 20,566 2,669,009 2,775,570



NET ASSETS (100%) 41,548,253








DFS GIF – BALANCED (cont.)




Investment ObjectiveTo provide investors with an attractive balance of current income and capital appreciation by investing in a number of different fixed income and equity underlying funds .



Hierarchy of Financial Instruments at Fair Value MeasurementThe following tables categorize the Fund’s financial assets fair value measurement according to a three-level hierarchy . The methodology used for valuing securities is not necessarily an indication of the risk associated with investing in those securities . Fair value measurement is described in the “Significant Accounting Policies” section of Note 2 .


June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $





Underlying Funds Risk ManagementMonthly, the investment strategy team compares the Funds’ performance to similar funds as well as to the related benchmarks .Quarterly, this team makes an analysis of the Funds’ performance . This analysis includes among others a review of the securities having obtained a greater or lower performance than forecasts, an evaluation of the strategies used as well as a complete analysis of the sector . It also ensures the compliance with the Funds’ investment policies . Furthermore, it examines thoughtfully any change within the organization, such as the recruitment, the departure of key staff or any structure modification .Annually, this team reviews the practices and processes used by the Funds’ managers through an exhaustive questionnaire and periodic meetings .



DFS GIF – BALANCED (cont.)




Price RiskThe majority of the Net Assets Attributable to Contract Owners are invested in underlying funds which are exposed to price risk . As a result, the Fund is exposed to price risk related to the current underlying funds . Detailed disclosure about the price risk on the underlying funds can be obtained from Desjardins Financial Security (see Note 7) .As at June 30, 2016 and December 31, 2015, the Manager’s best estimate of the impact on Net Assets Attributable to Contract Owners as a result of a reasonably possible change in benchmarks, with all other variables held constant, is as follows:


%


June 30, 2016 $


December 31, 2015 $






June 30 2016

$

December 31 2015

$ASSETSCurrent AssetsCash — 110,798 Investments at fair value through profit


25,212,243 19,093,850

LIABILITIESCurrent LiabilitiesBank overdraft 30,139 —Accrued expenses 50,480 39,847 Withdrawals payable 40,876 18,356 Payable for securities purchased 67,312 36,091

188,807 94,294




2016$

2015$



569,633 199,041



294,911 106,221











DFS GIF – GROWTH







2016$

2015$



PremiumsSeries 5* 1,628,191 —Series 6 6,052,189 5,300,251 Series 7 585,087 14,698

8,265,467 5,314,949


(2,516,309) (404,228)



2016$

2015$





Investments purchased (7,560,614) (5,108,966)Receivable for securities sold (140,935) —Accrued expenses 10,633 12,373 Payable for securities purchased 31,221 9,082




Increase (Decrease) in cash/bank overdraft (140,937) (5,325)


CASH (BANK OVERDRAFT), END OF PERIOD (30,139) 16,395






Number of Units

Cost

$

Fair Value

$

INVESTMENT FUNDS (99.3%)BlackRock Active Canadian Equity DC Fund 73,603 2,240,157 2,178,870 BlackRock CDN US Equity Index Fund, Class D 274,089 4,713,796 4,825,242 Desjardins Enhanced Bond Fund, I-Class 226,755 2,550,747 2,623,557 Desjardins Overseas Equity Growth Fund, I-Class 133,742 2,529,060 2,356,532 Desjardins Overseas Equity Value Fund, I-Class 177,644 2,550,632 2,457,000 DGIA Canadian Bond Fund 579,947 5,941,430 6,084,944 Fidelity True North® Fund, Series O 47,391 2,139,410 2,151,173 Franklin Bissett Canadian Equity Fund, Series O 16,128 2,086,467 2,176,559



NET ASSETS (100%) 25,023,436








DFS GIF – GROWTH (cont.)




Investment ObjectiveTo emphasize appreciation of capital while still generating some income by investing in a number of different fixed income and equity underlying funds .



Hierarchy of Financial Instruments Measured at Fair ValueThe following tables categorize the Fund’s financial assets fair value measurement according to a three-level hierarchy . The methodology used for valuing securities is not necessarily an indication of the risk associated with investing in those securities . Fair value measurement is described in the “Significant Accounting Policies” section of Note 2 .


June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $








DFS GIF – GROWTH (cont.)




Price RiskThe majority of the Net Assets Attributable to Contract Owners are invested in underlying funds which are exposed to price risk . As a result, the Fund is exposed to price risk related to the current underlying funds . Detailed disclosure about the price risk on the underlying funds can be obtained from Desjardins Financial Security (see Note 7) .As at June 30, 2016 and December 31, 2015, the Manager’s best estimate of the impact on Net Assets Attributable to Contract Owners as a result of a reasonably possible change in benchmarks, with all other variables held constant, is as follows:


%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (35%) 1 .00 87,582 66,498S&P/TSX (26%) 3 .00 195,183 148,197S&P 500 (19 .5%) 3 .00 146,387 111,147MSCI EAFE Net (19 .5%) 3 .00 146,387 111,147





June 30 2016

$

December 31 2015


or loss (FVTPL) 2,289,228 1,887,056 Premiums receivable 29,907 1,540

2,324,761 1,894,285

LIABILITIESCurrent LiabilitiesAccrued expenses 5,000 4,251 Withdrawals payable 383 275 Payable for securities purchased 19,787 1,174

25,170 5,700




2016$

2015$



46,368 49,809


28,696 17,164 Withholding taxes 1,279 715

29,975 17,879









from Operations 64 920 - per unit 0.02 0 .24



DFS GIF – MAXIMUM GROWTH






2016$

2015$



PremiumsSeries 5* 119,812 —Series 6 544,084 541,167 Series 7 — —

663,896 541,167

WithdrawalsSeries 5* (5,979) —Series 6 (263,304) (66,370)Series 7 — —

(269,283) (66,370)



2016$

2015$




Proceeds from sale/maturity of investments 358,025 74,952

Investments purchased (742,441) (583,991)Accrued expenses 749 1,220 Payable for securities purchased 18,613 18,335

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES (366,417) (489,856)

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIESPremium payments 635,529 520,633 Amounts paid on withdrawals (269,175) (12,506)

NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES 366,354 508,127

Increase (Decrease) in cash/bank overdraft (63) 18,271








Number of Units

Cost

$

Fair Value

$

INVESTMENT FUNDS (99.5%)BlackRock Active Canadian Equity DC Fund 8,301 258,073 245,740 BlackRock CDN US Equity Index Fund, Class D 30,914 510,419 544,228 Desjardins Enhanced Bond Fund, I-Class 11,962 134,691 138,396 Desjardins Overseas Equity Growth Fund, I-Class 15,228 284,249 268,322 Desjardins Overseas Equity Value Fund, I-Class 20,200 294,771 279,380 DGIA Canadian Bond Fund 30,589 312,592 320,949 Fidelity True North® Fund, Series O 5,389 240,870 244,630 Franklin Bissett Canadian Equity Fund, Series O 1,835 238,494 247,583



NET ASSETS (100%) 2,299,591








DFS GIF – MAXIMUM GROWTH (cont.)




Investment ObjectiveTo maximize the appreciation of capital while still generating some income by investing in a number of different fixed income and equity underlying funds .





June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLInvestment Funds 1,178 311 1,110,917 — 2,289,228 TOTAL 1,178,311 1,110,917 — 2,289,228


Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLInvestment Funds 963,301 923,755 — 1,887,056 TOTAL 963,301 923,755 — 1,887,056







DFS GIF – MAXIMUM GROWTH (cont.)






%


June 30, 2016 $


December 31, 2015 $






Individual Funds


June 30 2016

$

December 31 2015



36,223,936 35,756,826 LIABILITIESCurrent LiabilitiesBank overdraft 186,149 —Accrued expenses 37,665 38,465 Withdrawals payable 334,813 584,009 Payable for securities purchased 23,658 17,606

582,285 640,080 NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS 35,641,651 35,116,746

NET ASSETS PER UNITSeries 1 6.60 6 .61 Series 3 6.61 6 .62 Series 5 6.80 6 .80 Series 6 5.02 5 .01 Series 7 5.08 5 .06 Series IGP 9.94 9 .96

2016$

2015$

INCOMEInterest for attribution purposes 369,017 380,260 Changes in fair value:

Net realized gain (loss) on investments 201,045 173,668 Net unrealized gain (loss) on investments (331,079) (319,452)

238,983 234,476 EXPENSESManagement fees and guarantee charge 154,894 130,763 Operating expenses 76,402 70,973

231,296 201,736


DATA PER SERIESSERIES 1Increase (Decrease) in Net Assets

from Operations (758) (216)- per unit (0.01) —

Average Number of Units 67,788 82,215 SERIES 3Increase (Decrease) in Net Assets

from Operations (5,055) (1,281)- per unit (0.01) —


from Operations (1,497) 23,883 - per unit — 0 .01

Average Number of Units 2,960,090 2,899,706 SERIES 6Increase (Decrease) in Net Assets


Average Number of Units 1,814,192 760,016 SERIES 7Increase (Decrease) in Net Assets


Average Number of Units 246,425 187,461 SERIES IGPIncrease (Decrease) in Net Assets

from Operations (2,567) 388 - per unit (0.01) —



Income

DFS GIF – MONEY MARKET

STATEMENT OF FINANCIAL POSITION – unauditedAs at

STATEMENT OF COMPREHENSIVE INCOME – unauditedSix-month Periods Ended June 30



2016$

2015$



PremiumsSeries 1 49,754 600 Series 3 567,983 461,998 Series 5 4,492,593 4,196,513 Series 6 4,728,020 4,704,081 Series 7 1,570,502 989,659 Series IGP 311,038 189,807

11,719,890 10,542,658

WithdrawalsSeries 1 (46,020) (69,385)Series 3 (874,358) (330,712)Series 5 (5,691,659) (5,792,309)Series 6 (3,798,929) (1,524,245)Series 7 (593,751) (982,399)Series IGP (197,955) (360,851)

(11,202,672) (9,059,901)


2016$

2015$



Adjustments for:Net realized gain (loss) (201,045) (173,668)Net unrealized gain (loss) 331,079 319,452

Proceeds from sale/maturity of investments 7,495,448 4,490,006

Investments purchased (7,703,675) (5,986,246)Receivable for securities sold — (20,821)Accrued expenses (800) 1,655 Payable for securities purchased 6,052 (112,980)

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES (65,254) (1,449,862)

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIESPremium payments 11,295,675 10,281,423 Amounts paid on withdrawals (11,451,868) (9,001,468)

NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES (156,193) 1,279,955



CASH (BANK OVERDRAFT), END OF PERIOD (186,149) (47,740)






Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (99.1%)DGIA Money Market Fund 3,662,536 34,559,026 35,329,794



NET ASSETS (100%) 35,641,651


TOP 25 HOLDINGS OF THE UNDERLYING FUND – unaudited


Daimler Canada Finance, 2 .28%, February 17, 2017 9 .3%Manufacturers Life Insurance Company, Floating Rate, November 18, 2021 8 .9%Lower Mattagami Energy Limited Partnership, Notes, July 14, 2016 6 .7%Toronto-Dominion Bank, Notes, May 4, 2017 5 .6%Scotiabank, 2 .74%, December 1, 2016 5 .4%Royal Bank of Canada, 2 .58%, April 13, 2017 5 .3%Industrial Alliance, 4 .75%, December 14, 2021 5 .2%Bank of Montreal, Floating Rate, March 29, 2018 4 .9%BMW Canada, Floating Rate, June 14, 2019 4 .5%Canadian Imperial Bank of Commerce, Floating Rate, August 8, 2016 4 .0%Scotiabank, 4,10%, June 8, 2017 3 .7%Gaz Métro, Notes, August 3, 2016 3 .6%Province of Nova Scotia, Stripped, June 1, 2017 2 .8%Bank of Montréal, 2 .39%, July 12, 2017 2 .7%Lower Mattagami Energy Limited Partnership, Notes, July 21, 2016 2 .7%Gaz Métro, Notes, August 17, 2016 2 .7%Hydro-Québec, Stripped, May 22, 2017 2 .7%Newfoundland & Labrador Treasury Bills, September 15, 2016 2 .2%Toyota Credit Canada, Floating Rate, February 25, 2019 1 .8%Royal Bank of Canada, Notes, September 8, 2016 1 .8%Toronto-Dominion Bank, Notes, February 10, 2017 1 .8%Province of Ontario, Stripped, August 7, 2017 1 .7%Toyota Credit Canada, Notes, January 5, 2017 1 .0%BMW Canada, 2 .39%, November 27, 2017 0 .9%Canadian Imperial Bank of Commerce, 2 .65%, November 8, 2016 0 .9%

Income

DFS GIF – MONEY MARKET (cont.)


NOTES TO THE FINANCIAL STATEMENTS – SPECIFIC INFORMATION – unauditedas at June 30, 2016


Investment ObjectiveTo provide a higher level of interest income than can normally be obtained from savings accounts, combined with a high level of liquidity and safety of capital .

Investment StrategyTo invest primarily in Canadian government treasury bills and in bankers’ acceptances, which have a maximum maturity of 12 months . The Fund’s modified duration may not exceed 180 days .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLInvestment Funds — 35,329,794 — 35,329,794 TOTAL — 35,329,794 — 35,329,794


Level 2 $

Level 3 $

Total $





Underlying Fund Risk ManagementMonthly, the investment strategy team compares the Fund’s performance to similar funds as well as to the related benchmarks .Quarterly, this team makes an analysis of the Fund’s performance . This analysis includes among others a review of the securities having obtained a greater or lower performance than forecasts, an evaluation of the strategies used as well as a complete analysis of the sector . It also ensures the compliance with the Fund’s investment policies . Furthermore, it examines thoughtfully any change within the organization, such as the recruitment, the departure of key staff or any structure modification .Annually, this team reviews the practices and processes used by the Fund’s managers through an exhaustive questionnaire and periodic meetings .

Currency RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which may be exposed to currency risk . As a result, the Fund may be exposed to currency risk related to the current underlying fund . Detailed disclosure about the currency risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .

Interest Rate RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which may be exposed to interest rate risk . As a result, the Fund may be exposed to interest rate risk related to the current underlying fund . Detailed disclosure about the interest rate risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .



Concentration RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which is exposed to concentration risk . As a result, the Fund is exposed to concentration risk related to the current underlying fund . Detailed disclosure about the concentration risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .

Price RiskThe majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which is exposed to price risk . As a result, the Fund is exposed to price risk related to the current underlying fund . Detailed disclosure about the price risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .The Manager’s best estimate of the impact on Net Assets Attributable to Contract Owners as a result of a reasonably possible change in benchmarks, with all other variables held constant, is as follows:


%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada 91 Day Treasury Bills 0 .25 89,104 87,792


Credit RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which may be exposed to credit risk . As a result, the Fund may be exposed to credit risk related to the current underlying fund . Detailed disclosure about the credit risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .

Liquidity RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which is exposed to liquidity risk . As a result, the Fund is exposed to liquidity risk related to the current underlying fund . Detailed disclosure about the liquidity risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .For further information on maturities of financial liabilities and liquidity risk management of the Fund, please refer to Note 7 “Financial Instruments Disclosures” .

Income

DFS GIF – MONEY MARKET (cont.)


June 30 2016

$

December 31 2015

$ASSETSCurrent AssetsCash 28,641 —Investments at fair value through profit

or loss (FVTPL) 93,252,290 95,095,603 Investments at fair value through profit

or loss (FVTPL) pledged as collateral 11,540,632 12,171,098 Premiums receivable 98,442 49,071 Receivable for securities sold 2,458,224 —Cash guarantee received for repurchase

transactions 9,960,959 12,107,884 Interest, dividends and other receivables 444,088 521,404

117,783,276 119,945,060 LIABILITIESCurrent LiabilitiesBank overdraft — 10,221 Accrued expenses 177,358 182,647 Withdrawals payable 374,984 287,615 Payable for securities purchased 2,125,454 —Commitments related to repurchase

transactions 9,960,959 12,107,884 12,638,755 12,588,367


NET ASSETS PER UNITSeries 1 10.42 10 .15 Series 3 11.00 10 .69 Series 5 11.59 11 .24 Series 6 5.47 5 .30 Series 7 5.53 5 .34

2016$

2015$

INCOMEInterest for attribution purposes 1,625,831 1,694,341 Revenue from securities lending and

repurchase transactions 10,232 10,058 Changes in fair value:

Net realized gain (loss) on investments 1,042,667 2,361,082 Net unrealized gain (loss) on investments 1,624,306 (1,594,927)

4,303,036 2,470,554 EXPENSESManagement fees and guarantee charge 720,005 738,237 Operating expenses 352,634 373,634

1,072,639 1,111,871

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 3,230,397 1,358,683






from Operations 2,628,953 1,235,823 - per unit 0.35 0 .15




from Operations 9,951 550 - per unit 0.18 0 .03



Income

DFS GIF – INCOME – FIERA CAPITAL

STATEMENT OF FINANCIAL POSITION – unauditedAs at Six-month Periods Ended June 30




2016$

2015$

NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS, BEGINNING OF PERIOD 107,356,693 109,764,083Increase (Decrease) in Net Assets

from operations attributable to contract owners 3,230,397 1,358,683

PremiumsSeries 1 4,010 43,080 Series 3 353,252 402,633 Series 5 4,057,383 3,201,716 Series 6 2,391,294 1,726,992 Series 7 31,000 93,839

6,836,939 5,468,260

WithdrawalsSeries 1 (529,346) (180,108)Series 3 (1,489,810) (1,157,094)Series 5 (9,677,059) (9,137,035)Series 6 (532,022) (344,424)Series 7 (51,271) (693)

(12,279,508) (10,819,354)


2016$

2015$



Adjustments for:Net realized gain (loss) (1,042,667) (2,361,082)Net unrealized gain (loss) (1,624,306) 1,594,927


Investments purchased (137,814,915) (118,639,939)Receivable for securities sold (2,458,224) (6,084,051)Cash guarantee received for

repurchase transactions 2,146,925 12,535,080 Interest, dividends and other

receivables 77,316 124,233 Accrued expenses (5,289) (7,512)Commitments related to repurchase

transactions (2,146,925) (12,535,080)Payable for securities purchased 2,125,454 3,556,398

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 5,443,510 5,058,682


NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES (5,404,571) (5,130,892)

Effect of exchange rate changes on foreign cash (77) 74


Cash (bank overdraft), beginning of period (10,221) (15,642)


SUPPLEMENTAL INFORMATION ON CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES

Interest received 1,609,261 1,818,573 Interest paid 17 —




Income

DFS GIF – INCOME – FIERA CAPITAL (cont.)



Par Fair Value Cost Value $ $BONDS (89.2%)

Canadian Bonds (89.1%)

Government of Canada (16.4%))Broadcast Center Trust 7 .530%, 2027-05-01 CAD 180,081 177,692 241,654Gouvernement du Canada 0 .250%, 2018-05-01* CAD 5,435,000 5,406,489 5,408,691 2 .250%, 2025-06-01* CAD 52,000 56,622 57,787 Series E679, 1 .500%, 2026-06-01* CAD 8,301,000 8,586,350 8,643,298 Series WL43, 5 .750%, 2029-06-01* CAD 109,000 161,756 165,274PSP Capital Series 7, 3 .290%, 2024-04-04 CAD 345,000 330,135 383,081 Royal Office Finance Series A, 5 .209%, 2032-11-12 CAD 1,860,402 1,687,255 2,371,157

16,406,299 17,270,942

Provincial Governments and Crown Corporations (33.6%)New Brunswick (F-M) Project Company 6 .470%, 2027-11-30 CAD 460,108 481,950 586,766 Ontario Infrastructure 4 .700%, 2037-06-01 CAD 80,000 71,858 99,522Ontario School Boards Financing Corporation Series 00A1, 7 .200%, 2025-06-09 CAD 2,441,490 2,605,834 3,076,337 Series 01A3, 6 .550%, 2026-10-19 CAD 1,543 1,581 1,922 Private Placement, Series 06A1, 5 .070%, 2031-04-18 CAD 517,773 464,506 610,125 Ornge Issuer Trust 5 .727%, 2034-06-11 CAD 269,139 246,428 329,028 Province of Alberta 3 .900%, 2033-12-01 CAD 436,000 411,978 500,949 3 .300%, 2046-12-01 CAD 2,594,000 2,601,832 2,802,533 Province of British Columbia 3 .200%, 2044-06-18 CAD 640,000 565,375 705,866 Province of Newfoundland and Labrador Series 6Z, 3 .000%, 2026-06-02 CAD 765,000 764,113 800,623 Province of Ontario 3 .150%, 2022-06-02 CAD 1,694,000 1,721,602 1,863,771 2 .850%, 2023-06-02 CAD 7,544,000 6,809,058 8,190,777 3 .500%, 2024-06-02 CAD 3,625,000 3,612,133 4,111,102 2 .600%, 2025-06-02 CAD 919,000 949,914 977,189 2 .900%, 2046-12-02* CAD 3,498,000 3,433,530 3,613,096 2 .800%, 2048-06-02 CAD 182,000 180,893 184,617 Province of Québec 3 .500%, 2022-12-01 CAD 190,000 208,282 213,329 2 .750%, 2025-09-01 CAD 933,000 986,001 1,001,852 5 .750%, 2036-12-01 CAD 296,000 407,829 433,452 4 .250%, 2043-12-01 CAD 796,000 777,244 1,014,320 3 .500%, 2045-12-01 CAD 2,197,000 2,253,573 2,504,381 3 .500%, 2048-12-01* CAD 276,000 311,138 318,168 TCHC Issuer Trust 4 .877%, 2037-05-11 CAD 287,000 238,639 361,789 Series B, 5 .395%, 2040-02-22 CAD 690,000 637,841 946,613

30,743,132 35,248,127

*Securities pledged as collateral, in part or in whole, through the securities lending program.

FOR EASE OF COMPREHENSION TO THE READER, FOR THE DFS GIF – INCOME – FIERA CAPITAL, THE ENTIRE PORTFOLIO OF SECURITIES IN THE SCHEDULE OF INVESTMENT PORTFOLIO AS AT JUNE 30, 2016, HAS NOT BEEN DISCLOSED. INSTEAD, THE MAJOR CATEGORIES OF ASSETS ARE LISTED ALONG WITH THE PERCENTAGES THAT EACH OF THESE CATEGORIES HOLD. THE TOTAL COSTS, FAIR VALUES, NUMBER OF UNITS, TOTAL INVESTMENTS AND NET ASSETS ARE ALSO LISTED.



Par Fair Value Cost Value $ $Corporations (39.1%)

Bank of Montreal 2 .390%, 2017-07-12 CAD 33,000 31,161 33,443 2 .240%, 2017-12-11 CAD 529,000 502,045 536,959 3 .340%, (floating rate from 2020-12-08), 2025-12-08* CAD 775,000 774,713 787,656 3 .320%, (floating rate from 2021-06-01), 2026-06-01 CAD 1,064,000 1,063,851 1,076,918 Blackbird Infrastructure 407 General Partners 1 .713%, (floating rate from 2020-01-08), 2021-10-08 CAD 229,000 227,216 229,217 Caisse centrale Desjardins 2 .443%, 2019-07-17 CAD 840,000 805,831 865,121 Canadian Imperial Bank of Commerce 2 .350%, 2017-10-18 CAD 2,743,000 2,621,107 2,784,277 2 .350%, 2019-06-24* CAD 56,000 53,675 57,620 3 .000%, (floating rate from 2019-10-28), 2024-10-28* CAD 88,000 88,208 88,343 3 .420%, (floating rate from 2021-01-26), 2026-01-26 CAD 762,000 764,687 776,080 Canadian Utilities 4 .543%, 2041-10-24 CAD 408,000 404,194 480,906 4 .722%, 2043-09-09 CAD 175,000 191,993 212,713 4 .085%, 2044-09-02 CAD 169,000 171,496 187,352 Capital City Link Series A, 4 .386%, 2046-03-31 CAD 847,000 759,585 910,025 Cominar Real Estate Investment Trust Series 9, 4 .164%, 2022-06-01 CAD 645,000 645,000 661,225 Series 10, 4 .247%, 2023-05-23 CAD 315,000 315,000 320,694 CSS (FSCC) Partnership 6 .915%, 2042-07-31 CAD 88,273 100,013 122,009 Enbridge 3 .940%, 2023-06-30* CAD 425,000 401,286 450,681 7 .220%, 2030-07-24 CAD 150,000 157,438 189,293 7 .200%, 2032-06-18 CAD 546,000 646,043 701,441 4 .570%, 2044-03-11 CAD 958,000 884,436 924,881 Grand Renewable Solar Series 1A, 3 .926%, 2035-01-31 CAD 286,000 286,000 294,718 Health Montréal Collective, Private Placement Series 144A, 6 .721%, 2049-09-30 CAD 1,370,000 1,575,576 1,886,529 Hospital Infrastructure Series A, 5 .439%, 2045-01-31 CAD 624,907 575,041 731,979 Integrated Team Solutions SJHC 5 .946%, 2042-11-30 CAD 200,676 185,483 254,646 Laurentian Bank of Canada 2 .750%, 2021-04-22 CAD 285,000 284,393 289,348 Melancthon Wolfe Wind 3 .834%, 2028-12-31 CAD 308,502 308,539 312,798 North West Redwater Partnership Series A, 3 .200%, 2024-07-22 CAD 505,000 484,491 526,987 3 .200%, 2026-04-24 CAD 263,000 262,440 271,038 Series F, 4 .250%, 2029-06-01 CAD 310,000 309,138 336,360 Northland Power Solar Finance Limited Partnership Series A, 4 .958%, 2032-12-31 CAD 387,671 369,540 450,330


Income




Par Fair Value Cost Value $ $Corporations (cont.)

Plenary Properties 6 .288%, 2044-01-31 CAD 834,645 809,958 1,127,261 Reliance Series 2, 5 .187%, 2019-03-15 CAD 394,000 371,084 414,945 Royal Bank of Canada 2 .364%, 2017-09-21 CAD 802,000 757,861 813,741 2 .260%, 2018-03-12* CAD 515,000 486,798 523,599 2 .820%, 2018-07-12 CAD 250,000 239,188 257,341 1 .400%, 2019-04-26 CAD 1,095,000 1,094,650 1,099,029 2 .860%, 2021-03-04 CAD 8,000 7,670 8,449 2 .030%, 2021-03-15 CAD 865,000 864,671 881,562 3 .040%, (floating rate from 2019-07-17), 2024-07-17 CAD 165,000 158,228 165,741 2 .990%, (floating rate from 2019-12-06), 2024-12-06 CAD 1,070,000 1,008,613 1,102,115 2 .480%, (floating rate from 2020-06-04), 2025-06-04 CAD 825,000 824,843 811,120 3 .310%, (floating rate from 2021-01-20), 2026-01-20 CAD 55,000 56,052 55,730 Scotiabank 2 .370%, 2018-01-11* CAD 1,510,000 1,439,255 1,535,528 2 .242%, 2018-03-22 CAD 916,000 865,789 931,017 3 .270%, 2021-01-11 CAD 1,105,000 1,063,793 1,184,728 2 .898%, (floating rate from 2017-08-03), 2022-08-03 CAD 734,000 700,439 742,506 3 .367%, (floating rate from 2020-12-08), 2025-12-08* CAD 1,301,000 1,301,000 1,320,206 SGTP Highway Bypass Series A, 4 .105%, 2045-01-31 CAD 435,000 435,000 460,051 SNC-Lavalin Innisfree McGill Finance 6 .632%, 2044-06-30 CAD 401,344 423,672 540,195 Teranet Holdings 3 .646%, 2022-11-18 CAD 300,000 300,000 316,899 Teranet Income Fund 5 .754%, 2040-12-17 CAD 560,000 542,786 666,307 6 .100%, 2041-06-17 CAD 964,000 917,870 1,219,984 Toronto-Dominion Bank 2 .447%, 2019-04-02* CAD 805,000 772,170 829,261 2 .563%, 2020-06-24 CAD 250,000 239,817 260,257 1 .680%, 2021-06-08 CAD 270,000 269,897 272,194 3 .226%, 2024-07-24* CAD 468,000 451,175 512,060 2 .692%, (floating rate from 2020-06-24), 2025-06-24 CAD 456,000 456,000 452,527 2 .982%, (floating rate from 2020-09-30), 2025-09-30* CAD 386,000 386,000 386,955 4 .859%, 2031-03-04 CAD 296,000 299,927 324,070 4 .779%, (floating rate from 2016-12-14), 2105-12-14* CAD 1,430,000 1,434,452 1,448,510 5 .763%, (floating rate from 2017-12-18), 2106-12-18 CAD 1,456,000 1,517,281 1,535,170 TransCanada PipeLines 6 .890%, 2028-08-07 CAD 500,000 409,578 647,756 8 .050%, 2039-02-17 CAD 339,000 503,726 528,619

37,658,862 41,127,020

TOTAL CANADIAN BONDS 84,808,293 93,646,089

U.S. Bonds (0.1%)Sinai Health System Series A, 3 .527%, 2056-06-09 CAD 151,000 151,000 156,378

TOTAL BONDS 84,959,293 93,802,467




Number Fair of Units Cost Value $ $INVESTMENT FUND (8.7%)

Fiera Active Short Term Canadian Municipal Bond Fund 900,700 9,008,329 9,095,242

Par Value MONEY MARKET SECURITIES (0.6%)

Canada Treasury Bills 2016-08-25 CAD 520,000 519,525 519,525 2016-09-08 CAD 145,000 144,785 144,785

TOTAL MONEY MARKET SECURITIES 664,310 664,310

ASSET-BACKED SECURITIES (0.6%)CHIP Mortgage Trust 3 .663%, 2038-09-25 CAD 626,000 598,829 652,367

MORTGAGE-BACKED SECURITIES (0.6%)Merrill Lynch Financial Assets 4 .642%, 2016-10-12 CAD 670,000 267,556 290,509 Series 2007-CA22, Class A3, 4 .878%, 2017-04-12 CAD 250,000 229,000 254,611 Merrill Lynch Mortgage Loans 4 .711%, 2016-11-12 CAD 1,625,000 31,133 33,416

TOTAL MORTGAGE-BACKED SECURITIES 527,689 578,536

TOTAL INVESTMENTS (99.7%) 95,758,450 104,792,922


NET ASSETS (100%) 105,144,521


Income


TOP FIVE HOLDINGS OF THE UNDERLYING FUND – unaudited


FIERA ACTIVE SHORT TERM CANADIAN MUNICIPAL BOND FUND 8.7%Province of Quebec, 4 .50%, December 1, 2016 3 .2%City of Magog, 2 .00%, September 2, 2020 2 .7%City of Trois-Rivières, 2 .40%, October 21, 2020 2 .2%City of Belœil, 2 .00%, September 8, 2020 1 .7%City of Côte-Saint-Luc, 2 .00%, August 25, 2020 1 .7%




Investment ObjectiveTo provide above-average interest income with some potential for capital growth by investing primarily in bonds and other interest-bearing instruments of Canadian federal and provincial governments and investment-grade corporations .

Investment StrategyTo place emphasis primarily on medium and long-term maturities . Such maturities normally provide higher returns and better potential for capital gains but also higher variability of performance during periods of rapidly changing interest rates .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLBonds 48,243,919 45,558,548 — 93,802,467 Investment Funds — 9,095,242 — 9 095,242 Mortgage-Backed Securities — 578,536 — 578,536 Asset-Backed Securities — 652,367 — 652,367 Money Market Securities 664,310 — — 664,310 TOTAL 48,908,229 55,884,693 — 104,792,922


Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLBonds 47,190,319 48,296,032 — 95,486,351 Investment Funds — 8,938,322 — 8,938,322 Mortgage-Backed Securities — 1,305,466 — 1,305,466 Asset-Backed Securities — 657,388 — 657,388 Money Market Securities 879,174 — — 879,174 TOTAL 48,069,493 59,197,208 — 107,266,701




Currency RiskAs at June 30, 2016 and December 31, 2015, the majority of the Fund’s financial assets and liabilities are denominated in Canadian dollars . As a result, the Fund is not significantly exposed to currency risk .



Interest Rate RiskThe following table summarizes the Fund’s exposure to interest rate risk . It includes the Fund’s financial assets and liabilities at fair value, categorized by the earlier of contractual re-pricing or maturity dates . The table also illustrates the impact on the Net Assets Attributable to Contract Owners, had prevailing interest rates changed by 0 .25%, assuming a parallel shift in the yield curve, with all other variables held constant .

Less than 1 Year

$1 to 5 Years

$5 to 10 Years

$

Greater than 10 Years

$Total

$

Impact on Net Assets Attributable to

Contract Owners$

June 30, 2016 2,719,997 28,517,394 32,378,730 32,110,200 95,726,321 1,794,081 December 31, 2015 4,627,791 36,027,633 28,039,485 29,623,249 98,318,158 1,616,019

In practice, actual trading results may differ from these sensitivity analyses and the differences could be significant .

Concentration RiskThe following table summarizes the concentration risk, as a percentage of the Net Assets Attributable to Contract Owners:

MARKET SEGMENT June 30, 2016%

Canadian BondsCorporations 39 .1 Provincial Governments and Crown Corporations 33 .6 Government of Canada 16 .4

U .S . Bonds 0 .1 Income Investment Fund 8 .7 Money Market Securities 0 .6 Asset-Backed Securities 0 .6 Mortgage-Backed Securities 0 .6 Other Net Assets 0 .3 TOTAL 100

MARKET SEGMENT December 31, 2015%

BondsCorporations 40 .9 Provincial Governments and Crown Corporations 32 .5 Government of Canada 15 .6

Income Investment Fund 8 .3 Mortgage-Backed Securities 1 .2 Money Market Securities 0 .8 Asset-Backed Securities 0 .6 Other Net Assets 0 .1 TOTAL 100

Income


Price RiskThe Fund may trade in financial instruments and take positions in over-the-counter instruments . The Manager's estimate of the impact on Net Assets Attributable to Contract Owners as a result of a reasonably possible change in benchmarks, using a historical beta coefficient (a measure of the sensitivity of a security in comparison to the market) between the Fund’s return as compared to the return of the Fund’s benchmarks, with all other variables held constant, is included in the following table . A 36-month regression analysis has been utilized to estimate the historical beta coefficient . The regression analysis uses data based on the monthly returns of the Fund .


%


June 30, 2016 $

Impact on Net Assets Attributable to Contract Owners December 31, 2015

$FTSE TMX Canada Universe 1 .00 970,637 1,021,326




as at June 30, 2016

Credit RiskThe Fund’s credit risk is mainly concentrated in fixed-income securities . Their fair values include consideration of the issuers' creditworthiness and accordingly, represent the Fund’s maximum exposure to credit risk .

Portfolio's Fixed-Income Securities by Credit Rating Category

Credit Rating Percentage of Fixed-Income Securities

June 30, 2016%

Percentage of Fixed-Income Securities

December 31, 2015%

AAA 22 20 AA 41 44 A 23 26 BBB 14 10 TOTAL 100 100

Securities Lending and Repurchase TransactionsAs part of its securities lending cash counter and repurchase transactions, the Fund is exposed to counterparty credit risk .The carrying amount of financial assets lent as part of repurchase transactions is:

$June 30, 2016 9,923,536 December 31, 2015 12,113,751

The fair value of the financial assets held as collateral that the Fund is permitted to sell or repledge in the absence of default totalled:

$June 30, 2016 6,591,949 December 31, 2015 5,988,222

The fair value of financial assets accepted as collateral which have been sold or repledged totalled:

$June 30, 2016 10,961 December 31, 2015 —

These financial assets were received as collateral as part of transactions involving reverse repurchase transactions .

Liquidity RiskFor further information on maturities of financial liabilities and liquidity risk management of the Fund, please refer to Note 7 “Financial Instruments Disclosures” .

DERECOGNITION OF FINANCIAL ASSETS

Securities Lending and Repurchase TransactionsAs part of transactions involving securities lending or repurchase transactions, the Fund transfers financial assets under terms and conditions providing for their future repurchase . These financial assets remain recognized in the ”Investments at fair value through profit or loss pledged as collateral” of the Statement of Financial Position as the Fund retains substantially all the risks and rewards related to these assets .

June 30, 2016$

December 31, 2015$

Investments at FVTPL pledged as Collateral 11,540,632 12,171,098 Value of Collateral received 11,772,356 12,414,521

The Funds require collateral in the form of cash or such other securities as may be acceptable to Desjardins Financial Security and that have an aggregate value of no less than 102% of the loaned securities fair value .



The following table presents the carrying amount and the fair value of financial assets transferred by the Fund but not derecognized as well as the related liabilities recognized in ”Commitments related to repurchase transactions” and ”Commitments related to securities lending” of the Statement of Financial Position .

Fair Value* June 30, 2016

$

Fair Value* December 31, 2015

$Financial Assets 9,923,536 12,113,751 Related Liabilities 9,960,959 12,107,884

*The fair value equals the carrying amount .

RECONCILIATION OF INCOME FROM SECURITY LENDING AND REPURCHASE TRANSACTION (Note 2)The following table shows a reconciliation of the total income generated from securities lending transactions of the Fund and the revenue from securities lending and repurchase transactions disclosed in the Fund’s Statement of Comprehensive Income .

June 30, 2016$

June 30, 2016%

June 30, 2015$

June 30, 2015%

Total Income 17,052 100 16,672 100Net Income received by: DFS GIF – Income – Fiera Capital 10,232 60 10,058 60Desjardins Trust 6,820 40 6,704 40

Income



June 30 2016

$

December 31 2015

$ASSETSCurrent AssetsInvestments at fair value through profit


42,413,330 41,362,540 LIABILITIESCurrent LiabilitiesBank overdraft 435 14,263 Accrued expenses 68,094 66,808 Withdrawals payable 105,853 108,098 Payable for securities purchased 18,868 —

193,250 189,169NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS 42,220,080 41,173,371


2016*$

INCOMEInterest for attribution purposes 531,075 Changes in fair value:

Net realized gain (loss) on investments 35,017 Net unrealized gain (loss) on investments 1,158,406

1,724,498 EXPENSESManagement fees and guarantee charge 272,298 Operating expenses 135,608

407,906

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 1,316,592


from Operations 1,197,882 - per unit 0.16

Average Number of Units 7,558,304 SERIES 6Increase (Decrease) in Net Assets

from Operations 113,210 - per unit 0.18

Average Number of Units 635,753 SERIES 7Increase (Decrease) in Net Assets


Average Number of Units 30,934

* Beginning of operations in October 2015.The accompanying Notes are an integral part of these financial statements.

Income

DFS GIF – CANADIAN BOND

STATEMENT OF FINANCIAL POSITION – unauditedAs at Six-month Period Ended June 30




2016*$

NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS, BEGINNING OF PERIOD 41,173,371 Increase (Decrease) in Net Assets

from operations attributable to contract owners 1,316,592

PremiumsSeries 5 2,333,407 Series 6 1,316,310 Series 7 —

3,649,717

WithdrawalsSeries 5 (3,818,936)Series 6 (100,349)Series 7 (315)

(3,919,600)

NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS, END OF PERIOD 42,220,080

2016*$


from operations attributable to contract owners 1,316,592

Adjustments for:Net realized gain (loss) (35,017)Net unrealized gain (loss) (1,158,406)

Proceeds from sale/maturity of investments 2,476,271

Investments purchased (2,325,026)Receivable for securities sold 47,928 Accrued expenses 1,286 Payable for securities purchased 18,868

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 342,496

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIESPremium payments 3,593,177 Amounts paid on withdrawals (3,921,845)

NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES (328,668)

Increase (Decrease) in cash/bank overdraft 13,828

Cash (bank overdraft), beginning of period (14,263)

CASH (BANK OVERDRAFT), END OF PERIOD (435)

Six-month Period Ended June 30

Six-month Period Ended June 30



Income

DFS GIF – CANADIAN BOND (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.3%)DGIA Canadian Bond Fund 4,034,235 41,061,649 42,328,165


OTHER NET ASSETS (-0.3%) (108,085)

NET ASSETS (100%) 42,220,080




Canada Housing Trust, 2 .00%, December 15, 2019 4 .6%NHA MBS Merrill Lynch, 1 .35%, May 1, 2020 3 .9%Province of Ontario, 2 .10%, September 8, 2019 3 .3%Province of Ontario, 2 .60%, June 2, 2025 3 .2%Government of Canada, 1 .50%, June 1, 2026 2 .8%Government of Canada, 5 .00%, June 1, 2037 2 .7%Province of Ontario, 6 .50%, March 8, 2029 2 .6%Province of Ontario, 2 .85%, June 2, 2023 2 .5%NHA First National Financial, 1 .20%, June 1, 2020 2 .4%Canadian Imperial Bank of Commerce, 2 .35%, October 18, 2017 2 .2%Province of Ontario, 3 .15%, June 2, 2022 2 .2%NHA MBS Merrill Lynch, 1 .07%, July 1, 2020 2 .0%Scotiabank, 1 .33%, May 1, 2018 2 .0%Canada Housing Trust, 2 .40%, December 15, 2022 1 .9%Toronto-Dominion Bank, 2 .447%, April 2, 2019 1 .9%Government of Canada, 3 .50%, December 1, 2045 1 .8%Province of Quebec, 3 .50%, December 1, 2045 1 .8%Province of Ontario, 4 .20%, June 2, 2020 1 .8%Royal Bank of Canada, 2 .26%, March 12, 2018 1 .7%Canada Housing Trust, 2 .90%, June 15, 2024 1 .7%Province of Ontario, 3 .45%, June 2, 2045 1 .5%Canada Housing Trust, 1 .25%, June 15, 2021 1 .4%Province of British Columbia, 2 .80%, June 18, 2048 1 .4%Canada Housing Trust, 1 .70%, December 15, 2017 1 .4%Government of Canada, 2 .75%, December 1, 2048 1 .4%




Investment ObjectiveTo provide regular income and capital security by investing in a portfolio of fixed-income securities from the Canadian bond market .

Investment StrategyThis Fund, actively managed, aims to provide regular income and capital security by investing in a portfolio of fixed-income securities from the Canadian bond market . The Fund employs a fundamental investment approach targeting a consistent allocation of value added sources . The strategy seeks to add value through management of duration, yield curve and credit risk .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $








Income

DFS GIF – CANADIAN BOND (cont.)






%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe 1 .00 422,201 411,734





June 30 2016

$

December 31 2015



200,422,901 201,217,340 LIABILITIESCurrent LiabilitiesBank overdraft 60,169 37,246 Accrued expenses 472,743 480,766 Withdrawals payable 433,243 246,484 Payable for securities purchased 611,330 104,011

1,577,485 868,507 NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS 198,845,416 200,348,833

NET ASSETS PER UNITSeries 3 7.23 7 .24 Series 5 7.37 7 .36 Series 6 5.23 5 .22 Series 7 5.29 5 .27


Balanced and Asset Allocation

DFS GIF – DIVERSIFIED INCOME – FRANKLIN QUOTENTIAL


2016$

2015$

INCOMEChanges in fair value:

Net realized gain (loss) on investments 1,387,632 1,797,657 Net unrealized gain (loss) on investments 1,634,685 6,228,614

3,022,317 8,026,271 EXPENSESManagement fees and guarantee charge 2,283,718 2,247,188 Operating expenses 540,091 558,861

2,823,809 2,806,049

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 198,508 5,220,222


from Operations (10,288) 183,003 - per unit (0.01) 0 .20


from Operations 79,912 4,889,857 - per unit — 0 .21




from Operations 13,054 (3,134)- per unit 0.03 (0 .05)





2016$

2015$


from operations attributable to contract owners 198,508 5,220,222

PremiumsSeries 3 541,665 569,455 Series 5 8,343,613 8,399,633 Series 6 6,333,197 6,843,648 Series 7 436,944 601,340

15,655,419 16,414,076

WithdrawalsSeries 3 (977,050) (816,788)Series 5 (15,260,107) (15,724,963)Series 6 (1,091,938) (786,274)Series 7 (28,249) (849)

(17,357,344) (17,328,874)


STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS – unauditedSix-month Periods Ended June 30

2016$

2015$



Adjustments for:Net realized gain (loss) (1,387,632) (1,797,657)Net unrealized gain (loss) (1,634,685) (6,228,614)


Investments purchased (6,551,966) (3,323,278)Receivable for securities sold (52,021) 47,667 Accrued expenses (8,023) 13,298 Payable for securities purchased 507,319 (32,165)

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 2,026,844 740,459


NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES (2,049,767) (658,011)




STATEMENT OF CASH FLOWS – unauditedSix-month Periods Ended June 30



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.4%)Franklin Quotential Diversified Income Portfolio 27,616,630 171,153,622 199,668,233



NET ASSETS (100%) 198,845,416


TOP HOLDINGS OF THE UNDERLYING FUND – unaudited


Franklin Bissett Core Plus Bond Fund 24 .4%Franklin Strategic Income Fund 9 .6%Franklin Bissett Canadian Short Term Bond Fund 9 .0%Templeton Global Bond Fund 8 .9%Cash and Cash Equivalents 8 .2%BMO Mid Federal Bond Index ETF 6 .4%Franklin Bissett Canadian Dividend Fund 4 .5%iShares TIPS Bond ETF 3 .9%iShares iBoxx High Yield Corporate Bond ETF 3 .8%Franklin U .S . Rising Dividends Fund 3 .1%WisdomTree Australia & New Zealand Debt ETF 3 .1%Templeton Emerging Markets Fund 2 .1%Franklin Global Real Estate Fund 2 .1%Franklin Global Listed Infrastructure Fund 2 .1%Franklin Mutual European Fund 2 .0%Franklin Bisset All Canadian Focus Fund 1 .6%Franklin U .S . Core Equity Fund 1 .6%SPDR Gold Trust ETF 1 .2%iShares S&P/TSX 60 Index ETF 0 .6%Franklin Japan Fund 0 .5%iShares MSCI Japan ETF 0 .5%Franklin European Small-Mid Cap Growth Fund 0 .5%SPDR Euro Stoxx 50 ETF 0 .5%


DFS GIF – DIVERSIFIED INCOME – FRANKLIN QUOTENTIAL (cont.)




Investment ObjectiveTo provide a balance of capital growth and interest income by investing primarily in units of an underlying fund in order to gain the desired exposure to the equity and fixed income markets .

Investment StrategyTo emphasize investments in fixed income underlying funds in order to provide income and capital preservation . The Fund also invests, to a lesser extent, in equity underlying funds in order to increase the potential for capital appreciation over a longer investment horizon .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLInvestment Funds 199,668,233 — — 199,668,233 TOTAL 199,668,233 — — 199,668,233


Level 2 $

Level 3 $

Total $





Underlying Fund Risk ManagementMonthly, the investment strategy team compares the Fund’s performance to similar funds as well as to the related benchmarks . Quarterly, this team makes an analysis of the Fund’s performance . This analysis includes among others a review of the securities having obtained a greater or lower performance than forecasts, an evaluation of the strategies used as well as a complete analysis of the sector . It also ensures the compliance with the Fund’s investment policies . Furthermore, it examines thoughtfully any change within the organization, such as the recruitment, the departure of key staff or any structure modification .Annually, this team reviews the practices and processes used by the Fund’s managers through an exhaustive questionnaire and periodic meetings .






Price RiskThe majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which is exposed to price risk . As a result, the Fund is exposed to price risk related to the current underlying fund . Detailed disclosure about the price risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .The Manager’s estimate of the impact on Net Assets Attributable to Contract Owners as a result of a reasonably possible change in benchmarks, using a historical beta coefficient (a measure of the sensitivity of a security in comparison to the market) between the Fund’s return as compared to the return of the Fund’s benchmarks, with all other variables held constant, is included in the following table . A 36-month regression analysis has been utilized to estimate the historical beta coefficient . The regression analysis uses data based on the monthly returns of the Fund .


%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (55%) 1 .00 1,257,053 1,177,847Barclays Capital Multiverse (25%) 1 .00 571,388 535,385S&P/TSX (15%) 3 .00 1,028,498 963,693MSCI All Country World Net (5%) 3 .00 342,833 321,231





DFS GIF – DIVERSIFIED INCOME – FRANKLIN QUOTENTIAL (cont.)


June 30 2016

$

December 31 2015



251,060,714 259,973,049 LIABILITIESCurrent LiabilitiesBank overdraft — 12,448 Accrued expenses 610,212 630,536 Withdrawals payable 632,260 295,171 Payable for securities purchased — 114,512

1,242,472 1,052,667 NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS 249,818,242 258,920,382




DFS GIF – BALANCED INCOME – FRANKLIN QUOTENTIAL


2016$

2015$


Net realized gain (loss) on investments 2,491,173 3,499,632 Net unrealized gain (loss) on investments (3,202,569) 13,291,250

(711,396) 16,790,882 EXPENSESManagement fees and guarantee charge 2,942,958 3,072,497 Operating expenses 713,753 777,422

3,656,711 3,849,919

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS (4,368,107) 12,940,963




from Operations (3,899,071) 12,087,918 - per unit (0.12) 0 .35









2016$

2015$


from operations attributable to contract owners (4,368,107) 12,940,963


15,686,130 15,131,645

WithdrawalsSeries 3 (1,145,980) (1,195,137)Series 5 (17,783,659) (19,854,643)Series 6 (899,770) (204,163)Series 7 (590,754) (19,500)

(20,420,163) (21,273,443)



2016$

2015$



Adjustments for:Net realized gain (loss) (2,491,173) (3,499,632)Net unrealized gain (loss) 3,202,569 (13,291,250)


Investments purchased (3,902,896) (84,459)Receivable for securities sold (99,378) 97,644 Accrued expenses (20,324) 21,097 Payable for securities purchased (114,512) 88,540





Cash (bank overdraft), beginning of period (12,448) 31,643




DFS GIF – BALANCED INCOME – FRANKLIN QUOTENTIAL (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.4%)Franklin Quotential Balanced Income Portfolio 26,820,891 196,630,937 250,775,330



NET ASSETS (100%) 249,818,242




Franklin Bissett Core Plus Bond Fund 27 .0%Franklin Strategic Income Fund 6 .6%Templeton Global Bond Fund 6 .5%Franklin Bissett Canadian Equity Fund 4 .7%BMO Mid Federal Bond Index ETF 4 .5%Franklin U .S . Core Equity Fund 4 .2%Franklin U .S . Rising Dividends Fund 4 .0%Franklin Mutual European Fund 3 .7%iShares TIPS Bond ETF 3 .6%Franklin Bisset All Canadian Focus Fund 2 .9%iShares iBoxx High Yield Corporate Bond ETF 2 .8%Templeton Asian Growth Fund 2 .6%Franklin U .S . Opportunities Fund 2 .5%Franklin Templeton Canadian Large Cap Fund 2 .4%WisdomTree Australia & New Zealand Debt ETF 2 .2%Franklin Bissett Small Cap Fund 1 .7%iShares Russell 1000 Value ETF 1 .5%SPDR Gold Trust ETF 1 .5%Franklin Japan Fund 1 .4%SPDR Euro Stoxx 50 ETF 1 .4%Franklin European Small-Mid Cap Growth Fund 0 .9%Templeton Emerging Markets Smaller Companies Fund 0 .9%iShares MSCI Japan ETF 0 .7%iShares MSCI Japan Small-Cap ETF 0 .6%Franklin India Fund 0 .5%




Investment ObjectiveTo provide a balance of capital growth and interest income by investing primarily in units of an individual underlying fund in order to gain the desired exposure to the equity and fixed income markets .

Investment StrategyTo invest in fixed income underlying funds in order to provide income and capital preservation . The Fund also invests in equity underlying funds in order to increase the potential for capital appreciation over a longer investment horizon .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $





Underlying Fund Risk ManagementMonthly, the investment strategy team compares the Fund’s performance to similar funds as well as to the related benchmarks .Quarterly, this team makes an analysis of the Fund’s performance . This analysis includes among others a review of the securities having obtained a greater or lower performance than forecasts, an evaluation of the strategies used as well as a complete analysis of the sector . It also ensures the compliance with the Fund’s investment policies . Furthermore, it examines thoughtfully any change within the organization, such as the recruitment, the departure of key staff or any structure modification . Annually, this team reviews the practices and processes used by the Fund’s managers through an exhaustive questionnaire and periodic meetings .




DFS GIF – BALANCED INCOME – FRANKLIN QUOTENTIAL (cont.)






%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (45%) 1 .00 1,346,775 1,279,171Barclays Capital Multiverse (15%) 1 .00 448,925 426,390S&P/TSX (20%) 3 .00 1,795,700 1,705,561MSCI All Country World Net (20%) 3 .00 1,795,700 1,705,561





June 30 2016

$

December 31 2015



878,975,024 883,541,089 LIABILITIESCurrent LiabilitiesAccrued expenses 2,142,518 2,169,456 Withdrawals payable 1,992,477 1,356,538 Payable for securities purchased 34,686 610,271

4,169,681 4,136,265





DFS GIF – CANADIAN BALANCED – FIDELITY


2016$

2015$

INCOMEInterest for attribution purposes 654,062 1,245,720 Dividends 12,557,999 12,734,034 Changes in fair value: Net realized gain (loss)

on investments 6,054,442 10,046,534 Net unrealized gain (loss)

on investments 13,256,991 41,192,206 32,523,494 65,218,494

EXPENSESManagement fees and guarantee charge 10,211,171 10,908,068 Operating expenses 2,488,959 2,696,597

12,700,130 13,604,665 Withholding taxes 130,812 138,413

12,830,942 13,743,078














2016$

2015$



PremiumsSeries 3 1,226,399 1,221,685 Series 5 43,790,156 42,001,095 Series 6 5,574,468 9,726,124 Series 7 315,718 225,509

50,906,741 53,174,413

WithdrawalsSeries 3 (1,561,530) (1,075,222)Series 5 (70,798,840) (70,570,138)Series 6 (2,335,018) (2,552,324)Series 7 (503,386) (5,882)

(75,198,774) (74,203,566)



2016$

2015$





Investments purchased (15,651,651) (9,006,580)Receivable for securities sold (17,211) 104,790 Accrued expenses (26,938) 99,244 Payable for securities purchased (575,585) 41,241










Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.4%)Fidelity Canadian Balanced Fund, Series O 37,964,111 723,205,968 877,881,642


OTHER NET ASSETS (-0.4%) (3,076,299)

NET ASSETS (100%) 874,805,343




Royal Bank of Canada 3 .4%Scotiabank 2 .9%Restaurant Brands International 2 .5%Brookfield Asset Management 2 .5%Toronto-Dominion Bank 2 .2%Enbridge 2 .1%Canadian Pacific Railway 2 .0%Rogers Communications 1 .8%Fortis 1 .7%Canadian Natural Resources 1 .5%Barrick Gold Corporation 1 .3%Agnico-Eagle Mines Ltd 1 .1%Raging River Exploration 1 .1%EOG Resources 1 .0%Gildan Activewear 1 .0%Province of Ontario, 3 .15%, June 2, 2022 0 .9%Randgold Resources Ltd 0 .9%ARC Resources 0 .9%TELUS Corporation 0 .9%National Bank of Canada 0 .9%Silver Wheaton Corporation 0 .8%Loblaw Companies 0 .8%Province of Ontario, 2 .85%, June 2, 2023 0 .8%Peyto Exploration & Development Corporation 0 .8%Brookfield Property Partners 0 .8%


DFS GIF – CANADIAN BALANCED – FIDELITY (cont.)




Investment ObjectiveTo achieve high total investment return using a diversified portfolio targeting long-term capital appreciation and a regular income stream through investment in any kind of equity or fixed-income security or money market instrument . The fundamental investment objective of the Fund is to provide investors with a balanced asset mix with the potential for capital growth .

Investment StrategyTarget fixed asset allocation to deliver superior long-term growth potential and reduced levels of risk . The Fund invests primarily in a mix of Canadian equity securities, investment grade bonds, high yield securities and money market instruments . The equity investment decisions are based on a thorough examination of the company, financial conditions and long-term earnings potential .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (40%) 1 .00 3,505,523 3,477,627Merrill Lynch High Yield Master II (10%) 2 .00 1,752,762 1,738,814S&P/TSX Capped (50%) 3 .00 13,145,713 13,041,103





DFS GIF – CANADIAN BALANCED – FIDELITY (cont.)


June 30 2016

$

December 31 2015


or loss (FVTPL) 6,804,811 2,641,839 Premiums receivable 6,544 34,992 Receivable for securities sold 65 —

6,811,420 2,688,168 LIABILITIESCurrent LiabilitiesBank overdraft 66 —Accrued expenses 15,543 5,288 Withdrawals payable 1,169 393 Payable for securities purchased 6,515 46,330





DFS GIF – U.S. MONTHLY INCOME – FIDELITY


2016*$

INCOMEDividends 65,002 Changes in fair value: Net realized gain (loss)

on investments (8,642) Net unrealized gain (loss)

on investments (17,769)38,591

EXPENSESManagement fees and guarantee charge 73,755 Operating expenses 6,147

79,902 Withholding taxes 7,983

87,885

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS (49,294)


from Operations (33,902)- per unit (0.08)






STATEMENT OF COMPREHENSIVE INCOME – unauditedSix-month Period Ended June 30




2016*$


from operations attributable to contract owners (49,294)

PremiumsSeries 5 2,132,633 Series 6 2,167,131 Series 7 392,268

4,692,032

WithdrawalsSeries 5 (215,597)Series 6 (207,063)Series 7 (68,108)

(490,768)


STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS – unauditedSix-month Period Ended June 30

2016*$


from operations attributable to contract owners (49,294)

Adjustments for:Net realized gain (loss) 8,642 Net unrealized gain (loss) 17,769

Proceeds from sale/maturity of investments 176,341

Investments purchased (4,365,724)Receivable for securities sold (65)Accrued expenses 10,255 Payable for securities purchased (39,815)

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES (4,241,891)

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIESPremium payments 4,720,480 Amounts paid on withdrawals (489,992)

NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES 4,230,488

Increase (Decrease) in cash/bank overdraft (11,403)

Cash (bank overdraft), beginning of period 11,337

CASH (BANK OVERDRAFT), END OF PERIOD (66)

STATEMENT OF CASH FLOWS – unauditedSix-month Period Ended June 30



DFS GIF – U.S. MONTHLY INCOME – FIDELITY (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.2%)Fidelity U .S . Monthly Income Fund, Series O 310,660 6,884,922 6,804,811



NET ASSETS (100%) 6,788,127




iShares 20+ Year Treasury Bond ETF 1 .8%Chevron Corporation 1 .8%Johnson & Johnson 1 .7%JPMorgan Chase & Company 1 .4%Procter & Gamble Company 1 .3%Freddie Mac, 3 .50%, 30 Year 1 .3%General Electric Company 1 .2%U .S . Treasury Note, 1 .25%, March 31, 2021 1 .2%U .S . Treasury Note, 0 .375%, July 15, 2025 1 .1%U .S . Treasury Bill, 3 .00%, May 15, 2045 1 .0%United Parcel Service 0 .8%CVS Health Corporation 0 .8%Cisco Systems 0 .8%AT&T 0 .8%Ginnie Mae, 3 .50%, 30 Year 0 .7%Chubb Ltd 0 .7%M&T Bank Corporation 0 .7%Williams Companies 0 .7%Freddie Mac, 4 .00%, 30 Year 0 .7%Verizon Communications 0 .6%Simon Property Group 0 .6%Wells Fargo & Company 0 .6%United Technologies Corporation 0 .6%Exelon Corporation 0 .6%Fannie Mae, 3 .00%, 30 Year 0 .5%




Investment ObjectiveTo achieve a combination of a steady flow of income and the potential for capital gains by investing in a mix of U .S . income-producing securities .

Investment StrategyThe Fund invests primarily in a mix of U .S . income-producing securities, either directly or indirectly through investments in underlying funds . The Fund’s neutral mix is 50% exposure to equity securities and 50% exposure to fixed-income securities . These securities may be U .S . securities or non-U .S . securities but at least 70% of the Fund’s net assets will be invested in U .S . dollar-denominated investments .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $






Currency RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which may be exposed to currency risk . As a result, the Fund may be exposed to currency risk related to the current underlying fund . Detailed disclosure about the currency risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .Interest Rate RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which may be exposed to interest rate risk . As a result, the Fund may be exposed to interest rate risk related to the current underlying fund . Detailed disclosure about the interest rate risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .


DFS GIF – U.S. MONTHLY INCOME – FIDELITY (cont.)



Concentration RiskAs at June 30, 2016 and December 31, 2015, the majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which is exposed to concentration risk . As a result, the Fund is exposed to concentration risk related to the current underlying fund . Detailed disclosure about the concentration risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .Price RiskThe majority of the Net Assets Attributable to Contract Owners are invested in an underlying fund which is exposed to price risk . As a result, the Fund is exposed to price risk related to the current underlying fund . Detailed disclosure about the price risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .The Manager’s best estimate of the impact on Net Assets Attributable to Contract Owners as a result of a reasonably possible change in benchmarks, with all other variables held constant, is as follows:


%


June 30, 2016 $


December 31, 2015 $

Barclays Capital US Aggregate Bond (31%) 1 .50 31,565 12,258Bank of America ML all US Convertibles (5%) 1 .50 5,091 1,977Bank of America ML High Yield Master II Constrained (12%) 2 .00 16,292 6,327JP Morgan EMBI Global Diversified (5%) 2 .00 6,788 2,636Russell 3000 Value (40%) 3 .00 81,458 31,634FTSE NAREIT Equity REITs (7%) 3 .00 14,255 5,536





June 30 2016

$

December 31 2015


or loss (FVTPL) 11,460,989 8,142,045 Premiums receivable 379,563 109,603 Receivable for securities sold — 349

11,853,604 8,251,997 LIABILITIESCurrent LiabilitiesBank overdraft — 355 Accrued expenses 25,253 18,806 Withdrawals payable 97,864 6,385 Payable for securities purchased 304,267 13,507





DFS GIF – BALANCED – DESJARDINS SOCIETERRA


2016*$

INCOMEInterest for attribution purposes 4Changes in fair value: Net realized gain (loss)

on investments (12,106) Net unrealized gain (loss)

on investments 195,351 183,249

EXPENSESManagement fees and guarantee charge 110,919 Operating expenses 25,328

136,247

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 47,002


from Operations 845 - per unit —

Average Number of Units 1,411,926 SERIES 6Increase (Decrease) in Net Assets





STATEMENT OF COMPREHENSIVE INCOME – unauditedSix-month Period Ended June 30




2016*$


from operations attributable to contract owners 47,002

PremiumsSeries 5 581,267 Series 6 2,821,515 Series 7 462,848

3,865,630

WithdrawalsSeries 5 (480,135)Series 6 (179,552)Series 7 (39,669)

(699,356)


STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS – unauditedSix-month Period Ended June 30

2016*$


from operations attributable to contract owners 47,002

Adjustments for:Net realized gain (loss) 12,106 Net unrealized gain (loss) (195,351)

Proceeds from sale/maturity of investments 254,128

Investments purchased (3,389,827)Receivable for securities sold 349 Accrued expenses 6,447 Payable for securities purchased 290,760

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES (2,974,386)

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIESPremium payments 3,595,670 Amounts paid on withdrawals (607,877)

NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES 2,987,793

Increase (Decrease) in cash/bank overdraft 13,407

Cash (bank overdraft), beginning of period (355)

CASH (BANK OVERDRAFT), END OF PERIOD 13,052

STATEMENT OF CASH FLOWS – unauditedSix-month Period Ended June 30




Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.3%)SocieTerra Balanced Portfolio, I-Class 1,208,201 11,773,024 11,460,989



NET ASSETS (100%) 11,426,220




Desjardins SocieTerra Canadian Bond Fund 50 .5%NEI Ethical Canadian Equity Fund 11 .6%Desjardins SocieTerra American Equity Fund 10 .8%NEI Ethical International Equity Fund 10 .4%Desjardins SocieTerra Environment Fund 6 .9%Desjardins SocieTerra Environmental Bond Fund 5 .5%NEI Ethical Special Equity Fund 2 .6%Desjardins SocieTerra Cleantech Fund 1 .5%Cash and Cash Equivalents 0 .2%


DFS GIF – BALANCED – DESJARDINS SOCIETERRA (cont.)




Investment ObjectiveTo achieve a balance between long-term capital appreciation and income by investing primarily in Canadian, and to a lesser extent, foreign equity and fixed-income securities and/or in units of mutual funds which themselves invest primarily in Canadian or foreign equity and fixed-income securities . The Fund follows a socially responsible approach to investing .

Investment StrategyTo reach the Fund’s investment objective, selection of the securities and/or the underlying funds as well as the percentage of the assets that will be invested in each of these securities or underlying funds will be based on the following target weightings: Fixed-income (55%) and Growth (45%) .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (55%) 1 .00 62,844 45,171S&P/TSX (14%) 3 .00 47,990 34,494MSCI World Net (31%) 3 .00 106,264 76,380





DFS GIF – BALANCED – DESJARDINS SOCIETERRA (cont.)


June 30 2016

$

December 31 2015



224,678,418 205,240,543 LIABILITIESCurrent LiabilitiesAccrued expenses 527,845 481,607 Withdrawals payable 861,122 448,188 Payable for securities purchased 49,022 54,296





DFS GIF – GLOBAL BALANCED – JARISLOWSKY FRASER



2016$

2015$

INCOMEInterest for attribution purposes 1,268,924 946,943 Dividends 1,759,180 1,417,372 Changes in fair value:

Net realized gain (loss) on investments 697,284 2,040,264 Net unrealized gain (loss) on investments (2,715,882) 3,900,312

1,009,506 8,304,891

EXPENSESManagement fees and guarantee charge 2,206,777 1,638,998 Operating expenses 841,512 667,898


3,192,496 2,419,377








SERIES 6*Increase (Decrease) in Net Assets


Average Number of Units 3,008,101






The accompanying Notes are an integral part of these financial statements.* Beginning of operations in October 2015.

2016$

2015$



PremiumsSeries 3 687,938 651,555 Series 5 27,944,123 11,430,277 Series 6* 13,268,697 —Series 7* 881,033 —

42,781,791 12,081,832

WithdrawalsSeries 3 (863,233) (753,755)Series 5 (19,964,318) (12,276,293)Series 6* (717,609) —Series 7* (69,664) —

(21,614,824) (13,030,048)


2016$

2015$



Adjustments for:Net realized gain (loss) (697,284) (2,040,264)Net unrealized gain (loss) 2,715,882 (3,900,312)


Investments purchased (26,115,120) (10,018,616)Receivable for securities sold — (25,198)Accrued expenses 46,238 17,979 Payable for securities purchased (5,274) (172,235)

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES (21,532,050) 797,295


NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES 21,390,596 (1,113,165)








DFS GIF – GLOBAL BALANCED – JARISLOWSKY FRASER (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.0%)Jarislowsky Fraser Global Balanced Fund 17,259,347 190,187,218 223,262,171



NET ASSETS (100%) 223,240,429




Jarislowsky Fraser International Pooled Fund 18 .4%Jarislowsky Fraser Special Equity Fund 2 .0%Toronto-Dominion Bank 1 .8%Government of Canada, 3 .50%, December 1, 2045 1 .6%Royal Bank of Canada 1 .4%Scotiabank 1 .3%Microsoft Corporation 1 .0%Province of Ontario, 2 .85%, June 2, 2023 1 .0%Government of Canada, 1 .25%, December 1, 2047 1 .0%Enbridge 1 .0%Canadian National Railway Company 0 .9%Canadian Natural Resources 0 .9%Suncor Energy 0 .8%Canadian Imperial Bank of Commerce, 1 .70%, October 9, 2018 0 .8%National Grid Electricity Transmission, 2 .90%, November 26, 2019 0 .8%Open Text Corporation 0 .8%Bank of Montréal, 2 .12%, March 16, 2022 0 .8%Walgreens Boots Alliance 0 .7%CVS Health Corporation 0 .7%Manulife Financial Corporation 0 .7%Colgate-Palmolive Company 0 .7%Canada Housing Trust, 1 .20%, June 15, 2020 0 .7%SNC-Lavalin Group 0 .7%Oracle Corporation 0 .7%Comcast Corporation 0 .7%




Investment ObjectiveTo provide investors with an opportunity to achieve a high rate of return by investing in a diversified portfolio consisting of a balance of equity and fixed-income securities of issuers located throughout the world .

Investment StrategyTo provide such an opportunity through a diversified portfolio consisting of a balance of mainly large cap equity and mainly investment grade fixed-income securities of issuers located throughout the world .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $









DFS GIF – GLOBAL BALANCED – JARISLOWSKY FRASER (cont.)






%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada 91 Day Treasury Bills (6%) 0 .25 36,806 31,196FTSE TMX Canada Universe (40%) 1 .00 981,494 831,884S&P/TSX (22%) 3 .00 1,619,464 1,372,609S&P 500 (16%) 3 .00 1,177,792 998,261MSCI EAFE Net (16%) 3 .00 1,177,792 998,261





June 30 2016

$

December 31 2015



or loss (FVTPL) pledged as collateral 17,000,836 21,876,504 Premiums receivable 106,031 64,188 Receivable for securities sold 680,960 2,346,923 Cash guarantee received for repurchase

transactions 10,307,101 5,685,138 Interest, dividends and other receivables 331,109 379,735

192,093,084 191,363,522 LIABILITIESCurrent LiabilitiesBank overdraft — 785 Accrued expenses 396,491 410,645 Withdrawals payable 348,362 67,850 Payable for securities purchased 1,652,155 —Commitments related to repurchase

transactions 10,307,101 5,685,138 12,704,109 6,164,418





DFS GIF – CANADIAN BALANCED – FIERA CAPITAL


2016$

2015$

INCOMEInterest for attribution purposes 682,642 733,640 Dividends 1,843,375 1,575,531 Revenue from securities lending and

repurchase transactions 10,067 13,300 Foreign exchange gain (loss) on cash — 9,204 Changes in fair value:

Net realized gain (loss) on investments 3,588,975 6,769,196 Net unrealized gain (loss) on investments 2,765 2,083,841

6,127,824 11,184,712


2,369,514 2,640,920 Withholding taxes 90,715 79,288 Commissions and other portfolio

transaction costs 132,008 85,773 2,592,237 2,805,981




















2016$

2015$



PremiumsSeries 1 53,045 60,676 Series 3 276,023 739,176 Series 5 6,030,569 5,253,455 Series 6 1,716,765 2,813,447 Series 7 — 205,405

8,076,402 9,072,159

WithdrawalsSeries 1 (489,603) (939,738)Series 3 (1,807,308) (1,795,698)Series 5 (14,749,352) (13,998,020)Series 6 (370,994) (172,211)Series 7 (4,861) (5,197)

(17,422,118) (16,910,864)


2016$

2015$



Adjustments for:Foreign exchange gain (loss) on cash — (9,204)Net realized gain (loss) (3,588,975) (6,769,196)Net unrealized gain (loss) (2,765) (2,083,841)


Investments purchased (164,883,974) (174,581,731)Receivable for securities sold 1,665,963 (1,909,936)Cash guarantee received for repurchase

transactions (4,621,963) (7,275,491)Interest, dividends and other receivables 48,626 7,067 Accrued expenses (14,154) 8,334 Commitments related to repurchase

transactions 4,621,963 7,275,491 Payable for securities purchased 1,652,155 1,906,352




Effect of exchange rate changes on foreign cash (1,789) 4,106


Cash (bank overdraft), beginning of period (785) 77,260


SUPPLEMENTAL INFORMATION ON CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES

Interest received 709,947 752,860 Dividends received, net of

withholding taxes 1,122,859 909,703Interest paid 1 4




FOR EASE OF COMPREHENSION TO THE READER, FOR THE DFS GIF – CANADIAN BALANCED – FIERA CAPITAL, THE ENTIRE PORTFOLIO OF SECURITIES IN THE SCHEDULE OF INVESTMENT PORTFOLIO AS AT JUNE 30, 2016, HAS NOT BEEN DISCLOSED. INSTEAD, THE MAJOR CATEGORIES OF ASSETS ARE LISTED ALONG WITH THE PERCENTAGES THAT EACH OF THESE CATEGORIES HOLD. THE TOTAL COSTS, FAIR VALUES, NUMBER OF UNITS, TOTAL INVESTMENTS AND NET ASSETS ARE ALSO LISTED.



DFS GIF – CANADIAN BALANCED – FIERA CAPITAL (cont.)


Number Fair of Shares Cost Value $ $EQUITIES (44.2%)

Energy (8.3%)Canadian Natural Resources 71,527 2,407,871 2,851,066 Cenovus Energy 84,435 1,633,580 1,508,853 Crescent Point Energy 55,404 1,231,042 1,130,796 Enbridge 50,367 2,560,070 2,756,586 Husky Energy 78,074 1,196,383 1,231,227 Peyto Exploration & Development 34,735 1,023,242 1,204,610 Suncor Energy 54,831 1,927,328 1,965,143 TransCanada, Subscription Receipts 39,684 1,815,543 2,314,371

13,795,059 14,962,652

Materials (7.1%)Agrium 8,748 1,108,953 1,022,554 Barrick Gold 42,848 1,173,777 1,181,748 CCL Industries, Class B 10,958 1,193,220 2,463,797 First Quantum Minerals 142,030 1,486,828 1,288,212 Franco-Nevada 9,477 557,451 931,020 Tahoe Resources 148,974 2,100,275 2,882,647 Yamana Gold 432,791 2,523,771 2,908,356

10,144,275 12,678,334

Industrials (4.2%)Canadian National Railway Company 45,408 2,790,865 3,464,176 Canadian Pacific Railway 11,693 1,919,509 1,944,897 Waste Connections 22,885 1,873,359 2,136,086

6,583,733 7,545,159

Consumer Discretionary (4.7%)Dollarama 17,630 892,980 1,590,226 Gildan Activewear* 72,537 2,263,973 2,744,800 Magna International, Class A 33,900 1,728,954 1,537,365 Quebecor, Class B 33,115 1,090,808 1,225,917 Restaurant Brands International 26,323 1,432,952 1,415,651

7,409,667 8,513,959

Consumer Staples (2.6%)Alimentation Couche-Tard, Class B 51,901 2,325,818 2,879,467 Loblaw Companies 25,432 1,384,344 1,757,606

3,710,162 4,637,073

Health Care (0.2%)Valeant Pharmaceuticals International* 17,065 3,450,499 444,543

Financials (15.1%)Brookfield Asset Management, Class A 43,000 1,875,619 1,837,820 CI Financial 37,898 1,196,849 1,021,351 Element Financial Corporation 194,841 2,883,555 2,669,322 Intact Financial Corporation 12,130 1,008,956 1,119,478 Manulife Financial 156,164 3,230,648 2,759,418




Number Fair of Shares Cost Value $ $Financials (cont.)

Royal Bank of Canada 87,457 5,762,068 6,676,467 Scotiabank 77,399 4,620,534 4,900,131 Toronto-Dominion Bank 108,959 4,838,619 6,045,045

25,416,848 27,029,032

Information Technology (1.5%)CGI Group, Class A* 48,265 1,970,074 2,663,745

Utilities (0.5%)Algonquin Power & Utilities Corp . 75,826 822,756 901,578

TOTAL EQUITIES 73,303,073 79,376,075

Par Value BONDS (21.3%)

Canadian Bonds (21.3%)

Government of Canada (3.6%)Broadcast Center Trust 7 .530%, 2027-05-01 CAD 204,498 221,629 274,421 Canada Housing Trust 2 .350%, 2018-12-15 CAD 793,000 830,680 823,658 Government of Canada 0 .250%, 2018-05-01* CAD 1,769,000 1,759,517 1,760,437 2 .250%, 2025-06-01* CAD 19,000 20,689 21,114 Series E679, 1 .500%, 2026-06-01* CAD 2,425,000 2,508,214 2,524,997 5 .750%, 2033-06-01 CAD 31,000 49,770 50,046 PSP Capital Series 7, 3 .290%, 2024-04-04 CAD 120,000 119,939 133,246 Royal Office Finance Series A, 5 .209%, 2032-11-12 CAD 716,335 710,252 912,997

6,220,690 6,500,916 Provincial Governments and Crown Corporations (8.9%)

Ontario Infrastructure 4 .700%, 2037-06-01 CAD 70,000 70,093 87,082 Ontario School Boards Financing Corporation Series 00A1, 7 .200%, 2025-06-09 CAD 327,614 397,428 412,802 Series 04A1, 5 .483%, 2029-11-26 CAD 384,450 410,291 474,750 Private Placement, Series 06A1, 5 .070%, 2031-04-18 CAD 369,838 369,838 435,803 Province of Alberta 3 .900%, 2033-12-01 CAD 132,000 131,418 151,663 3 .300%, 2046-12-01* CAD 1,019,000 1,021,224 1,100,918 Province of British Columbia 3 .200%, 2044-06-18 CAD 236,000 218,064 260,288 Province of Newfoundland and Labrador Series 6Z, 3 .000%, 2026-06-02 CAD 275,000 274,681 287,806




Par Fair Value Cost Value $ $Provincial Governments and Crown Corporations (cont.)

Province of Ontario 4 .400%, 2019-06-02 CAD 651,000 734,099 714,838 4 .000%, 2021-06-02* CAD 24,000 26,238 27,170 3 .150%, 2022-06-02* CAD 1,322,000 1,348,465 1,454,489 2 .850%, 2023-06-02 CAD 2,171,000 2,137,575 2,357,128 3 .500%, 2024-06-02 CAD 982,000 1,040,912 1,113,683 2 .600%, 2025-06-02* CAD 848,000 880,012 901,694 3 .500%, 2043-06-02 CAD 24,000 22,362 27,370 2 .900%, 2046-12-02* CAD 1,234,000 1,207,716 1,274,603 2 .800%, 2048-06-02* CAD 46,000 45,720 46,662 Province of Québec 4 .500%, 2019-12-01* CAD 1,110,000 1,228,858 1,238,079 3 .500%, 2022-12-01 CAD 612,000 638,452 687,143 2 .750%, 2025-09-01 CAD 314,000 329,800 337,172 5 .750%, 2036-12-01 CAD 103,000 141,913 150,830 4 .250%, 2043-12-01 CAD 233,000 238,436 296,905 3 .500%, 2045-12-01 CAD 1,526,000 1,590,223 1,739,502 3 .500%, 2048-12-01* CAD 52,000 58,620 59,945 TCHC Issuer Trust 4 .877%, 2037-05-11 CAD 59,000 59,000 74,375 Series B, 5 .395%, 2040-02-22 CAD 110,000 112,200 150,909

14,733,638 15,863,609

Corporations (8.8%)Bank of Montreal 2 .960%, 2016-08-02 CAD 450,000 459,240 450,719 2 .390%, 2017-07-12 CAD 531,000 532,638 538,127 3 .979%, (floating rate from 2016-07-08), 2021-07-08 CAD 437,000 458,038 437,080 3 .340%, (floating rate from 2020-12-08), 2025-12-08 CAD 290,000 289,893 294,736 3 .320%, (floating rate from 2021-06-01), 2026-06-01 CAD 390,000 389,945 394,735 Blackbird Infrastructure 407 General Partners 1 .713%, (floating rate from 2020-01-08), 2021-10-08 CAD 77,000 76,400 77,073 British Columbia Ferry Services 5 .021%, 2037-03-20 CAD 70,000 70,000 86,969 Caisse centrale Desjardins 3 .502%, 2017-10-05* CAD 100,000 105,390 102,818 2 .443%, 2019-07-17 CAD 310,000 322,214 319,271 Canadian Imperial Bank of Commerce 2 .350%, 2017-10-18 CAD 872,000 878,474 885,122 3 .000%, (floating rate from 2019-10-28), 2024-10-28 CAD 30,000 30,534 30,117 3 .420%, (floating rate from 2021-01-26), 2026-01-26 CAD 266,000 266,975 270,915 Canadian Utilities 4 .543%, 2041-10-24 CAD 150,000 159,385 176,804 4 .722%, 2043-09-09 CAD 63,000 69,119 76,577 4 .085%, 2044-09-02* CAD 62,000 62,916 68,733 Capital City Link Series A, 4 .386%, 2046-03-31 CAD 182,000 181,662 195,543 Capital Desjardins Series G, 5 .187%, 2020-05-05* CAD 160,000 184,640 178,571Cominar Real Estate Investment Trust Series 9, 4 .164%, 2022-06-01 CAD 245,000 245,000 251,163 Series 10, 4 .247%, 2023-05-23 CAD 103,000 103,000 104,862CSS (FSCC) Partnership 6 .915%, 2042-07-31 CAD 18,431 23,655 25,474







Enbridge 3 .940%, 2023-06-30* CAD 120,000 120,000 127,251 7 .200%, 2032-06-18 CAD 229,000 284,550 294,194 4 .570%, 2044-03-11* CAD 344,000 317,446 332,108 Grand Renewable Solar Series 1A, 3 .926%, 2035-01-31 CAD 104,000 104,000 107,170 Greater Toronto Airports Authority Series 99-1, 6 .450%, 2029-07-30 CAD 122,596 134,464 157,937 Health Montréal Collective, Private Placement Series 144A, 6 .721%, 2049-09-30 CAD 489,000 595,071 673,367 Hospital Infrastructure Series A, 5 .439%, 2045-01-31 CAD 153,747 153,746 180,090 Integrated Team Solutions SJHC 5 .946%, 2042-11-30 CAD 53,840 54,220 68,320 Laurentian Bank of Canada 2 .750%, 2021-04-22 CAD 105,000 104,776 106,602 Melancthon Wolfe Wind 3 .834%, 2028-12-31 CAD 117,250 117,264 118,883 North West Redwater Partnership Series A, 3 .200%, 2024-07-22 CAD 195,000 195,135 203,490 3 .200%, 2026-04-24 CAD 94,000 93,800 96,873 Series F, 4 .250%, 2029-06-01 CAD 110,000 109,694 119,353 Northland Power Solar Finance Limited Partnership Series A, 4 .958%, 2032-12-31 CAD 135,732 135,741 157,669 Plenary Health Care Partnerships Humber 4 .895%, 2039-05-31 CAD 128,411 128,411 148,068 Plenary Properties 6 .288%, 2044-01-31 CAD 273,622 328,057 369,550 Reliance Series 1, 4 .574%, 2017-03-15 CAD 69,000 69,000 69,990 Series 2, 5 .187%, 2019-03-15 CAD 149,000 149,000 156,921 Royal Bank of Canada 2 .364%, 2017-09-21 CAD 710,000 702,201 720,394 2 .260%, 2018-03-12* CAD 202,000 205,828 205,373 1 .400%, 2019-04-26 CAD 395,000 394,874 396,453 2 .860%, 2021-03-04 CAD 211,000 210,973 222,832 2 .030%, 2021-03-15 CAD 310,000 309,882 315,935 3 .040%, (floating rate from 2019-07-17), 2024-07-17 CAD 61,000 60,989 61,274 2 .990%, (floating rate from 2019-12-06), 2024-12-06 CAD 439,000 440,409 452,176 2 .480%, (floating rate from 2020-06-04), 2025-06-04 CAD 295,000 294,944 290,037 3 .310%, (floating rate from 2021-01-20), 2026-01-20 CAD 20,000 20,294 20,265 Scotiabank 2 .370%, 2018-01-11 CAD 321,000 319,058 326,427 3 .270%, 2021-01-11 CAD 325,000 351,302 348,449 2 .898%, (floating rate from 2017-08-03), 2022-08-03 CAD 512,000 517,363 517,933 3 .367%, (floating rate from 2020-12-08), 2025-12-08* CAD 482,000 482,000 489,116 SGTP Highway Bypass Series A, 4 .105%, 2045-01-31 CAD 164,000 164,000 173,445 SNC-Lavalin Innisfree McGill Finance 6 .632%, 2044-06-30 CAD 134,436 156,200 180,945 Teranet Holdings 3 .646%, 2022-11-18 CAD 110,000 110,000 116,196





Teranet Income Fund 5 .754%, 2040-12-17 CAD 62,000 62,000 73,770 6 .100%, 2041-06-17 CAD 477,000 530,626 603,664 Toronto-Dominion Bank 1 .680%, 2021-06-08 CAD 100,000 99,962 100,813 3 .226%, 2024-07-24* CAD 159,000 159,834 173,969 2 .692%, (floating rate from 2020-06-24), 2025-06-24 CAD 161,000 161,000 159,774 2 .982%, (floating rate from 2020-09-30), 2025-09-30* CAD 142,000 142,000 142,351 4 .859%, 2031-03-04 CAD 106,000 107,499 116,052 4 .779%, (floating rate from 2016-12-14), 2105-12-14 CAD 533,000 553,240 539,899 5 .763%, (floating rate from 2017-12-18), 2106-12-18 CAD 263,000 293,076 277,301 TransCanada PipeLines 8 .050%, 2039-02-17 CAD 121,000 192,202 188,681

15,145,249 15,666,769

TOTAL CANADIAN BONDS 36,099,577 38,031,294

U.S. Bonds (0.0%)Sinai Health System Series A, 3 .527%, 2056-06-09 CAD 55,000 55,000 56,959

TOTAL BONDS 36,154,577 38,088,253

Number of Units

INVESTMENT FUND (21.2%)Fiera Global Equity Fund 2,360,463 25,687,688 38,049,347

Par Value

MONEY MARKET SECURITIES (13.8%)Canada Treasury Bills 2016-07-05 CAD 2,780,000 2,779,209 2,779,209 2016-07-14 CAD 155,000 154,826 154,826 2016-07-28 CAD 4,300,000 4,294,549 4,294,549 2016-08-25 CAD 1,800,000 1,798,485 1,798,485 2016-09-08 CAD 6,180,000 6,174,314 6,174,314 Ontario Treasury Bills 2016-07-13 CAD 2,850,000 2,848,262 2,848,262 Province of British Columbia, notes 2016-07-11 CAD 2,950,000 2,948,348 2,948,348 Province of Saskatchewan, notes 2016-07-27 CAD 2,000,000 1,999,020 1,999,020 Québec Treasury Bills 2016-08-26 CAD 1,725,000 1,722,930 1,722,930

TOTAL MONEY MARKET SECURITIES 24,719,943 24,719,943






Par Fair Value Cost Value $ $MORTGAGE-BACKED SECURITIES (0.1%)

Merrill Lynch Financial Assets 4 .642%, 2016-10-12 CAD 400,000 159,861 173,439 Series 2007-CA22, Class A3, 4 .878%, 2017-04-12 CAD 50,000 45,800 50,922 Merrill Lynch Mortgage Loans 4 .711%, 2016-11-12 CAD 200,000 3,802 4,113

TOTAL MORTGAGE-BACKED SECURITIES 209,463 228,474

ASSET-BACKED SECURITIES (0.1%) CHIP Mortgage Trust 3 .663%, 2038-09-25 CAD 186,000 186,000 193,824

PORTFOLIO TRANSACTION COSTS INCLUDED IN THE SECURITIES’ COST (60,573) —


OTHER NET ASSETS (-0.7%) (1,266,941)

NET ASSETS (100%) 179,388,975


TOP FIVE HOLDINGS OF THE UNDERLYING FUND – unaudited


FIERA GLOBAL EQUITY FUND 21.2%Moody’s Corporation 4 .2%Johnson & Johnson 4 .2%Becton, Dickinson and Company 4 .1%Keyence Corporation 4 .0%Nestlé 3 .3%




Investment ObjectiveTo provide investors with a balance of capital growth and interest income by investing primarily in Canadian fixed income and equity securities .

Investment StrategyTo provide such a balance by investing a portion of its assets in the common shares of medium and large cap Canadian corporations and the remainder in Canadian government and Canadian investment-grade corporate bonds and other interest-bearing instruments .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLEquities 79,376,075 — — 79,376,075 Bonds 21,041,171 17,047,082 — 38,088,253 Investment Funds — 38,049,347 — 38,049,347 Mortgage-Backed Securities — 228,474 — 228,474 Asset-Backed Securities — 193,824 — 193,824 Money Market Securities 24,719,943 — — 24,719,943 TOTAL 125,137,189 55,518,727 — 180,655,916


Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLEquities 84,558,071 — — 84,558,071 Bonds 21,704,615 17,849,045 — 39,553,660 Investment Funds — 45,021,231 — 45,021,231 Mortgage-Backed Securities — 311,077 — 311,077 Asset-Backed Securities — 195,326 — 195,326 Money Market Securities 13,248,173 — — 13,248,173 TOTAL 119,510,859 63,376,679 — 182,887,538


Classification of Level 3As at June 30, 2016 and December 31, 2015, the Fund has no financial instruments classified within Level 3 .





Reconciliation of Level 3 Fair Value MeasurementThe following table summarizes a reconciliation of movements on Level 3 financial instruments between the beginning and end of the period:

June 30, 2016 Equities $

Balance, Beginning of Period — Proceeds from sale of investments — Investments purchased 2,799,168 Net realized gain (loss) — Net unrealized gain (loss) — Transfers to (from) Level 3 (2,799,168) Balance, End of Period —

Certain securities classified as Level 3 entailed restrictions . In April 2016, these securities valued at approximately $2,799,000 were transferred from Level 3 to Level 1 following the expiration of the restrictions . These securities are now valued at the quoted prices on the active markets .



Currency RiskAs at June 30, 2016 and December 31, 2015, part of the Net Assets Attributable to Contract Owners are invested in an underlying fund which may be exposed to currency risk . As a result, the Fund may be exposed to currency risk related to the current underlying fund . Detailed disclosure about the currency risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .As at June 30, 2016 and December 31, 2015, the majority of the Fund’s financial assets and liabilities are denominated in Canadian dollars . As a result, the Fund is not significantly exposed to currency risk .

Interest Rate RiskPart of the Net Assets Attributable to Contract Owners are invested in an underlying fund which may be exposed to interest rate risk . As a result, the Fund may be exposed to interest rate risk related to the current underlying fund . Detailed disclosure about the interest rate risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .The following table summarizes the Fund’s exposure to interest rate risk . It includes the Fund’s financial assets and liabilities at fair value, categorized by the earlier of contractual re-pricing or maturity dates . The table also illustrates the impact on the Net Assets Attributable to Contract Owners, had prevailing interest rates changed by 0 .25%, assuming a parallel shift in the yield curve, with all other variables held constant .

Less than 1 Year

$1 to 5 Years

$5 to 10 Years

$

Greater than 10 Years

$Total

$

Impact on Net Assets Attributable to

Contract Owners$

June 30, 2016 26,458,072 12,966,093 11,305,078 12,513,218 63,242,461 728,947 December 31, 2015 15,605,259 15,537,608 10,556,269 11,608,315 53,307,451 684,204




Concentration RiskPart of the Net Assets Attributable to Contract Owners are invested in an underlying fund which is exposed to concentration risk . As a result, the Fund is exposed to concentration risk related to the current underlying fund . Detailed disclosure about the concentration risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .The following table summarizes the concentration risk, as a percentage of the Net Assets Attributable to Contract Owners:


Equities Financials 15 .1 Energy 8 .3 Materials 7 .1 Consumer Discretionary 4 .7 Industrials 4 .2 Consumer Staples 2 .6 Information Technology 1 .5 Utilities 0 .5 Health Care 0 .2 Bonds Provincial Governments and Crown Corporations 8 .9 Corporations 8 .8 Government of Canada 3 .6 Growth Investment Fund 21 .2 Money Market Securities 13 .8 Mortgage-Backed Securities 0 .1 Asset-Backed Securities 0 .1 Other Net Assets (0 .7)TOTAL 100




Equities Financials 17 .3 Energy 7 .9 Materials 6 .3 Industrials 4 .5 Consumer Staples 2 .7 Consumer Discretionary 2 .3 Information Technology 2 .1 Health Care 1 .3 Telecommunication Services 1 .2 Growth Investment Fund 24 .3 Bonds Corporations 8 .9 Provincial Governments and Crown Corporations 8 .2 Government of Canada 4 .3 Money Market Securities 7 .2 Mortgage-Backed Securities 0 .2 Asset-Backed Securities 0 .1 Other Net Assets 1 .2 TOTAL 100

Price RiskThe Fund may trade in financial instruments and take positions in traded and over-the-counter instruments .Part of the Net Assets Attributable to Contract Owners are invested in an underlying fund which is exposed to price risk . As a result, the Fund is exposed to price risk related to the current underlying fund . Detailed disclosure about the price risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .The Manager's estimate of the impact on Net Assets Attributable to Contract Owners as a result of a reasonably possible change in benchmarks, using a historical beta coefficient (a measure of the sensitivity of a security in comparison to the market) between the Fund’s return as compared to the return of the Fund’s benchmarks, with all other variables held constant, is included in the following table . A 36-month regression analysis has been utilized to estimate the historical beta coefficient . The regression analysis uses data based on the monthly returns of the Fund .


%


June 30, 2016 $


$FTSE TMX Canada 91 Day Treasury Bills (10%) 0 .25 48,978 47,580FTSE TMX Canada Universe (30%) 1 .00 587,733 570,958S&P/TSX Capped (40%) 3 .00 2,350,931 2,283,832MSCI World Net (20%) 3 .00 1,175,465 1,141,916




Credit RiskPart of the Net Assets Attributable to Contract Owners are invested in an underlying fund which may be exposed to credit risk . As a result, the Fund may be exposed to credit risk related to the current underlying fund . Detailed disclosure about the credit risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .The Fund’s credit risk concentration is separated between fixed-income and money market securities . Their fair values include consideration of the issuers' creditworthiness and accordingly, represent the Fund’s maximum exposure to credit risk .

Portfolio's Fixed-Income Securities by Credit Rating Category

Credit Rating Percentage of Fixed-Income Securities

June 30, 2016%

Percentage of Fixed-Income Securities

December 31, 2015%

AAA 20 22 AA 40 39 A 28 30 BBB 12 9 TOTAL 100 100

Portfolio's Money Market Securities by Credit Rating Category

Credit Rating Percentage of Money Market Securities

June 30, 2016%

Percentage of Money Market Securities

December 31, 2015%

R-1 (High) 82 62 R-1 (Middle) 18 38 TOTAL 100 100

Securities Lending and Repurchase TransactionsAs part of its securities lending cash counter and repurchase transactions, the Fund is exposed to counterparty credit risk .The carrying amount of financial assets lent as part of repurchase transactions is:

$June 30, 2016 10,269,940 December 31, 2015 5,688,216

The fair value of the financial assets held as collateral that the Fund is permitted to sell or repledge in the absence of default totalled:

$June 30, 2016 6,821,065 December 31, 2015 2,811,681

The fair value of financial assets accepted as collateral which have been sold or repledged totalled:

$June 30, 2016 11,342 December 31, 2015 —

These financial assets were received as collateral as part of transactions involving reverse repurchase transactions .



Liquidity RiskAs at June 30, 2016 and December 31, 2015, part of the Net Assets Attributable to Contract Owners are invested in an underlying fund which is exposed to liquidity risk . As a result, the Fund is exposed to liquidity risk related to the current underlying fund . Detailed disclosure about the liquidity risk on the underlying fund can be obtained from Desjardins Financial Security (see Note 7) .For further information on maturities of financial liabilities and liquidity risk management of the Fund, please refer to Note 7 “Financial Instruments Disclosures” .


Securities Lending and Repurchase TransactionsAs part of transactions involving securities lending or repurchase transactions, the Fund transfers financial assets under terms and conditions providing for their future repurchase . These financial assets remain recognized in the “Investments at fair value through profit or loss pledged as collateral” of the Statement of Financial Position as the Fund retains substantially all the risks and rewards related to these assets .

June 30, 2016$

December 31, 2015$

Investments at FVTPL pledged as Collateral 17,000,836 21,876,504 Value of Collateral received 17,341,173 22,314,035

The Funds require collateral in the form of cash or such other securities as may be acceptable to Desjardins Financial Security and that have an aggregate value of no less than 102% of the loaned securities fair value .The following table presents the carrying amount and the fair value of financial assets transferred by the Fund but not derecognized as well as the related liabilities recognized in “Commitments related to repurchase transactions” and “Commitments related to securities lending” of the Statement of Financial Position .

Fair Value* June 30, 2016

$

Fair Value* December 31, 2015

$Financial Assets 10,269,940 5,688,216 Related Liabilities 10,307,101 5,685,138

*The fair value equals the carrying amount .

RECONCILIATION OF INCOME FROM SECURITY LENDING AND REPURCHASE TRANSACTION (Note 2)The following table shows a reconciliation of the total income generated from securities lending transactions of the Fund and the revenue from securities lending and repurchase transactions disclosed in the Fund’s Statement of Comprehensive Income .

June 30, 2016$

June 30, 2016%

June 30, 2015$

June 30, 2015%

Total Income 16,778 100 22,166 100Net Income received by: DFS GIF – Canadian Balanced – Fiera Capital 10,067 60 13,300 60Desjardins Trust 6,711 40 8,866 40




June 30 2016

$

December 31 2015


or loss (FVTPL) 192,558,366 193,040,209 Premiums receivable 847,181 442,582 Receivable for securities sold — 68,041

193,517,223 193,550,832 LIABILITIESCurrent LiabilitiesBank overdraft — 67,886 Accrued expenses 436,756 441,042 Withdrawals payable 291,156 322,265 Payable for securities purchased 691,402 175,627





DFS GIF – CANADIAN BALANCED – FRANKLIN BISSETT


2016$

2015$

INCOMEInterest for attribution purposes (22) 2,262 Dividends — 75,390 Changes in fair value:

Net realized gain (loss) on investments 2,042,385 4,061,046 Net unrealized gain (loss) on investments 8,427,901 1,435,734

10,470,264 5,574,432


2,568,903 3,106,102 Withholding taxes — 2,262

2,568,903 3,108,364




Average Number of Units 921,134 1,136,751





from Operations 1,173,033 129,183 - per unit 0.23 0 .03








2016$

2015$




10,471,645 13,982,102

WithdrawalsSeries 3 (1,268,409) (1,174,074)Series 5 (15,546,559) (23,008,168)Series 6 (1,977,645) (2,064,530)Series 7 (26,496) (83,319)

(18,819,109) (26,330,091)


2016$

2015$





Investments purchased (2,280,146) (3,346,343)Receivable for securities sold 68,041 (45,430)Accrued expenses (4,286) (13,972)Payable for securities purchased 515,775 (156,501)







SUPPLEMENTAL INFORMATION ON CASH FLOWS FROM (USED IN) OPERATING ACTIVITIESInterest paid 22 —





DFS GIF – CANADIAN BALANCED – FRANKLIN BISSETT (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.2%)Franklin Bissett Canadian Balanced Fund, Series O 4,412,429 153,774,148 192,558,366



NET ASSETS (100%) 192,097,909




Franklin Bissett Canadian Equity Fund 19 .1%Franklin Bissett Corporate Bond Fund 14 .5%Franklin Bissett Core Plus Bond Fund 14 .0%Franklin Bissett Microcap Fund 6 .4%Franklin Bisset All Canadian Focus Fund 6 .1%Franklin Bissett Small Cap Fund 5 .9%Franklin Bissett Canadian Dividend Fund 5 .0%Franklin Bissett U .S . Focus Fund 4 .3%Franklin U .S . Rising Dividends Fund 4 .2%Templeton EAFE Developed Markets Fund 4 .1%Franklin Mutual Global Discovery Fund 3 .9%Franklin Bissett Monthly Income and Growth Fund 3 .1%Templeton Global Bond Fund 2 .7%Templeton Global Smaller Companies Fund 2 .3%Franklin Strategic Income Fund 2 .2%Templeton Emerging Markets Fund 1 .0%Franklin Bissett Canadian Short Term Bond Fund 0 .8%Cash and Cash Equivalents 0 .4%




Investment ObjectiveTo provide investors with a balance of current income and long-term capital appreciation primarily through the investment in Canadian fixed-income and equity securities .

Investment StrategyTo provide such an opportunity by investing in a diversified portfolio of Franklin Bissett mutual funds . The underlying funds may invest in foreign securities .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $









DFS GIF – CANADIAN BALANCED – FRANKLIN BISSETT (cont.)






%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (35%) 1 .00 649,133 621,058Barclays Capital U .S . Aggregate Bond (2 .5%) 1 .00 46,367 44,361J .P . Morgan Global Government Bond (2 .5%) 1 .00 46,367 44,361S&P/TSX Small Cap (5%) 3 .00 278,200 266,168S&P/TSX (32 .5%) 3 .00 1,808,300 1,730,090S&P 500 (10%) 3 .00 556,400 532,335MSCI EAFE Net (10%) 3 .00 556,400 532,335MSCI Emerging Markets Net (2 .5%) 3 .00 139,100 133,084

When there is more than one benchmark, the effect of each benchmark must be considered individually, as each benchmark might fluctuate independently from the others .





June 30 2016

$

December 31 2015



514,643,850 538,080,974 LIABILITIESCurrent LiabilitiesBank overdraft 126,525 178,117 Accrued expenses 1,267,455 1,320,670 Withdrawals payable 1,261,416 500,515 Payable for securities purchased 343,649 109,762





DFS GIF – BALANCED GROWTH – FRANKLIN QUOTENTIAL


2016$

2015$

INCOMEInterest for attribution purposes — —Changes in fair value:


(7,719,669) 40,123,747

EXPENSESManagement fees and guarantee charge 6,115,350 6,474,120 Operating expenses 1,487,686 1,609,065

7,603,036 8,083,185

















2016$

2015$




31,264,072 28,965,084

WithdrawalsSeries 3 (1,074,904) (1,539,604)Series 5 (37,735,660) (36,889,746)Series 6 (1,224,563) (563,295)Series 7 (233,345) (4,820)

(40,268,472) (38,997,465)


2016$

2015$





Investments purchased (3,695,166) (8,549,146)Receivable for securities sold (228,104) 454,301 Accrued expenses (53,215) 68,449 Payable for securities purchased 233,887 205,628







SUPPLEMENTAL INFORMATION ON CASH FLOWS FROM (USED IN) OPERATING ACTIVITIESInterest paid 1 —






Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.3%)Franklin Quotential Balanced Growth Portfolio 48,712,257 378,093,977 513,427,189


OTHER NET ASSETS (-0.3%) (1,782,384)

NET ASSETS (100%) 511,644,805




Franklin Bissett Core Plus Bond Fund 19 .7%Franklin U .S . Core Equity Fund 6 .1%Franklin Bissett Canadian Equity Fund 5 .9%Franklin U .S . Rising Dividends Fund 5 .8%Franklin Mutual European Fund 5 .4%Franklin Strategic Income Fund 4 .8%Templeton Global Bond Fund 4 .7%Templeton Asian Growth Fund 3 .8%Franklin Bisset All Canadian Focus Fund 3 .6%Franklin U .S . Opportunities Fund 3 .5%BMO Mid Federal Bond Index ETF 3 .3%Franklin Templeton Canadian Large Cap Fund 3 .0%iShares TIPS Bond ETF 2 .6%iShares Russell 1000 Value ETF 2 .2%Franklin Bissett Small Cap Fund 2 .1%Franklin Japan Fund 2 .1%iShares iBoxx High Yield Corporate Bond ETF 2 .0%SPDR Euro Stoxx 50 ETF 1 .9%WisdomTree Australia & New Zealand Debt ETF 1 .6%SPDR Gold Trust ETF 1 .5%Franklin European Small-Mid Cap Growth Fund 1 .4%Templeton Emerging Markets Smaller Companies Fund 1 .3%iShares MSCI Japan ETF 1 .0%iShares MSCI Japan Small-Cap ETF 0 .9%Franklin India Fund 0 .7%


DFS GIF – BALANCED GROWTH – FRANKLIN QUOTENTIAL (cont.)





Investment StrategyTo emphasize investments in equity underlying funds in order to increase the potential for capital appreciation over a longer investment horizon . The Fund also invests, to a lesser extent, in fixed income underlying funds in order to provide stability .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (30%) 1 .00 1,789,873 1,721,526Barclays Capital Multiverse (10%) 1 .00 596,624 573,842S&P/TSX (30%) 3 .00 5,369,620 5,164,579MSCI All Country World Net (30%) 3 .00 5,369,620 5,164,579





DFS GIF – BALANCED GROWTH – FRANKLIN QUOTENTIAL (cont.)


June 30 2016

$

December 31 2015



108,197,034 110,828,579 LIABILITIESCurrent LiabilitiesBank overdraft 12,829 32,321 Accrued expenses 260,942 269,081 Withdrawals payable 107,805 358,326 Payable for securities purchased 21,304 —





DFS GIF – CANADIAN BALANCED – CI SIGNATURE


2016$

2015$


Net realized gain (loss) on investments (171,086) 256,856 Net unrealized gain (loss) on investments 212,739 2,864,259

41,653 3,121,115


1,553,557 1,570,362














2016$

2015$



PremiumsSeries 5 4,639,896 10,830,363 Series 6 3,556,807 8,904,148 Series 7 452,302 690,527

8,649,005 20,425,038

WithdrawalsSeries 5 (7,142,266) (7,151,627)Series 6 (2,112,250) (1,082,988)Series 7 (257,282) (41,949)

(9,511,798) (8,276,564)


2016$

2015$



Adjustments for:Net realized gain (loss) 171,086 (256,856)Net unrealized gain (loss) (212,739) (2,864,259)


Investments purchased (3,422,160) (13,361,281)Receivable for securities sold 167,682 698 Accrued expenses (8,139) 41,527 Payable for securities purchased 21,304 (248,388)

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 809,229 (12,561,444)










DFS GIF – CANADIAN BALANCED – CI SIGNATURE (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.3%)Signature Canadian Balanced Fund, Class I 11,714,846 108,699,431 108,128,030



NET ASSETS (100%) 107,794,154




SPDR Gold Shares 6 .8%Scotiabank 2 .2%Toronto-Dominion Bank 1 .8%Royal Bank of Canada 1 .8%Province of Quebec, 4 .50%, December 1, 2019 1 .3%Alimentation Couche-Tard 1 .3%Province of Ontario, 3 .50%, June 2, 2024 1 .2%Province of Quebec, 4 .30%, December 1, 2021 1 .2%Province of Ontario, 4 .20%, June 2, 2020 1 .1%Citigroup 1 .1%Manulife Financial Corporation 1 .0%Roche Holding AG 1 .0%Province of Quebec, 2 .80%, September 1, 2025 1 .0%Province of Ontario, 3 .20%, June 2, 2022 1 .0%Province of British Columbia, 3 .20%, June 18, 2024 0 .9%Province of Ontario, 2 .90%, December 2, 2046 0 .9%Canadian National Railway Company 0 .9%Province of Ontario, 4 .00%, June 2, 2021 0 .9%TransCanada Corporation 0 .9%Sony Corporation 0 .8%Enbridge 0 .8%Suncor Energy 0 .8%Thermo Fisher Scientific 0 .8%Saputo 0 .8%Nestlé SA 0 .7%




Investment ObjectiveTo provide investors with an attractive balance of current income and capital appreciation by investing primarily in a combination of Canadian equity and equity-related securities and fixed income securities .

Investment StrategyFor the equity portion, the Fund invests primarily in companies providing a stable income or consistent dividends . For the fixed income portion, the portfolio advisor selects high-quality fixed income securities, including bank loans and floating rate debt instruments but may choose to shift the weighting of the portion of the Fund held in bonds with longer terms to maturity depending on the expected fluctuations in interest rates . The Fund may also invest in foreign securities as well as warrants, and derivatives, the latter to aid in hedging against potential losses resulting from changes in the prices of the securities that the Fund has invested in as well as any exposure from foreign currencies .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $








DFS GIF – CANADIAN BALANCED – CI SIGNATURE (cont.)







%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (40%) 1 .00 373,091 387,077S&P/TSX (30%) 3 .00 839,454 870,924MSCI All Country World Net (30%) 3 .00 839,454 870,924

When there is more than one benchmark, the effect of each benchmark must be considered individually, as each benchmark might fluctuate independently from the others .





June 30 2016

$

December 31 2015


or loss (FVTPL) 65,491,251 69,141,832 Premiums receivable 437,229 232,269 Receivable for securities sold 973 28,314

65,933,978 69,402,415 LIABILITIESCurrent LiabilitiesBank overdraft — 3,897 Accrued expenses 161,018 170,206 Withdrawals payable 74,149 82,672 Payable for securities purchased 393,322 6,603





DFS GIF – INCOME AND GROWTH – CI SIGNATURE


2016$

2015$


Net realized gain (loss) on investments 1,098,866 1,443,858 Net unrealized gain (loss) on investments (2,074,072) (83,027)

239,262 2,364,471


972,129 990,767

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS (732,867) 1,373,704


from Operations (574,915) 1,267,617 - per unit (0.08) 0 .15











2016$

2015$


from operations attributable to contract owners (732,867) 1,373,704


6,378,366 15,155,669

WithdrawalsSeries 5 (7,984,887) (5,020,712)Series 6 (1,237,132) (616,060)Series 7 (257,028) (38,104)

(9,479,047) (5,674,876)


2016$

2015$



Adjustments for:Net realized gain (loss) (1,098,866) (1,443,858)Net unrealized gain (loss) 2,074,072 83,027


Investments purchased (3,875,795) (12,369,442)Receivable for securities sold 27,341 (4,744)Accrued expenses (9,188) 30,309 Payable for securities purchased 386,719 40,586

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 3,322,586 (9,484,875)


NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES (3,314,164) 9,478,626



CASH (BANK OVERDRAFT), END OF PERIOD 4,525 836






Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.3%)Signature Income & Growth Fund, Class I 7,165,345 67,532,003 65,491,251



NET ASSETS (100%) 65,305,489




SPDR Gold Shares 6 .8%Scotiabank 2 .1%Toronto-Dominion Bank 1 .8%Royal Bank of Canada 1 .8%Alimentation Couche-Tard 1 .1%Singapore Telecommunications 1 .1%Citigroup 1 .0%Manulife Financial Corporation 1 .0%Canadian National Railway Company 0 .9%Suncor Energy 0 .8%TransCanada Corporation 0 .8%Roche Holding AG 0 .8%Enbridge 0 .8%Province of Ontario, 4 .00%, June 2, 2021 0 .8%Province of Quebec, 4 .50%, December 1, 2019 0 .8%Saputo 0 .7%JPMorgan Chase & Company 0 .7%Bristol-Myers Squibb Company 0 .7%Loblaw Companies 0 .7%Province of Ontario, 4 .20%, June 2, 2020 0 .7%Telstra Corporation Ltd 0 .7%Province of Quebec, 4 .25%, December 1, 2021 0 .7%Total SA 0 .7%Nestlé SA 0 .6%Sony Corporation 0 .6%


DFS GIF – INCOME AND GROWTH – CI SIGNATURE (cont.)




Investment ObjectiveThe objective of this Fund is to provide a steady flow of current income while preserving capital by obtaining exposure primarily to equity, equity related and fixed income securities of Canadian issuers .

Investment StrategyThe Fund invests in a combination of equity, fixed income and derivatives . Broadly diversified by sector and style, preferred and common shares make up portions of the Fund’s investments in equity securities . The fixed income portion of the Fund’s investments is comprised of high-yielding government and corporate bonds, debentures and notes, including some securities that are unrated or have credit ratings below investment grade . The Fund may also invest in real estate investment trusts (REITs), royalty trusts, income trusts and other similar high yielding instruments .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (15%) 1 .00 79,488 86,164Merrill Lynch High Yield Master II (15%) 2 .00 158,976 172,328S&P/TSX Composite High Dividend (10%) 3 .00 158,976 172,328S&P/TSX (30%) 3 .00 476,929 516,985MSCI All Country World Net (30%) 3 .00 476,929 516,985





DFS GIF – INCOME AND GROWTH – CI SIGNATURE (cont.)


June 30 2016

$

December 31 2015


or loss (FVTPL) 152,441,242 154,530,284 Premiums receivable 498,758 17,148 Receivable for securities sold — 31,307






DFS GIF – GROWTH AND INCOME – NEI NORTHWEST


2016$

2015$

INCOMEDividends 1,328,943 2,519,657 Changes in fair value:

Net realized gain (loss) on investments 1,763,061 2,451,644 Net unrealized gain (loss) on investments (333,761) 2,368,064

2,758,243 7,339,365



2,235,705 2,431,859

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 522,538 4,907,506





from Operations 393,420 4,646,737 - per unit 0.02 0 .19











2016$

2015$




11,104,172 9,035,177

WithdrawalsSeries 3 (304,472) (338,319)Series 5 (12,476,255) (12,286,962)Series 6 (930,721) (1,105,233)Series 7 (9,111) (3,802)

(13,720,559) (13,734,316)


2016$

2015$



Adjustments for:Net realized gain (loss) (1,763,061) (2,451,644)Net unrealized gain (loss) 333,761 (2,368,064)


Investments purchased (3,942,862) (4,473,840)Receivable for securities sold 31,307 —Accrued expenses (6,490) 6,600 Payable for securities purchased 304,440 (76,838)











DFS GIF – GROWTH AND INCOME – NEI NORTHWEST (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.1%)NEI Northwest Growth and Income Fund, Series I 23,130,452 113,952,360 152,441,242



NET ASSETS (100%) 152,361,408




NEI Northwest Global Equity Fund 35 .3%NEI Canadian Bond Fund 23 .8%Toronto-Dominion Bank 3 .7%Québecor 2 .4%Onex Corporation 2 .3%Rogers Communications 2 .2%Canadian Imperial Bank of Commerce 2 .2%TELUS Corporation 2 .1%BCE 2 .1%FirstService Corporation 2 .1%Sun Life Financial 2 .0%Manulife Financial Corporation 2 .0%Thomson Reuters Corporation 2 .0%Granite Real Estate Investment Trust 1 .8%Colliers International Group 1 .6%Scotiabank 1 .5%Magna International 1 .4%Bombardier 1 .3%Allied Properties Real Estate Investment 1 .1%Vermilion Energy 0 .9%Pason Systems 0 .8%Bonterra Energy 0 .8%Precision Drilling Corporation 0 .7%Equitable Group 0 .6%NorthWest Healthcare Properties Real Estate Investment Trust 0 .6%




Investment ObjectiveTo provide a consistent stream of income and capital appreciation by investing primarily in a mix of Canadian equities and fixed-income securities .

Investment StrategyTo invest in a diversified portfolio consisting primarily of a balance of large cap equity and investment grade fixed-income securities issued principally by Canadian issuers .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $









DFS GIF – GROWTH AND INCOME – NEI NORTHWEST (cont.)






%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (25%) 1 .00 335,732 316,410S&P/TSX (55%) 3 .00 2,215,832 2,088,309MSCI World Net (20%) 3 .00 805,757 759,385





June 30 2016

$

December 31 2015


or loss (FVTPL) 84,826,646 83,962,666 Premiums receivable 82,830 —Receivable for securities sold 664,389 69,564






DFS GIF – GLOBAL GROWTH – NEI SELECT


2016$

2015$


Net realized gain (loss) on investments (65,244) 886,772 Net unrealized gain (loss) on investments 675,934 4,147,190

610,690 5,033,962

EXPENSESManagement fees and guarantee charge 1,078,006 999,901 Operating expenses 231,847 230,694

1,309,853 1,230,595

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS (699,163) 3,803,367





from Operations (591,796) 3,479,250 - per unit (0.07) 0 .39






from Operations 640 8,013 - per unit — 0 .21





2016$

2015$




8,392,259 6,733,738

WithdrawalsSeries 3 (346,984) (390,071)Series 5 (4,984,342) (3,959,230)Series 6 (1,497,177) (146,647)Series 7 (76,108) (3,846)

(6,904,611) (4,499,794)


2016$

2015$



Adjustments for:Net realized gain (loss) 65,244 (886,772)Net unrealized gain (loss) (675,934) (4,147,190)


Investments purchased (4,264,345) (3,778,807)Receivable for securities sold (594,825) (6,667)Accrued expenses 6,213 19,199 Payable for securities purchased 3,644 3,271












Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.3%)NEI Select Growth Portfolio, Series I 7,946,364 84,805,242 84,826,646



NET ASSETS (100%) 84,548,937




NEI Northwest Global Equity Fund 13 .0%NEI Ethical Global Equity Fund 12 .8%NEI Ethical International Equity Fund 12 .2%NEI Northwest U .S . Dividend Fund 12 .1%NEI Northwest Specialty Global High Yield Bond Fund 8 .3%NEI Northwest Macro Canadian Asset Allocation Fund 8 .3%NEI Northwest Specialty Equity Fund 8 .2%NEI Global Total Return Bond Fund 7 .6%NEI Northwest Emerging Markets Fund 7 .1%NEI Northwest Canadian Dividend Fund 4 .2%NEI Northwest Canadian Equity Fund 4 .2%NEI Canadian Bond Fund 1 .9%Cash and Cash Equivalents 0 .1%


DFS GIF – GLOBAL GROWTH – NEI SELECT (cont.)




Investment ObjectiveTo provide a balance of capital growth and interest income by investing primarily in units of individual underlying funds in order to gain the desired exposure to the equity and fixed income markets .

Investment StrategyTo emphasize investments in equity underlying funds in order to increase the potential for capital appreciation over a longer investment horizon . The Fund also invests to a lesser extent, in fixed income underlying funds in order to provide income and capital preservation .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (30%) 1 .00 251,520 254,650S&P/TSX (14%) 3 .00 352,128 356,509MSCI World Net (56%) 3 .00 1,408,510 1,426,037





DFS GIF – GLOBAL GROWTH – NEI SELECT (cont.)


June 30 2016

$

December 31 2015

$ASSETSCurrent AssetsCash — 340 Investments at fair value through profit

or loss (FVTPL) 12,225,986 10,642,981 Premiums receivable 15,318 173,108 Receivable for securities sold 2,757 150






DFS GIF – CANADIAN ASSET ALLOCATION – CI CAMBRIDGE


2016$

2015$

INCOMEDividends 51,867 32,062 Changes in fair value:

Net realized gain (loss) on investments 535,335 254,810 Net unrealized gain (loss) on investments (231,108) 56,480

356,094 343,352


161,219 110,171














2016$

2015$



PremiumsSeries 5 422,771 816,100 Series 6 1,668,441 1,501,807 Series 7 311,497 2,000

2,402,709 2,319,907

WithdrawalsSeries 5 (399,773) (640,789)Series 6 (383,316) (132,770)Series 7 (224,505) —

(1,007,594) (773,559)


2016$

2015$



Adjustments for:Net realized gain (loss) (535,335) (254,810)Net unrealized gain (loss) 231,108 (56,480)


Investments purchased (1,943,078) (1,999,673)Receivable for securities sold (2,607) (21,162)Accrued expenses 4,375 4,354 Payable for securities purchased (150,133) 9,901





Cash (bank overdraft), beginning of period 340 2,001






DFS GIF – CANADIAN ASSET ALLOCATION – CI CAMBRIDGE (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.1%)Cambridge Canadian Asset Allocation Corporate Class, I Shares 683,398 11,537,016 12,225,986



NET ASSETS (100%) 12,207,996




Cambridge Bond Fund 21 .5%Walgreens Boots Alliance 2 .7%Tourmaline Oil Corporation 2 .6%Brookfield Infrastructure Partners 2 .6%U .S . Treasury Bill, 1 .63%, May 15, 2026 2 .5%U .S . Treasury Bill, 1 .13%, June 30, 2021 2 .5%Keyera Corporation 2 .2%U .S . Treasury Bill, 1 .75%, May 15, 2023 1 .9%Canadian Pacific Railway 1 .7%Silver Wheaton Corporation 1 .7%Chubb Ltd 1 .6%Brookfield Renewable Partners 1 .6%Abertis Infraestructuras 1 .4%Franco-Nevada Corporation 1 .4%PrairieSky Royalty Ltd 1 .4%Synchrony Financial 1 .4%Alphabet 1 .3%Computer Sciences Corporation 1 .3%George Weston 1 .2%Restaurant Brands International 1 .2%Tesco Corporation 1 .1%Extended Stay America 1 .1%Morgan Stanley 1 .1%Amgen 1 .0%Signature Bank 0 .9%




Investment ObjectiveThe objective of this Fund is to achieve a superior total investment return directly or indirectly, in a combination of primarily equity and fixed income securities of Canadian companies . Indirect investments may include convertible securities, derivatives, equity-related securities and securities of other mutual funds .

Investment StrategyThe Fund is actively managed with a disciplined bottom-up selection process . The strategy uses exposure in equity, fixed income instruments and cash and cash equivalents to achieve the Fund objective . The investments in each asset class will vary dependent on market conditions . The Canadian fixed income securities portion of the portfolio will consist mainly of high quality government and corporate bonds while foreign securities can make up part of the equity portion of the portfolio .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $








DFS GIF – CANADIAN ASSET ALLOCATION – CI CAMBRIDGE (cont.)







%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (40%) 1 .00 33,095 28,128S&P/TSX (60%) 3 .00 148,928 126,578





June 30 2016

$

December 31 2015



54,878,254 60,663,284 LIABILITIESCurrent LiabilitiesBank overdraft 1,147 4,124 Accrued expenses 147,511 162,279 Withdrawals payable 58,395 41,466 Payable for securities purchased — 3,566





DFS GIF – GROWTH – FRANKLIN QUOTENTIAL


2016$

2015$



(1,879,530) 5,537,944


897,391 1,018,736

















2016$

2015$



PremiumsSeries 3 257,496 74,311 Series 5 819,231 804,953 Series 6 484,075 1,363,159 Series 7 — 3,146

1,560,802 2,245,569

WithdrawalsSeries 3 (212,478) (371,738)Series 5 (4,101,610) (3,428,688)Series 6 (250,378) (180,033)Series 7 (63) —

(4,564,529) (3,980,459)


2016$

2015$





Investments purchased (492,028) (808,249)Receivable for securities sold (16,141) 18,016 Accrued expenses (14,768) 9,202 Payable for securities purchased (3,566) 22,888












DFS GIF – GROWTH – FRANKLIN QUOTENTIAL (cont.)


Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.3%)Franklin Quotential Growth Portfolio 5,462,658 37,114,867 54,845,087



NET ASSETS (100%) 54,671,201




Franklin Bissett Core Plus Bond Fund 11 .9%Franklin U .S . Core Equity Fund 8 .3%Franklin U .S . Rising Dividends Fund 7 .9%Franklin Mutual European Fund 7 .2%Franklin Bissett Canadian Equity Fund 6 .9%Templeton Asian Growth Fund 4 .9%Franklin U .S . Opportunities Fund 4 .8%Franklin Bisset All Canadian Focus Fund 4 .3%Franklin Templeton Canadian Large Cap Fund 3 .4%iShares Russell 1000 Value ETF 3 .0%Franklin Strategic Income Fund 2 .9%Franklin Japan Fund 2 .8%Templeton Global Bond Fund 2 .8%Franklin Bissett Small Cap Fund 2 .4%S&P Depositary Receipt EURO STOXX 50 ETF 2 .3%BMO Mid Federal Bond Index ETF 2 .0%Franklin European Small-Mid Cap Growth Fund 1 .8%Templeton Emerging Markets Fund 1 .8%iShares TIPS Bond ETF 1 .6%S&P Depositary Receipt Gold Trust ETF 1 .5%iShares MSCI Japan ETF 1 .3%iShares MSCI Japan Small-Cap ETF 1 .3%iShares iBoxx High Yield Corporate Bond ETF 1 .2%iShares S&P/TSX 60 Index ETF 1 .0%WisdomTree Australia & New Zealand Debt ETF 1 .0%





Investment StrategyTo emphasize investments in a diversified mix of equity underlying funds in order to increase the potential for capital appreciation over a longer investment horizon . The Fund also invests, to a lesser extent, in fixed income underlying funds in order to provide income and capital preservation .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (15%) 1 .00 92,271 95,555Barclays Capital Multiverse (5%) 1 .00 30,757 31,852S&P/TSX (35%) 3 .00 645,898 668,886MSCI All Country World Net (45%) 3 .00 830,441 859,996





DFS GIF – GROWTH – FRANKLIN QUOTENTIAL (cont.)


June 30 2016

$

December 31 2015



192,650,678 196,945,976 LIABILITIESCurrent LiabilitiesBank overdraft — 52,415 Accrued expenses 482,421 494,769 Withdrawals payable 370,829 205,254 Payable for securities purchased — 8,673




Canadian Equity

DFS GIF – DIVIDEND INCOME – FRANKLIN BISSETT


2016$

2015$

INCOMEDividends 2,605,732 1,674,651 Changes in fair value:

Net realized gain (loss) on investments 866,599 3,498,019 Net unrealized gain (loss) on investments 12,617,136 (6,878,940)

16,089,467 (1,706,270)


2,859,645 2,106,656

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 13,229,822 (3,812,926)


from Operations 2,549,009 (867,069)- per unit 0.73 (0 .33)



from Operations 10,206,428 (2,793,316)- per unit 0.79 (0 .32)











2016$

2015$


from operations attributable to contract owners 13,229,822 (3,812,926)

PremiumsSeries 3 586,988 865,761 Series 5 2,479,706 4,342,637 Series 6 711,931 1,326,776 Series 7 120,392 107,831

3,899,017 6,643,005

WithdrawalsSeries 3 (4,720,467) (3,846,614)Series 5 (16,372,082) (14,564,766)Series 6 (417,716) (501,827)Series 7 (6,011) (215,677)

(21,516,276) (19,128,884)


2016$

2015$



Adjustments for:Net realized gain (loss) (866,599) (3,498,019)Net unrealized gain (loss) (12,617,136) 6,878,940


Investments purchased (2,717,617) (1,723,432)Receivable for securities sold (9,369) (362,145)Accrued expenses (12,348) (28,439)Payable for securities purchased (8,673) (22,157)










Canadian Equity

DFS GIF – DIVIDEND INCOME – FRANKLIN BISSETT (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.2%)Franklin Bissett Dividend Income Fund, Series O 4,929,602 173,365,231 192,254,246



NET ASSETS (100%) 191,797,428




Canadian Imperial Bank of Commerce 3 .8%Royal Bank of Canada 3 .7%Toronto-Dominion Bank 3 .7%Bank of Montreal 2 .9%Scotiabank 2 .9%Enbridge 2 .8%Enbridge Income Fund Holdings 2 .5%IGM Financial 2 .5%Canadian National Railway Company 2 .2%Power Financial Corporation 2 .1%Inter Pipeline 2 .1%Brookfield Renewable Energy Partners 1 .8%Capital Power Corporation 1 .8%Russel Metals 1 .8%Fortis 1 .8%Rogers Communications 1 .7%ARC Resources 1 .6%Johnson & Johnson 1 .6%MacDonald, Dettwiler and Associates Ltd 1 .6%General Mills Inc . 1 .5%McDonald’s Corporation 1 .4%Brookfield Property Partners 1 .4%TELUS Corporation 1 .4%RioCan Real Estate Investment Trust 1 .4%The Kraft Heinz Company 1 .4%




Investment ObjectiveTo provide the investor with a consistent return through investment in dividend paying common shares and preferred shares .

Investment StrategyTo invest in a diversified portfolio of large cap Canadian issuer preferred shares and common shares as well as common shares of large cap United States issuers with long histories of dividend growth . From time to time the Fund also invests in investment grade interest-bearing securities to a maximum of 25% of the total assets of the Fund .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $








Canadian Equity

DFS GIF – DIVIDEND INCOME – FRANKLIN BISSETT (cont.)






%


June 30, 2016 $


December 31, 2015 $

FTSE TMX Canada Universe (15%) 1 .00 281,764 281,079S&P/TSX Preferred Share (5%) 3 .00 281,764 281,079S&P/TSX (60%) 3 .00 3,381,173 3,372,944S&P 500 (20%) 3 .00 1,127,058 1,124,315





June 30 2016

$

December 31 2015







Canadian Equity

DFS GIF – CANADIAN DIVIDEND – NEI NORTHWEST


2016$

2015$


Net realized gain (loss) on investments 45,153 136,015 Net unrealized gain (loss) on investments 750,156 (157,228)

1,120,404 206,933


295,539 307,209

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 824,865 (100,276)








from Operations 962 (20)- per unit 0.25 (0 .01)





2016$

2015$


from operations attributable to contract owners 824,865 (100,276)

PremiumsSeries 5 1,521,751 3,807,969 Series 6 834,582 897,640 Series 7 — —

2,356,333 4,705,609

WithdrawalsSeries 5 (1,946,868) (2,790,291)Series 6 (279,448) (135,898)Series 7 — —

(2,226,316) (2,926,189)


2016$

2015$


from operations attributable to contract owners 824,865 (100,276)

Adjustments for:Net realized gain (loss) (45,153) (136,015)Net unrealized gain (loss) (750,156) 157,228


Investments purchased (1,213,150) (2,778,182)Receivable for securities sold (7,070) (1,133)Accrued expenses 1,808 5,397 Payable for securities purchased (43,999) 13,152



NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES 65,582 1,787,107








Canadian Equity

DFS GIF – CANADIAN DIVIDEND – NEI NORTHWEST (cont.)


Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (99.5%)NEI Northwest Canadian Dividend Fund, Series I 1,206,574 18,652,367 20,109,122



NET ASSETS (100%) 20,210,454




Toronto-Dominion Bank 9 .3%Royal Bank of Canada 9 .1%Scotiabank 7 .2%Rogers Communications 7 .1%Kellogg Company 5 .0%Cenovus Energy 4 .6%Verizon Communications 4 .1%Atea 4 .1%Canadian Natural Resources 4 .1%Canadian Imperial Bank of Commerce 4 .0%Baxter International 3 .4%Power Financial Corporation 3 .2%Molson Coors Canada 2 .9%Magna International 2 .8%Canadian Tire Corporation 2 .7%Symantec Corporation 2 .6%Merck & Company 2 .5%Agrium 2 .5%Unilever 2 .2%Intact Financial Corporation 2 .2%Finning International 2 .1%Manulife Financial Corporation 2 .1%Parker Hannifin Corporation 2 .0%Eli Lilly and Company 1 .9%Potash Corporation of Saskatchewan 1 .6%




Investment ObjectiveThe objective of this Fund is to achieve a balance between high dividend income and capital growth by investing mainly in a diversified portfolio of blue chip Canadian common stocks and, to a lesser extent, in high-yield preferred stocks and interest bearing securities .

Investment StrategyThe Fund invests in primarily blue chip common stocks but may also invest in preferred stocks, bonds, purchase warrants and rights, royalty trusts and income trusts with preference given to capital growth while still providing a high regular level of income . Quality liquid corporations whose management has built shareholder value over time not to mention a proven ability to generate free cash flow, supporting growth and profitability as well as providing management with the ability to make strategic acquisitions, buy back stock and pay increasing dividends are preferred investments for this Fund . While equity securities including preferred stocks providing stable income are favoured, any small, mid and large capitalization Canadian corporations in a variety of industries meeting these criteria will be considered .

FINANCIAL INSTRUMENTS MEASUREMENT AT FAIR VALUE (Note 7)



June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

S&P/TSX 3 .00 434,392 409,830




Canadian Equity

DFS GIF – CANADIAN DIVIDEND – NEI NORTHWEST (cont.)


June 30 2016

$

December 31 2015


or loss (FVTPL) 148,815,453 151,331,052 Premiums receivable 40,268 —

148,855,721 151,331,052 LIABILITIESCurrent LiabilitiesBank overdraft 12,699 215,940 Accrued expenses 366,608 370,726 Withdrawals payable 151,012 72,532




Canadian Equity

DFS GIF – CANADIAN EQUITY – JARISLOWSKY FRASER


2016$

2015$

INCOMEInterest for attribution purposes — 21,965 Dividends 1,949,205 2,337,529 Changes in fair value:

Net realized gain (loss) on investments (425,176) 1,541,134 Net unrealized gain (loss) on investments 7,082,128 (6,337,656)

8,606,157 (2,437,028)


2,154,949 2,664,759

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 6,451,208 (5,101,787)





from Operations 6,284,153 (4,933,208)- per unit 0.31 (0 .20)






from Operations 954 - per unit 0.24






2016$

2015$



PremiumsSeries 3 54,835 95,257 Series 5 1,015,586 1,577,220 Series 6* 304,140 —Series 7* — —

1,374,561 1,672,477

WithdrawalsSeries 3 (630,536) (783,070)Series 5 (9,536,771) (14,923,610)Series 6* (4,914) —Series 7* — —

(10,172,221) (15,706,680)



2016$

2015$



Adjustments for:Net realized gain (loss) 425,176 (1,541,134)Net unrealized gain (loss) (7,082,128) 6,337,656


Investments purchased (2,108,962) (18,760,682)Receivable for securities sold — (137,448)Accrued expenses (4,118) (26,610)







SUPPLEMENTAL INFORMATION ON CASH FLOWS FROM (USED IN) OPERATING ACTIVITIESInterest paid — 562




Canadian Equity

DFS GIF – CANADIAN EQUITY – JARISLOWSKY FRASER (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.3%)Jarislowsky Fraser Canadian Equity Fund 4,839,149 147,421,015 148,815,453



NET ASSETS (100%) 148,325,402




Jarislowsky Fraser Special Equity Fund 8 .8%Toronto-Dominion Bank 7 .8%Royal Bank of Canada 6 .3%Scotiabank 5 .8%Enbridge 4 .3%Canadian National Railway Company 4 .2%Canadian Natural Resources 4 .1%Suncor Energy 3 .7%Open Text Corporation 3 .4%Manulife Financial Corporation 3 .2%SNC-Lavalin Group 3 .2%Alimentation Couche-Tard 3 .0%Canadian Tire Corporation 2 .8%Metro 2 .7%Loblaw Companies 2 .5%Gildan Activewear 2 .5%Thomson Reuters Corporation 2 .4%Intact Financial Corporation 2 .4%Cenovus Energy 2 .4%The Great-West Life Assurance Company 2 .1%Pembina Pipeline Corporation 1 .9%Potash Corporation of Saskatchewan 1 .8%Stantec 1 .7%CGI Group 1 .7%Saputo 1 .7%




Investment ObjectiveTo achieve long-term capital appreciation while continuing to emphasize the preservation of capital by investing primarily in large cap Canadian equity securities .

Investment StrategyTo invest primarily in Canadian equity securities in areas of the Canadian economy where superior rates of growth are expected .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $








Canadian Equity

DFS GIF – CANADIAN EQUITY – JARISLOWSKY FRASER (cont.)






%


June 30, 2016 $


December 31, 2015 $

S&P/TSX 3 .00 3,604,583 3,362,033





June 30 2016

$

December 31 2015







Canadian Equity

DFS GIF – CANADIAN EQUITY – FIDELITY TRUE NORTH®

® Fidelity True North is a registered trademark of FMR Corp.


2016$

2015$


Net realized gain (loss) on investments 231,419 375,813 Net unrealized gain (loss) on investments 1,279,491 338,164

1,510,910 713,977


473,059 451,020

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 1,037,851 262,957
















2016$

2015$


from operations attributable to contract owners 1,037,851 262,957


5,462,033 6,072,160

WithdrawalsSeries 3 (222,837) (180,488)Series 5 (3,388,789) (2,681,542)Series 6 (514,777) (686,805)Series 7 (123,217) (3,349)

(4,249,620) (3,552,184)


2016$

2015$



Adjustments for:Net realized gain (loss) (231,419) (375,813)Net unrealized gain (loss) (1,279,491) (338,164)


Investments purchased (2,606,176) (3,444,432)Accrued expenses 4,654 9,064 Payable for securities purchased 158,734 (2,597)











Canadian Equity

DFS GIF – CANADIAN EQUITY – FIDELITY TRUE NORTH® (cont.)


Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.0%)Fidelity True North® Fund, Series O 708,200 26,856,006 32,146,407



NET ASSETS (100%) 32,158,531




Toronto-Dominion Bank 7 .4%Loblaw Companies 4 .2%Rogers Communications 3 .8%Canadian National Railway Company 3 .3%Suncor Energy 3 .0%Metro 2 .9%CGI Group 2 .8%Enbridge 2 .6%Tahoe Resources 2 .2%Gildan Activewear 2 .1%Peyto Exploration & Development Corporation 2 .0%Power Corporation of Canada 2 .0%Fairfax Financial Holdings 2 .0%Alimentation Couche-Tard 1 .9%Restaurant Brands International 1 .8%Franco-Nevada Corporation 1 .8%Manulife Financial Corporation 1 .8%Johnson & Johnson 1 .8%Intact Financial Corporation 1 .7%Constellation Software 1 .6%Eldorado Gold Corporation 1 .6%SNC-Lavalin Group 1 .5%Precision Drilling Corporation 1 .5%Canadian Natural Resources 1 .4%ARC Resources 1 .4%




Investment ObjectiveTo achieve strong long-term capital growth by investing primarily in equity securities of Canadian companies that have a history of strong capital growth over the long-term . The fundamental investment of this Fund is to achieve long-term capital appreciation while still emphasizing the preservation of capital by investing primarily in Canadian equity securities .

Investment StrategyTo invest primarily in small, medium and large Canadian companies . The Fund may also invest in a limited portion of foreign securities . The Fund may also use, to a lesser degree, derivatives such as options, futures, forward contracts and swaps to protect against losses caused by changes in stock prices or exchange rates .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

S&P/TSX Capped 3 .00 613,872 566,307




Canadian Equity

DFS GIF – CANADIAN EQUITY – FIDELITY TRUE NORTH® (cont.)


June 30 2016

$

December 31 2015



29,953,006 29,701,793 LIABILITIESCurrent LiabilitiesAccrued expenses 81,894 81,517 Withdrawals payable 72,265 9,260




Canadian Equity

DFS GIF – CANADIAN EQUITY – FRANKLIN BISSETT


2016$

2015$

INCOMEDividends — 162,428 Changes in fair value:

Net realized gain (loss) on investments 787,112 1,403,052 Net unrealized gain (loss) on investments 2,094,177 (1,921,087)

2,881,289 (355,607)


477,006 619,419

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 2,404,283 (975,026)











from Operations 3,003 (476)- per unit 0.47 (0 .13)





2016$

2015$


from operations attributable to contract owners 2,404,283 (975,026)

PremiumsSeries 3 377,077 479,443 Series 5 812,568 804,108 Series 6 444,487 697,892 Series 7 300 650

1,634,432 1,982,093

WithdrawalsSeries 3 (1,743,370) (2,282,543)Series 5 (1,770,643) (2,375,483)Series 6 (317,804) (517,643)Series 7 (19,067) (3)

(3,850,884) (5,175,672)


2016$

2015$



Adjustments for:Net realized gain (loss) (787,112) (1,403,052)Net unrealized gain (loss) (2,094,177) 1,921,087


Investments purchased (319,562) (816,013)Receivable for securities sold (29,817) (88,621)Accrued expenses 377 (7,642)Payable for securities purchased — (4,460)










Canadian Equity

DFS GIF – CANADIAN EQUITY – FRANKLIN BISSETT (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.0%)Franklin Bissett Canadian Equity Fund, Series O 220,801 20,326,873 29,799,313


OTHER NET ASSETS (-0.0%) (466)

NET ASSETS (100%) 29,798,847




Brookfield Asset Management 5 .3%Canadian National Railway Company 4 .9%Toronto-Dominion Bank 4 .7%Canadian Imperial Bank of Commerce 4 .6%Royal Bank of Canada 4 .2%Bank of Montreal 4 .2%Restaurant Brands International 4 .2%Enbridge 3 .8%Scotiabank 3 .7%MacDonald, Dettwiler and Associates Ltd 3 .2%Onex Corporation 3 .0%Metro 3 .0%Saputo 2 .8%Alimentation Couche-Tard 2 .7%Canadian Pacific Railway 2 .7%Thomson Reuters Corporation 2 .2%Power Corporation of Canada 2 .2%Atco Ltd 2 .2%TransCanada Corporation 2 .0%Inter Pipeline 2 .0%Home Capital Group 1 .9%Toromont Industries Ltd 1 .9%Power Financial Corporation 1 .8%Keyera Corporation 1 .6%Rogers Communications 1 .5%




Investment ObjectiveThe fundamental investment objective of this Fund is to achieve long-term capital appreciation while continuing to emphasize the preservation of capital by investing primarily in Canadian equity securities .

Investment StrategyTo invest primarily in mid to large cap Canadian equity securities of growth-oriented companies . The Fund may also have a foreign equity component .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $








Canadian Equity

DFS GIF – CANADIAN EQUITY – FRANKLIN BISSETT (cont.)






%


June 30, 2016 $


December 31, 2015 $

S&P/TSX 3 .00 861,645 814,325





June 30 2016

$

December 31 2015



or loss (FVTPL) pledged as collateral 2,216,362 5,513,817 Premiums receivable 3,311 6,981 Receivable for securities sold 9,216 149,690 Interest, dividends and other receivables 61,526 68,855

36,537,287 36,677,234 LIABILITIESCurrent LiabilitiesAccrued expenses 99,766 102,984 Withdrawals payable 31,056 5,449 Payable for securities purchased 335,825 —


NET ASSETS PER UNITSeries 1 10.47 9 .99 Series 3 11.61 11 .05 Series 5 12.30 11 .67 Series 6 5.31 5 .04 Series 7 5.38 5 .09 Series IGP 10.03 9 .50


Canadian Equity

DFS GIF – CANADIAN EQUITY – FIERA CAPITAL


2016$

2015$

INCOMEInterest for attribution purposes 30,378 9,027 Dividends 460,831 461,708 Revenue from securities lending and

repurchase transactions 2,365 3,464 Changes in fair value:

Net realized gain (loss) on investments (31,492) 1,972,362 Net unrealized gain (loss) on investments 1,918,162 (294,128)

2,380,244 2,152,433 EXPENSESManagement fees and guarantee charge 461,787 531,226 Operating expenses 127,121 144,055

588,908 675,281 Commissions and other portfolio

transaction costs 55,227 37,895 644,135 713,176

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 1,736,109 1,439,257 DATA PER SERIESSERIES 1Increase (Decrease) in Net Assets










Average Number of Units 8,306 8,557 SERIES IGPIncrease (Decrease) in Net Assets






2016$

2015$



PremiumsSeries 1 101,551 215,917 Series 3 253,644 298,793 Series 5 299,009 273,473 Series 6 60,516 234,475 Series 7 — —Series IGP 8,350 9,857

723,070 1,032,515

WithdrawalsSeries 1 (1,034,974) (1,353,554)Series 3 (994,858) (1,481,816)Series 5 (526,530) (553,863)Series 6 (17,477) (35,216)Series 7 (20) (2,028)Series IGP (383,481) (1,055,339)

(2,957,340) (4,481,816)


2016$

2015$



Adjustments for:Net realized gain (loss) 31,492 (1,972,362)Net unrealized gain (loss) (1,918,162) 294,128


Investments purchased (31,420,645) (29,646,531)Receivable for securities sold 140,474 —Cash guarantee received for repurchase

transactions — (1,875,741)Interest, dividends and other receivables 7,329 (7,535)Accrued expenses (3,218) (733)Commitments related to repurchase

transactions — 1,875,741 Payable for securities purchased 335,825 —


CASH FLOWS FROM (USED IN) FINANCING ACTIVITIESPremium payments 726,740 1,036,662 Amounts paid on withdrawals (2,931,733) (4,439,453)


Effect of exchange rate changes on foreign cash (1,049) 720




SUPPLEMENTAL INFORMATION ON CASH FLOWS FROM (USED IN) OPERATING ACTIVITIESInterest received 20,838 7,202

Dividends received, net of withholding taxes 465,147 454,055

Interest paid — 2




FOR EASE OF COMPREHENSION TO THE READER, FOR THE DFS GIF – CANADIAN EQUITY – FIERA CAPITAL, THE ENTIRE PORTFOLIO OF SECURITIES IN THE SCHEDULE OF INVESTMENT PORTFOLIO AS AT JUNE 30, 2016, HAS NOT BEEN DISCLOSED. INSTEAD, THE MAJOR CATEGORIES OF ASSETS ARE LISTED ALONG WITH THE PERCENTAGES THAT EACH OF THESE CATEGORIES HOLD. THE TOTAL COSTS, FAIR VALUES, NUMBER OF UNITS, TOTAL INVESTMENTS AND NET ASSETS ARE ALSO LISTED.


Canadian Equity

DFS GIF – CANADIAN EQUITY – FIERA CAPITAL (cont.)


Number Fair of Shares Cost Value $ $EQUITIES (96.3%)

Energy (18.2%)Canadian Natural Resources 31,495 1,075,774 1,255,391 Cenovus Energy* 36,852 714,321 658,545 Crescent Point Energy 24,753 550,346 505,209 Enbridge 22,048 1,128,869 1,206,687 Husky Energy 34,489 528,500 543,892 Peyto Exploration & Development 14,700 429,389 509,796 Suncor Energy 23,944 845,574 858,153 TransCanada, Subscription Receipts 17,336 793,122 1,011,036

6,065,895 6,548,709

Materials (15.8%)Agrium 4,500 551,195 526,005 Barrick Gold 19,469 533,333 536,955 CCL Industries, Class B 4,810 972,639 1,081,480 First Quantum Minerals 62,123 639,702 563,456 Franco-Nevada 4,164 245,856 409,071 Tahoe Resources 65,213 921,209 1,261,872 Yamana Gold 195,711 1,150,353 1,315,178

5,014,287 5,694,017

Industrials (9.3%)Canadian National Railway Company 20,422 1,608,164 1,557,994 Canadian Pacific Railway 5,034 801,523 837,305 Waste Connections 10,092 830,353 941,987

3,240,040 3,337,286

Consumer Discretionary (10.3%)Dollarama 6,933 307,721 625,357 Gildan Activewear* 31,439 956,302 1,189,652 Magna International, Class A 14,800 769,250 671,180 Quebecor, Class B 14,101 464,487 522,019 Restaurant Brands International 13,038 713,613 701,184

3,211,373 3,709,392

Consumer Staples (5.6%)Alimentation Couche-Tard, Class B 22,716 1,075,116 1,260,284 Loblaw Companies 11,108 587,442 767,674

1,662,558 2,027,958

Health Care (0.5%)Valeant Pharmaceuticals International* 7,293 1,563,310 189,983

Financials (32.3%)Brookfield Asset Management, Class A 18,800 819,985 803,512 CI Financial 17,070 524,595 460,036 Element Financial Corporation* 85,122 1,250,670 1,166,171 Intact Financial Corporation 4,999 410,904 461,358 Manulife Financial 70,651 1,512,319 1,248,403Royal Bank of Canada 37,491 2,794,470 2,862,063




Number Fair of Shares Cost Value $ $Financials (cont.)

Scotiabank 32,197 1,977,284 2,038,392 Toronto-Dominion Bank 47,109 2,581,538 2,613,607

11,871,765 11,653,542

Information Technology (3.2%)CGI Group, Class A* 21,213 1,189,454 1,170,745

Utilities (1.1%)Algonquin Power & Utilities Corp . 33,174 359,956 394,439

TOTAL EQUITIES 34,178,638 34,726,071

Par Value

Money Market Securities (4.8%)Canada Treasury Bills 2016-07-05 CAD 525,000 524,837 524,837 2016-08-25 CAD 1,150,000 1,149,044 1,149,042 2016-09-08 CAD 60,000 59,945 59,945

TOTAL MONEY MARKET SECURITIES 1,733,826 1,733,824

PORTFOLIO TRANSACTION COSTS INCLUDED IN THE SECURITIES’ COST (24,235) —



NET ASSETS (100%) 36,070,640

*Securities pledged as collateral, in part or in whole, through the securities lending program.The accompanying Notes are an integral part of these financial statements.




Investment ObjectiveTo provide investors with long-term capital growth by investing primarily in Canadian equity securities .

Investment StrategyTo invest primarily in the common shares of medium and large cap Canadian securities of growth-oriented companies .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLEquities 34,726,071 — — 34,726,071 Money Market Securities 1,733,824 — — 1,733,824 TOTAL 36,459,895 — — 36,459,895


Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLEquities 35,317,909 — — 35,317,909 Money Market Securities 1,114,116 — — 1,114,116 TOTAL 36,432,025 — — 36,432,025


Classification of Level 3As at June 30, 2016 and December 31, 2015, the Fund has no financial instruments classified within Level 3 .

Reconciliation of Level 3 Fair Value MeasurementThe following table summarizes a reconciliation of movements on Level 3 financial instruments between the beginning and end of the period:

June 30, 2016 Equities $

Balance, Beginning of Period — Proceeds from sale of investments — Investments purchased 1,191,147 Net realized gain (loss) — Net unrealized gain (loss) — Transfers to (from) Level 3 (1,191,147)Balance, End of Period —

Certain securities classified as Level 3 entailed restrictions . In April 2016, these securities valued at approximately $1,191,000 were transferred from Level 3 to Level 1 following the expiration of the restrictions . These securities are now valued at the quoted prices on the active markets .

Canadian Equity





Currency Risk

As at June 30, 2016 and December 31, 2015, the majority of the Fund’s financial assets and liabilities are denominated in Canadian dollars . As a result, the Fund is not significantly exposed to currency risk .

Interest Rate RiskAs at June 30, 2016 and December 31, 2015, the majority of the Fund’s financial assets and liabilities are non-interest bearing . As a result, the Fund is not subject to significant amounts of risk arising from fluctuations in the prevailing levels of market interest rates .

Concentration RiskThe following table summarizes the concentration risk, as a percentage of the Net Assets Attributable to Contract Owners:


Equities Financials 32 .3 Energy 18 .2 Materials 15 .8 Consumer Discretionary 10 .3 Industrials 9 .3 Consumer Staples 5 .6 Information Technology 3 .2 Utilities 1 .1 Health Care 0 .5 Money Market Securities 4 .8 Other Net Assets (1 .1)TOTAL 100


Equities Financials 36 .5 Energy 16 .6 Materials 13 .4 Industrials 9 .6 Consumer Staples 5 .5 Consumer Discretionary 4 .9 Information Technology 4 .6 Health Care 2 .8 Telecommunication Services 2 .7 Money Market Securities 3 .0 Other Net Assets 0 .4 TOTAL 100

Price RiskThe Fund may trade in financial instruments and take positions in traded and over-the-counter instruments .The Manager's estimate of the impact on Net Assets Attributable to Contract Owners as a result of a reasonably possible change in benchmarks, using a historical beta coefficient (a measure of the sensitivity of a security in comparison to the market) between the Fund’s return as compared to the return of the Fund’s benchmarks, with all other variables held constant, is included in the following table . A 36-month regression analysis has been utilized to estimate the historical beta coefficient . The regression analysis uses data based on the monthly returns of the Fund .


%


June 30, 2016 $


$S&P/TSX Capped 3 .00 1,045,015 1,014,111


Credit RiskAs at June 30, 2016 and December 31, 2015, the Fund had no significant investments in either fixed-income securities, money market securities and derivative financial instruments . As a result, the Fund is not significantly exposed to credit risk .

Liquidity RiskFor further information on maturities of financial liabilities and liquidity risk management of the Fund, please refer to Note 7 “Financial Instruments Disclosures” .


Canadian Equity



Securities Lending and Repurchase TransactionsAs part of transactions involving securities lending or repurchase transactions, the Fund transfers financial assets under terms and conditions providing for their future repurchase . These financial assets remain recognized in the “Investments at fair value through profit or loss pledged as collateral” of the Statement of Financial Position as the Fund retains substantially all the risks and rewards related to these assets .

June 30, 2016$

December 31, 2015$

Investments at FVTPL pledged as Collateral 2,216,362 5,513,817 Value of Collateral Securities 2,260,689 5,624,094

The Funds require collateral in the form of cash or such other securities as may be acceptable to Desjardins Financial Security and that have an aggregate value of no less than 102% of the loaned securities fair value .

RECONCILIATION OF INCOME FROM SECURITY LENDING AND REPURCHASE TRANSACTION (NOTE 2)The following table shows a reconciliation of the total income generated from securities lending transactions of the Fund and the revenue from securities lending and repurchase transactions disclosed in the Fund’s Statement of Comprehensive Income .

June 30, 2016$

June 30, 2016%

June 30, 2015$

June 30, 2015%

Total Income 3,942 100 5,773 100Net Income received by: DFS GIF – Canadian Equity – Fiera Capital 2,365 60 3,464 60Desjardins Trust 1,577 40 2,309 40


June 30 2016

$

December 31 2015



16,361,433 15,533,768 LIABILITIESCurrent LiabilitiesAccrued expenses 45,741 43,507 Withdrawals payable 11,162 4,677 Payable for securities purchased 862 11,863




Canadian Equity

DFS GIF – SPECIALTY EQUITY – NEI NORTHWEST


2016$

2015$


Net realized gain (loss) on investments (32,405) 147,623 Net unrealized gain (loss) on investments 1,958,153 301,641

1,925,748 449,264


259,758 322,513

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 1,665,990 126,751





from Operations 1,211,508 102,455 - per unit 0.65 0 .05











2016$

2015$



PremiumsSeries 3 40,686 70,891 Series 5 1,177,665 1,389,004 Series 6 248,119 443,929 Series 7 — —

1,466,470 1,903,824

WithdrawalsSeries 3 (268,443) (578,335)Series 5 (1,851,448) (3,120,939)Series 6 (182,622) (161,448)Series 7 — —

(2,302,513) (3,860,722)


2016$

2015$



Adjustments for:Net realized gain (loss) 32,405 (147,622)Net unrealized gain (loss) (1,958,153) (301,641)


Investments purchased (332,539) (319,772)Receivable for securities sold (2,599) (482)Accrued expenses 2,234 (3,226)Payable for securities purchased (11,001) 1,977

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 878,413 1,958,656


NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES (892,744) (1,938,631)







Canadian Equity

DFS GIF – SPECIALTY EQUITY – NEI NORTHWEST (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (99.8%)NEI Northwest Specialty Equity Fund, Series I 896,765 14,980,200 16,265,695



NET ASSETS (100%) 16,303,668




Home Capital Group 5 .9%Cash and Cash Equivalents 5 .3%Osisko Gold Royalties 5 .0%Parex Resources 5 .0%Fortuna Silver Mines 4 .5%Premium Brands Holdings Corporation 4 .2%New Flyer Industries 4 .2%Kinaxis 3 .8%Callidus Capital Corporation 3 .5%Lassonde Industries 3 .5%Element Financial Corporation 3 .4%Winpak Ltd 3 .1%Major Drilling Group International 2 .9%Boyd Group Income Fund 2 .9%Alaris Royalty Corporation 2 .5%Descartes Systems Group 2 .4%Industrial Alliance, Insurance and Financial Services 2 .4%Metro 2 .3%Cogeco 2 .2%Laurentian Bank of Canada 2 .0%Parkland Fuel Corporation 2 .0%Advantage Oil & Gas 2 .0%Cipher Pharmaceuticals 1 .9%Andrew Peller 1 .8%WSP Global 1 .8%




Investment ObjectiveTo achieve capital appreciation over the longer term by investing primarily in the equity of smaller, fast growing Canadian companies with small market capitalizations under a billion dollars .

Investment StrategyTo invest primarily in common shares and other equity securities issued by companies that are financially strong and have distinct competitive advantages at relative valuations .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $








Canadian Equity

DFS GIF – SPECIALTY EQUITY – NEI NORTHWEST (cont.)






%


June 30, 2016 $


December 31, 2015 $

S&P/TSX Small Cap (50%) 3 .00 201,760 231,847S&P/TSX Completion (50%) 3 .00 201,760 154,565





June 30 2016

$

December 31 2015

$ASSETSCurrent AssetsCash — 668 Investments at fair value through profit


17,479,410 16,226,975 LIABILITIESCurrent LiabilitiesBank overdraft 588 —Accrued expenses 49,115 44,878 Withdrawals payable 55,956 —Payable for securities purchased — 13,653




Canadian Equity

DFS GIF – SMALL CAP – FRANKLIN BISSETT


2016$

2015$


Net realized gain (loss) on investments (71,263) 442,984 Net unrealized gain (loss) on investments 2,584,232 (721,182)

2,512,969 (278,198)


278,087 387,552

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS 2,234,882 (665,750)











from Operations 3,920 (294)- per unit 0.56 (0 .01)





2016$

2015$



PremiumsSeries 3 111,698 114,665 Series 5 665,529 689,574 Series 6 391,355 637,436 Series 7 300 650

1,168,882 1,442,325

WithdrawalsSeries 3 (728,806) (1,394,414)Series 5 (1,276,446) (2,488,821)Series 6 (192,580) (391,880)Series 7 (625) (88,362)

(2,198,457) (4,363,477)


2016$

2015$



Adjustments for:Net realized gain (loss) 71,263 (442,984)Net unrealized gain (loss) (2,584,232) 721,182


Investments purchased (474,322) (442,631)Receivable for securities sold (34,980) (19,687)Accrued expenses 4,237 (8,213)Payable for securities purchased (13,653) (13,860)

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 976,839 2,911,462


NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES (978,095) (2,919,588)


Cash (bank overdraft), beginning of period 668 (3,863)

CASH (BANK OVERDRAFT), END OF PERIOD (588) (11,989)





Canadian Equity

DFS GIF – SMALL CAP – FRANKLIN BISSETT (cont.)


Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.3%)Franklin Bissett Small Cap Fund, Series O 226,001 16,435,363 17,426,944



NET ASSETS (100%) 17,373,751




Indigo Books & Music 6 .3%Equitable Group 6 .1%Canam Group 5 .0%Leon’s Furniture Ltd 5 .0%Richelieu Hardware Ltd 3 .8%Transcontinental 3 .7%Transat A .T . 3 .6%Advantage Oil & Gas 3 .3%Winpak Ltd 3 .2%Trican Well Service Ltd 3 .1%Xtreme Drilling and Coil Services Corporation 3 .1%Trinidad Drilling 2 .9%Major Drilling Group International 2 .8%Canyon Services Group Inc . 2 .6%Calfrac Well Services Ltd 2 .5%Westaim Corporation 2 .5%NuVista Energy Ltd 2 .4%Reitmans (Canada) Ltd 2 .3%AGF Management Ltd 2 .1%Home Capital Group 2 .0%Horizon North Logistics 1 .9%Delphi Energy Corporation 1 .9%Storm Resources Ltd 1 .8%AKITA Drilling Ltd 1 .7%Granite Real Estate 1 .6%




Investment ObjectiveTo provide investors with long-term capital appreciation . The Fund invests mainly in shares of Canadian companies with small to medium market capitalizations which are expected to provide above-average returns .

Investment StrategyTo be fully diversified at all times to compensate for the volatility inherent in investing in small capitalization equities .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

S&P/TSX Small Cap 3 .00 381,902 360,677




Canadian Equity

DFS GIF – SMALL CAP – FRANKLIN BISSETT (cont.)


June 30 2016

$

December 31 2015







Foreign Equity

DFS GIF – AMERICAN EQUITY – MFS


2016$

2015$

INCOMEInterest for attribution purposes — 79 Dividends 164,614 138,307 Changes in fair value:

Net realized gain (loss) on investments 245,375 224,914 Net unrealized gain (loss) on investments (1,251,280) 967,479

(841,291) 1,330,779



315,332 266,347

















2016$

2015$




3,149,847 3,958,980

WithdrawalsSeries 3 (608,593) (682,111)Series 5 (1,734,615) (868,518)Series 6 (447,417) (99,513)Series 7 (13) —

(2,790,638) (1,650,142)


2016$

2015$



Adjustments for:Net realized gain (loss) (245,375) (224,914)Net unrealized gain (loss) 1,251,280 (967,479)


Investments purchased (2,295,873) (3,984,526)Receivable for securities sold — (3,801)Accrued expenses (1,438) 8,755 Payable for securities purchased (2,210) 32,416










Foreign Equity

DFS GIF – AMERICAN EQUITY – MFS (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.2%)MFS MB U .S . Equity Core Fund 1,290,311 17,508,454 19,892,752



NET ASSETS (100%) 19,856,292




JPMorgan Chase & Company 3 .2%Danaher Corporation 3 .2%Visa 2 .8%Thermo Fisher Scientific 2 .5%American Tower Corporation 2 .5%Johnson & Johnson 2 .4%Alphabet, Class A 2 .3%Schlumberger Ltd 2 .1%Newell Brands 2 .1%Comcast Corporation 2 .0%Broadcom Ltd 2 .0%Accenture 2 .0%Bank of America Corporation 1 .9%Fidelity National Information Services 1 .9%Wells Fargo & Company 1 .9%Cognizant Technology Solutions Corporation 1 .9%Alphabet, Class C 1 .8%Honeywell International 1 .7%Mondelez International 1 .7%Monsanto Corporation 1 .7%Canadian National Railway Company 1 .6%Ross Stores 1 .6%Time Warner 1 .6%EOG Resources 1 .6%Mastercard 1 .6%




Investment ObjectiveTo outperform the S&P 500 .

Investment StrategyTo invest mainly in large cap equity securities of corporations located in the United States .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $








Foreign Equity

DFS GIF – AMERICAN EQUITY – MFS (cont.)






%


June 30, 2016 $


December 31, 2015 $

S&P 500 3 .00 586,702 620,303





June 30 2016

$

December 31 2015


or loss (FVTPL) 22,281,405 23,456,902 Premiums receivable 87,516 64,526 Receivable for securities sold 527 —





Foreign Equity

DFS GIF – AMERICAN EQUITY VALUE – DESJARDINS


2016$

2015$


Net realized gain (loss) on investments 434,775 120,445 Net unrealized gain (loss) on investments (1,334,321) 875,955

(571,266) 1,238,093



386,801 308,456

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS (958,067) 929,637



















2016$

2015$


from operations attributable to contract owners (958,067) 929,637

PremiumsSeries 1 45,911 131,102 Series 3 286,469 353,959 Series 5 2,000,875 3,133,351 Series 6 1,149,252 1,916,049 Series 7 30,017 293,918

3,512,524 5,828,379

WithdrawalsSeries 1 (180,676) (116,987)Series 3 (525,338) (498,414)Series 5 (2,117,167) (951,451)Series 6 (526,084) (191,604)Series 7 (361,272) (30,402)

(3,710,537) (1,788,858)


2016$

2015$



Adjustments for:Net realized gain (loss) (434,775) (120,445)Net unrealized gain (loss) 1,334,321 (875,955)


Investments purchased (2,019,329) (4,912,390)Receivable for securities sold (527) (14,036)Accrued expenses (1,892) 13,403 Payable for securities purchased (19,604) (74,456)

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 195,816 (4,128,323)



Effect of exchange rate changes on foreign cash (409) 386








Foreign Equity

DFS GIF – AMERICAN EQUITY VALUE – DESJARDINS (cont.)


Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (99.6%)Desjardins American Equity Value Fund, I-Class 938,283 17,927,577 22,281,405



NET ASSETS (100%) 22,359,748




Exxon Mobil Corporation 4 .0%Chevron Corporation 3 .5%Merck & Company 3 .3%Wells Fargo & Company 3 .0%Cash and Cash Equivalents 3 .0%JPMorgan Chase & Company 3 .0%Bank of America Corporation 2 .8%Cisco Systems 2 .7%Intel Corporation 2 .6%Chubb Ltd 1 .7%Johnson & Johnson 1 .6%Ameren Corporation 1 .6%Verizon Communications 1 .6%Walgreens Boots Alliance 1 .6%Citigroup 1 .6%Alliant Energy Corporation 1 .6%AstraZeneca 1 .6%EOG Resources 1 .6%Philip Morris International 1 .5%Pfizer 1 .5%Lockheed Martin Corporation 1 .5%United Parcel Service 1 .5%Anadarko Petroleum Corporation 1 .5%Mondelez International 1 .4%Comcast Corporation 1 .4%




Investment ObjectiveTo provide investors with long-term capital growth by investing primarily in U .S . equities .

Investment StrategyTo invest primarily in the common shares of high quality, publicly traded mid to large United States companies across a wide range of market sectors .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $

Financial Assets at FVTPLInvestment Funds 22 281,405 — — 22 281,405 TOTAL 22,281,405 — — 22,281,405


Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

S&P 500 3 .00 644,073 679,820




Foreign Equity

DFS GIF – AMERICAN EQUITY VALUE – DESJARDINS (cont.)


June 30 2016

$

December 31 2015







Foreign Equity

DFS GIF – GLOBAL DIVIDEND – DESJARDINS


2016$

2015$



441,418 337,688



274,385 153,242






from Operations 101,087 (1,440)- per unit 0.08 —








2016$

2015$




5,371,461 4,954,346

WithdrawalsSeries 5 (991,532) (1,019,466)Series 6 (655,847) (205,667)Series 7 (266,716) (18,498)

(1,914,095) (1,243,631)


2016$

2015$





Investments purchased (4,481,063) (4,015,667)Receivable for securities sold (2,064) (25,677)Accrued expenses 8,590 10,260 Payable for securities purchased (32,616) (3,224)



NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES 3,485,870 3,721,347 Increase (Decrease) in cash/bank

overdraft (5,314) (27,065)Cash (bank overdraft), beginning of

period 3,719 2,042





Foreign Equity

DFS GIF – GLOBAL DIVIDEND – DESJARDINS (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.2%)Desjardins Global Dividend Fund, I-Class 987,501 17,415,914 18,895,819



NET ASSETS (100%) 18,851,600




Cash and Cash Equivalents 3 .0%Welltower 2 .0%WEC Energy Group 2 .0%National Grid 2 .0%AT&T 2 .0%PPL Corporation 1 .9%Philip Morris International 1 .9%Duke Energy Corporation 1 .8%Verizon Communications 1 .8%BCE 1 .8%Iron Mountain REIT 1 .7%Altria Group 1 .7%Terna - Rete Elettricita Nazionale 1 .7%Rogers Communications 1 .7%Imperial Brands 1 .6%Reynolds American 1 .6%Vodafone Group plc 1 .6%Entergy Corporation 1 .5%British American Tobacco 1 .5%Statoil ASA 1 .5%GlaxoSmithKline plc 1 .5%Royal Dutch Shell 1 .5%Total SA 1 .4%Muenchener Rueckversicherung 1 .4%Occidental Petroleum Corporation 1 .4%




Investment ObjectiveThe objective of this Fund is to provide dividend income and long term capital appreciation through the investment in equity and equity related securities of companies around the world, including, when deemed appropriate, emerging markets .

Investment StrategyIn order to achieve its investment objective, the Fund invests in companies with high dividend yields and whose management teams optimize their balance sheets through the redemption of shares or reducing debt or by opting to increase cash flows sufficiently to allow for the opportunity for dividend growth . Companies are selected which show stable or high profit growth, a lower than average debt in comparison to their industry average and whose securities are traded at a reasonable price in relation to other companies with similar characteristics . Equity related securities such as American Depositary Receipts (ADRs) and Global Depositary Receipts (GDRs) may be used to gain exposure to a particular stock or sector .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $







Foreign Equity

DFS GIF – GLOBAL DIVIDEND – DESJARDINS (cont.)







%


June 30, 2016 $


December 31, 2015 $

MSCI World Net 3 .00 480,833 437,431





June 30 2016

$

December 31 2015



54,705,147 62,098,541 LIABILITIESCurrent LiabilitiesAccrued expenses 131,892 149,485 Withdrawals payable 78,597 63,529




Foreign Equity

DFS GIF – GLOBAL EQUITY – MFS


2016$

2015$

INCOMEInterest for attribution purposes — 34 Dividends 709,277 284,453 Changes in fair value:

Net realized gain (loss) on investments 326,430 390,286 Net unrealized gain (loss) on investments (4,040,643) 2,319,276

(3,004,936) 2,994,049



885,065 397,962

















2016$

2015$



PremiumsSeries 3 156,070 43,187 Series 5 951,839 269,024 Series 6 465,718 365,653 Series 7 150,392 —

1,724,019 677,864

WithdrawalsSeries 3 (409,836) (11,449)Series 5 (4,726,145) (1,039,559)Series 6 (88,805) (2,971)Series 7 (101) —

(5,224,887) (1,053,979)


2016$

2015$



Adjustments for:Net realized gain (loss) (326,430) (390,286)Net unrealized gain (loss) 4,040,643 (2,319,276)


Investments purchased (1,169,191) (675,876)Receivable for securities sold (14) (1,526)Accrued expenses (17,593) 5,653 Payable for securities purchased — (1,719)

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 3,441,469 378,439

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIESPremium payments 1,768,394 669,558 Amounts paid on withdrawals (5,209,819) (1,049,746)

NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES (3,441,425) (380,188)Increase (Decrease) in cash/bank

overdraft 44 (1,749)Cash (bank overdraft), beginning of

period 23,690 32,356






Foreign Equity

DFS GIF – GLOBAL EQUITY – MFS (cont.)


Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.3%)MFS Global Research Fund 2,999,965 50,952,523 54,676,157



NET ASSETS (100%) 54,494,658




Danaher Corporation 1 .9%CMS Energy Corporation 1 .6%Alphabet 1 .6%Procter & Gamble Company 1 .4%Charter Communications 1 .3%KDDI Corporation 1 .3%Novartis AG 1 .3%British Petroleum plc 1 .3%SBA Communications Corporation 1 .3%Facebook 1 .3%JPMorgan Chase & Company 1 .2%Roche Holding AG 1 .2%Medtronic 1 .2%Nestlé 1 .2%Visa 1 .2%EOG Resources 1 .2%Cisco Systems 1 .1%Exxon Mobil Corporation 1 .1%Honeywell International 1 .0%Aon plc 1 .0%Union Pacific Corporation 1 .0%Eli Lilly and Company 1 .0%Stryker Corporation 1 .0%Chubb Ltd 1 .0%Broadcom Ltd 1 .0%




Investment ObjectiveTo achieve long-term capital growth by investing primarily in equity securities .

Investment StrategyTo control the level of volatility of return relative to the overall stock markets by maintaining strong geographic diversification and by investing in attractively-valued securities . The Fund will primarily invest in common stocks of American, European, and Asian corporations .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

MSCI All Country World Net 3 .00 1,624,383 1,775,679




Foreign Equity

DFS GIF – GLOBAL EQUITY – MFS (cont.)


June 30 2016

$

December 31 2015


or loss (FVTPL) 10,832,413 12,617,872 Premiums receivable 908 17,684 Receivable for securities sold 1,718 —Interest, dividends and other receivables 260 272

10,836,604 12,641,271 LIABILITIESCurrent LiabilitiesAccrued expenses 29,520 34,159 Withdrawals payable 20,122 2,677 Payable for securities purchased — 2,275




Foreign Equity

DFS GIF – INTERNATIONAL EQUITY – MFS


2016$

2015$

INCOMEInterest for attribution purposes 354 267 Changes in fair value:

Net realized gain (loss) on investments 116,623 332,534 Net unrealized gain (loss) on investments (1,334,243) 1,407,731

(1,217,266) 1,740,532


185,253 203,961 Withholding taxes 12 3

185,265 203,964




















2016$

2015$



PremiumsSeries 1 20,405 74,280 Series 3 211,475 198,623 Series 5 250,328 505,455 Series 6 135,370 260,291 Series 7 — 58,000

617,578 1,096,649

WithdrawalsSeries 1 (109,406) (135,618)Series 3 (474,935) (918,275)Series 5 (350,172) (564,616)Series 6 (95,732) (270)Series 7 — —

(1,030,245) (1,618,779)


2016$

2015$



Adjustments for:Net realized gain (loss) (116,623) (332,534)Net unrealized gain (loss) 1,334,243 (1,407,731)

Proceeds from sale/maturity of investments 878,243 1,362,780

Investments purchased (310,404) (676,673)Receivable for securities sold (1,718) (20,479)Interest, dividends and other receivables 12 3 Accrued expenses (4,639) 2,868 Payable for securities purchased (2,275) 1,238

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 374,308 466,040

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIESPremium payments 634,354 1,082,418 Amounts paid on withdrawals (1,012,800) (1,569,275)

NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES (378,446) (486,857)Increase (Decrease) in cash/bank

overdraft (4,138) (20,817)Cash (bank overdraft), beginning of

period 5,443 23,667





Foreign Equity

DFS GIF – INTERNATIONAL EQUITY – MFS (cont.)



Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.4%)MFS International Equity Fund 940,314 9,619,305 10,832,413



NET ASSETS (100%) 10,786,962




Nestlé 4 .1%Roche Holding AG 3 .4%Compass Group plc 3 .3%Bayer AG 3 .1%WPP Group plc 3 .1%Taiwan Semiconductor Manufacturing Company 2 .7%Reckitt Benckiser Group plc 2 .7%Danone 2 .6%Hoya Corporation 2 .5%AIA Group 2 .4%Pernod-Ricard SA 2 .3%Yum! Brands 2 .3%Terumo Corporation 2 .2%Novartis AG 2 .1%SAP SE 2 .1%Beiersdorf AG 2 .1%Air Liquide 2 .1%Schneider Electric 2 .0%UBS Group AG 1 .9%Canadian National Railway Company 1 .9%Diageo plc 1 .8%DBS Group Holdings Ltd 1 .8%Akzo Nobel NV 1 .7%Moet Hennessy Louis Vuitton 1 .7%ING Groep 1 .7%




Investment ObjectiveThe fundamental investment objective of this Fund is to provide investors with long-term capital growth based on an internationally diversified equity portfolio by investing primarily in Europe and the Far East .

Investment StrategyTo invest its assets primarily in the common shares of large corporations with attractive relative valuations located in many countries .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $








Foreign Equity

DFS GIF – INTERNATIONAL EQUITY – MFS (cont.)






%


June 30, 2016 $


December 31, 2015 $

MSCI EAFE Net 3 .00 342,158 392,372





June 30 2016

$

December 31 2015

$ASSETSCurrent AssetsCash 5,367 496 Investments at fair value through profit

or loss (FVTPL) 2,419,348 2,531,545 Premiums receivable 25 160 Receivable for securities sold 35,022 2,078

2,459,762 2,534,279 LIABILITIESCurrent LiabilitiesAccrued expenses 6,106 6,375 Withdrawals payable 35,333 2,397 Payable for securities purchased 4,872 135




Foreign Equity

DFS GIF – INTERNATIONAL EQUITY GROWTH – DESJARDINS


2016$

2015$



(239,293) 278,753



40,189 34,805

INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ATTRIBUTABLE TO CONTRACT OWNERS (279,482) 243,948













2016$

2015$



PremiumsSeries 5 123,160 204,812 Series 6 219,197 182,519 Series 7 — —

342,357 387,331

WithdrawalsSeries 5 (75,502) (113,555)Series 6 (99,294) (75,498)Series 7 — —

(174,796) (189,053)


2016$

2015$





Investments purchased (378,542) (347,641)Receivable for securities sold (32,944) —Accrued expenses (269) 1,305 Payable for securities purchased 4,737 110

NET CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES (195,761) (194,100)

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIESPremium payments 342,492 383,165 Amounts paid on withdrawals (141,860) (189,001)

NET CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES 200,632 194,164 Increase (Decrease) in cash/bank

overdraft 4,871 64 Cash (bank overdraft), beginning of

period 496 496

CASH (BANK OVERDRAFT), END OF PERIOD 5,367 560





Foreign Equity

DFS GIF – INTERNATIONAL EQUITY GROWTH – DESJARDINS (cont.)


Number of Units

Cost

$

Fair Value

$

INVESTMENT FUND (100.2%)Desjardins Overseas Equity Growth Fund, I-Class 137,307 2,375,101 2,419,348



NET ASSETS (100%) 2,413,451




Tencent Holdings 5 .2%Inditex 5 .0%Baidu, ADR 4 .8%AIA Group 4 .2%Softbank Corporation 3 .8%M3 3 .7%Alibaba Group Holding 3 .4%Rolls-Royce Holdings 3 .0%Atlas Copco 3 .0%L’Oréal 2 .9%Illumina 2 .8%ARM Holdings 2 .7%Rakuten 2 .3%ASML Holding 2 .3%Amazon .com 2 .2%Tesla Motors 2 .1%Zalando 2 .0%Prudential Financial 2 .0%Svenska Handelsbanken 2 .0%Novo Nordisk 1 .8%Investment AB Kinnevik 1 .8%SMC Corporation 1 .8%Cash and Cash Equivalents 1 .8%New Oriental Education & Technology Group 1 .5%Kering 1 .5%




Investment ObjectiveThe objective of this Fund is to achieve long-term capital growth by investing in equity and equity related securities of companies located or operating outside of North America, while when appropriate, also investing in equity and equity related securities of companies located or operating in emerging markets .

Investment StrategyInvestment decisions are backed by extensive research and analysis with preference given to those companies that can sustain above average growth in earnings and cash flow and whose securities are traded at a reasonable price . The investment approach involves a bottom-up, stock driven approach to country and sector allocation and more specifically, those companies with sustainable competitive advantages and strong management teams operating in a favourable market background and display solid financial characteristics .




June 30, 2016 Level 1 $

Level 2 $

Level 3 $

Total $



Level 2 $

Level 3 $

Total $













%


June 30, 2016 $


December 31, 2015 $

MSCI EAFE Net 3 .00 76,805 79,143




Foreign Equity

DFS GIF – INTERNATIONAL EQUITY GROWTH – DESJARDINS (cont.)


Six-months Periods ended June 30, 2016 and 2015

1. ESTABLISHMENT OF THE FUNDSThe Desjardins Financial Security Guaranteed Investment Funds (the “Funds”) consist of thirty-seven Funds established by Desjardins Financial Security Life Assurance Company (“Desjardins Financial Security” or the “Company”) in respect of individual variable insurance contracts issued under the Desjardins Financial Security Guaranteed Investment Funds Plan – Helios, Helios2, the Millennia III Plan and the Imperial Growth Plan . The assets of each Fund are segregated from the Company’s other assets and are owned by Desjardins Financial Security . The Funds are not separate legal entities . The Company’s head office is located at 200, rue des Commandeurs, Lévis, Québec, Canada G6V 6R2 .The Funds were established on the following dates by resolutions of the Board of Directors:

Series 1 Series 3 Series 5 Series 6 Series 7 Series IGPINVESTMENT SOLUTIONSConservative — — Oct . 19, 2015 Feb . 24, 2014 Feb . 24, 2014 —Moderate — — Oct . 19, 2015 Feb . 24, 2014 Feb . 24, 2014 —Balanced — — Oct . 19, 2015 Feb . 24, 2014 Feb . 24, 2014 —Growth — — Oct . 19, 2015 Feb . 24, 2014 Feb . 24, 2014 —Maximum Growth — — Oct . 19, 2015 Feb . 24, 2014 Feb . 24, 2014 —

INDIVIDUAL FUNDSIncomeMoney Market Nov . 15, 1995 Dec . 14, 1998 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 Nov . 7, 2014Income – Fiera Capital Nov . 15, 1995 Dec . 14, 1998 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Canadian Bond — — Oct . 19, 2015 Oct . 19, 2015 Oct . 19, 2015 —Balanced and Asset AllocationDiversified Income – Franklin Quotential — Oct . 30, 2000 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Balanced Income – Franklin Quotential — Oct . 30, 2000 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Canadian Balanced – Fidelity — Dec . 1, 2008 Dec . 1, 2008 Feb . 24, 2014 Feb . 24, 2014 —U .S . Monthly Income – Fidelity — — Oct . 19, 2015 Oct . 19, 2015 Oct . 19, 2015 —Balanced – Desjardins SocieTerra — — Oct . 19, 2015 Oct . 19, 2015 Oct . 19, 2015 —Global Balanced – Jarislowsky Fraser — Nov . 17, 2003 Oct . 29, 2007 Oct . 19, 2015 Oct . 19, 2015 —Canadian Balanced – Fiera Capital Nov . 15, 1995 Dec . 14, 1998 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Canadian Balanced – Franklin Bissett — Dec . 5, 2005 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Balanced Growth – Franklin Quotential — Dec . 11, 2006 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Canadian Balanced – CI Signature — — May 3, 2010 Feb . 24, 2014 Feb . 24, 2014 —Income and Growth – CI Signature — — Sep . 24, 2012 Feb . 24, 2014 Feb . 24, 2014 —Growth and Income – NEI Northwest — Dec . 11, 2006 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Global Growth – NEI Select — Jan . 14, 2002 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Canadian Asset Allocation – CI Cambridge — — Sep . 24, 2012 Feb . 24, 2014 Feb . 24, 2014 —Growth – Franklin Quotential — Oct . 30, 2000 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Canadian EquityDividend Income – Franklin Bissett — Apr . 17, 2000 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Canadian Dividend – NEI Northwest — — Sep . 24, 2012 Feb . 24, 2014 Feb . 24, 2014 —Canadian Equity – Jarislowsky Fraser — Dec . 5, 2005 Oct . 29, 2007 Oct . 19, 2015 Oct . 19, 2015 —Canadian Equity – Fidelity True North® — Dec . 1, 2008 Dec . 1, 2008 Feb . 24, 2014 Feb . 24, 2014 —Canadian Equity – Franklin Bissett — Apr . 17, 2000 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Canadian Equity – Fiera Capital Nov . 15, 1995 Dec . 14, 1998 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 Nov . 7, 2014Specialty Equity – NEI Northwest — Dec . 11, 2006 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Small Cap – Franklin Bissett — Apr . 17, 2000 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Foreign EquityAmerican Equity – MFS — Apr . 17, 2000 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —American Equity Value – Desjardins Nov . 15, 1995 Dec . 14, 1998 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —Global Dividend – Desjardins — — Sep . 24, 2012 Feb . 24, 2014 Feb . 24, 2014 —Global Equity – MFS — Dec . 1, 2008 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —International Equity – MFS Nov . 15, 1995 Dec . 14, 1998 Oct . 29, 2007 Feb . 24, 2014 Feb . 24, 2014 —International Equity Growth – Desjardins — — Sep . 24, 2012 Feb . 24, 2014 Feb . 24, 2014 —

The interim financial statements (“financial statements”) of the Funds are presented in Canadian dollars (CAD), the Funds’ functional and presentation currency .

NOTES TO THE FINANCIAL STATEMENTS – UNAUDITED


The main activities of the Funds are disclosed in the section “Strategy in Using Financial Instruments” in the section “Notes to the Financial Statements – Specific Information” pertaining to each Fund .In October 2015, the Company made modifications to the Fund names for the following Funds:

OLD FUND NAME NEW FUND NAMEDFS GIF – Diversified Income – Quotential DFS GIF – Diversified Income – Franklin Quotential DFS GIF – Balanced Income – Quotential DFS GIF – Balanced Income – Franklin Quotential DFS GIF – Canadian Balanced – Bissett DFS GIF – Canadian Balanced – Franklin Bissett DFS GIF – Balanced Growth – Quotential DFS GIF – Balanced Growth – Franklin Quotential DFS GIF – Growth – Quotential DFS GIF – Growth – Franklin Quotential DFS GIF – Dividend Income – Bissett DFS GIF – Dividend Income – Franklin Bissett DFS GIF – Canadian Equity – Bissett DFS GIF – Canadian Equity – Franklin Bissett DFS GIF – Small Cap – Bissett DFS GIF – Small Cap – Franklin Bissett DFS GIF – Income – Fiera DFS GIF – Income – Fiera Capital DFS GIF – Canadian Balanced – Fiera DFS GIF – Canadian Balanced – Fiera Capital DFS GIF – Canadian Equity – Fiera DFS GIF – Canadian Equity – Fiera Capital DFS GIF – Growth and Income – Northwest DFS GIF – Growth and Income – NEI Northwest DFS GIF – Canadian Dividend – Northwest DFS GIF – Canadian Dividend – NEI Northwest DFS GIF – Specialty Equity – Northwest DFS GIF – Specialty Equity – NEI Northwest DFS GIF – Global Growth – Northwest Select DFS GIF – Global Growth – NEI Select

In October 2015, the Company closed the following Funds:

FUND NAME

DFS GIF – Canadian Dividend – Fiera DFS GIF – Income – Beutel Goodman DFS GIF – Global High Income – Multi-managers DFS GIF – Balanced – Ethical DFS GIF – Global – Fidelity

2. BASIS OF PRESENTATION

International Financial Reporting Standards (“IFRS“)These financial statements have been prepared in compliance with International Financial Reporting Standards (“IFRS”), applicable to the preparation of financial statements . The Funds adopted this basis of accounting in 2014, as required by the Canadian Securities Administrator and the Canadian Accounting Standards Board .

Statement of Compliance The policies applied in these financial statements are based on IFRS in effect as of September 8, 2016, the date on which financial statements have been approved for publication by the Audit and Risk Management Committee of the Company .

Significant Accounting PoliciesThe significant measurement and presentation policies applied to prepare these financial statements are described below .

Financial Assets and LiabilitiesThe Funds’ financial assets consist primarily of investments in non-derivative financial instruments and derivative financial instruments presented in the schedule of investment portfolio . Financial liabilities consist primarily of derivative financial instruments . Financial assets and liabilities are recognized on the date the Funds become a party to the contractual provisions of the instrument, namely the trade date .

Classification of Financial InstrumentsThe Funds classify their financial assets and liabilities in the following categories:Financial assets at fair value through profit or loss (“FVTPL”):• Held for trading: derivative financial instruments;• Designated at FVTPL: all other investments including equity and fixed-income securities .Financial assets at amortized cost:• Loans and receivables: cash and all other receivables .

NOTES TO THE FINANCIAL STATEMENTS – unaudited (cont.)


Financial liabilities at FVTPL:• Held for trading: derivative financial instruments and short positions .Financial liabilities at amortized cost:• Bank overdraft and all other payables .A financial instrument is designated at FVTPL if it eliminates or significantly reduces a measurement or a recognition inconsistency that would otherwise arise from measuring assets or liabilities or recognizing the gains and losses on them on different bases .The Funds’ obligation concerning net assets attributable to Contract Owners is recorded at the redemption amount that approximates fair value . The accounting policies used to measure the fair value of investments and derivatives financial instruments are identical to those used in measuring the net asset value for transactions with Contract Owners except where the closing price for financial assets and liabilities is not within the bid-ask spread .As at June 30, 2016 and December 31, 2015, there are no differences between the Funds’ net asset value per unit for transactions and their net assets attributable to Contract Owners per unit, in accordance with IFRS .

Determination of the Fair Value of Financial InstrumentsFair value is the price that would be received from selling an asset or paid to transfer a liability in an ordinary transaction between market participants at the valuation date . The fair value of financial assets and liabilities traded in active markets are based on quoted market prices at the close of trading on the disclosure date and there is little subjectivity in its determination . The Funds use the closing price for both financial assets and financial liabilities where this price falls within the bid-ask spread . In circumstances where the closing price is not within the bid-ask spread, the Company determines the point within the bid-ask spread that is most representative of fair value based on the specific facts and circumstances .The fair value of financial assets and liabilities that are not traded in an active market, including over-the-counter derivative financial instruments, is determined using valuation techniques . The Funds use a variety of methods and make assumptions that are based on existing market conditions at each disclosure date .Valuation techniques include the use of comparable recent arm’s length transactions, the fair value of other instruments that are substantially the same, discounted cash flow analysis, option pricing models and other techniques commonly used by market participants and which make the maximum use of observable inputs . Refer to Note 7, “Financial Instruments Disclosures” for further information about the Funds’ fair value measurements .LiquidityCash (bank overdraft) is measured at cost, which closely approximates fair value .Money Market SecuritiesMoney market securities are recorded at cost, together with accrued interest, which closely approximates fair value .Equities and Index-Based InvestmentsEquity securities and index-based investments securities are recorded at the closing price of the accredited stock exchange on which the corresponding security is principally traded . Unlisted warrants are valued with a recognized valuation model, including Black & Scholes .Bonds, Mortgage-Backed Securities and Asset-Backed SecuritiesBonds, mortgage-backed securities and asset-backed securities are valued based on prices obtained from recognized securities dealers .Investment FundsUnits of underlying funds are generally valued based on the net asset value per unit provided by the underlying Fund’s manager at the end of each valuation day . Derivative Financial InstrumentsCertain Funds may use an array of derivative financial instruments such as foreign currency forward contracts, forward contracts and futures contracts for hedging purposes or purposes other than hedging, or both . The fair value of derivative financial instruments takes into account the impact of legally binding master netting agreements, if applicable . Refer to the section “Offsetting Financial Assets and Liabilities” for further information about the Fund’s offsetting section .

Foreign Currency Forward Contracts and Forward ContractsThe fair value of these instruments corresponds to the gains or losses that would result from the contract close-out on the valuation date; this value is recorded in “Unrealized appreciation (depreciation) on derivatives” in the Statement of Financial Position .

Futures ContractsFutures contracts are valued at fair value and are settled daily through brokers acting as intermediaries . Any amounts receivable (payable) from the settlement of futures contracts are recorded in “Receivable (Payable) on futures contracts” in the Statement of Financial Position .Valuation of Unlisted Securities and Other Investments When the valuation principles of the aforementioned investments are not appropriate, fair value is determined according to the Company’s best estimates, based on established valuation procedures and on prevailing market conditions on each valuation date . These procedures cover, amongst others, securities no longer traded, securities issued by private corporations and illiquid securities . For further information, refer to Note 3 “Critical Accounting Judgments, Estimates and Assumptions” .


Investment TransactionsInvestment transactions are accounted for on the trade date . Cost is determined on an average cost basis except for money market securities, for which the cost is determined using the First In First Out method . The average cost does not include amortization of premiums or discounts on fixed-income securities with the exception of stripped bonds . Transaction costs, such as brokerage commissions, incurred in the purchase and sale of securities by the Funds are recognized in the Statement of Comprehensive Income . The difference between the unrealized appreciation (depreciation) of investments at the beginning and at the end of the period is included in “Net unrealized gain (loss) on investments” in the Statement of Comprehensive Income . On disposal of an investment, the difference between the fair value and the cost of the investment is included in “Net realized gain (loss) on investments” in the Statement of Comprehensive Income .

Securities Lending and Repurchase TransactionsCertain Funds may enter into securities lending and repurchase transactions through the securities lending program of the Funds’ custodian, Desjardins Trust Inc . (Trust) .The loaned securities and repurchased securities are not derecognized in the Statement of Financial Position as substantially all the risks and advantages of ownership of these securities is kept . To limit the risk that the counterparty fails to fulfill its obligations, the Funds obtain collateral, representing at least 102% of the contract amount, determined daily based on the fair value of the previous business day’s loaned securities or repurchase transactions . Securities received as collateral in securities lending transactions are not recognized in the Statement of Financial Position as substantially all the risks and advantages of ownership of these securities have not been transferred to the Funds . Cash guarantees received for securities lending and repurchase transactions are recognized as financial assets in “Cash guarantee received for securities lending” and/or “Cash guarantee received for repurchase transactions”, as appropriate in the Statement of Financial Position . A liability representing the obligation to return the securities is recognized in “Commitments related to securities lending” and/or “Commitments related to repurchase transactions”, as appropriate .Revenue generated through the securities lending program is recognized at a rate presented in the “Notes to the Financial Statements – Specific Information” pertaining to each Fund . This revenue is included in “Revenue from securities lending and repurchase transactions” in the Statement of Comprehensive Income .Offsetting Financial Assets and Financial LiabilitiesFinancial assets and liabilities are offset in the Statement of Financial Position for the Funds if and only if a Fund has:• a legally enforceable and unconditional right to offset the recognized amounts and • an intention to settle on a net amount, or to close-out the asset and settle the liability simultaneously .The Funds have a legally enforceable and unconditional right to offset a financial asset and liability when they meet the following criteria:• the right is enforceable in the normal course of business and• the right is enforceable in the event of default, insolvency or bankruptcy .Over-the-counter derivative financial instruments, securities lending, repurchase transactions and receivable for investments sold and payable for investments purchased that are subject to master netting or similar agreements do not meet the criteria for offsetting in the Statement of Financial Position, as they give a right to an offset that is enforceable only in the event of default, insolvency or bankruptcy .

Other Assets and LiabilitiesPremiums receivable, receivable for securities sold, interest, dividends and other receivables and cash guarantee received for repurchase transactions are classified as loans and receivables and are recorded at cost .Similarly, accrued expenses, withdrawals payable, payable for securities purchased and interest, dividends and others payables, as well as commitments related to repurchase transactions, are classified as financial liabilities and recorded at amortized cost . Given their short-term maturity, their carrying amount approximates their fair value .

IncomeInterest for attribution purposes from investments in debt securities and presented in the Statement of Comprehensive Income is recognized as it is earned . The Funds do not amortize premiums paid or discounts received on the purchase of debt securities except for stripped bonds, which are amortized on a straight line basis . Dividends are recognized as income on the ex-dividend date . Interest and dividend distributions received from underlying funds are recorded at the date of distribution . Distributions received from income and royalty trust investments are classified as income, capital gains or return of capital based on amounts reported by the management of these trusts . If such specific information is not available, the Company will determine the split at its discretion . Foreign income is accounted for on a gross amount received and is included in the income section in the Statement of Comprehensive Income . On derivative financial instruments contract close-out, the gains and losses from financial derivative financial instruments held for hedging purposes are included in “Net realized gain (loss) on derivative” in the Statement of Comprehensive Income . Gains and losses from derivative financial instruments held for purposes other than hedging are included in “Net income (loss) from derivative financial instruments” in the Statement of Comprehensive Income .



Foreign Currency TranslationThe Funds’ premiums and withdrawals are denominated in Canadian dollars . Foreign currency assets and liabilities denominated in a foreign currency are translated into the functional currency at the exchange rate on each valuation date . Purchases and sales of securities, as well as income and expenses denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates . Foreign exchange gains and losses relating to cash are presented as “Foreign exchange gain (loss) on cash” and those relating to other financial assets and liabilities are presented within “Net realized gain (loss) on investments” and “Net unrealized gain (loss) on investments” in the Statement of Comprehensive Income .

Increase (Decrease) in Net Assets per Unit from Operations Attributable to Contract OwnersThe increase (decrease) in net assets per unit from operations attributable to Contract Owners, presented in the Statement of Comprehensive Income is calculated by dividing the increase (decrease) in net assets from operations attributable to Contract Owners per unit by the average number of units outstanding during the period .

Income TaxesUnder the Income Tax Act (Canada), each Fund is treated as a segregated fund trust . The Fund’s income, as well as gains or losses realized, if any, are allocated to Contract Owners on a regular basis . In the case of interest that accumulates in a registered account, Contract Owners will not receive annual tax slips . However, any amount paid to Contract Owners or former Contract Owners may be subject to be taxed in their hands . On the other hand, for interest that accumulates in a non-registered account, Contract Owners will receive an annual tax slip for any income, gains or losses allocated . Under current tax laws, Funds do not pay income taxes, with the exception of foreign tax withholdings that may apply .In certain circumstances, to avoid double taxation to the Contract Owners, the Funds adjust the cost of the investments held to properly reflect the adjusted cost base for tax purposes .

Investments in Entities The Funds meet the definition of IFRS 10, Consolidated Financial Statements, for investment entities and account for their investments in underlying funds at FVTPL . According to IFRS 12, Disclosure of Interests in Other Entities, the Funds must disclose specific information on their investments in other entities, such as Subsidiaries, Associates and Structured Entities .SubsidiariesAn entity, including investments in any other investment entity, is considered as a subsidiary when it is controlled by another entity . The Fund controls an entity when it has the right to variable returns from its involvement with the entity and through its power over the entity .AssociatesAssociates are investments in entities over which the Fund exercises significant influence without, however, exercising control . Structured EntitiesStructured Entities are conceived in a way that the right to vote and other similar rights are not determining factors in who exercises control . The Company has determined that its investments in underlying funds, index-based investments, asset-backed securities and mortgage-backed securities are Structured Entities, unless the specified relationship is different .

Refer to the section “Notes to the Financial Statements – Specific Information” pertaining to each Fund for more information on Investments in Entities .

Accounting Standard Issued but not yet AppliedIn July 2014, the International Accounting Standards Board (“IASB”) issued the complete and final version of IFRS 9, Financial Instruments (“IFRS 9”), which will replace IAS 39, Financial Instruments: Recognition and Measurement (“IAS 39”) . IFRS 9 includes, among others, the requirements for the classification and measurement of financial assets and liabilities .

IFRS 9 sets out a new classification and measurement model for financial assets to determine whether a financial asset should be classified at amortized cost, at FVTPL or at fair value through other comprehensive income . This model is based on the contractual cash flow characteristics of the financial asset and the business model under which the financial asset is held . The valuation basis of financial assets, namely amortized cost or fair value, may need to be changed, as well as the recognition of unrealized gains and losses arising from changes in fair value . For the classification and measurement of financial liabilities, the new standard essentially carries forward the current requirements under IAS 39 .The Funds will have to adopt IFRS 9 retrospectively for annual periods beginning on or after January 1, 2018 . However, the restatement of comparative periods is not mandatory as an exemption from applying the standard allows comparative periods to be presented in accordance with the previous GAAP under certain conditions . A team has been assigned to the project to highlight the following: the changes in disclosure and financial reporting as well as in systems and processes, disclosures and training . The project is progressing according to the proposed implementation schedule . The Manager continues to assess the impact of adopting IFRS 9 .

3. CRITICAL ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS

The preparation of financial statements requires the Management of the Company to use judgment in applying its accounting policies and to make estimates and assumptions about the future . Actual results may differ from these estimates . The following paragraphs discuss the most significant accounting judgments and estimates that the Funds have made in preparing the financial statements .


Fair Value Measurement of Derivatives Financial Instruments and Securities not Quoted in an Active Market

The Funds may hold financial instruments that are not quoted in active markets, including derivative financial instruments . Fair value is determined based on models that make maximum use of observable inputs and rely as little as possible on unobservable inputs . The Funds consider the data observable if market data is readily available, distributed or updated on a regular basis, reliable and verifiable, not proprietary and provided by independent sources that are actively involved in the relevant market . The models used to determine fair values are validated and periodically reviewed by experienced personnel of the Company .

When no quoted prices are available, the fair value is estimated using present value or other valuation methods, which are influenced by the assumptions used concerning the amount and timing of estimated future cash flows and discount rates, which reflect varying degrees of risk, including liquidity risk, credit risk, risks related to interest rates, exchange rates, and price and rate volatility .

The calculation of the fair values may differ given the role that judgment plays in applying the acceptable estimation and valuation techniques . Estimated fair value reflects market conditions on a given date and for this reason, it may not be representative of future fair values . Refer to Note 7, “Financial Instruments Disclosures” for further information on fair value measurement of financial instruments .

Classification and Measurement of Investments and Application of the Fair Value Option

In classifying and measuring financial instruments held by the Funds, the Company is required to make significant judgments about whether or not the business of the Funds is to invest on a total return basis for the purpose of applying the fair value option for financial assets under IAS 39 . The most significant judgment lies in determining if certain investments are held-for-trading, and if the fair value option can be applied to those which are not . For further information on financial instruments, refer to Note 2, “Basis of Presentation” .

4. NET ASSETS ATTRIBUTABLE TO CONTRACT OWNERS

Structure of the Funds and the Units attributedThe Funds are wholly owned assets of Desjardins Financial Security, which have been segregated from the Company’s other assets . Except for instances where the Company has acquired an interest in a Fund, the Funds’ assets may only be used to pay benefits under the Contracts .Each Fund has a series of units, which are attributed to Contracts for the purpose of determining the value of benefits to the units attributable to those Contracts . A Contract Owner acquires no direct claim on the units or assets of a Fund by purchasing a Contract but only the benefits that are provided under the Contract .Units within the same series of Funds have the same net asset value per unit . Subject to the Company’s administrative rules, Contract Owners have the right to make transactions under their Contracts such as premiums, withdrawals and switches between units of Funds . As a result of these transactions, units are attributed to and withdrawn from the Contract based on each Contract’s terms and conditions or as provided by law . Since the Contract Owner does not own units of a Fund, ownership of units cannot be sold or transferred to another party . There are no voting rights associated with the units of the Fund .

Classification of Units Attributable to Contract OwnersThe Funds’ outstanding units qualify as “puttable instruments” as required by the IAS 32, Financial Instruments: Presentation (“IAS 32”) . IAS 32 states that units that include a contractual obligation for the issuer to repurchase or redeem them for cash or another financial asset should be classified as financial liabilities . The Funds issue different series of units attributable to Contract Owners that are equally subordinated but have different features .The Funds issue series of units to Contract Owners that include a contractual obligation for the issuer to repurchase or redeem them for cash or another financial asset . These series of units attributable to Contract Owners have different characteristics and are therefore classified as financial liabilities .

Valuation of the UnitsThe units of a Fund are valued according to the administrative rules established by the Company and in accordance with the Contract and all laws and regulations applicable to the Funds .These units differ with respect to redemption charges and management fees charged to each series (See Note 5) . The net asset value per unit is determined on each market day by dividing the net assets attributable to Contract Owners by its outstanding units .

Series of units availableThe Desjardins Financial Security Guaranteed Investment Funds Plan, the Millennia III Plan, and the Imperial Growth Plan, as well as the various Contract versions offered under each of these Plans, offers different Series providing different guarantees and provisions as well as varying Management Expense Ratios (MERs) .Series 1: This Series was offered under the Millennia III Plan through two different Contracts: the Millennia lll and Millennia lll – New Era Contracts . The Millennia III Plan was offered from November 15, 1995 to October 28, 2007 .Series 3: This Series was offered under the Millennia III Plan through two different Contracts: the Millennia lll – Classic and Millennia lll – New Era Contracts . The Millennia III Plan was offered from November 15, 1995 to October 28, 2007 .



Series 5: This Series was offered under the Desjardins Financial Security Guaranteed Investment Funds Plan through the Helios Contract . The Desjardins Financial Security Guaranteed Investment Funds Plan was first offered starting on October 29, 2007 and currently, the only Contract available is the Helios2 Contract .Series 6: This Series was offered under the Desjardins Financial Security Guaranteed Investment Funds Plan through the Helios2 Contract . The Desjardins Financial Security Guaranteed Investment Funds Plan was first offered starting on October 29, 2007 and currently, the only Contract available is the Helios2 Contract .Series 7: This Series was offered under the Desjardins Financial Security Guaranteed Investment Funds Plan through the Helios2 Contract . The Desjardins Financial Security Guaranteed Investment Funds Plan was first offered starting on October 29, 2007 and currently, the only Contract available is the Helios2 Contract .Series IGP: This Series was offered under the Imperial Growth Plan through the three remaining Contracts (C71, C81, and C88) . The Imperial Growth Plan was offered pre-1995 .

Number of UnitsThe number of units outstanding in each Fund as at June 30, 2016 and 2015, and the number of units attributed to and withdrawn from Contracts during the periods are as follows:

Outstanding Units2016


Attributed Units2016


Withdrawn Units2016

Withdrawn Units2015

INVESTMENT SOLUTIONSConservative

Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101,084 — 114,941 — 27,254 —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,750,092 1,030,128 667,624 556,231 280,067 76,389 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300,109 116,254 207,214 114,197 145,505 1,861

Moderate Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103,508 — 89,612 — 5,590 —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,986,592 1,683,835 854,009 825,828 269,550 108,804 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 435,445 62,666 258,254 176 37,512 —

Balanced Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92,883 — 80,461 — 292 — Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,547,081 2,883,075 1,901,523 1,243,279 202,569 62,865 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,075,078 220,391 122,255 110,083 55,024 28,869

GrowthSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265,972 — 332,907 — 83,242 — Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,128,760 1,793,394 1,142,756 957,026 329,066 74,382 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 223,669 96,206 111,520 2,650 68,869 544

Maximum Growth Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,695 — 24,534 — 1,235 — Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 397,297 276,722 103,398 96,680 49,791 12,100 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,854 3,854 — — — —

INDIVIDUAL FUNDSIncome Money Market

Series 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69,121 77,332 7,536 90 6,969 10,442 Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 441,913 470,468 85,927 69,454 132,194 49,698 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,822,746 2,740,578 660,989 615,655 837,532 849,957 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,883,754 958,703 942,985 937,180 757,429 303,672 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 354,762 168,885 309,469 195,972 116,917 194,544 Series IGP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 182,697 168,300 31,257 18,985 19,904 36,035

Income – Fiera Series 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 204,021 287,760 394 4,190 51,959 17,526 Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 963,808 716,079 32,936 36,906 138,074 107,066 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,268,533 8,112,588 358,482 282,085 854,629 806,183 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,443,326 740,554 446,786 323,606 99,509 64,581 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,698 28,771 5,783 17,543 9,496 131

Canadian BondSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,335,686 — 459,330 — 749,735 —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 744,761 — 258,586 — 19,638 — Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,899 — — — 61 —






Withdrawn Units2016

Withdrawn Units2015

Balanced and Asset Allocation Diversified Income – Franklin Quotential

Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 816,229 897,027 76,445 77,594 137,775 110,811 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,244,303 22,904,178 1,152,571 1,125,554 2,098,864 2,105,696 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,964,489 2,633,077 1,229,807 1,287,564 212,021 148,142 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 574,334 135,513 83,084 112,373 5,424 160

Balanced Income – Franklin Quotential Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,372,557 1,530,408 71,369 88,912 176,982 175,438 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32,174,841 34,318,029 1,480,580 1,509,426 2,687,477 2,883,100 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,844,465 1,516,437 1,035,245 660,509 171,695 37,178 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 907,162 394,601 2,397 106,074 111,588 3,556

Canadian Balanced – Fidelity Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,169,100 1,146,291 138,868 131,679 175,946 117,493 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88,454,895 93,265,987 4,822,445 4,452,320 7,783,607 7,475,089 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,328,974 2,747,466 1,026,194 1,729,630 433,197 464,280 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 200,650 115,646 58,521 39,890 91,578 1,042

U .S . Monthly Income – FidelitySeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 492,393 — 409,222 — 42,456 —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 711,990 — 424,549 — 40,652 —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107,517 — 75,400 — 13,359 —

Balanced – Desjardins SocieTerraSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,409,532 — 116,313 — 95,403 —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 751,022 — 563,226 — 35,824 —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88,820 — 92,659 — 7,885 —

Global Balanced – Jarislowsky Fraser Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,213,812 1,053,668 88,788 81,575 110,908 94,367 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,242,676 18,240,212 3,448,537 1,385,634 2,457,349 1,487,572 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,076,584 — 2,667,587 — 143,844 —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 279,640 — 176,576 — 13,926 —

Canadian Balanced – Fiera CapitalSeries 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 763,183 878,930 5,549 6,128 51,690 94,002 Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,405,191 1,768,615 26,697 67,851 172,654 164,965 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,047,976 14,218,178 553,538 461,203 1,348,242 1,230,791 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,650,315 815,983 318,477 500,386 68,914 30,638 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98,074 95,690 — 36,471 882 915

Canadian Balanced – Franklin BissettSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 865,059 1,084,208 49,576 39,026 194,501 164,114 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,622,371 25,563,062 789,080 817,842 2,281,540 3,140,031 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,506,610 4,236,803 945,774 1,294,923 403,714 394,379 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 510,169 420,125 14,522 185,051 5,311 15,762

Balanced Growth – Franklin Quotential Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,988,548 2,059,313 131,744 119,721 179,672 241,716 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75,326,984 78,091,352 3,868,774 3,127,836 6,111,071 5,670,090 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,149,090 2,857,135 1,120,485 1,372,259 234,274 102,946 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 628,712 138,655 148,714 53,461 43,875 870

Canadian Balanced – CI SignatureSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,640,593 13,572,606 721,279 1,572,463 1,112,380 1,041,937 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,482,163 2,990,194 687,833 1,601,972 409,728 195,308 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 376,108 235,145 86,449 123,129 49,527 7,566

Income and Growth – CI SignatureSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,586,380 8,482,858 377,260 1,032,579 1,348,961 782,050 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,786,481 2,575,219 783,313 1,481,505 246,381 111,430 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183,744 160,454 41,038 74,367 50,446 7,154

Growth and Income – NEI Northwest Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369,120 475,641 25,247 18,132 54,157 57,677 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,765,229 23,433,388 1,144,497 782,603 2,094,549 2,003,618 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,975,968 1,668,694 763,637 751,504 177,491 205,678 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 163,461 101,153 29,193 16,460 1,709 700







Withdrawn Units2016

Withdrawn Units2015

Global Growth – NEI SelectSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 512,986 574,366 7,065 11,723 48,955 53,464 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,857,539 8,941,339 660,474 448,619 664,643 511,719 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,247,778 1,025,238 596,962 566,636 283,045 26,726 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 219,580 44,106 54,172 16,821 14,276 708

Canadian Asset Allocation – CI CambridgeSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 869,561 845,968 62,890 120,007 59,317 94,026 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,052,918 486,828 306,239 268,747 70,461 23,808 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54,119 4,203 57,780 356 40,392 —

Growth – Franklin Quotential Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 425,962 497,872 46,251 12,171 37,878 61,219 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,451,986 9,249,569 140,775 129,472 706,696 553,014 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 540,812 319,340 91,966 240,360 48,349 31,840 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,270 4,455 — 558 12 —

Canadian EquityDividend Income – Franklin Bissett

Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,352,063 2,471,360 54,726 74,993 443,536 332,146 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,447,508 8,309,592 222,671 363,862 1,476,064 1,220,709 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,285,324 991,509 143,843 255,035 86,386 96,975 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115,883 92,797 23,287 20,978 1,229 41,171

Canadian Dividend – NEI NorthwestSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,364,547 2,516,978 221,249 527,317 281,817 385,178 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 509,348 341,269 153,766 161,584 51,543 24,351 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,864 3,864 — — — —

Canadian Equity – Jarislowsky FraserSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 583,836 765,030 8,255 13,697 97,237 112,765 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,054,579 23,384,677 146,550 218,674 1,392,849 2,059,575 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77,908 — 59,822 — 957 —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,000 — — — — —

Canadian Equity – Fidelity True North®Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124,700 112,599 24,440 28,103 22,846 17,476 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,052,052 2,173,575 248,945 202,818 348,188 254,669 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,595,251 927,118 514,066 576,622 97,142 122,092 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169,515 83,180 7,712 69,063 22,697 588

Canadian Equity – Franklin Bissett Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,301,601 1,547,399 34,888 40,393 162,372 191,887 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 996,194 1,240,536 70,349 64,621 156,244 191,546 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 528,562 465,905 89,250 129,329 66,777 98,000 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,673 3,866 60 122 3,680 1

Canadian Equity – Fiera CapitalSeries 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,535,205 1,409,536 10,232 19,206 102,550 120,756 Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,018,096 1,173,232 23,156 24,503 90,048 121,480 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 376,773 427,238 25,575 21,494 45,382 43,699 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93,937 83,109 12,046 43,059 3,473 6,452 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,304 8,311 — — 4 356 Series IGP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 299,702 377,145 870 947 40,788 100,292

Specialty Equity – NEI NorthwestSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 529,069 617,035 7,085 11,246 48,760 92,592 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,829,943 2,051,139 208,989 214,321 326,687 480,108 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 278,931 193,529 56,929 94,655 42,326 34,441 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,054 4,054 — — — —

Small Cap – Franklin BissettSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443,193 531,398 7,889 6,704 52,030 82,763 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 524,543 635,678 45,032 39,355 85,457 142,995 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 448,014 384,526 99,867 136,653 47,854 83,349 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,933 7,172 76 139 146 18,526






Withdrawn Units2016

Withdrawn Units2015

Foreign EquityAmerican Equity – MFS

Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 633,599 681,682 41,735 36,421 94,768 108,615 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,457,702 1,453,389 177,220 312,475 255,712 131,286 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 910,012 418,187 262,448 252,396 72,383 16,434 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,491 22,229 11,264 18,347 2 —

American Equity Value – DesjardinsSeries 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 352,490 318,598 6,081 17,601 24,083 15,620 Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 371,651 368,851 34,566 43,676 64,062 61,097 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,336,034 1,330,455 240,361 383,321 254,912 116,918 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 781,077 472,978 183,204 310,407 83,629 31,259 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,610 70,101 4,661 46,576 56,790 5,310

Global Dividend – DesjardinsSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,171,552 1,044,820 191,775 327,702 124,765 128,944 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,447,473 663,894 585,626 368,453 112,004 35,484 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93,273 39,052 70,218 35,497 45,687 3,227

Global Equity – MFS Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 634,447 50,444 37,742 10,086 98,194 2,717 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,549,041 5,585,406 222,849 61,317 1,100,091 239,729 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 314,243 85,142 81,628 62,809 5,766 514 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,799 3,940 25,877 — 18 —

International Equity – MFSSeries 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 333,649 351,582 3,459 11,668 18,873 21,369 Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 734,176 823,862 34,937 30,272 78,010 140,134 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 568,193 583,974 38,079 71,810 53,600 81,528 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162,161 49,298 25,595 46,414 18,451 48 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,532 25,532 — 10,175 — —

International Equity Growth – DesjardinsSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202,070 190,615 17,106 25,450 10,272 14,402 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193,152 136,782 44,627 33,057 20,627 13,456 Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,150 4,150 — — — —

5. MANAGEMENT FEES AND OTHER EXPENSES

Management feesIn return for investment management, Desjardins Financial Security is paid a management fee from the Funds based on the net asset value of the units attributed to each series of each Fund and calculated daily .The management fees, as a percentage of the daily average net assets, are as follows:

Series 1%

Series 3%

Series 5%

Series 6%

Series 7%

Series IGP%

INVESTMENT SOLUTIONSConservative — — 2 .05 1 .95 1 .50 —Moderate — — 2 .05 2 .00 1 .55 —Balanced — — 2 .10 2 .00 1 .55 —Growth — — 2 .15 2 .05 1 .60 —Maximum Growth — — 2 .15 2 .05 1 .60 —

INDIVIDUAL FUNDSIncomeMoney Market 0 .75 0 .75 0 .75 0 .80 0 .35 1 .30Income – Fiera Capital 1 .50 1 .38 1 .09 1 .35 0 .90 —Canadian Bond — — 1 .09 1 .35 0 .90 —



Series 1%

Series 3%

Series 5%

Series 6%

Series 7%

Series IGP%

Balanced and Asset AllocationDiversified Income – Franklin Quotential — 1 .90 1 .96 2 .20 1 .75 —Balanced Income – Franklin Quotential — 1 .90 1 .96 2 .15 1 .70 —Canadian Balanced – Fidelity — 2 .02 2 .02 2 .20 1 .75 —U .S . Monthly Income – Fidelity — — 2 .40 2 .30 1 .85 —Balanced – Desjardins SocieTerra — — 1 .88 2 .15 1 .70 —Global Balanced – Jarislowsky Fraser — 2 .10 1 .69 2 .10 1 .65 —Canadian Balanced – Fiera Capital 2 .00 1 .65 1 .68 2 .00 1 .55 —Canadian Balanced – Franklin Bissett — 1 .95 1 .75 2 .00 1 .55 —Balanced Growth – Franklin Quotential — 1 .90 1 .96 2 .15 1 .70 —Canadian Balanced – CI Signature — — 1 .89 2 .15 1 .70 —Income and Growth – CI Signature — — 2 .20 2 .20 1 .75 —Growth and Income – NEI Northwest — 2 .22 2 .03 2 .20 1 .75 —Global Growth – NEI Select — 2 .33 2 .10 2 .30 1 .85 —Canadian Asset Allocation – CI Cambridge — — 2 .20 2 .05 1 .60 —Growth – Franklin Quotential — 2 .15 2 .21 2 .20 1 .75 —Canadian EquityDividend Income – Franklin Bissett — 2 .06 1 .75 2 .15 1 .70 —Canadian Dividend – NEI Northwest — — 2 .20 2 .15 1 .70 —Canadian Equity – Jarislowsky Fraser — 2 .15 1 .69 2 .10 1 .65 —Canadian Equity – Fidelity True North® — 2 .02 2 .02 2 .25 1 .80 —Canadian Equity – Franklin Bissett — 2 .18 1 .75 2 .10 1 .65 —Canadian Equity – Fiera Capital 2 .00 1 .63 1 .59 1 .95 1 .50 1 .80Specialty Equity – NEI Northwest — 2 .35 2 .16 2 .40 1 .95 —Small Cap – Franklin Bissett — 2 .25 2 .01 2 .40 1 .95 —Foreign EquityAmerican Equity – MFS — 2 .25 1 .71 2 .15 1 .70 —American Equity Value – Desjardins 2 .00 1 .69 2 .06 2 .10 1 .65 —Global Dividend – Desjardins — — 2 .20 2 .20 1 .75 —Global Equity – MFS — 1 .78 1 .78 2 .25 1 .80 —International Equity – MFS 2 .00 1 .95 1 .69 2 .25 1 .80 —International Equity Growth – Desjardins — — 2 .20 2 .20 1 .75 —

Operating expensesIn addition to management fees, a charge is applied to each Fund for operating and administrative expenses relating to the Fund . Each Fund is also responsible for all applicable taxes, including Goods and Services Tax (“GST”) and Harmonized Sales Tax (“HST”) if any, and all brokerage commissions incurred by a Fund in buying and selling investments on behalf of a Fund .

Management Expense RatiosSome expenses (audit fees, legal fees, custodial fees, marketing costs, etc .) have been absorbed by the Company . Management expense ratios for all the Funds would be nine basis points higher if these expenses had been charged to the Funds . The Company does not intend to change its method of allocating costs .The management expense ratios for the period ended June 30, 2016 and for each of the past five years, which includes management, guarantee and operating expenses, are as follows*:

June 30 2016

%

December 31 2015

%

December 31 2014

%

December 31 2013

%

December 31 2012

%

December 31 2011

%INVESTMENT SOLUTIONSConservative

Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.59 2 .59** — — — —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.47 2 .49 2 .51** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.88 2 .01 2 .01** — — —


June 30 2016

%

December 31 2015

%

December 31 2014

%

December 31 2013

%

December 31 2012

%

December 31 2011

%Moderate

Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.70 2 .64** — — — —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.49 2 .51 2 .54** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.90 1 .90 2 .07** — — —

BalancedSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.76 2 .70** — — — —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.54 2 .57 2 .57** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.08 2 .13 2 .13** — — —

Growth Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.82 2 .76** — — — —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.59 2 .68 2 .68** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.10 2 .18 2 .18** — — —

Maximum GrowthSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.87 2 .81** — — — —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.67 2 .71 2 .71** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.24 2 .24 2 .24** — — —

INDIVIDUAL FUNDSIncomeMoney Market***

Series 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.72 1 .72 1 .72 1 .72 1 .55 1 .55Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.71 1 .72 1 .73 1 .72 1 .55 1 .55Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.38 1 .39 1 .39 1 .40 1 .25 1 .25Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.12 1 .10 1 .11** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.61 0 .63 0 .63** — — —Series IGP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.66 1 .66 1 .67** — — —

Income – Fiera CapitalSeries 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.93 2 .93 2 .94 2 .93 2 .65 2 .65Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.61 2 .61 2 .62 2 .61 2 .33 2 .33Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.96 1 .96 1 .96 1 .95 1 .75 1 .75Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.77 1 .79 1 .80** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.22 1 .31 1 .32** — — —

Canadian BondSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.96 1 .96** — — — —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.77 1 .75** — — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.22 1 .32** — — — —

Balanced and Asset AllocationDiversified Income – Franklin Quotential

Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.14 3 .13 3 .14 3 .15 2 .80 2 .80Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.91 2 .92 2 .92 2 .92 2 .60 2 .60Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.71 2 .68 2 .72** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.20 2 .27 2 .30** — — —

Balanced Income – Franklin QuotentialSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.20 3 .20 3 .20 3 .20 2 .85 2 .85Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.95 2 .95 2 .95 2 .94 2 .60 2 .60Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.76 2 .75 2 .74** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.30 2 .30 2 .30** — — —

Canadian Balanced – FidelitySeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.39 3 .41 3 .41 3 .40 3 .00 3 .00Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.96 2 .96 2 .96 2 .96 2 .65 2 .65Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.81 2 .82 2 .83** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.28 2 .34 2 .36** — — —

U .S . Monthly Income – FidelitySeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.10 3 .04** — — — —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.99 2 .93** — — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.47 2 .42** — — — —



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Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.81 2 .81** — — — —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.76 2 .74** — — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.30 2 .30** — — — —

Global Balanced – Jarislowsky Fraser Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.39 3 .40 3 .40 3 .40 3 .00 3 .00Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.85 2 .85 2 .86 2 .86 2 .55 2 .55Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.63 2 .59** — — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.24 2 .24** — — — —

Canadian Balanced – Fiera Capital***Series 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.83 3 .83 3 .82 3 .82 3 .40 3 .40Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.19 3 .20 3 .19 3 .19 2 .85 2 .85Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.55 2 .55 2 .55 2 .55 2 .30 2 .30Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.57 2 .59 2 .60** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.08 2 .12 2 .13** — — —

Canadian Balanced – Franklin BissettSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.18 3 .17 3 .19 3 .18 2 .85 2 .85Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.77 2 .77 2 .77 2 .77 2 .50 2 .50Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.60 2 .59 2 .61** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.11 2 .10 2 .00** — — —

Balanced Growth – Franklin Quotential Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.26 3 .27 3 .27 3 .29 2 .95 2 .95Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.97 2 .97 2 .97 2 .97 2 .65 2 .65Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.80 2 .79 2 .80** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.34 2 .36 2 .36** — — —

Canadian Balanced – CI SignatureSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.99 2 .99 2 .99 2 .99 2 .68 2 .68Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.79 2 .78 2 .77** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.29 2 .34 2 .36** — — —

Income and Growth – CI SignatureSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.05 3 .05 3 .07 3 .07 2 .75** —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.90 2 .85 2 .84** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.36 2 .32 2 .47** — — —

Growth and Income – NEI Northwest Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.64 3 .64 3 .64 3 .64 3 .22 3 .22Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.94 2 .94 2 .94 2 .94 2 .65 2 .65Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.85 2 .87 2 .86** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.30 2 .41 2 .41** — — —

Global Growth – NEI SelectSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.85 3 .85 3 .85 3 .86 3 .43 3 .43Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.13 3 .12 3 .12 3 .12 2 .80 2 .80Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.98 2 .98 3 .02** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.40 2 .59 2 .59** — — —

Canadian Asset Allocation – CI CambridgeSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.90 2 .89 2 .91 2 .95 2 .65** —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.70 2 .68 2 .69** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.19 2 .30 2 .30** — — —

Growth – Franklin Quotential Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.61 3 .61 3 .62 3 .61 3 .20 3 .20Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.22 3 .22 3 .21 3 .21 2 .85 2 .85Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.89 2 .92 2 .93** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.45 2 .47 2 .47** — — —


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Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.40 3 .39 3 .39 3 .39 3 .05 3 .05Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.93 2 .93 2 .94 2 .94 2 .65 2 .65Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.70 2 .70 2 .72** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.17 2 .13 2 .10** — — —

Canadian Dividend – NEI NorthwestSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.08 3 .08 3 .08 3 .09 2 .70** —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.87 2 .85 2 .90** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.41 2 .41 2 .41** — — —

Canadian Equity – Jarislowsky FraserSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.59 3 .58 3 .59 3 .59 3 .20 3 .20 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.92 2 .91 2 .92 2 .91 2 .60 2 .60 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.93 2 .87** — — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.41 2 .36** — — — —

Canadian Equity – Fidelity True North®

Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.56 3 .59 3 .62 3 .62 3 .20 3 .20 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.20 3 .20 3 .21 3 .20 2 .85 2 .85 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.04 3 .05 3 .04** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.46 2 .58 2 .59** — — —

Canadian Equity – Franklin Bissett Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.59 3 .59 3 .59 3 .59 3 .20 3 .20 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.97 2 .97 2 .98 2 .98 2 .70 2 .70 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.80 2 .79 2 .83** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.41 2 .41 2 .41** — — —

Canadian Equity – Fiera CapitalSeries 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.82 3 .82 3 .82 3 .82 3 .42 3 .42 Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.18 3 .18 3 .18 3 .17 2 .85 2 .85 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.54 2 .54 2 .54 2 .54 2 .30 2 .30 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.70 2 .67 2 .67** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.24 2 .24 2 .24** — — —Series IGP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.22 2 .17 2 .22** — — —

Specialty Equity – NEI NorthwestSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.82 3 .83 3 .83 3 .83 3 .40 3 .40 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.28 3 .27 3 .28 3 .29 2 .90 2 .90 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.21 3 .21 3 .24** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.76 2 .76 2 .76** — — —

Small Cap – Franklin BissettSeries 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.76 3 .74 3 .75 3 .75 3 .37 3 .37 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.14 3 .13 3 .13 3 .13 2 .85 2 .85 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.14 3 .12 3 .15** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.74 2 .56 2 .76** — — —

Foreign EquityAmerican Equity – MFS***

Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.75 3 .76 3 .77 3 .76 3 .34 3 .34 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.93 2 .93 2 .94 2 .97 2 .65 2 .65 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.87 2 .88 2 .87** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.44 2 .47 2 .47** — — —

American Equity Value – DesjardinsSeries 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.82 3 .81 3 .82 3 .82 3 .41 3 .41 Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.22 3 .23 3 .24 3 .24 2 .90 2 .90 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.05 3 .06 3 .07 3 .08 2 .75 2 .75 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.83 2 .79 2 .76** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.27 2 .25 2 .41** — — —



June 30 2016

%

December 31 2015

%

December 31 2014

%

December 31 2013

%

December 31 2012

%

December 31 2011

%Global Dividend – Desjardins

Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.80 2 .79 2 .78 2 .90 2 .55** —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.87 2 .83 2 .86** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.34 2 .47 2 .47** — — —

Global Equity – MFS***Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.36 3 .39 3 .39 3 .47 3 .05 3 .05 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.92 2 .92 2 .92 2 .92 2 .60 2 .60 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.93 2 .95 3 .00** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.53 2 .53 2 .53** — — —

International Equity – MFS*** Series 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.82 3 .83 3 .85 3 .85 3 .50 3 .50 Series 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.65 3 .64 3 .65 3 .65 3 .25 3 .25 Series 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.75 2 .76 2 .76 2 .77 2 .45 2 .45 Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.01 3 .05 3 .03** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.55 2 .59 2 .59** — — —

International Equity Growth – DesjardinsSeries 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.10 3 .11 3 .10 3 .22 2 .80** —Series 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.93 2 .92 2 .94** — — —Series 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.53 2 .53 2 .53** — — —

* Starting in 2013, management expense ratios include all applicable sales taxes (sales taxes not included before 2013) .** Annualized . *** The management expense ratios for these Funds include underlying fund managers’ fees, ranging from 0 .01 to 0 .05% .

6. RELATED PARTY TRANSACTIONSThe Funds pay management fees and operating expenses to the Company, which are presented in the Statement of Comprehensive Income . Those fees are calculated on a daily basis with the net asset value of the Fund . The management fees are paid monthly at the annual rate specified in Note 5 . Accrued expenses, presented in the Statement of Financial Position, are to be paid to the Company .Some Funds have investments in underlying funds from related parties . As at June 30, 2016 and December 31, 2015, the Company had the following seed capital investments:

June 30, 2016$

December 31, 2015$

Conservative 145,218 141,919Moderate 172,598 169,802Balanced 199,721 197,511Growth 228,790 227,584Maximum Growth 255,799 255,521Money Market 82,774 82,464Income – Fiera Capital 22,652 21,886Canadian Bond 22,204 21,451 Diversified Income – Franklin Quotential 21,886 21,797Balanced Income – Franklin Quotential 21,951 22,256Canadian Balanced – Fidelity 22,927 22,336U .S . Monthly Income – Fidelity 435,109 443,758 Balanced – Desjardins SocieTerra 139,490 139,525 Global Balanced – Jarislowsky Fraser 76,357 77,425 Canadian Balanced – Fiera Capital 22,624 22,113Canadian Balanced – Franklin Bissett 121,502 116,535Balanced Growth – Franklin Quotential 21,862 22,440Canadian Balanced – CI Signature 216,356 219,294Income and Growth – CI Signature 201,815 203,815Growth and Income – NEI Northwest 61,133 60,970Global Growth – NEI Select 22,373 22,518


June 30, 2016$

December 31, 2015$

Canadian Asset Allocation – CI Cambridge 229,968 226,885Growth – Franklin Quotential 21,822 22,777Dividend Income – Franklin Bissett 39,781 36,927Canadian Dividend – NEI Northwest 241,792 231,804Canadian Equity – Jarislowsky Fraser 21,657 20,657 Canadian Equity – Fidelity True North® 138,026 133,480Canadian Equity – Franklin Bissett 20,332 18,612Canadian Equity – Fiera Capital 41,004 38,843Specialty Equity – NEI Northwest 273,046 245,362Small Cap – Franklin Bissett 18,035 15,725American Equity – MFS 25,661 27,133American Equity Value – Desjardins 784,274 819,806Global Dividend – Desjardins 269,993 268,529Global Equity – MFS 231,537 247,098International Equity – MFS 21,738 24,386International Equity Growth – Desjardins 236,209 265,511

The related parties transactions are in the normal course of operations and are measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties .

7. FINANCIAL INSTRUMENTS DISCLOSURES

DFS Preliminary Information The net assets of the DFS Guaranteed Investment Funds are held by the Company on behalf of all Contract Owners . These Funds are not separate legal entities . The Contract Owners do not own any of the assets of the Funds nor own an interest in the Funds . However, the financial instrument risks resulting from the Funds are assumed by the Contract Owners . The segregated Fund’s value may increase or decrease according to market fluctuations .Moreover, the Funds are offered with a deposit guarantee of 75 to 100% that protects the deposits until specific maturity dates .For the Fund of funds, details regarding the top holdings of the underlying fund(s) are shown in the appendix of the schedule of investment portfolio .

Hierarchy of Financial Instruments at Fair ValueThe fair value measurement of financial instruments is determined using the following three levels of the fair value hierarchy:• Level 1 – Measurement based on quoted prices (unadjusted) in active markets for identical assets or liabilities;• Level 2 – Valuation techniques based primarily on observable market data;• Level 3 – Valuation techniques not based primarily on observable market data .If inputs of different levels are used to measure the fair value of an asset or liability, the classification within the hierarchy is based on the lowest level input that is significant to the measurement of fair value .

Measurement MonitoringThe Company is responsible for establishing the fair value measurements included in the Funds’ financial statements, including Level 3 measurements . The Company obtains prices from a pricing agency, monitors and analyzes these prices on a daily basis . A Measurement Monitoring Committee established by the Company ensures that appropriate operating procedures and a proper monitoring structure are in place and followed . Monthly monitoring reports are prepared and sent to each member for approval . The Measurement Monitoring Committee verifies the measurements on a monthly basis . On a quarterly basis, this committee examines and approves the Level 3 measurements after obtaining confirmation of the measurements from each portfolio manager, as needed . The committee signs off on any adjustments made to prices or estimates provided by the pricing agency .

Classification within the Fair Value HierarchyA change in the fair value measurement method could result in a transfer between levels . The Funds’ policy is to record the implications of transfers between levels on the date of the event or change in circumstances behind the transfer .The following types of investments may be classified Level 3 if their prices are no longer based on observable inputs .

a) Money Market SecuritiesMoney market securities primarily include public sector and corporate securities, which are valued using models with inputs including interest rate curves, credit spreads and volatilities . The inputs that are significant to valuation are generally observable . Public sector money market securities guaranteed by the federal and provincial government have been classified as Level 1 . Other money market securities have been classified as Level 2 .



b) EquitiesEquities are classified as Level 1 when the security is actively traded and a reliable price is observable . Certain equities do not trade frequently and therefore observable prices may not be available . In such cases, fair value is determined using observable market data and the fair value is classified as Level 2, unless the determination of fair value requires significant unobservable data, in which case the measurement is classified as Level 3 . Unlisted warrants are generally classified as Level 2 .

c) Index-Based InvestmentsIndex-based Investments are classified as Level 1 when the security is actively traded and a reliable price is observable .

d) BondsPublic sector bonds guaranteed by the federal and provincial government are classified as Level 1 . Corporate bonds, which are valued using models with inputs including interest rate curves, credit spreads and volatilities are usually classified as Level 2 .

e) Mortgage-backed Securities and Asset-backed SecuritiesMortgage-backed securities and asset-backed securities consist primarily of corporate securities, which are valued using models with inputs including interest rate curves, credit spreads and volatilities . Since the inputs that are significant to valuation are generally observable, mortgage-backed securities and asset-backed securities are usually classified as Level 2 .

f) Investment FundsPublic investment funds are classified as Level 1 when their prospectus is unrestricted and their price is reliable and observable . Since some investment funds are not public, their price is determined using observable market data and fair value is classified as Level 2, unless the measurement of fair value requires the use of significant unobservable inputs, in which case it is classified as Level 3 .

g) Derivative Financial InstrumentsDerivative instruments consist of foreign currency forward contracts for which counterparty credit spreads are observable and reliable or for which the credit-related inputs are determined to be significant to fair value, are classified as Level 2 .Detailed information concerning the fair value hierarchy of each Fund is available in their respective Notes to the Financial Statements pertaining to each Fund . For securities classified as Level 3, the valuation techniques and assumptions are also presented in their respective notes .

Management of Risks Arising from Financial Instruments During the course of their activities, the Funds are exposed to a variety of risks associated with financial instruments such as market risk (including currency risk, interest rate risk and price risk), concentration risk, credit risk and liquidity risk . The overall strategy of the Funds’ risk management focuses on the unpredictability of financial markets and optimizes the Funds’ financial performance, in accordance with the risk level established for the Fund . Most investments involve a risk of loss .For the purpose of the financial statements, certain risks detailed in the Contract and Information Folder are associated with other risks . The market risk, the special equity risk and the sovereign risk are presented under price risk . The credit risk and the derivatives risk are presented under credit risk .In accordance with the Funds’ investment policy, the Company monitors the Funds’ risks on a quarterly basis .

Market RiskMarket risk is the risk that the fair value or future cash flows associated with a financial instrument will fluctuate because of a change in the relevant risk variables, such as interest rates and equity prices .The Funds’ market risk is managed through diversification of the investment portfolio’s exposure ratios . The return on investments held by the Funds is monitored by the Company on a monthly basis and reviewed by the investment committee on a quarterly basis .

Currency RiskCurrency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate as a result of changes in foreign exchange rates . Currency risk is composed of monetary items (usually including cash, receivable amounts in foreign currencies, and investments in fixed-income and money market securities) and non-monetary items (usually including investments in equities and investment funds) . The non-monetary assets are classified according to the currency in which the security was purchased .The Funds are exposed to the currency risk in holding assets and/or liabilities denominated in currencies other than the Canadian dollar, the Funds’ functional currency, as the value of the securities denominated in other currencies will fluctuate according to the prevailing exchange rates . The Funds may enter into foreign currency forward contracts to reduce their exposure to currency risk .The Funds’ exposure to currency risk is shown based on the carrying value of financial assets and financial liabilities (including the notional amount of foreign currency forward contracts and foreign currency futures, if any) .If the Canadian dollar decreases in relation to foreign currencies, the value of foreign investments increases . Conversely, if the value of the Canadian dollar increases, the value of foreign investments decreases .


Interest Rate RiskInterest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate as a result of changes in market interest rates .Interest rate risk occurs when an investment fund invests in interest-bearing financial instruments . Generally, the value of these securities increases if interest rates decrease, and decreases if interest rates increase . The Company manages this risk by calculating and monitoring the average effective duration of the portfolio of these securities and the exposures on different points along the interest rate yield curve . The Funds also hold a limited amount of cash subject to variable interest rates, which expose them to cash flow interest rate risk .

Price RiskPrice risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate as a result of changes in market prices, other than those arising from currency risk or interest rate risk .The Company manages this risk by carefully selecting securities and other financial instruments, in accordance with defined limits . The maximum risk resulting from financial instruments is determined by the fair value or contract value of the financial instruments . The Funds’ overall market positions are monitored on a monthly basis by the Company and reviewed on a quarterly basis by the investment committee . The Funds’ financial instruments are exposed to price risk arising from uncertainties about the future prices of instruments .

Concentration RiskConcentration risk arises as a result of the concentration of exposures within the same category, whether it is geographical location or industry sector . For Funds with an international investment strategy, the concentration by geographic location is presented according to, among other things, the country of incorporation or region . For Funds with a domestic investment strategy, the concentration by industry sector is presented according to, among other things, their investments in finance, healthcare or energy sectors, etc . The concentration risk is managed through portfolio diversification within the framework of the Funds’ objective and strategy .

Credit RiskCredit risk is the risk that the financial instrument counterparty will be unable to pay the full amount at maturity . The Funds’ credit risk is managed through an independent credit analysis from the Manager/sub-advisor, in addition to credit rating agencies analysis .

Financial Instrument TransactionsThe Funds are exposed to credit risk . The Funds’ and counterparty’s respective credit risks are taken into account when determining the fair value of financial assets and liabilities . Transactions are settled or paid on delivery using approved brokers . The risk of default is considered limited as delivery of the securities sold is made once the broker has received payment .Payment is made on a purchase once the securities have been received by the broker . The trade will fail if either party fails to meet its obligations . However, there are risks involved in dealing with custodians or prime brokers who settle trades and, in rare circumstances, the securities and other assets deposited with the custodian or broker may be exposed to credit risk with regard to such parties . In addition, there may be practical problems or time delays associated with enforcing the Funds’ rights to their assets in the case of an insolvency of any such party .The investment grade for fixed-income securities and money market securities is rated by credit rating agencies, such as the Dominion Bond Rating Service (“DBRS”), Standard & Poor’s and Moody’s . In cases where the credit rating agencies do not agree on a credit rating for fixed-income securities and money market securities, they will be classified following these rules:• If two credit ratings are available, but the ratings are different, the lowest rating is used;• If three credit ratings are available, the most common credit rating is used;• If all three credit rating agencies have different ratings, the middle credit rating is used .The credit rating is then converted to DBRS format . Generally, the greater the credit rating of a security, the lower the probability of it defaulting on its obligations .Derivative financial instruments are financial contracts whose value depends on underlying assets, including interest rates and foreign exchange rates . The vast majority of derivative financial instruments is negotiated by mutual agreement between the Funds and their counterparties, and include foreign currency forward contracts, swaps and options . Other transactions are carried out as part of trades and mainly consist of futures contracts .

Securities Lending and Repurchase TransactionsSecurities lending and repurchase transactions expose the Funds to credit risk . These transactions are governed by Investment Industry Regulatory Organization of Canada participation agreements . The Funds also use netting agreements with counterparties to mitigate credit risk and require a percentage of collateralization (a pledge) on these transactions . The Funds only accept pledges from counterparties that comply with the eligibility criteria defined in their policies . These criteria promote quick realization, if necessary, of collateral in case of default . The collateral received and given by the Funds are mainly cash and government securities . Further information on assets pledged and received as collateral is presented in the “Notes to the Financial Statements – Specific Information” pertaining to each Fund .

Liquidity RiskLiquidity risk is the risk that the Fund will encounter difficulty in meeting obligations associated with financial liabilities .The Funds are exposed to daily cash redemptions of units . Most of their assets are therefore invested in liquid investments (i .e . investments that are traded in an active market and that can be readily disposed of) .



Some Funds may invest in derivatives financial instruments, debt securities and unlisted equity investments that are not traded in an active market . As a result, some Funds may not be able to quickly liquidate their investments at amounts approximating their fair values, or be able to respond to specific effects such as deterioration in the creditworthiness of any particular issuer . Units attributable to Contract Owners are redeemable on demand at the owner’s option . However, the Company does not expect that the contractual maturity disclosed will be representative of the actual cash outflows, as Contract Owners of the instruments typically retain them for a longer period .The majority of the remaining liabilities are due within the next 3 months . Balances due within 12 months equal their carrying balances as the impact of discounting is not significant .

Management of Risks from Units Attributable to Contract OwnersUnits attributed and outstanding are considered as the Funds’ capital . The Funds are not subject to specific capital requirements on the premiums and withdrawals, other than certain minimum subscription requirements . Contract Owners are entitled to require payment of the net asset value per unit for all or any of the units they hold by giving an official notice to the Company within the prescribed time period . Units attributable to Contract Owners are redeemable for cash equal to a pro rata share of the Funds’ net asset value .Additional InformationFor further information regarding the hierarchy of financial instruments at fair value measurement and risk exposure of each Fund, please refer to the “Notes to the Financial Statements – Specific Information” pertaining to each Fund . Details on risks and various documents on underlying funds (detailed description of each Fund’s investment policy and, where applicable, the investment policy and/or prospectus and financial statements of the underlying fund(s)) are available upon request by writing to the Company at its address:1 Complexe DesjardinsP .O . Box 9000Montreal, QuebecH5B 1H5

8. EVENTS SUBSEQUENT TO THE DATE OF THE STATEMENT OF FINANCIAL POSITIONLaunch of new Fund in Series 1 and IGPIn November 2016, the DFS GIF – Canadian Equity – Franklin Bissett will be added to Series 1 and Series IGP .

Closing of FundIn November 2016, the Company will close the DFS GIF – Canadian Equity – Fiera Capital .On September 2, 2016, the Company ceased to accept additional deposits in this Fund .


082

76E

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Desjardins Insurance refers to Desjardins Financial Security Life Assurance Company.

This document is printed on Rolland Enviro paper.

100%

The Contract and Information Folder contains important information on the DFS Guaranteed Investment Funds. Please read it carefully before investing. DFS Guaranteed Investment Funds is a registered trademark owned by Desjardins Financial Security Life Assurance Company. DFS Guaranteed Investment Funds are established by Desjardins Financial Security Life Assurance Company.

DFS stands for Desjardins Financial Security.

desjardinslifeinsurance.comThis Document is also available on our website:

Thank you.Thank you for choosing the strength and stability of a company specialized in providing individual insurance and retirement savings products to over five million Canadians, every day, to ensure their financial security.

Thank you for also choosing Desjardins Group, the largest cooperative financial group in Canada, whose financial stability is recognized by the following credit ratings which are comparable, if not superior to those of the five largest Canadian banks and insurance companies:

• Standard and Poor’s A+ • Moody’s Aa2• Dominion Bond Rating Service AA• Fitch AA-

http://www.desjardinslifeinsurance.com

2016 semi-annual report - desjardins life insurance€¦ · quarterly, this team makes an analysis...

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