cimb islamic dali equity fund financial statement …€¦ · cimb islamic dali equity fund...

CIMB ISLAMIC DALI EQUITY FUND FINANCIAL STATEMENT FOR THE FINANCIAL YEAR ENDED 31 MAY 2017

CIMB ISLAMIC DALI EQUITY FUND

CONTENTS PAGE(S) INVESTORS' LETTER 1 MANAGER'S REPORT 2 - 7

Fund Objective and Policy Performance Data Market Review Fund Performance Portfolio Structure Market Outlook Investment Strategy Unit Holdings Statistics Soft Commissions and Rebates

STATEMENT BY MANAGER 8 TRUSTEE'S REPORT 9 SHARIAH ADVISER’S REPORT 10 INDEPENDENT AUDITORS’ REPORT 11 - 14 STATEMENT OF COMPREHENSIVE INCOME 15 STATEMENT OF FINANCIAL POSITION 16 STATEMENT OF CHANGES IN EQUITY 17 STATEMENT OF CASH FLOWS 18 NOTES TO THE FINANCIAL STATEMENTS 19 - 60 DIRECTORY 61 LIST OF CWA (an Agency force of CIMB-Principal) OFFICES 62 - 66


1

INVESTORS’ LETTER Dear Valued Investors, Thank you for your continued support and for the confidence that you have placed in us. We are pleased to share that CIMB-Principal Asset Management Berhad (“CIMB-Principal”) Malaysia concluded the year with RM48 billion in Asset Under Management (“AUM”) and the CIMB-Principal’s Group AUM has increased by 7.6% to RM67.6 billion, for 1-year period ending 31 December 2016. Our AUM for Private Retirement Scheme (“PRS”) business has increased by 27% year-on-year (“y-o-y”) to RM343 million as at 31 December 2016. We continue to achieve prestigious recognitions from The Edge | Thomson Reuters Lipper Fund Awards: The Edge| Thomson Reuters Lipper Malaysia Fund Awards 2017

Best Equity Global, 3 years & 5 years : CIMB-Principal Global Titans Fund

Best Equity Asia Pacific Ex-Japan, 5 years : CIMB-Principal Asian Equity Fund

Best Equity Asia Pacific Ex-Japan - Malaysia Islamic, 5 years : CIMB Islamic Asia Pacific Equity Fund

Thomson Reuters Lipper Fund Award Global Islamic 2016

Best Equity Asia Pacific Ex-Japan (Islamic), 3 years : CIMB Islamic Asia Pacific Equity Fund

These awards reflect our consistent fund performance, in tandem with our commitment to provide the best customer experience to you. CIMB-Principal was also awarded Fund House of the Year in Malaysia by AsianInvestor for its Asset Management Awards 2017, its second consecutive win and The Employees' Provident Fund ("EPF") External Portfolio Managers Awards 2017 for the Best Global Bond Portfolio Manager. These industry recognitions reflect our success in scaling up our investment capabilities while building a solid track record and earning the trust of our clients over time. We are also happy to share with you that in line with CIMB Group’s policy to enhance customer experience, we have further expanded the payment options offered; CIMB-Principal has introduced the Virtual Account facility effective 7 December 2016. Please contact your servicing CWA Consultant or our Customer Care Centre at 03-77183000 to find out more. Thank you. Yours faithfully, for CIMB-Principal Asset Management Berhad

Munirah Khairuddin Chief Executive Officer/Executive Director


2

MANAGER’S REPORT

FUND OBJECTIVE AND POLICY

What is the investment objective of the Fund? The Fund aims to achieve a consistent capital growth over the medium to long-term. Has the Fund achieved its objective? The Fund has achieved its objective to achieve capital growth over the medium to long-term. What are the Fund investment policy and principal investment strategy? The Fund is a Shariah-compliant equity growth fund and is a continuation of CIMB Islamic DALI Equity Growth Fund. It may invest a minimum of 70% and up to a maximum of 98% of its Net Asset Value (“NAV”) principally in Shariah-compliant equities aim to provide growth but may also invest in other Shariah-compliant investments, such as Sukuk with a minimum credit rating of “A3” or “P2” by RAM Ratings (“RAM”) or equivalent rating by Malaysian Rating Corporation Berhad (“MARC”) or by local rating agency(ies) of the country; “BBB” by Standard & Poor’s (“S&P”) or equivalent rating by Moody’s or Fitch. The Fund may opt to invest in Shariah-compliant foreign equities up to a maximum of 30% of its NAV. Such foreign equities must be equity securities of companies domiciled in, listed in and/or have significant operations in countries in the Asia Pacific ex Japan. ‘Significant operations’ means major businesses of the company. For example, the Fund can invest in a company with significant business and/or operations in Thailand but listed on the New York Stock Exchange (“NYSE”). The threshold for ‘significant operations’ would be if more than 30% of total group revenue derives from countries in Asia Pacific ex Japan. The calculation would be based on the most recent financial reports released by the companies (e.g. interim and annual reports). In line with its objective, the investment strategy and policy of the Fund is to rebalance the portfolio to suit market conditions in order to reduce short-term volatility and provide consistency in capital growth. Between 70% to 98% (both inclusive) of the Fund’s NAV will be invested in Shariah-compliant securities and other Shariah-compliant investments, and at least 2% of the Fund’s NAV in Shariah-compliant liquid assets.

Fund category/type Equity (Shariah-compliant)/Growth How long should you invest for? Recommended three (3) years or more Indication of short-term risk (low, moderate, high) Moderate When was the Fund launched? 30 April 2003 What was the size of the Fund as at 31 May 2017? RM999.51 million (843.70 million units) What is the Fund’s benchmark? 70% Financial Times Stock Exchange (“FTSE”) Bursa Malaysia (“FBM”) EMAS Shariah (“FBMS”) Index + 30% Morgan Stanley Capital International All Country ("MSCI AC") Asia ex Japan Islamic Index Note: The benchmark is customised as such to align it closer to the structure of the portfolio and to reflect the composition of the portfolio in line with the markets they operate in and its objectives.

What is the Fund distribution policy? The Manager has the discretion to distribute part or all of the Fund’s distributable income. The distribution (if any) may vary from period to period depending on the investment objective and the performance of the Fund.


3

FUND OBJECTIVE AND POLICY (CONTINUED) What was the net income distribution for the financial year ended 31 May 2017? The Fund distributed a total net income of RM43.23 million to unit holders for the financial year ended 31 May 2017. As a result of the distribution, the NAV per unit dropped from RM1.1248 to RM1.0629 on 27 June 2016. PERFORMANCE DATA Details of portfolio composition of the Fund for the last three financial years are as follows:

31.05.2017 31.05.2016 31.05.2015

% % %

Shariah-compliant collective investment scheme 0.40 0.47 -

Shariah-compliant quoted securities

- Basic Materials 3.25 1.17 3.40

- Construction 7.98 5.44 5.34

- Consumer Products 8.01 10.80 8.95

- Energy 3.80 3.01 0.56

- Finance 2.31 2.44 3.35

- Health Care - 0.73 2.36

- Industrials 8.44 11.70 11.13

- Infrastructure Project Companies (“IPC”) 5.82 5.03 3.73

- Plantation 5.44 2.55 -

- Properties 1.05 1.14 0.49

- Real Estate Investment Trusts ("REITs") 2.94 1.67 1.27

- Technology 7.18 6.55 6.78

- Telecommunications 2.64 4.30 2.57

- Trading/Services 27.88 26.78 32.69

- Utilities - 0.94 0.97

Cash and other net assets 12.86 15.28 16.41

100.00 100.00 100.00

Performance details of the Fund for the last three financial years are as follows:

31.05.2017 31.05.2016 31.05.2015

NAV (RM Million) 999.51 743.69 298.85

Units in circulation (Million) 843.70 655.68 239.12

NAV per unit (RM) 1.1846 1.1342 1.2497

Highest NAV per unit (RM) 1.2010 1.2572 1.2915

Lowest NAV per unit (RM) 1.0629 1.0930 1.1358

Total return (%) 10.52 (3.51) 6.85

- Capital growth (%) 4.43 (9.29) 0.92

- Income distribution (%) 5.27 6.38 5.85


4

PERFORMANCE DATA (CONTINUED)

31.05.2017 31.05.2016 31.05.2015

Management Expense Ratio ("MER") (%) ^ 2.07 2.10 2.04

Portfolio Turnover Ratio ("PTR") (times) # 1.10 1.47 0.90 ^ The Fund’s MER decreased from 2.10% to 2.07% mainly due to the increase average NAV during

the financial year under review. # The Fund’s PTR decreased from 1.47 times to 1.10 times due to less trading done during the

financial year to position the Fund.

Date of distribution 27.06.2016 24.06.2015 26.06.2014

Gross distribution per unit (sen) 6.20 7.50 7.00

Net distribution per unit (sen) 6.20 7.50 6.98

31.05.2017 31.05.2016 31.05.2015 31.05.2014 31.05.2013

% % % % %

Annual total return 10.52 (3.51) 6.85 7.87 18.32

(Launch date: 30 April 2003) Past performance is not necessarily indicative of future performance and that unit prices and investment returns may go down, as well as up. All performance figures for the financial year have been extracted from Lipper.

MARKET REVIEW (1 JUNE 2016 TO 31 MAY 2017) Foreign Equity During the financial year under review, Asian equity markets rose by 25%, led by synchronized global growth in major countries (US, Europe, Japan and Emerging Markets (“EM”)), stable to low bond yields and a stable US Dollar (“USD”) supporting cyclical assets like Asian equities. Loose monetary policies by the European Union (“EU”) and Japan spurred the rally in Equities. Apart from a temporary volatility during President Trump’s victory at the US Presidential Election in late 2016, Asian equity markets were trending upwards in most parts. China’s supply side reforms led to a global rally in the Materials sector much to investors surprise while the Technology sector also benefited from expectations of higher component specifications upgrade and supply shortages. Local Equity For the domestic market, the market took a serious dip with Donald Trump’s surprise election win caught many by surprise. The unnerving event saw market confidence waiver towards year-end in anticipation of policy concerns head of his inauguration come next year. For 2017, the market ended the financial year on a stronger note rallying 5.77% for the quarter driven by net foreign inflows. The Government-Linked Companies (“GLCs”) restructuring story continued to unfold, led by UMW Holdings Bhd and Sime Darby Bhd in the consumer discretionary and industrial sectors. Concerns about the large 10-year Malaysian Government Securities (“MGS”) redemptions were unwarranted, as yield remained stable at 4.04%, while the Malaysian Ringgit (“MYR”) firmed 0.3% month-on-month (“m-o-m”) to RM4.44 against the USD.


5

FUND PERFORMANCE

1 year to

31.05.2017

3 years to 31.05.2017

5 years to 31.05.2017

Since inception to 31.05.2017

% % % %

Income 5.27 18.54 33.74 92.99

Capital 4.43 (4.40) 8.08 76.68

Total Return 10.52 13.95 45.44 245.05

Benchmark 13.77 10.09 35.17 188.06

Average Total Return 10.52 4.45 7.78 9.18 For the financial year under review, the Fund’s total return rose by 10.52%, while the benchmark rose by 13.77%. The Fund underperformed its benchmark by 325 basis points (“bps”). On 3-years and 5-years, the Fund’s total return had grown by 13.95% and 45.44%, which outperformed the benchmark by 386 bps and 1,027 bps respectively. Since inception, the Fund has outperformed the benchmark by 56.99%.

Changes in NAV

31.05.2017 31.05.2016 Changes

%

NAV (RM Million) 999.51 743.69 34.40

NAV/Unit (RM) 1.1846 1.1342 4.44 The Fund’s NAV grew by 34.40% mostly driven by inflows. Meanwhile, the NAV per unit increased by 4.44% due to market rally during the financial year, which resulted in increase in the Fund’s equity holdings. Performance data represents the combined income and capital return as a result of holding units in the Fund for the specified length of time, based on NAV to NAV price. The performance data assumes that all earnings from the Fund are reinvested and are net of management and trustee fees. Past performance is not reflective of future performance and income distributions are not guaranteed. Unit prices and income distributions, if any, may fall and rise. All performance figures for the financial year have been extracted from Lipper.

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

200%

220%

240%

260% CIMB Islamic Dali Equity Fund

70% FBMS Index + 30% MSCI AC Asia ex Japan Islamic Index


6

PORTFOLIO STRUCTURE Asset allocation

(% of NAV) 31.05.2017 31.05.2016

Shariah-compliant collective investment scheme 0.40 0.47

Shariah-compliant quoted securities - local 58.76 59.21

Shariah-compliant quoted securities - foreign 27.98 25.04

Cash and other net assets 12.86 15.28

TOTAL 100.00 100.00

There was an increase in Shariah-compliant foreign quoted securities and a decrease in cash and other net assets given that market has performed strongly. MARKET OUTLOOK* We continue to remain positive on Asian equities with synchronized global growth (US, Europe, Japan and EM), stable to low bond yields (10 year US Treasury yields (“UST”) at 2.15% to 2.50%) and a stable USD supporting cyclical asset classes like Asian equities. China has achieved financial stability by controlling capital outflows and tightening shadow banking (even though it is not deleveraging with total debt or Gross Domestic Product (“GDP”) at 260% and still rising). Funds continue to flow into Asian equities and earnings estimates continue to see upgrades. With consensus expecting 20% and 10% earnings growth, 14 times and 13 times of Price-to-Earning Ratio (“PE”) for 2017 and 2018, Asia is reasonably priced. We think Asian equities could see higher Return on Equity driven by rising dividend payout, better capital management (Capital Expenditures, Mergers and acquisitions (“M&A”) and restructuring) and fatter margins. * This market outlook does not constitute an offer, invitation, commitment, advice or recommendation to make a purchase of any investment. The information given in this article represents the views of CIMB-Principal or based on data obtained from sources believed to be reliable by CIMB-Principal. Whilst every care has been taken in preparing this, CIMB-Principal makes no guarantee, representation or warranty and is under no circumstances liable for any loss or damage caused by reliance on, any opinion, advice or statement made in this market outlook.

INVESTMENT STRATEGY Foreign Equity The Fund is fully invested with exposure to themes such as; • China’s supply side reforms, affecting industries such as steel and cement; • Component shortages and technology roadmap for mobile devices; • Industrial PC and Internet of Things; • Consumer discretionary with sub-themes such as propensity for travel as the middle income

class grows; and • Defensive growth: India data consumption through new operator entrant and tower operator. Local Equity For domestic equities, we expect the market to continue to be supported by foreign inflows from funds that remain very underweight on Malaysia. The trend remains bullish with local selling remaining well absorbed by foreign buying. We anticipate corporate earnings upgrades to continue to drive the market higher. We continue to overweight cyclical sectors like oil and gas, consumer discretionary and tourism-related companies. GLCs restructuring and e-commerce companies remain core holdings in our portfolios.


7

UNIT HOLDINGS STATISTICS Breakdown of unit holdings by size as at 31 May 2017 are as follows:

Size of unit holdings (units)

No. of unit holders

No. of units held (million)

% of units held

5,000 and below 49,541 41.78 4.95

5,001-10,000 9,731 71.02 8.42

10,001-50,000 15,578 342.72 40.62

50,001-500,000 3,391 333.30 39.50

500,001 and above 33 54.88 6.51

Total 78,274 843.70 100.00

SOFT COMMISSIONS AND REBATES CIMB-Principal Asset Management Berhad (the “Manager”) and the Trustee (including their officers) will not retain any form of rebate or soft commission from, or otherwise share in any commission with, any broker in consideration for directing dealings in the investments of the Funds unless the soft commission received is retained in the form of goods and services such as financial wire services and stock quotations system incidental to investment management of the Funds. All dealings with brokers are executed on best available terms. During the financial year under review, the Manager and Trustee did not receive any rebates from the brokers or dealers but have retained soft commission in the form of goods and services such as financial wire services and stock quotations system incidental to investment management of the Funds.


8

STATEMENT BY MANAGER TO THE UNIT HOLDERS OF CIMB ISLAMIC DALI EQUITY FUND We, being the Directors of CIMB-Principal Asset Management Berhad (the “Manager"), do hereby state that, in the opinion of the Manager, the accompanying audited financial statements set out on pages 15 to 60 are drawn up in accordance with the provisions of the Deeds and give a true and fair view of the financial position of the Fund as at 31 May 2017 and of its financial performance, changes in equity and cash flows for the financial year then ended in accordance with the provisions of the Malaysian Financial Reporting Standards (“MFRS”) and International Financial Reporting Standards (“IFRS”). For and on behalf of the Manager CIMB-Principal Asset Management Berhad (Company No.: 304078-K) MUNIRAH KHAIRUDDIN ALEJANDRO ECHEGORRI Chief Executive Officer/Executive Director Executive Director Kuala Lumpur 31 July 2017


9

TRUSTEE'S REPORT TO THE UNIT HOLDERS OF CIMB ISLAMIC DALI EQUITY FUND We, Universal Trustee (Malaysia) Berhad, being the Trustee of CIMB Islamic DALI Equity Fund (the “Fund”), are of the opinion that CIMB-Principal Asset Management Berhad (the “Manager”), acting in the capacity of the Manager of the Fund, have fulfilled their duties in the following manner for the financial year ended 31 May 2017: (a) the Fund is being managed in accordance with the limitations imposed on the investment

powers of the Manager and the Trustee under the Deeds, the Securities Commission’s Guidelines on Unit Trust Funds, the Capital Markets and Services Act 2007 and other applicable laws;

(b) valuation/pricing is carried out in accordance with the Deeds and relevant regulatory requirements; and

(c) creation and cancellation of units are carried out in accordance with the Deeds and relevant regulatory requirements.

During the financial year, a total distribution of 6.20 sen per unit (gross) has been distributed to the unit holders of the Fund. We are of the view that the distribution is consistent with the objective of the Fund. For and on behalf of the Trustee, UNIVERSAL TRUSTEE (MALAYSIA) BERHAD ONG TEE VANN Chief Executive Officer Kuala Lumpur 31 July 2017


10

SHARIAH ADVISER’S REPORT TO THE UNIT HOLDERS OF CIMB ISLAMIC DALI EQUITY FUND We have acted as the Shariah Adviser of CIMB Islamic DALI Equity Fund (the “Fund”) for the financial year ended 31 May 2017. Our responsibility is to ensure that the procedures and processes employed by CIMB-Principal Asset Management Berhad (the “Manager”) are in accordance with Shariah and Shariah Investment Guidelines. In our opinion, the Manager has managed and administered the Fund in accordance with the Shariah Investment Guidelines of the Fund and complied with applicable guidelines, rulings or decisions issued by the Securities Commission Malaysia pertaining to Shariah matters for the financial year ended 31 May 2017. In addition, we also confirm that the investment portfolio of the Fund comprises securities which have been classified as Shariah-compliant by the Shariah Advisory Council of the Securities Commission Malaysia (“SACSC) and where applicable Shariah Advisory Council of Bank Negara Malaysia with the exception of Hume Industries Bhd and Sunway Construction Group Bhd. However, the securities had been fully disposed on 27 October 2016 and 5 July 2016 respectively. This report is made solely to the unit holders of the Fund, as a body, and for no other purpose. We do not assume responsibility to any other person for the content of this report and we shall not be liable for any errors or non-disclosure on the part of the Manager. For and on behalf of Shariah Adviser CIMB Islamic Bank Berhad ASHRAF GOMMA ALI Regional Head, Shariah & Governance/Designated Person Responsible for Shariah Advisory Kuala Lumpur 31 July 2017


11

INDEPENDENT AUDITORS’ REPORT TO THE UNIT HOLDERS OF CIMB ISLAMIC DALI EQUITY FUND REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS Our opinion In our opinion, the financial statements of CIMB Islamic DALI Equity Fund (the “Fund”) give a true and fair view of the financial position of the Fund as at 31 May 2017, and of its financial performance and its cash flows for the year then ended in accordance with Malaysian Financial Reporting Standards and International Financial Reporting Standards. What we have audited We have audited the financial statements of the Fund, which comprise the statement of financial position as at 31 May 2017, and the statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, as set out on pages 15 to 60. Basis for opinion We conducted our audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing. Our responsibilities under those standards are further described in the “Auditors’ responsibilities for the audit of the financial statements” section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence and other ethical responsibilities We are independent of the Fund in accordance with the By-Laws (on Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants (“By-Laws”) and the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (“IESBA Code”), and we have fulfilled our other ethical responsibilities in accordance with the By-Laws and the IESBA Code.


12

INDEPENDENT AUDITORS’ REPORT TO THE UNIT HOLDERS OF CIMB ISLAMIC DALI EQUITY FUND (CONTINUED) REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED) Information other than the financial statements and auditors’ report thereon The Manager of the Fund is responsible for the other information. The other information comprises Manager’s report but does include the financial statements of the Fund and our auditor’s report thereon. Our opinion on the financial statements of the Fund does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements of the Fund, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements of the Fund or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Manager for the financial statements The Manager of the Fund is responsible for the preparation of the financial statements of the Fund that give a true and fair view in accordance with Malaysian Financial Reporting Standards and International Financial Reporting Standards in Malaysia. The Manager is also responsible for such internal control as the Manager determine is necessary to enable the preparation of financial statements of the Fund that are free from material misstatement, whether due to fraud or error. In preparing the financial statements of the Fund, the Manager is responsible for assessing the Fund’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Manager either intend to liquidate the Fund or to cease operations, or have no realistic alternative but to do so.


13

INDEPENDENT AUDITORS’ REPORT TO THE UNIT HOLDERS OF CIMB ISLAMIC DALI EQUITY FUND (CONTINUED) REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED) Auditors’ responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements of the Fund as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with approved standards on auditing in Malaysia and International Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: (a) Identify and assess the risks of material misstatement of the financial statements of the Fund,

whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

(b) Obtain an understanding of internal control relevant to the audit in order to design audit

procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control.

(c) Evaluate the appropriateness of accounting policies used and the reasonableness of

accounting estimates and related disclosures made by the Manager. (d) Conclude on the appropriateness of the Manager’s use of the going concern basis of

accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Fund’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements of the Fund or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Fund to cease to continue as a going concern.

(e) Evaluate the overall presentation, structure and content of the financial statements of the

Fund, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.


14

INDEPENDENT AUDITORS’ REPORT TO THE UNIT HOLDERS OF CIMB ISLAMIC DALI EQUITY FUND (CONTINUED) REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED) Auditors’ responsibilities for the audit of the financial statements (continued) We communicate with the Manager regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. OTHER MATTERS This report is made solely to the unit holders of the Fund and for no other purpose. We do not assume responsibility to any other person for the content of this report. PRICEWATERHOUSECOOPERS (No. AF: 1146) Chartered Accountants Kuala Lumpur 31 July 2017


15

STATEMENT OF COMPREHENSIVE INCOME FOR THE FINANCIAL YEAR ENDED 31 MAY 2017

Note 2017 2016

RM RM

INVESTMENT INCOME/(LOSS)

Dividend income 19,852,218 12,991,358

Profit income 5 2,369,399 2,198,062 Net gain/(loss) on financial assets at fair value through

profit or loss 11 92,360,847 (22,917,855)

Net foreign exchange (loss)/gain (898,563) 2,555,209

Other income 4 122,820 30,599

113,806,721 (5,142,627)

EXPENSES

Management fee 6 16,291,461 10,497,444

Trustee’s and custodian fees 7 836,643 600,576

Audit fee 12,220 11,600

Tax agent’s fee 58,298 49,114

Transaction costs 5,359,405 3,680,416

Donation to charitable bodies 146,541 -

Other expenses 1,458,161 974,925

24,162,729 15,814,075

PROFIT/(LOSS) BEFORE TAXATION 89,643,992 (20,956,702)

Taxation 10 (323,856) (388,552)

PROFIT/(LOSS) AFTER TAXATION AND TOTAL

COMPREHENSIVE INCOME/(LOSS) FOR THE FINANCIAL YEAR 89,320,136 (21,345,254)

Profit/(Loss) after taxation is made up as follows:

Realised amount 20,047,107 (976,974)

Unrealised amount 69,273,029 (20,368,280)

89,320,136 (21,345,254)

The accompanying notes to the financial statements form an integral part of the audited financial statements.


16

STATEMENT OF FINANCIAL POSITION AS AT 31 MAY 2017

2017 2016

Note RM RM

ASSETS

Cash and cash equivalents (Shariah-compliant) 12 121,878,068 110,133,927 Financial assets at fair value through profit or loss

(Shariah-compliant) 11 870,934,121 630,065,822

Amount due from stockbrokers 32,186,472 22,332,433

Amount due from Manager 5,056,783 5,801,323 Amount due from Manager of collective investment

scheme - Management fee rebate 80,085 19,405

Dividends receivable 1,260,132 1,484,007

TOTAL ASSETS 1,031,395,661 769,836,917

LIABILITIES

Amount due to stockbrokers 27,901,347 23,190,864

Amount due to Manager 2,030,882 1,621,473

Accrued management fee 1,571,833 1,130,539

Amount due to Trustee 50,978 36,666

Donation to charitable bodies 146,541 3,262

Other payables and accruals 185,642 160,547

Tax payable 1,760 1,760

TOTAL LIABILITIES 31,888,983 26,145,111

NET ASSET VALUE OF THE FUND 999,506,678 743,691,806

EQUITY

Unit holders’ capital 915,970,907 706,250,189

Retained earnings 83,535,771 37,441,617

NET ASSETS ATTRIBUTABLE TO UNIT HOLDERS 999,506,678 743,691,806

NUMBER OF UNITS IN CIRCULATION (UNITS) 13 843,704,328 655,681,658

NET ASSET VALUE PER UNIT (RM) 1.1846 1.1342



17

STATEMENT OF CHANGES IN EQUITY FOR THE FINANCIAL YEAR ENDED 31 MAY 2017

Unit holders' Retained

Total capital earnings

Note RM RM RM

Balance as at 1 June 2016 706,250,189 37,441,617 743,691,806 Movement in unit holders'

contributions: - Creation of units from

applications 322,079,759 - 322,079,759 - Creation of units from

distribution 42,814,408 - 42,814,408

- Cancellation of units (155,173,449) - (155,173,449) Total comprehensive income for

the financial year - 89,320,136 89,320,136

Distribution 9 - (43,225,982) (43,225,982)

Balance as at 31 May 2017 915,970,907 83,535,771 999,506,678

Balance as at 1 June 2015 214,682,702 84,165,826 298,848,528 Movement in unit holders'

contributions: - Creation of units from

applications 586,129,572 - 586,129,572 - Creation of units from

distribution 24,691,254 - 24,691,254

- Cancellation of units (119,253,339) - (119,253,339) Total comprehensive loss for the

financial year - (21,345,254) (21,345,254)

Distribution 9 - (25,378,955) (25,378,955)

Balance as at 31 May 2016 706,250,189 37,441,617 743,691,806



18

STATEMENT OF CASH FLOWS FOR THE FINANCIAL YEAR ENDED 31 MAY 2017

Note 2017 2016

RM RM

CASH FLOWS FROM OPERATING ACTIVITIES Proceeds from disposal of Shariah-compliant quoted

securities

880,715,198 623,290,065

Purchase of Shariah-compliant quoted securities (1,039,926,805) (1,028,101,260) Purchase of Shariah-compliant collective investment

scheme

- (3,582,249)

Dividend income received 19,737,558 11,685,666 Profit income received from Shariah-compliant

deposits with licensed Islamic financial institutions and Hibah earned

2,369,399 2,198,062

Management fee paid (15,850,167) (9,807,896)

Trustee’s and custodian fees paid (822,331) (578,212)

Donation to charitable bodies (3,262) -

Payments for other fees and expenses (1,503,584) (945,531)

Net realised foreign exchange loss (959,158) (665,776)

Other income 62,140 11,194

Tax (paid)/refund received (1,728) 18,044

Net cash used in operating activities (156,182,740) (406,477,893)

CASH FLOWS FROM FINANCING ACTIVITIES

Cash proceeds from units created 322,824,299 594,172,549

Payments for cancellation of units (154,764,040) (118,554,111)

Distributions paid (411,574) (687,701)

Net cash generated from financing activities 167,648,685 474,930,737

Net increase in cash and cash equivalents 11,465,945 68,452,844

Effects of foreign exchange differences 278,196 3,341,537 Cash and cash equivalents at the beginning of the

financial year

110,133,927 38,339,546

Cash and cash equivalents at the end of the financial year 12 121,878,068 110,133,927

Cash and cash equivalents comprised of: Shariah-compliant deposits with licensed Islamic

financial institutions 99,756,840 99,327,216

Bank balances 22,121,228 10,806,711

Cash and cash equivalents at the end of the financial year 12 121,878,068 110,133,927



19

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 MAY 2017 1. THE FUND, THE MANAGER AND ITS PRINCIPAL ACTIVITY CIMB Islamic DALI Equity Fund (the “Fund”) is governed by a Principal Master Deed dated 15

May 2008, a Fourth Supplemental Master Deed dated 25 June 2008, a Sixth Supplemental Master Deed dated 14 July 2008, a Seventh Supplemental Master Deed dated 19 November 2008, a Fourteenth Supplemental Master Deed dated 26 June 2012 and a Seventeenth Supplemental Master Deed dated 25 March 2015 (collectively referred to as the “Deeds”), made between CIMB-Principal Asset Management Berhad (the “Manager”) and Universal Trustee (Malaysia) Berhad (the “Trustee”).

The Fund is a Shariah-compliant equity growth fund and is a continuation of CIMB Islamic DALI Equity Growth Fund. It may invest a minimum of 70% and up to a maximum of 98% of its Net Asset Value (“NAV”) principally in Shariah-compliant equities aim to provide growth but may also invest in other Shariah-compliant investments, such as Sukuk with a minimum credit rating of “A3” or “P2” by RAM Ratings (“RAM”) or equivalent rating by Malaysian Rating Corporation Berhad (“MARC”) or by local rating agency(ies) of the country; “BBB” by Standard & Poor’s (“S&P”) or equivalent rating by Moody’s or Fitch. The Fund may opt to invest in Shariah-compliant foreign equities up to a maximum of 30% of its NAV. Such foreign equities must be equity securities of companies domiciled in, listed in and/or have significant operations in countries in the Asia Pacific ex Japan. ‘Significant operations’ means major businesses of the company. For example, the Fund can invest in a company with significant business and/or operations in Thailand but listed on the New York Stock Exchange (“NYSE”). The threshold for ‘significant operations’ would be if more than 30% of total group revenue derives from countries in Asia Pacific ex Japan. The calculation would be based on the most recent financial reports released by the companies (e.g. interim and annual reports). In line with its objective, the investment strategy and policy of the Fund is to rebalance the portfolio to suit market conditions in order to reduce short-term volatility and provide consistency in capital growth.

Between 70% to 98% (both inclusive) of the Fund’s NAV will be invested in Shariah-compliant securities and other Shariah-compliant investments, and at least 2% of the Fund’s NAV in Shariah-compliant liquid assets.

All investments are subjected to the SC Guidelines on Unit Trust Funds, SC requirements, the

Deeds, except where exemptions or variations have been approved by the SC, internal policies and procedures and the Fund’s objective.

The Manager, a company incorporated in Malaysia, is a subsidiary of CIMB Group Sdn Bhd

and regards CIMB Group Holdings Berhad as its ultimate holding company. The Manager is also an associate of Principal International (Asia) Limited, which is a subsidiary of Principal Financial Group Inc. The principal activities of the Manager are the establishment and management of unit trust funds and fund management activities.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following accounting policies have been used consistently in dealing with items which are considered material in relation to the financial statements: (a) Basis of preparation

The financial statements have been prepared in accordance with the provisions of the MFRS and IFRS.

The financial statements have been prepared under the historical cost convention, as modified by financial assets at fair value through profit or loss.


20

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(a) Basis of preparation (continued)

The preparation of financial statements in conformity with MFRS and IFRS requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reported year. It also requires the Manager to exercise their judgment in the process of applying the Fund’s accounting policies. Although these estimates and judgment are based on the Manager’s best knowledge of current events and actions, actual results may differ. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 2(m). Standards, amendments to published standards and interpretations to existing standards that are effective: The Fund has applied the following amendments for the first time for the financial year beginning 1 June 2016:

Amendments to MFRS 101 “Presentation of Financial Statements - Disclosure Initiative” provide clarifications on a number of issues, including:

Materiality - an entity should not aggregate or disaggregate information in a manner that obscures useful information. Where items are material, sufficient information must be provided to explain the impact on the financial position or performance.

Disaggregation and subtotals - line items specified in MFRS 101 may need to be disaggregated where this is relevant to an understanding of the entity’s financial position or performance. There is also new guidance on the use of subtotals.

Notes - confirmation that the notes do not need to be presented in a particular order.

Other comprehensive income (“OCI”) arising from investments accounted for under the equity method - the share of OCI arising from equity-accounted investments is grouped based on whether the items will or will not subsequently be reclassified to profit or loss.

Each group should then be presented as a single line item in the statement of other comprehensive income.

According to the transitional provisions, the disclosures in MFRS 108 regarding the adoption of new standards/accounting policies are not required for these amendments.

Annual Improvements to MFRS 2012 - 2014 Cycle

The adoption of these amendments did not have any impact on the current financial year or any prior financial year and is not likely to affect future financial years.


21


(a) Basis of preparation (continued)

The standards, amendments to published standards and interpretations to existing standards that are applicable to the Fund but not yet effective and have not been early adopted are as follows:

(i) Financial year beginning on/after 1 June 2017

Amendments to MFRS 107 ‘‘Statement of Cash Flows - Disclosure Initiative’’ (effective from 1 January 2017) introduce an additional disclosure on changes in liabilities arising from financing activities. The Fund will apply this standard when effective. This standard is not expected to have a significant impact on the Fund’s financial statements.

(ii) Financial year beginning on/after 1 June 2018

MFRS 15 “Revenue from Contracts with Customers” (effective from 1 January 2018) replaces MFRS 118 ‘’Revenue’’ and MFRS 111 ‘‘Construction Contracts’’ and related interpretations. The core principle in MFRS 15 is that an entity recognises revenue to depict the transfer of promised goods or services to the customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

Revenue is recognised when a customer obtains control of goods or services, i.e. when the customer has the ability to direct the use of and obtain the benefits from the goods or services.

A new five-step process is applied before revenue can be recognised: • Identify contracts with customers; • Identify the separate performance obligations; • Determine the transaction price of the contract; • Allocate the transaction price to each of the separate

performance obligations; and • Recognise the revenue as each performance obligation is

satisfied.

Key provisions of the new standard are as follows: • Any bundled goods or services that are distinct must be

separately recognised, and any discounts or rebates on the contract price must generally be allocated to the separate elements.

• If the consideration varies (such as for incentives, rebates, performance fees, royalties, success of an outcome etc), minimum amounts of revenue must be recognised if they are not at significant risk of reversal.

• The point at which revenue is able to be recognised may shift: some revenue which is currently recognised at a point in time at the end of a contract may have to be recognised over the contract term and vice versa.

• There are new specific rules on licenses, warranties, non-refundable upfront fees, and consignment arrangements, to name a few.

• As with any new standard, there are also increased disclosures.


22


(a) Basis of preparation (continued) (ii) Financial year beginning on/after 1 June 2018 (continued)

MFRS 9 “Financial Instruments” (effective from 1 January 2018) will replace MFRS 139 “Financial Instruments: Recognition and Measurement”.

MFRS 9 retains but simplifies the mixed measurement model in MFRS 139 and establishes three primary measurement categories for financial assets: amortised cost, fair value through profit or loss and fair value through OCI. The basis of classification depends on the entity's business model and the contractual cash flow characteristics of the financial asset. Investments in equity instruments1 are always measured at fair value through profit or loss with an irrevocable option at inception to present changes in fair value in OCI (provided the instrument is not held for trading). A debt instrument2 is measured at amortised cost only if the entity is holding it to collect contractual cash flows and the cash flows represent principal and interest3.

For liabilities, the standard retains most of the MFRS 139 requirements. These include amortised cost accounting for most financial liabilities, with bifurcation of embedded derivatives1. The main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair value change due to an entity’s own credit risk is recorded in OCI rather than the income statement, unless this creates an accounting mismatch.

MFRS 9 introduces an expected credit loss model on impairment that replaces the incurred loss impairment model used in MFRS 139. The expected credit loss model is forward-looking and eliminates the need for a trigger event to have occurred before credit losses are recognised.

The Fund will apply these standards when effective. These standards are not expected to have a significant impact on the Fund’s financial statements.

¹ For the purposes of the investments made by the Fund, equity instruments and derivatives refers to Shariah-compliant equity instruments and Shariah-compliant derivatives.

² For the purposes of the investments made by the Fund, debt instruments refers to Sukuk. ³ For the purposes of this Fund, interest refers to profits earned from Shariah-compliant investments.


23


(b) Financial assets and financial liabilities

Classification

The Fund designates its investments in Shariah-compliant collective investment

scheme and Shariah-compliant quoted securities as financial assets at fair value through profit or loss at inception.

Financial assets are designated at fair value through profit or loss when they are

managed and their performance evaluated on a fair value basis. Financing and receivables are non-derivative financial assets with fixed or

determinable payments that are not quoted in an active market and have been included in current assets. The Fund’s financing and receivables comprise cash and cash equivalents, amount due from stockbrokers, amount due from Manager, amount due from Manager of collective investment scheme and dividends receivable.

Financial liabilities are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability.

The Fund classifies amount due to stockbrokers, amount due to Manager, accrued

management fee, amount due to Trustee, donation to charitable bodies, and other payables and accruals as other financial liabilities.

Recognition and measurement Regular purchases and sales of financial assets are recognised on the trade-date, the date on which the Fund commits to purchase or sell the asset. Shariah-compliant investments are initially recognised at fair value. Transaction costs are expensed in the statement of comprehensive income. Financial liabilities, within the scope of MFRS 139, are recognised in the statement of financial position when, and only when, the Fund becomes a party to the contractual provisions of the financial instrument. Financial assets are derecognised when the rights to receive cash flows from the Shariah-compliant investments have expired or have been transferred and the Fund has transferred substantially all risks and rewards of ownership. Financial liabilities are derecognised when it is extinguished, i.e. when the obligation specified in the contract is discharged or cancelled or expired. Unrealised gains or losses arising from changes in the fair value of the financial assets at fair value through profit or loss are presented in the statement of comprehensive income within net gain or loss on financial assets at fair value through profit or loss in the financial year which they arise. Dividend income from financial assets at fair value through profit or loss is recognised in the statement of comprehensive income as part of gross dividend income when the Fund’s right to receive payments is established. Shariah-compliant collective investment scheme is valued based on the most recent published NAV per unit or share of such Shariah-compliant collective investment scheme or, if unavailable, the last published price of such unit or share (excluding any sales charge included in such selling price).


24


(b) Financial assets and financial liabilities (continued)

Recognition and measurement (continued) Shariah-compliant quoted securities in Malaysia are valued at the last done market price quoted on Bursa Malaysia Securities Bhd (“Bursa Securities”) at the date of the statement of financial position. Foreign Shariah-compliant quoted securities are valued at the last traded market price quoted on the respective foreign stock exchanges at the close of the business day of the respective foreign stock exchanges. If a valuation based on the market price does not represent the fair value of the Shariah-compliant quoted securities, for example during abnormal market conditions or when no market price is available, including in the event of a suspension in the quotation of the Shariah-compliant quoted securities for a period exceeding 14 days, or such shorter period as agreed by the Trustee, then the Shariah-compliant quoted securities are valued as determined in good faith by the Manager, based on the methods or bases approved by the Trustee after appropriate technical consultation. Shariah-compliant deposits with licensed Islamic financial institutions are stated at cost plus accrued profit calculated on the effective profit method over the year from the date of placement to the date of maturity of the respective deposits. Financing and receivables and other financial liabilities are subsequently carried at amortised cost using the effective profit method. Impairment for assets carried at amortised costs For assets carried at amortised cost, the Fund assesses at the end of the reporting year whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. The amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective profit rate. The asset’s carrying amount is reduced and the amount of the loss is recognised in statement of comprehensive income. If ‘financing and receivables’ has a variable profit rate, the discount rate for measuring any impairment loss is the current effective profit rate determined under the contract. As a practical expedient, the Fund may measure impairment on the basis of an instrument’s fair value using an observable market price. If, in a subsequent financial year, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss is recognised in statement of comprehensive income. When an asset is uncollectible, it is written off against the related allowance account. Such assets are written off after all the necessary procedures have been completed and the amount of the loss has been determined.


25


(c) Income recognition

Dividend income is recognised on the ex-dividend date when the right to receive payment is established.

Profit income from Shariah-compliant deposits with licensed Islamic financial

institutions is recognised on a time proportionate basis using the effective profit rate method on an accrual basis.

Realised gain or loss on disposal of Shariah-compliant collective investment scheme

and Shariah-compliant quoted securities is accounted for as the difference between the net disposal proceeds and the carrying amount of Shariah-compliant collective investment scheme and Shariah-compliant quoted securities, determined on a weighted average cost basis.

(d) Foreign currency Functional and presentation currency Items included in the financial statements of the Fund are measured using the

currency of the primary economic environment in which the Fund operates (the “functional currency”). The financial statements are presented in Ringgit Malaysia (“RM”), which is the Fund’s functional and presentation currency.

Transactions and balances Foreign currency transactions are translated into the functional currency using the

exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in statement of comprehensive income.

(e) Cash and cash equivalents

For the purpose of statement of cash flows, cash and cash equivalents comprise bank balances and Shariah-compliant deposits held in highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

(f) Taxation Current tax expense is determined according to Malaysian tax laws at the current rate

based upon the taxable profit earned during the financial year. Tax on dividend income from foreign Shariah-compliant quoted securities is based on

the tax regime of the respective countries that the Fund invests in. (g) Distribution A distribution to the Fund’s unit holders is accounted for as a deduction from realised

reserve. A proposed distribution is recognised as a liability in the financial year in which it is approved by the Trustee.


26


(h) Transaction costs Transaction costs are costs incurred to acquire or dispose financial assets or liabilities

at fair value through profit or loss. They include fees and commissions paid to agents, advisors, brokers and dealers. Transaction costs, when incurred, are immediately recognised in the statement of comprehensive income as expenses.

(i) Amount due from/to stockbrokers

Amount due from and amount due to stockbrokers represent receivables for Shariah-compliant quoted securities sold and payables for Shariah-compliant quoted securities purchased that have been contracted for but not yet settled or delivered on the statement of financial position date respectively.

These amounts are recognised initially at fair value and subsequently measured at

amortised cost using the effective profit method, less provision for impairment for amount due from stockbrokers. A provision for impairment of amount due from stockbrokers is established when there is objective evidence that the Fund will not be able to collect all amounts due from the relevant stockbroker. Significant financial difficulties of the stockbroker, probability that the broker will enter bankruptcy or financial reorganisation, and default in payments are considered indicators that the amount due from stockbrokers is impaired. Once a financial asset or a group of similar financial assets has been written down as a result of an impairment loss, profit income is recognised using the rate of profit used to discount the future cash flows for the purpose of measuring the impairment loss.

(j) Management fee rebate

Management fee rebate is derived from the Shariah-compliant collective investment scheme held by the Fund on an accrual basis to ensure no double charging of management fee. It is accrued daily based on the fair value of Shariah-compliant collective investment scheme held.

(k) Unit holders’ capital

The unit holders’ contributions to the Fund meet the criteria to be classified as equity instruments under MFRS 132 “Financial Instruments: Presentation”. Those criteria include:

• the units entitle the holder to a proportionate share of the Fund’s NAV;

• the units are the most subordinated class and class features are identical; • there is no contractual obligations to deliver cash or another financial asset

other than the obligation on the Fund to repurchase; and • the total expected cash flows from the units over its life are based substantially

on the profit or loss of the Fund. The outstanding units are carried at the redemption amount that is payable at each

financial year if unit holder exercises the right to put the unit back to the Fund. Units are created and cancelled at prices based on the Fund’s NAV per unit at the time

of creation or cancellation. The Fund’s NAV per unit is calculated by dividing the net assets attributable to unit holders with the total number of outstanding units.


27


(l) Segment information Operating segments are reported in a manner consistent with the internal reporting

used by the chief operating decision-maker. The chief operating decision-maker is responsible for allocating resources and assessing performance of the operating segments.

(m) Critical accounting estimates and judgments in applying accounting policies

The Fund makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, rarely equal the related actual results. To enhance the information content of the estimates, certain key variables that are anticipated to have material impact to the Fund’s results and financial position are tested for sensitivity to changes in the underlying parameters.

Estimates and judgment are continually evaluated by the Manager and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

In undertaking any of the Fund’s investment, the Manager will ensure that all assets of

the Fund under management will be valued appropriately, that is at fair value and in compliance with the SC Guidelines on Unit Trust Funds.

However, the Manager is of the opinion that there are no accounting policies which

require significant judgment to be exercised.


28

3. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT OBJECTIVES AND POLICIES

Financial instruments of the Fund are as follows:

Financial assets at fair

value through profit or loss

Financing

and receivables

Total

2017 RM RM RM Cash and cash equivalents

(Shariah-compliant) (Note 12) -

121,878,068

121,878,068 Shariah-compliant collective

investment scheme (Note 11) 3,956,638

-

3,956,638 Shariah-compliant quoted securities

(Note 11) 866,977,483

-

866,977,483

Amount due from stockbrokers - 32,186,472 32,186,472

Amount due from Manager - 5,056,783 5,056,783 Amount due from Manager of

collective investment scheme -

80,085

80,085

Dividends receivable - 1,260,132 1,260,132

870,934,121 160,461,540 1,031,395,661

2016 Cash and cash equivalents

(Shariah-compliant) (Note 12) -

110,133,927

110,133,927 Shariah-compliant collective

investment scheme (Note 11) 3,500,793

-

3,500,793 Shariah-compliant quoted securities

(Note 11) 626,565,029

-

626,565,029

Amount due from stockbrokers - 22,332,433 22,332,433

Amount due from Manager - 5,801,323 5,801,323 Amount due from Manager of

collective investment scheme -

19,405

19,405

Dividends receivable - 1,484,007 1,484,007

630,065,822 139,771,095 769,836,917

All current liabilities except tax payable are financial liabilities which are carried at amortised cost. The investment objective of the Fund is to achieve a consistent capital growth over the medium to long-term.

The Fund is exposed to a variety of risks which include market risk (inclusive of price risk, interest rate risk and currency risk), credit risk and liquidity risk.

Financial risk management is carried out through internal control process adopted by the

Manager and adherence to the investment restrictions as stipulated in the Deeds and SC Guidelines on Unit Trust Funds.


29


(CONTINUED)

(a) Market risk

(i) Price risk This is the risk that the fair value of an investment in Shariah-compliant collective investment scheme and Shariah-compliant quoted securities will fluctuate because of changes in market prices (other than those arising from interest rate risk and currency risk). The value of Shariah-compliant collective investment scheme and Shariah-compliant quoted securities may fluctuate according to the activities of individual companies, sector and overall political and economic conditions. Such fluctuation may cause the Fund's NAV and prices of units to fall as well as rise, and income produced by the Fund may also fluctuate. The price risk is managed through diversification and selection of Shariah-compliant collective investment scheme, Shariah-compliant quoted securities and other financial instruments within specified limits according to the Deeds. The Fund’s overall exposure to price risk was as follows:

2017 2016

RM RM Financial assets at fair value through

profit or loss:

- Shariah-compliant collective

investment scheme 3,956,638

3,500,793 - Shariah-compliant quoted securities

- local 587,261,612

440,396,562 - Shariah-compliant quoted securities

- foreign 279,715,871

186,168,467

870,934,121 630,065,822

The table below summarises the sensitivity of the Fund’s profit or loss and NAV to movements in prices of Shariah-compliant collective investment scheme and Shariah-compliant quoted securities at the end of each financial year. The analysis is based on the assumptions that the price of the Shariah-compliant collective investment scheme and Shariah-compliant quoted securities fluctuate by 5% with all other variables held constant. This represents management’s best estimate of a reasonable possible shift in the Shariah-compliant collective investment scheme and Shariah-compliant quoted securities, having regard to the historical volatility of the prices.


30


(CONTINUED)

(a) Market risk (continued)

(i) Price risk (continued)

% Change in prices of Shariah-compliant collective investment scheme and Shariah-compliant

quoted securities

Market value

Impact on

profit or loss/ NAV

RM RM

2017

-5% 827,387,415 (43,546,706)

0% 870,934,121 -

5% 914,480,827 43,546,706

2016

-5% 598,562,531 (31,503,291)

0% 630,065,822 -

5% 661,569,113 31,503,291

(ii) Interest rate risk Fair value interest rate risk is the risk that the value of a financial instrument will

fluctuate due to changes in market interest rates. Interest rate is a general economic indicator that will have an impact on the management of the Fund. It does not in any way suggest that this Fund will invest in conventional financial instruments. All investment carried out for the Fund including placements and deposits are in accordance with Shariah requirements. The Fund’s exposure to fair value interest rate risk arises from investment in money market instruments. The interest rate risk is expected to be minimal as the Fund’s investments comprise mainly short term deposits with approved licensed financial institutions. As at the end of each financial year, the Fund is not exposed to a material level of interest rate risk. The Fund is not exposed to cash flow interest rate risk as the Fund does not hold any financial instruments at variable interest rate.


31


(CONTINUED)

(a) Market risk (continued)

(iii) Currency risk Currency risk is associated with Shariah-compliant investments that are quoted

and/or priced in foreign currency denomination. Foreign currency risk is the risk that the value of financial instruments will fluctuate due to changes in foreign exchange rates. The Manager will evaluate the likely directions of a foreign currency versus RM based on considerations of economic fundamentals such as interest rate differentials, balance of payments position, debt levels, and technical chart considerations.

The following table sets out the foreign currency risk concentrations arising from the denomination of the Fund's financial instruments in foreign currencies:

Financial assets

Cash and cash

equivalents

Financial assets at fair value

through profit or

loss

Amount due from

stockbrokers

Amount due from Manager

of collective

investment scheme

Dividends receivable Total

RM RM RM RM RM RM

2017

AUD 2,664 - - - - 2,664

HKD 5,531 84,960,028 29,292,713 - 554,769 114,813,041

IDR - 15,038,085 - 80,085 - 15,118,170

INR 93,070 42,430,082 - - - 42,523,152

KRW - 52,355,116 - - 33,552 52,388,668

PHP 7 2,267,477 - - - 2,267,484

SGD 97,745 22,128,265 - - - 22,226,010

THB - 3,239,770 - - - 3,239,770

TWD - 15,054,712 - - - 15,054,712

USD 20,899,511 46,198,974 - - - 67,098,485

21,098,528 283,672,509 29,292,713 80,085 588,321 334,732,156

2016

AUD 2,497 - - - - 2,497

HKD 132,173 94,573,096 - - 1,029,589 95,734,858

IDR - 13,598,604 2,189,180 14,854 4,851 15,807,489

INR 86,191 31,074,555 - - - 31,160,746

KRW - 24,032,111 - - - 24,032,111

PHP 7 9,682,834 - - - 9,682,841

SGD 94,690 13,628,158 - - - 13,722,848

TWD 6,871,235 3,079,902 16,900,733 - - 26,851,870

USD 2,996,121 - - - - 2,996,121

10,182,914 189,669,260 19,089,913 14,854 1,034,440 219,991,381


32


(CONTINUED)

(a) Market risk (continued) (iii) Currency risk (continued)

Financial liabilities Amount due to

stockbrokers

RM

2017

HKD 8,299,651

IDR 1,586,370

INR 7,081,670

KRW 1,122,065

SGD 2,571,269

20,661,025

2016

HKD 3,365,696

INR 954,694

PHP 559,373

4,879,763

The table below summarises the sensitivity of the Fund's profit or loss and NAV to changes foreign exchange movements at the end of each reporting year. The analysis is based on the assumption that the foreign exchange rate fluctuates by 5% with all other variables remain constant. This represents management's best estimate of a reasonable possible shift in the foreign exchange rate, having regard to historical volatility of this rate. Disclosures below are shown in absolute terms, changes and impacts could be positive or negative.

Change in foreign

exchange rate Impact on profit or loss/NAV

2017 2016

% RM RM

AUD 5 133 125

HKD 5 5,325,670 4,618,458

IDR 5 676,590 790,374

INR 5 1,772,074 1,510,303

KRW 5 2,563,330 1,201,606

PHP 5 113,374 456,173

SGD 5 982,737 686,142

THB 5 161,989 -

TWD 5 752,736 1,342,594

USD 5 3,354,924 149,806

15,703,557 10,755,581


33


(CONTINUED)

(b) Credit risk

Credit risk refers to the risk that counterparty will default on its contractual obligation resulting in financial loss to the Fund.

The credit risk arising from placements of Shariah-compliant deposits in licensed Islamic financial institutions is managed by ensuring that the Fund will only place Shariah-compliant deposits in reputable licensed Islamic financial institutions. For amount due from Manager, the settlement terms of the proceeds from the creation of units receivable from the Manager are governed by the SC Guidelines on Unit Trust Funds.

For amount due from stockbrokers, the settlement terms are governed by the relevant rules and regulations as prescribed by respective stock exchanges. The credit risk is minimal as all transactions in Shariah-compliance investments are settled/paid upon delivery using approved stockbrokers.

The following table sets out the credit risk concentration of the Fund:

Cash and cash

equivalents

Amount due from

stockbrokers


Amount due from

Manager of collective

investment scheme


RM RM RM RM RM RM

2017

Basic Materials

- Not Rated - - - - 33,552 33,552

Consumer Products

- Not Rated - - - - 249,184 249,184

Finance - CIMB Islamic Bank

Bhd (AAA) 11,555,867 - - - - 11,555,867 - Citibank Bhd

(AAA) 1,015,698 - - - - 1,015,698 - Citibank

Securities Ltd (AAA) 21,098,528 - - - - 21,098,528

- Maybank Islamic Bhd (AAA) 29,341,188 - - - - 29,341,188

- Public Islamic Bank Bhd (AAA) 12,003,937 - - - - 12,003,937

- RHB Islamic Bank Bhd (AA2) 29,643,917 - - - - 29,643,917

- Bank Islam Malaysia Bhd (AA3) 17,218,933 - - - - 17,218,933

- AA3 - 566,197 - - - 566,197

- Not Rated - 31,620,275 - - - 31,620,275

Industrials

- Not Rated - - - - 485,615 485,615


34


(CONTINUED)

(b) Credit risk (continued) The following table sets out the credit risk concentration of the Fund (continued):

Cash and cash

equivalents

Amount due from

stockbrokers


Amount due from


investment scheme


RM RM RM RM RM RM

2017 (continued)

IPC

- Not Rated - - - - 143,374 143,374

Plantation

- Not Rated - - - - 113,502 113,502

Technology

- Not Rated - - - - 106,139 106,139

Trading/Services

- Not Rated - - - - 128,766 128,766

Others

- Not Rated - - 5,056,783 80,085 - 5,136,868

121,878,068 32,186,472 5,056,783 80,085 1,260,132 160,461,540

2016

Consumer Products

- Not Rated - - - - 793,789 793,789

Energy

- Not Rated - - - - 13,880 13,880

Finance - Alliance Bank

Malaysia Bhd (A1) 23,443,220 - - - - 23,443,220

- Bank Islam Malaysia Bhd (AA3) 16,265,824 - - - - 16,265,824

- CIMB Islamic Bank Bhd (AAA) 49,795,212 - - - - 49,795,212

- Citibank Bhd (AAA) 566,783 - - - - 566,783

- Citibank Securities Ltd (AAA) 10,182,914 - - - - 10,182,914

- Maybank Islamic Bhd (AAA) 57,014 - - - - 57,014

- RHB Islamic Bank Bhd (AA2) 9,822,960 - - - 9,822,960

- AAA - 2,904,138 - - - 2,904,138

- A3 - 338,382 - - - 338,382

- Not Rated - 19,089,913 - - 4,851 19,094,764

IPC

- Not Rated - - - - 124,945 124,945


35


(CONTINUED)

(b) Credit risk (continued)

Cash and cash

equivalents

Amount due from

stockbrokers


Amount due from


investment scheme


RM RM RM RM RM RM

2016 (continued)

Industrials

- Not Rated - - - - 258,394 258,394

REITs

- Not Rated - - - - 35,984 35,984

Technology

- Not Rated - - - - 67,896 67,896

Telecommunications

- Not Rated - - - - 184,268 184,268

Others

- Not Rated - - 5,801,323 19,405 - 5,820,728

110,133,927 22,332,433 5,801,323 19,405 1,484,007 139,771,095

All financial assets of the Fund as at the end of each financial year are neither past

due not impaired. (c) Liquidity risk Liquidity risk is the risk that the Fund will encounter difficulty in meeting its financial

obligations.

The Manager manages this risk by maintaining sufficient level of liquid assets to meet anticipated payments and cancellations of the units by unit holders. Liquid assets comprise bank balances and Shariah-compliant deposits with licensed Islamic financial institutions, which are capable of being converted into cash within 7 business days. Generally, all investments are subject to a certain degree of liquidity risk depending on the nature of the investment instruments, market, sector and other factors. For the purpose of the Fund, the Manager will attempt to balance the entire portfolio by investing in a mix of assets with satisfactory trading volume and those that occasionally could encounter poor liquidity. This is expected to reduce the risks for the entire portfolio without limiting the Fund’s growth potentials.


36


(CONTINUED)

(c) Liquidity risk (continued) The table below summarises the Fund’s financial liabilities into relevant maturity groupings based on the remaining period as at the statement of financial position date to the contractual maturity date. The amounts in the table are the contractual undiscounted cash flows.

Less than 1

month

Between 1 month to

1 year Total

RM RM RM

2017

Amount due to stockbrokers 27,901,347 - 27,901,347

Amount due to Manager 2,030,882 - 2,030,882

Accrued management fee 1,571,833 - 1,571,833

Amount due to Trustee 50,978 - 50,978

Donation to charitable bodies - 146,541 146,541

Other payables and accruals # 98,540 83,353 181,893

Contractual undiscounted cash flows 31,653,580 229,894 31,883,474

2016

Amount due to stockbrokers 23,190,864 - 23,190,864

Amount due to Manager 1,621,473 - 1,621,473

Accrued management fee 1,130,539 - 1,130,539

Amount due to Trustee 36,666 - 36,666

Donation to charitable bodies - 3,262 3,262

Other payables and accruals # 69,759 85,205 154,964

Contractual undiscounted cash flows 26,049,301 88,467 26,137,768

# Excludes Goods and Services Tax (“GST”) reverse charge payable amounting to

RM3,749 (2016: RM5,583).

(d) Capital risk management

The capital of the fund is represented by equity consisting of unit holders’ capital and retained earnings. The amount of capital can change significantly on a daily basis as the Fund is subjected to daily subscriptions and redemptions at the discretion of unit holders. The Fund’s objective when managing capital is to safeguard the Fund’s ability to continue as a going concern in order to provide returns to unit holders and benefits for other stakeholders and to maintain a strong capital base to support the development of the investment activities of the Fund.


37


(CONTINUED) (e) Fair value estimation

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (i.e. an exit price). The fair value of financial assets traded in active markets (such as trading securities) are based on quoted market prices at the close of trading on the financial year end date. The Fund utilises the last traded market price for financial assets where the last traded price falls within the bid-ask spread. In circumstances where the last traded price is not within the bid-ask spread, the Manager will determine the point within the bid-ask spread that is most representative of the fair value. An active market is a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of financial assets that are not traded in an active market is determined by using valuation techniques. (i) Fair value hierarchy

The table below analyses financial instruments carried at fair value. The different levels have been defined as follows:

Quoted prices (unadjusted) in active market for identical assets or liabilities (Level 1)

Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2)

Inputs for the asset and liability that are not based on observable market data (that is, unobservable inputs) (Level 3)

The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety is determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. For this purpose, the significance of an input is assessed against the fair value measurement in its entirety. If a fair value measurement uses observable inputs that require significant adjustment based on unobservable inputs, that measurement is a Level 3 measurement. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgment, considering factors specific to the asset or liability. The determination of what constitutes ‘observable’ requires significant judgment by the Fund. The Fund considers observable data to be that market data that is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market.


38


(CONTINUED) (e) Fair value estimation (continued)

(i) Fair value hierarchy (continued)

Level 1 Level 2 Level 3 Total

RM RM RM RM

2017 Financial assets at

fair value through profit or loss:

- Shariah-

compliant collective investment scheme 3,956,638

-

-

3,956,638 - Shariah-

compliant quoted securities - local 587,261,612

-

-

587,261,612 - Shariah-

compliant quoted securities - foreign 279,715,871

-

-

279,715,871

870,934,121 - - 870,934,121

2016 Financial assets at

fair value through profit or loss:

- Shariah-

compliant collective investment scheme 3,500,793

-

-

3,500,793 - Shariah-

compliant quoted securities - local 440,396,562

-

-

440,396,562 - Shariah-

compliant quoted securities - foreign 186,168,467

-

-

186,168,467

630,065,822 - - 630,065,822

Shariah-compliant investments whose values are based on quoted market prices in active markets, and are therefore classified within Level 1, include active listed Shariah-compliant equities and Shariah-compliant collective investment scheme. The Fund does not adjust the quoted prices for these instruments. The Fund’s policies on valuation of these financial assets are stated in Note 2(b).


39


(CONTINUED) (e) Fair value estimation (continued)

(ii) The carrying values of cash and cash equivalents, amount due from stockbrokers, amount due from Manager, amount due from Manager of collective investment scheme, dividends receivable and all current liabilities are a reasonable approximation of their fair values due to their short term nature.

4. OTHER INCOME Other income represents the Fund’s entitlement to management fee rebate from the Manager

of collective investment scheme the Fund invests in. For the six months financial year ended 31 May 2017, the rebate is recognised at a rate of

3.00% per annum (2016: 3.00%) for CIMB-Principal Islamic Equity Growth Syariah, calculated and accrued daily based on the NAV of the Shariah-compliant collective investment schemes.

5. PROFIT INCOME

2017 2016

RM RM

Profit income from Shariah-compliant deposits with licensed

Islamic financial institutions 2,366,120

2,194,665

Hibah 3,279 3,397

2,369,399 2,198,062

6. MANAGEMENT FEE

In accordance with the Deeds, the Manager is entitled to a maximum management fee of

3.00% per annum, calculated daily based on the NAV of the Fund. For the financial year ended 31 May 2017, the management fee is recognised at a rate of

1.85% per annum (2016: 1.85% per annum). There will be no further liability to the Manager in respect of management fee other than

amounts recognised above. 7. TRUSTEE’S AND CUSTODIAN FEES

In accordance with the Deeds, the Trustee is entitled to a fee of 0.06% per annum, calculated daily based on the NAV of the Fund. The foreign custody charges (safekeeping fee and transaction fee, including out of pocket charges) are subject to a minimum of USD500 per month and are charged monthly in arrears. The safekeeping fee ranges from a minimum of 0.04% per annum to a maximum of 0.38% per annum of the market value of the respective foreign portfolio, depending on the country invested. The transaction fee is charged for every transaction and the amount is dependent on the country invested. For the financial year ended 31 May 2017, the Trustee’s fee is recognised at a rate of 0.06% per annum (2016: 0.06% per annum) while the foreign custodian fee is recognised at a rate of 0.04% to 0.38% per annum (2016: 0.04% to 0.38% per annum). There will be no further liability to the Trustee and custodian in respect of Trustee’s and custodian fees other than amounts recognised above.


40

8. DONATION TO CHARITABLE BODIES

This is a provision on donation to charitable bodies derived from net realised gain on the disposal of non Shariah-compliant securities of Sunway Construction Group Bhd, which was excluded from the List of Shariah-Compliant Securities by SACSC as at 27 May 2016. Sunway Construction Group Bhd has been fully disposed on 30 June 2016. The excess capital gains amounting to RM146,541 arising from the disposal of the said security will be channelled to charitable bodies as approved by Shariah Adviser.

9. DISTRIBUTION

Distribution to unit holders is derived from the following sources:

2017 2016

RM RM

Dividend income 19,835,167 12,991,358

Profit income 2,369,399 2,198,062 Net realised gain on disposal of Shariah-compliant

investments 21,592,608

906,841

Other income 122,820 -

Prior financial years’ realised income - 9,374,776

43,919,994 25,471,037

Less:

Expenses (672,534) (91,526)

Taxation (21,478) (556)

Net distribution amount 43,225,982 25,378,955

Distribution on 27 June 2016

Gross/Net distribution per unit (sen) 6.20 -

Distribution on 24 June 2015

Gross/Net distribution per unit (sen) - 7.50

Gross distribution is derived using total income less total expenses. The net distribution is sourced from current and prior financial year’s realised income. Gross distribution per unit is derived from gross realised income less expenses, divided by the number of units in circulation. Net distribution per unit is derived from gross realised income less expenses and taxation, divided by the number of units in circulation.

There are unrealised losses of Nil arising during the financial year (2016: RM20,368,280).

There are no accumulated unrealised losses as at the end of each financial year.


41

10. TAXATION

2017 2016

RM RM

Tax charged for the financial year:

- Current taxation - local 3,558 11,164

- Current taxation - foreign 318,570 339,124

- Underprovision in prior financial years 1,728 38,264

323,856 388,552

A numerical reconciliation between the profit/(loss) before taxation multiplied by the Malaysian statutory income tax rate and tax expense of the Fund is as follows:

2017 2016

RM RM

Profit/(Loss) before taxation 89,643,992 (20,956,702)

Taxation at Malaysian statutory rate of 24%

(2016: 24%) 21,514,558

(5,029,608)

Tax effects of: (Investment income not subject to tax)/Investment loss

not deductible for tax purposes (27,305,073)

1,234,230

Expenses not deductible for tax purposes 1,616,215 1,095,018 Restriction on tax deductible expenses for Unit Trust

Funds 4,182,840

2,700,360

Income tax subject to different tax rate (4,982) 11,164

Effects of foreign tax on foreign taxable income 318,570 339,124

Underprovision in prior financial years 1,728 38,264

Taxation 323,856 388,552

11. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

2017 2016

RM RM Designated at fair value through profit or loss at

inception:

- Shariah-compliant collective investment scheme 3,956,638 3,500,793

- Shariah-compliant quoted securities - local 587,261,612 440,396,562

- Shariah-compliant quoted securities - foreign 279,715,871 186,168,467

870,934,121 630,065,822

Net gain/(loss) on financial assets at fair value through

profit or loss: - Realised gain on disposals 23,330,816 906,841 - Unrealised fair value gain/(loss) 69,030,031 (23,824,696)

92,360,847 (22,917,855)


42

11. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS (CONTINUED)

Name of counter Quantity Aggregate

cost Market

value Percentage

of NAV

Units RM RM %

2017 SHARIAH-COMPLIANT

COLLECTIVE INVESTMENT SCHEME

INDONESIA CIMB-Principal Islamic Equity

Growth Syariah 8,086,248 3,551,288 3,956,638 0.40

TOTAL SHARIAH-COMPLIANT

COLLECTIVE INVESTMENT SCHEME 8,086,248 3,551,288 3,956,638 0.40

ACCUMULATED UNREALISED

GAIN ON SHARIAH-COMPLIANT COLLECTIVE INVESTMENT SCHEME AT FAIR VALUE THROUGH PROFIT OR LOSS 405,350


COLLECTIVE INVESTMENT SCHEME AT FAIR VALUE THROUGH PROFIT OR LOSS 3,956,638

SHARIAH-COMPLIANT

QUOTED SECURITIES - LOCAL

Construction

Ahmad Zaki Resources Bhd 1,334,800 1,423,718 1,374,844 0.14

Econpile Holdings Bhd 5,664,600 10,281,343 13,878,270 1.39

Gabungan AQRS Bhd 805,900 1,050,749 1,160,496 0.12

Gamuda Bhd 5,267,000 25,740,541 28,125,780 2.81

IJM Corp Bhd 3,876,140 13,038,072 13,488,967 1.35

Kerjaya Prospek Group Bhd 4,569,400 12,213,653 14,804,856 1.48

WCT Holdings Bhd 3,089,400 7,202,853 6,858,468 0.69

24,607,240 70,950,929 79,691,681 7.98

Consumer Products

Fraser & Neave Holdings Bhd 91,200 2,199,735 2,217,984 0.22

Nestle Malaysia Bhd 151,700 11,693,366 12,439,400 1.24

242,900 13,893,101 14,657,384 1.46

Finance

BIMB Holdings Bhd 4,600,920 19,888,287 20,796,158 2.08


43



cost Market

value Percentage

of NAV

Units RM RM %

2017 (CONTINUED) SHARIAH-COMPLIANT

QUOTED SECURITIES - LOCAL (CONTINUED)

Industrials

Cahya Mata Sarawak Bhd 705,000 2,963,285 2,890,500 0.29

Kossan Rubber Industries Bhd 826,700 5,527,721 5,059,404 0.51

Petronas Chemicals Group Bhd 4,673,900 32,266,851 34,259,687 3.43

Petronas Gas Bhd 428,900 9,210,692 7,960,384 0.80

SCGM Bhd 751,800 2,607,258 3,195,150 0.32

SKP Resources Bhd 5,201,000 6,709,687 6,605,270 0.66

Success Transformer Corp Bhd 1,235,500 2,726,598 4,694,900 0.47

V.S. Industry Bhd 2,924,500 4,772,980 5,702,775 0.57

16,747,300 66,785,072 70,368,070 7.05

IPC

Digi.com Bhd 3,050,500 15,520,459 15,099,975 1.51 Lingkaran Trans Kota Holdings

Bhd 3,458,400 19,421,965 21,096,240 2.11

Time dotCom Bhd 2,447,830 18,924,956 22,030,470 2.20

8,956,730 53,867,380 58,226,685 5.82

Plantation Felda Global Ventures Holdings

Bhd 6,342,100 11,627,709 11,098,675 1.11

Genting Plantations Bhd 598,500 6,465,735 6,547,590 0.66

IOI Corp Bhd 3,821,200 17,113,332 17,386,460 1.74

Kuala Lumpur Kepong Bhd 778,900 18,571,704 19,285,564 1.93

11,540,700 53,778,480 54,318,289 5.44

Properties

LBS Bina Group Bhd 585,000 1,148,605 1,181,700 0.12

SP Setia Bhd 573,900 1,979,157 2,198,037 0.22 SP Setia Bhd - Preference

Shares 348,720 348,720 404,515 0.04

UOA Development Bhd 2,567,400 5,717,754 6,675,240 0.67

4,075,020 9,194,236 10,459,492 1.05

Trading/Services

Axiata Group Bhd 2,756,323 13,532,686 14,002,121 1.40

Bermaz Auto Bhd 941,100 2,113,950 1,882,200 0.19

Dialog Group Bhd 9,746,524 16,791,558 18,713,326 1.87

E.A. Technique Bhd 3,211,200 2,539,234 1,605,600 0.16

Mega First Corp Bhd 2,638,300 10,115,580 9,920,008 0.99

MISC Bhd 1,898,600 15,293,002 14,239,500 1.42

My Eg Services Bhd 3,660,250 5,448,148 7,759,730 0.78


44



cost Market

value Percentage

of NAV

Units RM RM %



Trading/Services (continued)

Pos Malaysia Bhd 7,835,000 30,816,353 38,626,550 3.86

Sapura Energy Bhd 390,400 643,652 691,008 0.07

Scicom (MSC) Bhd 2,331,900 5,277,504 5,479,965 0.55

Serba Dinamik Holdings Bhd 5,853,000 10,737,495 12,232,770 1.22

Sime Darby Bhd 4,637,700 37,649,064 43,223,364 4.32

Taliworks Corp Bhd 4,883,700 7,374,339 7,520,898 0.75

Telekom Malaysia Bhd 3,155,037 21,154,978 20,444,640 2.05

Tenaga Nasional Bhd 5,067,975 67,215,468 69,836,696 6.99 Tiong Nam Logistics Holdings

Bhd 3,004,600 4,925,528 5,288,096 0.53

UEM Edgenta Bhd 1,560,900 5,211,107 4,386,129 0.44

Yinson Holdings Bhd 855,400 2,912,282 2,891,252 0.29

64,427,909 259,751,928 278,743,853 27.88


QUOTED SECURITIES - LOCAL 135,198,719 548,109,413 587,261,612 58.76

SHARIAH-COMPLIANT

QUOTED SECURITIES - FOREIGN

CAYMAN ISLANDS

Technology

Alibaba Group Holdings Ltd 56,329 23,794,728 29,520,202 2.95

TOTAL CAYMAN ISLANDS 56,329 23,794,728 29,520,202 2.95

CHINA

Basic Materials Anhui Conch Cement Co. Ltd -

H3 514,000 7,951,333 7,295,837 0.73

Energy China Petroleum & Chemical

Corp - H3 1,910,000 5,562,102 6,701,711 0.67 China Shenhua Energy Co. Ltd -

H3 503,000 4,525,403 5,242,225 0.52

2,413,000 10,087,505 11,943,936 1.19


45



cost Market

value Percentage

of NAV

Units RM RM %


QUOTED SECURITIES - FOREIGN (CONTINUED)

CHINA (CONTINUED)

REITs

China Vanke Co Ltd - H2 194,000 2,363,778 2,205,076 0.22

TOTAL CHINA 3,121,000 20,402,616 21,444,849 2.14

HONG KONG

Consumer Products

Brilliance China Automotive 1,090,000 7,983,945 8,702,466 0.87

Techtronic Industries Co. Ltd 361,500 6,297,818 7,314,712 0.73

1,451,500 14,281,763 16,017,178 1.60

Energy

CNOOC Ltd 658,000 3,314,869 3,215,639 0.32

Industrials

MTR Corp Ltd 254,000 4,935,844 6,192,530 0.62

REITs

China Resources Land Ltd 398,000 4,625,883 5,004,607 0.50 Henderson Land Development

Co. Ltd 264,050 6,802,195 7,300,239 0.73

Link REIT 200,930 5,366,327 6,785,336 0.68

862,980 16,794,405 19,090,182 1.91

Technology

AAC Technologies Holdings Inc. 114,500 4,726,513 5,193,223 0.52 Sunny Optical Technology

Group Co Ltd 177,000 5,727,703 5,899,475 0.59

291,500 10,454,216 11,092,698 1.11

Telecommunications

China Unicom (Hong Kong) Ltd 1,288,000 6,719,186 7,906,952 0.79

TOTAL HONG KONG 4,805,980 56,500,283 63,515,179 6.35


46



cost Market

value Percentage

of NAV

Units RM RM %



INDIA

Basic Materials

UltraTech Cement Ltd 13,000 3,612,180 3,615,843 0.36

Consumer Products

Maruti Suzuki India Ltd 24,506 6,690,915 11,716,056 1.17

Tata Motors Ltd 90,287 3,097,132 2,850,247 0.29

114,793 9,788,047 14,566,303 1.46

Energy

Reliance Industries Ltd 189,024 15,602,800 16,802,043 1.68

Telecommunications

Bharti Infratel Ltd 306,345 7,039,195 7,445,893 0.74

TOTAL INDIA 623,162 36,042,222 42,430,082 4.24

INDONESIA

Telecommunications PT. Telekomunikasi Indonesia

Persero Tbk 7,928,600 9,497,555 11,081,447 1.11

TOTAL INDONESIA 7,928,600 9,497,555 11,081,447 1.11

PHILIPPINES

Finance

Metro Pacific Investments Corp 4,210,000 2,240,024 2,267,477 0.23

TOTAL PHILIPPINES 4,210,000 2,240,024 2,267,477 0.23

SINGAPORE

Industrials

ComfortDelGro Corp. Ltd 1,040,700 8,287,365 7,720,828 0.77

REITs

CapitaLand Mall Trust 1,323,300 8,121,137 8,140,264 0.81


47



cost Market

value Percentage

of NAV

Units RM RM %



SINGAPORE (CONTINUED)

Technology

Venture Corp Ltd 156,800 5,568,307 6,267,173 0.63

TOTAL SINGAPORE 2,520,800 21,976,809 22,128,265 2.21

SOUTH KOREA

Basic Materials

Posco 14,970 16,270,567 16,136,837 1.61

Consumer Products

Amorepacific Corp 5,059 6,177,675 6,632,944 0.66

Hankook Tire Co Ltd 24,574 5,518,564 5,720,588 0.57

29,633 11,696,239 12,353,532 1.23

Energy

SK Innovation Co. Ltd 4,406 2,532,217 2,846,287 0.28

Technology

LG Innotek Co. Ltd 10,431 5,515,499 5,342,915 0.53 Samsung Electro-Mechanics Co

Ltd 19,362 6,101,317 6,105,928 0.61

SK Hynix Inc 43,921 7,328,301 9,569,617 0.96

73,714 18,945,117 21,018,460 2.10

TOTAL SOUTH KOREA 122,723 49,444,140 52,355,116 5.22

TAIWAN

Basic Materials

Formosa Plastics Corp 428,000 5,478,836 5,451,607 0.55

Consumer Products

Merida Industry Co Ltd 251,000 5,324,354 5,791,825 0.58

Technology

Advantech Co. Ltd 110,000 3,904,534 3,811,280 0.39

TOTAL TAIWAN 789,000 14,707,724 15,054,712 1.52


48



cost Market

value Percentage

of NAV

Units RM RM %



THAILAND

Energy

PTT PCL - NVDR1 65,600 2,675,097 3,239,770 0.33

TOTAL THAILAND 65,600 2,675,097 3,239,770 0.33

UNITED STATES

Consumer Products

CTRIP.COM - ADR2 71,315 15,898,726 16,678,772 1.68

TOTAL UNITED STATES 71,315 15,898,726 16,678,772 1.68


QUOTED SECURITIES - FOREIGN 24,314,509 253,179,924 279,715,871 27.98


QUOTED SECURITIES 159,513,228 801,289,337 866,977,483 86.74


GAIN ON SHARIAH-COMPLIANT QUOTED SECURITIES AT FAIR VALUE THROUGH PROFIT OR LOSS 65,688,146


QUOTED SECURITIES AT FAIR VALUE THROUGH PROFIT OR LOSS 866,977,483


49

11. INANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS (CONTINUED)


cost Market

value Percentage

of NAV

Units RM RM %

2016 SHARIAH-COMPLIANT

COLLECTIVE INVESTMENT SCHEME

INDONESIA CIMB-Principal Islamic Equity

Growth Syariah 8,086,248 3,551,288 3,500,793 0.47


COLLECTIVE INVESTMENT SCHEME 8,086,248 3,551,288 3,500,793 0.47


LOSS ON SHARIAH-COMPLIANT COLLECTIVE INVESTMENT SCHEME AT FAIR VALUE THROUGH PROFIT OR LOSS (50,495)


COLLECTIVE INVESTMENT SCHEME AT FAIR VALUE THROUGH PROFIT OR LOSS 3,500,793

SHARIAH-COMPLIANT

QUOTED SECURITIES - LOCAL

Construction

Gadang Holdings Bhd 1,062,200 2,245,875 2,209,376 0.30

Gamuda Bhd 2,964,400 14,270,774 14,229,120 1.91

IJM Corp Bhd 2,254,540 7,608,931 7,868,345 1.06

Mitrajaya Holdings Bhd 1,432,800 1,790,717 1,876,968 0.25

Muhibbah Engineering (M) Bhd 1,036,500 2,476,098 2,269,935 0.31

Protasco Bhd 4,997,100 8,350,839 8,295,186 1.12

Sunway Construction Group Bhd 2,294,500 3,518,449 3,625,310 0.49

16,042,040 40,261,683 40,374,240 5.44

Consumer Products

Fraser & Neave Holdings Bhd 308,500 7,248,578 7,311,450 0.98

MSM Malaysia Holdings Bhd 648,900 3,467,785 3,244,500 0.44

Nestle Malaysia Bhd 106,000 8,017,440 8,056,000 1.08 YSP Southeast Asia Holdings

Bhd 1,168,100 3,504,740 2,698,311 0.36

2,231,500 22,238,543 21,310,261 2.86


50



cost Market

value Percentage

of NAV

Units RM RM %



Finance

BIMB Holdings Bhd 1,103,320 4,276,195 4,424,313 0.59

Syarikat Takaful Malaysia Bhd 764,100 2,960,857 2,987,631 0.40

1,867,420 7,237,052 7,411,944 0.99

Industrials

Cahya Mata Sarawak Bhd 3,435,300 16,710,578 12,332,727 1.66

Hume Industries Bhd 388,800 1,453,100 1,251,936 0.17

KNM Group Bhd 1,496,800 748,400 688,528 0.09

Kossan Rubber Industries Bhd 222,800 1,750,660 1,515,040 0.20

Petronas Chemicals Group Bhd 3,687,000 24,731,735 24,260,460 3.26

Petronas Gas Bhd 1,412,800 30,263,293 30,572,992 4.11

SKP Resources Bhd 2,754,600 3,650,948 3,553,434 0.48

Top Glove Corporation Bhd 498,300 2,847,074 2,526,381 0.34

V.S. Industry Bhd 1,171,900 1,454,445 1,417,999 0.19

15,068,300 83,610,233 78,119,497 10.50

IPC

Digi.com Bhd 2,646,000 13,997,730 11,854,080 1.59 Lingkaran Trans Kota Holdings

Bhd 1,109,500 5,768,959 5,935,825 0.80

Time dotCom Bhd 2,665,730 19,518,939 19,646,430 2.64

6,421,230 39,285,628 37,436,335 5.03

Plantation

Genting Plantations Bhd 469,300 5,136,347 4,880,720 0.66

IOI Corp Bhd 2,340,100 10,873,625 9,688,014 1.30

Kuala Lumpur Kepong Bhd 191,700 4,415,762 4,416,768 0.59

3,001,100 20,425,734 18,985,502 2.55

Properties

Tambun Indah Land Bhd 768,200 1,252,826 1,037,070 0.14

UOA Development Bhd 3,262,800 7,187,594 7,406,556 1.00

4,031,000 8,440,420 8,443,626 1.14

REITs

Axis REIT 627,200 1,106,162 1,066,240 0.14

KLCCP REIT 604,100 4,352,845 4,440,135 0.60

1,231,300 5,459,007 5,506,375 0.74


51



cost Market

value Percentage

of NAV

Units RM RM %



Technology

Globetronics Technology Bhd 445,900 2,587,601 1,600,781 0.22

Inari Amertron Bhd 4,393,600 15,074,470 13,620,160 1.83

Malaysian Pacific Industries Bhd 806,400 6,212,657 5,951,232 0.80

Unisem (M) Bhd 1,033,600 2,403,270 2,480,640 0.33

6,679,500 26,277,998 23,652,813 3.18

Trading/Services

Axiata Group Bhd 2,740,789 16,647,748 14,306,919 1.92

Bermaz Auto Bhd 3,798,300 8,362,320 9,077,937 1.22

Datasonic Group Bhd 597,200 790,454 794,276 0.11

Dialog Group Bhd 2,426,924 3,903,655 3,761,732 0.51

IHH Healthcare Bhd 2,235,000 14,766,121 14,438,100 1.94

Malakoff Corp Bhd 9,047,900 13,783,484 14,567,119 1.96

MISC Bhd 2,697,800 22,349,161 20,827,016 2.80

My Eg Services Bhd 2,690,000 5,589,622 5,595,200 0.75

Pharmaniaga Bhd 456,000 3,097,969 2,567,280 0.35

Pos Malaysia Bhd 296,200 1,416,127 725,690 0.10

Scicom (MSC) Bhd 2,553,700 5,748,476 5,975,658 0.80

Sime Darby Bhd 2,725,300 20,789,280 20,194,473 2.72

Taliworks Corporation Bhd 4,058,500 6,027,209 5,803,655 0.78 Taliworks Corporation Bhd -

Warrant 293,000 - 73,250 0.01

Telekom Malaysia Bhd 1,089,937 7,332,216 7,335,276 0.99

Tenaga Nasional Bhd 4,548,775 56,806,830 63,591,875 8.55 Tiong Nam Logistics Holdings

Bhd 2,490,600 3,207,060 3,138,156 0.42

UEM Edgenta Bhd 912,900 3,144,118 3,405,117 0.46

Westports Holdings Bhd 686,000 2,945,334 2,977,240 0.39

46,344,825 196,707,184 199,155,969 26.78


QUOTED SECURITIES - LOCAL 102,918,215 449,943,482 440,396,562 59.21


52



cost Market

value Percentage

of NAV

Units RM RM %


QUOTED SECURITIES - FOREIGN

CHINA

Energy China Petroleum & Chemical

Corp - H3 1,308,000 3,670,137 3,683,184 0.50

PetroChina Co. Ltd - H3 984,000 3,182,217 2,791,748 0.38

2,292,000 6,852,354 6,474,932 0.88

Industrials

Sinotrans Limited - H3 1,516,000 3,155,748 2,698,260 0.36

Telecommunications

China Telecom Corp Ltd - H3 3,430,000 7,281,454 6,596,940 0.89

TOTAL CHINA 7,238,000 17,289,556 15,770,132 2.13

HONG KONG

Consumer Products

MTR Corp Ltd 413,500 7,558,957 8,095,670 1.09

Techtronic Industries Co. Ltd 654,500 9,232,548 10,866,745 1.46

1,068,000 16,791,505 18,962,415 2.55

Energy

CNOOC Ltd 1,621,000 7,911,320 7,992,282 1.07

Finance China Overseas Land and

Investment Ltd 394,000 5,276,199 4,887,907 0.66

China Resources Land Ltd 376,000 3,993,834 3,711,704 0.50 Henderson Land Development

Co. Ltd 85,500 2,191,512 2,141,843 0.29

855,500 11,461,545 10,741,454 1.45

Industrials China Merchants Holdings

International Co. Ltd 160,000 2,272,274 1,887,178 0.25

REITs

Link REIT 271,930 6,449,804 6,898,749 0.93

Technology

Tencent Holdings Ltd 271,900 21,509,113 25,034,999 3.37


53



cost Market

value Percentage

of NAV

Units RM RM %



HONG KONG (CONTINUED)

Telecommunications

China Unicom (Hong Kong) Ltd 638,000 3,061,492 2,843,953 0.38

Utilities Cheung Kong Infrastructure

Holdings Ltd 115,000 4,222,835 4,441,934 0.60

TOTAL HONG KONG 5,001,330 73,679,888 78,802,964 10.60

INDIA

Consumer Products

Dabur India Ltd 439,449 7,191,902 7,816,734 1.05

Maruti Suzuki India Ltd 13,859 3,281,767 3,541,283 0.48

453,308 10,473,669 11,358,017 1.53

Energy

Reliance Industries Ltd 133,497 7,918,113 7,851,224 1.06

Health Care

Apollo Hospitals Enterprise Ltd 46,372 4,066,684 3,898,157 0.52

Dr Reddy's Laboratories Ltd 8,144 1,815,398 1,591,682 0.21

54,516 5,882,082 5,489,839 0.73

Industrials

UltraTech Cement Ltd 22,049 3,882,774 4,368,334 0.59

Telecommunications

Bharti Infratel Ltd 87,277 2,257,746 2,007,141 0.27

TOTAL INDIA 750,647 30,414,384 31,074,555 4.18

INDONESIA

Telecommunications PT. Telekomunikasi Indonesia

Persero Tbk 9,030,900 7,712,970 10,097,811 1.36

TOTAL INDONESIA 9,030,900 7,712,970 10,097,811 1.36


54



cost Market

value Percentage

of NAV

Units RM RM %



PHILIPPINES

Consumer Products

Jollibee Foods Corp Ltd 104,020 1,962,883 2,159,692 0.29

Universal Robina Corp Ltd 290,440 5,076,819 4,995,278 0.67

394,460 7,039,702 7,154,970 0.96

Utilities

Metro Pacific Investments Corp 4,753,000 2,295,788 2,527,864 0.34

TOTAL PHILIPPINES 5,147,460 9,335,490 9,682,834 1.30

SINGAPORE

Consumer Products

ComfortDelGro Corp. Ltd 662,900 5,418,513 5,432,328 0.73

Telecommunications Singapore Telecommunications

Ltd 708,100 8,131,729 8,195,830 1.10

TOTAL SINGAPORE 1,371,000 13,550,242 13,628,158 1.83

SOUTH KOREA

Basic Materials

LG Chemical Ltd 9,287 9,536,398 8,711,572 1.17

Consumer Products

Amorepacific Corp 6,691 8,134,978 9,669,395 1.30 LG Household & Health Care

Ltd 945 3,260,515 3,454,200 0.46

7,636 11,395,493 13,123,595 1.76

Telecommunications

SK Telecom Co. Ltd 2,859 2,514,106 2,196,944 0.30

TOTAL SOUTH KOREA 19,782 23,445,997 24,032,111 3.23


55



cost Market

value Percentage

of NAV

Units RM RM %



TAIWAN

Consumer Products

Eclat Textile Co. Ltd 69,563 4,079,060 3,079,902 0.41

TOTAL TAIWAN 69,563 4,079,060 3,079,902 0.41


QUOTED SECURITIES - FOREIGN 28,628,682 179,507,587 186,168,467 25.04


QUOTED SECURITIES 131,546,897 629,451,069 626,565,029 84.25


LOSS ON SHARIAH-COMPLIANT QUOTED SECURITIES AT FAIR VALUE THROUGH PROFIT OR LOSS (2,886,040)


QUOTED SECURITIES AT FAIR VALUE THROUGH PROFIT OR LOSS 626,565,029

1 NVDR, or non-voting depository receipt, is a trading instrument issued by Thai NVDR

Company Limited, a subsidiary wholly owned by the Stock Exchange of Thailand (“SET”). It is a valid security as specified by the United States Securities and Exchange Commission (“SEC”) and is automatically regarded as a listed security by the SET. The underlying security is a listed security in the SET.

2 ADR, or American depositary receipt, is a negotiable certificate issued by a U.S. bank representing a specified number of shares (or one share) in a foreign stock that is traded on a U.S. exchange. ADRs are denominated in U.S. dollars, with the underlying security held by a U.S. financial institution overseas. ADRs help to reduce administration and duty costs that would otherwise be levied on each transaction.

3 H shares refer to the shares of companies incorporated in the Chinese mainland that are listed on the Hong Kong Stock Exchange or other foreign exchange. H shares are still regulated by Chinese law, but they are denominated in Hong Kong dollars and trade the same as other equities on the Hong Kong exchange.


56

12. CASH AND CASH EQUIVALENTS (SHARIAH-COMPLIANT)

2017 2016

RM RM

Shariah-compliant deposits with licensed Islamic

financial institutions 99,756,840 99,327,216

Bank balances 22,121,228 10,806,711

121,878,068 110,133,927

The weighted average effective profit rate per annum is as follows:

2017 2016

% %

Shariah-compliant deposits with licensed Islamic

financial institutions 3.24 3.42

Shariah-compliant deposits with licensed Islamic financial institutions of the Fund have an average maturity of 10 days (2016: 6 days).

13. NUMBER OF UNITS IN CIRCULATION (UNITS)

2017 2016

No. of units No. of units

At the beginning of the financial year 655,681,658 239,122,799

Add: Creation of units from applications 284,722,462 498,879,023

Add: Creation of units from distribution 40,280,749 20,997,750

Less: Cancellation of units (136,980,541) (103,317,914)

At the end of the financial year 843,704,328 655,681,658

14. MANAGEMENT EXPENSE RATIO (“MER”)

2017 2016

% %

MER 2.07 2.10

MER is derived from the following calculation: MER = (A + B + C + D + E) x 100 F

A = Management fee (including management fee rebates) B = Trustee’s and custodian fees C = Audit fee D = Tax agent’s fee E = Other expenses excluding GST on transaction costs F = Average NAV of the Fund calculated on a daily basis

The average NAV of the Fund for the financial year calculated on a daily basis is

RM882,159,357 (2016: RM568,162,526).


57

15. PORTFOLIO TURNOVER RATIO (“PTR”)

2017 2016

PTR (times) 1.10 1.47

PTR is derived based on the following calculation:

(Total acquisition for the financial year + total disposal for the financial year) 2 Average NAV of the Fund for the financial year calculated on a daily basis

where: total acquisition for the financial year = RM1,041,284,107 (2016: RM1,035,219,607) total disposal for the financial year = RM892,776,655 (2016: RM631,125,162)

16. UNITS HELD BY THE MANAGER AND PARTIES RELATED TO THE MANAGER, AND

SIGNIFICANT RELATED PARTY TRANSACTIONS AND BALANCES

The related parties and their relationship with the Fund are as follows: Related parties Relationship CIMB-Principal Asset Management Bhd The Manager CIMB-Group Sdn Bhd Holding company of the Manager CIMB Group Holdings Bhd (“CIMB”) Ultimate holding company of the Manager CIMB Investment Bank Bhd Fellow related party to Manager CIMB Islamic Bank Bhd Fellow related party to Manager CIMB Securities (S) Pte Ltd Fellow related party to Manager CIMB Securities (India) Pte Ltd Fellow related party to Manager CIMB Securities Limited (Taiwan) Fellow related party to Manager CIMB Securities Limited (South Korea) Fellow related party to Manager Subsidiaries and associates of CIMB as

disclosed in its financial statements Subsidiary and associated companies of the

ultimate holding company of the Manager Units held by the Manager and parties related to the Manager 2017 2016

Manager No. of units RM No. of units RM CIMB-Principal Asset Management Bhd 404,313 478,949 188,602 213,912

In the opinion of the Manager, the above units were transacted at the prevailing market price.

The units are held beneficially by the Manager for booking purposes. Other than the above, there were no units held by the Directors or parties related to the Manager.


58

16. UNITS HELD BY THE MANAGER AND PARTIES RELATED TO THE MANAGER, AND

SIGNIFICANT RELATED PARTY TRANSACTIONS AND BALANCES (CONTINUED)

In addition to related party disclosures mentioned elsewhere in the financial statements, set out below are other significant related party transactions and balances. The Manager is of the opinion that all transactions with the related companies have been entered into in the normal course of business at agreed terms between the related parties.

2017 2016 RM RM Significant related party transaction Profit income from Shariah-compliant deposits with

licensed Islamic financial institutions:

- CIMB Islamic Bank Bhd 492,778 715,249

Significant related party balance Shariah-compliant deposits with licensed Islamic

financial institutions:

- CIMB Islamic Bank Bhd 11,555,867 49,795,212

17. TRANSACTIONS WITH BROKERS/DEALERS/FINANCIAL INSTITUTIONS Details of transactions with the top 10 brokers/dealers for the financial year ended 31 May 2017 are as follows:

Brokers/Dealers Value of

trades

Percentage of total trades

Brokerage fees

Percentage of total

brokerage fees

RM % RM %

Maybank Securities Ltd 233,082,770 12.05 482,274 11.69 CLSA Securities

Malaysia Sdn Bhd 153,443,601 7.93 329,368 7.98 Credit Suisse Securities

(Malaysia) Sdn Bhd 150,256,134 7.77 321,946 7.80 Macquarie (Malaysia)

Sdn Bhd 148,940,822 7.70 315,860 7.65 J.P Morgan Securities

(Malaysia) Sdn Bhd 139,443,934 7.21 296,822 7.19 J.P Morgan Securities

Singapore Pte Ltd 110,261,545 5.70 181,717 4.40 RHB Investment Bank

Bhd 97,071,100 5.02 240,030 5.82 CIMB Investment Bank

Bhd # 89,776,753 4.64 186,197 4.51

CLSA Hong Kong Ltd 88,121,003 4.56 249,457 6.04 Hong Leong Investment

Bank 83,446,861 4.31 179,495 4.35

Others # 640,216,238 33.11 1,343,750 32.57

1,934,060,761 100.00 4,126,916 100.00


59

17. TRANSACTIONS WITH BROKERS/DEALERS/FINANCIAL INSTITUTIONS (CONTINUED)

Details of transactions, primarily cash placements with the licensed Islamic financial institutions for the financial year ended 31 May 2017 are as follows:

Financial Institutions Value of placements Percentage of total

placements

RM %

Bank Islam Malaysia Bhd 942,840,000 43.02

CIMB Islamic Bank Bhd # 517,236,000 23.60

Public Islamic Bank Bhd 263,549,000 12.02

Maybank Islamic Bhd 237,239,000 10.82

RHB Islamic Bank Bhd 143,462,000 6.55

Hong Leong Islamic Bank Bhd 83,805,000 3.82

Alliance Islamic Bank Malaysia Bhd 3,710,000 0.17

2,191,841,000 100.00

Details of transactions with the top 10 brokers/dealers for the financial year ended 31 May 2016 are as follows:

Brokers/Dealers Value of

trades

Percentage of total trades

Brokerage fees

Percentage of total

brokerage fees

RM % RM % CIMB Investment Bank

Bhd # 244,454,733 14.38 482,535 17.65

CLSA Hong Kong Ltd 209,580,945 12.33 187,853 6.87

Maybank Securities Ltd 160,794,343 9.46 245,129 8.96 Kenanga Investment

Bank Bhd 143,438,973 8.44 234,938 8.59 Hong Leong Investment

Bank 140,533,375 8.26 239,221 8.75 RHB Investment Bank

Bhd 88,178,484 5.19 185,541 6.79 Alliance Investment Bank

Bhd 60,014,719 3.53 129,122 4.72 Macquarie (Malaysia)

Sdn Bhd 59,257,634 3.49 113,161 4.14 CIMB Securities

(Singapore) Pte Ltd 56,463,065 3.32 29,980 1.10 JPMorgan Securities

(Malaysia) Sdn Bhd 52,042,892 3.05 109,205 3.99

Others # 485,592,446 28.55 777,611 28.44

1,700,351,609 100.00 2,734,296 100.00


60

17. TRANSACTIONS WITH BROKERS/DEALERS/FINANCIAL INSTITUTIONS (CONTINUED)

Details of transactions, primarily cash placements with the licensed Islamic financial institutions for the financial year ended 31 May 2016 are as follows:

Financial Institutions Value of placements Percentage of total

placements

RM %

CIMB Islamic Bank Bhd # 1,237,759,000 30.38

Bank Islam Malaysia Bhd 1,101,095,000 27.03

Maybank Islamic Bhd 583,831,000 14.33

Hong Leong Islamic Bank Bhd 438,177,000 10.75

Public Islamic Bank Bhd 334,074,000 8.20

Alliance Islamic Bank Malaysia Bhd 178,605,000 4.38

RHB Islamic Bank Bhd 122,748,000 3.01

Bank Muamalat Malaysia Bhd 70,923,000 1.74

AmBank Islamic Bhd 7,000,000 0.18

4,074,212,000 100.00

# Included in the transactions are trades conducted with CIMB Islamic Bank Bhd, CIMB

Investment Bank Bhd, CIMB Securities (S) Pte Ltd, CIMB Securities Ltd (Taiwan), CIMB Securities Ltd (South Korea), and CIMB Securities (India) Pte Ltd, fellow related parties to the Manager amounting to RM517,236,000 (2016: RM1,237,759,000), RM89,776,753 (2016: RM244,454,733), RM15,391,477 (2016: RM56,463,065), Nil (2016: RM22,498,392), RM1,824,675 (2016: RM8,061,335), and RM1,026,524 (2016: RM8,782,921) respectively. The Manager is of the opinion that all transactions with the related company have been entered into in the normal course of business at agreed terms between the related parties.

18. SEGMENT INFORMATION

The internal reporting provided to the chief operating decision-maker for the Fund’s assets, liabilities and performance is prepared on a consistent basis with the measurement and recognition principles of MFRS and IFRS. The chief operating decision-maker is responsible for the performance of the Fund and considers the business to have a single operating segment located in Malaysia. Asset allocation decisions are based on a single, integrated investment strategy and the Fund’s performance is evaluated on an overall basis. The investment objective of the Fund is to achieve a consistent capital growth over the medium to long-term. The reportable operating segment derives its income by seeking investments to achieve targeted returns consummate with an acceptable level of risk within the portfolio. These returns consist of profit income and dividend income earned from Shariah-compliant investments and gains on the appreciation in the value of Shariah-compliant investments, which are derived from Ringgit-denominated Shariah-compliant deposits with licensed Islamic financial institutions in Malaysia, Shariah-compliant quoted securities listed on the Bursa Securities, Malaysia, Shariah-compliant collective investment scheme and Shariah-compliant quoted securities of companies domiciled in, listed in and/or have significant operations in countries in the Asia Pacific ex Japan. There were no changes in reportable operating segment during the financial year.

19. APPROVAL OF FINANCIAL STATEMENTS

The financial statements have been approved for issue by the Manager on 31 July 2017.


61

DIRECTORY Head office of the Manager CIMB-Principal Asset Management Berhad (Company No.: 304078-K) 10th Floor, Bangunan CIMB, Jalan Semantan, Damansara Heights, 50490 Kuala Lumpur, MALAYSIA. Tel: (03) 2084 8888 Postal address CIMB-Principal Asset Management Berhad (Company No.: 304078-K) P.O.Box 10571, 50718 Kuala Lumpur, MALAYSIA. Website www.cimb-principal.com.my E-mail address [email protected] General investment enquiries (03) 7718 3100 Trustee for the CIMB Islamic Dali Equity Fund Universal Trustee (Malaysia) Berhad (Company No.:17540-D) No. 1 Jalan Ampang 3rd Floor, 50450 Kuala Lumpur, MALAYSIA. Tel: (03) 2070 8050 Fax: (03) 2031 8715, (03) 2032 3194, (03) 2070 1296 Shariah Adviser of the CIMB Islamic Dali Equity Fund CIMB Islamic Bank Berhad (Company No.: 671380-H) Level 34, Menara Bumiputra-Commerce, No 11, Jalan Raja Laut, 50350 Kuala Lumpur, MALAYSIA. Tel: (03) 2619 1188 Fax: (03) 2691 3513, (03) 2691 3657 Auditors of the Fund and of the Manager PricewaterhouseCoopers (Company No. AF: 1146) Level 10, 1 Sentral, Jalan Rakyat, Kuala Lumpur Sentral, PO Box 10192, 50706 Kuala Lumpur, MALAYSIA. Tel: (03) 2173 1188 Fax: (03) 2173 1288

http://www.cimb-principal.com.my/

mailto:[email protected]


62

LIST OF CWA (an Agency force of CIMB-Principal) OFFICES ADDRESS TELEPHONE REGIONAL OFFICE

Northern Region 5, Jalan Todak 4, Bandar Sunway, Seberang Jaya, 13700 Perai, Pulau Pinang.

04-370 2155 04-370 2156

Southern Region 23 & 23A, Jalan Harimau Tarum, Taman Century, 80250 Johor Bahru, Johor.

07-334 1748

Central Region 46, 2nd Floor, Jalan SS 21/39, Damansara Utama, 47400 Petaling Jaya, Selangor.

03-7712 2888

Sarawak 5B, Lot 414, Section 10, KTLD Jalan Rubber, 93400 Kuching, Sarawak.

082-259 777

Sabah 1, Jalan Pasar Baru, Kampung Air, 88000 Kota Kinabalu, Sabah.

088-239 951 088-239 952

BRANCHES

Ipoh 30A, 1st Floor, Persiaran Greentown 1, Greentown Business Centre, 30450 Ipoh, Perak.

05-243 9001 05-243 9002

Kota Bharu Ground Floor, 298-B, Jalan Tok Hakim, 15000 Kota Bharu, Kelantan.

09-747 1172 09-747 1190

Ampang 13B, 2nd Floor, Jalan Mamanda 7/1, Off Jalan Ampang, 68000 Ampang, Selangor.

03-4270 2970

Sri Petaling 169-2, Jalan Radin Bagus, Bandar Baru Sri Petaling, 57000 Kuala Lumpur.

03-9059 2333

Melaka 21, Jalan Melaka Raya 24, Taman Melaka Raya, 75000 Melaka.

06-281 1111

Miri 1st & 2nd Floor, Lot 1092, Jalan Merpati, 98000 Miri, Sarawak.

085-432 525

Kuantan 44 & 44A, Jalan Putra Square 6, Putra Square, 25000 Kuantan, Pahang.

09-513 4400

FINANCIAL CARE CENTER (FCC)

Financial Planning Centre

46, 2nd Floor, Jalan SS 21/39, Damansara Utama, 47400 Petaling Jaya, Selangor.

03-7718 3000


63

LIST OF CWA (an Agency force of CIMB-Principal) OFFICES (CONTINUED) ADDRESS TELEPHONE SALES OFFICES - Klang Valley

AAAAA Wealth Builders

Lot C-615 & Lot C-616, Level 6, Block C, Kelana Square, 17 Jalan SS7/26, Kelana Jaya, 47301 Petaling Jaya, Selangor.

03-7880 6893

ACES Advisors 37-2, Jalan Cecawi 6/33, PJU 5, Kota Damansara, 47810 Petaling Jaya, Selangor.

03-6142 2970

Charisma Legacy B-1-22, B-2-21 & B-2-22, Block Bougainvillea, 10 Boulevard, Lebuhraya Sprint, PJU 6A, Kayu Ara, Damansara Jaya, 47400 Petaling Jaya, Selangor.

03-7722 3895

Charisma Legacy 2 B-3-21, Block Bougainvillea, 10 Boulevard, Lebuhraya Sprint, PJU 6A, Kayu Ara, Damansara Jaya, 47400 Petaling Jaya, Selangor.

03-7733 5009

Charisma Legacy 3 B-3-25, Block Bougainvillea, 10 Boulevard, Lebuhraya Sprint, PJU 6A, Kayu Ara, Damansara Jaya, 47400 Petaling Jaya, Selangor.

03-7733 2460

Charisma Legacy Damansara

B-3-17, Block Bougainvillea, 10 Boulevard, Lebuhraya Sprint, PJU 6A, Kayu Ara, Damansara Jaya, 47400 Petaling Jaya, Selangor.

03-7733 4211

Diamond Star Agency Office

Block E-1-03A & E-2-03A, Jalan SS6/20A, Dataran Glomac, 47301 Kelana Jaya, Selangor.

03-7880 7082

Dynamics Wealth Advisors

Unit B-3A-1, Setiawangsa Business Suites, Jalan Setiawangsa 11, Taman Setiawangsa, 54200 Kuala Lumpur.

03-4256 6277

Elite Group Consultants

6-2, Jalan Dagang 1/1A, Taman Dagang, 68000 Ampang, Selangor.

03-4251 1129

Emmaz Wealth Empire

17-2, Jalan Rampai Maju 1, Taman Sri Rampai, 53300 Kuala Lumpur.

03-4141 7574

Evoque Wealth Advisors

2nd Floor, 32A-2, Jalan PJU 5/20D, The Strand, Pusat Perdagangan Kota Damansara, PJU 5, Kota Damansara, 47810 Petaling Jaya, Selangor.

03-6151 9512

Fidelis Wealth Advisors

70-2, Jalan Tasik Utama 7, Medan Niaga Tasik Damai, The Trillium Lake Fields, 57000 Sungai Besi, Kuala Lumpur.

03-9054 8596

Global Amazing Entrepreneur

C-10-2 & C-11-2, Bangi Gateway Shopping Complex, Persiaran Pekililing, Seksyen 15, 43650 Bandar Baru Bangi, Selangor.

03-8920 9038

JAT XO Group D-10-08-G & D10-08-1, Pusat Perdagangan Dana 1, Jalan PJU 1A/46, 47301 Petaling Jaya, Selangor.

03-7831 1267


64

LIST OF CWA (an Agency force of CIMB-Principal) OFFICES (CONTINUED) ADDRESS TELEPHONE SALES OFFICES - Klang Valley (Continued)

KPG Capital Growth Solution

15-1, Jalan Adenium 2G/9, Adenium Business Centre, 48300 Bukit Beruntung, 48300 Rawang, Selangor.

03-6021 7188

KPG Management Resources

19-2, Jalan Adenium 2G/9, Adenium Business Centre, Bukit Beruntung, 48300 Rawang, Selangor.

03-6021 7385

Magnificent Champion Agency Office

47A, Tingkat 1, Jalan Badminton 13/29, Seksyen 13, 40100 Shah Alam, Selangor.

03-5523 2693

Megas 2-6A, Jalan PJU 8/3A, Bandar Damansara Perdana, 47820 Petaling Jaya, Selangor.

03-7725 6320

Monalisa Private Wealth Advisors

41B & 43B, Jalan Wan Kadir 2, Taman Tun Dr Ismail, 60000 Kuala Lumpur.

03-7724 1789

My Financial Freedom Advisors

3A, Jalan Hentian 3, Pusat Hentian Kajang, 43000 Kajang, Selangor.

03-8741 4382

NRICH Wealth Advisory Group

ZP-02-12, Zest Point, Lebuhraya Bukit Jalil, Bandar Kinrara, 47180 Puchong, Selangor.

03-8074 8485

NSG Wealth Advisors

32-3, 4th Floor, Jalan Wangsa Delima 6, Kuala Lumpur Satelite Centre (KLSC), Section 5 Wangsa Maju, 53300 Kuala Lumpur.

03-4142 2911

Otye Xcellence Consultants

Lot 35-2, 2nd Floor, Jalan Sepah Puteri 5/1B, Pusat Dagangan Seri Utama, PJU 5, Kota Damansara, 47410 Petaling Jaya, Selangor.

03-6140 3046

Platinum A-2-1, Block A, 8 Jalan PJU 1A/20A, Dataran Ara Damansara, 47301 Petaling Jaya, Selangor.

03-7843 0506

Platinum 2 A-2-3, Block A, 8 Jalan PJU 1A/20A, Dataran Ara Damansara, 47301 Petaling Jaya, Selangor.

03-7843 0503

Preferred Wealth Advisors

12-01, D’Bayu Business Centre, Jalan Serambi U8/24, Bukit Jelutong, 40150 Shah Alam, Selangor.

03-6142 8382

Prestige Wealth Advisors

I-91-2, Block I, Jalan Teknologi 3/9, Kota Damansara, 47810 Petaling Jaya, Selangor.

03-6140 7275

SA@7 35B-2 (2nd Floor), Jalan Keluli Am7/Am, Pusat Perniagaan Bukit Raja, Seksyen 7, 40000 Shah Alam, Selangor.

03-3341 4978

Success Concepts Life Planners

J-06-01, Level 6, Block J, Solaris Mont’ Kiara, Jalan Solaris, 50480 Kuala Lumpur.

03-6204 0113


65

LIST OF CWA (an Agency force of CIMB-Principal) OFFICES (CONTINUED)

ADDRESS TELEPHONE

SALES OFFICES - Klang Valley (Continued)

SWM Advisors Group

Block E-13-2, 2nd Floor, Jalan Serai Wangi M/16M, Alam Avenue 2 Seksyen 16, 40200 Shah Alam, Selangor.

019-388 2067

Synergy Wealth Entrepreneur

98-2, Jalan Dwitasik, Dataran Dwitasik, Bandar Sri Permaisuri, Cheras, 56000 Kuala Lumpur.

03-9226 5344

The One Asia Advisors

B-3A-23, Merchant Square, Jalan Tropicana Selatan 1, Tropicana Golf & Country Resort, 47410 Petaling Jaya, Selangor.

03-7887 4408

Tremendous Agency

65-2, Jalan Nelayan A, 19/A Pusat Daerah Seksyen 19, 40300 Shah Alam, Selangor.

03-5480 0296

Wealth Resources Group Advisors

41B, 3B Curve Business Park, Medan Pusat Bandar 2D, Seksyen 9, 43650 Bandar Baru Bangi, Selangor.

03-8926 4155

SALES OFFICES - Northern

Zenith Premier Wealth Advisors

98, 2nd Floor, Jalan Lagenda 1, Lagenda Heights, 08000 Sungai Petani, Kedah.

04-424 6042

SALES OFFICES - Southern

GVG Pasir Gudang Solution

38-01, Jalan Serangkai 18, Taman Bukit Dahlia, 81700 Pasir Gudang, Johor.

012-707 6107

GVG Solution Agency

24-1, Jalan Padi Emas 4/1, Pusat Bandar Tampoi, 81200 Johor Bahru, Johor.

07-232 6976

Kyzan Jaguar Agency

16-01, Jalan Padi Emas 1/5, UDA Business Centre, 81200 Johor Bahru, Johor.

07-300 9350

PremierOne Wealth 527-1, Jalan Pusat Bandar Senawang, Pusat Bandar Senawang, 70450 Senawang, Negeri Sembilan.

06-671 8253

Premier Wealth Advisors

18-1, Jalan S2 B18, Biz Avenue Seremban 2, 70300 Seremban, Negeri Sembilan.

06-601 5749

Soha Barakah Wealth Consultancy

55-2, 57-2 & 59-2, Jalan TU 49A, Taman Tasik Utama, Ayer Keroh, 75450, Melaka.

06-2533 289

Victorious Agency 98-02 Jalan Pertama 1, Pusat Perdagangan Danga Utama, 81200 Johor Bahru, Johor.

011-121 1840


66

LIST OF CWA (an Agency force of CIMB-Principal) OFFICES (CONTINUED)

ADDRESS TELEPHONE SALES OFFICES - East Coast AMG Synergy Multiresources Sdn Bhd

50, Tingkat 1, Jalan Putra Square 1, Malay Town, 25200 Kuantan, Pahang.

09-516 1430

Charisma Legacy Kota Bharu

PT1671 & 1672, Tingkat 2, Jalan Raja Perempuan Zainab 2, Kubang Kerian, 16150 Kota Bharu, Kelantan.

016-223 6343

My IFP Kemaman PT 10725, Ground Floor, Jalan Kubang Kurus, Taman Cukai Utama Fasa 4, 24000, Kemaman, Terengganu.

09-858 9911

NZ Group PT 650, 1st & 3rd Floor, Jalan Sri Cemerlang, Seksyen 27,15300 Kota Bharu, Kelantan.

09-747 6932

SALES OFFICES - East Malaysia

JAT XO Group Bintulu

Shop Lot 2, Block 49, Of Parent Lot 2646, Park City Commerce Square, Jalan Kambar Bubin Off Jalan Tun Ahmad Zaidi, 97000 Bintulu, Sarawak.

012-217 2269

Sibu 15A, Jalan Ruby, 96000 Sibu, Sarawak. 084-325 515

cimb islamic dali equity fund financial statement …€¦ · cimb islamic dali equity fund...

Documents