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CIMB ISLAMIC PRS PLUS GROWTH UNAUDITED FINANCIAL STATEMENTS FOR THE SIX MONTHS FINANCIAL PERIOD ENDED 28 FEBRUARY 2018

CIMB ISLAMIC PRS PLUS GROWTH

CONTENTS PAGE(S) MEMBERS’ LETTER 1 SHARIAH ADVISER’S REPORT 2 STATEMENT BY THE PRS PROVIDER 3 TRUSTEE’S REPORT 4 PRS PROVIDER’S REPORT 5 - 15

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

UNAUDITED STATEMENT OF COMPREHENSIVE INCOME 16 UNAUDITED STATEMENT OF FINANCIAL POSITION 17 UNAUDITED STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO MEMBERS 18 UNAUDITED STATEMENT OF CASH FLOWS 19 NOTES TO THE FINANCIAL STATEMENTS 20 - 47 DIRECTORY 48


1

MEMBERS’ LETTER

Dear Valued Member,

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 1st Quarter of 2018 with RM52.06 billion in Asset under Management (“AUM”).

Our AUM for Private Retirement Schemes (“PRS”) business increased by 33% year-on-year (“y-o-y”) to RM541 million as at 31 March 2018.

We continue to achieve prestigious recognitions from The Edge | Thomson Reuters Lipper Fund Awards as follows:

The Edge| Thomson Reuters Lipper Malaysia Fund Awards 2018

Best Fund Over 5 Years, Equity Global - Malaysia : CIMB-Principal Global Titans Fund

Best Fund Over 5 Years, Equity Asia Pacific ex Japan - Malaysia : CIMB-Principal Asian Equity Fund

Best Fund Over 5 Years, Equity Asia Pacific ex Japan - Malaysia : CIMB Islamic Asia Pacific Equity Fund

Best Fund Over 5 Years, Equity Malaysia Diversified - Malaysia : CIMB-Principal Equity Growth & Income Fund

Best Fund Over 5 Years, Mixed Asset MYR Balanced - Malaysia : CIMB-Principal Income Plus Balanced Fund

Best Fund Over 3 Years, Equity Global - Malaysia : CIMB-Principal Global Titans Fund

Thomson Reuters Lipper Fund Award Global Islamic 2017

Best Equity Asia Pacific Ex-Japan (Islamic), Best Fund over 5 years : CIMB Islamic Asia Pacific Equity Fund

These prestigious awards are a celebration of the trust that you have placed in us and testament to our capability in bringing potential value to your financial goals and needs.

CIMB-Principal was also awarded Fund House of the Year in Malaysia by AsianInvestor for the 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.

Pursuant to Schedule B1 Investment Restrictions and Limits for Core Funds under the Default Option of the Securities Commission Malaysia (“SC”) Guidelines on PRS, investment of core funds into one or more collective investment schemes of the same PRS Provider (“target funds”) is permitted for a five-year period from the launch of the Scheme or upon reaching RM200 million Net Asset Value (“NAV”) (whichever is earlier). The five-year period expired on 12 November 2017 and hence effective from end of October 2017, the Fund has sold its position in collective investment schemes and reinvested directly in the market in accordance to the Fund’s investment policy and principal investment strategy.

Thank you.

Yours faithfully, for CIMB-Principal Asset Management Berhad

Munirah Khairuddin Chief Executive Officer


2

SHARIAH ADVISER’S REPORT TO THE MEMBERS OF CIMB ISLAMIC PRS PLUS GROWTH We have acted as the Shariah Adviser of CIMB Islamic PRS Plus Growth (the “Fund”) for the six months financial period ended 28 February 2018. Our responsibility is to ensure that the procedures and processes employed by CIMB-Principal Asset Management Berhad (the “PRS provider”) are in accordance with Shariah and Shariah Investment Guidelines. In our opinion, the PRS provider 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 six months financial period ended 28 February 2018. In addition, we 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 and, where applicable the Shariah Advisory Council of Bank Negara Malaysia. For investments other than the abovementioned, we have reviewed the same and are of the opinion that these investments were in accordance with the Shariah Investment Guidelines of the Fund.

This report is made solely to the members 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 PRS provider. For and on-behalf of the Shariah Adviser CIMB Islamic Bank Berhad ASHRAF GOMMA ALI Director/Regional Head, Shariah & Governance/Designated Person Responsible for Shariah Advisory Kuala Lumpur 20 April 2018


3

STATEMENT BY THE PRS PROVIDER TO THE MEMBERS OF CIMB ISLAMIC PRS PLUS GROWTH We, being the Directors of CIMB-Principal Asset Management Berhad (the “PRS Provider”), do hereby state that, in the opinion of the PRS Provider, the accompanying unaudited financial statements set out on pages 16 to 47 are drawn up in accordance with the provisions of the Deeds and give a true and fair view of the statement of financial position of the Fund as at 28 February 2018 and of its financial performance, changes in net assets attributable to members and cash flows for the financial period then ended in accordance with Malaysian Financial Reporting Standards (“MFRS”) 134 - Interim Financial Reporting and International Accounting Standards (“IAS”) 34 - Interim Financial Reporting. For and on behalf of the PRS Provider CIMB-Principal Asset Management Berhad (Company No.: 304078-K) MUNIRAH KHAIRUDDIN ALEJANDRO ECHEGORRI Chief Executive Officer/Executive Director Executive Director Kuala Lumpur 23 April 2018


4

TRUSTEE’S REPORT TO THE MEMBERS OF CIMB ISLAMIC PRS PLUS GROWTH We have acted as Trustee for CIMB Islamic PRS Plus Growth (the “Fund”) for the six months financial period ended 28 February 2018. To the best of our knowledge, for the six months financial period under review, CIMB-Principal Asset Management Berhad (the “PRS Provider”) has operated and managed the Fund in accordance with the following:- (a) limitations imposed on the investment powers of the PRS Provider under the Deed(s), the

Securities Commission’s Guidelines on Private Retirement Schemes, the Capital Markets and Services Act 2007 and other applicable laws;

(b) valuation and pricing for the Fund has been carried out in accordance with the Deed(s) of the

Fund and applicable regulatory requirements; and (c) creation and cancellation of units for the Fund have been carried out in accordance with the

Deed(s) of the Fund and applicable regulatory requirement. For Deutsche Trustees Malaysia Berhad SOON LAI CHING RICHARD LIM HOCK SENG Senior Manager, Trustee Operations Chief Executive Officer Kuala Lumpur 20 April 2018


5

PRS PROVIDER’S REPORT FUND OBJECTIVE AND POLICY

What is the investment objective of the Fund? The Fund seeks to provide capital growth over the long-term by investing in a portfolio of primarily Shariah-compliant equities with some exposure in Sukuk. Has the Fund achieved its objective? For the financial period under review, the Fund has performed in line with its objective as stated under the Fund Performance section.

What are the Fund investment policy and principal investment strategy? The Fund will invest in a portfolio of mixed assets, primarily in Shariah-compliant equities with some exposure in Sukuk, to provide capital growth to the Fund. The investments by the Fund in Shariah-compliant equities which include foreign exposure shall not exceed 70% of the Fund’s NAV and investments in both local and foreign Sukuk shall not be less than 30% of its NAV with a minimum credit rating of “BBB3” or “P2” by RAM Ratings (“RAM”) or equivalent rating by Malaysian Rating Corporation Berhad (“MARC”) or “BBB” by Standard & Poor's (“S&P”) or equivalent rating by Moody’s or Fitch. The fixed income portion will provide capital stability to the Fund whilst the equity portion will provide the added return in a rising market. The Fund may opt to invest in Sukuk and Shariah-compliant equities either directly or via Shariah-compliant collective investment schemes. Fund category/type Core (Growth)

When was the Fund launched? 12 November 2012 What was the size of the Fund as at 28 February 2018? RM49.74 million (73.03 million units) What is the Fund’s benchmark? 70% Financial Times Stock Exchange (“FTSE”) Bursa Malaysia ("FBM") EMAS Shariah ("FBMS") Index + 30% Quant shop Government Investment Issues (“GII”) Short Index Note: The risk profile of the Fund is not the same as the risk profile of the benchmark.

What is the Fund distribution policy? The Fund is not expected to pay any distribution.


6

PERFORMANCE DATA Details of portfolio composition of the Fund for the last three financial periods are as follows:

28.02.2018 28.02.2017 29.02.2016

% % % Shariah-compliant collective investment schemes - 98.22 97.72

Shariah-compliant quoted securities

- Basic Materials 3.43 - -

- Construction 3.07 - -

- Consumer Products 13.23 - -

- Energy 6.54 - -

- Finance 6.23 - -

- Industrials 2.55 - -

- Infrastructure Project Companies (“IPC”) 0.63 - -

- Plantation 2.15 - -

- Properties 0.04 - -

- Real Estate Investment Trust (“REITs”) 6.42 - -

- Technology 10.99 - -

- Telecommunications 1.18 - -

- Trading/Services 9.82 - -

Unquoted Sukuk 31.97 - -

Cash and other net assets 1.75 1.78 2.28

100.00 100.00 100.00

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

28.02.2018 28.02.2017 29.02.2016

NAV (RM Million)

- Class A 23.16 15.98 10.53

- Class C 1.96 1.29 0.89

- Class X 24.62 16.51 9.68

Units in circulation (Million)

- Class A 34.00 25.89 18.66

- Class C 2.88 2.09 1.58

- Class X 36.15 26.76 17.15

NAV per unit (RM)

- Class A 0.6811 0.6171 0.5643

- Class C 0.6810 0.6171 0.5642

- Class X 0.6810 0.6171 0.5643

01.09.2017

to 28.02.2018 01.09.2016

to 28.02.2017 01.09.2015

to 29.02.2016

Highest NAV per unit (RM)

- Class A 0.7011 0.6219 0.6008

- Class C 0.7011 0.6218 0.6008

- Class X 0.7011 0.6219 0.6008

Lowest NAV per unit (RM)

- Class A 0.6628 0.5899 0.5516

- Class C 0.6627 0.5898 0.5516

- Class X 0.6627 0.5899 0.5516


7

PERFORMANCE DATA (CONTINUED) Performance details of the Fund for the last three financial periods are as follows (continued):

01.09.2017

to 28.02.2018 01.09.2016

to 28.02.2017 01.09.2015

to 29.02.2016

Total return (%)

- Class A 1.88 2.88 (2.55)

- Class C 1.88 2.90 (2.55)

- Class X 1.88 2.88 (2.55)

Capital growth (%)

- Class A 1.88 2.88 (2.55)

- Class C 1.88 2.90 (2.55)

- Class X 1.88 2.88 (2.55)

Income distribution (%)

- Class A - - -

- Class C - - -

- Class X - - -

Management Expense Ratio (“MER”) (%) ^ 0.12 0.08 0.08

Portfolio Turnover Ratio (“PTR”) (times) # 1.29 0.50 0.19 ^ The Fund’s MER increased from 0.08% to 0.12% due to increased expenses during the financial

period under review. # The Fund’s PTR increased from 0.50 times to 1.29 times mainly due to our strategy to invest

directly in securities.

28.02.2018 28.02.2017 29.02.2016 28.02.2015 28.02.2014

% % % % %

Annual total return

- Class A 10.39 9.03 (1.19) 6.45 9.17

- Class C 10.37 9.05 (1.19) 6.45 9.17

- Class X 10.37 9.03 (1.19) 6.45 9.17 (Launch date: 12 November 2012) 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 period have been extracted from Lipper.

MARKET REVIEW (1 SEPTEMBER 2017 TO 28 FEBRUARY 2018)

Unquoted Sukuk During the financial period under review, Bank Negara Malaysia (“BNM”) kept its Overnight Policy Rate (“OPR”) unchanged at its Monetary Policy Committee (“MPC”) meeting held on 9 November 2017. BNM commented that the stance of monetary policy remains accommodative but added that “given the strength of the global and domestic macroeconomic conditions, the MPC may consider reviewing the current degree of monetary accommodation. This is to ensure the sustainability of the growth prospects of the Malaysian economy.” This statement signaled the Central Bank’s readiness to review the OPR and follows their bullish assessment that growth prospects are expected to remain strong in 2018. On the Malaysian economy, BNM highlighted that growth has become more entrenched with continued strong performance from the domestic and external sectors. As for global growth, BNM maintained that the global economy continues to strengthen, with growth becoming “more entrenched and synchronized across countries”.


8

MARKET REVIEW (1 SEPTEMBER 2017 TO 28 FEBRUARY 2018) (CONTINUED) Unquoted Sukuk (Continued) In its subsequent MPC meeting held on 25 January 2018, BNM raised its OPR by 25 basis points (“bps”) to 3.25%, citing the steady growth path for the economy and as a pre-emptive move to prevent a build-up of risks that could arise from low interest rates for a prolonged period of time. The Central Bank views that global growth will accelerate in 2018. It views that the global economy has continued to strengthen, with global trade performing at a sustained pace. On the domestic front, BNM expects the strong growth momentum to carry on into 2018, on the back of spillovers from the external sector to the domestic economy. On the price front, the Central Bank expects the inflation rate to moderate in 2018, on account of a reduced effect of global cost factors, while the stronger Malaysian Ringgit (“MYR”) would also translate to lower import prices after the MYR strengthened from RM4.271 to RM3.917 against US Dollar (“USD”) during the financial period under review. Consequently, the domestic Sukuk market experienced some selloff with yields rising across the board in particular the GII with yields on the 3-year to 15-year GII traded wider by 10 bps to 20 bps while the 20-year to 30-year GII rose by only 1 bps to 6 bps during the financial period under review. Corporate Sukuk yields also traded higher with yields rising in the range of 3 bps to 18 bps overall. On the economic front, Malaysia recorded real Gross Domestic Product (“GDP”) growth of 5.9% y-o-y, slowing down from +6.2% y-o-y in the third quarter of 2017. This is mainly due to a slowdown in exports however, domestic demand remained resilient. For the full-year 2017, Malaysia recorded a stellar GDP growth of 5.9% y-o-y (2016: 4.2% y-o-y), the fastest in three years, mainly due to a surge in exports and subsequent pick-up in domestic demand. Meanwhile inflationary pressure continues to eased with Consumer Price Index (“CPI”) growth in January 2018 and February 2018 eased to a low of 2.7% and 1.4% y-o-y respectively (December 2017: +3.5% y-o-y) on slower rise in fuel and food prices, while core inflation rate in January 2018 remained at +2.2% y-o-y but slowed to 1.8% y-o-y in February 2018 (December 2017: +2.2% y-o-y).

Local Equity The FBMS Index rose by 678.42 points or 1.1% to 13,427.51 points over the financial period under review. The FBMS Index rose in September 2017 and October 2017 on the back of higher crude oil price, stronger-than-expected third quarter of 2017 GDP growth and a stronger MYR in anticipation of BNM’s OPR hike in 2018. It then fell by 1.2% in November 2017 as construction stocks underperformed on worries of foreign contractors’ dominance after a change in Mass Rapid Transit Line 3 (“MRT3”) project delivery partners (“PDP”) format to turnkey contractor with mandatory funding. The FBMS Index then recovered by 3.0% in December 2017 on the back of window dressing activities, driven by technology stocks. For 2017, net foreign inflows amounted to RM10.3 billion. The FBMS Index started on a positive note in 2018 by rising 2.7% in January 2018 on the back of outperformance in Permodalan Nasional Berhad (“PNB”) related companies. The buoyant market was also aided by the strengthening of the MYR by 3.9% and the increase in crude oil prices by 3.3% during the month. Foreign investors were net buyers of RM3.4 billion in January 2018. February 2018 was a volatile month as investors began re-pricing more and earlier interest rate hikes in the US, on the back of higher inflation expectations. In line with the global rout, the FBMS Index fell by 1.7% to 13,427.51 points. Consumer price inflation eased in January 2018 to 2.7% (3.5% y-o-y in December 2017) due to currency gains and a higher base, as fuel prices and electricity tariffs were raised a year ago. In February 2018, foreign investors net sold about RM1.1 billion.


9

MARKET REVIEW (1 SEPTEMBER 2017 TO 28 FEBRUARY 2018) (CONTINUED) Foreign Equity The Morgan Stanley Capital International All Country (“MSCI AC”) Asia ex Japan Islamic Index posted a solid gain of 8.74%, in USD term, closing at 1,399.71 points over the financial period under review. In MYR term, the Index fell slightly lower by 0.11%. Asian equities eased 0.3% in USD terms in September 2017. Technology and consumer discretionary outperformed while materials and telecommunications underperformed. It then rebounded sharply in October 2017 and ended the fourth quarter being the best performing region in Emerging Markets (“EM”) in 2017. The 19th National Congress of the Communist Party of China was held on 18 to 25 October 2017 in Beijing, with the new leadership team announced. The Indian Government announced a bold plan to recapitalize state-owned banks. China and South Korea agreed to mend ties after the Terminal High Altitude Area Defense (“THAAD”) feud. The European Central Bank (“ECB”) announced it would extend quantitative easing (“QE”) by nine months, to September 2018, at a reduced pace of EUR30 billion per month. December 2017 was marked by tax cuts in the US, the US Federal Reserve (the “Fed”) hikes, strong European growth indicators, and People’s Bank of China (“PBOC”) raising open market operations (“OMO”) rate by 5 bps. Market continued its rally in January 2018, on the back of positive revisions to global growth, lack of USD strength (post US tax reform), and increasing commodities prices. However, Asian equities went into a risk-off mode and slipped 4.9% month-on-month (“m-o-m”) in USD terms in February 2018 triggered by a surge in US 10-year yields and concerns of higher inflation. The selloff was broad-based with underperformance in energy, telecoms, industrials, real estate and financials while healthcare was the only gainer. FUND PERFORMANCE

6 months to 28.02.2018

1 year to 28.02.2018

3 years to 28.02.2018

Class

A Class

C Class

X Class

A Class

C Class

X Class

A Class

C Class

X

% % % % % % % % %

Income - - - - - - - - -

Capital 1.88 1.88 1.88 10.39 10.37 10.37 18.92 18.93 18.91

Total Return 1.88 1.88 1.88 10.39 10.37 10.37 18.92 18.93 18.91

Benchmark 2.84 2.84 2.84 5.20 5.20 5.20 9.15 9.15 9.15

Average Total Return N/A N/A N/A 10.39 10.37 10.37 5.95 5.95 5.94

5 years to 28.02.2018

Since inception to 28.02.2018

Class

A Class

C Class

X Class

A Class

C Class

X

% % % % % %

Income - - - - - -

Capital 38.20 38.21 38.18 36.24 36.22 36.22

Total Return 38.20 38.21 38.18 36.24 36.22 36.22

Benchmark 20.16 20.16 20.16 20.71 20.71 20.71

Average Total Return 6.68 6.69 6.68 6.01 6.00 6.00


10

FUND PERFORMANCE (CONTINUED) For the 6-month period, Class A, Class C and Class X gained 1.88%. Meanwhile, the benchmark appreciated by 2.84% over the same reporting period. The underperformance of the Fund relative to its benchmark was driven mainly by the allocation into equities. The slight variation in the performance between Class A, Class C and Class X, if any, was due to different timing of units created for each class. 6 months to 28.02.2018

1 year to 28.02.2018

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

4.50%

Class A, C and X*

Benchmark

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

Class A, C and X*

Benchmark


11

FUND PERFORMANCE (CONTINUED) 3 years to 28.02.2018

5 years to 28.02.2018

-5.00%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

Class A, C and X*

Benchmark

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

Class A, C and X*

Benchmark


12

FUND PERFORMANCE (CONTINUED) Since inception to 28.02.2018

* Performance of Class A, Class C and Class X are almost the same. Slight variation was due to different timing of units

created for each of the class.

Changes in NAV

CLASS A 28.02.2018 28.02.2017 Changes

%

NAV (RM Million) 23.16 15.98 44.93

NAV/Unit (RM) 0.6811 0.6171 10.37

CLASS C 28.02.2018 28.02.2017 Changes

%

NAV (RM Million) 1.96 1.29 51.94

NAV/Unit (RM) 0.6810 0.6171 10.35

CLASS X 28.02.2018 28.02.2017 Changes

%

NAV (RM Million) 24.62 16.51 49.12

NAV/Unit (RM) 0.6810 0.6171 10.35 The Fund recorded positive net inflow from unit creations over the financial period under review for all the three classes - Class A, Class C and Class X. The NAV per unit of Class A rose by 10.37%, over the 1-year period. Meanwhile, the NAV per unit of both Class C and Class X grew by 10.35%. For the 1-year period, the Fund ranked 5th in Quartile 3 under the Mixed Asset MYR Aggressive Islamic category in the Lipper rankings.

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 period have been extracted from Lipper.

-5.00%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

Class A, C and X*

Benchmark


13

PORTFOLIO STRUCTURE Asset allocation

(% of NAV) 28.02.2018 28.02.2017

Shariah-compliant collective investment schemes - 98.22

Shariah-compliant quoted securities 66.28 -

Unquoted Sukuk 31.97 -

Cash and other net assets 1.75 1.78

TOTAL 100.00 100.00

The Fund was fully invested during the financial period under review. A minimal level of liquid assets was maintained primarily for redemption purposes. At the reporting date, some material amount of creations was still sitting in the receivables which will be invested into securities. MARKET OUTLOOK* Unquoted Sukuk After signalling a possible monetary policy normalisation in its MPC meeting in November 2017, BNM decided to raise its OPR by 25 bps to 3.25% on 25 January 2018 citing that it was a pre-emptive move to prevent the build-up of risks that could arise from low interest rates for a prolonged period of time. It also stated that at current OPR level, the stance of monetary policy “remains accommodative”. We believe that BNM will pause for the rest of 2018 but we will re-assess the outlook in the second half of 2018 taking into consideration the 2018 first two quarters’ domestic GDP growth and core inflation. For 2018, there will be a total of 33 auctions comprising of 15 Malaysia Government Securities (“MGS”) and 18 GII issuances compared to 32 auctions seen in 2017. The gross issuances for 2018 is expected to be around RM103 billion with sizeable maturities of about RM62.8 billion after BNM conducted a fixed income switching exercise reducing the 2018 MGS/MGII maturity amount. We expect BNM to target more issuances with longer durations to manage the maturities which are now mostly concentrated in the short end. The targeted amounts of private placements are smaller in 2018 versus 2017 with the bulk of it being in first quarter of 2018. We expect similar primary issuances for government guaranteed financing but anticipate lower issuances on the lower rated corporate financing. Local Equity Market will remain volatile as investors digest the recent corporate earnings, monitor inflation expectations and watch global central banks dial back their balance sheets. While markets may correct, we remain optimistic that these corrections are not the start of a bear market. Hence, we will stay invested, but continue to trim portfolio risk by reducing exposure to stocks which have risen exponentially.


14

MARKET OUTLOOK (CONTINUED)* Foreign Equity Upside in Asian equities should be guided by earnings growth of about 13% in 2018, but the volatility could be higher given trade tensions, rising fixed income yields and credit spreads, and diminishing Central Bank fixed income purchases. Investor sentiment on the “Goldilocks” scenario (growth that is not too high as to stoke inflation) will also be tested especially if US wage growth data shows a pick-up significantly beyond 3%. Our view is that US corporates can manage a gradual rise through better productivity and pricing. * 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 In November 2017, the Fund began investing directly in securities. Being one of the core funds under PRS, we will continue to remain fully invested with minimal cash kept for redemption purposes. MEMBERS STATISTICS AS AT 28 FEBRUARY 2018 CLASS A

Size of unit holdings (units) No. of members No. of units held (million)

% of units held

5,000 and below 6,628 11.39 33.51

5,001-10,000 1,224 8.23 24.17

10,001-50,000 569 9.93 29.21

50,001-500,000 42 4.45 13.11

500,001 and above - - -

Total 8,463 34.00 100.00

CLASS C


% of units held

5,000 and below 484 0.74 25.61

5,001-10,000 102 0.69 23.88

10,001-50,000 69 1.03 35.64

50,001-500,000 3 0.42 14.87

500,001 and above - - -

Total 658 2.88 100.00


15

MEMBERS STATISTICS AS AT 28 FEBRUARY 2018 (CONTINUED) CLASS X


% of units held

5,000 and below 7,997 9.56 26.77

5,001-10,000 1,355 9.73 26.94

10,001-50,000 783 14.45 39.89

50,001-500,000 24 2.41 6.40

500,001 and above - - -

Total 10,159 36.15 100.00

SOFT COMMISSIONS AND REBATES The PRS Provider 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 period under review, the PRS Provider and the Trustee did not receive any rebates from the brokers or dealers but have retained soft commissions in the form of goods and services such as financial wire services and stock quotations system incidental to investment management of the Funds.


16

UNAUDITED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS FINANCIAL PERIOD ENDED 28 FEBRUARY 2018

01.09.2017 to 28.02.2018

01.09.2016 to 28.02.2017

Note RM RM

INVESTMENT INCOME

Dividend income

288,441 128,307

Profit income 6 202,924 - Net gain on financial assets at fair value through profit or loss 8 605,719 778,664

Net foreign exchange loss

(135,920) -

961,164 906,971

EXPENSES

Private Pension Administrator's fee 4 9,115 5,990

Trustee’s and custodian fees 5 16,111 5,990

Audit fee

6,341 5,210

Tax agent’s fee

4,600 2,000

Transaction costs

102,212 -

Other expenses

22,157 7,323

160,536 26,513

PROFIT BEFORE TAXATION

800,628 880,458

Taxation 7 (6,612) -

INCREASE IN NET ASSETS ATTRIBUTABLE TO MEMBERS

794,016 880,458

Increase in net assets attributable to members is made up as follows:

Realised amount

3,251,153 724,038

Unrealised amount

(2,457,137) 156,420

794,016 880,458

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


17

UNAUDITED STATEMENT OF FINANCIAL POSITION AS AT 28 FEBRUARY 2018

28.02.2018 31.08.2017

Audited

Note RM RM

ASSETS

Cash and cash equivalents (Shariah-compliant) 9 578,093 75,169 Financial assets at fair value through profit or loss (Shariah-compliant) 8 48,867,023 41,618,816

Amount due from stockbrokers

443,490 -

Amount due from the PRS Provider 10 630,885 488,319

Dividends receivable

48,293 -

Tax recoverable

56 56

TOTAL ASSETS

50,567,840 42,182,360

LIABILITIES

Amount due to stockbrokers

788,721 -

Amount due to the PRS Provider 10 19,626 74,014

Other payables and accruals

18,841 17,765

TOTAL LIABILITIES (EXCLUDING NET ASSETS ATTRIBUTABLE TO MEMBERS)

827,188 91,779

NET ASSET VALUE OF THE FUND

49,740,652 42,090,581

NET ASSETS ATTRIBUTABLE TO MEMBERS

49,740,652 42,090,581

REPRESENTED BY:

FAIR VALUE OF OUTSTANDING UNITS

- Class A

23,158,058 19,381,123

- Class C

1,964,012 1,685,036

- Class X

24,618,582 21,024,422

49,740,652 42,090,581

NUMBER OF UNITS IN CIRCULATION (UNITS)

- Class A

34,000,169 28,990,175

- Class C

2,883,743 2,520,426

- Class X

36,145,619 31,449,076

11 73,029,531 62,959,677

NET ASSET VALUE PER UNIT (RM)

- Class A

0.6811 0.6685

- Class C

0.6810 0.6685

- Class X

0.6810 0.6685



18

UNAUDITED STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO MEMBERS FOR THE SIX MONTHS FINANCIAL PERIOD ENDED 28 FEBRUARY 2018

01.09.2017

to 28.02.2018 01.09.2016

to 28.02.2017

RM RM

NET ASSETS ATTRIBUTABLE TO MEMBERS AT THE BEGINNING OF THE FINANCIAL PERIOD 42,090,581 27,177,310

Movement due to units created and cancelled during the financial period:

- Creation of units from applications 8,545,770 6,716,750

- Cancellation of units (1,689,715) (994,872)

48,946,636 32,899,188

Increase in net assets attributable to members during the financial period 794,016 880,458

NET ASSETS ATTRIBUTABLE TO MEMBERS AT THE END OF THE FINANCIAL PERIOD 49,740,652 33,779,646



19

UNAUDITED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS FINANCIAL PERIOD ENDED 28 FEBRUARY 2018

01.09.2017 to 28.02.2018

01.09.2016 to 28.02.2017

RM RM

CASH FLOWS FROM OPERATING ACTIVITIES

Proceeds from disposal of Shariah-compliant quoted

securities

6,333,473 - Proceeds from disposal of Shariah-compliant collective investment schemes

44,509,982 11,510,000

Proceeds from disposal of unquoted Sukuk

5,324,474 -

Purchase of Shariah-compliant quoted securities

(39,196,466) - Purchase of Shariah-compliant collective investment schemes

(1,958,343) (16,922,000)

Purchase of unquoted Sukuk

(21,278,749) -

Dividend income received

233,536 - Profit income received from Shariah-compliant deposits with licensed Islamic financial institutions

4,708 -

Profit income received from unquoted Sukuk

228,507 -

Private Pension Administrator’s fees paid

(9,017) (5,805)

Trustee's and custodian fees paid

(16,013) (5,805)

Payments for other fees and expenses

(32,218) (16,263)

Tax refund received

- 996

Net realised foreign exchange loss

(259,088) -

Net cash used in operating activities

(6,115,214) (5,438,877)

CASH FLOWS FROM FINANCING ACTIVITIES

Cash proceeds from units created

8,403,204 6,497,389

Payments for cancellation of units

(1,724,103) (996,974)

Net cash generated from financing activities

6,679,101 5,500,415

Net increase in cash and cash equivalents

563,887 61,538

Effects of foreign exchange differences

(60,963) - Cash and cash equivalents at the beginning of the financial period

75,169 33,152

Cash and cash equivalents at the end of the financial period

578,093 94,690

Cash and cash equivalents comprised of:

Shariah-compliant deposits with licensed Islamic

financial institutions

470,041 -

Bank balances

108,052 94,690

Cash and cash equivalents at the end of the financial period 578,093 94,690



20

NOTES TO THE FINANCIAL STATEMENTS FOR THE SIX MONTHS FINANCIAL PERIOD ENDED 28 FEBRUARY 2018 1. THE FUND, THE PRS PROVIDER AND ITS PRINCIPAL ACTIVITY

CIMB Islamic PRS Plus Growth (the “Fund”) is governed by a Deed dated 8 November 2012, a First Supplemental Deed dated 2 January 2014 and a Second Supplemental Deed dated 25 November 2014 (collectively referred to as the “Deeds”) made between CIMB-Principal Asset Management Berhad (the “PRS Provider”) and Deutsche Trustees Malaysia Berhad (the “Trustee”). The Fund offers three classes of units known respectively as Class A, Class C and Class X. In accordance with the Disclosure Document, Class A and Class C are for members who have attained the age of 18 years as of the date of opening a private pension account. Class A and C have different management fee. Class X is for members who participate via respective employers and is subject to a minimum of 200 participating employees per employer or 50 participating employees under payroll deduction per employer. The Fund will invest in a portfolio of mixed assets, primarily in Shariah-compliant equities with some exposure in Sukuk, to provide capital growth to the Fund. The investments by the Fund in Shariah-compliant equities which include foreign exposure shall not exceed 70% of the Fund’s NAV and investments in both local and foreign Sukuk shall not be less than 30% of its NAV with a minimum credit rating of “BBB3” or “P2” by RAM or equivalent rating by MARC or “BBB” by S&P or equivalent rating by Moody’s or Fitch. The fixed income portion will provide capital stability to the Fund whilst the equity portion will provide the added return in a rising market. The Fund may opt to invest in Sukuk and Shariah-compliant equities either directly or via Shariah-compliant collective investment schemes. All investments are subjected to the SC Guidelines on PRS, 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 PRS Provider, 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 PRS Provider is also an associate of Principal International (Asia) Limited, which is a subsidiary of Principal Financial Group Inc. The principal activities of the PRS Provider 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 International Financial Reporting Standards (“IFRS”). The financial statements have been prepared under the historical cost convention, as modified by financial assets at fair value through profit or loss. 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 period.


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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (a) Basis of preparation (continued)

It also requires the PRS Provider to exercise their judgment in the process of applying the Fund’s accounting policies. Although these estimates and judgment are based on the PRS Provider’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(l). 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 September 2017:

Amendments to MFRS 107 “Statement of Cash Flows - Disclosure Initiative” introduce an additional disclosure on changes in liabilities arising from financing activities.

The adoption of these amendments did not have any impact on the current financial period or any prior financial period and is not likely to affect future periods. 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 September 2018

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 other comprehensive income (“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.

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.


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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (a) Basis of preparation (continued)

(i) Financial year beginning on/after 1 September 2018 (continued)

MFRS 9 introduces an expected credit loss (“ECL”) 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 has reviewed its financial assets and liabilities and has assessed the following impact from the adoption of the new standard on 1 January 2018: There will be no impact on the Fund's accounting for financial assets as the Fund's equity investments currently measured at fair value through profit or loss will continue to be measured on the same basis under MFRS 9. There will be no impact on the Fund's accounting for financial liabilities as the new requirements only affect the accounting for financial liabilities that are designated at fair value through profit or loss and the Fund does not have any such liabilities. The new impairment model requires the recognition of impairment provisions based on ECL rather than only incurred credit losses as is the case under MFRS 139. It applies to financial assets classified at amortised cost. Based on the assessments undertaken to date, the Fund does not expect any loss allowance to be recognised upon adoption of MFRS 9.

(b) Financial assets and financial liabilities

Classification

The Fund designates its investments in Shariah-compliant collective investment schemes, Shariah-compliant quoted securities and unquoted Sukuk 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 are 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 the PRS Provider, amount due from stockbrokers 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 the PRS Provider, and other payables and accruals as other financial liabilities.


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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (b) Financial assets and financial liabilities (continued)

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 period 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 schemes are valued based on the most recent published NAV per unit or share of such Shariah-compliant collective investment schemes or, if unavailable, on the last published price of such unit or share (excluding any sales charge included in such selling price). Shariah-compliant quoted securities in Malaysia are valued at the last traded 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 PRS Provider, based on the methods or bases approved by the Trustee after appropriate technical consultation. Unquoted Sukuk denominated in Ringgit Malaysia (“RM”) are revalued on a daily basis based on fair value prices quoted by a Bond Pricing Agency (“BPA”) registered with the SC as per the SC Guidelines on PRS. Refer to Note 2(l) for further explanation.


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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (b) Financial assets and financial liabilities (continued)

Recognition and measurement (continued) Shariah-compliant deposits with licensed Islamic financial institutions are stated at cost plus accrued profit calculated on the effective profit method over the period from the date of placement to the date of maturity of the respective Shariah-compliant 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 period 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 period, 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

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(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 and unquoted Sukuk are 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 schemes

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

Realised gain or loss on disposal of unquoted Sukuk is accounted for as the difference between the net disposal proceeds and the carrying amount of unquoted Sukuk, determined on cost adjusted for accretion of discount or amortisation of premium.

(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 RM, which is the Fund’s functional and presentation currency. Due to mixed factors in determining the functional currency of the Fund, the PRS Provider has used its judgement to determine the functional currency that most faithfully represents the economic effects of the underlying transactions, events and conditions and have determined the functional currency to be in RM primarily due to the following factors: i) The Fund's units are denominated in RM; ii) Significant portion of the Fund’s expenses are denominated in RM; and iii) Significant portion of the cash is denominated in RM for the purpose of making

settlement of foreign trades.

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 period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in statement of comprehensive income.


26


(e) Creation and cancellation of units The members’ contributions to the Fund meet the definition of puttable instruments classified as financial liability under MFRS 132 “Financial Instruments: Presentation”. The Fund issues cancellable units, in three classes of units, known respectively as the Class A, Class C and Class X, which are cancelled at the member’s option and do not have identical features subject to restrictions as stipulated in the Disclosure Document and SC Guidelines on PRS. The units are classified as financial liabilities. Cancellable units can be put back to the Fund at any time for cash equal to a proportionate share of the Fund’s NAV of respective classes. The outstanding units are carried at the redemption amount that is payable at the date of statement of financial position if the member exercises the right to put back the unit to the Fund. Units are created and cancelled at the member’s option at prices based on the Fund’s NAV per unit of respective classes at the close of business on the relevant dealing day. The Fund’s NAV per unit of respective classes is calculated by dividing the net assets attributable to members of respective classes with the total number of outstanding units of respective classes.

(f) 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 subjected to an insignificant risk of changes in value.

(g) Taxation

Current tax expense is determined according to Malaysian tax laws at the current rate based upon the taxable profit earned during the financial period. 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.

(h) Increase/Decrease in net assets attributable to members

Income not distributed is included in net assets attributable to members.

(i) 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.

(j) 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.


27


(k) Amount due from/to stockbrokers

Amount due from and amount due to stockbrokers represent receivables for investments sold and payables for investments 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 interest 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 stockbrokers. Significant financial difficulties of the stockbrokers, probability that the brokers 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 interest used to discount the future cash flows for the purpose of measuring the impairment loss.

(l) 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 Funds’ results and financial position are tested for sensitivity to changes in the underlying parameters. Estimates and judgment are continually evaluated by the PRS Provider and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Estimate of fair value of unquoted Sukuk In undertaking any of the Fund’s investments, the PRS Provider 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 PRS. Ringgit-denominated unquoted Sukuk are valued using fair value prices quoted by a BPA. Where the PRS Provider is of the view that the price quoted by BPA for a specific unquoted fixed income securities differs from the market price by more than 20 bps, the PRS Provider may use market price, provided that the PRS Provider records its basis for using a non-BPA price, obtains necessary internal approvals to use the non-BPA price, and keeps an audit trail of all decisions and basis for adopting the use of non-BPA price.


28

3. RISK MANAGEMENT OBJECTIVES AND POLICIES

The investment objective of the Fund is to provide capital growth over the long-term by investing in a portfolio of primarily Shariah-compliant equities with some exposure in Sukuk. 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 PRS Provider and adherence to the investment restrictions as stipulated in the Deeds and SC Guidelines on PRS. (a) Market risk

(i) Price risk This is the risk that the fair value of an investment in Shariah-compliant collective investment schemes, Shariah-compliant quoted securities and unquoted Sukuk will fluctuate because of changes in market prices. The value of investments in Shariah-compliant collective investment schemes, Shariah-compliant quoted securities and unquoted Sukuk 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 schemes, Shariah-compliant quoted securities, unquoted Sukuk and other financial instruments within specified limits according to the Deeds.

(ii) Interest rate risk In general, when profit rates rise, unquoted Sukuk prices will tend to fall and vice versa. Therefore, the NAV of the Fund may also tend to fall when profit rates rise or are expected to rise. However, investors should be aware that should the Fund holds an unquoted Sukuk till maturity, such price fluctuations would dissipate as it approaches maturity, and thus the growth of the NAV shall not be affected at maturity. In order to mitigate profit rates exposure of the Fund, the PRS Provider will manage the duration of the portfolio via shorter or longer tenured assets depending on the view of the future profit rate trend of the PRS Provider, which is based on its continuous fundamental research and analysis. Investors should note that the movement in prices of unquoted Sukuk and Shariah-compliant money market instruments are benchmarked against profit rates. As such, the investments are exposed to the movement of the profit rates. However, it does not in any way suggest that the Fund will invest in conventional financial instruments. All investments carried out for the Fund, including placements and deposits are in accordance with Shariah. This risk is crucial since unquoted Sukuk portfolio management depends on forecasting profit rate movements. Prices of unquoted Sukuk move inversely to profit rate movements, therefore as profit rates rise, the prices of unquoted Sukuk decrease and vice versa. Furthermore, unquoted Sukuk with longer maturity and lower yield profit rates are more susceptible to profit rate movements.


29

3. RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)

(a) Market risk (continued)

(ii) Interest rate risk (continued) Such investments may be subject to unanticipated rise in profit rates which may impair the ability of the issuers to meet the obligation under the instrument, especially if the issuers are highly leveraged. An increase in profit rates may therefore increase the potential for default by an issuer.

(iii) Currency risk

Currency risk of the Fund 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 PRS Provider will evaluate the likely directions of a foreign currency versus RM based on considerations of economic fundamentals such as profit rate differentials, balance of payments position, debt levels, and technical chart considerations.

(b) Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligation resulting in financial loss to the Fund. Investment in unquoted Sukuk may involve a certain degree of credit/default risk with regards to the issuers. Generally, credit risk or default risk is the risk of loss due to the issuer’s non-payment or untimely payment of the investment amount as well as the returns on investment. This will cause a decline in value of the defaulted unquoted Sukuk and subsequently depress the NAV of the Fund. Usually credit risk is more apparent for an investment with a longer tenure, i.e. the longer the duration, the higher the credit risk. Credit risk can be managed by performing continuous fundamental credit research and analysis to ascertain the creditworthiness of its issuer. In addition, the PRS Provider imposes a minimum rating requirement as rated by either local and/or foreign rating agencies and manages the duration of the investment in accordance with the objective of the Fund. For this Fund, the unquoted Sukuk investments must satisfy a minimum rating requirement of at least “BBB3” or “P2” by RAM or equivalent rating by MARC or “BBB” by S&P or equivalent rating by Moody’s or Fitch.

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 the PRS Provider, the settlement terms of the proceeds from the creation of units receivable from the PRS Provider are governed by the SC Guidelines on PRS. 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-compliant quoted securities are settled/paid upon delivery using approved stockbrokers.


30


(c) Liquidity risk Liquidity risk is the risk that the Fund will encounter difficulty in meeting its financial obligations. The PRS Provider 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 PRS Provider 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.

(d) Capital risk management

The capital of the Fund is represented by equity consisting of net assets attributable to members of RM49,740,652 (31.08.2017: RM42,090,581). 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 members. 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 members and benefits for other stakeholders and to maintain a strong capital base to support the development of the investment activities of the Fund.

(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 values 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 period 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 PRS Provider 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 on-going basis. The fair value of financial assets that are not traded in an active market is determined by using valuation techniques.


31


(e) Fair value estimation (continued)

(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.

Level 1 Level 2 Level 3 Total RM RM RM RM 28.02.2018 Financial assets at fair value through profit or loss: - Shariah- compliant quoted securities 32,963,869 - - 32,963,869 - Unquoted Sukuk - 15,903,154 - 15,903,154

32,963,869 15,903,154 - 48,867,023


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(e) Fair value estimation (continued) (i) Fair value hierarchy (continued)

Level 1 Level 2 Level 3 Total

RM RM RM RM

31.08.2017

Audited Financial assets at fair value through profit or loss:

- Shariah-

compliant collective investment schemes 41,618,816 - -

41,618,816

Shariah-compliant investments whose values are based on quoted market prices in active markets, and are therefore classified within Level 1, include active listed equities. 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).

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. This includes unquoted Sukuk. As Level 2 instruments include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information. The Fund’s policies on valuation of these financial assets are stated in Note 2(b).

(ii) The carrying values of cash and cash equivalents, amount due from

stockbrokers, amount due from the PRS Provider, dividends receivable and all current liabilities are a reasonable approximation of their fair values due to their short-term nature.


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4. MANAGEMENT FEE AND PRIVATE PENSION ADMINISTRATOR’S FEE

In accordance with the Deeds, the PRS Provider is entitled to a maximum management fee of 3.00% per annum for each unit class, calculated daily based on the NAV of the Fund.

For the six months financial period ended 28 February 2018 and 28 February 2017, the management fee for the respective classes is recognised at the following rates:

Class A Class C Class X

1.40% 1.50% 1.40%

Nonetheless, no management fee is charged on the Fund for the financial period as the management fee has been waived by the PRS Provider. The Private Pension Administrator’s fee is recognised at a rate of 0.04% per annum (28.02.2017: 0.04% per annum) for each unit class, calculated daily based on the NAV of the Fund. There will be no further liability in respect of management fee, and Private Pension Administrator’s fee other than the amount recognised above.

5. TRUSTEE’S AND CUSTODIAN FEES

In accordance with the Deeds, the Trustee is entitled to a maximum fee of 0.04% per annum for each unit class calculated daily based on the NAV of the Fund. The Trustee's fee includes local custodian fee but excludes foreign sub-custodian fees. The foreign sub-custodian fee is dependent on the country invested and is charged monthly in areas. For the six months financial period ended 28 February 2018, the Trustee’s fee is recognised at a rate of 0.04% per annum (28.02.2017: 0.04% per annum).

There will be no further liability to the Trustee in respect of Trustee’s fee other than the amount recognised above.

6. PROFIT INCOME

01.09.2017

to 28.02.2018 01.09.2016

to 28.02.2017

RM RM Profit income from Shariah-compliant deposits with licensed Islamic financial institutions 4,708 -

Profit income from unquoted Sukuk 198,216 -

202,924 -


34

7. TAXATION

01.09.2017

to 28.02.2018 01.09.2016

to 28.02.2017

RM RM

Tax charged for the financial period:

- Withholding tax 6,612 -

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

01.09.2017 to 28.02.2018

01.09.2016 to 28.02.2017

RM

RM

Profit before taxation 800,628

880,458

Taxation at Malaysian statutory rate of 24% (28.02.2017: 24%) 192,151

211,310

Tax effects of: Investment income not subject to tax (230,679)

(217,673)

Expenses not deductible for tax purposes 33,508

4,925 Restriction on tax deductible expenses for PRS Funds 5,020 1,438

Investment income subject to withholding tax 6,612 -

Taxation 6,612

-

8. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

28.02.2018 31.08.2017

Audited

RM RM Designated at fair value through profit or loss at inception: - Shariah-compliant quoted securities 32,963,869 - - Unquoted Sukuk 15,903,154 -

- Shariah-compliant collective investment schemes - 41,618,816

48,867,023 41,618,816

01.09.2017

to 28.02.2018 01.09.2016

to 28.02.2017 RM RM Net gain on financial assets at fair value through profit or loss: - Realised gain on disposals 3,002,598 622,244 - Unrealised fair value (loss)/gain (2,396,879) 156,420

605,719 778,664


35

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

Name of counter Quantity Aggregate

cost Market

value Percentage

of NAV

Units RM RM %

28.02.2018 SHARIAH-COMPLIANT QUOTED SECURITIES - LOCAL

Construction

Gamuda Bhd 66,800 332,079 331,328 0.67

IJM Corporation Bhd 121,600 364,731 330,752 0.66

MGB Bhd 193,000 305,423 328,100 0.66 Muhibbah Engineering (M) Bhd 76,700 230,238 237,770 0.48

Pintaras Jaya Bhd 22,200 88,790 75,702 0.15 Sunway Construction Group Bhd 93,800 245,283 225,120 0.45

574,100 1,566,544 1,528,772 3.07

Finance

BIMB Holdings Bhd 58,300 243,595 244,860 0.49

Industrials

Petronas Chemicals Group

Bhd 62,000 453,887 501,580 1.01

SKP Resources Bhd 140,000 270,942 266,000 0.53

Top Glove Corporation Bhd 27,600 242,019 267,996 0.54

V.S. Industry Bhd 78,700 242,894 232,952 0.47

308,300 1,209,742 1,268,528 2.55

IPC

Lingkaran Trans Kota

Holdings Bhd 19,400 112,520 113,490 0.23

TIME dotCom Bhd 23,800 225,220 198,730 0.40

43,200 337,740 312,220 0.63

Plantation

Felda Global Ventures

Holdings Bhd 239,000 487,775 463,660 0.93

IOI Corporation Bhd 20,000 90,000 93,800 0.19

Kuala Lumpur Kepong Bhd 4,500 111,256 112,680 0.23

Sime Darby Plantation Bhd 74,500 416,455 398,575 0.80

338,000 1,105,486 1,068,715 2.15


36



cost Market

value Percentage

of NAV

Units RM RM %

28.02.2018 (CONTINUED) SHARIAH-COMPLIANT QUOTED SECURITIES - LOCAL (CONTINUED)

Properties

S P Setia Bhd - Preference

Share 20,200 17,776 17,776 0.04

Technology

Inari Amertron Bhd 158,200 455,415 534,716 1.08

Pentamaster Corporation Bhd 45,600 121,291 114,000 0.23

203,800 576,706 648,716 1.31

Trading/Services

Axiata Group Bhd 91,400 496,684 493,560 0.99

Bermaz Auto Bhd 162,900 346,372 346,977 0.70

Dialog Group Bhd 103,600 226,255 274,540 0.55

IHH Healthcare Bhd 81,500 496,639 481,665 0.97

MISC Bhd 67,600 503,494 463,736 0.93

My E.G. Services Bhd 96,900 224,377 260,661 0.52

Sime Darby Bhd 148,000 326,000 408,480 0.82

Sunway Bhd 152,600 256,380 251,790 0.51

Tasco Bhd 95,300 224,259 181,070 0.36

Telekom Malaysia Bhd 44,300 272,776 261,370 0.53

Tenaga Nasional Bhd 45,700 680,081 717,490 1.44

Westports Holdings Bhd 136,100 500,862 500,848 1.01

Yinson Holdings Bhd 57,100 241,986 242,675 0.49

1,283,000 4,796,165 4,884,862 9.82

TOTAL SHARIAH- COMPLIANT QUOTED SECURITIES - LOCAL 2,828,900 9,853,754 9,974,449 20.06


37



cost Market

value Percentage

of NAV

Units RM RM %

28.02.2018 (CONTINUED) SHARIAH-COMPLIANT QUOTED SECURITIES - FOREIGN

AUSTRALIA

Basic Materials BHP Billiton Ltd 7,356

717,206

686,446

1.38

TOTAL AUSTRALIA 7,356

717,206

686,446

1.38

CAYMAN ISLANDS

Consumer Products Alibaba Group Holding Ltd 2,599

1,983,599

1,893,990

3.81

TOTAL CAYMAN ISLANDS 2,599

1,983,599

1,893,990

3.81

HONG KONG

Basic Materials Anhui Conch Cement Co

Ltd 48,500

853,351

1,017,694

2.05

Consumer Products Brilliance China

Automotive Holdings Ltd 82,000

881,473

865,446

1.74 China Mengniu Dairy Co Ltd 87,000

992,637

1,124,925

2.26

MTR Corp Ltd 56,000

1,360,121

1,162,465

2.34 Techtronic Industries Co Ltd 41,000

1,011,055

1,006,953

2.02

Tingyi (Cayman Islands) Holding Corp 64,000

489,785

526,290

1.06

330,000

4,735,071

4,686,079

9.42

Energy China Petroleum &

Chemical Corp 316,000

967,966

995,798

2.00

CNOOC Ltd 198,000

1,156,873

1,129,051

2.27

514,000

2,124,839

2,124,849

4.27


38



cost Market

value Percentage

of NAV

Units RM RM %

28.02.2018 (CONTINUED) SHARIAH-COMPLIANT QUOTED SECURITIES - FOREIGN (CONTINUED)

HONG KONG (CONTINUED)

Finance China Resources Land

Ltd 68,000

879,036

950,680

1.91

China Vanke Co Ltd - H1 49,000

746,828

861,519

1.73 Henderson Land Development Co Ltd 41,000

1,163,977

1,045,918

2.10

158,000

2,789,841

2,858,117

5.74

REITs Link REIT 31,000

1,101,935

1,037,365

2.09

Technology Sunny Optical Technology

Group Co Ltd 14,000

902,975

915,266

1.84

Tencent Holdings Ltd 10,900

2,209,788

2,356,432

4.74

24,900

3,112,763

3,271,698

6.58

TOTAL HONG KONG 1,106,400

14,717,800

14,995,802

30.15

INDONESIA

Telecommunications Telekomunikasi Indonesia

Persero Tbk PT 517,400

677,643

589,008

1.18

TOTAL INDONESIA 517,400

677,643

589,008

1.18

SINGAPORE

Energy Keppel Corp Ltd 47,600

1,125,111

1,129,720

2.27

REITs CapitaLand Commercial

Trust 208,500

1,164,240

1,067,435

2.15

CapitaLand Mall Trust 181,600

1,140,633

1,085,567

2.18

390,100

2,304,873

2,153,002

4.33


39



cost Market

value Percentage

of NAV

Units RM RM %

28.02.2018 (CONTINUED) SHARIAH-COMPLIANT QUOTED SECURITIES - FOREIGN (CONTINUED)

SINGAPORE (CONTINUED)

Technology Venture Corp Ltd 18,900

1,126,660

1,541,452

3.10

TOTAL SINGAPORE 456,600

4,556,644

4,824,174

9.70

TOTAL SHARIAH- COMPLIANT QUOTED SECURITIES - FOREIGN 2,090,355

22,652,892

22,989,420

46.22

TOTAL SHARIAH- COMPLIANT QUOTED SECURITIES 4,919,255

32,506,646

32,963,869

66.28

ACCUMULATED UNREALISED GAIN ON SHARIAH-COMPLIANT QUOTED SECURITIES AT FAIR VALUE THROUGH PROFIT OR LOSS

457,223

TOTAL SHARIAH- COMPLIANT QUOTED SECURITIES AT FAIR VALUE THROUGH PROFIT OR LOSS

32,963,869


40


Name of issuer Nominal

value Aggregate

cost Market

value Percentage

of NAV

RM RM RM %

28.02.2018 (CONTINUED)

UNQUOTED SUKUK

Bandar Serai Development Sdn Bhd 4.78% 27/10/2020 (AA3) 2,500,000

2,564,061

2,553,775

5.13

Bank Pembangunan Malaysia Bhd 4.28% 02/03/2022 (AAA) 1,800,000

1,829,290

1,825,561

3.67

Celcom Transmission (M) Sdn Bhd 4.85% 29/08/2022 (AA1) 500,000

502,478

503,116

1.01

Imtiaz Sukuk II Bhd 4.58% 27/05/2022 (AA2) 1,250,000

1,265,942

1,264,780

2.54

Jimah Energy Ventures Sdn Bhd 9.15% 05/12/2020 (AA3) 1,250,000

1,409,765

1,410,373

2.84

Jimah Energy Ventures Sdn Bhd 9.35% 12/05/2020 (AA3) 1,250,000

1,415,583

1,416,302

2.85

MMC Corporation Bhd 5.64% 27/04/2027 (AA3) 2,000,000

2,082,894

2,079,170

4.18

Telekom Malaysia Bhd 4.20% 13/09/2021 (AAA) 1,000,000

1,021,696

1,019,857

2.05

UEM Edgenta Bhd 4.85% 26/04/2022 (AA3) 400,000

409,676

409,213

0.82

UniTapah Sdn Bhd 5.01% 12/06/2019 (AA1) 900,000

918,997

919,290

1.85

United Growth Bhd 4.73% 21/06/2022 (AA2) 450,000

457,948

457,925

0.92

WCT Holdings Bhd 4.80% 28/12/2018 (AA3) 200,000

202,050

202,156

0.41

WCT Holdings Bhd 5.32% 11/05/2022 (AA3) 1,800,000

1,841,937

1,841,636

3.70

TOTAL UNQUOTED SUKUK 15,300,000

15,922,317

15,903,154

31.97

ACCUMULATED UNREALISED LOSS ON UNQUOTED SUKUK AT FAIR VALUE THROUGH PROFIT OR LOSS

(19,163)

TOTAL UNQUOTED SUKUK AT FAIR VALUE THROUGH PROFIT OR LOSS

15,903,154


41


Name of counter Quantity

Aggregate Cost

Market Value

Percentage of NAV

Units

RM

RM

%

31.08.2017 Audited SHARIAH-COMPLIANT

COLLECTIVE INVESTMENT SCHEMES

CIMB Islamic Al Azzam Equity Fund

31,595,935

8,881,611

9,339,758

22.19

CIMB Islamic Asia Pacific Equity Fund

9,962,337

6,999,225

8,513,813

20.23

CIMB Islamic Dali Asia Pacific Equity Growth Fund 6,377,127

5,403,863

6,270,629

14.90

CIMB Islamic Enhanced Sukuk Fund

5,726,633

5,969,466

5,885,261

13.98

CIMB Islamic Equity Aggressive Fund

4,975,398

3,716,000

3,907,677

9.28

CIMB Islamic Sukuk Fund 5,982,815

7,813,712

7,701,678

18.30

TOTAL SHARIAH- COMPLIANT COLLECTIVE INVESTMENT SCHEMES 64,620,245

38,783,877

41,618,816

98.88

ACCUMULATED UNREALISED GAIN ON SHARIAH-COMPLIANT COLLECTIVE INVESTMENT SCHEMES AT FAIR VALUE THROUGH PROFIT OR LOSS

2,834,939

TOTAL SHARIAH-

COMPLIANT COLLECTIVE INVESTMENT SCHEMES AT FAIR VALUE THROUGH PROFIT OR LOSS

41,618,816

1 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 Stock exchange.


42

9. CASH AND CASH EQUIVALENTS

28.02.2018

31.08.2017

Audited

RM

RM

Shariah-compliant deposits with licensed Islamic financial institutions 470,041

-

Bank balances 108,052

75,169

578,093

75,169

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

28.02.2018 31.08.2017

Audited

% % Shariah-compliant deposits with licensed Islamic financial institutions 3.20 -

Shariah-compliant deposits with licensed Islamic financial institutions of the Fund have an average maturity of 1 day (31.08.2017: Nil).

10. AMOUNT DUE FROM/TO THE PRS PROVIDER

28.02.2018 31.08.2017

Audited

RM RM

Amount due from the PRS Provider:

- Creation of units 630,885 488,319

Amount due to the PRS Provider:

- Cancellation of units 19,626 54,014 - Purchase of Shariah-compliant collective investment schemes - 20,000

19,626 74,014

11. NUMBER OF UNITS IN CIRCULATION (UNITS)

01.09.2017 to 28.02.2018

01.09.2016 to 31.08.2017

Audited

No. of units

No. of units

Class A (i) 34,000,169

28,990,175

Class C (ii) 2,883,743

2,520,426

Class X (iiii) 36,145,619

31,449,076

73,029,531

62,959,677


43

11. NUMBER OF UNITS IN CIRCULATION (UNITS) (CONTINUED)

(i) Class A

01.09.2017

to 28.02.2018 01.09.2016

to 31.08.2017

Audited

No. of units No. of units

At the beginning of the financial period/year 28,990,175 21,685,144

Add: Creation of units from applications 6,011,634 8,908,865

Less: Cancellation of units (1,001,640) (1,603,834)

At the end of the financial period/year 34,000,169 28,990,175

(ii) Class C

01.09.2017

to 28.02.2018 01.09.2016

to 31.08.2017

Audited



Add: Creation of units from applications 444,618 924,624

Less: Cancellation of units (81,301) (160,609)


(iii) Class X

01.09.2017

to 28.02.2018 01.09.2016

to 31.08.2017

Audited



Add: Creation of units from applications 6,102,178 11,663,431

Less: Cancellation of units (1,405,635) (2,079,156)



44

12. MANAGEMENT EXPENSE RATIO (“MER”)

01.09.2017

to 28.02.2018 01.09.2016

to 28.02.2017

% %

MER 0.12 0.08

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

A = Private Pension Administrator’s fee B = Trustee’s and custodian fees C = Audit fee D = Tax agent’s fee E = Other expenses F = Average NAV of the Fund calculated on a daily basis The average NAV of the Fund for the financial period calculated on a daily basis is RM45,989,541 (28.02.2017: RM29,944,979).

13. PORTFOLIO TURNOVER RATIO (“PTR”)

01.09.2017

to 28.02.2018 01.09.2016

to 28.02.2017

PTR (times) 1.29 0.50

PTR is derived based on the following calculation:

(Total acquisition for the financial period + total disposal for the financial period) 2 Average NAV of the Fund for the financial period calculated on a daily basis where: total acquisition for the financial period = RM62,680,033 (28.02.2017: RM17,562,000)

total disposal for the financial period = RM56,430,600 (28.02.2017: RM12,110,000)


45

14. UNITS HELD BY THE PRS PROVIDER AND PARTIES RELATED TO THE PRS PROVIDER, AND SIGNIFICANT RELATED PARTIES TRANSACTIONS AND BALANCES The related parties and their relationship with the Fund are as follows: Related parties

Relationship

CIMB-Principal Asset Management Bhd

The PRS Provider

CIMB Group Sdn Bhd

Holding company of the PRS Provider

CIMB Group Holdings Bhd (“CIMB”)

Ultimate holding company of the PRS Provider

CIMB Investment Bank Bhd Fellow related party to the PRS Provider

CIMB Securities (Singapore) Pte Ltd Fellow related party to the PRS Provider

CIMB Bank Bhd Fellow related party to the PRS Provider

Subsidiaries and associates of CIMB as disclosed in its financial statements

Subsidiary and associated companies of the ultimate holding company of the PRS Provider

Units held by the PRS Provider and parties related to the PRS Provider There were no units held by the PRS Provider, Directors or parties related to the PRS Provider as at the end of each financial period/year.

In addition to related party disclosures mentioned elsewhere in the financial statements, set out below are other significant related party transactions and balances. The PRS Provider 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.

01.09.2017

to 28.02.2018 01.09.2016

to 28.02.2017

RM RM

Significant related party transactions Dividend income from Shariah-compliant collective

investment schemes managed by the PRS Provider 128,343 128,307

Purchase of Shariah-compliant collective investment

schemes:

- CIMB-Principal Asset Management Bhd 1,958,343 17,562,000

Disposal of Shariah-compliant collective investment

schemes:

- CIMB-Principal Asset Management Bhd 40,742,220 12,110,000


46

14. UNITS HELD BY THE PRS PROVIDER AND PARTIES RELATED TO THE PRS PROVIDER, AND SIGNIFICANT RELATED PARTIES TRANSACTIONS AND BALANCES (CONTINUED)

28.02.2018 31.08.2017

Audited

RM RM

Significant related party balances Shariah-compliant collective investment schemes

managed by the PRS Provider:

- CIMB Islamic Al Azzam Equity Fund - 9,339,758

- CIMB Islamic Asia Pacific Equity Fund - 8,513,813

- CIMB Islamic Dali Asia Pacific Equity Growth Fund - 6,270,629

- CIMB Islamic Enhanced Sukuk Fund - 5,885,261

- CIMB Islamic Equity Aggressive Fund - 3,907,677

- CIMB Islamic Sukuk Fund - 7,701,678

- 41,618,816

15. TRANSACTIONS WITH BROKERS/DEALERS

Details of transactions with the brokers/dealers for the six months financial period ended 28 February 2018 are as follows:

Brokers/Dealers Value of

trades

Percentage of total trades

Brokerage fees

Percentage of total

brokerage fees

RM % RM % CIMB-Principal Asset Management Bhd # 46,339,982 38.90 - - Citigroup Global Markets Ltd 18,742,342 15.74 5,623 9.67

RHB Investment Bank Bhd 10,739,203 9.02 1,891 3.25

RHB Bank Bhd 8,678,930 7.29 - -

Hong Leong Bank Bhd 6,319,150 5.31 - - Maybank Investment Bank Bhd 4,369,282 3.67 9,831 16.91 Affin Hwang Investment Bank Bhd 3,421,751 2.87 7,699 13.24 Credit Suisse Securities (Malaysia) Sdn Bhd 2,780,662 2.33 6,257 10.76 CIMB Investment Bank Bhd # 1,659,047 1.39 3,444 5.92 Hong Leong Investment Bank Bhd 1,630,761 1.37 1,170 2.01

Others # 14,429,522 12.11 22,214 38.24

119,110,632 100.00 58,129 100.00


47

15. TRANSACTIONS WITH BROKERS/DEALERS (CONTINUED) Details of transactions with the brokers/dealers for the six months financial period ended 28 February 2017 are as follows:

Brokers/Dealers Value of

trades

Percentage of total trades

Brokerage fees

Percentage of total

brokerage fees

RM % RM % CIMB-Principal Asset Management Bhd # 29,672,000 100.00 - -

# Included in transactions are trades conducted with CIMB-Principal Asset Management

Bhd, the PRS Provider of the Fund, amounting to RM46,339,982 (28.02.2017: RM29,672,000), CIMB Investment Bank Bhd, CIMB Securities (Singapore) Pte Ltd and CIMB Bank Bhd, fellow related parties to the PRS Provider amounting to RM1,659,047 (28.02.2017: Nil), RM1,068,239 (28.02.2017: Nil) and RM303,270 (28.02.2017: Nil). The PRS Provider is of the opinion that all transactions have been entered into in the normal course of business at agreed terms between the related parties.

16. 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 provide capital growth over the long-term by investing in a portfolio of primarily Shariah-compliant equities with some exposure in Sukuk. 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, Malaysia domiciled Shariah-compliant collective investment schemes, Shariah-compliant quoted securities listed on the Bursa Securities, Malaysia, Shariah-compliant quoted securities of companies domilied in, listed in, and/or have significant operations in countries in Asia Pacific ex Japan and unquoted Sukuk traded in Malaysia.

There were no changes in reportable operating segment during the financial period.


48

DIRECTORY Head office of the PRS Provider 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 http://www.cimb-principal.com.my/ E-mail address [email protected] General investment enquiries (03) 7718 3100 Trustee for the CIMB Islamic PRS Plus Growth Deutsche Trustees Malaysia Berhad (Company No.: 763590-H) Level 20 Menara IMC, 8 Jalan Sultan Ismail, 50250 Kuala Lumpur, MALAYSIA. Tel: (03) 2053 7522 Fax: (03) 2053 7526 Shariah Adviser of the CIMB Islamic PRS Plus Growth 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

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

mailto:[email protected]

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