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ANNUAL REPORT

For the Financial Period from 1 July 2015 (date of commencement) to 31 August 2016

KENANGA ASEAN TACTICAL TOTAL RETURN FUND

KENANGA ASEAN TACTICAL TOTAL RETURN FUND Contents Page

Corporate Directory ii

Directory of Manager’s Offices iii

Fund Information 1

Manager’s Report 2-6

Fund Performance 7-9

Trustee’s Report 10

Independent Auditors’ Report 11-12

Statement by the Manager 13

Financial Statements 14-43

ii Kenanga ASEAN Tactical Total Return Fund Annual Report

Kenanga ASEAN Tactical Total Return Fund Annual Report ii

CORPORATE DIRECTORY Manager: Kenanga Investors Berhad (Company No. 353563-P) Registered Office Kenanga Investors Berhad (KIB) 8th Floor, Kenanga International, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia. Tel: 03-2162 1490 Fax: 03-2161 4990

Business Office Suite 12.02, 12th Floor, Kenanga International, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia. Tel: 03-2057 3688 Fax: 03-2161 8807 E-mail:[email protected] Website: www.KenangaInvestors.com.my

Board Of Directors Datuk Syed Ahmad Alwee Alsree (Chairman) Syed Zafilen Syed Alwee (Independent Director)Peter John Rayner (Independent Director) Imran Devindran bin Abdullah (Independent

Director) Dato’ Bruce Kho Yaw Huat Ismitz Matthew De Alwis

Investment Committee Dato’ Bruce Kho Yaw Huat (Chairman) Syed Zafilen Syed Alwee (Independent

Member) Peter John Rayner (Independent Member) Imran Devindran bin Abdullah (Independent

Member) Ismitz Matthew De Alwis

Company Secretary: Norliza Abd Samad (MAICSA 7011089) 9th Floor, Kenanga International, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia. Tel: 03-2162 1490 Fax:03-2161 4990 Trustee: CIMB Commerce Trustee Berhad (Company No. 313031-A) Registered Office Level 13, Menara CIMB Jalan Stesen Sentral 2 Kuala Lumpur Sentral 50490 Kuala Lumpur. Tel: 03-2261 8888 Fax: 03-2261 0099 Website: www.cimb.com

Business Office Level 21, Menara CIMB Jalan Stesen Sentral 2 Kuala Lumpur Sentral 50490 Kuala Lumpur. Tel: 03-2261 8888 Fax: 03-2261 9889

Auditor: Ernst & Young (AF: 0039) Level 23A, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, 50490 Kuala Lumpur. Tel: 03-7495 8000 Fax: 03-2095 5332 Tax Adviser: Ernst & Young Tax Consultants Sdn Bhd (Company No. 179793-K) Level 23A, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, 50490 Kuala Lumpur. Tel: 03-7495 8000 Fax: 03-2095 5332

Membership: Federation Of Investment Managers Malaysia (FIMM) 19-06-1, 6th Floor, Wisma Tune, 19, Lorong Dungun, Damansara Heights,50490 Kuala Lumpur, Malaysia. Tel: 03-2093 2600 Fax: 03-2093 2700 Website: www.fimm.com.my

Kenanga ASEAN Tactical Total Return Fund Annual Report iii

DIRECTORY OF MANAGER’S OFFICES Regional Branch Offices : Kuala Lumpur Suite 12.02, 12th Floor, Kenanga International Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia Tel: 03-2057 3688 Fax: 03-2161 8807

Johor Bahru Lot 11.03, 11th Floor, Menara MSC Cyberport No. 5, Jalan Bukit Meldrum 80300 Johor Bahru , Johor Tel: 07-223 7505 / 4798 Fax: 07-223 4802

Melaka No. 25-1, Jalan Kota Laksamana 2/17 Taman Kota Laksamana, Seksyen 2 75200 Melaka Tel: 06-281 8913 Fax: 06-281 4286

Kuching 1st Floor, No 71, Lot 7 Lot 10900, Jalan Tun Jugah 93350 Kuching, Sarawak Tel: 082-572 228 Fax: 082-572 229

Klang No. 12, Jalan Batai Laut 3, Taman Intan 41300 Klang, Selangor Darul Ehsan Tel: 03-3341 8818 / 03-3348 7889 Fax: 03-3341 8816

Kota Kinabalu A-03-11, 3rd Floor Block A, Warisan Square Jalan Tun Fuad Stephens 88000 Kota Kinabalu, Sabah Tel: 088-447 089 / 088-448 106 Fax: 088-447 039

Penang 5.04, 5th Floor, Menara Boustead Penang No. 39, Jalan Sultan Ahmad Shah 10050 Penang. Tel : 04-227 3788 / 04-210 6644 Fax : 04-226 5120

Ipoh Suite 1, 2nd Floor, No. 63, Persiaran Greenhill, 30450 Ipoh, Perak, Malaysia Tel: 05-254 7573 / 7570 / 7575 Fax: 05-254 7606

Seremban 2nd Floor, No. 1D-2, Jalan Tuanku Munawir 70000 Seremban, Negeri Sembilan Tel : 06-761 5678 Fax : 06-761 2243

Miri 2nd Floor, Lot 1264, Centre Point Commercial Centre, Jalan Melayu, 98000 Miri, Sarawak Tel: 085-416 866 Fax: 085-322 340


Kenanga ASEAN Tactical Total Return Fund Annual Report ii

CORPORATE DIRECTORY Manager: Kenanga Investors Berhad (Company No. 353563-P) Registered Office Kenanga Investors Berhad (KIB) 8th Floor, Kenanga International, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia. Tel: 03-2162 1490 Fax: 03-2161 4990

Business Office Suite 12.02, 12th Floor, Kenanga International, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia. Tel: 03-2057 3688 Fax: 03-2161 8807 E-mail:[email protected] Website: www.KenangaInvestors.com.my

Board Of Directors Datuk Syed Ahmad Alwee Alsree (Chairman) Syed Zafilen Syed Alwee (Independent Director)Peter John Rayner (Independent Director) Imran Devindran bin Abdullah (Independent

Director) Dato’ Bruce Kho Yaw Huat Ismitz Matthew De Alwis

Investment Committee Dato’ Bruce Kho Yaw Huat (Chairman) Syed Zafilen Syed Alwee (Independent

Member) Peter John Rayner (Independent Member) Imran Devindran bin Abdullah (Independent

Member) Ismitz Matthew De Alwis

Company Secretary: Norliza Abd Samad (MAICSA 7011089) 9th Floor, Kenanga International, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia. Tel: 03-2162 1490 Fax:03-2161 4990 Trustee: CIMB Commerce Trustee Berhad (Company No. 313031-A) Registered Office Level 13, Menara CIMB Jalan Stesen Sentral 2 Kuala Lumpur Sentral 50490 Kuala Lumpur. Tel: 03-2261 8888 Fax: 03-2261 0099 Website: www.cimb.com

Business Office Level 21, Menara CIMB Jalan Stesen Sentral 2 Kuala Lumpur Sentral 50490 Kuala Lumpur. Tel: 03-2261 8888 Fax: 03-2261 9889

Auditor: Ernst & Young (AF: 0039) Level 23A, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, 50490 Kuala Lumpur. Tel: 03-7495 8000 Fax: 03-2095 5332 Tax Adviser: Ernst & Young Tax Consultants Sdn Bhd (Company No. 179793-K) Level 23A, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, 50490 Kuala Lumpur. Tel: 03-7495 8000 Fax: 03-2095 5332

Membership: Federation Of Investment Managers Malaysia (FIMM) 19-06-1, 6th Floor, Wisma Tune, 19, Lorong Dungun, Damansara Heights,50490 Kuala Lumpur, Malaysia. Tel: 03-2093 2600 Fax: 03-2093 2700 Website: www.fimm.com.my


DIRECTORY OF MANAGER’S OFFICES Regional Branch Offices : Kuala Lumpur Suite 12.02, 12th Floor, Kenanga International Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia Tel: 03-2057 3688 Fax: 03-2161 8807

Johor Bahru Lot 11.03, 11th Floor, Menara MSC Cyberport No. 5, Jalan Bukit Meldrum 80300 Johor Bahru , Johor Tel: 07-223 7505 / 4798 Fax: 07-223 4802

Melaka No. 25-1, Jalan Kota Laksamana 2/17 Taman Kota Laksamana, Seksyen 2 75200 Melaka Tel: 06-281 8913 Fax: 06-281 4286

Kuching 1st Floor, No 71, Lot 7 Lot 10900, Jalan Tun Jugah 93350 Kuching, Sarawak Tel: 082-572 228 Fax: 082-572 229

Klang No. 12, Jalan Batai Laut 3, Taman Intan 41300 Klang, Selangor Darul Ehsan Tel: 03-3341 8818 / 03-3348 7889 Fax: 03-3341 8816

Kota Kinabalu A-03-11, 3rd Floor Block A, Warisan Square Jalan Tun Fuad Stephens 88000 Kota Kinabalu, Sabah Tel: 088-447 089 / 088-448 106 Fax: 088-447 039

Penang 5.04, 5th Floor, Menara Boustead Penang No. 39, Jalan Sultan Ahmad Shah 10050 Penang. Tel : 04-227 3788 / 04-210 6644 Fax : 04-226 5120

Ipoh Suite 1, 2nd Floor, No. 63, Persiaran Greenhill, 30450 Ipoh, Perak, Malaysia Tel: 05-254 7573 / 7570 / 7575 Fax: 05-254 7606

Seremban 2nd Floor, No. 1D-2, Jalan Tuanku Munawir 70000 Seremban, Negeri Sembilan Tel : 06-761 5678 Fax : 06-761 2243

Miri 2nd Floor, Lot 1264, Centre Point Commercial Centre, Jalan Melayu, 98000 Miri, Sarawak Tel: 085-416 866 Fax: 085-322 340

1 Kenanga ASEAN Tactical Total Return Fund Annual Report

Kenanga ASEAN Tactical Total Return Fund Annual Report 1

1. FUND INFORMATION 1.1 Fund Name

Kenanga ASEAN Tactical Total Return Fund (KATTRF or the Fund) 1.2 Fund Category / Type

Equity / Growth

1.3 Investment Objective The Fund aims to provide capital appreciation over the long term (over 5 years) by investing in equities and equity related securities of companies in the ASEAN region.

1.4 Investment Strategy The Fund seeks to achieve its investment objective by tactically allocating the portfolio during favourable market conditions in a diversified portfolio of equities and equity related securities* whilst in adverse market conditions to reallocate between 1% - 30% of the Fund’s NAV in deposits or money market instruments with the objective of achieving sustainable long-term positive returns. * “Equity related securities” refers to warrants, convertible loan stocks,

transferable subscription rights and depository receipts.

1.5 Duration The Fund was launched on 1 July 2015 and shall exist as long as it appears to the Manager and the Trustee that it is in the interests of the unitholders for it to continue.

1.6 Performance Benchmark 8% growth in NAV per annum (compounded) over 5 years.

1.7 Distribution Policy As the objective of the Fund is to provide capital appreciation, distribution of income, if any, will be incidental.

1.8 Breakdown of unit holdings of KATTRF as at 31 August 2016

Size of holdings No. of unitholders No. of units held 5,000 and below 181 417,974 5,001 - 10,000 62 504,852 10,001-50,000 83 2,240,893 50,001-500,000 19 3,220,808 500,001 and above 5 14,294,135 Total 350 20,678,662


2. MANAGER’S REPORT 2.1 Explanation on whether the Fund has achieved its investment objective.

For the financial period under review, the Fund increased 7.02% in net asset value (NAV) terms, but below its performance benchmark of 9.41% growth in NAV as such achieving its objective.

2.2 Comparison between the Fund’s performance and performance of the benchmark

Performance Chart Since Launch (01/07/2015– 31/08/2016)

Kenanga Asia Pacific Total Return Fund vs Benchmark.

Source: Novagni Analytics and Advisory Sdn Bhd 2.3 Investment strategies and policies employed during the financial period

under review

For the financial period under review, the Fund aimed to achieve its investment objective by investing in a diversified portfolio of equities and equity related securities of companies in the ASEAN region. The Fund adopted a bottom-up stock picking strategy notwithstanding where those companies were listed or whether those companies were represented in any market indices.

2.4 The Fund's asset allocation as at 31 August 2016

Asset 31 August 2016 Listed investment securities 86.4% Short term deposits and cash 13.6%

Reason for the differences in asset allocation The fund increased allocation to quoted investment securities and decreased allocation to cash in order to take advantage of opportunities in the market. Nevertheless, the fund continues to place emphasis on stock selection.



1. FUND INFORMATION 1.1 Fund Name

Kenanga ASEAN Tactical Total Return Fund (KATTRF or the Fund) 1.2 Fund Category / Type

Equity / Growth

1.3 Investment Objective The Fund aims to provide capital appreciation over the long term (over 5 years) by investing in equities and equity related securities of companies in the ASEAN region.

1.4 Investment Strategy The Fund seeks to achieve its investment objective by tactically allocating the portfolio during favourable market conditions in a diversified portfolio of equities and equity related securities* whilst in adverse market conditions to reallocate between 1% - 30% of the Fund’s NAV in deposits or money market instruments with the objective of achieving sustainable long-term positive returns. * “Equity related securities” refers to warrants, convertible loan stocks,

transferable subscription rights and depository receipts.

1.5 Duration The Fund was launched on 1 July 2015 and shall exist as long as it appears to the Manager and the Trustee that it is in the interests of the unitholders for it to continue.

1.6 Performance Benchmark 8% growth in NAV per annum (compounded) over 5 years.

1.7 Distribution Policy As the objective of the Fund is to provide capital appreciation, distribution of income, if any, will be incidental.

1.8 Breakdown of unit holdings of KATTRF as at 31 August 2016

Size of holdings No. of unitholders No. of units held 5,000 and below 181 417,974 5,001 - 10,000 62 504,852 10,001-50,000 83 2,240,893 50,001-500,000 19 3,220,808 500,001 and above 5 14,294,135 Total 350 20,678,662


2. MANAGER’S REPORT 2.1 Explanation on whether the Fund has achieved its investment objective.

For the financial period under review, the Fund increased 7.02% in net asset value (NAV) terms, but below its performance benchmark of 9.41% growth in NAV as such achieving its objective.

2.2 Comparison between the Fund’s performance and performance of the benchmark

Performance Chart Since Launch (01/07/2015– 31/08/2016)

Kenanga Asia Pacific Total Return Fund vs Benchmark.

Source: Novagni Analytics and Advisory Sdn Bhd 2.3 Investment strategies and policies employed during the financial period

under review

For the financial period under review, the Fund aimed to achieve its investment objective by investing in a diversified portfolio of equities and equity related securities of companies in the ASEAN region. The Fund adopted a bottom-up stock picking strategy notwithstanding where those companies were listed or whether those companies were represented in any market indices.

2.4 The Fund's asset allocation as at 31 August 2016

Asset 31 August 2016 Listed investment securities 86.4% Short term deposits and cash 13.6%

Reason for the differences in asset allocation The fund increased allocation to quoted investment securities and decreased allocation to cash in order to take advantage of opportunities in the market. Nevertheless, the fund continues to place emphasis on stock selection.



2.5 Fund performance analysis based on NAV per unit (adjusted for income distribution; if any) since date of commencement

Period under review Kenanga ASEAN Tactical Total Return Fund 7.02%

Compounded Return of 8% p.a. 9.41% Source: Lipper

For the financial period under review, the Fund increased 7.02% but underperformed its benchmark of 9.41%

2.6 Review of the market

Market Review

*All returns are in local currency unless mentioned otherwise For the financial period under review (1 Sept 2015 – 31 Aug 2016), the MSCI ASEAN index was up 10.3% in USD and 7.3% in RM. In local currency, outperformers were Indonesia (+19.4%) and Thailand (+12.01%) while the underperformers were Singapore (-3.45%) and Malaysia (+4%). Regional markets suffered a sell-down in September 2015, triggered by concerns over the decline in the Chinese Yuan and potential for further competitive devaluations. Subsequently, markets rebounded in October after the Federal Reserve indicated that the potential rate hike will be delayed. ASEAN currencies continued to weaken, as foreign funds pulled money out of the region. The market remained volatile in 4Q’2015, and remained in a risk off mode ahead of the FED meeting in December. Rising geopolitical tensions between Turkey and Russia, as well as the terror attacks in Paris did not help with the sentiment in the market. On 30th November 2015, IMF board meeting officially approved Renminbi inclusion in the Special Drawing Rights (SDR), effective from 1st October 2016. Following months of uncertainty, the FED finally took action to raise interest rates by 25bps for the first time since 2006 in December 2015. Despite that, guidance for further hikes will be gradual and data dependent. Meanwhile in China, the PBOC introduced a trade-weighted exchange basket for the RMB. 2016 started in risk-off mode, with a sharp correction in the Chinese markets and further RMB depreciation against USD. The Shenzhen, Shanghai and Hang Seng markets plunged 26.8%, 22.7% and 10.2% respectively. Markets only calmed slightly towards month end as China’s fourth quarter GDP of 6.8% came in within expectations. Meanwhile, the European Central Bank (ECB) highlighted that it may deliver additional stimulus in the March meeting with the weakening inflation outlook. The Bank of Japan (BOJ) also surprised markets by introducing negative interest rate for bank’s reserve.


2.6 Review of the market (Contd.)

Market Review (Contd.) The risk off environment continued in February as concerns of low growth and the fallout impact on credit markets from the commodity price declines surfaced. However, market staged a strong rally towards the later part of February, after the Lunar New Year holidays. China played a part in stabilising the market by announcing various easing measures like the reserve requirement ratio (RRR) cut of 50bps. PBOC officials also made statements to assure investors by emphasizing stability in its exchange rate policy. In ASEAN, domestic economy activity in Thailand was supported by government spending and temporary tax incentives. Indonesia cut interest rate by 50bps while Malaysia reduced banks’ reserve requirement by 50bps to ease liquidity. In its budget recalibration in response to lower oil price, the Malaysian government also cut expenditure and remains committed to fiscal deficit of 3.1%. Global equities rebounded strongly in March 2016, driven mainly by more easing from central banks and a slight rebound in oil prices. Additionally, there was positive feedback from G20 meeting in Shanghai and further RRR cut from PBOC at the end of February. The ECB announced additional measures which included further reduction of deposit rates into negative teritory, expanded asset purchases programme and offered fresh funding via targeted LTROs. In the US, the FOMC also provided more dovish guidance with regards to the number of rate hikes in 2016. In Indonesia, the central bank cut rates by a third time in 2016 to 6.5%. Towards the end of 1Q’2016, Asian currencies appreciated against US dollar and markets generally did well as foreign funds flowed back into emerging markets. With the weakness in US dollar, the Brent and WTI crude continued their upward trajectory with gains of 13% and 10% respectively in March. This was also partly driven by the anticipation of potential output freeze deal on the upcoming meeting between OPEC and non-OPEC producers in April. Markets were mixed into April 2016, as the Federal Reserve offered little clues with regards to future rate hikes. The labour market conditions improved but economic growth was slower than expected. Meanwhile, the Bank of Japan (BOJ) also left its monetary policy unchanged in the month end meeting which disappointed most investors betting for additional BOJ easing to weaken the Yen. Further into 2Q’2016, finance chiefs from the world’s biggest developed economies (G7) met in Japan and underscored concerns about flagging global growth and reaffirmed a pledge not to deliberately weaken their currencies even as Japan again warned on the Yen’s surge. Meanwhile, Federal Reserve Chairwoman Janet Yellen signalled that the US central bank will likely raise its interest rates on a gradual basis in the next meetings if the US economy continues to gain strength.



2.5 Fund performance analysis based on NAV per unit (adjusted for income distribution; if any) since date of commencement

Period under review Kenanga ASEAN Tactical Total Return Fund 7.02%

Compounded Return of 8% p.a. 9.41% Source: Lipper

For the financial period under review, the Fund increased 7.02% but underperformed its benchmark of 9.41%

2.6 Review of the market

Market Review

*All returns are in local currency unless mentioned otherwise For the financial period under review (1 Sept 2015 – 31 Aug 2016), the MSCI ASEAN index was up 10.3% in USD and 7.3% in RM. In local currency, outperformers were Indonesia (+19.4%) and Thailand (+12.01%) while the underperformers were Singapore (-3.45%) and Malaysia (+4%). Regional markets suffered a sell-down in September 2015, triggered by concerns over the decline in the Chinese Yuan and potential for further competitive devaluations. Subsequently, markets rebounded in October after the Federal Reserve indicated that the potential rate hike will be delayed. ASEAN currencies continued to weaken, as foreign funds pulled money out of the region. The market remained volatile in 4Q’2015, and remained in a risk off mode ahead of the FED meeting in December. Rising geopolitical tensions between Turkey and Russia, as well as the terror attacks in Paris did not help with the sentiment in the market. On 30th November 2015, IMF board meeting officially approved Renminbi inclusion in the Special Drawing Rights (SDR), effective from 1st October 2016. Following months of uncertainty, the FED finally took action to raise interest rates by 25bps for the first time since 2006 in December 2015. Despite that, guidance for further hikes will be gradual and data dependent. Meanwhile in China, the PBOC introduced a trade-weighted exchange basket for the RMB. 2016 started in risk-off mode, with a sharp correction in the Chinese markets and further RMB depreciation against USD. The Shenzhen, Shanghai and Hang Seng markets plunged 26.8%, 22.7% and 10.2% respectively. Markets only calmed slightly towards month end as China’s fourth quarter GDP of 6.8% came in within expectations. Meanwhile, the European Central Bank (ECB) highlighted that it may deliver additional stimulus in the March meeting with the weakening inflation outlook. The Bank of Japan (BOJ) also surprised markets by introducing negative interest rate for bank’s reserve.



Market Review (Contd.) The risk off environment continued in February as concerns of low growth and the fallout impact on credit markets from the commodity price declines surfaced. However, market staged a strong rally towards the later part of February, after the Lunar New Year holidays. China played a part in stabilising the market by announcing various easing measures like the reserve requirement ratio (RRR) cut of 50bps. PBOC officials also made statements to assure investors by emphasizing stability in its exchange rate policy. In ASEAN, domestic economy activity in Thailand was supported by government spending and temporary tax incentives. Indonesia cut interest rate by 50bps while Malaysia reduced banks’ reserve requirement by 50bps to ease liquidity. In its budget recalibration in response to lower oil price, the Malaysian government also cut expenditure and remains committed to fiscal deficit of 3.1%. Global equities rebounded strongly in March 2016, driven mainly by more easing from central banks and a slight rebound in oil prices. Additionally, there was positive feedback from G20 meeting in Shanghai and further RRR cut from PBOC at the end of February. The ECB announced additional measures which included further reduction of deposit rates into negative teritory, expanded asset purchases programme and offered fresh funding via targeted LTROs. In the US, the FOMC also provided more dovish guidance with regards to the number of rate hikes in 2016. In Indonesia, the central bank cut rates by a third time in 2016 to 6.5%. Towards the end of 1Q’2016, Asian currencies appreciated against US dollar and markets generally did well as foreign funds flowed back into emerging markets. With the weakness in US dollar, the Brent and WTI crude continued their upward trajectory with gains of 13% and 10% respectively in March. This was also partly driven by the anticipation of potential output freeze deal on the upcoming meeting between OPEC and non-OPEC producers in April. Markets were mixed into April 2016, as the Federal Reserve offered little clues with regards to future rate hikes. The labour market conditions improved but economic growth was slower than expected. Meanwhile, the Bank of Japan (BOJ) also left its monetary policy unchanged in the month end meeting which disappointed most investors betting for additional BOJ easing to weaken the Yen. Further into 2Q’2016, finance chiefs from the world’s biggest developed economies (G7) met in Japan and underscored concerns about flagging global growth and reaffirmed a pledge not to deliberately weaken their currencies even as Japan again warned on the Yen’s surge. Meanwhile, Federal Reserve Chairwoman Janet Yellen signalled that the US central bank will likely raise its interest rates on a gradual basis in the next meetings if the US economy continues to gain strength.




Market Review (Contd.) June 2016 was a volatile month for equity markets. While the Federal Reserve kept rates unchanged as expected, the UK referendum to exit EU shocked and sent global markets into correction. Most markets however quickly regained ground towards month end and closed flat or higher for June. Both Philippines and Indonesian markets posted the largest gains in June as investors welcomed the newly elected Duterte administration in Philippines and the passage of the Indonesia tax amnesty law. In July, the global economic landscape remained resilient despite the post-Brexit heightening uncertainty. However, results of central meetings generally disappointed investors, with no new measures released by the Bank of England and European Central Bank, while the Bank of Japan did not lower interest rates further or expand QE. BNM’s 25bp cut in OPR has signalled to the market of its commitment to uphold Malaysia’s economic momentum, which led to an initial positive reaction to the Bursa before normalizing to close flat M/M as Brent crude oil price dropped to US%43.53/barrel on higher than expected inventories, in addition to intensified political noise. In ASEAN markets, Thailand led gains, as the cabinet approved THB44 bn worth of red-line train projects, with Indonesia next as President Jokowi reshuffled 40% of his cabinet. Philippines also posted positive gains as Duterte administration pushes for PPP, tax and budget reforms Asian markets continue to strengthen and outperformed the developed markets in August, thanks to the follow through buying post Brexit. As expected, the Bank of England cut rate and restarted QE while economic indicators in EU was resilient, allaying fear over the Brexit impact. In China, investors shrugged off the subdued economic figures to cheer on the approved Shenzhen-HK stock connect. Meanwhile Yellen indicated that the case for a rate hike has increased but offered no clue over the rate hike timing. In the commodities space, crude oil and palm oil jumped 7.5% M-o-M and 9.1% M-o-M respectively on improved demand outlook. In Thailand, political risk is lower after the positive referendum outcome on Aug 7 and was treated positively by the market on expected inflows and execution improving on government projects.

Outlook & Strategy Markets have received a temporary respite as monetary policy remains largely accommodative. However, the upcoming U.S Presidential Elections is a risk to watch, as investors are generally concerned over the possibility of a populist candidate favouring more protectionist policies winning the election. As such, we remain mostly neutral from an asset allocation perspective. Country wise, we favour Indonesia due to structural reform and positive take-up of the tax amnesty program and also Malaysia particularly in the construction and consumer sector.


2.7 Distribution

For the financial period under review, the Fund did not declare any distribution.

2.8 Details of any unit split exercise

The Fund did not carry out any unit split exercise during the financial period under review.

2.9 Significant changes in the state of affair of the Fund during the financial

period

There were no significant changes in the state of affair of the Fund during the financial period and up until the date of the manager’s report, not otherwise disclosed in the financial statements.

2.10 Circumstances that materially affect any interests of the unitholders

During the financial period under review, there were no circumstances that materially affected any interests of the unitholders.

2.11 Rebates & Soft commissions

Any rebates received are channeled back to the Fund. On the other hand, soft commissions received from the stockbrokers for goods and services such as technical analysis software, fundamental database, financial wire services, stock quotation system and portfolio management software incidental to investment management of the Fund shall be retained by the Manager. For the financial period under review, the Manager has received soft commissions from stockbrokers.



25.7%

26.8%

14.5%

12.0%

21.0%

MALAYSIA

INDONESIA

PHILIPPINES

SINGAPORE

THAILAND

3. FUND PERFORMANCE 3.1 Details of portfolio composition of Kenanga ASEAN Tactical Total Return

Fund (“the Fund”) for the first financial period as at 31 August 2016 are as follows:

a. Distribution among industry sectors and category of investments:

As at 31.8.2016 %

Trading/Services 24.9 Consumer products 21.2 Properties 13.0 Finance 10.2 Constructions 7.0 Industrial products 5.1 Technology 0.6 Real Estate Investment Trusts 2.4 Mutual fund 2.0 Short term deposits and cash 13.6

100.0

Note: The above mentioned percentages are based on total investment market value plus cash.

b. Distribution among markets

As at 31 August 2016, the Fund has invested in the following markets:


3.2 Performance details of the Fund for the first financial period ended 31 August 2016 are as follows:

Period from

1.7.2015 to 31.8.2016

Net asset value ("NAV") (RM Million) 22.13* Units in circulation (Million) 20.68 NAV per unit (RM) 1.0702* Highest NAV per unit (RM/unit) 1.0990 Lowest NAV per unit (RM/unit) 0.9652 Total return (%) 7.02 - Capital growth (%) 7.02 - Income growth (%) - Gross distribution per unit (sen) - Net distribution per unit (sen) - Management expense ratio (“MER”) (%) 2.39 Portfolio turnover ratio (“PTR”) (times) 2.71

Note: Total return is the actual return of the Fund for the financial period

computed based on NAV per unit and net of all fees.

MER is computed based on the total fees and recovered expenses incurred by the Fund divided by the average fund size calculated on a daily basis. PTR is computed based on the average of the total acquisitions and total disposals of investment securities of the Fund divided by the average fund size calculated on a daily basis. * Based on bid price fair valuation method on all investments held by the

Fund as at 31 August 2016, the NAV and NAV per unit would be RM22.06 million and RM1.0669 respectively. (As disclosed under Note 12 of the financial statements)



3.3 Average total return of the Fund

1 Year 31 Aug 2015 - 31 Aug

2016 Kenanga ASEAN Tactical Total Return Fund 9.62%

Compounded Return of 8% p.a. 8.00%

Source: Lipper 3.4 Annual total return of the Fund

Period under review

31 June 2015 - 31 Aug 2016

Kenanga ASEAN Tactical Total Return Fund 7.02% Compounded Return of 8% p.a. 9.41%

Source: Lipper

Investors are reminded that past performance is not necessarily indicative of future performance. Unit prices and investment returns may fluctuate.


4. TRUSTEE’S REPORT TO THE UNITHOLDERS OF KENANGA ASEAN TACTICAL TOTAL RETURN FUND

We, CIMB COMMERCE TRUSTEE BERHAD (“the Trustee”), being the Trustee of KENANGA ASEAN TACTICAL TOTAL RETURN FUND (“the Fund”), are of the opinion that KENANGA INVESTORS BERHAD (“the Manager”), acting in the capacity of Manager of the Fund, has fulfilled its duties in the following manner for the financial period from 1 July 2015 (date of commencement) to 31 August 2016.

a) The Fund has been managed in accordance with the limitations imposed on

the investment powers of the Manager and the Trustee under the Deed, the Securities Commission Malaysia’s Guidelines on Unit Trust Funds, the Capital Markets and Services Act 2007 (as amended from time to time) and other applicable laws;

b) Valuation/pricing of units of the Fund has been carried out in accordance with the Deed and relevant regulatory requirements; and

c) Creation and cancellation of units have been carried out in accordance with the

Deed and relevant regulatory requirements. For and on behalf of CIMB COMMERCE TRUSTEE BERHAD LEE KOOI YOKE Chief Operating Officer Kuala Lumpur, Malaysia 26 October 2016



5. INDEPENDENT AUDITORS’ REPORT TO THE UNITHOLDERS OF KENANGA ASEAN TACTICAL TOTAL RETURN FUND Report on the financial statements We have audited the financial statements of Kenanga ASEAN Tactical Total Return Fund (“the Fund”), which comprise the statement of financial position as at 31 August 2016 and the statement of comprehensive income, statement of changes in net asset value and statement of cash flows for the first financial period from 1 July 2015 (date of commencement) to 31 August 2016, and a summary of significant accounting policies and other explanatory information, as set out on pages 14 to 43. Manager’s and Trustee’s responsibility for the financial statements and fair presentation The Manager of the Fund is responsible for the preparation of financial statements so as to give a true and fair view in accordance with Malaysian Financial Reporting Standards and International Financial Reporting Standards. The Manager is also responsible for such internal control as the Manager determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. The Trustee is responsible for ensuring that the Manager maintains proper accounting and other records as are necessary to enable true and fair presentation of these financial statements. Auditors’ responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgment, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Fund’s preparation of financial statements that give a true and fair view 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. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made by the Manager, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.


5. INDEPENDENT AUDITORS’ REPORT TO THE UNITHOLDERS OF KENANGA ASEAN TACTICAL TOTAL RETURN FUND (CONTD.)

Opinion In our opinion, the financial statements give a true and fair view of the financial position of the Fund as at 31 August 2016 and of its financial performance, changes in net asset value and cash flows for the first financial period from 1 July 2015 (date of commencement) to 31 August 2016 in accordance with Malaysian Financial Reporting Standards and International Financial Reporting Standards. Other matters This report is made solely to the unitholders 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.

Ernst & Young Chan Hooi Lam AF: 0039 No. 2844/02/18(J) Chartered Accountants Chartered Accountant

Kuala Lumpur, Malaysia

26 October 2016



6. STATEMENT BY THE MANAGER I, Ismitz Matthew De Alwis, being a director of Kenanga Investors Berhad, do hereby state that, in the opinion of the Manager, the accompanying statement of financial position as at 31 August 2016 and the related statement of comprehensive income, statement of changes in net asset value and statement of cash flows for the first financial period from 1 July 2015 (date of commencement) to 31 August 2016 together with notes thereto, are drawn up in accordance with Malaysian Financial Reporting Standards and International Financial Reporting Standards so as to give a true and fair view of the financial position of Kenanga ASEAN Tactical Total Return Fund as at 31 August 2016 and of its financial performance and cash flows for the financial period from 1 July 2015 (date of commencement) to 31 August 2016 and comply with the requirements of the Deed.

For and on behalf of the Manager Kenanga Investors Berhad

Ismitz Matthew De Alwis Executive Director/Chief Executive Officer Kuala Lumpur, Malaysia 26 October 2016


7. FINANCIAL STATEMENTS 7.1 STATEMENT OF COMPREHENSIVE INCOME

FOR THE FINANCIAL PERIOD FROM 1 JULY 2015 (DATE OF COMMENCEMENT) TO 31 AUGUST 2016

Note

1.7.2015 (date of

commencement) to 31.8.2016

RM INVESTMENT INCOME Dividend income 383,152 Interest income 155,649 Net gain from investments:

- Financial assets at fair value through profit or loss (“FVTPL”) 4 1,902,547

Loss on foreign currency exchange (495,366) 1,945,982 EXPENSES Manager’s fee 5 409,098 Trustee’s fee 6 12,032 Auditors’ remuneration 10,000 Tax agent’s fee 4,000 Administration expenses 119,874 555,004 NET INCOME BEFORE TAX 1,390,978 Income tax 7 - NET INCOME AFTER TAX,

REPRESENTING TOTAL COMPREHENSIVE INCOME FOR THE FINANCIAL PERIOD 1,390,978

Net income after tax is made up as follows:

Realised gain 442,835 Unrealised gain 948,143

1,390,978

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



6. STATEMENT BY THE MANAGER I, Ismitz Matthew De Alwis, being a director of Kenanga Investors Berhad, do hereby state that, in the opinion of the Manager, the accompanying statement of financial position as at 31 August 2016 and the related statement of comprehensive income, statement of changes in net asset value and statement of cash flows for the first financial period from 1 July 2015 (date of commencement) to 31 August 2016 together with notes thereto, are drawn up in accordance with Malaysian Financial Reporting Standards and International Financial Reporting Standards so as to give a true and fair view of the financial position of Kenanga ASEAN Tactical Total Return Fund as at 31 August 2016 and of its financial performance and cash flows for the financial period from 1 July 2015 (date of commencement) to 31 August 2016 and comply with the requirements of the Deed.

For and on behalf of the Manager Kenanga Investors Berhad

Ismitz Matthew De Alwis Executive Director/Chief Executive Officer Kuala Lumpur, Malaysia 26 October 2016


7. FINANCIAL STATEMENTS 7.1 STATEMENT OF COMPREHENSIVE INCOME

FOR THE FINANCIAL PERIOD FROM 1 JULY 2015 (DATE OF COMMENCEMENT) TO 31 AUGUST 2016

Note

1.7.2015 (date of


RM INVESTMENT INCOME Dividend income 383,152 Interest income 155,649 Net gain from investments:

- Financial assets at fair value through profit or loss (“FVTPL”) 4 1,902,547

Loss on foreign currency exchange (495,366) 1,945,982 EXPENSES Manager’s fee 5 409,098 Trustee’s fee 6 12,032 Auditors’ remuneration 10,000 Tax agent’s fee 4,000 Administration expenses 119,874 555,004 NET INCOME BEFORE TAX 1,390,978 Income tax 7 - NET INCOME AFTER TAX,

REPRESENTING TOTAL COMPREHENSIVE INCOME FOR THE FINANCIAL PERIOD 1,390,978

Net income after tax is made up as follows:

Realised gain 442,835 Unrealised gain 948,143

1,390,978




7.2 STATEMENT OF FINANCIAL POSITION AS AT 31 AUGUST 2016

Note 31.8.2016 RM INVESTMENTS Financial assets at FVTPL 4 18,220,857 Short term deposits 8 650,000 18,870,857 OTHER ASSETS Other receivables 9 1,028,460 Cash at bank 2,218,957 3,247,417 TOTAL ASSETS 22,118,274 LIABILITIES Amount due to Manager 31,363 Amount due to Trustee 967 Other payables 10 23,523 TOTAL LIABILITIES 55,853 EQUITY Unitholders’ contribution 20,671,443 Retained earning 1,390,978 NET ASSET VALUE (“NAV”)

ATTRIBUTABLE TO UNITHOLDERS 11 22,062,421 TOTAL EQUITY AND LIABILITIES 22,118,274 NUMBER OF UNITS IN CIRCULATION 11(a) 20,678,662 NET ASSET VALUE PER UNIT (RM) 12 1.0669



7.3 STATEMENT OF CHANGES IN NET ASSET VALUE FOR THE FINANCIAL PERIOD FROM 1 JULY 2015 (DATE OF COMMENCEMENT) TO 31 AUGUST 2016

Note

Unitholders’ contribution

Retained earning Total NAV

RM RM RM 1.7.2015 (date of


Total comprehensive income - 1,390,978 1,390,978

Creation of units 11(a) 33,617,433 - 33,617,433 Cancellation of units 11(a) (12,940,807) - (12,940,807) Distribution equalisation 11(a) (5,183) - (5,183) At end of the financial

period 20,671,443 1,390,978 22,062,421




7.2 STATEMENT OF FINANCIAL POSITION AS AT 31 AUGUST 2016

Note 31.8.2016 RM INVESTMENTS Financial assets at FVTPL 4 18,220,857 Short term deposits 8 650,000 18,870,857 OTHER ASSETS Other receivables 9 1,028,460 Cash at bank 2,218,957 3,247,417 TOTAL ASSETS 22,118,274 LIABILITIES Amount due to Manager 31,363 Amount due to Trustee 967 Other payables 10 23,523 TOTAL LIABILITIES 55,853 EQUITY Unitholders’ contribution 20,671,443 Retained earning 1,390,978 NET ASSET VALUE (“NAV”)

ATTRIBUTABLE TO UNITHOLDERS 11 22,062,421 TOTAL EQUITY AND LIABILITIES 22,118,274 NUMBER OF UNITS IN CIRCULATION 11(a) 20,678,662 NET ASSET VALUE PER UNIT (RM) 12 1.0669



7.3 STATEMENT OF CHANGES IN NET ASSET VALUE FOR THE FINANCIAL PERIOD FROM 1 JULY 2015 (DATE OF COMMENCEMENT) TO 31 AUGUST 2016

Note

Unitholders’ contribution

Retained earning Total NAV



Total comprehensive income - 1,390,978 1,390,978

Creation of units 11(a) 33,617,433 - 33,617,433 Cancellation of units 11(a) (12,940,807) - (12,940,807) Distribution equalisation 11(a) (5,183) - (5,183) At end of the financial

period 20,671,443 1,390,978 22,062,421




7.4 STATEMENT OF CASH FLOWS FOR THE FINANCIAL PERIOD FROM 1 JULY 2015 (DATE OF COMMENCEMENT) TO 31 AUGUST 2016

1.7.2015 (date of


RM CASH FLOWS FROM OPERATING AND INVESTING

ACTIVITIES Proceeds from sale of financial assets at FVTPL 47,219,704 Dividends received 352,855 Interest from deposits received 155,597 Trustee’s fee paid (11,065) Payment for other fees and expenses (75,692) Manager’s fee paid (376,228) Purchase of financial assets at FVTPL (64,570,784) Net cash used in operating and investing activities (17,305,613) CASH FLOWS FROM FINANCING ACTIVITIES Cash received from units created 33,684,009 Cash paid on units cancelled (13,014,073) Net cash generated from financing activities 20,669,936 NET INCREASE IN CASH AND CASH

EQUIVALENTS 3,364,323 EFFECT OF FOREIGN EXCHANGE RATE

CHANGES (495,366) CASH AND CASH EQUIVALENTS AT DATE OF

COMMENCEMENT - CASH AND CASH EQUIVALENTS AT END OF THE

FINANCIAL PERIOD 2,868,957 Cash and cash equivalents comprise:

Cash at bank 2,218,957 Short term deposits 650,000

2,868,957



7.5 NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL PERIOD FROM 1 JULY 2015 (DATE OF COMMENCEMENT) TO 31 AUGUST 2016

1. THE FUND, THE MANAGER AND THEIR PRINCIPAL ACTIVITIES

Kenanga ASEAN Tactical Total Return Fund ("the Fund") was constituted pursuant to the executed Deed dated 9 December 2013 and First Supplemental Deed dated 29 May 2015 (collectively, referred to as "the Deed") between the Manager, Kenanga Investors Berhad, and CIMB Commerce Trustee Berhad ("the Trustee"). The Fund commenced operations on 1 July 2015 and will continue to be in operation until terminated as provided under Part 12 of the Deed. Kenanga Investors Berhad is a wholly-owned subsidiary of Kenanga Investment Bank Berhad, which in turn is a wholly-owned subsidiary of K & N Kenanga Holdings Berhad that is listed on the Main Market of Bursa Malaysia Securities Berhad. All of these companies are incorporated in Malaysia. The principal place of business of the Manager is Suite 12.02, 12th Floor, Kenanga International, Jalan Sultan Ismail, 50250 Kuala Lumpur. The Fund seeks to provide capital appreciation over the long term (over 5 years) by investing in equities and equity related securities of companies in the ASEAN region. The ASEAN countries that the Fund may invest in will include, but not limited to, Malaysia, Singapore, Indonesia, Thailand, Philippines and Vietnam. The financial statements were authorised for issue by the Chief Executive Officer of the Manager on 26 October 2016.

2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Fund is exposed to a variety of risks including market risk (which includes interest rate risk, price risk and currency risk), credit risk and liquidity risk. Whilst these are the most important types of financial risks inherent in each type of financial instruments, the Manager and the Trustee would like to highlight that this list does not purport to constitute an exhaustive list of all the risks inherent in an investment in the Fund. The Fund has an approved set of investment guidelines and policies as well as internal controls which sets out its overall business strategies to manage these risks to optimise returns and preserve capital for the unitholders, consistent with the long term objectives of the Fund. a. Market Risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk includes interest rate risk, price risk and currency risk.



2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTD.) a. Market Risk (Contd.)

Market risk arises when the value of the investments fluctuates in response to the activities of individual companies, general market or economic conditions. It stems from the fact that there are economy-wide perils, which threaten all businesses. Hence, investors are exposed to market uncertainties. Fluctuation in the investment’s price caused by uncertainties in the economic, political and social environment will affect the NAV of the Fund. The Manager manages the risk of unfavourable changes in prices by cautious review of the investments and continuous monitoring of their performance and risk profiles. i. Interest rate risk

Interest rate risk refers to how the changes in the interest rate environment would affect the performance of the Fund’s investments. Rates offered by the financial institutions will fluctuate according to the Overnight Policy Rate determined by Bank Negara Malaysia and this has direct correlation with the Fund’s investments in deposits. The Fund is not exposed to significant interest rate risk as its deposits are short term in nature and have fixed interest rates. Interest rate risk exposure The following table analyses the Fund’s interest rate risk exposure. The Fund’s assets and liabilities are disclosed at fair value and categorised by the earlier of contractual re-pricing or maturity dates.

Up to 1 year

Non-exposure

to interest rate

movement Total

Weighted average

effective interest

rate* RM RM RM %

31.8.2016 Assets Financial assets at

FVTPL - 18,220,857 18,220,857 Short term deposits 650,000 - 650,000 2.95 Other assets - 3,247,417 3,247,417 650,000 21,468,274 22,118,274


2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTD.)

a. Market Risk (Contd.)

i. Interest rate risk (Contd.) Interest rate risk exposure (Contd.)

Up to 1 year

Non-exposure

to interest rate

movement Total

Weighted average

effective interest

rate* RM RM RM %

31.8.2016 (Contd.) Liabilities Other liabilities - 32,330 32,330 Total interest rate

sensitivity gap 650,000 21,435,944 22,085,944

* Computed based on assets with exposure to interest rate movement only.

ii. Price risk Price risk is the risk of unfavorable changes in the fair values of listed equity securities and listed collective investment schemes. The Fund invests in listed equity securities and listed collective investment schemes which are exposed to price fluctuations. This may then affect the NAV per unit of the Fund. Price risk sensitivity The Manager’s best estimate of the effect on the profit for the financial period due to a reasonably possible change in investments in listed equity securities and listed collective investment schemes with all other variables held constant is indicated in the table below:

Changes in

price Effects on profit for the financial period

Increase/ (Decrease)


Basis points RM 31.8.2016 Financial assets at FVTPL 5/(5) 9,110/(9,110) In practice, the actual trading results may differ from the sensitivity analysis above and the difference could be material.



2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTD.) a. Market Risk (Contd.)

Market risk arises when the value of the investments fluctuates in response to the activities of individual companies, general market or economic conditions. It stems from the fact that there are economy-wide perils, which threaten all businesses. Hence, investors are exposed to market uncertainties. Fluctuation in the investment’s price caused by uncertainties in the economic, political and social environment will affect the NAV of the Fund. The Manager manages the risk of unfavourable changes in prices by cautious review of the investments and continuous monitoring of their performance and risk profiles. i. Interest rate risk

Interest rate risk refers to how the changes in the interest rate environment would affect the performance of the Fund’s investments. Rates offered by the financial institutions will fluctuate according to the Overnight Policy Rate determined by Bank Negara Malaysia and this has direct correlation with the Fund’s investments in deposits. The Fund is not exposed to significant interest rate risk as its deposits are short term in nature and have fixed interest rates. Interest rate risk exposure The following table analyses the Fund’s interest rate risk exposure. The Fund’s assets and liabilities are disclosed at fair value and categorised by the earlier of contractual re-pricing or maturity dates.

Up to 1 year

Non-exposure

to interest rate

movement Total

Weighted average

effective interest

rate* RM RM RM %

31.8.2016 Assets Financial assets at

FVTPL - 18,220,857 18,220,857 Short term deposits 650,000 - 650,000 2.95 Other assets - 3,247,417 3,247,417 650,000 21,468,274 22,118,274




i. Interest rate risk (Contd.) Interest rate risk exposure (Contd.)

Up to 1 year

Non-exposure

to interest rate

movement Total

Weighted average

effective interest

rate* RM RM RM %

31.8.2016 (Contd.) Liabilities Other liabilities - 32,330 32,330 Total interest rate

sensitivity gap 650,000 21,435,944 22,085,944

* Computed based on assets with exposure to interest rate movement only.

ii. Price risk Price risk is the risk of unfavorable changes in the fair values of listed equity securities and listed collective investment schemes. The Fund invests in listed equity securities and listed collective investment schemes which are exposed to price fluctuations. This may then affect the NAV per unit of the Fund. Price risk sensitivity The Manager’s best estimate of the effect on the profit for the financial period due to a reasonably possible change in investments in listed equity securities and listed collective investment schemes with all other variables held constant is indicated in the table below:

Changes in

price Effects on profit for the financial period



Basis points RM 31.8.2016 Financial assets at FVTPL 5/(5) 9,110/(9,110) In practice, the actual trading results may differ from the sensitivity analysis above and the difference could be material.





ii. Price risk (Contd.) Price risk concentration The following table sets out the Fund’s exposure and concentration to price risk based on its portfolio of financial instruments as at the reporting date.

Fair value Percentage

of NAV 31.8.2016 31.8.2016 RM %

Financial assets at FVTPL 18,220,857 82.6 The Fund’s concentration of price risk from the Fund’s listed equity securities and listed collective investment schemes analysed by sector is as follows:


of NAV 31.8.2016 31.8.2016

RM % Trading/Services 5,251,133 23.8 Consumer products 4,469,348 20.3 Properties 2,751,326 12.5 Finance 2,146,562 9.6 Constructions 1,482,189 6.7 Industrial products 1,067,679 4.8 Technology 138,509 0.7 Real Estate Investment Trusts 499,305 2.3 Mutual fund 414,306 1.9 18,220,857 82.6

iii. Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. When the foreign currencies fluctuate in an unfavorable movement against Ringgit Malaysia, the investment face currency loss in addition to capital gain/(loss). This will lead to lower NAV of the Fund. The Manager may consider managing the currency risk using currency hedging. However, this would be subject to the current market outlook on the currency exposure risk as well.



a. Market Risk (Contd.) iii. Currency risk (Contd.)

Currency risk sensitivity The Fund did not have any financial liabilities denominated in foreign currencies as at the reporting date. The following table indicates the currencies to which the Fund had significant exposure at the reporting date on its financial assets. The analysis calculates the effect of a reasonably possible movement of the currency rate against Ringgit Malaysia on profit with all other variables held constant.

Changes in

currency rate Effects on profit for

the financial period Increase/

(Decrease) Increase/

(Decrease) Basis points RM 31.8.2016 IDR/RM 5/(5) 3,187/(3,187) PHP/RM 5/(5) 1,375/(1,375) SGD/RM 5/(5) 1,229/(1,229) THB/RM 5/(5) 2,462/(2,462) USD/RM 5/(5) 40/(40) In practice, the actual trading results may differ from the sensitivity analysis above and the difference could be material. Currency risk concentration The following table sets out the Fund’s exposure to foreign currency exchange rates on its financial assets as at reporting date.

Fair value Percentage of

NAV 31.8.2016 31.8.2016

RM % IDR 6,373,341 28.9 PHP 2,750,564 12.5 SGD 2,457,690 11.1 THB 4,923,050 22.3 USD 80,056 0.4





ii. Price risk (Contd.) Price risk concentration The following table sets out the Fund’s exposure and concentration to price risk based on its portfolio of financial instruments as at the reporting date.


of NAV 31.8.2016 31.8.2016 RM %

Financial assets at FVTPL 18,220,857 82.6 The Fund’s concentration of price risk from the Fund’s listed equity securities and listed collective investment schemes analysed by sector is as follows:


of NAV 31.8.2016 31.8.2016

RM % Trading/Services 5,251,133 23.8 Consumer products 4,469,348 20.3 Properties 2,751,326 12.5 Finance 2,146,562 9.6 Constructions 1,482,189 6.7 Industrial products 1,067,679 4.8 Technology 138,509 0.7 Real Estate Investment Trusts 499,305 2.3 Mutual fund 414,306 1.9 18,220,857 82.6

iii. Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. When the foreign currencies fluctuate in an unfavorable movement against Ringgit Malaysia, the investment face currency loss in addition to capital gain/(loss). This will lead to lower NAV of the Fund. The Manager may consider managing the currency risk using currency hedging. However, this would be subject to the current market outlook on the currency exposure risk as well.



a. Market Risk (Contd.) iii. Currency risk (Contd.)

Currency risk sensitivity The Fund did not have any financial liabilities denominated in foreign currencies as at the reporting date. The following table indicates the currencies to which the Fund had significant exposure at the reporting date on its financial assets. The analysis calculates the effect of a reasonably possible movement of the currency rate against Ringgit Malaysia on profit with all other variables held constant.

Changes in

currency rate Effects on profit for

the financial period Increase/

(Decrease) Increase/

(Decrease) Basis points RM 31.8.2016 IDR/RM 5/(5) 3,187/(3,187) PHP/RM 5/(5) 1,375/(1,375) SGD/RM 5/(5) 1,229/(1,229) THB/RM 5/(5) 2,462/(2,462) USD/RM 5/(5) 40/(40) In practice, the actual trading results may differ from the sensitivity analysis above and the difference could be material. Currency risk concentration The following table sets out the Fund’s exposure to foreign currency exchange rates on its financial assets as at reporting date.

Fair value Percentage of

NAV 31.8.2016 31.8.2016

RM % IDR 6,373,341 28.9 PHP 2,750,564 12.5 SGD 2,457,690 11.1 THB 4,923,050 22.3 USD 80,056 0.4




b. Credit Risk Credit risk is the risk that the counterparty to a financial instrument will cause a financial loss to the Fund by failing to discharge an obligation. The Manager manages the credit risk by undertaking credit evaluation to minimise such risk. i. Credit risk exposure

As at the reporting date, the Fund’s maximum exposure to credit risk is represented by the carrying amount of each class of financial asset recognised in the statement of financial position.

ii. Financial assets that are either past due or impaired As at the reporting date, there are no financial assets that are either past due or impaired.

iii. Credit quality of financial assets

The Fund invests in deposits with financial institutions licensed under the Financial Services Act 2013 and Islamic Financial Services Act 2013. The following table analyses the licensed financial institutions by rating category: Short term deposits

Percentage of total short term

deposits

Percentage of

NAV 31.8.2016 31.8.2016

% % Rating P1 100.0 2.9

c. Liquidity Risk

Liquidity risk is defined as the risk that the Fund will encounter difficulty in meeting obligations associated with financial liabilities that are to be settled by delivering cash or another financial asset. Exposure to liquidity risk arises because of the possibility that the Fund could be required to pay its liabilities or cancel its units earlier than expected. The Fund is exposed to cancellation of its units on a regular basis. Units sold to unitholders by the Manager are cancellable at the unitholders’ option based on the Fund’s NAV per unit at the time of cancellation calculated in accordance with the Deed. The liquid assets comprise cash, deposits with licensed financial institutions and other instruments, which are capable of being converted into cash within 7 days.



c. Liquidity Risk (Contd.) The following table analyses the maturity profile of the Fund’s financial assets and financial liabilities in order to provide a complete view of the Fund’s contractual commitments and liquidity. Up to 1 year Note 31.8.2016 RM Assets Financial assets at FVTPL 18,220,857 Short term deposits 650,000 Other assets 3,247,417 (i) 22,118,274 Liabilities Other liabilities (ii) 32,330 Equity (iii) 22,062,421 Liquidity gap 23,523

(i) Financial assets

Analysis of financial assets at FVTPL into maturity groupings is based on the expected date on which these assets will be realised. The Fund’s investments in listed equity securities and listed collective investment schemes have been included in the “up to 1 year” category on the assumption that these are highly liquid investments which can be realised should all of the Fund’s unitholders’ equity be required to be redeemed. For other assets, the analysis into maturity groupings is based on the remaining period from the end of the reporting period to the contractual maturity date or if earlier, the expected date on which the assets will be realised.

(ii) Financial liabilities

The maturity grouping is based on the remaining period from the end of the reporting period to the contractual maturity date or if earlier, the date on which liabilities will be settled. When the counterparty has a choice of when the amount is paid, the liability is allocated to the earliest period in which the Fund can be required to pay.

(iii) Equity

As unitholders can request for redemption of their units, they have been categorised as having a maturity of “up to 1 year”.



3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Basis of Accounting The financial statements of the Fund have been prepared in accordance with Malaysian Financial Reporting Standards (“MFRS”) as issued by the Malaysian Accounting Standards Board (“MASB”) and International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The financial statements have been prepared on the historical cost basis except as disclosed in the accounting policies below.

b. Standards and Amendments Issued But Not Yet Effective

As at the reporting date, the following Standards and Amendments that have been issued by MASB will be effective for the Fund in future financial periods. The Fund intends to adopt the relevant standards when they become effective.

Description

Effective for financial period beginning on or

after Amendments to MFRS contained in the documents entitled

“Annual Improvements to MFRSs 2012 – 2014 Cycle” 1 January 2016MFRS 14: Regulatory Deferral Accounts 1 January 2016Amendments to MFRS 10, MFRS 12 and MFRS 128:

Investment Entities: Applying the Consolidation Exception 1 January 2016Amendments to MFRS 11: Accounting for Acquisitions of

Interests in Joint Operations 1 January 2016Amendments to MFRS 101: Disclosure Initiative 1 January 2016Amendments to MFRS 116 and MFRS 138: Clarification of

Acceptable Methods of Depreciation and Amortisation 1 January 2016Amendments to MFRS 116 and MFRS 141: Agriculture:

Bearer Plants 1 January 2016Amendments to MFRS 127: Equity Method in Separate

Financial Statements 1 January 2016Amendments to MFRS 107: Disclosure Initiative 1 January 2017Amendments to MFRS 112: Recognition of Deferred Tax

Assets for Unrealised Losses 1 January 2017MFRS 9: Financial Instruments 1 January 2018MFRS 15: Revenue from Contracts with Customers 1 January 2018MFRS 16: Leases 1 January 2019Amendments to MFRS 10 and MFRS 128: Sale or

Contribution of Assets between an Investor and its Associate or Joint Venture

To be announced by MASB


3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD.)

b. Standards and Amendments Issued But Not Yet Effective (Contd.) The Fund will adopt the above pronouncements when they become effective in the respective financial periods. These pronouncements are not expected to have any significant impact to the financial statements of the Fund upon their initial application, other than MFRS 9. MFRS 9 replaces MFRS 139 on the following requirements: classification and measurement of financial assets and financial liabilities as defined in MFRS 139, impairment methodology and hedge accounting. The Fund is in the process of making an assessment of the impact of this Standard.

c. Financial Assets

Financial assets are recognised in the statement of financial position when, and only when, the Fund becomes a party to the contractual provisions of the financial instruments. When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets not at FVTPL, directly attributable transaction costs. The Fund determines the classification of its financial assets at initial recognition.

i. Financial assets at FVTPL

Financial assets are classified as financial assets at FVTPL if they are held for trading or are designated as such upon initial recognition. Financial assets held for trading include listed equity securities and listed collective investment schemes acquired principally for the purpose of selling in the near term. Subsequent to initial recognition, financial assets at FVTPL are measured at fair value. Changes in the fair value of those financial instruments are recorded in profit or loss. Interest earned and dividend revenue elements of such instruments are recorded separately in “interest income” and “dividend income”, respectively.

ii. Receivables

Financial assets with fixed or determinable payments that are not listed in an active market are classified as receivables. Subsequent to initial recognition, receivables are measured at amortised cost using the effective interest method. Gain or loss is recognised in profit or loss when the receivable is derecognised or impaired, and through the amortisation process.



3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Basis of Accounting The financial statements of the Fund have been prepared in accordance with Malaysian Financial Reporting Standards (“MFRS”) as issued by the Malaysian Accounting Standards Board (“MASB”) and International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The financial statements have been prepared on the historical cost basis except as disclosed in the accounting policies below.

b. Standards and Amendments Issued But Not Yet Effective

As at the reporting date, the following Standards and Amendments that have been issued by MASB will be effective for the Fund in future financial periods. The Fund intends to adopt the relevant standards when they become effective.

Description

Effective for financial period beginning on or

after Amendments to MFRS contained in the documents entitled

“Annual Improvements to MFRSs 2012 – 2014 Cycle” 1 January 2016MFRS 14: Regulatory Deferral Accounts 1 January 2016Amendments to MFRS 10, MFRS 12 and MFRS 128:

Investment Entities: Applying the Consolidation Exception 1 January 2016Amendments to MFRS 11: Accounting for Acquisitions of

Interests in Joint Operations 1 January 2016Amendments to MFRS 101: Disclosure Initiative 1 January 2016Amendments to MFRS 116 and MFRS 138: Clarification of

Acceptable Methods of Depreciation and Amortisation 1 January 2016Amendments to MFRS 116 and MFRS 141: Agriculture:

Bearer Plants 1 January 2016Amendments to MFRS 127: Equity Method in Separate

Financial Statements 1 January 2016Amendments to MFRS 107: Disclosure Initiative 1 January 2017Amendments to MFRS 112: Recognition of Deferred Tax

Assets for Unrealised Losses 1 January 2017MFRS 9: Financial Instruments 1 January 2018MFRS 15: Revenue from Contracts with Customers 1 January 2018MFRS 16: Leases 1 January 2019Amendments to MFRS 10 and MFRS 128: Sale or

Contribution of Assets between an Investor and its Associate or Joint Venture

To be announced by MASB



b. Standards and Amendments Issued But Not Yet Effective (Contd.) The Fund will adopt the above pronouncements when they become effective in the respective financial periods. These pronouncements are not expected to have any significant impact to the financial statements of the Fund upon their initial application, other than MFRS 9. MFRS 9 replaces MFRS 139 on the following requirements: classification and measurement of financial assets and financial liabilities as defined in MFRS 139, impairment methodology and hedge accounting. The Fund is in the process of making an assessment of the impact of this Standard.

c. Financial Assets

Financial assets are recognised in the statement of financial position when, and only when, the Fund becomes a party to the contractual provisions of the financial instruments. When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets not at FVTPL, directly attributable transaction costs. The Fund determines the classification of its financial assets at initial recognition.

i. Financial assets at FVTPL

Financial assets are classified as financial assets at FVTPL if they are held for trading or are designated as such upon initial recognition. Financial assets held for trading include listed equity securities and listed collective investment schemes acquired principally for the purpose of selling in the near term. Subsequent to initial recognition, financial assets at FVTPL are measured at fair value. Changes in the fair value of those financial instruments are recorded in profit or loss. Interest earned and dividend revenue elements of such instruments are recorded separately in “interest income” and “dividend income”, respectively.

ii. Receivables

Financial assets with fixed or determinable payments that are not listed in an active market are classified as receivables. Subsequent to initial recognition, receivables are measured at amortised cost using the effective interest method. Gain or loss is recognised in profit or loss when the receivable is derecognised or impaired, and through the amortisation process.




c. Financial Assets (Contd.)

A financial asset is derecognised when the contractual right to receive cash flows from the asset has expired. On derecognition of a financial asset, the difference between the carrying amount and the sum of the consideration received is recognised in profit or loss.

d. Impairment of Financial Assets

The Fund assesses at each reporting date whether there is any objective evidence that a financial asset is impaired. To determine whether there is objective evidence that an impairment loss on financial assets has been incurred, the Fund considers factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments. If any such evidence exists, the amount of impairment loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the financial asset’s original effective interest rate. The impairment loss is recognised in profit or loss. The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets, with the exception of receivables, where the carrying amount is reduced through the use of an allowance account. When a receivable becomes uncollectible, it is written off against the allowance account. 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, the previously recognised impairment loss is reversed to the extent that the carrying amount of the assets does not exceed its amortised cost at the reversal date. The amount of reversal is recognised in profit or loss.

e. Income Income is recognised to the extent that it is probable that the economic benefits will flow to the Fund and the income can be reliably measured. Income is measured at the fair value of consideration received or receivable. Interest income is recognised using the effective interest method. Dividend income is recognised on declared basis, when the right to receive the dividend is established. The realised gain or loss on sale of investments is measured as the difference between the net disposal proceeds and the carrying amount of the investment.



f. Cash and Cash Equivalents For the purposes of the statement of cash flows, cash and cash equivalents include cash at bank and short term deposits with licensed financial institutions with insignificant risk of change in value.

g. Income Tax Income tax on the profit or loss for the financial period comprises current tax. Current tax is the expected amount of income taxes payable in respect of the taxable profit for the financial period. As no temporary differences have been identified, no deferred tax has been recognised.

h. Unrealised Reserves Unrealised reserves represent the net gain or loss arising from carrying investments at their fair values and unrealised gain or loss from translating foreign currency monetary items at the exchange rate prevailing at reporting date. This reserve is not distributable.

i. Financial Liabilities Financial liabilities are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability. Financial liabilities 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. The Fund’s financial liabilities are classified as other financial liabilities. The Fund’s financial liabilities are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. A financial liability is derecognised when the obligation under the liability is extinguished. Gains and losses are recognised in profit or loss when the liabilities are derecognised, and through the amortisation process.

j. Unitholders’ Contribution – NAV Attributable to Unitholders The unitholders’ contribution to the Fund is classified as equity instruments. Distribution equalisation represents the average amount of undistributed net income included in the creation or cancellation price of units. This amount is either refunded to unitholders by way of distribution and/or adjusted accordingly when units are released back to the Trustee.




k. Foreign Currency i. Functional and Presentation Currency

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 also the Fund’s functional currency.

ii. Foreign currency transaction

In preparing the financial statements of the Fund, transactions in currencies other than the Fund’s functional currency (foreign currencies) are recorded in the functional currency using exchange rates prevailing at the dates of the transactions. At each reporting date, monetary items denominated in foreign currencies are translated at the rates prevailing on the reporting date. All exchange gain or loss is recognised in profit or loss. Exchange differences arising on the settlement of monetary items, and on the translation of monetary items, are included in profit or loss for the financial period. The principal exchange rate for each respective units of foreign currency ruling at reporting date is as follows: 31.8.2016 RM

1000 IDR 0.3058 1 PHP 0.0874 1 SGD 2.9691 100 THB 11.7062 1 USD 4.0650

l. Distribution

Distributions are at the discretion of the Manager. A distribution to the Fund’s unitholders is accounted for as a deduction from retained earnings.



m. Significant Accounting Judgments and Estimates

The preparation of financial statements requires the use of certain accounting estimates and exercise of judgment. Estimates and judgments are continually evaluated and are based on past experience, reasonable expectations of future events and other factors.

i. Critical judgments made in applying accounting policies

There are no major judgments made by the Manager in applying the Fund's accounting policies.

ii. Key sources of estimation uncertainty There are no key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial period.

4. FINANCIAL ASSETS AT FVTPL

31.8.2016 RM Financial assets held for trading, at FVTPL:

Listed equity securities in Malaysia 4,432,847 Listed collective investment scheme in Malaysia 260,400 Listed equity securities in Indonesia 4,879,512 Listed equity securities in Philippines 2,639,277 Listed equity securities in Singapore 1,941,292 Listed collective investment scheme in Singapore 238,905 Listed equity securities in Thailand 3,414,318 Listed collective investment scheme in Thailand 414,306 18,220,857 1.7.2015

(date of commencement)

to 31.8.2016 RM

Net gain on financial assets at FVTPL comprised: Realised gain on disposals 963,879 Unrealised changes in fair values 938,668 1,902,547



4. FINANCIAL ASSETS AT FVTPL (CONTD.)

Details of financial assets at FVTPL as at 31 August 2016: Quantity

Aggregate cost Fair value

Percentage of NAV

RM RM % Listed equity securities in

Malaysia Trading/Services Bison Consolidated Berhad 144,600 200,160 228,468 1.0 Bumi Armada Berhad 581,200 537,682 430,088 1.9 Destini Berhad 212,600 127,276 160,513 0.7 Genting Berhad 55,200 472,914 430,560 2.0 George Kent (Malaysia)

Berhad 104,600 222,955 283,466 1.3 Yinson Holdings Berhad 163,000 441,263 500,410 2.3 2,002,250 2,033,505 9.2 Consumer products Carlsberg Brewery Malaysia

Berhad 29,400 372,003 432,180 1.9 Magni-Tech Industries

Berhad 60,800 253,451 240,768 1.1 Salutica Berhad 335,000 332,909 368,500 1.7 958,363 1,041,448 4.7 Industrial products EG Industries Berhad 76,000 61,466 66,500 0.3 Jaya Tiasa Holdings Berhad 59,000 90,151 71,980 0.3 Pecca Group Berhad 233,800 440,809 425,516 2.0 Success Transformer

Corporation Berhad 135,800 277,719 234,934 1.1 United U-LI Corporation

Berhad 12,300 43,050 45,879 0.2 913,195 844,809 3.9 Construction Sunway Construction Group

Berhad 228,400 380,170 374,576 1.7 Technology KESM Industries Berhad 14,900 81,624 115,773 0.5 ManagePay Systems

Berhad 142,100 36,780 22,736 0.1 118,404 138,509 0.6 Total listed equity

securities in Malaysia 4,372,382 4,432,847 20.1



Details of financial assets at FVTPL as at 31 August 2016: (Contd.) Quantity


Percentage of NAV

RM RM % Listed collective

investment scheme in Malaysia

Real Estate Investment

Trusts IGB Real Estate Investment

Trust 155,000 233,406 260,400 1.2 Total listed collective

investment scheme in Malaysia 233,406 260,400 1.2

Listed equity securities in

Indonesia Trading/Services PT Indosat Tbk 259,400 453,475 473,964 2.2 PT Media Nusantara Citra

Tbk 388,000 232,757 227,216 1.0 PT Telekomunikasi

Indonesia Persero Tbk 575,500 540,399 730,350 3.3 PT XL Axiata Tbk 400,300 454,422 347,649 1.6 1,681,053 1,779,179 8.1 Properties PT Bekasi Fajar Industrial

Estate Tbk 2,121,700 193,568 203,728 0.9 PT Bumi Serpong Damai

Tbk 705,000 444,613 450,581 2.0 PT Summarecon Agung Tbk 767,500 359,883 416,595 1.9 998,064 1,070,904 4.8 Consumer products PT Indofood Sukses

Makmur Tbk 206,100 449,968 496,325 2.3 PT Nippon Indosari

Corpindo Tbk 1,123,700 428,811 537,777 2.4 878,779 1,034,102 4.7 Constructions PT Adhi Karya (Persero)

Tbk 557,400 369,640 456,814 2.1 PT Pembangunan

Perumahan (Persero) Tbk 167,900 199,588 220,265 1.0 569,228 677,079 3.1




Details of financial assets at FVTPL as at 31 August 2016: Quantity


Percentage of NAV


Malaysia Trading/Services Bison Consolidated Berhad 144,600 200,160 228,468 1.0 Bumi Armada Berhad 581,200 537,682 430,088 1.9 Destini Berhad 212,600 127,276 160,513 0.7 Genting Berhad 55,200 472,914 430,560 2.0 George Kent (Malaysia)

Berhad 104,600 222,955 283,466 1.3 Yinson Holdings Berhad 163,000 441,263 500,410 2.3 2,002,250 2,033,505 9.2 Consumer products Carlsberg Brewery Malaysia

Berhad 29,400 372,003 432,180 1.9 Magni-Tech Industries

Berhad 60,800 253,451 240,768 1.1 Salutica Berhad 335,000 332,909 368,500 1.7 958,363 1,041,448 4.7 Industrial products EG Industries Berhad 76,000 61,466 66,500 0.3 Jaya Tiasa Holdings Berhad 59,000 90,151 71,980 0.3 Pecca Group Berhad 233,800 440,809 425,516 2.0 Success Transformer

Corporation Berhad 135,800 277,719 234,934 1.1 United U-LI Corporation

Berhad 12,300 43,050 45,879 0.2 913,195 844,809 3.9 Construction Sunway Construction Group

Berhad 228,400 380,170 374,576 1.7 Technology KESM Industries Berhad 14,900 81,624 115,773 0.5 ManagePay Systems

Berhad 142,100 36,780 22,736 0.1 118,404 138,509 0.6 Total listed equity

securities in Malaysia 4,372,382 4,432,847 20.1





Percentage of NAV

RM RM % Listed collective

investment scheme in Malaysia

Real Estate Investment

Trusts IGB Real Estate Investment

Trust 155,000 233,406 260,400 1.2 Total listed collective

investment scheme in Malaysia 233,406 260,400 1.2

Listed equity securities in

Indonesia Trading/Services PT Indosat Tbk 259,400 453,475 473,964 2.2 PT Media Nusantara Citra

Tbk 388,000 232,757 227,216 1.0 PT Telekomunikasi

Indonesia Persero Tbk 575,500 540,399 730,350 3.3 PT XL Axiata Tbk 400,300 454,422 347,649 1.6 1,681,053 1,779,179 8.1 Properties PT Bekasi Fajar Industrial

Estate Tbk 2,121,700 193,568 203,728 0.9 PT Bumi Serpong Damai

Tbk 705,000 444,613 450,581 2.0 PT Summarecon Agung Tbk 767,500 359,883 416,595 1.9 998,064 1,070,904 4.8 Consumer products PT Indofood Sukses

Makmur Tbk 206,100 449,968 496,325 2.3 PT Nippon Indosari

Corpindo Tbk 1,123,700 428,811 537,777 2.4 878,779 1,034,102 4.7 Constructions PT Adhi Karya (Persero)

Tbk 557,400 369,640 456,814 2.1 PT Pembangunan

Perumahan (Persero) Tbk 167,900 199,588 220,265 1.0 569,228 677,079 3.1






Percentage of NAV


Indonesia (Contd.) Finance PT Bank Rakyat Indonesia

(Persero) Tbk 90,300 292,498 318,248 1.4 Total listed equity

securities in Indonesia 4,419,622 4,879,512 22.1 Listed equity securities in

Philippines Finance GT Capital Holdings, Inc. 4,825 672,931 647,317 2.9 Metropolitan Bank & Trust

Co. 88,000 670,797 661,443 3.0 1,343,728 1,308,760 5.9 Consumer products Robinsons Retail Holdings,

Inc. 92,200 602,639 656,750 3.0 Property Ayala Land, Inc. 134,000 443,245 450,897 2.1 Industrial products CEMEX Philippines

Holdings 212,500 196,213 222,870 1.0 Total listed equity

securities in Philippines 2,585,825 2,639,277 12.0 Listed equity securities in

Singapore Trading/Services Raffles Medical Group Ltd 54,562 247,215 248,670 1.1 Singapore

Telecommunications Limited 61,000 709,166 740,761 3.4

956,381 989,431 4.5





Percentage of NAV

RM RM % Listed equity securities

in Singapore (Contd.) Consumer products Duty Free International

Limited 567,500 538,036 657,136 3.0 Finance DBS Group Holdings Ltd 6,600 303,147 294,725 1.3 Total listed equity

securities in Singapore 1,797,564 1,941,292 8.8 Listed collective

investment scheme in Singapore

Real Estate Investments

Trusts Mapletree Logistics Trust 75,200 230,879 238,905 1.1 Total listed collective

investment scheme in Singapore 230,879 238,905 1.1

Listed equity securities

in Thailand Properties AP (Thailand) Public

Company Limited 385,200 289,906 338,192 1.5 Central Pattana Public

Company Limited 85,000 577,714 592,041 2.7 Quality Houses Public

Company Limited 933,100 257,516 299,292 1.4 1,125,136 1,229,525 5.6 Consumer products Berli Jucker Public

Company Limited 79,100 452,920 416,682 1.9 CP All Public Company

Limited 92,500 525,520 663,230 3.0 978,440 1,079,912 4.9






Percentage of NAV


Thailand (Contd.) Trading/Services Airports of Thailand Public

Company Limited 9,600 442,438 449,518 2.0 Construction Sino-Thai Engineering and

Construction Public Company Limited 148,900 434,727 430,534 1.9

Finance Kasikornbank Public

Company Limited 9,700 223,510 224,829 1.0 Total listed equity

securities in Thailand 3,204,251 3,398,090 15.4 Listed collective

investment scheme in Thailand

Mutual fund Jasmine Broadband Internet

Infrastructure Fund 316,000 438,260 414,306 1.9 Total listed collective

investment scheme in Thailand 438,260 414,306 1.9

Total financial assets at

FVTPL 17,282,189 18,220,857 82.6 Unrealised gain on

financial assets at FVTPL 938,668

5. MANAGER’S FEE

The Manager’s fee is computed on a daily basis at a rate not exceeding 2.00% per annum of the NAV of the Fund as provided under Division 13.1 of the Deed. The Manager is currently charging Manager’s fee of 1.70% per annum of the NAV of the Fund.


6. TRUSTEE’S FEE

The Trustee’s fee is computed on a daily basis at a rate not exceeding 0.05% per annum of the NAV of the Fund as provided under Division 13.2 of the Deed. The Trustee’s fee is currently computed at 0.05% per annum of the NAV of the Fund.

7. INCOME TAX

Income tax is calculated at the Malaysian statutory tax rate of 24% of the estimated assessable income for the financial period. Income tax is calculated on investment income less partial deduction for permitted expenses as provided for under Section 63B of the Income Tax Act, 1967. A reconciliation of income tax expense applicable to net income before tax at the statutory income tax rate to income tax expense at the effective income tax rate of the Fund is as follows:

1.7.2015 (date of

commencement ) to 31.8.2016

RM Net income before tax 1,390,978 Tax at Malaysian statutory tax rate of 24% 333,835 Tax effect of:

Income not subject to tax (585,924) Loss not deductible for tax purposes 118,888 Expenses not deductible for tax purposes 30,232 Restriction on tax deductible expenses for unit trust

fund

102,969 Income tax for the financial period -

8. SHORT TERM DEPOSITS

Short term deposits are held with licensed financial institutions in Malaysia at the prevailing interest rates.

9. OTHER RECEIVABLES

31.8.2016 RM Amount due from licensed financial institutions 998,111 Dividend receivable 30,297 Interest receivable from short term deposits 52 1,028,460



10. OTHER PAYABLES

31.8.2016 RM Accrual for auditors’ remuneration 10,000 Accrual for tax agent’s fees 4,000 Provision for printing and other expenses 9,523 23,523

11. NET ASSET VALUE ATTRIBUTABLE TO UNITHOLDERS

NAV attributed to unitholders is represented by: Note 31.8.2016 RM Unitholders’ contribution (a) 20,671,443 Retained earnings:

Realised reserves 442,835 Unrealised reserves 948,143 1,390,978 22,062,421

(a) Unitholders’ contribution

1.7.2015 (date of commencement) to 31.8.2016 No. of units RM

Add: Creation of units 33,313,971 33,617,433 Less: Cancellation of units (12,635,309) (12,940,807) Distribution equalisation - (5,183) At end of the financial period 20,678,662 20,671,443

The number of units legally or beneficially held by the Manager, Kenanga Investors Berhad, and parties related to the Manager as at 31 August 2016 were nil.


12. NET ASSET VALUE PER UNIT

In line with the adoption of MFRS 139, financial assets at FVTPL have been valued at the bid prices at the close of business. In accordance with the Deed, the calculation of NAV attributable to unitholders per unit for the creation and cancellation of units is computed based on financial assets at FVTPL valued at the last done market price. A reconciliation of NAV attributable to unitholders for creation/cancellation of units and the NAV attributable to unitholders per the financial statements is as follows:

31.8.2016 RM RM/Unit NAV attributable to unitholders for

creation/cancellation of units 22,130,418 1.0702 Effects of adopting bid prices as fair value (67,997) (0.0033) NAV attributable to unitholders per statement of

financial position 22,062,421 1.0669 13. PORTFOLIO TURNOVER RATIO (“PTR”) PTR for the financial period from 1 July 2015 (date of commencement) to 31 August

2016 is 2.71 times.

PTR is the ratio of average sum of acquisitions and disposals of investments of the Fund for the financial period to the average NAV of the Fund, calculated on a daily basis.

14. MANAGEMENT EXPENSE RATIO (“MER”)

MER for the financial period from 1 July 2015 (date of commencement) to 31 August 2016 is 2.39%. MER is the ratio the sum of annualised fees and recovered expenses of the Fund expressed as a percentage of the Fund’s average NAV, calculated on a daily basis.



15. TRANSACTIONS WITH LICENSED FINANCIAL INSTITUTIONS

Transaction

value Percentage

of total

Brokerage, stamp duty

and clearing fee

Percentage of total

RM % RM % Public Bank Berhad 32,751,968 20.0 - - Instinet Pacific Limited 24,371,660 14.9 75,392 21.7 Kenanga Investment

Bank Berhad* 18,110,063 11.0 34,194 9.8 UOB Kay Hian Pte Ltd 17,618,980 10.7 44,056 12.7 JPMorgan Securities

(Malaysia) Sdn Bhd 11,080,225 6.8 36,040 10.4 Affin Hwang Investment

Bank Berhad 9,500,673 5.8 31,338 9.0 Affin Bank Berhad 8,608,648 5.2 - - Macquarie Capital

Securities (Malaysia) Sdn Bhd 7,978,807 4.9 25,802 7.4

Maybank Investment Bank Berhad 7,117,084 4.3 23,009 6.6

Instinet Singapore Services Pte Ltd 7,102,464 4.3 17,055 4.9

Others 19,840,826 12.1 61,023 17.5 164,081,398 100.0 347,909 100.0

* Kenanga Investment Bank Berhad is a related party of Kenanga Investors Berhad.

The above transaction values are in respect of listed equity securities, listed collective investment schemes and short term deposits. Transactions in short term deposits do not involve any commission or brokerage fees.

The directors of the Manager are of the opinion that the transactions with the related party have been entered into in the normal course of business and have been established on terms and conditions that are not materially different from that obtainable in transactions with unrelated parties. The Manager is of the opinion that the above dealings have been transacted on an arm’s length basis.


16. SEGMENTAL REPORTING

a. Business Segments

In accordance with the objective of the Fund, the Fund can invest 70% to 99% in listed investment securities. The following table provides an analysis of the Fund’s revenue, results, assets and liabilities by business segments:

Listed

investment securities

Other investments Total


commencement) to 31.8.2016 Revenue Segment income 2,285,699 155,649 2,441,348 Unallocated loss on foreign

currency exchange (495,366) 1,945,982 Unallocated expenditure (555,004) Income before tax 1,390,978 Income tax - Net income after tax 1,390,978 31.8.2016 Assets Financial assets at FVTPL 18,220,857 - Short term deposits - 650,000 Other segment assets 1,028,408 52 Total segment assets 19,249,265 650,052 19,899,317 Unallocated assets 2,218,957 22,118,274 Liabilities Unallocated liabilities 55,853



16. SEGMENTAL REPORTING (CONTD.)

b. Geographical Segments The Fund seeks to achieve its investment objective by investing in a diversified portfolio of equities and equity related securities of companies in the member countries of Association of South East Asian Nations. The following table provide an analysis of the Fund’s revenue, results, assets and liabilities by geographical segments: Local

investments Foreign

investments Total RM RM RM 1.7.2015 (date of

commencement) to 31.8.2016 Revenue Segment income 889,774 1,551,574 2,441,348 Unallocated loss on foreign

currency exchange (495,366) 1,945,982 Unallocated expenditure (555,004) Income before tax 1,390,978 Income tax - Net income after tax 1,390,978 31.8.2016 Assets Financial assets at FVTPL 4,693,247 13,527,610 Short term deposits 650,000 - Other segment assets 98,038 930,422 Total segment assets 5,441,285 14,458,032 19,899,317 Unallocated assets 2,218,957 22,118,274 Liabilities Unallocated liabilities 55,853


17. FINANCIAL INSTRUMENTS

a. Classification of financial instruments

The Fund’s financial assets and financial liabilities are measured on an ongoing basis at either fair value or at amortised cost based on their respective classification. The significant accounting policies in Note 3 describe how the classes of financial instruments are measured, and how income and expenses, including fair value gains and losses, are recognised.

The following table analyses the financial assets and liabilities of the Fund in the statement of financial position by the class of financial instruments to which they are assigned and therefore by the measurement basis.

Financial assets at

FVTPL Receivables Financial liabilities Total

RM RM RM RM 31.8.2016 Assets Listed equity securities 17,721,552 - - 17,721,552 Listed collective

investment schemes 499,305 - - 499,305 Short term deposits - 650,000 - 650,000 Other receivables - 1,028,460 - 1,028,460 Cash at bank - 2,218,957 - 2,218,957 18,220,857 3,897,417 - 22,118,274 Liabilities Amount due to

Manager - - 31,363 31,363 Amount due to Trustee - - 967 967 - - 32,330 32,330

b. Financial instruments that are carried at fair value

The Fund’s financial assets at FVTPL are carried at fair value. The fair values of these financial assets were determined using prices in active markets.

The following table shows the fair value measurements by level of the fair value measurement hierarchy: Level 1 Level 2 Level 3 Total RM RM RM RM Investments: 31.8.2016 - Listed equity securities 17,721,552 - - 17,721,552 - Listed collective investment

schemes 499,305 - - 499,305



17. FINANCIAL INSTRUMENTS (CONTD.)

b. Financial instruments that are carried at fair value (Contd.)

Level 1: Listed prices in active market Level 2: Model with all significant inputs which are observable market data Level 3: Model with inputs not based on observable market data The fair values of listed equity securities and listed collective investment schemes are determined by reference to Bursa Malaysia Securities Berhad and respective foreign stock exchanges of the respective countries’ bid prices at reporting date.

c. Financial instruments not carried at fair value and whose carrying amounts

are reasonable approximations of fair value

The carrying amounts of the Fund’s other financial assets and liabilities are not carried at fair value but approximate fair values due to the relatively short term maturity of these financial instruments.

18. CAPITAL MANAGEMENT

The capital of the Fund can vary depending on the demand for creation and cancellation of units to the Fund.

The Fund’s objectives for managing capital are:

a. To invest in investments meeting the description, risk exposure and expected

return indicated in its prospectus; b. To maintain sufficient liquidity to meet the expenses of the Fund, and to meet

cancellation requests as they arise; and c. To maintain sufficient fund size to make the operations of the Fund cost-efficient.

No changes were made to the capital management objectives, policies or processes during the current financial period.

19. COMPARATIVES

There are no comparative amounts presented as this is the Fund’s first set of financial statements since its commencement date.


17. FINANCIAL INSTRUMENTS (CONTD.)

b. Financial instruments that are carried at fair value (Contd.)

Level 1: Listed prices in active market Level 2: Model with all significant inputs which are observable market data Level 3: Model with inputs not based on observable market data The fair values of listed equity securities and listed collective investment schemes are determined by reference to Bursa Malaysia Securities Berhad and respective foreign stock exchanges of the respective countries’ bid prices at reporting date.

c. Financial instruments not carried at fair value and whose carrying amounts

are reasonable approximations of fair value

The carrying amounts of the Fund’s other financial assets and liabilities are not carried at fair value but approximate fair values due to the relatively short term maturity of these financial instruments.

18. CAPITAL MANAGEMENT

The capital of the Fund can vary depending on the demand for creation and cancellation of units to the Fund.

The Fund’s objectives for managing capital are:

a. To invest in investments meeting the description, risk exposure and expected

return indicated in its prospectus; b. To maintain sufficient liquidity to meet the expenses of the Fund, and to meet

cancellation requests as they arise; and c. To maintain sufficient fund size to make the operations of the Fund cost-efficient.

No changes were made to the capital management objectives, policies or processes during the current financial period.

19. COMPARATIVES

There are no comparative amounts presented as this is the Fund’s first set of financial statements since its commencement date.

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Investor Services CenterToll Free Line: 1 800 88 3737Fax: +603 2057 3722Email: [email protected]

Head Office, Kuala LumpurSuite 12.02, 12th Floor, Kenanga International, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia.Tel: 03-2057 3688 Fax: 03-2161 8807

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