WILMINGTON TRUST COLLECTIVE INVESTMENT TRUST MULTI-MANAGER LARGE CAP GROWTH FUND FINANCIAL STATEMENTS DECEMBER 31, 2017 INDEPENDENT AUDITOR'S REPORT

Transcription

1 WILMINGTON TRUST COLLECTIVE INVESTMENT TRUST MULTI-MANAGER LARGE CAP GROWTH FUND FINANCIAL STATEMENTS DECEMBER 31, 2017 WITH INDEPENDENT AUDITOR'S REPORT

2 MULTI-MANAGER LARGE CAP GROWTH FUND CONTENTS Independent Auditor's Report... 1 Statement of Assets and Liabilities... 3 Statement of Operations... 3 Statement of Changes in Net Assets... 4 Financial Highlights... 5 Schedule of Investments... 6 Notes to the Financial Statements... 11

3 INDEPENDENT AUDITOR'S REPORT Wilmington Trust, N.A, Trustee for Report on the Financial Statements We have audited the accompanying financial statements of (the "Fund") of (the "Trust"), which comprise the Statement of Assets and Liabilities, including the Schedule of Investments, as of, and the related Statements of Operations and Changes in Net Assets, and the Financial Highlights for the period from May 1, 2017 (date of inception) to, and the related Notes to the Financial Statements. These financial statements and Financial Highlights are hereinafter collectively referred to as financial statements. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we 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 the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements 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 entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, 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. Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Fund as of, and the results of its operations, and changes in its net assets and its financial highlights for the period from May 1, 2017 (date of inception) to, in accordance with accounting principles generally accepted in the United States of America. 1

4 Other Matter Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole. The supplementary information on investments purchased and sold for the period from May 1, 2017 (date of inception) to, following the Schedule of Investments, is presented for purposes of additional analysis and is not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole. Tulsa, Oklahoma April 30,

5

6 Statement of Assets and Liabilities Assets Investments in securities, at fair value (cost $67,641,750) $ 78,021,576 Cash and cash equivalents 20,202 Accrued interest and dividends 50,537 Receivable for reimbursement 43,083 Receivable for investment securities sold 1,926,435 Receivable for fund units sold 17,442 Total assets 80,079,275 Liabilities and Net Assets Payable for investment securities purchased 29,792 Payable for fund units redeemed 1,396 Accrued expenses 75,668 Total liabilities 106,856 Net assets $ 79,972,419 Statement of Operations For the period from May 1, 2017 (date of inception) to Investment income Dividends $ 296,582 Interest 4,938 Total investment income 301,520 Expenses Trustee, management and service provider fees 188,585 Professional fees and other operating expenses 30,868 Expense reimbursement from sub-advisor (140,023) Total expenses 79,430 Net investment income 222,090 Realized and unrealized gain (loss) on investments Net realized gain on investments 25,375,310 Net realized loss on foreign currency transactions (222) Net change in unrealized appreciation on investments 10,379,826 Net realized and unrealized gain on investments 35,754,914 Net increase in net assets resulting from operations $ 35,977,004 See Notes to the Financial Statements. 3

7 Increase (decrease) in net assets resulting from operations Net investment income $ 222,090 Net realized gain on investments 25,375,310 Net realized loss on foreign currency transactions (222) Net change in unrealized appreciation on investments 10,379,826 Net increase in net assets resulting from operations 35,977,004 Merger transactions (see Note 1) Class 0IM 101,747,855 Class 35 3,775,252 Class 45 57,025 Class ,519 Class R 2,253,315 Total proceeds from merger transactions 108,534,966 Fund unit transactions Proceeds from units issued Class 0IM 6,770,494 Class ,424 Class 45 2,297 Class ,317 Class R 97,249 Class R6 ^ 1,062,940 Total proceeds from units issued 8,614,721 Value of units redeemed Class 0IM (71,114,175) Class 35 (877,313) Class 60 (756,011) Class R (231,899) Class R6 ^ (174,874) Total value of units redeemed (73,154,272) Decrease in net assets resulting from fund unit transactions (64,539,551) Increase in net assets 79,972,419 Net assets, beginning of period - Net assets, end of period $ 79,972,419 ^Class R6 funded on 7/10/2017. Statement of Changes in Net Assets For the period from May 1, 2017 (date of inception) to See Notes to the Financial Statements. 4

8 Financial Highlights For the period from May 1, 2017 (date of inception) to Per Unit Operating Performance Class 0IM Class 35 Class 45 Net asset value, at inception $ $ $ Income (loss) from investment operations: Net investment income (loss) (1) 0.05 (0.04) (0.05) Net realized and unrealized gain on investments (1) Total income from investment operations Net asset value, end of period $ $ $ Total Return 15.43% ^ 14.98% ^ 14.83% ^ Supplemental Data Ratio to average net assets: Gross expenses (excluding reimbursement) 0.29% # 0.74% # 0.84% # Net expenses 0.08% # 0.74% # 0.84% # Net investment income (loss) 0.36% # (0.33%) # (0.44%) # Fund Unit Activity Units, beginning of period Issued 377,177 19, Merger transactions (see Note 1) 7,435, ,860 9,325 Redeemed (4,023,512) (50,326) - Units, end of period 3,789, ,102 9,454 Per Unit Operating Performance Class 60 Class R Class R6 Net asset value, at inception $ $ $ ^ Income (loss) from investment operations: Net investment income (loss) (1) (0.07) Net realized and unrealized gain on investments (1) Total income from investment operations Net asset value, end of period $ $ $ Total Return 13.14% ^ 15.13% ^ 10.15% ^ Supplemental Data Ratio to average net assets: Gross expenses (excluding reimbursement) 0.98% # 0.40% # 0.38% # Net expenses 0.98% # 0.40% # 0.38% # Net investment income (loss) (0.54%) # 0.00% # (0.02%) # Fund Unit Activity Units, beginning of period Issued 20,164 5,698 58,925 Merger transactions (see Note 1) 33, ,404 - Redeemed (43,465) (13,271) (9,402) Units, end of period 10, ,831 49,523 (1) Based on average units outstanding. ^Not annualized for periods less than one year. Class R6 funded on 7/10/2017. #Annualized. See Notes to the Financial Statements. 5

9 Schedule of Investments Principal Amount or Fair Shares Cost Value Collective Funds % BlackRock Russell 1000 Growth Fund F 300,085 $ 7,217,825 $ 7,462,417 Pioneer Large Cap Growth Portfolio 2,201,775 25,577,160 28,204,732 Total Collective Funds 32,794,985 35,667,149 Common Stocks % Basic Materials - 0.2% DowDuPont Inc ,833 21,936 Sherwin-Williams Company , ,275 Total Basic Materials 158, ,211 Communications % Alphabet, Inc. Class A , ,448 Alphabet, Inc. Class C 1, ,207 1,241,030 Amazon.com, Inc. 2,695 2,422,851 3,151,721 Facebook, Inc. Class A 11,975 1,476,782 2,113,109 Mercadolibre, Inc , ,914 Netflix, Inc. 1, , ,249 Priceline Group, Inc ,545,297 1,652,591 Symantec Corporation 1,640 49,363 46,018 Total Communications 7,049,969 9,300,080 Consumer, Cyclical - 5.7% Alaska Air Group, Inc. 2, , ,682 American Airlines Group, Inc. 8, , ,182 Aptiv PLC ,223 40,634 Costco Wholesale Corporation 1, , ,773 Delta Air Lines, Inc. 1,810 94, ,360 Dollar General Corporation 1, , ,235 Domino's Pizza, Inc. 1, , ,151 Ferrari NV ,830 73,283 Hilton Worldwide Holdings Inc. 1,117 68,707 89,204 Home Depot, Inc. 1, , ,896 Lowe's Companies, Inc ,896 17,659 Marriott International, Inc. Class A 2, , ,702 McDonald's Corporation , ,589 MGM Resorts International 60 1,859 2,003 Nike, Inc. Class B 8, , ,341 Norwegian Cruise Line Holdings Ltd ,474 22,898 O'Reilly Automotive, Inc. 14 3,813 3,368 Ross Stores, Inc. 2, , ,910 Royal Caribbean Cruises Ltd. 1, , ,311 Starbucks Corporation 7, , ,748 See Notes to the Financial Statements. 6

10 Schedule of Investments (continued) Principal Amount or Fair Shares Cost Value Common Stocks % (continued) Consumer, Cyclical - 5.7% (continued) Tapestry, Inc. 60 $ 2,590 $ 2,654 Tesla, Inc , ,111 TJX Companies, Inc. 80 6,089 6,117 Ulta Beauty, Inc. 1, , ,209 United Continental Holdings ,350 16,985 Yum! Brands, Inc. 3, , ,009 Total Consumer, Cyclical 4,152,557 4,584,014 Consumer, Non-cyclical % Aetna, Inc. 1, , ,860 Alexion Pharmaceuticals, Inc. 5, , ,148 Allergan PLC 10 2,455 1,636 Anthem, Inc , ,757 Becton Dickinson and Company 2, , ,037 Biogen, Inc , ,592 Bristol Myers Squibb Company 7, , ,380 Celgene Corporation 4, , ,188 Cigna Corporation 1, , ,975 Cintas Corporation ,484 51,268 Constellation Brands, Inc. Class A ,910 56,000 CoStar Group, Inc ,824 14,848 Danaher Corporation 3, , ,089 Edwards Lifesciences Corporation 3, , ,156 Fleetcor Technologies Inc ,054 92,559 Global Payments Inc. 2, , ,394 Humana Inc , ,626 IHS Markit Ltd. 90 3,978 4,064 Illumina Inc. 2, , ,434 INCYTE Corporation ,040 18,942 Intuitive Surgical Inc. 1, , ,377 Merck & Company, Inc. 60 3,852 3,376 Monster Beverage Corporation 6, , ,322 PayPal Holdings, Inc. 10, , ,881 Philip Morris International 1, , ,446 Regeneron Pharmaceuticals, Inc. 20 8,552 7,519 S&P Global Inc ,644 89,782 Stryker Corporation 2, , ,416 Thermo Fisher Scientific, Inc. 1, , ,124 UnitedHealth Group, Inc. 4, ,611 1,082,900 Worldpay Inc. Class A ,362 64,724 See Notes to the Financial Statements. 7

11 Schedule of Investments (continued) Principal Amount or Fair Shares Cost Value Common Stocks % (continued) Consumer, Non-cyclical % (continued) Vertex Pharmaceuticals Inc. 5,951 $ 787,049 $ 891,817 Zoetis, Inc ,334 26,078 Total Consumer, Non-cyclical 8,220,309 9,373,715 Energy - 0.4% Pioneer Natural Resources Company 1, , ,253 Financial - 6.8% American Express Company 30 2,786 2,979 Ameriprise Financial, Inc ,430 50,841 Charles Schwab Corporation 10, , ,464 Chubb Ltd ,041 23,089 Citigroup, Inc ,411 27,904 First Republic Bank California 3, , ,125 Intercontinental Exchange, Inc. 8, , ,526 JPMorgan Chase & Company 1, , ,175 Marsh & McLennan Companies, Inc ,541 47,857 Mastercard, Inc. Class A 4, , ,292 Morgan Stanley 12, , ,572 Progressive Corporation ,494 50,125 State Street Corporation 2, , ,023 TD Ameritrade Holding Corporation 8, , ,578 The Bank of New York Mellon Corporation ,743 23,429 Visa, Inc. Class A 11, ,660 1,354,216 Willis Towers Watson PLC 1, , ,103 Total Financial 4,463,855 5,475,298 Industrial - 2.8% Acuity Brands, Inc. 1, , ,632 Agilent Technologies, Inc ,210 12,724 Ball Corporation 130 5,485 4,921 Canadian Pacific Railway Ltd ,436 62,138 Cognex Corporation 4, , ,480 CSX Corporation ,102 29,155 Fedex Corporation 30 6,569 7,486 Fortive Corporation 2, , ,304 Harris Corporation ,318 62,043 Honeywell International, Inc. 1, , ,752 Northrop Grumman Corporation ,200 71,817 Raytheon Company 21 3,766 3,945 Roper Technologies Inc , ,019 See Notes to the Financial Statements. 8

12 Schedule of Investments (continued) Principal Amount or Fair Shares Cost Value Common Stocks % (continued) Industrial - 2.8% (continued) Stanley Black & Decker, Inc. 620 $ 90,434 $ 105,208 Textron Inc. 53 2,426 2,999 The Boeing Company 2, , ,273 Union Pacific Corporation 24 2,688 3,218 Total Industrial 1,775,721 2,219,114 Technology % Activision Blizzard, Inc. 8, , ,541 Adobe Systems, Inc. 2, , ,700 Analog Devices, Inc. 14 1,170 1,246 Apple Inc. 3, , ,966 Applied Materials, Inc. 8, , ,188 Broadcom Ltd. 1, , ,681 Electronic Arts, Inc. 1, , ,356 Fidelity National Information Services 1, , ,761 Fiserv, Inc. 1, , ,312 Intuit Inc. 1, , ,524 Lam Research Corporation 90 14,136 16,566 Microchip Technology Inc ,084 78,653 Microsoft Corporation 14, ,396 1,279,507 Nvidia Corporation 2, , ,647 Red Hat, Inc. 1, , ,452 Salesforce.com, Inc. 9, , ,821 ServiceNow, Inc. 6, , ,618 Splunk Inc. 5, , ,306 Tencent Holdings Ltd. 13, , ,944 Texas Instruments, Inc ,057 80,419 VMWare, Inc. Class A ,515 56,394 Workday Inc. Class A 1, , ,959 Xilinx, Inc ,072 9,776 Total Technology 6,676,039 8,462,337 Utilities - 0.1% Nextera Energy, Inc ,090 32,800 Sempra Energy ,852 23,522 Total Utilities 54,942 56,322 Total Common Stocks 32,822,002 39,956,344 Depositary Receipts - 2.8% Communications - 2.1% Alibaba Group Holding, Ltd. 9,121 1,193,859 1,572,734 Ctrip.com International, Ltd. 1,416 74,198 62,446 Total Communications 1,268,057 1,635,180 See Notes to the Financial Statements. 9

13 Schedule of Investments (continued) Principal Amount or Fair Shares Cost Value Depositary Receipts - 2.8% (continued) Consumer, Non-cyclical - 0.7% New Oriental Education & Technology Group Inc. 3,577 $ 294,710 $ 336,238 Shire PLC 1, , ,070 Total Consumer, Non-cyclical 582, ,308 Technology - 0.0% ASML Holding N.V ,283 29,549 Total Depositary Receipts 1,879,717 2,253,037 Money Market Fund - 0.2% State Street Institutional U.S. Government Money Market Fund 145, , ,046 Total Investments % $ 67,641,750 78,021,576 Other Assets in Excess of Liabilities - 2.4% 1,950,843 Net Assets - 100% $ 79,972,419 The following is a summary of the fair value of the investments in the Fund based on the inputs used to value them as of (see Note 3): Fair Value Measurements Level 1 Level 2 Level 3 Total Collective Funds measured at net asset value* $ - $ - $ - $ 35,667,149 Common Stocks 39,956, ,956,344 Depositary Receipts 2,253, ,253,037 Money Market Fund 145, ,046 Total $ 42,354,427 $ - $ - $ 78,021,576 *Certain investments that are measured at fair value using the net asset value per share (or its equivalent) as a practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Statement of Assets and Liabilities. During the period ended, the Fund did not hold any Level 3 securities. The Fund recognizes transfers between the fair value hierarchy levels as of the beginning of the fiscal year. There were no transfers between any of the fair value hierarchy levels during the period. Supplementary Information: Total investment purchases, sales proceeds, and realized gain for the period ended, were: Purchases Sales Realized at Cost Proceeds Gain Investments $ 316,614,048 $ 274,492,305 $ 25,375,310 See Notes to the Financial Statements. 10

14 Notes to the Financial Statements Note 1 Organization (the "Trust") is intended to constitute an exempt trust under Section 501(a) of the Internal Revenue Code of 1986, as amended, and a group trust within the meaning of Rev. Rul , as clarified and amended. The Trust is exempt from registration under the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended. Wilmington Trust, N.A. ("WTNA" or the "Trustee") is the Trustee of the Trust. The Trustee is responsible for maintaining and administering the Trust and its various funds and also serves as the investment adviser (the "Investment Adviser") to the funds. M&T Bank Corporation is the ultimate parent of the Trustee. State Street Bank and Trust Company provides custody and transfer agency services for the Trust and its funds. The purpose of the Trust is to allow collective investments by plan sponsors of retirement plans which qualify for exemption from federal income taxation pursuant to Section 501(a) of the Internal Revenue Code, as amended (the "Code"), by reason of qualifying under Section 401(a) of the Code; tax-exempt governmental plans under Section 414(d) or Section 818(a)(6) of the Code; eligible deferred compensation plans under Section 457(b) of the Code established by a government employer; group trusts or separate accounts consisting solely of assets of the foregoing; and other investors eligible for participation in the Trust. The Trust consists of separate investment funds with differing investment objectives, which are available for investment by participating plans. An eligible plan may join the Trust, subject to the Trustee's acceptance, and become a participating plan by executing participation documents specified by the Trustee. The (the "Fund") is one of the funds of the Trust. The Fund was created on May 1, 2017, when the Aggressive Growth Portfolio of the for Employee Benefit Plans was merged with and into the of the Trust. The Fund consists of two active sleeves and two passive index fund sleeves (the "sleeves"), each of which maintain its own separate investment guidelines and restrictions. The passive sleeves managed by Wilmington Trust, N.A. and BlackRock Institutional Trust Company, N.A. (the "Underlying Fund Managers") invest in Pioneer Large Cap Growth Portfolio and Russell 1000 Growth Fund F, respectively, which are collective investment funds. The investment objective of the Fund is to generate a total return in excess of the Russell 1000 Growth Index benchmark over a full market cycle. WTNA has engaged Columbia Management Investment Advisers, LLC as model portfolio provider for one of the active sleeves and T. Rowe Price Associates, Inc. as sub-advisor to the second active sleeve (the "Sub-Advisors") to provide investment advice and recommendations with respect to investment of the Fund's assets. While the Trustee generally relies on the Sub-Advisors to manage the Fund's assets, the Trustee maintains ultimate fiduciary authority over the management of and investments made in the Fund. The Sub-Advisors are engaged pursuant to a sub-advisory agreement. Note 2 Significant Accounting Policies The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The Fund is an investment company and follows the accounting and 11

15 Notes to the Financial Statements (continued) reporting guidance in Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic No Net Asset Value ("NAV") Units of each fee class of the Fund are valued each day on which the New York Stock Exchange ("NYSE") is open for trading in accordance with the valuation procedures established by the Trustee. The NAV per unit is calculated as of the close of trading on the NYSE (generally, 4:00 p.m. U.S. Eastern time). The NAV per unit is computed by dividing the total fair value of the assets of a Fund, less its liabilities, by the total number of units outstanding at the time of such computation. Investment income earned is reinvested in the Fund and included in the determination of unit values. Fund Unit Transactions The Fund sells new units and repurchases outstanding units on a daily basis. Unit purchases and redemptions are transacted at the NAV per fee class of the Fund determined as of the close of business each day. A summary of the Fund unit activity for the Fund is included with its Financial Highlights. The Fund requires the plan sponsor to provide a five-day written notice for withdrawals which will exceed $1 million or 10% of the assets invested in the Fund. Investment Valuation Investments are valued at their current fair value determined as follows: Investments in Collective Funds The Fund may hold investments in units of other funds within the Trust or similar funds for which other unrelated entities are trustee. The Trustee or unrelated trustee estimates the fair value of investments in collective funds that have calculated net asset value per unit in accordance with the specialized accounting guidance for investment companies. Accordingly, as a practical expedient, investments in other such funds are valued at their net asset value as reported by the investee funds. The Fund has the ability to redeem its investments in the collective funds at net asset value without restrictions. Where one fund invests in another fund within the Trust, the Trustee fee allocated to the investment by such investee fund is waived. Money Market Fund Investments in money market funds are valued at the daily closing net asset value of the respective fund. Securities Securities, other than bonds, listed on a securities exchange, market or automated quotation system for which quotations are readily available are valued at the closing price on the primary exchange or market on which they are traded on the day of valuation or, if there is no such reported sale on the valuation date, at the most recent bid quotation on the principal exchange. If a market price is not readily available or if such price is deemed unreliable, it will be valued at fair value in accordance with valuation procedures established by the Trustee. The Trustee's determination of fair value involves consideration of a number of subjective factors, and therefore, no single standard for determining fair value will apply. When the valuation methods described above are not reflective of fair value, investments are valued at fair value following procedures and/or guidelines determined by or under the direction of the valuation committee established by the Trustee. In light of the judgment involved in fair value decisions, there can be no assurance that a fair value assigned to a particular investment is accurate. Cash and Cash Equivalents The Fund considers all highly liquid instruments with original maturities of three months or less at the acquisition date to be cash equivalents. 12

16 Notes to the Financial Statements (continued) Investment Transactions and Investment Income The Fund records security transactions on a trade date basis. Dividend income is recorded on the ex-dividend date. Net realized gains and losses on investments are determined by the first-in, first-out method. Interest income and expenses are recorded daily on the accrual basis. Fee Classes and Allocations The Fund offers multiple fee classes. Not all fee classes are available for investment by all plans. Each class is allocated expenses on the basis of expense loads assigned to that class. Income, expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each fee class based on the units outstanding for the fee class in proportion to the total outstanding units. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Guarantees and Indemnifications Under the Fund's organizational documents, each trustee, officer, employee and agent of the Trust is indemnified, to the extent permitted by law, against certain liabilities that may arise in the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts that contain a variety of indemnification clauses. The Fund's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. However, the Fund has not had prior claims or losses pursuant to these contracts and the Trustee believes the risk of loss to be remote. Income Tax Status The Trust has received a determination from the Internal Revenue Service (the "IRS") that the Trust is exempt from federal income taxation under Section 501(a) of the Code. ASC , Accounting for Uncertainty in Income Taxes, provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. ASC requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Fund's tax returns to determine whether the tax positions are "more-likely-than-not" of being sustained by the applicable tax authority. Tax positions not deemed to meet the morelikely-than-not threshold are recorded as a tax expense. The Trustee has evaluated uncertain tax positions in the United States and all major foreign jurisdictions for all open tax years for the Fund since the Fund's inception and has determined that the Fund's tax positions are deemed to be "more-likely-than-not" as of. In the event that the Fund incurs any tax liabilities in the future, the tax liabilities and the corresponding tax expense will be recorded on the Statement of Assets and Liabilities and Statement of Operations, respectively. The Fund did not accrue any interest or penalties related to uncertain tax liabilities as of. The Trustee is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months. Subsequent Events The Trustee has evaluated the effect of subsequent events on the Fund's financial statements through April 30, 2018, which is the date the financial statements were available to be issued, and has determined that there are no material subsequent events, except as noted below, that would require disclosure or adjustment in the Fund's financial statements through this date. 13

17 Notes to the Financial Statements (continued) Subsequent to, with respect to the 0IM fee class, the Trustee has modified treatment of management fees for investments made by the Fund in Pioneer Large Cap Growth Portfolio, (the "Underlying Fund") that is purchased by the Fund on a net of fee basis. The Trustee has reimbursed the Fund for such fees indirectly paid by the Fund since inception in connection with the purchase of the Underlying Fund on a net of fee basis; the amount reimbursed was approximately 0.08 basis points of Fund net assets. The Fund continues to purchase units of the Underlying Fund on a net of fee basis. The Trustee reimburses the Fund quarterly in arrears. Note 3 Fair Value Measurements Fair value is defined as the price a fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. Various inputs are used in determining the fair value of the Fund's investments. The Trustee has performed an analysis of the significance and character of these inputs to the fair value determination. These inputs are summarized in the three broad levels listed below: Level 1 Quoted prices in active markets for identical investments. Level 2 Other significant observable inputs (including quoted prices for similar investments, published net asset values, interest rates, credit risk, and others). Level 3 Significant unobservable inputs (including the Trustee's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those investments. A summary of the inputs used as of, in valuing the Fund's assets carried at fair value is included in Note 2. The FASB issued Accounting Standards Update ("ASU") , Fair Value Measurement (Topic 820) - Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent). ASU removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the NAV per share as a practical expedient. ASU also removes the requirement to make certain disclosures for all investments that are eligible to be measured at fair value using the NAV per share as a practical expedient. Investments that calculate NAV per share (or its equivalent), but for which the practical expedient is not applied, will continue to be included in the fair value hierarchy along with the related required disclosures. The Fund adopted ASU and applied the changes to the, financial statements. The aggregate fair value of the investments in the Fund, by input level used as of, is included following the Fund's Schedule of Investments. 14

18 Notes to the Financial Statements (continued) Note 4 Fees and Expenses Trustee, Estimated Blended Sub-Advisory and Underlying Fund Management, and Service Provider Fees All asset-based fees are based upon the net assets as determined at the end of each preceding business day as set forth in the table below (in basis points). Except as otherwise noted, all asset-based fees are paid from the assets of the Fund. Fee Class Trustee Fee Estimated Blended Sub-Advisory and Underlying Fund Management Fees Service Provider Fee Class 0IM Class (1) 35 Class (1) 45 Class (1) 60 Class R (1) 0 Class R (1) 0 (1) Table shows fees on the first $50 million only. Certain Sub-Advisory fees are reduced when the Sub-Advisor sleeve value exceeds $50 million. Trustee Fee The Trustee receives an annual fee for trustee and administrative services provided to the Fund. Trustee fees, except as noted below with respect to Class 0IM, are based upon the average daily value of the Fund and are accrued daily, paid quarterly in arrears and charged against the assets invested in the Fund. Such Trustee fees for the period from May 1, 2017 (date of inception) to, are included in the Statement of Operations for the Fund. Plans invested in Class 0IM have agreed to pay external fees that are paid either by redemption of Fund units or paid directly by the plan sponsor. Portions of external fees are paid to the Sub-Advisors and Underlying Fund Manager for investment advisory services provided to the respective fund sleeve. External fees are based on the fair value as of the last business day of the previous month end and paid monthly in advance. Sub-Advisory and Underlying Fund Management Fees The Sub-Advisors and Underlying Fund Manager are compensated for their investment advisory services provided to the Fund. Management fees for each class, except as noted below with respect to Class 0IM, are based upon the average daily value of the Fund and are accrued daily, paid quarterly in arrears and charged against the assets invested in the Fund. Plans in Class 0IM (or their plan sponsors) paid a management fee to the Sub-Advisors and Managers of the underlying funds of 34 basis points based on the month-end values of the fund. These fees are not reflected in the Fund's expense ratio. For Class 0IM, the actual expense ratio including management fees incurred would be 42 basis points. Service Provider Fee Service provider fees, if any, are used to compensate other service providers to the Fund, including brokers and financial intermediaries and other parties providing services to retirement plans participating in 15

19 Notes to the Financial Statements (continued) the Fund. Service provider fees may also be paid to plan service providers, such as third-party administrators and record keepers that provide sub-transfer agency, recordkeeping and other administrative services to participating plans invested in the Fund. Operating Expenses In addition to the fees described above, the Fund bears expenses related to its operation, including, but not limited to, audit, custody, tax and legal services. Expenses incurred in connection with the investment and reinvestment of Fund assets, including, without limitation, transfer agency fees, brokerage commission and other expenses, are also charged against the Fund. When assets of the Fund are invested in other investment vehicles, such as other collective funds or Exchange- Traded Funds, those investment vehicles will incur fees and expenses, which will be reflected in the operating results and value of the Fund's investment in such investment vehicle, and are separate and distinct from the fees and expenses of the Fund described above. Note 5 Related Party Transactions The Trustee is a national bank that provides trust and custodial services for tax-advantaged retirement plans as well as trust and investment services to business pension and retirement plans. The Trustee is responsible for managing the Trust's investment and business affairs. Note 6 Risks Associated with Investing in the Fund In the normal course of business, the Fund trades financial instruments and enters into financial transactions where risk of potential loss exists due to changes in the fair value of the investments. The principal risks associated with investing in the Fund are: Growth Investing. Growth securities may be subject to increased volatility as the value of these securities is highly sensitive to market fluctuations and future earnings expectations. These securities typically trade at higher multiples of current earnings than do other securities and may lose value if it appears their earnings expectations may not be met. Industry and Sector Investing. Concentrating assets in a particular industry, sector of the economy, or markets may increase volatility because the investment will be more susceptible to the impact of market, economic, regulatory, and other factors affecting that industry or sector compared with a more broadly diversified asset allocation. Issuer. A stake in any individual security is subject to the risk that the issuer of that security performs poorly, resulting in a decline in the security's value. Issuer-related declines may be caused by poor management decisions, competitive pressures, technological breakthroughs, reliance on suppliers, labor problems or shortages, corporate restructurings, fraudulent disclosures, or other factors. Additionally, certain issuers may be more sensitive to adverse issuer, political, regulatory, market, or economic developments. Management. Performance is subject to the risk that the sub-advisor's asset allocation and investment strategies do not perform as expected, which may cause the Fund to underperform its benchmark, other 16

20 Notes to the Financial Statements (continued) investments with similar objectives, or the market in general. The investment is subject to the risk of loss of income and capital invested, and the sub-advisor does not guarantee its value, performance, or any particular rate of return. Market/Market Volatility. The market value of the Fund's securities may fall rapidly or unpredictably because of changing economic, political, or market conditions, which may reduce the value of the Fund. Multi-Manager. Multi-Manager Funds consist of multiple specialized "sleeves," each holding investments recommended by different sub-advisors. The sleeves' individual investing styles may not complement each other. This can result in both higher portfolio turnover and enhanced or reduced concentration in a particular region, country, industry, or investing style compared with an investment in a single sub-advised fund. Portfolio Diversification. Investments that concentrate their assets in a relatively small number of issuers, or in the securities of issuers in a particular market, industry, sector, country, or asset class, may be subject to greater risk of loss than is a more widely diversified investment. 17