Brookfield Investment Management

Transcription

1 Brookfield Investment Management 2014 Annual Financial Statements For the period from January 1, 2014 to December 31, 2014

2 Management s Responsibility for the Financial Statements The accompanying financial statements of (the Fund ) are the responsibility of the management of the Fund. Brookfield Investment Management (Canada) Inc., is the manager (the Manager ) of the Fund. To fulfill these responsibilities, the Manager m aintains policies, procedures and systems of internal control to ensure that it s reporting practices and accounting and administrative procedures are appropriate. These policies and procedures are designed to provide a high degree of assurance that relevant and reliable financial information is produced. These financial statements have been prepared in accordance with International Financial Reporting Standards, and where appropriate, reflect Management s best estimates and judgments. The Manager is responsible for the information and representations contained in these Annual Financial Statements and the Annual Management Report of Fund Performance. The Manager is also responsible for the selection of the accounting principles that are most appropriate for the Fund s circumstances. The Manager, on behalf of the unitholders, has appointed the external firm Deloitte LLP as the independent auditor of the Fund. The auditors have examined the financial statements in accordance with auditing standards generally accepted in Canada to enable them to express to the unitholders their opinion on the financial statements. The auditor s report outlines the scope of their audit and their opinion of the financial statements. Gail Cecil President Jonathan Tyras Chief Financial Officer 2014 Annual Financial Statements 1

3 Independent Auditor s Report To the Unitholders of We have audited the accompanying financial statements of, which comprise the statements of financial position as at December 31, 2014, December 31, 2013 and January 1, 2013, and the statements of comprehensive income, statements of changes in net assets attributable to holders of redeemable units and statements of cash flows for the years ended December 31, 2014 and December 31, 2013, and a summary of significant accounting policies and other explanatory information. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation 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 audits. We conducted our audits in accordance with Canadian generally accepted auditing standards. 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 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. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of 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 in our audits is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements present fairly, in all material respects, the financial position of as at December 31, 2014, December 31, 2013 and January 1, 2013, and its financial performance, its changes in net assets attributable to holders of redeemable units and its cash flows for the years ended December 31, 2014 and December 31, 2013 in accordance with International Financial Reporting Standards. Chartered Professional Accountants, Chartered Accountants Licensed Public Accountants March 30, Annual Financial Statements 2

4 Statements of Financial Position As at December 31, 2014, December 31, 2013, and January 1, 2013 (Expressed in Canadian Dollars) As at As at As at December 31, 2014 December 31, 2013 January 1, 2013 $ $ $ Assets Current assets Financial assets at fair value through profit or loss 164,242, ,492, ,569,111 Cash and cash equivalents 4,305,788 4,289,707 10,128,074 Collateral cash 21,670,894 3,474,362 Accrued investment income 2,446,465 1,965,277 2,108,051 Total assets 192,665, ,221, ,805,236 Liabilities Current liabilities Unrealized depreciation on forward currency contracts 6,726,461 Swap contracts 5,328,662 38,714 Margin payable (Note 7) 29,646,663 30,713,699 2,374,891 Due to broker 2,148,244 Accounts payable and accrued liabilities 188, ,536 99,791 Total liabilities (excluding net assets attributable to holders of redeemable units) 41,890,500 30,924,949 4,622,926 Net assets attributable to holders of redeemable units 150,774, ,296, ,182,310 Number of redeemable units outstanding (Note 11) 9,250,072 10,410,885 11,268,811 Net assets attributable to holders of redeemable units per unit See accompanying notes to financial statements. Approved on behalf of the Manager, Brookfield Investment Management (Canada) Inc. Gail Cecil Director Jonathan Tyras Director 2014 Annual Financial Statements 3

5 Statements of Comprehensive Income For the twelve months ended December 31, (Expressed in Canadian Dollars) $ $ Income Interest income for distribution purposes 10,604,187 12,246,455 Dividend income 3,980,427 1,687,055 Net realized foreign exchange (loss) gain (2,636,707) 808,011 Net realized gain on sale of investments 19,038,350 10,834,373 Net realized gain on forward currency contracts 2,541, ,291 Net realized gain on swap contracts 1,283,530 36,783 Net change in unrealized appreciation (depreciation) on foreign exchange 744,395 (2,870,789) Net change in unrealized depreciation on forward contracts (6,726,461) - Net change in unrealized depreciation on swap contracts (5,289,948) (38,714) Net change in unrealized (depreciation) appreciation on investments (18,245,056) 14,784,867 Total income 5,293,717 37,958,332 Expenses (Note 9) M anagement fees 611, ,060 Interest expense 331, ,710 Brokerage commissions and other charges 153,054 91,524 Audit fees 26,609 26,962 Legal fees 8,519 14,870 Other expenses 92,834 86,813 Total expenses 1,224, ,939 Operating profit 4,068,997 37,010,393 Withholding taxes (180,566) (16,243) Increase in net assets attributable to holders of redeemable units 3,888,431 36,994,150 Increase in net assets attributable to holders of redeemable units per unit See accompanying notes to financial statements Annual Financial Statements 4

6 Statements of Changes in Net Assets Attributable to Holders of Redeemable Units For the twelve months ended December 31, (Expressed in Canadian Dollars) $ $ Net assets attributable to holders of redeemable units, beginning of period 167,296, ,182,310 Increase in net assets attributable to holders of redeemable units 3,888,431 36,994,150 Redeemable unit transactions Amounts received from reinvestment of distributions of units 3,842,356 38,714,383 Amounts paid for redemption of units (20,410,000) (11,880,000) Net decrease from redeemable unit transactions (16,567,644) 26,834,383 Distributions to holders of redeemable units Return of net investment income (3,842,356) (38,714,383) Total distributions to holders of redeemable units (3,842,356) (38,714,383) Net (decrease) increase in net assets attributable to holders of redeemable units (16,521,569) 25,114,150 Net assets attributable to holders of redeemable units, end of period 150,774, ,296,460 See accompanying notes to financial statements Annual Financial Statements 5

7 Statements of Cash Flows For the twelve months ended December 31, (Expressed in Canadian Dollars) $ $ Cash flows provided by (used for): Cash flows from operating activities Increase in net assets attributable to holders of redeemable units 3,888,431 36,994,150 Adjustments for: Interest income for distribution purposes (10,604,187) (12,246,455) Dividend income, net of withholding taxes (3,799,861) (1,670,812) Net realized gain on sale of investments (19,038,350) (10,834,373) Change in unrealized depreciation (appreciation) on investments 18,245,056 (14,784,867) Change in unrealized depreciation on forward currency contracts 6,726,461 - Change in unrealized depreciation on swap contracts 5,289,948 38,714 (Increase) in collateral cash (18,196,532) (3,474,362) Decrease in accounts payable and accrued liabilities 16,178 72,745 Interest received 10,245,255 12,389,229 Dividend received, net of withholding taxes 3,677,605 1,670,812 Proceeds from sale of investments 156,548,308 99,973,058 Amounts paid for purchase of investments (131,505,195) (130,425,014) Net cash from (used in) operating activities 21,493,117 (22,297,175) Cash flows from financing activities M argin payable, net borrowings (repayments) and foreign exchange (1,067,036) 28,338,808 Amounts paid for redemption of units (20,410,000) (11,880,000) Net cash (used in) from financing activities (21,477,036) 16,458,808 Net increase (decrease) in cash and cash equivalents 16,081 (5,838,367) Cash and cash equivalents, beginning of the period 4,289,707 10,128,074 Cash and cash equivalents, end of the period $ 4,305,788 $ 4,289,707 See accompanying notes to financial statements Annual Financial Statements 6

8 Schedule of Investments As at December 31, 2014 ( Expressed in Canadian Dollars) Bonds Average Cost Fair Value % of Net Quantity Security $ $ Assets United States Dollar Denominated 6,780,000 Arch Coal Inc % 01OCT20 5,401,008 2,552, ,271,000 Banco do Brasil SA 9.000% 31DEC49 6,735,169 6,754, ,000 Bill Barrett Corp % 01OCT19 448, , ,500,000 BlackBerry Ltd % 13NOV20 5,724,694 9,064, ,048,000 Bonanza Creek Energy Inc % 15APR21 1,032,660 1,068, ,400,000 Empresas ICA SAB de CV 8.875% 29M AY24 4,851,285 4,681, ,639,000 EV Energy Partners, L.P % 15APR19 4,586,743 4,567, ,764,000 First Data Corp % 15AUG2021 7,032,513 7,660, ,400,000 Forbes Energy Services Ltd % 15JUN19 7,251,723 5,056, ,142,000 Hexion US Finance Corp % 01FEB18 2,101,390 2,208, ,682,000 Hexion US Finance Corp % 15NOV20 8,972,950 7,190, ,200,000 Just Energy Group Inc % 29JUL19 2,181,399 2,357, ,736,000 Lightstream Resources Ltd % 01FEB20 11,105,468 9,549, ,755,000 M BIA Inc % 15DEC25 4,078,876 5,755, ,509,000 M EG Energy Corp % 30JAN23 1,386,723 1,559, ,006,000 M EG Energy Corp % 15M AR21 1,047,759 1,063, ,005,000 M EG Energy Corp % 31M AR24 1,056,483 1,070, ,095,000 New Albertsons Inc % 01AUG29 1,115,981 1,135, ,518,000 New Albertsons Inc % 15JUN26 1,614,184 1,573, ,000 New Albertsons Inc % 01M AY31 472, , ,000 New Albertsons Inc % 01M AY30 1,062,905 1,097, ,434,000 Niska Gas Storage Canada ULC 6.500% 01APR19 10,044,755 8,222, ,000,000 Texas Competitive Electric Holdings LLC % 4,615,470 4,097, OCT20 93,920,979 89,235, Canadian Dollar Denominated 7,700,000 Imperial M etals Corp % 01JAN49 7,700,000 8,115, ,000 Just Energy Group Inc % 30SEP18 70,866 73, ,098,000 Just Energy Group Inc % 30JUN17 4,304,644 4,489, ,810,000 Perpetual Energy Inc % 23JUL19 4,854,209 4,585, ,929,719 17,264, Brazilian Real Denominated 3,020,000 Cia de Eletricidade do Estado da Bahia % 1,788,389 1,259, APR16 1,788,389 1,259, Annual Financial Statements 7

9 Equities United States Dollar Denominated 28,343 BP PLC, ADR 1,236,849 1,251, ,300 General M otors Co. 3,774,269 3,974, ,450 HSBC Holdings PLC, ADR 5,035,743 5,002, ,700 JPM organ Chase & Co. 3,258,372 3,892, ,000 Royal Dutch Shell PLC 5,223,922 5,478, ,775 Vector Group Ltd. 577, , ,106,225 20,236, British Pound Denominated 601,730 Aberdeen Asset M anagement PLC 4,925,176 4,696, ,000 British American Tobacco PLC 5,631,476 6,700, ,000 Unilever PLC 5,152,787 6,170, ,709,439 17,567, Canadian Dollar Denominated 693,135 AGF M anagement Ltd. Class B 7,410,039 5,884, ,000 Canadian Oil Sands Ltd. 1,198, , ,608,189 6,530, Hong Kong Dollar Denominated 1,765,300 COSCO Pacific Ltd. 2,611,494 2,905, ,611,494 2,905, Term Loans United States Dollar Denominated 10,019,666 SuperM edia Inc % 31DEC16 7,237,757 9,243, ,237,757 9,243, Transaction costs (117,524) Total investments 165,794, ,242, Accrued investment income 2,446, Cash and cash equivalents 4,305, Collateral cash 21,670, Derivative instruments (see schedule of derivative instruments) (12,055,123) (8.00) Liabilities, net of other assets (29,835,377) (19.79) Total net assets 150,774, See accompanying notes to financial statements Annual Financial Statements 8

10 Schedule of Derivative Instruments As at December 31, 2014 (Expressed in Canadian Dollars) Swap Contracts Number of Settlement Notional Unrealized Losses Underlying Asset Counterparty Shares Date Value $ Banco do Brasil S.A. J.P. M organ 225, Jul-15 2,990,189 (616,446) CCR S.A. J.P. M organ 160, Jul-15 1,536,882 (458,127) EV Energy Partners LP J.P. M organ 186, Nov-15 8,519,667 (4,171,589) M ark West Energy Partners LP J.P. M organ 85, Jul-15 6,758,688 (82,500) Total swap contracts (5,328,662) Unrealized Maturity Gains /(Losses) Forward Currency Contracts Date $ Buy CAD 11,279,693, Sell GBP 6,200,000 5-Jan-15 81,673 Buy CAD 1,088,100, Sell GBP 600,000 5-Jan-15 4,421 Buy CAD 85,764,000, Sell USD 80,000,000 5-Jan-15 (6,904,093) Buy GBP 150,000, Sell CAD 271,903 5-Jan-15 (983) Buy GBP 450,000, Sell CAD 818,505 5-Jan-15 (5,746) Buy USD 6,600,000 Sell CAD 7,547,100 5-Jan-15 98,267 Total forward currency contracts See accompanying notes to financial statements. (6,726,461) 2014 Annual Financial Statements 9

11 Notes to the Annual Financial Statements 1. THE FUND (the Fund ) is an investment fund established under the laws of the Province of Ontario pursuant to a Declaration of Trust dated March 1, The Fund began operations on April 1, 2011 when it issued 12,910,000 units (the Uni ts ) at $10.00 for gross proceeds of $129,100,000. The investment objective of the Fund is to provide holders of the Units ( Unitholders ) with the opportunity to preserve the net asset value of the Fund by investing in a portfolio (the Portfolio ) which focuses on, but is not limited to, investments in high yield corporate debt, and publicly-listed securities in infrastructure and real estate companies, across a global universe. Brookfield Investment Management (Canada) Inc. ( BIM Canada ) is the manager (the Manager ) and investment manager (the Investment Manager ) of the Fund. The Investment Manager makes all of the investment and trading decisions on behalf of the Fund. Pursuant to the terms of the declaration of trust, BIM Canada replaced Caledon Trust Company as trustee of the Fund effective June 1, BIM Canada does not receive any fees for providing this service. The Fund s registered office is Brookfield Place, 181 Bay Street, Suite 300 Toronto, Ontario Canada M5J 2T3. These financial statements were authorized for issue by the Manager on March 30, BASIS OF PRESENTATION AND ADOPTION OF IFRS These financial statements have been prepared in compliance with International Financial Reporting Standards ("IFRS"). The Fund adopted this basis of accounting in 2014 as required by Canadian securities legislation and the Canadian Accounting Standards Board. Previously, the Fund prepared its financial statements in accordance with Canadian generally accepted accounting principles as defined in Part V of the Chartered Professional Accountants of Canada Handbook ("Canadian GAAP"). The Fund has consistently applied the accounting policies used in the preparation of its opening IFRS statement of financial position at January 1, 2013 and throughout all periods presented, as if these policies had always been in effect. The financial statements have been prepared on the historical cost basis, except for the revaluation of certain financial instruments. Historical cost is generally based on the fair value of the consideration given in exchange for assets. Note 14 discloses the impact of the transition to IFRS on the Fund's reported financial position, financial performance and cash flows, including the nature and effect of significant changes in accounting policies from those used in the Fund's financial statements for the year ended December 31, 2013 which were prepared under Canadian GAAP. In applying IFRS, management makes estimates and assumptions that may affect the amounts of assets, liabilities, income and expenses reported in these financial statements. The most significant estimates relate to the valuation of investments. Actual results may differ from the estimates. 3. SIGNIFICANT ACCOUNTING POLICIES Financial Instruments The Fund s investments in equity and fixed income securities are designated at fair value through profit or loss ( FVTPL ) at inception. The Fund s derivatives are categorized as held for trading. As a result of such designation and categorization, the Fund s investments and derivatives are measured at FVTPL. The Fund s accounting policies for measuring the fair value of its investments and derivatives are identical to those used in measuring its published Net Asset Value (NAV) Annual Financial Statements 10

12 Offsetting Financial assets and liabilities are offset and the net amount presented in the Statements of Financial Position only when the Fund has a legal right to offset the amounts and intends either to settle on a net basis or to realize the asset and settle the liability simultaneously. In the normal course of business, the Fund enters into various master netting agreements or similar agreements that do not meet the criteria for offsetting in the Statements of Financial Position but still allow for the related amounts to be offset in certain circumstances, such as bankruptcy or termination of contracts. Fair Value Measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of financial assets and liabilities traded in active markets (such as publicly traded marketable securities) are based on quoted market prices at the close of trading on the reporting date. However, if (i) a fair value or price is not readily available, (ii) the available quotations are not believed to be reflective of fair value by the Investment Manager, or (iii) a significant event has occurred that would materially affect the value of the security, the security is fair valued, as determined in good faith, by the Fund s Valuation Committee. The Fund s Valuation Committee is comprised of senior members of Brookfield Investment Management Inc. s management team. The price determined by the Valuation Committee is an estimate and may differ from the actual price used in a purchase or sale transaction. The Fund s policy is to recognize transfers into and out of the fair value hierarchy levels as of the date of the event or change in circumstances giving rise to the transfer. The fair value of financial assets and liabilities that are not traded in an active market including overthe-counter derivatives, is determined using established valuation procedures. The Fund uses a variety of methods and makes assumptions that are based on market conditions existing at each measurement date. Valuation techniques include the use of comparable recent arm s length transactions, reference to other instruments that are substantially the same and others commonly used by market participants and which make the maximum use of observable inputs. Refer to Note 6 for further information about the Fund s fair value measurements. All investment transactions are accounted for on the trade date. Realized gains and losses from investment transactions and unrealized appreciation or depreciation in the value of investments are calculated on an average cost basis, excluding transaction costs and the effect of foreign exchange fluctuations, which are disclosed separately. Other assets and liabilities For the purpose of categorization, accrued investment income is recorded at cost or amortized cost. Similarly, margin payable, payables for securities purchased, distributions payable and accounts payable and accrued liabilities are deemed to be other financial liabilities and reported at amortized cost. All other financial assets and liabilities are measured at amortized cost. Under this method, financial assets and liabilities reflect the amounts required to be received or paid, discounted when appropriate, at the financial instrument s effective interest rate. The fair values of the Fund s financial assets and liabilities that are not carried at FVTPL approximate their carrying amounts due to their short-term nature. Revenue recognition Dividend income is recognized on the ex-dividend date and the interest for distribution purposes shown on the Statements of Comprehensive Income represents the coupon interest received by the Fund accounted for on an accrual basis. The Fund does not amortize premiums paid or discounts received on the purchase of fixed income securities except for zero coupon bonds which are amortized on a straight line basis. Transaction costs Transaction costs, such as brokerage commissions incurred in the purchase and sale of securities by the Fund, are expensed and are included in operating expenses in the Statements of Comprehensive 2014 Annual Financial Statements 11

13 Income. Transaction costs are incremental costs that are directly attributable to the acquisition, issue or disposal of an investment, which include fees and commissions paid to agents, advisors, brokers and dealers, levies by regulatory agencies and securities exchanges, and transfer taxes and duties. Functional and presentation currency The performance of the Fund is measured and reported to investors in Canadian dollars. The Manager considers the Canadian dollar as the currency that most faithfully represents the economic effects of the underlying transactions, event and conditions. These financial statements are presented in Canadian dollars, which is the Fund s functional currency. Foreign currency translation Investments and other assets denominated in foreign currencies are translated into Canadian dollars using the rate of exchange prevailing on the trade date. Investment transactions and income and expenses are translated at the rate of exchange on the date of such transactions. The fair values of investments and other assets and liabilities in foreign currencies are translated at the period-end exchange rates. Forward currency contracts Forward currency contracts, if applicable, are valued at current market value on each valuation date. The value is determined as the gain or loss that would be realized, if on the valuation date, the position of the forward currency contracts were closed out. Redeemable Units The Fund s redeemable Units are classified as financial liabilities. Distributions to holders of redeemable Units are recognized in Statements of Changes in Net Assets Attributable to Holders of Redeemable Units when they are authorized. New standards and interpretations not yet adopted: The final version of IFRS 9, Financial Instruments was issued by the International Accounting Standards Board in July 2014 and will replace IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 introduces a model for classification and measurement, a single, forward-looking expected loss impairment model and a substantially reformed approach to hedge accounting. The new single, principle based approach for determining the classification of financial assets is driven by cash flow characteristics and the business model in which an asset is held. The new model also results in a single impairment model being applied to all financial instruments, which will require more timely recognition of expected credit losses. It also includes changes in respect of own credit risk in measuring liabilities elected to be measured at fair value, so that gains caused by the deterioration of an entity s own credit risk on such liabilities are no longer recognized in profit or loss. IFRS 9 is effective for annual periods beginning on or after January 1, 2018, however is available for early adoption. In addition, the own credit changes can be early applied in isolation without otherwise changing the accounting for financial instruments. The Fund is in the process of assessing the impact of IFRS 9 and has not yet determined when it will adopt the new standard. 4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of financial statements in conformity with IFRS requires the Manager to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognized in the period in which the estimates are revised and in any future period affected Annual Financial Statements 12

14 Fair Value Measurement of Derivatives and Securities Not Quoted in an Active Market The Fund may hold financial instruments that are not quoted in active markets. Fair values of such instruments are determined using valuation techniques and may be determined using reputable pricing sources (such as pricing agencies) or indicative prices from market markers. Broker quotes as obtained from the pricing sources may be indicative and not executable or binding. 5. MANAGEMENT OF FINANCIAL RISKS The Fund is exposed to various financial risks, including market risk (consisting of currency risk, interest rate risk, and other price risk), credit risk and liquidity risk. The Fund s overall risk management programme seeks to minimize potentially adverse effects of those risks on the Fund s financial performance by employing experienced portfolio managers and by continuous monitoring of the Fund s securities positions and markets. The Manager maintains a corporate governance structure that oversees the Fund s investment activities. The Fund may use derivative financial instruments to mitigate certain risk exposures. Currency risk Currency risk is the risk that the value of an investment will change due to fluctuations in foreign exchange rates. The Fund s net assets attributable to holders of redeemable units are measured in Canadian dollars and payments to Unitholders are made in Canadian dollars. The Fund is exposed to currency risks as it may hold assets or have liabilities denominated in currencies other than in Canadian dollars. As at December 31, 2014, December 31, 2013 and January 1, 2013, the Fund was exposed to currency risk as the value of any assets or liabilities denominated in currencies other than the Canadian dollar will vary due to changes in foreign exchange rates. Currency risks of the Fund can be mitigated with the use of forward currency contracts. The following tables summarize the Fund s exposure to currency risks, as at December 31, 2014, December 31, 2013 and January 1, 2013: December 31, 2014 Investments Cash Other Net Assets/ (Liabilities)* Derivative Instruments** Total Net Asset $ $ $ $ $ % U.S. Dollar 118,714, ,359 (6,022,506) (88,181,862) 25,099, British Pound 17,567,097 54, ,256 (11,197,994) 6,545, Hong Kong Dollar 2,905,562 2,905, Brazilian Real 1,259,973 27,058 3,452,498 4,739, Total 140,447, ,442 (5,873,192) (95,927,358) 39,290, *Other Net Assets includes borrowings of $29,646,663. **Includes notional exposure from derivative positions. December 31, 2013 Investments Cash Other Net Assets/ (Liabilities)* Derivative Instruments** Total Net Asset $ $ $ $ $ % U.S. Dollar 142,580,303 4,030,566 (12,128,832) (44,822) 134,437, British Pound 14,145,195 52,180 (13,261,303) 936, Brazilian Real 864,678 18,521 2,963,084 3,846, Total 157,590,176 4,082,746 (25,371,614) 2,918, ,219, *Other Net Assets includes borrowings of $30,713,699. **Includes notional exposure from derivative positions Annual Financial Statements 13

15 January 1, 2013 Investments Cash Other Net Assets/ (Liabilities)* Derivative Instruments Total Net Asset $ $ $ $ $ % U.S. Dollar 109,510,422 9,943,781 (299,943) 119,154, British Pound 2,911, (2,384,943) 527, Brazilian Real 1,031,489 20,208 1,051, Total 113,453,356 9,944,561 (2,664,678) 120,733, *Other Net Assets includes borrowings of $2,374,891. As at December 31, 2014, had the Canadian dollar strengthened or weakened by 1% against each of the other currencies with all other variables remaining constant, net assets of the Fund would have decreased or increased by $392,902 (December 31, $1,392,196; January 1, $1,207,332). As at December 31, 2014, the Fund had entered into forward currency contracts with a net unrealized loss of $6,726,461 to deliver currencies at specified future dates. For further information regarding forward currency contracts, see the Schedule of Derivative Instruments. There were no such contracts outstanding as at December 31, 2013 and January 1, Interest rate risk Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or fair values of financial instruments. The Fund is exposed to interest rate risk from its holdings of fixed-rate debt instruments, the values of which fluctuate due to changes in prevailing levels of market interest rates. As at December 31, 2014, the Fund s debt instruments remaining terms to maturity were as follows: Debt Instruments $ % of Net Assets Less than 1 year 1 to 3 years 14,992, to 5 years 27,548, Greater than 5 years 74,461, Total 117,002, As at December 31, 2013, the Fund s debt instruments remaining terms to maturity were as follows: Debt Instruments $ % of Net Assets Less than 1 year 1 to 3 years 9,734, to 5 years 14,774, Greater than 5 years 119,341, Total 143,850, Annual Financial Statements 14

16 As at January 1, 2013, the Fund s debt instruments remaining terms to maturity were as follows: Debt Instruments $ % of Net Assets Less than 1 year 1 to 3 years 4,489, to 5 years 19,836, Greater than 5 years 96,011, Total 120,337, Interest rate risk of the Fund is currently mitigated by the relatively short duration and high credit spread of the high yield bonds and loans in the Portfolio. These characteristics make the Portfolio s sensitivity to interest rate risk relatively less than what would be experienced by a portfolio with longer duration investments that trade at tighter spreads to government-backed fixed income securities. It would also be possible to hedge interest rate risk by shorting government-backed fixed income securities or engaging in various interest rate derivatives. As at December 31, 2014, December 31, 2013 and January 1, 2013, the Fund had no such hedges in place. At December 31, 2014, if the prevailing interest rates had risen or declined by 0.25%, assuming a parallel shift in the yield curve, with all other variables held constant, the Fund s net assets attributable to holders of redeemable units would have decreased or increased, respectively, by approximately $1,044,250 (December 31, $1,254,772; January 1, 2013 $1,297,319). The Fund s sensitivity to interest rate changes was estimated using the weighted average duration of the bonds. In practice, the actual results may differ from this sensitivity analysis and the differences could be material. Other price risk Other price risk is the risk that the value of financial instruments will fluctuate as a result of changes in market prices (other than those arising from interest rate risk or currency risk). Such changes may be the result of factors affecting multiple instruments traded in a market, market segment or asset class. The Fund is exposed to other price risk in the Portfolio. The Fund may take outright long or short positions in any of its investments, which may include derivative instruments for purposes consistent with its investment objectives and investment strategy and subject to its investment restrictions. As at December 31, 2014 and December 31, 2013, the Fund had direct exposure to derivatives through its holdings in equity total return swaps and as at December 31, 2014, through forward currency contracts. As at January 1, 2013 the fund had no direct exposure to derivatives. Please refer to Schedule of Derivative Investments which shows the underlying notional equity exposure. All investments present a risk of loss of capital. The Manager seeks to mitigates this risk through careful selection of securities and other financial instruments. As at December 31, 2014, had the market increased or decreased by 5% with all other variables remaining constant, the net assets of the Fund would have increased or decreased by $8,212,112 (December 31, $9,424,603; January 1, 2013 $6,728,456).As at December 31, 2014, December 31, 2013 and January 1, 2013, the Fund had no securities sold short. Credit risk Credit risk is the risk of non-payment of scheduled interest and/or principal payments. The Fund is exposed to several types of credit risks including the risk that one or more investments in the Portfolio will decline in price, or fail to pay interest or principal when due, because the issuer of the security experiences a decline in its financial status. As at December 31, 2014, the maximum exposure to any one debt issuer in the Portfolio was $9,549,255 (December 31, $13,457,840; 2014 Annual Financial Statements 15

17 January 1, $10,893,158) representing 6.33% (December 31, %; January 1, %) of net assets attributable to holders of redeemable units. The performance of the Fund is also subject to general economic and specific industry conditions that could impact the fair value of one or more debt securities in the Portfolio. Securities with lower ratings tend to be more sensitive to these kinds of risks. As at December 31, 2014, December 31, 2013 and January 1, 2013, the Fund was invested in debt securities with the following credit ratings. The following chart was consolidated for comparative purposes: Debt Instruments by S&P Rating* December 31, 2014 December 31, 2013 January 1, 2013 % of Net Assets Total $ % of Net Assets Total $ % of Net Assets Total $ A ,755,325 BBB ,259, ,821, ,370,842 BB ,449, ,883,386 B ,622, ,820, ,810,485 CCC ,718, ,636, ,188,554 Not rated** ,197, ,688, ,967,779 Total ,002, ,850, ,337,660 * Or, if not rated by S&P, the most closely comparable rating from Moody s Investors Service ** Not rated by Standard & Poor s or Moody s Investors Service The Manager seeks to mitigate the above credit risk through the careful selection of investments, through the employment of experienced portfolio managers and through continuous monitoring of the Fund s investments. Another type of credit risk is exposure to the creditworthiness of the Fund s trading counterparties. All securities transactions executed by the Fund are settled upon delivery using approved brokers. The risk of payment default on securities is considered negligible, as delivery of securities sold is only made once the broker has received payment on behalf of the Fund. Payment is not made on a purchase until the securities have been received by the broker on behalf of the Fund. The trade will fail if either party fails to meet its obligation. The Fund may enter into derivative contracts for a variety of purposes, including but not limited to (i) for the purposes of hedging as defined in NI and (ii) as a substitute for purchasing or selling securities. Derivative contracts involve risks arising from the possible inability of counterparties to meet the terms of their contracts due to movement in currency, security values and interest rates. The Fund seeks to mitigate this risk through the careful selection of its derivative counterparties. Liquidity risk Liquidity risk is the risk that the Fund may not be able to settle or meet its obligation on time or at a reasonable price. The Fund has current financial liabilities outstanding, including but not limited to, margin loans and interest payable on its margin loans, accounts payable and accrued liabilities. The Manager seeks to mitigate this liquidity risk by ensuring that a reasonable portion of the Fund s investments trade in active markets and can be sold readily. There can be no assurance that an adequate market for the investments will exist at all times, or that the prices at which the investments trade, accurately reflect their fair value. Low trading volumes of the investments could also make it difficult to liquidate holdings quickly Annual Financial Statements 16

18 As required by IFRS 7 Financial Instruments, the Fund s financial liabilities should be categorized into relevant maturity groupings based on the remaining year as at December 31, 2014, December 31, 2013, and January 1, 2013 to the contractual maturity date. However, as all liabilities, including liabilities for redeemable units tendered for redemption as of the applicable balance sheet date (of which there were none as at December 31, 2014, December 31, 2013 and January 1, 2013), are due in less than one year, this analysis is not required in this instance. In accordance with the Fund s policy, the Investment Manager monitors the Fund s overall liquidity risk on a continuous basis. 6. FAIR VALUE OF FINANCIAL INSTRUMENTS The Fund uses a three-tier hierarchy as a framework for disclosing fair value which reflects the significance of the inputs used in making the measurements. The hierarchy has the following levels: Level 1 - quoted prices in an active market (Level 1 unadjusted inputs); Level 2 - inputs other than quoted prices (Level 2 directly or indirectly derived from observational market data); and Level 3 - inputs not based on observable market data (Level 3 unobservable inputs). In addition to the above disclosure requirements, IFRS 7 Financial Instruments:Disclosures, requires disclosure of significant transfers between Levels 1 and 2 since the prior reporting period, as well as reconciliation of Level 3 assets, disclosing separately changes during the reporting period attributable to: (i) total gains or losses recognized in net income, and a description of where they are presented in the income statement, (ii) purchases, sales, issues and settlements, and (iii) transfers into or out of Level 3 and the reasons for those transfers. Any significant transfers between Level 1 and Level 2 are disclosed. Further, for fair value measurements in Level 3, if changing one or more type of the inputs to reasonably possible alternative assumptions would change fair value significantly, the entity shall state this fact and disclose both the effect of those changes and how the effect was calculated. The following tables provide a summary of the inputs used as at December 31, 2014, December 31, 2013 and January 1, 2013 in valuing the Fund s investments carried at fair value: Level 1 Level 2 Level 3 Total As at December 31, 2014 $ $ $ $ Investments, at fair value: Equities 47,239,425 47,239,425 Fixed income Corporate bonds 107,759, ,759,199 Term loans 9,243,620 9,243,620 Total Investments, at fair value 47,239, ,002, ,242,244 Derivative liabilities (12,055,123) (12,055,123) Total 47,239, ,947, ,187, Annual Financial Statements 17

19 Level 1 Level 2 Level 3 Total As at December 31, 2013 $ $ $ $ Investments, at fair value: Equities 44,641,789 44,641,789 Fixed income Corporate bonds 134,980, ,980,848 Term loans 8,869,426 8,869,426 Total Investments, at fair value 44,641, ,850, ,492,063 Derivative liabilities (38,714) (38,714) Total 44,641, ,811, ,453,349 Level 1 Level 2 Level 3 Total As at January 1, 2013 $ $ $ $ Investments, at fair value: Equities 14,231,451 14,231,451 Fixed income Corporate bonds 115,369, ,369,881 Term loans 4,967,779 4,967,779 Total 14,231, ,337, ,569,111 The carrying values of cash, subscriptions receivable, interest receivable, payable for investments purchased, redemptions payable, distributions payable, accrued expenses and the Funds obligations for Net Assets attributable to holders of redeemable Units, approximates their fair values due to their short-term nature. During the Period, there were no Level 3 assets held by the Fund, nor were there significant transfers between levels. The following provides details of the categorization in the fair value hierarchy by asset classes: a) Equities The Fund s equity positions are classified as Level 1 when the security is actively traded and a reliable price is observable. b) Fixed income Fixed income includes primarily corporate bonds, and also term loans which are valued at the bid price provided by recognized investment dealers. These prices are observable and therefore the Funds corporate bonds and term loans have been classified as Level 2. c) Derivative assets and liabilities Derivative assets and liabilities consist of forward currency contracts which are valued based primarily on the contract notional amount, the difference between the contract rate and the forward market rate for the same currency, interest rates and credit spreads. Contracts for which counterparty credit spreads are observable and reliable, or for which credit-related inputs are determined not to be significant to fair value are classified as Level Annual Financial Statements 18

20 7. BORROWINGS Leverage is restricted to 25% of the total assets of the Fund. Accordingly, at the time of borrowing, the maximum amount of leverage that the Fund could employ is 1.33:1 (total long positions, including leveraged positions, divided by net assets of the Fund). As at December 31, 2014, the Fund had employed leverage equal to 15.7% of the net assets of the Fund (December 31, %; January 1, %) equating to $23,720,034 (December 31, $31,615,061; January 1, $2,374,891) which includes both margin payable and leverage obtained through derivatives. The minimum and maximum amount of borrowings outstanding during the twelve month period ended December 31, 2014 was $7,971,946 and $42,195,216, respectively. The minimum and maximum amount of borrowings outstanding for the year ended December 31, 2013 was $2,313,820 and $36,449,401, respectively and for the one year period ended January 1, 2013 was $0 and $23,818,610, respectively. At December 31, 2014, the Fund held $21,670,894 of cash (December 31, $3,474,362; January 1, $0) in collateral with a counterparty in connection with the derivative positions. 8. INCOME TAXES The Fund is not subject to tax on the portion of its income, including net realized capital gains for its taxation year, that is paid or payable to Unitholders. It is the intention of the Fund to pay all net taxable income and sufficient net taxable gains so that the Fund will not be subject to income taxes. No provision for income taxes has been recorded in the accompanying financial statements as all income and net realized capital gains are to be distributed to the Unitholders. Capital losses realized in excess of those utilized to offset realized capital gains in the current taxation year can be carried forward indefinitely and may be applied against future years capital gains. Non-capital losses may be carried forward for a period of 20 years and applied against future years taxable income. Certain dividends received by the Fund are subject to withholding tax imposed in the country of origin. Such income and gains are recorded on a gross basis and the related withholding taxes are shown separately in the Statements of Comprehensive Income. 9. EXPENSES OF THE FUND The Manager is entitled to an annual management fee equal to 0.30% per annum based on the net asset value of the Fund. The management fee is calculated daily and payable monthly in arrears, plus applicable taxes and totaled $611,786 and $527,060 for the twelve months ended December 31, 2014 and 2013, respectively. The Fund pays for all ordinary expenses incurred in connection with its operation and administration, including, but not limited to, all costs of Portfolio transactions, fees payable to the Manager, administrator and other third party service providers, custodial fees, legal, accounting, audit and valuation fees, other administrative expenses and any extraordinary expenses that the Fund may incur. 10. RELATED PARTY DISCLOSURE The Manager and the Investment Manager is a wholly-owned subsidiary of Brookfield Asset Management Inc. ( Brookfield ) and it manages the investment and trading activities of the Fund pursuant to a management agreement. Due to Brookfield s ability to control the Fund, Brookfield and its affiliates over which it has the ability to exercise control or significant influence, are related parties of the Fund by virtue of common control or common significant influence. Transactions with related parties, including investment transactions, are conducted in the normal course of operations and are recorded at exchange amounts, which are equivalent to normal market 2014 Annual Financial Statements 19

21 terms. Please refer to Note 9, Expenses of the Fund, which outlines the fees paid to the Manager by the Fund. During the twelve month period ended December 31, 2014, the Fund entered into inter-fund trades with Brookfield Select Opportunities Income Fund ( BSO ) which is a related party of the Fund due to common control. The Investment Manager determined that these inter-fund trades complied with the Fund s and BSO s investment restrictions and that owning the securities was consistent with the Fund s and BSO s investment objectives. The Manager sought the approval of the Fund s and BSO s Independent Review Committee (t he IRC ) of the proposed inter-fund trades. The IRC provided its approval on the proposed inter-fund trades on the Manager s recommendation. 11. REDEEMABLE UNITS AND NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE UNITS The Fund is authorized to issue an unlimited number of redeemable and transferable Units of a single class, each of which represents an equal, undivided interest in the net assets of the Fund. Each Unit is entitled to one vote at all meetings of Unitholders and is entitled to participate equally with respect to any and all distributions made by the Fund. On the redemption of Units, however, the Fund may in its sole discretion designate payable to redeeming Unitholders, as part of the redemption price, any capital gains realized by the Fund in the taxation year in which the redemption occurred. On termination or liquidation of the Fund, the holders of outstanding Units of record are entitled to receive, on a pro rata basis, all of the assets of the Fund remaining after payment of all debts, liabilities and liquidation expenses of the Fund. The Declaration of Trust provides that the Fund may not issue additional Units except: i) for net proceeds not less than 100% of the net asset value per Unit calculated as of the close of business on the business day immediately prior to the pricing of such offering; or (ii) by way of Unit distributions. Unitholders are entitled to redeem Units outstanding on any business day and will receive a redemption price equal to the net asset value per Unit of the Fund. Changes in the number of issued redeemable Units consisted of the following for the twelve months ended December 31, 2014 and 2013, respectively: For the period ended For the period ended December 31, 2014 December 31, 2013 Beginning balance 10,410,885 11,268,811 Redemption of Units (1,160,813) (857,926) Number of Units outstanding, end of period 9,250,072 10,410,885 Capital management Units issued and outstanding represent the capital for the Fund. The Fund has no restrictions or specific capital requirements and is authorized to issue an unlimited number of transferable Units. Restrictions and specific requirements on the redemption of Units are described above. The Statements of Changes in Net Assets Attributable To Holders of Redeemable Units and the above table outline the relevant changes of the Fund s Redeemable Units for the period. The Fund manages its capital in accordance with its investment objectives and strategies and the risk management practices outlined in Note 5 while maintaining sufficient liquidity to meet Unitholder redemptions Annual Financial Statements 20

22 12. DISTRIBUTIONS Unitholders will be entitled to receive distributions if, as and when declared by the Fund from time to time. All distributions will be paid in Units. Immediately after any distribution in Units, the number of outstanding Units will be consolidated such that each Unitholder will hold after the consolidation the same number of Units as it held before the distribution. 13. FINANCIAL INSTRUMENTS BY CATEGORY The following table presents the carrying amounts of the Fund's financial assets by category as at December 31, 2014, December 31, 2013, and January 1, All of the Fund's financial liabilities, other than its net assets attributable to holders of redeemable units At FVTPL At Amortized Cost Held for Designated Financial Assets as at December 31, 2014 Trading at Inception Total Total $ $ $ $ Financial assets at fair value through profit or loss 164,242, ,242,244 Cash and cash equivalents 4,305,788 Collateral cash 21,670,894 Accrued investment income 2,446,465 Total 164,242, ,242,244 28,423,147 Held for Designated Financial Liabilities as at December 31, 2014 Trading at Inception Total Total $ $ $ $ Unrealized depreciation on forward currency contracts 6,726,461 6,726,461 - Swap contracts 5,328,662 5,328,662 - M argin payable 29,646,663 Accounts payable and accrued liabilities 188,714 Total 12,055,123 12,055,123 29,835,377 At FVTPL At Amortized Cost Held for Designated Financial Assets as at December 31, 2013 Trading at Inception Total Total $ $ $ $ Financial assets at fair value through profit or loss 188,492, ,492,063 Cash and cash equivalents 4,289,707 Collateral cash 3,474,362 Accrued investment income 1,965,277 Total - 188,492, ,492,063 9,729,346 Held for Designated Financial Liabilities as at December 31, 2013 Trading at Inception Total Total $ $ $ $ Swap contracts 38,714 38,714 M argin payable 30,713,699 Accounts payable and accrued liabilities 172,536 Total 38,714 38,714 30,886, Annual Financial Statements 21

23 Financial Assets as at January 1, 2013 Held for Trading Designated at Inception Total At Amortized Cost Total $ $ $ $ Financial assets at fair value through profit or loss 134,569, ,569,111 Cash and cash equivalents 10,128,074 Accrued investment income 2,108,051 Total 134,569, ,569,111 12,236,125 Financial Liabilities as at January 1, 2013 Held for Trading At FVTPL Designated at Inception Total Total $ $ $ $ M argin payable 2,374,891 Due to broker 2,148,244 Accounts payable and accrued liabilities 99,791 Total 4,622,926 The following table presents the net gains (losses) on financial instruments at FVTPL by category for the periods ended December 31, 2014 and December 31, 2013: Category Financial assets and liabilities at FVTPL: Net gains (losses) $ $ Held for Trading (8,191,879) 468,360 Designated at inception 793,294 25,619,240 Total Financial assets and liabilities at FVTPL (7,398,585) 26,087,600 The Fund entered into various master netting arrangements in connection with its forward currency and swap derivative contracts. These agreements, such as the International Swaps and Derivatives Association agreements, do meet the criteria for offsetting in the Statements of Financial Position and allow for the related amounts to be settled on a net basis. Other financial assets and financial liabilities do not meet the criteria for offsetting but may be set off under certain circumstances, such as bankruptcy or termination of the contracts. The following table presents the recognized financial instruments that are offset, or subject to enforceable master netting agreements or other similar agreements, as at December 31, 2014, December 31, 2013 and January 1, The "Net amount presented" column represents the amount after offsetting, as stated in the Fund s Statements of Financial Position. The "Net" column represents what the impact on the Fund s Statements of Financial Position would be if all set-off rights were exercised Annual Financial Statements 22

24 Financial assets and liabilities December 31, 2014 Amounts offset Amounts not offset Gross Net Gross assets/liabilities Amounts Financial Cash collateral assets/liabilities offset presented Instruments received Net $ $ $ $ $ $ Net unrealized depreciation on forward currency contracts (6,910,822) 184,361 (6,726,461) - - (6,726,461) Swap Contracts (5,328,662) - (5,328,662) - - (5,328,662) (12,239,484) 184,361 (12,055,123) - - (12,055,123) December 31, 2013 Swap Contracts (44,822) 6,108 (38,714) - - (38,714) (44,822) 6,108 (38,714) - - (38,714) 14. TRANSITION TO IFRS The effects of the Fund s transition to IFRS are summarized in this note as follows: Transition elections The only voluntary exemption adopted by the Fund upon transition was the ability to designate a financial asset or financial liability at fair value through profit and loss upon transition to IFRS. All financial assets designated at FVTPL upon transition were previously carried at fair value under Canadian GAAP as required by Accounting Guideline 18, Investment Companies. Reconciliation of net assets attributable to holders of redeemable units and comprehensive income as previously reported under Canadian GAAP to IFRS Net assets attributable to holders of redeemable units December 31, 2013 January 1, 2013 Net assets attributable to holders of redeemable units as reported under Canadian GAAP 167,256, ,163,135 Revaluation of investments at FVTPL 40,286 19,175 Total net assets attributable to holders of redeemable units 167,296, ,182,310 Year ended Comprehensive Income December 31, 2013 Comprehensive income as reported under Canadian GAAP 36,973,039 Revaluation of investments at FVTPL 21,111 Total comprehensive income 36,994,150 Classification of redeemable units issued by the Fund Under Canadian GAAP, the Fund accounted for its redeemable units as equity. Under IFRS, International Accounting Standard, IAS 32 requires that units of an entity which include a contractual obligation for the issuer to repurchase or redeem them for cash or another financial asset be classified as financial liability. The characteristics of the units are not identical and therefore do not meet the 2014 Annual Financial Statements 23

25 criteria in IAS 32 for classification as equity. As such the Fund s redeemable units, have been reclassified as financial liabilities on transition to IFRS. Revaluation of investments at fair value through profit or loss Under Canadian GAAP, the Fund measured the fair value of its investments in accordance with Section 3855, Financial Instruments Recognition and Measurement, which required the use of bid prices for long positions and ask prices for short positions; to the extent such prices are available. Under IFRS, the fund measures the fair values of its investments using the guidance in Fair Value Measurement ( IFRS 13 ), which requires that if an asset or a liability has a bid price and an ask price, then its fair value is to be based on a price within the bid-ask spread that is most representative of fair value. It also allows the use of mid-market pricing or other pricing conventions that are used by market participants as a practical expedient for fair value measurements within a bid-ask spread. As a result, upon adoption of IFRS an adjustment was recognized to increase the carrying amount of the Fund s investment by $40,286 as at December 31, 2013 and by $19,175 and at January 1, The impact of this adjustment was to increase the fund s Net Assets attributable to holders of redeemable units by $21,111 for the year ended December 31, Reclassification adjustments In addition to the measurement adjustments noted above, the Fund reclassified certain amounts upon transition in order to conform to its financial statement presentation under IFRS. Withholding taxes of $16,243 for the period ended December 31, 2013 which were previously netted against dividend income under Canadian GAAP, have been reclassified and presented separately as expense under IFRS. Statement of cash flows All Funds are required under IFRS to provide cash flow statements. Under Canadian GAAP most Funds were exempt from this requirement. 15. EVENTS AFTER STATEMENT OF FINANCIAL POSITION DATE Management has evaluated subsequent events in the preparation of the Fund s financial statements and has determined that other than the items listed herein, there are no events that require recognition or disclosure in the annual financial statements Annual Financial Statements 24

26 FUND INFORMATION MANAGER AND INVESTMENT MANAGER Brookfield Investment Management (Canada) Inc. Gail Cecil Director, President & Chief Executive Officer Jonathan Tyras Director, Chief Financial Officer, Treasurer, and Secretary Craig Noble Director INDEPENDENT REVIEW COMMITTEE John P. Barratt (Chair) Corporate Director James L. R. Kelly President Earth Power Inc. Frank Lochan Corporate Director CONTACT INFORMATION welcomes inquiries from Unitholders, analysts, media representatives or other interested parties. Manager, Investment Manager, Transfer Agent, Registrar, and Trustee Unitholder inquiries relating to distributions, address changes and Unitholder account information should be directed to the Fund s Transfer Agent: Brookfield Investment Management (Canada) Inc. Brookfield Place 181 Bay Street, Suite 300 Toronto, Ontario M5J 2T3 t w Annual Financial Statements 25

27