LS FUND (formerly NORTHERN STAR) Société d'investissement à Capital Variable organised under the laws of Luxembourg

Transcription

1 Annual report including audited financial statements LS FUND (formerly NORTHERN STAR) Société d'investissement à Capital Variable organised under the laws of Luxembourg R.C.S. Luxembourg B

2 No subscription can be received on the basis of this financial report. Subscriptions are only valid if made on the basis of the current prospectus and the key investor information document ("KIID") supplemented by the latest annual report including audited financial statements and the most recent semi-annual report, if published thereafter.

3 Contents Organisation... 2 General information... 5 Additional information for investors in Switzerland... 7 Report on activities of the Board of Directors... 8 Report of the réviseur d'entreprises agréé...10 Combined statement of net assets...12 Combined statement of operations and other changes in net assets...13 LS FUND - Global Dynamic Opportunities 10+ (formerly NORTHERN STAR - Global Dynamic Opportunities 10+ Fund)...14 Statement of net assets...14 Statement of operations and other changes in net assets...15 Statistical information...16 Statement of investments and other net assets...18 Industrial and geographical classification of investments...19 LS FUND - Enhanced Fixed Income 5+ (formerly NORTHERN STAR - Enhanced Fixed Income 5+ Fund)...20 Statement of net assets...20 Statement of operations and other changes in net assets...21 Statistical information...22 Statement of investments and other net assets...23 Industrial and geographical classification of investments...24 LS FUND - Globetrotter (formerly NORTHERN STAR - Globetrotter Fund)...25 Statement of operations and other changes in net assets...25 Statistical information...26 Notes to the financial statements...27 Additional Information (unaudited)

4 Organisation Registered office 11, rue Aldringen L-1118 LUXEMBOURG Board of Directors Chairman Paavo PÕLD Serge D'ORAZIO CEO / Compliance LIMESTONE PLATFORM AS. (formerly NORTHERN STAR AS.) Väike Karja 10/Müürivahe TALLINN, ESTONIA (since 10th May 2016) Head of Investment Fund and Global Custody KBL EUROPEAN PRIVATE BANKERS S.A. 43, boulevard Royal L-2955 LUXEMBOURG (until 10th May 2016) Members Frits CARLSEN Benoit DUVIEUSART Mihkel ÕIM Stéphane RIES Independent Director NED / Directorships 5, An Den Azingen L-5386 UEBERSYREN (since 10th May 2016) Lawyer duvieusart ebel, avocats associés 55, rue Charles Arendt L-1134 LUXEMBOURG (since 10th May 2016) Chief Operating Officer LIMESTONE PLATFORM AS. (formerly NORTHERN STAR AS.) Väike Karja 10/Müürivahe TALLINN, ESTONIA (until 10th May 2016) Head of Business Development KBL EUROPEAN PRIVATE BANKERS S.A. 43, boulevard Royal L-2955 LUXEMBOURG (until 10th May 2016) Management Company LIMESTONE PLATFORM AS. (formerly NORTHERN STAR AS.) Väike Karja 10/Müürivahe TALLINN, ESTONIA 2

5 Organisation (continued) Board of Directors of the Management Company Chairman Markku Malkamäki Members of the Board Olli-Pekka Kallasvuo Eero Leskinen Management Board of the Management Company Paavo Põld Miika Peura Timo Rossi Investment manager and general distributor LIMESTONE PLATFORM AS. (formerly NORTHERN STAR AS.) Väike Karja 10/Müürivahe TALLINN, ESTONIA Depositary and principal paying agent KBL EUROPEAN PRIVATE BANKERS S.A. 43, boulevard Royal L-2955 LUXEMBOURG Registrar, transfer, domiciliary and administrative agent KREDIETRUST LUXEMBOURG S.A. 11, rue Aldringen L-2960 LUXEMBOURG Representative agent in Switzerland ACOLIN FUND SERVICES AG Affolternstrasse ZÜRICH Paying agent in Switzerland FRANKFURTER BANKGESELLSCHAFT (SCHWEIZ) AG Börsenstrasse 16, Postfach CH-8022 ZÜRICH 3

6 Organisation (continued) Cabinet de révision agréé DELOITTE Audit Société à responsabilité limitée 560, rue de Neudorf L-2220 LUXEMBOURG 4

7 General information LS FUND (the "Company"), formerly known as NORTHERN STAR is organised as a "Société d Investissement à Capital Variable" under the laws of the Grand Duchy of Luxembourg. The Company was incorporated on 25th June 2008 in Luxembourg for an unlimited period. The Company qualifies as an undertaking for collective investment in transferable securities ( UCITS ) under the Council Directive 2009/65/EC and is governed by the amended Luxembourg law of 10th August 1915 and by Part I of the amended law of 17th December 2010 relating to undertakings for collective investment ( UCI ). Its Articles of Association were published in the "Mémorial C, Mémorial Recueil des Sociétés et des Associations" on 28th July 2008 and were amended for the last time by notarial deed at the extraordinary general meeting held on 17th December 2015 which decided to change the corporate denomination of the Company from NORTHERN STAR to LS FUND. The Articles of Association are available for inspection and a copy thereof may be obtained upon request at the registered office of the Company. The Directive 2014/91/EU of the European Parliament and of the Council of 23rd July 2014 amending the Directive 2009/65/EC had been transposed by the law of 10th May 2016 coming into force on 1st June 2016 and amending the amended law of 17th December As from 1st June 2016, publications are made in the Recueil électronique des sociétés et associations ( RESA ) through the website of Registre de Commerce et des Sociétés of Luxembourg. At the date of the report, the Company offers the following Sub-Funds: - LS FUND - Global Dynamic Opportunities 10+ in EUR (formerly NORTHERN STAR - Global Dynamic Opportunities 10+ Fund) - LS FUND - Enhanced Fixed Income 5+ in EUR (formerly NORTHERN STAR - Enhanced Fixed Income 5+ Fund) - LS FUND - Globetrotter (liquidated on 15th April 2016) in EUR (formerly known as NORTHERN STAR - Globetrotter Fund) By resolution circular effected on 11th April 2016, the Board of Directors resolved to delete the word Fund at the end of the denomination of the Sub-Funds and to redeem the shares in the Sub-Fund LS FUND - Globetrotter (formerly NORTHERN STAR - Globetrotter Fund) as at 15th April The redemption proceeds was transferred in kind to the Emerging Markets Dynamic Opportunities Sub-Fund of the LS Opportunities Fund S.C.A. - SICAV - FIS through a combined redemption in kind from LS FUND - Globetrotter (formerly NORTHERN STAR - Globetrotter Fund) and a subscription in kind in the SIF Emerging Markets Dynamic Opportunities Sub-Fund of the LS Opportunities Fund S.C.A. - SICAV - FIS. The Company may issue shares of no par value of different Classes of Shares, which relate to each portfolio of assets. At the date of the report, the following classes of capitalisation Shares have been issued: - A-Class EUR Share - I-Class EUR Share (restricted to institutional investors) - R-Class EUR Share for the Sub-Fund LS FUND - Global Dynamic Opportunities 10+ (formerly NORTHERN STAR - Global Dynamic Opportunities 10+ Fund). The Board of Directors may decide to issue further Sub-Funds and Classes of Shares. The reference currency of the Company is the Euro ("EUR"). The combined accounts of the Company are expressed in EUR. Financial year ends on 30th June of each year. 5

8 General information (continued) The full prospectus, the KIID, the Articles of Association, the most recent annual and semi-annual report are available free of charge at the registered office of the Company, at any Paying Agent and any Distributor. The net asset value per share and redemption and subscription prices may be obtained at the registered office of the Company. 6

9 Additional information for investors in Switzerland Representative agent, paying agent, place of execution and jurisdiction Representative agent in Switzerland: ACOLIN FUND SERVICES AG, Affolternstrasse 56, 8050 ZÜRICH. Paying Agent in Switzerland: FRANKFURTER BANKGESELLSCHAFT (SCHWEIZ) AG, Börsenstrasse 16, Postfach, CH-8022 ZÜRICH. Place of execution and jurisdiction in respect of all shares of the Company offered or distributed in or from Switzerland is the registered office of the representative agent in Switzerland. Publications, issue and redemption prices The Articles of Association, the detailed prospectus, the KIID and the annual and semi-annual reports may be obtained, free of charge, at the representative agent in Switzerland. The publications in relation with the Company are made in Switzerland in the "Schweizerischen Handelsamtblatt" as well as on the electronic platform In these publication organs are particularly published essential information like important changes in the prospectus as well as the liquidation of the Company or of one or several Sub-Funds. The issue and redemption prices respectively the net asset value with a note "commission not included" of all the classes of shares are published on a daily basis on the electronic platform Prevailing version The German version of the prospectus prevails in the legal relationship between the Company and the investors in Switzerland. Reimbursements and compensations for distribution 1. In connection with distribution in Switzerland, reimbursement may only be paid to the qualified investors listed below that, from a commercial perspective, hold Company shares on behalf of third parties: life-insurance companies, pension funds and other retirement provision institutions, investment foundations, Swiss fund management companies, foreign funds management companies and providers, investment companies. 2. In connection with distribution in Switzerland, distribution fees may only be paid to the following distributors and sales agents/partners: distributors subject to the duty to obtain authorisation from the FINMA pursuant to Article 19.1 CISA (the Collective Investments Schemes Act), distributors exempt from the duty to obtain authorisation pursuant to Article 19.4 CISA and Article 8 CISO (Collective Investments Schemes Ordinance), sales partners who place the Company shares exclusively with institutional investors with professional treasury facilities, sales partners who place the Company shares exclusively on the basis of a written asset management mandate. 7

10 Report on activities of the Board of Directors Market Performance Review In order to set stage for the individual sub-fund performance analysis let us first look at how the global markets weathered during the fiscal year The most keenly watched US economy and broad market showed modest gains during the late 2015, although investor discipline was tested by news of a global economic slowdown, rising market volatility in China and emerging markets, falling oil and commodities prices, and higher US interest rates. In 2015, economic growth was the weakest since the financial crisis. In December, the Organization for Economic Cooperation and Development (OECD) revised its 2015 world growth estimate downward to 2.9%-well below the historical average of 3.6% per year. Eurozone GDP growth slowed towards the end of 2015 to 0.4% in Q2 and to 0.3% in Q3. The slowdown came in spite of improved consumer spending sparked by lower energy prices and the European Central Bank s (ECB) quantitative easing efforts. A decline in the euro s value boosted exports and contributed to an improved current account surplus (3.7% of GDP) in Japan s economy showed signs of improvement early in 2015, but the pace also slowed towards the end of 2015 and China, the world s second largest economy, showed signs of a slowdown during 2015 with the Chinese government revising its growth target to 6.5%, reflecting the weakest growth in 25 years. Slower growth extended to other emerging markets. In Q4, the International Monetary Fund (IMF) cut its 2015 growth estimate for emerging markets to 4%, which marked the fifth consecutive year of declining growth. Global equity markets as measured by the MSCI All Country World Index had a weak year during the 12 months leading up to June 30, 2016 posting a percent loss (in euro terms). While all developed markets ended in the negative territory the only winner was North America with 0.72 percent gain. Slowing economies in Europe weighed on the equity market performance making Europe the weakest markets leading up to June 30, 2016 were Europe with negative 13.6 percent return. Pacific region was also relatively weak posting percent loss for the year. Emerging Markets lagged significantly back from its developed counterparts posting a percent loss for the year. African markets were hit the worst while South East Asia weathered the best. LS FUND - Global Dynamic Opportunities 10+ (formerly Northern Star - Global Dynamic Opportunities 10+ Fund) was launched in December 2011 with an absolute return target aiming to generate an annualized return of over 10 percent on invested capital over the period of a business cycle. The subfund invests in all major liquid asset classes and allocates capital among the asset classes with a dynamic approach. Capital preservation is the first priority in poor market environments. The sub-fund had a difficult year and posted a negative 20.4 percent performance during the 12 month period ending June 30, Late 2015 the fund manager had a positive view regarding the global economy and in particular the European recovery which was expected to continue in However headwinds from slower economic growth and BREXIT triggered European equity markets to react negatively. The fund reduced and hedged equity exposure before the Brexit vote and had 53 percent of the assets in cash at the end of June The sub-fund expects to start increasing equity exposure again as global growth expectations have improved mainly due to increased expectations in emerging markets. The Russian and Brazilian economies both seem to have bottomed after being a drag on the global economy for a long time. Furthermore, Chinese economic leading indicators have improved recently. 8

11 Report on activities of the Board of Directors (continued) LS FUND - Enhanced Fixed Income 5+ (formerly Northern Star - Enhanced Fixed Income 5+ Fund) was launched in December 2011 and it has an absolute return target aiming to generate an annualized return of over 5 percent on invested capital over the period of a business cycle. The Fund invests in all major liquid asset classes and allocates capital among the asset classes with a dynamic approach. At least 60% of the capital is always invested in fixed income instruments. Capital preservation is the first priority in poor market environments. The sub-fund had a difficult year as it posted a fiscal year return of 13.7 percent. At the end of the period the fund had invested 86.7 percent of its assets into fixed income, with equities exposure amounting to -1.4 percent and cash standing at 7.8 percent. The fund allocation reflects its strategy to reduce risk substantially before the Brexit vote. The sub-fund expects to increase risk by adding more risk in both bonds and increasing equity allocation from near zero levels at the end of June LS FUND - Globetrotter Fund (formerly Northern Star - Globetrotter Fund) was launched in February 2011 with an investment objective to construct an actively managed concentrated high-conviction portfolio that invests in equities and equity related instruments of emerging and frontier markets companies. Due to adverse market environment and sentiment in Emerging and Frontier equity markets cornerstone investor in the sub-fund decided to redeem all of their holdings in the fund. The board of directors resolved that the satisfaction of this redemption request will have an effect that the assets of the subfund shall decrease below the minimum level for such sub-fund to be operated in an economically efficient manner and the Board adopted the opinion that the sub-fund has no significant future prospect of development in these circumstances. The Board taking this redemption request into consideration deemed that the continued operation of the sub-fund would be detrimental to the other remaining shareholders and decided to liquidate the sub-fund in April Luxembourg, 6th September 2016 The Board of Directors Note: The information in this report represents historical data and is not an indication of future results. 9

12 Report of the réviseur d'entreprises agréé To the Shareholders of Deloitte Audit Société à responsabilité limitée 560, rue de Neudorf L-2220 Luxembourg B.P L-1011 Luxembourg Tel: Fax: Following our appointment by the general meeting of the shareholders, we have audited the accompanying financial statements of (the Company ) and of each of its sub-funds, which comprise the statement of net assets and the statement of investments and other net assets as at 30 June 2016 and the statement of operations and other changes in net assets for the year then ended, and a summary of significant accounting policies and other explanatory notes to the financial statements. Responsibility of the Board of Directors of the Company for the financial statements The Board of Directors of the Company is responsible for the preparation and fair presentation of these financial statements in accordance with Luxembourg legal and regulatory requirements relating to the preparation of the financial statements and for such internal control as the Board of Directors of the Company determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Responsibility of the réviseur d entreprises agréé Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing as adopted for Luxembourg by the Commission de Surveillance du Secteur Financier. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance 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 réviseur d entreprises agréé s judgement, 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 réviseur d entreprises agréé 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. Société à responsabilité limitée au capital de EUR RCS Luxembourg B

13 Deloitte. Report of the reviseur d'entreprises agree (continued) An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board of Directors of the Company, 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 give a true and fair view of the financial position of LS FUND (formerly NORTHERN STAR) and of each of its sub-funds as at 30 June 2016, and of the results of their operations and changes in their net assets for the year then ended in accordance with Luxembourg legal and regulatory requirements relating to the preparation of the financial statements. Other matter Supplementary information included in the annual report has been reviewed in the context of our mandate but has not been subject to specific audit procedures carried out in accordance with the standards described above. Consequently, we express no opinion on such information. However, we have no observation to make concerning such information in the context of the financial statements taken as a whole. For Deloitte Audit Cabinet de revision agree Nicolas Hennebert, Reviseur d'entreprises agree Partner 1 3 October , rue de Neudorf L-2220 LUXEMBOURG 11

14 Combined statement of net assets (in EUR) Assets Securities portfolio at market value 30,052, Cash at banks 1,202, Other liquid assets 2,188, Formation expenses, net Receivable on sales of securities 1,814, Income receivable on portfolio 48, Interest receivable on bank accounts Receivable on futures contracts 318, Total assets 35,625, Liabilities Bank overdrafts Payable on purchases of securities 573, Payable on redemptions of shares 634, Interest payable on bank overdrafts 2, Unrealised loss on futures contracts 435, Unrealised loss on forward foreign exchange contracts 51, Expenses payable 106, Other liabilities Total liabilities 1,804, Net assets at the end of the year 33,821, The accompanying notes are an integral part of these financial statements. 12

15 Combined statement of operations and other changes in net assets (in EUR) from 1st July 2015 to 30th June 2016 Income Dividends, net 328, Interest on bonds and other debt securities, net 4, Interest on bank accounts Commissions received 17, Total income 350, Expenses Management fees 920, Performance fees 1, Depositary fees 29, Banking charges and other fees 30, Transaction fees 109, Central administration costs 180, Professional fees 65, Other administration costs 160, Subscription duty ("taxe d'abonnement") 12, Other taxes 1, Interest paid on bank overdrafts 16, Other expenses 59, Total expenses 1,588, Net investment loss -1,238, Net realised gain/(loss) - on securities portfolio -4,969, on option contracts -1, on futures contracts -5,659, on forward foreign exchange contracts -147, on foreign exchange -196, Realised result -12,212, Net variation of the unrealised gain/(loss) - on securities portfolio -1,184, on futures contracts -434, on forward foreign exchange contracts -51, Result of operations -13,883, Subscriptions 9,982, Redemptions -34,467, Total changes in net assets -38,368, Total net assets at the beginning of the year 72,189, Total net assets at the end of the year 33,821, The accompanying notes are an integral part of these financial statements. 13

16 LS FUND - Global Dynamic Opportunities 10+ Statement of net assets (in EUR) Assets Securities portfolio at market value 27,765, Cash at banks 1,059, Other liquid assets 2,092, Formation expenses, net Receivable on sales of securities 1,814, Income receivable on portfolio 45, Interest receivable on bank accounts Receivable on futures contracts 318, Total assets 33,097, Liabilities Bank overdrafts Payable on purchases of securities 573, Payable on redemptions of shares 634, Interest payable on bank overdrafts 2, Unrealised loss on futures contracts 417, Unrealised loss on forward foreign exchange contracts 48, Expenses payable 78, Other liabilities Total liabilities 1,755, Net assets at the end of the year 31,341, A-Class EUR Shares outstanding 152, Net asset value per A-Class EUR Share I-Class EUR Shares outstanding 136, Net asset value per I-Class EUR Share R-Class EUR Shares outstanding 18, Net asset value per R-Class EUR Share The accompanying notes are an integral part of these financial statements. 14

17 LS FUND - Global Dynamic Opportunities 10+ Statement of operations and other changes in net assets (in EUR) from 1st July 2015 to 30th June 2016 Income Dividends, net 236, Interest on bonds and other debt securities, net 4, Commissions received 11, Total income 252, Expenses Management fees 623, Performance fees 1, Depositary fees 21, Banking charges and other fees 8, Transaction fees 67, Central administration costs 94, Professional fees 21, Other administration costs 86, Subscription duty ("taxe d'abonnement") 10, Interest paid on bank overdrafts 15, Other expenses 26, Total expenses 978, Net investment loss -725, Net realised gain/(loss) - on securities portfolio -1,921, on option contracts -1, on futures contracts -5,189, on forward foreign exchange contracts -134, on foreign exchange -78, Realised result -8,050, Net variation of the unrealised gain/(loss) - on securities portfolio -1,483, on futures contracts -420, on forward foreign exchange contracts -48, Result of operations -10,002, Subscriptions 9,773, Redemptions -14,172, Total changes in net assets -14,401, Total net assets at the beginning of the year 45,743, Total net assets at the end of the year 31,341, The accompanying notes are an integral part of these financial statements. 15

18 LS FUND - Global Dynamic Opportunities 10+ Statistical information (in EUR) Total net assets - as at ,341, as at ,743, as at ,064, Number of A-Class EUR Shares - outstanding at the beginning of the year 127, issued 60, redeemed -35, outstanding at the end of the year 152, Net asset value per A-Class EUR Share - as at as at as at Performance A-Class EUR Shares (in %) - as at as at as at Synthetic TER per A-Class EUR Share (in %) - as at Performance Fee ratio (in % of the average net assets) - as at Number of I-Class EUR Shares - outstanding at the beginning of the year 205, issued 19, redeemed -88, outstanding at the end of the year 136, Net asset value per I-Class EUR Share - as at as at as at Performance I-Class EUR Shares (in %) - as at as at as at Synthetic TER per I-Class EUR Share (in %) - as at Performance Fee ratio (in % of the average net assets) - as at Annual performances were calculated for the last 3 consecutive financial years. For Sub-Funds / Classes of Shares launched or liquidated during the financial year, the corresponding annual return has not been calculated. The historical performance is not an indication of future results. The performance data do not take account of the commissions and costs incurred on the issue and redemption of shares of the Company. The accompanying notes are an integral part of these financial statements. 16

19 LS FUND - Global Dynamic Opportunities 10+ Statistical information (in EUR) (continued) Number of R-Class EUR Shares - outstanding at the beginning of the year 24, issued 1, redeemed -7, outstanding at the end of the year 18, Net asset value per R-Class EUR Share - as at as at as at Performance R-Class EUR Shares (in %) - as at as at as at Synthetic TER per R-Class EUR Share (in %) - as at Performance Fee ratio (in % of the average net assets) - as at Annual performances were calculated for the last 3 consecutive financial years. For Sub-Funds / Classes of Shares launched or liquidated during the financial year, the corresponding annual return has not been calculated. The historical performance is not an indication of future results. The performance data do not take account of the commissions and costs incurred on the issue and redemption of shares of the Company. The accompanying notes are an integral part of these financial statements. 17

20 LS FUND - Global Dynamic Opportunities 10+ Statement of investments and other net assets (in EUR) Currency Number / nominal value Description Cost Market value % of total net assets Investments in securities Transferable securities admitted to an official stock exchange listing Shares DKK 10,400 Novo Nordisk AS B 504, , EUR 21,500 Deutsche Wohnen AG 620, , EUR 126,000 Nokia Oyj 712, , ,333, ,299, SEK 62,000 Nordea Bank AB 516, , USD 5,300 Aetna Inc 518, , USD 5,000 Apple Inc 417, , USD 7,300 Medtronic Plc 518, , ,454, ,585, Total shares 3,809, ,852, Investment certificates USD 15,000 ETFS Metal Sec Ltd Certif Gold Perpetual 1,740, ,721, Total investment certificates 1,740, ,721, Bonds USD 1,900,000 US 2% T-Notes Ser B / ,729, ,794, Total bonds 1,729, ,794, Transferable securities dealt in on another regulated market Bonds USD 1,900,000 US 2.5% T-Notes Ser C 24 14/ ,797, ,862, Total bonds 1,797, ,862, Open-ended investment funds Investment funds (UCITS) USD 47,300 Istl Cash Series Plc US Dollars Liquidity Fd Core USD Cap 6,061, ,142, USD 39,000 Pictet Sovereign Short Term Money Market USD I Cap 3,524, ,617, Total investment funds (UCITS) 9,586, ,760, Tracker funds (UCITS) EUR 91,000 ishares VI Plc Edge MSCI Eur Minimum Volatil UCITS ETF Dist 3,503, ,421, EUR 40,000 Lyxor UCITS ETF Russia (DJRuGDR) C EUR Cap 948, , ,451, ,370, USD 48,000 ishares IV Plc USD Short Duration Corp Bd UCITS ETF Dist 4,323, ,404, Total tracker funds (UCITS) 8,774, ,774, Total investments in securities 27,437, ,765, Cash at banks 1,059, Bank overdrafts Other net assets/(liabilities) 2,516, Total 31,341, The accompanying notes are an integral part of these financial statements. 18

21 LS FUND - Global Dynamic Opportunities 10+ Industrial and geographical classification of investments Industrial classification (in percentage of net assets) Investment funds % Countries and governments % Investment companies 5.49 % Health care equipment and services 3.68 % Technology hardware and equipment 3.43 % Real estate 2.09 % Pharmaceuticals and biotechnology 1.60 % Banks 1.49 % Total % Geographical classification (by domicile of the issuer) (in percentage of net assets) Ireland % United States of America % Luxembourg % Jersey 5.49 % France 3.03 % Germany 2.09 % Finland 2.05 % Denmark 1.60 % Sweden 1.49 % Total % 19

22 LS FUND - Enhanced Fixed Income 5+ Statement of net assets (in EUR) Assets Securities portfolio at market value 2,286, Cash at banks 143, Other liquid assets 95, Formation expenses, net Income receivable on portfolio 2, Interest receivable on bank accounts Total assets 2,528, Liabilities Bank overdrafts 7.34 Interest payable on bank overdrafts Unrealised loss on futures contracts 18, Unrealised loss on forward foreign exchange contracts 3, Expenses payable 27, Total liabilities 48, Net assets at the end of the year 2,479, A-Class EUR Shares outstanding 21, Net asset value per A-Class EUR Share I-Class EUR Shares outstanding 3, Net asset value per I-Class EUR Share The accompanying notes are an integral part of these financial statements. 20

23 LS FUND - Enhanced Fixed Income 5+ Statement of operations and other changes in net assets (in EUR) from 1st July 2015 to 30th June 2016 Income Dividends, net 33, Interest on bonds and other debt securities, net Interest on bank accounts Commissions received 5, Total income 39, Expenses Management fees 171, Performance fees 2.20 Depositary fees 5, Banking charges and other fees 3, Transaction fees 16, Central administration costs 49, Professional fees 21, Other administration costs 43, Subscription duty ("taxe d'abonnement") 1, Interest paid on bank overdrafts 1, Other expenses 9, Total expenses 325, Net investment loss -286, Net realised gain/(loss) - on securities portfolio -440, on option contracts on futures contracts -469, on forward foreign exchange contracts -13, on foreign exchange -41, Realised result -1,251, Net variation of the unrealised gain/(loss) - on securities portfolio -443, on futures contracts -14, on forward foreign exchange contracts -3, Result of operations -1,712, Subscriptions 173, Redemptions -12,675, Total changes in net assets -14,214, Total net assets at the beginning of the year 16,694, Total net assets at the end of the year 2,479, The accompanying notes are an integral part of these financial statements. 21

24 LS FUND - Enhanced Fixed Income 5+ Statistical information (in EUR) Total net assets - as at ,479, as at ,694, as at ,978, Number of A-Class EUR Shares - outstanding at the beginning of the year 37, issued 1, redeemed -17, outstanding at the end of the year 21, Net asset value per A-Class EUR Share - as at as at as at Performance A-Class EUR Shares (in %) - as at as at as at Synthetic TER per A-Class EUR Share (in %) - as at Performance Fee ratio (in % of the average net assets) - as at Number of I-Class EUR Shares - outstanding at the beginning of the year 104, issued redeemed -101, outstanding at the end of the year 3, Net asset value per I-Class EUR Share - as at as at as at Performance I-Class EUR Shares (in %) - as at as at as at Synthetic TER per I-Class EUR Share (in %) - as at Performance Fee ratio (in % of the average net assets) - as at Annual performances were calculated for the last 3 consecutive financial years. For Sub-Funds / Classes of Shares launched or liquidated during the financial year, the corresponding annual return has not been calculated. The historical performance is not an indication of future results. The performance data do not take account of the commissions and costs incurred on the issue and redemption of shares of the Company. The accompanying notes are an integral part of these financial statements. 22

25 LS FUND - Enhanced Fixed Income 5+ Statement of investments and other net assets (in EUR) Currency Number / nominal value Description Cost Market value % of total net assets Investments in securities Transferable securities admitted to an official stock exchange listing Shares DKK 370 Novo Nordisk AS B 17, , EUR 800 Deutsche Wohnen AG 22, , EUR 3,650 Nokia Oyj 20, , , , SEK 2,000 Nordea Bank AB 16, , USD 210 Aetna Inc 20, , USD 200 Apple Inc 16, , USD 300 Medtronic Plc 21, , , , Total shares 136, , Investment certificates USD 1,500 ETFS Metal Sec Ltd Certif Gold Perpetual 174, , Total investment certificates 174, , Bonds USD 100,000 US 2% T-Notes Ser B / , , USD 100,000 US 2.25% T-Notes Ser F / , , Total bonds 183, , Transferable securities dealt in on another regulated market Bonds USD 100,000 US 2.5% T-Notes Ser C 24 14/ , , Total bonds 94, , Open-ended investment funds Investment funds (UCITS) EUR 380 Aberdeen Liquidity Fd (Lux) EUR I2 Units Cap 463, , USD 2,410 Istl Cash Series Plc US Dollars Liquidity Fd Core USD Cap 308, , Total investment funds (UCITS) 772, , Tracker funds (UCITS) EUR 3,400 ishares III Plc EUR Corp Bond 1-5 UCITS ETF Dist 369, , EUR 2,800 Lyxor UCITS ETF Russia (DJRuGDR) C EUR Cap 66, , , , USD 5,100 ishares IV Plc USD Short Duration Corp Bd UCITS ETF Dist 458, , Total tracker funds (UCITS) 894, , Total investments in securities 2,257, ,286, Cash at banks 143, Bank overdrafts Other net assets/(liabilities) 49, Total 2,479, The accompanying notes are an integral part of these financial statements. 23

26 LS FUND - Enhanced Fixed Income 5+ Industrial and geographical classification of investments Industrial classification (in percentage of net assets) Investment funds % Countries and governments % Investment companies 6.94 % Health care equipment and services 1.88 % Technology hardware and equipment 1.45 % Real estate 0.99 % Pharmaceuticals and biotechnology 0.72 % Banks 0.61 % Total % Geographical classification (by domicile of the issuer) (in percentage of net assets) Ireland % Luxembourg % United States of America % Jersey 6.94 % France 2.68 % Germany 0.99 % Finland 0.75 % Denmark 0.72 % Sweden 0.61 % Total % 24

27 LS FUND - Globetrotter Statement of operations and other changes in net assets (in EUR) from 1st July 2015 to 15th April 2016 Income Dividends, net 58, Total income 58, Expenses Management fees 124, Depositary fees 2, Banking charges and other fees 17, Transaction fees 25, Central administration costs 37, Professional fees 21, Other administration costs 30, Subscription duty ("taxe d'abonnement") Other taxes 1, Interest paid on bank overdrafts Other expenses 23, Total expenses 285, Net investment loss -226, Net realised gain/(loss) - on securities portfolio -2,607, on forward foreign exchange contracts on foreign exchange -76, Realised result -2,910, Net variation of the unrealised gain/(loss) - on securities portfolio 741, Result of operations -2,168, Subscriptions 35, Redemptions -7,619, Total changes in net assets -9,752, Total net assets at the beginning of the year 9,752, Total net assets at the end of the year 0.00 The accompanying notes are an integral part of these financial statements. 25

28 LS FUND - Globetrotter Statistical information (in EUR) Total net assets - as at as at ,752, as at ,791, Number of A-Class EUR Shares - outstanding at the beginning of the year 4, issued redeemed -4, outstanding at the end of the year Net asset value per A-Class EUR Share - as at as at as at Number of I-Class EUR Shares - outstanding at the beginning of the year 87, issued redeemed -87, outstanding at the end of the year Net asset value per I-Class EUR Share - as at as at as at Annual performances were calculated for the last 3 consecutive financial years. For Sub-Funds / Classes of Shares launched or liquidated during the financial year, the corresponding annual return has not been calculated. The historical performance is not an indication of future results. The performance data do not take account of the commissions and costs incurred on the issue and redemption of shares of the Company. The accompanying notes are an integral part of these financial statements. 26

29 Notes to the financial statements Note 1 - Principal accounting methods a) Presentation of the financial statements The financial statements of the Company are established in accordance with Luxembourg legal and regulatory requirements concerning undertakings for collective investment. b) The valuation of the securities 1) The valuation of any transferable securities or money market instruments or derivatives traded or listed on a stock exchange is made on the basis of the last price as at the Valuation Day unless such price is not representative. 2) The value of any transferable securities or money market instruments traded on another regulated market is determined on the basis of the last price as at the Valuation Day. 3) In the event that transferable securities and money market instruments on a dedicated Valuation Day are neither officially traded nor listed on an exchange or regulated market, or if, for securities and money market instruments officially listed or traded on a stock exchange or another regulated market, the price as determined pursuant to the above paragraphs is not representative of the true value of such transferable securities or money market instruments, the valuation is made on the basis of their likely value of realisation, estimated with due care and good faith by the Board of Directors of the Company. 4) Shares of UCITS and other UCI s are valued on the basis of their last available net asset value ( NAV ) at the Valuation Day. c) Acquisition cost of securities in the portfolio The acquisition cost of the securities held by each Sub-Fund that are denominated in currencies other than the reference currency of the Sub-Fund is converted into this currency at the exchange rate prevailing on the date of purchase. d) Net realised gain/(loss) on sales of securities portfolio The realised gains and losses on sales of securities portfolio are calculated on the basis of the average acquisition cost. The realised gains and losses on sales of securities portfolio are recorded net in the statement of operations and other changes in net assets. e) Investment income Dividend income is recorded at the ex-date, net of any withholding tax. Interest income accrued and payable are recorded, net of any withholding tax. f) Valuation of forward foreign exchange contracts Forward foreign exchange contracts are valued at forward market rates for the remaining period from valuation date to the maturity of the contracts. Unrealised gains or losses are recorded in the statement of net assets. Net variation of the unrealised gains or losses and net realised gains or losses are recorded in the statement of operations and other changes in net assets. g) Valuation of futures contracts Futures contracts are registered on the posted off-balance sheet and valued at the last settlement or close price on the stock exchanges or regulated markets. Unrealised gains or losses are recorded in 27

30 Notes to the financial statements (continued) the statement of net assets. Net variation of the unrealised gains and losses and net realised gains and losses are recorded in the statement of operations and other changes in net assets. h) Formation expenses Formation expenses are amortised on a straight line basis over a period of five years. i) Conversion of foreign currencies Cash at banks, other net assets and liabilities and the market value of the securities in portfolio expressed in currencies other than the currency of the Sub-Fund are converted into this currency at the exchange rate prevailing on the date of the report. Income and expenses expressed in currencies other than the currency of the Sub-Fund are converted into this currency at the exchange rate prevailing on the date of the transaction. Foreign exchange gains or losses are recorded in the statement of operations and other changes in net assets. j) Combined financial statements The combined financial statements of the Company are expressed in EUR and are equal to the sum of the corresponding captions in the financial statements of each Sub-Fund. k) Transaction fees Transaction costs disclosed under the caption "Transaction fees" in the expenses of the statement of operations and other changes in net assets are mainly composed of broker fees incurred by the Company and of fees relating to liquidation of transactions paid to the depositary as well as of transaction fees on financial instruments and derivatives and of fees relating to term deposits. Note 2 - Management and performance fees LIMESTONE PLATFORM AS. (formerly NORTHERN STAR AS.) is appointed as Management Company by the Board of Directors of the Company. The Management Company, LIMESTONE PLATFORM AS. is entitled to a fee of 0.05% p.a. of the average of the net assets of each Sub-Fund during the relevant quarter with an annual minimum of EUR 25,000 per Sub-Fund. The Management Company can receive too: - up to 500 trades, a minimum fee amounting to EUR 15, per sub-fund and per year, - above 500 trades, every next 100 trades fixed fee extra amounting to EUR 5, per sub-fund and per year, - and a variable fee per sub-fund and per year as follows: Up to EUR 100 mio 0.05% From EUR 100 mio to EUR 125 mio 0.03% Above EUR 125 mio 0.01% 28

31 Notes to the financial statements (continued) The investment management fee to be earned by the Management Company is calculated on the monthly average net asset value of each Sub-Fund and accrued daily at the following effective rates: LS FUND - Global Dynamic Opportunities 10+ (formerly NORTHERN STAR - Global Dynamic Opportunities 10+ Fund) Share Class Investment Performance fee Management fee A-Class EUR 1.50% Yes I-Class EUR 1.00% Yes R-Class EUR 2.50% Yes LS FUND - Enhanced Fixed Income 5+ (formerly NORTHERN STAR - Enhanced Fixed Income 5+ Fund) Share Class Investment Performance fee Management fee A-Class EUR 1.25% Yes I-Class EUR 0.75% Yes LS FUND - Globetrotter (formerly NORTHERN STAR - Globetrotter Fund) (liquidated on 15th April 2016) Share Class Investment Performance fee Management fee A-Class EUR 2.50% Yes I-Class EUR 1.50% Yes The Management Company fees and the Investment Management fees are included in the caption "Management fees" in the statement of operations and other changes in net assets. For the LS FUND - Global Dynamic Opportunities 10+ (formerly NORTHERN STAR - Global Dynamic Opportunities 10+ Fund), the Investment Manager is entitled to a performance fee in the amount of 15% in excess of the performance of 8% annually as Hurdle Rate. For the LS FUND - Enhanced Fixed Income 5+ (formerly NORTHERN STAR - Enhanced Fixed Income 5+ Fund), the Investment Manager is entitled to a performance fee in the amount of 15% in excess of the performance of 4% annually as Hurdle Rate. For the LS FUND - Globetrotter (formerly NORTHERN STAR - Globetrotter Fund) (liquidated on 15th April 2016), the Investment Manager is entitled to a performance fee in the amount of 20% in excess of the performance of 8% annually as Hurdle Rate. The period for which such performance fee is calculated is based on the Financial Year of the Sub-Funds. The performance fee is payable on the outstanding Shares of the Sub-Funds at the end of the relevant Financial Year. For the purpose of calculating the performance fee, the Sub-Fund s NAV per Share is calculated by the Administrative Agent on the relevant day by determining the NAV of each Sub-Fund, divided by the number of outstanding Shares on that day. For the LS FUND - Globetrotter (formerly NORTHERN STAR - Globetrotter Fund) (liquidated on 15th April 2016), the period for which such performance fee is calculated is based on each quarter of the aforementioned Sub-Fund. The performance fee is payable on the outstanding shares of this Sub-Fund at the end of the relevant quarter. In case of subscription, the performance fee calculation is adjusted to avoid that this subscription impacts the amount of performance fee accruals. To perform this adjustment, the performance of the NAV per Share against the reference NAV until the subscription date is not taken into account in the performance fee calculation. This adjustment amount is equal to the product of the number of subscribed 29

32 Notes to the financial statements (continued) Shares by the positive difference between the subscription price and the reference NAV adjusted by the Hurdle Rate at the date of the subscription. This cumulated adjustment amount is used in the performance fee calculation until the end of the relevant period and is adjusted in case of subsequent redemptions during the period. If any Shares are redeemed or converted to Shares of another Sub-Fund during the calculation period, the cumulative performance fee accrued during the calculation period in respect of those Shares shall be crystallized and become payable to the Investment Manager even if no accrual for performance fees is done at the date of the payment. At the date of the report, the performance fee was recorded for the following Sub-Funds and amounted to: LS FUND - Global Dynamic Opportunities 10+ (formerly NORTHERN STAR - Global Dynamic Opportunities 10+ Fund) LS FUND - Enhanced Fixed Income 5+ (formerly NORTHERN STAR - Enhanced Fixed Income 5+ Fund) EUR 1, EUR 2.20 Note 3 - Central administration costs The caption "Central administration costs" disclosed in the statement of operations and other changes in net assets is mainly composed of administrative agent and transfer agent fees. Note 4 - Subscription duty ("Taxe d abonnement") The Company is governed by Luxembourg law. Pursuant to the legislation and regulations in force, the Company is subject to an annual taxe d abonnement of 0.05% which is payable quarterly and calculated on the basis of the net assets of each Sub-Fund on the last day of each quarter. The Company obtains the reduced tax rate of 0.01% in respect of Institutional shares. Institutional shares are reserved for investments made by investors which qualify as institutional investors within the meaning of, and as provided for, in article 174 of the amended law of 17th December Pursuant to Article 175 (a) of the amended law of 17th December 2010 the net assets invested in undertakings for collective investment already subject to the "taxe d abonnement" are exempt from this tax. Note 5 - Forward foreign exchange contracts As at 30th June 2016, the following forward foreign exchange contracts are outstanding with SAXO BANK A/S, except for the forward foreign exchange contract with maturity of LS FUND - Global Dynamic Opportunities 10+ (formerly NORTHERN STAR - Global Dynamic Opportunities 10+ Fund) which is outstanding with KBL EUROPEAN PRIVATE BANKERS S.A.: LS FUND - Global Dynamic Opportunities 10+ (formerly NORTHERN STAR - Global Dynamic Opportunities 10+ Fund) Currency Purchases Currency Sales Maturity Unrealised result (in EUR) EUR 1,210, USD 1,344, , EUR 3,400, NOK 32,116, , NOK 31,686, EUR 3,400, ,