Fidelity Canadian Bond Fund

Transcription

1 Fidelity Canadian Bond Fund Annual Report June 30, 2017

2 Fidelity Canadian Bond Fund Schedule of Investments June 30, 2017 Showing Percentage of Net Assets Attributable to Securityholders (Net Assets) Bonds 98.5% Domestic Bonds 93.1% Corporate 45.1% Aeroports de Montreal: 3.919% 9/26/42 $ 22,153 $ 21,683 $ 25, % 9/17/35 11,600 11,840 15,011 Alectra, Inc % 5/17/27 20,210 20,210 19,879 Alimentation Couche Tard, Inc.: 3.6% 6/2/25 13,850 13,850 14, % 8/21/20 13,030 13,499 13,836 Alliance Pipeline LP: 4.928% 12/16/19 1,640 1,661 1, % 12/31/23 2,821 3,026 3, % 12/31/ Allied Properties (REIT) 3.934% 11/14/22 13,920 14,109 14,303 AltaGas Ltd.: 3.57% 6/12/23 4,000 4,141 4, % 9/28/21 19,640 20,075 20, % 6/1/20 6,000 6,000 6, % 4/7/26 9,180 9,757 9, % 3/15/ % 1/17/19 8,000 8,000 8,324 AltaLink Investments LP: 3.265% 6/5/20 10,800 10,799 11, % 6/5/19 23,650 23,650 24,346 AltaLink LP: 2.747% 5/29/26 5,880 5,981 5, % 6/30/45 10,770 10,770 12,013 Aon Finance NS 1 ULC 4.76% 3/8/18 54,158 54,682 55,312 Bank of Montreal: 1.61% 10/28/21 59,700 59,362 58, % 3/31/21 8,470 8,470 8, % 10/6/20 21,840 21,836 22, % 9/19/24 (a) 32,170 32,375 32, % 12/8/25 (Reg. S) (a) 29,320 29,498 30,220 Bank of Nova Scotia: 1.9% 12/2/21 17,000 16,995 16, % 9/9/20 46,680 47,048 46, % 1/13/20 24,540 24,968 24, % 6/28/24 33,610 33,608 33, % 10/28/19 60,450 60,943 61, % 3/30/27 (a) 23,900 23,894 23, % 8/3/22 (a) 11,200 11,428 11,214 Bell Canada: 3% 10/3/22 8,170 8,137 8, % 6/17/20 12,520 12,511 12, % 3/22/23 8,685 8,680 9, % 6/12/20 11,520 11,661 12, % 3/2/26 5,940 5,918 6, % 9/11/23 26,505 28,164 29, % 5/19/21 12,800 12,753 14, % 2/26/37 $ 26,555 $ 26,348 $ 33, % 5/1/29 1,480 1,705 1,871 7% 9/24/27 1,101 1,041 1,440 BMO Subordinated Notes Trust 5.75% 9/26/22 (a) 46,388 49,772 46,845 BMW Canada Auto Trust: Series : Class A2, 1.68% 8/20/19 23,150 23,180 23,141 Class A3, 1.866% 4/20/21 11,520 11,520 11,520 Series Class A2, 1.677% 5/20/20 12,300 12,300 12,245 BMW Canada, Inc.: 1.78% 10/19/20 7,000 6,998 6, % 6/15/21 8,280 8,276 8, % 12/11/20 9,210 9,210 9,170 Bow Centre Street LP 3.797% 6/13/23 39,100 39,226 37,981 BP LP 3.244% 1/9/20 16,973 16,973 17,259 British Columbia Ferry Services, Inc % 3/20/37 5,450 5,066 6,797 Broadcast Centre Trust 7.53% 5/1/27 22,222 26,921 28,202 Calloway (REIT): 3.556% 2/6/25 5,440 5,458 5, % 2/11/21 5,500 5,517 5, % 5/30/23 20,140 20,169 20, % 7/27/20 6,630 6,635 6,949 Cameco Corp.: 4.19% 6/24/24 21,900 21,891 22, % 9/2/19 15,120 15,464 15,972 Canada Post Corp. 4.36% 7/16/40 30,841 34,240 39,039 Canadian Commercial Mortgage Origination Trust Series Class A, 2.186% 6/12/20 12,877 12,877 12,799 Canadian Credit Card Trust II 1.829% 3/24/22 3,500 3,500 3,503 Canadian Imperial Bank of Commerce: 1.64% 7/12/21 17,330 17,323 17, % 1/20/20 25,160 25,155 25, % 4/26/21 27,680 27,666 27,634 3% 10/28/24 (a) 39,340 39,583 40, % 1/26/26 (a) 16,200 16,755 16,688 6% 6/6/23 (a) 18,585 18,556 19,338 Canadian Natural Resources Ltd.: 2.05% 6/1/20 21,120 21,115 20, % 8/14/20 7,570 7,574 7, % 6/19/19 10,400 10,393 10,570 Annual Reportport 2

3 Bonds continued Domestic Bonds continued Corporate continued Canadian Natural Resources Ltd.: continued 3.31% 2/11/22 $ 50,610 $ 50,631 $ 51, % 5/30/47 8,980 8,980 8,788 CBC Monetization Trust 4.688% 5/15/27 13,126 14,465 14,633 Centre Street Trust (REIT): 3.69% 6/14/21 12,220 12,196 12, % 6/14/22 6,278 6,278 6,175 Choice Properties LP: 3.6% 4/20/20 1,820 1,846 1, % 9/20/21 8,920 9,106 9, % 9/20/22 23,020 22,835 23,915 Choice Properties REIT: 4.055% 11/24/25 2,800 2,800 2, % 2/8/24 18,400 19,291 19,687 CI Financial Corp.: 2.645% 12/7/20 48,698 48,893 49, % 11/25/21 19,650 19,650 19,778 CMLS Issuer Corp.: sequential payer Series : Class A1, 2.659% 12/12/47 11,986 11,984 12,017 Class A2, 3.421% 12/12/47 29,220 29,219 29,244 Series Class X, % 12/12/47 (a)(b) 141,752 6,167 5,972 CNH Capital Canada Receivables Trust: Series Class A2, 1.941% 10/15/ Series Class A2, 1.804% 10/15/20 5,396 5,397 5,408 Series Class A2, 1.353% 3/15/21 11,388 11,378 11,370 Cominar (REIT): 3.62% 6/21/19 3,120 3,136 3, % 6/1/22 18,130 18,356 17, % 5/23/23 20,710 20,796 19, % 12/8/21 7,240 7,442 7, % 7/27/20 1,700 1,784 1,728 CPPIB Capital, Inc. 1.1% 6/10/19 31,080 31,057 30,922 CT (REIT): 2.159% 6/1/21 (Reg. S) 8,000 8,000 7, % 6/9/22 7,973 7,973 7, % 6/9/25 9,436 9,634 9,545 CU, Inc % 7/27/45 22,030 23,244 24,080 Daimler Canada Finance, Inc. 1.42% 10/2/18 7,985 7,983 7,961 Dollarama, Inc.: 2.203% 11/10/22 $ 5,720 $ 5,720 $ 5, % 7/22/21 13,840 13,840 13,865 Dream Office (REIT): 3.424% 6/13/18 11,700 11,694 11, % 1/21/20 16,500 16,529 16,700 Emera, Inc. 2.9% 6/16/23 22,040 22,040 22,263 Enbridge Gas Distribution, Inc.: 2.5% 8/5/26 4,370 4,367 4,308 4% 8/22/44 (Reg. S) 1,697 1,577 1,832 Enbridge Income Fund Holdings, Inc.: 3.94% 1/13/23 14,330 14,327 15,172 4% 12/20/18 8,850 8,850 9, % 2/22/19 15,260 15,351 15, % 11/12/20 5,825 5,820 6, % 2/22/22 17,510 17,571 19,168 Enbridge Pipelines, Inc.: 3% 8/10/26 5,610 5,609 5, % 11/12/19 2,570 2,711 2, % 9/29/45 7,150 7,106 7,895 Enbridge, Inc.: 3.16% 3/11/21 14,000 13,997 14, % 8/27/42 32,980 32,544 31, % 2/1/21 8,625 8,836 9, % 3/9/20 8,104 8,643 8, % 9/2/19 3,700 3,698 3,913 ENMAX Corp. 6.15% 6/19/18 17,618 17,992 18,327 Finning International, Inc % 7/3/20 10,020 10,090 10,244 First Capital Realty, Inc.: 3.9% 10/30/23 11,775 11,739 12, % 1/31/22 22,830 23,767 24, % 8/30/18 1,469 1,491 1, % 7/30/19 3,500 3,501 3,729 Ford Auto Securitization Trust: Series 2013 R4: Class A3, 2.275% 10/15/18 2,838 2,848 2,842 Class C, 3.175% 6/15/19 3,078 3,078 3,083 Series 2014 R2 Class A3, 1.972% 3/15/19 11,361 11,380 11,340 Series 2015 R4: Class A2, 1.671% 8/15/19 9,562 9,562 9,577 Class A3, 2% 11/15/20 12,960 12,964 12,999 Series 2017 R2: Class A2, 1.423% 4/15/21 9,470 9,470 9,418 3 Annual Report

4 Fidelity Canadian Bond Fund Schedule of Investments continued Bonds continued Domestic Bonds continued Corporate continued Ford Auto Securitization Trust: continued Series 2017-R2: continued Class A3, 1.772% 8/15/22 $ 9,460 $ 9,460 $ 9,365 Ford Credit Canada Ltd.: 2.45% 5/7/20 40,146 40,151 40, % 5/10/21 19,990 19,996 19, % 2/23/22 15,090 15,090 14, % 9/16/20 15,290 15,465 15, % 8/2/18 18,202 18,317 18,548 Fortis, Inc. 2.85% 12/12/23 12,090 12,088 12,202 FortisAlberta, Inc.: 3.3% 9/30/24 20,000 21,491 21, % 9/22/45 2,750 2,747 3, % 4/15/38 3,280 3,463 4,369 FortisBC Energy, Inc. 2.58% 4/8/26 4,860 4,857 4,849 FortisBC, Inc. 6.1% 6/2/39 2,750 2,750 3,785 General Motors Financial of Canada Ltd. 3.08% 5/22/20 26,790 26,972 27,262 GMF Canada Leasing Trust Series : Class A2, 1.63% 3/20/19 6,290 6,290 6,290 Class A3, 1.828% 6/21/21 6,730 6,730 6,726 Granite REIT Holdings LP: 3.788% 7/5/21 3,600 3,735 3, % 11/30/23 42,568 43,512 43,073 Great West Lifeco, Inc % 11/16/39 7,280 7,337 9,772 Greater Toronto Airports Authority: 4.53% 12/2/41 12,092 12,459 15, % 10/15/32 1,945 2,451 2,890 H&R (REIT): 3.369% 1/30/24 8,000 8,060 7, % 3/2/20 20,450 20,877 21,360 HCN Canadian Holdings 1 LP 3.35% 11/25/20 7,170 7,151 7,344 Honda Canada Finance, Inc.: 1.823% 12/7/21 25,000 25,000 24, % 2/18/21 11,050 11,050 11, % 7/15/22 5,730 5,730 5,712 HSBC Bank of Canada: 1.816% 7/7/20 6,970 6,916 6, % 11/26/18 21,061 21,061 21, % 6/29/22 10,130 10,130 10, % 1/29/21 26,260 26,272 26,599 Hydro One, Inc.: 2.77% 2/24/26 $ 2,880 $ 2,879 $ 2, % 2/23/46 19,910 20,220 21, % 3/13/37 3,650 4,473 4,388 IGM Financial, Inc. 7.35% 4/8/19 9,480 9,805 10,314 Institutional Mortgage Securities Canada, Inc.: sequential payer: Series : Class A1, 3.69% 2/12/ Class A2, 4.697% 2/12/44 28,220 29,092 30,420 Series Class A1, 2.551% 7/12/45 5,108 5,107 5,125 Series : Class B, 5.259% 2/12/44 3,900 4,179 4,243 Class C, 5.276% 2/12/44 (a) 4,000 3,994 4,312 Class X, % 2/12/44 (a)(b) 77,320 1,183 1,235 Series : Class A1, 2.153% 11/12/ Class A2, 2.607% 12/12/19 21,390 21,387 21,434 Series Class A1, 2.837% 4/12/23 24,109 24,143 24,334 Series : Class A1, 2.003% 7/12/47 8,155 8,134 8,149 Class X, % 7/12/47 (a)(b) 102,185 3,129 3,036 Series Class A1, 1.936% 9/12/24 13,221 13,179 12,907 Series : Class A2, 2.778% 3/12/25 13,240 13,239 12,758 Class X, 1.469% 1/12/35 (a) 167,383 10,197 9,720 Series : Class A1, 2.34% 2/12/25 18,173 18,172 17,793 Class A2, 3.059% 9/12/26 20,660 20,659 20,152 Class X, % 10/12/26 (a)(b) 199,312 10,372 10,181 Intact Financial Corp.: 2.85% 6/7/27 (Reg. S) 15,050 15,047 14, % 8/18/21 5,910 5,907 6, % 6/16/42 9,690 9,808 11, % 11/23/39 11,804 12,413 16,274 Inter Pipeline Ltd.: 2.608% 9/13/23 19,860 19,860 19, % 7/20/20 15,045 15,323 15,604 Annual Reportport 4

5 Bonds continued Domestic Bonds continued Corporate continued Inter Pipeline Ltd.: continued 3.484% 12/16/26 $ 14,450 $ 14,450 $ 14, % 5/30/22 16,150 16,150 16, % 5/30/44 12,600 12,604 13, % 2/2/21 13,000 13,985 14,145 Investors Group, Inc. 6.65% 12/13/27 11,626 13,533 14,900 John Deere Canada Funding, Inc.: 1.85% 3/24/21 14,270 14,269 14, % 9/17/20 (Reg. S) 10,690 10,683 10,708 Labrador Island Link Funding Trust 3.76% 6/1/33 18,335 18,628 20,839 Loblaw Companies Ltd.: 4.86% 9/12/23 13,550 13,550 15, % 6/9/34 7,328 7,763 9, % 1/29/35 2,406 2,430 3, % 1/22/ % 6/7/40 11,310 11,940 14,770 Lower Mattagami Energy LP 2.307% 10/21/26 2,000 2,000 1,955 Maritimes & Northeast Pipeline LP 4.34% 11/30/ MBARC Credit Canada, Inc. Series 2015 A Class A3, 1.549% 2/18/20 8,322 8,322 8,323 McGill University Health Centre 5.36% 12/31/43 24,040 27,328 31,279 Merrill Lynch Financial Asset, Inc.: sequential payer Series 2002 BC2P Class A, 6.673% 5/7/ Series 2002 CAN8 Class X1, % 11/12/34 (a)(b) Series 2006 B Class X, % 10/12/39 (a)(b) 21, Series 2007 CA23 Class A3, 5.487% 5/12/44 13,657 15,138 13,700 Metro, Inc.: 5.03% 12/1/44 6,680 6,677 7, % 10/15/35 14,912 16,980 18,442 Muskrat Falls 3.63% 6/1/29 14,875 15,081 16,543 National Bank of Canada 1.809% 7/26/21 18,000 18,000 17,844 NAV Canada 7.56% 3/1/27 2,573 3,099 3,259 Newfoundland & Labrador Hydro 3.6% 12/1/45 $ 14,640 $ 14,528 $ 15,348 North West Redwater Partnership/NWR Finanancing Co. Ltd.: 2.1% 2/23/22 19,670 19,630 19, % 7/22/24 12,490 12,498 12, % 2/23/43 16,800 16,739 16,399 Northwest Territories Power Corp. 5.16% 9/13/40 4,748 4,748 5,555 Nova Scotia Power, Inc. 4.5% 7/20/43 3,050 3,592 3,507 Omers Realty Corp. 3.04% 12/5/17 23,071 23,071 23,117 Ontario School Boards Financing Corp. 7.2% 6/9/25 8,766 10,600 10,525 OPB Finance Trust: 1.88% 2/24/22 5,250 5,248 5, % 2/2/26 (Reg. S) 5,637 5,634 5, % 1/25/27 19,330 19,320 19,775 Pembina Pipeline Corp.: 3.54% 2/3/25 7,200 7,286 7, % 8/11/26 14,820 14,814 15, % 10/24/22 7,750 7,749 8, % 6/15/27 5,420 5,420 5, % 4/30/43 12,690 12,549 12, % 3/25/44 11,740 11,770 12,025 Plenary Health Care Partnerships Humber LP: 4.822% 11/30/44 13,139 13,474 15, % 5/31/39 3,759 3,759 4,179 Power Corp. of Canada: 4.81% 1/31/47 4,570 4,570 5, % 4/22/19 3,490 3,566 3, % 4/22/ Real Estate Asset Liquidity Trust: sequential payer Series Class A2, 2.572% 9/12/51 16,250 16,249 15,876 Series Class XC1, % 9/12/38 (a)(b) Series Class XC2, % 12/12/38 (a)(b) 6, Series Class XC2, % 4/12/23 (a)(b) 22, Series : Class A2, 3.239% 5/12/50 17,069 17,068 17,140 Class X, 0.779% 5/12/50 (a)(b) 132,613 4,661 4,592 5 Annual Report

6 Fidelity Canadian Bond Fund Schedule of Investments continued Bonds continued Domestic Bonds continued Corporate continued Real Estate Asset Liquidity Trust: continued Series : Class A1, 2.325% 5/12/51 $ 18,976 $ 18,975 $ 18,736 Class A2, 3.179% 5/12/51 12,320 12,319 12,286 Class X, % 5/12/51 (a)(b) 224,799 9,502 9,374 Series Class X, 1.121% 9/12/51 (a)(b) 132,011 6,386 6,358 RioCan (REIT): 2.185% 8/26/20 5,000 5,000 4, % 4/9/21 5,970 5,970 5, % 2/12/24 11,360 11,213 11, % 6/1/20 8,180 8,204 8, % 12/13/21 24,570 24,878 25, % 4/18/23 4,190 4,198 4, % 5/30/22 14,860 15,591 15,493 Rogers Communications, Inc.: 5.34% 3/22/21 15,780 16,828 17, % 8/25/40 11,840 13,256 15, % 3/22/41 9,500 10,557 12, % 11/4/39 6,880 7,510 9,290 Royal Bank of Canada: 1.583% 9/13/21 32,780 32,780 32, % 7/17/20 36,250 36,460 36, % 3/15/21 51,450 51,547 51, % 12/9/19 59,660 60,886 60, % 6/4/25 (a) 10,275 10,273 10, % 12/11/18 5,840 5,838 5, % 10/11/18 25,460 25,779 25, % 7/17/24 (a) 69,850 69,892 71, % 9/29/26 (a) 16,240 16,242 16,790 Royal Office Finance LP Series A, 5.209% 11/12/37 39,232 45,331 48,031 SCG Hotel Issuer, Inc. Series 2013 CWP Class A2, 3.442% 10/12/18 1,100 1,100 1,112 Schooner Trust: Series Class XC, % 10/12/38 (a)(b) 4, Series Class XC, % 2/12/22 (a)(b) 4, Series Class XC, % 6/12/22 (a)(b) Sea to Sky Highway Investment LP 2.629% 10/31/30 11,824 11,823 11,544 SEC LP/Arci Ltd % 8/29/33 $ 23,675 $ 23,675 $ 24,542 Shaw Communications, Inc.: 3.8% 3/1/27 8,730 8,721 8, % 1/31/24 12,950 12,947 14, % 12/7/20 37,300 40,688 41, % 10/1/19 25,453 27,288 27, % 11/9/39 22,050 25,944 28,485 Smart (REIT) 2.987% 8/28/24 8,660 8,508 8,400 Sobeys, Inc.: 4.7% 8/8/23 18,450 18,450 19, % 10/29/ % 6/7/40 10,390 10,763 11, % 2/26/18 3,300 3,383 3,400 SP LP/SP1 LP 3.21% 6/15/19 11,776 11,776 11,956 Sun Life Financial, Inc.: 3.05% 9/19/28 (a) 21,000 20,970 21, % 2/19/26 (a) 20,340 20,317 20,933 Suncor Energy, Inc.: 3% 9/14/26 14,770 14,733 14, % 9/13/46 11,510 11,498 12, % 3/26/37 5,400 6,056 6, % 5/22/18 11,795 11,792 12,235 TELUS Corp.: 3.2% 4/5/21 11,480 11,450 11, % 3/15/23 11,520 11,811 11, % 4/1/24 6,000 6,234 6, % 1/17/25 5,910 6,006 6, % 4/1/43 16,220 16,187 16, % 4/5/44 7,150 7,141 7, % 12/4/19 11,719 12,354 12, % 7/23/20 10,000 10,918 10,867 Teranet Holdings LP: 3.646% 11/18/22 5,740 5,740 5, % 12/16/20 28,985 30,151 30, % 12/17/40 4,578 4,816 5,028 Terasen Gas Vancouver Island, Inc.: 5.2% 12/6/40 7,200 7,179 9, % 2/15/38 18,011 21,017 24,678 Terasen Gas, Inc. 5.9% 2/26/ The Hospital for Sick Children 5.217% 12/16/49 10,620 10,996 13,975 The Toronto Dominion Bank: 1.693% 4/2/20 64,850 64,941 64, % 3/23/22 26,090 26,090 25, % 3/8/21 49,380 49,505 49, % 12/22/21 (Reg. S) 6,860 6,982 7, % 6/24/25 (a) 35,670 35,681 36,046 Annual Reportport 6

7 Bonds continued Domestic Bonds continued Corporate continued The Toronto-Dominion Bank: continued 2.982% 9/30/25 (a) $ 18,640 $ 18,547 $ 19, % 7/9/23 (a) 17,258 18,844 17,977 Toronto Hospital 5.64% 12/8/ Toyota Credit Canada, Inc.: 1.75% 7/21/21 7,500 7,487 7, % 2/28/22 9,600 9,597 9, % 5/20/20 17,250 17,349 17, % 5/23/19 22,300 22,260 22, % 11/21/18 9,500 9,659 9,655 TransCanada PipeLines Ltd.: 3.69% 7/19/23 5,820 6,198 6, % 6/6/46 2,460 2,454 2, % 1/15/ Union Gas Ltd.: 2.81% 6/1/26 18,203 18,694 18, % 9/17/25 1,940 1,939 2, % 6/1/46 4,300 4,298 4, % 6/2/44 1,740 1,710 1, % 4/27/18 2,965 2,961 3,059 Ventas Canada Finance Ltd.: 3.3% 2/1/22 6,170 6,170 6, % 9/30/24 (Reg. S) 34,638 35,046 36,618 Veresen, Inc.: 3.43% 11/10/21 45,051 45,137 46,349 4% 11/22/18 10,660 10,656 10,958 Wells Fargo Financial Canada Corp. 2.78% 11/15/18 9,860 9,857 10,015 West Edmonton Mall Property, Inc.: 4.056% 2/13/24 30,614 30,614 31, % 2/13/24 27,300 27,499 28,280 Westcoast Energy, Inc.: 3.883% 10/28/21 5,370 5,382 5, % 1/16/19 9,510 9,503 10, % 7/21/25 2,220 2,395 3,073 Winnipeg Airport Authority, Inc % 9/28/40 1,059 1,059 1,270 WTH Car Rental ULC: Series 2014: 2.542% 8/20/19 18,980 18,980 19, % 8/20/19 3,800 3,800 3, % 7/20/20 12,300 12,300 12,163 Yukon Development Corp. 5% 6/29/40 13,940 14,847 18,222 4,803,872 4,924,697 Federal 14.5% Canada Housing Trust No. 1: 1.2% 6/15/20 $ 86,890 $ 86,804 $ 86, % 6/15/21 74,370 74,514 73, % 12/15/21 125, , , % 6/15/22 170, , , % 9/15/26 44,950 44,120 43, % 6/15/27 93,850 95,678 94, % 6/15/27 74,410 76,341 75, % 3/15/25 37,550 38,684 38,815 Canadian Government: Real Return Bond 1.25% 12/1/47 80,108 90,779 94, % 6/1/23 11,440 11,447 11, % 6/1/22 9,570 10,223 10, % 12/1/48 93, , , % 12/1/45 70,215 87,357 90,035 5% 6/1/37 170, , , % 6/1/33 127, , ,954 Farm Credit Canada 4.55% 4/12/21 10,690 10,708 11,772 NHA Mortgage-Backed Securities 1.43% 1/1/21 27,720 27,727 27, % 6/1/21 8,648 8,644 8, % 10/1/21 13,195 13,169 13, % 3/1/22 53,325 53,102 52,882 1,573,398 1,577,699 Municipal 5.6% Centre Hospitalier de l Universite de Montreal 4.448% 10/1/49 7,050 7,050 8,235 City of Montreal: 2.75% 9/1/26 13,500 13,435 13,643 3% 9/1/25 20,880 21,000 21, % 9/1/23 28,640 28,158 30, % 12/1/32 12,800 12,840 14, % 12/1/21 47,800 51,827 52,863 City of Toronto: 3.5% 12/6/21 28,840 28,953 30, % 9/29/23 43,615 43,613 47, % 6/10/41 4,850 4,829 5, % 7/18/27 5,760 6,142 6,577 Concordia University 6.55% 9/2/42 12,850 16,256 19,071 Durham District School Board 6.75% 11/19/19 24,949 27,445 27,758 Durham Regional Municipality 5.05% 1/25/20 1,209 1,204 1,313 McGill University 6.15% 9/22/42 8,909 10,580 12,868 7 Annual Report

8 Fidelity Canadian Bond Fund Schedule of Investments continued Bonds continued Domestic Bonds continued Municipal continued Municipal Finance Authority of British Columbia: 1.65% 4/19/21 $ 52,470 $ 52,388 $ 51, % 4/19/26 50,960 50,852 50,561 Peel Regional Municipality: 3.85% 10/30/42 13,420 13,344 14, % 12/2/33 24,420 24,323 27, % 6/29/40 13,950 14,748 18,026 Queens University 6.1% 11/19/32 3,580 4,093 4,758 Regional Municipality of York: 4% 6/30/21 12,910 13,202 13, % 6/30/20 8,170 8,818 8,814 Simcoe County District School Board of Ed. 6.8% 6/19/26 4,520 5,173 5,935 Simon Fraser University 5.613% 6/10/43 5,820 6,853 7,993 The University of British Columbia 4.817% 7/26/35 4,000 4,138 4,755 University of Ontario Institute of Technology 6.351% 10/15/34 1,728 1,728 2,045 University of Ottawa 6.28% 4/15/43 1,151 1,289 1,707 University of Toronto Governing Council: 4.251% 12/7/51 23,185 23,450 26, % 7/18/31 7,000 8,406 9,706 University of Western Ontario 4.798% 5/24/47 7,022 7,553 8,730 University of Windsor 5.37% 6/29/46 11,570 12,881 15,261 York Region District School Board: 5.3% 6/3/25 1,513 1,573 1, % 4/12/23 16,080 18,346 19,590 York University: 5.841% 5/4/44 6,370 7,676 8, % 3/7/42 12,650 17,001 18, , ,870 Provincial 27.9% Alberta Province: 1.35% 9/1/21 107, , , % 6/1/25 165, , , % 6/1/27 79,440 80,343 79, % 12/1/48 10,950 11,106 10,917 Manitoba Province: 1.6% 9/5/20 30,000 29,930 29, % 9/5/46 35,400 35,023 33, % 3/5/43 19,780 19,209 20,661 Annual Reportport % 9/5/45 $ 43,950 $ 45,437 $ 51, % 3/5/41 19,500 18,469 22, % 3/5/42 1,740 1,738 2, % 3/5/40 12,225 11,326 15,402 New Brunswick Province: 3.55% 6/3/43 48,485 44,878 51, % 8/14/45 24,210 26,539 27, % 3/26/37 2,330 2,163 2, % 9/26/35 6,600 6,371 8, % 9/26/39 2,250 2,209 2,858 Newfoundland Province: 3.3% 10/17/46 9,420 8,516 9, % 10/17/29 8,630 9,148 11, % 10/17/30 1,000 1,040 1,387 Nova Scotia Province: 1.048% 8/15/18 (a) 15,260 15,260 15, % 6/1/27 74,530 72,923 71, % 11/25/19 50,000 53,533 53, % 6/1/37 4,805 4,622 5, % 6/1/35 16,690 19,815 21, % 6/1/33 1,270 1,403 1, % 12/1/ ,123 Ontario Infrastructure Project Corp. 4.7% 6/1/37 2,100 2,011 2,530 Ontario Province: 2.6% 6/2/25 80,965 82,789 82, % 6/2/27 20,000 20,279 20, % 6/2/48 96,540 92,181 93, % 6/2/23 164, , , % 12/2/46 68,540 68,522 67, % 6/2/22 29,490 31,490 31, % 6/2/45 73,055 79,073 79, % 6/2/43 85,280 82,260 93,602 4% 6/2/21 121, , , % 6/2/20 239, , , % 6/2/41 2,340 2,860 3, % 6/2/37 63,380 78,651 80, % 6/2/35 18,810 25,702 26, % 3/8/29 40,000 54,669 55,483 Ontario School Boards Financing Corp.: 4.789% 8/8/30 5,993 6,293 6, % 4/18/31 7,358 7,450 8, % 6/25/32 9,749 10,492 11, % 11/26/29 22,627 25,560 26, % 10/11/ Prince Edward Island Province: 2.35% 8/25/25 28,200 28,155 27, % 6/27/42 21,750 21,986 22, % 9/2/20 8,850 8,803 9, % 9/24/19 3,480 3,476 3, % 5/19/41 17,315 17,582 21, % 11/19/37 7,840 7,718 9, % 2/21/34 1,540 1,534 2,031

9 Bonds continued Domestic Bonds continued Provincial continued Prince Edward Island Province: continued 6.1% 7/29/27 $ 2,240 $ 2,455 $ 2, % 1/29/32 3,490 3,532 4,783 Province of British Columbia: 2.8% 6/18/48 57,170 56,378 56, % 6/18/25 50,390 52,039 52, % 6/18/44 63,730 66,608 67,153 Province of Quebec: 2.75% 9/1/25 47,340 47,754 48, % 9/1/27 16,440 16,444 16, % 12/1/48 3,360 3,678 3, % 9/1/24 134, , , % 12/1/21 41,785 45,044 46, % 12/1/43 56,110 55,086 69, % 12/1/20 48,430 53,738 53,024 5% 12/1/38 37,200 42,405 49,571 5% 12/1/41 92, , , % 6/1/25 15,065 16,091 18, % 6/1/32 16,150 20,001 22,940 Saskatchewan Province: 2.65% 6/2/27 13,000 12,970 13, % 12/2/46 37,070 35,944 35, % 6/2/48 11,450 11,412 12, % 6/2/45 15,630 16,814 18, % 1/25/30 5,835 6,681 7,964 2,941,473 3,041,861 TOTAL DOMESTIC BONDS 9,889,910 10,160,127 Foreign Bonds 5.4% Anheuser Busch InBev Finance, Inc.: 2.6% 5/15/24 18,330 18,325 18, % 1/25/23 14,310 14,974 14, % 5/15/47 11,480 11,480 11,997 Aviva PLC 4.5% 5/10/21 Reg. S 19,030 18,963 20,203 Bank of America Corp.: 2.604% 3/15/23 (a) 38,510 38,510 38, % 6/22/22 16,110 16,110 16,550 Bayview Commercial Asset Trust Series 2006 CD1X Class B2, 2.848% 7/25/23 (a) BHP Billiton Finance Ltd. 3.23% 5/15/23 12,000 11,993 12,285 BP Capital Markets PLC 3.497% 11/9/20 15,510 15,741 16,098 Citigroup, Inc.: 3.39% 11/18/21 18,640 18,635 19, % 10/11/22 (a) 6,815 6,902 6,821 Goldman Sachs Group, Inc % 4/26/23 (a) $ 16,700 $ 16,700 $ 16,432 HSBC Holdings PLC 3.196% 12/5/23 13,950 13,958 14,175 JPMorgan Chase & Co.: 1.855% 2/22/21 (a) 9,420 9,340 9, % 3/5/21 35,730 36,844 36,718 Metropolitan Life Global Funding I: 2.682% 4/16/19 (Reg S.) 25,860 25,986 26, % 6/11/20 11,676 12,096 12,030 Molson Coors International LP: 2.75% 9/18/20 5,580 5,668 5, % 7/15/23 13,680 13,677 13, % 7/15/26 17,320 17,315 17,408 Morgan Stanley: 1.75% 12/29/20 (a) 30,000 30,000 30,058 3% 2/7/24 24,330 24,325 24, % 8/5/21 35,740 36,310 36,784 National Grid Electricity Transmission PLC 2.9% 11/26/19 23,000 23,000 23,519 Sydney Airport Finance Co. Property Ltd % 7/27/18 36,410 36,843 37,495 TD Banknorth, N.A % 9/20/22 (a) 35,900 36,615 36,148 Wells Fargo & Co.: 2.094% 4/25/22 36,820 36,820 36, % 3/15/21 9,700 9,777 9, % 10/27/23 6,650 6,657 6, % 5/19/26 18,150 17,869 17,816 TOTAL FOREIGN BONDS 581, ,258 TOTAL BONDS 10,471,509 10,745,385 Preferred Securities 1.0% FINANCIALS 1.0% Manulife Financial Capital Trust II 7.405% 12/31/2108 (a) 3,200 3,200 3,589 NBC Asset Trust: 7.235% (a)(c) 4,050 4,383 4, % (a)(c) 1,950 2,345 2,186 Scotiabank Tier I Trust 7.802% 6/30/2108 (a) 23,583 27,541 26,009 TD Capital Trust III 7.243% (a)(c) 14,145 16,421 15,250 9 Annual Report

10 Fidelity Canadian Bond Fund Schedule of Investments continued Preferred Securities continued FINANCIALS continued TD Capital Trust IV 6.631% 6/30/2108 (a) $ 8,890 $ 9,304 $ 10,170 The Toronto Dominion Bank 5.763% 12/18/2106 (a) 43,987 48,537 44,933 TOTAL FINANCIALS 111, ,395 TOTAL PREFERRED SECURITIES 111, ,395 Short-Term Investments 0.0% Canada 0.0% Investments in reverse repurchase agreements in a joint trading account at 0.47%, dated 6/30/17 due 7/4/17 (Collateralized by Canadian Government Obligations) # 6,659 6,659 6,659 TOTAL INVESTMENT PORTFOLIO 99.5% $10,589,899 10,858,439 NET OTHER ASSETS (LIABILITIES) 0.5% 52,937 NET ASSETS 100% $ 10,911,376 Presentation Notes amount includes broker commissions and other trading expenses, if any. is stated in Canadian dollars unless otherwise noted. Legend (a) Coupon rates for floating and adjustable rate securities reflect the rates in effect at period end. (b) Security represents right to receive monthly interest payments on an underlying pool of mortgages or assets. shown is the outstanding par amount of the pool as of the end of the period. (c) Security is perpetual in nature with no stated maturity date. Investment Valuation The following is a summary of the inputs used, as of June 30, 2017 and June 30, 2016, involving the Fund s assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the tables below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements. Valuation Inputs at June 30, 2017: Description Total Level 1 Level 2 Level 3 (s in thousands) Investments in Securities: Bonds $10,745,385 $ $10,745,225 $ 160 Preferred Securities 106, ,395 Short-Term Investments 6,659 6,659 Total Investments in Securities: $10,858,439 $ $10,858,279 $ 160 Annual Reportport 10

11 Valuation Inputs at June 30, 2016: Description Total Level 1 Level 2 Level 3 (s in thousands) Investments in Securities: Bonds $10,264,944 $ $10,264,944 $ Preferred Securities 147, ,681 Short-Term Investments 77,390 77,390 Total Investments in Securities: $10,490,015 $ $10,490,015 $ The following is a reconciliation of Investments in Securities for which Level 3 inputs were used in determining value: (s in thousands) Investments in Securities: Beginning Balance $ Net Realized Gain (Loss) on Investment Securities Net Unrealized Gain (Loss) on Investment Securities 118 of Purchases 141 Proceeds of Sales (873) Amortization/Accretion Transfers into Level Transfers out of Level 3 Ending Balance $ 160 The change in unrealized gain (loss) for the period attributable to Level 3 securities held at June 30, 2017 $ 118 The information used in the above reconciliation represents fiscal year to date activity for any Investments in Securities identified as using Level 3 inputs at either the beginning or the end of the current fiscal period. Transfers in or out of Level 3 represent the beginning value of any Security or Instrument where a change in the pricing level occurred from the beginning to the end of the period. The cost of purchases and the proceeds of sales may include securities received or delivered through corporate actions or exchanges. Realized and unrealized gains (losses) disclosed in the reconciliation are included in Net Gain (Loss) on Investments on the Statements of Comprehensive Income. Other Information # Additional information on each counterparty to the reverse repurchase agreement is as follows: Repurchase Agreement / Counterparty Value $6,659,000 due 7/04/17 at 0.47% Bank of Montreal $ 681 CIBC World Markets, Inc. 795 Royal Bank of Canada 1,590 Scotia Capital, Inc. 2,839 The Toronto-Dominion Bank 754 $ 6, Annual Report

12 Financial Statements Statements of Financial Position s in thousands of Canadian Dollars (except per security amounts) As at June 30, 2017 June 30, 2016 Current assets (Note 3) Investments at fair value through profit or loss $ 10,858,439 $ 10,490,015 Cash 2,583 6,002 Receivable for investments sold 72, ,495 Accrued interest and dividends receivable 60,211 57,382 Subscriptions receivable 21,692 9,318 11,014,960 10,668,212 Current liabilities (Note 3) Payable for investments purchased 95, ,345 Redemptions payable 7,535 35,484 Distributions payable (Note 5) Management and advisory fees payable (Note 4) Other payables to affiliates (Note 4) Other payables and accrued expenses (Notes 4 and 5) , ,476 Net assets attributable to securityholders (Notes 3 and 6) $ 10,911,376 $ 10,529,736 Net assets attributable to securityholders per Series and per security (Note 6) Series A: ($83,827 and $112,461, respectively) $ $ Series B: ($224,544 and $258,175, respectively) $ $ Series F: ($56,896 and $55,690, respectively) $ $ Series O: ($10,496,345 and $10,074,095, respectively) $ $ Series E1: ($30,894 and $20,161, respectively) $ 9.95 $ Series E2: ($2,967 and $1,860, respectively) $ 9.95 $ Series E3: ($154 and $304, respectively) $ 9.96 $ Series E4: ($107 and $-, respectively) $ 9.81 $ Series P1: ($10,910 and $5,343, respectively) $ $ Series P2: ($4,720 and $1,647, respectively) $ $ Series P3: ($12 and $-, respectively) $ $ Annual Reportport 12

13 Statements of Comprehensive Income s in thousands of Canadian Dollars (except per security amounts) For the periods ended June 30, (Note 1) Investment income (Note 3) Interest $ 296,101 $ 280,675 Dividends 7,541 8,699 Net gain (loss) on investments Net realized gain (loss) on investments 73,126 73,896 Change in net unrealized appreciation (depreciation) on investments (285,116) 150,908 (211,990) 224,804 Total investment income (loss) 91, ,178 Operating expenses (Note 4) Management and advisory fees 4,281 4,410 Administration fees Independent Review Committee fees 1 1 Commissions and other portfolio costs Foreign taxes withheld (Note 5) 9 Sales tax Total operating expenses 5,570 5,732 Expenses waived (Note 4) (134) (123) Net operating expenses 5,436 5,609 Net increase (decrease) in net assets attributable to securityholders from operations $ 86,216 $ 508,569 Increase (decrease) in net assets attributable to securityholders from operations per Series (Note 3) Series A $ (1,087) $ 3,846 Series B $ (1,282) $ 9,873 Series F $ (7) $ 2,104 Series O $ 88,636 $ 491,903 Series E1 $ (121) $ 566 Series E2 $ (2) $ 55 Series E3 $ $ 4 Series E4 $ $ Series P1 $ 6 $ 176 Series P2 $ 73 $ 42 Series P3 $ $ Increase (decrease) in net assets attributable to securityholders from operations per Series per security (Notes 3 and 6) Series A $ (.16) $.45 Series B $ (.08) $.55 Series F $ $.82 Series O $.12 $.75 Series E1 $ (.05) $.35 Series E2 $ $.36 Series E3 $ (.03) $.37 Series E4 $.01 $ Series P1 $.01 $.46 Series P2 $.24 $.43 Series P3 $.20 $ 13 Annual Report

14 Financial Statements continued Statements of Changes in Net Assets Attributable to Securityholders s in thousands of Canadian Dollars For the period ended June 30, 2017 (Note 1) Total Series A Series B Series F Series O Series E1 Net assets attributable to securityholders, beginning of period $ 10,529,736 $ 112,461 $ 258,175 $ 55,690 $ 10,074,095 $ 20,161 Increase (decrease) in net assets attributable to securityholders from operations 86,216 (1,087) (1,282) (7) 88,636 (121) Distributions to securityholders (Note 5) From net investment income (351,749) (1,619) (4,781) (1,455) (342,977) (551) From net realized gain (5,327) (33) (86) (24) (5,168) (10) Management fee reduction (17) (14) (3) (357,093) (1,652) (4,881) (1,482) (348,145) (561) Security transactions (Note 6) Proceeds from sale of securities 2,124,682 18,602 55,681 41,216 1,967,354 20,985 Reinvestment of distributions 355,708 1,500 4, , s paid upon redemption of securities (1,827,873) (45,997) (87,740) (39,253) (1,633,741) (10,093) 652,517 (25,895) (27,468) 2, ,759 11,415 Net assets attributable to securityholders, end of period $ 10,911,376 $ 83,827 $ 224,544 $ 56,896 $ 10,496,345 $ 30,894 For the period ended June 30, 2017 (Note 1) Series E2 Series E3 Series E4 Series P1 Series P2 Net assets attributable to securityholders, beginning of period $ 1,860 $ 304 $ $ 5,343 $ 1,647 Increase (decrease) in net assets attributable to securityholders from operations (2) 6 73 Distributions to securityholders (Note 5) From net investment income (47) (4) (2) (231) (82) From net realized gain (1) (4) (1) Management fee reduction (48) (4) (2) (235) (83) Security transactions (Note 6) Proceeds from sale of securities 1, ,584 7,155 Reinvestment of distributions s paid upon redemption of securities (761) (254) (12) (5,911) (4,111) 1,157 (146) 109 5,796 3,083 Net assets attributable to securityholders, end of period $ 2,967 $ 154 $ 107 $ 10,910 $ 4,720 For the period ended June 30, 2017 (Note 1) Series P3 Net assets attributable to securityholders, beginning of period $ Increase (decrease) in net assets attributable to securityholders from operations Distributions to securityholders (Note 5) From net investment income From net realized gain Management fee reduction Security transactions (Note 6) Proceeds from sale of securities 12 Reinvestment of distributions s paid upon redemption of securities 12 Net assets attributable to securityholders, end of period $ 12 Annual Reportport 14

15 Statements of Changes in Net Assets Attributable to Securityholders continued For the period ended June 30, 2016 (Note 1) Total Series A Series B Series F Series O Series E1 Net assets attributable to securityholders, beginning of period $ 9,773,316 $ 136,552 $ 271,268 $ 24,673 $ 9,340,823 $ Increase (decrease) in net assets attributable to securityholders from operations 508,569 3,846 9,873 2, , Distributions to securityholders (Note 5) From net investment income (324,132) (2,087) (5,315) (1,002) (315,492) (144) Management fee reduction (17) (2) (13) (2) (324,149) (2,089) (5,328) (1,004) (315,492) (144) Security transactions (Note 6) Proceeds from sale of securities 2,193,316 31,157 66,523 44,055 2,018,789 22,418 Reinvestment of distributions 323,071 1,888 4, , s paid upon redemption of securities (1,944,387) (58,893) (89,160) (14,639) (1,777,420) (2,819) 572,000 (25,848) (17,638) 29, ,861 19,739 Net assets attributable to securityholders, end of period $ 10,529,736 $ 112,461 $ 258,175 $ 55,690 $ 10,074,095 $ 20,161 For the period ended June 30, 2016 (Note 1) Series E2 Series E3 Series E4 Series P1 Series P2 Net assets attributable to securityholders, beginning of period $ $ $ $ $ Increase (decrease) in net assets attributable to securityholders from operations Distributions to securityholders (Note 5) From net investment income (14) (1) (61) (16) Management fee reduction (14) (1) (61) (16) Security transactions (Note 6) Proceeds from sale of securities 1, ,207 1,902 Reinvestment of distributions s paid upon redemption of securities (157) (3) (1,010) (286) 1, ,228 1,621 Net assets attributable to securityholders, end of period $ 1,860 $ 304 $ $ 5,343 $ 1, Annual Report

16 Financial Statements continued Statements of Cash Flows s in thousands of Canadian Dollars For the periods ended June 30, (Note 1) Cash flows from (used in) operating activities: Purchases of investments $ (7,132,259) $ (4,703,468) Proceeds from sale and maturity of investments 6,530,066 4,117,950 Cash receipts from dividend income 7,541 8,699 Cash receipts from interest income 341, ,391 Cash paid for operating expenses (5,461) (5,563) Net cash from (used in) operating activities (258,520) (264,991) Cash flows from (used in) financing activities: Distributions to securityholders net of reinvestments (1,384) (1,032) Proceeds from sales of securities 2,045,608 2,191,180 s paid upon redemption of securities (1,789,123) (1,919,567) Net cash from (used in) financing activities 255, ,581 Net change in cash (3,419) 5,590 Cash, beginning of period 6, Cash, end of period $ 2,583 $ 6,002 Annual Reportport 16

17 Notes to Financial Statements For the periods ended June 30, 2017 and 2016 (s in thousands of Canadian dollars/thousands of securities (except per security amounts)) 1. Formation of the Fund Fidelity Canadian Bond Fund (Fund) is an open end mutual fund trust formed under the laws of Ontario and governed by a Master Declaration of Trust dated February 1, 1988 (Inception Date), as amended thereafter from time to time. The Fund is authorized to issue an unlimited number of securities. Fidelity Investments Canada ULC (Fidelity), as manager and trustee of the Fund, is responsible for the day-to-day operations and provides all general management and administrative services. The investment advisor is responsible for the investment management of the Fund s portfolio. On December 31, 2015, the investment advisor changed from FIAM LLC (formerly Pyramis Global Advisors, LLC) to Fidelity. The registered office of the Fund is located at 483 Bay Street, Suite 300, Toronto, Ontario, M5G 2N7. Currently, Fidelity mutual funds are offered in the following Series: Series A, Series C, Series T5 and Series T8 securities are available to all investors in a deferred sales charge (DSC) option. Series A, Series T5 and Series T8 securities will be converted to lower management and advisory fee Series B, Series S5 and Series S8 securities, respectively, one year after completion of their redemption schedule. Series B, Series D, Series S5 and Series S8 securities are available to all investors in an initial sales charge (ISC) option. Series C and Series D securities are available to investors who have enrolled in the rebalancing service. Series F, Series F5 and Series F8 securities are usually only available to investors who have fee based accounts with dealers who have signed an eligibility agreement with Fidelity. Series E1, Series E1T5, Series E2, Series E2T5, Series E3, Series E3T5, Series E4, Series E4T5, Series E5 and Series E5T5 securities are available only to investors who initially hold Series B and/or Series S5 securities and then become eligible to hold certain Series E securities. Series P1, Series P1T5, Series P2, Series P2T5, Series P3, Series P3T5, Series P4, Series P4T5, Series P5 and Series P5T5 securities are available only to investors who initially hold Series F and/or Series F5 securities and then become eligible to hold certain Series P securities. Series O securities are only available to selected investors who have been approved by Fidelity and have entered into a Series O Account Agreement with Fidelity. Series I, Series I5 and Series I8 securities are available to all investors who have entered into a Series I Agreement with Fidelity and are available to all investors in an initial sales charge (ISC) option. In addition, Series F5, Series F8, Series I5, Series I8, Series T5, Series T8, Series S5, Series S8, Series E1T5, Series E2T5, Series E3T5, Series E4T5, Series E5T5, Series P1T5, Series P2T5, Series P3T5, Series P4T5 and Series P5T5 securities distribute an amount comprised of net income and/or return of capital monthly, if available. The Fund commenced the offering of Series E1, Series E2 and Series E3 securities on February 5, 2016, commenced the offering of Series P1 and Series P2 securities on December 4, 2015, commenced the offering of Series E4 securities on September 16, 2016 and commenced the offering of Series P3 securities on January 26, The Fund meets the definition of an investment entity and its purpose is to provide investment management services to its securityholders by investing its net assets for capital growth and/or investment income and by measuring its investment performance on a fair value basis. Refer to the Financial Instruments Risk note below for the Fund s investment objective. 2. Basis of Preparation Statement of Compliance These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as published by the International Accounting Standards Board (IASB). The accounting policies set out below have been applied consistently unless otherwise stated. The financial statements were authorized for issue by Fidelity s board of directors on September 7, Functional and Presentation Currency These financial statements are presented in Canadian dollars, which is the Fund s functional currency. Comparative Figures - Per security comparative figures have been conformed to the current rounding presentation of two decimal places. 3. Summary of Significant Accounting Policies Basis of Measurement These financial statements have been prepared on the historical cost basis except for investments which are measured at fair value in the Statements of Financial Position. Use of Estimates and Judgments Under IFRS, management is required to make certain estimates and judgments at the date of the financial statements. The principal financial statement components subject to significant accounting estimates and judgments include: Fair value measurements The Fund may invest in financial instruments that are not quoted in an active market. Where applicable, these instruments are categorized in Level 2 and Level 3 of the fair value hierarchy explained below. When current market prices or quotations are not readily available or reliable, valuation techniques will be applied in good faith and in accordance with procedures adopted by the manager. Factors used in determining fair value may include, but are not limited to, broker quotes from reputable pricing sources, market or security specific events, changes in interest rates and credit quality. Fair value models use observable data, to the extent practical; however, the manager is required from time to time to make estimates and assumptions that are based on the best information available at that particular time. Changes in these estimates could impact the fair values of the financial instruments, and the impact could be material. The aggregate fair value of investments measured by valuation techniques as at June 30, 2017 and June 30, 2016, is included at the end of the Fund s Schedule of Investments. 17 Annual Report

18 Notes to Financial Statements continued (s in thousands of Canadian dollars/thousands of securities (except per security amounts)) Classification and measurement of financial instruments The Fund has made significant judgments when determining the classification and measurement of its financial instruments under IAS 39, Financial Instruments Recognition and Measurement (IAS 39). These judgments centre upon the determination that certain investments are held-for-trading and that the fair value measurement option can be applied to those that are not due to factors including performance evaluation and management of the Fund on a fair value basis. Presentation of financial instruments The Fund has made significant judgments when determining the classification of its redeemable securities as financial liabilities in accordance with IAS 32 Financial Instruments Presentation (IAS 32). These judgments centre upon the determination that the Fund s redeemable securities do not have identical features and their entitlements include a contractual obligation to distribute any net income and net realized capital gains at least annually in cash (at the request of the securityholder). Therefore, the ongoing redemption feature is not the securities only contractual obligation. Investment Valuation Investments are designated at their fair value through profit or loss in accordance with IAS 39 and are carried at their fair value. The Fund categorizes the inputs to valuation techniques used to fair value its investments into a disclosure hierarchy consisting of three levels as shown below: Level 1 quoted prices in active markets for identical investments Level 2 other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.) Level 3 unobservable inputs (including the Fund s own assumptions based on the best information available) Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. There were no significant transfers between Level 1 and Level 2 during the periods. The aggregate value of investments by input level, as at June 30, 2017 and June 30, 2016, as well as a roll forward of Level 3 securities, where applicable, is included at the end of the Fund s Schedule of Investments. The Fund did not hold any significant positions of Level 3 investments at the beginning of or end of the period. Valuation techniques used to value the Fund s investments by major category are as follows: Debt securities, including restricted debt securities, are valued based on prices received from independent pricing services or from dealers who make markets in such securities. Pricing services utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type, prepayment speed assumptions, attributes of the collateral as well as dealer supplied prices and are generally categorized as Level 2 in the hierarchy, but may be categorized as Level 3. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing matrices which consider similar factors that would be used by independent pricing services. These are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances. Independent prices obtained from a single source or broker are evaluated by management and may be categorized as Level 3 in the hierarchy. Short-term securities for which quotations are not readily available are valued at amortized cost, which approximates fair value and are categorized as Level 2 in the hierarchy. Cash Cash is comprised of cash on deposit and may include cash equivalents which are short-term debt instruments with terms to maturity of less than 90 days at acquisition which are held for the purpose of meeting short-term cash commitments. Foreign currencies are comprised of cash amounts denominated in currencies other than Canadian dollars, which are on deposit with the custodian to facilitate the settlement of foreign denominated security transactions. Cash is carried at amortized cost which approximates its fair value. The Fund did not hold any cash equivalents as at June 30, 2017 and June 30, Impairment of Financial Assets At each reporting date, the Fund assesses whether there is objective evidence that a financial asset carried at amortized cost is impaired. If such impairment exists, the Fund recognizes the difference between the amortized cost of the financial assets and the present value of the estimated future cash flows, discounted using the instrument s original effective interest rate as an impairment loss on the Statements of Comprehensive Income. Such impairment losses are reversed in subsequent periods in the Statements of Comprehensive Income if the conditions that lead to the initial recognition of the loss diminish or cease to exist. Other Assets and Liabilities Other assets and liabilities may include amounts due to or from the custodian, affiliates or other counterparties for accrued income, investment transactions, Fund s security transactions, accrued expenses and other unsettled transactions at period end. These amounts are classified as loans and receivables or financial liabilities and are carried at amortized cost, which approximates fair value due to their short-term nature. Classification of redeemable securities issued by the Fund In accordance with IAS 32, the Fund s redeemable securities entitlements include a contractual obligation to distribute any net income and net realized capital gains at least annually in cash (at the request of the securityholder) and, therefore, the ongoing redemption feature is not the securities only contractual obligation. In addition, each series of redeemable securities are equally subordinated to each other, but have differing features as outlined in the notes below. Therefore, the Fund s redeemable securities do not meet the criteria for classification as equity and have been classified as financial liabilities on the Statements of Financial Annual Reportport 18

19 Position. The Fund s obligation for net assets attributable to securityholders is recorded at the redemption amount. As at June 30, 2017 and June 30, 2016, the Fund s net asset value per Series per security may differ by less than $0.01 from its net assets attributable to securityholders per Series per securities calculated in accordance with IFRS as a result of normal reporting period end procedures to close off the books and records. Investment Transactions, Income Recognition and Transaction s - Regular way purchases and sales of financial assets are recognized at their trade date. The cost of investments is determined on an average cost basis, excluding commissions and other portfolio transaction costs. Net realized gains and losses from the sale of investments (which may include proceeds received from litigation) and change in net unrealized appreciation (depreciation) on investments are calculated with reference to average cost of the related investment securities. Interest income is accrued as earned and includes coupon interest and accretion of discount and amortization of premium on debt securities using the effective interest rate. This is the rate that exactly discounts the estimated future cash receipts through the expected life of the relevant debt securities, to their net carrying amounts. The principal value on inflation-indexed securities is periodically adjusted to the rate of inflation and interest is accrued based on the principal value. The adjustments to principal due to inflation are reflected as increases or decreases to interest income even though the principal is not received until maturity. Dividend income is recognized on the ex-dividend date except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Distributions received from investment trusts are recorded as income, capital gains or a return of capital based on the best information available. Due to the nature of these investments, actual allocations could vary from this information. Distributions from investment trusts treated as a return of capital reduce the average cost of the underlying investment trust. Transaction costs, such as brokerage commissions, incurred in the purchase and sale of investment securities by the Fund are recognized as Commissions and other portfolio costs in the Statements of Comprehensive Income. Foreign Currency Translation Securities and other assets and liabilities denominated in a foreign currency are translated into Canadian dollars at the period-end exchange rates. Purchases and sales of securities, income and expenses denominated in foreign currencies are translated into Canadian dollars at the exchange rate on the date of the respective transaction. The effects of exchange rate fluctuations on investments are included in the Net realized gain (loss) and change in net unrealized appreciation (depreciation) on investments and exchange rate fluctuations on other foreign currency transactions are included in the Net realized gain (loss) on foreign currency transactions and Change in net unrealized appreciation (depreciation) on other net assets in foreign currencies in the Statements of Comprehensive Income. Reverse Repurchase Agreements Uninvested cash balances may be transferred into one or more joint trading accounts where these balances are invested in reverse repurchase transactions. In reverse repurchase transactions, U.S. or Canadian Government securities are purchased from a counterparty who agrees to repurchase the securities at a higher price at a specified future date. The difference in price is reported as interest income. Credit risk arises from the potential for a counterparty to default on its obligation to repurchase the security. The risk is managed by the use of counterparties acceptable to Fidelity and by the receipt of the securities as collateral. The value of the collateral must be at least 102% of the daily fair value of the cash invested. Any reverse repurchase agreements open at period end are included in the Schedule of Investments. The following tables summarize the securities pledged to the Fund as collateral: June 30, 2017 Collateral Description Interest Rate (%) Maturity Date % of Collateral Collateral Value as a % of CAD Cash Invested Canada Housing Trust /15/ Canadian Treasury Bonds /1/ /1/ Canadian Treasury Bill n/a 3/8/2018 4/5/ June 30, 2016 Collateral Description Interest Rate (%) Maturity Date % of Collateral Collateral Value as a % of CAD Cash Invested Canadian Treasury Bonds /1/ /1/ Canadian Treasury Bill n/a 12/29/ Valuation of Series Separate net assets attributable to securityholders is calculated for each Series of securities of the Fund. The net assets attributable to securityholders of a Series is computed by calculating the Series proportionate share of the assets and liabilities of the Fund common to all Series, adjusted for the assets and liabilities of the Fund attributable only to that Series. Expenses directly attributable to a Series are charged to that Series. Investment income and operating expenses are allocated proportionately to each Series based upon the relative net assets attributable to securityholders of each Series, except for items that can be specifically attributed to one or more Series. Per Security from Operations - The increase (decrease) in net assets attributable to securityholders resulting from operations per security in the Statements of Comprehensive Income represent the operational increase (decrease) for each Series of the Fund, divided by the relevant 19 Annual Report

20 Notes to Financial Statements continued (s in thousands of Canadian dollars/thousands of securities (except per security amounts)) weighted average securities outstanding during the period. Refer to the Security Transactions Note for the Fund s weighted average securities outstanding. Statements of Cash Flows When preparing the Statements of Cash Flows, the Fund nets the rollover activity of its short-term investments, and includes only the net cash flow impact in Purchases of investments or Proceeds from sale and maturity of investments, as applicable. Additionally, in accordance with IFRS, the Fund s Statements of Cash Flows excludes non-cash transactions from its operating and financing activities. Recent Accounting Pronouncements The final version of IFRS 9, Financial Instruments, was issued by the IASB 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 an entity s 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 recognised 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 entity s own credit risk 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 does not plan to adopt the new standard early. 4. Expenses and Other Related Party Transactions Management and Advisory Fees - Fidelity serves as the manager and investment advisor of the Fund. Fidelity is part of a broader group of companies collectively known as Fidelity Investments. Fidelity has entered into sub-advisory agreements with a number of entities including Fidelity Investments Money Management, Inc., to provide investment advice with respect to all or a portion of the investments of the Fund. The sub-advisors arrange for acquisition and disposition of portfolio investments, including all necessary brokerage arrangements. The Fund pays Fidelity a monthly management and advisory fee for their services and the provision of key management personnel to the Fund, based on the net asset value of each Series, calculated daily and payable monthly. Fidelity may reduce the management and advisory fee or fund expenses for certain investors by reducing the management and advisory fee it charges to the Fund or reducing the amount charged to the Fund for certain expenses and having the Fund pay out the amount of the reduction to the investors as a distribution. These distributions are disclosed as Management fee reduction in the Statements of Changes in Net Assets Attributable to Securityholders. No management and advisory fees are charged with respect to the Series O securities, but investors will be charged a negotiated management fee. The annual management and advisory fee rates for each Series were as follows: Annual Management and Advisory Fee Rate (%) Series A Series B Series F Series E Series E Series E Series E Series P Series P Series P Administration Fee Fidelity charges the Fund a fixed administration fee in place of certain variable and administrative expenses, including the provision of key administrative personnel to the Fund. Fidelity, in turn, pays all of the operating expenses of the Fund, other than certain specified fund costs, including the fees and expenses of the Independent Review Committee, taxes, brokerage commissions and interest charges. The administration fee is in addition to the management and advisory fee. No administration fees are charged with respect to the Series O securities. The annual rate of the administration fee will fall under one of three tiers, depending on the net asset value of the Fund: Under $100 Million (Tier 1), $100 Million to $1 Billion (Tier 2) and Over $1 Billion (Tier 3). The administration fee is calculated as a fixed annual percentage, accrued daily and payable monthly, of the net asset value of each Series as follows: Annual Reportport 20

21 Tier 1 (%) Tier 2 (%) Tier 3 (%) Series A Series B Series F Series E Series E Series E Series E Series P Series P Series P Prior to October 28, 2016, the administration fee was calculated as a fixed annual percentage of the net asset value of each Series as follows (some or all Series administration fees may not have changed): Tier 1 (%) Tier 2 (%) Tier 3 (%) Series A Series B Series F Series E Series E Series E Series P Series P Prior to October 29, 2015, the administration fee was calculated as a fixed annual percentage of the net asset value of each Series as follows (some or all Series administration fees may not have changed): Tier 1 (%) Tier 2 (%) Tier 3 (%) Series A Series B Series F Independent Review Committee Fees - The Independent Review Committee (IRC), as required under National Instrument , reviews conflict of interest matters referred to it by the manager and provides recommendations or approves actions, as appropriate, that are in the best interest of the funds. There are currently four members of the IRC who are independent of Fidelity and its affiliates. IRC members are compensated by way of an annual retainer fee and a per meeting attendance fee, as well as reimbursed for expenses associated with IRC duties. These costs are allocated among the individual funds proportionately by assets. No IRC fees are charged with respect to the Series O securities. Sales Tax - Certain provinces have harmonized their Provincial Sales Tax (PST) with the federal Goods and Services Tax (GST). The Harmonized Sales Tax (HST) combines the GST rate of 5% with the PST rate of certain provinces. The Provincial GST/HST liability or refund is calculated using the residency of securityholders and the value of their interests in the Fund as at specific times, rather than the physical location of the Fund. The effective GST/HST rate charged to each Series of the Fund is based on the securityholders proportionate investments by province, using each province s HST rate or GST rate in the case of non-participating provinces. All amounts are included in the Statements of Comprehensive Income as Sales tax. Expenses Waived - Fidelity may absorb or waive certain expenses at its sole discretion and can terminate the absorption or waiver at any time. Fidelity waived a portion of its administration fee which is disclosed as Expenses waived in the Statements of Comprehensive Income. 5. Taxation and Distributions The Fund qualifies as a mutual fund trust under the provisions of the Income Tax Act (Canada). For tax purposes, the Fund has a December year end. In each tax year, the Fund declares and credits as due and payable sufficient net investment income and net realized capital gains to securityholders such that the Fund will not be subject to income taxes. As a result, the Fund does not record income taxes under IAS 12 Income Taxes (IAS 12) and accordingly does not recognize the deferred tax benefit associated with tax loss carry forwards and other taxable temporary differences. Foreign withholding taxes are imposed by certain countries on investment income and are estimated based on the tax rules and actual rates that exist in the foreign markets. Investment income is recorded gross of foreign taxes withheld. Foreign withholding taxes are accrued 21 Annual Report

22 Notes to Financial Statements continued (s in thousands of Canadian dollars/thousands of securities (except per security amounts)) for in conjunction with the accrual for the related investment income and are included in Foreign taxes withheld on the Statements of Comprehensive Income and Other payables and accrued expenses on the Statements of Financial Position Distributions are taxable in securityholders hands. At the end of each tax year, the character of the distributions is determined for tax purposes. Under the terms of the Declaration of Trust, the trustee may capitalize any distribution amount without any increase in the number of securities outstanding. Distributions, if any, are declared separately for each Series. Capital losses may be carried forward indefinitely to reduce future realized capital gains. As at the last taxation year-end, the Fund had no capital losses available to be carried forward. Non capital losses may be carried forward for up to 20 tax years to reduce future taxable income, but expire in December of the year noted. As at the last taxation year-end, the Fund had no non capital losses available to be carried forward. 6. Capital Risk Management Securities issued and outstanding are considered to be the capital of the Fund. The capital of each series of the Fund is divided into an unlimited number of securities of equal value, with no par value. All securities in a series of the Fund rank equally with respect to distributions. A securityholder of the Fund is entitled to one vote for each one dollar in value of securities owned. Fractional securities are proportionately entitled to these rights. The Fund generally has no restrictions or specific capital requirements on the subscriptions and redemptions of securities other than minimum subscription requirements; although, on rare occasions, Fidelity may temporarily suspend securityholders right to redeem securities and postpone paying sale proceeds. The relevant movements attributable to securityholders are shown in the Statements of Changes in Net Assets Attributable to Securityholders. In accordance with the objectives and the risk management policies outlined in the Financial Instruments Risk notes, the Fund endeavors to invest the subscriptions received in appropriate investments while maintaining sufficient liquidity to meet redemptions. Such liquidity is managed by investing the majority of assets in investments that can be readily disposed and via the Fund s ability to borrow up to 5% of its net asset value. Security Transactions - Security transactions and weighted average securities for each Series were as follows: Securities Outstanding, Beginning of Period Issued Reinvested Redeemed Securities Outstanding, End of Period Weighted Average Securities Period ended June 30, 2017 Series A 7,598 1, (3,170) 5,804 6,771 Series B 17,455 3, (6,037) 15,557 16,673 Series F 3,768 2, (2,709) 3,945 3,869 Series O 681, ,703 23,977 (112,547) 727, ,740 Series E1 1,976 2, (1,011) 3,103 2,679 Series E (76) Series E (25) Series E4 12 (1) Series P , (584) 1, Series P (401) Series P Period ended June 30, 2016 Series A 9,394 2, (4,070) 7,598 8,484 Series B 18,674 4, (6,156) 17,455 18,060 Series F 1,700 3, (1,011) 3,768 2,562 Series O 643, ,126 21,793 (122,768) 681, ,380 Series E1 2, (281) 1,976 1,631 Series E (15) Series E Series P (99) Series P (28) Affiliated Ownership - As at June 30, 2017, Fidelity and its affiliates held approximately 92% of the Fund. As at June 30, 2016, Fidelity and its affiliates held approximately 91% of the Fund. 7. Financial Instruments Risk The Fund s activities expose it to a variety of financial instruments risks: credit risk, liquidity risk, other price risk, interest rate risk and currency risk. Fidelity seeks to minimize potential adverse effects of these performance risks by employing professional, experienced portfolio advisors, by Annual Reportport 22

23 daily monitoring of positions and market events, and by diversifying the investment portfolio within the constraints of the investment mandate. Derivative financial instruments may be used to moderate certain risk exposures. Risk, as defined by Fidelity, is the mismatch of certain risk factors, such as the market capitalization, beta, common factors such as size, priceearnings ratio, price-to-book ratio and industry exposures, between a portfolio and its benchmark. Such mismatches may result in divergence of returns relative to the benchmark. Beta is a measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole. A beta of 1 indicates that the security s price will move with the market. A beta of less than 1 means that the security will be less volatile than the market. A beta of greater than 1 indicates that the security s price will be more volatile than the market. For example, if a stock s beta is 1.2, it s theoretically 20% more volatile than the market. Fidelity s objective is to provide consistent value-added return over the benchmark. Unsystematic risk is mitigated primarily through investments in a diverse portfolio of securities across many sectors, styles or regions of the market. Fidelity s qualitative fundamental security selection is also well diversified across many analysts. Rather than relying on a single valuation process or quantitative model that implicitly assumes that past value-added returns of some sectors or styles will persist into the future, Fidelity s analysts select securities based on their own unique valuation processes. The Fund aims to provide a steady flow of income. It invests primarily in Canadian fixed-income securities. The Fund s benchmark is the FTSE TMX Canada Universe Bond Index. Portfolio risk is monitored daily and reviewed monthly by an investment compliance group. In addition, there is a formal quarterly review of each fund. The investment compliance group, portfolio managers and the senior analysts attend a quarterly portfolio review. Portfolios within each strategy are reviewed relative to each other and to their benchmark. Active industry and security allocations are analyzed. Credit Risk - Credit risk is the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with the Fund. The Fund s own credit risk in the case of financial liabilities and a counterparty s credit risk, both indirect and direct, are considered, where applicable, in determining the fair value of financial assets and financial liabilities. In addition, as part of its cash management, the Fund limits its direct exposure to credit loss by placing its cash with high credit quality financial institutions. The carrying amount of investments and other assets represents the maximum credit risk exposure as at June 30, 2017 and June 30, Credit risk arising on Canadian debt securities held directly or indirectly, as applicable, is mitigated by investing primarily in rated instruments or instruments issued by rated counterparties with credit ratings of at least BB or better as determined by Moody s Investor Services, Inc. or S&P at the date of purchase. Refer to the Quality Diversification tables in the Summary of Investment Portfolio of the Fund s Annual Management Report of Fund Performance as at June 30, 2017, which summarize the credit risk that is relevant for the Fund. Collateralized reverse repurchase agreements may result in credit exposure in the event that the counterparty to the transaction is unable to fulfill its contractual obligations. The risk is managed by the receipt of the underlying securities as collateral and use of counterparties whose credit worthiness is considered sufficient based on Fidelity s independent review. Other than outlined above, there were no significant concentrations of credit risk to counterparties as at June 30, 2017 and June 30, Concentration Risk - The Fund may be exposed to risk based on the concentration levels of its financial instruments in various sectors, geographic regions, asset weightings and market capitalization, as applicable. Fidelity analyzes and monitors these concentration risks regularly. Refer to the Sector Mix tables in the Summary of Investment Portfolio of the Fund s Annual Management Report of Fund Performance as at June 30, 2017, which summarize the investment concentration risks that are relevant for the Fund. Liquidity Risk - Liquidity risk is defined as the risk that the Fund may not be able to settle or meet its obligations on time or at a reasonable price. The Fund is exposed to daily cash redemptions of its redeemable securities. Redeemable securities are redeemed on demand at the securityholder s option based on the Fund s net asset value per security (NAVPS) at the time of redemption. The Fund may be exposed to indirect liquidity risk through its investments. In accordance with securities regulations, investment funds must maintain at least 90% of assets in liquid investments; investments that are traded in an active market and can be readily disposed of. In addition, the Fund aims to retain sufficient cash and short-term investments to maintain liquidity, and has the ability to borrow up to 5% of its net asset value from the custodian for the purpose of funding redemptions. The liquidity position is monitored on a daily basis. As at June 30, 2017 and June 30, 2016, the Fund did not have financial liabilities with maturities greater than 3 months. 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 on monetary instruments), whether caused by factors specific to an individual investment, its issuer, or other factors affecting all instruments traded in a market or market segment. All financial instruments present a risk of loss of capital. This risk is moderated through a careful selection of securities and other financial instruments within the parameters of the investment strategy. The maximum risk resulting from financial instruments is equivalent to their fair value. Investments, if applicable, are susceptible to other price risk arising from uncertainties about future prices of the instruments. 23 Annual Report

24 Notes to Financial Statements continued (s in thousands of Canadian dollars/thousands of securities (except per security amounts)) If the benchmark had increased or decreased by 5% on June 30, 2017 and June 30, 2016, with all other variables held constant, the net assets attributable to securityholders of the Fund would have increased or decreased by approximately $521,205 (June 30, 2016: $503,521). This change is estimated using the Fund s beta which is calculated based on the historical correlation between the return of the Fund as compared to the return of the benchmark. In practice, the actual trading results may differ from this sensitivity analysis and the difference could be material. Interest Rate Risk - Interest rate risk arises on interest-bearing financial instruments held directly or indirectly in the investment portfolio such as bonds. The Fund is exposed to the risk that the fair value or the future cash flows of interest-bearing financial instruments will fluctuate due to changes in the prevailing levels of market interest rates. Any excess cash may be invested in short-term investments at market interest rates. Refer to the Maturity Diversification tables in the Summary of Investment Portfolio of the Fund s Annual Management Report of Fund Performance as at June 30, 2017, which summarize the Fund s exposure to interest-bearing financial instruments at period end categorized by the earlier of contractual interest rate reset or maturity dates. The fixed income investment strategy adheres to independent quantitative understanding of all benchmark and portfolio risk and return characteristics with an explicit understanding of all active exposures relative to the investment benchmark. Interest rate anticipation is not a significant component of the fixed income investment strategy. As at June 30, 2017 and June 30, 2016, had prevailing interest rates raised or lowered by 25 basis points, with all other variables remaining constant, net assets attributable to securityholders would have decreased or increased by approximately $206,367 (June 30, 2016: $199,397). In practice, the actual trading results may differ from this sensitivity analysis and the difference could be material. Currency Risk - Currency risk arises from financial instruments that are denominated in a currency other than Canadian dollar, which is the Fund s functional currency. The Fund is exposed to the risk that the value of financial instruments will fluctuate due to changes in exchange rates. Currency risk is not considered to arise from financial instruments that are non-monetary items such as equity investments, or forward foreign exchange contracts related to such non-monetary items. Foreign exchange exposure relating to non-monetary assets and liabilities is considered to be a component of other price risk, not foreign currency risk. As at June 30, 2017 and June 30, 2016, the majority of the Fund s monetary assets and liabilities are denominated in Canadian dollars. As a result, the Fund is not subject to significant amounts of risk due to fluctuations in exchange rates. Annual Reportport 24

25 Management Report and Independent Auditor s Report Management Responsibility for Financial Reporting To the Securityholders and Trustee of Fidelity Canadian Bond Fund (Fund) The accompanying financial statements have been prepared by Fidelity Investments Canada ULC (Fidelity), as manager of the Fund. Fidelity is responsible for the information and representations contained in these financial statements. The Board of Directors of Fidelity is responsible for reviewing and approving the financial statements. Fidelity maintains appropriate processes to ensure that relevant and reliable financial information is produced. The financial statements have been prepared in accordance with International Financial Reporting Standards and include certain amounts and disclosures that are based on estimates and judgments. The significant accounting policies, which management believes are appropriate for the Fund, are described in Note 3 to the financial statements. PricewaterhouseCoopers LLP is the external auditor of the Fund. They have audited the financial statements in accordance with Canadian generally accepted auditing standards to enable them to express to the securityholders their opinion on the financial statements. Their report is set out below. Brock Dunlop Vice President and Fund Treasurer Fidelity Investments Canada ULC September 7, 2017 Independent Auditor s Report To the Securityholders and Trustee of Fidelity Canadian Bond Fund (Fund) We have audited the accompanying financial statements of the Fund, which comprise the statements of financial position as at June 30, 2017 and 2016 and the statements of comprehensive income, changes in net assets attributable to securityholders and cash flows for the years ended June 30, 2017 and 2016, and the related notes, which comprise 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 the 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 the 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 audits 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 the Fund as at June 30, 2017 and 2016 and its financial performance and its cash flows for the years ended June 30, 2017 and 2016 in accordance with International Financial Reporting Standards. PricewaterhouseCoopers LLP Chartered Professional Accountants, Licensed Public Accountants Toronto, Ontario September 7, Annual Report

26 Annual Reportport 26

27 27 Annual Report

28 Fidelity Investments Canada ULC 483 Bay Street, Suite 300 Toronto, Ontario M5G 2N7 Manager, Transfer Agent and Registrar Fidelity Investments Canada ULC 483 Bay Street, Suite 300 Toronto, Ontario M5G 2N7 Portfolio Adviser Fidelity Investments Canada ULC Toronto, Ontario Custodian State Street Trust Company of Canada Toronto, Ontario Auditor PricewaterhouseCoopers LLP Toronto, Ontario Visit us online at or call Fidelity Client Services at Fidelity s mutual funds are sold by registered Investment Professionals. Each Fund has a simplified prospectus, which contains important information on the Fund, including its investment objective, purchase options, and applicable charges. Please obtain a copy of the prospectus, read it carefully, and consult your Investment Professional before investing. As with any investment, there are risks to investing in mutual funds. There is no assurance that any Fund will achieve its investment objective, and its net asset value, yield, and investment return will fluctuate from time to time with market conditions. Investors may experience a gain or loss when they sell their securities in any Fidelity Fund. Fidelity Global Funds may be more volatile than other Fidelity Funds as they concentrate investments in one sector and in fewer issuers; no single Fund is intended to be a complete diversified investment program. Past performance is no assurance or indicator of future returns. There is no assurance that either Fidelity Canadian Money Market Fund or Fidelity U.S. Money Market Fund will be able to maintain its net asset value at a constant amount. The breakdown of Fund investments is presented to illustrate the way in which a Fund may invest, and may not be representative of a Fund s current or future investments. A Fund s investments may change at any time. Fidelity Investments is a registered trademark of Fidelity Investments Canada ULC E FICL-CBON-ANN-0917