Macquarie Clean Technology Fund Annual report - 30 June 2008

Transcription

1 Annual report -

2 Annual report - Contents Income statement Balance sheet Statement of changes in equity Cash flow statement Trustee's declaration Independent auditor's report to the unitholders of Macquarie Clean Technology Fund Page This financial report covers Macquarie Clean Technology Fund as an individual entity. The Trustee of Macquarie Clean Technology Fund is Macquarie Investment Management Limited (ABN ). The Trustee's registered offce is Level 7, 1 Martin Place, Sydney, NSW

3 Income statement For the year ended Income statement Notes 30 June 2008 For Period 17 Nov 2006 to 30 Jun 2007 Investment income Interest income from financial assets not held at fair value through profit or loss Net gains/(iosses) on financial instruments held at fair value through profit or loss Total net investment income/(ioss) 4 5,802 5, (464) (435) Expenses Trustee's fees Total operating expenses Operating profit/(ioss) 1,464 1,464 4, (687) Finance costs attributable to unitholders (Increase)/decrease in net assets attributable to unitholders - arising from operations - arising from difference in valuation used in unit pricing compared to financial statements Profit/(Ioss) for the year (4,443) The above income statement should be read in conjunction with the accompanying notes. -2-

4 Balance sheet As at Balance sheet 30 June 30 June Notes Assets Cash and cash equivalents Receivables Financial assets held at fair value through profi or loss Total assets Liabilties Trustee fees payable Total liabilties (excluding net assets attributable to unitholders) Net assets attributable to unitholders - liability 6 2, , , ,319 10,699 Represented by: Fair value of outstanding units based on redemption value Difference in valuation used in unit pricing compared to financial statements 5 31, ,319 10,699 10,699 The above balance sheet should be read in conjunction with the accompanying notes. -3-

5 Statement of changes in equity For the year ended Statement of changes in equity Total equity at the beginning of the financial year Profitl(loss) for the year Total recognised income and expense for the financial year Transactions with equity holders in their capacity as equity holders Distributions to equity holders Total equity at the end of the financial year 30 June 2008 For Period 17 Nov 2006 to 30 Jun 2007 Under AI FRS, net assets attributable to unitholders are classified as a liabilty rather than equity. As a result there was no equity at the start or end of the year. The above statement of changes in equity should be read in conjunction with the accompanying notes. -4-

6 Cash flow statement For the year ended Cash flow statement Notes 30 June 2008 For Period 17 Nov 2006 to 30 Jun 2007 Cash flows from operating activities Proceeds from sale of financial instruments held at fair value through 1,180 profit or loss Purchase of financial instruments held at fair value through profi or loss Return of capital received (16,138) 1,255 (10,463) Interest received Responsible entity's fees received/(paid) (1,332) (150) Net cash inflow/(outflow) from operating activities 8(a) (14,972) (10,584) Cash flows from financing activities Proceeds from applications by unitholders 16,177 11,386 Net cash inflow/(outflow) from financing activities 16,177 11,386 Net increase/(decrease) in cash and cash equivalents 1, Cash and cash equivalents at the beginning of the year 802 Cash and cash equivalents at the end of the year 6 2, The above cash flow statement should be read in conjunction with the accompanying notes. -5-

7 1 General information This financial report covers Macquarie Clean Technology Fund ("the Trust") as an individual entity. The Trust was constituted on 17 November The Trustee of the Trust is Macquarie Investment Management Limited (the "Trustee"). The Trustee's registered offce is Level 7, 1 Martin Place, Sydney, NSW The financial report is presented in United States dollars. During the year, the Trust continued to invest funds in accordance with target asset allocations as set out in the current offer document and in accordance with the provisions of the Trust Deed. The financial statements were authorised for issue by the directors on 29 September The directors of the Trustee have the power to amend and reissue the financial report. 2 Summary of significant accounting policies The Trust is not a reporting entity because, in the Trustee's opinion, it is unlikely that users exist who are unable to command the preparation of reports tailored so as to satisfy, specifically, all of their information needs. This is a special purpose financial report that has been prepared for the sole purpose of fulfillng the Trustees' responsibilities to prepare and distribute a financial report to members and must not be used for any other purpose. The Trustee has agreed that the accounting policies adopted are appropriate to meet the needs of the unitholders. As the Trust is not a reporting entity it is not required to prepare financial reports in accordance with Accounting Standards and Urgent Issues Group Consensus Views. However, the financial report has been prepared in accordance with accounting policies as set out below. These policies have been consistently applied to all periods presented, unless otherwise stated in the following text. (a) Basis of preparation This special purpose financial report has been prepared in accordance with Australian equivalents to International Financial Reporting Standards (AIFRS), other authoritative pronouncements of the Australian Accounting Standards Board, Urgent Issues Group Interpretations and the Corporations Act 2001 in Australia except as follows:. * AASB 7 Financial Instruments: Disclosures * AASB 124 Related Party Disclosures * AASB 127 Consolidated and Separate Financial Statements * AASB 128 Investments in Associates and any other accounting standard by reasonable determination of the Trustee (except in respect of valuation methodology) or by the approval of the Advisory Committee. The financial report is prepared on the basis of fair value measurement of assets and liabilities except where otherwise stated. (b) Financial instruments (i) Classifcation The Trust's investments are categorised as at fair value through profi or loss. They comprise:. Financial instruments designated at fair value through profi or loss upon initial recognition These include financial assets that are not held for trading purposes and which may be sold. These are investments in limited partnerships. Financial assets and financial liabilities designated at fair value through profi or loss at inception are those that are managed and their performance evaluated on a fair value basis in accordance with the Trust's documented investment strategy. The Trust's policy is for the Trustee to evaluate the information about these financial assets on a fair value basis together with other related financial information. -6-

8 (continued) 2 Summary of significant accounting policies (continued) (b) Financial instruments (continued) Loans and receivables/payables comprise amounts due to or from the Trust. (ii) Recognition/derecognition The Trust recognises financial assets and financial liabilities on the date it becomes part to the contractual agreement (trade date) and recognises changes in fair value of the financial assets or financial liabilties from this date. Investments are derecognised when the right to receive cashflows from the investments has expired or the Trust has transferred substantially all risks and rewards of ownership. (iii) Measurement (a) Financial assets and liabilities held at fair value through profit or loss Financial assets and liabilities held at fair value through profit or loss are measured initially at fair value excluding any transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability. Transaction costs on financial assets and financial liabilities at fair value through profit or loss are expensed immediately. Subsequent to initial recognition, all instruments held at fair value through profi or loss are measured at fair value with changes in their fair value recognised in the income statement.. Fair value in an inactive or unquoted market Investments in limited partnerships are recorded at the redemption value per unit as reported by the managers of such partnerships. (b) Loans and receivables Loan assets are measured initially at fair value plus transaction costs and subsequently amortised using the effective interest rate method, less impairment losses if any. Such assets are reviewed at each balance sheet date to determine whether there is objective evidence of impairment for example when there has been a significant or prolonged decline in the fair value below carrying amount. If any such indication of impairment exists, an impairment loss is recognised in the income statement as the difference between the asset's carrying amount and the present value of the revised estimated future cash flows discounted at the original effective interest rate. If in a subsequent period the amount of an impairment loss recognised on a financial asset carried at amortised cost decreases and the decrease can be linked objectively to an event occurring after the write-down, the writedown is reversed through the income statement. (c) Net assets attributable to unitholders The Trust is a close-end fund and is not subject to daily applications and redemptions. The fair value of units is measured at the redemption amount that is payable (based on the redemption unit price) at the balance sheet date if unitholders were able to excercise their right to put the units back to the Trust. (d) Cash and cash equivalents For cash flow statement presentation purposes, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short term, high liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown separately on the balance sheet. Payments and receipts relating to the purchase and sale of investment securities are classified as cash flows from operating activities, as movements in the fair value of these securities represent the Trust's main income generating activity. -7-

9 (continued) 2 Summary of significant accounting policies (continued) (e) Investment income Trust distributions are recognised on an entitlements basis. (f) Income tax Under current legislation, the Trust is not subject to income tax provided the taxable income of the Trust is fully distributed either by way of cash or reinvestment (ie unitholders are presently entitled to the income of the Trust). Financial instruments held at fair value may include unrealised capital gains. Should such a gain be realised, that portion of the gain that is subject to capital gains tax wil be distributed so that the Trust is not subject to capital gains tax. Realised capital losses are not distributed to unitholders but are retained in the Trust to be offset against any realised capital gains. If realised capital gains exceed realised capital losses, the excess is distributed to. unitholders. The benefits of imputation credits and foreign tax paid are passed on to unitholders. (g) Distributions In accordance with the Trust Deed, the Trust distributes its distributable (taxable) income, and any other amounts determined by the Trustee, to unitholders by cash or reinvestment. The distributions are recognised in the income statement as finance costs attributable to unitholders. (h) Increaseldecrease in net assets attributable to unitholders Income not distributed is included in net assets attributable to unitholders. Movements in net assets attributable to unitholders are recognised in the income statement as finance costs. (i) Foreign currency translation i) Functional and presentation currency Items included in the Trust's financial statements are measured using the currency of the primary economic environment in which it operates (the "functional currency"). This is the United States dollar, which reflects the currency of the economy in which the Trust competes for funds and is regulated. The United States dollar is also the Trust's presentation currency. ii) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translations at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement. The Trust does not isolate that portion of gains or losses on securities and derivative financial instruments that are measured at fair value through profi or loss and which is due to changes in foreign exchange rates from that which is due to changes in the market price of securities. Such fluctuations are included with the net gains or losses on financial instruments at fair value through profi or loss. (j Accrued income Accrued income may include amounts for dividends, trust distributions and interest. Dividends and trust distributions are accrued when the right to receive payment is established. Interest is accrued at the reporting date from the time of last payment. Amounts are generally received within 30 days of being recorded as receivables. -8-

10 (continued) 2 Summary of significant accounting policies (continued) (k) Receivables Receivables may include amounts for dividends, interest and trust distributions. Dividends and trust distributions are accrued when the right to receive payment is established. Interest is accrued at the reporting date from the time of last payment in accordance with the policy set out in note 2(e) above. Amounts are generally received within 30 days of being recorded as receivables. Receivables include such items as RITC and application monies receivable from unitholders. (I) Payables Payables includes liabilities and accrued expenses owing by the Trust which are unpaid as at balance date. Trades are recorded on trade date, and normally settled within three business days. Purchases of financial instruments that are unsettled at reporting date are included in payables. The distribution amount payable to unitholders as at the reporting date is recognised separately on the balance sheet when unitholders are presently entitled to the distributable income under the Trust Deed. (m) Goods and Services Tax (GST) The GST incurred on the costs of various services provided to the Trust by third parties such as audit fees, custodial services and investment management fees have been passed onto the Trust. The Trust qualifies for Reduced Input Tax Credits (RITC) at a rate of 75% hence investment management fees, custodial fees and other expenses have been recognised in the income statement net of the amount of GST recoverable from the Australian Taxation Offce (ATO). Accounts payable are inclusive of GST. The net amount of GST recoverable from the ATO is included in receivables in the balance sheet. Cash flows relating to GST are included in the cash flow statement on a gross basis. (n) Use of estimates The Trust makes estimates and assumptions that affect the reported amounts of assets and liabilities within the next financial year. Estimates are continually evaluated and based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. (0) New accounting standards and interpretations Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2008 reporting periods. The directors' assessment of the impact of these new standards (to the extent relevant to the Trust) and interpretations is set out below: AASB 8 and AASB are effective for annual reporting periods beginning on or after 1 January The Trust has not adopted these standards early. Application of these standards wil not affect any of the amounts recognised in the financial statements, but may affect the segment disclosures provided in note 9. AASB 101 (Revised) is applicable to annual reporting period beginning on or after 1 January The Trust has not adopted this standard early. It requires the presentation of a statement of comprehensive income and makes changes to the statement of changes in equity but will not affect any of the amounts recognised in the financial statements. If the Trust makes a prior period adjustment or re-classifies items in the financial statement, it wil need to disclose a third balance sheet (statement of financial position), this one being at the beginning of the comparative period. Revised AASB 132 is applicable for reporting periods beginning on or after 1 January The Trust has not adopted this standard early. Application of this standard wil not affect any of the amounts recognised in the financial statements as the Trust is obligated to distribute all of its taxable income in accordance with the Trust Deed. Accordingly, there wil be no change to classification of unitholders' funds as a liability and therefore no impact on profi or loss and equity. -9-

11 (continued) 2 Summary of significant accounting policies (continued) (p) Rounding of amounts The Trust is an entity of the kind referred to in Class Order 98/0100 (as amended), issued by the Australian Securities and Investments Commission, relating to the "rounding off' of amounts in the financial report. Amounts in the financial report have been rounded off to the nearest thousand dollars in accordance with that Class Order, unless otherwise indicated. (q) Segment reporting A business segment is identified for a group of assets and operations engaged in providing products or services that are subject to risks and returns that are different to those of other business segments. A geographical segment is identified when products or services are provided within a particular economic environment subject to risks and returns that are different from those of segments operating in other economic environments. 3 Auditor's remuneration During the year the following fees were paid or payable for services provided by the auditor of the Trust: 30 June 2008 USD For Period 17 Nov 2006 to 30 Jun 2007 USD Audit services PricewaterhouseCoopers Australian firm Audit and review of financial reports Total remuneration for audit services 8,364 8,364 8,785 8,785 Audit fees are paid out of the Trustee's own resources. All other expenses are paid by the Trust. 4 Net gains/(iosses) on financial instruments held at fair value through profit or loss Net gains/(iosses) recognised in relation to financial assets and financial liabilties held at fair value through profi or loss: 30 June 2008 For Period 17 Nov 2006 to 30 Jun 2007 Net unrealised gain/(ioss) on financial instruments designated as at fair value through profit or loss Net realised gain/(loss) on financial instruments designated as at fair value through profi or loss Net gains/(iosses) on financial assets held at fair value through profit or loss 5, ,802 (464) (464) Realised and unrealised gains and losses are calculated on a weighted average cost basis -10-

12 (continued) 5 Net assets attributable to unitholders Movements in number of units and net assets attributable to unitholders during the year were as follows: As stipulated within the Trust Deed, each unit represents a right to an individual share in the Trust and does not extend to a right to the underlying assets of the Trust. There are no separate classes of units and each unit has the same rights attaching to it as all other units of the Trust. 30 June 30 June 30 June 30 June No. '000 No. '000 Opening balance 51,650 10,699 Applications 61,850 51,650 16,177 11,386 Increase/(decrease) in net assets attributable to unitholders 4,401 (687) Closing balance 113,500 51,650 31,277 10,699 6 Cash and cash equivalents 30 June 30 June Cash at bank 2, Financial assets held at fair value through profit or loss Designated at fair value through profit or loss Limited partnerships Total designated at fair value through profit or loss Total financial assets held at fair value through profi or loss 30 June 30 June Fair value Fair value 29,546 9,998 29,546 9,998 29,546 9, June 30 June Fair value Fair value Limited partnerships Units in International limited partnerships Total limited partnerships Total financial assets held at fair value through profi or loss 29,546 9,998 29,546 9,998 29,546 9,

13 (continued) 8 Reconciliation of profit/(ioss) to net cash inflow/(outflow) from operating activities 30 June 2008 For Period 17 Nov 2006 to 30 Jun 2007 (a) Reconcilation of profit/(ioss) to net cash inflow/(outflow) from operating activities Profit/loss for the year Increase/(decrease) in net assets attributable to unitholders Net (gains)/iosses on financial instruments held at fair value through profit or loss Proceeds from sale of financial instruments held at fair value through profi or loss Purchase of financial instruments held at fair value through profi or loss and derivative financial instruments Return of capital Net change in receivables and other assets Net change in payables and other liabilities Net cash inflow/(outflow) from operating activities 4,401 (687) (5,802) 464 1,180 (16,138) 1,255 (10,463) (13) 145 (18) 120 (14,972) (10,584) 9 Segment information While the Trust operates primarily in the business of investment management within the United states (the geographical segment), the Trust may have investment exposures in different countries and across different industries. Geographical exposure 30 June 2008 Percentage of Total assets total assets Total assets % 30 June 2007 Percentage of total assets % Country Europe United States Total 2,325 29,259 31, ,565 9,254 10, The above disclosures have been prepared on the basis of the Trust's direct investments and not on a look-through basis for investments held indirectly through unit trusts. The above investments are classified on the balance sheet at fair value through profi or loss. 10 Events occurring after the balance sheet date No significant events have occurred since balance date which would impact on the financial position of the Trust disclosed in the balance sheet as at or on the results and cash flows of the Trust for the year ended on that date. 11 Contingent assets and liabilities and commitments There are no outstanding contingent assets and liabilities as at and 30 June

14 (continued) 11 Contingent assets and liabilties and commitments (continued) Outstanding commitments in respect of partly paid units at totalled $ 87,592,656 (2007: $ 27,865,387). The investment commitments presented above represent commitments to purchase interests in assets at such time as the Manager of those assets request. The precise timing of future calls, and whether such calls wil be made at all, is at the discretion of the Investment Managers of each individual asset within the investment portolio. -13-

15 Trustee's declaration Trustee's declaration Macquarie Investment Management Limited, the Trustee of Macquarie Clean Technology Fund (the "Trust") declares, for the year ended, that: (a) the financial statements and notes set out on pages 2 to 13 are in accordance with the Trust Deed, including: (i) complying with Accounting Standards, and other mandatory professional reporting requirements, and (ii) giving a true and fair view of the Trust's financial position as at and of its performance, for the financial year ended on that date; and (b) in the Trustee's opinion, there are reasonable grounds to believe that the Trust will be able to pay its debts as and when they become due and payable. (( L-C R Cartright Director Sydney 29 September

16 PRcEWtRHOUsE(aJPERS I PricewaterhouseCoopers ABN Independent auditor's report to the unitholders of Macquarie Clean Technology Fund Darling Park Tower Sussex Street GPO BOX 2650 SYDNEY NSW 1171 DX 77 Sydney Australia Telephone Facsimile Report on the financial report We have audited the accompanying financial report, being a special purpose financial report, of Macquarie Clean Technology Fund (the Trust), which comprises the balance sheet as at 30 June 2008, the income statement, the statement of changes in equity, the cash flow statement and the notes to the financial statements for the year then ended, and the trustee's declaration. The responsibilty of the directors of the trustee for the financial report The directors of the trustee are responsible for the preparation and fair presentation of the financial report and have determined that the accounting policies described in Note 2 to the financial statements, which form part of the financial report, are appropriate to meet the requirements of the trust deed dated 17 November 2006 and are appropriate to meet the needs of the unitholders. The responsibility of the directors of the trustee also includes establishing and maintaining internal control relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditor's responsibilty Our responsibility is to express an opinion on the financial report based on our audit. No opinion is expressed as to whether the accounting policies used, as described in Note 2, are appropriate to meet the needs of the unitholders. We conducted our audit in accordance with Australian Auditing Standards. These Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Trust's preparation and fair presentation of the financial report 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 Trust's internal control. An audit also includes evaluating the reasonableness of accounting estimates made by the directors of the trustee, as well as evaluating the overall presentation of the financial report. The financial report has been prepared for distribution to unitholders for the purpose of fulfilling the financial reporting obligations of the directors of the trustee under the trust deed. We disclaim any assumption of responsibility for any reliance on this audit report or on the financial report to which it relates to any person other than the unitholders, or for any purpose other than that for which they were prepared. For further explanation of an audit, visit our website hup://ww.pwc.com/au/financialstatementaudit. Liability limited by a scheme approved under Professional Standards Legislation

17 fjcewtfrhouse(oopers I Independent auditor's report to the unitholders of Macquarie Clean Technology Fund (continued) Our audit did not involve an analysis of the prudence of business decisions made by directors or management. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Auditor's opinion In our opinion, the financial report presents fairly, in all material respects, the financial position of Macquarie Clean Technology Fund as of and its financial performance for the year then ended in accordance with the accounting policies described in Note 2 to the financial ~i,j~~ statements. ~ : Craig Stafford Partner I PricewaterhouseCoopers Sydney 29 September 2008