Al-Arabi Balanced Fund (Managed by Arab National Investment Company)

Transcription

1 (Managed by Arab National Investment Company) UNAUDITED INTERIM FINANCIAL STATEMENTS 30 JUNE

2

3 BALANCE SHEET As at 30 June 30 June 31 December (Audited) 30 June Note ASSETS Bank balance 3,010 5,174 26,286 Trading investments, net 4 4,340,536 4,438,628 4,788,335 4,343,546 4,443,802 4,814,621 LIABILITY Payables 3,628 3,546 3,426 UNITHOLDERS FUNDS Net assets 4,339,918 4,440,256 4,811,195 Units in issue 289, , ,388 Per unit value The accompanying notes 1 to 7 form an integral part of these interim financial statements. 2

4 STATEMENT OF OPERATIONS For the six month period ended 30 June (LOSS) INCOME Note Trading (loss) income, net 5 (47,893) 260,869 EXPENSES Management fees 6 - (13,982) Other fees 6 (6,719) (6,351) (6,719) (20,333) NET (LOSS) INCOME FROM OPERATIONS (54,612) 240,536 The accompanying notes 1 to 7 form an integral part of these interim financial statements. 3

5 STATEMENT OF CASH FLOWS For the six month period ended 30 June OPERATING ACTIVITIES Net (loss) income from operations (54,612) 240,536 Adjustment for: Movement in unrealised losses, net 57,438 16,462 2, ,998 Changes in operating assets and liabilities: Trading investments, net 40,654 (1,254,580) Payables 82 (17,148) Net cash from (used in) operating activities 43,562 (1,014,730) FINANCING ACTIVITIES Proceeds from units sold - 20,906 Value of units redeemed (45,726) - Net cash (used in) from financing activities (45,726) 20,906 DECREASE IN BANK BALANCE (2,164) (993,824) Bank balance at the beginning of the period 5,174 1,020,110 BANK BALANCE AT THE END OF THE PERIOD 3,010 26,286 The accompanying notes 1 to 7 form an integral part of these interim financial statements. 4

6 STATEMENT OF CHANGES IN NET ASSETS For the six month period ended 30 June NET ASSET VALUE AT THE BEGINNING OF THE PERIOD 4,440,256 4,549,753 Net (loss) income from operations (54,612) 240,536 CHANGES FROM UNITS TRANSACTIONS Proceeds from sale of units - 20,906 Value of units redeemed (45,726) - Net change from units transactions (45,726) 20,906 NET ASSET VALUE AT THE END OF THE PERIOD 4,339,918 4,811,195 UNITS TRANSACTIONS Transactions in units for the six month period ended 30 June are summarised as follows: Units Units UNITS AT THE BEGINNING OF THE PERIOD 293, ,080 Units sold - 1,308 Units redeemed (3,213) - Net (decrease) increase in units (3,213) 1,308 UNITS AT THE END OF THE PERIOD 289, ,388 The accompanying notes 1 to 7 form an integral part of these interim financial statements. 5

7 NOTES TO THE INTERIM FINANCIAL STATEMENTS 30 June 1 GENERAL Al-Arabi Balanced Fund ( the Fund ) is an open-ended fund. The objective of the Fund is to provide in the mid-term, the opportunity of capital growth and income while lowering the risk of significant capital loss. The Fund was established on 3 Rabi Awal 1422H (corresponding to 26 May 2001) by Arab National Bank ( the Bank ). In accordance with the Capital Market Authority s ( CMA ) decision No dated 21 Jumada Awal 1426H (corresponding to 28 June 2005) issued by the CMA Board in connection with regulations relating to Authorised Persons, the Bank transferred its asset management operations to the Arab National Investment Company ( the Fund Manager ), a wholly owned subsidiary of the Bank, effective 1 January The books and records of the Fund are maintained in US Dollars. The interim results may not be indicative of the annual results of the Fund s operations 2 REGULATING AUTHORITY The Fund is governed by the Investment Fund Regulations ( the regulations ) published by CMA on 3 Dhul Hijja 1427H (corresponding to 24 December 2006) detailing requirements for all funds operating within the Kingdom of Saudi Arabia. 3 SIGNIFICANT ACCOUNTING POLICIES These interim financial statements have been prepared in accordance with the accounting standard on interim financial reporting issued by the Saudi Organization for Certified Public Accountants (SOCPA). The significant accounting policies used in the preparation of these interim financial statements are consistent with those in the annual financial statements for the year ended 31 December, as follows: Accounting convention The financial statements are prepared under the historical cost convention modified to include the measurement of fair value of trading investment. Revenue recognition Trading income includes unrealised gains and losses from changes in fair value, unrealised exchange gains and losses and realised gains and losses from sale of trading investments. Realised gains and losses are determined on a weighted average cost basis. Special commission income is recognised on an effective yield basis. Investment valuation Investments in mutual funds are valued on the basis of net asset values published by the Fund Manager. Investment transactions Investments transactions are accounted for as of the trade date. Zakat and income tax Zakat and income tax are the obligations of the Unitholders and are not provided for in the accompanying interim financial statements. Foreign currencies Transactions in foreign currencies are translated into US Dollars at exchange rates prevailing at the transaction dates. Monetary assets and liabilities denominated in foreign currencies at balance sheet date are retranslated at the rates of exchange prevailing at that date. Resulting exchange gains and losses are included in the statement of operations. 6

8 NOTES TO THE INTERIM FINANCIAL STATEMENTS (continued) 30 June 4 TRADING INVESTMENTS Investments held for trading comprise the following: Market 30 June % of Cost Value Unrealised gains value Mutual Funds Al Arabi SAR Money Market Fund ,217,872 1,266,506 48,634 Al Arabi US Equity Fund , , ,054 Al Mubarak SAR Trade Fund , ,677 15,250 Al Mubarak Pure Saudi Equity Fund , ,256 (56,507) Al Mubarak Saudi Equity Fund , ,889 (122,301) Al Arabi Saudi Equity Fund , ,882 (70,039) Al Arabi Japan Equity Fund , ,067 27,681 Al Arabi European Equity Fund , ,806 43,342 Al Mubarak IPO Fund , ,283 3,283 Total ,292,139 4,340,536 48, December (Audited) Mutual Funds Al-Arabi SAR Money Market Fund ,333,502 1,372,627 39,125 Al-Arabi US Equity Fund , , ,521 Al-Mubarak SAR Trade Fund , ,151 12,907 Al-Mubarak Pure Saudi Equity Fund , ,757 (62,137) Al-Arabi Saudi Equity Fund , ,406 (59,515) Al Mubarak Saudi Equity Fund , ,237 (124,350) Al-Arabi Japan Equity Fund , ,572 44,186 Al-Arabi European Equity Fund , ,561 61,098 Total ,332,793 4,438, , June Mutual Funds Al Arabi US Equity Fund , , ,209 Al Mubarak SAR Trade Fund , ,892 22,472 Al Arabi SAR Money Market Fund , ,302 38,425 Al Arabi Global Bond Fund , ,762 (27,391) AlMubarak Pure Saudi Equity Fund , ,364 33,364 Al Mubarak Saudi Equity Fund , ,597 (42,695) Al Arabi Saudi Equity Fund , ,621 31,621 Al Arabi European Equity Fund , ,259 84,437 Al Arabi Japan Equity Fund , ,641 63,255 Total ,340,638 4,788, ,697 Money market funds and trade mutual funds can be redeemed any time throughout the week whereas the equity and bond funds can be redeemed only twice a week. The Fund Manager seeks to limit its risk by monitoring exposures in each mutual fund and setting limits for individual mutual funds and asset classes which they represent. 7

9 NOTES TO THE INTERIM FINANCIAL STATEMENTS (continued) 30 June 5 TRADING (LOSS) INCOME, NET Trading (loss) income, net for the six month period ended 30 June are summarised as follows: Realised gains, net 9, ,331 Movement in unrealised losses, net (57,438) (16,462) (47,893) 260,869 6 TRANSACTIONS WITH RELATED PARTIES A subscription fee of 2% may be charged to the subscribers by the Fund Manager upon subscription. As per the revised terms and conditions, dated 23 February, the Fund Manager will not charge the management fees to the Fund. Accordingly no management fees has been charged in the statement of operations for the six month period ended 30 June (30 June : 13,982). The Fund Manager charges other fee at a maximum rate of 1% per annum calculated on the total net assets at each valuation date to meet other expenses of the Fund. Other fees amounting to 6,719 (: 6,351) reflected in the statement of operations, represent the fees charged by the Fund Manager for the period as described above. The Bank (parent of the Fund Manager) acts as the Fund s banker. Unitholders account at 30 June included units held as follows: Units Units Held by the Bank 133, ,333 The employees of the Fund Manager and the Bank may also hold units in the Fund. 7 LAST VALUATION DAY The last valuation day of the period was 29 June (: 28 June ). 8