Abridged Audited Results For The Year Ended 31 December 2016-DBXJP The db X-trackers Collective Investment Scheme db x-trackers MSCI Japan Trust JSE code: DBXJP ISIN: ZAE000115176 A portfolio in the db x-trackers Collective Investment Scheme (db x- trackers), registered as such in terms of the Collective Investment Schemes Control Act, 45 of 2002 (CISCA) ABRIDGED AUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2016 STATEMENT OF COMPREHENSIVE INCOME for the year ended 31 December 2016 2016 2015 R R Revenue 14 360 388 30 770 615 Investment income 14 360 388 12 413 809 Net fair value gain on investments at fair value through profit or loss - 18 356 806 Expenses (59 412 294) (4 569 786) Management and administrative expenses (5 389 731) (4 569 772) Net fair value loss on investments at fair value through profit or loss (54 022 563) - Foreign exchange loss on dividends - (14) Operating (loss)/profit before distribution (45 051 906) 26 200 829 Comprising: Income available for distribution before tax 8 970 657 7 844 023 Capital (loss)/gain retained (54 022 563) 18 356 806 Distributions (6 683 908) (6 119 364) (Decrease)/increase in net assets attributable to holders of redeemable securities before tax (51 735 814) 20 081 465 Withholding tax (2 195 618) (1 740 064) (Decrease)/increase in net assets attributable to holders of redeemable (53 931 432) 18 341 401 securities 2 STATEMENT OF FINANCIAL POSITION at 31 December 2016 2016 2015 R R Assets Listed investments held at fair value through profit or loss 490 941 725 871 324 964 Trade and other receivables 609 637 980 461 Cash and cash equivalents 4 580 174 6 741 460 Total assets 496 131 536 879 046 885 Liabilities Net assets attributable to holders of redeemable securities 491 646 174 872 267 934 Trade and other payables 4 485 362 6 778 951 Total liabilities 496 131 536 879 046 885 STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE SECURITIES for the year ended 31 December 2016 Total R Balance at 1 January 2015 376 814 573 Increase in net assets attributable to holders of 18 341 401 redeemable securities Creation of redeemable securities 269 356 090 Foreign currency translation adjustments 207 755 870 attributable to redeemable securities Balance at 31 December 2015 872 267 934 Decrease in net assets attributable to holders of (53 931 432) redeemable securities Redemption of securities (290 735 910) Foreign currency translation adjustments attributable to redeemable securities (35 954 418) Balance at 31 December 2016 491 646 174 3 STATEMENT OF CASH FLOWS for the year ended 31 December 2016 2016 2015 R R Cash utilised by operations (2 812 420) (344 861) Dividends received 14 712 396 10 770 658 Management fees paid (6 282 316) (2 550 358) Interest received 18 816 517 Net cash inflow from operating activities 5 636 476 7 875 956 Cash inflow/(outflow) from investing activities 290 406 258 (268 807 401) Sale/(purchase) of listed investments 290 406 258 (268 807 401) Cash (outflow)/inflow from financing activities (298 204 020) 264 882 842 (Redemption)/creation of securities (290 735 910) 269 356 090 Distributions paid to investors (7 468 110) (4 473 248) Net (decrease)/increase in cash and cash equivalents (2 161 286) 3 951 397 Cash and cash equivalents at the beginning of year 6 741 460 2 790 063 Cash and cash equivalents at the end of year 4 580 174 6 741 460 2016 2015 Number Number db x-trackers MSCI Japan redeemable securities in issue 46 000 000 72 000 000 In terms of the Trust Deed and CISCA, the Trust is required to pay the net asset value attributable to investors on redemption of securities. Vested income beneficiaries include all holders of db x-trackers MSCI Japan redeemable securities. Creations and redemptions There were no (2015: 27 000 000) creations during the year amounting to a value of nil (2015: R269 356 090). There were 26 000 000 (2015: Nil) redemptions during the current year amounting to a value of R290 735 910 (2015: Nil). 3 Distributions The Trust effects semi–annual distributions. All distributions are made out of the income of the MSCI Japan Trust. The rebates represent an investor’s partial reduction of the 85.5 basis point management fee charged (2015: 85.5 basis point management fee charged). The rebate is calculated using a sliding scale depending on the size of the investor’s investment. During the year under review, the following distributions were effected per db x-trackers MSCI Japan Redeemable Security: 2016 2015 R R Declared distributions (5 950 430) (5 399 761) 0.06300 Rand per security Declared June 2016 and paid July 2016 (3 906 210) 0.03896 Rand per security Declared June 2015 and paid July 2015 (2 571 340) 0.04460 Rand per security Declared December 2016 and paid January 2017 (2 044 220) 0.42520 Rand per security Declared December 2015 and paid January 2016 (2 828 421) Management fees refunded during the year as a rebate distribution (733 478) (719 603) Total distribution expense for the year (6 683 908) (6 119 364) Total Expense Ratio (TER) The TER represents the total expense to the Trust. The only expense to the Trust is the management fee payable to the Manager which is calculated at 0.855% of the assets under management on a daily basis (2015: 0.855% of assets under management). The Trust had a TER of 85.5 basis points (2015:85.5 basis points). Increased consumer demand for greater transparency in financial services and the recognition thereof by the collective investment industry requires Collective Investment Scheme (CIS) managers to calculate and publish a total expense ratio for each Portfolio under their management. This is a requirement in terms of the Association for Savings and Investments South Africa (ASISA) standard on the calculation and publication of total expense ratios. Statement of compliance The information in the summarised report has been extracted from the audited annual financial statements which have been prepared in accordance with the requirements of the JSE Listing Requirements for abridged reports, and the requirements of CISCA in order to meet the requirements of the Trust Deed approved by the Financial Services Board. 4 The listing requirements require abridged reports to be prepared in accordance with the framework concepts and the measurement and recognition of International Financial Reporting Standards (IFRS) and the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and the Financial Reporting Pronouncements as issued by Financial Reporting Standards Council and to also, as a minimum contain the information required by IAS 34 Interim Financial Reporting. This announcement does not include the information required pursuant to paragraph 16A(j) of IAS 34. The full report is available on the issuer’s website, at the issuer’s registered offices and upon request. These financial statements were authorised for issue by the board of directors of the Manager on 27 March 2017. Accounting policies The accounting policies applied in the preparation of the financial statements from which the summary financial statements were derived are in terms of International Financial Reporting Standards and are consistent with those accounting policies applied in the preparation of the previous annual financial statements. New standards and interpretations not yet adopted The following standards, amendments to standards and interpretations effective for the first time in future accounting periods and which are relevant to the Trust have not been adopted for the reporting periods beginning on or after 1 January 2016: IFRS 9 Financial Instruments – IFRS 9 will be effective for the Trust’s annual reporting period starting 1 January 2018. IFRS 9 will replace the current classification, recognition and measurement requirements of IAS 39 Financial Instruments: Recognition and Measurement. Management expects that the impact of the application of IFRS 9 in the financial statements would be minimal, due to the following reasons: - The Trust’s largest financial instruments are listed equity instruments. These instruments are currently measured at fair value through profit or loss. IFRS 9 requires that all equity instruments be measured at fair value with changes in profit or loss, except for those equity instruments not held for trading and the entity has elected to present the changes in fair value in other comprehensive income. The Trust is not making this alternative accounting election. - Trade and other receivables comprise of short term receivables with established rights and low risk of default. These instruments would continue to be measured at amortised cost in accordance with IFRS 9. It is expected that any associated expected credit losses on these receivables will be minimal. - The financial liabilities comprise mostly of redeemable securities which is designated at fair value through profit or loss. The Trust will continue to designate the liabilities at fair value through profit or loss in accordance with IFRS 9. This is because the liabilities are managed and the performance evaluated on a fair value basis. 5 - Trade and other payables that are financial instruments would continue to be measured at amortised cost. These payables comprise of short term payables. - Fair value changes, dividend income and equalisation on investment appropriations would be recognised in accordance with IFRS 9. The recognition and measurement of these items will remain consistent with the current accounting policy. IFRS 15 Revenue from Contracts with Customers - IFRS 15 will be effective for the Trust’s annual reporting period starting 1 January 2018. IFRS 15 replaces the current effective standards on recognition and measurement of revenues, including IAS 18 Revenue. Management expects that there will be no impact on the application of IFRS 15 due to the following: - IFRS 15 excludes those contractual rights and obligations within the scope of IFRS 9. As noted above, all investment returns will be accounted for in accordance with IFRS 9. Investment income Investment income comprises: - interest income earned on cash and cash equivalents; - cash equalisation component on creations (at the time of creation it represents the income portion attributable to the net asset value at the time that is payable by the creating party); - dividends from listed equities at fair value through profit or loss. Interest income Interest income is recognised in profit or loss, using the effective interest method taking into account the expected timing and amount of cash flows. Dividend income Dividend income is recognised when the right to receive the payment is established. This is usually the ex-dividend date for quoted equities. Audit report This summarised report is itself not reviewed or audited but is extracted from the underlying audited information. The audited annual financial statements for the year ended 31 December 2016 from which the summarised report has been extracted were audited by KPMG Inc, who expressed an unmodified opinion thereon. A copy of the auditor’s report on the audited annual financial statements is available for inspection at the company’s registered office together with the annual financial statements identified in the respective auditor’s reports. A full copy of these financial statements is available on the db x-trackers website www.dbxtrackers.co.za. Directors’ responsibility 6 The directors take full responsibility for the preparation of the abridged report and confirm that the financial information has been correctly extracted from the underlying annual financial statements. Sponsor Vunani Corporate Finance Trustee Standard Bank of SA Limited Manager db x-trackers Proprietary Limited 30 March 2017 Date: 30/03/2017 07:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.