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Abridged Audited Results For The Year Ended 31 December 2016 - STXFIN
SATRIX COLLECTIVE INVESTMENT SCHEME
SATRIX FINI
JSE code: STXFIN
ISIN: ZAE000036356
A portfolio in the Satrix Collective Investment Scheme (“Satrix”),
registered as such in terms of the Collective Investment Schemes Control
Act, 45 of 2002 (the “Act”)
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
Income
Dividend income 43 715 127 25 555 432
Fee income: Securities lending - 194 976
REIT income 6 085 175 1 929 961
Interest income 611 886 268 114
Total income 50 412 188 27 948 483
Expenses
Management fee (3 926 468) (3 200 447)
Transaction costs (557 193) (240 786)
Other expenses - (659 271)
Trustee and custodian fees (86 510) (91 466)
Total operating expenses (4 570 171) (4 191 970)
Income attributable to investors before
distribution 45 842 017 23 756 513
Income distributions (45 834 204) (23 917 301)
Income attributable to investors after
distributions 7 813 (160 788)
Realised gains on financial instruments
designated at fair value through profit or
loss 121 213 528 76 509 509
Unrealised losses on financial instruments
designated at fair value through profit or
loss (97 882 990) (89 082 901)
Total fair value adjustments 23 330 538 (12 573 392)
Increase /(decrease)in net assets
attributable to investors after
distributions 23 338 351 (12 734 180)
STATEMENT OF FINANCIAL POSITION
at 31 December 2016
2016 2015
R R
ASSETS
Listed equities designated as held at fair
value through profit or loss 780 094 544 696 820 960
Interest receivable 35 151 24 866
Cash and cash equivalents 7 371 541 6 101 527
Total assets 787 501 236 702 947 353
LIABILITIES
Distributions payable to investors 6 803 414 5 543 323
Other payables 244 718 232 323
Total liabilities (excluding net assets
attributable to investors) 7 048 132 5 775 646
Net assets attributable to investors 780 453 104 697 171 707
STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO INVESTORS
for the year ended 31 December 2016
Capital Income Net assets
attributable attributable to attributable
to investors investors to investors
R R R
Balance at 1 January 2015 715 432 481 511 535 715 944 016
Creation of Satrix FINI
securities 80 536 667 - 80 536 667
Redemption of Satrix FINI
Securities (86 574 796) - (86 574 796)
Decrease in net assets
attributable to investors
after distributions (12 573 392) (160 788) (12 734 180)
Balance at 31 December 2015 696 820 960 350 747 697 171 707
Creations of Satrix FINI
Securities 558 284 719 - 558 284 719
Redemption of Satrix FINI
Securities (498 341 673) - (498 341 673)
Increase in net assets
attributable to investors
after distributions 23 330 538 7 813 23 338 351
Balance at 31 December 2016 780 094 544 358 560 780 453 104
STATEMENT OF CASH FLOWS
for the year ended 31 December 2016
2016 2015
R R
Net cash generated from operating activities 45 844 127 24 405 975
Cash utilised by operations (4 557 776) (3 546 682)
Fee income: Securities lending - 203 887
Interest received 601 601 263 377
REIT received 6 085 175 1 929 961
Dividend received 43 715 127 25 555 432
Cash (outflow)/inflow from investing
activities (59 943 046) 6 038 129
Purchase of underlying constituents (720 344 389) (177 774 013)
Sale of underlying constituents 660 401 343 183 812 142
Cash inflow/(outflow) from financing
activities 15 368 933 (29 781 630)
Creation of Satrix FINI Securities 558 284 719 80 536 667
Redemption of Satrix FINI Securities (498 341 673) (86 574 796)
Cash distributed to security holders (44 574 113) (23 743 501)
Net movement in cash and cash equivalents 1 270 014 662 474
Cash and cash equivalents at the beginning
of the year 6 101 527 5 439 053
Cash and cash equivalents at the end of the
year 7 371 541 6 101 527
SATRIX FINI SECURITIES
During the year, 40 000 000 (2015: 5 000 000) Satrix Fini securities were
created at a value of R 558 284 719(2015: R 80 536 667) and 34 000 000
(2015: 5 000 000) Satrix Fini securities were redeemed at a value of R
498 341 673 (2015: R 86 574 796). All creations and liquidations were in
specie.
Distributions
The Portfolio effects quarterly distributions. All distributions were made
out of income of the Satrix FINI Portfolio. The record dates were 1 April
2016, 24 June 2016, 30 September 2016 and 30 December 2016 respectively.
During the year under review the following distributions were effected per
Satrix FINI Security.
2016 2015
R R
0.00 cents per security
Declared 1 April 2016 -
0.00 cents per security
Declared 27 March 2015 -
35.11 cents per security
Declared 24 June 2016 and
paid 22 July 2016 27 293 457
29.88 cents per security
Declared 26 June 2015 and
paid 23 July 2015 12 769 813
14.93 cents per security
Declared 30 September 2016 and
Paid 12 October 2016 10 710 333
11.80 cents per security
Declared 25 September 2015 and
Paid 22 October 2015 5 396 965
13.15 cents per security
Declared 30 December 2016 and
paid 12 January 2017 6 803 414
12.12 cents per security 5 543 323
Declared 31 December 2015 and
paid 26 January 2016
Accrued income portion of NAV paid
redemption/(creation) of securities 1 027 000 207 200
Total distributions 45 834 204 23 917 301
Operating Segments
The Satrix FINI Portfolio offers only one product, being the specific
exchange traded fund, tracking the specific identified index.
Information regarding the results of the reportable segment is disclosed in
Financials statements as currently set out, thus no further IFRS 8
disclosure is required.
Fair value estimation
The fair value of financial assets and liabilities traded in active markets
(such as publicly traded derivatives and trading securities) are based on
quoted market prices at the close of trading at the year-end date.
The following tables analyse, within the fair value hierarchy, the
Portfolio's financial assets and liabilities (by class) measured at fair
value at 31 December:
Level 1 Level 2 Level 3
31 December 2016 R R R
Financial instruments
designated at fair value
through profit or loss:
Listed equities 780 094 544 – –
Net assets attributable to
investors – (780 453 104) –
Total 780 094 544 (780 453 104) –
Level 1 Level 2 Level 3
31 December 2015 R R R
Financial instruments
designated at fair value
through profit or loss:
Listed equities 696 820 960 – –
Net assets attributable to
investors – (697 171 707) –
Total 696 820 960 (697 171 707) –
The following table analyses, within the fair value hierarchy, the
Portfolio’s assets and liabilities (by class) not measured at fair value at
31 December but for which fair value is disclosed:
Level 1 Level 2 Level 3
31 December 2016 R R R
Assets
Interest receivable – 35 151 –
Cash and cash equivalents – 7 371 541 –
Total – 7 406 692 –
31 December 2016 R R R
Liabilities
Distributions payable to
investors – – 6 803 414
Other payables – – 244 718
Total – – 7 048 132
Level 1 Level 2 Level 3
31 December 2015 R R R
Assets
Interest receivable – 24 866 –
Cash and cash equivalents – 6 101 527 –
Total – 6 126 393 –
31 December 2015
Liabilities
Distributions payable to
investors – – 5 543 323
Other payables – – 232 323
Total – – 5 775 646
Related parties
Related parties include Satrix Managers (RF) (Proprietary) Limited in its
capacity as the management company of the Portfolio. The following related
party balances and transactions occurred during the year.
2016 2015
R R
Management fee paid
Satrix Managers (RF) Proprietary Limited 3 914 072 3 276 005
Management fee payable at 31 December
Satrix Managers (RF) Proprietary Limited 244 718 232 323
All related party transactions are conducted at arm’s length on normal
commercial terms and conditions. Outstanding balances will be settled in the
ordinary course of business.
Total Expense Ratio ('TER')
The TER is a standard measure used by the Collective Investment Scheme
(‘CIS’) industry to illustrate costs of portfolios on a comparable basis.
The TER includes the management fee, audit fees, bank charges, custodian
fees, costs related to securities lending and taxes.
The Satrix FINI Portfolio had a TER of 42.89 (2015: 45.21) basis points for
the period 1 January 2014 to 31 December 2016. The ratio is calculated based
on the Association for Savings and Investments South Africa (‘ASISA’)
standard and does not include the cost of acquiring assets.
Increased consumer demand for greater transparency in financial services and
the recognition thereof by the Collective Investment industry requires
managers to calculate and publish a total expense ratio for each Portfolio
under their management. This is a requirement in terms of the ASISA standard
on the calculation and publication of total expense ratios.
Statement of compliance
The financial statements are prepared in accordance with International
Financial Reporting Standards (‘IFRS’) issued by the International
Accounting Standards Board (‘IASB’) and SAICA Financial Reporting Guides as
issued by the Accounting Practices, the Financial Reporting Pronouncements
as issued by the Financial Reporting Standards Council and in accordance
with the requirements of the Collective Investment Schemes Control Act of
South Africa(‘CISCA’), in order to meet the requirements of the Trust Deed
approved by the Financial Services Board.
The abridged financial results have been prepared in accordance with the
framework concepts and the recognition and measurement requirements of
International Financial Reporting Standards (IFRS) and the SAICA Financial
Reporting Guides as issued by the Accounting Practices Board. The
disclosures comply with International Accounting Standards (IAS) 34.
Functional and presentation currency
These financial statements are presented in South African Rand, which is the
Portfolio’s functional currency.
Accounting policies
The financial statements incorporate the principal accounting policies that
are consistent with those adopted in the previous financial year. The new
pronouncements applicable for the financial year ending 31 December 2016 for
the first time, was assessed and did not have a significant impact to the
financial position or performance of the Portfolio.
Forthcoming requirements
New standards, amendments to standards and interpretations not yet adopted
A number of standards, amendments to standards and interpretations are not
effective for the year ended 31 December 2016, and have not been applied in
preparing these financial statements. All standards and interpretations
issued but not effective for the year ended 31 December 2016, and have been
considered. None of these are expected to have a significant effect on the
recognition and measurement of the amounts recognised in the financial
statements of the Portfolio.
Standard/Interpretation Effective date
IFRS 15 Revenue from contracts with Annual periods beginning
customers on or after 1 January 2018
IFRS 16 Leases Annual periods beginning
on or after 1 January 2019
IAS 7 amendment Disclosure initiative Annual periods beginning
on or after 1 January 2017
IAS 12 amendment Recognition of Deferred Tax Annual periods beginning
on or after 1 January 2017
Assets for Unrealised
Losses
IFRS 2 amendment Share based payments’, on Annual periods beginning
on or after 1 January 2018
clarifying how to account
for certain types of share-
based payment transactions
IFRS 4 amendment ‘Insurance contracts’ Annual periods beginning
regarding the on or after 1 January 2018
implementation of IFRS 9,
’Financial instruments’
IAS 40 amendment Transfer of investment Annual periods beginning
property on or after 1 January 2018
IAS 10 and IAS 28 Sale or contribution of Deferred until IASB has
amendment Asset between an Investor finalised research project
and its Associate or Joint
Venture
The following standards may have a significant effect on the recognition and
measurement of the amounts recognised in the financial statements of the
Portfolio.
IFRS 9 Financial Instruments Annual periods beginning
on or after 1 January 2018
Impact assessment
The IASB issued the final version of IFRS 9 Financial Instruments that
replaces IAS 39 Financial Instruments: Recognition and Measurement and all
previous versions of IFRS 9. IFRS 9 brings together all three aspects of the
accounting for the financial instruments project: classification and
measurement; impairment; and hedge accounting.
The Portfolio plans to adopt the new standard on the required effective
date. The Portfolio has performed a high-level impact assessment of all
three aspects of IFRS 9. This preliminary assessment is based on currently
available information and may be subject to changes arising from further
detailed analyses or additional reasonable and supportable information being
made available in the future. Overall, no significant impact on its balance
sheet and equity are expected.
Classification and measurement
The Portfolio does not expect a significant impact on its balance sheet or
equity on applying the classification measurement requirements for IFRS 9.
It expects to continue measuring at fair value all financial assets
currently held at fair value.
Trade and other receivables are held to collect contractual cash flows and
are expected to give rise to cash flows representing solely payments of
principal and interest. Thus, the Portfolio expects that these will continue
to be measured at amortised cost under IFRS 9. However, the Portfolio will
analyse the contractual cash flow characteristics of those instruments in
more detail before concluding whether all those instruments meet the
criteria for amortised cost measurement under IFRS 9.
Impairment
IFRS 9 requires the portfolio to record expected credit losses on all of its
debt securities, loans and trade receivables, either on a 12-month or
lifetime basis. The Portfolio expects to apply the simplified approach and
record lifetime expected losses on all trade receivables. The Portfolio does
not expect a significant impact on its equity due to the short term nature
of the receivables but it will need to perform a more detailed analysis
which considers all reasonable and supportable information, including
forward-looking elements to determine the extent of the impact.
Hedge accounting
As IFRS 9 does not change the general principles of how an entity accounts
for effective hedges, the Portfolio does not expect a significant impact as
a result of applying IFRS 9. The Portfolio will assess possible changes
related to the accounting for the time value of options, forward points or
the currency basis spread in more detail in the future.
Preparer of Abridged annual financial statements for the year ended 31
December 2016
These Abridged annual financial statements have been prepared by T du
Plessis CA (SA), the Financial Manager. The financial information has been
correctly extracted from the underlying annual financial statements. The
directors take full responsibility for the preparation of the abridged
annual financial statements.
The abridged annual financial statements are extracted from audited
information, but are not itself audited. The annual financial statements
have been audited by Ernst & Young Inc. The audited annual financial
statements and the audit report are available for inspection at the
registered office of Satrix Managers (RF) (Pty) Limited, 4th Floor, Building
2, 11 Alice Lane, Sandton.
A full copy of these financial statements is available on the Satrix website
www.satrix.co.za.
31 March 2017
Sponsor
Vunani Corporate Finance
Trustee
Standard Chartered Bank
Manager
Satrix Managers (RF) Proprietary Limited
Date: 31/03/2017 08:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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