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Abridged Audited Results For The Year Ended 31 December 2016 - STXRES
SATRIX COLLECTIVE INVESTMENT SCHEME
SATRIX RESI
JSE code: STXRES
ISIN: ZAE000078622
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 4 418 514 10 118 491
Fee income: Securities lending - 123 120
Interest income 57 568 53 132
Total income 4 476 082 10 294 743
Expenses
Management fee (847 627) (965 455)
Transaction costs (191 868) (694 091)
Trustee and custodian fees (60 088) (64 340)
Total operating expenses (1 099 583) (1 723 886)
Income attributable to investors before
distribution 3 376 499 8 570 857
Income distributions (2 990 699) (8 883 577)
Income attributable to investors after
distributions (385 800) (312 720)
Realised losses on financial instruments
designated at fair value through profit or
loss (12 139 878) (92 335 123)
Unrealised gains/(losses) on financial
instruments designated at fair value through
profit or loss 66 320 034 (11 904 235)
Total fair value adjustments (54 180 156) (104 239 358)
Increase/(decrease) in net assets
attributable to investors after
distributions 54 565 956 (104 552 078)
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 245 587 587 191 938 447
Interest receivable 6 904 2 143
Cash and cash equivalents 1 230 319 127 696
Total assets 246 824 810 192 068 286
LIABILITIES
Distributions payable to investors 688 894 -
Other payables 67 819 35 129
Total liabilities (excluding net assets
attributable to investors) 756 713 35 129
Net assets attributable to investors 246 068 097 192 033 157
STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO INVESTORS
for the year ended 31 December 2016
Capital Income Net assets
attributable attributable attributable
to investors to investors to investors
R R R
Balance at 1 January 2015 272 058 601 407 430 272 466 031
Creations of Satrix RESI
Securities 24 119 204 - 24 119 204
Decrease in net assets
attributable to investors
after distributions (104 239 358) (312 720) (104 552 078)
Balance at 31 December 2015 191 938 447 94 710 192 033 157
Creations of Satrix RESI
Securities 30 845 313 - 30 845 313
Redemption of Satrix RESI
Securities (31 376 329) - (31 376 329)
Increase in net assets
attributable to investors
after distributions 54 180 156 385 800 545 565 956
Balance at 31 December 2016 245 587 587 480 510 246 068 097
STATEMENT OF CASH FLOWS
for the year ended 31 December 2016
2016 2015
R R
Net cash generated from operating activities 3 404 428 8 508 778
Cash utilised by operations (1 066 893) (1 783 812)
Fee income: Securities lending - 123 120
Interest received 52 807 50 989
Dividend received 4 418 514 10 118 491
Cash inflow/(outflow) from investing
activities 531 016 (24 119 204)
Purchase of underlying constituents (70 695 454) (264 953 910)
Sale of underlying constituents 71 226 470 240 834 706
Cash inflow/(outflow) from financing
activities (2 832 821) 13 688 245
Creation of Satrix RESI Securities 30 845 313 24 119 204
Redemption of Satrix RESI Securities (31 376 329) -
Cash distributed to security holders (2 301 805) (10 430 959)
Net movement in cash and cash equivalents 1 102 623 (1 905 844)
Cash and cash equivalents at the beginning
of the year 127 696 2 033 540
Cash and cash equivalents at the end of the
year 1 230 319 127 696
SATRIX RESI SECURITIES
During the year, 1 000 000 (2015: 1 000 000) Satrix RESI securities were
created at a value of R30 845 313 (2015: R24 119 204) and 1 000 000 (2015:
nil) Satrix RESI securities were redeemed at a value of R31 376 329 (2015:
Rnil). All creations and liquidations were in specie.
Distributions
The Portfolio effects quarterly distributions. All distributions were made
out of income of the Satrix RESI 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 RESI Security.
2016 2015
R R
3.77 cents per security
Declared 1 April 2016 and
paid 14 April 2016 282 297
74.43 cents per security
Declared 27 March 2015 and
paid 7 May 2015 4 829 000
13.95 cents per security
Declared 24 June 2016 and paid
22 July 2016 1 044 573
0.00 cents per security
Declared 26 June 2015 -
13.02 cents per security
Declared 30 September 2016 and
Paid 12 October 2016 974 935
62.56 cents per security
Declared 25 September 2015 and
Paid 22 October 2015 4 058 877
9.20 cents per security
Declared 30 December 2016 and
paid 12 January 2017 688 894
0.00 cents per security
Declared 31 December 2015 -
Accrued income portion of NAV paid
redemption/(creation) of securities - (4 300)
Total distributions 2 990 699 8 883 577
Operating Segments
The Satrix RESI 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 245 587 587 – –
Net assets attributable to
investors – (246 068 097) –
Total 245 587 587 (246 068 097) –
Level 1 Level 2 Level 3
31 December 2015 R R R
Financial instruments
designated at fair value
through profit or loss:
Listed equities 191 938 447 – –
Net assets attributable to
investors – (192 033 157) –
Total 191 938 447 (192 033 157) –
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 – 6 904 –
Cash and cash equivalents – 1 230 319 –
Total – 1 237 223 –
31 December 2016 R R R
Liabilities
Distributions payable 688 894
Other payables – – 67 819
Total – – 756 713
Level 1 Level 2 Level 3
31 December 2015 R R R
Assets
Interest receivable – 2 143 –
Cash and cash equivalents – 127 696 –
Total – 129 839 -
31 December 2015 R R R
Liabilities
Other payables – – 35 129
Total – – 35 129
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 814 937 1 056 910
Management fee payable at 31 December
Satrix Managers (RF) Proprietary Limited 67 819 35 129
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 RESI Portfolio had a TER of 41.77 (2015: 44.09) 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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