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Abridged Results as at 31 December 2017 - LVLTRX
CORESHARES INDEX TRACKER COLLECTIVE INVESTMENT SCHEME
INSTRUMENT: CORESHARES LOWVOL TRAX
ABBREVIATED NAME: LOWVOL TRAX
SHARE CODE: LVLTRX
ISIN CODE: ZAE000190112
ABRIDGED RESULTS FOR CORESHARES INDEX TRACKER COLLECTIVE INVESTMENTS
SCHEME
(“CORESHARES S&P SOUTH AFRICA LOW VOLATILITY EXCHANGE TRADED FUND”)
AS AT 31 DECEMBER 2017
STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2017
31 December 30 September
2017 2016
R R
ASSETS
CURRENT ASSETS
Listed investments held at fair value through profit or loss 20 787 245 29 929 175
Distributions receivable 5 294 39 978
Cash and cash equivalents 125 567 373 162
TOTAL ASSETS 20 918 106 30 342 315
LIABILITIES
Net assets attributable to investors 20 795 185 30 157 225
CURRENT LIABILITIES
Trade and other payables 122 921 185 090
TOTAL LIABILITIES 20 918 106 30 342 315
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE 15TH MONTHS ENDED 31 DECEMBER 2017
15 months 12 months
31 December 30 September
2017 2016
R R
Distribution income 1 266 525 1 067 486
Interest income 29 446 8 781
Total Revenue 1 295 971 1 076 267
Management and administration expenses (257 487) (153 099)
Income before taxation 1 038 484 923 168
Taxation - -
Income before distributions 1 038 484 923 168
Distributions paid (990 221) (890 612)
Income after distributions 48 263 32 556
Realised (losses)/gains on financial instruments (1 032 156) 525 615
designated at fair value through profit or loss
Unrealised gains /(losses) on financial 627 171 (1 024 302)
instruments designated at fair value through profit
or loss
Total fair value adjustments - losses (404 986) (498 686)
Other comprehensive income - -
Decrease in net assets attributable to investors (356 723) (466 130)
STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO INVESTORS
FOR THE 15 MONTHS ENDED 31 DECEMBER 2017
Accumulated
Capital Profit Total
R R R
Balance at 30 September 2015 23 246 697 157 776 23 404 473
Creation of 50 000 units on 07 October2015 1 451 198 1 451 198
Creation of 50 000 units on 03 November 1 490 019 1 490 019
2015
Creation of 50 000 units on 03 December 1 425 981 1 425 981
2015
Creation of 50 000 units on 04 March 2016 1 373 315 1 373 315
Creation of 50 000 units on 29 June 2016 1 375 455 1 375 455
Creation of 50 000 units on 29 July 2016 1 449 803 1 449 803
Creation of 50 000 units on 18 August 2016 1 450 500 1 450 500
Liquidation of 100 000 units on 26 May 2016 (2 797 390) (2 797 390)
Change in net assets attributable to investors (498 686) 32 556 (466 130)
Balance at 30 September 2016 29 966 893 190 332 30 157 225
Creation of 50 000 units on 02 November 1 367 237 1 367 237
2016
Liquidation of 110 000 units on 02 June 2017 (2 966 337) (2 966 337)
Liquidation of 100 000 units on 06 September (2 694 102) (2 694 102)
2017
Liquidation of 75 000 units on 07 November (2 012 988) (2 012 988)
2017
Liquidation of 100 000 units on 09 November (2 699 127) (2 699 127)
2017
Change in net assets attributable to investors (404 986) 48 263 (356 723)
Balance at 31 December 2017 20 556 590 238 595 20 795 185
STATEMENT OF CASH FLOWS
FOR THE 15 MONTHS ENDED 31 DECEMBER 2017
15 months 12 months
31 30
December September
2017 2016
R R
CASH FLOWS FROM OPERATING ACTIVITIES
Cash generated from operations 1 010 999 960 877
Distributions paid (990 221) (890 612)
Net cash inflow from operating activities 20 778 70 265
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of investments (27 844 (33 820
346) 574)
Proceeds from sale of investments 36 600 602 27 137 610
Net cash inflow/(outflow) from investing activities 8 756 256 (6 682 964)
CASH FLOWS FROM FINANCING ACTIVITIES
Contributions received for new units created 1 365 075 10 023 601
Contributions repaid for units liquidated (10 389 (2 800 862)
704)
Net cash (outflow)/ inflow from financing activities (9 024 629) 7 222 739
NET (DECREASE)/INCREASE IN CASH AND CASH (247 595) 610 040
EQUIVALENTS
CASH AND CASH EQUIVALENTS/ (BANK OVERDRAFT) 373 162 (236 878)
AT BEGINNING OF THE PERIOD
CASH AND CASH EQUIVALENTS AT END OF THE 125 567 373 162
PERIOD
ACCOUNTING POLICIES
FOR THE 15 MONTHS ENDED 31 DECEMBER 2017
The financial statements have been prepared consistently based on the following principal accounting policies
which are consistent with those applied in the previous period:
1. Basis of Preparation
The financial statements are prepared on a historic cost basis, except for certain financial instruments, which are
accounted for at fair value.
The financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS’’),
its interpretations adopted by the International Accounting Standards Board (“IASB”), the South African Institute of
Chartered Accountants Financial Reporting Guides as issued by the Accounting Practices Committee and
Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council, the JSE Listings
Requirements, the requirements of the Coreshares Index Tracker Collective Investment Scheme Deed and the
Collective Investment Schemes Control Act, 45 of 2002 ("the Act").
At the date of approval of the annual financial statements, the following new standards and amendments that
apply to the Scheme were in issue but not yet effective:
New standards and amendments to standards and interpretations not
yet adopted
IFRS 9 - Financial Instruments: Finalised version, incorporating requirements for classification and measurement,
impairment, general hedge accounting and derecognition - Applies to annual periods beginning on or after 1
January 2018.
IFRS 15 - Revenue from contracts with customers - Applies to annual periods beginning on or after 1 January
2018.
IFRS16 – Leases - Applicable to annual reporting periods beginning on or after 1 January 2019.
IFRS17 – Insurance contracts - Applicable to annual reporting periods beginning on or after 1 January 2021.
IFRIC 23 Uncertainty over Income Tax Treatments. Effective for annual periods beginning on or after 1 January
2019.
Prepayment Features with Negative Compensation (Amendments to IFRS 9). Effective for annual periods
beginning on or after 1 January 2019.
Annual Improvements to IFRS Standards 2015–2017 Cycle. Effective for annual periods beginning on or after 1
January 2019.
The entity plans to adopt these standards when they become effective.
The manager anticipates that the adoption of applicable standards and interpretations in future periods will have
the following impact on the financial statements of the Scheme.
IFRS 9 - Financial Instruments: - under the current business model investments are held at fair value through profit
or loss, receivables are measured at amortised cost and cash and cash equivalents are measured at fair value.
Financial liabilities are held at fair value through profit or loss. No change is anticipated for initial recognition of
either financial assets or financial liabilities.
IFRS 15 - Revenue from contracts with customers - due to the nature of the Scheme's revenue, being income
from investments, no change is anticipated for recognition and measurement of revenue.
IFRS16 – Leases - is not applicable to the Scheme as no items are leased.
IFRS17 – Insurance contracts - is not applicable to the manager and the Scheme
The manager anticipates that the adoption of amendments to existing standards in future periods will have no
material impact on the financial statements of the Scheme.
Amendments to existing standards that became effective during the period
IAS 12 - Recognition of Deferred Tax Assets for Unrealised Losses. Effective for annual periods beginning on or
after 1 January 2017
IAS 7 - Disclosure Initiative. Effective for annual periods beginning on or after 1 January 2017
Annual Improvements to IFRS Standards 2014–2016 Cycle. The amendments to IFRS 1 and IAS 28 are effective
for annual periods beginning on or after 1 January 2018, the amendment to IFRS 12 for annual periods beginning
on or after 1 January 2017
The standards and amendments adopted in the current period have had no material impact on the financial
statements of the Scheme.
2. Functional and reporting currency
The annual financial statements are presented in South African Rands which is the functional currency of the
Scheme.
3. Use of estimates and judgements
The preparation of financial statements in conformity with IFRS requires the use of certain critical estimates,
judgements and assumptions that affect the reported amounts. It also requires management to exercise its
judgement in the Scheme’s process of applying the accounting policies. Actual results may vary from these
estimates. There are no areas involving a higher degree of judgement complexities or areas where assumptions or
estimates are significant.
4. Financial Instruments
Measurement
Financial instruments are recognised when the Scheme becomes a party to the contractual provisions of that
particular instrument. Financial instruments are initially measured at fair value, which except for financial
instruments at fair value through profit or loss, includes direct attributable transaction costs. Subsequent to initial
recognition, these instruments are measured as set out below.
Investments
Listed investments are designated as held at fair value through profit or loss. Fair value is determined with
reference to quoted market prices at the reporting date, as published in the financial press at the reporting date.
Receivables
Receivables comprise of contributions receivable and distributions receivable, and are measured at amortised cost
using the effective interest rate method.
Cash and cash equivalents
Cash and cash equivalents comprises of bank balances and are measured at fair value.
Financial liabilities
Financial liabilities, trade payable, distributions payable and securities purchases payable are initially measured at
fair value through profit or loss and are subsequently measured at amortised cost using the effective interest rate
method. Financial liabilities arising from the securities issued by the Scheme are carried at fair value representing
the investor’s right to a residual interest in the Scheme’s net assets, i.e. the net asset value of the Scheme.
Changes in the fair value are included in profit or loss in the period in which the change arises.
Derecognition of financial instruments
The Scheme derecognises financial assets when:
- The contractual rights to the cash flows arising from the financial assets have expired or have been
forfeited by the Scheme; or
- It transfers the financial assets including substantially all the risks and rewards of ownership of the
assets; or
- It transfers the financial assets, neither retaining nor transferring substantially all the risks and rewards
of the ownership of the asset, but no longer retains control of the asset.
The difference between the carrying value of financial assets derecognised at the date of derecognition, and
proceeds, is recorded as a realised gain or loss in profit or loss.
A financial liability is derecognised when the liability is extinguished. This is, when the obligation specified in the
contract is discharged, cancelled or has expired. The difference between the carrying amount of a financial liability
(or part thereof) extinguished or transferred to another party and consideration paid, including any non-cash
assets transferred or liabilities assumed, is recognised in profit or loss.
5. Revenue
Revenue comprises distribution income and interest income.
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.
Distribution income
Distribution income in the form of cash is recognised when the right to receive payment is established.
6. Income tax
Under the current system of taxation in South Africa, the Scheme is exempt from paying tax on income if
distributed within twelve months and exempt from paying tax on capital gains. Both income and capital gains are
taxed in the hands of investors.
7. Expenses
Expenses are recognised in profit or loss on the accrual basis.
8. Distributions
Distributions payable on redeemable securities are recognised in profit or loss as distributions.
In accordance with the CoreShares Index Tracker Collective Investment Scheme Deed, the Scheme distributes its
distributable income and any other amounts determined by the Manager, to security investors in cash. The
distributions are payable shortly after the end of each quarter and recognised in profit or loss as distributions.
9. Creations and redemptions
Investors can acquire the Scheme's securities by trading on the JSE. These purchases will be made at the current
market price of the securities plus a brokerage fee that is negotiable with the broker and any additional transaction
costs applicable to such a trade.
Investors can also acquire the Scheme's securities by subscribing for them directly from the Scheme. The cash
subscription price and number of the Scheme's securities to be issued to an investor for cash will be determined
by the amount which the investor invests (net of transaction costs) and will be a function of the pro rata cost to the
portfolio of acquiring the underlying basket of securities.
Investors subscribing for the Scheme's securities, by the delivery of one or more full baskets of constituent
securities, are obliged to deliver securities with a perfect match to the index.
Investors may sell securities by trading on the JSE, at the current market price quoted on the JSE. Investors may
also redeem securities directly with the Scheme.
Securities prices are determined by reference to the net assets of the Scheme divided by the number of securities
in issue. For unit pricing purposes, net assets are determined using the last reported trade price for securities.
These prices may differ from the market price quoted on the JSE.
10. Redeemable securities
All redeemable securities issued by the Scheme provide investors with the right to require redemption for cash or
in specie at the value proportionate to the investors’ share. Such instruments give rise to a financial liability for the
net asset value of the redemption amount in the Scheme’s net assets at redemption date. In accordance with the
CoreShares Index Tracker Collective Investment Scheme Deed and the Act, the Scheme is contractually obliged
to redeem securities at the net asset value. A redemption fee, depending on the size of the recall, would be
payable by the investor making the redemption.
Net assets attributable to security
11. investors
Securities are redeemable at the security investor’s option and are therefore classified as financial liabilities. The
securities may be sold back to the Scheme at anytime. The fair value of redeemable securities is measured at the
redemption amount that is payable (in cash and securities representing each investor’s equal, undivided and
vested interest in the assets as a whole, subject to liabilities, as defined by the CoreShares Index Tracker
Collective Investment Scheme Deed) at the reporting date if security investors exercise their right to put the
securities back to the Scheme.
12. Increase/decrease in net assets attributable to security investors
Income not distributed is included in net assets attributable to security investors.
The financial information set out in this announcement is based on the financial statements which have been
audited by the auditors Deloitte & Touche. Their unmodified audit report is available for inspection at the
Manager’s registered address.
The directors take full responsibility for the preparation of the abridged financial information which have been
extracted correctly from the underlying audited annual financial statements.
The full financial statements are available on www.coreshares.co.za
03 April 2018
Date: 03/04/2018 03:55:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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