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Abridged Results as at 31 December 2017 - PREFTX
CORESHARES INDEX TRACKER COLLECTIVE INVESTMENT SCHEME
INSTRUMENT: CORESHARES PREFTRAX
ABBREVIATED NAME: PREFTRAX
SHARE CODE: PREFTX
ISIN CODE: ZAE000185658
ABRIDGED RESULTS FOR CORESHARES INDEX TRACKER COLLECTIVE INVESTMENT
SCHEME
(“CORESHARES PREFERENCE SHARE 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 327 780 852 304 234 109
loss
Distributions receivable 21 855 40 712
Cash and cash equivalents 6 144 422 11 767 942
TOTAL ASSETS 333 947 129 316 042 763
LIABILITIES
Net assets attributable to investors 333 776 931 315 275 568
CURRENT LIABILITIES
Trade and other payables 170 198 412 178
Securities purchased payable - 355 017
TOTAL LIABILITIES 333 947 129 316 042 763
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE 15 MONTHS ENDED 31 DECEMBER 2017
15 months 12 months
31 December 30 September
2017 2016
R R
Distribution income 46 421 140 28 660 823
Interest income 402 097 283 945
Total Revenue 46 823 237 28 944 768
Management and administration expenses (2 720 203) (1 580 418)
Income before taxation 44 103 034 27 364 350
Taxation - -
Income before distributions 44 103 034 27 364 350
Distributions paid (49 946 520) (24 320 737)
Income after distributions (5 843 486) 3 043 613
Realised losses on financial instruments designated at fair (10 985 635) (1 287 838)
value through profit or loss
Unrealised (losses)/gains on financial instruments (37 185 369) 7 168 694
designated at fair value through profit or loss
Total fair value adjustments - (losses)/gains (48 171 004) 5 880 856
Other comprehensive income - -
(Decrease)/increase in net assets attributable to investors (54 014 490) 8 924 469
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 270 774 641 7 230 097 278 004 738
Creation of 200 000 units on 21 October 2015 1 767 889 1 767 889
Creation of 300 000 units on 29 Octoberr 2 636 115 2 636 115
2015
Creation of 100 000 units on 10 November 876 026 876 026
2015
Creation of 150 000 units on 23 November 1 314 551 1 314 551
2015
Creation of 150 000 units on 24 December 1 275 860 1 275 860
2015
Creation of 250 000 units on 18 April 2016 2 206 602 2 206 602
Creation of 1 430 000 units on 04 July 2016 13 194 343 13 194 343
Creation of 200 000 units on 02 August 2016 1 862 998 1 862 998
Creation of 150 000 units on 16 August 2016 1 376 211 1 376 211
Creation of 200 000 units on 22 August 2016 1 840 576 1 840 576
Creation of 200 000 units on 29 August 2016 1 815 476 1 815 476
Creation of 200 000 units on 19 September 1 832 720 1 832 720
2016
Creation of 400 000 units on 23 September 3 674 716 3 674 716
2016
Liquidation of 300 000 units on 12 February (2 616 222) (2 616 222)
2016
Liquidation of 300 000 units on 23 February (2 589 070) (2 589 070)
2016
Liquidation of 250 000 units on 22 March (2 122 429) (2 122 429)
2016
Change in net assets attributable to investors 5 880 856 3 043 613 8 924 469
Balance at 30 September 2016 305 001 858 10 273 710 315 275 568
Creation of 340 000 units on 04 October 2016 3 115 677 3 115 677
Creation of 530 000 units on 26 October 2016 4 877 129 4 877 129
Creation of 250 000 units on 31 October 2016 2 305 102 2 305 102
Creation of 200 000 units on 02 November 1 847 015 1 847 015
2016
Creation of 700 000 units on 10 November 6 436 573 6 436 573
2016
Creation of 600 000 units on 15 November 5 553 127 5 553 127
2016
Creation of 700 000 units on 16 November 6 486 916 6 486 916
2016
Creation of 1 180 000 units on 21 November 10 918 171 10 918 171
2016
Creation of 500 000 units on 24 November 4 620 873 4 620 873
2016
Creation of 400 000 units on 29 November 3 708 531 3 708 531
2016
Creation of 250 000 units on 06 December 2 288 527 2 288 527
2016
Creation of 200 000 units on 13 December 1 818 103 1 818 103
2016
Creation of 500 000 units on 13 December 4 576 889 4 576 889
2016
Creation of 800 000 units on 14 December 7 308 828 7 308 828
2016
Creation of 800 000 units on 20 December 7 363 398 7 363 398
2016
Creation of 300 000 units on 21 December 2 758 967 2 758 967
2016
Creation of 300 000 units on 22 December 2 769 770 2 769 770
2016
Creation of 200 000 units on 17 January 2017 1 882 142 1 882 142
Creation of 875 000 units on 19 January 2017 8 245 547 8 245 547
Creation of 900 000 units on 26 January 2017 8 397 961 8 397 961
Creation of 150 000 units on 30 January 2017 1 385 770 1 385 770
Creation of 150 000 units on 07 February 1 384 679 1 384 679
2017
Creation of 200 000 units on 13 February 1 858 597 1 858 597
2017
Creation of 150 000 units on 22 February 1 391 042 1 391 042
2017
Creation of 600 000 units on 17 March 2017 5 548 621 5 548 621
Creation of 150 000 units on 30 March 2017 1 383 890 1 383 890
Creation of 150 000 units on 05 April 2017 1 369 385 1 369 385
Creation of 500 000 units on 18 May 2017 4 549 238 4 549 238
Creation of 500 000 units on 30 May 2017 4 578 190 4 578 190
Creation of 500 000 units on 01 June 2017 4 543 197 4 543 197
Creation of 325 000 units on 02 June 2017 2 949 492 2 949 492
Creation of 200 000 units on 27 June 2017 1 809 872 1 809 872
Creation of 40 000 units on 17 July 2017 359 796 359 796
Liquidation of 350 000 units on 06 September (3 030 115) (3 030 115)
2017
Liquidation of 650 000 units on 11 October (5 584 184) (5 584 184)
2017
Liquidation of 800 000 units on 12 October (6 838 297) (6 838 297)
2017
Liquidation of 650 000 units on 18 October (5 565 107) (5 565 107)
2017
Liquidation of 300 000 units on 09 November (2 511 791) (2 511 791)
2017
Liquidation of 600 000 units on 14 November (5 032 502) (5 032 502)
2017
Liquidation of 600 000 units on 15 November (5 017 792) (5 017 792)
2017
Liquidation of 600 000 units on 16 November (5 010 146) (5 010 146)
2017
Liquidation of 600 000 units on 17 November (5 000 977) (5 000 977)
2017
Liquidation of 711 971 units on 20 November (5 929 762) (5 929 762)
2017
Liquidation of 700 000 units on 22 November (5 849 905) (5 849 905)
2017
Liquidation of 300 000 units on 27 November (2 504 583) (2 504 583)
2017
Change in net assets attributable to investors (48 171 004) (5 843 486) (54 014 490)
Balance at 31 December 2017 329 346 707 4 430 224 333 776 931
STATEMENT OF CASH FLOWS
FOR THE 15 MONTHS ENDED 31 DECEMBER 2017
15 months 12 months
31 December 30 September
2017 2015
R R
CASH FLOWS FROM OPERATING ACTIVITIES
Cash generated from operations 43 879 911 27 463 310
Distributions paid (49 946 520) (24 320 737)
Net cash (outflow)/inflow from operating activities (6 066 609) 3 142 573
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of investments (151 620 605) (56 743 855)
Proceeds from sale of investments 79 128 529 28 155 653
Net cash outflow from investing activities (72 492 076) (28 588 202)
CASH FLOWS FROM FINANCING ACTIVITIES
Contributions received for new units created 131 224 973 35 983 940
Contributions repaid for units liquidated (58 289 808) (7 391 759)
Net cash inflow from financing activities 72 935 165 28 592 181
NET (DECREASE)/INCREASE IN CASH AND CASH (5 623 520) 3 146 552
EQUIVALENTS
CASH AND CASH EQUIVALENTS AT BEGINNING 11 767 942 8 621 390
OF THE PERIOD
CASH AND CASH EQUIVALENTS AT END OF THE 6 144 422 11 767 942
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 03:58:00 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
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