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CORESHARES INDEX TRACKER MANAGERS (RF) PROPRIETARY LIMITED - Preliminary results for coreshares index tracker collective investment scheme (PROPTRAX SAPY") at 31 December 2018

Release Date: 29/03/2019 16:35
Code(s): PTXSPY     PDF:  
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Preliminary results for coreshares index tracker collective investment scheme (“PROPTRAX SAPY")
at 31 December 2018

CORESHARES INDEX TRACKER COLLECTIVE INVESTMENT SCHEME
INSTRUMENT: CORESHARES PROPTRAX SAPY
ABBREVIATED NAME: PROPTRAX SAPY
SHARE CODE: PTXSPY
ISIN CODE: ZAE000101911

PRELIMINARY RESULTS FOR CORESHARES INDEX TRACKER COLLECTIVE INVESTMENT SCHEME
(“CORESHARES PROPERTY SAPY EXCHANGE TRADED FUND”)
AS AT 31 DECEMBER 2018

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2018

                                                               2018                 2017
                                                               R                    R


ASSETS


Listed investments held at fair value through profit or loss          129 832 291          167 341 004
Distributions receivable                                                   55 749                5 174
Cash and cash equivalents                                               2 707 508              571 527


TOTAL ASSETS                                                          132 595 548          167 917 705


LIABILITIES


Net assets attributable to investors                                  132 468 871          167 790 251
Trade and other payables                                                 126 677              127 454


TOTAL LIABILITIES                                                     132 595 548          167 917 705
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE 12 MONTHS ENDED 31 DECEMBER 2018


                                                                          Represented
                                                    12 months             15 months
                                                    2018                  2017
                                                    R                     R


Distribution income                                         11 359 387           11 419 463
Interest income                                                 57 268                82 457
Total revenue                                            11 416 655           11 501 920
Management and administration expenses                       (808 396)           (1 117 321)
Income before taxation                                   10 608 259           10 384 599
Taxation                                                            -                     -
Income before distributions                              10 608 259           10 384 599
Distributions paid                                         (12 040 384)          (9 416 548)
(Loss)/income after distributions                          (1 432 125)            968 051


 Net fair value (losses)/gains on financial                (54 955 492)          15 279 462
instruments at fair value through profit or loss

(Loss)/income after net fair value (losses)/gains       (56 387 617)          16 247 513
 Other comprehensive income                                        -                    -
 (Decrease)/increase in net assets attributable         (56 387 617)          16 247 513
to investors
STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO INVESTORS
FOR THE 12 MONTHS ENDED 31 DECEMBER 2018

                                                                     Accumulated
                                                  Capital            Profit               Total
                                                  R                  R                    R


Balance at 30 September 2016                          151 545 000             2 399 699       153 944 699


Creation of 225 000 units on 13 October 2016           14 327 251                              14 327 251
 Creation of 160 000 units on 15 November               9 992 899                                 9 992 899
2016
 Creation of 150 000 units on 27 October 2017          10 084 926                              10 084 926
 Liquidation of 40 000 units on 24 November            (2 490 397)                                (2 490 397)
2016
 Liquidation of 60 000 units on 28 November            (3 739 892)                                (3 739 892)
2016
 Liquidation of 45 000 units on 06 December            (2 774 046)                                (2 774 046)
2016
 Liquidation of 65 000 units on 08 December            (4 023 588)                                (4 023 588)
2016
 Liquidation of 50 000 units on 06 January 2017        (3 254 513)                                (3 254 513)
Liquidation of 50 000 units on 30 January 2017         (3 318 561)                                (3 318 561)
 Liquidation of 40 000 units on 24 February            (2 675 189)                                (2 675 189)
2017
 Liquidation of 140 000 units on 06 April 2017         (8 810 785)                                (8 810 785)
Liquidation of 50 000 units on 20 July 2017            (3 338 629)                                (3 338 629)
 Liquidation of 35 000 units on 21 November            (2 381 438)                                (2 381 438)
2017
 Change in net assets attributable to investors        15 279 462              968 051         16 247 513


Balance at 31 December 2017                           164 422 501             3 367 750       167 790 251




Creation of 35 000 units on 04 January 2018             2 452 743                                 2 452 743
Creation of 66 380 units on 22 January 2018             4 375 258                                 4 375 258
Creation of 50 000 units on 23 January 2018             3 320 325                                 3 320 325
Creation of 75 000 units on 25 January 2018             5 021 739                                 5 021 739
Creation of 30 000 units on 12 April 2018               1 783 490                                 1 783 490
Creation of 35 000 units on 15 June 2018                1 979 634                                 1 979 634
 Creation of 117 420 units on 20 December               5 733 512                                 5 733 512
2018
 Liquidation of 35 000 units on 08 May 2018            (2 034 548)                                (2 034 548)
Liquidation of 30 000 units on 17 October 2018         (1 565 916)                                (1 565 916)
Change in net assets attributable to investors        (54 955 492)        (1 432 125)         (56 387 617)


Balance at 31 December 2018                           130 533 246             1 935 625       132 468 871
STATEMENT OF CASH FLOWS
FOR THE 12 MONTHS ENDED 31 DECEMBER 2018

                                                      12 months                  15 months
                                                      2018                       2017
                                                      R                          R


CASH FLOWS FROM OPERATING ACTIVITIES


Cash generated from operations                                     10 556 907                11 110 993
Distributions paid                                                (12 040 384)               (9 416 548)

Net cash (outflow)/inflow from operating activities                (1 483 477)                1 694 445

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of investments                                           (49 147 927)          (172 978 286)
Proceeds from sale of investments                                  31 486 980            168 850 833


Net cash outflows from investing activities                       (17 660 947)               (4 127 453)


CASH FLOWS FROM FINANCING ACTIVITIES


Contributions received for new units created                       24 888 409                37 903 878
Contributions repaid for units liquidated                          (3 608 004)           (37 070 990)


Net cash inflow from financing activities                          21 280 405                  832 888


NET INCREASE/(DECREASE) IN CASH AND CASH                            2 135 981                (1 600 120)
EQUIVALENTS

CASH AND CASH EQUIVALENTS AT BEGINNING                                571 527                 2 171 647
OF THE YEAR

CASH AND CASH EQUIVALENTS AT END OF THE                             2 707 508                  571 527
YEAR
ACCOUNTING POLICIES
FOR THE 12 MONTHS ENDED 31 DECEMBER 2018


The financial statements have been prepared consistently based on the following principal accounting policies
which are consistent with those applied in the previous period, except for IFRS 9:

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 and contain the information required by 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
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.
Amendments to References to the Conceptual Framework in IFRS Standards - Annual periods beginning on or
after 1 January 2020.
Definition of Material (Amendments to IAS 1 and IAS 8) - Annual reporting periods beginning on or after 1
January 2020.

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.
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 as there are no insurance
contracts.
IFRIC 23 - Uncertainty over Income Tax Treatments - is not applicable as the Scheme is not taxed.

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
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 Manager has concluded that the standards and amendments adopted in the current period have had no
material impact on the financial statements of the Scheme.

The following new standards were adopted by the Scheme for the 2018 financial year:
IFRS 9 Financial Instruments (refer to 1.1 below)
IFRS 15 Revenue from Contracts with Customers (refer to 1.2 below)

Basis of Preparation (continued)
IFRS 9 Financial Instruments
"IFRS 9 replaces IAS 39 – ‘Financial Instruments’ (“IAS 39”) and introduces new requirements for recognition,
classification, measurement and derecognition of financial assets and financial liabilities, and the impairment of
financial assets.

The Scheme elected not to early adopt any of the provisions of IFRS 9 in previous financial reporting periods.
The classification and measurement requirements of IFRS 9 have been adopted prospectively as at the date of
initial application on 1 January 2018. The following table shows the original measurement categories in
accordance with IAS 39 and the new categories in accordance with IFRS 9:"
                                                 IAS 39            IFRS 9             Measurement
                                                 classification    classification     changes
Financial Assets
Receivables                                      Financial asset    Financial asset       None
                                                 at amortised       at amortised
                                                 cost               cost
Investments                                      Designated at      FVTPL                 None
                                                 FVTPL
Cash and cash equivalents                        Financial asset    Financial asset       None
                                                 at amortised       at amortised
                                                 cost               cost
Financial Liabilities
Payables                                         Financial          Financial liability   None
                                                 liability at       at amortised
                                                 amortised cost     cost
Net assets attributable to investors             FVTPL              FVTPL                 None



Revenue from Contracts with Customers
The Scheme has adopted IFRS 15: ‘Revenue from Contracts with Customers’ (“IFRS 15”) from 1 January 2018.
The adoption of the new standard did not result in any changes to accounting policies relating to revenue
recognition.
Functional and reporting currency
The annual financial statements are presented in South African Rands which is the functional currency of the
Scheme.
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.

Financial Instruments
Financial assets and financial liabilities are recognised in the Scheme’s balance sheet when the Scheme
becomes party to the contractual provisions of the instrument. Financial assets and financial liabilities are
measured at fair value on initial recognition.

Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities
(other than financial assets and financial liabilities at fair value through profit and loss (“FVTPL”)) are added to or
deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition.
Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at FVTPL are
recognised immediately in profit or loss.

Financial assets
All financial assets are recognised on the trade date, and are initially measured at fair value, plus transaction
costs, except for those financial assets classified as at FVTPL.

Financial assets at amortised cost
"Financial assets are classified and measured at amortised cost if:
•      these assets are held to collect contractual cash flows; and
•      the asset’s contractual cash flows represent solely payments of principal and interest                       (""SPPI”).

Financial assets included within this category are initially recognized at fair value and are subsequently measured
at amortised cost using the effective interest method."

Financial assets at FVTPL
"Financial assets classified and measured at FVTPL are:
•      assets with contractual cash flows that are not SPPI; or
•      assets that are held in a business model other than to collect contractual cash flows or to collect and sell.

The financial assets have been classified into the following categories:"

Investments
"Listed investments are held at FVTPL. Fair value is determined with reference to quoted market prices at the
reporting date, as published in the financial press at the reporting date. The investments are measured at fair
value, with any gains/losses arising on subsequent measurement recognised in profit or loss.

Distribution income earned on these instruments are recorded separately in the statement of profit or loss and
other comprehensive income."

Receivables
Receivables comprise of contributions receivable and distributions receivable. The receivable balance recognised
represents the fair value at initial recognition. The objective of the Scheme is to “hold to collect” contractual cash
flows, and these receivables are subsequently measured at amortised cost using the effective interest method.

Cash and cash equivalents
The objective of the Scheme is to “hold to collect” contractual cash flows. The principal amount represents the
fair value of the cash balance at initial recognition. Cash and cash equivalents are subsequently measured at
amortised cost, using the effective interest method.

Impairment of financial assets
"The Scheme holds short term receivables with no financing component, which have maturities of less than 3
months at amortised cost. The Scheme has adopted a simplified approach for expected credit losses (ECL)
under IFRS 9.

The Scheme uses the provision matrix as a practical expedient to measuring ECLs on receivables, based on
days past due for receivables with similar loss patterns. The provision matrix is based on historical observed loss
rates over the expected life of the receivables and is adjusted for forward-looking estimates."

Financial liabilities are classified as either financial liabilities ‘at FVTPL’ or ‘other financial liabilities’.

Financial liabilities at FVTPL
"Financial liabilities are classified as at FVTPL when the financial liability is designated as such at initial
recognition.
Financial liabilities arising from 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. "

Other financial liabilities
Other financial liabilities, including trade payables, distributions payable and securities purchases payable by the
Scheme, are initially measured at fair value, net of transaction costs. Other financial liabilities are subsequently
measured at amortised cost using the effective interest method.

Revenue
Revenue comprises distribution income and interest income.

Distribution income
Distribution income in the form of cash is recognised when the right to receive payment is established.
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.

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.

Management and administration expenses
Expenses are recognised in profit or loss on the accrual basis.

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."

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."

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 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.

Increase/decrease in net assets attributable to security investors
Income not distributed is included in net assets attributable to security investors.

This preliminary report is extracted from audited information, but is not itself audited.
The Directors take full responsibility for the preparation of the preliminary report and that the financial information
has been correctly extracted from the underlying annual financial statements.

29 March 2019
Sponsor: Grindrod Bank Limited

Date: 29/03/2019 04:35:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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