ZB trend - otvoreni investicijski fond Zagrebačke banke

Transcription

ZB trend – otvoreni investicijski fond s javnom
ponudom
Financial statements for the year ended
31 December 2012
This version of the accompanying documents is a translation from the original, which was prepared in
the Croatian language. All possible care has been taken to ensure that the translation is an accurate
representation of the original. However, in all matters of interpretation of information, views or
opinions, the original language version of our financial reports and the accompanying audit report
takes precedence over this translation.
ZB trend - otvoreni investicijski fond s javnom ponudom
Financial statements for the year ended 31 December 2012
Contents
Management Company’s report
1
Responsibilities of the Management Board of the Management Company
for the preparation and approval of the annual financial
statements
3
Independent Auditors’ Report to the unitholders of ZB trend – otvoreni
investicijski fond s javnom ponudom
4
Statement of comprehensive income
6
Statement of financial position
7
Statement of changes in net assets attributable to unitholders’ funds and
units
8
Statement of cash flows
9
Notes to the financial statements
10
Appendix 1 – Financial statements in accordance with the Ordinance on
the structure and content of financial statements of open ended
investment funds
33
Appendix 2 – Reconciliation of financial statements in accordance with
IFRS and statements in accordance with the Ordinance on the
structure and content of financial statements of open ended
investment funds
38
Management Company’s report
ZB Invest d.o.o. za upravljanje investicijskim fondovima (“the Management Company”) presents the annual report
of ZB trend - otvoreni investicijski fond s javnom ponudom (“the Fund”) for the year ended 31 December 2012.
Principal activity
ZB trend - otvoreni investicijski fond s javnom ponudom is an open ended investment fund available to the general
public.
The objective of balanced fund ZB trend is the long term increase of the unit value, expressed in EUR, through
investing its assets in globally diversified portfolio of debt and equity securities, and in investment funds with
targeted portfolio structure of 70% shares, 30% bonds and other interest earning instruments.
Results
In 2012 the Fund achieved a return of 1.27% expressed in EUR. Throughout the year, 72.76% of the average
Fund's portfolio was invested in equities and equity ETFs, while the remaining Fund's assets consisted of domestic
and foreign debt securities and money market instruments.
In the year 2012 stock market movements were mostly influenced by the sentiment associated with the European
sovereign debt crisis. In moments when market risks declined, equities were gaining in value but when negative
news prevailed, investors turned more cautious and equity prices were falling. The world economy is still
recovering very slowly. Emerging markets were the main driver of global growth last year, but their outputs were
lower than before the crisis. In developed countries fiscal consolidation and restructuring continued and high
unemployment and low consumer confidence have further deepened the negative impact on economic activity.
ECB (European Central Bank), the Fed (U.S. Federal Reserve System), and the BoJ (The Bank of Japan) continued
to implement expansive monetary policy and were constantly prepared to introduce new measures if needed. Thus,
the introduction of OMT program in September as unlimited non-standard monetary program by ECB was a
significant step towards returning investor confidence and bond liquidity of peripheral EMU countries. In the last
quarter, the focus shifted from Europe to the U.S. Investors were concerned with the outcomes of U.S. presidential
elections in November, decision about fiscal cliff and turmoil concerning impending debt ceiling. Agreement on
extension of tax breaks was not achieved until the last day of the 2012, when reliefs were automatically scheduled
to expire but failing to reach an agreement for the U.S. economy could have meant a large drop in GDP and a
probable recession. Consequently in recent months the economic activity in the U.S. was weak. Last year in Japan
was a year of recovery and reconstruction in which many companies profited and announced good business results.
The change of government in December prompted the enthusiasm of investors because it promised an expansionary
monetary policy and tax reliefs for companies. Although Japan's structural problems can not disappear overnight, a
significant shift in political rhetoric that will encourage economic growth is obvious. High government debt of
European countries and increasingly the U.S. remains pervasive problem. In weak economic environment stocks
have often been very volatile, and expansionary monetary policy was mainly responsible for growth of equity
indices in developed countries.
Gross yield of the money market segment of the portfolio was 3.24%, while gross yield of the bond segment was
20.5%. In the bond segment of the portfolio the most important change occurred in the position of Gazprom, where
the short bond denominated in euro was replaced with dollar bond of approximately same maturity due to safety of
the dollar currency. Gross yield of the equity segment of the portfolio was 3.32%. Net yield depends on each asset
class share in the portfolio during the year and on fees defined in Prospectus. Largest positive contribution to the
performance of the Fund was provided by investments in the tobacco industry, capital goods, power distribution
and purification and distribution of water. Significant negative contribution to the performance was provided by the
industry of coal extraction and processing caused by the extremely warm winter in the United States, by the
industry of fertilizers and agricultural additives following a significant drop in oil prices in the first half of the year,
by the the extractors of precious metals and providers of IT services in healthcare. The greatest impact in the last
mentioned sector had a drop of 50% in value of Allscripts Healthcare due to administrative failures in the
integration of society Eclipsys, although the company continues to have solid fundamentals.
1
for the year ended 31 December
Notes
2012
HRK’000
2011
HRK’000
5
6
1,587
1,604
2,102
2,758
7
4,463
(6,623)
370
(2,918)
8,024
(4,681)
(2,193)
(329)
(178)
(3,108)
(466)
(317)
(2,700)
(3,891)
Net increase/(decrease) in unitholders’ funds from investment
activities
Other comprehensive income
Movement in adjustment for difference in valuation inputs
5,324
-
(8,572)
(30)
Total net increase/(decrease) in unitholders’ funds from
investment activities
5,324
(8,602)
Interest income
Dividend income
Net gains/(losses) on financial assets and liabilities at fair value
through profit or loss
Net gains/(losses) on translation of monetary assets and liabilities
denominated in foreign currencies
Net investment income/(loss)
Investment management fees
Custody fees
Other operating expenses
Operating expenses
8
9
10
The accounting policies and other notes on pages 10 to 32 form an integral part of these financial statements.
6
as at
Notes
Assets
Giro accounts with banks
Financial assets at fair value through profit or loss
Loans and receivables
Other assets
11
12
13
14
31 December 31 December
2011
2012
HRK’000
HRK'000
22,456
86,535
1,363
109
9,748
108,510
4,114
131
110,463
122,503
14,558
9,303
Total liabilities
14,558
9,303
Net assets attributable to unitholders’ funds
95,905
113,200
comprise:
Adjustment for difference in valuation inputs
95,905
-
113,200
-
95,905
113,200
Units
Units
Number of issued units
99,491
119,262
Unitholders’ funds per issued unit
HRK
963.96
HRK
949.17
EUR
EUR
127.75
126.04
Total assets
Liabilities
Other liabilities
Unitholders’ funds per issued unit (translated in EUR at the
middle rate of the Croatian National Bank at the reporting date)
15
7
Statement of changes in net assets attributable to unitholders’ funds and units
Net assets attributable to unitholders’ funds at the
beginning of the year
Issuance of units during the year
Redemption of units during the year
Net decrease in unitholders’ funds from transactions with
unitholders
Net increase/(decrease) in unitholders’ funds from
Movement in adjustment for difference in valuation inputs
Adjustment for difference in valuation inputs (cumulative
effect)
Total decrease in net assets
Net assets attributable to unitholders’ funds at the end of
the year
2012
HRK’000
2012
Number
of units
2011
HRK’000
2011
Number
of units
113,200
119,262
195,788
195,265
622,833
(645,452)
636,762
(656,533)
394,528
(468,544)
414,911
(490,914)
(22,619)
(19,771)
(74,016)
(76,003)
(8,602)
5,324
-
30
-
(82,588)
(17,295)
95,905
99,491
113,200
119,262
8
Note
Cash flow from operating activities
Interest receipts
Dividend receipts
Investment management fees paid
Custody fees paid
Cash paid for financial instruments
Debt securities
Equity investments
Investment funds
Cash receipts from financial instruments
Debt securities
Equity investments
Investment funds
Cash receipts from placements with banks
Cash paid into placements with banks
Other cash payments
Net cash flows from operating activities
2012
HRK’000
2011
HRK’000
1,912
1,626
(2,222)
(330)
2,160
2,798
(3,197)
(466)
(3,197)
(53,689)
-
(12,375)
(132,983)
(4,905)
8,210
74,518
584
198,635
(198,635)
(376)
17,856
168,722
1,669
221,370
(221,370)
(391)
27,036
38,888
622,833
(640,151)
394,618
(459,512)
(17,318)
(64,894)
370
(2,918)
Net increase/(decrease) in cash and cash equivalents
10,088
(28,924)
Cash and cash equivalents at the beginning of the year
12,368
41,292
22,456
12,368
Cash flow from financing activities
Proceeds from issuance of units
Payments on redemption of units
Net cash flows from financing activities
Effects of foreign exchange differences
Cash and cash equivalents at the end of the year
16
9
Notes to the financial statements
1
Reporting entity
ZB trend – otvoreni investicijski fond s javnom ponudom (“the Fund”) is an open-ended investment fund
established on 10 October 2002. ZB Invest d.o.o. za upravljanje investicijskim fondovima (“the
Management Company”) acts as the management company of the Fund.
The objective of balanced fund ZB trend is the long term increase of the unit value, expressed in EUR,
through investing its assets in globally diversified portfolio of debt and equity securities, and in
investment funds, with targeted portfolio structure of 70% shares, 30% bonds and other interest earning
instruments.
Zagrebačka banka d.d. (“the Custody Bank”) acts as the custodian bank of the Fund.
Croatian Financial Services Supervisory Agency (“the Agency") acts as the regulator of the Fund.
The Members of the Management and Supervisory Board of the Management Company who served
during the year were as follows:
The Management Board of the Management Company
Petar Pierre Matek - President of the Management Board until 31 January 2012;
Hrvoje Krstulović – Member of the Management Board until 31 January 2012, President of the
Management Board from 1 February 2012;
Silvija Tadić – Procurator from 1 February 2012, Member of the Management Board from 16 May 2012;
The Supervisory Board of the Management Company
Jasna Mandac - President of the Supervisory Board;
Krešimir Ćurlin - Vice President of the Supervisory Board;
Vladimir Račić - Member of the Supervisory Board.
Pioneer Investment Management Ltd., 1 George's Quay Plaza, George's Quay, Dublin 2, Ireland is Fund's
investment adviser.
2
Basis of preparation
a) Statement of compliance
The financial statements have been prepared in accordance with International Financial Reporting
Standards (“IFRS”).
These financial statements were authorised for issue by the Management Board of the Management
Company on 22 April 2013.
b) Basis of measurement
These financial statements are prepared on a fair value basis for financial assets and liabilities at fair
value through profit or loss. Other financial assets and liabilities are stated at amortised cost.
c) Use of estimates and judgments
The preparation of financial statements in conformity with IFRS requires management of the
Management Company to make judgments, estimates and assumptions that affect the application of
policies and the reported amounts of assets and liabilities, income and expenses. The estimates and
associated assumptions are based on historical experience and various other factors that are believed to
be reasonable under the certain circumstances and information available at the date of preparation of the
financial statements, the results of which form the basis of making judgments about carrying values of
assets and liabilities that are not readily apparent from other sources. Actual results may differ from the
estimates.
10
Notes to the financial statements (continued)
2
Basis of preparation (continued)
c) Use of estimates and judgments (continued)
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised and any future periods affected.
Information about judgments made by management of the Management Company in the application of
IFRSs that have a significant effect on the financial statements and information about estimates that have
a significant risk of resulting in a material adjustment within the next financial year are included in Note
4.
d) Standards effective after 1 January 2012 that have been early adopted by the Fund
The Fund has elected to adopt International Financial Reporting Standard 13 Fair Value Measurement
(“IFRS 13” or “the Standard”) with effect from 1 January 2012, which is earlier than required by the
Standard (which is effective for annual periods beginning on or after 1 January 2013). Upon adoption of
the Standard, the Fund changed its valuation inputs for financial assets and liabilities to be fully aligned
with the official prices required by the regulator to be used both for the daily pricing of transactions in
the units of the Fund, as well as for annual financial reporting. The adoption of IFRS 13 has not resulted
in any change in the way in which financial assets and liabilities are valued, compared with their
valuation as of 31 December 2011. Consequently the application of IFRS 13 had no effect on the
amounts recognised in the financial statements as of and for the year ended 31 December 2012.
However, although eliminated as of 31 December 2011, during 2011, adjustments to reflect differences
between the valuation of financial assets at closing bid prices, as required by International Financial
Reporting Standards then applicable, and the official prices required by the regulator to be reported by
the Fund, were recognised in the statements of comprehensive income and of changes in net assets
attributable to unitholders for 2011, presented as comparative information in these financial statements
for 2012. As IFRS 13 requires any changes in valuation methodology resulting from its adoption to be
treated as a change in accounting estimate which should therefore be applied prospectively from the date
of adoption of the Standard, without retrospective adjustment of previously reported amounts in
accordance with International Accounting Standard 8 Accounting Policies, Changes in Accounting
Estimates and Errors (“IAS 8”), no restatement of the statement of comprehensive income and of the
statement of changes in net assets attributable to unitholders is required.
e) Functional and presentation currency
These financial statements are presented in Croatian kuna (“HRK”), which is also the functional
currency, rounded to the nearest thousand. The official exchange rate as at 31 December 2012 was HRK
7.545624 to EUR 1 (2011: HRK 7.530420) and HRK 5.726794 to USD 1 (2011: HRK 5.81994).
3
Significant accounting policies
Interest income
Interest income is recognised in profit or loss as accrue, using the effective interest rate of the instrument
calculated at the acquisition date to discount estimated cash flows to net present value over the life of the
underlying contract, or an applicable floating interest rate, except for interest on debt instruments at fair
value through profit or loss, which is accrued at the coupon rate. Interest income includes the
amortisation of any discount or premium and, if applicable, transaction costs or other differences
between the initial carrying amount of an interest earning instrument and, of its amount at maturity,
calculated on an effective interest rate basis.
Coupon interest income on debt instruments at fair value through profit or loss is presented within
Interest income in profit or loss.
Dividend income
Dividend income from investments in foreign equity securities and income from distributions from
foreign investment funds is recognised in profit or loss on the ex-dividend date, net of any irrecoverable
taxes withheld. Dividend income from equity investments in Croatian companies is recognised in profit
or loss on the ex-dividend date without deduction of withholding tax in accordance with currently
applicable legislation.
11
3
Significant accounting policies (continued)
Net gains and losses on financial assets and financial liabilities at fair value through profit or loss
Net gains and losses on financial assets and financial liabilities at fair value through profit or loss include
gains less losses from trading activities arising from changes in the fair value and from disposals of
financial assets and liabilities at fair value through profit or loss, including unrealised foreign currency
differences and derivative instruments, but excluding interest and dividend income. Net gains and losses
on financial assets and financial liabilities at fair value through profit or loss include unrealised and
realised amounts. Gains and losses are realised on the disposal of financial assets at fair value through
profit or loss and are calculated using the weighted average cost method.
Net gains and losses on translation of monetary assets and liabilities
Transactions in foreign currencies are translated at the Croatian National Bank official exchange rate
ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are
translated into Croatian kuna at the official Croatian National Bank foreign currency mid exchange rate
ruling at the Fund’s reporting date. Foreign currency exchange differences arising on translation and
realised gains and losses on disposals or settlements of monetary assets and liabilities are recognised
through profit or loss. Unrealised foreign currency exchange differences arising on translation of foreign
currency financial assets and liabilities at fair value through profit or loss are included in Net gains and
losses on financial assets and liabilities at fair value through profit or loss. All other foreign currency
exchange differences relating to translation of monetary assets and liabilities, including cash and cash
equivalents are presented separately in profit or loss.
Operating expenses
The Fund’s operating expenses for the period include investment management fees, custody fees and
other expenses. Included in other operating expenses are brokerage expenses, transaction service costs,
audit expenses and fees payable to the Agency, which are recognised in profit or loss as they accrue.
Financial instruments
Classification
The Management Company classifies Fund’s financial assets and liabilities in the following categories: at
fair value through profit or loss, loans and receivables, and other financial liabilities. The Management
Company determines the classification of investments at initial recognition.
Financial assets and financial liabilities at fair value through profit or loss
This category comprises: financial instruments held for trading (including derivatives), and those
instruments designated by the management as at fair value through profit or loss at inception. The
Management Company designates financial assets and liabilities at fair value through profit or loss when:
•
•
•
the assets and liabilities are managed, evaluated and reported internally on a fair value basis,
the designation eliminates or significantly reduces an accounting mismatch which would otherwise
arise, or
the asset or liability contains an embedded derivative that significantly modifies the cash flows that
would otherwise be required under the contract.
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are
not quoted in an active market. These include short-term receivables and deposits with banks.
Other financial liabilities
Financial liabilities not classified as fair value through profit or loss include liabilities for unsettled
purchased securities, financial liabilities arising on unitholders’ funds and other liabilities.
12
3
Financial instruments (continued)
Recognition
Loans and receivables and financial liabilities that are carried at amortised cost are recognised when
advanced to borrowers or received from lenders. Other financial assets and financial liabilities (including
assets and liabilities classified at fair value through profit or loss) are initially recognised on the trade
date at which the Fund becomes a party to the contractual provisions of the instrument. From this date
any gains and losses arising from changes in the fair value of the financial assets or financial liabilities
are recorded.
Measurement
Financial instruments are measured initially at fair value plus, in the case of a financial asset or financial
liability not at fair value through profit or loss, transaction costs that are directly attributable to the
acquisition or issue of the financial asset or financial liability. Translations costs on financial assets and
financial liabilities at fair value through profit or loss are expensed immediately, while on other financial
assets and liabilities they are amortised.
Subsequent to initial recognition, financial assets and financial liabilities classified at fair value through
profit or loss are measured at fair value with changes in their fair value recognised in profit or loss.
Financial assets classified as loans and receivables are carried at amortised cost using the effective
interest rate method, less impairment losses, if any. Premiums and discounts are included in the carrying
amount of the related asset and amortised based on the effective interest rate.
Other financial liabilities are measured at amortised cost using the effective interest rate. Financial
liabilities arising from the redeemable units issued by the Fund are carried at the redemption amount
representing the investors’ right to a residual interest in the Fund’s assets.
Fair value measurement principles
The fair value of financial instruments is based on prices officially approved by the Agency at the
reporting date without any deduction for estimated future costs to sell. Prior to 1 January 2012, the
Management Company measured the fair value of the Fund’s quoted financial assets using the closing
bid prices on the valuation day. In 2012, upon adoption of IFRS 13, financial assets are valued using
officially approved prices. Detailed guidance has been issued by the regulator for various categories of
asset, which is intended to provide the most appropriate measure of fair value taking into consideration
how the securities are traded. This includes the use of closing mid-market prices for securities traded in
deep and active foreign markets, and the use of the weighted average price for the last traded day for
securities traded on certain other markets.
Investments in investment funds are priced at net assets value per unit, as reported by the management
companies of such funds. The Agency requires the Management Company to calculate the price of unit
in the Fund based on the measurement of the Fund’s financial assets at officially approved prices. The
Management Company is obliged to arrange the issue and redemption of units at this price of unit. The
officially approved prices of the Fund’s financial assets may differ from the closing bid market prices.
If an officially approved price is not available on a recognised stock exchange or from a broker/dealer for
non-exchange traded financial instruments, the fair value of the instrument is estimated using valuation
techniques, including use of recent arm’s length market transactions, reference to the current fair value of
another instrument that is substantially the same, discounted cash flow techniques, or any other valuation
technique that provides a reliable estimate of prices obtained in actual market transactions.
Where discounted cash flow techniques are used, estimated future cash flows are based on management’s
best estimates and the discount rate used is a market rate at the reporting date applicable for an
instrument with similar terms and conditions. Where other pricing models are used, inputs are based on
market data at the reporting date.
The fair value of non-exchange-traded derivatives is estimated at the amount that the Fund would receive
or pay to terminate the contract on the reporting date taking into account current market conditions and
the current creditworthiness of the counterparties.
13
3
Gains and losses on subsequent measurement
Gains and losses arising from a change in the fair value of financial instruments at fair value through
profit or loss are recognised in profit or loss.
Impairment of financial assets
Financial assets that are stated at cost or amortised cost are reviewed at reporting date to determine
whether there is objective evidence of impairment. If any such indication exists, an impairment loss is
recognised in profit or loss as the difference between the asset’s carrying amount and the present value of
estimated future cash flows discounted at the financial asset’s original effective interest rate. Short term
balances are not discounted.
If in a subsequent period the amount of an impairment loss recognised on a financial asset carried at
amortised cost decreases and the decrease can be linked objectively to an event occurring after the
decrease, the decrease is reversed through profit or loss.
Derecognition
The Fund derecognises a financial asset when the contractual rights to the cash flows for the financial
asset expire or it transfers the financial asset and the transfer qualifies for derecognition in accordance
with IAS 39 Financial Instruments: Recognition and Measurement (“IAS 39”).
The Fund uses the weighted average method to determine realised gains and losses on derecognition.
A financial liability is derecognised when the obligation specified in the contract is discharged, cancelled
or has expired.
Offsetting of financial instruments
Financial assets and liabilities are offset and the net amount reported in the statement of financial
position when there is a legally enforceable right to offset the recognised amounts and there is an
intention to settle on a net basis, or realise the asset and settle the liability simultaneously.
Income and expenses are presented on a net basis only when permitted by the accounting standards,
including gains and losses arising from a group of similar transactions, i.e. trading activities of the Fund.
Specific instruments
Cash and cash equivalents
Cash and cash equivalents comprise giro accounts and placements with banks with original maturity up
to three months. Cash and cash equivalents are short term, highly liquid investments that are readily
convertible into known amounts of cash, and are subject to an insignificant risk of changes in value, and
are held for the purpose of meeting short term cash commitments rather than for investment or other
purposes.
Derivative financial instruments
The Fund uses derivative financial instruments in order to optimally hedge the exposure to currency risk
which arises from operating, financing and investing activities. The Fund holds or issues derivative
financial instruments as an economic hedge to hedge the exposure to risks or for achieving the
investment goals of the Fund by increasing the return of the Fund. The investment strategy does not
change as a result of investing in financial derivatives, nor will such investments raise the risk exposure
above that defined by the Fund’s Prospectus and Statute, as well as by the Act. All derivative financial
instruments are classified as financial instruments held for trading.
Derivative financial instruments include foreign currency forward agreements and swaps denominated in
foreign currencies. Initially, they are recognised in the statement of financial position on trade date and
are subsequently measured at fair value. Fair values are determined using discounted cash flows models.
Derivatives are classified as financial assets at fair value through profit or loss if their fair value is
positive and as financial liabilities at fair value through profit or loss if their fair value is negative.
14
3
Specific instruments (continued)
Equity securities
Equity securities are classified as financial assets at fair value through profit or loss (financial
instruments held for trading) and are carried at fair value, unless there is no reliable measure of the fair
value, in which case equity securities are stated at cost, less impairment.
Debt securities
Debt securities are classified as financial assets at fair value through profit or loss (financial instruments
held for trading) and are carried at fair value. Debt securities include domestic corporate and government
bonds and foreign corporate bonds.
Loans and receivables include short-term placements with banks and government debt securities of Fond
za naknadu oduzete imovine, and are carried at amortised cost less any impairment losses in order to
reflect the estimated recoverable amounts.
Investments in funds
Investments in open and closed ended funds are classified as financial assets at fair value through profit
or loss and are carried at fair value.
Taxation
In accordance with currently applicable Croatian tax legislation, the profit of the Fund is not subject to
income tax.
Redeemable units
All units issued by the Fund are redeemable units which provide the investors with the right to require
redemption for cash at the value proportionate to the investor’s share in the Fund’s net assets at the
redemption date. In accordance with amendment of IAS 32 Financial Instruments: Presentation (“IAS
32”), redeemable units are classified as equity instruments.
Distribution of the Fund’s results
In accordance with the provisions of the Prospectus, profit is not distributed to unitholders but is
reinvested in the Fund.
Standards, interpretations and amendments to published standards that are not yet effective
Several new and altered Standards and Interpretations issued by the International Accounting Standards
Board and its International Financial Reporting Interpretations Committee, have been authorised for issue
but are not yet applicable to entities reporting under IFRS for period ended 31 December 2012, and have
not been applied in preparation of these financial statements. Most new and altered Standards and
Interpretations are not relevant to the Fund and will not affect the financial statements, except for as
follows:
IFRS 9 Financial Instruments (“IFRS”) (a complete version of this standard has not yet been adopted and
the IASB has an active project to make limited amendments to the classification and measurement
requirements and add new requirements to address the impairment of financial assets and hedge
accounting), that replaces IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 is
mandatory for annual periods beginning on or after 1 January 2015, early adoption is permitted. The
Standard introduces significant changes with respect to the classification and measurement of financial
assets. The Fund’s Management Company has not yet decided on the date of the initial application of
IFRS 9 nor has it fully analysed the effects of its application.
15
3
Segment reporting
An operating segment is a component of the Fund that engages in business activities from which it may
earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of
the Fund’s other components. All operating segments’ operating results are reviewed regularly by the
Management Board of the Management Company to assess its performance.
Segment results that are reported to the Management Board of the Management Company include items
directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated
items comprise mainly investment management fees, custody fees and other operating expenses, giro
accounts with banks, derivative financial instruments, other asset and liabilities, if they can’t be allocated
on a particular segment.
Comparative financial information
In order to achieve consistency with disclosures in the reporting period, certain changes to comparative
financial information were made, as explained below:
Accrued interest on debt securities at fair value through profit or loss in the amount of HRK 446
thousand as at 31 December 2011 was transferred from Other assets to Financial assets at fair value
through profit or loss.
4
Accounting estimates and judgments
Note Accounting estimates and judgments complements note on financial risk management (Note 19).
Estimates and judgments that carry significant risk of possible material reconciliations of the carrying
amounts of the assets and liabilities within the next financial year are discussed below.
The main sources of uncertainty associated with estimates
Determination of the fair value
Determination of the fair value of financial assets and liabilities, for which market price is not available,
requires the use of valuation methods described in Note 3: Fair value measurement principles. For
financial instruments that are rarely traded and have non transparent price, the fair value is less objective
and requires a different degree of judgment depending on liquidity, concentration, uncertainty of market
factors, pricing assumptions and other risks affecting the individual instrument.
Impairment losses on loans and receivables
The need for impairment of assets carried at amortised cost is estimated as described in Note 3:
Impairment of financial assets. Impairment of individual exposure is based on management's best
estimate of the present value of expected future cash flows. In evaluating these cash flows, management
assesses the debtor's financial position and net recoverable value of collateral.
The main accounting judgments when applying accounting policies
Classification of financial assets and financial liabilities
Accounting policies are the framework by which the Fund’s assets and liabilities are initially allocated in
different accounting categories. When financial assets and liabilities are classified as "held for trading",
the Management Company determines whether it satisfy the definition of assets and liabilities held for
trading, as specified in Note 3: Financial assets and financial liabilities at fair value through profit or
loss. In the allocation of financial assets and financial liabilities at fair value through profit or loss, the
Management Company determined that such financial assets and liabilities must meet one of the criteria
for such classification as specified in Note 3. Reclassification of financial assets and financial liabilities
at fair value through profit or loss is permitted only in extremely rare circumstances. Investments held to
maturity may be classified in this group only if the Management Company has the intention and ability to
hold these investments till maturity.
16
4
Accounting estimates and judgments (continued)
The main accounting judgments when applying accounting policies (continued)
Fair value of financial instruments
Most of the Fund’s financial instruments are measured at fair value in the statement of financial position
and it is usually possible to determine their fair value within a reasonable range of estimate.
For most of the Fund’s financial instruments that are traded on organised markets and measured at fair
value, quoted market prices are readily available. However, the fair value of certain financial
instruments, for example, over-the-counter derivatives, unquoted securities or not actively traded, is
estimated using valuation techniques, including discounted cash flow method and reference to the current
fair values of other instruments that are substantially the same (subject to the appropriate adjustments).
Alternative methods and valuation techniques are explained in Note 3: Fair value measurement
principles.
Fair value estimates are made at a specific point in time, based on market conditions and information
about the financial instrument. Valuation techniques are based on certain commercial and financial
assumptions and estimates which by nature are subjective and involve uncertainties and matters that
significantly depend on judgments, such as interest rates, volatility and estimated cash flows, and
therefore cannot be determined with complete accuracy. The Fund measures fair value based on fair
value hierarchy described in Note 19: Fair value.
At the reporting date, the Fund had no financial instruments whose fair value was determined using
valuation techniques.
The Fund measures quoted financial assets using officially approved prices; this includes the
measurement of certain equity and debt securities at their weighted average prices. In the opinion of the
Management Company, this is in accordance with the pricing conventions used by market participants
(as well as those required by the regulator) and represents a practical expedient for fair value
measurement, in accordance with IFRS 13, which has been adopted early.
5
Interest income
Debt securities at fair value through profit or loss
Placements with banks
Debt securities classified as loans and receivables
6
2012
HRK’000
2011
HRK’000
23
1,401
39
124
23
1,831
89
159
1,587
2,102
Dividend income
2012
HRK’000
Equity securities – companies in Republic of Croatia
Equity securities – foreign companies
Investment funds
2011
HRK’000
1,556
48
103
2,605
50
1,604
2,758
In the 2012 the gross dividend income before taxes amounted to HRK 2,001 thousand (2011: HRK 3,271
thousand), and withholding tax amounted to HRK 397 thousand (2011: HRK 513 thousand) or 19.83%
(2011: 15.68%).
17
7
Net gains/(losses) on financial assets and financial liabilities at fair value through profit or loss
The Fund operates and invests in domestic and foreign markets. Net gains and losses on financial assets
and financial liabilities at fair value through profit or loss include unrealised and realised amounts and
effect of changes in unrealised foreign currency exchange rates. Gains and losses are realised on the
disposal of financial assets at fair value through profit or loss, and are calculated using the weighted
average cost method. Realised gains and losses represent the difference between the selling price and the
weighted average cost of financial instruments bought and sold in the year, and between the selling price
and fair value of financial instruments at the beginning of the year in respect of those financial
instruments in existence at the start of the year and subsequently sold during the year. Unrealised gains
and losses represent the difference between the purchase price and the fair value of financial instruments
at the year end in respect of financial instruments purchased during the year and the change in fair value
of financial instruments in existence at the current and previous year end.
2012
Net realised
gain/(loss)
HRK’000
Net unrealised
gain/(loss)
HRK’000
Total
HRK’000
Debt securities
Investment funds
Equity securities
389
94
3,730
1,817
(62)
181
2,206
32
3,911
Total effect of changes at officially approved prices
4,213
1,936
6,149
Effect of unrealised foreign currency exchange
rates
(1,686)
4,463
2011
Net realised
gain/(loss)
HRK’000
Net unrealised
gain/(loss)
HRK’000
Total
HRK’000
Debt securities
Investment funds
Equity securities
(222)
(10)
(5,876)
(1,672)
(1,087)
(5,147)
(1,894)
(1,097)
(11,023)
Total effect of changes at officially approved prices
(6,108)
(7,906)
(14,014)
Effect of unrealised foreign currency exchange
rates
Movement in adjustment for difference in valuation
inputs
7,361
30
(6,623)
18
8
The Management Company receives an investment management fee of 2.00% (2011: 2.00%) per annum
of the total daily assets attributable to unitholders’ funds decreased by the amount of financial liabilities
and investments in the other fund under the Management Company’s management. The fee is accrued
daily and payable monthly.
9
Custody fees
The Custodian bank receives a fee of 0.30% (2011: 0.30%) per annum of the total daily assets
attributable to the unitholders’ funds decreased by the amount of financial liabilities and investments in
the other fund under the Management Company’s management. The fee is accrued daily and payable
monthly.
10
2012
HRK’000
Brokerage expenses
Audit expenses
Fees payable to the Agency
Transaction services costs
Other expenses
2011
HRK’000
84
38
33
22
1
196
43
20
56
2
178
317
Marketing expenses and other expenses incurred in the total amount of HRK 1 thousand (2011: HRK 9
thousand) are borne by the Management Company on behalf of the Fund.
The Agency received a fee of 0.03% per annum of the daily total assets attributable to the unitholders’
funds. The fee was accrued daily throughout the entire 2012 (2011: from 1 July 2011 until 31 December
2011) and payable monthly.
11
Giro accounts with the Custody bank:
- denominated in Croatian kuna
- denominated in EUR
- denominated in US dollar
- denominated in British pound
- denominated in Swiss franc
- denominated in Swedish krona
- denominated in Canadian dollar
- denominated in Hong Kong dollar
- denominated in Singapore dollar
- denominated in Japanese yen
- denominated in Australian dollar
- denominated in Norwegian krone
31 December
2012
HRK’000
31 December
2011
HRK’000
17,279
407
2,814
1,779
115
7
24
6
8
2
15
-
8,619
717
49
3
114
6
10
8
126
54
42
22,456
9,748
19
12
31 December
2012
HRK’000
31 December
2011
HRK’000
661
9,156
6,618
636
11,210
7,121
16,435
121
18,967
446
16,556
19,413
2,403
3,006
Equity securities
-Foreign companies
67,576
86,091
Total
86,535
108,510
Financial instruments held for trading
Debt securities
-Domestic sovereign bonds
-Domestic corporate bonds
-Foreign corporate bonds
- Accrued interest on debt securities
Foreign investment funds
During 2012, the Fund invested in the fund ETF BRAZIL (2011: ETF BRAZIL) managed by Barclays
Global Fund Advisors, a management fee amounted to 0.59% (2011: 0.59%).
13
Placements with banks – short-term
- denominated in USD
Debt securities
- government bonds
14
31 December
2012
HRK'000
31 December
2011
HRK'000
-
2,620
1,363
1,494
1,363
4,114
31 December
2012
HRK’000
31 December
2011
HRK’000
23
86
23
108
109
131
Other assets
Accrued interest on:
- giro accounts with banks
Receivables for dividends
20
15
Other liabilities
Liabilities for investment management fees
Liabilities for redemption fees
Liabilities for custody fees
Liabilities due to unitholders for redemption of units
Liabilities for audit fees
Liabilities due to the Agency
16
31 December
2012
HRK’000
31 December
2011
HRK’000
172
2
1
14,343
37
3
201
12
2
9,042
43
3
14,558
9,303
Cash and cash equivalents for the purpose of preparation of Statement of cash flows comprise:
Notes
Giro accounts with the Custody bank
Placements with banks with original maturity up to
three months
11
13
31 December
2012
HRK’000
31 December
2011
HRK’000
22,456
9,748
-
2,620
22,456
12,368
21
17
Financial instruments and associated risks
In accordance with its management strategy, the Fund maintains position in different derivative and nonderivative financial instruments. The Fund’s portfolio comprises of quoted debt securities, equity
securities, investment funds and placements with banks.
The Fund’s investment activities expose the Fund to different risks related to financial instruments and
markets in which it invests. The most significant financial risks to which the Fund is exposed are market
risk, credit risk and liquidity risk.
The assets structure and associated risks are determined and monitored by the Management Company, in
order to achieve the Fund’s investment objectives.
Market risk
Market risk embodies the potential for both loss and gains on financial instruments and includes currency
risk, interest rate risk and price risk.
The Fund’s investment strategy is to achieve high rates of return over the long term by investing the
assets of the Fund in Croatian and foreign equity markets and debt securities markets. The Management
Company achieves these goals by investing into the following financial assets:
−
bonds and other interest bearing financial instruments with issuers from the Republic of Croatia, EU
and OECD member states, up to 30% of Fund assets,
−
bonds and other interest bearing financial instruments with issuers listed below under *, up to 10%
of Fund assets,
−
equity securities and equity securities rights with issuers from the Republic of Croatia, EU and
OECD member states, without restrictions,
−
equity securities and equity securities rights with issuers listed below under *, up to 25% of Funds
assets,
−
investment funds which invest mostly into instruments mentioned above, up to 30% of Fund assets,
−
term deposits at authorised banks up to 30% of Fund assets, but maximum 20% of Fund net assets
can be invested at one bank,
−
term agreements, options and other financial derivatives.
*Albania, Argentina, Bahrain, Bangladesh, Bosnia and Herzegovina, Brazil, Montenegro, Chile, Egypt,
Philippines, Hong Kong, India, Indonesia, Israel, Jordan, SAR, Qatar, Kazakhstan, China, Columbia,
Kuwait, Lebanon, Macedonia, Malaysia, Morocco, Moldavia, Oman, Pakistan, Peru, Russian
Federation, Saudi Arabia, Singapore, Syrian Arab Republic, Serbia, Sri Lanka, Thailand, Taiwan,
Tunis, United Arab Emirates, Ukraine, Venezuela and Vietnam.
It's allowed to invest more than 35% of Fund net assets into securities and money market instruments
which are issued by the Republic of Croatia, any of the EU member states, European Bank for Research
and Development (“EBRD”), International Bank for Research and Development (“IBRD”) or European
Investment Bank (“EIB”).
Assets of the Fund are invested in debt securities and equity instruments so as to achieve the targeted
percentage of debt securities in investment portfolio structure of 30%, and targeted percentage of equity
securities of 70%. The Management Company aims to achieve higher return by allocating funds in those
types of securities and on those markets, which it estimates will give the highest return in the future. The
Management Company manages risks on daily basis, in accordance with established policies and
procedures. Details on the Fund’s investment portfolio are stated in the portfolio of investment.
The nature and extent of the financial instruments at the reporting date and the risk management policies
employed by the Fund are discussed below.
22
17
Financial instruments and associated risks (continued)
Currency risk
The Fund may invest in financial instruments and enter into transactions denominated in currencies other
than its functional currency. Consequently, the Fund is exposed to risk that the exchange rate of its
currency relative to other foreign currencies may change in a manner that has an adverse affect on the
income and value of the Fund.
The Fund’s total net exposure to fluctuations in foreign currency exchange rates at reporting date was as
follows:
31 December
2012
HRK'000
31 December
2012
%
31 December
2011
HRK'000
31 December
2011
%
25,503
17,300
43,742
8,299
115
5,722
1,077
8
8,675
15
1
6
26.59
18.04
45.61
8.65
0.12
5.97
1.12
0.01
9.04
0.02
0.00
0.01
23,118
10,695
56,456
7,614
114
6,346
2,715
8
13,874
1,515
42
6
20.42
9.45
49.87
6.72
0.10
5.60
2.40
0.01
12.26
1.34
0.04
0.01
Total assets
110,463
115.18
122,503
108.22
Liabilities (excluding net assets
attributable to unitholders’ funds)
Croatian kuna
(14,558)
(15.18)
(9,303)
(8.22)
(14,558)
(15.18)
(9,303)
(8.22)
95,905
100.00
113,200
100.00
Assets
EUR
Croatian kuna
US dollar
British pound
Swiss franc
Canadian dollar
Hong Kong dollar
Singapore dollar
Japanese yen
Australian dollar
Norwegian krone
Swedish krone
Redeemable units in net assets
attributable to unitholders’ funds
23
17
Currency sensitivity
The following table is a breakdown of the Fund’s currency sensitivity in a manner that it shows the
sensitivity of the Fund’s portfolio to exchange rate fluctuations at the reporting date (in the table are
offered three levels of hypothetical changes: 1%, 5% and 10%), and how the change would affect the
increase or decrease of the Fund’s net asset value, under the assumption that other variables remain
unchanged.
31 December 2012
Currency
Croatian kuna
US dollar
British pound
Swiss franc
Canadian dollar
Hong Kong dollar
Singapore dollar
Japanese yen
Australian dollar
Norwegian krone
Swedish krone
31 December 2011
Currency
Croatian kuna
US dollar
Japanese yen
British pound
Swiss franc
Canadian dollar
Hong Kong dollar
Singapore dollar
Australian dollar
Norwegian krone
Swedish krone
Net asset
value
% in net
asset
HRK'000
2,742
43,742
8,299
115
5,722
1,077
8
8,675
15
1
6
Net asset
value
HRK'000
1,392
56,456
13,874
7,614
114
6,346
2,715
8
1,515
42
6
%
2.86
45.61
8.65
0.12
5.97
1.12
0.01
9.04
0.02
0.00
0.01
% in net
asset
%
1.23
49.87
12.26
6.72
0.10
5.60
2.40
0.01
1.34
0.04
0.01
(+/-) %
(+/-) HRK'000
1%
0.03%
0.46%
0.09%
0.00%
0.06%
0.01%
0.00%
0.09%
0.00%
0.00%
0.00%
5%
0.14%
2.28%
0.43%
0.01%
0.30%
0.06%
0.00%
0.45%
0.00%
0.00%
0.00%
10%
0.29%
4.56%
0.87%
0.01%
0.60%
0.11%
0.00%
0.90%
0.00%
0.00%
0.00%
1%
27
437
83
1
57
11
87
-
5%
137
2,187
415
6
286
54
434
1
-
10%
274
4,374
830
12
572
108
1
868
2
1
1%
0.01%
0.50%
0.12%
0.07%
0.00%
0.06%
0.02%
0.00%
0.01%
0.00%
0.00%
(+/-) %
5%
0.06%
2.49%
0.61%
0.34%
0.01%
0.28%
0.12%
0.00%
0.07%
0.00%
0.00%
10%
0.12%
4.99%
1.23%
0.67%
0.01%
0.56%
0.24%
0.00%
0.13%
0.00%
0.00%
(+/-) HRK'000
1%
5%
10%
14
70
139
565
2,823
5,646
139
694
1,387
76
381
761
1
6
11
63
317
635
27
136
272
1
15
76
152
2
4
1
Interest rate risk
The majority of Fund’s investments comprise of equity instruments. Consequently, the Fund is not
significantly exposed to the risk of interest earning financial assets and interest-bearing financial
liabilities maturing or repricing at different times or in different amounts. However, the Fund is exposed
to fair value interest rate risk, that is, the risk of fluctuations in the prevailing levels of market interest
rates.
At the reporting date, the Fund invested in debt securities bearing fixed interest rates in the total amount
of HRK 17,799 thousand (2011: HRK 20,461 thousand), of which HRK 16,435 thousand (2011: HRK
18,967 thousand) relates to investments classified at fair value through profit or loss, and the interest rate
risk is minimised and reflected through fair value.
Up to the reporting date the Fund assessed that there is no need to enter into any hedging activity with
respect to its interest rate risks.
At the reporting date, duration of all debt securities portfolio is 3.40 (2011: 3.46), which means that if
interest rates increase by 1 percentage point (the same increase in interest rates for all maturities), then
the fair value of debt securities would decrease by approximately 3.40% (2011: 3.46%). Since the value
of the portfolio’s assets at 31 December 2012 amounted to HRK 17,799 thousand (2011: HRK 20,461
thousand), the decrease in net asset value would amount to HRK 605 thousand (2011: HRK 708
thousand).
At the reporting date weighted average time to maturity date or contracted price changes of debt
securities or placements with banks, depending on which is earlier, was 1,431.69 days (2011: 1,312.81
days).
Price risk
Price risk is the risk that the value of the financial instrument will fluctuate as a result of changes in
market prices, whether caused by factors specific to an individual investment, its issuer or all factors
affecting all instruments traded in the market.
24
17
Price risk (continued)
The following table shows the concentration of the Fund’s assets by industries at the reporting date:
31 December
2012
HRK’000
2,025
31 December
2012
%
1.83
31 December
2011
HRK’000
2,131
31 December
2011
%
1.74
9,156
-
8.29
-
9,211
1,999
7.52
1.63
2,341
746
1,173
915
3,234
1,493
632
8,557
2,403
5,251
1,188
1,202
6,618
2,934
569
1,884
569
705
818
2,121
972
1,524
4,324
3,516
1,368
1,754
1,631
1,028
3,466
1,569
2,113
4,725
3,253
2.12
0.67
1.06
0.83
2.93
1.35
0.57
7.75
2.18
4.75
1.08
1.09
5.99
2.66
0.51
1.71
0.51
0.64
0.74
1.92
0.88
1.38
3.91
3.18
1.24
1.59
1.48
0.93
3.14
1.42
1.91
4.28
2.94
1,463
3,618
4,378
1,700
1,038
656
6,964
1,422
6,597
3,006
2,389
635
7,120
4,431
2,304
4,316
2,127
3,101
1,139
370
2,548
3,160
1,493
2,756
1,872
2,478
1,197
1,290
1,677
5,537
7,626
3,788
2,021
1.19
2.95
3.57
1.39
0.85
0.54
5.68
1.16
5.39
2.45
1.95
0.52
5.81
3.62
1.88
3.52
1.74
2.53
0.93
0.30
2.08
2.58
1.22
2.25
1.53
2.02
0.98
1.05
1.37
4.52
6.23
3.09
1.65
Total concentration of the Fund's assets by industries
87,777
79.46
109,558
89.43
Other assets
22,456
230
20.33
0.21
9,748
2,620
577
7.96
2.14
0.47
110,463
100.00
122,503
100.00
Concentration of Fund's assets by industries
Domestic sovereign risk
Domestic corporate risk by industries
Packaged food and meat
Pharmaceuticals
Foreign corporate risk by industry
Application programs
Oil & gas drilling
Distributors
Health products distributors
Diversified banks
Diversified activities with real estates
Diversified financial services
Tobacco and tobacco products
Electrical installations
Electrical parts and equipment
Pharmaceuticals
Funds
Building and engineering
Construction works and home repairs
Construction products
Hypermarkets and shopping centers
Integrated oil and gas industry
Integrated telecommunication services
Internet programs and services
Oil and gas research and production
Cable and satellite TV
Casinos and games of chance
Food retail
Drug retail
Computer and electronic goods retail
Equipment and services for oil and gas industries
Electricity supply
Gas supply
Precious metals and minerals
Real estate business
Consumer goods stores
Car manufacturers
Computer equipment (hardware)
Oil & gas refining and production
Regional banks
Residential mortgage unions and mortgage financing
Coal and consumable fuels
Storage devices and peripherals
Extraction of various metals and ores
Multipurpose insurance
Water supply
Health technology
Health services
Gold
Life and health insurance
Total Fund's assets by industries
25
17
Price risk (continued)
As the majority of the Fund’s financial instruments are carried at fair value with fair value changes
recognised in the statement of comprehensive income, all changes in market conditions will directly
affect Net gains and losses on financial assets and liabilities at fair value through profit or loss.
Price risk is mitigated by the Management Company by constructing a diversified portfolio of
instruments on various markets.
“Value at risk” with confidence level of 95% and time interval of one day is 0.79 or HRK 758 thousand
(2011: 1.91 or HRK 2,162 thousand), which means that, based on historical data, there is 95%
probability that Fund’s net asset value will not fall by more than 0.79% or HRK 758 thousand (2011:
1.91% or 2,162 thousand) in one day. “Value at risk” analysis included all Fund’s net asset value.
Credit risk
Credit risk is the risk that the counterparty to a financial instrument will fail to discharge an obligation or
commitment that it has entered into with the Fund, completely or partially at the maturity date.
Counterparties’ failure to discharge obligations toward the Fund would decrease the value of its assets.
The Fund’s credit exposure at the reporting date from financial instruments held for trading purposes is
represented by the fair value of instruments with a positive fair value at the reporting date, as recorded on
the statement of financial position.
The risk that counterparties to derivative or other trading instruments might default on their obligation is
monitored on an ongoing basis. In monitoring credit risk exposure, consideration is given to trading
instruments with positive fair value. To manage the level of credit risk, the Fund analyses credit
worthiness of counterparties.
At 31 December 2012, the following financial assets were exposed to credit risk: giro accounts with
banks, investments in debt securities and other receivables.
Credit risk arising from debt instruments relates mainly to domestic corporate securities. Further credit
risk arises from debt instruments issued by the Republic of Croatia and foreign corporate securities.
The Fund’s financial assets exposed to credit risk were concentrated in the following areas and present
the maximum accounting loss that would be recognised at the reporting date if counterparties failed
completely to perform as contracted:
31
31
Financial instruments with credit risk
31
31
December December
December December
2011
2011
2012
2012
HRK’000
%
HRK’000
%
Domestic sovereign risk
- Republic of Croatia
2,131
1.74
2,025
1.83
Domestic corporate risk analysed by industry
- Packaged food and meat
9,211
7.52
9,156
8.29
- Pharmaceuticals
1,999
1.63
- Banking
12,368
10.10
22,456
20.33
Foreign corporate risk by industry
- Integrated oil and gas industry
7,120
5.81
6,617
5.99
Accrued interest
469
0.38
144
0.13
Other receivables
108
0.09
86
0.08
Total financial assets with credit risk
40,484
36.65
33,406
27.27
Other investments
69,979
63.35
89,097
72.73
110,463
100.00
122,503
100.00
Total assets
At 31 December 2012 and 2011 the Fund had no financial asset carried at amortised cost, which is due or
which was impaired.
26
17
Credit risk (continued)
Credit ratings of Fund’s investment portfolio by Standard & Poor's ratings are as follows:
Rating
31
December
2012
HRK'000
31
December
2012
%
31
December
2011
HRK'000
31
December
2011
%
No rating
22,456
20.33
9,748
7.96
No rating
-
-
2,620
2.14
Debt securities
B
BB+
BBB
BBBNo rating
9,156
2,025
6,617
-
8.29
1.83
5.99
-
9,211
7,120
2,131
1,999
7.52
5.81
1.74
1.63
Interest receivables
Other receivables
Other investments
No rating
No rating
No rating
144
86
69,979
0.13
0.08
63.35
469
108
89,097
0.38
0.09
72.73
110,463
100.00
122,503
100.00
Total assets
Liquidity risk
The structure of the fund’s assets enables daily creation and retreatment of units and is therefore exposed
to liquidity risk in case of refunds to owners of the Fund at any time.
Liquidity risk arises in the general funding of the Fund's activities and in the management of positions. It
includes the risk of being unable to liquidate an asset at a reasonable price and in an appropriate time
frame.
As a result, the Fund may not be able to liquidate quickly some of its investments in these instruments at
an amount close to their fair value in order to meet its liquidity requirements, or to respond to specific
events such as deterioration in the creditworthiness of any particular issuer.
Financial instruments comprise of low risk government bonds issued by Republic of Croatia, domestic
and foreign corporate debt securities and foreign equity securities. Such securities can be easily sold
either directly or through repurchase agreements in order to meet liquidity needs.
Specific instruments risk
The Fund enters into forward currency contracts to hedge economically the overall portfolio currency
risk and to settle foreign currency transactions. Forward currency contracts are commitments between
two parties either to exchange different currencies at a specified future date for a specified price.
Forward currency contracts result in exposure to market risk based on changes in foreign currency
exchange rates relative to contracted amounts. Market risk arises due to the possible movement in foreign
exchange rates. Forward contracts result in credit exposure to the counterparty.
27
17
Specific instruments risk (continued)
Notional amounts are the underlying reference amounts of foreign currencies upon which the fair values
of forward currency contracts entered into by the Fund are based. While notional amounts do not
represent the current fair value and are not necessarily indicative of the future cash flows of the Fund’s
forward currency contracts, the underlying price changes in relation to the variables specified by the
notional amounts affect the fair value of these derivative financial instruments.
Operational risk
Operational risk means the risk of direct or indirect damages resulting from errors, injuries, disruption or
damage caused by internal processes, technologies and infrastructure that supports the Fund’s operations
or externally induced events. Operational risk includes legal and compliance risk, while it excludes
credit, market and liquidity risk.
In the process of managing operational risk, The Management Company has adopted a Risk management
policy, which in part regulates the operational risk management, then the Regulations on the operational
risk management, and Procedure for analysing and monitoring risk parameters.
18
Segment reporting
The following table shows the structure of statement of comprehensive income and net assets attributable
to unitholders’ funds for each reportable segment:
Equity
securities
HRK’000
Debt
securities
and loans
and
receivables
HRK’000
Investment
funds
HRK’000
Unallocated
HRK’000
Total
HRK’000
1,556
3,730
181
1,564
389
1,817
48
94
(62)
23
-
1,587
1,604
4,213
1,936
(1,677)
31
(40)
-
(1,686)
581
95
(12)
(294)
370
4,371
3,896
28
(271)
8,024
Custody fees
(84)
-
-
(2,193)
(329)
(94)
(2,193)
(329)
(178)
Operating expenses
(84)
-
-
(2,616)
(2,700)
Net increase/(decrease) in unitholders’
funds from investment activities
4,287
3,896
28
(2,887)
5,324
Net assets attributable to unitholders’
fund by reporting segments at 31
December 2012
67,659
17,919
2,406
7,921
95,905
2012
Interest income
Dividend income
Net realised gain
Net unrealised gain/(loss)
Effect of unrealised foreign currency
exchange rates on securities
Net gains/(losses) on translation of
monetary assets and liabilities
28
18
Segment reporting (continued)
Equity
securities
HRK’000
Debt
securities
and loans
and
receivables
HRK’000
Investment
funds
HRK’000
Unallocated
HRK’000
Total
HRK’000
Interest income
Dividend income
Net realised loss
2,708
(5,876)
2,079
(222)
50
(10)
23
-
2,102
2,758
(6,108)
Net unrealised loss
Effect of unrealised foreign currency
exchange rates on securities
Net gains/(losses) on translation of
monetary assets and liabilities
(5,117)
(1,672)
(1,087)
-
(7,876)
6,914
366
81
-
7,361
(3,204)
18
125
143
(2,918)
Net investment (loss)/income
(4,575)
569
(841)
166
(4,681)
Custody fees
(196)
-
-
(3,108)
(466)
(121)
(3,108)
(466)
(317)
Operating expenses
(196)
-
-
(3,695)
(3,891)
Net increase/(decrease) in unitholders’
funds from investment activities
(4,771)
569
(841)
(3,529)
(8,572)
Net assets attributable to unitholders’
fund by reporting segments at 31
December 2011
86,199
23,527
3,006
468
113,200
2011
19
Fair value
Fair value is the amount for which an asset could be exchanged or a liability settled between
knowledgeable, willing parties in an arm’s length transaction.
Most of the Fund’s financial instruments are carried at fair value at the reporting date and the fair value
of the financial instruments could be reliably determined within a reasonable range of estimates. For
certain other financial instruments, including placements with banks, liabilities for unsettled purchased
securities and other liabilities, the carrying amounts approximate fair value due to the immediate or short
term maturity of these financial instruments.
The Management Company considers that the carrying amounts of the Fund’s financial assets and
financial liabilities at the reporting date approximate their fair values.
Estimation of fair values
The major methods and assumptions used in estimating the fair values of financial instruments are
disclosed in Note 3: Significant accounting policies.
As stated in Note 4, the alternative valuations are subjective in nature and involve a significant level of
uncertainty and matters that rely on judgment. For this reason they cannot be confirmed with complete
confidence.
29
19
Fair value (continued)
Estimation of fair values (continued)
At 31 December 2012, the carrying amounts financial assets classified at fair value through profit or loss
which fair value could be determined by reference to trading and published price quotations amounted to
HRK 86,414 thousand (2011: HRK 106,065 thousand).
At 31 December 2012 the Fund didn’t have any financial instruments for which fair values were
determined using valuation techniques (2011: HRK 1,999 thousand or 1.77% of Fund’s net assest) and it
relates to debt securities. Valuation technique of long term debt securities refers to the valuation at
amortised cost using the effective interest method where their fair value is the initial value determined by
the last available market price.
Fair value measurement hierarchy
IFRS 7 Financial Instruments: Disclosures (“IFRS 7”) requires the determination of fair value hierarchy
of financial instruments on three levels and disclosure of financial instruments at fair value. The Fund
uses the following hierarchy of fair value measurement that reflects the significance of the inputs used in
making the measurement:
Level 1: The fair value of financial instruments is based on their quoted market price available in an
active market.
Level 2: The fair value of financial instruments is estimated using valuation techniques based on
observable inputs. This category includes instruments valued using reference to the fair value of another
instrument that is substantially the same, discounted cash flow techniques, or any other valuation
technique that provides a reliable estimate of prices obtained in actual market transactions.
Level 3: The fair value of financial instruments is estimated using valuation techniques based on
unobservable inputs.
The following table analyses financial instruments by the level in the fair value hierarchy into which the
fair value measurement is categorised:
31 December 2012
Debt securities
Equity securities
Investment funds
31 December 2011
Debt securities
Equity securities
Investment funds
Level 1
HRK'000
Level 2
HRK'000
Level 3
HRK'000
Total
HRK'000
16,435
67,576
2,403
-
-
16,435
67,576
2,403
86,414
-
-
86,414
Level 1
HRK'000
Level 2
HRK'000
16,968
86,091
3,006
1,999
-
-
18,967
86,091
3,006
106,065
1,999
-
108,064
Level 3
Total
HRK'000 HRK'000
30
19
Fair value (continued)
Fair value measurement hierarchy (continued)
As at 31 December 2012 and 31 December 2011 the Fund had no financial liabilities at fair value.
During 2012 there was no reclassification of financial instruments by levels of hierarchy of fair value
measurement.
20
Related party transactions
The Fund’s units are mainly held by Croatian investors. The Management Company considers that the
Fund has an immediate related party relationship with the Management Company and its parent company
Zagrebačka banka d.d. (“ZABA”), a bank incorporated in Croatia, the ultimate parent company of
Zagrebačka banka - Unicredit S.p.A, (“the UCI”), a bank incorporated in Italy, the Supervisory and
Management Board members of the Management Company (together “key management personnel of the
Management Company”); close family members of key management personnel; and entities jointly
controlled or significantly influenced by the members of the Management Boards of the Management
Company and their close family members and other investment funds managed by the same Management
Company.
a) Key transactions with immediate related parties
The Fund has entered into a number of transactions with ZABA and other members of the UCI Group.
The parent company also provides custody services to the Fund as disclosed in the statement of
comprehensive income and Note 9.
As at 31 December 2012 and 31 December 2011 the Fund has resources at giro account with ZABA. At
31 December 2012, nor at 31 December 2011, the Fund had no holdings in the investment funds
managed by the Management Company.
There are no subscription fees in the Fund.
For withdrawals of units invested for less than one year, the exit fee amounts to 2% of the withdrawal
amount, while units invested from one to two years, the exit fee amounts to 1% of the withdrawn amount.
For withdrawals of units invested for two years or more, no exit fee is charged. Additionally, for
withdrawals in the amount of HRK 300 thousand or more, no exit fee is charged.
These charges are not shown in the Fund’s accounts as they are immediately deducted from settlement
amounts payable to existing unitholders and are transferred to the Management Company. The
Management Company received a total of HRK 46 thousand (2011: HRK 169 thousand) from exit fees.
ZABA held 4,997.74 redeemable units of the Fund at 31 December 2012 (2011: 4,997.74 units), in the
amount of HRK 4,818 thousand (2011: HRK 4,744 thousand), which represented 5.02% (2011: 4.19%)
of the Fund’s net assets at prices officially approved by the regulator on that day.
At 31 December 2012 key management personnel of the Management Company held 8.17 (2011: 8.17
units) redeemable units, in the amount of HRK 8 thousand (2011: HRK 8 thousand) which represented
0.01% (2011: 0.01%) of the Fund’s total net assets at officially approved prices on that day.
31
20
Related parties transactions (continued)
b) Amounts arising from transactions with immediate related parties
2012
ZB Invest d.o.o. za upravljanje investicijskim
fondovima
Group members
Zagrebačka banka d.d.
2011
ZB Invest d.o.o. za upravljanje investicijskim
fondovima
Group members
Zagrebačka banka d.d.
Assets
HRK‘000
Liabilities
HRK‘000
Income
HRK‘000
Expenses
HRK‘000
-
174
-
2,193
22,479
1
25
337
22,479
175
25
2,530
Assets
HRK‘000
Liabilities
HRK‘000
Income
HRK‘000
Expenses
HRK‘000
-
213
-
3,108
9,771
2
24
476
9,771
215
24
3,584
According to the Investment Fund Act Article 2, “Persons related to the Fund” are the Management
Company, depositary bank, lawyer, law firm, law office or joint law office, auditor and tax advisor who
are in a contractual relationship based on the provision of services to the Fund, as well as any other
person who has, in the previous two calendar years, concluded a contract on the provision of services to
the Fund.
For 2012, the audit expenses amounted to HRK 38 thousand (2011: HRK 43 thousand), as disclosed in
Note 10, and liabilities for auditor fees amounted to HRK 37 thousand (2011: HRK 43 thousand), as
disclosed in Note 15.
32
Appendix 1 – Financial statements in accordance with the Ordinance on the
investment funds
IFP Form
Name of the fund: ZB TREND
Personal identification number (OIB): 88183360964
Name of the investment fund management company: ZB INVEST D.O.O.
Reporting period: 1 January 2012 - 31 December 2012
(in HRK)
Accounts Groups
10
3+4+5+8
Asset position
AOP
31 December 2011
31 December 2012
Financial assets
(AOP2+ AOP3)
1
121,926,086
110,233,474
2
9,747,559
22,456,252
3
112,178,528
87,777,222
Investment in securities and deposits:
(AOP4+ AOP5+AOP6+AOP7)
Financial assets at fair value through profit and loss account
(AOP2+ AOP3)
4
109,558,609
87,777,222
level 4
Financial assets available for sale
5
0
0
level 8
6
2,619,919
0
level 5
Investments held to maturity
7
0
0
OTHER ASSETS
(Σ from AOP9 to AOP15)
8
577,406
229,931
Receivables from sale of securities and other receivables
9
0
0
13
Receivables from dividends, cash deposits and repayment of bonds
10
108,189
85,652
14
Receivables from given advances
11
0
0
15
Receivables from the management company
12
0
0
16
Receivables from the depository bank
13
0
0
17
Other fund receivables
14
0
0
18
Accrued interest receivables and other assets
15
469,217
144,278
A
TOTAL ASSETS
(AOP1+ AOP8)
16
122,503,492
110,463,405
Off-balance sheet asset items
17 0
0
FINANCIAL LIABILITIES
(AOP19+AOP20)
18 0
0
Liabilities from investments in securities and other liabilities
19 0
0
Liabilities ffrom investments in placements, deposits, and repo agreements
20 0
0
OTHER LIABILITIES
21 9,303,400
14,558,445
23
Liabilities to the fund management company
22 213,249
174,384
24
Liabilities to the depository bank
23 2,013
905
25
Liabilities arising from allowed expenses of the fund
24 3,013
2,606
26
Liabilities arising from payments to shareholders
25 9,042,076
14,343,050
27
Other liabilities
26 43,050
37,500
28
Accrued interest payable
27 0
0
28
9,303,400
14,558,445
29 113,200,092
95,904,960
level 3
11 + 12
990-994
20 + 21
22
B
C
Total liabilities
(AOP18+AOP21)
Net fund assets
(AOP16-AOP28)
D
30 119,262.25
99,490.96
E
Net assets per unit
(AOP29/AOP30)
31 949.17
963.96
90
Issued/withdrawn investment fund units
32
47,809,575
25,190,863
94
Profit/loss of the current financial year
33
-8,602,405
5,323,580
95
Retained earnings/loss carried forward
34
73,992,922
65,390,517
96
Revaluation of financial assets available for sale
35
0
0
97
Revaluation reserves for hedging instruments
36
0
0
F
Total liabilities according to sources of assets (Σ from AOP32 to AOP36)
37
113,200,092
95,904,960
38
0
0
995-999
Off-balance sheet liability items
33
investment funds (continued)
ISD Form
Stetement of comprehensive income
(in HRK)
Accounts groups
Position
AOP
Same period in the previous year
Current period
INVESTMENT INCOME
39
73
Realised gains FROM sale of financial instruments
40
9,546,640
8,434,676
70
Interest income
41
1,942,912
1,463,106
71x
Positive exchange rate differences from monetary financial instruments (excluding
securities)
42
8,445,900
4,396,342
74
Income from dividends
43
2,757,640
1,604,129
75
Other income
44
4
1
Total investment income
45
22,693,095
15,898,253
EXOENDITURE
46
63
Realised losses on sale of financial instruments
47
15,649,027
4,216,063
60x
Negative exchange rate differences from monetary financial instruments (excluding
securities)
48
11,363,474
4,026,577
61
Expenditure arising from the relationship with the management company
49
3,108,194
2,193,343
67
Interest expense
50
0
0
65
Depository bank fee
51
466,229
329,001
66
Transaction costs
52
252,127
105,661
64
Impairment of assets
53
0
0
69
Other allowed fund expenses
54
64,635
71,784
Total expenditures
55
30,903,686
10,942,430
Net gain/(loss) from investment in securities
(AOP45-AOP55)
56
-8,210,591
4,955,823
UNREALISED GAINS (LOSSES) FROM INVESTMENT IN SECURITIES AND
DERIVATIVES
57
Unrealised gains (losses) from investment in financial instruments
58
-7,779,225
2,051,644
72y- 62y
Unrealised gains (losses) from derivatives
59
0
0
71y - 60y
Net exchange rate differences from investment in securities
60
7,387,411
-1,683,888
Total unrealised gains (losses) from investment in securities and derivatives (Σ
from AOP58 to AOP60)
61
-391,814
367,756
Profit or loss
(AOP56+AOP61)
62
-8,602,405
5,323,580
(AOP64+AOP65)
63
0
0
Unrealised gains (losses) of financial assets available for sale
64
0
0
Gains/losses on hedging instruments in a cash flow hedge
65
0
0
Total comprehensive income
(AOP62+AOP63)
66
-8,602,405
5,323,580
Reclassification adjustments
67
0
0
72 - 62
(except 72y - 62y)
34
INT Form
Statement of cash flow (indirect method)
(in HRK)
Position
AOP
Same period in the previous year
Current period
Cash flow from operating activities
98
56,918,350
35,327,405
Profit or loss
99
-8,602,405
5,323,580
Unrealised positive and negative exchange rate differences
100
-7,387,411
1,683,888
Value adjustment for receivables and similar write-offs
101
0
0
Interest income
102
-1,942,912
-1,463,106
Interest expense
103
0
0
104
-2,757,640
-1,604,129
Impairment of financial assets
105
0
0
Increase (decrease) in financial assets at fair value through profit and loss account
106
68,135,691
20,097,500
Increase (decrease) of financial assets available for sale
107
0
0
Interest received
108
2,001,077
1,788,045
Interest paid
109
0
0
110
2,797,485
1,626,665
Increase (decrease) in other financial assets
111
11,826,280
2,619,919
Increase (decrease) in receivables arising from sale of securities and other
receivables
112
1,282,583
0
Increase (decrease) in receivables from the management company and depository
bank
113
0
0
Increase (decrease) in other receivables from operating activities
114
120,078
0
Increase (decrease) in liabilities arising from investment in securities and other
liabilities
115
-17,449,308
0
Increase (decrease) in liabilities arising from investment in placements, deposits
and repo agreements
116
0
0
Increase (decrease) in liabilities to the management company and depository bank
117
-88,965
-39,973
Increase (decrease) in other liabilities from operating activities
118
8,983,797
5,295,018
Cash flow from financing activities
119
-74,015,614
-22,618,712
Income from issue of units
120
394,528,238
622,833,519
Expenses for redemption of units
121
-468,543,851
-645,452,231
Payments to unit holders from realised profit
122
0
0
Increase (decrease) in other financing activities
123
0
0
Net increase (decrease) in cash and cash equivalents
(AOP98+ AOP119)
124
-17,097,263
12,708,693
Cash and cash equivalents at the beginning of period
125
26,844,822
9,747,559
Cash and cash equivalents at the end of period
(AOP124+AOP125)
126
9,747,559
22,456,252
35
IPNI Form
Statement of changes in Fund's net assets
(in HRK)
Position
1
Position
label
31 December 2011
Increase
2
3
4
Decrease
5
Total in the current period
31 December 2012
6 (4+5)
7 (3+6)
Net profit (loss) from investment in securities
127
-8,210,591
13,166,414
0
13,166,414
4,955,823
Total unrealised gains (losses) from investment in securities and
derivatives
128
-391,814
759,571
0
759,571
367,756
Revaluation reserves for financial assets available for sale
129
0
0
0
0
0
Revaluation reserves for hedging instruments
130
0
0
0
0
0
Increase/decrease in net assets from fund's operating activities
131
-8,602,405
13,925,985
0
13,925,985
5,323,580
Income from sale of issued units of the fund
132
1,964,280,737
622,833,519
622,833,519
2,587,114,256
Expenses for redemption of issued units of the fund
133
-1,916,471,162
-645,452,231
-645,452,231
-2,561,923,393
Total increase/decrease from transactions with fund units
(AOP132+AOP133)
134
47,809,575
622,833,519
-645,452,231
-22,618,712
25,190,863
Total increase/decrease innet assets
(AOP131+AOP134)
135
39,207,170
636,759,504
-645,452,231
-8,692,727
30,514,443
Retained earnings/loss carried forward
136
73,992,922
0
-8,602,405
-8,602,405
65,390,517
Change in accounting policies
137
0
0
0
0
0
Correction of fundamental errors
138
0
0
0
0
0
Total increase (decrease) in retained earnings
139
73,992,922
0
-8,602,405
-8,602,405
65,390,517
Total liabilities according to sources of assets
(AOP135+ OP139)
140
113,200,092
636,759,504
-654,054,636
-17,295,132
95,904,960
-
-
36
IPPF Form
Statement of Fund's special Indicators (Article 175 of the Investment Funds Act)
Position
Net fund assets
Number of fund units
Fund net asset value per unit
Current period
31 December 2011 (n)
31 December 2010 (n1)
1
2
3
4
5
95,904,959.67
113,200,092
195,818,111
118,779,301
117,855,688
99,490.96
119,262.25
195,265.23
133,618.80
164,299.09
963.96
949.17
1,002.83
888.94
717.32
Current period
2011. (n)
2010. (n-1)
2009. (n-2)
2008. (n-3)
Number of fund units at the
beginning of the period
119,262.25
195,265.23
133,618.80
164,299.09
237,115.67
Number of issued fund units
636,761.92
414,911.23
359,892.86
78,552.80
78,976.54
Number of redeemed fund units
-656,533.21
-490,914.21
-298,246.43
-109,233.09
-151,793.12
Number of fund units at the end
of the period
99,490.96
119,262.25
195,265.23
133,618.80
164,299.09
2.06%
2.05%
2.04%
2.05%
2.04%
Total return**
1.56%
-5.35%
12.81%
23.92%
-28.61%
Lowest fund net asset value per
unit
934.58
868.17
877.19
669.04
673.82
Highest fund net asset value per
unit
1,019.48
1,036.46
1,009.58
892.49
1,005.50
130,415,862
210,280,152
195,704,383
124,758,496
238,419,971
91,472,921
111,818,779
118,576,272
98,539,967
113,015,986
Total expense ratio
Paid profit per unit*
Highest net asset value
Lowest fund net asset value
Legal persons for mediation in securities trading through which the fund carried out more than 10% of its transactions in the current period
Legal persons for mediation securities trading
AKJ
Value of transactions carried out through legal
Commission paid to the legal person for
persons for mediation shown as a percentage of
mediation shown as a percentage of the total
the total value of all transactions of the fund in value of all transactions carried out through that
the current period
legal person
84.68%
0.06%
*paid profit per unit relates to funds with specific purposes (i.e. Retired Persons' Fundm Fund for Croatian Homeland War Veterans)
**net assets per unit on the last day of the reporting period - net assets per unit at the end of the previous reporting period
x100
net assets per unit at the end of the previous reporting period
37
Appendix 2 – Reconciliation of financial statements in accordance with IFRS and statements in accordance with the Ordinance on the structure and
content of financial statements of open ended investment funds
Financial stetments in accordance with IFRS
Financial statements in accordance with the Ordinance on the structure and content
of financial statements of open ended investment funds
2012
Note
HRK'000
AOP
2012
Difference
HRK'000
HRK'000
Remark
Current accounts with banks
11
22,456 Cash and cash equivalents
2
22,456
-
12
86,535 Financial assets at fair value through profit and loss account
4
87,777
-1,242
Comment 1 & 2
13
6
0
1,363
Comment 1
Receivables from dividends, cash deposits and repayment of bonds
10
86
Other assets
14
-121
Comment 2
Accrued interest receivable and other assets
15
144
16
110,463
Liabilities to the fund management company
22 174
Liabilities to the depository bank
23 1
24 3
Liabilities arising from payments to unitholders
25 14,343
Other liabilities
26 37
Total liabilities
14,558 Total liabilities
28
14,558
-
Net assets attributable to unitholders' funds
95,905 Net fund assets
29
95,905
-
99,491 Number of issued units
30
99,491
-
Net assets attributable to unitholders' funds per issued unit
963.96 Net assets per unit
31
963.96
-
Total Assets
Other liabilities
1,363 Loans and receivables
109
110,463 Total assets
15
14,558 Liabilities arising from allowed expenses of the fund
-
-
Comment 1. The difference in the amount of HRK 1.363 thousand relates to bonds - Fond za naknadu oduzete imovine which are presented in financial statement in accordance with IFRS as Loans and receivables.
Comment 2. - The difference in the amount of HRK 121thousand relates to accrued interest on debt securities at fair value through profit and loss which are presented in financial statement in accordance with IFRS
as Financial assets at fair value through profit and loss and in financail statements in accordance with the Ordinance as Accrued interest receivables and other assets.
38
Appendix 2 – Reconciliation of financial statements accordance with IFRS and statements in accordance with the Ordinance on the structure and
content of financial statements of open ended investment funds (continued)
Financial statements in accordance with IFRS
Financial statements in accordance with the Ordinance on the structure and content
of financial statements of open ended investment funds
2012
2012
Difference
HRK'000
HRK'000
Note
HRK'000
AOP
Interest income
5
1,587 Interest income
41
1,463
124
Dividend income
6
1,604 Income from dividends
43
1,604
-
Realised gains from sale of financial instruments
40
8,435
Realised losses from sale of financial instruments
47
-4,216
Unrealised gains/(losses) from investment in financial instruments
58
2,052
Net exchange rate differences from investement in securities
60
-1,684
Positive exchange rate differences from monetary financial instruments
(excluding securities)
42
4,396
Negative exchange rate differences from monetary financial instruments
(excluding securities)
48
-4,026
49
-2,193
-
51
-329
-
Transaction costs
52
-106
Other allowed fund expenses
54
-72
62
5,324
-
63
-
-
66
5,324
-
Net gains/(losses) on fianncial assets and liabilities at fair value
through profit or loss
7
Net gains/(losses) on translation of monetary assets and liabilities
4,463
370
Custody fee
9
-329 Depository bank fee
10
-178
Total increase/(decrease) in net unitholders' funds from
Comment 1.
8,024
8
Increase/(decrease) in net unitholders' funds from investment
activities
-124
Comment 1.
-
Investment management fee
Operating expenses
Remark
-2,193 Expenditures arising from the relationship with the management company
-2,700
5,324 Profit or loss
- Other comprehensive income
5,324 Total comprehensive income
Comment 1. The difference relates to realised and unrealised gains/(losses) from bonds - Fond za naknadu oduzete imovine which are presented in financial statement in accordance with IFRS as interest income.
In financial statement in accordance with IFRS bonds - Fond za naknadu oduzete imovine are presented as Loans and receivables.
39
Appendix 2 – Reconciliation of financial statements in accordance with IFRS and
statements in accordance with the Ordinance on the structure and
content of financial statements of open ended investment funds
(continued)
Statement of cash flows prepared in accordance with the Ordinance on the structure and content of financial
statements of open ended investment funds, shown on page 35 (“HANFA CF”), differ significantly in
presentation from the Statement of cash flows prepared in accordance with IFRS, shown on page 9 of the
financial statements (“CF”).
The main differences are described below:
The method used in preparation of HANFA CF is an indirect method while a direct method is used in
preparation of CF.
In the cash flow from financing activity in HANFA CF, gain or loss is reduced by unrealised net foreign
exchange differences, interest income, dividend income, and is increased by cash receipts from them.
The differences in positions of increasing or decreasing assets and liabilities in the CF and HANFA CF arise
due to differences in the positions of assets and liabilities for which the difference is taken into account, due to
different presentation of these positions in the financial statements prepared in accordance with IFRS in
relation to the requirements of the Ordinance.
Furthermore, a method of pure cash flow is used for changes in balances of financial assets for purposes of
compiling the CF, while in HANFA CF changes in balances include effects of changes in fair value and foreign
exchange differences or noncash items.
In the CF, cash and cash equivalents include giro accounts and placements with banks with original maturity
within three months, while cash and cash equivalents in HANFA CF include only giro accounts.
40

ZB trend - otvoreni investicijski fond Zagrebačke banke

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