Hong Leong Islamic Income Management Fund 2011/2012
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Hong Leong Islamic Income
Management Fund
Annual Report 2011/2012
31 October 2012 Audited
Hong Leong Asset Management Bhd (318717-M)
Level 8, Menara HLA, No. 3, Jalan Kia Peng, 50450 Kuala LumpurHong Leong Islamic Income Management Fund
Statement by the Manager and audited
financial statements for the twelve-month
financial year ended 31 October 2012
Contents
Pages
Manager’s Review and Report 1-13
Ulasan dan Laporan Pengurus 14-26
Statement Of Comprehensive Income 27
Statement Of Financial Position 28
Statement Of Changes In Equity 29
Statement Of Cash Flows 30
Notes to the Financial Statements 31-55
Trustee’s Report 56
Shariah Adviser’s Report 57
Statement by the Manager 58
Statutory Declaration 59
Independent Auditors’ Report 60-61
Performance Data 62-65
Corporate Information / Maklumat Korporat 66
Corporate Directory / Direktori Korporat 67
Hong Leong Islamic Income Management Fund 1Manager’s Review and Report
Dear Unitholder,
We wish to present to you the Hong Leong Islamic Income
Management Fund’s (HLIIMF) audited annual report for the
12-month financial year ended 31 October 2012.
It has been a buoyant period for the Malaysian sukuk markets,
albeit risk-on/risk-off dynamic over news of the global central
banks to avert the lingering European debt crisis and to bolster
the slowing global economy continues to dominate investors’
sentiment.
The market run-up was boosted by the following themes:
• Renewed global growth concerns: Gloomy economic data in
the developed countries and the major emerging economies
spark worries of a broad-based global slowdown;
• Persistent worries over the depth of the European debt
crisis (due to political turmoil in Greece and the Spanish
banking woes);
• Unbridled release of liquidity by the European Central Bank
(ECB) via long-term refinancing operations (LTROs) spurred
the allure of emerging market currencies and prompted
foreign funds to flow into emerging market debts;
• Expectations of neutral/downward bias to interest rate
decisions by Bank Negara Malaysia (BNM);
• Easing inflationary pressures;
• Fresh round of quantitative easing (QE3) and the unlimited
purchase of European distressed sovereign debts program
launched by the Federal Reserve and ECB.
BNM has thus far (at the MPC meeting on 8 November 2012)
remained accommodative to keep the economy growing by
maintaining the overnight policy rate at 3.00% in view of the
faltering global growth prospects.
We continue to be cautiously optimistic on the Malaysian
economic outlook and cognizant of global headwinds confronting
a general slowdown in the pace of growth and Euro-area
concerns. The Malaysian economy is relatively healthy and is
Hong Leong Islamic Income Management Fund 1growing at a robust pace. Meanwhile, goodies and cash handouts
from the Budget 2013 as well as the stimulus excitement from
ETP-related projects will serve as strong catalysts to support
domestic consumption in 2013, while helping to shrug off the
adverse impacts on the external front.
Outside Malaysia, it is “the economy is improving but not great”
scenario. Most notably, US retail sales and housing starts were
stronger than expected, contributing to the sense that the US
economy may be gaining momentum. China’s data also may
tentatively suggest its growth is poised to stabilize. Moreover,
fears of a severe deterioration of the euro crisis appear to be
ebbing, as the EU met for its latest summit to hash out details
on fiscal and banking union reforms.
Strategy-wise, we have significantly reduced the duration of
our portfolio, preferring credit for yield pick-up. However, sukuk
markets remain expensive as a result of the continuing uptrend in
foreign ownership of outstanding Malaysian Government Sukuk,
reducing overall yield levels.
For the review period, the Fund had distributed 12 times income
distributions of 0.12 sen per unit on 25 November 2011, 0.12 sen
per unit on 23 December 2011, 0.13 sen per unit on 25 January
2012, 0.12 sen per unit on 24 February 2012, 0.10 sen per unit on
23 March 2012, 0.12 sen per unit on 25 April 2012, 0.10 sen per
unit on 25 May 2012, 0.11 sen per unit on 25 June 2012, 0.11 sen
per unit on 25 July 2012, 0.11 sen per unit on 24 August 2012, 0.12
sen per unit on 25 September 2012 and 0.12 sen per unit on 25
October 2012.
The cum-distribution net asset values (NAVs) for the 12
distributions were RM0.5035, RM0.5035, RM0.5045,
RM0.5047, RM0.5042, RM0.5045, RM0.5043, RM0.5045,
RM0.5048, RM0.5049, RM0.5045 and RM0.5046 while the
ex-distribution NAVs were RM0.5023, RM0.5023, RM0.5032,
RM0.5035, RM0.5032, RM0.5033, RM0.5033, RM0.5034,
RM0.5037, RM0.5038, RM0.5033 and RM0.5034. The reason
for conducting the income distributions was to generate regular
income for investors on a monthly basis. Investors should note
2 H on g L eon g I slamic I ncome M ana g ement F undthat the income distributions did not affect the value of their
investment.
Last but not least, we would like to thank you for all the support
that you have rendered us and we will strive to make the
opportunities work for you.
I. HLIIMF’s PERFORMANCE MEASURED AGAINST
INVESTMENT OBJECTIVE
Investment Objective
Hong Leong Islamic Income Management Fund (HLIIMF) is an
Islamic fixed income (Income) fund. Its objective is to provide
investors with a low risk investment portfolio offering a stable
and regular stream of income* and stability in capital** while
adhering to Shariah Requirements.
Distribution Policy
The Fund aims to provide monthly cash distributions on a best
effort basis. The rate of the cash distribution will be determined
at every month end in order to bring the NAV of the Fund to the
proposed range of RM0.5000 per Unit. The distribution will be
subject to availability of sufficient reserves for cash distribution.
Investors should note that regular distributions of the Fund are
not guaranteed and are not in any way to forecast the future or
likely performance of the Fund.
Performance Review
Over the past twelve months, HLIIMF posted a total return of
3.08% while its benchmark, the Maybank 1 Month GIA-I Tier
1 Rate returned 2.92% for the same period under review. This
translated into 0.16% outperformance against the benchmark.
Notes:
* Income may be distributed in the form of cash and/or units.
** Please take note that this Fund is not a capital guaranteed fund or
a capital protected fund and the returns are not guaranteed.
Hong Leong Islamic Income Management Fund 3The Fund has met its objective of providing a stable stream of
income to its Unitholders, while maintaining the stability of the
invested capital throughout the review period.
Going forward, the Fund remains actively managed and
positioned to seize opportunities in the current market
environment, as the Fund will continue to strive to provide a
stable stream of income while maintaining the stability of the
invested capital.
For the financial year, there were no significant changes to
the state of affairs of the Fund or circumstances that would
materially affect the interest of the Unitholders up to the date
of this manager’s report.
I I. INVESTMENT PORTFOLIO
Chart 1: Asset Allocation as at 31 October 2012
Shariah-based
Deposits, Receivables
and others Private Sukuk
73.64% 21.20%
Government
Sukuk
5.16%
4 H on g L eon g I slamic I ncome M ana g ement F undChart 2: Portfolio Composition by Ratings
AAA
Shariah-based 12.97% A1
Receivables 21.90%
and others
0.09% AA2
20.68%
Government
Sukuk
5.16%
AA1
2.93%
AA3
A2 5.23%
31.04%
As of 31 October 2012, the Fund is predominantly invested in
short-tenured private sukuk. The Fund had significantly reduced
its exposure to government sukuk due to the volatility caused by
the recent wave of global central banks policy actions across the
developed countries.
Currently, the Fund’s duration stands at 1.77 years, in line with
our strategy to ensure capital stability.
The top-three holdings of the Fund are DanaInfra Nasional
Berhad - Government Sukuk (5.16%), Manjung Island Energy
Berhad - Private Sukuk (4.19%) and Aman Sukuk Berhad - Private
Sukuk (4.10%).
Hong Leong Islamic Income Management Fund 5Chart 3: Asset Allocation from November 2011 to
October 2012
Nov- Dec- Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep- Oct-
11 11 12 12 12 12 12 12 12 12 12 12
Sukuk
III. PERFORMANCE REVIEW
Financial Highlights
The Net Asset Value of the Fund attributable to Unitholders is
represented by:
Unitholders’ Fund 2012 2011 Change
(RM) (RM) (%)
Unitholders’ Capital 483,246,351 120,736,293 300.25
Distribution Equalisation 35,169 (298,697) 111.77
Retained Earnings
- Unrealised Reserve / (Deficit) 97,915 (154,545) 163.36
- Undistributed Income 235,535 361,782 -34.90
Net Asset Value 483,614,970 120,644,833 300.86
Units in Circulation 960,450,897 240,575,416 299.23
6 H on g L eon g I slamic I ncome M ana g ement F undTable 1: Performance of HLIIMF on NAV Per Unit-to-NAV
Per Unit basis for the period 31 October 2011 to
31 October 2012 (Source: Lipper)
31-Oct-11 31-Oct-12 Returns
(%)
NAV Per Unit RM0.5020^ RM0.5035 3.08#
Benchmark* 3.00% 2.75% 2.92
vs Benchmark (%) - - 0.16
* Benchmark: Maybank 1 Month GIA-I Tier 1 Rate
# Return is calculated after adjusting for income distributions of 0.12 sen,
0.12 sen, 0.13 sen, 0.12 sen, 0.10 sen, 0.12 sen, 0.10 sen, 0.11 sen, 0.11 sen,
0.11 sen, 0.12 sen and 0.12 sen on 25/11/2011, 23/12/2011, 25/01/2012,
24/02/2012, 23/03/2012 25/04/2012, 25/05/2012, 25/06/2012,
25/07/2012, 24/08/2012, 25/09/2012 and 25/10/2012 respectively.
^ In accordance with FRS 139, quoted financial assets have been valued
at the bid prices at the close of business. Nonetheless, quoted financial
assets have been valued at the closing market prices for the purpose of
calculating net asset value (“NAV”) per unit attributable to Unitholders for
issuance and redemption of units. Hence, the NAV per unit disclosed above
is different from the NAV per unit disclosed in the financial statements.
Table 2: Fund performance measured against its peers
group as rated by Lipper
31/07/12- 30/04/12- 31/10/11- 31/10/10- 31/10/09- 31/10/07-
31/10/12 31/10/12 31/10/12 31/10/12 31/10/12 31/10/12
3 Months 6 Months 1 Year 2 Years 3 Years 5 Years
HLIIMF
Returns (%) 0.62 1.40 3.08 5.78 8.16 14.80
Mean of Islamic
Money Market
Funds (%) 0.70 1.39 2.59 5.76 7.69 13.65
Hong Leong Islamic Income Management Fund 7Chart 4: 31 October 2011 to 31 October 2012 NAV Per
Unit-to-NAV Per Unit, Based On Malaysian
Ringgit, Versus Maybank 1 Month GIA-I Tier 1
Rate (Source: Lipper)
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00
31/10/2011
30/11/2011
31/12/2011
31/1/2012
29/2/2012
31/3/2012
30/4/2012
31/5/2012
30/6/2012
31/7/2012
31/8/2012
30/9/2012
31/10/2012
From 31/10/2011 To 31/10/2012
Hong Leong Maybank 1 Month GIA-i
Islamic Income Tier I Rate 2.92
Management 3.08
Investors are advised that past performance of the
Fund is not an indication of the future performance
of the Fund. The value of your units may go down as
well as up.
8 H on g L eon g I slamic I ncome M ana g ement F undTable 3: The Highest and Lowest NAV Per Unit, Total
Return of the Fund, and the breakdown into
Capital Growth and Income Distribution for the
financial years
Financial Year Financial Financial
From Year From Year From
31/10/11– 29/10/10- 30/10/09–
31/10/12 31/10/11 29/10/10
Highest NAV Per Unit 0.5049 0.5039 0.5045
Lowest NAV Per Unit 0.5021 0.5018 0.5026
Capital Growth (%) 0.30 -0.14 -0.20
Income Distribution (%) 2.78 2.76 2.45
Total Return (%) 3.08 2.62 2.25
Source: Lipper, Based on Malaysian Ringgit, ex-distribution, NAV Per Unit-
to-NAV Per Unit basis with income distributions reinvested, if any.
Table 4: Average Total Return of the Fund measured over
the following periods, to date of the financial
year as at 31 October 2012
31/10/11– 31/10/09– 31/10/07–
31/10/12 31/10/12 31/10/12
1 Year 3 Years 5 Years
Average Total Return (%) 3.08 2.72 2.96
Source: Lipper, Based on Malaysian Ringgit, ex-distribution, NAV Per Unit-
to-NAV Per Unit basis with income distributions reinvested, if any.
Hong Leong Islamic Income Management Fund 9Chart 5: Comparison between the Fund’s performance
and the performance of the benchmark disclosed
in the prospectus covering the last five financial
years
16.00
14.00
12.00
10.00
8.00
6.00
4.00
2.00
0.00
31/10/2007
31/12/2007
31/12/2008
31/12/2009
31/12/2010
31/12/2011
31/10/2012
From 31/10/2007 To 31/10/2012
Hong Leong Maybank 1 Month GIA-i
Islamic Income Tier I Rate 13.39
Management 14.80
Source: Lipper, Based on Malaysian Ringgit, ex-distribution, NAV Per Unit-
to-NAV Per Unit basis with income distributions reinvested, if any.
10 H on g L eon g I slamic I ncome M ana g ement F undIV. REVIEW OF THE MARKET IN WHICH THE FUND
INVESTED DURING THE PERIOD
Sukuk prices rallied as investors bided safe assets amid renewed
economic worries. Buoyant sentiment was also underpinned
by the persistent fears over the Eurozone debt turmoil, which
spurred flight to qualities and kept sovereign sukuk yields in a
bull-flattening trend.
News of ECB issuance of €530 billion of fresh 3-year loan via
LTRO into the European banking system further enhanced the
allure of emerging market currencies and shaped a supportive
ground for the Malaysian sukuk markets.
After a strong run up since the second quarter of 2012, the
government sukuk market experienced a sharp selloff in the
months of August and September caused by profit taking
of government sukuk on stronger Ringgit as well as looming
uncertainty on the impending elections amid sparse liquidity.
However, sukuk prices regained firmer footing at the tail end
of the financial year as a fresh round of quantitative easing
(QE3) boosted the demand for emerging market debts and
benefited government sukuk prices. Meanwhile, resurgence of
the global growth worries aggravated investors’ concerns over
a prolonged global economic slowdown and invited risk-off
trades among investors.
Despite a sharper-than-anticipated economic slowdown on
the global front, the Malaysian economy continues to grow
solidly, with the second quarter GDP posting a decent growth
of 5.4%. Thanks to the resilient domestic demand conditions
and the implementation of the high-impact projects under the
ETP and 10th Malaysia Plan, which supported domestic growth
momentum amid buzz of the 13th General Election.
On the monetary policy front, BNM maintained the OPR at
3.00% over the past twelve months. The tone of the policy
statement signals an extended rate pause to ensure a stronger
domestic economic recovery as external risks are still very much
present and it would be premature to raise interest rates.
Hong Leong Islamic Income Management Fund 11Inflation, on the other hand, bucked the regional trend as it
eased to 1.3% in September 2012 from 3.2% in 2011, providing
more leeway for BNM to continue calling for rate pause in the
near term.
V. FUTURE PROSPECTS AND PROPOSED STRATEGIES
Global economic growth continues to be hampered by
uncertainty stemming from stagnant developments in the
developed countries. In the Euro area, Spain has yet to tap into
ECB’s Outright Monetary Transaction (OMT) programme,
bringing the progress of resolving the Euro debt crisis to a
standstill.
In the US, political gridlock remains a huge barrier to a swift
resolution on its looming ‘Fiscal Cliff’, where budget cuts and
automatic expiration of tax provisions of an estimated USD
560 billion or 3.5% of US GDP will bring about a significant
slowdown in its economy.
As such, with robust domestic consumption supporting the
local economy, we expect BNM to continue its accommodative
stance in the OPR for the remainder of the year to provide room
for manoeuvre in the event of any adverse developments in the
global economic condition.
We believe that the increased liquidity created by monetary
policy easing in several countries such as Europe, US and Japan
will be supportive for the local sukuk markets.
With the pledges of long-term low interest rates in the advanced
economies, stable emerging markets such as Malaysia will be
viewed favourably by investors in their search for higher yielding
investments amidst a gradually improving risk sentiment, as can
be seen from the current whopping 41.5% government sukuk
held by foreigners.
However, we are not expecting a rally in the government sukuk
market as seen in the first half of the year due to the looming
12 H on g L eon g I slamic I ncome M ana g ement F unduncertainty of imminent elections. As such, we continue to
shorten duration where possible to reduce the impact of market
volatility in the near term and search for corporate sukuk with
solid fundamentals and strong cash flows that pay a reasonable
rate of return.
VI. BREAKDOWN OF UNITHOLDINGS BY SIZE
Size of Holdings No. of Accounts No. Units Held
5,000 and below 35 50,201.10
5,001 to 10,000 12 87,380.03
10,001 to 50,000 37 1,000,863.98
50,001 to 500,000 28 4,442,798.35
500,001 and above 22 954,864,653.08
Vii. Stockbroking Rebates and Soft CommissionS
The Manager received soft commissions from stockbrokers
in the form of goods and services such as research materials,
data and quotation services, computer software incidental
to investment management of the Fund and investment
related publications. Such soft commissions received are of
demonstrable benefit to the Unitholders.
Hong Leong Islamic Income Management Fund 13Ulasan dan Laporan Pengurus
Pemegang Unit yang Dihormati,
Kami membentangkan kepada anda laporan tahunan beraudit
Hong Leong Islamic Income Management Fund (HLIIMF) untuk
tahun kewangan 12-bulan berakhir 31 Oktober 2012.
Ia adalah tempoh cergas untuk pasaran sukuk Malaysia,
walaupun dinamik risiko tinggi/risiko rendah akibat aliran berita
dari bank-bank pusat global yang berusaha untuk mengelak
daripada krisis hutang Eropah yang berlanjutan dan untuk
merangsang ekonomi global yang perlahan masih mendominasi
sentimen pelabur.
Pergerakan pasaran ini telah dimangkin oleh keadaan berikut:
• Kebimbangan pertumbuhan global kembali ke pasaran: Data
ekonomi yang suram di negara-negara membangun dan
ekonomi baru muncul utama mencetuskan kebimbangan
akan berlaku kemelesetan global yang meluas;
• Kebimbangan berterusan mengenai krisis hutang Eropah
yang semakin teruk (akibat pergeseran politik di Greece
dan masalah perbankan Sepanyol);
• Suntikan kecairan tanpa henti oleh Bank Pusat Eropah
(ECB) melalui operasi pembiayaan jangka panjang (LTRO)
mencetuskan minat ke atas matawang pasaran baru
muncul dan menyebabkan dana asing mengalir masuk ke
pasaran hutang baru muncul;
• Keputusan kadar faedah oleh Bank Negara Malaysia
(BNM) dijangka neutral / cenderung menurun;
• Tekanan inflasi yang berkurangan;
• Pusingan terbaru pelonggaran kuantitatif (QE3) dan
program pembelian tanpa had hutang kerajaan Eropah
yang bermasalah yang telah dilancarkan oleh Federal
Reserve dan ECB.
Setakat ini, BNM (semasa mesyuarat MPC pada 8 November
2012) kekal bertolak ansur untuk terus menggalakkan
pertumbuhan ekonomi dengan mengekalkan kadar dasar
semalaman pada 3.00% memandangkan prospek pertumbuhan
global yang agak goyah buat masa ini.
14 H on g L eon g I slamic I ncome M ana g ement F undKami masih agak optimistik dengan unjuran ekonomi Malaysia dan berwaspada dengan pergolakan global yang mungkin memperlahankan pertumbuhan serta ketidakstabilan yang melanda Eropah. Ekonomi Malaysia masih sihat dan berkembang pada kadar yang cergas. Sementara itu, pembangunan dan agihan tunai dari Bajet 2013 serta keterujaan dari projek berkaitan ETP akan bertindak sebagai pemangkin kukuh untuk menyokong penggunaan domestik pada 2013, dan membantu menampan impak yang membimbangkan dari luar. Di luar Malaysia, keadaan “ekonomi sedang mengalami pemulihan tetap tidak hebat”. Paling ketara, jualan runcit dan perumahan di AS bermula lebih kukuh dari jangkaan, menyumbang kepada keyakinan bahawa momentum ekonomi AS mungkin telah bermula. Data China juga mungkin turut menyarankan bahawa pertumbuhannya telah mula stabil kembali. Tambahan pula, kebimbangan mengenai kemerosotan krisis Eropah kelihatan berkurangan apabila EU bertemu untuk mesyuarat terbarunya untuk menghuraikan tindakan lanjut mengenai pemulihan fiskal dan kesatuan perbankan. Dari segi strategi pula, kami telah mengurangkan tempoh portfolio kita, memilih kredit untuk peningkatan pulangan. Bagaimanapun, pasaran sukuk kekal mahal akibat trend menaik pemilikan asing di dalam Sukuk Kerajaan Malaysia, sekaligus mengurangkan tahap pulangan secara menyeluruh. Semasa tempoh di bawah ulasan, Dana telah membayar agihan tunai sebanyak 12 kali iaitu 0.12 sen se unit pada 25 November 2011, 0.12 sen se unit pada 23 Disember 2011, 0.13 sen se unit pada 25 Januari 2012, 0.12 sen se unit pada 24 Februari 2012, 0.10 sen se unit pada 23 Mac 2012, 0.12 sen se unit pada 25 April 2012, 0.10 sen se unit pada 25 Mei 2012, 0.11 sen se unit pada 25 Jun 2012, 0.11 sen se unit pada 25 Julai 2012, 0.11 sen se unit pada 24 Ogos 2012, 0.12 sen se unit pada 25 September 2012 dan 0.12 sen se unit pada 25 Oktober 2012. Nilai aset bersih (NAV) sebelum agihan untuk 12 agihan tersebut masing-masing ialah RM0.5035, RM0.5035, RM0.5045, RM0.5047, RM0.5042, RM0.5045, RM0.5043, RM0.5045, Hong Leong Islamic Income Management Fund 15
RM0.5048, RM0.5049, RM0.5045 dan RM0.5046 manakala
NAV selepas agihan masing-masing ialah RM0.5023, RM0.5023,
RM0.5032, RM0.5035, RM0.5032, RM0.5033, RM0.5033,
RM0.5034, RM0.5037, RM0.5038, RM0.5033 dan RM0.5034.
Tujuan agihan pendapatan dilaksanakan adalah untuk menjana
pendapatan tetap kepada pelabur secara bulanan. Pelabur
diminta mengambil perhatian bahawa agihan tunai tidak
menjejaskan nilai pelaburan mereka.
Akhir kata, kami ingin mengucapkan ribuan terima kasih di
atas sokongan yang telah anda berikan dan kami akan sentiasa
berusaha untuk menjadikan peluang suatu kenyataan buat anda.
I. PRESTASI HLIIMF BERBANDING OBJEKTIF PELABURAN
Objektif Pelaburan
Hong Leong Islamic Income Management Fund (HLIIMF) adalah
dana pendapatan tetap Islam (Pendapatan). Objektifnya
adalah untuk menjana pendapatan* secara tetap dan teratur
serta menyediakan kestabilan modal** kepada pelabur melalui
portfolio pelaburan berisiko rendah yang mematuhi Shariah.
Dasar Agihan
Dana menyasarkan untuk menyediakan agihan tunai secara
bulanan berasaskan usaha terbaik. Kadar agihan tunai
akan ditentukan pada akhir setiap bulan dalam usaha untuk
menjadikan NAV Dana berada pada lingkungan cadangan
RM0.5000 se unit. Agihan adalah tertakluk kepada terdapatnya
rizab yang mencukupi untuk agihan tunai. Pelabur adalah
diingatkan bahawa agihan secara tetap oleh Dana adalah tidak
dijamin dan bukanlah ramalan atau unjuran masa hadapan
prestasi Dana.
Nota:
* Pendapatan mungkin diagihkan dalam bentuk tunai dan/atau unit.
** Sila ambil perhatian bahawa Dana ini bukan dana modal dijamin
atau dana modal dilindungi dan pulangan adalah tidak dijamin.
16 H on g L eon g I slamic I ncome M ana g ement F undUlasan Prestasi
Sepanjang dua belas bulan lepas, HLIIMF telah mencatatkan
jumlah pulangan sebanyak 3.08% manakala penanda arasnya,
Kadar Tier 1 GIA-I 1-Bulan Maybank mencatatkan pulangan
sebanyak 2.92% untuk tempoh yang sama di bawah ulasan.
Dana mengatasi prestasi penanda arasnya sebanyak 0.16%.
Dana telah mencapai objektifnya untuk menyediakan aliran
pendapatan yang stabil kepada Pemegang Unitnya di samping
mengekalkan kestabilan modal yang dilaburkan sepanjang
tempoh ulasan.
Di masa hadapan, Dana akan terus diuruskan dan diletakkan
secara aktif untuk merebut peluang di dalam suasana pasaran
semasa, dan Dana akan sentiasa berusaha untuk menjana aliran
pendapatan yang tetap di samping mengekalkan kestabilan
modal yang dilaburkan.
Untuk tahun kewangan, tidak berlaku sebarang perubahan
ketara di dalam urusniaga Dana mahupun mengalami sebarang
situasi yang boleh menjejaskan kepentingan Pemegang Unit
sehingga ke tarikh laporan pengurus ini dibuat.
II. PORTFOLIO PELABURAN
Rajah 1: Pembahagian Aset sehingga pada 31
Oktober 2012
Deposit, Bolehterima
dan lain-lain
berasaskan-Syariah Sukuk Swasta
73.64% 21.20%
Sukuk Kerajaan
5.16%
Hong Leong Islamic Income Management Fund 17Rajah 2 : Pembahagian Portfolio mengikut Penarafan
Bolehterima AAA
dan lain-lain 12.97% A1
berasaskan-Syariah 21.90%
0.09%
AA2
20.68%
Sukuk
Kerajaan
5.16%
AA1
2.93%
AA3
A2 5.23%
31.04%
Sehingga 31 Oktober 2012, Dana melabur secara utama di
dalam sukuk swasta jangka pendek. Dana telah mengurangkan
sebahagian besar pendedahannya dalam sukuk kerajaan
akibat perubahan tindakan dasar bank pusat global di negara
membangun.
Buat masa ini, tempoh pelaburan Dana adalah 1.77 tahun, sejajar
dengan strategi kami untuk memastikan kestabilan modal.
Tiga pegangan utama Dana adalah DanaInfra Nasional Berhad
– Sukuk Kerajaan (5.16%), Manjung Island Energy Berhad –
Sukuk Swasta (4.19%) dan Aman Sukuk Berhad – Sukuk Swasta
(4.10%).
18 H on g L eon g I slamic I ncome M ana g ement F undRajah 3: Pembahagian aset dari November 2011
hingga Oktober 2012
Nov- Dec- Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep- Oct-
11 11 12 12 12 12 12 12 12 12 12 12
Sukuk
III. ULASAN PRESTASI
Sorotan Kewangan
Nilai Aset Bersih diwakili oleh dana pemegang unit adalah seperti
berikut:
Dana Pemegang Unit 2012 2011 Change
(RM) (RM) (%)
Modal Pemegang Unit 483,246,351 120,736,293 300.25
Penyamaan Agihan 35,169 (298,697) 111.77
Perolehan Tertahan
- Rizab /(Defisit)Tidak Direalisasi 97,915 (154,545) 163.36
- Pendapatan Tidak Diagih 235,535 361,782 -34.90
Nilai Aset Bersih 483,614,970 120,644,833 300.86
Unit dalam Edaran 960,450,897 240,575,416 299.23
Hong Leong Islamic Income Management Fund 19Jadual 1: Prestasi HLIIMF berdasarkan NAV se unit-
ke-NAV se unit bagi tempoh 31 Oktober 2011
hingga 31 Oktober 2012 (Sumber: Lipper)
31-Okt-11 31-Okt-12 Pulangan
(%)
NAV Se Unit RM0.5020^ RM0.5035 3.08#
Penanda Aras* 3.00% 2.75% 2.92
vs Penanda Aras - - 0.16
* Penanda Aras: Kadar Tier 1 GIA-I 1-Bulan Maybank
# Pulangan dikira selepas diselaraskan untuk agihan pendapatan 0.12 sen,
0.12 sen, 0.13 sen, 0.12 sen, 0.10 sen, 0.12 sen, 0.10 sen, 0.11 sen, 0.11
sen, 0.11 sen, 0.12 sen dan 0.12 sen masing-masing pada 25/11/2011,
23/12/2011, 25/01/2012, 24/02/2012, 23/03/2012 25/04/2012,
25/05/2012, 25/06/2012, 25/07/2012, 24/08/2012, 25/09/2012 dan
25/10/2012.
^ Selaras dengan FRS 139, aset kewangan disenarai telah dinilai pada harga
bidaan semasa perniagaan ditutup. Bagaimanapun, aset kewangan
disenarai telah dinilai pada harga pasaran ditutup untuk tujuan pengiraan
nilai asset bersih (“NAV”) se unit disumbangkan oleh pemegang unit untuk
terbitan dan penebusan unit. Oleh itu, NAV se unit yang dinyatakan di atas
adalah berbeza daripada NAV se unit yang dinyatakan di dalam penyata
kewangan.
Jadual 2: Prestasi Dana berbanding kumpulan dana
serupa menurut penarafan Lipper
31/07/12- 30/04/12- 31/10/11- 31/10/10- 31/10/09- 31/10/07-
31/10/12 31/10/12 31/10/12 31/10/12 31/10/12 31/10/12
3 Bulan 6 Bulan 1 Tahun 2 Tahun 3 Tahun 5 Tahun
Pulangan
HLIIMF (%) 0.62 1.40 3.08 5.78 8.16 14.80
Min Dana
Pasaran Wang
Islam (%) 0.70 1.39 2.59 5.76 7.69 13.65
20 H on g L eon g I slamic I ncome M ana g ement F undRajah 4: 31 Oktober 2011 hingga 31 Oktober 2012 NAV
se unit-ke-NAV se unit, Berdasarkan Ringgit
Malaysia, Berbanding Kadar Tier 1 GIA-I 1-Bulan
Maybank (Sumber : Lipper)
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00
31/10/2011
30/11/2011
31/12/2011
31/1/2012
29/2/2012
31/3/2012
30/4/2012
31/5/2012
30/6/2012
31/7/2012
31/8/2012
30/9/2012
31/10/2012
Dari 31/10/2011 Hingga 31/10/2012
Hong Leong Maybank 1 Month GIA-i
Islamic Income Tier I Rate 2.92
Management 3.08
Pelabur adalah dinasihatkan bahawa prestasi masa
lampau Dana bukanlah jaminan prestasi masa
hadapan Dana. Nilai unit anda boleh turun atau naik.
Hong Leong Islamic Income Management Fund 21Jadual 3: NAV se unit Terendah & Tertinggi, Jumlah
P u l a n g a n D a n a , d a n p e ca h a n ke p a d a
Pertumbuhan Modal dan Agihan Pendapatan
untuk tahun kewangan
Tahun Tahun Tahun
Kewangan dari Kewangan dari Kewangan dari
31/10/11– 29/10/10- 30/10/09–
31/10/12 31/10/11 29/10/10
NAV se unit Tertinggi (RM) 0.5049 0.5039 0.5045
NAV se unit Terendah (RM) 0.5021 0.5018 0.5026
Pertumbuhan Modal (%) 0.30 -0.14 -0.20
Agihan Pendapatan (%) 2.78 2.76 2.45
Jumlah Pulangan (%) 3.08 2.62 2.25
Sumber: Lipper, Berdasarkan Ringgit Malaysia, selepas agihan, atas dasar NAV
se unit-ke-NAV se unit dengan agihan pendapatan dilaburkan-semula, jika ada.
Jadual 4: Purata Jumlah Pulangan Dana diukur sepanjang
tempoh berikut, sehingga ke tarikh tahun
kewangan pada 31 Oktober 2012
31/10/11– 31/10/09– 31/10/07–
31/10/12 31/10/12 31/10/12
1 Tahun 3 Tahun 5 Tahun
Purata Jumlah Pulangan (%) 3.08 2.72 2.96
Sumber: Lipper, Berdasarkan Ringgit Malaysia, selepas agihan, atas dasar NAV
se unit-ke-NAV se unit dengan agihan pendapatan dilaburkan-semula, jika ada.
22 H on g L eon g I slamic I ncome M ana g ement F undJadual 5: Perbandingan di antara prestasi Dana dan
prestasi penanda aras dinyatakan di dalam
prospektus merangkumi lima tahun kewangan
terakhir
16.00
14.00
12.00
10.00
8.00
6.00
4.00
2.00
0.00
31/10/2007
31/12/2007
31/12/2008
31/12/2009
31/12/2010
31/12/2011
31/10/2012
Dari 31/10/2007 Hingga 31/10/2012
Hong Leong Maybank 1 Month GIA-i
Islamic Income Tier I Rate 13.39
Management 14.80
Sumber: Lipper, Berdasarkan Ringgit Malaysia, selepas agihan, atas dasar
NAV se unit-ke-NAV se unit dengan agihan pendapatan dilaburkan-semula,
jika ada.
Hong Leong Islamic Income Management Fund 23IV. ULASAN PASARAN DI MANA DANA MELABUR
SEPANJANG TEMPOH
Harga sukuk mengalami lonjakan apabila pelabur membida
aset selamat semasa berhadapan dengan kebimbangan
ekonomi yang muncul kembali. Sentimen cergas juga disokong
oleh kebimbangan yang masih dialami akibat pergolakan
hutang Eropah, yang mencetuskan peralihan kepada kualiti
dan mengekalkan pulangan sukuk kerajaan dalam aliran tegak
menaik.
Berita mengenai ECB menerbitkan pinjaman baru 3-tahun
berjumlah €530 bilion melalui LTRO ke dalam sistem perbankan
Eropah turut menggalakkan minat ke atas matawang pasaran
baru muncul dan membentuk sokongan yang kukuh untuk
pasaran sukuk Malaysia.
Setelah mengalami kenaikan kukuh sejak suku kedua 2012,
pasaran sukuk kerajaan dilanda jualan turun yang besar pada
bulan Ogos dan September yang berpunca dari pengambilan
untung sukuk kerajaan berikutan Ringgit yang kukuh serta
ketidakpastian mengenai pilihanraya yang bakal berlangsung
dan kecairan yang berkurangan.
Bagaimanapun, harga sukuk kembali kukuh pada penghujung
tahun kewangan apabila pusingan baru pelonggaran
kuantitatif (QE3) memangkin permintaan untuk hutang
pasaran baru muncul dan memberi manfaat kepada harga
sukuk kerajaan. Sementara itu, kebimbangan mengenai
pertumbuhan global yang muncul kembali telah menambah
kerisauan pelabur berhubung keperlahanan ekonomi global
yang masih berlanjutan dan mewujudkan dagangan demi
mengelakkan risiko di kalangan pelabur.
Walaupun ekonomi global mengalami keperlahanan yang
lebih teruk dari jangkaan, ekonomi Malaysia masih terus
mengalami pertumbuhan yang teguh, di mana KDNK suku
kedua mencatatkan pertumbuhan yang memuaskan pada
5.4%. Meskipun terdapat tanda tanya mengenai Pilihanraya
Umum ke-13, momentum pertumbuhan domestik ini telah
disokong oleh suasana permintaan domestik yang teguh
bertahan dan pelaksanaan projek berimpak tinggi di bawah
ETP dan Rancangan Malaysia ke-10.
24 H on g L eon g I slamic I ncome M ana g ement F undUntuk dasar kewangan pula, BNM mengekalkan OPR pada
kadar 3.00% sepanjang dua belas bulan lepas. Dasar yang
dinyatakan ini menandakan pemberhentian sejenak kadar akan
dilanjutkan untuk memastikan pemulihan ekonomi tempatan
yang lebih kukuh memandangkan risiko luaran masih dirasai
dan agak terlalu awal untuk menaikkan kadar faedah.
Inflasi pula bergerak bertentangan berbanding aliran serantau
apabila ia menyusut ke 1.3% pada bulan September berbanding
3.2% pada 2011, membolehkan BNM meneruskan pengekalan
kadar untuk jangka pendek.
V. PROSPEK MASA HADAPAN DAN SARANAN
STRATEGI
Pertumbuhan ekonomi global masih terus dibelenggu oleh
ketidakpastian yang berpunca daripada pembangunan yang
lembap di negara membangun. Di Eropah pula, Sepanyol masih
belum mendapatkan program Transaksi Moniteri Langsung
(OMT) yang ditawarkan oleh ECB, menjadikan progres
penyelesaian krisis hutang Eropah tergendala.
Di AS pula, percanggahan politik masih menjadi halangan
utama untuk menyelesaikan “Fiscal Cliff” yang bakal berlaku,
di mana pemotongan bajet dan penamatan automatik
peruntukan cukai yang dianggarkan bernilai USD 560 juta atau
3.5% daripada KDNK AS akan menyebabkan kemelesetan
ketara dalam ekonominya.
Oleh itu, dengan penggunaan domestik yang menyokong
ekonomi tempatan, kami menjangkakan bahawa BNM akan
meneruskan langkah akomodasinya dengan mengekalkan
OPR sehingga akhir tahun untuk menyediakan ruang tindakan
sekiranya keadaan ekonomi global mengalami perubahan
ketara.
Kami percaya peningkatan kecairan yang disebabkan oleh
pelonggaran dasar moniteri di beberapa negara seperti Eropah,
AS dan Jepun akan membantu menyokong pasaran sukuk
tempatan.
Hong Leong Islamic Income Management Fund 25Dengan adanya jaminan kadar faedah rendah untuk jangka
panjang oleh negara maju, pasaran baru muncul yang stabil
seperti Malaysia akan dilihat sebagai amat menarik oleh
pelabur yang mencari pulangan lebih tinggi untuk pelaburan
mereka, tambahan pula sentimen risiko turut mengalami
pemulihan beransur-ansur. Keyakinan ini dapat dilihat di mana
41.5% sukuk kerajaan kini dipegang oleh pelabur asing.
Bagaimanapun, kami tidak menjangkakan sebarang loncatan di
pasaran sukuk tempatan sebagaimana yang berlaku pada suku
pertama tahun berikutan adanya ketidakpastian mengenai
pilihanraya yang bakal berlangsung. Oleh itu, kami akan
terus memendekkan tempoh pegangan selagi terdaya untuk
mengurangkan impak kemeruapan pasaran dalam tempoh
terdekat dan mencari sukuk yang memiliki asas yang kukuh
dan aliran tunai teguh yang mampu membayar kadar pulangan
yang sewajarnya.
VI. PECAHAN PEGANGAN UNIT MENGIKUT SAIZ
Saiz Pegangan Jumlah Akaun Jumlah Unit Dipegang
5,000 dan kurang 35 50,201.10
5,001 hingga 10,000 12 87,380.03
10,001 hinga 50,000 37 1,000,863.98
50,001 hingga 500,000 28 4,442,798.35
500,001 dan ke atas 22 954,864,653.08
VII. REBAT PEMBROKERAN DAN KOMISEN DALAM
BENTUK BUKAN WANG
Pengurus telah menerima komisen dalam bentuk bukan wang
daripada broker dalam bentuk barangan dan perkhidmatan
seperti bahan-bahan penyelidikan, data dan perkhidmatan
harga, perisian komputer yang berkaitan dengan pengurusan
pelaburan Dana dan penerbitan berkaitan pelaburan. Komisen
dalam bentuk bukan wang yang diterima adalah digunakan
untuk manfaat pemegang-pemegang unit amanah.
Laporan kewangan ini adalah terjemahan dari versi
Bahasa Inggeris kepada Bahasa Melayu. Jika terdapat
percanggahan antara versi Bahasa Inggeris dan terjemahan
versi Bahasa Melayu, maka versi Bahasa Inggeris akan
diterima pakai.
26 H on g L eon g I slamic I ncome M ana g ement F undSTATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 OCTOBER 2012
2012 2011
Note RM RM
INVESTMENT INCOME
Profit from bank balances
and Shariah-based deposits 6,117,226 3,020,155
Profit from sukuk 2,899,259 3,197,370
Other income 290,662 -
Amortisation of premium, net of
accretion of discount (197,450) (496,550)
Net gain/(loss) on financial
instruments at fair value through
profit or loss (“FVTPL”) 6 247,850 (289,525)
9,357,547 5,431,450
EXPENDITURE
Management fee 3 (1,337,177) (865,425)
Trustee’s fee 4 (213,948) (138,468)
Auditors’ remuneration (5,500) (6,800)
Tax agent’s fee (2,600) (2,600)
Administration expenses (62,763) (39,468)
(1,621,988) (1,052,761)
Net income before taxation 7,735,559 4,378,689
Taxation 5 (264,859) -
Net income after taxation 7,470,700 4,378,689
Other comprehensive loss
Net unrealised loss on Shariah-compliant
investments - -
Total comprehensive income for the year 7,470,700 4,378,689
Net income after taxation is made up of:
Realised income 7,218,240 4,735,332
Unrealised gain/(loss) 252,460 (356,643)
7,470,700 4,378,689
The accompanying notes form an integral part of the financial statements.
Hong Leong Islamic Income Management Fund 27STATEMENT OF FINANCIAL POSITION AS AT 31 OCTOBER 2012 2012 2011 Note RM RM ASSETS Financial assets at FVTPL 6 127,487,518 53,958,785 Shariah-based deposits with financial institutions 8 354,631,000 64,513,000 Amount due from the Manager, net 9 - 1,546,266 Profit receivable from Shariah-based deposits 234,860 85,494 Profit receivable from sukuk 1,118,059 537,836 Other prepayments 58,448 600 Cash at banks 10 299,204 21,331 TOTAL ASSETS 483,829,089 120,663,312 LIABILITIES Amount due to the Manager, net 9 177,734 - Amount due to the Trustee 27,799 8,451 Cash distributions payable - 64 Other payables and accruals 8,586 9,964 TOTAL LIABILITIES 214,119 18,479 EQUITY Unitholders’ capital 11(a) 483,246,351 120,736,293 Distribution equalisation 35,169 (298,697) Retained earnings 333,450 207,237 TOTAL EQUITY 11 483,614,970 120,644,833 TOTAL LIABILITIES AND EQUITY 483,829,089 120,663,312 UNITS IN CIRCULATION 11(a) 960,450,897 240,575,416 NET ASSET VALUE (“NAV”) PER UNIT 0.5035 0.5015 The accompanying notes form an integral part of the financial statements. 28 H on g L eon g I slamic I ncome M ana g ement F und
STATEMENT OF CHANGES IN EQUITY
FOR THE FINANCIAL YEAR ENDED 31 OCTOBER 2012
Unitholders’ Distribution Retained
capital equalisation earnings Total equity
Note RM RM RM RM
As at 1 November 2010 198,761,684 (159,062) 450,912 199,053,534
Total comprehensive income
for the year - - 4,378,689 4,378,689
Cash distributions for the
year 12 - - (4,622,364) (4,622,364)
Creation of units 192,900,912 - - 192,900,912
Cancellation of units (271,065,938) - - (271,065,938)
Distribution equalisation 139,635 (139,635) - -
As at 31 October 2011 120,736,293 (298,697) 207,237 120,644,833
As at 1 November 2011 120,736,293 (298,697) 207,237 120,644,833
Total comprehensive income
for the year - - 7,470,700 7,470,700
Cash distributions for the
year 12 - - (7,344,487) (7,344,487)
Creation of units 665,932,290 - - 665,932,290
Cancellation of units (303,088,366) - - (303,088,366)
Distribution equalisation (333,866) 333,866 - -
As at 31 October 2012 483,246,351 35,169 333,450 483,614,970
The accompanying notes form an integral part of the financial statements.
Hong Leong Islamic Income Management Fund 29STATEMENT OF CASH FLOWS FOR THE FINANCIAL YEAR ENDED 31 OCTOBER 2012 2012 2011 Note RM RM CASH FLOWS FROM OPERATING AND INVESTING ACTIVITIES Proceeds from sale of financial assets at FVTPL 40,163,134 132,039,998 Proceeds from sukuk maturity 9,000,000 100,000,000 Purchase of financial assets at FVTPL (122,641,467) (170,626,158) Profit received from bank balances and Shariah-based deposits 5,967,860 3,005,269 Profit received from sukuk 2,319,036 4,079,309 Reimbursement received from the Manager 290,662 - Management fee paid (1,216,252) (895,043) Trustee’s fee paid (194,600) (143,207) Tax paid (322,707) - Other expenses paid (72,382) (47,014) Net cash (used in)/generated from operating and investing activities (66,706,716) 67,413,154 CASH FLOWS FROM FINANCING ACTIVITIES Receipts from creation of units 667,531,453 192,274,200 Payments for cancellation of units (303,084,377) (271,065,938) Cash distributions paid (7,344,487) (4,622,364) Net cash generated from/(used in) financing activities 357,102,589 (83,414,102) NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 290,395,873 (16,000,948) CASH AND CASH EQUIVALENTS AT BEGINNING OF FINANCIAL YEAR 64,534,331 80,535,279 CASH AND CASH EQUIVALENTS AT END OF FINANCIAL YEAR 354,930,204 64,534,331 Cash and cash equivalents comprise: Cash at banks 10 299,204 21,331 Shariah-based deposits with financial institutions 8 354,631,000 64,513,000 354,930,204 64,534,331 The accompanying notes form an integral part of the financial statements. 30 H on g L eon g I slamic I ncome M ana g ement F und
NOTES TO THE FINANCIAL STATEMENTS
- 31 OCTOBER 2012
1. THE FUND, THE MANAGER AND THEIR PRINCIPAL
ACTIVITIES
Hong Leong Islamic Income Management Fund (hereinafter
referred to as “the Fund”) was constituted pursuant to
the execution of a Deed dated 16 March 2007 and the
Supplemental Deeds dated 11 April 2007 and 30 April 2010
(“the Deed” collectively), between the Manager, Hong Leong
Asset Management Bhd., the Trustee, CIMB Commerce Trustee
Berhad (formerly known as BHLB Trustee Berhad) and the
registered unitholders of the Fund.
The investment criteria of the Fund is to invest in a portfolio of
permitted investments, which include Islamic money market
instruments, sukuk and government sukuk in Malaysia and
other foreign countries approved for investments by the
Securities Commission Malaysia’s Guidelines whilst adhering
to Shariah requirements.
The primary objective of the Fund is to provide investors with
a low risk investment portfolio offering a stable and regular
stream of income and stability in capital while adhering to
Shariah requirements.
The Fund commenced operations on 26 April 2007 and will
continue its operations until terminated in accordance to Part
12 of the Deed. The Manager of the Fund is Hong Leong Asset
Management Bhd., a company incorporated in Malaysia.
The principal activity of the Manager is the management
of unit trust funds and private investment mandates. Its
holding company is Hong Leong Capital Berhad, a company
incorporated in Malaysia and listed on the Main Market of
Bursa Malaysia Securities Berhad.
Hong Leong Islamic Income Management Fund 312. SIGNIFICANT ACCOUNTING POLICIES
2.1 Basis of Preparation
The financial statements of the Fund have been prepared
in accordance with Financial Reporting Standards (“FRSs”)
and the Securities Commission Malaysia’s Guidelines on
Unit Trust Funds in Malaysia.
The financial statements have been prepared on the
historical cost basis except as disclosed in the accounting
policies below and are presented in Ringgit Malaysia
(“RM”).
2.2 Changes in Accounting Policies
The accounting policies adopted are consistent with those
of the previous financial year, except for the adoption of
new and revised FRSs and Interpretations of the Issues
Committee (“IC Interpretations”) which are effective for
its financial year beginning on or after 1 November 2011.
Except as discussed below, these new and revised FRSs and
IC Interpretations do not give rise to any significant effects
on the financial statements of the Fund.
Amendments to FRS 7: Improving Disclosures about
Financial Instruments
Amendments to FRS 7 requires additional disclosures
about fair value measurement and liquidity risk. Fair value
measurements related to items recorded at fair value
are to be disclosed by source of inputs using a three level
fair value hierarchy by class, for all financial instruments
recognised at fair value. In addition, a reconciliation
between the beginning and ending balance for level 3 fair
value measurements is now required, as well as significant
transfers between levels in the fair value hierarchy. The
amendments also clarify the requirements for liquidity
management.
32 H on g L eon g I slamic I ncome M ana g ement F und2.3 Summary of Significant Accounting Policies
(a) Financial Assets
Financial assets are recognised in the statement of
financial position when, and only when, the Fund
becomes a party to the contractual provisions of the
financial instrument.
When financial assets are recognised initially, they are
measured at fair value, plus, in the case of financial
assets not at FVTPL, directly attributable transaction
costs.
The Fund determines the classification of its financial
assets at initial recognition, and the categories include
financial assets at FVTPL and loans and receivables.
(i) Financial Assets at FVTPL
Financial assets are classified as financial assets at
FVTPL if they are held for trading or are designated
as such upon initial recognition. Financial assets
held for trading include Shariah-compliant equity
securities, Islamic derivative and Shariah-based
collective investment schemes.
Subsequent to initial recognition, financial assets at
FVTPL are measured at fair value. Changes in the
fair value of the financial instruments are recorded in
‘Net gain or loss on financial instruments at FVTPL’
in the statement of comprehensive income. Profit
earned and amortisaton of premium/accrection of
discount are recorded separately in ‘Profit from bank
balances and Shariah-based deposits’ and ‘Profit
from sukuk’ and ‘Amortisation of premium, net of
accretion of discount’.
Hong Leong Islamic Income Management Fund 33The fair values of quoted Shariah-compliant equity
securities, quoted Islamic derivative and quoted
Shariah-based collective investment schemes are
determined by reference to closing bid prices quoted
on Bursa Malaysia Securities Berhad at the last
business day of the financial year end.
The fair value of unquoted sukuk is valued by
reference to indicative prices published by the Bond
Pricing Agency Malaysia on a daily basis.
(ii) Loans and receivables
Financial assets with fixed or determinable
payments that are not quoted in an active market
are classified as loans and receivables. The Fund
includes Shariah-based deposits with financial
institutions, cash at banks and short term receivables
in this classification.
Subsequent to initial recognition, loans and
receivables are measured at amortised cost using
the effective profit method. Gains and losses are
recognised in profit or loss when the loans and
receivables are derecognised or impaired, and
through the amortisation process. The Fund does
not have any loan receivables as at reporting date.
(b) Impairment of Financial Assets
The Fund assesses at each reporting date whether there
is any objective evidence that a financial asset classified
as loans and receivables is impaired.
To determine whether there is objective evidence that an
impairment loss on financial assets has been incurred,
the Fund considers factors such as the probability of
insolvency or significant financial difficulties of the
debtor and default or significant delay in payments.
34 H on g L eon g I slamic I ncome M ana g ement F undIf any such evidence exists, the amount of impairment
loss is measured 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 profit method. The impairment loss
is recognised in profit or loss.
The carrying amount of the financial asset is reduced
by the impairment loss directly for all financial assets
with the exception of trade receivables, where the
carrying amount is reduced through the use of an
allowance account. When a trade receivable becomes
uncollectible, it is written off against the allowance
account.
If in a subsequent period, the amount of the impairment
loss decreases and the decrease can be related
objectively to an event occurring after the impairment
was recognised, the previously recognised impairment
loss is reversed to the extent that the carrying amount
of the asset does not exceed its amortised cost at the
reversal date. The amount of reversal is recognised
in profit or loss. The Fund does not have any loan
receivables as at reporting date.
(c) Financial Liabilities
Financial liabilities are classified according to the
substance of the contractual arrangements entered
into and the definitions of a financial liability.
Financial liabilities, within the scope of FRS 139, are
recognised in the statement of financial position
when, and only when, the Fund becomes a party to
the contractual provisions of the financial instrument.
Financial liabilities are classified as other financial
liabilities.
Hong Leong Islamic Income Management Fund 35The Fund’s other financial liabilities which include
trade and other payables are recognised initially at fair
value plus directly attributable transaction costs and
subsequently measured at amortised cost using the
effective profit method.
A financial liability is derecognised when the obligation
under the liability is extinguished. Gains and losses
are recognised in profit or loss when the liabilities are
derecognised, and through the amortisation process.
(d) Income Recognition
Income is recognised to the extent that it is probable
that the economic benefits will flow to the Fund and the
income can be reliably measured. Income is measured at
the fair value of consideration received or receivable.
Profit from bank balances and Shariah-based deposits,
profit from sukuk, amortisation of premium and
accretion of discount are recognised using the effective
profit method.
Dividend income from quoted Shariah-compliant
equity securities and distribution income from quoted
Shariah-based collective investment schems are
recognised when the Fund’s right to receive payment
is established.
(e) Classification of Realised and Unrealised Gains and
Losses
Unrealised gains and losses comprise changes in the
fair value of financial instruments for the year and from
reversal of prior year’s unrealised gains and losses for
financial instruments which were realised (i.e. sold,
redeemed or matured) during the financial year.
Realised gains and losses on disposal of financial
instruments classified as part of ‘at FVTPL’ are
calculated using the weighted average method. They
represent the difference between an instrument’s
36 H on g L eon g I slamic I ncome M ana g ement F undcarrying amount based on the weighted average
method and the disposal amount of Shariah-compliant
investments.
(f) Income Tax
Current tax assets and liabilities are measured at the
amount expected to be recovered from or paid to the
tax authorities. The tax rates and tax laws used to
compute the amount are those that are enacted or
substantively enacted by the reporting date.
Current taxes are recognised in profit or loss. No
deferred tax is recognised as there are no material
temporary differences.
(g) Cash and Cash Equivalents
Cash and cash equivalents represent cash at bank
and Shariah-based deposits with financial institutions
which are readily convertible to cash on handwith
insignificant risk of changes in value.
(h) Unitholders’ Capital
The unitholders’ capital of the Fund meets the definition
of puttable instruments classified as the Fund’s
own equity instruments under the revised FRS 132.
Distribution to unitholders are recorded in equity when
declared.
Distribution equalisation represents the average
distributable amount included in the creation and
cancellation prices of units. This amount is either
refunded to unitholders by way of distribution and/or
adjusted accordingly when units are cancelled.
Hong Leong Islamic Income Management Fund 37(i) Significant Accounting Estimates and Judgements
The preparation of financial statements in accordance
with FRSs requires the use of certain accounting
estimates and exercise of judgements. Estimates and
judgements are continually evaluated and are based
on past experience, reasonable expectations of future
events and other factors.
No major estimations have been made by the Manager
in applying the Fund’s accounting policies. There are
no key assumptions concerning the future and other
key sources of estimation uncertainty at the reporting
date, that have a significant risk of causing a material
adjustment to the carrying amounts of assets and
liabilities within the next year.
2.4 Malaysian Financial Reporting Standards
On 19 November 2011, the Malaysian Accounting Standard
Board (“MASB”) issued a new MASB approved accounting
framework, the Malaysian Financial Reporting Standards
(MFRS Framework”).
The Fund will be required to prepare financial statements
using the MFRS Framework in its first MFRS financial
statements for the year ending 31 October 2013.
The directors of the Manager are of the opinion that the
financial performance and financial position as disclosed in
these financial statements for the year ended 31 October
2012 would not be significantly different if prepared under
the MFRS Framework.
3. MANAGEMENT FEE
The management fee is 0.50% per annum calculated on the net
asset value of the Fund on a daily basis as provided under Division
13.1 of the Deed.
4. TRUSTEE’S FEE
The Trustee’s fee is 0.08% per annum calculated on the net
asset value of the Fund on a daily basis, subject to a minimum of
RM18,000 per annum as provided under Division 13.2 of the Deed.
38 H on g L eon g I slamic I ncome M ana g ement F und5. TAXATION
2012 2011
RM RM
Under provision of tax in prior years 264,859 -
Profit from bank balances, Shariah-based deposits, sukuk,
accretion of discount and realised gain on sale of Shariah-compliant
investments derived by the Fund are tax exempted under the
relevant provisions of the Income Tax Act 1967. Hence, there is no
taxation for the Fund for the current financial year.
A reconciliation of income tax expense applicable to net income
before taxation at the Malaysian statutory income tax rate to
income tax expense at the effective income tax rate of the Fund is
as follows:
2012 2011
RM RM
Net income before taxation 7,735,559 4,378,689
Taxation at Malaysian statutory
rate of 25% 1,933,890 1,094,672
Income not subject to tax (2,389,902) (1,554,381)
Net loss not deductible for tax purpose 50,514 196,519
Expenses not deductible for tax purposes 64,514 39,165
Restriction on tax deductible expenses for
unit trust funds 340,984 224,025
Under provision of tax in prior years 264,859 -
Tax expense for the financial year 264,859 -
Hong Leong Islamic Income Management Fund 396. FINANCIAL ASSETS AT FVTPL
2012 2011
RM RM
Financial assets held for trading:
Sukuk 127,487,518 53,958,785
Net gain/(loss) on financial instruments at
FVTPL comprised:
Realised (loss)/gain on disposals (4,610) 67,118
Unrealised changes in fair values of Shariah
-compliant investment 252,460 (356,643)
247,850 (289,525)
Financial assets held for trading as at 31 October 2012 are as
detailed below:
Sukuk
Percentage of
fair value
over net
Nominal Adjusted Fair asset value
value cost value of the Fund
units RM RM %
Unquoted Sukuk
4.35% AISL SUB SUKUK
(A1) 31/01/2017# 10,000,000 10,158,918 10,163,918 2.10
3.750% AMAN IMTN
(AAA) 12.04.2017-
TRANCHE NO. 14 12,000,000 12,000,000 12,033,600 2.49
3.900% AMAN IMTN
(AAA) 27/07/2022 20,000,000 20,000,000 19,808,000 4.10
4.230% AMAN IMTN
(AAA) 27/07/2027 10,000,000 10,000,000 9,924,000 2.05
4.40% AmIslamic Bank
Berhad (A1)
30/09/16## 15,000,000 15,035,281 15,150,000 3.13
7.95% Kesas Sdn Bhd
(AA3) 11/10/2013 5,000,000 5,195,404 5,174,500 1.07
4.00%KLK IMTN
(AA1) 02.09.2022-
ISSUE NO.1 10,000,000 10,000,000 9,992,000 2.07
3.95% MANJUNG IMTN
(AAA) 24/11/1
- Series 1 (2) 20,000,000 20,000,000 20,284,000 4.19
102,000,000 102,389,603 102,530,018 21.20
40 H on g L eon g I slamic I ncome M ana g ement F undPercentage of
fair value
over net
Nominal Adjusted Fair asset value
value cost value of the Fund
units RM RM %
Government Sukuk
3.740% DANAINFRA IMTN
20/07/2022 25,000,000 25,000,000 24,957,500 5.16
TOTAL FINANCIAL ASSETS
AT FVTPL 127,389,603 127,487,518 26.36
EXCESS OF ADJUSTED COST OVER
FAIR VALUE 97,915
# Representing call date, which is earlier than the maturity date on
31 January 2022.
## Representing call date, which is earlier than the maturity date on
30 September 2021.
Effective yield of the Fund’s sukuk as at 31 October 2012 was
3.93% per annum.
7. SHARIAH INFORMATION OF THE FUND
The Shariah Adviser confirmed that the investments portfolio
of the Fund is Shariah-compliant, and comprises the following:
(i) Sukuk as per the list of approved sukuk issued by the
Securities Commission Malaysia’s Guidelines and
government of Malaysia; and
(ii) Cash placements and liquid assets in local market, which
are placed in Shariah-compliant investments and/or
instruments.
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