AL BADR MURABAHA FUND (SAR) An Open Ended Mutual Fund ...
AL BADR MURABAHA FUND (SAR) An Open Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) Interim Condensed Financial Statements (Un-Audited)
For the six months period ended 30 June 2016 together with the Review Report to the Unitholders
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) INTERIM CONDENSED BALANCE SHEET (UN-AUDITED) As at 30 June 2016 (Amounts in SAR) Note
2016
2015
70,569,636 1,168,473,676 47,636,309 2,513 1,286,682,134
146,879,663 1,583,572,015 7,688,260 -1,738,139,938
527,700 25,055 215,831 768,586
706,582 43,020 161,213 910,815
1,285,913,548
1,737,229,123
88,356,329
120,870,578
14.5537
14.3726
ASSETS Cash at bank Investments Other receivables Prepaid Expenses Total assets
6 7
LIABILITIES Fund management fee payable Accrued expenses Other liabilities Total liabilities
8, 9 11
Net assets attributable to the Unitholders Units in issue (numbers) Net asset value – per unit
The accompanying notes 1 to 14 form an integral part of these interim condensed financial statements. The interim condensed financial statements appearing from page 1 to 10 were approved by the Fund Manager (as per the terms and conditions of the Fund) on 14th August 2016.
1
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) INTERIM CONDENSED STATEMENT OF INCOME (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) Note
2016
2015
8,661,566 5,500,029 (314,954)
6,056,354 4,229,729 (668,724)
(29,431) 13,817,210
(30,112) 9,587,247
(3,366,285) (35,951) (3,402,236) 10,414,974
(3,966,883) (43,020) (4,009,903) 5,577,344
INCOME Income on shari’a compliant placements Income on sukuks Amortisation of (premium) / discount on sukuks Amortisation of derivatives EXPENSES 8, 9 10
Fund management fee Other expenses NET INCOME FOR THE PERIOD
The accompanying notes 1 to 14 form an integral part of these interim condensed financial statements.
2
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) INTERIM CONDENSED STATEMENT OF CASH FLOWS (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) 2016
2015
CASH FLOWS FROM OPERATING ACTIVITIES Net income for the period
10,414,974
5,577,344
Adjustments to reconcile net income to net cash used in operating activities: Amortisation of premium
314,954
668,724
Changes in operating assets and liabilities Shari’a compliant placements Sukuks Other receivables Prepaid Expenses Fund management fee payable Accrued expenses Other liabilities Net cash generated from / (used in) operating activities
161,700,000 41,000,000 (39,152,013) (2,513) (62,984) (41,859) 29,431 174,199,990
(400,800,000) (172,309,575) (2,013,166) -211,322 (14,716) 30,112 (568,649,955)
CASH FLOWS FROM FINANCING ACTIVITIES Repayment of Borrowing Proceeds from issuance of units Payments for redemption of units Net cash (used in) / generated from financing activities
(790,011) 317,388,773 (420,340,361) (103,741,599)
-989,705,317 (397,489,389) 592,215,928
70,458,391 111,245 70,569,636
23,565,973 123,313,690 146,879,663
Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the period Cash and cash equivalents at the end of the period
The accompanying notes 1 to 14 form an integral part of these interim condensed financial statements.
3
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) INTERIM CONDENSED STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO THE UNITHOLDERS (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) 2016
2015
1,378,450,162
1,139,435,851
10,414,974
5,577,344
317,388,773
989,705,317
Payments for redemption of units Net change from unit transactions
(420,340,361) (102,951,588)
(397,489,389) 592,215,928
Net assets attributable to the Unitholders at the end of the period as at 30 June
1,285,913,548
1,737,229,123
Net assets attributable to the Unitholders at the beginning of the period as at 1 Jan Net income for the period Changes from unit transactions Proceeds from issuance of units
UNIT TRANSACTIONS
Units at the beginning of the period as at 1 January Units issued Units redeemed Net change in units Units at the end of the period as at 30 June
2016 2015 (In numbers) 95,454,924 79,553,305 21,934,922 (29,033,517) (7,098,595) 88,356,329
69,015,688 (27,698,415) 41,317,273 120,870,578
The accompanying notes 1 to 14 form an integral part of interim condensed financial statements.
4
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) INTERIM CONDENSED STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO THE UNITHOLDERS (UN-AUDITED) For the six months period ended 30 June 2016 1.
THE FUND AND ITS ACTIVITIES Al Badr Murabaha Fund Saudi Riyal (the “Fund”) is an open ended Saudi Riyal denominated investment fund based on an agreement between Saudi Fransi Capital (the “Fund Manager”) and investors (the “Unitholders”). The Fund commenced its operations on 1 September 1999. Al Badr Fund is a shari’ah compliant fund that has the objective of providing capital preservation and liquidity. The Fund invests in shari’ah compliant money market instruments and sukuks. The Fund is an income accumulation fund, whereby net income is reinvested in the Fund and is not distributed as dividend on the units. The Fund has updated their terms and conditions which have been approved by the CMA on 24 Sha’ aban 1436H (corresponding to 11 June 2015). The Fund Manager and Custodian of the Fund is Saudi Fransi Capital.
2.
REGULATORY AUTHORITY The Fund is governed by the Investment Fund Regulations (the “Regulations”) published by CMA on 3 Dhul Hijja 1427H (corresponding to 24 December 2006) detailing requirements for all funds within the Kingdom of Saudi Arabia.
3.
SUBSCRIPTION / REDEMPTION OF UNITS The Fund is open for subscriptions / redemptions with a cutoff time of 12:00 pm on every business day. The net asset attributable to the Unitholders of the Fund’s portfolio is determined on every business day (each a “Dealing day”). The net asset attributable to the Unitholders of the Fund for the purpose of subscription / redemption of units is determined by dividing the net assets of the Fund (book value of the Fund’s assets minus the Fund’s liabilities) by the total number of the Fund’s units outstanding on the relevant dealing day.
4.
BASIS OF PREPARATION
4.1
Statement of compliance These financial statements have been presented in accordance with the requirements of the accounting standards on financial reporting issued by the Saudi Organization of Certified Public Accountants (SOCPA). These interim financial statements have been presented in condensed form and do not include all the information presented in annual financial statements of the Fund; therefore, these interim condensed financial statements should be read in conjunction with the annual financial statements of the Fund for the year ended 31 December 2015. Certain prior period figures have been reclassified to conform with the current period presentation. These interim condensed financial statements does not necessarily constitutes an indication of the year end financial results.
4.2
Basis of measurement These interim condensed financial statements have been prepared under the historical cost convention using the accrual basis of accounting and the going concern concept. These interim condensed consolidated financial statements does not necessarily constitute an indication of the year-end financial results.
5
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) 4.
BASIS OF PREPARATION (CONTINUED)
4.3
Functional and presentation currency These financial statements have been presented in Saudi Riyal, which is also the functional currency of the Fund. All financial information presented has been rounded to the nearest Saudi Riyal (SAR).
4.4
Use of estimates and judgments In the ordinary course of business, the preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expense. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimates are revised and on prospective basis.
5.
SIGNIFICANT ACCOUNTING AND RISK MANAGEMENT POLICIES The significant accounting policies used in the preparation of these interim condensed financial statements and risk management policies are consistent with those used and disclosed in the annual financial statements for the year ended 31 December 2015.
6.
6.1
INVESTMENTS HELD TO MATURITY
Held to maturity Shari’a compliant placements Sukuks held at amortised cost Available for Sales Sukuks
2016
2015
6.1 6.2
838,600,000 238,631,471 1,077,231,471
1,205,200,000 286,914,661 1,492,114,661
6.3
91,242,205 1,168,473,676
91,457,354 1,583,572,015
Shari’a compliant placements The composition of Shari’a compliant placements by maturity as at each period end is set out below: 30 June 2016 Maturity
% of value
Up to 1 month 1-3 months 3-6 months 6-9 months 9-12 months
6
Cost SAR
13.19% 19.32% 37.94% 11.15% 18.4%
110,600,000 162,000,000 318,200,000 93,500,000 154,300,000
100.00%
838,600,000
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) 6.
INVESTMENTS (CONTINUED) 30 June 2015 Maturity
% of value
Up to 1 month 1-3 months 3-6 months 6-9 months 9-12 months
6.2
12.03% 16.40% 32.32% 27.72% 11.53% 100.00%
Cost SAR 145,000,000 197,700,000 389,500,000 334,000,000 139,000,000 1,205,200,000
Sukuks held at amortised cost 2016 242,274,238 (3,642,767) 238,631,471
Nominal amount Premium Sukuks at amortised cost
2015 289,336,400 (2,421,739) 286,914,661
Sukuks carries either a fixed rate or a floating commission rate plus margin. The composition of sukuks by maturity as at each period end is set out below: Carrying value Maturity Up to 1 year 1-2 years 2-3 years 3-4 years 4-5 years 6.3
2016
2015
55,083,994 -91,006,824 42,540,651 50,000,000
130,176,653 59,885,440 55,000,000 41,852,568 --
238,631,471
286,914,661
2016
2015
91,759,143 (516,938) 91,242,205
91,759,143 (301,789)
Sukuks – Available for sales Nominal amount Premium Sukuks at amortised cost
91,457,354
Available for sale investment consist of Sukuks carrying a floating rate plus margin. There is no active market available for sukuk and in the absence of market indicators cost is considered a reliable measure of the fair value of the sukuk. The fair value of the above sukuk approximates its par value; therefore, no reserve is created against these investments. The composition and residual maturities of Sukuks as at period end is set out below: Carrying value 2015 Maturity 2016 Up to 1 year 2-3 years 3-4 years
13,825,340 77,416,865 -91,242,205
7
-13,854,877 77,602,477 91,457,354
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) 7.
OTHER RECEIVABLES
Accrued commission income on shari’a compliant murabaha placements Proceeds Outstanding from Maturity of Sukuk Accrued commission income on sukuk
8.
2016
2015
8,133,520 37,000,000 2,502,789 47,636,309
5,803,845 -1,884,415 7,688,260
TRANSACTIONS WITH RELATED PARTIES Saudi Fransi Capital (the “Fund Manager”), Banque Saudi Fransi (the “Bank” and the shareholder of the Fund Manager), affiliates of the Fund Manager and other funds managed by the Fund Manager are related parties. In the ordinary course of its activities, the Fund transacts business with related parties. The related party transactions are governed by limits set by the regulations issued by CMA. All the related party transactions are approved by the Fund Board. At the end of the period, cash balance with the Bank amounted to SR 70.57 million (30 June 2015: SR 146.88 million). Amount of transaction during the period 2015 2016
Name of related party
Nature of transaction
Saudi Fransi Capital Banque Saudi Fransi Board of Directors
Management fee Wa’ad contracts Annual remuneration
3,366,285 29,431 12,153
3,966,883 30,112 25,141
Closing balance 2015 2016 527,700 215,831 3,744
706,582 161,213 25,141
The units in issue at 30 June 2016 include units held by the employees of Banque Saudi Fransi and Saudi Fransi Capital: 74,833 units (30 June 2015: 1,260 units). The units in issue at 30 June 2016 include units held by Allianz Saudi Fransi of 14,709,716 units (30 June 2015: 13,762,238 units). 9.
FUND MANAGEMENT FEES AND OTHER CHARGES The Fund pays a management fee calculated at an annual rate of 0.5% of the net asset value. This is accrued daily and paid on a monthly basis. The Fund Manager also recovers from the Fund any other expenses incurred on behalf of the Fund such as audit fee, board compensation and other similar charges.
10.
OTHER EXPENSES 2016 (12,153) (23,798) (35,951)
Professional fees Fund board fees
8
2015 (17,879) (25,141) (43,020)
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS (UN-AUDITED) For the six month period ended 30 June 2016 11.
COMMITMENTS Derivative Commitments In hedging certain foreign currency investments, the Fund has entered into forward exchange contracts (Wa’ad). The analysis of derivative financial instruments and the related fair value gain / (loss) values together with the notional amounts classified by the term to maturity is as follows: Fair value gain / (loss)
12.
Notional amount
Less than 1 Year
1-3 Year
30 June 2016 Forward foreign exchange contracts
215,831
54,892,500
--
54,892,500
Total
215,831
54,892,500
--
54,892,500
30 June 2015 Forward foreign exchange contracts
161,213
56,767,500
--
56,767,500
Total
161,213
56,767,500
--
56,767,500
FAIR VALUES OF FINANCIAL INSTRUMENTS Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial instruments comprise financial assets and financial liabilities. The Fund’s financial assets comprise of bank balance, investments held to maturity and other receivables, and its financial liabilities comprise of fund management fee payable, accrued expenses and other liabilities. The fair values of financial instruments are not materially different from their carrying values.
13.
SUBSCRIPTION REQUEST The Fund has received subscription requests as of 30 June 2016, amounting to SAR 69,251 (30 June 2015: 283,946) after the cutoff time and hence issued units subsequent to period end
14.
LAST VALUATION DAY In accordance with terms and conditions of the Fund, the last valuation date of the period was 30 June 2016 (2015: 30 June 2015). The last valuation date for the purpose of preparation of these interim condensed financial statements was 30 June 2016 (2015: 30 June 2015).
9
For the six months period ended 30 June 2016 together with the Review Report to the Unitholders
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) INTERIM CONDENSED BALANCE SHEET (UN-AUDITED) As at 30 June 2016 (Amounts in SAR) Note
2016
2015
70,569,636 1,168,473,676 47,636,309 2,513 1,286,682,134
146,879,663 1,583,572,015 7,688,260 -1,738,139,938
527,700 25,055 215,831 768,586
706,582 43,020 161,213 910,815
1,285,913,548
1,737,229,123
88,356,329
120,870,578
14.5537
14.3726
ASSETS Cash at bank Investments Other receivables Prepaid Expenses Total assets
6 7
LIABILITIES Fund management fee payable Accrued expenses Other liabilities Total liabilities
8, 9 11
Net assets attributable to the Unitholders Units in issue (numbers) Net asset value – per unit
The accompanying notes 1 to 14 form an integral part of these interim condensed financial statements. The interim condensed financial statements appearing from page 1 to 10 were approved by the Fund Manager (as per the terms and conditions of the Fund) on 14th August 2016.
1
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) INTERIM CONDENSED STATEMENT OF INCOME (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) Note
2016
2015
8,661,566 5,500,029 (314,954)
6,056,354 4,229,729 (668,724)
(29,431) 13,817,210
(30,112) 9,587,247
(3,366,285) (35,951) (3,402,236) 10,414,974
(3,966,883) (43,020) (4,009,903) 5,577,344
INCOME Income on shari’a compliant placements Income on sukuks Amortisation of (premium) / discount on sukuks Amortisation of derivatives EXPENSES 8, 9 10
Fund management fee Other expenses NET INCOME FOR THE PERIOD
The accompanying notes 1 to 14 form an integral part of these interim condensed financial statements.
2
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) INTERIM CONDENSED STATEMENT OF CASH FLOWS (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) 2016
2015
CASH FLOWS FROM OPERATING ACTIVITIES Net income for the period
10,414,974
5,577,344
Adjustments to reconcile net income to net cash used in operating activities: Amortisation of premium
314,954
668,724
Changes in operating assets and liabilities Shari’a compliant placements Sukuks Other receivables Prepaid Expenses Fund management fee payable Accrued expenses Other liabilities Net cash generated from / (used in) operating activities
161,700,000 41,000,000 (39,152,013) (2,513) (62,984) (41,859) 29,431 174,199,990
(400,800,000) (172,309,575) (2,013,166) -211,322 (14,716) 30,112 (568,649,955)
CASH FLOWS FROM FINANCING ACTIVITIES Repayment of Borrowing Proceeds from issuance of units Payments for redemption of units Net cash (used in) / generated from financing activities
(790,011) 317,388,773 (420,340,361) (103,741,599)
-989,705,317 (397,489,389) 592,215,928
70,458,391 111,245 70,569,636
23,565,973 123,313,690 146,879,663
Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the period Cash and cash equivalents at the end of the period
The accompanying notes 1 to 14 form an integral part of these interim condensed financial statements.
3
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) INTERIM CONDENSED STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO THE UNITHOLDERS (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) 2016
2015
1,378,450,162
1,139,435,851
10,414,974
5,577,344
317,388,773
989,705,317
Payments for redemption of units Net change from unit transactions
(420,340,361) (102,951,588)
(397,489,389) 592,215,928
Net assets attributable to the Unitholders at the end of the period as at 30 June
1,285,913,548
1,737,229,123
Net assets attributable to the Unitholders at the beginning of the period as at 1 Jan Net income for the period Changes from unit transactions Proceeds from issuance of units
UNIT TRANSACTIONS
Units at the beginning of the period as at 1 January Units issued Units redeemed Net change in units Units at the end of the period as at 30 June
2016 2015 (In numbers) 95,454,924 79,553,305 21,934,922 (29,033,517) (7,098,595) 88,356,329
69,015,688 (27,698,415) 41,317,273 120,870,578
The accompanying notes 1 to 14 form an integral part of interim condensed financial statements.
4
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) INTERIM CONDENSED STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO THE UNITHOLDERS (UN-AUDITED) For the six months period ended 30 June 2016 1.
THE FUND AND ITS ACTIVITIES Al Badr Murabaha Fund Saudi Riyal (the “Fund”) is an open ended Saudi Riyal denominated investment fund based on an agreement between Saudi Fransi Capital (the “Fund Manager”) and investors (the “Unitholders”). The Fund commenced its operations on 1 September 1999. Al Badr Fund is a shari’ah compliant fund that has the objective of providing capital preservation and liquidity. The Fund invests in shari’ah compliant money market instruments and sukuks. The Fund is an income accumulation fund, whereby net income is reinvested in the Fund and is not distributed as dividend on the units. The Fund has updated their terms and conditions which have been approved by the CMA on 24 Sha’ aban 1436H (corresponding to 11 June 2015). The Fund Manager and Custodian of the Fund is Saudi Fransi Capital.
2.
REGULATORY AUTHORITY The Fund is governed by the Investment Fund Regulations (the “Regulations”) published by CMA on 3 Dhul Hijja 1427H (corresponding to 24 December 2006) detailing requirements for all funds within the Kingdom of Saudi Arabia.
3.
SUBSCRIPTION / REDEMPTION OF UNITS The Fund is open for subscriptions / redemptions with a cutoff time of 12:00 pm on every business day. The net asset attributable to the Unitholders of the Fund’s portfolio is determined on every business day (each a “Dealing day”). The net asset attributable to the Unitholders of the Fund for the purpose of subscription / redemption of units is determined by dividing the net assets of the Fund (book value of the Fund’s assets minus the Fund’s liabilities) by the total number of the Fund’s units outstanding on the relevant dealing day.
4.
BASIS OF PREPARATION
4.1
Statement of compliance These financial statements have been presented in accordance with the requirements of the accounting standards on financial reporting issued by the Saudi Organization of Certified Public Accountants (SOCPA). These interim financial statements have been presented in condensed form and do not include all the information presented in annual financial statements of the Fund; therefore, these interim condensed financial statements should be read in conjunction with the annual financial statements of the Fund for the year ended 31 December 2015. Certain prior period figures have been reclassified to conform with the current period presentation. These interim condensed financial statements does not necessarily constitutes an indication of the year end financial results.
4.2
Basis of measurement These interim condensed financial statements have been prepared under the historical cost convention using the accrual basis of accounting and the going concern concept. These interim condensed consolidated financial statements does not necessarily constitute an indication of the year-end financial results.
5
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) 4.
BASIS OF PREPARATION (CONTINUED)
4.3
Functional and presentation currency These financial statements have been presented in Saudi Riyal, which is also the functional currency of the Fund. All financial information presented has been rounded to the nearest Saudi Riyal (SAR).
4.4
Use of estimates and judgments In the ordinary course of business, the preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expense. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimates are revised and on prospective basis.
5.
SIGNIFICANT ACCOUNTING AND RISK MANAGEMENT POLICIES The significant accounting policies used in the preparation of these interim condensed financial statements and risk management policies are consistent with those used and disclosed in the annual financial statements for the year ended 31 December 2015.
6.
6.1
INVESTMENTS HELD TO MATURITY
Held to maturity Shari’a compliant placements Sukuks held at amortised cost Available for Sales Sukuks
2016
2015
6.1 6.2
838,600,000 238,631,471 1,077,231,471
1,205,200,000 286,914,661 1,492,114,661
6.3
91,242,205 1,168,473,676
91,457,354 1,583,572,015
Shari’a compliant placements The composition of Shari’a compliant placements by maturity as at each period end is set out below: 30 June 2016 Maturity
% of value
Up to 1 month 1-3 months 3-6 months 6-9 months 9-12 months
6
Cost SAR
13.19% 19.32% 37.94% 11.15% 18.4%
110,600,000 162,000,000 318,200,000 93,500,000 154,300,000
100.00%
838,600,000
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) 6.
INVESTMENTS (CONTINUED) 30 June 2015 Maturity
% of value
Up to 1 month 1-3 months 3-6 months 6-9 months 9-12 months
6.2
12.03% 16.40% 32.32% 27.72% 11.53% 100.00%
Cost SAR 145,000,000 197,700,000 389,500,000 334,000,000 139,000,000 1,205,200,000
Sukuks held at amortised cost 2016 242,274,238 (3,642,767) 238,631,471
Nominal amount Premium Sukuks at amortised cost
2015 289,336,400 (2,421,739) 286,914,661
Sukuks carries either a fixed rate or a floating commission rate plus margin. The composition of sukuks by maturity as at each period end is set out below: Carrying value Maturity Up to 1 year 1-2 years 2-3 years 3-4 years 4-5 years 6.3
2016
2015
55,083,994 -91,006,824 42,540,651 50,000,000
130,176,653 59,885,440 55,000,000 41,852,568 --
238,631,471
286,914,661
2016
2015
91,759,143 (516,938) 91,242,205
91,759,143 (301,789)
Sukuks – Available for sales Nominal amount Premium Sukuks at amortised cost
91,457,354
Available for sale investment consist of Sukuks carrying a floating rate plus margin. There is no active market available for sukuk and in the absence of market indicators cost is considered a reliable measure of the fair value of the sukuk. The fair value of the above sukuk approximates its par value; therefore, no reserve is created against these investments. The composition and residual maturities of Sukuks as at period end is set out below: Carrying value 2015 Maturity 2016 Up to 1 year 2-3 years 3-4 years
13,825,340 77,416,865 -91,242,205
7
-13,854,877 77,602,477 91,457,354
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS (UN-AUDITED) For the six months period ended 30 June 2016 (Amounts in SAR) 7.
OTHER RECEIVABLES
Accrued commission income on shari’a compliant murabaha placements Proceeds Outstanding from Maturity of Sukuk Accrued commission income on sukuk
8.
2016
2015
8,133,520 37,000,000 2,502,789 47,636,309
5,803,845 -1,884,415 7,688,260
TRANSACTIONS WITH RELATED PARTIES Saudi Fransi Capital (the “Fund Manager”), Banque Saudi Fransi (the “Bank” and the shareholder of the Fund Manager), affiliates of the Fund Manager and other funds managed by the Fund Manager are related parties. In the ordinary course of its activities, the Fund transacts business with related parties. The related party transactions are governed by limits set by the regulations issued by CMA. All the related party transactions are approved by the Fund Board. At the end of the period, cash balance with the Bank amounted to SR 70.57 million (30 June 2015: SR 146.88 million). Amount of transaction during the period 2015 2016
Name of related party
Nature of transaction
Saudi Fransi Capital Banque Saudi Fransi Board of Directors
Management fee Wa’ad contracts Annual remuneration
3,366,285 29,431 12,153
3,966,883 30,112 25,141
Closing balance 2015 2016 527,700 215,831 3,744
706,582 161,213 25,141
The units in issue at 30 June 2016 include units held by the employees of Banque Saudi Fransi and Saudi Fransi Capital: 74,833 units (30 June 2015: 1,260 units). The units in issue at 30 June 2016 include units held by Allianz Saudi Fransi of 14,709,716 units (30 June 2015: 13,762,238 units). 9.
FUND MANAGEMENT FEES AND OTHER CHARGES The Fund pays a management fee calculated at an annual rate of 0.5% of the net asset value. This is accrued daily and paid on a monthly basis. The Fund Manager also recovers from the Fund any other expenses incurred on behalf of the Fund such as audit fee, board compensation and other similar charges.
10.
OTHER EXPENSES 2016 (12,153) (23,798) (35,951)
Professional fees Fund board fees
8
2015 (17,879) (25,141) (43,020)
AL BADR MURABAHA FUND (SAR) An Open-Ended Mutual Fund (MANAGED BY SAUDI FRANSI CAPITAL) NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS (UN-AUDITED) For the six month period ended 30 June 2016 11.
COMMITMENTS Derivative Commitments In hedging certain foreign currency investments, the Fund has entered into forward exchange contracts (Wa’ad). The analysis of derivative financial instruments and the related fair value gain / (loss) values together with the notional amounts classified by the term to maturity is as follows: Fair value gain / (loss)
12.
Notional amount
Less than 1 Year
1-3 Year
30 June 2016 Forward foreign exchange contracts
215,831
54,892,500
--
54,892,500
Total
215,831
54,892,500
--
54,892,500
30 June 2015 Forward foreign exchange contracts
161,213
56,767,500
--
56,767,500
Total
161,213
56,767,500
--
56,767,500
FAIR VALUES OF FINANCIAL INSTRUMENTS Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial instruments comprise financial assets and financial liabilities. The Fund’s financial assets comprise of bank balance, investments held to maturity and other receivables, and its financial liabilities comprise of fund management fee payable, accrued expenses and other liabilities. The fair values of financial instruments are not materially different from their carrying values.
13.
SUBSCRIPTION REQUEST The Fund has received subscription requests as of 30 June 2016, amounting to SAR 69,251 (30 June 2015: 283,946) after the cutoff time and hence issued units subsequent to period end
14.
LAST VALUATION DAY In accordance with terms and conditions of the Fund, the last valuation date of the period was 30 June 2016 (2015: 30 June 2015). The last valuation date for the purpose of preparation of these interim condensed financial statements was 30 June 2016 (2015: 30 June 2015).
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