Al Johar Saudi Equity Sharia Committee Standards Compliant Fund ...
Al Oula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia —
Auditors’ Limited Review Report and Interim Financial Statements for the Six Months Period Ended 30 June 2016 (Unaudited)
Al Oula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia —
Index Page
Exhibit
Auditors’ Limited Review Report
1
Interim Statement of Financial Position as of3O June 2016 (Unaudited)
2
A
Interim Statement of Income for the Six Months Period Ended 30 June 2016 (Unaudited)
3
B
Interim Statement of Cash Flow for the Six Months Period Ended 30 June 2016 (Unaudited)
4
C
Interim Statement of Changes in Net Assets Attributable to Unitholders for the Six Months Period Ended 30 June 2016 (Unaudited)
5
D
Notes to the Interim Financial Statements for the Six Months Period Ended 30 June 2016 (Unaudited)
6-9
a
Talal Abu—Ghazaleh & Co.
Certified PublicAccountants
.-tniIvIo
LicenseNo.323111/81 DatedSl7/1416
UM/tIrlr
lIj
The JJnitholders of Al Oula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia —
Auditors’ Limited Review Report Scope of Review: We have reviewed the accompanying interim statement of financial position of Al Oula Geojit— Al Johar Saudi Equity Sharia Committee Standards Compliant Fund (the “Fund”) managed by Al Oula Geojit Capital Company (the “Fund Manager”) as of 30 June 2016 and the related interim statements of income, cash flow and changes in net assets attributable to unitholders for the six months period then ended. These interim financial statements are the responsibility of the Fund Manager who has prepared and submitted them to us alone with all the information requested. We conducted our limited review in accordance with the Standard on Review of Interim Financial Reporting set forth by the Saudi Organization for Certified Public Accountants (SOCPA). A limited review consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion on the financial statements; therefore, we do not express such opinion. Conclusion: Based on our review, we are not aware of any material modifications that should be made to the
accompanying interim financial statements in order for them to be in conformity with accounting standards generally accepted in the Kingdom of Saudi Arabia. ForTalal Abu-Ghazaleh & Co. —
Iced A. Bamarouf Certified Public Accountant License No. 408 04 Dhu Al-Qadnh 1437 H. 07 August 2016 C.
Olaya Main St. Beside Ministry of Interior, Tel.: ÷96611 464 2936 Fax: +966114659915 P.O.Box: 9767. Riyadh 11423 Saudi Arabia
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www.tagi.com [email protected]
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Al Oula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Interim Statement of Financial Position As of 30 June 2016 (Unaudited) —
Exhibit A Note
Assets Cash and cash equivalents Investments held for trading Other current assets Total Assets
(6)
Liabilities Accrued expenses and others Due to fund manager Total Liabilities Net Assets Attributable to Unitholders
(9) —
Exhibit D
Units in issue (numbers) Net assets attributable to each unit (SR)
(7)
2016 SR.
2015 SR.
2,621,097 6,496,738 2,520 9,120,355
22,708,352 8,426,085 2,869 31,137,306
—
90,265 44,595 134,860 8,985,495
34,350 57,748 92,098 31,045,208
1,810,785 4.96
3.223,082 9.63
The Accompanying Notes from (1) to (13) Constitute an Integral Part of These Interim Financial Statements
-2-
Al ()ula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Interim Statement of Income For the Six Months Period Ended 30 June 2016 (Unaudited) —
Exhibit B Note
For six months period ended 30
June
2016 SR. Income Realized (loss) on disposal of investments held for trading Unrealized (loss) / gain on revaluation of investments held for trading Dividend income Gross (loss) for the period Expenses Management fees Administration fees Custody fees Other expenses Total expenses for the period Net (Loss) For The Period Exhibit D
(1,049,988) (659,563) 109,164 (1,600,387)
(8) (8) (8)
—
(77,004) (5,134) (6,161) (45,952) (134,251) (1,734,638)
The Accompanying Notes from (1) to (13) Constitute an Integral Part of These Interim Financial Statements
-J
-
2015 SR.
—
(674.878) 286,653 29,303 (358,922)
(56,613) (3,775) (4,530) (50,404) (115,322) (474,244)
Al Oula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Interim Statement of Cash Flow For the Six Months Period Ended 30 June 2016 (Unaudited) —
Exhibit C For the six months period ended_30_June 2016 2015 SR. SR.
Cash Flow from Operating Activities Net (loss) for the period
(1,734,638)
(474.244)
659,563
(286,653)
Changes in Operating Assets and Liabilities Investments held for trading Investment in IPO Other current assets Accrued expenses and others Due to fund manager
(3,648,451) 232,830 (2,520) 36,761 (15,640)
(6,920,391)
Net cash (used in) operating activities
(4,472,095)
(7,623,783)
Cash Flow from Financing Activities Proceeds from issuance of units Payments against redemption of units
(1,659,999)
Net cash (used in)! from financing activities
(1,659,999)
29,924,024
Net (decrease) / increase in cash and cash equivalents Cash and cash equivalents, beginning of the period Cash and Cash Equivalents, End of the Period Exhibit A
(6,132,094) 8,753,191 2,621,097
22,300,241 408,111 22,708,352
Adjustment for: Unrealized loss / (gain) on revaluation of investments held for trading
--
6,090 2,563 48,852
29,924,024
—
The Accompanying Notes from (1) to (13) Constitute an Integral Part of These Interim Financial Statements
.4..
Al ()ula (eojit .41 Joha r Saudi Eq uity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Interim Statement of Changes in Net Assets Attributable to Unitholciers For the Six Months Period Ended 30 June 2016 (Unaudited) —
Exhibit D For the period ended 30 June 2016
SR. 12,380,132
Net Assets Attributable to Unitholders at Beginning of the Period
Net (loss) for the period Total
—
Exhibit B
-
(1,734,638)
10,645,494
Changes from unit transactions: Proceeds from issuance of units Payment against redemption of units Net Assets Attributable to Unitholders at End of the Period
2015 SR. 1,595,428 (474.244) 12 1, 1 84 29,924,024
(1,659,999) —
Exhibit A
8,985,495
The Accompanying Notes from (1) to (13) Constitute an Integral Part of These Interim Financial Statements
-5-
31,045,208
Al Oula Ceojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Notes to the Interim Financial Statements For the Six Months Period Ended 30 June 2016 (Unaudited) —
1-.
The Fund and Its Activities: Al Oula Geojit Al Johar Saudi Equtiy Sharia Committee Standards Compliant Fund (“the Fund”) is an open—elided mutual investment fund which is managed through an agreement between al Oula Geojit Capital Company (“the Fund Manager”) and the Investors (the Unitholders). The objective of the Fund is to seek capital growth by investing in a diversified portfolio of companies listed on Tadawul (Saudi equity market). over mediLim to long term period. All income is reinvested in the FLuid and is reflected iii the unit price. —
The Fund commenced its operation on 20 April 2014 (corresponding to 20 Jumada Al Akhir 1435H.) to meet the above mentioned objectives. 2-
Regulating Authority: The Fund is governed by the Investment Fund Regulations (“the Regulations”) issued by the Board of the Capital Market Authority (“CMA”) pursuant to its resolution number 1 -219-2006 dated 3 Dhul Hajjah l427H. corresponding to 24 December 2006 based on the Capital Market Law issued by Royal Decree No. M/30 dated 2 Jumada Al Akhir 1424 H. corresponding to 31 July 2003.
3-
Subscription I Redemption (Dealing Day & Valuation Day) Subscription / redemption requests will he accepted n all days on which the Tadawul is open. The value of the Fund’s portfolio is determined twice weekly on Monday and Wednesday (each being a “Valuation Day”). The net asset attributable to each unit of the Fund for the purpose of purchase or sale of units is determined by dividing the net value of assets by the total number of outstanding fund units on the relevant valuation day.
4-
Basis of Preparation: a)
Statement of Compliance: These interim financial statements have been prepared in accordance with the requirements of accounting standard n interim financial reporting issued by the Saudi Organization of Certified Public Accountants (the “SOCPA”).
b)
Basis of Measurement: These interim financial statements have been prepared under the historical cost convention, except for the investments held for trading that are measured at fair value, using accrual basis of accounting and the going concern concept.
c)
Functional and Presentation Currency: These interim financial statements are presented in Saudi Arabian Riyals (SR) which is the functional currency of the Fund.
d)
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 expenses. 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 period in which the estimates are revised and in future periods affected.
-6-
Al Oula Ceojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Notes to the Interim Financial Statements For the Six Months Period Ended 30 June 2016 (Unaudited) —
5-
Significant Accounting Policies: The significant accounting policies used in these interim financial statements are consistent with those used and disclosed in the Fund’s annual financial statements for the year ended 31 December 2015. These interim financial statements do not include all the information presented in full set of annual financial statements; therefore, these interim financial statements should be read in conjunction with the full set of annual financial statements for the year ended 31 December 2015. The interim results of the Fund are not necessarily indicative of results for the full year.
6-
Investments Held for Trading: The investments held for trading comprise of investment in shares of diversified portfolio of companies. The sector-wise composition of investments held for trading is summarized as follows: 2016 SR. Hotel and tourism Petrochemical industries Banks Industry Travel Real estate development Cement Retail Telecommunication and information technology Service industries Others Total Exhibit A
811,600 1,053,700 300,468 1,009,120 1,330,350 1,025,100 966,400 --
6,496,738
—
2015 SR. 67,388 1,471,690 --
--
--
2,162,300 708,572 --
I ,202,68 8 2,702,679 110,768 8,426,085
As at 30 June 2016 cost of the above mentioned investments held for trading amounted to SR. 7,156,301 (30 June 2015: SR. 8,139,432). 7-
Unit Transactions: The transactions in units for the period are summarized as follows: 30 June 2016 Units 2,148,933
Units at beginning of the period Units issued during the period Units
redeemed
during
the
Units at end of the period
8-
--
(338,148) 1,810,785
period
—
Exhibit A
30 June 2015 Units 184,308 3,038,774 --
3,223,082
Management Fee, Custodian and Fund Administration Fees and Sundry Expenses: The Fund Manager charges to the Fund on each Valuation Day, management fee at a rate of 1 .5% per annum of the Fund’s net assets value. The Fund Manager also recovers from the Fund any other expenses incurred on behalf of the Fund including custodian and fund administration fee, audit fee, board compensation and other similar charges. These charges. in total, are not expected to exceed the limit as mentioned in the terms and conditions of the Fund.
-7-
Al Oula Ceojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Notes to the Interim Financial Statements For the Six Months Period Ended 30 June 2016 (Unaudited) —
9-
Transactions and Balances With Related Parties: Related parties of the Fund include unitholders, the Fund Manager and other funds managed by the Fund manager. All transactions with related parties are carried out on mutually agreed prices under formal agreement. Related party transactions for the period are as under: Related party
Nature of transactions
Transaction amounts For the period period ended 30 June 2015 ended 30 June 2016 SR. SR. For the
Al Oula Geojit Capital Company (Fund Manager)
Jamal Johar Mohammad Al-Johar (Related party with Fund Manager)
Fund management Fee and Administration fee Custody fees Payments against redemption of units Proceeds from issuance of units
82,138 6,161
1,659,999
The above transactions resulted in the following balance due to a related party
Al Oula Geojit Capital Company (Fund Manager)
10-
—
Exhibit A
60,389 4,530
29,924,024 fund manager:
2016 SR. 44,595
2015 SR. 57,748
Financial Risk Management: The Fund maintains position in financial instrument as dictated by its investment policy. All investments are “held for trading” investments. The Fund is exposed to the following risks: Credit Risk: Credit risk is a risk one party to a financial instrument may fail to discharge an obligation and cause the other party to incur a financial loss. The Fund is exposed to the credit risk on cash and cash equivalents which are maintained with the financial institutions with good credit rating. Thus the credit risk is not considered significant. Equity Price Risk: Equity price risk is the risk that the fair value of equity investments decreases as a result of changes in the levels of equity indices and the value of individual stocks. The Fund is exposed to equity price risk arising from its investments in shares. The Fund Manager endeavors to minimize the risk through diversification across various sectors of the Saudi stock markets. Further, the Fund Manager has established risk guidelines to manage its equity prices risk. Currency Risk: Currency risk is the risk that the value of a financial instrument may fluctuate due to a change in foreign exchange rates. The Fund is not subject to currency risk as all the assets and liabilities of the Fund are in Saudi Riyals.
-8-
Al Oula Geojit Al Joliar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Notes to the Interim Financial Statements For the Six Months Period Ended 30 June 2016 (Unaudited) 11-
Fair Values of Financial Instruments: Fair value is the amount for which an asset could he exchanged. or a liability settled between knowledgeable willing parties in an arm’s length transaction. Financial instruments comprise financial assets and financial liabilities. The Fund’s financial assets comprise of bank balance and investments held for trading and its financial liabilities comprise of expenses payable. Investment held for trading are carried at fair values. The fair values of other financial instruments are not materially different from their carrying values.
12-
Last Valuation Day: The last valuation day of the period was 30 June 2016.
13-
Approval of the Interim Financial Statements: These interim financial statements were approved by the Fund Board on 04 Dhu Al-Qadah l437H. corresponding to 07 August 20 16G.
-9-
Auditors’ Limited Review Report and Interim Financial Statements for the Six Months Period Ended 30 June 2016 (Unaudited)
Al Oula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia —
Index Page
Exhibit
Auditors’ Limited Review Report
1
Interim Statement of Financial Position as of3O June 2016 (Unaudited)
2
A
Interim Statement of Income for the Six Months Period Ended 30 June 2016 (Unaudited)
3
B
Interim Statement of Cash Flow for the Six Months Period Ended 30 June 2016 (Unaudited)
4
C
Interim Statement of Changes in Net Assets Attributable to Unitholders for the Six Months Period Ended 30 June 2016 (Unaudited)
5
D
Notes to the Interim Financial Statements for the Six Months Period Ended 30 June 2016 (Unaudited)
6-9
a
Talal Abu—Ghazaleh & Co.
Certified PublicAccountants
.-tniIvIo
LicenseNo.323111/81 DatedSl7/1416
UM/tIrlr
lIj
The JJnitholders of Al Oula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia —
Auditors’ Limited Review Report Scope of Review: We have reviewed the accompanying interim statement of financial position of Al Oula Geojit— Al Johar Saudi Equity Sharia Committee Standards Compliant Fund (the “Fund”) managed by Al Oula Geojit Capital Company (the “Fund Manager”) as of 30 June 2016 and the related interim statements of income, cash flow and changes in net assets attributable to unitholders for the six months period then ended. These interim financial statements are the responsibility of the Fund Manager who has prepared and submitted them to us alone with all the information requested. We conducted our limited review in accordance with the Standard on Review of Interim Financial Reporting set forth by the Saudi Organization for Certified Public Accountants (SOCPA). A limited review consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion on the financial statements; therefore, we do not express such opinion. Conclusion: Based on our review, we are not aware of any material modifications that should be made to the
accompanying interim financial statements in order for them to be in conformity with accounting standards generally accepted in the Kingdom of Saudi Arabia. ForTalal Abu-Ghazaleh & Co. —
Iced A. Bamarouf Certified Public Accountant License No. 408 04 Dhu Al-Qadnh 1437 H. 07 August 2016 C.
Olaya Main St. Beside Ministry of Interior, Tel.: ÷96611 464 2936 Fax: +966114659915 P.O.Box: 9767. Riyadh 11423 Saudi Arabia
jI 3 l
-
www.tagi.com [email protected]
-
,LJi LdaiI
ttt
.
-
‘ t V ?ltI VtV
Al Oula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Interim Statement of Financial Position As of 30 June 2016 (Unaudited) —
Exhibit A Note
Assets Cash and cash equivalents Investments held for trading Other current assets Total Assets
(6)
Liabilities Accrued expenses and others Due to fund manager Total Liabilities Net Assets Attributable to Unitholders
(9) —
Exhibit D
Units in issue (numbers) Net assets attributable to each unit (SR)
(7)
2016 SR.
2015 SR.
2,621,097 6,496,738 2,520 9,120,355
22,708,352 8,426,085 2,869 31,137,306
—
90,265 44,595 134,860 8,985,495
34,350 57,748 92,098 31,045,208
1,810,785 4.96
3.223,082 9.63
The Accompanying Notes from (1) to (13) Constitute an Integral Part of These Interim Financial Statements
-2-
Al ()ula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Interim Statement of Income For the Six Months Period Ended 30 June 2016 (Unaudited) —
Exhibit B Note
For six months period ended 30
June
2016 SR. Income Realized (loss) on disposal of investments held for trading Unrealized (loss) / gain on revaluation of investments held for trading Dividend income Gross (loss) for the period Expenses Management fees Administration fees Custody fees Other expenses Total expenses for the period Net (Loss) For The Period Exhibit D
(1,049,988) (659,563) 109,164 (1,600,387)
(8) (8) (8)
—
(77,004) (5,134) (6,161) (45,952) (134,251) (1,734,638)
The Accompanying Notes from (1) to (13) Constitute an Integral Part of These Interim Financial Statements
-J
-
2015 SR.
—
(674.878) 286,653 29,303 (358,922)
(56,613) (3,775) (4,530) (50,404) (115,322) (474,244)
Al Oula Geojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Interim Statement of Cash Flow For the Six Months Period Ended 30 June 2016 (Unaudited) —
Exhibit C For the six months period ended_30_June 2016 2015 SR. SR.
Cash Flow from Operating Activities Net (loss) for the period
(1,734,638)
(474.244)
659,563
(286,653)
Changes in Operating Assets and Liabilities Investments held for trading Investment in IPO Other current assets Accrued expenses and others Due to fund manager
(3,648,451) 232,830 (2,520) 36,761 (15,640)
(6,920,391)
Net cash (used in) operating activities
(4,472,095)
(7,623,783)
Cash Flow from Financing Activities Proceeds from issuance of units Payments against redemption of units
(1,659,999)
Net cash (used in)! from financing activities
(1,659,999)
29,924,024
Net (decrease) / increase in cash and cash equivalents Cash and cash equivalents, beginning of the period Cash and Cash Equivalents, End of the Period Exhibit A
(6,132,094) 8,753,191 2,621,097
22,300,241 408,111 22,708,352
Adjustment for: Unrealized loss / (gain) on revaluation of investments held for trading
--
6,090 2,563 48,852
29,924,024
—
The Accompanying Notes from (1) to (13) Constitute an Integral Part of These Interim Financial Statements
.4..
Al ()ula (eojit .41 Joha r Saudi Eq uity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Interim Statement of Changes in Net Assets Attributable to Unitholciers For the Six Months Period Ended 30 June 2016 (Unaudited) —
Exhibit D For the period ended 30 June 2016
SR. 12,380,132
Net Assets Attributable to Unitholders at Beginning of the Period
Net (loss) for the period Total
—
Exhibit B
-
(1,734,638)
10,645,494
Changes from unit transactions: Proceeds from issuance of units Payment against redemption of units Net Assets Attributable to Unitholders at End of the Period
2015 SR. 1,595,428 (474.244) 12 1, 1 84 29,924,024
(1,659,999) —
Exhibit A
8,985,495
The Accompanying Notes from (1) to (13) Constitute an Integral Part of These Interim Financial Statements
-5-
31,045,208
Al Oula Ceojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Notes to the Interim Financial Statements For the Six Months Period Ended 30 June 2016 (Unaudited) —
1-.
The Fund and Its Activities: Al Oula Geojit Al Johar Saudi Equtiy Sharia Committee Standards Compliant Fund (“the Fund”) is an open—elided mutual investment fund which is managed through an agreement between al Oula Geojit Capital Company (“the Fund Manager”) and the Investors (the Unitholders). The objective of the Fund is to seek capital growth by investing in a diversified portfolio of companies listed on Tadawul (Saudi equity market). over mediLim to long term period. All income is reinvested in the FLuid and is reflected iii the unit price. —
The Fund commenced its operation on 20 April 2014 (corresponding to 20 Jumada Al Akhir 1435H.) to meet the above mentioned objectives. 2-
Regulating Authority: The Fund is governed by the Investment Fund Regulations (“the Regulations”) issued by the Board of the Capital Market Authority (“CMA”) pursuant to its resolution number 1 -219-2006 dated 3 Dhul Hajjah l427H. corresponding to 24 December 2006 based on the Capital Market Law issued by Royal Decree No. M/30 dated 2 Jumada Al Akhir 1424 H. corresponding to 31 July 2003.
3-
Subscription I Redemption (Dealing Day & Valuation Day) Subscription / redemption requests will he accepted n all days on which the Tadawul is open. The value of the Fund’s portfolio is determined twice weekly on Monday and Wednesday (each being a “Valuation Day”). The net asset attributable to each unit of the Fund for the purpose of purchase or sale of units is determined by dividing the net value of assets by the total number of outstanding fund units on the relevant valuation day.
4-
Basis of Preparation: a)
Statement of Compliance: These interim financial statements have been prepared in accordance with the requirements of accounting standard n interim financial reporting issued by the Saudi Organization of Certified Public Accountants (the “SOCPA”).
b)
Basis of Measurement: These interim financial statements have been prepared under the historical cost convention, except for the investments held for trading that are measured at fair value, using accrual basis of accounting and the going concern concept.
c)
Functional and Presentation Currency: These interim financial statements are presented in Saudi Arabian Riyals (SR) which is the functional currency of the Fund.
d)
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 expenses. 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 period in which the estimates are revised and in future periods affected.
-6-
Al Oula Ceojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Notes to the Interim Financial Statements For the Six Months Period Ended 30 June 2016 (Unaudited) —
5-
Significant Accounting Policies: The significant accounting policies used in these interim financial statements are consistent with those used and disclosed in the Fund’s annual financial statements for the year ended 31 December 2015. These interim financial statements do not include all the information presented in full set of annual financial statements; therefore, these interim financial statements should be read in conjunction with the full set of annual financial statements for the year ended 31 December 2015. The interim results of the Fund are not necessarily indicative of results for the full year.
6-
Investments Held for Trading: The investments held for trading comprise of investment in shares of diversified portfolio of companies. The sector-wise composition of investments held for trading is summarized as follows: 2016 SR. Hotel and tourism Petrochemical industries Banks Industry Travel Real estate development Cement Retail Telecommunication and information technology Service industries Others Total Exhibit A
811,600 1,053,700 300,468 1,009,120 1,330,350 1,025,100 966,400 --
6,496,738
—
2015 SR. 67,388 1,471,690 --
--
--
2,162,300 708,572 --
I ,202,68 8 2,702,679 110,768 8,426,085
As at 30 June 2016 cost of the above mentioned investments held for trading amounted to SR. 7,156,301 (30 June 2015: SR. 8,139,432). 7-
Unit Transactions: The transactions in units for the period are summarized as follows: 30 June 2016 Units 2,148,933
Units at beginning of the period Units issued during the period Units
redeemed
during
the
Units at end of the period
8-
--
(338,148) 1,810,785
period
—
Exhibit A
30 June 2015 Units 184,308 3,038,774 --
3,223,082
Management Fee, Custodian and Fund Administration Fees and Sundry Expenses: The Fund Manager charges to the Fund on each Valuation Day, management fee at a rate of 1 .5% per annum of the Fund’s net assets value. The Fund Manager also recovers from the Fund any other expenses incurred on behalf of the Fund including custodian and fund administration fee, audit fee, board compensation and other similar charges. These charges. in total, are not expected to exceed the limit as mentioned in the terms and conditions of the Fund.
-7-
Al Oula Ceojit Al Johar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Notes to the Interim Financial Statements For the Six Months Period Ended 30 June 2016 (Unaudited) —
9-
Transactions and Balances With Related Parties: Related parties of the Fund include unitholders, the Fund Manager and other funds managed by the Fund manager. All transactions with related parties are carried out on mutually agreed prices under formal agreement. Related party transactions for the period are as under: Related party
Nature of transactions
Transaction amounts For the period period ended 30 June 2015 ended 30 June 2016 SR. SR. For the
Al Oula Geojit Capital Company (Fund Manager)
Jamal Johar Mohammad Al-Johar (Related party with Fund Manager)
Fund management Fee and Administration fee Custody fees Payments against redemption of units Proceeds from issuance of units
82,138 6,161
1,659,999
The above transactions resulted in the following balance due to a related party
Al Oula Geojit Capital Company (Fund Manager)
10-
—
Exhibit A
60,389 4,530
29,924,024 fund manager:
2016 SR. 44,595
2015 SR. 57,748
Financial Risk Management: The Fund maintains position in financial instrument as dictated by its investment policy. All investments are “held for trading” investments. The Fund is exposed to the following risks: Credit Risk: Credit risk is a risk one party to a financial instrument may fail to discharge an obligation and cause the other party to incur a financial loss. The Fund is exposed to the credit risk on cash and cash equivalents which are maintained with the financial institutions with good credit rating. Thus the credit risk is not considered significant. Equity Price Risk: Equity price risk is the risk that the fair value of equity investments decreases as a result of changes in the levels of equity indices and the value of individual stocks. The Fund is exposed to equity price risk arising from its investments in shares. The Fund Manager endeavors to minimize the risk through diversification across various sectors of the Saudi stock markets. Further, the Fund Manager has established risk guidelines to manage its equity prices risk. Currency Risk: Currency risk is the risk that the value of a financial instrument may fluctuate due to a change in foreign exchange rates. The Fund is not subject to currency risk as all the assets and liabilities of the Fund are in Saudi Riyals.
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Al Oula Geojit Al Joliar Saudi Equity Sharia Committee Standards Compliant Fund Managed by Al Oula Geojit Capital Company Kingdom of Saudi Arabia Notes to the Interim Financial Statements For the Six Months Period Ended 30 June 2016 (Unaudited) 11-
Fair Values of Financial Instruments: Fair value is the amount for which an asset could he exchanged. or a liability settled between knowledgeable willing parties in an arm’s length transaction. Financial instruments comprise financial assets and financial liabilities. The Fund’s financial assets comprise of bank balance and investments held for trading and its financial liabilities comprise of expenses payable. Investment held for trading are carried at fair values. The fair values of other financial instruments are not materially different from their carrying values.
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Last Valuation Day: The last valuation day of the period was 30 June 2016.
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Approval of the Interim Financial Statements: These interim financial statements were approved by the Fund Board on 04 Dhu Al-Qadah l437H. corresponding to 07 August 20 16G.
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