Home' Trinidad and Tobago Guardian : October 21st 2015 Contents B19
The Paria Fund
30 June 2015
8. Related Party Transactions
Parties are considered to be related if one party has the ability to control the other party or exercise
significant influence over the other party in making financial or operational decisions.
The Investment Manager of the Fund is entitled to a maximum investment manager fee of 2.50%
per annum based on the average net asset value of the Fund. For the year ended June 30, 2015 the
Investment Manager accepted a fee return of 1.50% (2014: 1.40%) on the average net asset value
of the Fund. The management fee for the year ended June 30, 2015 totaled US$3,062,103 (2014:
US$2,678,173) of which US$248,839 (2014: US$267,411) was payable at the year end and included in
accrued expenses and other payables.
Trustee, Distribution and Administration Fees
The Trustee, Distributor and Administrator of the Fund is entitled to maximum fees of 0.25% per annum
based on the average net asset value of the Fund for each service. The fees payable and charged for year
ended June 30, 2015 are outlined in Notes 6 and 9 respectively.
Certain related parties acts as the bankers and partial investment custodian for the Fund with a business
relationship similar to that of non-related parties. The balance outstanding at the year-end along with
other related party transactions are detailed below.
Available-for-sale financial assets
Cash and cash equivalents
Due (to)/from related parties
Value of units held in the Fund
Distributions received during the year
The balance due from/(to) related parties is interest free and does not have a stated repayment date.
9. Administrative Expenses
Other operating expenses
10. Distributions to Unitholders
Average rate of return without reinvestment option
Annualised effective yield with the reinvestment option
Distributions are declared as outlined in Note 1. Distributions of US$1,734,238 were declared to
unitholders for the year ended June 30, 2015 (2014: US$1,785,893).
11. Financial Risks
11.1 Financial risk factors
The Fund's activities expose it to a variety of financial risks: market risk (including price risk,
currency risk, and interest rate risk), credit risk and liquidity risk.
The Fund is also exposed to operational risks such as custody risk. Custody risk is the risk of loss of
securities held in custody occasioned by the insolvency or negligence of the custodian. Although
an appropriate legal framework is in place that eliminates the risk of loss of value of the securities
held by the custodian, in the event of its failure, the ability of the Fund to transfer the securities
might be temporarily impaired.
The Fund's overall risk management programme seeks to maximise the returns derived for the
level of risk to which the Fund is exposed and seeks to minimise potential adverse effects on the
Fund's financial performance.
All securities investments present a risk of loss of capital. The maximum loss of capital on equity
and debt securities is limited to the fair value of those positions.
4. Available-For-Sale Financial Assets
Cost Fair values
Government debt securities
63,382,857 67,679,670 66,408,276 70,369,022
Corporate debt securities
102,410,697 103,887,707 68,484,139 70,684,634
Government agency securities
170,791,985 176,647,293 153,330,669 160,221,013
Movement during the year:
Balance brought forward
Net realised loss
Net change in unrealised (losses)/gains
Balance carried forward
5. Cash and Cash Equivalents
Bank current account
Short term deposits
6. Accrued Expenses and Other Payables
Management fees payable
Trustee fees payable
Distributor fees payable
Operating expenses accrued
7. Net Assets
Less: fair value reserve
Net assets attributable to unitholders
Number of units outstanding
Net value per unit based on net assets attributable to unitholders
Total equity represents the unitholders equity in the Fund which would be realised by the unitholders
in the event of the liquidation of the Fund. Net assets attributable to unitholders represents the value
of assets available to unitholders for daily redemptions in the normal course of business based on the
The fair value reserve and undistributed surplus represents the undistributed accumulated appreciation
on available-for-sale financial assets and accumulated operating gains of the Fund respectively and do
not form part of the amount available to unitholders for redemptions in the normal course of business.
The Trustee considers the fair value reserve to be distributable only when realised and based on the
discretional powers granted to it in the Fund's Trust Deed, does not consider the fair value reserve to be
available for immediate distribution.
(Expressed in United States Dollars)
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