HBOS Specialised Investment Funds ICVC

Transcription

1

2 Contents Introduction 1 Director's Report and Statement 2 Statement of the Authorised Corporate Director's (ACD's) Responsibilities 4 Aggregated Interim Financial Statements 5 Notes to the Aggregated Interim Financial Statements 7 Investment markets overview, Performance record, Portfolio statement and Financial statements: Cautious Managed Fund 8 Ethical Fund 44 Fund of Investment Trusts 54 Smaller Companies Fund 63 Special Situations Fund 74 Distribution Tables 85 Additional Information 88

3 Introduction We are pleased to present the for the HBOS Specialised Investment Funds ICVC ( the Company ) for the six month period ended 30 November The financial statements have been prepared on an aggregated basis including all Funds as permitted by the Financial Conduct Authority's (''the FCA'') Collective Investment Schemes sourcebook ( the COLL sourcebook ). As required by the COLL sourcebook, information for each of the five Funds has also been included. About the Company The HBOS Specialised Investment Funds ICVC is an Open-Ended Investment Company ( OEIC ) with variable capital incorporated in England and Wales since 27 September 2000 and authorised by the Financial Services Authority (which has since been succeeded by the Financial Conduct Authority the FCA ) with effect from 20 September The Company is managed by HBOS Investment Fund Managers Limited, the Authorised Corporate Director ( the ACD ), who is responsible for the day to day running of the Company including the preparation of interim and annual reports. The property of the Company is entrusted to State Street Trustees Limited ("the Depositary"). The objective of the Company is to invest the Scheme Property in transferable securities, money market instruments, cash and near cash, derivatives and forward transactions, deposits and units (as defined in the COLL sourcebook) of collective investment schemes in accordance with the COLL sourcebook with the aim of spreading investment risk and giving its shareholders the benefit of the results of the management of that property. The Shareholders have no interest in the scheme property, and are not liable for the debts of the Company. The Company is a UCITS scheme operating in accordance with the COLL sourcebook and is structured as an umbrella company, as defined in the Open-Ended Investment Company Regulations 2001 ( the OEIC Regulations ), in that it currently contains five Funds, each with different investment objectives. New Funds may be established from time to time by the ACD with the approval of the FCA. Within the financial statements there is an investment review for each Fund, which includes details of the investment objectives. The Cautious Managed Fund was launched on 6 April The following four Funds were launched on 3 November 2000 following the conversion of four existing unit trusts: Ethical Fund Fund of Investment Trusts Smaller Companies Fund Special Situations Fund 1

4 Director's Report and Statement Director's Report HBOS Investment Fund Managers Limited is the Authorised Corporate Director ( the ACD ) and Registrar for the HBOS Specialised Investment Funds ICVC. HBOS Investment Fund Managers Limited is authorised and regulated by the Financial Conduct Authority ( the FCA ). The ACD is the sole director. The HBOS Specialised Investment Funds ICVC is an Open-Ended Investment Company with variable capital under Regulation 12 (Authorisation) of the Open-Ended Investment Companies Regulations It is a UCITS retail scheme and is structured as an umbrella scheme with five Funds. The shareholders are not liable for any debts of the Company. As the Funds are not legal entities, if the assets attributable to any Fund were insufficient to meet the liabilities attributable to it, the shortfall might have to be met out of the assets attributable to one or more other Funds of the HBOS Specialised Investment Funds ICVC. The investment objective for each of the five Funds, together with the ACD's policy for achieving those objectives and a review of the investment activities during the period, is set out in the respective investment market overview in this report. During the period there have been a number of changes to the Company: These changes are detailed below in the section Prospectus changes. Prospectus changes During the period and up to the date of this report, the following changes were made to the Company and therefore the following changes were reflected in the Prospectus of HBOS Specialised Investment Funds ICVC: With effect from 1 October 2013, for certain share classes of the Scheme (as detailed below) the existing fee charges were changed to allow the fees of auditors, tax, legal and other professional advisors (the Expense) to be paid out of the Scheme property. For share classes A, Institutional and Scottish Widows Share Class 1 for all sub-funds of the Scheme, the ACD amended the Prospectus of the Scheme to allow it to pay the Expense out of the scheme property. The ACD has deemed it necessary to make the changes due to increasing costs associated with management of the Scheme where such costs are primarily incurred as a result of investing in and operating in certain overseas jurisdictions where filing of overseas tax returns and reclaims is required through agents in order to provide the optimum returns for the potential benefit of Shareholders in the Scheme. As a result, the costs will be aligned with the benefits accruing to the Scheme. With effect from 1 October 2013, the investment and borrowing powers of the Cautious Managed Fund were amended to allow for wider investment in other collective investment schemes (as notified to Shareholders in August 2013). The Cautious Managed Fund may now invest up to 20 the value of its scheme property in other regulated collective investment schemes. Under the FCA rules, the Cautious Managed Fund could be permitted to invest all of its scheme property in other collective investment schemes but, until this change, the Fund was restricted to investing only 10 its assets in this way. However, we believe that the Fund should take only the flexibility we view as being in the best interests of shareholders, considering the investment objective and policy of the Fund and so we raised the permitted level of investment to 20%. This change is not intended to have any impact on the risk profile of the Fund. A copy of the Prospectus is available on request. 2

5 Director's Report and Statement (continued) Important information Amendments to the UK Regulations governing Open-Ended Investment Companies and the *FCA s Collective Investment Schemes sourcebook which require limitation of liability between sub-funds of the Company came into effect on 21 December The new segregated liability regime is mandatory and it is our intention to apply to the FCA within the transitional period for approval to amend the Company s Prospectus and Instrument of Incorporation which will provide for this change. The transitional implementation period is open until 20 December *FSA was replaced by the Financial Conduct Authority (FCA) on 1 April In the future, the Company may launch further Funds. The ultimate parent undertaking of the ACD is Lloyds Banking Group plc. The statement of the ACD's Responsibilities is set out on page 4 of this report. The names and addresses of the ACD, the Depositary, the Investment Adviser, the Registrar and the Auditors can be found on page 88 of this report. Director's Statement In accordance with the rules in the Collective Investment Schemes sourcebook as issued and amended by the Financial Conduct Authority, I hereby approve the report and financial statements on behalf of the Authorised Corporate Director of the HBOS Specialised Investment Funds ICVC. Robert Fletcher Director HBOS Investment Fund Managers Limited 30 January

6 Statement and Reports Statement of the Authorised Corporate Director's (ACD's) Responsibilities The rules in the Collective Investment Schemes sourcebook issued by the Financial Conduct Authority ("the FCA") require the ACD to prepare financial statements for each accounting period which give a true and fair view of the financial position of the Company and of the net revenue and net gains and losses on the property of the Company for the period then ended. In preparing the financial statements the ACD is required to: select suitable accounting policies and then apply them consistently; make judgments and estimates that are reasonable and prudent; comply with the disclosure requirements of the Statement of Recommended Practice relating to the Financial Statements of Authorised Funds issued by the Investment Management Association in October 2010; follow generally accepted UK accounting principles and applicable UK accounting standards; and prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in operation. The ACD is responsible for keeping proper accounting records and for the management of the Company in accordance with its Instrument of Incorporation, the Prospectus and the FCA Rules. The ACD has general responsibility for taking such steps as are reasonably open to it to prevent and detect fraud and other irregularities. 4

7 Aggregated Interim Financial Statements Statement of total return Income 30 November November 2012 Net capital gains 57, ,896 Revenue 72,435 72,252 Expenses (12,393) (11,672) Finance costs: Interest (2) (7) Net revenue before taxation 60,040 60,573 Taxation (4,698) (4,685) Net revenue after taxation 55,342 55,888 Total return before distributions 112, ,784 Finance costs: Distributions (53,073) (52,960) Change in net assets attributable to shareholders from investment activities 59, ,824 Statement of change in net assets attributable to shareholders 30 November November 2012 Opening net assets attributable to shareholders 4,516,168 4,036,050 Amounts receivable on issue of shares 81, ,136 Amounts payable on cancellation of shares (243,741) (275,353) (162,407) (169,217) Stamp duty reserve tax (77) (124) Change in net assets attributable to shareholders from investment activities (see Statement of total return above) 59, ,824 Retained distributions on accumulation shares 46,764 46,996 Closing net assets attributable to shareholders 4,460,140 4,254,529 Comparative information is provided for the Statement of change in net assets attributable to shareholders. Since this information is for the prior interim period, the net assets at the end of that period do not correspond to the net assets at the start of the current period. 5

8 Aggregated Interim Financial Statements Balance sheet (unaudited) 30 November May 2013 ASSETS Portfolio of investments 4,370,619 4,445,127 Debtors 46,214 43,367 Cash and bank balances 66,817 56,142 Total other assets 113,031 99,509 Total assets 4,483,650 4,544,636 LIABILITIES Derivative liabilities 1, Creditors 16,525 16,509 Distribution payable on income shares 5,139 11,548 Total other liabilities 21,664 28,057 Total liabilities 23,510 28,468 Net assets attributable to shareholders 4,460,140 4,516,168 6

9 Notes to the Financial Statements Accounting Policies The aggregated financial statements represent the summation of the financial statements for each of the sub-funds. The interim financial statements for each of the sub-funds have been prepared in accordance with the Statement of Recommended Practice (SORP) for Authorised Funds issued by the Investment Management Association (IMA) in October 2010 (the IMA SORP 2010). The accounting and distribution policies applied are consistent with those of the financial statements for the year ended 31 May 2013 and are described in those annual financial statements. 7

10 Cautious Managed Fund Investment markets overview Investment objective The investment objective of the Cautious Managed Fund is to achieve long term growth by investing in a managed portfolio of equities investing mainly in the UK and fixed interest investments such as corporate bonds and gilts. Investment policy The Fund will actively manage a balanced mixture of assets between equities and fixed interest investments. The core of the equity assets within the Fund will tend to be invested in large companies whilst maintaining a reasonable presence in medium and small sized companies with above average potential for growth. However, the Fund is not restricted to the choice of company either by size or industry. The fixed interest assets will be invested primarily in a wide range of Sterling and Euro dominated investment grade interest bearing securities. UCITS scheme The Fund would qualify as a UCITS scheme operating under Chapter 5 of the COLL sourcebook if it were in itself an Open-Ended Investment Company in respect of which an authorisation order made by the FCA were in force. Not more than 20 the scheme property may consist of units in collective investment schemes. Synthetic risk and reward profile There are several different ways of measuring risk. The table below uses an industry standard measure of fund risk based on measuring a fund's volatility using its returns over the past five years. Volatility is generated by both rising and falling prices. Volatility doesn't tell you how much a fund has lost or gained; it indicates how volatile its returns were historically. The Fund's ranking may change over time and may not be a reliable indication of its future risk profile. This is a separate measure to the fund Risk Profiles we used to determine our investment portfolios (where we used our own methodology to take an overall look at the funds' risks and aims and group our funds into Cautious/Medium, Medium, Medium/Adventurous, Adventurous Profiles). This Fund is ranked at 5 because it has experienced medium to high levels of volatility over the past 5 years. The synthetic risk and reward indicator shown above is accurate and there have been no changes to this ranking to date. Investment review Performance 01/06/13 01/06/12 01/06/11 01/06/10 01/06/09 01/06/08 to 30/11/13 to 31/05/13 to 31/05/12 to 31/05/11 to 31/05/10 to 31/05/09 % % % % % % Cautious Managed Fund (1.74) (11.36) Benchmark* (11.79) Source: Financial Express for Cautious Managed Fund after 1 June 2013, Morningstar between 1 June 2011 and 31 May 2013 and Lipper for previous periods. Basis: Percentage growth, total return Share Class C (gross of tax and charges) at 12.00pm. *51% FTSE All Share Index, 39.2% iboxx Sterling Non-Gilt All Stocks Index and 9.8% FTSE Actuaries Government Securities UK Gilts All Stocks Index. Source: Scottish Widows Investment Partnership. Basis: Revenue reinvested and gross of expenses at close of business. Past performance is not a guide to future performance. The value of an investment and the revenue from it may go up and down and you may get back less than invested. 8

11 Cautious Managed Fund Investment markets overview (continued) Investment review (continued) The period under review produced mixed returns, although on the whole equities outperformed. The Fund adopts a comparatively cautious approach, which means it did not participate in the equity rally to the same extent as funds that are focussed purely on equities. It generated a gross return of 1.16% over the six months under review. Looking first at fixed income markets, both government and corporate bonds struggled over the last six months. Yields on government bonds rose, and prices fell throughout much of the reporting period. The initial causes were stronger-than-usual economic data and signs that central banks might start to withdraw their monetary stimulus policies, which have involved the purchase of bonds. However, after the Federal Reserve (Fed) reassured investors that its extraordinary stimulus measures would remain in place for the time being, a large part of the earlier falls were reversed. Corporate bonds outperformed their government-issued equivalents, as investors continued on their search for higher yield investments. The Fund s bond holdings are mainly concentrated within corporate bonds, which helped shield investors from some of the losses incurred in the government bond sector. The Fund s equity holdings produced stronger returns. The Fund s main equity position is in the UK equity market, which performed well. The main driver of sentiment stemmed from overseas and the ongoing extraordinary support from the world s central bankers. The US Fed, for example, has been ploughing $85 billion-a-month into the world s largest economy in order to spur growth. But it wasn t only events in the US that occupied UK investors. News that the economy is starting to recover was well received. This proved particularly beneficial for stocks that are sensitive to economic conditions. Looking ahead, we expect that stock markets will continue to receive support from modest economic improvements, combined with ongoing stimulus measures from central banks. As a result, the Fund retains a comparatively high weighting in equities. However, gains in the coming year appear unlikely to be of the magnitude experienced over the last year and a half and markets looks set for further volatility. For this reason, maintaining a cautiously managed portfolio of diversified holdings remains a sensible strategy. Scottish Widows Investment Partnership Limited December

12 Cautious Managed Fund Performance record Calendar Highest Lowest Net revenue year price price per share p p p 2008 Share Class C Share Class F Share Class G Share Class I Share Class C Share Class F Share Class G Share Class I Share Class C Share Class F Share Class G Share Class I Share Class C Share Class F Share Class G Share Class I Share Class C Share Class F Share Class G Share Class I * Share Class C Share Class F Share Class G Share Class I * Up to 30 November

13 Cautious Managed Fund Performance record (continued) Net asset Net asset value of value Shares share class per share in issue p as at 31 May 2011 Share Class C 1,218,013, ,703,712,000 Share Class F 280,178, ,816,000 Share Class G 11,599, ,807,000 Share Class I 2,156,309, ,079,896,000 as at 31 May 2012 Share Class C 1,043,396, ,287,812,000 Share Class F 333,098, ,219,181,000 Share Class G 10,358, ,612,000 Share Class I 1,839,994, ,310,521,000 as at 31 May 2013 Share Class C 1,114,425, ,962,067,000 Share Class F 449,324, ,384,471,000 Share Class G 12,701, ,747,000 Share Class I 1,989,752, ,785,991,000 Share Class C 1,072,460, ,826,642,000 Share Class F 474,546, ,448,486,000 Share Class G 13,074, ,472,000 Share Class I 1,925,756, ,565,675,000 Ongoing charges figure The ongoing charges figure (OCF) is the total expenses paid by each share class for the period, annualised, against its average net asset value. It excludes the cost of buying or selling assets for the Fund (unless these assets are shares of another fund). The OCF can fluctuate as underlying costs change. as at 31 May 2013 % % Share Class C Share Class F Share Class G Share Class I # # Fees are payable by institutional investors in this share class to the ACD outside the Fund. 11

14 Cautious Managed Fund Portfolio statement UNITED KINGDOM (72.33%, 31/05/ %) BASIC MATERIALS (2.88%, 31/05/ %) 2.88 Chemicals Alent 180, Carclo 32, Croda International 108,234 2, Elementis 413,892 1, Johnson Matthey 165,104 5, Synthomer 220, Victrex 65,838 1, , Forestry & Paper Mondi 295,699 2, , Industrial Metals & Mining Evraz 409, Ferrexpo 115, Mining Anglo American 1,049,116 14, Antofagasta 297,043 2, BHP Billiton 1,695,759 31, Eurasian Natural Resources 200, Fresnillo 136,078 1, Hochschild Mining 131, Kazakhmys 134, Lonmin 360,854 1, Petropavlovsk 148, Rio Tinto 1,001,711 32, Vedanta Resources 80, , TOTAL BASIC MATERIALS 100, CONSUMER GOODS (6.31%, 31/05/ %**) 6.31 Automobiles & Parts GKN 1,307,709 4, , Beverages A.G. Barr 69, Britvic 192,615 1, Diageo 2,022,248 39, Fuller Smith & Turner 15, SABMiller 753,091 23, ,

15 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) CONSUMER GOODS (continued) 6.31 Food Producers Anglo-Eastern Plantations 10, Associated British Foods 279,791 6, Cranswick 38, Dairy Crest 111, Devro 136, Hilton Food 24, Premier Foods 26, Tate & Lyle 371,203 2, Unilever 961,080 23, , Household Goods & Home Construction Barratt Developments 798,421 2, Bellway 98,886 1, Berkeley 99,976 2, Bovis Homes 109, Headlam 197, McBride 61, Persimmon 242,682 2, Reckitt Benckiser 513,913 25, Redrow 178, Taylor Wimpey 2,606,389 2, , Leisure Goods Games Workshop 40, Personal Goods Burberry 352,923 5, PZ Cussons 245, SuperGroup 26, , Tobacco British American Tobacco 1,540,406 50, Imperial Tobacco 782,234 18, , TOTAL CONSUMER GOODS 219, CONSUMER SERVICES (4.32%, 31/05/ %**) 4.32 Food & Drug Retailers Booker 1,266,443 2, Greggs 83, J Sainsbury 1,112,591 4, Ocado 347,280 1, Tesco 6,400,405 22, WM Morrison Supermarkets 1,737,760 4, ,

16 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) CONSUMER SERVICES (continued) 4.32 General Retailers Carpetright 41, Darty 69, Debenhams 1,015, Dixons Retail 2,968,208 1, Dunelm 80, Findel 11, Halfords 117, Home Retail 672,268 1, Howden Joinery 504,700 1, Inchcape 381,145 2, JD Sports Fashion 7, Kingfisher 1,901,881 7, Lookers 285, Marks & Spencer 1,290,156 6, Mothercare 17, N Brown 125, Next 121,269 6, Pendragon 867, Photo-Me International 41, Sports Direct International 168,214 1, Ted Baker 20, Topps Tiles 135, WH Smith 96, , Media Bloomsbury Publishing 36, British Sky Broadcasting 774,936 6, Chime Communications 34, Cineworld 103, Euromoney Institutional Investor 30, Huntsworth 69, ITE 194, ITV 2,935,903 5, Johnston Press 134, Moneysupermarket.com 294, Pearson 652,830 8, Perform 81, Reed Elsevier 953,751 8, Rightmove 79,672 2, St Ives 8, Trinity Mirror 34, Wilmington 7, ,

17 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) CONSUMER SERVICES (continued) 4.32 Travel & Leisure Betfair 75, Carnival 146,512 3, Compass 1,448,641 13, Domino's Pizza 114, easyjet 199,468 2, Enterprise Inns 415, Firstgroup 988,787 1, Go-Ahead 30, Greene King 178,065 1, InterContinental Hotels 211,150 4, JD Wetherspoon 73, Ladbrokes 727,683 1, Marston's 353, Millennium & Copthorne Hotels 122, Mitchells & Butlers 191, National Express 281, Restaurant 163, Spirit Pub 526, Stagecoach 348,922 1, Thomas Cook 1,172,300 2, TUI Travel 369,566 1, Whitbread 144,770 5, William Hill 692,607 2, , TOTAL CONSUMER SERVICES 150, FINANCIALS (16.15%, 31/05/ %) Banks Bank of Georgia 20, Barclays 12,907,100 35, HSBC 14,818, , Investec 411,331 1, Lloyds Banking Group 38,828,029 29, Royal Bank of Scotland 1,669,450 5, Standard Chartered 1,587,331 23, , Equity Investment Instruments Aberdeen Asian Smaller Companies Investment Trust 19, Aberdeen New Dawn Investment Trust 63, Aberdeen UK Tracker Trust 142, Aberforth Smaller Companies Trust 84, Alliance Trust 461,006 2, Artemis Alpha Trust 21, Asian Total Return Investment Company 37, Baillie Gifford Japan Trust 32, Bankers Investment Trust 91, Baring Emerging Europe 10, Biotech Growth Trust 17, BlackRock Commodities Income Investment Trust 47,

18 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) FINANCIALS (continued) Equity Investment Instruments (continued) BlackRock Emerging Europe Trust 19, BlackRock Greater Europe Investment Trust 59, BlackRock Latin American Investment Trust 19, BlackRock Smaller Companies Trust 90, BlackRock World Mining Trust 158, British Assets Trust 146, British Empire Securities and General Trust 124, Brunner Investment Trust 15, Caledonia Investments 27, Candover Investments 69, City Natural Resources High Yield Trust 33, Dunedin Income Growth Investment Trust 76, Ecofin Water & Power Opportunities 56, Edinburgh Dragon Trust 160, Edinburgh Worldwide Investment Trust 24, Electra Private Equity 29, European Investment Trust 21, F&C Capital & Income Investment Trust 44, F&C Global Smaller Companies 22, F&C Private Equity Trust 36, F&C US Smaller Companies 12, Fidelity Asian s 84, Fidelity European s 34, Fidelity Special s 27, Finsbury Growth & Income Trust 39, Foreign & Colonial Investment Trust 468,640 1, Henderson European Focus Trust 8, Henderson EuroTrust 42, Henderson Global Trust 20, Henderson High Income Trust 50, Henderson Smaller Companies Investment Trust 107, Henderson Trust 24, Herald Investment Trust 70, HgCapital Trust 34, Invesco Asia Trust 45, Invesco Income Growth Trust 29, Invesco Perpetual UK Smaller Companies Investment Trust 47, JPMorgan American Investment Trust 43, JPMorgan Asian Investment Trust 53, JPMorgan Chinese Investment Trust 38, JPMorgan Claverhouse Investment Trust 27, JPMorgan Emerging s Investment Trust 107, JPMorgan European Investment Trust 48, JPMorgan European Smaller Companies Trust 18, JPMorgan Japanese Investment Trust 82, JPMorgan Mid Cap Investment Trust 48, JPMorgan Overseas Investment Trust 11, JPMorgan Russian Securities 67, JPMorgan Smaller Companies Investment Trust 9, Jupiter European Opportunities Trust 40, Keystone Investment Trust 6,

19 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) FINANCIALS (continued) Equity Investment Instruments (continued) Law Debenture 79, Lowland Investment Company 13, Martin Currie Pacific Trust 21, Martin Currie Portfolio Investment Trust 52, Mercantile Investment Trust 88,955 1, Merchants Trust 84, Monks Investment Trust 186, Montanaro UK Smaller Companies Investment Trust 16, Murray Income Trust 55, Murray International Trust 102,190 1, North American Income Trust 15, Pacific Assets Trust 59, Pantheon International Participations 42, Perpetual Income and Growth Investment Trust 193, Personal Assets Trust Polar Capital Technology Trust 104, RCM Technology Trust 12, RIT Capital Partners 104,052 1, Schroder AsiaPacific Fund 142, Schroder Income Growth Fund 34, Schroder Japan Growth Fund 63, Schroder UK Growth Fund 81, Schroder UK Mid Cap Fund 143, Scottish Investment Trust 93, Scottish Mortgage Investment Trust 220,054 2, Scottish Oriental Smaller Companies Trust 16, Securities Trust of Scotland 56, Standard Life Equity Income Trust 19, Standard Life European Private Equity Trust 41, Standard Life UK Smaller Companies Trust 92, SVG Capital 210, Temple Bar Investment Trust 50, Templeton Emerging s Investment Trust 283,240 1, The City of London Investment Trust 212, The Edinburgh Investment Trust 172,845 1, Throgmorton Trust 108, TR European Growth Trust 25, TR Property Investment Trust 261, Troy Income & Growth Trust 120, and Income Trust 19, Witan Investment Trust 155,978 1, Witan Pacific Investment Trust 33, Worldwide Healthcare Trust 37, ,

20 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) FINANCIALS (continued) Financial Services 3i 789,067 2, Aberdeen Asset Management 760,627 3, Ashmore 350,218 1, Brewin Dolphin 214, Close Brothers 120,806 1, Crest Nicholson 102, esure 208, F&C Asset Management 470, Fidelity China Special Situations 492, Hargreaves Lansdown 175,180 2, Hogg Robinson 124, ICAP 439,105 1, IG 323,191 1, Impax Environmental s 219, Intermediate Capital 322,897 1, International Personal Finance 202,056 1, IP 300, Jupiter Fund Management 253, London Stock Exchange 154,676 2, Man 1,339,882 1, Paragon 244, Provident Financial 111,275 1, Rathbone Brothers 37, Schroders 90,735 2, Tullett Prebon 145, , Life Insurance Aviva 2,346,116 10, Chesnara 27, Legal & General 4,706,129 10, Old Mutual 3,893,229 7, Partnership Assurance 135, Prudential 2,032,710 26, St James's Place 352,813 2, Standard Life 1,929,064 6, , Non-Equity Investment Instruments Greencoat UK Wind 277, Greencoat UK Wind Rights 18/12/ , Scottish Widows UK Smaller Companies Fund X Acc 2,092,482 7, Scottish Widows Fundamental Index UK Equity Fund X Acc 166,164, , ,

21 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) FINANCIALS (continued) Non-Life Insurance Admiral 154,666 1, Amlin 378,801 1, Direct Line Insurance 885,774 2, Jardine Lloyd Thompson 100,128 1, Novae 58, RSA Insurance 2,934,625 3, , Real Estate Investment & Services Capital & Counties Properties 536,543 1, CLS 8, Countrywide 64, Development Securities 92, Grainger 336, Helical Bar 50, LSL Property Services 42, Quintain Estates & Development 231, Savills 101, ST Modwen Properties 135, Unite 193, , Real Estate Investment Trusts Big Yellow 130, British Land 801,606 4, Derwent London 74,908 1, Great Portland Estates 281,632 1, Hammerson 568,105 2, Hansteen 523, Intu Properties 566,378 1, Land Securities 630,287 6, Londonmetric Property 465, Mucklow A & J 8, Primary Health Properties 47, Segro 607,333 2, Shaftesbury 204,690 1, Workspace 85, , TOTAL FINANCIALS 563,

22 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) FIXED INCOME (23.25%, 31/05/ %) Corporate Bonds Abbey National Treasury Services 5.75% 02/03/2027 5,753,000 6, Abbey National Treasury Services 5.25% 16/02/2030 8,332,000 9, Amlin 6.5% 19/12/2026 5,903,000 6, Anglian Water Services Financing 6.293% 30/07/2030 2,184,000 2, Arqiva Financing 4.882% 31/12/2032 5,860,000 5, Artesian Finance 6% 30/09/2033 9,559,000 11, Aviva 6.125% 14/11/2036 3,840,000 4, Aviva 6.875% 20/05/2058 6,068,000 6, Aviva 6.125% Perpetual 5,490,000 5, Bank of Scotland 6.375% 16/08/2019 5,535,000 6, Barclays Bank 10% 21/05/2021 6,822,000 8, Barclays Bank 4.25% 12/01/2022 3,478,000 3, Barclays Bank 5.75% 14/09/2026 4,856,000 5, Barclays Bank 6.375% Perpetual 4,116,000 4, Barclays Bank 14% Perpetual 3,895,000 5, BAT International Finance 6.375% 12/12/2019 4,432,000 5, BAT International Finance 6% 29/06/2022 6,100,000 7, BG Energy Capital 5% 04/11/2036 3,888,000 4, BG Energy Capital 6.5% 30/11/2072 5,147,000 5, BP Capital s 4.325% 10/12/2018 8,819,000 9, British Telecommunications 5.75% 07/12/ ,916,000 13, BUPA Finance 5% 25/04/2023 6,867,000 6, Centrica 6.375% 10/03/2022 9,853,000 11, Centrica 4.25% 12/09/2044 2,978,000 2, Circle Anglia Social Housing 5.2% 02/03/2044 4,454,000 4, Clydesdale Bank 4.625% 08/06/2026 8,177,000 8, Coventry Building Society 4.625% 19/04/2018 6,786,000 7, CTRL Section 1 Finance 5.234% 02/05/2035 8,436,000 9, EE Finance 4.375% 28/03/2019 4,817,000 5, Experian Finance 4.75% 23/11/2018 5,739,000 6, Firstgroup 6.125% 18/01/2019 5,067,000 5, Friends Life 8.25% 21/04/2022 4,517,000 5, G4S 7.75% 13/05/2019 2,790,000 3, GKN 6.75% 28/10/2019 3,382,000 3, Great Rolling Stock 6.5% 05/04/2031 4,622,000 5, Hammerson 6.875% 31/03/2020 3,334,000 4, Hammerson 7.25% 21/04/2028 2,406,000 3, Heathrow Finance 7.125% 01/03/2017 1,790,000 1, HSBC 6.5% 20/05/2024 2,612,000 3, HSBC 5.375% 22/08/2033 4,612,000 4, HSBC 7% 07/04/2038 8,550,000 10, Hutchison Whampoa Finance 'B' 5.625% 24/11/2026 5,850,000 6, Imperial Tobacco Finance 7.75% 24/06/2019 4,924,000 6, Imperial Tobacco Finance 8.125% 15/03/2024 7,503,000 9, Integrated Accommodation Services 6.48% 31/03/ , InterContinental Hotels 3.875% 28/11/2022 5,724,000 5, Jaguar Land Rover Automotive 8.125% 15/05/2018 3,678,000 3, Lloyds TSB Bank % 29/05/2020 6,149,000 6, Lloyds TSB Bank 10.75% 16/12/2021 3,533,000 4, Lloyds TSB Bank % 12/02/2024 3,019,000 3, Lloyds TSB Bank 7.5% 15/04/2024 3,694,000 4,

23 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) FIXED INCOME (continued) Corporate Bonds (continued) Lloyds TSB Bank 5.75% 09/07/2025 7,687,000 7, Lloyds TSB Bank 6.5% 17/09/2040 3,298,000 4, London & Quadrant Housing Trust 4.625% 05/12/2033 4,098,000 4, London Power Networks 5.125% 31/03/2023 3,820,000 4, London Stock Exchange 6.125% 07/07/2016 2,047,000 2, Marks & Spencer 4.75% 12/06/2025 6,090,000 6, Mitchells & Butlers Finance 5.965% 15/12/2025 2,128,972 2, Motability Operations 5.625% 29/11/ ,737,000 13, National Grid Electricity Transmission 6.5% 27/07/2028 4,194,000 5, National Grid Electricity Transmission 7.375% 13/01/2031 8,141,000 11, National Grid Gas 6.375% 03/03/2020 2,500,000 2, National Westminster Bank 6.5% 07/09/2021 4,210,000 4, Nationwide Building Society 6.75% 22/07/2020 6,662,000 6, Northumbrian Water Finance 5.125% 23/01/2042 5,262,000 5, Octagon Healthcare Funding 5.333% 30/06/2036 7,484,162 8, Pearson Funding One 6% 15/12/2015 1,428,000 1, Pennon 6.75% Perpetual 4,612,000 4, Provident Financial 8% 23/10/2019 4,550,000 5, Prudential 6.875% 20/01/2023 5,125,000 6, RMPA Services 5.337% 30/09/2038 6,187,310 6, Royal Bank of Scotland 7.5% 29/04/2024 7,141,000 9, RSA Insurance 9.375% 20/05/2039 2,832,000 3, RSA Insurance 8.5% Perpetual 6,304,000 6, Sanctuary Capital 5% 26/04/2047 2,800,000 3, Santander UK 9.625% 30/10/2023 5,710,000 6, Santander UK 7.5% Perpetual 4,395,000 4, Segro 5.625% 07/12/2020 3,183,000 3, Severn Trent Utilities Finance 6% 22/01/2018 2,286,000 2, Severn Trent Utilities Finance 6.125% 26/02/2024 4,601,000 5, Smiths 4.125% 05/05/2017 5,103,000 4, Society of Lloyd's 6.875% 17/11/2025 4,474,000 4, Society of Lloyd's 7.421% Perpetual 3,859,000 4, South Eastern Power Networks 5.5% 05/06/2026 4,149,000 4, Southern Electric Power Distribution 4.625% 20/02/2037 4,100,000 4, Southern Gas Networks 4.875% 21/12/2020 5,179,000 5, SPD Finance UK 5.875% 17/07/2026 4,395,000 4, SSE 5.875% 22/09/2022 9,019,000 10, SSE 5.025% Perpetual 3,760,000 3, Standard Chartered Bank 7.75% Perpetual 11,660,000 13, Standard Life 6.75% Perpetual 8,715,000 9, Tesco 5% 24/03/ , Thames Water Kemble Finance 7.75% 01/04/2019 4,304,000 4, Thames Water Utilities Finance 5.125% 28/09/2037 7,593,000 8, THFC Funding No 3 5.2% 11/10/2043 4,297,000 4, Transport for London 2.25% 09/08/2022 3,260,000 3, United Utilities Water 5.75% 25/03/2022 4,951,000 5,

24 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) FIXED INCOME (continued) Corporate Bonds (continued) UPP Bond 1 Issuer % 28/02/2040 4,535,475 4, Vodafone 5.9% 26/11/2032 4,095,000 4, Western Power Distribution South West 5.75% 23/03/ ,000 1, Western Power Distribution West Midlands 5.75% 16/04/2032 9,594,000 10, WM Morrison Supermarkets 4.625% 08/12/2023 2,834,000 2, Yorkshire Building Society 4.75% 12/04/2018 4,612,000 5, , Government Bonds UK Treasury 2.25% 07/03/ ,592,000 26, UK Treasury 5% 07/09/2014 8,052,000 8, UK Treasury 2% 22/01/2016 9,910,000 10, UK Treasury 4% 07/09/ ,930,000 11, UK Treasury 1.75% 22/01/2017 3,192,000 3, UK Treasury 1.25% 22/07/ , UK Treasury 4.5% 07/03/2019 7,094,000 8, UK Treasury 3.75% 07/09/ , UK Treasury 3.75% 07/09/ ,000 1, UK Treasury 5% 07/03/2025 5,162,000 6, UK Treasury 4.25% 07/12/ ,381,000 13, UK Treasury 6% 07/12/2028 1,968,000 2, UK Treasury 4.25% 07/06/2032 1,001,000 1, UK Treasury 4.5% 07/09/ ,015,000 25, UK Treasury 4.25% 07/03/2036 3,763,000 4, UK Treasury 4.75% 07/12/2038 3,969,000 4, UK Treasury 3.75% 22/07/2052 2,055,000 2, UK Treasury 4% 22/01/2060 1,990,000 2, , Mortgage Backed Securities Annington Finance No % 10/01/2023 1,550,000 1, Aspire Defence Finance Series A 4.674% 31/03/2040 3,556,000 3, Aspire Defence Finance Series B 4.674% 31/03/2040 5,303,000 5, Canary Wharf Finance II 6.455% 22/10/2033 3,545,102 4, Canary Wharf Finance II 5.952% 22/10/2037 5,060,000 6, Dignity Finance 8.151% 31/12/2031 3,440,000 4, Equity Release Funding 5.05% 26/04/2033 7,742,000 8, Fosse Master Issuer 4.635% 18/10/2054 7,174,000 7, Holmes Master Issuer FRN % 3,800,000 3, Land Securities Capital s 4.875% 29/09/2025 1,355,000 1, Land Securities Capital s 5.376% 30/09/2029 3,055,000 3, Land Securities Capital s 5.396% 31/07/2032 3,242,000 3, Land Securities Capital s 5.125% 07/02/2036 1,105,000 1, Meadowhall Finance 4.986% 12/07/2037 5,485,130 6, Meadowhall Finance 4.988% 12/07/2037 2,145,813 2,

25 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) FIXED INCOME (continued) Mortgage Backed Securities (continued) Telereal Securitisation % 10/12/2033 4,226,343 4, Telereal Securitisation % 10/12/2033 3,825,932 4, Tesco Property Finance % 13/07/2039 7,630,854 10, Tesco Property Finance % 13/10/ , Tesco Property Finance % 13/07/2044 3,384,000 3, , TOTAL FIXED INCOME 809, HEALTH CARE (3.17%, 31/05/ %) 3.17 Health Care Equipment & Services Al Noor Hospitals 41, Dignity 43, Optos 36, Smith & Nephew 719,919 5, Synergy Health 40, , Pharmaceuticals & Biotechnology AstraZeneca 1,001,567 34, BTG 309,121 1, Dechra Pharmaceuticals 71, Genus 49, GlaxoSmithKline 3,954,730 63, Hikma Pharmaceuticals 109,063 1, Vectura 169, , TOTAL HEALTH CARE 110, INDUSTRIALS (3.82%, 31/05/ %**) 3.82 Aerospace & Defence BAE Systems 2,604,666 11, Cobham 918,814 2, Meggitt 630,255 3, QinetiQ 521,302 1, Rolls-Royce 1,502,811 18, Rolls Royce Preference Shares 129,241, Ultra Electronics 56,932 1, ,

26 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) INDUSTRIALS (continued) 3.82 Construction & Materials Balfour Beatty 563,578 1, Carillion 352,324 1, Costain 19, Galliford Try 56, Keller 52, Kier 43, Low & Bonar 150, Marshalls 99, Morgan Sindall 4, , Electronic & Electrical Equipment Dialight 23, Domino Printing Sciences 88, E2V Technologies 31, Laird 238, Morgan Crucible 220, Oxford Instruments 43, Renishaw 29, Spectris 104,353 2, TT Electronics 211, Xaar 61, , General Industrials British Polythene Industries 12, DS Smith 797,326 2, Rexam 623,491 3, RPC 135, Smiths 314,763 4, Vesuvius 216,924 1, , Industrial Engineering Bodycote 156, Chemring 159, Fenner 157, Halma 300,019 1, Hill & Smith 97, IMI 253,915 3, Melrose Industries 1,016,960 2, Rotork 76,253 2, Senior 337, Severfield-Rowen 149, Spirax-Sarco Engineering 62,859 1, Weir 170,616 3, ,

27 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) INDUSTRIALS (continued) 3.82 Industrial Transportation BBA Aviation 385,019 1, Clarkson 6, James Fisher & Sons 33, UK Mail 11, Wincanton 14, , Support Services Aggreko 202,401 3, Ashtead 443,942 3, Babcock International 288,279 3, Berendsen 133,712 1, Brammer 64, Bunzl 265,677 3, Capita 528,139 5, De La Rue 81, Diploma 92, Electrocomponents 359,262 1, Filtrona 188,212 1, G4S 1,245,758 3, Hays 1,137,558 1, HellermannTyton 163, Homeserve 224, Interserve 80, Intertek 129,061 3, John Menzies 32, Lavendon 269, Mears 49, Michael Page International 236,485 1, Mitie 292, Northgate 97, PayPoint 53, Premier Farnell 301, Rentokil Initial 1,482,255 1, Ricardo 61, RPS 179, Safestore * 60, Serco 396,001 1, Shanks 75, SIG 459, Speedy Hire 92, Sthree 185, Travis Perkins 194,308 3, WS Atkins 69, Xchanging 67, , TOTAL INDUSTRIALS 133,

28 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) OIL & GAS (6.65%, 31/05/ %) 6.65 Oil & Gas Producers Afren 889,918 1, BG 2,732,496 34, BP 14,943,178 72, Cairn Energy 493,269 1, EnQuest 589, Essar Energy 234, John Wood 297,189 2, Ophir Energy 414,151 1, Premier Oil 414,970 1, Royal Dutch Shell 'A' 3,022,136 62, Royal Dutch Shell 'B' 2,019,173 43, Salamander Energy 103, Soco International 160, Tullow Oil 725,688 6, , Oil Equipment, Services & Distribution AMEC 256,767 2, Hunting 111, , TOTAL OIL & GAS 231, TECHNOLOGY (0.69%, 31/05/ %**) 0.69 Software & Computer Services Anite 253, Aveva 51,803 1, Computacenter 63, Fidessa 30, Innovation 493, Invensys 561,874 2, Kofax 34, Micro Focus International 101, NCC 99, Sage 891,023 3, SDL 54, Telecity 164,396 1, , Technology Hardware & Equipment ARM 1,121,399 11, CSR 128, Imagination Technologies 198, Pace 267, Spirent Communications 527, Wolfson Microelectronics 54, , TOTAL TECHNOLOGY 25,

29 Cautious Managed Fund Portfolio statement (continued) UNITED KINGDOM (continued) TELECOMMUNICATIONS (3.41%, 31/05/ %) 3.41 Fixed Line Telecommunications BT 6,272,452 23, Cable & Wireless Communications 2,070, Kcom 419, TalkTalk Telecom 371,630 1, Telecom Plus 43, Telecom Plus New Ordinary Shares Rights 05/12/2013 1, , Mobile Telecommunications Inmarsat 339,148 2, Vodafone 39,104,699 89, , TOTAL TELECOMMUNICATIONS 118, UTILITIES (1.68%, 31/05/ %) 1.68 Electricity Drax 315,839 2, SSE 769,463 10, , Gas, Water & Multiutilities Centrica 4,136,509 14, National Grid 2,994,697 23, Pennon 296,612 1, Severn Trent 189,750 3, United Utilities 547,407 3, , TOTAL UTILITIES 58, TOTAL UNITED KINGDOM 2,520, AUSTRALIA (0.99%, 31/05/ %) 0.99 FIXED INCOME (0.99%, 31/05/ %) 0.99 Corporate Bonds BHP Billiton Finance 4.3% 25/09/2042 3,472,000 3, Commonwealth Bank of Australia 3% 04/09/ ,492,000 11, National Australia Bank 5.125% 09/12/2021 6,149,000 6, Origin Energy Finance 7.875% 16/06/2071 4,715,000 4, QBE Insurance 6.125% 28/09/2015 4,307,000 4, Santos Finance 8.25% 22/09/2070 4,265,000 3, , TOTAL FIXED INCOME 34, TOTAL AUSTRALIA 34,

30 Cautious Managed Fund Portfolio statement (continued) BELGIUM (0.22%, 31/05/ %) 0.22 FIXED INCOME (0.22%, 31/05/ %) 0.22 Corporate Bonds Anheuser-Busch InBev 9.75% 30/07/2024 3,148,000 4, Anheuser-Busch InBev 4% 24/09/2025 2,900,000 2, , TOTAL FIXED INCOME 7, TOTAL BELGIUM 7, BERMUDA (0.15%, 31/05/ %) 0.15 BASIC MATERIALS (0.01%, 31/05/ %) 0.01 Mining Aquarius Platinum 27, Petra Diamonds 335, TOTAL BASIC MATERIALS FINANCIALS (0.14%, 31/05/ %) 0.14 Non-Life Insurance Catlin 276,040 1, Hiscox 308,456 2, Lancashire 148,706 1, , TOTAL FINANCIALS 4, TOTAL BERMUDA 5, BRAZIL (0.15%, 31/05/ %) 0.15 FIXED INCOME (0.15%, 31/05/ %) 0.15 Corporate Bonds Votorantim Cimentos 5.25% 28/04/2017 5,771,000 5, , TOTAL FIXED INCOME 5, TOTAL BRAZIL 5, BRITISH VIRGIN ISLANDS (0.00%, 31/05/ %) 0.00 BASIC MATERIALS (0.00%, 31/05/ %) 0.00 Mining Gem Diamonds 23, TOTAL BASIC MATERIALS TOTAL BRITISH VIRGIN ISLANDS

31 Cautious Managed Fund Portfolio statement (continued) CANADA (0.10%, 31/05/ %) 0.10 CONSUMER SERVICES (0.01%, 31/05/ %) 0.01 Media Entertainment One 163, TOTAL CONSUMER SERVICES FIXED INCOME (0.09%, 31/05/ %) 0.09 Corporate Bonds Xstrata Finance Canada 7.375% 27/05/2020 2,521,000 3, , TOTAL FIXED INCOME 3, TOTAL CANADA 3, CAYMAN ISLANDS (1.13%, 31/05/ %) 1.13 FINANCIALS (0.03%, 31/05/ %) 0.03 Life Insurance Phoenix 152,644 1, , TOTAL FINANCIALS 1, FIXED INCOME (1.10%, 31/05/ %) 1.10 Corporate Bonds Dwr Cymru Financing 6.907% 31/03/2021 3,215,000 3, Hutchison Whampoa Europe Finance % Perpetual 7,125,000 5, South East Water Finance % 30/09/2019 4,840,000 5, Thames Water Utilities Cayman Finance 5.5% 11/02/2041 3,920,000 4, Yorkshire Water Services Bradford Finance 6% 24/04/2025 6,252,000 6, Yorkshire Water Services Odsal Finance 6.454% 28/05/2027 1,745,000 2, Yorkshire Water Services Odsal Finance % 17/04/2031 7,814,000 9, , TOTAL FIXED INCOME 38, TOTAL CAYMAN ISLANDS 39, DENMARK (0.41%, 31/05/ %) 0.41 FIXED INCOME (0.41%, 31/05/ %) 0.41 Corporate Bonds Danske Bank 5.375% 29/09/2021 6,837,000 7, DONG Energy 4.875% 12/01/2032 3,306,000 3, DONG Energy 5.75% 09/04/2040 3,430,000 3, , TOTAL FIXED INCOME 14, TOTAL DENMARK 14,