Invesco Funds Series 1 Annual Report (Audited) For the year ended 30 November 2013

Transcription

1 Invesco Funds Series 1 Annual Report (Audited) For the year ended 30 November 2013

2 Invesco ASEAN Equity Fund Investment Policy and Description of the Fund 04 Price and Income Record 03 Investment Adviser s Report on behalf of the Manager Portfolio Statement 04 Performance Record 07 Changes in the Composition of the Portfolio Invesco Japanese Equity Fund Investment Policy and Description of the Fund 09 Price and Income Record 08 Investment Adviser s Report on behalf of the Manager Portfolio Statement 09 Performance Record 12 Changes in the Composition of the Portfolio Invesco Pacific Equity Fund Investment Policy and Description of the Fund 14 Price and Income Record 13 Investment Adviser s Report on behalf of the Manager Portfolio Statement 14 Performance Record 18 Changes in the Composition of the Portfolio 19 Balance Sheet 30 November Notes to the Financial Statements 20 Balance Sheet 30 November Statement of the Manager s and Trustee s Responsibilities 21 Income Statement 30 November Report of the Independent Auditors to the Shareholders 22 Income Statement 30 November Report of the Trustee to the Shareholders 23 Statement of Changes in the Net Assets attributable to 42 General Information Holders of Redeemable Participating Shares 30 November Statement of Changes in the Net Assets attributable to Holders of Redeemable Participating Shares 30 November 2012 Invesco Funds Series 1

3 Investment Policy and Description of Series Invesco ASEAN Equity Fund (the Fund ) aims to achieve long term capital growth by investing in the ASEAN countries. For investment purposes the Manager (Invesco Global Asset Management Limited) has defined the ASEAN countries as the members of the Association of South East Asian Nations which currently comprise Singapore, Malaysia, Thailand, Indonesia, Brunei, the Philippines, Vietnam, Cambodia, Laos and Myanmar. It is the Manager s intention to invest in some or all of the above countries. The investment emphasis will be on geographical asset allocation without any limit as to the proportion of the Fund which may be invested in any one country. As a consequence, the balance of investment between the countries will vary from time to time. The Manager will seek to achieve the investment objective by investing predominantly in listed equity or equity-related securities (including warrants and convertible securities however, no more than 10% of the net asset value of the Fund may be invested in warrants) of companies which operate in or stand to benefit from their operations in and business links with the ASEAN countries. Until such time as Brunei has a stock exchange or recognised market, only 10% of the Fund may be invested in Brunei. Investment in Brunei, Laos and Myanmar will be by way of Global Depository Receipts (GDR s) and American Depository Receipts (ADR s). In the case of Cambodia, investment will not be made directly in local markets at the present time but exposure may be taken through GDR s and ADR s and collective investment schemes investing in Cambodia. Such investment is subject to the limits as set out under Investment Restrictions. GDR s and ADR s are negotiable certificates in registered form issued by banks where the issuing bank certifies that a specific number of Shares have been deposited with it and acts as custodian of those Shares. GDR s are issued internationally through links between clearing houses in the US and Europe. ADR s are issued and traded on several US stock markets, particularly the New York Stock Exchange and NASDAQ. Invesco Japanese Equity Fund (the Fund ) aims to achieve long-term capital growth by investing in the securities of Japanese companies. At least 70% of the Funds total assets (after deducting ancillary liquid assets) will be invested in equity or equity-related securities of (i) companies having their registered office in Japan, (ii) companies with their registered office outside Japan carrying out their business activities predominantly in Japan, or (iii) holding companies, the interests of which are predominantly invested in companies with their registered office in Japan. Up to 30% of the total assets of the Fund may be invested in aggregate in cash and cash equivalents, money market instruments, equity and equity related instruments issued by companies or other entities not meeting the above requirement or debt securities (including convertible debt) of Japanese issuers. Invesco Pacific Equity Fund (the Fund ) aims to achieve long-term capital growth by investing in the securities of companies throughout Asia, but with particular emphasis on those based in the Asian Pacific region. For the purposes of the Fund the Manager has defined the Asian Pacific region as South East Asia (including Singapore, Malaysia, Thailand, Indonesia and the Philippines), East Asia (including Taiwan, South and North Korea, Hong Kong and Japan), China, Australia and New Zealand. At least 70% of the Funds total assets (after deducting ancillary liquid assets) will be invested in listed equity or equity-related securities of (i) companies having their registered office in the Asia Pacific region, (ii) companies with their registered office outside this region carrying out their business activities predominantly in the Asia Pacific region, or (iii) holding companies, the interests of which are predominantly invested in companies with their registered office in the Asia Pacific region. The Funds exposure to the various markets in the region will vary from time to time according to the Manager s opinion as to the prevailing conditions in and prospects for those markets. Description of the Fund Invesco Funds Series 1 (the Fund ) is a multi-portfolio Irish Unit Trust comprising Invesco ASEAN Equity Fund, Invesco Japanese Equity Fund and Invesco Pacific Equity Fund (together the Funds ). The Series is authorised by the Central Bank of Ireland in Ireland as a UCITS under the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011 (as amended) and by the Hong Kong Securities and Futures Commission (SFC) under the Hong Kong Securities and Futures Ordinance (Cap. 571) and has been recognised by the Financial Services Authority in the United Kingdom under Section 264 of the Financial Services and Markets Act 2000 (the Act ). The Funds issue units to unitholders. As per the consolidated prospectus issued, these units are referred to as Shares and the unitholder is referred to as the Shareholder throughout these financial statements. Each Fund is a fund in the Invesco range of funds managed by Invesco Global Asset Management Limited (the Manager ). Invesco Global Asset Management Limited is an indirect wholly-owned subsidiary of Invesco Ltd. Each Fund is approved by the Central Bank of Ireland. Each Fund is also approved by the SFC. In giving authorisation for the Fund the SFC does not take responsibility for the financial soundness of a fund nor for the correctness of any statements made or opinions expressed in this regard. The Funds are not registered under the United States Investment Company Act of 1940 (as amended) and shares in the Funds ( Shares ) have not been registered under the United States Securities Act of 1933 (as amended). Accordingly, Shares may not be offered, sold or delivered in the United States or to US Persons as defined in the current Prospectus of the Fund. The contents of this report, for which the Directors of the Manager are responsible, have been approved by Invesco Global Asset Management Limited, which is regulated by the Central Bank of Ireland in Ireland. Share prices are available through the Invesco internet site (for Shareholders in Hong Kong please refer to and, if required by local law or regulation, published in local leading financial newspapers including, in the case of Hong Kong, the Hong Kong Economic Times, the South China Morning Post and the Hong Kong Economic Journal. Share prices are currently also available from Reuters and Bloomberg. Any investment in the Funds should be considered long-term. There can be no guarantee that the amounts subscribed for Shares will be ultimately realised. Changes in rates of exchange between currencies may cause the value of an investment in the Funds of the Series to diminish or increase. Investors should be aware that investment in emerging markets is by its nature both high risk and potentially volatile. This report to Shareholders does not constitute an offer or invitation to purchase Shares in any of the Funds. Up to 30% in aggregate of the total assets of the Fund may be invested in cash and cash equivalents, equity and equity related securities of companies which do not meet the requirements set out above but stand to benefit from their business links with countries in Asia other than the Asia Pacific region or debt securities (including convertible debt) of issuers in the Asian region. 01 Invesco Funds Series 1

4 Investment Policy and Description of Series (continued) Description of the Fund (continued) A new consolidated prospectus for Invesco Funds Series 1,2,3,4,5,6 and Invesco Fund Series was issued on 20 May 2013 and 20 August This contains all relevant information (as at the date of issue) regarding the Series and other Funds within the Invesco Fund Series 1, Invesco Funds Series 2, Invesco Funds Series 3, Invesco Funds Series 4, Invesco Funds Series 5, Invesco Funds Series 6 and Invesco Fund Series. This report to Shareholders has been prepared on the basis of the Prospectus. If you wish to receive a copy of the Prospectus please contact any Invesco office. Charges Annual Annual Annual Annual Share Launch Management Distributor Administration Trustee Date Fee Fee Fee Fee Actual Max % % % % Invesco ASEAN Equity Fund A Shares AA 13/01/ A (Acc-HKD) 07/07/ Shares A B Shares AA 20/08/ C Shares AA 02/09/ Z Shares AA 21/08/ Invesco Japanese Equity Fund A Shares AA 13/01/ B Shares AA 20/08/ C Shares AA 13/01/ Invesco Pacific Equity Fund A Shares AA 13/01/ B Shares AA 20/08/ C Shares AA 02/09/ I Shares A 05/07/2006 N/A Z Shares AA 21/08/ Distribution Frequency A = Accumulating AA = Annual The Manager s fee is based on the daily net asset value of each Fund and is paid monthly. The Manager will also be paid a fee in respect of its duties as Administrator and Registrar for each Fund. The Administration fee will be calculated daily and will be paid monthly on the last Business Day of each month at the rates set out above, based on the net asset value of each share class of each Fund on each Business Day. The charges are deductible from the income of each Fund or from capital in the event of an income shortfall. The Manager may pay a portion of its administration fees to the sub-administrator in consideration for the sub-administrator providing certain administrative functions to the Funds. The Trustee will be paid a fee calculated on a sliding scale to a maximum rate of % per annum of the net asset value of each class of each Share of the Fund on the last business day of the month and paid monthly. The assets of a fund are exclusively available to satisfy the rights of Shareholders in relation to that Fund and the rights of creditors whose claims have arisen in connection with the creation, operation or liquidation of that Fund. 02 Invesco Funds Series 1

5 Invesco ASEAN Equity Fund Investment Adviser s Report on behalf of the Manager ASEAN equity markets experienced significant periods of volatility over the twelve months to 30 November 2013 finally ending 0.5% higher. Changing expectations of when the US Federal Reserve s tapering of asset purchases would begin was the main catalyst of volatility in both ASEAN equity and currency markets during These concerns were particularly heightened in the third quarter, when the fear of capital outflow from the ASEAN region sent tremors to Indonesia, the Philippines and Thailand as investors scrutinized their current account situation. The Fund s A Shares returned (2.83%) versus the MSCI Southeast Asia ND Index return of 0.49% for the 12 months ended 30 November For the period under review, sector allocation was the main attributor of underperformance. Our overweight position in Consumer Discretionary was a key detractor. Within this sector, our holdings in an Indonesian household appliances manufacturer and a Singapore-based motorcycle manufacturer detracted from performance. In terms of markets, our overweight position in Indonesia hurt Fund performance as it was the worst-performing market; the underweight position in Singapore also detracted as the market outperformed its regional peers. On the positive side, stock selection added to performance. During the review period, we reduced our underweight in Malaysia as we expected market momentum to remain strong. We also increased our underweight exposure in Singapore mainly by exiting our position in real estate developers. On a sector basis, we trimmed our overweight in Industrials to an underweight. Some of the Industrials exposure was rotated into the utilities sector in which we now have a slight overweight. Consumer Discretionary remained the biggest overweight sector in the portfolio, albeit at a slightly reduced level. As we begin 2014 the global macro backdrop continues to improve with Purchasing Managers Index (PMI) Survey data of developed market economies remaining in the expansionary zone. We believe Asia could ride on the global recovery trade, in particular, export-driven sectors could benefit from the revival of external demand. The weakened currencies of South Asian countries could help with their exports and in turn, alleviate the current account situation. The commencement of tapering at the end of 2013 helped to remove a significant source of uncertainty for global markets. Asset purchase tapering simply means a smaller net addition of assets to the Fed s balance sheet, not an outright sale of assets. Therefore we believe liquidity within the global financial system should remain ample for emerging market assets. It is worth noting that the equity correction in some South Asian markets during mid-2013 priced in the fear of capital outflows once tapering happens and brought valuations to a more reasonable level. We are confident that Asia as a region can withstand the impact of an orderly tapering. Nonetheless, the retreat of excessively easy liquidity in the global financial system will make investors focus more on the differentiation of economies and be more selective. Therefore while we are positive on the outlook of Asia, we believe selectivity is key. In ASEAN markets, reform and election dynamics will be a big theme in Indonesia will hold legislative elections in April 2014 and a presidential election in July. Lately, Thai Prime Minister Yingluck Shinawatra dissolved the parliament and called for fresh elections to be held in February We expect the current political turmoil in Thailand to be an overhang for investor sentiment; meanwhile, we continue to look for secular growth stories in Thailand which could be relatively immune from macro headwinds. On the positive side, we expect the Malaysia and the Philippine economies to remain strong through the first quarter of Dated: 21/01/2014 Invesco Global Asset Management Limited 03 Invesco Funds Series 1

6 Invesco ASEAN Equity Fund Fund Performance Percentage change over: (All expressed in the share class base currency, Last Last Last 5 years mid to mid, gross income reinvested) 6 months 12 months (Cumulative) Invesco ASEAN Equity A Shares (11.85) (2.83) Invesco ASEAN Equity A Acc HKD Shares (11.97) (2.74) n/a Invesco ASEAN Equity B Shares (12.24) (3.63) Invesco ASEAN Equity C Shares (11.58) (2.29) Invesco ASEAN Equity Z Shares n/a n/a n/a MSCI Indonesia Value* (26.18) (17.87) MSCI Malaysia Free* (0.72) MSCI Philippines Free* (11.61) MSCI Singapore* MSCI Thailand* (12.56) (1.53) MSCI South East Asia Index (benchmark) (8.53) Morningstar GIF OS ASEAN Equity* (14.04) (0.96) Source: Morningstar * For comparative purposes The Net Asset Value Information for 30 November 2013 and 30 November 2012 can be found on pages 19 and 20. Price and Income Record The table below shows the highest and lowest NAV prices of Shares in the Fund and the annual income distribution of the Fund in the last 10 years. Calendar Highest Lowest Highest NAV Lowest NAV Highest Lowest Highest Lowest Highest Lowest NAV Price NAV Price Price A-Acc Price A-Acc NAV Price NAV Price NAV Price NAV Price NAV Price NAV Price A Shares A Shares HKD Shares HKD Shares B Shares B Shares C Shares C Shares Z Shares Z Shares Year $ $ HK$ HK$ $ $ $ $ $ $ n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Calendar Net Income per $2,000 Net Income Distribution invested in October 1992 at a price of $ per Share A Shares B Shares C Shares Z Shares A Shares B Shares C Shares Z Shares Year $ $ $ $ $ $ $ $ n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Figures to 31 December 2013 Source: Invesco Global Asset Management Limited. Distributions, if any, are paid annually to A, B C and Z Shareholders on or after 21 January and details are set out in note 10. Reports on the progress of the Fund are published on or before 31 March and on or before 31 July each year and shall be made available to Shareholders free of charge on request. The price of Shares and the income from them can go down as well as up. Please note that past performance is not necessarily a guide to future performance. 04 Invesco Funds Series 1

7 Invesco ASEAN Equity Fund Portfolio Statement As at 30 November 2013 The Portfolio of Investments - (analysed by geographical sector) (Ordinary shares quoted unless otherwise stated) Investment Holding $ % SINGAPORE (27.48%) City Developments Ltd 469,000 3,728, DBS Group Holdings Ltd 469,568 6,414, Jardine Cycle & Carriage Ltd 204,000 5,732, Keppel Corp Ltd 529,000 4,766, Oversea-Chinese Banking Corp Ltd 1,018,000 8,459, Raffles Medical Group Ltd 1,576,000 3,908, Sembcorp Marine Ltd 1,282,000 4,512, Singapore Telecommunications Ltd 2,119,000 6,272, United Overseas Bank Ltd 485,000 8,080, ,874, MALAYSIA (24.58%) Aeon Co M Bhd 1,559,900 7,300, Axiata Group Bhd 2,093,000 4,353, CIMB Group Holdings Bhd 2,639,000 6,175, Dialog Group BHD 5,063,800 4,658, Lafarge Malaysia Bhd 703,000 2,144, Petronas Dagangan BHD 655,600 6,287, Petronas Gas Bhd 924,200 6,820, Public Bank Bhd 1,519,100 8,658, ,398, INDONESIA (21.20%) Ace Hardware Indonesia Tbk PT 38,827,000 2,329, AKR Corporindo Tbk PT 13,316,500 5,193, Astra International Tbk PT 11,891,500 6,183, Bank Central Asia Tbk PT 7,313,000 5,923, Bank Mandiri Persero Tbk PT 2,773,500 1,775, Perusahaan Gas Negara Persero Tbk PT 8,760,000 3,504, Telekomunikasi Indonesia Persero Tbk PT 30,368,500 5,466, Unilever Indonesia Tbk PT 3,233,000 7,177, Vale Indonesia Tbk PT 12,416,500 2,483, ,036, THAILAND (17.89%) dvanced Info Service PCL 751,800 6,909, Central Pattana PCL 4,541,900 6,131, Kasikornbank PCL 1,379,000 7,253, Siam Cement PCL 302,400 3,710, Siam City Cement PCL 313,300 3,825, Siam Commercial Bank PCL 1,221,700 5,949, ,779, Value of Fund 05 Invesco Funds Series 1

8 Invesco ASEAN Equity Fund Portfolio Statement (continued) As at 30 November 2013 The Portfolio of Investments - (analysed by geographical sector) (Ordinary shares quoted unless otherwise stated) Investment Holding $ % PHILIPPINES (7.99%) Ayala Corp 297,920 3,962, Ayala Land Inc 9,419,800 6,028, Bank of the Philippine Islands 1,133,620 2,380, Jollibee Foods Corp 671,130 2,718, ,089, Total Value of Investments (Cost $196,274,707) 187,178, Total Financial assets 187,178, Cash and Cash Equivalents (see note 6 for details) 3,915, Adjustment from bid-market prices to mid-market prices 474, Other Net Current Liabilities (2,775,056) (1.46) Total Value of the Fund at 30 November ,794, Value of Fund % of Total Assets Analysis of total assets Transferable securities admitted to an official stock exchange listing or dealt in on another regulated market Other assets Invesco Funds Series 1

9 Invesco ASEAN Equity Fund Changes in the Composition of the Portfolio For the year ended 30 November 2013 Purchases Cost $ United Overseas Bank Ltd 13,823,273 Oversea-Chinese Banking Corp Ltd 13,698,543 Jardine Cycle & Carriage Ltd 11,143,043 Public Bank Bhd 11,023,217 Unilever Indonesia Tbk PT 9,857,094 Ace Hardware Indonesia Tbk PT 8,985,716 Siam City Cement PCL 8,642,257 Ayala Land Inc 8,631,011 City Developments Ltd 8,432,857 Siam Commercial Bank PCL 8,362,486 Petronas Gas Bhd 8,291,479 Hong Leong Bank Bhd 8,250,936 AKR Corporindo Tbk PT 7,805,362 Aeon Co M Bhd 7,367,453 Vale Indonesia Tbk PT 6,884,705 Raffles Medical Group Ltd 6,588,458 Kasikornbank PCL 6,144,619 Petronas Dagangan BHD 5,986,238 Central Pattana PCL 5,659,393 Jollibee Foods Corp 5,657,900 Bank of the Philippine Islands 5,637,651 Indo Tambangraya Megah Tbk PT 5,448,297 Telekomunikasi Indonesia Persero Tbk PT 5,401,860 Bank Central Asia Tbk PT 4,854,867 Dialog Group BHD 4,789,769 Matahari Department Store Tbk PT 4,707,369 Sembcorp Marine Ltd 4,632,736 Keppel Corp Ltd 4,584,183 Advanced Info Service PCL 4,519,079 Siam Cement PCL 3,958,266 Banpu PCL 3,923,893 Siam Makro PCL 2,840,854 Perusahaan Gas Negara Persero Tbk PT 2,678,624 Other Purchases 19,523,553 Total cost of purchases since 1 December 2012 $248,737,041 Sales Proceeds $ DBS Group Holdings Ltd 20,607,129 Bank Mandiri Persero Tbk PT 14,844,046 CapitaLand Ltd 13,755,006 Keppel Corp Ltd 12,259,091 CapitaMalls Asia Ltd 9,057,836 Kasikornbank PCL 8,776,270 Hong Leong Bank Bhd 7,715,564 Indofood CBP Sukses Makmur Tbk PT 7,475,103 Singapore Telecommunications Ltd 7,402,599 Genting Bhd 7,215,245 PTT PCL 7,187,172 Sime Darby Bhd 6,601,990 Genting Singapore PLC 6,555,906 Alliance Global Group Inc 6,323,012 Banpu PCL 5,955,764 Megaworld Corp 5,677,401 Bangkok Bank PCL 5,617,907 PTT Global Chemical PCL 5,579,081 United Overseas Bank Ltd 5,551,047 United Tractors Tbk PT 5,474,702 Bank Negara Indonesia Persero Tbk PT 5,394,709 CIMB Group Holdings Bhd 5,120,222 Sembcorp Industries Ltd 4,829,066 Astra International Tbk PT 4,761,213 Minor International PCL 4,735,736 Gamuda Bhd 4,728,021 Matahari Department Store Tbk PT 4,707,043 Metropolitan Bank & Trust Co 4,683,174 Oversea-Chinese Banking Corp Ltd 4,510,661 Astro Malaysia Holdings Bhd 4,268,273 IJM Corp Bhd 4,116,772 Jollibee Foods Corp 3,987,335 Indo Tambangraya Megah Tbk PT 3,980,426 Wilmar International Ltd 3,963,143 Puregold Price Club Inc 3,796,447 Media Nusantara Citra Tbk PT 3,771,400 City Developments Ltd 3,726,336 Jardine Cycle & Carriage Ltd 3,707,659 Ace Hardware Indonesia Tbk PT 3,491,829 Semen Indonesia Persero Tbk PT 3,491,446 Other Sales 72,676,695 Total proceeds of sales since 1 December 2012 $328,079, Invesco Funds Series 1

10 Invesco Japanese Equity Fund Investment Adviser s Report on behalf of the Manager Over the twelve months to the end of November 2013 the Funds A Shares gained 28.3%, compared to the benchmark MSCI Japan index, which returned 32.8%. This placed the Fund in the fourth quartile of its peer group, the GIF OS Japan Large Cap Equity sector, which returned an average of 31.8%. Japanese equity markets have seen spectacular returns over the twelve months to the end of November, and have been among of world s best performing markets in local currency terms. Prime Minister Shinzo Abe s Abenomics have taken center stage, particularly the Bank of Japan s aggressive monetary policy easing, which has weakened the Japanese yen against other major currencies. Meanwhile, fiscal stimulus, including public spending, has helped boost momentum in the domestic economy. Tokyo s victory in the race to host the Summer Olympic Games in 2020, along with large gains in Japanese equities have helped lift consumer confidence, which has been subdued after a decade of deflation, with a notable boost in consumer spending. While the Fund generated positive returns, performance has lagged that of the benchmark index due to our underweight position in the telecoms services sector, and our lack of exposure in brokerage firms, two areas of the market that outperformed significantly. While our holdings in independent financial service provider Orix and air-conditioning equipment manufacturer Daikin Industries made strong positive contributions to overall performance, holdings in Nissan Motor and Mitsubishi Corporation, Japan s largest trading company, detracted as short-term earnings growth disappointed. The strategy of the Fund remains largely unchanged, and we continue to look for stocks across a broad range of sectors that have a competitive edge in successfully expanding their businesses over the longer-term and whose positive fundamentals and prospects have not been priced in to valuations. There have been some notable changes to the structure of the portfolio over the period, with new holdings in; Sumitomo Mitsui Financial Group, a top tier financial conglomerate; Honda Motor, a major automobile manufacturer; and Nidec, a leading manufacturer of small precision motors for electronics and autos. We believe these companies have strong earnings growth potential not only outside Japan but also domestically, and are attractively priced given their current valuations. In turn, we have disposed entirely of holdings whose share prices are closer to what we consider to be fair value after a period of appreciation, including Fujifilm Holdings, Nippon Telegraph and Telephone, the largest telecom service provider, and Daiichi Sankyo, a drug company which has expertise in the cardiovascular and oncology sectors. As we approached the end of the year, investor focus gradually shifted towards the earnings outlook for the next fiscal year and the sustainability of this economic recovery. There appear to be encouraging signs suggesting that we re finally getting out of deflation, which is a necessary condition to achieve steady growth. These include further yen weakness and the good health of bank balance sheets with very few non-performing loans. Deleveraging by corporations has also come to an end, with nearly half of listed companies completely debt free. Labour shortages have started to appear, particularly in non-manufacturing sectors such as construction, which could lead to nationwide wage increases. Furthermore, consumer spending by the older generation has had an incremental impact on consumption as a whole. The so-called third arrow of Abenomics, or economic reform, is expected to be a key driver in reviving Japan s economic growth. As such, we are playing close attention to related issues such as negotiations surrounding the Trans-Pacific Partnership (TPP), which once effective is likely to see further deregulation and reform in Japan, which should help support sustainable economic growth. Dated: 21/01/2014 Invesco Global Asset Management Limited 08 Invesco Funds Series 1

11 Invesco Japanese Equity Fund Fund Performance Percentage change over: (All expressed in the share class base currency, Last Last Last 5 years mid to mid, gross income reinvested) 6 months 12 months (Cumulative) Invesco Japanese Equity A Shares Invesco Japanese Equity B Shares Invesco Japanese Equity C Shares MSCI Japan Index (benchmark) Morningstar GIF OS Japan Large Cap Equity* Source: Morningstar * For comparative purposes The Net Asset Value Information for 30 November 2013 and 30 November 2012 can be found on pages 19 and 20. Price and Income Record The table below shows the highest and lowest NAV prices of Shares in the Funds. There has never been an annual income distribution of the Fund since it redomiciled to Ireland. Calendar Highest Lowest Highest Lowest Highest Lowest NAV Price NAV Price NAV Price NAV Price NAV Price NAV Price A Shares A Shares B Shares B Shares C Shares C Shares Year $ $ $ $ $ $ Calendar Net Income per $2,000 invested in February 1993 at a Net Income Distribution price of $ per Share A Shares B Shares C Shares A Shares B Shares C Shares Year $ $ $ $ $ $ Figures to 31 December 2013 Source: Invesco Global Asset Management Limited. Distributions, if any, are paid annually to A, B and C Shareholders on or after 21 January and details are set out in note 10. Reports on the progress of the Fund are published on or before 31 March and on or before 31 July each year and shall be made available to Shareholders free of charge on request. The price of Shares and the income from them can go down as well as up. Please note that past performance is not necessarily a guide to future performance. 09 Invesco Funds Series 1

12 Invesco Japanese Equity Fund Portfolio Statement As at 30 November 2013 The Portfolio of Investments - (analysed by industrial sector) (Quoted debt instruments unless otherwise stated) Investment Holding $ % CONSUMER, CYCLICAL (27.69%) AOKI Holdings Inc 11, , Daiwa House Industry Co Ltd 38, , FamilyMart Co Ltd 15, , Hitachi High-Technologies Corp 30, , Honda Motor Co Ltd 55,400 2,339, Marubeni Corp 143,000 1,038, Mitsubishi Corp 59,300 1,167, Nagase & Co Ltd 24, , Nifco Inc 32, , Nissan Motor Co Ltd 111,800 1,021, Resorttrust Inc 23, , Sekisui Chemical Co Ltd 114,000 1,334, Shimamura Co Ltd 9, , Suzuki Motor Corp 21, , Toyoda Gosei Co Ltd 19, , Toyota Motor Corp 45,700 2,841, Yamaha Corp 15, , Yamaha Motor Co Ltd 14, , ,695, INDUSTRIAL (26.62%) Amada Co Ltd Npv 96, , Casio Computer Co Ltd 23, , Daifuku Co Ltd 61, , Daikin Industries Ltd 22,700 1,440, East Japan Railway Co 20,200 1,654, Hitachi Ltd 259,000 1,908, JGC Corp 21, , Kyocera Corp 12, , Maeda Road Construction Co Ltd 43, , Minebea Co Ltd 41, , Mitsubishi Heavy Industries Ltd 224,000 1,433, Nidec Corp 12,900 1,247, Obayashi Corp 76, , Sanwa Holdings Corp 141, , Toshiba Corp 229, , Tsubakimoto Chain Co 130, , Yaskawa Electric Corp 63, , ,050, FINANCIAL (23.10%) Chiba Bank Ltd 84, , Daito Trust Construction Co Ltd 9, , Hitachi Capital Corp 52,100 1,502, Mitsubishi Estate Co Ltd 75,000 2,084, Mitsubishi UFJ Financial Group Inc 440,700 2,829, ORIX Corp 129,000 2,350, Relo Holdings Inc 7, , Sumitomo Mitsui Financial Group Inc 59,500 2,943, Tokyu Fudosan Holdings Corp 45, , ,929, CONSUMER, NON-CYCLICAL (10.16%) Astellas Pharma Inc 33,900 2,008, Nippon Meat Packers Inc 48, , Ono Pharmaceutical Co Ltd 15,300 1,157, Pigeon Corp 4, , Seven & I Holdings Co Ltd 53,800 1,977, Value of Fund 6,124, Invesco Funds Series 1

13 Invesco Japanese Equity Fund Portfolio Statement (continued) As at 30 November 2013 The Portfolio of Investments - (analysed by industrial sector) (Ordinary shares quoted unless otherwise stated) Investment Holding $ % BASIC MATERIALS (6.77%) Daicel Corp 136,000 1,078, Denki Kagaku Kogyo KK 110, , Kaneka Corp 72, , Lintec Corp 24, , Mitsubishi Chemical Holdings Corp 98, , Sumitomo Metal Mining Co Ltd 47, , Toyo Ink SC Holdings Co Ltd 109, , ,083, TECHNOLOGY (3.05%) Canon Inc 35,900 1,193, Ricoh Co Ltd 38, , TDK Corp 4, , Value of Fund 1,839, Total Value of Investments (Cost $48,931,279) 58,722, Total Financial assets 58,722, Cash and Cash Equivalents (see note 6 for details) 380, Adjustment from bid-market prices to mid-market prices 70, Other Net Current Assets 1,125, Total Value of the Fund at 30 November ,299, % of Total Assets Analysis of total assets Transferable securities admitted to an official stock exchange listing or dealt in on another regulated market Other assets Invesco Funds Series 1

14 Invesco Japanese Equity Fund Changes in the Composition of the Portfolio For the year ended 30 November 2013 Purchases Cost $ Sumitomo Mitsui Financial Group Inc 2,957,191 Honda Motor Co Ltd 2,307,692 Nidec Corp 979,341 Mitsubishi UFJ Financial Group Inc 909,891 Astellas Pharma Inc 900,084 Daito Trust Construction Co Ltd 869,139 Toyota Motor Corp 858,517 Resorttrust Inc 805,098 East Japan Railway Co 774,143 Hitachi Ltd 754,232 JGC Corp 750,428 ORIX Corp 748,501 Daiwa House Industry Co Ltd 737,797 Chiba Bank Ltd 699,326 Seven & I Holdings Co Ltd 609,545 Shimamura Co Ltd 606,557 Mitsubishi Estate Co Ltd 597,043 Mitsubishi Corp 575,996 Canon Inc 447,880 Tokyu Land Corp 443,706 Hitachi Capital Corp 436,407 Sekisui Chemical Co Ltd 431,097 Marubeni Corp 430,802 Nippon Telegraph & Telephone Corp 418,634 Daicel Corp 417,916 Mitsubishi Heavy Industries Ltd 403,797 Nissan Motor Co Ltd 395,818 AOKI Holdings Inc 374,216 Yaskawa Electric Corp 364,550 Sumitomo Metal Mining Co Ltd 354,969 Daikin Industries Ltd 349,337 Maeda Road Construction Co Ltd 347,004 Relo Holdings Inc 336,957 Yamaha Motor Co Ltd 334,284 Nippon Meat Packers Inc 332,553 Tsubakimoto Chain Co 325,061 Nifco Inc 324,890 Hitachi High-Technologies Corp 322,725 Toshiba Corp 318,686 Ono Pharmaceutical Co Ltd 298,267 Other Purchases 3,659,506 Total cost of purchases since 1 December 2012 $29,309,583 Sales Proceeds $ Nippon Telegraph & Telephone Corp 1,337,241 Toyota Motor Corp 1,224,214 Mitsubishi Heavy Industries Ltd 1,095,400 Mitsubishi Estate Co Ltd 991,869 Obayashi Corp 983,330 Nissan Motor Co Ltd 970,105 TDK Corp 957,017 Mitsubishi UFJ Financial Group Inc 935,187 Mitsubishi Corp 855,810 Kyocera Corp 836,657 FUJIFILM Holdings Corp 776,154 Toshiba Corp 719,026 Daiichi Sankyo Co Ltd 703,316 Mitsui Mining & Smelting Co Ltd 682,761 Hitachi Ltd 678,410 Astellas Pharma Inc 673,315 Daikin Industries Ltd 634,099 Minebea Co Ltd 627,826 ORIX Corp 586,655 Sumitomo Mitsui Financial Group Inc 576,139 Canon Inc 572,095 Marubeni Corp 488,053 Daicel Corp 476,078 Denki Kagaku Kogyo KK 470,540 Yamaha Motor Co Ltd 470,388 Sekisui Chemical Co Ltd 467,768 Yaskawa Electric Corp 442,877 Fujitsu Ltd 437,732 Kurita Water Industries Ltd 413,620 Teijin Ltd 413,160 Seven & I Holdings Co Ltd 406,961 East Japan Railway Co 389,236 Yamaha Corp 381,779 Pigeon Corp 377,782 Nippon Meat Packers Inc 352,878 Ono Pharmaceutical Co Ltd 346,967 Hitachi Capital Corp 331,723 Amada Co Ltd 329,851 Mitsubishi Chemical Holdings Corp 328,563 Tsubakimoto Chain Co 323,209 Nagase & Co Ltd 320,968 Lintec Corp 314,310 Other Sales 5,070,521 Total proceeds of sales since 1 December 2012 $30,771, Invesco Funds Series 1

15 Invesco Pacific Equity Fund Investment Adviser s Report on behalf of the Manager Over the twelve months to the end of November 2013 the Fund s A Shares gained 31.2%, ahead of the benchmark MSCI All Countries Pacific index, which returned 17.9%. This placed the Fund in the first quartile of its peer group, the GIF OS Asia Pacific including Japan sector, which returned an average of 17.7%. Pacific equity markets registered positive returns over what has proven to be an eventful 12 months. In Japan, the election of Prime Minister Shinzo Abe saw equity markets rally strongly, driven higher by a combination of low valuations and expectations of Abenomics. The key driver has been the Bank of Japan s aggressive monetary policy easing measures, designed to overcome deflation and help revitalise the economy, which has helped weaken the yen against other major currencies, a significant tailwind for Japan s exporters. There has also been considerable fiscal stimulus that has provided a boost for the domestic economy. Asian equity markets have been more susceptible to uncertainty surrounding US monetary policy, with South Asian markets especially volatile, particularly those with large current account deficits, such as Indonesia. However, markets have recovered from mid-summer lows thanks to signs of stabilisation in China s economy and the surprise decision by the US Federal Reserve to postpone QE-tapering. The Fund s strong outperformance relative to the benchmark was largely driven by stock selection in Japan, where holdings in a number of economically sensitive sectors added notable value. While our holdings in brokers were the stand-out performers, yen weakness and greater investor risk appetite also helped drive share prices in manufacturers of autos, machine tools and metal products, as well as banks and shipping companies. On the other hand, selected holdings in the electric appliances sector disappointed. Stock selection in China and Korea also added notable value, thanks to strong contributions from holdings in Chinese internet and healthcare stocks, while our holding in Hyundai Motor preference shares made a significant contribution as their discount to the ordinary share class narrowed. We seek to invest in companies whose share prices are substantially below our estimate of fair value. Currently this includes Japanese financials, leading technology companies with significant market share, Chinese internet stocks and franchises with indirect exposure to Asian consumption growth such as Hong Kong based conglomerates. We are underweight in Australia, relative to the benchmark, as we believe there are better opportunities elsewhere and we believe that the Australian dollar is overvalued, even after its recent correction. Over the period we have taken some profits from recent outperformers where the upside potential for share prices is now less evident in our opinion, particularly holdings in Japanese brokers, real estate companies and selected IT names, as well as from holdings in Chinese internet companies. In turn, we have added to existing holdings that we believe the market continues to undervalue considering their earnings growth potential. Elsewhere, we have increased our exposure to India, reflecting our increased confidence in the medium-term outlook, with a more progressive reform agenda likely to be the focus of next year s general elections. Asian economic growth has slowed, but we expect it to be sufficiently high in 2014 to offer attractive investment opportunities. Other reasons for optimism include China s ambitious new reform agenda, which exceeded market expectations. While much depends on successful implementation, there is real potential for meaningful change, particularly in allowing market forces to take a more decisive role in the allocation of resources. The region faces a number of other challenges that require structural reform, in our opinion, but markets have to a large extent discounted this given the current low valuation levels relative to history and against developed markets. Consensus earnings growth forecasts for Asia Pacific ex Japan companies are currently around 12.0% for 2014, bringing valuation levels for the region to 11.7 times 2014 expected earnings. In our opinion, these valuation levels remain supportive. In our view, the medium term-outlook for Japanese equity markets remains positive, with an accommodative monetary policy, healthy domestic economic growth and a supportive external environment, thanks to gradual improvement in the US and signs of recovery in Europe. We believe Japanese stocks are attractively valued in absolute terms and relative to other markets, particularly considering consensus expectations for strong earnings growth this year. Even after this year s rally in equity markets, we are able to find stock specific opportunities where valuations are significantly lower than market averages, but with strong earnings growth potential. Dated: 21/01/2014 Invesco Global Asset Management Limited 13 Invesco Funds Series 1

16 Invesco Pacific Equity Fund Fund Performance Percentage change over: (All expressed in the share class base currency, Last Last Last 5 years mid to mid, gross income reinvested) 6 months 12 months (Cumulative) Invesco Pacific Equity A Shares Invesco Pacific Equity B Shares Invesco Pacific Equity C Shares Invesco Pacific Equity I Shares Invesco Pacific Equity Z Shares n/a n/a n/a MSCI All Countries Pacific Index (benchmark) Morningstar GIF OS Asia Pacific Incl Japan* Source: Morningstar * For comparative purposes The Net Asset Value Information for 30 November 2013 and 30 November 2012 can be found on pages 19 and 20. Price and Income Record The table below shows the highest and lowest NAV prices of Shares in the Fund and the annual income distribution of the Fund in the last 10 years. Calendar Highest Lowest Highest Lowest Highest Lowest Highest Lowest Highest Lowest Year NAV Price NAV Price NAV Price NAV Price NAV Price NAV Price NAV Price NAV Price NAV Price NAV Price A Shares A Shares B Shares B Shares C Shares C Shares I Shares I Shares Z Shares Z Shares $ $ $ $ $ $ $ $ n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Calendar Net Income per $2,000 Year Net Income Distribution invested in October 1992 at a price of $15.78 per Share A Shares B Shares C Shares I Shares Z Shares A Shares B Shares C Shares I Shares Z Shares $ $ $ $ $ $ $ $ n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Figures to 31 December 2013 Source: Invesco Global Asset Management Limited. Distributions, if any, are paid annually to A, B, C and Z Shareholders on or after 21 January and details are set out in note 10. Reports on the progress of the Fund are published on or before 31 March and on or before 31 July each year and shall be made available to Shareholders free of charge on request. The price of Shares and the income from them can go down as well as up. Please note that past performance is not necessarily a guide to future performance. 14 Invesco Funds Series 1

17 Invesco Pacific Equity Fund Portfolio Statement As at 30 November 2013 The Portfolio of Investments - (analysed by geographical sector) (Ordinary shares quoted unless otherwise stated) Investment Holding $ % JAPAN (46.07%) Canon Inc 94,900 3,154, Daiwa Securities Group Inc 196,000 1,903, DMG Mori Seiki Co Ltd 116,000 1,923, East Japan Railway Co 28,400 2,326, Honda Motor Co Ltd 89,500 3,779, Hoya Corp 117,000 3,168, Ibiden Co Ltd 146,300 2,506, Inpex Corp 92,300 1,069, JFE Holdings Inc 123,000 2,766, Kawasaki Kisen Kaisha Ltd 1,127,000 2,682, Konica Minolta Inc 284,000 2,865, Mitsubishi Estate Co Ltd 48,000 1,333, Mitsubishi UFJ Financial Group Inc 555,900 3,568, Mitsui OSK Lines Ltd 349,000 1,549, Nintendo Co Ltd 9,600 1,231, Nippon Paper Industries Co Ltd 238,500 4,345, Nissan Chemical Industries Ltd 151,700 2,381, Nissan Motor Co Ltd 120,200 1,098, Nomura Holdings Inc 427,700 3,387, NTT DoCoMo Inc 135,100 2,176, NTT Urban Development Corp 199,000 2,292, Resona Holdings Inc 577,600 2,870, Shinko Electric Industries Co Ltd 249,000 2,079, Sumco Corp 252,000 2,446, Sumitomo Mitsui Financial Group Inc 77,100 3,814, Taiyo Yuden Co Ltd 88,900 1,139, TDK Corp 60,800 2,838, THK Co Ltd 23, , Tokyo Electron Ltd 32,500 1,756, Toyota Motor Corp 26,000 1,616, Yamaha Motor Co Ltd 215,900 3,447, ,096, SOUTH KOREA (12.76%) DGB Financial Group Inc 50, , E-Mart Co Ltd 6,233 1,584, Hyundai Motor Co (Preference Shares) 18,700 2,235, Korea Electric Power Corp 76,460 2,312, Korea Investment Holdings Co Ltd 31,640 1,210, POSCO 5,386 1,666, Samsung Electronics Co Ltd 2,884 4,068, Samsung Electronics Co Ltd (Preference Shares) 2,430 2,293, Samsung Fire & Marine Insurance Co Ltd 9,118 2,240, Shinhan Financial Group Co Ltd 49,869 2,094, ,512, CAYMAN ISLANDS (10.90%) 51job Inc ADR 9, , Baidu Inc ADR 19,126 3,117, Changyou.com Ltd ADR 55,518 1,536, Charm Communications Inc 74, , E-House China Holdings Ltd 44, , HKR International Ltd 2,334,700 1,120, Hopefluent Group Holdings Ltd 1,841, , Mindray Medical International Ltd 47,019 1,869, NetEase Inc ADR 67,582 4,763, WuXi PharmaTech Cayman Inc 52,172 1,721, Yingde Gases Group Co Ltd 1,072,000 1,147, ,526, Value of Fund 15 Invesco Funds Series 1

18 Invesco Pacific Equity Fund Portfolio Statement (continued) As at 30 November 2013 The Portfolio of Investments - (analysed by geographical sector) (Ordinary shares quoted unless otherwise stated) Investment Holding $ % AUSTRALIA (5.20%) Alumina Ltd 1,012, , Australia & New Zealand Banking Group Ltd 56,173 1,628, Dart Energy Ltd 566,210 56, Fairfax Media Ltd 2,876,561 1,553, Metcash Ltd 385,424 1,067, Newcrest Mining Ltd 51, , Origin Energy Ltd 147,404 1,867, QBE Insurance Group Ltd 64, , ,370, HONG KONG (4.52%) AIA Group Ltd 177, , Cathay Pacific Airways Ltd 425, , Cheung Kong Holdings Ltd 87,000 1,374, China Mobile Ltd 102,000 1,097, Hutchison Whampoa Ltd 236,000 3,004, ,273, TAIWAN (3.45%) China Life Insurance Co Ltd 879, , Chroma ATE Inc 490, , E.Sun Financial Holding Co Ltd 1,507,580 1,010, Taiwan Semiconductor Manufacturing Co Ltd 562,371 1,985, Yageo Corp 2,119, , ,549, INDIA (3.42%) ICICI Bank Ltd 113,777 1,947, Infosys Ltd 23,491 1,259, NTPC Ltd 276, , UPL Ltd 613,389 1,637, ,498, BERMUDA (2.68%) Jardine Matheson Holdings Ltd 32,473 1,638, Noble Group Ltd 1,866,000 1,642, Pacific Basin Shipping Ltd 1,410,000 1,015, Worldsec Ltd 90,000 8, ,303, UNITED KINGDOM (2.07%) HSBC Holdings Plc 231,129 2,579, Standard Chartered Plc 31, , ,322, SINGAPORE (1.44%) Keppel Corp Ltd 97, , United Overseas Bank Ltd 87,000 1,449, ,323, CHINA (1.08%) China Shenhua Energy Co Ltd 290, , Qingling Motors Co Ltd 2,492, , ,732, THAILAND (1.04%) Bangkok Bank PCL 285,700 1,668, Value of Fund PHILIPPINES (0.90%) Filinvest Land Inc 12,786, , LT Group Inc 1,190, , Philippine Long Distance Telephone Co 10, , ,442, Invesco Funds Series 1

19 Invesco Pacific Equity Fund Portfolio Statement (continued) As at 30 November 2013 The Portfolio of Investments - (analysed by geographical sector) (Ordinary shares quoted unless otherwise stated) Investment Holding $ % UNITED STATES (0.83%) Sohu.com Inc 20,735 1,343, NEW ZEALAND (0.32%) Meridian Energy Ltd 650, , Value of Fund Total Value of Investments (Cost $137,313,615) 155,481, Total Financial assets 155,481, Cash and Cash Equivalents (see note 6 for details) 5,677, Adjustment from bid-market prices to mid-market prices 194, Other Net Current Liabilities (527,963) (0.33) Total Value of the Fund at 30 November ,825, % of Total Assets Analysis of total assets Transferable securities admitted to an official stock exchange listing or dealt in on another regulated market Other assets Invesco Funds Series 1

20 Invesco Pacific Equity Fund Changes in the Composition of the Portfolio For the year ended 30 November 2013 Purchases Cost $ Nippon Paper Group Inc 2,332,973 NetEase Inc 2,194,579 Korea Electric Power Corp 2,121,218 ICICI Bank Ltd 2,043,873 Samsung Electronics Co Ltd 2,001,906 Baidu Inc 1,991,833 Origin Energy Ltd 1,812,931 Honda Motor Co Ltd 1,718,646 Canon Inc 1,515,402 Noble Group Ltd 1,410,419 Ibiden Co Ltd 1,373,087 Mitsui OSK Lines Ltd 1,363,972 NTT DoCoMo Inc 1,347,056 Hoya Corp 1,316,668 Nomura Holdings Inc 1,245,663 Kawasaki Kisen Kaisha Ltd 1,244,389 Nissan Motor Co Ltd 1,236,411 JFE Holdings Inc 1,233,994 Nippon Paper Industries Co Ltd 1,214,233 Nissan Chemical Industries Ltd 1,197,696 Nintendo Co Ltd 1,141,454 AIA Group Ltd 1,138,015 Inpex Corp 1,075,962 Mitsubishi UFJ Financial Group Inc 1,057,402 Keppel Corp Ltd 1,053,181 Sumitomo Mitsui Financial Group Inc 1,049,260 Shinhan Financial Group Co Ltd 1,039,477 Alumina Ltd 1,030,385 Tokyo Electron Ltd 1,027,910 Resona Holdings Inc 996,615 East Japan Railway Co 944,294 Sumco Corp 926,182 Chroma ATE Inc 913,956 Yamaha Motor Co Ltd 883,318 Shinko Electric Industries Co Ltd 874,495 Yageo Corp 873,959 Samsung Electronics Co Ltd 871,213 China Life Insurance Co Ltd 850,283 China Shenhua Energy Co Ltd 842,187 NTT Urban Development Corp 783,522 NTPC Ltd 759,063 Other Purchases 19,880,163 Total cost of purchases since 1 December 2012 $71,929,245 Sales Proceeds $ Daiwa Securities Group Inc 3,292,637 Mazda Motor Corp 3,001,277 Taiyo Yuden Co Ltd 2,668,756 Tokyo Electron Ltd 2,573,232 Nomura Holdings Inc 2,534,867 Mitsubishi Estate Co Ltd 2,130,343 Hon Hai Precision Industry Co Ltd 1,884,162 E-House China Holdings Ltd 1,883,325 Baidu Inc 1,613,397 NTT Urban Development Corp 1,542,666 DMG Mori Seiki Co Ltd 1,513,207 Westpac Banking Corp 1,440,433 Toyota Motor Corp 1,320,985 Venture Corp Ltd 1,271,299 Sohu.com Inc 1,270,787 Sumitomo Mitsui Financial Group Inc 1,096,916 Hoya Corp 1,052,009 Honda Motor Co Ltd 1,001,254 Jardine Matheson Holdings Ltd 990,174 Mitsubishi UFJ Financial Group Inc 962,008 Samsung Electronics Co Ltd 927,517 KT&G Corp 912,911 NetEase Inc 868,869 Filinvest Land Inc 866,644 China Mobile Ltd 822,701 Yageo Corp 812,590 CNOOC Ltd 795,951 Mindray Medical International Ltd 775,071 DGB Financial Group Inc 739,246 Shinko Electric Industries Co Ltd 711,896 Wumart Stores Inc 625,224 Far Eastern New Century Corp 607,036 Nissha Printing Co Ltd 599,225 Banpu PCL 590,217 Amada Co Ltd 585,633 Daphne International Holdings Ltd 579,304 Other sales 9,592,503 Total proceeds of sales since 1 December 2012 $56,456, Invesco Funds Series 1

21 Balance Sheet As at 30 November 2013 Invesco Invesco Invesco ASEAN Equity Japanese Pacific Equity Fund Equity Fund Fund Notes $ $ $ Assets Cash and cash equivalents 1(d)/6 3,915, ,603 5,677,182 Balances due from brokers 1(e) 143,597 Amounts due on creations 1(p) 4,093, ,625 Financial assets at fair value through profit or loss 187,178,575 58,722, ,481,907 Other accrued income and prepaid expenses 114, , ,853 Total assets 191,208,709 63,651, ,337,567 Liabilities Balances due to brokers 1(e) 3,216, ,283 Amounts due on liquidations 1(p) 888,735 2, ,951 Distribution payable 10 1,585,556 7, ,190 Management fee payable 1(g) 256,270 80, ,026 Administrator s fee payable 1(g) 69,441 21,851 54,073 Accrued expenses 1(g) 89,451 94,435 60,918 Total liabilities (excluding net assets attributable to holders of Redeemable Participating Shares) 2,889,453 3,422,353 1,706,441 Net assets attributable to holders of redeemable participating Shares (bid prices) 188,319,256 60,228, ,631,126 Adjustment from bid prices to mid-market prices 1(m) 474,910 70, ,719 Net assets attributable to holders of redeemable participating Shares (mid-market prices) 188,794,166 60,299, ,825,845 Net Asset Value per A Shares Net Asset Value per A-Acc HKD Shares (as expressed in HKD) Net Asset Value per B Shares Net Asset Value per C Shares Net Asset Value per Z Shares Net Asset Value per I Shares (as expressed in EUR) The accompanying notes 1 to 15 on pages 25 to 38 form part of these financial statements. Signed for and on behalf of Invesco Global Asset Management Limited on 20 March Director: C. O Sullivan Director: O. Carroll 19 Invesco Funds Series 1

22 Balance Sheet As at 30 November 2012 Invesco Invesco Invesco ASEAN Equity Japanese Pacific Equity Fund Equity Fund Fund $ $ $ Assets Cash and cash equivalents 5,281, , ,342 Cash collateral 1,703,826 Balances due from brokers 1,702,295 6,337 Amounts due on creations 12, , ,777 Financial assets at fair value through profit or loss 267,496,043 46,189, ,696,147 Other accrued income and prepaid expenses 252, , ,153 Total assets 274,744,094 48,685, ,545,756 Liabilities Bank overdraft 437,255 Cash collateral 1,703,826 Balances due to brokers 2,602,623 Amounts due on liquidations 482,171 14, ,283 Distribution payable 2,128,459 6, ,016 Management fee payable 71,776 13,134 19,190 Administrator s fee payable 18,781 3,925 7,350 Accrued expenses 1,383,986 78,466 89,908 Total liabilities (excluding net assets attributable to holders of Redeemable Participating Shares) 7,125,051 1,820, ,747 Net assets attributable to holders of redeemable participating Shares (bid prices) 267,619,043 46,864, ,653,009 Adjustment from bid prices to mid-market prices 2,203,670 70, ,432 Net assets attributable to holders of redeemable participating Shares (mid-market prices) 269,822,713 46,935, ,894,441 Net Asset Value per A Shares Net Asset Value per A-Acc HKD Shares (as expressed in HKD) Net Asset Value per B Shares Net Asset Value per C Shares Net Asset Value per I Shares (as expressed in EUR) November 2011 Total NAV of the Fund 249,499,082 58,428, ,945,134 Net Asset Value per A Share Net Asset Value per A-Acc HKD Share (as expressed in HKD) Net Asset Value per B Share Net Asset Value per C Share Net Asset Value per I Share (as expressed in EUR) Invesco Funds Series 1

23 Income Statement For the year ended 30 November 2013 Invesco Invesco Invesco ASEAN Equity Japanese Pacific Equity Fund Equity Fund Fund Notes $ $ $ Revenue Interest income 1(f) 2, ,552 Income from stock lending 8 10,912 Dividend income 1(f) 6,841,476 1,112,068 2,863,849 Net (loss)/gain on financial assets and liabilities at fair value through profit or loss (realised and unrealised) (1,779,273) 13,868,450 35,297,842 Total investment income 5,064,654 14,991,450 38,163,243 Expenses Management fee 1(g) 3,221, ,838 1,776,214 Administrator s fee 1(g) 879, , ,716 Trustee fee 1(g) 14,493 3,354 8,273 Custodian fee 1(g) 102,811 9,178 31,441 Auditor s fee 1(g) 11,682 23,148 15,392 Other operating expenses 1(g) 125, , ,108 Total operating expenses 4,354,924 1,210,705 2,420,144 Operating profit 709,730 13,780,745 35,743,099 Finance costs Bank overdraft interest 1(d)/6 (1,529) (244) (743) Distributions to holders of Redeemable Participating Shares 1(k) (1,585,556) (7,216) (349,190) Net equalisation 1(h) (368,056) 25 33,554 Total finance costs (1,955,141) (7,435) (316,379) (Loss)/Profit before tax (1,245,411) 13,773,310 35,426,720 Withholding tax on dividends and other investment income 1(o) (535,693) (79,457) (217,091) Movement in provision for capital gains tax on investments (175,604) 23,493 (Decrease)/increase in net assets attributable to holders of redeemable participating Shares (bid market values) (1,956,708) 13,693,853 35,233,122 Movement on adjustment from bid market prices to mid market prices 1(m) (1,728,760) (151) (46,713) (Decrease)/increase in net assets attributable to holders of redeemable participating Shares (mid market values) (3,685,468) 13,693,702 35,186,409 The accompanying notes 1 to 15 on pages 25 to 38 form part of these financial statements The Funds had no recognised gains or losses in the financial year other than those dealt with in the Profit and Loss account. Gains and losses arose solely from continuing operations. Signed for and on behalf of Invesco Global Asset Management Limited on 20 March Director: C. O Sullivan Director: O. Carroll 21 Invesco Funds Series 1

24 Income Statement For the year ended 30 November 2012 Invesco Invesco Invesco ASEAN Equity Japanese Pacific Equity Fund Equity Fund Fund $ $ $ Revenue Interest income 2, Income from stock lending - 20,872 - Dividend income 7,610,204 1,288,034 2,876,207 Net gain/(loss) on financial assets and liabilities at fair value through profit or loss (realised and unrealised) 41,940,941 (538,671) 8,051,214 Total investment income 49,553, ,235 10,928,047 Expenses Management fee 3,704, ,860 1,456,517 Administrator s fee 996, , ,092 Trustee fee 18,108 3,549 7,453 Custodian fee 106,829 9,349 36,512 Auditor s fee 11,534 23,078 15,050 Other operating expenses 117, , ,687 Total operating expenses 4,955,616 1,205,402 2,068,311 Operating profit/(loss) 44,598,256 (435,167) 8,859,736 Finance costs Bank overdraft interest (466) (162) (923) Distributions to holders of Redeemable Participating Shares (2,128,458) (6,510) (617,016) Net equalisation 13,322 (13,976) (39,027) Total finance costs (2,115,602) (20,648) (656,966) Profit/(loss) before tax 42,482,654 (455,815) 8,202,770 Withholding tax on dividends and other investment income (544,534) (90,162) (190,114) Movement in provision for capital gains tax on investments (1,444,564) - (45,092) Increase/(decrease) in net assets attributable to holders of redeemable participating Shares (bid market values) 40,493,556 (545,977) 7,967,564 Movement on adjustment from bid market prices to mid market prices 1,235,093 (37,409) 39,695 Increase/(decrease) in net assets attributable to holders of redeemable participating Shares (mid market values) 41,728,649 (583,386) 8,007, Invesco Funds Series 1

25 Statement of Changes in the Net Assets Attributable to Holders of Redeemable Participating Shares For the year ended 30 November 2013 Invesco Invesco Invesco ASEAN Equity Japanese Pacific Equity Fund Equity Fund Fund $ $ $ Net assets attributable to holders of redeemable participating Shares at beginning of year (bid prices) 267,619,043 46,864, ,653,009 Adjustment from bid prices to mid-market prices 2,203,670 70, ,432 Net assets attributable to holders of redeemable participating Shares at beginning of year (mid-market prices) 269,822,713 46,935, ,894,441 (Decrease)/Increase in net assets attributable to holders of redeemable participating Shares at bid prices (1,956,708) 13,693,853 35,233,122 Movement on adjustment from bid prices to mid-market prices (1,728,760) (151) (46,713) (Decrease)/Increase in net assets attributable to holders of redeemable participating Shares (3,685,468) 13,693,702 35,186,409 Share Transactions Proceeds from redeemable participating Shares issued 44,457,162 50,423,241 80,699,824 Cost of redeemable participating Shares redeemed (121,800,241) (50,753,024) (59,954,829) Net assets attributable to holders of redeemable participating Shares at the end of year (mid-market prices) 188,794,166 60,299, ,825, Invesco Funds Series 1

26 Statement of Changes in the Net Assets Attributable to Holders of Redeemable Participating Shares For the year ended 30 November 2012 Invesco Invesco Invesco ASEAN Equity Japanese Pacific Equity Fund Equity Fund Fund $ $ $ Net assets attributable to holders of redeemable participating Shares at beginning of year (bid prices) 248,530,505 58,320, ,743,397 Adjustment from bid prices to mid-market prices 968, , ,737 Net assets attributable to holders of redeemable participating Shares at beginning of year (mid-market prices) 249,499,082 58,428, ,945,134 Increase/(decrease) in net assets attributable to holders of redeemable participating Shares at bid prices 40,493,556 (545,977) 7,967,564 Movement on adjustment from bid-market prices to mid-market prices 1,235,093 (37,409) 39,695 Increase/(decrease) in net assets attributable to holders of redeemable participating Shares 41,728,649 (583,386) 8,007,259 Share Transactions Proceeds from redeemable participating Shares issued 83,368,817 26,512,204 47,196,605 Cost of redeemable participating Shares redeemed (104,773,835) (37,421,460) (68,254,557) Net assets attributable to holders of redeemable participating Shares at the end of year (mid-market prices) 269,822,713 46,935, ,894, Invesco Funds Series 1

27 Notes to the Financial Statements For the year ended 30 November Significant accounting Policies (a) Basis of Preparation The Financial Statements have been prepared in accordance with accounting standards generally accepted in Ireland ( Irish GAAP ) and Irish Statute comprising the European Communities (Undertakings for Collective Investment in Transferable Securities) 2011 (as amended). Accounting Standards generally accepted in Ireland in preparing financial statements giving a true and fair view are those published by the Institute of Chartered Accountants in Ireland and issued by the Accounting Standards Board. The Financial Statements have been prepared in accordance with the historical cost convention, as modified by the revaluation of financial assets and financial liabilities held at fair value through profit or loss. All references to net assets throughout this document refer to net assets attributable to holders of redeemable participating Shares unless otherwise stated. The format and certain wording of the financial statements has been adapted from that contained in FRS3 Reporting Financial Performance and Irish Statute, to one which, in the opinion of the Directors of the Manager, more appropriately reflects the Company s business as an investment company. The investments of the Funds have been valued at the market dealing bid prices at 12.00pm (Irish time) on 30 November The preparation of the financial statements in conformity with Irish GAAP requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Fund s accounting policies. Actual results could differ from these estimates and these differences could be material. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates, if any, are recognised in the year in which the estimate is revised if the revision affects only that year, or in the year of the revision, and future years if the revision affects both current and future years. All references to net assets throughout this document refer to net assets attributable to holders of redeemable participating Shares unless otherwise stated. The fair value of financial instruments, for financial statement purposes, traded in active markets is based on bid prices at the Balance Sheet date. The quoted market price used for financial assets held by the Fund is the current bid price on the market on which these assets are traded or admitted for trading (being the market which is the sole, or in the opinion of the Directors of the Manager, the principal market on which the investment in question is listed, quoted or dealt in). This is different to the valuation methodology indicated in the Prospectus where investments or assets listed, quoted or dealt in on a regulated market shall be valued at the valuation point at the mid-market (being the average of the bid and offer prices) or last traded price, depending on market convention, on the market where these assets are traded or admitted for trading (being the market which is the sole, or in the opinion of the Directors of the Manager, the principal market on which the investments in question is listed, quoted or dealt in). (b) Financial assets and liabilities at fair value The Funds have classified all investments into the fair value through profit or loss category. This has two sub-categories: (1) financial assets and liabilities held for trading and (2) those designated by management at fair value through profit or loss on adoption of FRS 26. Financial assets or liabilities held for trading are acquired or incurred principally for the purposes of selling or repurchasing in the short term. The investments are initially recognised at fair value and transaction costs are expensed as incurred. The investments of the Funds have been valued at the market dealing bid prices at 12.00pm (Irish time) on 30 November Investment transactions are accounted for on the trade date up to 12.00pm on 30 November Applications which are received prior to the dealing cut-off point (12.00pm) will, if accepted, be dealt with on the basis of the net asset value per share of the relevant class calculated at the next valuation point. Investments are initially recognised at fair value and are derecognised when the rights to receive cash flow from these investments have expired or the Fund has transferred substantially all rights and rewards of ownership. Realised gains/losses on investments disposals are calculated on the Average Cost Method and are recognised in the Income Statement. If a quoted market price is not available on a recognised stock exchange or from a broker/dealer for non-exchange-traded financial instruments, the fair value is estimated with care and in good faith by a competent person and approved by the Fund Manager, on behalf of the Directors of the Manager. No investments were valued in this manner as at 30 November 2013 and 30 November (c) Foreign currency translation (i) Functional and presentation currency Items included in each Fund s financial statements are measured using the currency of the primary economic environment in which it operates ( the functional currency ). This is the US Dollar ($). The US Dollar is also the presentation currency. The financial statements are presented in the Funds functional and presentation currency and rounded to the nearest whole number. They are prepared on the fair value basis for financial assets and financial liabilities at fair value through profit or loss and derivative financial instruments. Other financial assets and financial liabilities are stated at amortised cost or redemption amount (redeemable Shares). (ii) Assets and liabilities in foreign currencies are translated into US Dollars at the rates of exchange ruling at the Balance Sheet date. Income and expenditure transactions are translated at the rates of exchange ruling at the date of the transactions. The principal exchange rates used: US$ November November 2012 Australian Dollar Chinese Renminbi Euro Hong Kong Dollar Indian Rupee Indonesian Rupiah 11, , Japanese Yen Malaysian Ringit New Zealand Dollar Philippine Peso Singapore Dollar South Korean Won 1, , Taiwan Dollar Thai Baht Pounds Sterling (d) Cash and cash equivalents Cash and cash equivalents includes cash in hand, deposits held at call with banks, and other short-term highly liquid investments with original maturities of three months or less. Bank overdrafts are included in liabilities on the Balance Sheet. (e) Due from/to brokers Amounts due from/to brokers represent payables for securities purchased and receivables for securities sold that have been contracted for but not yet delivered or settled as at year end. 25 Invesco Funds Series 1

28 Notes to the Financial Statements (continued) For the year ended 30 November Significant accounting Policies (continued) (f) Dividend and interest income Dividends are credited to the Income Statement on the dates on which the relevant securities are listed as ex-dividend. Deposit Interest Income is accrued on a daily basis using the effective interest rate method. Income is shown gross of any non-recoverable withholding taxes, which are disclosed separately in the Income Statement, and net of any tax credits. (g) Expenses The Funds expenses are recognised on an accruals basis and include value added tax where appropriate. (h) Equalisation An equalisation account is maintained by each Fund so that the amount distributed on all classes of Shares will be the same for all Shares of the same type, notwithstanding different dates of issue. A sum equal to that part of the issue price of a Share which reflects income (if any) accrued up to the date of issue will be deemed to be an equalisation payment. It will be treated as repaid to Shareholders with the first distribution or accumulation for the relevant Fund to which the Shareholder is entitled in the same accounting period as that in which the Shares are issued. Equalisation will not be operated in respect of the first issue of Shares by a fund. (i) Financial Reporting Standard No. 1 The Funds have availed of the exemption available to Open-Ended Investment Funds under Financial Reporting Standard No. 1 not to prepare a Cash Flow Statement. (j) Forward Foreign Exchange Contracts The unrealised gain or loss on open forward foreign exchange contracts is calculated as the difference between the contracted rate and the rate to close out the contract at the Balance Sheet date. Realised gains or losses include net gains on contracts which have been settled or offset on other contracts. Net realised gains or losses on forward foreign exchange contracts are a component of net gains/losses on financial assets and financial liabilities at fair value through profit or loss (see Note 9 for details). (k) Distributions payable to holders of redeemable participating Shares Proposed distributions to holders of redeemable participating Shares are classified as finance costs in the Income Statement when they are ratified by the Board of Directors of the Manager. (l) Redeemable Participating Shares Redeemable participating Shares are redeemable at the Shareholder s option and are classified as financial liabilities. The distribution on these redeemable participating Shares is recognised in the Income Statement as finance costs. The participating Shares can be put back to the relevant Fund at any time for cash equal to a proportionate share of the Funds net asset value. The participating Shares are carried at the redemption amount that is payable at the Balance Sheet date if the Shareholder exercised its right to put the share back to each Fund. (m) Value of investments To determine the net asset value of each Fund for subscriptions and redemptions, investments have been valued based on the mid market prices at 12.00pm (Irish time) on the relevant trading day. For Financial Statements purposes, investments are valued based on bid prices and an adjustment to mid market prices is shown. (2012: an increase of $70,756), and an increase of $194,719 as of 30 November 2013 (2012: an increase of $241,432) for Pacific Equity Fund. The amount of the adjustment recognised in the Income Statement is a decrease of $1,728,760 (2012: an increase of $1,235,093) for ASEAN Equity Fund, a decrease of $151 for Japanese Equity Fund (2012: a decrease of $37,409), and a decrease of $46,713 (2012: an increase of $39,695), for Pacific Equity Fund. The net asset value per Share is disclosed in note 7. There are no investments with a zero value in the Fund. (n) Swing Pricing. Securities are valued as outlined in note 1(b). However, in order to mitigate the effects of dilution, the Funds have implemented a policy of Swing Pricing. In the best interest of Shareholders, the Directors of the Manager may allow for the net asset value to be adjusted, using bid or ask market quotation rather than mid, depending on the net share activity arising from subscriptions, redemptions or switching in a fund for a given business day. The Funds operate partial swing only. That is the Funds will not swing to either a bid or ask price basis daily, but only when a pre determined level of shareholder activity is exceeded. High redemption level triggers a swing to a bid price basis, whereas high subscription level triggers a swing to ask price basis. The Directors of the Manager have the ability to place a fund on constant swing depending on the recent Shareholder activity trends of a fund. (o) Withholding tax The Fund currently incurs withholding taxes imposed by certain countries on investment income. Such income is recorded gross of withholding taxes in the Income Statement. Withholding taxes are shown as a separate item in the Income Statement. (p) Amounts due on creations/liquidations Amounts due on creations and liquidations represent receivables for creation of shares and payables for liquidation of Shares that have been contracted for but not yet delivered by the year end. Liquidations and creations paid after the year end, but based upon year end net asset values, are reflected as amounts due on creations and liquidations in the Balance Sheet as at 30 November (q) Offsetting Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. 2. UK Reporting The A and C Distribution Share Classes currently have UK Reporting Status. The Statement of Reportable Income for the financial year ended 30 November 2013 will be available through the following Invesco websites. reportableincome/ e/iiadviser/reportableincome The Fund will apply for UK Reporting Status for the following new share classes for the year ended 30 November Invesco Asean Equity Fund Z (AD) USD Invesco Pacific Equity Fund Z (AD) USD The adjustment from bid to mid results in an increase in the value of investments of $474,910 as of 30 November 2013 (2012: an increase of $2,203,670) for ASEAN Equity Fund, $70,605 for Japanese Equity Fund 26 Invesco Funds Series 1

29 Notes to the Financial Statements (continued) For the year ended 30 November Soft Commissions and Related Party Transactions The Funds, (consistent with obtaining the best net result, including best execution), may enter into agreements with counterparties whereby those counterparties may make payments for investment services provided to the Funds. Investment services are used by the Funds to improve or add to the services provided to its clients. Although each and every service may not be used to service each and every account managed by the Funds, the Directors of the Manager consider that those investment services received are, in the aggregate, of significant assistance in fulfilling its investment responsibilities and are of demonstrable benefit to all clients. Only services that in the opinion of the Manager assist in the provision of investment services to the Funds clients will be paid for by counterparties. Allowable investment services include services that provide assistance to the Funds in their investment performance. Those services include, but are not necessarily limited to, furnishing analysis, research and advisory services including economic factors and trends, portfolio valuation and analysis, performance measurement, market prices services and the use of specialised computer software and hardware or other information facilities. The Funds select counterparties to execute transactions on the basis that transactions will only be executed provided the placing of orders will not operate against the best interest of the Fund s clients and that the multiple is at a level which is generally accepted market practice. The Funds will endeavour to obtain best execution on all transactions for all clients. In addition, clients may direct the Funds to pay commission to counterparties for products and services that would otherwise have to be paid for. In such cases, the commission is used for the exclusive benefit of the client whose transactions generated that commission. The Funds will endeavour to maintain the highest possible regulatory standards world-wide. The Manager, Administrator, Global Distributor and Registrar (until 20 May (see note 13)), Invesco Global Asset Management Limited are deemed to be Related Parties under Financial Reporting Standard No. 8. Fees charged, out of the fund, by the Manager and Administrator fees are disclosed in the Income Statement on page 21. Amounts payable at the year end are disclosed in the Balance Sheet on page 19. The Manager may pay a portion of its administration fees to BNY Mellon Fund Services (Ireland) Limited, the Sub-Administrator, in consideration for the Sub-Administrator providing certain administration functions to the Funds. Fees to the Global Distributor are paid from the Management fee and fees paid to the Administrator and the Registrar are paid from the Administration fee. The Manager, Invesco Global Asset Management Limited is a wholly owned subsidiary of Invesco UK Limited, which is a wholly owned subsidiary of Invesco Limited, the group parent company. Invesco UK Limited held a beneficial interest in the shares representing approximately the following percentages of the total number of shares in issue of the relevant fund class: Seed Capital Invesco UK Limited held the following Redeemable Participating Shares in the Funds and class as detailed below: Number of Number of Number of Number of Shares Percentage Shares at the Shares acquired Shares redeemed at year end of Total start of the year in the year in the year Shares For the Year ended 30 November 2013 Invesco ASEAN Equity Fund Z Shares Invesco ASEAN Equity Fund A-Acc HKD Shares Invesco Pacific Equity Fund I Shares Invesco Pacific Equity Fund Z Shares Number of Number of Number of Number of Shares Percentage Shares at the start Shares acquired Shares redeemed at year end of Total of the year in the year in the year Shares For the Year ended 30 November 2012 Invesco ASEAN Equity Fund A-Acc HKD Shares Invesco Pacific Equity Fund I Shares Director s fees are not paid from the Funds. Director fees are paid by Invesco Global Asset Management Limited. There were no holdings by the Directors of the Manager in the Funds for the year under review. 27 Invesco Funds Series 1

30 Notes to the Financial Statements (continued) For the year ended 30 November Financial Investments and Associated Risks Risk Management In pursuing its investment objectives set out within the section describing the Funds Investment Policies, each Fund holds a number of financial instruments, these comprise: - Equity and non-equity Shares. These are held in accordance with each Funds investment objectives and policies. - Cash, liquid resources and short-term debtors and creditors that arise directly from operations; and - Shareholders Funds which represent investor monies which are invested on their behalf. The main risks arising from the Funds financial instruments are market price, (incl. foreign currency and price and interest rate), liquidity, credit and custodian risks. The Manager reviews policies for managing these risks and they are summarised below. Global Exposure Following the assessment of the investment policy of each Fund, Invesco Global Asset Management Limited has decided to use Value at Risk (VaR) for the assessment of the global exposure of each Fund. Value-at-Risk (VaR) is a statistical measurement. It intends to measure the maximum potential loss at a given confidence level (probability) over a specific time period under normal market conditions. All of the positions within the portfolio are taken into account for the VaR calculation, not just derivatives. Relative VaR is calculated daily using a VaR risk model based on a two years historical simulation methodology. This method for calculating VaR contains no standard distribution assumption and assumes that history repeats itself. The calculation standards used for the VaR model are in compliance with the provisions in box 15 of ESMA Guidelines on Risk Measurement and the calculation of Global Exposure and Counterparty Risk for UCITS (Ref:10-788) ( ESMA Guidelines ). The Relative VaR of a UCITS cannot be more than 2 times the VaR of the reference portfolio. Invesco Global Asset Management Limited monitors that the VaR of the UCITS / 2* VaR of the reference portfolio is not greater than 100%. The calculation of the Relative VaR is carried out in accordance with the following parameters: one-tailed confidence interval of 99%; holding period equivalent to 1 month (i.e. 20 business days); effective observation period (history) of risk factors of 500 business days (ESMA Guidelines require at least 250 business days); and daily calculation. In line with ESMA Guidelines, as the Funds use the VaR approach to monitor the global exposure, Invesco Global Asset Management Limited calculates the leverage for each Fund on a daily basis, as the sum of the absolute value of the notionals of the derivatives used. With respect to financial derivative instruments which do not have a notional value attached to them, the calculation of the value is based upon the market value of the equivalent position of the underlying asset that is attached to the financial derivative instrument and applied consistently and appropriately. The average level of leverage figures provided below does not take into account any netting and hedging arrangements that the Funds may have in place at any time even though these netting and hedging arrangements are used for risk reduction purpose. The below table details the Relative VaR approach and the reference portfolio for each Fund. The table also details the minimum, maximum and average daily VaR utilisation that occurred during the one year period ending 30 November The table also details the daily average level of leverage for each Fund during the one year period ending 30 November Global Exposure Leverage Fund Name Period of Method Used to Method Used to Calculate VAR Reference VAR Limits Reached for last VAR Limits Leverage Level Leverage Observation Calculate Global Portfolio for Financial Year Reached During Calculation Exposure Type of Parameters Using Lowest Highest Average Regulatory Maximum the Financial Method Used Model Relative VAR Limits* Internal Year (Commitment, (Confidence (based on Limits (Average levels Absolute VAR, (Historical interval, holding daily data) Defined as a percentage Relative VAR*) simulation, period, observation of NAV, Monte period ) calculated at Carlo ) least twice per month) 99% confidence Sum of the Invesco ASEAN 1st Dec Historical MSCI South Relative VaR level, 20 days, % 53.09% 42.83% 100% 75% 0.00% notionals of the Equity Fund 30 Nov 2013 Simulation East Asia years of risk factors derivatives 99% confidence Sum of the Invesco Japanese 1st Dec Historical Relative VaR level, 20 days, 2 MSCI Japan 44.72% 57.58% 49.40% 100% 75% 0.00% notionals of the Equity Fund 30 Nov 2013 Simulation years of risk factors derivatives 99% confidence Sum of the Invesco Pacific 1st Dec Historical MSCI AC Relative VaR level, 20 days, % 55.01% 49.12% 100% 70% 0.00% notionals of the Equity Fund 30 Nov 2013 Simulation Pacific years of risk factors derivatives 28 Invesco Funds Series 1

31 Notes to the Financial Statements (continued) For the year ended 30 November Financial Investments and Associated Risks (continued) Global Exposure (continued) The below table details the Relative VaR approach and the reference portfolio for each Fund during the one year period ending 30 November The table also details the daily average level of leverage for each Fund during the one year period ending 30 November Global Exposure Leverage Fund Name Period of Method Used to Method Used to Calculate VAR Reference VAR Limits Reached for last VAR Limits Leverage Level Leverage Observation Calculate Global Portfolio for Financial Year Reached During Calculation Exposure Type of Parameters Using Lowest Highest Average Regulatory Maximum the Financial Method Used Model Relative VAR Limits* Internal Year (Commitment, (Confidence (based on Limits (Average levels Absolute VAR, (Historical interval, holding daily data) Defined as a percentage Relative VAR*) simulation, period, observation of NAV, Monte period ) calculated at Carlo ) least twice per month) 99% confidence Sum of the Invesco ASEAN 1st Dec Historical MSCI South Relative VaR level, 20 days, % 52.84% 49.53% 100% 90% 0.00% notionals of the Equity Fund 30 Nov 2012 Simulation East Asia years of risk factors derivatives 99% confidence Sum of the Invesco Japanese 1st Dec Historical Relative VaR level, 20 days, 2 MSCI Japan 46.48% 56.72% 53.05% 100% 90% 0.00% notionals of the Equity Fund 30 Nov 2012 Simulation years of risk factors derivatives 99% confidence Sum of the Invesco Pacific 1st Dec Historical MSCI AC Relative VaR level, 20 days, % 50.24% 47.77% 100% 90% 0.00% notionals of the Equity Fund 30 Nov 2012 Simulation Pacific years of risk factors derivatives Market Price Risk Market risk arises mainly from the uncertainty about future prices of financial instruments held. It represents the potential loss the Funds might suffer through holding market positions in the face of price movements. The Manager meets regularly to consider the asset allocation of the Portfolio in order to minimise the risk associated with particular countries or industry sectors whilst continuing to follow the investment objective. An individual Investment Adviser has responsibility for monitoring the existing Portfolio selected in accordance with the overall asset allocation described above and seeks to ensure individual stocks also meet the risk reward profile that is acceptable. The Manager does not use derivative instruments, with the exception of forwards, to hedge the investment portfolio against market risk, as in their opinion the cost of such a process would result in an unacceptable reduction in the potential for capital growth. As the majority of the Funds financial instruments are carried at fair value with fair value changes recognised in the Income Statement, all changes in market conditions will directly affect net investment income. All securities investments present a risk of loss of capital. The Investment Adviser moderates this risk through careful selection of securities and other financial instruments with specified limits. These limits are defined in the Investment Objectives and Policies shown on page 1. The Funds overall market positions are monitored on a daily basis by the Funds Investment Adviser. The Investment Risk Manager reviews Fund performance daily and reports to the Board of Directors of the Manager quarterly. The Manager reviews Var of the Funds as a way to manage market price risk. The Funds market price risk is managed through diversification of the investment portfolio ratios by exposures. The portfolio statements beginning on pages 5, 10 and 15 give a detailed breakdown of the Funds securities grouped either by geographic or industry exposure at bid value. Interest rate risk The majority of the Funds financial assets and liabilities are non interest bearing. As a result, the Funds are not subject to significant amounts of risk due to fluctuations in the prevailing levels of market interest rates, any excess cash & cash equivalents are invested at short term markets interest rates. Foreign Currency Risk The Funds hold assets denominated in currencies other than the functional currency. They are therefore exposed to currency risk, as the value of the securities denominated in other currencies will fluctuate due to changes in exchange rates. The Funds receive income in currencies other than functional currency and the functional currency values of this income can be affected by movements in exchange rates. The Funds convert all receipts of income into functional currency on or near date of receipt. The Investment Adviser monitors the Funds foreign currency exposure on a daily basis. The Board of Directors of the Manager review the Funds foreign exchange exposure on a quarterly basis. 29 Invesco Funds Series 1

32 Notes to the Financial Statements (continued) For the year ended 30 November Financial Investments and Associated Risks (continued) Liquidity risk Liquidity risk is the risk that the Funds may not be able to generate sufficient cash resources to settle its obligation in full as they fall due or can only do so on terms that are materially disadvantageous. The Funds are exposed to daily cash redemptions of redeemable participating Shares. They therefore invest the majority of their assets in investments that are traded in an active market and can be readily disposed of; they invest only a limited proportion of their assets in investments not actively traded on a recognised market. All Financial Liabilities including redeemable participating Shares fall within one month maturity. The Funds may be overdrawn up to 10% of the NAV on a temporary basis to meet redemption requests. The Fund may also limit total redemption requests to 10% of the NAV in any one day. All redemptions are paid on the fourth business day after the redemption order is accepted. The majority of the Financial Assets held with the Funds are settled on a T +3 basis allowing sufficient time for the Investment Adviser to raise cash to meet redemption liabilities. In accordance with the Funds policy, the Investment Adviser monitors the Funds liquidity position on a daily basis and the Board of Directors of the Manager reviews it on a quarterly basis. Invesco ASEAN Equity Fund As at 30 November 2013 Less than 1 month 1 month - 1 year 1-5 years 5 years+ Total $ $ $ $ $ Assets Cash and bank balances 3,915,737 3,915,737 Financial assets and liabilities at fair value through profit or loss 187,178, ,178,575 Other accrued income and prepaid expenses 114, ,397 Total assets 191,208, ,208,709 Liabilities Amounts due on liquidations 888, ,735 Distribution payable 1,585,556 1,585,556 Accrued expenses 415, ,162 Total liabilities 2,889,453 2,889,453 Net Assets Attributable to Holders of Redeemable Participating Shares (bid prices) 188,319, ,319,256 Invesco ASEAN Equity Fund As at 30 November 2012 Less than 1 month 1 month - 1 year 1-5 years 5 years+ Total $ $ $ $ $ Assets Cash and bank balances 5,281,021 5,281,021 Balances due from brokers 1,702,295 1,702,295 Amounts due on creations 12,528 12,528 Financial assets and liabilities at fair value through profit or loss 267,496, ,496,043 Other accrued income and prepaid expenses 252, ,207 Total assets 274,744, ,744,094 Liabilities Bank overdraft 437, ,255 Balances due to brokers 2,602,623 2,602,623 Amounts due on liquidations 482, ,171 Distribution payable 2,128,459 2,128,459 Accrued expenses 1,474,543 1,474,543 Total liabilities 7,125,051 7,125,051 Net Assets Attributable to Holders of Redeemable Participating Shares (bid prices) 267,619, ,619, Invesco Funds Series 1

33 Notes to the Financial Statements (continued) For the year ended 30 November Financial Investments and Associated Risks (continued) Liquidity risk (continued) Invesco Japanese Equity Fund As at 30 November 2013 Less than 1 month 1 month - 1 year 1-5 years 5 years+ Total $ $ $ $ $ Assets Cash and bank balances 380, ,603 Balances due from brokers 143, ,597 Amounts due on creations 4,093,244 4,093,244 Financial assets and liabilities at fair value through profit or loss 58,722,937 58,722,937 Other accrued income and prepaid expenses 310, ,828 Total assets 63,651,209 63,651,209 Liabilities Balances due to brokers 3,216,151 3,216,151 Amounts due on liquidations 2,529 2,529 Distribution payable 7,216 7,216 Accrued expenses 196, ,457 Total liabilities 3,422,353 3,422,353 Net Assets Attributable to Holders of Redeemable Participating Shares (bid prices) 60,228,856 60,228,856 Invesco Japanese Equity Fund As at 30 November 2012 Less than 1 month 1 month - 1 year 1-5 years 5 years+ Total $ $ $ $ $ Assets Cash and bank balances 109, ,329 Amounts due on creations 280, ,637 Financial assets and liabilities at fair value through profit or loss 46,189,666 46,189,666 Other accrued income and prepaid expenses 402, ,006 Total assets 46,981,638 46,981,638 Liabilities Amounts due on liquidations 14,817 14,817 Distribution payable 6,510 6,510 Accrued expenses 95,525 95,525 Total liabilities 116, ,852 Net Assets Attributable to Holders of Redeemable Participating Shares (bid prices) 46,864,786 46,864,786 Invesco Pacific Equity Fund As at 30 November 2013 Less than 1 month 1 month - 1 year 1-5 years 5 years+ Total $ $ $ $ $ Assets Cash and bank balances 5,677,182 5,677,182 Amounts due on creations 828, ,625 Financial assets and liabilities at fair value through profit or loss 155,481, ,481,907 Other accrued income and prepaid expenses 349, ,853 Total assets 162,337, ,337,567 Liabilities Balances due to brokers 850, ,283 Amounts due on liquidations 190, ,951 Distribution payable 349, ,190 Accrued expenses 316, ,017 Total liabilities 1,706,441 1,706,441 Net Assets Attributable to Holders of Redeemable Participating Shares (bid prices) 160,631, ,631, Invesco Funds Series 1

34 Notes to the Financial Statements (continued) For the year ended 30 November Financial Investments and Associated Risks (continued) Liquidity risk (continued) Invesco Pacific Equity Fund As at 30 November 2012 Less than 1 month 1 month - 1 year 1-5 years 5 years+ Total $ $ $ $ $ Assets Cash and bank balances 382, ,342 Balances due from brokers 6,337 6,337 Amounts due on creations 112, ,777 Financial assets and liabilities at fair value through profit or loss 104,696, ,696,147 Other accrued income and prepaid expenses 348, ,153 Total assets 105,545, ,545,756 Liabilities Amounts due on liquidations 159, ,283 Distribution payable 617, ,016 Accrued expenses 116, ,448 Total liabilities 892, ,747 Net Assets Attributable to Holders of Redeemable Participating Shares (bid prices) 104,653, ,653,009 All Financial Liabilities including redeemable preference shares fall within one month maturity. The Funds may be overdrawn up to 10% of the Net Asset Value (the NAV ) on a temporary basis to meet redemption requests. The Funds may also limit total redemption requests to 10% of the NAV in any one day. All redemptions are paid on the fourth business day after the redemption order is accepted. The majority of the Financial Assets held on the Funds are settled on a T +3 basis allowing sufficient time for the Investment Adviser to raise cash to meet redemption liabilities. In accordance with the Funds policy, the Investment Adviser monitors the Funds liquidity position on a daily basis and the Board of Directors of the Manager reviews it on a quarterly basis. Fair value estimation The fair value of financial assets and liabilities traded in active markets (such as publicly trading securities) are based on quoted market prices at 12.00pm (Irish Time) on 30 November 2013 for financial statement purposes. The quoted market price used for financial assets held by the Funds is the current bid price. The appropriate quoted market price for financial liabilities is the current asking price. A financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm s length basis. The Funds are exposed to daily cash redemptions of redeemable participating Shares. It therefore invests the majority of its assets in investments that are traded in an active market and can be readily disposed of; it invests only a limited proportion of its assets in investments not actively traded on a recognised market. For instruments for which there is no active market, the Funds may use internally developed models, which are usually based on valuation methods and techniques generally recognised as standard within the industry. Valuation models are used primarily to value unlisted equity instruments for which markets were or have been inactive during the financial year. Some of the inputs to these models may not be market observable and are therefore estimated based on assumptions. The output of a model is always an estimate or approximation of a value that cannot be determined with certainty, and valuation techniques employed may not fully reflect all factors relevant to the positions the Funds hold. Valuations are therefore adjusted, where appropriate, to allow for additional factors including model risk, liquidity risk and counterparty risk. The carrying value of other receivables and payables are assumed to approximate their fair values. The Funds classify fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels: - Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1). - Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2). - Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3). The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety is determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. For this purpose, the significance of an input is assessed against the fair value measurement in its entirety. If a fair value measurement uses observable inputs that require significant adjustment based on unobservable inputs, that measurement is a level 3 measurement. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgement, considering factors specific to the asset or liability. 32 Invesco Funds Series 1

35 Notes to the Financial Statements (continued) For the year ended 30 November Financial Investments and Associated Risks (continued) Fair value estimation (continued) The determination of what constitutes observable requires significant judgement by the Funds. The Funds consider observable data to be that market data that is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The following table analyses within the fair value hierarchy the Funds financial assets and liabilities (by class) measured at fair value at 30 November The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments. The Fund is exposed to daily cash redemptions of redeemable shares. It therefore invests the majority of its assets in investments that are traded in an active market and can be readily disposed of; it invests only a limited proportion of its assets in investments not actively traded on a recognised market. The following tables analyse within the fair value hierarchy the Funds financial assets and liabilities measured at fair value at 30 November 2013: 30 November 2013 Invesco ASEAN Equity Fund Level 1 Level 2 Level 3 Total Financial assets designated at fair value through profit or loss at inception: $ $ $ $ Equity Securities 187,178, ,178,575 Derivatives Total Investments 187,178, ,178,575 Invesco Japanese Equity Fund Level 1 Level 2 Level 3 Total Financial assets designated at fair value through profit or loss at inception: $ $ $ $ Equity Securities 58,722,937 58,722,937 Derivatives Total Investments 58,722,937 58,722,937 Invesco Pacific Equity Fund Level 1 Level 2 Level 3 Total Financial assets designated at fair value through profit or loss at inception: $ $ $ $ Equity Securities 155,481, ,481,907 Derivatives Total Investments 155,481, ,481, November 2012 Invesco ASEAN Equity Fund Level 1 Level 2 Level 3 Total Financial assets designated at fair value through profit or loss at inception: $ $ $ $ Equity Securities 267,496, ,496,043 Derivatives Total Investments 267,496, ,496,043 Invesco Japanese Equity Fund Level 1 Level 2 Level 3 Total Financial assets designated at fair value through profit or loss at inception: $ $ $ $ Equity Securities 46,189,666 46,189,666 Derivatives Total Investments 46,189,666 46,189,666 Invesco Pacific Equity Fund Level 1 Level 2 Level 3 Total Financial assets designated at fair value through profit or loss at inception: $ $ $ $ Equity Securities 104,696, ,696,147 Derivatives Total Investments 104,696, ,696,147 Investments whose values are based on quoted market prices in active markets, and therefore classified within level 1, include active listed equities and exchange traded derivatives. The Funds do not adjust the quoted price for these instruments. 33 Invesco Funds Series 1

36 Notes to the Financial Statements (continued) For the year ended 30 November Financial Investments and Associated Risks (continued) Fair value estimation (continued) Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within level 2. These include, investment-grade corporate bonds listed and over-the-counter derivatives. As level 2 investments include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information. Investments classified within level 3 have significant unobservable inputs, as they trade infrequently. Level 3 instruments include corporate debt securities. As observable prices are not available for these securities, the Funds have used valuation techniques to derive the fair value. The Funds also consider original transaction price, recent transactions in the same or similar instruments and completed third-party transactions in comparable instruments. The Funds also considers other liquidity, credit and market risk factors. The Funds adjust the model as deemed necessary. Credit Risk The Funds minimise concentrations of credit risk by undertaking transactions with a large number of customers and counterparties on recognised and reputable exchanges. All transactions in listed securities are settled/paid for upon delivery using approved brokers. The risk of default is considered minimal, as delivery of securities sold is only made once the broker has received payments. Payment is made on a purchase once the securities have been received by the broker. The trade will fail if either party fails to meet its obligations. The Investment Adviser continuously monitors the Funds credit position. Custodian Risk The Funds custodian is BNY Mellon Trust Company (Ireland) Limited. Substantially all the cash, equity and investments in debt securities of the Funds are held by BNY Mellon Trust Company (Ireland) Limited at the year end. The Funds are exposed to credit risk through the use of the Bank for their cash and investments. Bankruptcy or insolvency of the Bank may cause the Funds rights with respect to its cash held by the Bank to be delayed or limited. The maximum exposure to the risk at 30 November 2013 and 30 November 2012 is the amount of cash disclosed in note 6 and the investments in securities, and liquidity instruments disclosed in relevant Funds Schedule of Investments. To mitigate the risks the Funds are exposed to from the use of the custodian, the Investment Adviser employ s appropriate procedures to ensure that the counterparties are reputable institutions and that the credit risk is acceptable to the Funds. The Funds only transact with custodians that are regulated entities subject to prudential supervision, or with high credit-ratings assigned by international credit-rating agencies. In addition, the Funds non cash assets are segregated and protected and this further reduces counterparty risk. Cash held by the Custodian is not protected from insolvency or bankruptcy and this further increases counterparty risk. 5. Taxation Under current law and practice the Fund qualifies as an investment undertaking as defined in Section 739B of the Taxes Consolidation Act, 1997, as amended. On that basis, it is not chargeable to Irish tax on its income or gains. However, Irish tax may arise on the happening of a chargeable event. A chargeable event includes any distribution payments to shareholders, any encashment, redemption, cancellation or transfer of shares and the holding of shares at the end of each eight year beginning with the acquisition of such shares. No Irish tax will arise on the Fund in respect of chargeable events in respect of: A Shareholder who is neither Irish resident nor ordinarily resident in Ireland for tax purposes, at the time of the chargeable event, provided appropriate valid declarations in accordance with the provisions of the Taxes Consolidation Act, 1997, as amended, are held by the Fund or Fund has been authorised by the Irish Revenue to make gross payments in the absence of appropriate declarations; and Certain exempted Irish tax resident shareholders who have provided the Fund with the necessary signed statutory declarations. Dividends, interest and capital gains (if any) received on investments made by the Fund may be subject to withholding taxes imposed by the country from which the investment income/gains are received and such taxes may not be recoverable by the Fund or its shareholders. The Finance Act 2010 provides that the Revenue Commissioners may grant approval for investment funds marketed outside of Ireland to make payments to non-resident investors without deduction of Irish tax where no relevant declaration is in place, subject to meeting the equivalent measures. A fund wishing to receive approval must apply in writing to the Revenue Commissioners, confirming compliance with the relevant conditions. 34 Invesco Funds Series 1

37 Notes to the Financial Statements (continued) For the year ended 30 November Cash and Cash Equivalents 30 November 2013 Cash balances on deposit and bank overdrafts are listed below at the balance sheet date: Credit Ratings Invesco ASEAN Invesco Japanese Invesco Pacific S&P Moody s Equity Fund Equity Fund Equity Fund $ $ $ The Bank of New York Mellon A-1 P1 3,915, ,603 1,177,138 ING Bank A-1 P1 4,500,044 3,915, ,603 5,677, November 2012 Cash balances on deposit and bank overdrafts are listed below at the balance sheet date: Credit Ratings Invesco ASEAN Invesco Japanese Invesco Pacific S&P Moody s Equity Fund Equity Fund Equity Fund $ $ $ The Bank of New York Mellon A-1 P1 43, , ,342 ING Bank A-1 P1 4,800,000 4,843, , ,342 $437,255 in the Invesco Pacific Equity Fund was included as a bank overdraft as at 30 November Shares in Issue Invesco Invesco Invesco ASEAN Equity Japanese Pacific Equity Fund Equity Fund Fund $ $ $ 30 November 2013 A Shares 1,328,054 3,195,574 1,868,007 Net Asset Value per A Shares A-Acc HKD Shares 4,238 Net Asset Value per A-Acc HKD Shares (as expressed in HKD) B Shares 9,941 3, Net Asset Value per B Shares C Shares 540, ,998 1,298,732 Net Asset Value per C Shares I Shares 21 Net Asset Value per I Shares (as expressed in EUR) Z Shares ,361 Net Asset Value per Z Shares Invesco Invesco Invesco ASEAN Equity Japanese Pacific Equity Fund Equity Fund Fund $ $ $ 30 November 2012 A Shares 1,913,108 3,201,287 1,761,494 Net Asset Value per A Shares A-Acc HKD Shares 490 Net Asset Value per A-Acc HKD Shares (as expressed in HKD) B Shares 18,334 3, Net Asset Value per B Shares C Shares 669,728 99, ,164 Net Asset Value per C Shares I Shares 21 Net Asset Value per I Shares (as expressed in EUR) Invesco Funds Series 1

38 Notes to the Financial Statements (continued) For the year ended 30 November Stock Lending The stock lending agreement is with State Street Bank Europe Limited. The income earned in the current year is $Nil (2012: $Nil) for Invesco ASEAN Equity Fund, $10,912 (2012: $20,872) for Invesco Japanese Equity Fund and $Nil (2012: $Nil) for Invesco Pacific Equity Fund. Non-cash collateral received was in the form of German, French, Belgian and Dutch government bonds. The Fund also received US Treasury bonds. The income earned from stocklending is received by the fund net of a 15% fee, which is retained by State Street Bank for providing the Service. As at 30 November 2013 and 30 November 2012 the aggregate value of securities on loan from the Funds and the value of collateral held by the Funds in respect of these securities is detailed below. Invesco Invesco Invesco ASEAN Equity Japanese Pacific Equity Fund Equity Fund Fund 2013 Fair Value Shares on 30 November ,753 Collateral in respect of these securities Non-Cash 671,193 Cash 2012 Fair Value Shares on 30 November ,871,995 Collateral in respect of these securities Non Cash 1,342,615 Cash 1,703, Net Gains and Losses on Investments and Currency Realised and Realised and unrealised unrealised gains/(losses) gains/(losses) charged to charged to Fair Value profit and loss Fair Value profit and loss 2013 $ 2013 $ 2012 $ 2012 $ Invesco ASEAN Equity Fund Equities 187,178,575 (975,032) 267,496,043 42,149,455 Forward contracts 20,696 (41,387) Currency (810,713) (144,064) Transaction costs (14,224) (23,063) Other items 187,178,575 (1,779,273) 267,496,043 41,940,941 Invesco Japanese Equity Fund Equities 58,722,937 13,995,278 46,189,666 (515,720) Forward contracts (14,347) 15,432 Currency (94,089) (19,853) Transaction costs (18,392) (18,530) Other items 58,722,937 13,868,450 46,189,666 (538,671) Invesco Pacific Equity Fund Equities 155,481,907 35,312, ,696,147 8,061,637 Forward contracts (81,750) (20,663) Currency 79,242 24,836 Transaction costs (12,437) (14,597) Other items 155,481,907 35,297, ,696,147 8,051, Invesco Funds Series 1

39 Notes to the Financial Statements (continued) For the year ended 30 November Distribution to A, B, C and Z Shareholders Invesco ASEAN Invesco Japanese Invesco Pacific Equity Fund Equity Fund Equity Fund $ $ $ Distribution per Share (paid 21 January 2014) Type of Share A B C Z Distribution per Share (paid 21 January 2013) Type of Share A B C Efficient Portfolio Management Forward foreign currency exchange contracts may be used to hedge against anticipated future changes in exchange rates which otherwise might either adversely affect the value of the Funds portfolio securities or adversely affect the price of securities which the Fund intends to purchase at a later date. The Funds may also engage in forward currency transactions and utilise futures and options for efficient portfolio management or hedging purposes under the conditions and within the limits laid down by the Central Bank and, if more restrictive, the SFC. There were no forward foreign exchange contracts held as at 30 November 2013 and 30 November However, there were forward currency exchange contracts held during both years and sold before the year ends of 30 November 2013 and 30 November Please see Note 8 for Stock Lending details. 12. Transaction Fees Transaction fees incurred by the Fund relating to purchase or sale of transferable securities, derivatives or other eligible assets are mainly composed of custodian fees and broker commissions. Transaction fees are included in the transaction price used to calculate the realised and unrealised gain/(loss) on securities. Custody transaction costs are disclosed on Note 9. For the year ended 30 November 2013, custody transaction costs associated with Invesco ASEAN Equity Fund were $14,224 (2012: $23,063), Invesco Japanese Equity Fund were $18,392 (2012: $18,530) and Invesco Pacific Equity Fund were $12,437 (2012: $14,597). For the year ended 30 November 2013, other transactions costs amount to: Fund Ccy Transaction Fees Invesco ASEAN Equity Fund USD 321,757 Invesco Japanese Equity Fund USD 43,148 Invesco Pacific Equity Fund USD 181, Significant Events during the Year PWC were appointed auditors of the Management Company, Invesco Global Asset Management Limited, effective 1 January M. Boulanger was appointed to the Board of Directors of the Manager, Invesco Global Asset Management Limited, effective 10 January B. Fulton resigned from the Board of Directors of the Manager, Invesco Global Asset Management Limited, on 30 April D. Sharp was appointed to the Board of Directors of the Manager, Invesco Global Asset Management Limited, effective 1 May J. Rowland and K. Dunn Kelley resigned from the Board of Directors of the Manager, Invesco Global Asset Management Limited on 7 June, On 20 May, 2013 International Financial Data Services (Ireland) Limited was appointed as the new Registrar and Transfer Agent of the Series in place of Invesco Global Asset Management Limited. 37 Invesco Funds Series 1

40 Notes to the Financial Statements (continued) For the year ended 30 November Significant Events during the Year (continued) Additional share classes were launched on 21 August 2013 as follows: - Invesco ASEAN Equity Fund Z AD (USD) - Invesco Pacific Equity Fund Z AD (USD) A new Consolidated Prospectus for Invesco Funds Series 1, 2, 3, 4, 5, 6 and Fund Series was issued on 20 May 2013 and 20 August Subsequent Events There were no subsequent events after the year ended 30 November Approval of Financial Statements The financial statements were approved by the Directors of the Manager on 20 March Invesco Funds Series 1

41 Statement of the Manager s and Trustee s Responsibilities The Manager is required under the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011 (the UCITS Regulations ), to prepare Financial Statements for each financial period reporting the financial position of each Fund in the Invesco Funds Series 1 ( the Series ) as at the end of the accounting period and of its income/excess of expenditure over income for the period. In preparing those financial statements, the Manager: - ensures that the Financial Statements comply with the Trust Deed, Accounting Standards generally accepted in Ireland and applicable accounting standards subject to any material departures which are disclosed and explained in the financial statements; - selects suitable accounting policies and then applies them consistently; - makes judgements and estimates that are reasonable and prudent; - prepares the Financial Statements on the going concern basis unless it is inappropriate to presume that the Series will continue in operation; and - is responsible for taking reasonable steps for the prevention and detection of fraud, error, or non-compliance with laws or the UCITS Regulations, and other irregularities. The Manager is required to keep proper accounting records and to manage the Series in accordance with the UCITS Regulations, the Hong Kong Code on Unit Trusts, Mutual Funds and the Trust Deed. The Directors of the Manager and the Board of the Directors of the Manager of the Series are responsible for the maintenance and integrity of the information related to the Series through the Invesco website. Information on the internet is accessible in many countries with different legal requirements. Legislation in Ireland governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. The Trustee is required under the UCITS Regulations to:- 1. ensure that the sale, issue, repurchase, redemption and cancellation of Shares effected by or on behalf of the Funds are carried out in accordance with the UCITS Regulations and in accordance with the Trust Deed. 2. ensure that the value of Shares is calculated in accordance with the Regulations and the Trust Deed. 3. carry out the instructions of the Manager unless they conflict with the UCITS Regulations or the Trust Deed. 4. ensure that in transactions involving the Funds assets, any consideration is remitted to it within time limits which are acceptable market practice in the context of a particular transaction. 5. ensure that the Funds income is applied in accordance with the UCITS Regulations and the Trust Deed. 6. enquire into the conduct of the Manager in each annual accounting period and report thereon to the Shareholders. The Trustee s report shall be delivered to the Manager in good time to enable the Manager to include a copy of the report in its Annual Report. The Trustee s Report shall state whether in the Trustee s opinion the Funds have been managed in that period: (i) in accordance with the limitations imposed on the investment and borrowing powers of the Manager and Trustee by the Trust Deed and the UCITS Regulations; and (ii) otherwise in accordance with the provisions of the Trust Deed and the UCITS Regulations. If the Manager does not comply with (i) or (ii) above, the Trustee must state why this is the case and outline the steps which the Trustee has taken to rectify the situation. The Trustee must notify the Central Bank of Ireland promptly of any material breach of the UCITS Regulations, conditions imposed by the Central Bank of Ireland or provisions of the prospectus with regard to the Fund. The duties provided for above may not be delegated by the Trustee to a third party. These duties must be carried out in the State. The Trustee also takes into its custody or under its control all the assets of the Funds and holds them in safekeeping for the Shareholders. 39 Invesco Funds Series 1

42 Report of the Independent Auditors to the Shareholders of Invesco Funds Series 1 We have audited the financial statements of the Funds of Invesco Funds Series 1 for the year ended 30 November 2013 which comprise the Balance Sheet, the Income Statement, the Statement of Changes in Net Assets Attributable to Holders of Redeemable Participating Shareholders, the Portfolio Statements and the related notes for each of the Funds of the trust. The financial reporting framework that has been applied in their preparation is Irish law and accounting standards issued by the Financial Reporting Council and promulgated by the Institute of Chartered Accountants in Ireland (Generally Accepted Accounting Practice in Ireland). Respective responsibilities of the manager and auditors As explained more fully in the Statement of Manager s and Trustee s Responsibilities set out on page 41, the Manager is responsible for the preparation of the financial statements giving a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with Irish law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board s Ethical Standards for Auditors. This report, including the opinions, has been prepared for and only for the shareholders of each of the Funds and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing. Scope of the audit of the financial statements An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the Funds circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the manager; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the annual report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report. Opinion on financial statements In our opinion the financial statements: give a true and fair view in accordance with Generally Accepted Accounting Practice in Ireland of the state of the Funds affairs as at 30 November 2013 and of their results for the year then ended; and have been properly prepared in accordance with the requirements of the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011 (as amended). Report on Other Legal and Regulatory Requirements We report that the financial statements of the Funds have been properly prepared in accordance with the requirements of the Hong Kong Code on Unit Trusts and Mutual Funds and the Trust Deed of the Series. Opinion on other matters We have obtained all the information and explanations which we consider necessary for the purposes of our audit. The financial statements of the funds are in agreement with the books of account. PricewaterhouseCoopers Chartered Accountants and Registered Auditors One Spencer Dock North Wall Quay Dublin 1 Ireland 20 March 2014 The financial statements are published through The Directors of the Manager together with the Investment Adviser are responsible for the maintenance and integrity of the website as far as it relates to Invesco Funds Series 1. The work carried out by the auditors does not involve consideration of the maintenance and integrity of the website and accordingly, the auditors accept no responsibility for any changes that have occurred to the financial statements presented on the website. Legislation in the Republic of Ireland governing the presentation and dissemination of the financial statements may differ from legislation in other jurisdictions. 40 Invesco Funds Series 1

43 Report of the Trustee to the Shareholders We have enquired into the conduct of the Manager in respect of the Invesco Funds Series 1 ( the Series ) for the year ended 30 November 2013 in our capacity as Trustee to the Series. This report including the opinion has been prepared for and solely for the Shareholders in the Series, in accordance with the Central Bank of Ireland s UCITS Notice 4 and for no other purpose. We do not, in giving this opinion, accept or assume responsibility for any other purpose or to any other person to whom this report is shown. Responsibilities of the Trustee Our duties and responsibilities are outlined in the Central Bank of Ireland s UCITS Notice 4. One of those duties is to enquire into the conduct of the Series in each annual accounting period and report thereon to the Shareholders. Our report shall state whether, in our opinion, the Series has been managed in that period, in accordance with the provisions of the Series Trust Deed and the European Communities (Undertaking for Collective Investment in Transferable Securities) Regulations 2011(as amended) (the UCITS Regulations ). It is the overall responsibility of the Manager to comply with these provisions. If the Manager has not so complied, we as Trustee must state why this is the case and outline the steps which we have taken to rectify the situation. Basis of Trustee Opinion The Trustee conducts such reviews as it, in its reasonable opinion, considers necessary in order to comply with its duties as outlined in UCITS Notice 4 and to ensure that, in all material respects, the Series has been managed (i) in accordance with the limitations imposed on its investment and borrowing powers by the provisions of its constitutional documentation and appropriate regulations and (ii) otherwise in accordance with the Series constitutional documentation and appropriate regulations. Opinion In our opinion, the Series has been managed during the year, in all material respects: (i) in accordance with the limitations imposed on the investment and borrowing powers of the Manager and the Trustee by the Trust Deed and by the Regulations; and (ii) otherwise in accordance with the provisions of the Trust Deed and the Regulations. BNY Mellon Trust Company (Ireland) Limited Guild House, Guild Street IFSC, Dublin 1, Ireland. Date: 20 March Invesco Funds Series 1

44 Invesco Global Asset Management Limited Directors C. Majer - (German) B. Collins - (Irish) (Independent Director) J. Rowland - (British, resigned 7 June 2013) L. Schmidt - (American) O. Carroll - (Irish) C. OSullivan - (Irish) K. Dunn Kelley - (American, resigned 7 June 2013) B.T. Fulton - (American, resigned 30 April 2013) M Boulanger (French, appointed 10 January 2013) D. Sharp (Canadian, appointed 1 May 2013) Global Distributor, Registrar, Manager and Administrator Invesco Global Asset Management Limited Registered Office George s Quay House 43 Townsend Street Dublin 2 Ireland Correspondence address for Global Distributor Invesco Global Asset Management Limited 78 Sir John Rogersons Quay Dublin 2 Ireland Registrar and Transfer Agent* International Financial Data Services (Ireland) Limited 78 Sir John Rogersons Quay Dublin 2 Ireland Sub-Administrator BNY Mellon Fund Services (Ireland) Limited Guild House Guild Street International Financial Services Centre Dublin 1 Ireland Secretary Invesco Asset Management Limited (Registered office until 31 January 2014) 30 Finsbury Square EC2A 1AG London United Kingdom (Registered office from 1 February 2014) Perpetual Park Perpetual Park Drive Henley-on-Thames Oxfordshire RG9 1HH United Kingdom Trustee BNY Mellon Trust Company (Ireland) Limited Guild House Guild Street International Financial Services Centre Dublin 1 Ireland Hong Kong Sub-Distributor and Representative Invesco Asset Management Asia Limited. 41/F Citibank Tower 3 Garden Road, Central Hong Kong German Information Agent Invesco Asset Management Deutschland GmbH Registered Office An der Welle 5 D Frankfurt am Main Germany Legal Advisor Matheson 70 Sir John Rogerson s Quay Dublin 2 Ireland United Kingdom Representative Invesco Global Investment Funds Limited (Registered office until 31 January 2014) 30 Finsbury Square EC2A 1AG London United Kingdom (Registered office from 1 February 2014) Perpetual Park Perpetual Park Drive Henley-on-Thames Oxfordshire RG9 1HH United Kingdom Independent Auditors of the Fund and Management Company Auditors ** PricewaterhouseCoopers Chartered Accountants One Spencer Dock, North Wall Quay Dublin 1 Ireland Investment Advisers Invesco Hong Kong Limited 41F/Citibank Tower 3 Garden Road, Central Hong Kong Invesco Asset Management Limited (Registered office until 31 January 2014) 30 Finsbury Square EC2A 1AG London United Kingdom (Registered office from 1 February 2014) Perpetual Park Perpetual Park Drive Henley-on-Thames Oxfordshire RG9 1HH United Kingdom Invesco Asset Management (Japan) Limited Roppongi Hills Mori Tower 14F P.O. Box Roppongi, Minato-ku Tokyo Japan Austrian Distributor Invesco Asset Management Osterreich Gmbh Rotenturmstraße A-1010 Vienna Austria 42 Invesco Funds Series 1

45 Invesco Global Asset Management Limited (continued) Austrian Paying Agent Erste Bank der oesterreichischen Sparkassen AG Graben Vienna Austria German Paying Agent BNP Paribas Securitas SA Europa-Allee Frankfurt Germany * Effective 20 May 2013 (See Note 13 also) ** PricewaterhouseCoopers were appointed Auditors of the Management Company, effective 1 January (See Note 13 also) The latest Financial Statements are also available through Invesco s Internet Site For Shareholders in Hong Kong please refer to 43 Invesco Funds Series 1

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47 Contact us Invesco Global Asset Management Limited Manager George s Quay House 43 Townsend Street, Dublin 2, Ireland Telephone: Website: Invesco Asset Management Asia Limited Hong Kong Sub-Distributor and Representative 41F/Citibank Tower 3 Garden Road, Central Hong Kong Telephone: Facsimile: Website: