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FNBINF - Abridged Audited Results for the Year Ended 30 June 2023
FNB GOVERNMENT INFLATION LINKED BOND EXCHANGE TRADED
FUND
A portfolio in the FNB Funds Collective Investment Scheme in Securities Exchange Traded Funds registered in
terms of the Collective Investment Schemes Control Act, 45 of 2002
(Incorporated in the Republic of South Africa)
Share Code: FNBINF
ISIN: ZAE000303103
ABRIDGED AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2023
The FNB Funds Collective Investment Scheme in Securities Exchange Traded Funds (the "Scheme") was
established in accordance with the provisions of the Collective Investment Schemes Control Act 45 of 2002
("CISCA") with effect from 12 April 2008. The FNB Government Inflation Bond Exchange Traded Fund (the
"Portfolio") was established as a portfolio of the Scheme in accordance with paragraph A of the deed of the Scheme
on 5 March 2009.
The Portfolio is a passive investment fund with the aim of providing returns linked to the performance of the
Government Inflation Linked Bond Index (the "index") in terms of both price performance, as well as income from
the component securities in the index. The Portfolio will aim to track the performance of the index.
The Portfolio was initially listed on the JSE Limited ("JSE") on 1 June 2009.
STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2023
Rand 2023 2022
ASSETS
Investments designated at fair value through profit or loss 395 028 586 420 437 752
Trade and other receivables - 7 952
Cash and cash equivalents 2 879 884 4 013 419
Total assets 397 908 470 424 459 123
LIABILITIES
Net assets attributable to participatory interest holders 397 609 511 424 206 657
Trade and other payables 298 959 252 466
Total equity and liabilities 397 908 470 424 459 123
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED
30 JUNE 2023
Rand 2023 2022
Interest income 128 149 67 068
Fair value gains / (loss) 3 756 179 41 471 223
Investment income/(loss) 3 884 328 41 538 291
Operating expenses (900 479) (1 321 061)
Profit/(loss) before tax 2 983 849 40 217 230
Taxation -
Profit/(loss) before amounts attributable to participatory interest holders 2 983 849 40 217 230
Decrease/(Increase) in net assets attributable to participatory interest holders (2 983 849) (40 217 230)
Total comprehensive income for the year - -
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2023
Rand 2023 2022
Cash flows from operating activities
Cash utilised by operations (855 102) (1 487 184)
Interest received 11 405 492 12 981 928
Sales of investments designated at fair value through profit or loss 89 414 175 19 404 953
Purchase of investments designated at fair value through profit or loss (71 526 173) (19 422 254)
Net cash inflow/(outflow) from operating activities 28 438 392 11 477 443
Cash flows from financing activities
Redemption of portfolio participatory interests (18 215 043) -
Distributions paid to participatory interest holders (11 365 952) (11 611 950)
Net cash outflow from financing activities (29 580 995) (11 611 950)
Net increase/(decrease) in cash and cash equivalents (1 142 603) (134 507)
Cash and cash equivalents at the beginning of the year 4 013 419 4 147 926
Cash and cash equivalents at the end of the year 2 870 816 4 013 419
SUMMARISED ACCOUNTING POLICIES FOR THE YEAR ENDED 30 JUNE 2023
Basis of presentation
The annual financial statements have been prepared in accordance with IFRS issued by the International
Accounting Standards Board (the "IASB"), including interpretations issued by the IFRS Interpretations Committee,
the Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council, the South
African Institute of Chartered Accountants ("SAICA") Financial Reporting Guides as issued by the Accounting
Practices Committee and the provisions of CISCA, the JSE Listings Requirements and the Companies Act.
Adoption of standards
There were no new or amended IFRS standards which became effective for the year ended 30 June 2023 that
impacted the Portfolio's reported earnings, financial position or reserves, or the accounting policies.
Financial instruments: Classification
The Portfolio has classified all its investments as financial assets or financial liabilities at amortised cost or at fair
value through profit or loss ("FVPL").
Financial assets at amortised cost include other receivables, dividends and interest receivable and cash and cash
equivalents.
Financial assets at FVPL
All financial assets not measured at amortised cost are subsequently measured at FVPL, except for investments
in equities and rights which are mandatorily held at FVPL.
Financial liabilities at amortised cost
Financial liabilities that are not held-for-trading or designated as at FVPL are measured at amortised cost. This
category includes fees payable and other payables.
Financial instruments: Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, and other short-term highly liquid
investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of
changes in value. All balances, except for physical cash which is held at call, included in cash and cash equivalents
have a maturity date of less than three months from the acquisition date and are measured at amortised cost.
Participatory interest
The Portfolio issues one class of participatory interest which is redeemable at the holder's option. Participatory
interests can be put back to the Portfolio at any dealing date for cash equal to a proportionate share of the
Portfolio's net asset value attributable to the participatory interest class.
The participatory interests are measured at the redemption amount that is payable at the reporting date if the
holder exercises the right to put the participatory interests back to the Portfolio.
The participatory interests are issued and redeemed at the holder's option at prices based on the Portfolio's net
asset value per participatory interest at the time of issue or redemption. The Portfolio's net asset value per
participatory interest is calculated by dividing the net assets attributable to the holders of the participatory interest
by the total number of outstanding participatory interests, in accordance with the provisions of the Portfolio's
supplemental trust deed.
Net assets attributable to participatory interest holders, evidence a residual interest in the assets of the Portfolio
after deducting all of its liabilities.
The value of the net assets attributable to participatory interest holders will vary with the changes in the
underlying value of the investments, net of receivables and payables. The total movement in the statement of
comprehensive income is transferred to the net assets attributable to participatory interest holders.
Creations and redemptions are recorded on trade date using the previous day's closing price.
In accordance with the Portfolio's supplemental trust deed, the Portfolio distributes its distributable income and any
other amounts determined by the Manager of the Portfolio to participatory interest holders. The portfolio does not
have an unconditional right to avoid delivering cash or another financial asset to settle the contractual obligation
should a holder exercise the right to put the participatory interests back to the portfolio. For this reason, the
participatory interest does not meet the requirements to be classified as equity in terms of IAS 32 and is thus
classified as a liability. Distributions are automatically reinvested in additional participatory interests, other than
distributions that are paid in cash.
Net income adjustment on creation and redemption of units
An adjustment to income arises on the creation and cancellation of units since the price of a unit includes
accrued income and expenses. The income adjustment on creation or cancellation of units is recognised as part
of the creation or redemption of unitholder interests and disclosed within the note of net assets attributable to
participatory interest holders, when units on which it arises are either purchased or sold as these form part of the
cash flow on unit transactions.
Investment income
Fair value gains and losses
Gains and losses arising from a change in the fair value of investments, interest income on interest-bearing
investments and dividend income, are included in the statement of comprehensive income under fair value gains
/ losses in the year in which the changes arise.
Interest income
Interest income on cash and cash equivalents is recognised in the statement of comprehensive income as part of
interest income on the effective interest method.
Taxation
The Portfolio has no current or deferred tax liability as all realised gains and losses are considered to be of a capital
nature and disregarded in the tax calculation of this Collective Investment Scheme portfolio in accordance with
paragraph 61 of the Eighth schedule to the Income Tax Act No 58 of 1962. All investment income is distributed
within the time frames specified by section 25BA of the Income Tax Act and is therefore taxed in the hands of the
participatory interest holders.
Critical accounting estimates and judgements in applying accounting policies
No significant accounting estimates and judgements have been applied in the annual financial statements of the
Portfolio.
All investments at FVPL are measured at fair value based on quoted prices in active markets and do not require
the use of judgement or estimates.
SUMMARISED NOTES TO THE ANNUAL FINANCIAL STATEMENTS FOR THE
YEAR ENDED 30 JUNE 2023
Net assets attributable to participatory interest holders
Rand 2023 2022
Balance at the beginning of the year 424 206 657 395 601 377
Participatory interests created during the year - -
Participatory interests redeemed during the year (18 215 043) -
Increase/(decrease) in net assets attributable to participatory interest holders 2 983 849 40 217 230
Distributions paid (11 365 952) (11 611 950)
Balance at the end of the year 397 609 511 424 206 657
Distributions
Number of Number of
participatory Distribution participatory Distribution
interests interests
Rand 2023 2023 2022 2022
Declared 27 July 2022 and paid 1 August 2022
(2022: No distributions declared)
Class A: 16.89 cents per participatory interest (2022: nil cents
per participatory interest) 17 734 948 2 996 279 18 534 948 -
Declared 26 October 2022 and paid 31 October 2022
(2022: Declared 20 October 2021 and paid 25 October
2021)
Class A: 15.88 cents per participatory interest (2022:
13.87 cents per participatory interest) 17 734 948 2 815 668 18 534 948 2 571 613
Declared 25 January 2023 and paid 30 January 2023
(2022: Declared 31 December 2021 and paid 3 January
2022)
Class A: 10.77 cents per participatory interest (2022:
16.44 cents per participatory interest) 17 734 948 1 910 868 18 534 948 3 046 319
Declared 25 April 2023 and paid 2 May 2023
(2022: Declared 31 March 2022 and paid 1 April 2022)
Class A: 20.54 cents per participatory interest (2022:
15.41 cents per participatory interest) 17 734 948 3 643 138 18 534 948 2 855 687
11 365 952 8 473 619
Included in the liability to participatory interest holders is the distribution payable as at 30 June 2023.
These summarised annual financial statements have not been audited by the independent auditors, but the full
sets, available at the website mentioned below, have been audited by the independent auditors,
PricewaterhouseCoopers Incorporated, and their unqualified audit opinion is available for inspection at the
company's registered office.
A full copy of the audited annual financial statements is available on the FNB website:
https://www.fnb.co.za/share-investing/exchange-traded-funds.html through the route "ETFs available to
you from FNB - Available ETFs – FNB Inflation ETF – ETF documents – Annual Financial Statements".
31 October 2023
Debt Sponsor
Rand Merchant Bank (a division of FirstRand Bank Limited)
Trustee
Standard Chartered Bank, Johannesburg Branch
Manager
FNB CIS Manco (RF) Proprietary Limited
Auditors
PricewaterhouseCoopers Incorporated
Date: 31-10-2023 05:30:00
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