anz investment funds annual report annual report 2015... · anz investment funds annual report for...

ANZ Investment Funds Annual Report

FOR THE YEAR ENDED 30 SEPTEMBER 2015

1

Dear investors 1

Performance summary and unit prices 3

Financial statements

Income Statement 4

Statement of Changes in Equity 4

Balance Sheet 6

Statement of Cash Flows 8

Notes to the financial statements 10

Independent auditor’s report 38

Directory 40

Contents

Dear investorsOn behalf of ANZ Investments, I’m pleased to present this annual report for the ANZ Investment Funds (the Funds), including the financial statements for the year ended 30 September 2015.

Despite increased volatility in investment markets over the last three months of the reporting period, I’m delighted to report solid investment performance for the Funds. Also pleasing has been the growth in the level of funds under management by $244 million to $515 million as at 30 September 2015.

You can see the performance of each fund on page 3, as well as unit price growth since the Funds’ launch in April 2010.

Swings and roundabouts

Looking back, the year was characterised by an uncertain and changing economic backdrop. There was ongoing volatility in sharemarkets as well as in currency and commodity markets.

The period began with the New Zealand economy receiving praise for its strong performance. As a result, the Reserve Bank of New Zealand (RBNZ) continued to hold the official cash rate (OCR) at 3.50% – the highest it’s been in over five years.

Global commodity prices fell over the latter half of 2014 – led by oil, which dropped almost 40% from October to mid-January.

However, by June 2015 and the apparent resolution of Greece’s ongoing issues, it became clear the real story was the slowing Chinese economy. Fears of a steeper-than-expected slowdown in China sparked global market turbulence, while China’s decision to allow its currency to devalue against the US dollar caused further uncertainty.

Closer to home, New Zealand saw its key whole milk powder auction prices fall by over 50% between February and August as global economic weakness squeezed world trade. On the back of this and other weak economic data, the RBNZ finally lowered the OCR – in three consecutive drops of 0.25%. (Lower interest rates generally support growth in the economy by encouraging investment).

This was good news for our key exporting sectors – and for New Zealand-based investors with unhedged international investments, as the New Zealand dollar fell.

But complicating matters was the chance of an increase in US interest rates amid the prospect of slower global growth and weakness in emerging markets. This added to volatility as investors tried to adjust their expectations while not knowing when the US rate move might occur.

Back to basics

As investment manager of the Funds, ANZ Investments responded to this environment by continuing to focus on the investment basics of quality, liquidity and diversification. In other words, maintaining a well-mixed portfolio of sound investment assets that we can readily sell if and when we want to.

Despite increased volatility in investment markets over the last three months of the reporting period, I’m delighted to report solid investment performance for the Funds.

You’re always connectedKeep in touch with your investment by visiting anz.co.nz/investmentfunds to:

• track your fund’s performance, asset mix and unit price

• view and download key documents and forms.

If you bank with ANZ, you can also find up-to-date information about all your ANZ savings and investment products:

• through ANZ Internet Banking at anz.co.nz

• by using the ANZ goMoney app on your smartphone or tablet.

From time to time, we’d also like to send you news and information about your investment, so it’s important we have all your contact details and that you keep us up to date. Please get in touch if you need to make any changes. Our contact details are listed on page 40.

2 3

for the year ended 30 September 2015

Performance summary and unit prices

Investment performance for the year ended 30 September

20151

Annualised investment

performance since inception2

Unit price at 30 September

20151

Conservative Fund 6.82% 6.24% $1.3774

Conservative Balanced Fund 7.46% 7.26% $1.4472

Balanced Fund 7.96% 8.19% $1.5130

Balanced Growth Fund 8.58% 9.25% $1.5915

Growth Fund 8.81% 9.95% $1.6435

1 Past performance is not indicative of future performance. Performance can be negative as well as positive. Investments in any of the Funds referred to in this publication are subject to investment risk, including possible delays in repayment and loss of income and principal invested. Unless otherwise indicated, performance is after fees and before tax. This is represented by changes in unit price plus any applicable tax credits.2 The inception date for all Funds was 16 April 2010.

Unit prices since inception

Date

During the year in review, ANZ Investments won the following awards:

2014* FundSource Awards (November)

• Fund Manager of the Year

• KiwiSaver Manager of the Year

• Fund Manager of the Year – International Equity

• Fund Manager of the Year – New Zealand Property

Morningstar Awards 2015 (March)

• Fund Manager of the Year Winner, New Zealand

• KiwiSaver Category Winner, New Zealand

• International Equities Category Winner, New Zealand

* FundSource Awards November 2014.

Refer inside back cover for full awards disclaimers.

In this regard, our investment team is among the most experienced, skilled and stable in the region. Adding to their already strong track record, ANZ Investments won several new awards during the period, as highlighted below.

Also during the year, ANZ Investments was pleased to announce a reduction in the total Fund fee for the Funds. The Fund fee is the maximum fee that can be charged for each fund. The new Fund fees are set out in the latest investment statement for the Funds, which can be found on our website at anz.co.nz/investmentsfunds.

Mind the bumps

After an extended period of investment performance exceeding most analyst forecasts, it’s important to sound a word of caution about expectations going forward.

With interest rates at close to historic lows, and both the share and property markets appearing ‘fully priced’ (representing a fair market value), we think the recent strong gains from growth assets are unlikely to continue in the short term.

Finally, I would just remind all our investors that although volatility is part of investing, it doesn’t have to be cause for panic. Keeping a disciplined and patient approach to your investment – regardless of what’s happening in the markets – is one of the smartest things you can do.

Thank you for your support this year either as an existing or a new investor. We look forward to helping you grow your investment and moving you closer to your financial goals.

Ana-Marie Lockyer General Manager Wealth Products

30 Sep 2011 30 Sep 2012 30 Sep 2013 30 Sep 2014 30 Sep 2015

Uni

t pri

ces

($)

0.900.951.001.051.101.151.201.251.301.351.401.451.501.551.601.651.701.751.80

Conservative Fund

Conservative Balanced Fund

Balanced Fund

Balanced Growth Fund

Growth Fund

4 5


Income Statement

Statement of Changes in Equityfor the year ended 30 September 2015

Conservative Fund


Balanced Fund


Growth Fund

Note 2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Income

Interest income 7 8 – 22 1 29 1 27 1 12 –

Net changes in fair value of investment assets and liabilities 4 2,410 2,038 6,589 4,320 8,707 5,324 9,528 8,169 3,585 2,847

Net investment income 2,418 2,038 6,611 4,321 8,736 5,325 9,555 8,170 3,597 2,847

Expenses

Management fees 7 366 271 1,067 509 1,476 581 1,442 814 643 271

Trustee fees 14 10 38 19 50 20 47 27 20 9

Auditor’s fee – statutory financial statements 5 5 5 5 5 5 5 5 5 5

Auditor’s fee – prospectus, semi-annual controls and trustee reporting 1 1 1 1 1 1 1 1 1 1

Other operating expenses 31 28 78 54 99 60 52 81 46 21

Total expenses 417 315 1,189 588 1,631 667 1,547 928 715 307

Net profit attributable to unitholders 2,001 1,723 5,422 3,733 7,105 4,658 8,008 7,242 2,882 2,540

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000


Contributions from unitholders 22,260 4,134 66,347 24,922 94,104 35,921 58,721 21,730 36,541 14,677

Contributions for PIE tax received 1 – 14 – 24 – 30 – 24 –

Withdrawals by unitholders (4,899) (4,838) (13,396) (2,508) (15,414) (3,860) (15,430) (5,690) (7,366) (2,345)

Withdrawals for PIE tax paid (335) (97) (777) (219) (885) (315) (757) (550) (245) (197)

Unitholders’ funds at the beginning of the year 25,992 25,070 61,199 35,271 73,331 36,927 81,034 58,302 29,543 14,868

Unitholders’ funds at the end of the year 45,020 25,992 118,809 61,199 158,265 73,331 131,606 81,034 61,379 29,543

The notes to the financial statements form part of and should be read in conjunction with these financial statements.

6 7

as at 30 September 2015

Balance Sheet

Conservative Fund


Balanced Fund


Growth Fund

Note 2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Assets

Cash and cash equivalents 3 3 3 3 3 2 3 3 3 3

Investment assets 3 45,071 26,100 118,958 61,556 158,457 73,892 131,783 81,807 61,457 29,878

Other receivables 5 – – 1 – 8 – 5 – 5 –

Total assets 45,074 26,103 118,962 61,559 158,468 73,894 131,791 81,810 61,465 29,881

Liabilities

Investment liabilities 3 2 77 10 280 4 467 13 663 3 296

Other payables 52 34 143 80 199 96 172 113 83 42

Total liabilities 54 111 153 360 203 563 185 776 86 338

Net assets attributable to unitholders 45,020 25,992 118,809 61,199 158,265 73,331 131,606 81,034 61,379 29,543

On behalf of ANZ New Zealand Investments Limited as Manager who authorised the issue of these financial statements on 11 December 2015:

John Body Director

Penelope Ford Director


8 9


Statement of Cash Flows

Conservative Fund


Balanced Fund


Growth Fund

Note 2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Cash flows from operating activities

Interest received 8 – 22 1 29 1 27 1 12 –

Net (purchases)/sales of investment assets and liabilities (16,636) 1,095 (51,083) (21,636) (76,321) (31,164) (41,098) (14,587) (28,287) (11,849)

Management fees paid (350) (272) (1,015) (488) (1,394) (549) (1,390) (796) (609) (257)

Trustee fees paid (13) (9) (33) (17) (43) (17) (43) (25) (17) (8)

Other operating expenses paid (36) (34) (78) (51) (91) (57) (55) (80) (48) (22)

Net cash flows from operating activities 8 (17,027) 780 (52,187) (22,191) (77,820) (31,786) (42,559) (15,487) (28,949) (12,136)

Cash flows from financing activities

Proceeds from contributions by unitholders 22,260 4,160 66,347 24,923 94,104 35,961 58,721 21,739 36,541 14,679

Payments for withdrawals by unitholders (4,899) (4,843) (13,396) (2,513) (15,414) (3,861) (15,430) (5,702) (7,366) (2,346)

PIE tax paid on behalf of unitholders (334) (97) (764) (219) (869) (315) (732) (550) (226) (197)

Net cash flows from financing activities 17,027 (780) 52,187 22,191 77,821 31,785 42,559 15,487 28,949 12,136

Net increase/(decrease) in cash and cash equivalents – – – – 1 (1) – – – –

Opening cash and cash equivalents 3 3 3 3 2 3 3 3 3 3

Closing cash and cash equivalents 3 3 3 3 3 2 3 3 3 3


10 11

The trustee of the Funds is The New Zealand Guardian Trust Company Limited (the ‘Trustee’). The registered office of the Trustee is Level 14, 191 Queen Street, Auckland, New Zealand.

The Funds were established pursuant to the first master trust deed dated 14 January 2010. This master trust deed was replaced by the Amended and Restated Master Trust Deed (the ‘Master Trust Deed’) dated 8 April 2010.

In accordance with the Master Trust Deed, the Manager notifies unitholders of the following changes made to the Master Trust Deed since the last balance date.

The Master Trust Deed was amended on 8 January 2015. The amendments were to clauses 44.3 and 49.2 to allow the Manager to make the annual report for the Funds and summary of any Trust Deed amendments available to unitholders electronically.

The most recent prospectus was filed on the Companies Register under ANZ New Zealand Investments Limited on 17 December 2014 and extended on 26 June 2015.

A unitholder has the right to receive, on request, a copy of the most recent financial statements, auditor’s report or registered prospectus relating to the Funds. These can be obtained by contacting the Manager on 0800 736 034.

The most recent financial statements and other documents of, or relating to, the Funds are filed on a public register at the Companies Office of the Ministry of Business, Innovation and Employment and available for public inspection at companies.govt.nz under ‘Search other registers’.

Note 1 – Reporting entityThese financial statements are for The Unit Trusts which comprise the following funds (the ‘Funds’):

• The Unit Trusts – Conservative Fund

• The Unit Trusts – Conservative Balanced Fund

• The Unit Trusts – Balanced Fund

• The Unit Trusts – Balanced Growth Fund

• The Unit Trusts – Growth Fund

The Funds are collectively marketed as the ANZ Investment Funds and the OneAnswer Investment Funds – Multi Asset Class.

These financial statements exclude the ANZ Private Global Bond Fund and ANZ Private Global Equity Fund (ANZ Private Funds), which are presented in separate financial statements.

The Funds are investment funds domiciled and established under the laws of New Zealand. Each fund is a unit trust as defined by the Unit Trusts Act 1960 (the ‘Act’) and the Funds are subject to the provisions of the Act (please see Note 2(a) for further information).

The registered address of the Funds is Ground Floor, ANZ Centre, 23-29 Albert Street, Auckland 1010, New Zealand.

The investment and administration activities of the Funds are managed by ANZ New Zealand Investments Limited (‘ANZ Investments’), the manager (‘Manager’).

The registered address of the Manager is Ground Floor, ANZ Centre, 23-29 Albert Street, Auckland 1010, New Zealand. See the directory on page 40 for contact information.

Note 2 – Summary of significant accounting policiesThe following sets out the significant accounting policies applied in the preparation of these financial statements. References to the ‘Funds’ include funds that have a controlling interest in other funds.

(a) Statement of compliance

The financial statements have been prepared by the Manager in accordance with the Master Trust Deed, the Financial Reporting Act 1993, the Unit Trusts Act 1960 (each of which remains applicable to the Trust during the relevant transitional periods of the Financial Reporting Act 2013 and the Financial Markets Conduct Act 2013) and New Zealand Generally Accepted Accounting Practice (NZ GAAP). They comply with New Zealand equivalents to International Financial Reporting Standards (NZ IFRS), and other applicable Financial Reporting Standards, as appropriate for publicly accountable and profit-oriented entities. The financial statements also comply with International Financial Reporting Standards (IFRS).

The financial statements were authorised for issue by the directors of the Manager on 11 December 2015.

(b) Basis of preparation

The financial statements are presented in New Zealand dollars, which is the Funds’ functional currency. All values are rounded to the nearest thousand dollars ($000). Except where noted in specific accounting policies below, they are prepared on a fair value basis. Any owner changes in equity are presented in the Statement of Changes in Equity, whereas any non-owner changes

in equity are presented in the Income Statement. The Funds have no components of comprehensive income other than profit or loss for the year. Consequently, the profit or loss is the total comprehensive income of the Funds.

The financial statements for all Funds are prepared on a going concern basis and in accordance with the Accounting Standards Framework for publicly accountable and profit-oriented entities (Tier 1).

These separate financial statements are the only financial statements for the Funds.

The following standards and amendments have been issued and have been adopted by the Funds for the financial year ended 30 September 2015:

NZ IAS 32: Financial instruments: Presentation – Offsetting financial assets and liabilities (amendments) The amended standard provided additional application guidance and clarified the meaning of ‘currently has a legal enforceable right of set off’. These amendments did not have a significant impact on the Funds’ financial position or performance.

Detailed below are standards and amendments issued but not effective for the financial year ended 30 September 2015 and which have not been adopted early. The Manager does not expect any significant impact upon adopting the standards and amendments below and intends to adopt them no later than their effective dates.

NZ IFRS 9: Financial instruments The standard is effective for annual periods beginning on or after 1 January 2018 and specifies how an entity should classify and measure financial assets and liabilities

Notes to the financial statementsfor the year ended 30 September 2015

12 13

(c) Involvement with unconsolidated structured entities

The Manager has concluded that the Funds’ investments in unitised funds (‘investee funds’) which they don’t consolidate meet the definition of structured entities because:

(i) The voting rights in the investee funds are not dominant rights in deciding who controls them as they relate to administrative tasks only;

(ii) Each investee fund’s activities are restricted by its governing documents; and

(iii) The investee funds have narrow and well-defined objectives to provide investment opportunities to investors.

The Funds invest in investee funds whose objectives are to provide long-term capital growth and whose investment strategies do not include the use of leverage. The investee funds are managed by the Manager and apply various investment strategies to accomplish their respective investment objectives.

The investee funds finance their operations by issuing units to investors which entitle them to a proportional stake in the investee funds’ net assets. The Funds hold units in each of its investee funds.

The change in fair value of each investee fund is included in the Income Statement within ‘Net changes in fair value of investment assets and liabilities’.

Refer to Note 3 and Note 4 for more information.

(including some hybrid contracts) and the new general hedge accounting requirements. The adoption of this standard may result in additional or amended disclosures and its impact on the Funds’ reported result or financial position has not yet been assessed.

There are no other financial reporting standards that have been issued but not yet adopted in these financial statements, that are expected to have a material impact on the reported position or results of the Funds.

Estimates and judgementsThe preparation of financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected. In particular, the estimates and judgements in preparing these financial statements relate to the valuation of investment assets (refer to Notes 2(e) and 6(f )) and the judgement that the investments in unitised funds meet the definition of structured entities as described in note 2(c).

Except as noted above, the accounting policies have been consistently applied to all periods presented in these financial statements.

(d) Cash and cash equivalents

Cash and cash equivalents comprise current accounts and demand deposits. Cash equivalents are short-term highly liquid investments that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value, and are held for the purpose of meeting short-term cash commitments rather than investments or other purposes.

(e) Financial assets and liabilities – investments

RecognitionInvestment assets and liabilities are recognised on the date that the Funds become party to the contractual agreement (trade date). Investment assets are derecognised when the contractual rights to the cash flows expire or the Funds have transferred substantially all risks and rewards of ownership. Investment liabilities are derecognised when the Funds have discharged all contractual obligations.

MeasurementThe Fund’s investment assets and liabilities are managed on a fair value basis, and carried at their fair value, with changes recognised in the Income Statement. Derivative assets and liabilities are classified as ‘trading’, and all other investment assets and liabilities are designated as ‘fair value through profit or loss’ on initial recognition. The fair value of investments is based on their quoted market prices at balance date. Investment assets are priced at last traded prices, while investment liabilities are priced at current asking prices.

Investments in unitised funds are recorded at the redemption value per unit as reported by the managers of such funds, adjusted for any information received subsequent to balance date that provides evidence of conditions that existed at balance date.

The fair value of derivatives that are not exchange-traded is estimated at the amount that the Funds would receive or pay to terminate the contract at balance date taking into account current market conditions (volatility, appropriate yield curve) and the current creditworthiness of the counterparties. Specifically, the fair value of a forward contract is determined as the net present value of estimated future cash flows, discounted at appropriate market rates on the valuation date.

Investment assets and liabilities are required to be classified 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:

(i) quoted prices (unadjusted in active markets) for identical assets or liabilities (Level 1);

(ii) inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. prices) or indirectly (i.e. derived from prices)(Level 2); and

(iii) inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).

More information on the estimation of fair value is given in Note 6(f ).

Note 2 – Summary of significant accounting policies (continued)

14 15

(i) Revenue recognition

Interest income is recognised in the Income Statement as it accrues, using the original effective interest rate of the instrument calculated at the acquisition or origination date.

Income distributions from other unitised funds are recognised in the Income Statement as distribution income on an entitlement basis.

Net changes in the fair value of investment assets and liabilities are recognised immediately in the Income Statement.

Realised gains or losses on investments sold are calculated as the difference between sale proceeds and costs.

(j) Taxation

The Funds are Portfolio Investment Entities (‘PIEs’) for tax purposes.

Under the PIE regime, income is effectively taxed in the hands of the unitholders. The Manager attributes the taxable income of the Funds to unitholders in accordance with their proportionate interest in each fund. Income attributed to each unitholder is taxed at the unitholder’s Prescribed Investor Rate. The Manager accounts for tax on behalf of natural persons and certain unitholders by adjusting the unitholders’ interest in each fund.

PIE tax transactions are typically processed at the end of each tax year and upon full exit from a fund, by cancelling or issuing units equal to the value of the tax liability or refund.

(f) Other receivables and other payables

Other receivables and other payables include accrued income and expenses, and are carried at their amortised cost using the effective interest rate method. Their carrying value closely approximates their fair value.

(g) Offsetting financial assets and liabilities

Investment assets and liabilities are offset and the net amount reported in the Balance Sheet when and only 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.

For cash flow statement presentation purposes sales and purchases of investment assets and liabilities are high-volume operational items and have been netted in the Statement of Cash Flows.

(h) Foreign currency transactions

Investments and other monetary assets and liabilities denominated in foreign currencies are translated to New Zealand dollars at the exchange rate ruling at balance date. Transactions in foreign currencies are recorded at the exchange rate ruling on the dates of the transactions.

Foreign exchange gains and losses relating to the financial assets and liabilities carried at fair value through profit or loss and foreign exchange gains and losses arising from translation are presented in the Income Statement within ‘Net changes in fair value of investment assets and liabilities’.

The tax balances included in the Balance Sheet (as disclosed in the notes to the financial statements) represents PIE tax receivable or payable on behalf of unitholders.

(k) Unitholders’ funds

Units issued by the Funds provide the unitholders with the right to require redemption for cash at the value proportionate to the unitholders’ share in each fund’s net asset value. The units qualify as ‘puttable instruments’ and are classified as equity.

Note 2 – Summary of significant accounting policies (continued)

16 17

Note 3 – Investment assets and liabilities

The Funds held the following investments at balance date. Investments designated ‘ANZ’ are managed by ANZ New Zealand Investments Limited, the Manager. The table

below also sets out interests held by the Funds in unconsolidated structured entities as at balance date.

Conservative Fund


Balanced Fund


Growth Fund

Total investee fund net

assets

Number of investors

in the investee

funds

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2015

Investment assets

ANZ Wholesale Cash Fund 13,009 5,655 29,299 10,432 29,753 8,710 18,705 5,872 6,057 1,488 2,598,644 111

ANZ Wholesale Australian Share Fund 862 490 4,039 2,060 7,869 3,500 8,281 4,987 5,092 2,333 502,896 55

ANZ Wholesale Australasian Share Fund 991 661 4,576 2,749 8,917 4,757 9,340 6,456 5,597 2,930 655,461 72

ANZ Wholesale International Share Fund 4,962 4,257 23,022 15,290 45,563 25,111 51,506 35,970 29,459 15,846 3,151,437 86

ANZ Wholesale Sovereign Bond Fund 2,704 1,481 5,716 2,751 6,154 2,642 3,824 2,186 993 434 784,953 70

ANZ Wholesale High Grade Bond Fund 3,384 1,862 7,174 3,441 7,712 3,302 4,761 2,734 1,244 544 546,823 69

ANZ Wholesale New Zealand Yield Fund 676 371 1,431 688 1,521 660 924 546 248 108 83,029 38

ANZ Wholesale International Sovereign Fund 17,045 10,562 36,374 20,503 37,722 19,457 20,575 14,987 4,790 2,859 2,186,048 60

ANZ Wholesale International Property Securities Fund (ex Aus.) 688 374 3,565 1,823 6,397 2,884 6,671 4,034 3,877 1,651 497,151 59

ANZ Wholesale Trans-Tasman Property Securities Fund 676 387 3,419 1,819 6,183 2,869 6,446 4,035 3,674 1,685 354,932 41

Forward foreign exchange contracts 74 – 343 – 666 – 750 – 426 –

Total investment assets 45,071 26,100 118,958 61,556 158,457 73,892 131,783 81,807 61,457 29,878

Investment liabilities

Forward foreign exchange contracts 2 77 10 280 4 467 13 663 3 296

Total investment liabilities 2 77 10 280 4 467 13 663 3 296

18 19

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Net realised gains and losses 787 702 149 868 (1,727) 1079 290 2,337 (866) 531

Net unrealised gains and losses 1,623 1,336 6,440 3,452 10,434 4,245 9,238 5,832 4,451 2,316

Net changes in fair value of investment assets and liabilities 2,410 2,038 6,589 4,320 8,707 5,324 9,528 8,169 3,585 2,847

Net changes in fair value of investment assets and liabilities designated as fair value through profit or loss on initial recognition 2,807 2,025 8,546 4,433 12,388 5,544 13,770 8,291 5,967 2,966

Net changes in fair value of investment assets and liabilities held for trading (397) 13 (1,957) (113) (3,681) (220) (4,242) (122) (2,382) (119)

Net changes in fair value of investment assets and liabilities 2,410 2,038 6,589 4,320 8,707 5,324 9,528 8,169 3,585 2,847

Change in fair value of investment assets and liabilities relating to investments in unconsolidated structured entities 2,807 2,025 8,546 4,433 12,388 5,544 13,770 8,291 5,967 2,966

Note 4 – Net changes in fair value of investment assets and liabilities

Involvement with unconsolidated structured entities

The Funds’ investments in investee funds are subject to the terms and conditions of the respective investee funds’ governing documents and are susceptible to market price risk arising from uncertainties about future values of these investee funds. All of the investee funds in the investment portfolio are managed by investment managers (internal and external) who are compensated for their services. Such compensation generally consists of an asset based fee which is apportioned to be within the management fee of the Funds.

The Funds invest in investee funds (structured entities) whose purpose is to manage assets on behalf of the investors and generate fees for the investment manager. These vehicles are financed through the issue of units to investors. The Funds hold units in the investee funds.

The Funds can redeem units in the investee funds by notifying the Manager and the request will be processed generally within 10 business days of receiving the request.

The maximum exposure to loss is the carrying amount of the financial assets held. Once the Funds have sold all units

in an investee fund, the Funds cease to be exposed to any risk from that investee fund.

During the year, the Funds did not provide financial or other support to unconsolidated structured entities and have no intention of providing financial or other support in future periods.

The Funds’ investment portfolio consists of investments that they intend to hold for an indefinite period of time. However, to meet redemption requirements the Funds must trade in investee funds on a regular basis. Refer to Note 6(e) for liquidity risk

information. At balance date there were no amounts due to investee funds for unsettled purchases.

Note 3 – Investment assets and liabilities (continued)

20 21

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

PIE tax receivable on behalf of unitholders – – 1 – 8 – 5 – 5 –

Other receivables – – 1 – 8 – 5 – 5 –

Note 5 – Other receivables

Note 6 – Financial risk managementThe Funds’ investment portfolios consist of investments in unitised funds that they intend to hold for an indefinite period of time for the purpose of generating a return on investments made by the unitholders. Through the holding of these investments, the Funds are exposed directly and also indirectly to a variety of financial risks including credit, foreign exchange, interest rate, market price and liquidity risks. The risk management policies employed by the Funds are detailed in the notes below.

Financial instruments of the Funds comprise of investments in financial assets for the purpose of generating a return on investments made by unitholders. In addition, the Funds have financial instruments in the form of derivatives, cash and cash equivalents, other receivables, investment liabilities and other payables that arise directly from their daily operations.

The Master Trust Deed requires the Manager to invest the assets of each fund in accordance with relevant investment mandates. Asset allocation is determined by the Manager who manages the distribution of assets to achieve investment objectives. Divergence from target allocations and the composition of the portfolio is monitored by

the Manager on a daily basis. The Manager reports on asset allocations to the Trustee on a monthly basis.

(a) Credit risk

Credit risk is the risk that a counterparty will fail to perform contractual obligations, either in whole or in part, under a contract.

The Funds’ exposure to credit risk arises from the possibility of default of the counterparty, with the current maximum exposure considered to be the fair value of the assets set out in the Balance Sheet. This does not represent the maximum credit risk exposure that could arise in the future as a result of changes in values, but best represents the current maximum exposure at balance date.

The credit risk disclosures have been prepared on the basis of the Funds’ direct investments and not on a full look through basis for investments held indirectly through other unitised funds.

Where the Funds invest in unitised funds managed by the Manager (see Note 3), the investment strategies of these unitised funds ensure an appropriate diversification of investments to manage their credit risk.

The Funds are exposed to credit risk on derivative instruments. This may include counterparty risk with ANZ Bank

New Zealand Limited which is a related party to the Funds (see Note 7). The Funds restrict their exposure to credit losses on derivative instruments by entering into master netting arrangements with counterparties with whom they undertake a significant volume of transactions and holding collateral in the form of cash and marketable securities. Master netting arrangements do not result in an offset in the Balance Sheet as transactions are settled on a gross basis.

Derivative transactions are either transacted on an exchange or entered into under the International Swaps and Derivatives Association (ISDA) master netting agreements. Under ISDA master netting agreements in case a default occurs, all outstanding transactions under the agreement are terminated, the termination value is assessed and only a single net amount is due or payable in settlement of all transactions.

The amount of collateral accepted in respect of derivative assets is shown in the table on the following page.

None of the financial assets and financial liabilities are offset in the Balance Sheet. The disclosures set out in the tables on pages 22 to 25 include financial assets and financial liabilities that are subject to an

enforceable master netting arrangement or similar arrangement that covers similar financial instruments.

Similar agreements include derivative clearing agreements. The ISDA and similar master netting arrangements do not meet the criteria for offsetting in the Balance Sheet. This is because they create a right of set off of recognised amounts that is enforceable only following an event of default of the Funds or their counterparties. In addition, the Funds and their counterparties do not intend to settle on a net basis or to realise the assets and settle the liabilities simultaneously.

Usually the Funds receive and give collateral in the form of cash in respect of their investments in derivative instruments. However, no cash collateral was transferred as at balance date.

Such collateral is subject to the standard industry terms of ISDA’s Credit Support Annex. This means that securities received/given as collateral can be pledged or sold during the term of the transaction, but have to be returned on maturity of the transaction. The terms also give each counterparty the right to terminate the related transactions on the counterparty’s failure to post collateral.

22 23

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Derivative instruments

Gross amounts of recognised financial assets 74 – 343 – 666 – 750 – 426 –

Gross amounts of recognised financial liabilities offset in the Balance Sheet – – – – – – – – – –

Net amounts of financial assets presented in the Balance Sheet 74 – 343 – 666 – 750 – 426 –

Related amounts not offset in the Balance Sheet:

Financial instruments (including non-cash collateral) 2 – 10 – 4 – 13 – 3 –

Cash collateral transferred – – – – – – – – – –

Net amount 72 – 333 – 662 – 737 – 423 –

Note 6 – Financial risk management (continued)

Financial assets subject to enforceable master netting arrangements and similar agreements

24 25

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Derivative instruments

Gross amounts of recognised financial liabilities 2 77 10 280 4 467 13 663 3 296

Gross amounts of recognised financial assets offset in the Balance Sheet – – – – – – – – – –

Net amounts of financial liabilities presented in the Balance Sheet 2 77 10 280 4 467 13 663 3 296

Related amounts not offset in the Balance Sheet:

Financial instruments (including non-cash collateral) 2 – 10 – 4 – 13 – 3 –

Cash collateral transferred – – – – – – – – – –

Net amount – 77 – 280 – 467 – 663 – 296

Financial liabilities subject to enforceable master netting arrangements and similar agreements

The gross amounts of recognised financial assets and financial liabilities are measured at fair value. These financial assets and financial liabilities are presented in the Balance Sheet as part of ‘Investment assets’ and ‘Investment liabilities’. For detailed values refer to Note 3.

Cash and cash equivalents are held with ANZ Bank New Zealand Limited, which has a Standard & Poor’s credit rating of AA- at balance date (2014: AA-).

Forward foreign exchange contracts are held with ANZ Bank New Zealand Limited, Bank of New Zealand and Westpac Banking Corporation. All three banks have a Standard & Poor’s credit rating of AA- as at balance date (2014: AA-).


(a) Credit risk (continued)

26 27

(b) Foreign exchange risk

Foreign exchange risk is the risk that the New Zealand dollar-denominated fair value of a financial instrument will fluctuate due to changes in foreign exchange rates.

The foreign exchange risk disclosures have been prepared on the basis of the Funds’ direct investments and not on a full look through basis for investments held directly through other unitised funds.

The Funds hold investments in other unitised funds which in turn may hold foreign currency-denominated investments as part of their investment mandates. Consequently, these Funds will have varying degrees of indirect exposure to currency risk. These currency exposures can be partially or fully hedged back to the New Zealand dollar.

The Funds are directly exposed to foreign exchange risk as a result of holding forward foreign exchange contracts. These funds agree to receive or deliver a fixed quantity of foreign currency for an agreed upon price on an agreed future date. The fair value of these contracts is set out in Note 3.

The current foreign currency hedging policies are as follows:

The Funds are actively hedged with a benchmark of 65% and a range of 0% - 100% for their foreign currency exposure through their investment in the ANZ Wholesale International Share Fund. As at balance date, the Funds were hedging approximately 67% (2014: 55%) of their foreign currency exposure in the ANZ Wholesale International Share Fund.

The Funds are also actively hedged with a benchmark of 50% and a range of 0% - 100% for their Australian dollar exposure through their investments in the ANZ Wholesale Australian Share Fund and ANZ Wholesale Australasian Share Fund. As at balance date, the Funds were hedging approximately 50% (2014: 50%) of their Australian dollar exposure through their investments in the ANZ Wholesale Australian Share Fund and the ANZ Wholesale Australasian Share Fund.

In accordance with the Manager’s policy on foreign exchange risk management, the Manager monitors each fund’s currency position on a daily basis through reviewing

and comparing each fund’s indirect foreign currency exposure to the pre-determined foreign currency hedging policies (as above).

(c) Market price risk

Market price risk is the risk that the value of the Funds’ investment portfolios will fluctuate as a result of changes in market prices.

The market price risk disclosures have been prepared on the basis of the Funds’ direct investments and not on a full look through basis for investments held indirectly through other unitised funds.

The Funds trade in financial instruments such as equities and cash. They may also take positions in traded and over-the-counter instruments, including derivatives, to manage market risk and efficiently gain the desired exposure to equity markets. All securities held within the Funds present a risk of loss of capital. The Manager moderates this risk through a careful selection of securities and other financial instruments and by ensuring that all activities are transacted in accordance with relevant investment mandates, overall

investment strategy and within approved limits. The Manager monitors the Funds’ overall market position on a daily basis.

Effect of a change in investments in other unitised funds

The increase/(decrease) in the net asset value of the Funds due to a reasonably possible change in the unit prices of investments in other unitised funds with all other variables held constant is indicated in the table below.

The Manager considers a 0.50% change in the unit price of investments in other unitised funds is a reasonable estimate of possible changes in the average daily unit price in the unitised funds considering factors such as historical price movements and market conditions.

% change in unit price

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Change in the fair value of investments in other unitised funds based on the percentage change in their unit prices

+0.50 225 131 593 308 789 369 655 409 305 149

-0.50 (225) (131) (593) (308) (789) (369) (655) (409) (305) (149)


28 29


(d) Interest rate risk

Interest rate risk arises from the possibility that changes in interest rates will affect the fair value of future cash flows or the fair value of financial instruments. The interest rate risk disclosures have been prepared on the basis of the Funds’ direct investments and not on a full look through basis for investments held indirectly through other unitised funds.

The majority of the Funds’ financial assets and liabilities are non-interest bearing. As a result, the Funds are not directly subject to significant amounts of risk due to fluctuations in the prevailing levels of market interest rates. Cash and cash equivalents are invested at short-term market interest rates and are held in call accounts.

The Funds have indirect exposure to interest rate risk through their investments in other unitised funds with cash and fixed interest mandates.

(e) Liquidity risk

Liquidity risk is the risk that the Funds may not be able to generate sufficient cash resources to settle their obligations 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 units. Accordingly, all material investments are readily convertible to cash in normal market conditions.

The liquidity risk disclosures have been prepared on the basis of the Funds’ direct investments and not on a full look through basis for investments held indirectly through other unitised funds.

Forward foreign exchange contracts that were held at balance date had a contractual maturity date of 29 October 2015.

Financial liabilities of the Funds comprise other payables, which have no contractual maturity date, but are typically settled within 30 days or within the timeframe as set out in the Trust Deed. The Funds may also invest in derivatives that could be in a loss position at balance date that may affect the future cash flows of the Funds. Refer to Note 3 for these derivatives in a loss position at balance date.

In accordance with each fund’s investment policy, the Manager monitors the Funds’ liquidity positions daily through the review of cash flow information which highlights current and known future levels of redemptions.

(f) Fair value information

The Funds hold investments in other unitised funds. Consequently, the Funds are indirectly exposed to the fair value of these underlying unitised funds. In determining the redemption value of the unitised funds, the Manager will generally draw reference to quoted prices from a recognised exchange in determining the fair value of investments. Where such prices are unavailable or there is an absence of an active quoted market, the Manager may use valuation techniques in determining the fair value of investment assets. In particular, for the funds with investments in unitised funds with exposure to certain debt securities, the determination of fair value within these unitised funds will include the use of broker quotes, yield curves and other internal Manager pricing methodologies.

The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety shall be 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.

For cash and cash equivalents, other receivables and other payables their carrying value approximates their fair value. They are considered to be Level 2 assets and liabilities (2014: Level 2).

The forward foreign exchange contracts are considered Level 2 (2014: Level 2) as they are priced using models with observable market inputs. Forward foreign exchange contracts are interpolated using forward rates from WM Company. Margins and swaps used as inputs are generally provided by market participants and brokers.

Level 2 investments also include investments in unitised funds. These investments are priced daily and the inputs are based on quoted market prices, broker prices and other pricing valuations used by the Manager. As these are unlisted they are Level 2 investments.

30 31

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Assets:

Cash and cash equivalents 3 3 3 3 3 2 3 3 3 3

Forward foreign exchange contracts 42 – 191 – 377 – 422 – 242 –

Total assets 45 3 194 3 380 2 425 3 245 3

Liabilities:

Forward foreign exchange contracts 2 60 10 215 4 360 13 515 3 229

Total liabilities 2 60 10 215 4 360 13 515 3 229

Note 7 – Related party transactions

The Manager

The Manager of the Funds is ANZ New Zealand Investments Limited (‘ANZ Investments’).

ANZ Wealth New Zealand Limited (‘ANZ Wealth’) the holding company of the Manager, is a wholly owned subsidiary of ANZ Bank New Zealand Limited, part of the Australia and New Zealand Banking Group (the ‘ANZ Group’). ANZ Group is the ultimate parent of ANZ Wealth.

The Funds hold bank accounts and forward foreign exchange contracts with ANZ Bank New Zealand Limited.

Transactions between the Manager of the Funds and related parties

All related party transactions are conducted on an arm’s length basis in the ordinary course of business and on standard commercial terms and conditions.

As at balance date, the Funds held the following balances with ANZ Bank New Zealand Limited.

32 33

Note 7 – Related party transactions (continued)

During the year, the income received from the related party transactions above were as follows:

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Interest from cash and cash equivalents 8 – 22 1 29 1 27 1 12 –

Net change in fair value of investment assets and liabilities held for trading (413) (50) (1,975) (272) (3,694) (448) (4,333) (547) (2,364) (303)

Total loss from related party transactions (405) (50) (1,953) (271) (3,665) (447) (4,306) (546) (2,352) (303)

Management fees

Under the terms of the Master Trust Deed, the Manager is entitled to receive management fees, calculated by reference to the daily net asset value of the Funds.

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Management fees payable to the Manager at the end of the year 39 23 107 55 151 69 132 80 64 30

The Manager receives the following percentage per annum of the net asset value of the Funds, determined upon each valuation day 1.05% 1.05% 1.10% 1.10% 1.15% 1.15% 1.20% 1.20% 1.25% 1.25%

Management fees paid for the year are disclosed in the Income Statement and are shown net of any management fee rebates.

34 35

Reimbursement of expenses

Under the terms of the Master Trust Deed, the Manager and Trustee are entitled to be reimbursed for expenses such as audit costs, postage and legal fees incurred on behalf of the Funds. Allowance for these expenses is charged to the Funds daily and is reflected in the unit price of each fund. To ensure fair allocation of one-off-type expenses and fees incurred annually, the Funds are charged

a set capped rate as a percentage of each fund’s net asset value on a daily basis. The total of this daily accrual is the maximum that the Funds will pay the Manager for reimbursement of expenses. Where the actual expenses paid by the Manager are higher, the Manager may carry amounts forward to be recovered in future periods.

* Other expenses within the Income Statement include the other costs noted above and bank fees. The amounts presented above are after audit fee reallocations.

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

Manager's other costs recognised in the Income Statement* 30 28 78 54 99 60 52 81 45 21 Amounts payable to the Manager for reimbursement of expenses at the end of the year 9 8 25 19 34 21 29 25 13 9

Note 7 – Related party transactions (continued)

36 37

Conservative Fund


Balanced Fund


Growth Fund

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000

2015 $000

2014 $000


Movement in operating balances

Investment assets (18,971) (1,019) (57,402) (26,234) (84,565) (36,953) (49,976) (23,414) (31,579) (14,990)

Investment liabilities (75) 76 (270) 278 (463) 465 (650) 658 (293) 294

Other payables 18 – 63 32 103 44 59 27 41 20

Net cash flows from operating activities (17,027) 780 (52,187) (22,191) (77,820) (31,786) (42,559) (15,487) (28,949) (12,136)

Conservative Fund


Balanced Fund


Growth Fund

2015 000’s

2014 000’s

2015 000’s

2014 000’s

2015 000’s

2014 000’s

2015 000’s

2014 000’s

2015 000’s

2014 000’s

Units on issue

Units on issue at the beginning of the year 20,134 20,783 45,358 28,349 52,187 28,892 55,103 44,192 19,482 11,058

Units issued during the year 16,402 3,300 46,585 19,113 63,237 26,409 37,696 15,408 22,449 10,160

Units redeemed during the year (3,852) (3,949) (9,845) (2,104) (10,820) (3,114) (10,106) (4,497) (4,584) (1,736)

Units on issue at the end of the year 32,684 20,134 82,098 45,358 104,604 52,187 82,693 55,103 37,347 19,482

Note 8 – Reconciliation of net profit to net cash flows from operating activities

Note 9 – Unitholders’ funds Unitholders are entitled to one vote per unit at a meeting of the unitholders, and rank equally with regard to each fund’s assets.

38 39

Independent auditor’s report

To the unitholders of:• The Unit Trusts – Conservative Fund

• The Unit Trusts – Conservative Balanced Fund

• The Unit Trusts – Balanced Fund

• The Unit Trusts – Balanced Growth Fund

• The Unit Trusts – Growth Fund

(the ‘Funds’), which form part of ‘The Unit Trusts’ collectively marketed as the ANZ Investment Funds and the OneAnswer Investment Funds – Multi-Asset Class.

Report on the financial statementsWe have audited the accompanying financial statements of the Funds on pages 4 to 37. The financial statements comprise the balance sheet as at 30 September 2015, the income statement, changes in equity and cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information.

Manager’s responsibility for the financial statements

The Manager is responsible on behalf of the Funds for the preparation of financial statements in accordance with generally accepted accounting practice in New Zealand and International Financial Reporting Standards that give a true and fair view of the matters to which they relate, and for such internal control as the Manager determines is necessary to enable the preparation of financial statements that are free from material misstatement whether due to fraud or error.

Auditor’s responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing (New Zealand). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Funds’ preparation of the financial statements that give a true and fair view of the matters to which they relate in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates, as well as evaluating the presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Our firm has also provided other services to the Funds in relation to prospectus, trustee reporting and semi-annual controls.

Subject to certain restrictions, partners and employees of our firm may also deal with the Funds on normal terms within the ordinary course of trading activities of the business of the Funds. These matters have not impaired our independence as auditor of the Funds. The firm has no other relationship with, or interest in, the Funds.

Opinion

In our opinion the financial statements on pages 4 to 37:

• comply with generally accepted accounting practice in New Zealand;

• comply with International Financial Reporting Standards;

• give a true and fair view of the financial position of the Funds as at 30 September 2015 and of its financial performance and cash flows for the year then ended.

Report on other legal and regulatory requirementsIn accordance with the requirements of sections 16(1)(d) and 16(1)(e) of the Financial Reporting Act 1993, we report that:

• we have obtained all the information and explanations that we have required; and

• in our opinion, proper accounting records have been kept by The Unit Trusts as far as appears from our examination of those records.

11 December 2015 Auckland

Directory

40

Directors of Manager

John Robert Body Stewart Creswell Brentnall Penelope Jane Ford Gavin Murray Pearce Craig Lionel Sims (resigned 10 April 2015) Ronald Bruce Macintyre (appointed 10 April 2015)

Auditor

KPMG

Chartered AccountantsKPMG Centre18 Viaduct Harbour Avenue PO Box 1584 Auckland 1140

Trustee

The New Zealand Guardian Trust Company Limited

Level 15, 191 Queen Street Auckland 1010 PO Box 1934 Auckland 1140

Solicitor

Chapman Tripp

23 Albert Street PO Box 2206 Auckland 1140

For information only: This document has been provided for information purposes only. Its content is intended to be of a general nature and does not take into account an investor’s, or potential investor’s, financial situation, investment objectives or risk tolerance.

Performance: Past performance is not indicative of future performance. The actual performance realised by any given investor: (i) will depend on many things; (ii) is not guaranteed; and (iii) may be negative as well as positive. Unless otherwise indicated, investment performance is shown after expenses and before tax.

Not investment advice: This document is not intended to constitute, does not constitute, and should not be construed as constituting, investment advice nor is it a substitute for commercial judgment or other professional advice. Investors, or potential investors, should: (i) conduct independent due diligence on any investment; and (ii) obtain independent investment and professional advice, prior to acting in reliance on this document.

Not deposits in ANZ Group: The investment(s) referred to in this document are not deposits in ANZ Bank New Zealand Limited or Australia and New Zealand Banking Group Limited (together ‘ANZ Group’), nor are they liabilities of ANZ Group. ANZ Group does not stand behind or guarantee ANZ New Zealand Investments Limited.

Risks: Investment(s) referred to in this document are subject to many risks including possible delays in repayment, loss of income, or the total loss of the principal invested. ANZ Group will not be liable to you for the capital value or performance of your investment.

No guarantee: The investment(s) referred to in this document are not guaranteed by ANZ Group, The New Zealand Guardian Trust Company Limited, any of their directors or any other person.

No liability or responsibility: To the maximum extent permitted by law, ANZ Group disclaims any liability or responsibility to any person for any direct or indirect loss or damage that may result from any act or omission by any person in relation to, or in reliance on, the information supplied in this document.

Speak to an authorised financial adviser: This document is not a personalised financial adviser service under the Financial Advisers Act 2008. It is recommended you seek advice from an authorised financial adviser which takes into account your individual circumstances before you acquire a financial product. If you want financial advice about ANZ Investment Funds, please call 0800 269 238 to speak with an ANZ Authorised Financial Adviser. An ANZ Authorised Financial Adviser will, on request and free of charge, provide you with his or her disclosure statement prepared under the Financial Advisers Act 2008.

© 2015 Morningstar, Inc. All rights reserved. Neither Morningstar, its affiliates, nor the content providers guarantee the data or content contained herein to be accurate, complete or timely nor will they have any liability for its use or distribution. Any general advice or ‘class service’ have been prepared by Morningstar Australasia Pty Ltd (ABN: 95090 665 544, AFSL: 240892) and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. Refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/s/fsg.pdf. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement (Australian products) or Investment Statement (New Zealand products) before making any decision to invest. Our publications, ratings and products should be viewed as an additional investment resource, not as your sole source of information. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Some material is copyright and published under licence from ASX Operations Pty Ltd ACN 004 523 782 (‘ASXO’).

Fund Manager of the Year Awards are announced by FundSource, the investment strategy and research company. These awards should not be read as a recommendation by FundSource. For further advice on the relevance of this award to your personal situation consult your authorised financial adviser, or visit www.fundsource.co.nz.

Manager

ANZ New Zealand Investments Limited

ANZ Centre Ground Floor, 23-29 Albert Street Auckland 1010 PO Box 7149, Wellesley Street Auckland 1141

0800 736 034

[email protected]

AN

Z New

Zealand Investments Lim

ited A1220 12/15 17935

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