SAS FORTUNE FUND LIMITED ANNUAL REPORT AND FINANCIAL STATEMENTS

SAS FORTUNE FUND LIMITED 2015 ANNUAL REPORT AND FINANCIAL STATEMENTS SAS FORTUNE FUND LIMITED ANNUAL REPORT AND FINANCIAL STATEMENTS DECEMBER 31...
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SAS FORTUNE FUND LIMITED

2015

ANNUAL REPORT

AND FINANCIAL STATEMENTS

SAS FORTUNE FUND LIMITED

ANNUAL REPORT AND FINANCIAL STATEMENTS DECEMBER 31, 2015

SAS FORTUNE FUND LIMITED CORPORATE INFORMATION The Manager: SAS Investment Management Ltd. (SAS-IM) 14th Floor WTCA Building, Indep. Avenue, Accra Tel: +233-302-661770/2/008/880 +233-302-661900 Fax: +233-302-663999 E-mail: [email protected] Website: www.sasghana.com Directors of the Fund: Maxwell Logan (Chairman) Togbe Afede XIV Apiigy Afenu Nana Soglo Alloh Paul Hammond The Custodian: Standard Chartered Securities Services Head Office P. O. Box 768 Accra Independent Auditors: Nexia Debrah & Co. BCB Legacy House # 1 Nii Amugi Avenue East Adabraka, Accra P. O. Box CT 1552 Cantonments, Accra Solicitors R. S. Agbenoto and Associates 4th Floor Total House 25 Liberia Road

REPORTS AND FINANCIAL STATEMENTS

Secretary: Accra Nominees Cedar House No. 13 Samora Machel Road Asylum Down, Accra

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Corporate Information

4

Notice of Meeting

6

Chairman’s Report

8

Fund Manager’s Report

10

Report of the Directors

12

Statements of Directors’ Responsibility

13

Report of the Auditors

14-15

Statement of Investment Assets

16-17

Statement of Assets and Liabilities

18

Income and Distribution Account

19

Statement of Movements in Net Assets and Issued Shares

20

Portfolio Summary

21

Notes to the Financial Statements Schedule Report of the Custodian Information on Directors and Officers

22-25 26 27-28 29 REPORTS AND FINANCIAL STATEMENTS

CONTENTS

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SAS FORTUNE FUND LIMITED NOTICE OF MEETING NOTICE is hereby given that the 11th Annual General Meeting of the Members of The SAS Fortune Fund will be held on Thursday August 4, 2016 at the College of Physicians and Surgeons, Ridge, Accra at 10.30 a.m. to transact the following ordinary business:1. To receive and adopt the Audited Financial Statements for the year ended December 31, 2015 together with the Reports of the Directors and Auditors thereon. 2. To re-elect Directors. 3. To fix Directors’ Remuneration for the ensuing year 4. To authorise the Directors to negotiate and determine the remuneration of the Auditors for the ensuing year. BY ORDER OF THE BOARD ACCRA NOMINEES LIMITED COMPANY SECRETARIES Registered Office, Accra. Dated this 11th day of July, 2016 NOTE: A member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote instead of him/her and such proxy need not be a member of the Fund.

REPORTS AND FINANCIAL STATEMENTS

A proxy form is attached. Executed forms of proxy should be deposited at the Registered Office of the Fund Manager, 14th Floor Accra World Trade Centre, Independence Avenue, Accra, not less than 48 hours prior to the time of the meeting.

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SAS FORTUNE FUND LIMITED ADMISSION CARD To the 11thAnnual General Meeting of Members to be held on Thursday August 4, 2016 at the College of Physicians and Surgeons, Ridge, Accra, at 10.30 a.m. NOTE: a) This admission card must be produced by the shareholder or his proxy in order to obtain entrance to the Annual General Meeting. b) Shareholders or their proxies are requested to sign the admission card before attending this meeting.

…………………………………………………………………………………………………… Name of Shareholder

…………………………............ …………………………............

REPORTS AND FINANCIAL STATEMENTS

Signature Date

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SAS FORTUNE FUND LIMITED CHAIRMAN’S REPORT

Dear Shareholders, It is with great pleasure that I present to you, the performance of your FUND for the year ended 31st December, 2015; a year in which the FUND was faced with stock market volatilities and macroeconomic challenges. Nevertheless, the SAS Fortune Fund, in spite of the harsh economic and investment climate, has been able to maintain a lead role over its benchmark Ghana Stock Exchange Composite Index. Operating Environment Global economies again fell short of expectations in 2015, slowing to a growth rate of 2.4 percent from 2.6 percent in 2014. The disappointing performance mainly reflected a continued growth deceleration in emerging and developing economies during post-crisis lows in commodity prices, weaker capital flows and subdued global trade. Global financial market volatility consequently rose noticeably in 2015 against the backdrop of slowing activity in large emerging economies, diverging monetary policies of major central banks, continued declines in commodity prices, and fragile liquidity conditions. Ghana’s economy as measured by GDP expanded by 3.9 percent in 2015 (Ghana Statistical Service), lower than 4 percent in 2014. This is the slowest growth rate in 20 years. Ghana’s economy also faced numerous challenges during the year 2015. Inflation was 17.70% as at December 2015 as compared to 16.40% in the previous year. The main drivers were attributable to the non-food group, utility price increases and an increase in transport fares. Similarly, the cedi also lost 18% of its value against the US dollar in 2015 but however remained relatively stable following the issue $1 billion Eurobond in October. The 91 days and 182 days Treasury bill rates also dropped by 11.28% and 7.45% at the end of 2015 as compared to end of 2014. These drop were at the backdrop of the issuer’s (Government of Ghana) appetite for relatively longer dated treasury bonds to finance medium to long term projects. REPORTS AND FINANCIAL STATEMENTS

The stock market which the SAS Fortune Fund predominantly invested also posted an abysmal performance during the year 2015. The Composite Index which is a benchmark performance index of the Ghana stock exchange recorded -11.77% at the end of 2015

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compared to 5.04% recorded at the end of 2014. Not only did the Ghana stock exchange experience a poor performance during 2015; 15% capital gain tax on securities listed on the Ghana Stock Exchange was also introduced during the year even though the Ghana Securities Industry Association (GSIA) together with the Stock Exchange are petitioning its reverse. The effect of the 15% capital gain tax and 8% withholding tax on dividend is that investment into the Ghana stock exchange will remain unattractive. The Fund The total net asset value of SAS Fortune Fund Ltd at the end of the 2015 stood at GH¢2,971,909 and representing about 5% decrease over the previous year’s total net asset value of GH¢ GH¢3,126,788. The decrease is attributable to redemptions made by shareholders and partly a reflection of the poor performance of the Ghana Stock Exchange during the year since the Fund invested mainly in this market. The Fortune Fund made a year-to-date return of -0.71% as against the return on Ghana Stock Exchange Composite Index (GSE CI) of -11.77%. The Fund still outperformed its benchmark GSE CI during the year and remained an attractive investment vehicle for our shareholders and potential shareholders. In spite of the economic and environmental challenges, we believe and remain positive about the future prospect of the economy and the market in which the Fund operates. As Treasury bill rates fall as we are witnessing currently, there would be a corresponding increase in the activities in the stock market. I therefore recommend to you to buy more shares of SAS Fortune Fund since the price is low now. I would like to thank you for your trust and confidence you have in the Fund and in us over the past years. We believe that SAS Fortune Fund would not only give you a competitive return but also remain one of the best equity mutual funds in Ghana. REPORTS AND FINANCIAL STATEMENTS

Thank you. Maxwell Logan Chairman

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SAS FORTUNE FUND LIMITED FUND MANAGER’S REPORT Dear Shareholders, It is our pleasure to once again welcome you to the 11th Annual General meeting of the SAS Fortune Fund Limited. The fund manager’s report will touch on the general economic landscape within which the fund operated and the outlook for 2016. Economic Outlook Global economic activities remained subdued in 2015 and Ghana’s economy was no exception. The domestic economy in the final quarter of 2015 witnessed signs of recovery stemming from a relatively stable inflation and exchange rate. The country recorded a growth rate of 4.9% as compared to 4.4% the previous year. The government’s economic policy resulted in a marginal increase in inflation to 17.70% in 2015 as compared to 17.00% in 2014. As part of the central bank’s measure to maintain a stable currency, the policy rate saw a marginal increase through 2015 and closed the year with 26.00%. Also, as part of measures to reduce government’s cost of borrowing and correct the yield curve, the benchmark 91-days and 182-days Treasury bill rates declined by 11.27% and 7.42% from 25.81% and 26.41% in 2014 to 22.90% and 24.45% in 2015 respectively. Whereas the 1 Year-Note and 2 Year Note rates increased marginally by 2.22% and 1.30% from 22.50% and 23.00% in 2014 to 23.00% and 23.30% in 2015 respectively. Stock Market Review Trading activities on the stock market recorded again a flinching pattern during the year. A total of 246,450,981 shares valued at GH¢247,649,862.21 were traded as compared to 169,864,133 shares valued at GH¢312,877,322 in 2014. This represents a 46% increase in volume traded and a 21% decrease in value traded. At the end of 2015, the total number of listed equities increased from 37 in 2014 to 44 in 2015. In all, ten (10) equities recorded price gains whilst nineteen (19) equities recorded losses. The top five (5) gainers for the year 2015 with significant change in prices were Aluworks (600%), Starwin (100%), Trust Bank Gambia (54.17%), Fan Milk (40%) and Enterprise Group (37.14%). Among the top five (5) losers, also with significant negative change in prices were Golden Web (66.67%), SIC Insurance (62.16%), UT Bank (60%), HFC Bank (40%) and Benso Oil (39.02%). REPORTS AND FINANCIAL STATEMENTS

Major activities on the market included the listing of five companies on the Ghana Alternatives Market (GAX), bonus issues by Societe Generale Ghana and Ecobank Transnational Inc. and also, the introduction of the Ghana Fixed Income Market (GFIM). Market Capitalization declined by 15% from GH¢67.3 billion in 2014 to GH¢57.1 billion in 2015.

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Investment Objective and Policy The investment objective of the Fund is to achieve long-term capital growth for its shareholders, by investing a greater portion of its assets in companies with strong fundamentals, strong growth trends and strong income generation potential. The fund meets its liquidity obligations by investing in short term fixed income securities. Fund Performance The unit price of the fortune fund decreased by GH¢0.0036 to close the year at GH¢0.5064. The fund made a total return of negative 0.71% as compared to the GSE Composite index of negative 11.77%. Although, the fund’s return was not in the positive, it outperformed all the major indices including the GSE Composite Index (-11.77%), GSE Financial Stock Index (-13.98%), SAS Financial Index (-16.62%), SAS Manufacturing Index (-7.36%) and the SAS Index (-13.55%). As it is characterized with bearish market, investors with medium to low risk appetite cash out on their investments and this resulted in a reduction of the funds value from GH¢3,113,817 to GH¢2,971,909. It is however recommended that investors buy more when prices are low. The fund’s performance as compared to benchmark indices was as a result of prudent measures put in place to ensure that the fund is well diversified to reduce the impact of the bearish market experienced in 2015. We will continue to monitor the overall economic indicators and take advantage of investment opportunities with blue chip companies who have stable business models. We will also continue with the active re-balancing of the fund when necessary to generate value for shareholders. 2016 Outlook

REPORTS AND FINANCIAL STATEMENTS

The economic outlook in Ghana is brightening, with GDP growth gaining momentum in the first two months of 2016. Under the IMF deal in April 2015, Ghana is looking to slow public spending and reduce the budget deficit. Significant progress has been made in this direction in 2015, and the government is looking to reduce further fiscal deficit from 7.3% in 2015 to 5.75% in 2016. The stock market is expected to bounce back into action as we see the Government of Ghana Treasury bill rates fall and heightened interest of companies that want to be listed on the market. With your confidence in the fund, we will continue to ensure growth of the asset values of the fund. We will continue to invest the assets of the fund in high valued stock. We will continue to beat the GSE-CI benchmark and will continue to remain an attractive equity mutual fund in Ghana. Thank you Anthony A. Degbato Head of Asset Management

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REPORT OF THE DIRECTORS TO THE MEMBERS OF SAS FORTUNE FUND LIMITED

We have the pleasure in submitting the annual reports and audited Financial Statements of SAS Fortune Fund Limited for the year ended December 31, 2015 and report thereon as follows: As directors, we are responsible for the preparation of financial statements for each financial year, which give a true and fair view of the state of affairs of the Fund and of the statement of operations for the year. In preparing these financial statements, we have selected suitable accounting policies and applied them consistently, made adjustments and estimates that are reasonable and prudent and followed Accounting Standards acceptable in Ghana.

REPORTS AND FINANCIAL STATEMENTS

As directors, we are also responsible for ensuring that the Fund keeps proper accounting records that disclose with reasonable accuracy at any time its financial position and performance. We are also responsible for safeguarding the assets of the Fund and taking reasonable steps for the prevention and detection of fraud and other irregularities.

Nature of Business The Company is licensed by the Securities and Exchange Commission to operate as an authorized mutual fund and is regulated by the Unit Trusts and Mutual Funds Regulations L.I 1695. There was no change in the nature of business of the company during the year under review. Financial Results & Income Distribution The results for the year are as set out in the attached financial statements. The Fund does not distribute income and thus all income earned is reinvested. Auditors Messrs Nexia Debrah & Co have indicated their willingness to continue in office as auditors in accordance with Section 134(5) of the Companies Act 1963 Act 179.

Director Director ACCRA 15th April 2016

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SAS FORTUNE FUND LIMITED STATEMENT OF DIRECTORS’ RESPONSIBILITY

The directors are responsible for keeping proper books of accounts, which disclose with reasonable accuracy at any time the financial position of the company. The directors are also responsible for safeguarding the assets of the company and taking reasonable steps for the prevention and detection of fraud and other irregularities through the design and implementation of appropriate internal control structure.

The internal controls include a riskbased system of internal accounting and administrative controls designed to provide reasonable but not absolute assurance that assets are safeguarded and that transactions are executed and recorded in accordance with generally accepted business practices and the company’s policies and procedures. The financial statements are prepared in accordance with International Accounting Standards (IAS) and incorporate disclosures in line with the accounting philosophy of the company. The financial statements are also based on appropriate accounting policies consistently applied and supported by reasonable and prudent judgements and estimates.

REPORTS AND FINANCIAL STATEMENTS

Under the Companies Act 1963 (Act 179), the directors of the company are responsible for preparing in respect of each financial year, financial statements which give a true and fair view of the state of affairs of the company, and of its Profit or Loss and Cash Flows for that year in accordance with Accounting Standards acceptable in Ghana. In preparing these financial statements the directors are required to select suitable accounting policies and then apply them consistently, make judgments and estimates that they are reasonable and prudent.

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REPORT OF THE AUDITORS TO THE MEMBERS OF SAS FORTUNE FUND LIMITED

We have audited the Financial Statements of SAS Fortune Fund Limited for the year ended 31st December 2015 which are presented herein from pages 16 to 25. The principal accounting policies used in preparing these financial statements are set out on pages 22 to 25. Our report is made solely to the company’s members, as a body, in accordance with section 133 of the Companies Act 1963 (Act 179). The purpose of our audit is to enable us to make a statement to the members of the company on those matters specifically required by law to be mentioned in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and its members as a body for our audit work, our report, or the opinions we have expressed herein. RESPECTIVE RESPONSIBILITIES OF THE DIRECTORS AND AUDITORS The Company’s Directors acknowledge on page 13 their responsibility for the preparation and fair presentation of these Financial Statements in accordance with accounting standards applicable in Ghana and for the detection and prevention of fraud or other irregularity. Our responsibility as Auditors is to express an independent opinion on the Financial Statements based on our audit.

REPORTS AND FINANCIAL STATEMENTS

BASIS OF OPINION We conducted our audit in accordance with auditing standards. An audit includes examination on a test basis, of evidence relevant to the amounts and disclosures in the Financial Statements. It also includes an assessment of the significant estimates and judgment made by the Directors in preparing these Financial Statements, and of whether the accounting policies are appropriate to the company, consistently applied and adequately disclosed.

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REPORT OF THE AUDITORS TO THE MEMBERS OF SAS FORTUNE FUND LIMITED

We planned and performed the audit so as to obtain all the information and explanation, which we considered necessary in order to provide us with sufficient evidence and reasonable assurance that the Financial Statements are free from material misstatements. In forming our opinion, we also evaluated the overall adequacy of the presentation of information in the Financial Statements and also had regard to the matter referred to below. OPINION In our opinion, proper books have been kept and the financial statements which are in agreement therewith present fairly, the financial position of the company as at December 31, 2015 and of the results of operations for the year then ended and comply with the International Accounting Standards, the Unit Trusts and Mutual Funds Regulations L.I 1695 and the Companies Act, 1963 (Act 179).

Signed on behalf of Nexia Debrah & Co. (ICAG/F/069) Chartered Accountants BCB Legacy House # 1 Nii Amugi Avenue East Adabraka, Accra REPORTS AND FINANCIAL STATEMENTS

By K. Manu-Debrah (ICAP/P/1264) 18th April 2016

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SAS FORTUNE FUND LIMITED

STATEMENT OF INVESTMENT ASSETS AS AT DECEMBER 31, 2015

Number of Shares

2015 Market Value GH¢

2014 Market Value GH¢

61,745

8,644

1,235

43,470

319,505

228,217

60,094

60,094

60,695

14.29

60,549

424,449

587,769

1.05

116,320

31,406

30,534

Ghana Commercial Bank (GCB)

17.79

139,422

528,409

738,937

Standard Chartered Bank (SCB)

8.28

15,096

246,065

307,204

SG-SSB Bank (SG-SSB)

1.72

63,958

51,166

58,144

1,341,589

1,783,282

Consumer Products

0.82

Patterson Zochonis (PZ)

0.71

61,812

21,016

18,543

Unilever (UNIL)

0.11

400

3,400

4,280

24,416

22,824

260,400

195,300

QUOTED EQUITY

%Net Assets

Manufacturing

0.29

Aluworks (ALW)

0.29

Dairy Products

10.75

Fan Milk Ltd (FML)

10.75

Banking

45.15

CAL Bank (CAL) Ecobank (EBG) Ecobank Transnational (ETI)

REPORTS AND FINANCIAL STATEMENTS

Petroleum

12.36

Ghana Oil (Goil)

8.79

186,000

Total Ghana Limited (Total)

3.57

20,800

106,080

126,880

366,480

322,180

117,346

Insurance

5.96

Enterprise Insurance (EIC)

5.42

67,055

160,932

State Insurance Company (SIC)

0.54

113,500

15,890

41,995

176,822

159,341

2,237,456

2,517,079

TOTAL QUOTED EQUITY

16

2.02

73.35

1,010,221

SAS FORTUNE FUND LIMITED

STATEMENT OF INVESTMENT ASSETS AS AT DECEMBER 31, 2015 FIXED INCOME/ SHORT TERM

%Net Assets

Number of Shares

2015 Market Value GH¢

2014 Market Value GH¢

91 Day Treasury Bills

9.57

284,228

422,808

182 Day Treasury Bills

14.77

438,731

114,955

24.34

722,959

537,763

0.31

9,286

85,154

24.65

732,245

622,917

100.00

2,969,701

3,139,996

TOTAL FIXED INCOME/SHORT-TERM TOTAL INVESTMENTS

REPORTS AND FINANCIAL STATEMENTS

Cash at Bank and on Call

17

SAS FORTUNE FUND LIMITED STATEMENT OF ASSETS AND LIABILITIES AS AT DECEMBER 31, 2015 ASSETS

Notes

Sundry Accounts Receivable (Schedule A)

2015 GH¢

2014 GH¢

19,497

11,039

Investment Assets

2,969,701

3,139,996

Total Assets

2,989,198

3,151,035

Accrued Expenses Payable Others (Schedule B)

17,289

7,587

-

16,660

Total Liabilities

17,289

24,247

2,971,909

3,126,788

1,401,031

1,430,166

LIABILITIES

NET ASSETS SHAREHOLDERS’ FUND

REPORTS AND FINANCIAL STATEMENTS

Capital Accounts Accumulated Income Account

1,570,878

1,696,622

Balance at December 31st

2,971,909

3,126,788

Director Director ACCRA 15th April 2016

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8

SAS FORTUNE FUND LIMITED INCOME AND DISTRIBUTION ACCOUNTS FOR THE YEAR ENDED AS AT DECEMBER 31, 2015 Notes

2015 GH¢

2014 GH¢

123,471

106,738

Investment Income Dividend Income Interest Income

2

171,349

162,840

Other Income

3

19,214

12,097

314,034

281,675

61,428

63,924

Total Investment Income Expenses Management Fees Other Expenses

4

Total Expenses Net Investment Income before Capital Gains/ (Losses) Net Realized Capital Gain

34,058 97,982

215,627

183,693

5

8,764

-

224,391

183,693

7

(152,026)

270,733

72,365

454,426

Net Investment Income Net Unrealized Capital Gain/(Loss)

36,979 98,407

Net Income/ (Loss) Transferred to Accumulated Income Account

Balance at January 1st

2015 GH¢

2014 GH¢

1,696,622

1,459,529

Redemptions/Withdrawals

(198,109)

(217,333)

Balance before Transfers

1,498,513

1,242,196

72,365

454,426

1,570,878

1,696,622

REPORTS AND FINANCIAL STATEMENTS

ACCUMULATED INCOME ACCOUNT FOR THE YEAR ENDED DECEMBER 31, 2015

Net Income Transferred From Income and Distribution Account Balance as at 31st December

19

SAS FORTUNE FUND LIMITED STATEMENT OF MOVEMENT IN NET ASSETS FOR THE YEAR ENDED DECEMBER 31, 2015 INCREASE IN NET ASSETS

2015 GH¢

2014 GH¢

215,627

183,693

8,764

-

From Operations: Net Investment Gains Before Capital Gains Net Realised Capital Gain Net Unrealised Gain

(152,026)

270,733

(Loss)/Gains on Redemptions

(198,109)

(217,333)

Net Increase From Operations

(125,744)

237,093

367,712

775,819

(396,847)

(478,879)

(29,135)

296,940

From Capital Transactions: Proceeds From Issue of Shares Cash outflow for Shares Redeemed Net cash Inflow/ (outflow) for Capital Transactions Net Increase/ (Decrease) In Assets

(154,879)

534,033

Net Assets at January 1st

3,126,788

2,592,755

Net Assets at December 31st

2,971,909

3,126,788

STATEMENT OF MOVEMENT IN ISSUED SHARES FOR THE YEAR ENDED DECEMBER 31, 2015

Balance at January 1st REPORTS AND FINANCIAL STATEMENTS

Issue of Shares

Redemption of Shares Net Assets at December 31st

20

2015 No. of Shares

2014 No. of Shares

6,249,518

6,030,322

724,580

1,669,396

6,974,098

7,729,718

(1,140,207)

(1,480,200)

5,833,891

6,249,518

SAS FORTUNE FUND LIMITED PORTFOLIO SUMMARY AS AT DECEMBER 31, 2015 Position 31/12/14 No. of Sh.

Mkt Value Position 31/12/14 GH¢

Position 31/12/15 No. of Sh.

Mkt Value Position 31/12/15 GH¢

(Sales)/ Purchases During Yr

Capital Gain (Loss) GH¢

ALW

61,745

1,235

61,745

8,644

-

7,409

Equity

CAL

60,094

60,695

60,094

60,094

-

(601)

EBG

77,338

587,769

60,549

424,449

(127,596)

(35,724)

EGL

67,055

117,346

67,055

160,932

-

43,586

ETI

109,050

30,534

116,320

31,406

-

872

FML

43,470

228,217

43,470

319,504

-

91,288

GCB

139,422

738,937

139,422

528,409

-

(210,528)

GOIL

186,000

195,300

186,000

260,400

-

65,100

PZ

61,812

18,543

61,812

21,016

-

2,473

SCB

15,096

307,204

15,096

246,064

-

(61,139)

SG-SSB

58,144

58,144

63,958

51,167

-

(6,978)

113,500

41,995

113,500

15,890

-

(26,105)

20,800

126,880

20,800

106,080

-

(20,800)

400

4,280

400

3,400

-

(880)

1,013,926

2,517,079

1,010,221

2,237,456

(127,596)

152,026

(1,710,179)

(1,463,811)

806,900

773,645

SIC TOTAL UNIL At Market

Gain/(Loss) Reserve At Cost

REPORTS AND FINANCIAL STATEMENTS

Balance on Unrealized

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SAS FORTUNE FUND LIMITED NOTES TO THE FINANCIAL STATEMENTS AS AT DECEMBER 31, 2015 1. Accounting Policies

The following is a summary of accounting policies consistently followed by the Fund in the preparation of its financial statements. The preparation of the Financial Statements is in conformity with generally accepted accounting principles. a) Securities Valuation Securities listed on the Ghana Stock Exchange are valued at the last quoted official market price at the end of the year. Unlisted securities are valued at the average of the latest bid and offer prices. Fixed-income securities are valued at the historical cost plus accrued interest. Where market prices are not readily available or the values as determined are not considered to represent true market values, a fair value is determined by the Manager under the direction of the Board of Directors of the Fund. b) Security Transactions Security transactions are recorded on a trade date basis. Realized Capital Gains and Losses are determined on an identified cost basis. c) Income Interest income is recognized on an accrual basis. Dividend Income is recorded if the qualifying date falls within the year under review. Other income is recorded when received rather than earned. d) Foreign Exchange The financial statements have been prepared using the Ghana Cedi as the functional currency. All foreign currency transactions are converted into Ghana Cedis at the rate of exchange ruling at the date of the transaction. Balances denominated in foreign currencies are translated into Ghana Cedis at the rate of Exchange ruling on the Balance Sheet date.

REPORTS AND FINANCIAL STATEMENTS

2. Interest Income

Interest on Call Deposit Interest on fixed Deposit

22

2015 GH¢

2014 GH¢

-

849

171,349

161,991

171,349

162,840

SAS FORTUNE FUND LIMITED NOTES TO THE FINANCIAL STATEMENTS AS AT DECEMBER 31, 2015 2015 GH¢

2014 GH¢

3. Other Income Sundry Income Exit Charges (Refer to Note 11)

11,358 7,856

12,097

19,214

12,097

Advertising

1,337

906

Custodian Fees

6,981

7,300

Audit Fee

9,000

7,000

4. Other Expenses

Secretarial Fees

2,585

2,350

AGM Expenses

17,076

14,153

Postage

-

2,349

36,979

34,058

Proceeds from Sale of Investment (Shares)

136,360

-

Average Costs of Investment (Shares) Sold

(33,255)

-

Transfer from Unrealised Gain/ (Loss)

(94,341)

-

876

-

5. Realised Gain on Investments

6. Redemptions/Withdrawals

REPORTS AND FINANCIAL STATEMENTS

Consideration Gain/(Loss) Cost to Paid to Reserves Capital 2015 596,956 (198,109) 396,846 ====== ======= ====== 2014 696,212 (217,333) 478,879 ====== ====== ======

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SAS FORTUNE FUND LIMITED NOTES TO THE FINANCIAL STATEMENTS AS AT DECEMBER 31, 2015 2015 GH¢

2014 GH¢

1,710,179

1,439,446

(152,026)

270,733

(94,341)

-

1,463,812

1,710,179

7. Unrealized Gain/ (Loss) Reserve (Memorandum only) Balance at January 1st Unrealized Gain / (Loss) for the Year Charged to Income & Distribution A/c Realized Gain on Sale of Investment Transferred to Realized Gain Balance at December 31 8. Capital Accounts

Balance at January 1st Issue of Shares Redemption of Shares Balance At December 31st

2015 No. of Shares

2015 GH¢

2014 No. of Shares

2014 GH¢

6,249,518

1,430,166

6,030,322

1,133,226

724,580

367,712

1,699,396

775,819

(1,140,207)

(396,847)

(1,480,200)

(478,879)

5,833,891

1,401,031

6,249,518

1,430,166

9. Taxation Under current Ghanaian legislation, mutual funds are not subject to taxes on income or capital gains. However, the required taxes are paid for investments done in jurisdictions where taxes on income or gains on investments apply. 10. Investment Transactions REPORTS AND FINANCIAL STATEMENTS

Total sale of investments in quoted equity was GH¢136,360. (2014: Nil).

24

SAS FORTUNE FUND LIMITED NOTES TO THE FINANCIAL STATEMENTS AS AT DECEMBER 31, 2015 11. Redemption/ Exit Fees

The Fund is a long-term growth fund and its objective is to encourage shareholders to remain in the fund for at least three (3) years. The following withdrawal charges apply when investors redeem all or part of their shares within the first three (3) years. REDEMPTION WITHIN YEAR(S)

CHARGES

1

3%

2

2%

3

1%

3+

None

12. Transactions through Affiliates

The entire Fund’s equity transactions were done through Strategic African Securities Limited, a company related to SAS Investment Management Limited, the Manager of the Mutual Fund. 13. Commissions and Levies

Total Commissions and Stock Exchange Levies was Nil (2014 Nil). 14. Comparative Figures

REPORTS AND FINANCIAL STATEMENTS

Aspects of the presentation relating to the prior year have been restated to make them comparable to the current year presentatio

25

SAS FORTUNE FUND LIMITED NOTES TO THE FINANCIAL STATEMENTS AS AT DECEMBER 31, 2015 2015 GH¢

2014 GH¢

Others

8,852

394

8% Investment Tax Withheld

7006

7006

SCHEDULES

A. RECEIVABLES

Accounts Receivable – SASIM

3,639

3,639

19,497

11,039

B. LIABILITIES Accrued Expenses Payable Custody Fees

1,190

-

Secretarial Fees

7,099

587

Audit Fees

9,000

7,000

17,289

7,587

Directors’ Fees Accrued

-

16,660

Outstanding Redemptions

-

-

-

16,660

REPORTS AND FINANCIAL STATEMENTS

Others

26

27

REPORTS AND FINANCIAL STATEMENTS

28

REPORTS AND FINANCIAL STATEMENTS

SAS FORTUNE FUND LIMITED DIRECTORS AND OFFICERS INFORMATION

The business and affairs of the Fund are managed by the Fund Manager under the direction of the Fund’s Board of Directors and the Fund’s officers. The table below lists the directors and officers of the Fund and their principal occupations, other directorships and their affiliations. Name, Address

Position

Time with Fund

Occupation

Other Affiliates

Maxwell Logan (48) Plot.5 & 8, Tabon Street Sedco House Annexe North-Ridge, Accra

Director

Since Inception (June 2004)

Legal Practitioner

Logan and Associates Office Support Project New Beach Realtors Ltd.

Nana Soglo Allo IV (56) No. 44 Nii Bonnie St

Director

August 2013

Legal Practioner

Alloh & Partners P. O. Box NT 478

Independent Directors

Dzorwulu Director

August 2013

Banker

Greenfield Microfinance P.O Box DS 864 Accra

Interested Directors Togbe Afede XIV (57) P.O Box KA 16446 Accra

Director

Apiigy Afenu (56) M7 Manet Cottage Spintex Road Baatsona

Director

Since Inception (June 2004)

Investment

November 2009

Chartered

Banker

Accountant

Strategic African Securities SASIM Strategic Initiatives Aluworks (Gh) Ltd Procredit National Theatre Bank of Ghana Accra Hearts of Oak SAPP Strategic African Securities Africa World Airline Accra Hearts of Oak

REPORTS AND FINANCIAL STATEMENTS

Paul Hammond (63) M65 Jam Close Community 20 Tema

Accra

29

SAS FORTUNE FUND LIMITED PROXY FORM

I/We………………………………………. of …………………………………………….......... being a Shareholder of the above-named Company hereby appoint …………………………………………….. of …………………………………………….......... or failing him…………………………………………….. of…………………………………… as my/our Proxy to vote for me/us and on my/our behalf at the 11th Annual General Meeting of the Shareholders to be held on Thursday August 4, 2016 at the College of Physicians and Surgeons, Ridge, Accra or at any adjournment thereof. I/ We direct that my/our vote(s) be cast on the specified resolution as indicated by an X in the appropriate space. RESOLUTIONS 1. To receive and adopt the Financial Statements of the Fund for the year ended December 31, 2015 and the Reports of the Directors and Auditors thereon. 2. To re-elect Directors retiring by rotation: Mr. Maxwell Logan Mr. Apiigy Afenu 3. To approve Directors’ remuneration

REPORTS AND FINANCIAL STATEMENTS

4. To authorize the Directors to fix the remuneration of the Auditors.

.……………………………………….. Shareholder’s Signature

30

FOR

AGAINST

Kindly visit our CLIENT SERVICE CENTRE at the ground oor of the Convention Centre (World Trade Centre, Accra) for all;

ENQUIRIES, REDEMPTIONS, CHEQUE COLLECTION & DEPOSITS for INVESTMENTS.

14th Floor, World Trade Centre, Independaence Avenue, Accra P.O. Box KA 16446, Accra, Ghana t. +233 302 661770/ 661900/ 661008 f. +233 302 663999 e. [email protected] www.facebook.com/sasfinance www.twitter.com/sasfinance