FINANCIAL STATEMENTS Investment Funds – December 31, 2019 Table of Contents
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FINANCIAL STATEMENTS Investment Funds – December 31, 2019 Table of Contents Independent Auditor's Report 1 Assumption Growth Portfolio 5 Assumption Balanced Growth Portfolio 7 Assumption Balanced Portfolio 9 Assumption Conservative Portfolio 11 Assumption SmartSeries Income Fund 13 Assumption SmartSeries 2020 Fund 15 Assumption SmartSeries 2025 Fund 17 Assumption SmartSeries 2030 Fund 19 Assumption SmartSeries 2035 Fund 21 Assumption SmartSeries 2040 Fund 23 Assumption SmartSeries 2045 Fund 25 Assumption SmartSeries 2050 Fund 27 Assumption SmartSeries 2055 Fund 29 Assumption/Louisbourg Balanced Fund 31 Assumption/Louisbourg U.S. Equity Fund 33 Assumption/Louisbourg Canadian Dividend Fund 34 Assumption/Louisbourg Fixed Income Fund 35 Assumption/Louisbourg Money Market Fund 36 Assumption/Louisbourg Canadian Small Capitalization Equity Fund 37 Assumption/Louisbourg Momentum Fund 38 Assumption/Louisbourg Preferred Share Fund 39 Assumption/Fidelity True North® Fund 40 Assumption/Fidelity International Growth Fund 41 Assumption/Fidelity Canadian Opportunities Fund 42 Assumption/Fidelity Europe Fund 43 Assumption/Fidelity Canadian Asset Allocation Fund 44 Assumption/Fidelity Monthly Income Fund 45 Assumption/Fidelity American Disciplined Equity® Fund 46 Assumption/Fidelity North Star® Fund 47 Assumption/Fidelity Far East Fund 48 Assumption/Fidelity Emerging Markets Fund 49 Assumption/Fidelity NorthStar® Balanced Fund 50 Assumption/CI Signature Canadian Bond Fund 51 Assumption/CI Harbour Growth & Income Fund 52 Assumption/CI Signature High Income Fund 53 Assumption/CI American Value Fund 54 Assumption/CI Global Small Companies Fund 55 Assumption/CI Cambridge Canadian Asset Allocation Fund 56 Assumption/CI Signature Corporate Bond Fund 57 Assumption/CI Cambridge Canadian Dividend Fund 58 Assumption/CI Signature Global Resource Corporate Class Fund 59 Assumption/CI Signature Global Dividend Fund 60 Notes to Audited Financial Statements 61 Financial Highlights Unaudited 65 INDEPENDENT AUDITOR’S REPORT To the contractholders of the following Assumption Life Investment Funds: Assumption Growth Portfolio Assumption/Fidelity True North® Fund Assumption Balanced Growth Portfolio Assumption/Fidelity International Growth Fund Assumption Balanced Portfolio Assumption/Fidelity Canadian Opportunities Fund Assumption Conservative Portfolio Assumption/Fidelity Europe Fund Assumption SmartSeries Income Fund Assumption/Fidelity Canadian Asset Allocation Fund Assumption SmartSeries 2020 Fund Assumption/Fidelity Monthly Income Fund Assumption SmartSeries 2025 Fund Assumption/Fidelity American Disciplined Equity® Fund Assumption SmartSeries 2030 Fund Assumption/Fidelity North Star® Fund Assumption SmartSeries 2035 Fund Assumption/Fidelity Far East Fund Assumption SmartSeries 2040 Fund Assumption/Fidelity Emerging Markets Fund Assumption SmartSeries 2045 Fund Assumption/Fidelity NorthStar® Balanced Fund Assumption SmartSeries 2050 Fund Assumption/CI Signature Canadian Bond Fund Assumption SmartSeries 2055 Fund Assumption/CI Harbour Growth & Income Fund Assumption/Louisbourg Balanced Fund Assumption/CI Signature High Income Fund Assumption/Louisbourg U.S. Equity Fund Assumption/CI American Value Fund Assumption/Louisbourg Canadian Dividend Fund Assumption/CI Global Small Companies Fund Assumption/Louisbourg Fixed Income Fund Assumption/CI Cambridge Canadian Asset Allocation Fund Assumption/Louisbourg Money Market Fund Assumption/CI Signature Corporate Bond Fund Assumption/Louisbourg Canadian Small Assumption/CI Cambridge Canadian Dividend Fund Capitalization Equity Fund Assumption/CI Global Resource Corporate Class Fund Assumption/Louisbourg Momentum Fund Assumption/CI Signature Global Dividend Fund Assumption/Louisbourg Preferred Share Fund [collectively named the «Funds»] A member firm of Ernst & Young Global Limited Opinion We have audited the financial statements of the Funds, which comprise the statement of financial position as at December 31, 2019, and the statement of comprehensive income, statement of changes in net assets and statement of cash flows for the year then ended, and a schedule of investment portfolio as at December 31, 2019, and notes to the financial statements, including a summary of significant accounting policies. In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Funds as at December 31, 2019, and their financial performance and their cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRSs). Basis for Opinion We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Funds in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Other information Management is responsible for the other information. The other information comprises the Financial Highlights of the Funds. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information, and in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. We obtained the Financial Highlights of the Funds prior to the date of this auditor’s report. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact in this auditor’s report. We have nothing to report in this regard. Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with IFRSs, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the Funds’ ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Funds or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Funds’ financial reporting process. A member firm of Ernst & Young Global Limited Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit 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. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Funds’ ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Funds to cease to