E FUND INVESTMENT FUND SERIES

REPORTS AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2015

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND

(Sub-funds of E Fund Investment Fund Series)

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

REPORTS AND FINANCIAL STATEMENTS

Contents Pages

Management and administration ...... 1

Report of the Manager ...... 2 - 3

Report of the Trustee ...... 4

Independent Auditor’s Report ...... 5 - 6

Statement of Financial Position ...... 7

Statement of Comprehensive Income ...... 8

Statement of Changes in Net Assets Attributable to Unitholders...... 9

Statement of Cash Flows ...... 10

Notes to the Financial Statements ...... 11 – 49

E Fund RMB Fixed Income Fund - Investment Portfolio (Unaudited) ...... 50 – 51 - Statement of Movement in Investment Portfolio (Unaudited) ...... 52 – 55 - Performance Table (Unaudited) ...... 56

E Fund RMB Mainland China Bond Fund - Investment Portfolio (Unaudited) ...... 57 – 58 - Statement of Movement in Investment Portfolio (Unaudited) ...... 59 – 61 - Performance Table (Unaudited) ...... 62

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

MANAGEMENT AND ADMINISTRATION

Manager and RQFII Holder Directors of the Manager E Fund Management (Hong Kong) Co., Limited Liu Xiaoyan Suites 3501-02, 35/F Zhang Youzao Two International Finance Centre Fan Yue 8 Finance Street Ma Jun Central Hong Kong

Trustee and Registrar Bank of Communications Trustee Limited 1/F, Far East Consortium Building 121 Des Voeux Road Central Hong Kong

PRC Custodian Bank of Communications Co., Ltd. 188 Yin Cheng Zhong Road Shanghai 200120 The People's Republic of China

Legal Counsel to the Manager Deacons 5/F, Alexandra House 18 Chater Road Central Hong Kong

Auditor PricewaterhouseCoopers 21/F, Edinburgh Tower 15 Queen’s Road Central Hong Kong

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E FUND RMB FIXED INCOME FUND (A sub-fund of E Fund Investment Fund Series)

REPORT OF THE MANAGER TO THE UNITHOLDERS

Introduction

E Fund RMB Fixed Income Fund is a sub-fund of E Fund Investment Fund Series. The inception day of the Fund was on 18 January 2012. The manager of the E Fund RMB Fixed Income Fund is E Fund Management (Hong Kong) Co., Ltd. and the trustee is Bank of Communications Trustee Limited.

Fund Performance

E Fund RMB Fixed Income Fund seeks to achieve long term capital growth in RMB terms through investment in a portfolio consisting primarily of RMB denominated and settled fixed income debt instruments issued or distributed within China which aim to generate a steady flow of income in addition to capital appreciation for the Sub-Fund. As of 31 December 2015, the Net Asset Value per unit of the RMB Fixed Income Fund for Class A RMB (distribution) and Class I RMB (distribution) was RMB 112.82 and RMB 115.24 respectively. The total size of the fund was approximately RMB 886 million.

As of 31 December 2015, a summary of the performance of the RMB Fixed Income Fund is given below.

Cumulative Performance in RMB* Since Launch1 1 Month 3 Months 6 Months 1 Year Class A RMB (Dis) 33.1% 2.1% 4.0% 4.7% 13.2% Class I RMB (Dis) 35.7% 2.1% 4.2% 5.0% 13.8%

Calendar Year Cumulative Performance in RMB* 2015 2014 2013 2012 Class A RMB (Dis) 13.2% 12.1% -0.1% - Class I RMB (Dis) 13.8% 12.6% 0.4% -

Source: Bloomberg *NAV-to-NAV return, total return with dividend (if any) reinvested 1 The total return for the period from its inception date to 31 December 2015

Note: Past performance information is not indicative of future performance. Investors may not get back the full amount invested. The computation basis of the performance is based on the calendar year end, NAV-To- NAV, with dividend reinvested.

These figures show by how much the E Fund RMB Fixed Income Fund /Class A and Class I increased or decreased in value during the calendar year being shown. Performance data has been calculated in RMB, including ongoing charges and excluding subscription fee and redemption fee you might have to pay. Where no past performance is shown there was insufficient data available in that year to provide performance.

The top 5 holdings are as below.

Top 5 Holdings (% of Total NAV) HNEXPR VAR 03/07/26 7.52% BJKYCI 7.78 02/25/21 6.61% SASCWX 5.68 05/18/25 6.47% DALTIN 7.00 08/08/21 6.42% CFDEVL 7.07 06/19/21 6.37%

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E FUND RMB MAINLAND CHINA BOND FUND (A sub-fund of E Fund Investment Fund Series)

REPORT OF THE MANAGER TO THE UNITHOLDERS (CONTINUED)

Introduction

E Fund RMB Mainland China Bond Fund is a sub-fund of E Fund Investment Fund Series. The Fund was launched on 22 August 2013. The manager of the E Fund RMB Mainland China Bond Fund is E Fund Management (Hong Kong) Co., Ltd. and the trustee is Bank of Communications Trustee Limited.

Fund Performance

E Fund RMB Mainland China Bond Fund seeks to achieve long term capital growth in RMB terms through investment in a portfolio consisting primarily of RMB denominated and settled fixed income debt instruments issued or distributed within China which aim to generate a steady flow of income in addition to capital appreciation for the Sub-Fund. As of 31 December 2015, the Net Asset Value per unit of the RMB Mainland China Bond Fund for Class A RMB (accumulation) and Class I RMB (accumulation) was RMB 108.87 and RMB 110.14 respectively. The total size of the fund was approximately RMB 908 million.

As of 31 December 2015, a summary of the performance of the E Fund RMB Mainland China Bond Fund is given below.

Cumulative Performance in RMB* Since Launch1 1 Month 3 Months 6 Months 1 Year Class A RMB (Acc) 8.9% 1.1% 1.7% 2.9% 5.6% Class I RMB (Acc) 10.1% 1.1% 1.8% 3.2% 6.1%

Calendar Year Cumulative Performance in RMB* 2015 2014 2013 Class A RMB (Acc) 5.6% 4.5% - Class I RMB (Acc) 6.1% 5.0% -

Source: Bloomberg *NAV-to-NAV return, total return with dividend (if any) reinvested 1 The total return for the period from its launch date to 31 December 2015

Note: Past performance information is not indicative of future performance. Investors may not get back the full amount invested. The computation basis of the performance is based on the calendar year end, NAV-To- NAV, with dividend reinvested.

These figures show by how much the E Fund RMB Mainland China Bond Fund /Class A and Class I increased or decreased in value during the calendar year being shown. Performance data has been calculated in RMB, including ongoing charges and excluding subscription fee and redemption fee you might have to pay.

Where no past performance is shown there was insufficient data available in that year to provide performance.

The top 5 holdings are as below.

Top 5 Holdings (% of Total NAV) CNPCCH 4.47 02/22/18 5.90% CNGC 5.05 09/15/17 5.78% CHNNUC 2.96 09/06/16 5.30% TSURBN 7.10 02/26/21 5.13% SBSG 3.18 10/26/16 4.99%

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E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

REPORT OF THE TRUSTEE

TO THE UNITHOLDERS OF E FUND INVESTMENT FUND SERIES (THE “TRUST FUND”)

We hereby confirm that, in our opinion, the Manager has, in all material respects, managed the Trust Fund in accordance with the provisions of the Trust Deed dated 18 January 2012 and all its supplemental deeds for the year ended 31 December 2015.

For and on behalf of Bank of Communications Trustee Limited 27 April 2016

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INDEPENDENT AUDITOR’S REPORT TO THE UNITHOLDERS OF E FUND RMB FIXED INCOME FUND AND E FUND RMB MAINLAND CHINA BOND FUND (THE “SUB-FUNDS”) (Sub-funds of E Fund Investment Fund Series)

Report on the Financial Statements

We have audited the financial statements of E Fund RMB Fixed Income Fund and E Fund RMB Mainland China Bond Fund (the “Sub-Funds”), each a separate sub-fund of E Fund Investment Fund Series (the “Trust”) set out on pages 7 to 49, which comprise the statement of financial position as at 31 December 2015, and the statements of comprehensive income, statements of changes in net assets attributable to unitholders and statements of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

The Trustee and the Manager (the “Management”) of the Sub-Funds are responsible for the preparation of financial statements that give a true and fair view in accordance with International Financial Reporting Standards, and are responsible for ensuring that the financial statements have been properly prepared in accordance with the relevant disclosure provisions of the Trust Deed dated 18 January 2012, as amended (the “Trust Deed”), and Appendix E of the Code on Unit Trusts and Mutual Funds issued by the Securities and Futures Commission of Hong Kong (the “SFC Code”), and for such internal control as the Management 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. 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. We are also required to assess whether the financial statements of the Sub-Funds have been properly prepared, in all material respects, in accordance with the relevant disclosure provisions of the Trust Deed and the SFC Code.

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 judgment, 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 Sub-Funds’ preparation of financial statements that give a true and fair view 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 Sub- Funds’ internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Management, as well as evaluating the overall 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.

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INDEPENDENT AUDITOR’S REPORT TO THE UNITHOLDERS OF E FUND RMB FIXED INCOME FUND AND E FUND RMB MAINLAND CHINA BOND FUND (THE “SUB-FUNDS”) (CONTINUED) (Sub-funds of E Fund Investment Fund Series)

Opinion

In our opinion, the financial statements give a true and fair view of the financial position of each of the Sub-Funds as at 31 December 2015, and of each of their financial transactions and cash flows for the year then ended in accordance with International Financial Reporting Standards.

Other Matters

This report, including the opinion, has been prepared for and only for you, as a body, and for no other purpose. We do not assume responsibility towards or accept liability to any other person for the contents of this report.

Report on Other Legal and Regulatory Requirements

In our opinion, the financial statements have been properly prepared, in all material respects, in accordance with the relevant disclosure provisions of the Trust Deed and the SFC Code.

PricewaterhouseCoopers Certified Public Accountants

Hong Kong, 27 April 2016

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E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2015

E Fund RMB E Fund RMB Fixed Income Fund Mainland China Bond Fund Note 2015 2014 2015 2014 RMB RMB RMB RMB Non-Current Assets Deposit reserve 244,784 231,808 231,375 226,465

Current Assets Investments 4(a), 4(d), 8(d) 860,453,551 757,684,628 886,551,900 807,592,294 Interest receivable 23,937,881 26,373,850 19,707,554 22,626,765 Amount due from brokers - - - 10,206,535 Subscription receivable 11,559 215,883,678 - - Cash and cash equivalents 4(d), 8(d) 6,898,996 65,857,789 4,875,937 19,434,437 ────────── ────────── ────────── ────────── Total assets 891,546,771 1,066,031,753 911,366,766 860,086,496 ------Non-Current Liabilities Deferred tax liability 9 - 1,422,606 - 190,188

Current Liabilities Management fee payable 8(a) 475,729 492,510 388,725 362,329 Trustee fee payable 8(b) 83,725 80,932 85,290 79,582 Custodian fee payable 8(c) 60,891 58,860 62,029 57,878 Redemption payable 3,633,604 217,930,969 - - Provision for tax 9 4,919,746 12,164,276 2,314,764 3,149,256 Accrued expenses and other payables 459,437 477,679 345,119 335,835 ────────── ────────── ────────── ────────── Total liabilities (excluding net assets attributable to unitholders) 9,633,132 232,627,832 3,195,927 4,175,068 ------

Net assets attributable to unitholders (after amortisation of establishment costs) 7 881,913,639 833,403,921 908,170,839 855,911,428 ══════════ ═ ═══════════ ═══════════ ═══════════ Represented by: Net assets attributable to unitholders (before amortisation of establishment costs) 882,273,172 834,072,230 908,389,843 856,214,145

Adjustment for different basis adopted by the Sub-Funds in arriving at net assets attributable to unitholders 7 (359,533) (668,309) (219,004) (302,717) ══════════ ═ ═══════════ ═══════════ ═══════════

Approved by the Trustee and the Manager on 27 April 2016.

………………………….... ………………………….... For and on behalf of For and on behalf of Bank of Communications Trustee Limited E Fund Management (Hong Kong) Co., Limited As the Trustee As the Manager - 7 -

The notes on pages 11 to 49 form an integral part of these financial statements.

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E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2015

E Fund RMB Fixed E Fund RMB Mainland Income Fund China Bond Fund Note 2015 2014 2015 2014 RMB RMB RMB RMB

Income Interest income 51,300,157 54,723,113 43,299,365 51,354,306 Dividend income 402,205 447,272 - - Net gain on investments 6 70,669,432 57,295,922 16,369,478 5,402,564 Net foreign exchange gains/(losses) (461,095) 2,512 29,362 (50,387) Other income 8(g) - - - 367,545 ───────── ───────── ───────── ───────── Total investment income 121,910,699 112,468,819 59,698,205 57,074,028 ------Expenses Management fee 8(a) 6,137,714 6,680,441 4,568,844 4,921,369 Trustee fee 8(b) 1,075,634 957,485 1,003,029 1,079,985 Custodian fee 8(c) 782,279 730,714 729,476 816,535 Auditor’s remuneration 215,456 203,058 215,455 187,920 Transaction costs 1,523,659 870,861 278,593 312,611 Legal and professional fees 621,797 115,752 183,246 166,365 Other operating expenses 439,372 560,609 163,967 429,764 ───────── ───────── ───────── ───────── Total operating expenses 10,795,911 10,118,920 7,142,610 7,914,549 ------

Profit before tax 111,114,788 102,349,899 52,555,595 49,159,479

Add/less: Taxation 9 8,313,058 (4,656,950) 995,038 (1,015,265) ───────── ───────── ───────── ───────── Profit after tax 119,427,846 97,692,949 53,550,633 48,144,214

Less: Distribution to unitholders 12 (68,432,363) (38,251,124) (68,901) (285,913) ───────── ───────── ───────── ───────── Profit after distribution and after tax 50,995,483 59,441,825 53,481,732 47,858,301

Adjustment for different basis adopted by the Sub-Funds in arriving at net assets attributable to unitholders 7 (308,776) (308,776) (83,713) (71,003) ───────── ───────── ───────── ───────── Increase in net assets attributable to unitholders from operations 50,686,707 59,133,049 53,398,019 47,787,298 ═════════ ══════════ ═════════ ═════════

The notes on pages 11 to 49 form an integral part of these financial statements. - 9 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO UNITHOLDERS FOR THE YEAR ENDED 31 DECEMBER 2015

E Fund RMB Fixed E Fund RMB Mainland Income Fund China Bond Fund Note 2015 2014 2015 2014 RMB RMB RMB RMB

Net assets attributable to unitholders at the beginning of the year 834,072,230 1,125,395,632 856,214,145 955,860,002 ------

Proceeds on issue of units 864,797,764 681,351,709 116,973,105 1,069,707,375

Payments on redemption of units (867,283,529) (1,031,808,160) (118,195,426) (1,217,140,530) ─────────── ─────────── ─────────── ─────────── Net decrease from unit transactions (2,485,765) (350,456,451) (1,222,321) (147,433,155) ------

Increase in net assets attributable to unitholders from operations 50,686,707 59,133,049 53,398,019 47,787,298 ------

Net assets attributable to unitholders at the end of the year (before amortisation of establishment costs) 7 882,273,172 834,072,230 908,389,843 856,214,145 ══════════ ══════════ ══════════ ══════════

The notes on pages 11 to 49 form an integral part of these financial statements. - 10 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2015

E Fund RMB E Fund RMB Fixed Income Fund Mainland China Bond Fund Note 2015 2014 2015 2014 RMB RMB RMB RMB

Cash flows from operating activities Cash generated from/(used in) operations 10 (84,872,105) 338,995,533 (78,043,111) 60,502,846

Interest received 95,208,559 96,608,258 64,805,475 99,493,876 Dividend received 402,205 447,272 - - Tax paid (354,078) (92,010) (29,642) (17,810) ─────────── ────────── ─────────── ─────────── Net cash inflow/(outflow) from operating activities 10,384,581 435,959,053 (13,267,278) 159,978,912 ------Financing activities Proceeds from units issued 1,080,669,883 465,468,031 116,973,105 1,069,707,375 Payments on units redeemed (1,081,580,894) (825,376,561) (118,195,426) (1,217,140,530) Distribution paid to unitholders (68,432,363) (38,251,124) (68,901) (285,913) ─────────── ────────── ─────────── ─────────── Net cash outflow from financing activities (69,343,374) (398,159,654) (1,291,222) (147,719,068) ------

Net (decrease)/increase in cash and cash equivalents (58,958,793) 37,799,399 (14,558,500) 12,259,844

Cash and cash equivalents at the beginning of the year 65,857,789 28,058,390 19,434,437 7,174,593 ─────────── ────────── ─────────── ─────────── Cash and cash equivalents at the end of the year 6,898,996 65,857,789 4,875,937 19,434,437 ═══════════ ══════════ ═══════════ ═══════════

Analysis of balances of cash and cash equivalents Bank balances 6,898,996 65,857,789 4,875,937 19,434,437 ═══════════ ══════════ ═══════════ ══════════

The notes on pages 11 to 49 form an integral part of these financial statements. - 11 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

1 General information

E Fund Investment Fund Series (the “Trust”) is an umbrella unit trust governed by its Trust Deed dated 18 January 2012, as amended (the “Trust Deed”) made between E Fund Management (Hong Kong) Co., Limited as the Manager (the “Manager”) and Bank of Communications Trustee Limited as the Trustee (the “Trustee”). The terms of the Trust Deed are governed by the law of Hong Kong. The Trust is authorised by the Securities and Futures Commission of Hong Kong (the “SFC”) under 104(1) of the Hong Kong Securities and Futures Ordinance. As at 31 December 2015, the Trust has two sub-funds, namely E Fund RMB Fixed Income Fund and E Fund RMB Mainland China Bond Fund (the “Sub-Funds”), in respect of which separate classes of units were issued. The date of inception of E Fund RMB Fixed Income Fund was 18 January 2012 and the date of inception of E Fund RMB Mainland China Bond Fund was 19 April 2013.

The Sub-Funds seek to provide investors with long-term capital growth in Renminbi (“RMB”) terms by investing primarily in a managed portfolio of debt securities and money market instruments denominated and settled in RMB issued or listed in the People’s Republic of China (“PRC”), including but not limited to fixed rate or floating rate debt securities, convertible bonds, commercial papers and certificates of deposit. These instruments may be traded or dealt in the mainland exchange market or interbank bond market (OTC market). These instruments may be issued by the Chinese governments (including municipal bonds issued by local governments), quasi-government organisations, banks, financial institutions and other corporate entities. The Sub-Funds may also invest in collective investment schemes which primarily invest in fixed income securities, including exchange traded funds.

Investment in debt securities, money market instruments and the abovementioned collective investment schemes shall be no less than 80% of the net asset value of the Sub-Funds.

The Sub-Funds may invest up to 10% of its total Net Asset Value in asset backed securities.

The Sub-Funds may also invest up to 20% of its net asset value in China A-Shares listed on the Shanghai and Shenzhen Stock Exchanges (including initial public offerings) and collective investment schemes which primarily invest in equity securities, including exchange traded funds, issued or listed in the PRC.

The Sub-Funds will only invest in collective investment schemes that have been authorised by the China Securities Regulatory Commission (“CSRC”) for investment by the retail public, and such investment will not in aggregate exceed 10% of the Net Asset Value.

Exposure to securities issued within mainland China will be through the RQFII quotas of the Manager. The Sub-Funds will not invest in derivative instruments, structured products or structured deposits for hedging or non-hedging purposes.

For E Fund RMB Fixed Income Fund, with effect from 11 December 2015, the investment objective and policy has been revised that the Sub-Fund may also invest in fixed income funds and/or equity funds which are issued and offered outside Mainland China. The aggregate investments in fixed income funds and equity funds (whether authorised by the CSRC for offer to the retail public in Mainland China or issued and offered outside Mainland China) will be up to 10% of the Net Asset Value of the Sub-Fund.

For E Fund RMB Mainland China Bond Fund, the Sub-Fund will not invest in any RMB denominated debt instruments outside mainland China.

The Manager has obtained RQFII status in the PRC and the RQFII quotas have been granted to the Manager on behalf of the Sub-Funds. To the extent that the Manager has, on behalf of the Sub- Funds, utilised its entire RQFII quota, the Manager may, subject to any applicable regulations, apply for an increase of the RQFII quota. On the other hand, the Manager actively manages the RQFII quota obtained and may impose limits on creation applications as it considers appropriate.

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E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

2 Summary of significant accounting policies

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to the period presented, unless otherwise stated.

(a) Basis of preparation

The financial statements of the Sub-Funds have been prepared in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”). The financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets held at fair value through profit or loss.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires the Trustee and the Manager to exercise their judgment in the process of applying the Sub-Funds’ accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in note 3.

(i) Standards and amendments to existing standards effective 1 January 2015

There are no standards, interpretations or amendments to existing standards that are effective for the first time for the financial year beginning 1 January 2015 that have had a material impact on the Sub-Funds.

(ii) New standards and amendments to standards that are relevant to the Sub-Funds but are not yet effective and have not been early adopted by the Sub-Funds

A number of new standards, amendments to standards and interpretations are effective for annual periods beginning after 1 January 2015, and have not been applied in preparing these financial statements. None of these are expected to have a significant effect on the financial statements of the Sub-Funds except the following set out below:

IFRS 9, ‘Financial instruments’, addresses the classification, measurement and recognition of financial assets and financial liabilities. The complete version of IFRS 9 was issued in July 2014. It replaces the guidance in IAS 39 that relates to the classification and measurement of financial instruments. IFRS 9 retains but simplifies the mixed measurement model and establishes three primary measurement categories for financial assets: amortised cost, fair value through OCI and fair value through P&L. The basis of classification depends on the entity's business model and the contractual cash flow characteristics of the financial asset. Investments in equity instruments are required to be measured at fair value through profit or loss with the irrevocable option at inception to present changes in fair value in OCI not recycling. There is now a new expected credit losses model that replaces the incurred loss impairment model used in IAS 39. For financial liabilities there were no changes to classification and measurement except for the recognition of changes in own credit risk in other comprehensive income, for liabilities designated at fair value through profit or loss. IFRS 9 relaxes the requirements for hedge effectiveness by replacing the bright line hedge effectiveness tests. It requires an economic relationship between the hedged item and hedging instrument and for the ‘hedged ratio’ to be the same as the one management actually use for risk management purposes.

Contemporaneous documentation is still required but is different to that currently prepared under IAS 39. The standard is effective for accounting periods beginning on or after 1 January 2018. Early adoption is permitted. The Manager is yet to assess IFRS 9’s full impact. - 13 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

2 Summary of significant accounting policies (Continued)

(a) Basis of preparation (Continued)

(ii) New standards and amendments to standards that are relevant to the Sub-Funds but are not yet effective and have not been early adopted by the Sub-Funds (Continued)

There are no other IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the Sub-Funds.

(b) Investments

(i) Classification

The Sub-Funds classify their investments as financial assets at fair value through profit or loss. These financial assets are designated by the Management at fair value through profit or loss at inception. Financial assets designated at fair value through profit or loss at inception are those that are managed and their performance evaluated on a fair value basis in accordance with the Sub-Funds’ documented investment strategies. The Sub-Funds’ policies require the Management to evaluate the information about these financial assets on a fair value basis together with other related financial information.

(ii) Recognition/derecognition

Purchases and sales of investments are accounted for on a trade date basis. Investments are derecognised when the rights to receive cash flows from the investments have expired or the Sub-Funds have transferred substantially all risks and rewards of ownership.

(iii) Measurement

Investments are initially recognised at fair value. Transaction costs are expensed in the statement of comprehensive income.

Subsequent to initial recognition, all investments are measured at fair value. Realised and unrealised gains and losses on investments are recognised in the statement of comprehensive income in the period in which they arise.

(iv) Fair value estimation

The following represent the basis of valuation for financial reporting purposes:

(i) Investments that are listed or traded on an exchange are fair valued based on quoted market prices at close of trading on reporting date.

(ii) Investments which are traded in the interbank markets (for example, unlisted debt securities) are fair valued by using the valuation provided by China Central Depository & Clearing Co., Ltd., a company jointly established by People’s Bank of China and Ministry of Finance to undertake the function of centralised depository and settlement for the interbank bond market.

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E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

2 Summary of significant accounting policies (Continued)

(c) Income and expenses

Interest income is recognised on a time-proportionate basis using the effective interest method.

The effective interest method is a method of calculating the amortised cost of an interest bearing asset and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts throughout the expected life of the financial instrument, or a shorter period where appropriate, to the net carrying amount of the financial instrument. When calculating the effective interest rate, the Sub-Funds estimate cash flows considering all contractual terms of the financial instrument (for example, prepayment options) but does not consider future credit losses. The calculation includes all fees and points received between parties to the contract that are an integral part of the effective interest rate, transaction costs and all other premiums or discounts.

Dividend income is recorded on the ex-dividend date with the corresponding foreign withholding taxes recorded as an expense.

Expenses are accounted for on an accrual basis.

(d) Foreign currency translation

(i) Functional and presentation currency

Items included in the financial statements are measured using the currency of the primary economic environment in which the Sub-Funds operate (the “functional currency”). The Sub-Funds invest in mainly debt securities in the PRC and the performance of the Sub- Funds is measured and reported to the unitholders in RMB. The Manager considers RMB as the currency that most faithfully represents the economic effects of the underlying transactions, events and conditions. The financial statements are presented in RMB, which is the Sub-Funds’ functional and presentation currency.

(ii) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign currency assets and liabilities are translated into the functional currency using the exchange rate prevailing at the reporting date.

Foreign exchange gains and losses arising from translation are included in the statement of comprehensive income.

Foreign exchange gains and losses relating to the financial assets and liabilities carried at fair value through profit or loss are presented in the statement of comprehensive income within ‘net gain/(loss) on investments’.

(e) Cash and cash equivalents

Cash and cash equivalents include cash in hand, demand deposits, other short-term highly liquid investments with original maturities of three months or less.

- 15 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

2 Summary of significant accounting policies (Continued)

(f) Redeemable units

The Sub-Funds’ redeemable units, which are redeemable at the holder’s option, represent puttable financial instruments of the Sub-Funds. The Sub-Funds classify their puttable financial instruments as liabilities as the Sub-Funds issue more than one class of redeemable shares, which are redeemable at the holder’s option and do not have identical rights.

Units are issued and redeemed at the holder’s option at prices based on the Sub-Fund’s net asset value per unit at the time of issue or redemption. The Sub-Funds’ net asset value per unit is calculated by dividing the net assets attributable to unitholders with the total number of outstanding units. In accordance with the provisions of the Sub-Funds’ explanatory memorandum, investment positions are valued based on the last traded market price for the purpose of determining the net asset value per unit for subscriptions and redemptions.

(g) Distribution to unitholders

For E Fund RMB Fixed Income Fund, prior to 8 January 2015, no distribution will be paid out of capital. With effect from 8 January 2015, distribution may be paid from income and/or out of capital of the Sub-Fund.

For E Fund RMB Mainland China Bond Fund, distribution may be paid from income and/or out of capital of the Sub-Fund.

Distribution to unitholders is recognised in the statement of comprehensive income when they are approved by the Manager.

(h) Transaction costs

Transaction costs are costs incurred to acquire financial assets at fair value through profit or loss. They include the fees and commissions paid to agents, advisers, brokers and dealers. Transaction costs are expensed as incurred in the statement of comprehensive income.

(i) Taxation

The Sub-Funds currently incur withholding taxes imposed by the PRC on investment income. Such income is recorded gross of withholding taxes in the statement of comprehensive income. Withholding taxes and capital gains tax are included as taxation in the statement of comprehensive income.

Deferred income tax is provided, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the statement of financial position date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

- 16 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

3 Critical accounting estimates and assumptions

The Manager makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. Estimates are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are outlined below.

People’s Republic of China (“PRC”) taxation

In preparing these financial statements, the Manager has made certain assumptions and used various estimates concerning the tax exposure which is dependent on what might happen in the future. The resulting accounting estimates may not equal the related actual results.

There are currently no specific tax rules or regulations on the capital gains derived by foreign investors (including QFII / RQFII) from the disposal of RMB denominated bonds and collective investment schemes (“PRC Investments”). Under the general tax provision of PRC Corporate Income Tax Law (“PRC CIT Law”), the non-PRC residents with no place of effective management, establishment or place of business in the PRC may be subject to 10% PRC withholding income tax (“WIT”) on the PRC-sourced income, unless exempt or reduced under current PRC tax laws and regulations or relevant tax treaties. In addition, the non-PRC residents with interest income derived from the RMB denominated bonds will be subject to 10% withholding interest income tax. Pursuant to the PRC CIT Law, RMB denominated bonds issuers in PRC are obligated to withhold the 10% interest income tax for those foreign RMB denominated bonds holders who are subject to the interest income tax in the PRC. However, interest income derived from government bonds issued by the State Council’s finance departments and/or local government bonds approved by the State Council is exempt from PRC WIT under the PRC CIT Law.

(a) Capital gains on PRC Investments

For the financial year ended 31 December 2014

The Sub-Funds invest in A-Shares, RMB denominated bonds and collective investments schemes in PRC through the RQFII program. The Manager considers that the enforcement of PRC tax on gains derived from the PRC Investments was uncertain as at the date of approval of these financial statements for the year ended 31 December 2014 and has exercised its judgment when assessing whether the Sub-Funds may be liable for PRC taxation on its gains, the amount of potential liability and the probability of such tax being levied up to the reporting date. At that time, significant uncertainties existed and estimation of the Manager may substantially differ from the actual events. The Manager considers that its estimation may be impacted by any future clarification by the PRC State Administration of Taxation (“SAT”) and the applicability of the arrangement between the Mainland of China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (the “Arrangement”), which may be materially different from what the Manager envisioned.

Notice issued on 14 November 2014

On 14 November 2014, the Ministry of Finance of the PRC (the “MoF”), the State Administration of Taxation of the PRC (the “SAT”) and the China Securities Regulatory Commission (the “CSRC”) jointly issued the “Notice on temporary exemption of Corporate Income Tax on capital gains derived from the transfer of equity investment assets such as PRC domestic stocks by QFII and RQFII” (“the “Notice”).

- 17 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

3 Critical accounting estimates and assumptions (Continued)

People’s Republic of China (“PRC”) taxation (Continued)

(a) Capital gains on PRC Investments (Continued)

According to the Notice, amongst other things:

(i) QFIIs and RQFIIs, which do not have an establishment or place of business in the PRC or have an establishment or place in the PRC but the income so derived in the PRC is not effectively connected with such establishment, will be temporarily exempt from corporate income tax on gains derived from the transfer of PRC equity investment assets (including China A-Shares) effective from 17 November 2014;

(ii) PRC corporate income tax will be imposed on gains by QFIIs and RQFIIs from transfer of equity investment assets (including China A-Shares) realised prior to 17 November 2014 in accordance with laws.

As a result of the issue of the Notice, the Manager has decided on the following changes to the tax provisioning methodology of the Sub-Funds on 17 November 2014 (the “Effective Date”):

(i) The Sub-Funds have ceased to provide PRC withholding income tax for realised gains on trading of A-Shares on or after 17 November 2014;

(ii) No PRC withholding income tax provision is made for unrealised gains for A-shares. The tax provision made in relation to unrealised gains on the Sub-Fund’s investments in A- Shares has been released on 17 November 2014; and

(iii) The Sub-Funds continue to make tax provision for the gross realised gains derived from trading of A-Shares, since 18 January 2012 and 19 April 2013, the date of inception of the E Fund RMB Fixed Income Fund and E Fund RMB Mainland China Bond Fund respectively, to 14 November 2014. The Sub-Funds continue to make tax provision for the gross realised and unrealised gains derived from trading of RMB denominated bonds and collective investment schemes since date of inception to year ended 31 December 2014.

(iv) For E Fund RMB Fixed Income Fund, the Manager estimates that the accumulated gross realised gain for A-Shares, RMB denominated bonds and collective investment schemes of the Sub-Fund since inception and gross unrealised gain for RMB denominated bonds and collective investment schemes of the Sub-Fund as at 31 December 2014 which could be exposed to PRC capital gains tax at the rate of 10% to be approximately RMB82,341,251 and RMB14,226,062 respectively, and the Manager had made tax provision accordingly. The capital gains tax provision in relation to PRC Investments of the Sub-Fund included in the financial statements of RMB9,656,731 represents 1.16% of the net assets attributable to unitholders of redeemable units of the Sub-Fund as at 31 December 2014.

(v) For E Fund RMB Mainland China Bond Fund, the Manager estimates that the accumulated gross realised gain for RMB denominated bonds and collective investment schemes of the Sub-Fund since inception and gross unrealised gain for RMB denominated bonds and collective investment schemes of the Sub-Fund as at 31 December 2014 for which could be exposed to PRC capital gains tax at the rate of 10% to be approximately RMB8,856,070 and RMB1,901,883 respectively, and the Manager had made tax provision accordingly. The capital gains tax provision in relation to PRC Investments of the Sub-Fund included in the financial statements of RMB1,075,795 represents 0.13% of the net assets attributable to unitholders of redeemable units of the Sub-Fund as at 31 December 2014.

- 18 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

3 Critical accounting estimates and assumptions (Continued)

People’s Republic of China (“PRC”) taxation (Continued)

(a) Capital gains on PRC Investments (Continued)

For the financial year ended 31 December 2015

On 1 April 2015, the Third Branch of Shanghai Municipal Office, SAT (the “Authority”) and the Third Branch of Shanghai Bureau of Local Taxation jointly issued the Notice on Tax Issues to notify that the QFII/RQFII shall declare and handle with the tax-related issues concerning the gains from transfer of equity investment assets, including A-Shares, realised prior to 17 November 2014 to the Authority before 30 September 2015 in accordance with the relevant PRC tax law and the Notice (the “Tax Reporting”). Those QFII/RQFII’s eligible for treaty relief under an applicable tax treaty should follow the requirement of Circular 124 for tax treaty application (the “Tax Treaty Application”).

For E Fund RMB Fixed Income Fund, the Manager, on behalf of the Sub-Fund, had made the Tax Reporting for the period from 18 January 2012 (date of inception) to 14 November 2014 inclusively, applied on the Sub-Fund’s behalf the Tax Treaty Application, and submitted a “nil” basis tax return for gross realised capital gains derived from trading of debt securities in 2015. The Authority completed the review on the Sub-Fund's Tax Reporting and Tax Treaty Application and issued a document on its official web-site indicating that the Authority agrees with the Sub-Fund's Tax Treaty Application submitted. The Authority also endorsed the aforesaid nil basis tax return for the gross realised capital gains derived from trading of debt securities and issued a PRC tax demand note to the Sub-Fund to settle the PRC WIT on gross realised capital gains derived by the Sub-Fund from trading of PRC A-Shares issued by immovable properties-rich companies only for the period from 18 January 2012 (date of inception) up to and including 14 November 2014. Out of the PRC tax provision of the Sub-Fund as of 4 November 2015 of RMB13,519,538, the Sub-Fund settled the relevant PRC WIT liabilities in the amount of RMB40,675 on 4 November 2015 and the Manager reversed the unused WIT provision on PRC Investments amount to RMB13,478,863 on the same date. In addition, with effect on 4 November 2015, the Manager has decided to change the tax provisioning policy with the Sub-Fund ceased to provide PRC withholding income tax for realised and unrealised gains on trading of PRC Investments on or after 4 November 2015.

For E Fund Mainland China Bond Fund, the Manager, on behalf of the Sub-Fund, had made the Tax Reporting for the period from 19 April 2013 (date of inception) to 14 November 2014 inclusively in September 2015. The documents submitted include a “nil” basis tax return for gross realised capital gains derived from trading of PRC debt securities. The Authority endorsed the nil basis return for gross realised capital gains derived by the Sub-Fund from PRC debt securities for the period from 19 April 2013 (date of inception) up to and including 14 November 2014. On 10 December 2015, the Manager reversed the unused WIT provision on PRC debt securities amount to RMB 2,483,569. In addition, with effect on 10 December 2015, the Manager has decided to change the tax provisioning policy with the Sub-Fund ceased to provide PRC withholding income tax for realised and unrealised gains on trading of PRC debt securities on or after 10 December 2015.

- 19 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

3 Critical accounting estimates and assumptions (Continued)

People’s Republic of China (“PRC”) taxation (Continued)

(b) Interest income on debt securities in PRC

The Management considers that the enforcement of PRC withholding tax on interest income arising from debt securities is uncertain as at the date of approval of these financial statements. The Manager has exercised significant judgment in their assessment of the PRC withholding tax expense and the related tax provision.

For the debt securities disposed of during the year, the Management has not made provision on the accrued interest income of debt securities during the year and as at reporting date as they consider that:

(i) the issuers of debt securities are required to withhold 10% interest income tax at the coupon payment date before distributing the interest income to the bond holder; and

(ii) the Manager has sold the debt securities before the coupon payment dates or the maturity dates of the debt securities.

4 Financial risk management

The Sub-Funds’ activities may expose it to a variety of risks including but not limited to: market risk (including market price risk, interest rate risk and currency risk), credit and counterparty risk and liquidity risk which are associated with the markets in which the Sub-Funds invest.

The following is a summary of the main risks and risk management policies.

(a) Market price risk

Market price risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual instrument or factors affecting all instruments in the market.

The following table discloses the financial assets at fair value through profit or loss of the Sub-Funds by product type:

E Fund RMB Fixed Income Fund

2015 2014 RMB RMB

RMB denominated bonds 731,458,340 693,343,410 Collective investment schemes 54,138,821 11,248,675 A-Share equity securities 74,856,390 53,092,543 ─────────── ─────────── Total 860,453,551 757,684,628 ═══════════ ═══════════

- 20 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(a) Market price risk (Continued)

E Fund RMB Mainland China Bond Fund

2015 2014 RMB RMB

RMB denominated bonds 846,551,900 756,227,916 Collective investment schemes 40,000,000 51,364,378 ─────────── ─────────── Total 886,551,900 807,592,294 ═══════════ ═══════════

The following table discloses the non-derivative financial assets at fair value through profit or loss of the Sub-Funds by industrial sectors:

E Fund RMB Fixed Income Fund

2015 2014 % of net asset % of net asset RMB value RMB value

Basic Materials 24,264,046 2.76 64,585,662 7.76 Communications - - 5,857,970 0.70 Consumer, Cyclical 20,782,020 2.36 58,153,514 6.97 Consumer, Non-cyclical 22,458,859 2.54 9,664,909 1.16 Diversified 358,726,410 40.68 251,818,270 30.22 Financial 336,348,946 38.13 189,117,445 22.69 Government 8,104,000 0.92 - - Industrial 82,632,162 9.37 168,214,509 20.18 Technology - - 1,364,400 0.16 Utilities 7,137,108 0.81 8,907,949 1.07 ─────────── ─────── ─────────── ─────── Grand Total 860,453,551 97.57 757,684,628 90.91 ═══════════ ═══════ ═══════════ ═══════

E Fund RMB Mainland China Bond Fund

2015______2014______% of net asset % of net asset RMB value RMB value

Basic Materials 93,382,246 10.28 27,035,175 3.16 Consumer, Cyclical 103,365,650 11.38 - - Consumer, Non-cyclical - - 140,025,040 16.35 Diversified 67,031,330 7.39 66,472,505 7.76 Energy 171,063,324 18.84 110,077,440 12.87 Financial 199,233,472 21.94 148,494,050 17.35 Industrial 149,907,528 16.51 189,976,285 22.19 Utilities 102,568,350 11.28 125,511,799 14.67 ─────────── ─────── ─────────── ─────── Grand Total 886,551,900 97.62 807,592,294 94.35 ═══════════ ═══════ ═══════════ ═══════ - 21 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(a) Market price risk (Continued)

The Sub-Funds’ market price risk is managed through diversification of the investment portfolio ratios by exposures to different industries.

There is no exposure to individual investments/issuers representing over 10% of the Sub-Funds’ net asset value at the reporting date.

At 31 December 2015, E Fund RMB Fixed Income Fund invests in A-Share equity securities and index funds and is susceptible to market price risk arising from uncertainties about future values of those investments. If the prices of these investments had increased/decreased by 10%, the Sub- fund’s pre-tax profits for the year would have resulted in an increase/ decrease of RMB8,819,449 (2014: RMB5,309,254).

As the Sub-Funds mainly invest in debt securities, the sensitivity analysis of market price risk is disclosed in the interest rate sensitivity analysis in note 4(b) below.

As at 31 December 2015 and 2014, the Sub-Funds invest in collective investment schemes that mainly comprise money market funds, which are not subjected to significant market price risk. Accordingly, no sensitivity analysis has been disclosed for these investments.

(b) Interest rate risk

Interest rate risk arises from the effects of fluctuations in the prevailing levels of market interest rates on the fair value of financial assets and liabilities and future cash flow. The tables below summarise the Sub-Funds’ exposure to interest rate risks at the reporting date. Included in the table are the Sub-Funds’ assets and liabilities at fair values, categorised by the earlier of contractual repricing or maturity dates.

- 22 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(b) Interest rate risk (Continued)

E Fund RMB Fixed Income Fund

As at 31 December 2015

Maturity Maturity Maturity Non-interest up to 1 year 1-5 years over 5 years Bearing Total RMB RMB RMB RMB RMB

Assets Investments - RMB denominated bonds - 129,329,195 602,129,145 - 731,458,340 - Collective investment schemes - - - 54,138,821 54,138,821 - A-Share equity securities - - - 74,856,390 74,856,390 Interest receivable - - - 23,937,881 23,937,881 Subscription receivable - - - 11,559 11,559 Deposit reserve 244,784 - - - 244,784 Cash and cash equivalents 6,898,996 - - - 6,898,996 ────────── ────────── ────────── ─────────── ───────────

Total assets 7,143,780 129,329,195 602,129,145 152,944,651 891,546,771 ══════════ ══════════ ══════════ ═══════════ ═══════════

Liabilities Management fee payable - - - 475,729 475,729 Trustee fee payable - - - 83,725 83,725 Custodian Payable - - - 60,891 60,891 Redemption payable - - - 3,633,604 3,633,604 Accrued expenses and other payables - - - 459,437 459,437 Net assets attributable to unitholders - - - 882,273,172 882,273,172 ────────── ────────── ────────── ─────────── ─────────── Total liabilities - - - 886,986,558 886,986,558 ══════════ ══════════ ══════════ ═══════════ ═══════════ Total interest sensitivity gap 7,143,780 129,329,195 602,129,145 ══════════ ══════════ ══════════

- 23 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(b) Interest rate risk (Continued)

E Fund RMB Fixed Income Fund

As at 31 December 2014

Maturity Maturity Maturity Non-interest up to 1 year 1-5 years over 5 years Bearing Total RMB RMB RMB RMB RMB

Assets Investments - RMB denominated bonds 52,516,650 241,697,930 399,128,830 - 693,343,410 - Collective investment schemes - - - 11,248,675 11,248,675 - A-Share equity securities - - - 53,092,543 53,092,543 Interest receivable - - - 26,373,850 26,373,850 Subscription receivable - - - 215,883,678 215,883,678 Deposit reserve 231,808 - - - 231,808 Cash and cash equivalents 65,857,789 - - - 65,857,789 ────────── ────────── ────────── ─────────── ─────────── Total assets 118,606,247 241,697,930 399,128,830 306,598,746 1,066,031,753 ══════════ ══════════ ══════════ ═══════════ ═══════════

Liabilities Management fee payable - - - 492,510 492,510 Trustee fee payable - - - 80,932 80,932 Custodian fee payable - - - 58,860 58,860 Redemption payable - - - 217,930,969 217,930,969 Accrued expenses and other payables - - - 477,679 477,679 Net assets attributable to unitholders - - - 834,072,230 834,072,230 ────────── ────────── ────────── ─────────── ─────────── Total liabilities - - - 1,053,113,180 1,053,113,180 ══════════ ══════════ ══════════ ═══════════ ═══════════ Total interest sensitivity gap 118,606,247 241,697,930 399,128,830 ══════════ ══════════ ══════════

- 24 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(b) Interest rate risk (Continued)

E Fund RMB Mainland China Bond Fund

As at 31 December 2015

Maturity Maturity Maturity Non-interest up to 1 year 1-5 years over 5 years Bearing Total RMB RMB RMB RMB RMB

Assets Investments - RMB denominated bonds 277,679,438 524,707,822 44,164,640 - 846,551,900 - Collective investment schemes - - - 40,000,000 40,000,000 Interest receivable - - - 19,707,554 19,707,554 Amount due from brokers - - - - - Deposit reserve 231,375 - - - 231,375 Cash and cash equivalents 4,875,937 - - - 4,875,937 ────────── ────────── ───────── ───────── ────────── Total assets 282,786,750 524,707,822 44,164,640 59,707,554 911,366,766 ══════════ ══════════ ═════════ ═════════ ══════════

Liabilities Management fee payable - - - 388,725 388,725 Trustee fee payable - - - 85,290 85,290 Custodian fee payable - - - 62,029 62,029 Accrued expenses and other payables - - - 345,119 345,119 Net assets attributable to unitholders - - - 908,389,843 908,389,843 ────────── ────────── ───────── ────────── ────────── Total liabilities - - - 909,271,006 909,271,006 ══════════ ══════════ ═════════ ══════════ ══════════ Total interest sensitivity gap 282,786,750 524,707,822 44,164,640 ══════════ ══════════ ═════════

- 25 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(b) Interest rate risk (Continued)

E Fund RMB Mainland China Bond Fund

As at 31 December 2014

Maturity Maturity Maturity Non-interest up to 1 year 1-5 years over 5 years Bearing Total RMB RMB RMB RMB RMB

Assets Investments - RMB denominated bonds 304,896,434 399,957,102 51,374,380 - 756,227,916 - Collective investment schemes - - - 51,364,378 51,364,378 Interest receivable - - - 22,626,765 22,626,765 Amounts due from brokers - - - 10,206,535 10,206,535 Deposit reserve 226,465 - - - 226,465 Cash and cash equivalents 19,434,437 - - - 19,434,437 ────────── ────────── ───────── ───────── ────────── Total assets 324,557,336 399,957,102 51,374,380 84,197,678 860,086,496 ══════════ ══════════ ═════════ ═════════ ══════════

Liabilities Management fee payable - - - 362,329 362,329 Trustee fee payable - - - 79,582 79,582 Custodian fee payable - - - 57,878 57,878 Accrued expenses and other payables - - - 335,835 335,835 Net assets attributable to unitholders - - - 856,214,145 856,214,145 ────────── ────────── ───────── ────────── ────────── Total liabilities - - - 857,049,769 857,049,769 ══════════ ══════════ ═════════ ══════════ ══════════ Total interest sensitivity gap 324,557,336 399,957,102 51,374,380 ══════════ ══════════ ═════════

At 31 December 2015, E Fund RMB Fixed Income Fund and E Fund RMB Mainland China Bond Fund have cash and cash equivalents of RMB6,898,996 (2014: RMB65,857,789) and RMB4,875,937 (2014: RMB19,434,437) respectively. If the interest rates had been 10 basis points higher or lower with all variables held constant, net assets attributable to unitholders of E Fund RMB Fixed Income Fund and E Fund RMB Mainland China Bond Fund would have been RMB6,899 (2014: RMB65,858) and RMB4,876 (2014: RMB19,434) higher or lower respectively as a result of higher or lower interest income.

- 26 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(b) Interest rate risk (Continued)

The majority of the Sub-Funds’ interest rate exposure on debt instruments are RMB denominated. Interest rate exposures are expressed in terms of rate of weighted modified duration. The Manager monitors the interest rate risks by quantifying market exposure in duration terms. Beta adjusted weighted modified duration is the modified duration multiplied by the allocation of net asset value and a sensitivity factor (beta). As at 31 December 2015, E Fund RMB Fixed Income Fund has invested in interest-bearing securities of RMB731,458,340 (2014: RMB693,343,410) and the portfolio weighted average modified duration of the Sub-Fund is 3.68 (2014: 2.83). As at 31 December 2015, E Fund RMB Mainland China Bond Fund has invested in interest-bearing securities of RMB846,551,900 (2014: RMB756,227,916) and the portfolio weighted average modified duration of the Sub-Fund is 1.45 (2014: 1.38).

At 31 December 2015, should interest rates have lowered/risen by 25 basis points with all other variables remaining constant, the increase/decrease in net assets attributable to unitholders for the year would amount to approximately RMB 6,731,038 (2014: RMB4,899,233) for E Fund RMB Fixed Income Fund and RMB3,070,873 (2014: RMB2,599,754) for E Fund RMB Mainland China Bond Fund, arising substantially from the increase/decrease in market values of debt securities.

(c) Currency risk

Currency risk is the risk that the value of financial instruments will fluctuate due to changes in foreign exchange rates. The Sub-Funds are not exposed to currency risk arising from balances and transactions in foreign currencies as a majority of their assets and liabilities are denominated in RMB, the Sub-Funds’ functional and presentation currency. Accordingly, the Management considers that it is not necessary to present a sensitivity analysis of currency risk.

(d) Credit and counterparty risk

Credit and counterparty risk is the risk that an issuer or counterparty will be unable or unwilling to meet a commitment that it has entered into with the Sub-Funds.

All transactions in securities are settled or paid for upon delivery using approved and reputable brokers. The risk of default is considered minimal, as delivery of securities sold is made only when the custodian has received payment. Payment is made on a purchase when the securities have been received by the broker. The trade will fail if either party fails to meet its obligation.

The main concentration to which the Sub-Funds are exposed arises from the Sub-Funds’ investments in debt securities. The Sub-Funds do not have explicit restrictions on the minimum credit ratings of securities it may hold. The Manager will actively manage the portfolio of the Sub- Funds. In case of credit rating downgrading, the Manager will adjust the positions in the portfolio using its credit analysis and rating systems that are designed to manage credit risks.

- 27 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(d) Credit and counterparty risk (Continued)

E Fund RMB Fixed Income Fund

The table below summarises the credit rating of the Sub-Fund’s debt portfolio, which represents 82.94% (2014: 83.20%) of the net asset value as at 31 December 2015 and 2014:

Portfolio by rating category of RMB denominated bonds: 2015 2014 % of net % of net Rating asset value asset value

China Chengxin AAA - 1.00 AA+ 2.67 0.46 AA 2.43 - A-1 - 0.6

China Lianhe AA+ - 3.69 AA 6.27 0.31 A-1 - 3.60

Dagong Global Credit Rating AAA 6.29 - AA+ 7.16 0.31 AA 4.71 12.37

Shanghai Brilliance Credit Rating AAA 0.02 - AA+ 2.36 4.42 AA 6.20 2.32 AA- - 9.07

S&P AA- 0.92 -

PengYuan Credit Rating Co., Ltd AA 34.17 32.19

Golden Credit Rating International AA 9.74 11.06

Non-rated - 1.80 ────────── ────────── 82.94 83.20 ══════════ ══════════

- 28 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(d) Credit and counterparty risk (Continued)

E Fund RMB Mainland China Bond Fund

The table below summarises the credit rating of the Sub-Fund’s debt portfolio, which represents 93.22% (2014: 88.36%) of the net asset value as at 31 December 2015 and 2014:

Portfolio by rating category of RMB denominated bonds: 2015 2014 % of net % of net Rating asset value asset value

China Chengxin AAA 20.52 10.61 A-1 13.58 2.33

China Lianhe AAA 26.10 21.04 AA - 4.66 A-1 7.28 5.83

Dagong Global Credit Rating AA+ 8.26 - AA - 1.22 A-1 2.20 12.85

Shanghai Brilliance Credit Rating AAA - 3.52 AA 3.52 - AA- - 6.58 A-1 - 0.58

PengYuan Credit Rating Co., Ltd AA+ 1.38 3.56 AA 3.93 6.24

Golden Credit Rating International AA 1.16 -

Non-rated 5.29 9.34 ────────── ────────── 93.22 88.36 ══════════ ══════════

The Manager has assessed the credit quality of the RMB denominated bonds based on the nature of the issuers and the historical information about the issuers’ default rates.

- 29 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(d) Credit and counterparty risk (Continued)

The Sub-Funds are also exposed to credit and counterparty risk on cash and cash equivalents. The table below summarises the net exposure to the Sub-Funds’ counterparties together with their credit ratings.

E Fund RMB Fixed Income Fund

As at 31 December 2015

Credit Source of RMB rating credit rating Investments Bank of Communications Co., Ltd Standard & 830,424,389 A- Poor’s

Cash and cash equivalents Bank of Communications Co., Ltd Hong Kong Standard & Branch1 4,961,422 A- Poor’s Bank of Communications Co., Ltd Standard & 1,937,574 A- Poor’s

As at 31 December 2014 Credit Source of RMB rating credit rating Investments Bank of Communications Co., Ltd 757,684,628 A- Standard & Poor’s

Cash and cash equivalents Bank of Communications Co., Ltd Hong Kong Branch1 11,518,178 A- Standard & Poor’s Bank of Communications Co., Ltd 54,339,611 A- Standard & Poor’s

E Fund RMB Mainland China Bond Fund

As at 31 December 2015

Credit Source of RMB rating credit rating Investments Bank of Communications Co., Ltd Standard & 846,551,900 A- Poor’s

Cash and cash equivalents Bank of Communications Co., Ltd Hong Kong Standard & Branch1 2,470,360 A- Poor’s Bank of Communications Co., Ltd Standard & 2,405,577 A- Poor’s

- 30 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(d) Credit and counterparty risk (Continued)

E Fund RMB Mainland China Bond Fund (Continued)

As at 31 December 2014

Credit Source of RMB rating credit rating Investments Bank of Communications Co., Ltd Standard & 757,592,294 A- Poor’s

Cash and cash equivalents Bank of Communications Co., Ltd Hong Kong Standard & Branch1 6,117,084 A- Poor’s Bank of Communications Co., Ltd Standard & 13,317,353 A- Poor’s

1 Credit rating of its ultimate holding company Bank of Communications Co., Ltd. is used

As at 31 December 2015, E Fund RMB Fixed Income Fund invests in collective investment schemes that comprise money market funds and bond funds of RMB40,800,721 (2014: RMB11,248,675) and E Fund RMB Mainland China Bond Fund invests in collective investment schemes that comprise money market funds of RMB40,000,000 (2014: invests in a money market fund and a bond fund of RMB51,364,378), which are subject to indirect credit risk from the underlying investments.

The maximum exposure to credit risk as at 31 December 2015 and 2014 is the carrying amount of the financial assets as shown on the statement of financial position.

The Manager considers that none of these assets are impaired nor past due.

(e) Liquidity risk

Liquidity risk is the risk that the Sub-Funds may not be able to generate sufficient cash resources to settle its obligations in full as they fall due or can only do so on terms that are materially disadvantageous.

The Sub-Funds are exposed to daily redemptions of units in the Sub-Funds. The Sub-Funds invest the majority of their assets in securities that are traded in an active market which can be readily disposed of.

The table below analyses the Sub-Funds’ non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the reporting date to the contractual maturity date. The amounts in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances, as the impact of discounting is not significant.

- 31 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(e) Liquidity risk (Continued)

E Fund RMB Fixed Income Fund

Less than 3 months RMB As at 31 December 2015 Management fee payable 475,729 Trustee fee payable 83,725 Custodian fee payable 60,891 Redemption payable 3,633,604 Accruals and other payables 459,437 Net assets attributable to unitholders 882,273,172 ─────────── Contractual cash outflow 886,986,558 ═══════════ As at 31 December 2014 Management fee payable 492,510 Trustee fee payable 80,932 Custodian fee payable 58,860 Redemption payable 217,930,969 Accrued expenses and other payables 477,679 Net assets attributable to unitholders 834,072,230 ─────────── Contractual cash outflow 1,053,113,180 ═══════════

E Fund RMB Mainland China Bond Fund

Less than 3 months RMB As at 31 December 2015 Management fee payable 388,725 Trustee fee payable 85,290 Custodian fee payable 62,029 Accruals and other payables 345,119 Net assets attributable to unitholders 908,389,843 ────────── Contractual cash outflow 909,271,006 ══════════

As at 31 December 2014 Management fee payable 362,329 Trustee fee payable 79,582 Custodian fee payable 57,878 Accrued expenses and other payables 335,835 Net assets attributable to unitholders 856,214,145 ────────── Contractual cash outflow 857,049,769 ══════════

- 32 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(e) Liquidity risk (Continued)

E Fund RMB Mainland China Bond Fund (Continued)

Units are redeemed on demand at the unitholder’s option. With a view to protecting the interest of unitholders, the Manager is entitled, with the approval of the Trustee, to limit the number of units of the Sub-Funds redeemed on any dealing day to 10% of the total number of units in issue. As at 31 December 2015, there were 1 (2014: 4) and 1 (2014: 1) unitholder accounts each holding more than 10% of the Sub-Funds’ units for E Fund RMB Fixed Income Fund and E Fund RMB Mainland China Bond Fund respectively.

As at 31 December 2015, the total assets of the Sub-Funds amounted to RMB891,546,771 (2014: RMB1,066,031,753) for E Fund RMB Fixed Income Fund and RMB911,366,766 (2014: RMB860,086,496) for E Fund RMB Mainland China Bond Fund. The Sub-Funds manage their liquidity risk by investing in securities that it expects to be able to liquidate within 3 months or less.

The following table illustrates the expected liquidity of assets held:

E Fund RMB Fixed Income Fund

Less than Over 3 months 3 months RMB RMB

As at 31 December 2015

Total assets 874,852,693 16,694,078 ═══════════ ═══════════

As at 31 December 2014

Total assets 1,052,263,322 13,768,431 ═══════════ ═══════════

E Fund RMB Mainland China Bond Fund

Less than Over 3 months 3 months RMB RMB

As at 31 December 2015

Total assets 901,005,397 10,361,369 ═══════════ ═══════════

As at 31 December 2014

Total assets 848,466,473 11,620,023 ═══════════ ═══════════

- 33 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(f) Fair value estimation

The Sub-Funds classify fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

. Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1). . Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2). . Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3).

The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety is determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. For this purpose, the significance of an input is assessed against the fair value measurement in its entirety. If a fair value measurement uses observable inputs that require significant adjustment based on unobservable inputs, that measurement is a level 3 measurement. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgment, considering factors specific to the asset or liability.

The determination of what constitutes “observable” requires significant judgment by the Sub-Funds. The Sub-Funds consider observable data to be that market data that is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market.

The following table analyses within the fair value hierarchy the Sub-Funds’ financial assets and liabilities measured at fair value at 31 December 2015 and 2014:

E Fund RMB Fixed Income Fund

Level 1 Level 2 Level 3 Total RMB RMB RMB RMB

As at 31 December 2015 Assets Financial assets at fair value through profit or loss - RMB denominated bonds 86,265,990 623,876,350 21,316,000 731,458,340 - Collective investment schemes - 54,138,821 - 54,138,821 - A-Share equity securities 73,195,206 1,661,184 - 74,856,390 ────────── ────────── ──────── ─────────── Total assets 159,461,196 679,676,355 21,316,000 860,453,551 ══════════ ══════════ ════════ ═══════════

- 34 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(f) Fair value estimation (Continued)

E Fund RMB Fixed Income Fund (Continued)

Level 1 Level 2 Level 3 Total RMB RMB RMB RMB

As at 31 December 2014 Assets Financial assets at fair value through profit or loss - RMB denominated bonds 151,994,490 541,348,920 - 693,343,410 - Collective investment schemes - 11,248,675 - 11,248,675 - A-Share equity securities 51,728,143 1,364,400 - 53,092,543 ────────── ────────── ─────── ─────────── Total assets 203,722,633 553,961,995 - 757,684,628 ══════════ ══════════ ═══════ ═══════════

E Fund RMB Mainland China Bond Fund

Level 1 Level 2 Level 3 Total RMB RMB RMB RMB

As at 31 December 2015 Assets Financial assets at fair value through profit or loss - RMB denominated bonds 10,478,952 836,072,948 - 846,551,900 - Collective investment schemes - 40,000,000 - 40,000,000 ────────── ────────── ─────── ─────────── Total assets 10,478,952 876,072,948 - 886,551,900 ══════════ ══════════ ═══════ ═══════════

As at 31 December 2014 Assets Financial assets at fair value through profit or loss - RMB denominated bonds 98,603,782 657,624,134 - 756,227,916 - Collective investment schemes - 51,364,378 - 51,364,378 ────────── ────────── ─────── ─────────── Total assets 98,603,782 708,988,512 - 807,592,294 ══════════ ══════════ ═══════ ═══════════

- 35 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(f) Fair value estimation (Continued)

Investments whose values are based on quoted market prices in active markets, and therefore classified within level 1, include active listed bonds, active listed equities, exchange traded funds and derivatives. The Sub-Funds do not adjust the quoted price for these instruments.

Financial instruments including RMB denominated bonds that trade in markets which are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within level 2. The investments in unlisted RMB denominated bonds are valued with reference to valuation provided by China Central Depository & Clearing Co., Ltd. As at 31 December 2015, E Fund RMB Fixed Income Fund held 1 (2014: 1) A-Share equity securities where trading has been suspended at year end and is classified in level 2. As level 2 investments include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

The collective investment schemes classified in Level 2 were fair valued using the net asset value of the scheme, as reported by the respective collective investment schemes’ administrator. For these collective investment schemes, management believes the Sub-Funds could have redeemed their investment at the net asset value per share at the statement of financial position date.

Investments classified within level 3 have significant unobservable inputs, as they trade infrequently. Level 3 instruments include RMB denominated bonds that were valued based on long outdated historical prices. As at 31 December 2015, there was 2 (2014: nil) level 3 investment held by E Fund RMB Fixed Income Fund. The investments were valued with reference to the last traded prices as of 26 November 2014 and 3 March 2015 respectively.

During the year ended 31 December 2015, there were transfers between levels for E Fund RMB Fixed Income Fund:

Level 2 Level 3 RMB RMB Transfer between levels 2 and 3: RMB denominated bonds Transfer out of Level 2 (21,200,000) 21,200,000

The bond transfer out of level 2 relate to position that was based on long outdated historical price as at 31 December 2015. During the year ended 31 December 2014, there were no transfers between levels for E Fund RMB Fixed Income Fund.

During the year ended 31 December 2015 and 2014, there were no transfers between levels for E Fund RMB Mainland China Bond Fund.

Transfers between levels of the fair value hierarchy, for the purpose of preparing the above table, are deemed to have occurred at the beginning of the reporting period.

- 36 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

4 Financial risk management (Continued)

(f) Fair value estimation (Continued)

The following table presents the movement in level 3 instruments for E Fund RMB Fixed Income Fund:

2015 2014 RMB RMB

Opening balance - - Purchases 116,000 Transfer from level 2 into level 3 21,200,000 - ───────── ──────── Closing Balance 21,316,000 - ═════════ ════════

Change in unrealised gains for level 3 assets held at year end and included in other net changes in fair value on financial assets and liabilities at fair value through profit or loss 1,200,000 - ═════════ ════════

The carrying amount of interest receivable, cash and cash equivalents, deposit reserve, amounts due to brokers, management fee payable, trustee fee payable, custodian fee payable, redemption payable, accrued expenses and other payable and net assets attributable to unitholders approximated their fair values and are presented in the statement of financial position. There are no financial assets and financial liabilities not carried at fair value but for which the fair value is disclosed.

(g) Capital risk management

The Sub-Funds’ capital is represented by the net assets attributable to unitholders. The Sub-Funds strive to invest the subscriptions in investments that meet the Sub-Funds’ investment objectives while maintaining sufficient liquidity to meet unitholder redemptions. The Management may:

 Redeem and issue new units in accordance with the constitutive documents of the Sub- Funds;  Exercise discretion when determining the amount of distributions of the Sub-Funds to the unitholders

- 37 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

5 Financial instruments by category

Financial assets

Apart from financial assets of investments as disclosed in the statement of financial position which are classified as at fair value through profit or loss, all other financial assets as disclosed in the statement of financial position, including deposit reserve, interest receivable, amount subscription receivable and cash and cash equivalents, are categorised as “loans and receivables”.

Financial liabilities

All financial liabilities as disclosed in the statement of financial position, including management fee payable, trustee fee payable, custodian fee payable, redemption payable, accrued expenses and other payables and net assets attributable to unitholders, are categorised as “other financial liabilities”.

6 Net changes in fair value on investments

E Fund RMB Fixed Income Fund

2015 2014 RMB RMB

Change in unrealised gains of investments 9,846,590 47,717,199 Net realised gains on sale of investments 60,822,842 9,578,723 ───────── ───────── 70,669,432 57,295,922 ═════════ ═════════

E Fund RMB Mainland China Bond Fund

2015 2014 RMB RMB

Change in unrealised gains/(losses) of investments 9,208,857 (308,729) Net realised gains on sale of investments 7,160,621 5,711,293 ───────── ───────── 16,369,478 5,402,564 ═════════ ═════════

- 38 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

7 Number of units in issue and net assets attributable to unitholders per unit

E Fund RMB Fixed Income Fund

As at 31 December 2015, E Fund RMB Fixed Income Fund issued 5 classes of units – Class A RMB (accumulation) units, Class A RMB (distribution) units, Class A USD (accumulation) units, Class I RMB (distribution) units and Class I USD (accumulation) units. Class A (accumulation) units and Class A (distribution) units are available for sale to the retail public in Hong Kong. Class I (accumulation) units and Class I (distribution) units are offered to institutional investors. There is no dividend distribution for accumulation classes of units.

The movements of the redeemable units are as follows: 2015 2014 RMB RMB

Class A RMB (accumulation) units Number of units in issue at the beginning of the year - - Units issued 12,855 - ───────── ───────── Number of units in issue at the end of the year 12,855 - ═════════ ═════════

2015 2014 RMB RMB

Class A RMB (distribution) units Number of units in issue at the beginning of the year 2,622,167 7,196,496 Units issued 404,537 131,845 Units redeemed (1,157,070) (4,706,174) ───────── ───────── Number of units in issue at the end of the year 1,869,634 2,622,167 ═════════ ═════════

2015 2014 RMB RMB

Class A USD (accumulation) units Number of units in issue at the beginning of the year 12,054 - Units issued 156,040 12,054 Units redeemed (58,897) - ───────── ───────── Number of units in issue at the end of the year 109,197 12,054 ═════════ ═════════

2015 2014 RMB RMB

Class I RMB (distribution) units Number of units in issue at the beginning of the year 5,099,942 4,030,245 Units issued 6,273,716 6,139,465 Units redeemed (5,633,262) (5,069,768) ───────── ───────── Number of units in issue at the end of the year 5,740,396 5,099,942 ═════════ ═════════

- 39 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

7 Number of units in issue and net assets attributable to unitholders per unit (Continued)

E Fund RMB Fixed Income Fund (Continued)

2015 2014 RMB RMB

Class I USD (accumulation) units Number of units in issue at the beginning of the year - - Units issued 1,191,930 - Units redeemed (1,191,930) - ───────── ───────── Number of units in issue at the end of the year - - ═════════ ═════════

E Fund RMB Mainland China Bond Fund

As at 31 December 2015, E Fund RMB Mainland China Bond Fund issued 5 classes of units – Class A RMB (accumulation) units, Class A RMB (distribution) units, Class A HKD (accumulation) units, Class I RMB (accumulation) units and Class I USD (accumulation) units. Class A (accumulation) units and Class A (distribution) units are available for sale to the retail public in Hong Kong. Class I (accumulation) units and Class I (distribution) units are offered to institutional investors. There is no dividend distribution for accumulation classes of units.

The movements of the redeemable units are as follows:

2015 2014 RMB RMB

Class A RMB (accumulation) units Number of units in issue at the beginning of the year 1,477 8,363 Units issued 4,614 - Units redeemed (1,177) (6,886) ───────── ───────── Number of units in issue at the end of the year 4,914 1,477 ═════════ ═════════

2015 2014 RMB RMB

Class A RMB (distribution) units Number of units in issue at the beginning of the year 12,493 19,752 Units issued 16,450 4,988 Units redeemed (7,639) (12,247) ───────── ───────── Number of units in issue at the end of the year 21,304 12,493 ═════════ ═════════

- 40 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

7 Number of units in issue and net assets attributable to unitholders per unit (Continued)

E Fund RMB Mainland China Bond Fund (Continued)

2015 2014 RMB RMB

Class A HKD (accumulation) units Number of units in issue at the beginning of the year - - Units issued 5 - ───────── ───────── Number of units in issue at the end of the year 5 - ═════════ ═════════

2015 2014 RMB RMB

Class I RMB (accumulation) units Number of units in issue at the beginning of the year 8,232,955 9,558,814 Units issued 839,613 10,117,531 Units redeemed (849,613) (11,443,390) ───────── ───────── Number of units in issue at the end of the year 8,222,955 8,232,955 ═════════ ═════════

2015 2014 RMB RMB

Class I USD (accumulation) units Number of units in issue at the beginning of the year - - Units issued 372,636 290,982 Units redeemed (372,636) (290,982) ───────── ───────── Number of units in issue at the end of the year - - ═════════ ═════════

In accordance with the Sub-Funds’ explanatory memorandum, the establishment costs of the Sub- Funds will be amortised over the first five years. However, the accounting policy of the Sub-Funds for the purpose of financial statements preparation in compliance with IFRS is to expense establishment costs in the statement of comprehensive income as incurred. The difference between expensing the establishment costs as incurred in accordance with IFRS and capitalisation and amortisation of the establishment costs indicated in the Sub-Funds’ explanatory memorandum resulted in an adjustment of RMB359,533 (2014: RMB668,309) and RMB219,004 (2014: RMB302,717) for E Fund RMB Fixed Income Fund and E Fund RMB Mainland China Bond Fund respectively in the statement of financial position.

The changes in the fair value adjustment of net asset value are RMB308,776 (2014: RMB308,776) and RMB83,713 (2014: RMB71,003) for E Fund RMB Fixed Income Fund and E Fund Mainland China Bond Fund respectively and are recognised in the statement of comprehensive income.

- 41 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

7 Number of units in issue and net assets attributable to unitholders per unit (Continued)

The following table details the net asset value per unit of each class of units (before amortisation of establishment costs) at the reporting date:

E Fund RMB Fixed Income Fund

Number of Net assets Units Net asset per class outstanding value per unit RMB RMB

At 31 December 2015 Class A RMB (accumulation) 1,555,352 12,855 RMB120.99 Class A RMB (distribution) 210,939,886 1,869,634 RMB112.82 Class A USD (accumulation) 8,204,577 109,197 USD11.41 Class I RMB (distribution) 661,573,357 5,740,396 RMB115.24 ══════════ ═════════ ═════════

At 31 December 2014 Class A RMB (distribution) 280,169,833 2,622,167 RMB106.84 Class A USD (accumulation) 799,736 12,054 USD10.68 Class I RMB (distribution) 553,102,661 5,099,942 RMB108.45 ══════════ ═════════ ═════════

E Fund RMB Mainland China Bond Fund

Number of Net assets Units Net asset per class outstanding value per unit RMB RMB

At 31 December 2015 Class A RMB (accumulation) 535,028 4,914 RMB108.87 Class A RMB (distribution) 2,102,055 21,304 RMB98.66 Class A HKD (accumulation) 420 5 HKD105.93 Class I RMB (accumulation) 905,752,340 8,222,955 RMB110.14 ══════════ ═════════ ═════════

At 31 December 2014 Class A RMB (accumulation) 152,319 1,477 RMB103.14 Class A RMB (distribution) 1,226,096 12,493 RMB98.14 Class I RMB (accumulation) 854,835,730 8,232,955 RMB103.83 ══════════ ═════════ ═════════

- 42 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

8 Transactions with the Trustee, Manager and connected persons

The following is a summary of significant related party transactions/transactions entered into during the period between the Sub-Funds and the Trustee, the Manager and their Connected Persons. Connected Persons of the Manager are those as defined in the Code on Unit Trusts and Mutual Funds established by the Securities & Futures Commission of Hong Kong (the “SFC Code”). All transactions entered into during the period between the Sub-Funds and the Manager and its Connected Persons were carried out in the normal course of business and on normal commercial terms. To the best of the Manager’s knowledge, the Sub-Funds do not have any other transactions with Connected Persons except for those disclosed below.

(a) Management fee

The Manager is entitled to receive a management fee of up to 3% per annum of the net asset value of the Sub-Funds, calculated and accrued on each dealing day and payable monthly in arrears. In respect of the Sub-Funds, the Manager currently charges a rate of 1% per annum for Class A and 0.5% per annum for Class I.

For E Fund RMB Fixed Income Fund, the management fee charged for the year was RMB6,137,714 (2014: RMB6,680,441), of which RMB475,729 (2014: RMB492,510) was outstanding at 31 December 2015.

For E Fund RMB Mainland China Bond Fund, the management fee charged for the year was RMB4,568,844 (2014: RMB4,921,369), of which RMB388,725 (2014: RMB362,329) was outstanding at 31 December 2015.

(b) Trustee fee

The Trustee is entitled to receive a trustee fee of up to 1% per annum of the net asset value of the Sub-Funds. Currently, the Trustee is entitled to receive a fee of 0.11% per annum of the net asset value of each class of the Sub-Funds, subject to a monthly minimum fee of RMB26,000 for each class of units. The fee is calculated and accrued daily and payable monthly in arrears.

For E Fund RMB Fixed Income Fund, the trustee fee charged for the year was RMB1,075,634 (2014: RMB957,485), of which RMB83,725 (2014: RMB80,932) was outstanding at 31 December 2015.

For E Fund RMB Mainland China Bond Fund, the trustee fee charged for the year was RMB1,003,029 (2014: RMB1,079,985), of which RMB85,290 (2014: RMB79,582) outstanding at 31 December 2015.

(c) Custodian fee

The PRC Custodian is entitled to receive a custodian fee of up to 0.5% per annum of the net asset value of the Sub-Funds. Currently, the PRC Custodian is entitled to receive a fee of 0.1% per annum of the net asset value. The fee is calculated and payable monthly in arrears.

For E Fund RMB Fixed Income Fund, the custodian fee charged for the year was RMB782,279 (2014: RMB730,714), of which RMB60,891 (2014: RMB58,860) was outstanding at 31 December 2015.

For E Fund RMB Mainland China Bond Fund, the custodian fee charged for the year was RMB729,476 (2014: RMB816,535), of which RMB62,029 (2014: RMB57,878) outstanding at 31 December 2015.

- 43 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

8 Transactions with the Trustee, Manager and connected persons (Continued)

(d) Cash and cash equivalents and investments

For E Fund RMB Fixed Income Fund, the total cash and cash equivalents of the Sub-Fund held with related parties of the Trustee amounted to RMB6,898,996 (2014: RMB65,857,789). In addition, the investment balance of the Sub-Fund held with the PRC Custodian amounted to RMB830,424,389 (2014: RMB757,684,628).

For E Fund RMB Mainland China Bond Fund, the total cash and cash equivalents of the Sub-Fund held with related parties of the Trustee amounted to RMB4,875,937 (2014: RMB19,434,437). In addition, the investment balance of the Sub-Fund held with the PRC Custodian amounted to RMB846,551,900 (2014: RMB757,592,294).

(e) Transactions with the Manager

During the year ended 31 December 2015, the Manager disposed 2,041,196 units of E Fund RMB Fixed Income Fund and 10,000 units of E Fund RMB Mainland China Bond Fund and did not hold any units of the Sub-Funds as at 31 December 2015.

As at 31 December 2014, the Manager held 2,041,196 units of E Fund RMB Fixed Income Fund and 10,000 units of E Fund RMB Mainland China Bond Fund, which valued at a total of RMB221,367,700 and of RMB1,038,300 respectively.

(f) Transactions with the Manager’s parent company

E Fund RMB Fixed Income Fund

During the year ended 31 December 2015 and 2014, the Sub-Fund has held units of unlisted collective investment schemes which are managed by E Fund Management Co., Ltd, the parent company of the Manager. The movement of the Sub-Fund’s investment in the unlisted collective investment schemes is as follows:

2015 2014 RMB RMB

At the beginning of the year 1,000,000 20,000,000 Purchase 80,066,989 1,119,590 Sales (50,066,989) (20,119,590) ────────── ────────── At the end of the year 31,000,000 1,000,000 ══════════ ══════════

- 44 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

8 Transactions with the Trustee, Manager and connected persons (Continued)

(f) Transactions with the Manager’s parent company (Continued)

E Fund RMB Mainland China Bond Fund

During the year ended 31 December 2015 and 2014, the Sub-Fund has held units of an unlisted collective investment scheme which is managed by GF Fund Management Co., Ltd, a 25% shareholder of the parent company of the Manager. The movement of the Sub-Fund’s investment in the unlisted collective investment scheme is as follows:

2015 2014 RMB RMB

At the beginning of the year - 4,000,000 Purchase 60,000,000 11,419,515 Sales (60,000,000) (15,419,515) ────────── ────────── At the end of the year - - ══════════ ══════════

During the year ended 31 December 2015, the Sub-Fund has held units of unlisted collective investment schemes which are managed by E Fund Management Co., Ltd, the parent company of the Manager. The movement of the Sub-Fund’s investment in the unlisted collective investment schemes is as follows:

2015 2014 RMB RMB

At the beginning of the year 50,000,000 89,000,000 Purchase 90,174,125 94,071,241 Sales (120,174,125) (133,071,241) ────────── ────────── At the end of the year 20,000,000 50,000,000 ══════════ ══════════

Other than interest earned, there was no gain or loss from the above transactions.

(g) Expenses borne by the Manager

The Manager has borne certain charges, fees and expenses which are attributable to E Fund RMB Mainland China Bond Fund from 19 November 2013 to 18 February 2014. Such expenses were reimbursed to the Sub-Fund subsequently. No expense was borne by the Manager for the year ended 31 December 2015 (2014: RMB367,545).

- 45 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

9 Taxation

Hong Kong Profits Tax

No provision for Hong Kong profits tax has been made for the Sub-Funds as they were authorised as collective investment schemes under Section 104 of the Hong Kong Securities and Futures Ordinance and is therefore exempt from profits tax under Section 26A(1A) of the Hong Kong Inland Revenue Ordinance.

PRC Withholding Tax

For the year ended 31 December 2015 and 2014, the Sub-Funds had invested in RMB denominated A-shares, debt securities and collective investment schemes in PRC. As set out in Note 3, during the year ended 31 December 2015, the Manager has decided to change the tax provisioning policy with E Fund RMB Fixed Income Fund and E Fund RMB Mainland China Bond Fund ceased to provide PRC withholding income tax for realised and unrealised gains on trading of PRC Investments on or after 4 November 2015 and 10 December 2015 respectively. Refer to Note 3 for details.

The taxation of the Sub-Funds for the year ended 31 December 2015 and 2014 represents:

E Fund RMB Fixed Income Fund

2015 2014 RMB RMB

Capital gain tax on realised gains on investments (8,193,450) 3,959,455 Deferred tax (credited)/charged on change in unrealised gains on investments (1,422,606) 294,520 ──────── ──────── (9,616,056) 4,253,975 ------

Withholding tax on interest income 1,257,977 358,384 Withholding tax on dividend income 45,021 44,591 ──────── ──────── 1,302,998 402,975 ------

Taxation (8,313,058) 4,656,950 ════════ ════════

- 46 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

9 Taxation (Continued)

E Fund RMB Mainland China Bond Fund

2015 2014 RMB RMB

Capital gain tax on realised gains of investments (885,607) 876,497 Deferred tax (credited)/charged on change in unrealised gains on investments (190,188) 104,684 ──────── ──────── (1,075,795) 981,181 ------

Withholding tax on interest income 80,757 34,084 ------

Taxation (995,038) 1,015,265 ════════ ════════

The movement in deferred tax liabilities arising from change in unrealised gains on investments during the year is as follows:

E Fund RMB Fixed Income Fund

2015 2014 RMB RMB

At the beginning of the year 1,422,606 1,128,086 Deferred tax (credited)/charged to the statement of comprehensive income (1,422,606) 294,520 ──────── ──────── At the end of the year - 1,422,606 ════════ ════════

E Fund RMB Mainland China Bond Fund

2015 2014 RMB RMB

At the beginning of the year 190,188 85,504 Deferred tax (credited)/charged to the statement of comprehensive income (190,188) 104,684 ──────── ──────── At the end of the year - 190,188 ════════ ════════

- 47 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

9 Taxation (Continued)

The movement in provision for taxation during the year is as follows:

E Fund RMB Fixed Income Fund

2015 2014 RMB RMB

At the beginning of the year 12,164,276 7,893,856 Taxation (credited)/charged to the statement of comprehensive income (6,890,452) 4,362,430 Tax paid (354,078) (92,010) ──────── ──────── At the end of the year 4,919,746 12,164,276 ════════ ════════

E Fund RMB Mainland China Bond Fund

2015 2014 RMB RMB

At the beginning of the year 3,149,256 2,256,485 Taxation (credited)/charged to the statement of comprehensive income (804,850) 910,581 Tax paid (29,642) (17,810) ──────── ──────── At the end of the year 2,314,764 3,149,256 ════════ ════════

- 48 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

10 Cash generated from/(used in) operations

E Fund RMB Fixed E Fund RMB Mainland Income Fund China Bond Fund 2015 2014 2015 2014 RMB RMB RMB RMB

Cash flows from operating activities Profit after tax 119,427,846 97,692,949 53,550,633 48,144,214

Adjustment for: Interest income (51,300,157) (54,723,113) (43,299,365) (51,354,306) Dividend income (402,205) (447,272) - - Taxation (8,313,058) 4,656,950 (995,038) 1,015,265 ────────── ────────── ────────── ───────── Operating gains/(losses) before working capital changes 59,412,426 47,179,514 9,256,230 (2,194,827)

Net (increase)/decrease in investments (102,768,923) 336,854,072 (78,959,606) 120,594,597 Net increase in interest receivable purchased (41,472,433) (40,156,195) (18,586,899) (48,084,007) Net (increase)/decrease in deposit reserve (12,976) 580,192 (4,910) 53,535 Net decrease in other receivable - - - 227,432 Net decrease/(increase) in amounts due from brokers - - 10,206,535 (10,206,535) Net decrease in amounts due to brokers - (5,264,676) - - Net (decrease)/increase in management fee payable (16,781) (301,096) 26,396 87,901 Net increase/(decrease) in trustee fee payable 2,793 (24,681) 5,708 7,128 Net increase/(decrease) in custodian fee payable 2,031 (37,152) 4,151 3,227 Net (decrease)/increase in accrued expenses and other payables (18,242) 165,555 9,284 14,395 ────────── ────────── ────────── ───────── Cash (used in)/generated from operations (84,872,105) 338,995,533 (78,043,111) 60,502,846 ══════════ ══════════ ══════════ ══════════

11 Soft commission arrangements

The Manager confirms that there has been no soft commission arrangement existing during the year ended 31 December 2015 (2014: nil) in relation to directing transactions of the Sub-Funds through a broker or dealer.

- 49 -

E FUND RMB FIXED INCOME FUND E FUND RMB MAINLAND CHINA BOND FUND (Sub-funds of E Fund Investment Fund Series)

NOTES TO THE FINANCIAL STATEMENTS

12 Distribution to unitholders

E Fund RMB Fixed Income Fund

2015 2014 RMB RMB For Class A (distribution) and Class I (distribution) - RMB 4.00 per unit on 9,499,394 units paid on 30 June 2015 37,997,576 - - RMB 4.00 per unit on 7,608,697 units paid on 30 December 2015 30,434,787 - - RMB1.50 per unit on 7,063,045 units paid on 15 July 2014 - 10,594,567 - RMB 3.50 per unit on 7,901,873 units paid on 23 December 2014 - 27,656,557 ───────── ───────── 68,432,363 38,251,124 ═════════ ═════════

E Fund RMB Mainland China Bond Fund

2015 2014 RMB RMB

For Class A (distribution) - RMB 0.40 per unit on 10,529 units paid on 28 January 2015 4,211 - - RMB 0.40 per unit on 12,172 units paid on 27 February 2015 4,869 - - RMB 0.40 per unit on 12,172 units paid on 23 March 2015 4,869 - - RMB 0.40 per unit on 11,536 units paid on 28 April 2015 4,614 - - RMB 0.40 per unit on 11,536 units paid on 27 May 2015 4,614 - - RMB 0.40 per unit on 11,143 units paid on 30 June 2015 4,457 - - RMB 0.40 per unit on 10,695 units paid on 28 July 2015 4,278 - - RMB 0.40 per unit on 17,792 units paid on 26 August 2015 7,117 - - RMB 0.40 per unit on 17,792 units paid on 29 September 2015 7,117 - - RMB 0.40 per unit on 17,792 units paid on 29 October 2015 7,117 - - RMB 0.40 per unit on 17,792 units paid on 27 November 2015 7,117 - - RMB 0.40 per unit on 21,304 units paid on 30 December 2015 8,521 - - RMB0.40 per unit on 103,675 units paid on 27 February 2014 - 41,470 - RMB0.40 per unit on 103,675 units paid on 28 March 2014 - 41,470 - RMB0.40 per unit on 200,307 units paid on 28 April 2014 - 80,123 - RMB0.40 per unit on 199,817 units paid on 28 May 2014 - 79,927 - RMB0.40 per unit on 17,924 units paid on 30 June 2014 - 7,169 - RMB0.40 per unit on 17,924 units paid on 29 July 2014 - 7,169 - RMB0.40 per unit on 17,728 units paid on 28 August 2014 - 7,091 - RMB0.40 per unit on 13,747 units paid on 29 September 2014 - 5,499 - RMB0.40 per unit on 13,747 units paid on 29 October 2014 - 5,499 - RMB0.40 per unit on 13,747 units paid on 27 November 2014 - 5,499 - RMB0.40 per unit on 12,493 units paid on 30 December 2014 - 4,997 ───────── ───────── 68,901 285,913 ═════════ ═════════

13 Approval of financial statements

The financial statements were approved by the Trustee and the Manager on 27 April 2016.

- 50 -

E FUND RMB FIXED INCOME FUND (A sub-fund of E Fund Investment Fund Series)

INVESTMENT PORTFOLIO (UNAUDITED) AS AT 31 DECEMBER 2015

% of Net Investments (97.53%) Holdings Fair Value assets RMB Debt securities (82.91%)

Listed in China

PINGDINGSHAN DEVE INV 05/08/19 13,000,000 11,050,000 1.25 TONGLING CONST INVST 8.20 04/28/22 30,000,000 29,904,000 3.39 SHIYAN INFRASTR CONSTR 6.88 10/11/20 1,999,000 2,098,950 0.24 ZUNYI SOA INV MGT 6.95 05/28/21 20,000,000 20,400,000 2.31 LONGQUANYI ASSET INV LTD 6.90 05/30/21 20,000,000 21,200,000 2.40 DALIAN LVTAI INVESTMENT 7.00 08/08/21 51,000,000 55,425,015 6.28 JIANGSU WANTAO INVT 6.82 09/15/20 30,000,000 32,160,000 3.65 WENZHOU LUCHENG DEVELOPM 5.58 11/03/21 10,000,000 10,297,300 1.17 BLUEFOCUS COMMUNICATION SC 12/18/21 116,000 116,000 0.01 SHANGHAI ST ASST OPE 1.70 12/08/20 125,000 143,675 0.02

Unlisted in China CHINA GOVERNMENT BOND 3.05 10/22/22 8,000,000 8,104,000 0.92 GANZHOU DEV INVESTMENT 8.10 12/11/23 20,000,000 23,592,100 2.67 HENAN TRANSPORT INV GR VAR 03/07/26 50,000,000 63,141,350 7.16 WUXI URBAN DEVELOP 5.68 05/18/25 50,000,000 55,500,600 6.29 SHANXI MOTOR TRANSPORT 6.28 11/05/19 20,000,000 20,782,020 2.36 ULANQAB JI NING DEV 6.88 03/19/20 20,000,000 20,505,360 2.32 LUOYANG TECH INDUSTRIAL 6.50 05/30/20 10,000,000 10,358,390 1.18 BIJIE KAIYUAN CON INV 7.78 02/25/21 50,000,000 55,263,250 6.26 CHIFENG INFRASTRUCTURE I 7.07 06/19/21 50,000,000 54,515,150 6.18 DINGHAI ST ASSET OPE 7.13 08/04/21 50,000,000 54,713,300 6.20 DALIAN LVTAI INVESTMENT 7.00 08/08/21 30,000,000 32,602,950 3.70 SHIYAN INFRASTR CONSTR 6.58 08/20/21 30,000,000 32,307,510 3.66 FENGXI NEW CITY CONST 6.85 08/15/21 20,000,000 21,471,700 2.43 JIANGSU WANTAO INVT 6.82 09/15/20 30,000,000 32,230,800 3.65 YINGTAN INVESTMENT 6.20 10/17/21 40,000,000 42,304,120 4.80 BENXI CONSTR INV DEVELOP 6.24 01/22/22 20,000,000 21,270,800 2.41 ─────────── ─────── 731,458,340 82.91 ------Equity securities (8.48%)

Listed in China

PING AN BANK CO LTD-A 5,305 63,607 0.01 SHENZHEN AIRPORT CO-A 610,800 4,984,128 0.55 WULIANGYE YIBIN CO LTD-A 361,900 9,872,632 1.12 RISESUN REAL ESTATE DEVEL-A 283,800 2,704,614 0.31 ZHEJIANG JIULI HI-TECH-A 937,452 14,343,016 1.63 CHINA MERCHANTS BANK-A 279,400 5,026,406 0.57 WANHUA CHEMICAL GROUP CO -A 107,800 1,924,230 0.22 JIANGSU EXPRESSWAY CO LTD-A 594,800 5,204,500 0.59 KWEICHOW MOUTAI CO LTD-A 33,300 7,265,727 0.82 SHANDONG GOLD MINING CO LT-A 380,800 7,996,800 0.91 CHINA SECURITY & FIRE-A 57,600 1,661,184 0.19 SICHUAN CHUANTOU ENERGY CO-A 663,300 7,137,108 0.81 NEW CHINA LIFE INSURANCE C-A 127,800 6,672,438 0.75 ─────────── ─────── 74,856,390 8.48 ------

- 51 -

E FUND RMB FIXED INCOME FUND (A sub-fund of E Fund Investment Fund Series)

INVESTMENT PORTFOLIO (UNAUDITED) (CONTINUED) AS AT 31 DECEMBER 2015

% of Net Investments (97.53%) (Continued) Holdings Fair Value assets RMB Collective investment schemes (6.14%)

Listed in China1

GUOTAI GZ HEATHCARE INDEX A GZ HC INDEX A 1,000,000 1,073,000 0.12 SWS MU CSI ENVI PROTECTN -A 1,000,000 984,000 0.11 CHINA DEVELOPMENT BANK ST-O STB-I-A 10,000,000 9,440,000 1.07 CHINA DEVELOPMENT BANK CSI ALL SH-ST 1,636,800 1,811,938 0.21 E FUND SWIFT CASH MONEY MARKET-A 10,000 1,000,100 0.11 FULLGOAL NEW TIANFONG BOND 1,639,962 1,679,321 0.19 ICBC CREDIT SUISSE PURE BOND 6,567,326 7,086,145 0.80 FORTUNE SGAM MONEY MKT FUND 10,350 1,035,155 0.12

Unlisted in China1 E FUND MONEY MARKET FUND-B 30,000,000 30,000,000 3.40 FG CSI ALL SHARE SECU INDE-M 23,108 29,162 0.01 ─────────── ─────── 54,138,821 6.14 ------

Total investments 860,453,551 97.53 ------

Other net assets 21,819,621 2.47 ─────────── ─────── Total net assets as at 31 December 2015 (before amortisation of establishment costs) 882,273,172 100.00 ═══════════ ═══════

Total investments at cost 834,394,206 ═══════════

1 Not authorised in Hong Kong and not available to Hong Kong Residents.

- 52 -

E FUND RMB FIXED INCOME FUND (A sub-fund of E Fund Investment Fund Series)

STATEMENT OF MOVEMENTS IN INVESTMENT PORTFOLIO (UNAUDITED) FOR THE YEAR ENDED 31 DECEMBER 2015

Holdings 2014 Additions Disposals 2015 Investments PING AN BANK CO LTD-A - 5,305 - 5,305 CHINA VANKE CO LTD -A - 1,017,700 1,017,700 - SHENZHEN AIRPORT CO-A - 610,800 - 610,800 TCL CORP-A - 690,000 690,000 - MIDEA GROUP CO LTD-A 95,450 196,951 292,401 - GUANGZHOU LINGNAN GROUP -A 226,000 100,000 326,000 - GUANGDONG ELEC POWER DEV-A - 348,000 348,000 - JIANGLING MOTORS CORP LTD-A - 386,071 386,071 - JILIN AODONG PHARMACEUTICA-A 83,500 - 83,500 - SHANDONG XINHUA PHARM CO-A - 351,600 351,600 - FAW CAR COMPANY LIMITED-A - 359,982 359,982 - WULIANGYE YIBIN CO LTD-A - 361,900 - 361,900 BEIJING SHUNXIN AGRICULT-A 145,800 - 145,800 - VATTI CORPORATION LTD-A - 273,400 273,400 - DYMATIC CHEMICALS INC - A 191,400 - 191,400 - RISESUN REAL ESTATE DEVEL-A - 283,800 - 283,800 ZHEJIANG JIULI HI-TECH-A 329,271 1,267,852 659,671 937,452 GUANGDONG DELIAN GROUP CO -A - 240,000 240,000 - CHANGZHOU NRB CORP-A - 150,000 150,000 - MUYUAN FOODSTUFF CO LTD-A 33,000 80,910 113,910 - GUOSEN SECURITIES CO LTD-A 6,000 - 6,000 - SUNFLOWER PHARMACEUTICAL-A 500 - 500 - SHENZHEN IDEAL JEWELLERY C-A - 500 500 - CHONGQING SANSHENG SPECIAL-A - 500 500 - ANHUI FUHUANG STEEL STRUCT-A - 500 500 - MLS CO LTD-A - 500 500 - CHINA DEVELOPMENT BANK 5.8 01/03/16 - 1,500,000 1,500,000 - BEIJING GEHUA CATV NETWO SC 11/25/16 2,000,000 6,472,000 8,472,000 - SHANDONG NANSHAN INDUSTR VAR 10/16/18 13,858,000 - 13,858,000 - CHINA MINSHENG BKG CORP VAR 03/15/19 5,000,000 - 5,000,000 - DONGFANG ELECTRIC 0.5SC 7/10/20 3,328,000 8,000,000 11,328,000 - AISINO CORP SC 06/12/21 - 58,000 58,000 - SHENZHEN GAS CORP VAR 12/13/19 1,928,000 - 1,928,000 - SHANGHAI ELECTRIC GROUP SC 02/02/21 - 426,000 426,000 - CHINA MOLYBDENUM CO LTD SC 12/02/20 1,126,000 - 1,126,000 - CHINA TRAVEL SERVICE HK 4.95 01/13/18 - 10,000,000 10,000,000 - XINHU ZHONGBAO 9 07/02/16 73,825,000 97,174,000 170,999,000 - WEIQIAO TEXTILE CO LTD-H VAR 11/07/19 20,000,000 - 20,000,000 - PINGDINGSHAN DEVE INV 7.86 05/08/19 13,000,000 13,000,000 13,000,000 13,000,000 TONGLING CONST INVST 8.20 04/28/22 - 30,000,000 - 30,000,000 PANJIN CONSTRUCTION INV 7.50 05/17/19 - 50,000,000 50,000,000 - BLUEFOCUS COMMUNICATION SC 12/18/21 - 116,000 - 116,000 SHIYAN INFRASTR CONSTR 6.88 10/11/20 - 2,000,000 1,000 1,999,000 SHANDONG HONGQIAO NEW MA 8.69 03/03/21 20,000,000 20,000,000 40,000,000 - NINGBO HAISHU ASST 7.75 03/06/21 50,000,000 20,000,000 70,000,000 - CZ URBAN CONSTR INV 7.29 04/16/21 - 80,000,000 80,000,000 - ZUNYI SOA INV MGT 6.95 05/28/21 - 40,000,000 20,000,000 20,000,000 XIAOGAN CONSTR INV CORP 6.89 05/29/21 10,000,000 10,000,000 20,000,000 - LONGQUANYI ASSET INV LTD 6.90 05/30/21 20,000,000 - - 20,000,000 DALIAN LVTAI INVESTMENT 7.00 08/08/21 - 102,000,000 51,000,000 51,000,000

- 53 -

E FUND RMB FIXED INCOME FUND (A sub-fund of E Fund Investment Fund Series)

STATEMENT OF MOVEMENTS IN INVESTMENT PORTFOLIO (UNAUDITED) FOR THE YEAR ENDED 31 DECEMBER 2015

Holdings 2014 Additions Disposals 2015 Investments JIANGSU WANTAO INVT 6.82 09/15/20 - 30,000,000 - 30,000,000 BEIJING YANJING BREWERY VAR 10/15/15 2,000,000 - 2,000,000 - WENZHOU LUCHENG DEVELOPM 5.58 11/03/21 - 20,000,000 10,000,000 10,000,000 CHANGQING AGROCHEMCL CO 0.6SC 6/20/20 1,944,800 - 1,944,800 - XIAOGAN CONSTR INV CORP 8.12 03/26/19 40,000,000 - 40,000,000 - TONGDING INTERCONNECTION SC 08/15/20 221,000 - 221,000 - BAOTOU STATE OWNED ASSET 7.03 09/17/19 30,000,000 - 30,000,000 - SHANXI MOTOR TRANSPORT 6.28 11/05/19 30,000,000 20,000,000 30,000,000 20,000,000 CHINA NATL PETROLEUM CO 4.35 05/17/17 - 60,000,000 60,000,000 - TSINGHUA HOLDINGS CO LTD 1.00 10/26/18 - 86,000 86,000 - SHANGHAI GUOSHENG GROUP 1.00 11/05/21 - 168,000 168,000 - SHANGHAI ST ASST OPE 1.70 12/08/20 - 125,000 - 125,000 GANZHOU DEV INVESTMENT 8.10 12/11/23 - 40,000,000 20,000,000 20,000,000 GANGZHA STATE OWN ASSET 7.15 01/09/20 30,000,000 30,000,000 60,000,000 - ULANQAB JI NING DEV 6.88 03/19/20 20,000,000 20,000,000 20,000,000 20,000,000 ZHANGZHOU CONSTR INV 6.60 03/26/20 20,000,000 20,000,000 40,000,000 - LUOYANG TECH INDUSTRIAL 6.50 05/30/20 10,000,000 10,000,000 10,000,000 10,000,000 CHINA DEVELOPMENT BANK 5.79 01/14/21 - 20,000,000 20,000,000 - CHINA DEVELOPMENT BANK 5.44 04/08/19 - 30,000,000 30,000,000 - CHINA DEVELOPMENT BANK 4.19 09/15/15 - 30,000,000 30,000,000 - HUADIAN POWER INTERNATIO 4.65 08/07/15 - 50,000,000 50,000,000 - LUKOU INTL AIRPORT 5.20 09/23/15 - 10,000,000 10,000,000 - HANGZHOU INDUSTRIAL INV 5.08 09/25/15 5,000,000 - 5,000,000 - TIANJIN CITY CONSTRUCTIO 5.90 03/19/15 30,000,000 - 30,000,000 - HENAN TRANSPORT INV GR VAR 03/07/26 - 50,000,000 - 50,000,000 TANGSHAN JIDONG CEMENT C 5.48 04/23/15 - 20,000,000 20,000,000 - BEIJING INFRASTRUCTURE 4.24 08/14/15 5,000,000 - 5,000,000 - BIJIE KAIYUAN CON INV 7.78 02/25/21 - 50,000,000 - 50,000,000 FENGNAN CONSTRUCTION & I 7.23 05/30/21 50,000,000 50,000,000 100,000,000 - CHIFENG INFRASTRUCTURE I 7.07 06/19/21 50,000,000 50,000,000 50,000,000 50,000,000 DINGHAI ST ASSET OPE 7.13 08/04/21 - 50,000,000 - 50,000,000 DALIAN LVTAI INVESTMENT 7.00 08/08/21 - 60,000,000 30,000,000 30,000,000 SHIYAN INFRASTR CONSTR 6.58 08/20/21 60,000,000 - 30,000,000 30,000,000 FENGXI NEW CITY CONST 6.85 08/15/21 40,000,000 20,000,000 40,000,000 20,000,000 JIANGSU WANTAO INVT 6.82 09/15/20 - 60,000,000 30,000,000 30,000,000 YINGTAN INVESTMENT 6.20 10/17/21 - 40,000,000 - 40,000,000 ANHUI PROV ENERGY GROUP 4.90 05/19/15 5,000,000 - 5,000,000 - JIANGSU GUOXIN INVESTMEN 4.79 03/29/15 5,000,000 - 5,000,000 - CHINA GOVERNMENT BOND 3.36 01/22/22 - 10,000,000 10,000,000 - CHINA GOVERNMENT BOND 3.05 10/22/22 - 8,000,000 - 8,000,000 GUOTAI GZ HEATHCARE INDEX A GZ HC INDEX A - 1,000,000 - 1,000,000 CITIC-PRU CSI800 N-FER MT-A - 5,000,000 5,000,000 - FULLGOAL CHINEXT PRICE INX-A - 20,000,000 20,000,000 - CITIC-PRUDENTIAL CSI 800-A - 11,000,000 11,000,000 - SWS MU CSI SWS SEC IND CLS-A - 10,000,000 10,000,000 - SWS MU CSI ENVI PROTECTN -A - 1,000,000 - 1,000,000 CHINA DEVELOPMENT BANK 3.64 02/05/16 - 130,000,000 130,000,000 - CHINA DEVELOPMENT BANK 3.76 02/05/20 - 190,000,000 190,000,000 - CHINA DEVELOPMENT BANK 3.86 02/05/22 - 50,000,000 50,000,000 - CHINA DEVELOPMENT BANK ST-O STB-I-A - 10,000,000 - 10,000,000

- 54 -

E FUND RMB FIXED INCOME FUND (A sub-fund of E Fund Investment Fund Series)

STATEMENT OF MOVEMENTS IN INVESTMENT PORTFOLIO (UNAUDITED) FOR THE YEAR ENDED 31 DECEMBER 2015

Holdings 2014 Additions Disposals 2015 Investments CHINA DEVELOPMENT BANK 4.21 04/13/25 - 20,000,000 20,000,000 - CHINA DEVELOPMENT BANK 3.19 05/12/16 - 130,000,000 130,000,000 - CHINA DEVELOPMENT BANK FULLGOAL CSI N - 3,176,671 3,176,671 - CHINA DEVELOPMENT BANK 3.94 07/10/22 - 13,000,000 13,000,000 - CHINA DEVELOPMENT BANK CSI HLTH-A - 3,000,000 3,000,000 - CHINA DEVELOPMENT BANK CSI ALL SH-ST - 80,999,980 79,363,180 1,636,800 EXPORT-IMPORT BANK CHINA 3.85 01/26/20 - 30,000,000 30,000,000 - CHINA MERCHANTS GROUP 2.97 04/25/16 - 50,000,000 50,000,000 - CHINA EASTERN AIR 4.80 11/10/15 - 5,000,000 5,000,000 - HUNAN PROVINCIAL EXPRESS 4.30 06/15/16 - 30,000,000 30,000,000 - YANCHENG ORIENTAL INVEST 5.55 03/09/16 - 40,000,000 40,000,000 - SHANGHAI ELECTRIC POWER 4.55 10/14/15 - 50,000,000 50,000,000 - WUXI URBAN DEVELOP 5.68 05/18/25 - 50,000,000 - 50,000,000 BENXI CONSTR INV DEVELOP 6.24 01/22/22 - 20,000,000 - 20,000,000 ZHAOY 3.60 09/26/16 - 10,000,000 10,000,000 - E FUND SWIFT CASH MONEY MARKET-A 10,000 - - 10,000 SHANXI LUAN MINING GROUP 5.30 10/27/15 - 40,000,000 40,000,000 - FULLGOAL NEW TIANFONG BOND 1,867,562 - 227,600 1,639,962 ICBC CREDIT SUISSE PURE BOND 7,047,826 - 480,500 6,567,326 BLUEFOCUS COMMUNICATION GR-A - 150,737 150,737 - LEYARD OPTOELECTRONIC CO L-A 60,000 36,000 96,000 - JIANGMEN IDEAR HANYU ELEC-A - 50,000 50,000 - JIANGSU LIXING GENERAL STE-A - 500 500 - NINGBO MEDICAL SYSTEM BIOT-A - 500 500 - BEIJING CTROWELL TECHNOLOG-A - 500 500 - ALL WINNER TECHNOLOGY CO L-A - 500 500 - FUXIN DARE AUTOMOTIVE PART-A - 500 500 - BEIJING HEZONG SCIENCE & T-A - 500 500 - SHANXI ORIENTAL MATERIAL H-A - 500 500 - EST TOOLS CO LTD-A - 500 500 - CHINA AMC CSI 300 INDEX ETF AMC CSI300 - 2,311,960 2,311,960 - FORTUNE SGAM MONEY MKT FUND 10,034 316 - 10,350 WUHAN IRON & STEEL CO LTD-A - 1,250,000 1,250,000 - CHINA MINSHENG BANKING-A - 260,000 260,000 - CHINA MERCHANTS BANK-A - 279,400 - 279,400 BEIJING GEHUA CATV NETWORK-A 117,000 597,400 714,400 - HENAN YINGE INDUSTRIAL INV-A 400,000 - 400,000 - SICHUAN HEJIA CO-A - 400,000 400,000 - SINOLINK SECURITIES CO LTD-A 75,000 - 75,000 - GREE REAL ESTATE CO LTD-A - 88,965 88,965 - WANHUA CHEMICAL GROUP CO -A 200,000 301,905 394,105 107,800 SINOMACH AUTOMOBILE CO LTD-A - 234,901 234,901 - CHINA FORTUNE LAND DEVELOP-A - 32,000 32,000 - CHINA UNITED TRAVEL CO LTD-A - 600,000 600,000 - JIANGSU EXPRESSWAY CO LTD-A - 594,800 - 594,800 JIANGXI HONGCHENG WATERWOR-A 60,000 - 60,000 - KWEICHOW MOUTAI CO LTD-A - 44,272 10,972 33,300 SHANDONG GOLD MINING CO LT-A - 380,800 - 380,800 ATLANTIC CHINA WELDING CON-A 117,000 - 117,000 - CHINA SECURITY & FIRE-A - 57,600 - 57,600

- 55 -

E FUND RMB FIXED INCOME FUND (A sub-fund of E Fund Investment Fund Series)

STATEMENT OF MOVEMENTS IN INVESTMENT PORTFOLIO (UNAUDITED) FOR THE YEAR ENDED 31 DECEMBER 2015

Holdings 2014 Additions Disposals 2015 Investments SICHUAN CHUANTOU ENERGY CO-A - 1,495,800 832,500 663,300 XI'AN QUJIANG CULTURAL TO-A 213,300 100,000 313,300 - TIANJIN PORT CO LTD-A - 180,000 180,000 - ORIENT GROUP INC.-A 280,000 - 280,000 - SHAANXI BROADCAST & TV NET-A - 150,000 150,000 - HAITONG SECURITIES CO LTD-A 80,000 - 80,000 - DONGFANG ELECTRIC CORP LTD-A - 944,000 944,000 - INNER MONGOLIA YILI INDUS-A - 99,938 99,938 - ORIENT SECURITIES CO LTD-A - 4,000 4,000 - JIANGSU BROADCASTING CABLE-A - 1,000 1,000 - WESTERN REGION GOLD CO LTD-A - 2,000 2,000 - CHINA HAINAN RUBBER INDUST-A 200,000 - 200,000 - SHENZHEN GAS CORP LTD-A - 231,730 231,730 - CHONGQING WATER GROUP-A 90,000 170,000 260,000 - INDUSTRIAL BANK CO LTD -A - 200,000 200,000 - DONGXING SECURITIES CO LT-A - 3,000 3,000 - GUOTAI JUNAN SECURITIES CO-A - 10,000 10,000 - BANK OF COMMUNICATIONS CO-A 150,000 - 150,000 - NEW CHINA LIFE INSURANCE C-A - 227,328 99,528 127,800 ZHENGZHOU COAL MINING MACH-A 193,500 - 193,500 - CHINA NATIONAL NUCLEAR POW-A - 19,000 19,000 - BBMG CORPORATION-A 130,000 - 130,000 - PEOPLE.CN CO LTD-A 36,000 - 36,000 - SHANGHAI CHUANGLI GROUP CO-A - 1,000 1,000 - BEIJING DAHAO TECHNOLOGY C-A - 1,000 1,000 - SHANGHAI TRENDZONE CONSTRU-A - 1,000 1,000 - SHENZHEN GONGJIN ELECTRONI-A - 81,000 81,000 - ZHEJIANG JASAN HOLDING GRO-A - 1,000 1,000 - HANGZHOU CABLE CO LTD-A - 1,000 1,000 - QUMEI HOME FURNISHINGS GRP-A - 1,000 1,000 - LAOBAIXING PHARMACY CHAIN-A - 91,500 91,500 - E FUND MONEY MARKET FUND-B - 80,066,989 50,066,989 30,000,000 FG CSI ALL SHARE SECU INDE-M - 23,108 - 23,108

- 56 -

E FUND RMB FIXED INCOME FUND (A sub-fund of E Fund Investment Fund Series)

PERFORMANCE TABLE (UNAUDITED) FOR THE YEAR ENDED 31 DECEMBER 2015

Net asset values

Net asset Net asset value value per unit RMB

At 31 December 2015 (Dealing NAV) Class A RMB (accumulation) 1,555,352 RMB120.99 Class A RMB (distribution) 210,939,886 RMB112.82 Class A USD (accumulation) 8,204,577 USD11.41 Class I RMB (distribution) 661,573,357 RMB115.24 ══════════ ═════════

At 31 December 2014 (Dealing NAV) Class A RMB (distribution) 280,169,833 RMB106.84 Class A USD (accumulation) 799,736 USD10.68 Class I RMB (distribution) 553,102,661 RMB108.45 ══════════ ═════════

At 31 December 2013 (Dealing NAV) Class A RMB (distribution) 718,817,645 RMB99.88 Class I RMB (distribution) 406,577,987 RMB100.88 ══════════ ═════════

At 31 December 2012 (Dealing NAV) Class A RMB (distribution) 665,196,275 RMB103.91 Class I RMB (distribution) 459,402,704 RMB104.43 ══════════ ═════════

Highest and lowest net asset value per unit (Dealing NAV)

Highest net Lowest net asset value asset value per unit per unit

At 31 December 2015 (Dealing NAV) Class A RMB (accumulation) RMB121.08 RMB114.65 Class A RMB (distribution) RMB117.42 RMB107.22 Class A USD (accumulation) USD11.73 USD10.69 Class I RMB (distribution) RMB119.46 RMB108.84 Class I USD (accumulation) USD 12.33 USD11.51 ══════════ ═════════

At 31 December 2014 (Dealing NAV) Class A RMB (distribution) RMB110.40 RMB99.34 Class A USD (accumulation) USD10.68 USD10.57 Class I RMB (distribution) RMB112.02 RMB100.36 ══════════ ═════════

At 31 December 2013 (Dealing NAV) Class A RMB (distribution) RMB104.59 RMB99.32 Class I RMB (distribution) RMB105.33 RMB100.30 ══════════ ═════════

At 31 December 2012 (Dealing NAV) Class A RMB (distribution) RMB103.91 RMB99.99 Class I RMB (distribution) RMB104.43 RMB100.00 ══════════ ═════════

- 57 -

E FUND RMB MAINLAND CHINA BOND FUND (A sub-fund of E Fund Investment Fund Series)

INVESTMENT PORTFOLIO (UNAUDITED) AS AT 31 DECEMBER 2015

% of Net Investments (97.59%) Holdings Fair Value assets RMB Debt securities (93.19%)

Listed in China

ZHUJI CONSTR INV DEVE 6.92 07/05/18 12,000,000 12,502,800 1.38 SANMENXIA CITY FIN INVST VAR 04/25/18 9,999,000 10,478,952 1.15 DAFENG CONST ST OWN AST 7.08 12/13/19 30,000,000 25,200,000 2.77

Unlisted in China HEBEI IRON & STEEL GROUP 5.25 02/05/16 28,000,000 28,033,516 3.09 BAOSHAN IRON & STEEL 3.18 10/26/16 45,000,000 45,080,550 4.96 CQ JIANGBEIZUI DEV & INV 4.20 05/11/16 30,000,000 30,116,730 3.32 JINGMEI GROUP 4.35 05/08/16 20,000,000 20,001,180 2.20 STATE NUCLEAR POWER 3.76 05/11/16 30,000,000 30,090,870 3.31 NINGBO CONSTR INVEST HLD 4.10 05/11/16 20,000,000 20,070,820 2.21 HANGZHOU MUNICIPAL CONST 3.00 12/25/16 36,000,000 35,956,008 3.96 CHINA NATIONAL NUCLEAR 2.96 09/06/16 48,000,000 48,061,584 5.29 CHINA TRAVEL SERVICE HK 4.95 01/13/18 20,000,000 20,737,360 2.28 ALUMINUM CORP OF CHINA VAR 09/09/16 20,000,000 20,268,180 2.23 CHINA RAILWAY CORP 4.65 3/8/2017 40,000,000 40,814,920 4.49 CHINA WATER INVST 5.50 04/26/17 30,000,000 30,832,410 3.40 CHINA NATIONAL PETROLEUM CORP 4.35 5/17/2017 20,000,000 20,393,400 2.25 CHINA SOUTHERN POWER 4.61 10/25/17 30,000,000 30,910,800 3.40 CHINA THREE GORGES CORP 4.60 07/19/18 20,000,000 20,815,600 2.29 WENZH PUBLIC UTILITS INV 6.54 10/14/18 20,000,000 21,499,980 2.37 CRRC GROUP CO LTD 4.93 02/20/18 30,000,000 31,204,620 3.44 CHINA NATL PETROLEUM CO 4.47 02/22/18 50,000,000 51,637,350 5.68 STATE GRID CORP CHINA 4.65 03/21/18 20,000,000 20,751,080 2.28 SHENZHEN AIRLINES 4.50 11/06/17 20,000,000 20,443,120 2.25 CHINA SHENHUA ENERGY CO LTD 5.1 8/21/2017 30,000,000 30,969,810 3.41 CHINA NORTH INDU GROUP 5.05 09/15/17 50,000,000 51,725,200 5.70 CHINA SOUTH INDUSTRY GRP 4.66 12/30/17 30,000,000 30,980,550 3.41 SUTONG BRIDGE 5.95 06/24/19 20,000,000 21,411,400 2.36 CHINA MERCHANTS GROUP LTD 5.2 9/4/2017 10,000,000 10,363,890 1.14 DONGYANG ST ASSET INV VAR 12/14/17 10,000,000 10,491,170 1.15 SHENYANG SUJIATUN CON 6.40 06/20/20 10,000,000 10,543,410 1.16 TANGSHAN URBAN CONS INV 7.10 02/26/21 40,000,000 44,164,640 4.86 ─────────── ─────── 846,551,900 93.19 ------

- 58 -

E FUND RMB MAINLAND CHINA BOND FUND (A sub-fund of E Fund Investment Fund Series)

INVESTMENT PORTFOLIO (UNAUDITED) (CONTINUED) AS AT 31 DECEMBER 2015

% of Net Investments (97.59%) (Continued) Holdings Fair Value assets RMB Collective investment schemes (4.40%)

Unlisted in China1 E FUND MONEY MARKET FUND-B 20,000,000 20,000,000 2.20 SWS MU SY MONEY MARKET FUND - B 20,000,000 20,000,000 2.20 ─────────── ─────── 40,000,000 4.40 ------

Total investments 886,551,900 97.59 ------

Other net assets 21,837,943 2.41 ─────────── ───────

Total net assets as at 31 December 2015 (before amortisation of establishment costs) 908,389,843 100.00 ══════════ ═══════

Total investments at cost 877,528,601 ══════════

1 Not authorised in Hong Kong and not available to Hong Kong Residents.

- 59 -

E FUND RMB MAINLAND CHINA BOND FUND (A sub-fund of E Fund Investment Fund Series)

STATEMENT OF MOVEMENTS IN INVESTMENT PORTFOLIO (UNAUDITED) FOR THE YEAR ENDED 31 DECEMBER 2015

Holdings 2014 Additions Disposals 2015 Investments CHINA MERCHANTS GROUP LTD 5.2 9/4/2017 10,000,000 10,000,000 10,000,000 10,000,000 DONGYANG ST ASSET INV VAR 12/14/17 - 20,000,000 10,000,000 10,000,000 SHINDOO CHEMICAL INDUSTRY CO LTD 7.35 3/8/2017 2,000,000 - 2,000,000 - ZHEJIANG DUN'AN ARTIFICIAL ENVIRONMENT CO LTD 5.7 7/27/2017 30,000,000 25,000,000 55,000,000 - CHINA TRAVEL SERVICE HK 4.95 01/13/18 - 20,000,000 - 20,000,000 CHINA NATIONAL PETROLEUM CORP 4.9 3/24/2016 30,000,000 - 30,000,000 - CHINA RAILWAY CORP 4.98 5/20/2016 40,000,000 - 40,000,000 - ALUMINUM CORP OF CHINA VAR 09/09/16 - 20,000,000 - 20,000,000 CHINA HUADIAN CORP 5.28 11/30/2016 20,000,000 - 20,000,000 - XINHU ZHONGBAO CO LTD 9 7/2/2016 55,191,000 55,000,000 110,191,000 - NEIJIANG INVESTMENT 7.00 07/19/18 - 20,000,000 20,000,000 - ZHUJI CONSTR INV DEVE 6.92 07/05/18 - 12,000,000 - 12,000,000 SANMENXIA CITY FIN INVST VAR 04/25/18 - 9,999,000 - 9,999,000 PANJIN CONSTRUCTION INVESTMENT DEVELOPMENT CO LTD 7.42 3/1/2018 10,000,000 - 10,000,000 - DAFENG CONST ST OWN AST 7.08 12/13/19 - 60,000,000 30,000,000 30,000,000 SUQIAN WATER CONSTRUCTION INVESTMENT CO LTD 6.55 12/4/2019 30,000,000 - 30,000,000 - CHINA RAILWAY CORP 4.65 3/8/2017 40,000,000 40,000,000 40,000,000 40,000,000 CHINA WATER INVST 5.50 04/26/17 - 60,000,000 30,000,000 30,000,000 CHINA NATIONAL PETROLEUM CORP 4.35 5/17/2017 50,000,000 50,000,000 80,000,000 20,000,000 BRIGHT FOOD GROUP CO LTD 5.23 9/27/2015 30,000,000 - 30,000,000 - CHINA SOUTHERN POWER 4.61 10/25/17 - 60,000,000 30,000,000 30,000,000 CHINT GROUP CORP LTD 5.8 12/12/2015 10,000,000 - 10,000,000 - CHINA THREE GORGES CORP 4.60 07/19/18 - 20,000,000 - 20,000,000 WENZH PUBLIC UTILITS INV 6.54 10/14/18 - 20,000,000 - 20,000,000 CHINA POWER INVESTMENT CORP 5.3 9/17/2016 10,000,000 10,000,000 20,000,000 - SHENYANG SUJIATUN CON 6.40 06/20/20 - 10,000,000 - 10,000,000 CRRC GROUP CO LTD 4.93 02/20/18 - 60,000,000 30,000,000 30,000,000 CHINA NATL PETROLEUM CO 4.47 02/22/18 - 50,000,000 - 50,000,000 STATE GRID CORP CHINA 4.65 03/21/18 - 40,000,000 20,000,000 20,000,000 CHINA POWER INVESTMENT CORP 4.65 5/12/2015 20,000,000 - 20,000,000 - HUANENG POWER INTERNATIONAL INC 4.63 5/22/2015 5,000,000 - 5,000,000 - COFCO CORP 4.7 3/16/2015 5,000,000 - 5,000,000 - QINGDAO PORT GROUP CO LTD 5.28 1/19/2015 50,000,000 - 50,000,000 - NINGBO PORT CO LTD 4.85 8/22/2015 5,000,000 - 5,000,000 - SHENZHEN AIRLINES 4.50 11/06/17 - 40,000,000 20,000,000 20,000,000 STATE GRID CORP OF CHINA 4.84 6/11/2017 20,000,000 - 20,000,000 - CHINA SHENHUA ENERGY CO LTD 5.1 8/21/2017 30,000,000 30,000,000 30,000,000 30,000,000 CHINA YANGTZE POWER CO LTD 4.65 8/14/2015 5,000,000 - 5,000,000 - CHINA NORTH INDU GROUP 5.05 09/15/17 - 100,000,000 50,000,000 50,000,000 CHINA SOUTH INDUSTRY GRP 4.66 12/30/17 - 60,000,000 30,000,000 30,000,000 SH NANHUI DEVE GR 4.48 11/26/15 - 10,000,000 10,000,000 -

- 60 -

E FUND RMB MAINLAND CHINA BOND FUND (A sub-fund of E Fund Investment Fund Series)

STATEMENT OF MOVEMENTS IN INVESTMENT PORTFOLIO (UNAUDITED) FOR THE YEAR ENDED 31 DECEMBER 2015

Holdings 2014 Additions Disposals 2015 Investments BBMG CORP 6.5 1/24/2015 20,000,000 - 20,000,000 - SHANDONG GOLD GROUP CO LTD 4.83 8/8/2015 5,000,000 - 5,000,000 - SIIC SHANGHAI HOLDINGS CO LTD 4.3 11/19/2015 5,000,000 - 5,000,000 - BAOTOU IRON AND STEEL GROUP CO LTD 6.99 1/27/2015 20,000,000 - 20,000,000 - CHINA DATANG CORP RENEWABLE POWER CO LTD 4.9 6/12/2015 20,000,000 - 20,000,000 - QINGHAI STATE ASSET INV 5.00 10/10/15 - 5,000,000 5,000,000 - JIANGSU COMMUNICATIONS HOLDING CO LTD 4.49 4/22/2015 5,000,000 - 5,000,000 - DAQIN RAILWAY CO 4.39 08/23/15 - 3,000,000 3,000,000 - SUTONG BRIDGE 5.95 06/24/19 - 20,000,000 - 20,000,000 ALUMINUM CORP OF CHINA 5.20 06/26/15 - 50,000,000 50,000,000 - CHINA NATL GOLD GROUP 4.90 09/05/15 - 60,000,000 60,000,000 - TIANJIN INFRASTRUCTURE CONSTRUCTION & INVESTMENT GROUP CO LTD 5.9 3/19/2015 5,000,000 - 5,000,000 - CHINA POWER INVESTMENT CORP 5.1 8/15/2017 20,000,000 20,000,000 40,000,000 - UNITED INVESTMENT GROUP 4.13 11/13/15 - 5,000,000 5,000,000 - HANGZHOU COMMUNICATIONS 4.43 10/31/15 - 5,000,000 5,000,000 - BEIJING JINGCHENG MACHINERY ELECTRIC HOLDING CO LTD 5.6 3/6/2015 40,000,000 - 40,000,000 - BEIJING DRAINAGE GROUP CO LTD 4.88 8/8/2015 5,000,000 - 5,000,000 - SHANDONG HI-SPEED GROUP CO LTD 4.95 5/15/2015 50,000,000 - 50,000,000 - SHAANXI COAL AND CHEMICA 4.44 07/31/15 - 15,000,000 15,000,000 - TANGSHAN URBAN CONS INV 7.10 02/26/21 - 40,000,000 - 40,000,000 NINGBO CITY HAISHU GUANGJU ASSET OPERATION CO LTD 7.75 3/6/2021 20,000,000 - 20,000,000 - SHIYAN CITY INFRASTRUCTURE CONSTRUCTION INVESTMENT CO LTD 6.58 8/20/2021 30,000,000 - 30,000,000 - STATE POWER INVESTMENT 3.29 05/28/16 - 30,000,000 30,000,000 - COFCO CORP 4.60 09/07/15 - 15,000,000 15,000,000 - CHINA POWER CONSTR 4.55 03/12/16 - 15,000,000 15,000,000 - WENGFU GROUP 4.94 04/21/16 - 10,000,000 10,000,000 - WUHAN IRON & STEEL GROUP 4.83 01/15/16 - 60,000,000 60,000,000 - HEBEI IRON & STEEL GROUP 5.25 02/05/16 - 48,000,000 20,000,000 28,000,000 CHINA GUODIAN CORP 4.08 04/22/16 - 30,000,000 30,000,000 - BAOSHAN IRON & STEEL 3.18 10/26/16 - 45,000,000 - 45,000,000 STATE GRID CORP CHINA 3.40 06/16/16 - 25,000,000 25,000,000 - CHINA ELECTRONICS CORP 4.70 11/10/15 - 5,000,000 5,000,000 - BAOTOU IRON & STEEL GRP 4.78 04/30/16 - 30,000,000 30,000,000 - CHINA EASTERN AIR 4.80 11/10/15 - 10,000,000 10,000,000 - CQ JIANGBEIZUI DEV & INV 4.20 05/11/16 - 30,000,000 - 30,000,000 YANCHENG ORIENTAL INVEST 5.55 03/09/16 - 10,000,000 10,000,000 - JINGMEI GROUP 4.35 05/08/16 - 20,000,000 - 20,000,000 STATE NUCLEAR POWER 3.76 05/11/16 - 30,000,000 - 30,000,000 NINGBO CONSTR INVEST HLD 4.10 05/11/16 - 20,000,000 - 20,000,000

- 61 -

E FUND RMB MAINLAND CHINA BOND FUND (A sub-fund of E Fund Investment Fund Series)

STATEMENT OF MOVEMENTS IN INVESTMENT PORTFOLIO (UNAUDITED) FOR THE YEAR ENDED 31 DECEMBER 2015

Holdings 2014 Additions Disposals 2015 Investments HANGZHOU MUNICIPAL CONST 3.00 12/25/16 - 36,000,000 - 36,000,000 YANKUANG GROUP CORP 5.35 09/25/15 - 8,000,000 8,000,000 - JIANGSU COMMUN HOLDING 4.83 11/09/15 - 40,000,000 40,000,000 - BEIJING ENERGY GROUP 3.95 02/02/16 - 10,000,000 10,000,000 - CHINA NATIONAL NUCLEAR 2.96 09/06/16 - 48,000,000 - 48,000,000 ICBC CREDIT SUISSE PURE BOND FUND 1,300,646 - 1,300,646 - E FUND MONEY MARKET FUND-B 50,000,000 90,174,125 120,174,125 20,000,000 GF MONEY MARKET FUND - B - 60,000,000 60,000,000 - SWS MU SY MONEY MARKET FUND - B - 20,000,000 - 20,000,000

- 62 -

E FUND RMB MAINLAND CHINA BOND FUND (A sub-fund of E Fund Investment Fund Series)

PERFORMANCE TABLE (UNAUDITED) FOR THE YEAR ENDED 31 DECEMBER 2015

Net asset values

Net asset Net asset value value per unit RMB

At 31 December 2015 (Dealing NAV) Class A RMB (accumulation) 535,028 RMB108.87 Class A RMB (distribution) 2,102,055 RMB98.66 Class A HKD(accumulation) 420 HKD105.93 Class I RMB (accumulation) 905,752,340 RMB110.14 ══════════ ═════════

At 31 December 2014 (Dealing NAV) Class A RMB (accumulation) 152,319 RMB103.14 Class A RMB (distribution) 1,226,096 RMB98.14 Class I RMB (accumulation) 854,835,730 RMB103.83 ══════════ ═════════

At 31 December 2013 (Dealing NAV) Class A RMB (accumulation) 825,717 RMB98.73 Class A RMB (distribution) 1,940,261 RMB98.23 Class I RMB (accumulation) 945,327,232 RMB98.89 Class I RMB (distribution) 7,766,792 RMB98.39 ══════════ ═════════

Highest and lowest net asset value per unit (Dealing NAV)

Highest net Lowest net asset value asset value per unit per unit

At 31 December 2015 (Dealing NAV) Class A RMB (accumulation) RMB109.33 RMB103.19 Class A RMB (distribution) RMB99.49 RMB97.68 Class A HKD(accumulation) HKD108.77 HKD103.19 Class I RMB (accumulation) RMB110.60 RMB103.89 Class I USD (accumulation) USD10.84 USD10.37 ══════════ ══════════

At 31 December 2014 (Dealing NAV) Class A RMB (accumulation) RMB103.52 RMB98.75 Class A RMB (distribution) RMB99.30 RMB97.88 Class I RMB (accumulation) RMB104.14 RMB98.92 ══════════ ══════════

At 31 December 2013 (Dealing NAV) Class A RMB (accumulation) RMB100.41 RMB98.56 Class A RMB (distribution) RMB100.41 RMB98.07 Class I RMB (accumulation) RMB100.42 RMB98.66 Class I RMB (distribution) RMB100.42 RMB98.22 ══════════ ══════════

- 63 -