20 20 i Capital Global Fund Audited Financial Statements For the financial year ended 30 April 2020 Contents Statement by Directors 4 Independent Auditors’ Report 5 Audited Financial Statements 7 Statement of Financial Position 7 Statement of Comprehensive Income 8 Statement of Changes in Net Assets Attributable to Holders of Participating Shares 9 Statement of Cash Flows 10 Notes to Financial Statements 11 1 In the twelve months ended 30 April 2020, the Annual report of the net asset value (NAV) of the i Capital Global Fund decreased 14.24% or US$146.071 Fund Manager from US$1,025.690 to US$879.619 per share. In the same period, the MSCI ACWI for the financial year decreased 6.80%. ended 30 April 2020 The portfolio of your Fund is spread across 14 companies that are engaged in a wide range of business activities – see the Schedule of Securities in page 20. The top 5 investments as at 30 April 2020 Performance were Alibaba Group Holding, Pfeiffer Vacuum Technology, Zhengzhou Yutong Bus Co-A, This is the fourth Quarterly and Annual Qualys Inc and Overseas Education Ltd. Report of the i Capital Global Fund for the They made up 63.10% of the total assets. At financial year ended 30 April 2020. the end of April 2020, your Fund had 5.27% of its NAV in cash. Between 6 July 2007 and 30 April 2020, the NAV of the i Capital Global Fund lost 12.04% or US$120.381 from US$1,000.000 to US$879.691 per share. In the same period, the MSCI ACWI Strategy increased 19.91%. STRONG GLOBAL ECONOMIC RECOVERY? Figure 1 shows the NAV of the i Capital Global Fund against the performance In our last commentary, we wrote that in the of the MSCI All Country World Index(1) world of coronavirus, a few months are a (MSCI ACWI) since its launch which was long time. Indeed it has been. Since our last just before the financial markets and quarterly commentary in May, the Covid-19 economies were seriously affected by the pandemic has claimed a lot more people. 2008 US-led financial crisis. Since then, The United States of America remains the your Fund has outperformed the MSCI “leading” country in this fierce pandemic. ACWI from 2007 to 2015 but subsequently With 14.58 million confirmed cases, the US trailed the said index due mainly to a high is far ahead of any country. Until the time of cash level. writing this commentary, more than 281,000 Americans have died. Few people realised Figure 1 ICGF NAV vs MSCI ACWI (6 JUL 2007 - 30 APR 2020) that this number, which is still soaring, is already much higher than the total number of Americans who died in the First World War, Korean War and Vietnam War combined. Very soon, it will even surpass the 405,399 Americans combat and non-combat deaths recorded in the 5-year Second World War. What makes this public health crisis even more tragic is that had US president Donald Trump managed the pandemic seriously and responsibly, a lot of American lives would have been saved. History will show that Trump recklessly played the political fiddle as the United States was ravaged by SARS- CoV-2. 2 As we wrote before, managing the With the multi-trillion monetary and fiscal Covid-19 pandemic is not just about stimulus already in place all over the world, vaccine, managing this public health crisis and the roll-out of various vaccines, the is about: [1] good public governance, [2] global economy is set for a pretty robust accountability of political leaders, [3]. being recovery, especially after the initial months socially responsible, [4]. the community of 2021. having social discipline, [5]. the political leaders not being arrogant and [6] not being Throughout 2020, the i Capital Global complacent. Fund has been pretty much fully invested. While it has taken profit on Pfeiffer Vacuum As the world grapples with the Covid-19 and Qualys and exited The Hour Glass, it pandemic, China stands tall even though has invested in Formfactor (NASDAQ), the self-proclaimed objective Western Krones AG (Frankfurt) and Concord New media and politicians have been silent with Energy (HKEX). At the time of writing this their praises. The only economy that will commentary, cash remains at a single digit experience positive GDP growth in 2020, level of your Fund’s NAV. China will perform even better in 2021. We still strongly recommend investors For the rest of the world, thanks to very fast to invest more. The NAV of i Capital sharing of the genome sequence in early Global Fund can be viewed at either 2020, Covid-19 vaccines are already on the www.capitaldynamics.com.sg or way, far ahead of expectations but expected www.funds.icapital.biz. by Capital Dynamics early on. Over the weekend of 11 January 2020, Chinese authorities shared the full sequence of the coronavirus genome. That information was decisive in starting the process to develop a vaccine. Best wishes. Although the vaccine headlines are presently captured by BioNTech, Pfizer and Fosun Tan Teng Boo Pharma and Moderna, China is expected to Director have 600 million doses of Covid-19 vaccines Capital Dynamics (S) Private Limited ready for market before 2020 ends. Wang 4th December 2020 Junzhi deputy head of an expert task force on vaccine development under China’s (1): MSCI ACWI Index: A free float-adjusted market capitalisation weighted index which consists of 45 country indices, comprising 24 State Council made the remarks at a recent developed and 21 emerging market country indices. This includes the briefing in Wuhan. stock markets of China, which the ICGF cannot invest in at this time 3 Statement by Directors We, Che Hui Shan and Ng Kian Teck, being the two directors of i Capital Global Fund, do hereby state that, in our opinion: (i) the accompanying statement of financial position, statement of comprehensive income, statement of changes in net assets attributable to holders of participating shares and statement of cash flows together with notes thereto are drawn up so as to give a true and fair view of the state of affairs of the Fund as at 30 April 2020 and the results of the business, changes in net assets attributable to holders of participating shares and cash flows of the Fund for the financial year ended on that date; and (ii) at the date of this statement, there are reasonable grounds to believe that the Fund will be able to pay its debts as and when they fall due. Che Hui Shan Ng Kian Teck DIRECTOR DIRECTOR Singapore 14 October 2020 4 Ernst & Young Ltd. Main tel: +1 345 949 8444 62 Forum Lane Fax: +1 345 949 8529 Camana Bay ey.com P.O. Box 510 Grand Cayman KY1-1106 CAYMAN ISLANDS Independent Auditors’ Other information Other information consists of the statement of Report directors. Management is responsible for the other information. THE DIRECTORS Our opinion on the financial statements does i CAPITAL GLOBAL FUND not cover the other information and we do not express any form of assurance conclusion Report on the audit of the financial statements thereon. Opinion In connection with our audit of the financial We have audited the financial statements of statements, our responsibility is to read the other i Capital Global Fund (the “Fund”) which comprise information and, in doing so, consider whether the statement of financial position as at 30 April the other information is materially inconsistent 2020, and the statement of comprehensive with the financial statements or our knowledge income, statement of changes in net assets obtained in the audit or otherwise appears to attributable to holders of participating shares be materially misstated. If, based on the work and statement of cash flows for the year then we have performed, we conclude that there is a ended, and notes to the financial statements, material misstatement of this other information, including a summary of significant accounting we are required to report that fact. We have policies. nothing to report in this regard. In our opinion, the accompanying financial Responsibilities of management and the Board statements present fairly, in all material respects, of Directors for the financial statements the financial position of the Fund as at 30 April 2020 and its financial performance and its cash Management is responsible for the preparation flows for the year then ended in accordance with and fair presentation of the financial statements International Financial Reporting Standards. in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary Basis for opinion to enable the preparation of financial statements We conducted our audit in accordance with that are free from material misstatement, whether International Standards on Auditing (ISAs). due to fraud or error. Our responsibilities under those standards are further described in the Auditors’ responsibilities In preparing the financial statements, for the audit of the financial statements section management is responsible for assessing the of our report. We are independent of the Fund Fund’s ability to continue as a going concern, in accordance with the International Code of disclosing, as applicable, matters related to going Ethics for Professional Accountants (including concern and using the going concern basis of International Independence Standards) (IESBA accounting unless management either intends Code), and we have fulfilled our other ethical to liquidate the Fund or to cease operations, or responsibilities in accordance with the IESBA has no realistic alternative but to do so. Code. We believe that the audit evidence we have obtained is sufficient and appropriate to The Directors are responsible for overseeing the provide a basis for our opinion.