investec funds series iii annual report and accounts · 2016. 6. 10. · report and accounts...
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OEIC | REPORT AND ACCOUNTS INVESTEC FUNDS SERIES III
Investec Funds Series iiiAnnual Reportand Accounts For the year ended 29 February 2016
REPORT AND ACCOUNTS
Investec Funds Series iii 1
Registered addressWoolgate Exchange,
25 Basinghall Street
London EC2V 5HA
Correspondence address Investec Fund Managers Limited
PO Box 9042
Chelmsford
CM99 2XL
Report and accounts
For the year ended 29 February 2016
Investec Funds Series iii Report & Accounts
Emerging Markets Local Currency Debt Fund* 2- 4
Global Bond Fund* 5- 7
Global Dynamic Fund* 8- 10
Global Equity Fund* 11- 13
Global Gold Fund* 14- 16
Portfolio statements per Fund* 17- 33
Authorised Corporate Director’s report* 34- 35
Statement of Authorised Corporate Director’s responsibilities 36
Statement of Depositary’s responsibilities and report to shareholders 37
Independent Auditor’s report 38- 39
Comparative table 40- 52
Financial statements 53- 100
Glossary 101-106
Other information 107- 113
* The above information collectively forms the Authorised Corporate Director’s report
REPORT AND ACCOUNTS
Investec Funds Series iii2
Emerging Markets Local Currency Debt Fund
Summary of the Fund’s investment objective and policy
The Fund aims to provide an income and grow the value of your investment over the long term.
The Fund invests primarily in bonds (contracts to repay borrowed money which typically pay interest at fi xed times) and in
related derivatives (fi nancial contracts whose value is linked to the price of an underlying asset).
The bonds are issued by governments, institutions or companies in emerging markets (countries that are in economic terms
less developed than the major Western countries). These bonds are predominantly issued in the currency of the issuing country.
The Investment Manager is free to choose how the Fund is invested. However, the JPMorgan GBI-EM Global Diversifi ed GBP
Index is currently taken into account when the Fund’s investments are selected.
Performance record
Investec Emerging Market Local Currency Debt Fund ‘A’ accumulation shares -6.65%*
Performance comparison index -2.97%**
Peer group Not applicable**
Total deemed income distributions per ‘A’ accumulation share
12 months to 29 February 2016 5.98 pence
12 months to 29 February 2015 8.30 pence
The Fund underperformed its comparative index over the period. Our overall underweight exposure to emerging market (EM)
currencies and some of the Fund’s bond holdings detracted from returns; however, exposure to certain currencies was
positive.
Factors hindering performance
Over the period, one of the most signifi cant factors hindering performance was an underweight position in the Peruvian new
sol, which we held because of our concerns about the currency’s unsustainably high value given the economy’s reliance on
commodity exports. Nonetheless, we initially underestimated the ambition of the country’s central bank to intervene in
defending the value of its currency and eventually decided to exit this trade to protect the Fund from potential further losses.
From a bond perspective, we held an Israeli derivative position that was designed to benefi t from a rise in interest rates,
which weighed on our relative performance, as lower infl ation helped keep interest rates supressed. Similarly, we typically
maintained an underweight position in Czech bonds for the year which weighed on returns as stimulus measures were
announced by the European Central Bank (ECB), thus supporting European bond prices.
Factors helping performance
We maintained an overweight allocation to the Indonesian rupiah over the 12-month period, which made a positive
contribution to returns. The rupiah outperformed during the review period, with the country’s relatively high interest rate
helping to stabilise the currency and positive government reforms further encouraging investor infl ows. Similarly, our position
in defensive currencies – such as the Chinese renminbi and Egyptian pound – also outperformed, given they have
historically been managed in a tight range relative to the US dollar. From a bond perspective, our underweight exposure to
Turkey added to returns as concerns over the central bank’s independence and rising infl ation weighed on the country’s
bond prices.
REPORT AND ACCOUNTS
Investec Funds Series iii 3
Signifi cant purchases during the year:
Poland Government Bond 3.25% 25/07/2025, Mexican Bonos 7.75% 29/05/2031, Russian Federal Bond 6.7% 15/05/2019,
South Africa Government Bond 7.25% 15/01/2020, Mexican Bonos 10% 05/12/2024.
Signifi cant sales during the year:
Poland Government Bond 3.25% 25/07/2025, Thailand Government Bond 3.65% 17/12/2021, Investec GSF Emerging
Markets Blended Debt Fund, Singapore Government Bond 3% 01/09/2024, Brazil Notas do Tesouro Nacional 10%
01/01/2021.
Outlook
We expect that emerging markets with close ties to China, or those that rely heavily on commodity markets, will continue to
face a challenging environment over the medium term. However, we believe that EM assets in general have adjusted to the
current economic environment of low growth and further increases in US interest rates. We believe these challenges will
taper off in time, and so the prospects for local currency EM debt should improve over the next one to fi ve years.
With US economic data releases over February somewhat more positive, the market has arguably not re-adjusted to the
relatively strong US growth story. If markets reprice for interest rate rises earlier in the year, there may be some short-term
volatility, but we believe the impact on EM debt this year should be modest compared with previous years, and we maintain
our view that the US Federal Reserve will be reluctant to increase rates quickly and threaten the fragile economic recovery.
In China, at the annual National People’s Congress in early March, authorities reiterated their commitment to supporting
growth, setting a target of 6.5–7.0% for 2016. We therefore expect a continuation of stimulatory policies by the Chinese
central bank and government, as evidenced recently by the further lowering of banks’ reserve requirements and a widening
of the budget defi cit to 3.0%, from 2.3% last year. After a shaky start to 2016, China’s authorities have succeeded in
stabilising the country’s currency and equity markets for now. However, given the need to ease monetary policy to support
growth, it may be diffi cult to stem depreciation over the longer term without further restricting capital outfl ows. Over the
medium term, we believe that risks remain from a growth perspective, given the overcapacity in the industrial sector and the
over-indebtedness of some sectors of the economy. This means that headwinds are likely to persist for EMs linked closely to
the Chinese economy, particularly those countries that are overly reliant on commodity exports. However, the growth outlook
is more positive in select EMs, such as India, Mexico, and central and eastern Europe.
While various factors have impacted local currency EM debt over the last few years, we feel that these are now better priced
into global markets. In particular, we believe that EM assets have largely adjusted to the prospect of higher US interest rates.
After an extensive period of challenging conditions, we believe the prospects for the asset class could improve over the next
one to fi ve years, helped by higher yields and the potential for both EM growth and trade to improve.
*Source: Morningstar, total return, income reinvested net of UK basic rate tax, no initial charge, accumulation share class (acc), net of fees
in GBP. Past performance should not be taken as a guide to the future and there is no guarantee that this investment will make profi ts.
**Index (the JP Morgan GBI-EM Global Diversifi ed Index) shown for performance comparison purposes only. For this Fund, there is no
relevant peer group sector against which to measure Fund performance.
The opinions expressed herein are as at end of February 2016.
REPORT AND ACCOUNTS
Investec Funds Series iii4
Risk and Reward profi le*
Lower risk Higher risk
Potentially lower rewards Potentially higher rewards
This indicator is based on historical data and may not be a reliable indication of the future risk profi le of the Fund. The risk
and reward category shown is not guaranteed to remain unchanged and may shift over time. The lowest category does not
mean ‘risk free’.
The value of your investment and any income from it can fall as well as rise and you are not certain of making profi ts; losses
may be made.
The Fund appears towards the middle of the Risk and Reward Indicator scale. This is because it invests in bonds whose
returns tend to fl uctuate more than those of cash funds but less than those of funds which invest in the shares of companies.
The following risks may not be fully captured by the Risk and Reward Indicator:
Currency exchange: Changes in the relative values of different currencies may adversely affect the value of the Fund’s
investments and any related income.
Default: There is a risk that the issuers of fi xed income investments (e.g. bonds) may not be able to meet interest payments
nor repay the money they have borrowed. The worse the credit quality of the issuer, the greater the risk of default and
therefore investment loss.
Derivative counterparty: A counterparty to a derivative transaction may fail to meet its obligations to the Fund thereby
leading to fi nancial loss.
Derivatives: The use of derivatives may increase the overall risk in the Fund by multiplying the effect of both gains and
losses. This may lead to large changes in the value of the Fund and potentially large fi nancial loss.
Developing market: Some of the countries in which the Fund invests may have less developed legal, political, economic
and/or other systems. These markets carry a higher risk of fi nancial loss than those in countries generally regarded as being
more developed.
Interest rate: The value of fi xed income investments (e.g. bonds) tends to decrease when interest rates and/or infl ation
rises.
Investing in China: Investment in mainland China may involve a higher risk of fi nancial loss when compared with
countries generally regarded as being more developed.
Liquidity: There may be insuffi cient buyers or sellers of particular investments giving rise to delays in trading and being
able to make settlements from the Fund and/or large fl uctuations in the value of the Fund which may lead to larger fi nancial
losses than might be anticipated.
Third party operational: The Fund’s operations depend on third parties. Investors in the Fund may suffer disruption or
fi nancial loss in the event of third-party operational failure.
*The Risk and Reward profi le is taken from the Key Investor Information Document. Please note that, the Risk and Reward profi le section is
based on Sterling “A” Class Accumulation shares.
The full list of the Fund’s risks are contained in Appendix VII of the Investec Funds Series iii prospectus.
1 765432
REPORT AND ACCOUNTS
Investec Funds Series iii 5
Global Bond Fund
Summary of the Fund’s investment objective and policy
The Fund aims to provide an income and grow the value of your investment over the long term.
The Fund invests around the world in bonds (contracts to repay borrowed money which typically pay interest at fi xed times)
and related derivatives (fi nancial contracts whose value is linked to the price of an underlying asset).
The bonds held are issued by governments, institutions and companies and are primarily of investment grade (high quality)
as rated by the credit rating agencies (companies that rate the ability of the issuers of bonds to repay borrowed money).
The Investment Manager is free to choose how the Fund is invested. However, the Barclays Global Aggregate Bond Index is
currently taken into account when the Fund’s investments are selected.
Performance record
Investec Global Bond Fund ‘A’ income shares 9.43%*
Performance comparison index 11.82%**
Peer group 2.46%**
Total income distributions per ‘A’ income share
12 months to 29 February 2016 0.86 pence
12 months to 28 February 2015 1.30 pence
The Fund underperformed the performance comparison index, with our lower exposure to government bonds in the US
and Japan adversely impacting relative returns. However, later in the year, the Fund increased its exposure to Japanese
government bonds, which offset these losses somewhat. Other detractors included our overweight positions in European
bonds, emerging market (EM) debt and US infl ation-linked bonds. More positively, the Fund signifi cantly outperformed its
peer group during the review period, with corporate bond exposure contributing to returns.
Factors hindering performance
The underperformance was largely due to our lower exposure to developed market government bonds relative to the index,
particularly in the US and Japan. The former continued to perform well, as market participants lowered their expectations
for interest-rate rises, based on the more dovish stance of the US Federal Reserve (Fed) and deteriorating global data.
Meanwhile, Japanese government bonds continued to rally as the Bank of Japan added a new dimension, negative interest
rates, to its monetary policy framework.
Our overweight position in US infl ation-linked bonds also detracted from returns as global commodity prices came under
pressure during 2015, before falling further at the beginning of 2016. Consequently, this position in the Fund was sold.
The performance in the second half of the period was affected by our overweight exposure to European bonds.
The European Central Bank failed to live up to the market’s expectations in its December meeting, when it announced
a weaker-than-expected stimulus package. This meant that euro-zone bond yields did not fall as far as we had anticipated.
The Fund’s active currency exposure also had a negative impact on returns. Elsewhere, our EM debt exposure detracted
from relative returns in what proved to be a diffi cult period for the asset class, and EM assets in general.
Factors helping performance
The Fund signifi cantly outperformed its peers over the 12-month period. Our corporate bond exposure added to returns,
helped by favourable security selection, in spite of the global economic headwinds from China, the Fed’s interest-rate hike
and the fall in prices of commodities, particularly oil.
Also, in December 2015, the Fund substantially increased its Japanese government bond exposure. Yields continued to fall,
which helped partially offset the negative returns from our lower exposure earlier in the year.
REPORT AND ACCOUNTS
Investec Funds Series iii6
Signifi cant purchases during the year:
Norway Government Bond 3% 14/03/2024, United States Treasury Infl ation Indexed Bond 0.125% 15/04/2019, Mexican
Bonos 4.75% 14/06/2018, Bundesobligation 0.25% 16/10/2020, United States Treasury Infl ation Indexed Bond 0.125%
15/04/2020, Poland Government Bond 2.5% 25/07/2018, Deutsche Bundesrepublik Infl ation Linked Bond 1.75% 15/04/2020,
Bundesobligation 0% 09/04/2021, Israel Government Bond 2.25% 31/05/2019, United States Treasury Note 2.125%
15/08/2021, United States Treasury Note 0.75% 30/06/2017, Sweden Government Bond 5% 01/12/2020, Hungary
Government Bond 2.5% 27/10/2021, United States Treasury Infl ation Indexed Bond 0.375% 15/07/2025, United Kingdom
Gilt 2% 22/07/2020, Sweden Government Bond 2.5% 12/05/2025, Western Australian Treasury 5% 23/07/2025, Queensland
Treasury 4.75% 21/07/2025, Israel Government Bond 6% 28/02/2019, Bundesrepublik Deutschland 0.5% 15/02/2025,
Czech Republic Government Bond 2.4% 17/09/2025
Signifi cant sales during the year:
United States Treasury Infl ation Indexed Bond 0.125% 15/04/2019, Mexican Bonos 4.75% 14/06/2018, United States Treasury
Infl ation Indexed Bond 0.125% 15/04/2020, Norway Government Bond 3% 14/03/2024, Poland Government Bond 2.5%
25/07/2018, Deutsche Bundesrepublik Infl ation Linked Bond 1.75% 15/04/2020, Bundesschatzanweisungen 0% 16/12/2016,
Bundesrepublik Deutschland 6.25% 04/01/2024, United States Treasury Note 3.125% 15/05/2019, United States Treasury
Note 2.125% 15/08/2021, United States Treasury Note 0.75% 30/06/2017, Bundesobligation 1% 12/10/2018, United Kingdom
Treasury 2.25% 07/09/2023, Sweden Government Bond 5% 01/12/2020, United States Treasury Infl ation Indexed Bond
0.375% 15/07/2025, Israel Government Bond 2.25% 31/05/2019, United Kingdom Gilt 2% 22/07/2020, Sweden Government
Bond 2.5% 12/05/2025, United States Treasury Note 2.75% 15/11/2023, United States Treasury Note 4.625% 15/02/2040,
Investec GSF Emerging Markets Local Currency Dynamic Debt Fund (GBP), Investec GSF Emerging Markets Local Currency
Dynamic Debt Fund (USD), Israel Government Bond 4.25% 31/03/2023, Bundesrepublik Deutschland 0.5% 15/02/2025
Outlook
Recent economic data releases suggest that global growth is not as fragile as investors had feared. However, the challenges
China faces appear likely to persist in the medium term. We have a cautious bias towards growth assets and remain vigilant
when investing in high yield corporate and EM bond markets. We believe that commodity-producing countries’ exchange
rates could strengthen, although the US dollar’s rally is far from over.
In February, economic data, from the US in particular, reinforced our view that growth is reasonably well underpinned.
Any further recovery in oil and other commodity prices will help in this regard. Meanwhile, there are signs that the reduction
in supply of certain commodities may have gone far enough to reduce the risk of prices falling further. Overall, we believe
that the global economy is not as weak as markets were beginning to suggest at the start of 2016.
Of course, there are still risks. We continue to worry about the structural challenges facing China and what these could
mean for demand, and the renminbi exchange rate, in the medium term. However, Chinese policy has been focused on
near-term stability and may lessen these pressures temporarily. Other concerns around ‘Brexit’ and the US election may
cause some volatility, which will need to be managed. For now, we retain a modest positive bias towards growth assets and
remain vigilant when investing in high yield corporate bond markets and EM bonds, while retaining exposure to attractive
defensive positions. In currency markets, we believe that there is scope for the exchange rates of commodity-producing
countries to strengthen, but on a limited basis. While this strengthening may come at the expense of the US dollar,
we believe that it is too soon to claim that the dollar’s rally is over given the Fed’s scope to hike interest rates further.
*Source: Morningstar, total return, income reinvested net of UK basic rate tax, no initial charge, income share class (inc), net of fees in GBP.
Past performance should not be taken as a guide to the future and there is no guarantee that this investment will make profi ts.
**Index (the Barclay’s Capital Global Aggregate Index) and sector (the Investment Association Global Bonds sector) shown for performance
comparison purposes only.
The opinions expressed herein are as at end of February 2016.
REPORT AND ACCOUNTS
Investec Funds Series iii 7
Risk and Reward profi le*
Lower risk Higher risk
Potentially lower rewards Potentially higher rewards
This indicator is based on historical data and may not be a reliable indication of the future risk profi le of the Fund. The risk
and reward category shown is not guaranteed to remain unchanged and may shift over time. The lowest category does not
mean ‘risk free’.
The value of your investment and any income from it can fall as well as rise and you are not certain of making profi ts;
losses may be made.
The Fund appears towards the middle of the Risk and Reward Indicator scale. This is because it invests in bonds whose
returns tend to fl uctuate more than those of cash funds but less than those of funds which invest in the shares of companies.
The following risks may not be fully captured by the Risk and Reward Indicator:
Currency exchange: Changes in the relative values of different currencies may adversely affect the value of the Fund’s
investments and any related income.
Default: There is a risk that the issuers of fi xed income investments (e.g. bonds) may not be able to meet interest payments
nor repay the money they have borrowed. The worse the credit quality of the issuer, the greater the risk of default and
therefore investment loss.
Derivative counterparty: A counterparty to a derivative transaction may fail to meet its obligations to the Fund thereby
leading to fi nancial loss.
Derivatives: The use of derivatives may increase the overall risk in the Fund by multiplying the effect of both gains and
losses. This may lead to large changes in the value of the Fund and potentially large fi nancial loss.
Developing market: Some of the countries in which the Fund invests may have less developed legal, political, economic
and/or other systems. These markets carry a higher risk of fi nancial loss than those in countries generally regarded as being
more developed.
Interest rate: The value of fi xed income investments (e.g. bonds) tends to decrease when interest rates and/or infl ation
rises.
Third party operational: The Fund’s operations depend on third parties. Investors in the Fund may suffer disruption or
fi nancial loss in the event of third-party operational failure.
*The Risk and Reward profi le is taken from the Key Investor Information Document. Please note that, the Risk and Reward profi le section is
based on Sterling “A” Class Income shares.
The full list of the Fund’s risks are contained in Appendix VII of the Investec Funds Series iii prospectus.
1 765432
REPORT AND ACCOUNTS
Investec Funds Series iii8
Global Dynamic Fund
Summary of the Fund’s investment objective and policy
The Fund aims to grow the value of your investment over the long term.
The Fund invests around the world primarily in a focussed selection of company shares and in related derivatives (fi nancial
contracts whose value is linked to the price of an underlying asset).
The Investment Manager is free to choose how the Fund is invested and does not manage it with reference to an index.
Performance recordInvestec Global Dynamic Fund ‘A’ accumulation shares -3.75%*
Performance comparison index -2.77%**
Peer group -3.72%**
The Fund underperformed both its performance comparison index and peer group during the period under review.
Detractors included Valeant Pharmaceuticals International; Anhui Conch Cement, and Rio Tinto, given the commodity-price
slump. On the positive side, technology companies Vantiv, Activision Blizzard, Fiserv, Broadcom, Amdocs and PayPal added
robust relative returns, as did healthcare holdings Cigna and Mylan.
Factors hindering performance
Valeant Pharmaceuticals International encountered criticism over its pricing model, along with industry peers, after US
politicians voiced their concerns about excess profi teering in the sector. The Canadian-based pharmaceuticals company
was also forced to sever ties with speciality pharmacy Philidor in October, amid allegations of aggressive sales practices.
While investors welcomed the news that Valeant had signed a new distribution deal with US drug retail chain Walgreens,
the stock was hit by more negative headlines towards the end of the period.
Anhui Conch Cement, China’s second-largest cement company, fell as slowing domestic growth adversely impacted cement
demand. We have since sold the stock. There were also negative contributions from miners Rio Tinto and Grupo Mexico. Despite
good production performance and strong ongoing cost-cutting measures, Rio Tinto’s share price fell as oversupply in its key
commodity markets of iron ore, copper and coal led to notable price declines, exacerbated by slowing demand from China,
the world’s largest consumer of commodities. We believe Rio is one of the best placed miners (and resource companies) to not
only survive the current price environment, but is able to maintain its fi nancial strength while delivering some modest growth.
Elsewhere, the likes of Regal Beloit, Hess, Woodside Petroleum and Cobham were negatively impacted by low prices
because of their exposure to the oil and gas industries. We continue to hold Woodside and Cobham but have sold our
positions in Regal Beloit and Hess.
Meanwhile, exposure to Brazilian bank Itau Unibanco hurt performance after the stock lost value, along with Brazil’s fi nancial
markets, as the country continued to face political and economic headwinds. While Jones Lang LaSalle’s (JLL) share price
held up for most of the period, investors reacted negatively to the unexpected fourth-quarter 2015 earnings miss from the
US real estate and brokerage company. Similarly, holding Citigroup, the multinational investment banking and fi nancial
services company, hurt returns after it delivered a weak set of fourth-quarter earnings, with cost effi ciency an area of major
disappointment. Our investment case for JLL continues to hold, with 2015 underlining the company’s ability to gain market
share and generate above-market growth. We also continue to hold Citigroup in view of its cheap valuation and strength of
its capital base relative to banking peers.
In addition, not holding large index constituents Google (which has been renamed as Alphabet), Amazon, Facebook and
General Electric weighed on relative returns, as these stocks performed well.
Factors helping performance
Vantiv, the US payment-processing company, gained as its results showed an acceleration in growth, while Activision
Blizzard, the US gaming company, found support from consistently strong results together with the stock’s promotion to the
S&P 500 Index at the end of August. The company also continued to see growth in its key franchises, particularly sales of its
REPORT AND ACCOUNTS
Investec Funds Series iii 9
Destiny and Call of Duty games, while the acquisition of King Digital Entertainment, the creator of Candy Crush, was well
received by investors. There were also positive contributions from other information technology companies held by the Fund,
including Fiserv, Broadcom, Amdocs and PayPal.
There was a positive contribution from Nippon Telegraph & Telephone (NTT), the Japanese fi xed-line and mobile telephone
operator, which continued to deliver good results over the period. US healthcare company Cigna found support on healthy
earnings and positive merger and acquisition news, while shares in global pharmaceuticals company Mylan rebounded after
the collapse of its potentially hostile takeover of over-the-counter drugmaker Perrigo, which had not been well received by
the market.
ServiceMaster Global, Philip Morris International and Johnson & Johnson were also among the biggest contributors to
returns over the period. More recently, ServiceMaster Global, a provider of residential and commercial services, performed
well after management raised its guidance for full-year earnings.
Signifi cant purchases during the year:
eBay, Regal Beloit, Anhui Conch Cement, Voya Financial, Tokio Marine, Citigroup, Comcast, Ally Financial, Priceline
Signifi cant sales during the year:
Mylan, Goldman Sachs, Broadcom, Mondi, Anheuser Busch Inbev
Outlook
Market participants are currently speculating whether an investor migration towards value stocks is occurring. Given that the
recent market dips were based on negative sentiment rather than hard data, there could well be scope for a rebound in the
most oversold sectors. We believe consumers will continue to benefi t fi nancially from lower commodity prices, and that any
resultant boost in purchasing power is good for both growth and global stock markets.
Out-of-favour ‘value’ stocks have performed well recently, and investors are busy questioning whether a more sustainable
move towards value stocks is now underway. We have seen a narrowing of market breadth (where there are more stocks
that have declined in value than stocks that have risen in value) since August 2015, which usually signals that some sort of
change in market direction or leadership is imminent. That said, it is diffi cult to be convinced when the other value-rich
sector, fi nancials, has underperformed on the back of concerns about the credit market and bad debt.
There is certainly good reason for a bounce in the heavily oversold areas of the market, as we believe the recent sell-off
seems to have been based more on sentiment than evidence. That said, the fourth-quarter earnings season has not been
particularly strong, and guidance for 2016 has been broadly disappointing – to the extent that growth in corporate profi ts is
expected to stall this year.
However, we still believe consumers will benefi t fi nancially from lower commodity prices. Any boost in purchasing power
of this degree is never a smooth transition, but with consumer spending and employment numbers beating expectations,
the evidence suggests that the weak start to 2016 for global stock markets has not derailed the process. We believe that
this broad transition is ultimately good for growth and will help to underpin the world’s stock markets in future.
The outlook statement refl ects the views of the output from our 4Factor Equities team and is therefore similar to that of the Investec Global
Equity Fund.
*Source: Morningstar, total return, income reinvested net of UK basic rate tax, no initial charge, accumulation share class (acc), net of fees
in GBP. Past performance should not be taken as a guide to the future and there is no guarantee that this investment will make profi ts.
**Index (MSCI*** All Countries World Index) and peer group (Investment Association Global) shown for performance comparison purposes
only.
***Source: MSCI. The MSCI data is comprised of a custom index calculated by MSCI for, and as requested by, Investec Asset Management
Limited. The MSCI data is for internal use only and may not be redistributed or used in connection with creating or offering any securities,
fi nancial products or indices. Neither MSCI nor any other third party involved in or related to compiling, computing or creating the MSCI
data (the “MSCI Parties’) makes any express or implied warranties or representations with respect to such data (or the results to be
obtained by the use thereof), and the MSCI Parties hereby expressly disclaim all warranties of originality, accuracy, completeness,
merchantability or fi tness for a particular purpose with respect to such data. Without limiting any of the foregoing, in no event shall any
of the MSCI Parties have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profi ts)
even if notifi ed of the possibility of such damages.
The opinions expressed herein are as at end of February 2016.
REPORT AND ACCOUNTS
Investec Funds Series iii10
Risk and Reward profi le*
Lower risk Higher risk
Potentially lower rewards Potentially higher rewards
This indicator is based on historical data and may not be a reliable indication of the future risk profi le of the Fund. The risk
and reward category shown is not guaranteed to remain unchanged and may shift over time. The lowest category does not
mean ‘risk free’.
The value of your investment and any income from it can fall as well as rise and you are not certain of making profi ts; losses
may be made.
The Fund appears towards the middle of the Risk and Reward Indicator scale. This is because it invests in the shares of
companies, whose values tend to fl uctuate more widely.
The following risks may not be fully captured by the Risk and Reward Indicator:
Concentration: Investments may be primarily concentrated in specifi c areas (e.g. countries/geographical regions and/or
industry sectors), in terms of investment style (e.g. income or growth), in individual holdings and/or in a number of other
ways. This may mean the value of the Fund may decrease whilst more broadly invested funds might grow.
Currency exchange: Changes in the relative values of different currencies may adversely affect the value of the Fund’s
investments and any related income.
Derivatives: The use of derivatives is not intended to increase the overall level of risk in the Fund. However, the use of
derivatives may still lead to large changes in the value of the Fund and includes the potential for large fi nancial loss.
Developing market: Some of the countries in which the Fund invests may have less developed legal, political, economic
and/or other systems. These markets carry a higher risk of fi nancial loss than those in countries generally regarded as being
more developed.
Equity investment: The value of equities (e.g. shares) and equity-related investments may vary according to company
profi ts and future prospects as well as more general market factors. In the event of a company default (e.g. bankruptcy), the
owners of their equity rank last in terms of any fi nancial payment from that company.
Investing in China: Investment in mainland China may involve a higher risk of fi nancial loss when compared with
countries generally regarded as being more developed.
Third party operational: The Fund’s operations depend on third parties. Investors in the Fund may suffer disruption or
fi nancial loss in the event of third-party operational failure.
*The Risk and Reward profi le is taken from the Key Investor Information Document. Please note that, the Risk and Reward profi le section is
based on Sterling “A” Class Accumulation shares.
The full list of the Fund’s risks are contained in Appendix VII of the Investec Funds Series iii prospectus.
1 765432
REPORT AND ACCOUNTS
Investec Funds Series iii 11
Global Equity Fund
Summary of the Fund’s investment objective and policy
The Fund aims to grow the value of your investment over the long term.
The Fund invests primarily in the shares of companies in the larger, more liquid (easier to deal in) markets of the USA,
continental Europe, UK and Japan, and in related derivatives (fi nancial contracts whose value is linked to the price of an
underlying asset).
The Investment Manager is free to choose how the Fund is invested. However, the MSCI All Countries World Net Return
Index is currently taken into account when the Fund’s investments are selected.
Performance record
Investec Global Equity Fund ‘A’ accumulation shares -5.66%*
Performance comparison index -2.77%**
Peer group -3.72%**
The Fund underperformed both its performance comparison index and peer group during the period under review.
Detractors included Valeant Pharmaceuticals International; Marathon Oil and Hess; and Rock-Tenn and Anhui Conch
Cement. On the positive side, technology stocks Vantiv and Activision Blizzard helped relative returns, as did Tyson Foods
and healthcare holding Cigna.
Factors hindering performance
Valeant Pharmaceuticals International encountered criticism over its pricing model, along with industry peers, after US
politicians voiced their concerns about excess profi teering in the sector. The Canadian-based pharmaceuticals company
was also forced to sever ties with speciality pharmacy Philidor in October, amid allegations of aggressive sales practices.
While investors welcomed the news that Valeant had signed a new distribution deal with US drug retail chain Walgreens,
the stock was hit by more negative headlines towards the end of the period.
While there are signs of a recovery in global oil markets, as prices rebounded from a 12-month low in January, US oil
companies Marathon Oil and Hess were negatively impacted by generally low commodity prices. Shares in WestRock
(previously known as Rock-Tenn), the US paper and packaging company, dropped sharply, along with other names in the
underperforming materials sector including Anhui Conch Cement, China’s second-largest cement company, which fell as
slowing domestic growth affected cement demand. We have subsequently sold out of Marathon Oil and Anhui Conch
Cement, but we continue to hold both WestRock and Hess. In our view, WestRock has sold off too heavily and we believe
Hess is better placed than most other oil companies to limit the production declines while massively cutting spending, with
strong opportunities if oil prices recover.
Shares in German auto manufacturer Volkswagen (VW) were down after revelations that it had manipulated emissions-test
data on its diesel vehicles in the US and Europe. We sold out of VW during the period. In addition, not holding large index
constituents Google (which has been renamed as Alphabet), Amazon, Facebook and General Electric weighed on relative
returns, as these stocks performed well.
Meanwhile, exposure to Brazilian bank Itau Unibanco hurt performance after the stock lost value, along with Brazilian
fi nancial markets, as the country continued to face political and economic headwinds.
Factors helping performance
Shares in Tyson Foods, the US meat-processing and marketing company, gained on strong results and optimistic
commentary from management on the outlook for earnings. Exposure to tobacco companies Japan Tobacco, Philip Morris
International and Imperial Brands also helped. Japan Tobacco performed well as it continued to benefi t from international
cigarette demand, improving domestic market volumes and favourable pricing trends.
REPORT AND ACCOUNTS
Investec Funds Series iii12
In Japan, telecommunication services companies Nippon Telegraph & Telephone (NTT) and KDDI contributed positively.
NTT, the fi xed-line and mobile telephone operator, continued to deliver good results over the period, which supported its
share price.
Vantiv, the US payment-processing company, gained as its results showed an acceleration in growth, while Activision
Blizzard, the US gaming company, found support from consistently strong results together with the stock’s promotion to the
S&P 500 index at the end of August. The company also continued to see growth in its key franchises, particularly sales of its
Destiny and Call of Duty games, while the acquisition of King Digital Entertainment, the creator of Candy Crush, was well
received by investors. There were also positive contributions from other information technology companies held by the Fund,
including Fiserv and Amdocs.
US healthcare company Cigna found support on healthy earnings and positive merger and acquisition news, while Alaska Air
and Japan Airlines benefi ted from low jet fuel prices.
Signifi cant purchases during the year:
Philip Morris International, eBay, Comcast, AT&T, Voya Financial
Signifi cant sales during the year:
Microsoft, Novartis, Goldman Sachs, Anheuser-Busch Inbev, Allianz
Outlook
Market participants are currently speculating whether an investor migration towards value stocks is occurring. Given that the
recent market dips were based on negative sentiment rather than hard data, there could well be scope for a rebound in the
most oversold sectors. We believe consumers will continue benefi t fi nancially from lower commodity prices, and that any
resultant boost in purchasing power is good for both growth and global stock markets.
Out-of-favour ‘value’ stocks have performed well recently, and investors are busy questioning whether a more sustainable
move towards value stocks is now underway. We have seen a narrowing of market breadth (where there are more stocks
that have declined in value than stocks that have risen in value) since August 2015, which usually signals that some sort of
change in market direction or leadership is imminent. That said, it is diffi cult to be convinced when the other value-rich
sector, fi nancials, has underperformed on the back of concerns about the credit market and bad debt.
There is certainly good reason for a bounce in the heavily oversold areas of the market, as we believe the recent sell-off
seems to have been based more on sentiment than evidence. That said, we concede that the fourth-quarter earnings
season has not been particularly strong, and guidance for 2016 has been broadly disappointing – to the extent that growth
in corporate profi ts is expected to stall this year.
However, we still believe consumers will benefi t fi nancially from lower commodity prices. Any boost in purchasing power of
this degree is never a smooth transition, but with consumer spending and employment numbers beating expectations, the
evidence suggests that the weak start to 2016 for global stock markets has not derailed the process. We believe that this
broad transition is ultimately good for growth and will help to underpin the world’s stock markets in future.
The outlook statement refl ects the views of the output from our 4Factor Equities team and is therefore similar to that of the Investec Global
Dynamic Fund.
*Source: Morningstar, total return, income reinvested net of UK basic rate tax, no initial charge, accumulation share class (acc), net of fees
in GBP. Past performance should not be taken as a guide to the future and there is no guarantee that this investment will make profi ts.
**Index (MSCI*** All Countries World Index) and peer group (Investment Association Global sector) shown for performance comparison
purposes only.
***Source: MSCI. The MSCI data is comprised of a custom index calculated by MSCI for, and as requested by, Investec Asset Management
Limited. The MSCI data is for internal use only and may not be redistributed or used in connection with creating or offering any securities,
fi nancial products or indices. Neither MSCI nor any other third party involved in or related to compiling, computing or creating the MSCI
data (the “MSCI Parties”) makes any express or implied warranties or representations with respect to such data (or the results to be
obtained by the use thereof), and the MSCI Parties hereby expressly disclaim all warranties of originality, accuracy, completeness,
merchantability or fi tness for a particular purpose with respect to such data. Without limiting any of the foregoing, in no event shall any
of the MSCI Parties have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profi ts)
even if notifi ed of the possibility of such damages.
The opinions expressed herein are as at end of February 2016.
REPORT AND ACCOUNTS
Investec Funds Series iii 13
Risk and Reward profi le*
Lower risk Higher risk
Potentially lower rewards Potentially higher rewards
This indicator is based on historical data and may not be a reliable indication of the future risk profi le of the Fund. The risk
and reward category shown is not guaranteed to remain unchanged and may shift over time. The lowest category does not
mean ’risk free’.
The value of your investment and any income from it can fall as well as rise and you are not certain of making profi ts; losses
may be made.
The Fund appears towards the middle of the Risk and Reward Indicator scale. This is because it invests in the shares of
companies, whose values tend to fl uctuate more widely.
The following risks may not be fully captured by the Risk and Reward Indicator:
Currency exchange: Changes in the relative values of different currencies may adversely affect the value of the Fund’s
investments and any related income.
Derivatives: The use of derivatives is not intended to increase the overall level of risk in the Fund. However, the use of
derivatives may still lead to large changes in the value of the Fund and includes the potential for large fi nancial loss.
Equity investment: The value of equities (e.g. shares) and equity-related investments may vary according to company
profi ts and future prospects as well as more general market factors. In the event of a company default (e.g. bankruptcy),
the owners of their equity rank last in terms of any fi nancial payment from that company.
Investing in China: Investment in mainland China may involve a higher risk of fi nancial loss when compared with
countries generally regarded as being more developed.
Third party operational: The Fund’s operations depend on third parties. Investors in the Fund may suffer disruption or
fi nancial loss in the event of third-party operational failure.
*The Risk and Reward profi le is taken from the Key Investor Information Document. Please note that, the Risk and Reward profi le section is
based on Sterling “A” Class Accumulation shares.
The full list of the Fund’s risks are contained in Appendix VII of the Investec Funds Series iii prospectus.
1 765432
REPORT AND ACCOUNTS
Investec Funds Series iii14
Global Gold Fund
Summary of the Fund’s investment objective and policy
The Fund aims to grow the value of your investment over the long term.
The Fund invests around the world primarily in the shares of companies involved in gold mining and in related derivatives
(fi nancial contracts whose value is linked to the price of an underlying asset).
The Fund may also invest up to one-third of its value in the shares of companies involved in the mining of other precious
metals, minerals and non-precious metals.
The Investment Manager is free to choose how the Fund is invested and does not manage it with reference to an index.
Performance Record
Investec Global Gold Fund ‘A’ accumulation shares 7.95%*
Performance comparison index 8.26%**
Peer group Not applicable**
The Fund underperformed its comparison index. The underweight holdings in Newmont Mining and Barrick Gold were the
chief detractors from the Fund’s relative returns. However, our overall stock picks in gold companies were positive for
performance.
At the beginning of the period under review, the gold price traded around US$1,200 per ounce (oz), remaining within a US$80
range of this price for the fi rst four months. Its performance appeared closely linked to sentiment around the US economy
and the infl uence that this might have on the timing and path of the rate hikes by the US Federal Reserve (Fed). However,
gold prices fell dramatically in mid-July 2015, recording their biggest monthly drop in two years, to sub-US$1,100/oz – levels
last seen in 2010. It is not clear whether the People’s Bank of China’s (PBOC) disclosure of its gold holdings triggered the
event, but the gold price subsequently collapsed in what some described as a ‘speculative attack’.
While movements in the gold price have been closely related to the possibility of the Fed raising interest rates, this was
particularly prevalent over the last few months of 2015. In November, gold posted another large monthly price drop, refl ecting
the market’s belief that the Fed would raise interest rates at its December meeting. The decision to raise rates was indeed
made in December, but the tentative tone with which the Fed alluded to the likelihood of further rate hikes in 2017 has since
been positive for the yellow metal. Gold climbed 16% in the fi rst two months of 2016 as market participants considered more
rate hikes to be less likely in the year ahead. The appeal of gold as a safe haven has also increased since the turn of the year
amid concerns about global economic growth and tensions in the Middle East.
Factors hindering performance
The Fund’s underweight exposures to Newmont Mining and Barrick Gold, two of the largest companies in the index
(combined weighting of 21%), were among the biggest detractors from relative returns. Both companies have signifi cant
leverage to the gold price and participated strongly in the recent gold price recovery, hurting our underweight positions.
Exposure to platinum producers was also a drag on performance. Platinum prices fell sharply over the period as automobile
sales, which is a key end market for platinum, decreased. This affected our positions in Stillwater Mining, Anglo American
Platinum and Lonmin, all of which were sold during the period.
REPORT AND ACCOUNTS
Investec Funds Series iii 15
Factors helping performance
The Fund’s selective exposure to gold-mining companies was the largest contributor to overall performance. We were
particularly overweight Australian and South African producers which, due to the falling Australian Dollar and South African
Rand, benefi ted from reduced overall costs and higher local currency gold prices (when converted back from US dollar).
Australian company Evolution Mining was the top contributor to relative returns over the period with Northern Star Resources
and Sibanye also strongly adding to returns.
The Fund’s overweight exposure to low-cost producers with a strong production-growth outlook, such as Randgold
Resources, also contributed positively to performance.
Signifi cant purchases during the year:
Newmont Mining, Barrick Gold, Newcrest Mining, Gold Fields, AngloGold Ashanti, Agnico Eagle Mines, Randgold
Resources, Goldcorp, Detour Gold, Evolution Mining, Sibanye Gold, Franco-Nevada, Eldorado Gold, Silver Wheaton,
Yamana Gold, Northern Star Resources, Royal Gold, Fresnillo, Stillwater Mining, Guyana Goldfi elds, Source Physical Gold
P-ETC, Alamos Gold Class ‘A’
Signifi cant sales during the year:
Randgold Resources, Franco-Nevada, Royal Gold, Goldcorp, ETFS Physical Palladium, Silver Wheaton, Barrick Gold,
Source Physical Markets Palladium P-ETC, Detour Gold, AngloGold Ashanti, Acacia Mining, ETFS Physical Platinum,
B2Gold, Newmont Mining, Evolution Mining, db Physical Gold ETC, Eldorado Gold, Sibanye Gold, Agnico Eagle Mines,
Northern Star Resources, Pan African Resources, Source Physical Gold P-ETC, Gold Fields, Polyus Gold International
Outlook
We believe the gold price will continue to be driven by expectations about the Fed’s timing of US interest-rate rises.
Meanwhile, uncertainty around global growth and geopolitical risk should provide support for gold, given the effects of low
oil prices on key oil-producing countries.
With the Fed fi nally increasing interest rates in December 2015, we expect it will be the pace and timing of further hikes that
will have the greatest impact on future gold prices swings, along with concerns over global economic growth and political
stability. We expect the Fed to be more cautious when introducing further rate rises, which should lend support to the gold
price. In its commentary discussing the fi rst interest rate increase, the Fed used a more dovish tone, signalling an increased
awareness of the defl ationary impact of weak oil prices and a strong US dollar.
Meanwhile, Indian and Chinese consumers are price-sensitive buyers and we expect them to increase their consumption at
current lower prices. Central bank purchases are also set to continue for a ninth consecutive year, with China in particular
expected to increase the allocation to gold in its foreign-currency reserves. On the supply side, we anticipate gold-mine
output from major producers to stabilise and contract marginally this year and in 2017. This is a result of years of under-
investment, as gold companies have progressively slashed their exploration and growth capital expenditure since the 2011
gold-price peak.
We believe uncertainty around global growth expectations and ongoing geopolitical risk will provide a further element of
support to the gold price. The impact of lower oil prices continues to weigh on the economic growth and social stability of
several oil-producing countries. The Japanese and euro-zone economies remain fractured, while there are increasing
concerns over the ability of China to manage a ‘soft landing’ as its economic growth moderates from above-trend levels.
*Source: Morningstar, total return, income reinvested net of UK basic rate tax, no initial charge, accumulation share class (acc), net of fees
in GBP. Past performance should not be taken as a guide to the future and there is no guarantee that this investment will make profi ts.
**Index (the Euromoney Global Gold Index) shown for performance comparison purposes only. For this Fund, there is no relevant peer
group sector against which to measure fund performance.
The opinions expressed herein are as at end of February 2016.
REPORT AND ACCOUNTS
Investec Funds Series iii16
Risk and Reward profi le*
Lower risk Higher risk
Potentially lower rewards Potentially higher rewards
This indicator is based on historical data and may not be a reliable indication of the future risk profi le of the Fund. The risk
and reward category shown is not guaranteed to remain unchanged and may shift over time. The lowest category does not
mean ‘risk free’.
The value of your investment and any income from it can fall as well as rise and you are not certain of making profi ts; losses
may be made.
The Fund appears towards the higher end of the Risk and Reward Indicator scale. This is because it invests in the shares of
companies whose values tend to fl uctuate more widely.
The following risks may not be fully captured by the Risk and Reward Indicator:
Concentration: Investments may be primarily concentrated in specifi c areas (e.g. countries/geographical regions and/or
industry sectors), in terms of investment style (e.g. income or growth), in individual holdings and/or in a number of other
ways. This may mean the value of the Fund may decrease whilst more broadly invested funds might grow.
Currency exchange: Changes in the relative values of different currencies may adversely affect the value of the Fund’s
investments and any related income.
Derivatives: The use of derivatives is not intended to increase the overall level of risk in the Fund. However, the use of
derivatives may still lead to large changes in the value of the Fund and includes the potential for large fi nancial loss.
Equity investment: The value of equities (e.g. shares) and equity-related investments may vary according to company
profi ts and future prospects as well as more general market factors. In the event of a company default (e.g. bankruptcy),
the owners of their equity rank last in terms of any fi nancial payment from that company.
Liquidity: There may be insuffi cient buyers or sellers of particular investments giving rise to delays in trading and being
able to make settlements from the Fund and/or large fl uctuations in the value of the Fund which may lead to larger fi nancial
losses than might be anticipated.
Third party operational: The Fund’s operations depend on third parties. Investors in the Fund may suffer disruption or
fi nancial loss in the event of third-party operational failure.
*The Risk and Reward profi le is taken from the Key Investor Information Document. Please note that, the Risk and Reward profi le section is
based on Sterling “A” Class Accumulation shares.
The full list of the Fund’s risks are contained in Appendix VII of the Investec Funds Series iii prospectus.
1 765432
17Investec Funds Series iii
REPORT AND ACCOUNTS
MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
COLLECTIVE INVESTMENT SCHEMES 4.39% (28.02.15: 3.24%)
Investec GSF Emerging Markets Investment Grade Corporate Debt Fund † 682,153 9,484 1.79
Investec Emerging Markets Blended Debt Fund † 5,346,786 5,541 1.05
Investec GSF Onshore Renminbi Bond Fund † 339,972 4,800 0.91
Investec GSF Emerging Markets Corporate Debt Fund † 193,456 3,438 0.64 –––––––––––––––––––––––––––––––––––––––––––
23,263 4.39 ––––––––––––––––––––––––––––––––––––––––––
CORPORATE BONDS 7.35% (28.02.15: 3.58%)
Inter-American Development Bank 7.35% 12/09/2018 IDR 150,270,000,000 7,814 1.47
Petroleos Mexicanos 7.19% 12/09/2024 MXN 209,150,000 7,091 1.34
European Investment Bank 8.5% 17/09/2024 ZAR 138,450,000 5,914 1.12
America Movil 7.125% 09/12/2024 MXN 106,940,000 3,976 0.75
Transnet 9.5% 13/05/2021 ZAR 87,920,000 3,583 0.68
Morgan Stanley 11.5% 22/10/2020 BRL 14,460,000 2,590 0.49
European Investment Bank 6.95% 06/02/2020 IDR 42,380,000,000 2,145 0.40
Absa Bank 10.28% 03/05/2022 ZAR 45,000,000 2,032 0.38
European Bank for Reconstruction & Development 6.75% 12/05/2017 RUB 210,400,000 1,940 0.37
Financiera de Desarrollo Territorial 7.875% 12/08/2024 COP 10,933,000,000 1,878 0.35 –––––––––––––––––––––––––––––––––––––––––––
38,963 7.35 ––––––––––––––––––––––––––––––––––––––––––
GOVERNMENT BONDS 72.53% (28.02.15: 83.31%)
Brazil Notas do Tesouro Nacional 10% 01/01/2017 BRL 167,071,000 29,229 5.52
Brazil Notas do Tesouro Nacional 10% 01/01/2021 BRL 12,499,700 18,667 3.52
Russian Federal Bond 7.4% 19/04/2017 RUB 1,372,672,000 12,753 2.40
Hungary Government International Bond 6.375% 29/03/2021 USD 14,830,000 12,141 2.29
Turkey Government Bond 9% 08/03/2017 TRY 48,272,000 11,566 2.18
Turkey Government Bond 8.3% 20/06/2018 TRY 49,695,926 11,533 2.18
Thailand Government Bond 4.875% 22/06/2029 THB 403,741,000 10,477 1.98
Mexican Bonos 7.75% 23/11/2034 MXN 232,760,000 10,226 1.93
Turkey Government Bond 8.8% 14/11/2018 TRY 43,685,620 10,192 1.92
Poland Government Bond 5.5% 25/10/2019 PLN 39,139,000 8,000 1.51
Colombian TES 10% 24/07/2024 COP 34,528,900,000 7,977 1.50
Thailand Government Bond 3.625% 16/06/2023 THB 326,882,000 7,371 1.39
Malaysia Government Bond 4.181% 15/07/2024 MYR 41,505,000 7,232 1.36
Mexican Udibonos Infl ation Linked 4.5% 04/12/2025 MXN 28,820,000 6,898 1.30
Colombian TES 7% 04/05/2022 COP 33,293,400,000 6,635 1.25
Russian Federal Bond 7% 25/01/2023 RUB 794,110,000 6,590 1.24
South Africa Government Bond 7.25% 15/01/2020 ZAR 151,807,000 6,435 1.21
Russian Federal Bond 6.2% 31/01/2018 RUB 712,407,000 6,382 1.20
Hungary Government Bond 2.5% 22/06/2018 HUF 2,448,480,000 6,319 1.19
Poland Government Bond 5.25% 25/10/2020 PLN 29,973,000 6,184 1.17
Hungary Government Bond 7% 24/06/2022 HUF 1,929,970,000 6,129 1.16
Russian Federal Bond 6.4% 27/05/2020 RUB 720,651,000 6,102 1.15
Mexican Bonos 7.75% 29/05/2031 MXN 127,400,000 5,606 1.06
Colombian TES 7.5% 26/08/2026 COP 28,292,800,000 5,493 1.04
Turkey Government Bond 8.5% 10/07/2019 TRY 22,281,167 5,116 0.97
Malaysia Government Bond 3.314% 31/10/2017 MYR 29,298,000 5,058 0.95
Colombian TES 6% 28/04/2028 COP 29,750,000,000 4,903 0.93
Malaysia Government Bond 3.892% 15/03/2027 MYR 29,230,000 4,861 0.92
Indonesia Treasury Bond 8.375% 15/03/2034 IDR 93,068,000,000 4,829 0.91
Romania Government Bond 5.85% 26/04/2023 RON 23,370,000 4,818 0.91
Turkey Government Bond 7.4% 05/02/2020 TRY 21,735,000 4,767 0.90
Russian Federal Bond 7% 16/08/2023 RUB 544,746,000 4,483 0.85
Poland Government Bond 2% 25/04/2021 PLN 24,367,000 4,357 0.82
Turkey Government Bond 9.5% 12/01/2022 TRY 18,264,298 4,253 0.80
Hungary Government Bond 7.5% 12/11/2020 HUF 1,343,140,000 4,195 0.79
Poland Government Bond 5.75% 25/10/2021 PLN 19,151,000 4,089 0.77
Malaysia Government Bond 3.26% 01/03/2018 MYR 23,397,000 4,010 0.76
Portfolio Statement
As at 29 February 2016
Emerging Markets Local Currency Debt Fund
REPORT AND ACCOUNTS
18 Investec Funds Series iii
Portfolio Statement continued
As at 29 February 2016 MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
GOVERNMENT BONDS 72.53% (28.02.15: 83.31%) continued
Poland Government Bond 1.5% 25/04/2020 PLN 22,400,000 3,973 0.75
Russian Federal Bond 7.6% 20/07/2022 RUB 457,956,000 3,952 0.75
Poland Government Bond 4% 25/10/2023 PLN 19,735,000 3,895 0.73
Thailand Government Bond 4.75% 20/12/2024 THB 150,500,000 3,668 0.69
Romania Government Bond 4.75% 24/02/2025 RON 18,770,000 3,623 0.68
Hungary Government Bond 5.5% 20/12/2018 HUF 1,256,020,000 3,503 0.66
Mexican Bonos 8.5% 13/12/2018 MXN 80,800,000 3,501 0.66
Mexican Bonos 10% 20/11/2036 MXN 64,677,500 3,477 0.66
Indonesia Treasury Bond 9% 15/03/2029 IDR 62,813,000,000 3,464 0.65
Peruvian Government International Bond 5.7% 12/08/2024 PEN 18,359,000 3,423 0.65
Russian Federal Bond 6.7% 15/05/2019 RUB 384,240,000 3,366 0.64
Mexican Bonos 6.5% 09/06/2022 MXN 79,540,000 3,270 0.62
Russian Federal Bond 7.4% 14/06/2017 RUB 331,653,000 3,071 0.58
Peruvian Government International Bond 6.95% 12/08/2031 PEN 16,130,000 3,066 0.58
Hungary Government Bond 6% 24/11/2023 HUF 957,030,000 2,956 0.56
Russian Federal Bond 7.6% 14/04/2021 RUB 333,924,000 2,923 0.55
Thailand Government Infl ation Linked Bond 1.25% 12/03/2028 THB 154,300,000 2,888 0.54
Hungary Government Bond 5.5% 24/06/2025 HUF 907,860,000 2,750 0.52
Thailand Government Bond 3.775% 25/06/2032 THB 114,100,000 2,628 0.50
Turkey Government Bond 9% 24/07/2024 TRY 11,520,452 2,592 0.49
Brazilian Government International Bond 12.5% 05/01/2022 BRL 13,500,000 2,455 0.46
Indonesia Treasury Bond 8.375% 15/03/2024 IDR 45,247,000,000 2,435 0.46
Peruvian Government International Bond 8.2% 12/08/2026 PEN 10,715,000 2,305 0.43
Malaysia Government Bond 3.58% 28/09/2018 MYR 12,657,000 2,182 0.41
Bonos del Banco Central de Chile en Pesos 6% 01/05/2018 CLP 2,000,000,000 2,155 0.41
Russian Federal Bond 7.5% 27/02/2019 RUB 226,600,000 2,041 0.39
Brazil Notas do Tesouro Nacional 10% 01/01/2025 BRL 15,239,000 2,025 0.38
Colombian TES 7.75% 18/09/2030 COP 10,377,700,000 1,956 0.37
Russian Federal Bond 7.05% 19/01/2028 RUB 234,442,000 1,858 0.35
Russian Federal Bond 6.9% 03/08/2016 RUB 178,860,000 1,682 0.32
Hungary Government Bond 3% 26/06/2024 HUF 647,300,000 1,638 0.31
Malaysia Government Bond 4.16% 15/07/2021 MYR 7,515,000 1,320 0.25
Malaysia Government Bond 3.955% 15/09/2025 MYR 6,010,000 1,034 0.20
Colombian TES 11% 24/07/2020 COP 4,233,200,000 1,006 0.19
Philippine Government International Bond 6.25% 14/01/2036 PHP 46,000,000 751 0.14
Brazil Notas do Tesouro Nacional 10% 01/01/2018 BRL 4,330,000 730 0.14
South Africa Government Bond 8.25% 31/03/2032 ZAR 17,439,456 674 0.13
Indonesia Treasury Bond 10% 15/02/2028 IDR 11,268,000,000 666 0.13
Poland Government Bond 2.5% 25/07/2026 PLN 3,611,000 627 0.12
South Africa Government Bond 13.5% 15/09/2016 ZAR 11,982,000 555 0.10
Thailand Government Bond 4.675% 29/06/2044 THB 16,004,000 420 0.08
Russian Federal Bond 7.5% 15/03/2018 RUB 38,200,000 350 0.07
Indonesia Treasury Bond 10.25% 15/07/2027 IDR 5,700,000,000 343 0.06
Romania Government Bond 4.75% 24/06/2019 RON 1,490,000 286 0.05
Colombia Government International Bond 9.85% 28/06/2027 COP 1,110,000,000 256 0.05
Indonesia Treasury Bond 9.5% 15/07/2031 IDR 4,179,000,000 239 0.05
Colombian TES 11.25% 24/10/2018 COP 890,100,000 207 0.04
Thailand Government Bond 3.58% 17/12/2027 THB 5,000,000 115 0.02
Indonesia Treasury Bond 7% 15/05/2027 IDR 1,725,000,000 82 0.02
South Africa Government Bond 8% 31/01/2030 ZAR 1,387,582 54 0.01
Malaysia Government Bond 4.012% 15/09/2017 MYR 77,000 13 –
Russian Federal Bond 8.15% 03/02/2027 RUB 479,000 4 – –––––––––––––––––––––––––––––––––––––––––––
384,329 72.53 ––––––––––––––––––––––––––––––––––––––––––
GOVERNMENT TREASURY BILLS 1.89% (28.02.15: 0.44%)
Brazil Letras do Tesouro Nacional 01/07/2016 BRL 55,000,000 9,493 1.79
Brazil Letras do Tesouro Nacional 01/01/2018 BRL 3,610,000 507 0.10 –––––––––––––––––––––––––––––––––––––––––––
10,000 1.89 ––––––––––––––––––––––––––––––––––––––––––
CASH COLLATERAL 0.46% (28.02.15: 0.26%)
Citibank GBP 2,460,000 2,460 0.46 ––––––––––––––––––––––––––––––––––––––––––
DERIVATIVES - FUTURES 0.14% (28.02.15: (0.30%))
South African R2037 Bond Futures May 2016 3,058 223 0.04
South African R208 Bond Futures May 2016 4,927 164 0.03
South African R2030 Bond Futures May 2016 1,500 95 0.02
South African R207 Bond Futures May 2016 4,097 93 0.02
South Korea 10 Year Bond Futures March 2016 151 82 0.02
19Investec Funds Series iii
REPORT AND ACCOUNTS
MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
DERIVATIVES - FUTURES 0.14% (28.02.15: (0.30%))
South Korea 3 Year Bond Futures March 2016 486 45 0.01
United States Treasury Notes 10 Year Futures June 2016 (190) 20 –
United States Treasury Notes 5 Year Futures June 2016 (74) 8 –
United States Treasury Notes 2 Year Futures June 2016 (11) 2 – –––––––––––––––––––––––––––––––––––––––––––
732 0.14 ––––––––––––––––––––––––––––––––––––––––––
DERIVATIVES - INTEREST RATE SWAPS (0.38%) (28.02.15: (0.26%))
Goldman Sachs Interest Rate Swap receive 15.705% 02/01/2019 103,119,841 346 0.07
Goldman Sachs Interest Rate Swap receive 2.46% 21/01/2026 63,323,000 290 0.05
Deutsche Bank Interest Rate Swap receive 5.75% 01/05/2018 8,000,000 191 0.04
Citibank Interest Rate Swap pay 4.4% 22/10/2020 36,650,143 172 0.03
Citibank Interest Rate Swap receive 1.44% 27/01/2019 8,460,098,853 162 0.03
Goldman Sachs Interest Rate Swap receive 15.59% 02/01/2018 32,311,862 132 0.03
Goldman Sachs Interest Rate Swap receive 15.332% 02/01/2018 32,133,899 97 0.02
Goldman Sachs Interest Rate Swap receive 15.27% 02/01/2018 32,190,467 90 0.01
Citibank Interest Rate Swap receive 1.45% 26/01/2019 3,835,253,000 76 0.01
Citibank Interest Rate Swap pay 15.72% 02/01/2019 4,670,146 16 –
Citibank Interest Rate Swap receive 1.5% 25/02/2021 703,569,444 8 –
Goldman Sachs Interest Rate Swap pay 1.155% 24/02/2021 15,137,000 (3) –
Citibank Interest Rate Swap receive 15.56% 04/01/2021 11,751,633 (13) –
Goldman Sachs Interest Rate Swap pay 15.55% 04/01/2021 31,627,087 (32) (0.01)
Goldman Sachs Interest Rate Swap pay 9.32% 14/01/2046 24,100,000 (59) (0.01)
Goldman Sachs Interest Rate Swap pay 0.94% 08/12/2025 69,322,182 (76) (0.01)
Goldman Sachs Interest Rate Swap pay 9.3121% 14/01/2046 38,600,000 (92) (0.02)
Goldman Sachs Interest Rate Swap pay 9.3685% 19/01/2046 39,900,000 (108) (0.02)
Goldman Sachs Interest Rate Swap pay 9.3656% 20/01/2046 40,650,000 (109) (0.02)
Citibank Interest Rate Swap receive 15.25% 03/01/2017 68,396,876 (145) (0.03)
Goldman Sachs Interest Rate Swap pay 15.22% 03/01/2017 137,493,121 (282) (0.05)
Citibank Interest Rate Swap pay 1.245% 09/07/2020 149,230,000 (947) (0.18)
Citibank Interest Rate Swap receive 8.59% 02/01/2018 42,568,248 (1,702) (0.32) –––––––––––––––––––––––––––––––––––––––––––
(1,988) (0.38) ––––––––––––––––––––––––––––––––––––––––––
DERIVATIVES - TOTAL RETURN SWAPS 6.18% (28.02.15: 5.69%)
Indonesian Government 10.5% 15/08/2030 170,000,000,000 10,480 1.97
Indonesian Government 12.8% 15/06/2021 75,000,000,000 4,822 0.91
Indonesian Government 11% 15/09/2025 65,000,000,000 4,053 0.76
Indonesian Government 10% 15/02/2028 65,000,000,000 3,844 0.73
Indonesian Government 10.25% 15/07/2027 52,000,000,000 3,128 0.59
Indonesian Government 9.5% 15/07/2031 50,000,000,000 2,863 0.54
Indonesian Government 10.25% 15/07/2022 45,000,000,000 2,645 0.50
Indonesian Government 11.75% 15/08/2023 15,000,000,000 953 0.18 –––––––––––––––––––––––––––––––––––––––––––
32,788 6.18 ––––––––––––––––––––––––––––––––––––––––––
FORWARD FOREIGN EXCHANGE CONTRACTS 0.92% (28.02.15: (0.36%))
FORWARD CROSS CURRENCY CONTRACTS
Buy ARS 141,630,000 for USD (11,261,309) (1,567) (0.30)
Buy BRL 153,450,000 for USD (38,551,579) (140) (0.03)
Buy CLP 33,704,806,000 for USD (46,882,966) 1,143 0.22
Buy CNH 512,192,263 for USD (78,136,506) (29) (0.01)
Buy COP 122,689,816,784 for USD (38,401,037) (1,269) (0.24)
Buy CZK 525,575,000 for USD (21,377,003) (161) (0.03)
Buy EGP 38,995,000 for USD (3,795,252) 19 0.01
Buy EUR 12,439,924 for PLN (54,829,000) (116) (0.02)
Buy EUR 31,688,000 for USD (34,509,339) (3) -
Buy GHS 76,010,000 for USD (18,154,882) 478 0.09
Buy HUF 3,229,400,000 for EUR (10,249,787) 110 0.02
Buy HUF 13,179,910,000 for USD (45,697,823) 341 0.06
Buy IDR 751,284,601,750 for USD (54,095,928) 1,439 0.27
Buy ILS 74,220,000 for USD (18,974,504) 12 -
Buy INR 3,637,574,000 for USD (53,856,962) (602) (0.11)
Buy KES 3,386,396,000 for USD (31,711,053) 793 0.15
Buy KRW 82,719,095,852 for USD (69,544,853) (2,010) (0.38)
Buy MXN 1,057,358,000 for USD (61,408,018) (2,506) (0.47)
Buy MYR 194,191,877 for USD (44,561,861) 1,099 0.21
Buy NGN 5,716,175,544 for USD (23,923,673) (345) (0.07)
Buy PEN 245,589,742 for USD (71,432,053) (1,327) (0.25)
Buy PHP 1,571,979,000 for USD (33,150,816) (52) (0.01)
Buy PLN 53,479,000 for EUR (11,921,519) 280 0.05
REPORT AND ACCOUNTS
20 Investec Funds Series iii
Portfolio Statement continued
As at 29 February 2016 MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
FORWARD FOREIGN EXCHANGE CONTRACTS 0.92% (28.02.15: (0.36%)) continued
FORWARD CROSS CURRENCY CONTRACTS continued
Buy PLN 350,181,041 for USD (87,513,992) 24 0.01
Buy RON 183,340,000 for USD (44,314,222) 196 0.04
Buy RUB 5,692,541,050 for USD (75,883,341) (847) (0.16)
Buy SGD 40,719,000 for USD (28,555,812) 279 0.05
Buy THB 1,665,347,733 for USD (46,226,972) 358 0.07
Buy TRY 355,930,000 for USD (118,259,633) 979 0.18
Buy TWD 892,529,000 for USD (26,817,976) (32) (0.01)
Buy UGX 40,332,633,000 for USD (11,115,771) 265 0.05
Buy USD 8,900,268 for ARS (141,630,001) (332) (0.06)
Buy USD 79,380,647 for BRL (318,049,954) 526 0.10
Buy USD 48,635,709 for CLP (35,249,703,000) (1,482) (0.28)
Buy USD 117,467,717 for CNH (778,483,000) (96) (0.02)
Buy USD 5,451,435 for CNY (35,050,000) 75 0.02
Buy USD 37,569,191 for COP (127,196,043,000) (303) (0.06)
Buy USD 21,519,306 for CZK (530,768,557) 113 0.02
Buy USD 14,317,743 for EUR (13,195,000) (37) (0.01)
Buy USD 16,842,175 for GHS (82,300,000) (2,288) (0.43)
Buy USD 57,808,474 for HUF (16,603,249,984) (256) (0.05)
Buy USD 38,253,899 for IDR (534,702,234,000) (1,202) (0.23)
Buy USD 51,468,508 for ILS (199,175,000) 364 0.07
Buy USD 53,091,474 for INR (3,639,587,000) 28 0.01
Buy USD 31,186,711 for KES (3,541,260,944) (1,518) (0.29)
Buy USD 75,747,085 for KRW (88,831,765,000) 2,926 0.55
Buy USD 34,924,551 for MXN (617,688,000) 779 0.15
Buy USD 28,995,634 for MYR (123,349,726) (200) (0.04)
Buy USD 17,787,995 for NGN (4,349,841,428) (584) (0.11)
Buy USD 88,221,445 for PEN (304,893,315) 1,316 0.25
Buy USD 29,485,515 for PHP (1,421,393,000) (307) (0.06)
Buy USD 56,288,242 for PLN (223,575,000) 284 0.06
Buy USD 33,879,247 for RON (138,963,000) 62 0.01
Buy USD 132,957,424 for RUB (9,516,234,537) 5,864 1.11
Buy USD 29,278,329 for SGD (41,199,000) (4) -
Buy USD 15,883,643 for THB (573,976,000) (159) (0.03)
Buy USD 116,374,362 for TRY (350,125,649) (932) (0.18)
Buy USD 66,995,194 for TWD (2,248,100,000) (319) (0.06)
Buy USD 2,196,282 for UGX (8,334,890,000) (128) (0.02)
Buy USD 71,331,110 for ZAR (1,097,911,000) 2,269 0.43
Buy USD 12,117,741 for ZMW (158,600,000) (822) (0.16)
Buy ZAR 1,600,807,000 for USD (95,636,150) 2,733 0.52
Buy ZMW 156,943,127 for USD (10,801,991) 1,672 0.32 –––––––––––––––––––––––––––––––––––––––––––
4,851 0.92 ––––––––––––––––––––––––––––––––––––––––––
Portfolio of investments^ 495,398 93.48
Net other assets 34,553 6.52 –––––––––––––––––––––––––––––––––––––––––––
Net assets 529,951 100.00 ––––––––––––––––––––––––––––––––––––––––––
Unless otherwise stated the above securities are ordinary shares or common stock and admitted to offi cial stock exchange listings.
The collective investment schemes investments, cash collateral, total return swaps, interest rate swaps, and forward foreign exchange contracts are not listed.
^ Including derivative liabilities.
† A related party to the Fund.
Derivatives can be exchange traded or Over the Counter (OTC) contracts.
21Investec Funds Series iii
REPORT AND ACCOUNTS
29.02.2016 28.02.2015
MARKET % OF MARKET % OF
VALUE NET VALUE NET
ASSET (£’000) ASSETS (£’000) ASSETS
Bonds 423,292 79.88 1,135,876 86.89
Cash Collateral 2,460 0.46 3,400 0.26
Collective Investment Schemes 23,263 4.39 42,447 3.24
Derivatives 31,532 5.94 67,254 5.13
Forward Foreign Exchange Contracts 4,851 0.92 (4,728) (0.36)
Government Treasury Bills 10,000 1.89 5,662 0.44
Net other assets 34,553 6.52 57,572 4.40
Net assets 529,951 100.00 1,307,483 100.00
29.02.2016 28.02.2015
MARKET % OF MARKET % OF
VALUE NET VALUE NET
CREDIT BREAKDOWN* (£’000) ASSETS (£’000) ASSETS
AAA 17,813 3.36 53,918 4,12
AA 2,155 0.41 9,710 0.74
A 112,264 21.19 378,840 28.97
BBB 130,708 24.65 487,632 37.33
BB 160,352 30.27 200,554 15.33
B – – 5,222 0.40
Total bonds 423,292 79 .88 1,135,876 86.89
*Bond ratings are Investec approximations.
Portfolio Analysis
As at 29 February 2016
REPORT AND ACCOUNTS
22 Investec Funds Series iii
MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
COLLECTIVE INVESTEMENT SCHEMES 0.00% (28.02.15: 4.76%)
CORPORATE BONDS 16.12% (28.02.15: 13.95%)
Enel Finance International 5.125% 07/10/2019 USD 395,000 310 0.39
GE Capital UK Funding 5.875% 04/11/2020 GBP 240,000 282 0.35
Wal-Mart Stores 1.9% 08/04/2022 EUR 331,000 282 0.35
Deutsche Bahn Finance 4.875% 12/03/2019 EUR 300,000 271 0.34
Sanofi 0.875% 22/09/2021 EUR 300,000 243 0.31
Daimler 2.375% 16/12/2021 GBP 240,000 241 0.30
Statoil 3.7% 01/03/2024 USD 330,000 238 0.30
Ooredoo International Finance 5% 19/10/2025 USD 300,000 234 0.30
AA Bond 4.2487% 31/07/2043 GBP 220,000 225 0.28
Medtronic 2.75% 01/04/2023 USD 309,000 224 0.28
Hutchison Whampoa International 12 II 2% 08/11/2017 USD 310,000 224 0.28
Comision Federal de Electricidad 4.875% 26/05/2021 USD 300,000 222 0.28
Wellcome Trust 1.125% 21/01/2027 EUR 270,000 211 0.26
Swisscom via Lunar Funding V 1.75% 15/09/2025 EUR 250,000 208 0.26
Imperial Tobacco Finance 7.75% 24/06/2019 GBP 174,000 204 0.26
WPP 6% 04/04/2017 GBP 195,000 204 0.26
UBS Group Funding Jersey 2.125% 04/03/2024 EUR 260,000 203 0.25
CPUK Finance 2.666% 28/02/2042 GBP 200,000 200 0.25
ITV 2.125% 21/09/2022 EUR 248,000 199 0.25
Time Warner Entertainment 8.375% 15/03/2023 USD 220,000 195 0.24
Toyota Motor Credit 1.8% 23/07/2020 EUR 233,000 195 0.25
Anheuser-Busch InBev Worldwide 8.2% 15/01/2039 USD 180,000 191 0.24
Johnson & Johnson 5.5% 06/11/2024 GBP 150,000 189 0.24
Orange 3.125% 09/01/2024 EUR 200,000 181 0.23
Deutsche Telekom International Finance 2.75% 24/10/2024 EUR 200,000 181 0.23
United Technologies 6.125% 15/07/2038 USD 200,000 180 0.23
BPCE 2.875% 16/01/2024 EUR 200,000 178 0.23
Telenor 2.625% 06/12/2024 EUR 200,000 177 0.22
Telekom Finanzmanagement 3.125% 03/12/2021 EUR 190,000 166 0.21
Siemens Financieringsmaatschappij 6.125% 14/09/2066 GBP 165,000 166 0.21
Iberdrola International 1.75% 17/09/2023 EUR 200,000 163 0.20
Kraft Heinz Foods 2% 30/06/2023 EUR 200,000 161 0.20
Danone 1.25% 30/05/2024 EUR 200,000 160 0.20
LYB International Finance II 1.875% 02/03/2022 EUR 200,000 157 0.20
Bank of America 3.875% 01/08/2025 USD 210,000 156 0.20
Mizuho Financial Group Cayman 2 4.2% 18/07/2022 USD 200,000 150 0.19
Bunge Ltd Finance 3.5% 24/11/2020 USD 205,000 149 0.19
CRH America 3.875% 18/05/2025 USD 200,000 147 0.18
Tencent 3.8% 11/02/2025 USD 200,000 146 0.18
McDonald’s 3.625% 20/05/2021 USD 190,000 145 0.18
Harvest Operations 2.125% 14/05/2018 USD 200,000 145 0.18
Swedbank 2.2% 04/03/2020 USD 200,000 143 0.18
Alibaba 3.6% 28/11/2024 USD 200,000 142 0.18
Praxair 1.2% 12/02/2024 EUR 175,000 140 0.18
DIRECTV 3.8% 15/03/2022 USD 190,000 139 0.18
Apple 2.4% 03/05/2023 USD 195,000 139 0.18
Teva Pharmaceutical Finance 3.65% 10/11/2021 USD 188,000 138 0.17
Vodafone 1.75% 25/08/2023 EUR 170,000 135 0.17
Pfi zer 3.4% 15/05/2024 USD 175,000 133 0.17
International Business Machines 3.375% 01/08/2023 USD 175,000 131 0.16
Amgen 4.375% 05/12/2018 EUR 150,000 130 0.16
EMD Finance 3.25% 19/03/2025 USD 185,000 130 0.16
Pepsi Bottling 7% 01/03/2029 USD 131,000 130 0.16
ISS Global 1.125% 07/01/2021 EUR 165,000 130 0.16
Portfolio Statement
As at 29 February 2016
Global Bond Fund
23Investec Funds Series iii
REPORT AND ACCOUNTS
MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
CORPORATE BONDS 16.12% (28.02.15: 13.95%) continued
Verizon Communications 7.75% 01/12/2030 USD 134,000 127 0.16
Omnicom 3.625% 01/05/2022 USD 175,000 127 0.16
JPMorgan Chase 4.95% 25/03/2020 USD 161,000 127 0.16
Morgan Stanley 7.3% 13/05/2019 USD 150,000 124 0.16
Procter & Gamble 2.7% 02/02/2026 USD 165,000 121 0.15
Walt Disney 3% 13/02/2026 USD 160,000 120 0.15
Westpac Banking 2.625% 14/12/2022 GBP 120,000 119 0.15
Shell International Finance 6.375% 15/12/2038 USD 138,000 114 0.14
Express Scripts 3.3% 25/02/2021 USD 155,000 112 0.14
HSBC Bank Capital Funding Sterling 1 5.844% Perpetual GBP 110,000 112 0.14
Goldman Sachs 3.5% 23/01/2025 USD 150,000 107 0.13
Amgen 4% 13/09/2029 GBP 100,000 102 0.13
America Movil 6.375% 01/03/2035 USD 120,000 97 0.12
Alliander 2.875% 14/06/2024 EUR 100,000 91 0.11
Eandis 2.875% 07/05/2029 EUR 100,000 90 0.11
Enbw International Finance 2.5% 04/06/2026 EUR 100,000 85 0.11
Acea 2.625% 15/07/2024 EUR 100,000 84 0.11
Fortum 2.25% 06/09/2022 EUR 100,000 83 0.10
Nationwide Building Society 4.125% 20/03/2023 EUR 100,000 81 0.10
Unilever 1% 03/06/2023 (London listing) EUR 100,000 81 0.10
Svenska Handelsbanken 2.656% 15/01/2024 EUR 100,000 81 0.10
Unilever 1% 03/06/2023 (Berlin listing) EUR 100,000 81 0.10
CRH Funding 1.875% 09/01/2024 EUR 100,000 81 0.10
DS Smith 2.25% 16/09/2022 EUR 100,000 80 0.10
Telefonica Emisiones 1.477% 14/09/2021 EUR 100,000 79 0.10
Solvay 1.625% 02/12/2022 EUR 100,000 79 0.10
Anheuser-Busch InBev Finance 3.3% 01/02/2023 USD 100,000 74 0.09
Harley-Davidson Financial Services 2.85% 15/01/2021 USD 100,000 73 0.09
AT&T 3% 30/06/2022 USD 90,000 64 0.08
Cooperatieve Rabobank 11% Perpetual USD 75,000 64 0.08
Carnival 3.95% 15/10/2020 USD 80,000 61 0.08
BMW US Capital 1.125% 18/09/2021 EUR 40,000 32 0.04
Kellogg 3.25% 01/04/2026 USD 44,000 32 0.04
–––––––––––––––––––––––––––––––––––––––––––
12,848 16.12 ––––––––––––––––––––––––––––––––––––––––––
GOVERNMENT BONDS 72.39% (28.02.15: 68.80%)
United States Treasury Note 4.625% 15/02/2040 USD 6,754,000 6,830 8.57
Norway Government Bond 3% 14/03/2024 NOK 67,348,000 6,375 8.00
United States Treasury Note 2.125% 15/08/2021 USD 7,616,000 5,718 7.17
Bundesobligation 0% 09/04/2021 EUR 6,760,000 5,420 6.80
Bundesobligation 0.25% 16/10/2020 EUR 6,625,000 5,373 6.74
Hungary Government Bond 2.5% 27/10/2021 HUF 1,530,000,000 3,897 4.89
Province of Quebec Canada 4.25% 01/12/2021 CAD 5,643,000 3,439 4.31
Bundesrepublik Deutschland 4.75% 04/07/2034 EUR 2,386,000 3,238 4.06
Czech Republic Government Bond 2.4% 17/09/2025 CZK 67,360,000 2,334 2.93
Israel Government Bond 2.25% 31/05/2019 ILS 10,805,000 2,108 2.64
Queensland Treasury 4.75% 21/07/2025 AUD 3,417,000 2,030 2.56
Western Australian Treasury 5% 23/07/2025 AUD 3,333,000 2,003 2.51
Development Bank of Japan 1.7% 20/09/2022 JPY 215,000,000 1,539 1.93
Israel Government Bond 6% 28/02/2019 ILS 5,470,000 1,179 1.48
Bundesrepublik Deutschland 4% 04/01/2037 EUR 685,000 885 1.11
France Government Bond 4% 25/10/2038 EUR 723,000 869 1.09
United Kingdom Treasury 4.25% 07/06/2032 GBP 652,000 860 1.08
Development Bank of Japan 2.3% 19/03/2026 JPY 100,000,000 784 0.98
Switzerland Government Bond 2% 25/05/2022 CHF 700,000 594 0.75
Sweden Government Bond 5% 01/12/2020 SEK 4,845,000 509 0.64
United States Treasury Note 2.75% 15/11/2023 USD 576,000 451 0.57
Norway Government Bond 1.75% 13/03/2025 NOK 4,900,000 423 0.53
REPORT AND ACCOUNTS
24 Investec Funds Series iii
Portfolio Statement continued
As at 29 February 2016 MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
GOVERNMENT BONDS 72.39% (28.02.15: 68.80%) continued
United States Treasury Note 2.5% 15/02/2045 USD 489,000 344 0.43
United Kingdom Treasury 2% 07/09/2025 GBP 261,000 276 0.35
Australia Government Bond 2.75% 21/06/2035 AUD 430,000 215 0.27
Turkey Government Bond 9.4% 08/07/2020 TRY 6,834 2 –
–––––––––––––––––––––––––––––––––––––––––––
57,695 72.39 ––––––––––––––––––––––––––––––––––––––––––
CASH COLLATERAL 0.00% (28.02.15: 0.12%)
DERIVATIVES - CREDIT DEFAULT SWAPS 0.00% (28.02.15: (0.13%))
DERIVATIVES - FUTURES (0.13%) (28.02.15: 0.19%)
Japan 10 Year Bond March 2016 10 89 0.11
Euro-Bund Futures March 2016 34 81 0.10
Euro-BOBL Futures March 2016 49 31 0.04
South Korea 10 Year Futures Bond March 2016 107 31 0.04
South Korea 3 Year Futures Bond March 2016 104 10 0.01
Sterling 90 Day Futures September 2016 (310) 3 –
Australia 3 Year Bond March 2016 28 – –
US Long Bond Futures June 2016 2 (1) –
US Treasury Note 5 Year Futures June 2016 41 (4) (0.01)
UK Long Gilt Bond Futures June 2016 (85) (8) (0.01)
US Treasury Note 2 Year Futures June 2016 50 (9) (0.01)
Canada 10 Year Bond June 2016 97 (13) (0.02)
Bank Accept Futures December 2017 158 (17) (0.02)
Euro-Schatz Futures March 2016 (198) (46) (0.06)
Euro-Buxl Futures March 2016 (5) (63) (0.08)
Australia 10 Year Bond March 2016 (95) (179) (0.22)
–––––––––––––––––––––––––––––––––––––––––––
(95) (0.13) ––––––––––––––––––––––––––––––––––––––––––
FORWARD FOREIGN EXCHANGE CONTRACTS 2.82% (28.02.15: 0.75%)
Forward Currency Contracts
Euro
Buy EUR 3,454,040 for GBP (2,603,583) 111 0.14
Sell EUR (1,212,623) for GBP 900,967 (52) (0.07)
Indian Rupee
Buy IDR 2,548,000,000 for GBP (116,774) 21 0.03
US Dollar
Buy USD 38,127,271 for GBP (26,025,783) 1,497 1.88
Sell USD (29,941,646) for GBP 20,642,000 (972) (1.22)
–––––––––––––––––––––––––––––––––––––––––––
605 0.76 ––––––––––––––––––––––––––––––––––––––––––
Forward Cross Currency Contracts
Buy AUD 17,790,000 for USD (12,592,950) 81 0.10
Buy BRL 23,365,430 for USD (5,857,186) (21) (0.03)
Buy CAD 776,000 for MXN (9,946,355) 20 0.03
Buy CAD 3,890,248 for USD (2,827,957) 30 0.04
Buy CHF 1,369,000 for JPY (169,634,159) (97) (0.12)
Buy CHF 10,278,000 for USD (10,315,258) (36) (0.04)
Buy CLP 1,001,307,636 for USD (1,387,525) 38 0.05
Buy CNH 24,511,000 for USD (3,706,471) 22 0.03
Buy COP 3,456,052,212 for USD (1,089,765) (42) (0.05)
Buy CZK 208,477,000 for USD (8,422,002) (22) (0.03)
Buy EUR 1,940,147 for HUF (604,932,000) (5) (0.01)
Buy EUR 564,791 for NOK (5,481,000) (10) (0.01)
Buy EUR 1,329,518 for PLN (5,894,095) (19) (0.02)
Buy EUR 25,781,988 for USD (28,098,844) (13) (0.02)
Buy HUF 1,156,606,349 for USD (4,057,258) (4) (0.01)
Buy IDR 22,304,610,000 for USD (1,588,987) 55 0.07
Buy ILS 25,162,000 for USD (6,467,792) (21) (0.03)
Buy INR 201,097,543 for USD (2,977,380) (33) (0.04)
Buy JPY 3,598,740,107 for USD (30,039,530) 1,319 1.65
Buy KRW 5,485,729,085 for USD (4,673,490) (178) (0.22)
Buy MXN 309,270,593 for USD (17,022,962) (55) (0.07)
Buy MXN 54,914,857 for ZAR (46,700,000) 78 0.10
Buy MYR 18,013,000 for USD (4,201,428) 53 0.07
Buy NOK 4,932,000 for MXN (9,916,279) 16 0.02
Buy NOK 64,057,000 for USD (7,286,112) 43 0.05
25Investec Funds Series iii
REPORT AND ACCOUNTS
MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%
FORWARD FOREIGN EXCHANGE CONTRACTS 2.82% (28.02.15: 0.75%) continued
Forward Cross Currency Contracts
Buy NZD 6,685,000 for USD (4,415,164) (6) (0.01)
Buy PEN 11,057,000 for USD (3,238,675) (76) (0.10)
Buy PHP 57,570,000 for USD (1,215,711) (3) –
Buy PLN 20,693,000 for EUR (4,773,989) 2 –
Buy PLN 85,024,000 for USD (21,038,383) 158 0.20
Buy RON 870,000 for USD (210,679) 1 –
Buy SEK 41,223,697 for EUR (4,365,000) 47 0.06
Buy SEK 117,192,914 for USD (13,838,262) (102) (0.13)
Buy SGD 1,407,000 for USD (983,834) 12 0.02
Buy THB 6,067,000 for USD (167,538) 2 –
Buy TWD 153,161,000 for USD (4,654,860) (44) (0.06)
Buy USD 8,960,780 for AUD (12,437,366) 57 0.07
Buy USD 5,944,112 for BRL (23,435,736) 71 0.09
Buy USD 7,836,341 for CAD (10,920,000) (159) (0.20)
Buy USD 17,747,546 for CHF (17,708,626) 43 0.06
Buy USD 1,496,129 for CLP (1,066,740,000) (27) (0.03)
Buy USD 3,762,370 for CNH (24,527,000) 17 0.02
Buy USD 1,083,357 for COP (3,464,684,000) 35 0.04
Buy USD 6,133,778 for CZK (152,039,000) 11 0.01
Buy USD 37,022,922 for EUR (33,651,883) 270 0.34
Buy USD 5,736,022 for HUF (1,607,877,000) 75 0.09
Buy USD 1,759,950 for IDR (24,929,685,000) (73) (0.09)
Buy USD 11,068,294 for ILS (43,213,000) 8 0.01
Buy USD 2,924,919 for INR (198,134,000) 27 0.03
Buy USD 14,164,902 for JPY (1,692,680,000) (595) (0.74)
Buy USD 7,197,225 for KRW (8,672,398,000) 143 0.18
Buy USD 14,477,194 for MXN (252,084,000) 480 0.60
Buy USD 5,750,001 for MYR (24,361,178) (23) (0.03)
Buy USD 22,037,987 for NOK (191,289,664) 73 0.09
Buy USD 4,385,933 for NZD (6,668,000) (7) (0.01)
Buy USD 3,131,332 for PEN (11,032,016) 23 0.03
Buy USD 1,199,287 for PHP (57,170,000) (3) –
Buy USD 20,891,182 for PLN (83,041,917) 94 0.12
Buy USD 222,859 for RON (918,000) – –
Buy USD 15,184,387 for SEK (129,041,773) 74 0.09
Buy USD 2,491,618 for SGD (3,523,053) (9) (0.01)
Buy USD 169,472 for THB (6,082,802) (1) –
Buy USD 6,092,208 for TWD (203,187,984) (2) –
Buy USD 2,545,434 for ZAR (38,367,070) 117 0.15
Buy ZAR 46,700,000 for MXN (56,173,609) (128) (0.16)
Buy ZAR 32,220,140 for USD (2,194,399) (140) (0.18)
–––––––––––––––––––––––––––––––––––––––––––
1,641 2.06
––––––––––––––––––––––––––––––––––––––––––
Portfolio of investments^ 72,694 91.20
Net other assets 7,010 8.80
–––––––––––––––––––––––––––––––––––––––––––
Net assets 79,704 100.00
––––––––––––––––––––––––––––––––––––––––––
Unless otherwise stated the above securities are admitted to offi cial stock exchange listings.
The collective investment schemes investments, cash collateral and the forward foreign exchange contracts are not listed.
Derivatives can be exchange traded or Over the Counter (OTC) contracts.
^ Including derivative liabilities.
REPORT AND ACCOUNTS
26 Investec Funds Series iii
Portfolio Analysis
As at 29 February 2016 29.02.2016 28.02.2015
MARKET % OF MARKET % OF
VALUE NET VALUE NET
ASSET (£’000) ASSETS (£’000) ASSETS
Bonds 70,543 88.51 88,148 82.75
Cash Collateral – – 120 0.12
Collective Investment Schemes – – 5,076 4.76
Derivatives (95) (0.13) 74 0.06
Forward Foreign Exchange Contracts 2,246 2.82 802 0.75
Net other assets 7,010 8.80 12,316 11.56
Net assets 79,704 100.00 106,536 100.00
29.02.2016 28.02.2015
MARKET % OF MARKET % OF
VALUE NET VALUE NET
CREDIT BREAKDOWN* (£’000) ASSETS (£’000) ASSETS
AAA 23,432 29.40 26,561 24.93
AA 27,199 34.13 39,677 37.25
A 10,079 12.64 11,364 10.65
BBB 5,733 7.20 9,928 9.33
BB 3,897 4.89 618 0.59
NR 203 0.25 – –
Total bonds 70,543 88.51 88,148 82.75
*Bond ratings are Investec approximations.
27Investec Funds Series iii
REPORT AND ACCOUNTS
MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
AUSTRALIA 1.77% (28.02.15: 2.86%)
Woodside Petroleum 862,283 11,275 1.77 ––––––––––––––––––––––––––––––––––––––––––
BELGIUM 0.00% (28.02.15: 1.95%)
BRAZIL 1.85% (28.02.15: 1.41%)
Itau Unibanco ADR 2,581,223 11,739 1.85 ––––––––––––––––––––––––––––––––––––––––––
CANADA 0.90% (28.02.15: 2.63%)
Valeant Pharmaceuticals International 120,257 5,712 0.90 ––––––––––––––––––––––––––––––––––––––––––
CAYMAN ISLANDS 2.01% (28.02.15: 0.00%)
CK Hutchison 1,464,287 12,775 2.01 ––––––––––––––––––––––––––––––––––––––––––
CHINA 0.00% (28.02.15: 1.33%)
FRANCE 1.98% (28.02.15: 1.60%)
Cap Gemini 210,321 12,591 1.98 ––––––––––––––––––––––––––––––––––––––––––
GERMANY 0.00% (28.02.15: 1.59%)
GUERNSEY 2.19% (28.02.15: 0.00%)
Amdocs 335,349 13,925 2.19 ––––––––––––––––––––––––––––––––––––––––––
HONG KONG 3.70% (28.02.15: 4.76%)
AIA 3,537,000 12,990 2.04
BOC Hong Kong 5,649,074 10,570 1.66 –––––––––––––––––––––––––––––––––––––––––––
23,560 3.70 ––––––––––––––––––––––––––––––––––––––––––
IRELAND 2.30% (28.02.15: 2.15%)
Medtronic 262,462 14,642 2.30 ––––––––––––––––––––––––––––––––––––––––––
ISRAEL 3.87% (28.02.15: 1.78%)
Check Point Software Technologies 248,851 14,844 2.33
Teva Pharmaceutical Industries ADR 244,110 9,798 1.54 –––––––––––––––––––––––––––––––––––––––––––
24,642 3.87 ––––––––––––––––––––––––––––––––––––––––––
JAPAN 5.90% (28.02.15: 6.46%)
Nippon Telegraph & Telephone 506,100 15,538 2.44
Tokio Marine 493,900 12,422 1.95
Sumitomo Mitsui Financial 476,700 9,629 1.51 –––––––––––––––––––––––––––––––––––––––––––
37,589 5.90 ––––––––––––––––––––––––––––––––––––––––––
MEXICO 1.87% (28.02.15: 1.46%
Grupo Mexico 7,897,790 11,869 1.87 ––––––––––––––––––––––––––––––––––––––––––
NETHERLANDS 1.81% (28.02.15: 2.03%)
NXP Semiconductors 220,338 11,486 1.81 ––––––––––––––––––––––––––––––––––––––––––
NORWAY 0.00% (28.02.15: 1.67%)
SPAIN 4.16% (28.02.15: 3.36%)
Red Electrica 234,913 13,383 2.10
Amadeus IT 449,322 13,099 2.06 –––––––––––––––––––––––––––––––––––––––––––
2 6,482 4.1 6 ––––––––––––––––––––––––––––––––––––––––––
Portfolio Statement
As at 29 February 2016
Global Dynamic Fund
REPORT AND ACCOUNTS
28 Investec Funds Series iii
Portfolio Statement continued
As at 29 February 2016
MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
SWITZERLAND 2.00% (28.02.15: 2.92%)
Roche 68,636 12,731 2.00 ––––––––––––––––––––––––––––––––––––––––––
TAIWAN 0.00% (28.02.15: 1.88%)
THAILAND 0.00% (28.02.15: 1.67%)
UNITED KINGDOM 5.46% (28.02.15: 5.17%)
British American Tobacco 332,624 12,979 2.04
Cobham 4,395,147 11,296 1.78
Rio Tinto 548,977 10,436 1.64
–––––––––––––––––––––––––––––––––––––––––––
34,711 5.46 ––––––––––––––––––––––––––––––––––––––––––
UNITED STATES 55.35% (28.02.15: 47.23%)
Fiserv 228,571 15,779 2.48
Philip Morris International 237,524 15,609 2.45
Vantiv 410,232 15,411 2.42
Johnson & Johnson 200,510 15,229 2.39
Paypal 551,411 15,182 2.39
Priceline 15,865 14,490 2.28
Comcast 342,017 14,253 2.24
AT&T 528,273 14,091 2.22
Cisco Systems 738,801 13,963 2.19
Cardinal Health 235,658 13,899 2.18
ServiceMaster Global 504,658 13,818 2.17
Cigna 137,072 13,815 2.17
Valero Energy 318,037 13,794 2.17
Western Union 1,046,156 13,790 2.17
Activision Blizzard 596,276 13,632 2.14
CVS Health 191,940 13,463 2.12
MEDNAX 270,168 13,075 2.07
eBay 746,498 12,826 2.02
Gilead Sciences 189,050 11,907 1.87
American International 326,805 11,843 1.86
Alliance Data Systems 75,302 11,423 1.80
Ally Financial 892,995 11,333 1.78
St Jude Medical 280,195 10,860 1.71
Citigroup 369,726 10,369 1.63
Voya Financial 463,203 9,816 1.54
Thor Industries 231,444 9,253 1.45
Jones Lang LaSalle 124,691 9,188 1.44
–––––––––––––––––––––––––––––––––––––––––––
352,111 55.35 ––––––––––––––––––––––––––––––––––––––––––
Portfolio of investments 617,840 97.12
Net other assets 18,305 2.88
–––––––––––––––––––––––––––––––––––––––––––
NET ASSETS 636,145 100.00 ––––––––––––––––––––––––––––––––––––––––––
Unless otherwise stated the above securities are ordinary shares or common stock and admitted to offi cial stock exchange listings.
Stocks shown as ADR’s represent American Depositary Receipts.
29Investec Funds Series iii
REPORT AND ACCOUNTS
MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
AUSTRALIA 0.00% (28.02.15: 1.06%)
AUSTRIA 0.00% (28.02.15: 0.34%)
BELGIUM 0.84% (28.02.15: 2.02%)
KBC 65,029 2,473 0.84 ––––––––––––––––––––––––––––––––––––––––––
BERMUDA 0.55% (28.02.15: 0.60%)
Hongkong Land 381,000 1,615 0.55 ––––––––––––––––––––––––––––––––––––––––––
BRAZIL 0.00% (28.02.15: 0.81%)
CANADA 2.56% (28.02.15: 2.45%)
Canadian Imperial Bank of Commerce 57,313 2,746 0.93
Alimentation Couche-Tard 81,801 2,667 0.90
Canadian Natural Resources 81,406 1,226 0.42
Valeant Pharmaceuticals International 19,087 907 0.31 –––––––––––––––––––––––––––––––––––––––––––
7,546 2.56 ––––––––––––––––––––––––––––––––––––––––––
CAYMAN ISLANDS 1.55% (28.02.15: 0.00%)
CK Hutchison 229,819 2,005 0.68
Cheung Kong Property 436,242 1,608 0.55
ANTA Sports Products 579,000 946 0.32 –––––––––––––––––––––––––––––––––––––––––––
4,559 1.55 ––––––––––––––––––––––––––––––––––––––––––
CHINA 3.48% (28.02.15: 3.52%)
China Construction Bank 5,722,782 2,407 0.82
Kweichow Moutai 83,830 1,985 0.67
PICC Property & Casualty 1,618,261 1,761 0.60
Ping An Insurance 552,000 1,692 0.57
Zhengzhou Yutong Bus 590,356 1,231 0.42
Jiangsu Expressway 1,422,900 1,193 0.40 –––––––––––––––––––––––––––––––––––––––––––
10,269 3.48 ––––––––––––––––––––––––––––––––––––––––––
FRANCE 2.68% (28.02.15: 1.38%)
Pernod Ricard 31,112 2,381 0.81
Publicis 43,378 1,924 0.65
BNP Paribas 57,616 1,912 0.65
Cap Gemini 28,198 1,688 0.57 –––––––––––––––––––––––––––––––––––––––––––
7,905 2.68 ––––––––––––––––––––––––––––––––––––––––––
GERMANY 3.03% (28.02.15: 2.72%)
SAP 54,886 2,994 1.02
Continental 17,818 2,554 0.87
ProSiebenSat.1 Media 54,817 2,011 0.68
Evonik Industries 62,620 1,364 0.46 –––––––––––––––––––––––––––––––––––––––––––
8,923 3.03 ––––––––––––––––––––––––––––––––––––––––––
GUERNSEY 0.92% (28.02.15: 0.94%)
Amdocs 65,274 2,710 0.92 ––––––––––––––––––––––––––––––––––––––––––
HONG KONG 2.06% (28.02.15: 3.62%)
AIA 782,800 2,875 0.97
BOC Hong Kong 921,926 1,725 0.58
CNOOC 2,045,436 1,508 0.51 –––––––––––––––––––––––––––––––––––––––––––
6,108 2.06 ––––––––––––––––––––––––––––––––––––––––––
Portfolio Statement
As at 29 February 2016
Global Equity Fund
REPORT AND ACCOUNTS
30 Investec Funds Series iii
Portfolio Statement continued
As at 29 February 2016 MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
IRELAND 1.09% (28.02.15: 0.50%)
Willis Towers Watson 24,324 1,979 0.67
Jazz Pharmaceuticals 13,717 1,238 0.42 –––––––––––––––––––––––––––––––––––––––––––
3,217 1.09 ––––––––––––––––––––––––––––––––––––––––––
ISRAEL 2.77% (28.02.15: 1.51%)
Teva Pharmaceutical Industries ADR 66,083 2,652 0.90
Check Point Software Technologies 38,995 2,326 0.79
Nice Systems ADR 37,199 1,609 0.55
Mellanox Technologies 42,583 1,552 0.53 –––––––––––––––––––––––––––––––––––––––––––
8,139 2.77 ––––––––––––––––––––––––––––––––––––––––––
ITALY 0.00% (28.02.15: 0.42%)
JAPAN 10.24% (28.02.15: 7.99%)
Nippon Telegraph & Telephone 113,400 3,482 1.18
KDDI 186,000 3,419 1.16
Sompo Japan Nipponkoa 126,100 2,619 0.89
Japan Tobacco 89,200 2,559 0.87
Sumitomo Mitsui Financial 123,400 2,492 0.85
Japan Airlines 89,700 2,315 0.79
Tokio Marine 83,900 2,110 0.72
Sekisui House 175,900 2,067 0.70
Fuji Heavy Industries 79,100 1,868 0.63
Komatsu 151,000 1,658 0.56
Nitto Denko 42,900 1,638 0.56
Fuji Electric 503,000 1,244 0.42
Tosoh 450,000 1,234 0.42
Sumitomo Chemical 314,000 989 0.34
Resona 176,500 445 0.15 –––––––––––––––––––––––––––––––––––––––––––
30,139 10.24 ––––––––––––––––––––––––––––––––––––––––––
JERSEY 0.85% (28.02.15: 1.10%)
Shire 64,884 2,497 0.85 ––––––––––––––––––––––––––––––––––––––––––
MALAYSIA 0.00% (28.02.15: 0.75%)
NETHERLANDS 3.25% (28.02.15: 1.81%)
Mylan 78,778 2,680 0.90
ING 268,381 2,278 0.77
NXP Semiconductors 33,367 1,740 0.59
NN 74,289 1,656 0.56
ASM International 41,974 1,276 0.43 –––––––––––––––––––––––––––––––––––––––––––
9,630 3.25 ––––––––––––––––––––––––––––––––––––––––––
NORWAY 0.50% (28.02.15: 2.00%)
Yara International 52,151 1,463 0.50 ––––––––––––––––––––––––––––––––––––––––––
PUERTO RICO 0.00% (28.02.15: 0.57%)
SINGAPORE 0.88% (28.02.15: 0.00%)
Broadcom 27,031 2,597 0.88 ––––––––––––––––––––––––––––––––––––––––––
SOUTH KOREA 0.91% (28.02.15: 1.01%)
Samsung Electronics 3,906 2,686 0.91 ––––––––––––––––––––––––––––––––––––––––––
SPAIN 1.46% (28.02.15: 1.30%)
Red Electrica 45,389 2,586 0.88
Amadeus IT 58,234 1,698 0.58 –––––––––––––––––––––––––––––––––––––––––––
4,284 1.46 ––––––––––––––––––––––––––––––––––––––––––
SWITZERLAND 3.08% (28.02.15: 5.58%)
Nestlé 80,093 4,028 1.37
Roche 18,971 3,519 1.19
Adecco 36,492 1,523 0.52 –––––––––––––––––––––––––––––––––––––––––––
9,070 3.08 ––––––––––––––––––––––––––––––––––––––––––
31Investec Funds Series iii
REPORT AND ACCOUNTS
MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
TAIWAN 1.70% (28.02.15: 1.54%)
Taiwan Semiconductor Manufacturing 1,109,000 3,577 1.21
Novatek Microelectronics 491,000 1,445 0.49 –––––––––––––––––––––––––––––––––––––––––––
5,022 1.70 ––––––––––––––––––––––––––––––––––––––––––
THAILAND 0.00% (28.02.15: 0.64%)
UNITED KINGDOM 5.40% (28.02.15: 4.11%)
BT 899,899 4,369 1.48
Imperial Tobacco 87,066 3,256 1.10
National Grid 323,621 3,111 1.05
Barratt Developments 492,029 2,876 0.98
Rio Tinto 66,508 1,264 0.43
ARRIS International 63,070 1,077 0.36 –––––––––––––––––––––––––––––––––––––––––––
15,953 5.40 ––––––––––––––––––––––––––––––––––––––––––
UNITED STATES 48.95% (28.02.15: 47.04%)
AT&T 190,957 5,094 1.73
PepsiCo 70,737 4,995 1.69
Pfi zer 212,195 4,545 1.54
Comcast 101,330 4,223 1.43
UnitedHealth 47,223 4,060 1.38
Cisco Systems 195,985 3,704 1.26
Citigroup 128,254 3,597 1.22
Thermo Fisher Scientifi c 37,556 3,503 1.19
Gilead Sciences 52,734 3,321 1.13
Tyson Foods 68,164 3,186 1.07
CVS Health 44,402 3,115 1.06
Valero Energy 71,743 3,112 1.06
American International 84,759 3,072 1.04
Philip Morris International 46,111 3,030 1.03
Zimmer Biomet 41,900 2,928 0.99
Apple 41,594 2,903 0.98
Paypal 104,386 2,874 0.97
Honeywell International 38,763 2,836 0.96
Vantiv 75,008 2,818 0.95
AmerisourceBergen 42,476 2,656 0.90
Cigna 26,253 2,646 0.90
Public Service Enterprise 84,589 2,605 0.88
Activision Blizzard 113,155 2,587 0.88
Afl ac 59,942 2,576 0.87
Occidental Petroleum 51,352 2,551 0.87
IDEX 46,829 2,541 0.86
EMC 129,930 2,451 0.83
CBS 69,244 2,418 0.82
Priceline 2,609 2,383 0.81
Marathon Petroleum 88,708 2,193 0.74
St Jude Medical 56,548 2,192 0.74
Alliance Data Systems 14,130 2,143 0.73
Southwest Airlines 70,577 2,137 0.72
Fiserv 30,846 2,129 0.72
Hess 65,393 2,058 0.70
SunTrust Banks 85,265 2,042 0.69
Western Union 154,660 2,039 0.69
Alaska Air 37,342 1,992 0.68
Morgan Stanley 110,185 1,965 0.66
American Financial 39,109 1,894 0.64
Generac 75,249 1,887 0.64
eBay 106,752 1,834 0.62
Voya Financial 82,825 1,755 0. 59
Quest Diagnostics 36,219 1,740 0.59
Foot Locker 36,459 1,645 0.56
Celanese 37,103 1,616 0.55
AMC Networks 32,903 1,557 0.53
Ally Financial 122,165 1,550 0.53
Lear 20,551 1,504 0.51
Synaptics 24,094 1,413 0.48
Prestige Brands 39,659 1,400 0.4 7
REPORT AND ACCOUNTS
32 Investec Funds Series iii
Portfolio Statement continued
As at 29 February 2016 MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
UNITED STATES 48.95% (28.02.15: 47.04%) (continued)
Hewlett-Packard Enterprise 145,861 1,397 0.47
WestRock 57,302 1,397 0.47
Big Lots 44,952 1,313 0.45
Jones Lang LaSalle 17,541 1,292 0.44
Regal Beloit 32,190 1,268 0.43
Starz 66,271 1,205 0.41
ServiceMaster Global 43,688 1,196 0.41
Thor Industries 29,325 1,172 0.40
Helmerich & Payne 30,165 1,153 0.39 –––––––––––––––––––––––––––––––––––––––––––
144,408 48.95 ––––––––––––––––––––––––––––––––––––––––––
Portfolio of investments 291,213 98.75
Net other assets 3,673 1.25 –––––––––––––––––––––––––––––––––––––––––––
NET ASSETS 294,886 100.00 ––––––––––––––––––––––––––––––––––––––––––
Unless otherwise stated the above securities are ordinary shares or common stock and admitted to offi cial stock exchange listings.
Stocks shown as ADR’s represent American Depositary Receipts.
33Investec Funds Series iii
REPORT AND ACCOUNTS
MARKET PERCENTAGE
VALUE OF NET ASSETS
ASSET HOLDING (£’000) (%)
AUSTRALIA 17.56% (28.02.15: 3.30%)
Newcrest Mining 668,473 6,024 9.54
Northern Star Resources 1,044,292 2,101 3.33
Evolution Mining 2,160,435 1,945 3.08
Independence 431,619 568 0.90
St Barbara 468,398 449 0.71 –––––––––––––––––––––––––––––––––––––––––––
11,087 17.56 ––––––––––––––––––––––––––––––––––––––––––
BERMUDA 0.00% (28.02.15: 2.05%)
CANADA 47.24% (28.02.15: 49.30%)
Barrick Gold 618,239 6,199 9.82
Agnico Eagle Mines 160,311 4,065 6.44
Franco-Nevada 69,960 3,009 4.76
Goldcorp 263,119 2,729 4.32
Detour Gold 169,751 1,926 3.05
Yamana Gold 790,038 1,614 2.56
Eldorado Gold 663,268 1,432 2.27
SEMAFO 552,334 1,412 2.24
Alamos Gold Class ‘A’ 397,409 1,312 2.08
Silver Wheaton 105,502 1,201 1.90
Tahoe Resources 163,918 1,092 1.73
Osisko Gold Royalties 94,581 704 1.11
Pretium Resources 199,366 671 1.06
Guyana Goldfi elds 285,416 661 1.05
Centerra Gold 163,455 648 1.03
Roxgold 968,500 428 0.68
OceanaGold 191,398 381 0.59
Lake Shore Gold 359,734 349 0.55 –––––––––––––––––––––––––––––––––––––––––––
29,833 47.24 ––––––––––––––––––––––––––––––––––––––––––
IRELAND 0.00% (28.02.15: 4.37%)
JERSEY 6.19% (28.02.15: 20.11%)
Randgold Resources 42,728 2,822 4.47
Centamin 1,177,439 1,086 1.72 –––––––––––––––––––––––––––––––––––––––––––
3,908 6.19 ––––––––––––––––––––––––––––––––––––––––––
MEXICO 2.60% (28.02.15: 2.74%)
Fresnillo 161,336 1,642 2.60 ––––––––––––––––––––––––––––––––––––––––––
RUSSIA 0.00% (28.02.15: 1.56%)
SOUTH AFRICA 13.72% (28.02.15: 4.67%)
Sibanye Gold 1,189,107 3,079 4.88
Gold Fields 942,465 2,845 4.50
AngloGold Ashanti 303,811 2,739 4.34 –––––––––––––––––––––––––––––––––––––––––––
8,663 13.72 ––––––––––––––––––––––––––––––––––––––––––
UNITED KINGDOM 0.00% (28.02.15: 6.12%)
UNITED STATES 11.61% (28.02.15: 4.51%)
Newmont Mining 324,111 6,044 9.57
Royal Gold 38,437 1,287 2.04 –––––––––––––––––––––––––––––––––––––––––––
7,331 11.61 ––––––––––––––––––––––––––––––––––––––––––
Portfolio of investments 62,464 98.92
Net other assets 682 1.08 –––––––––––––––––––––––––––––––––––––––––––
NET ASSETS 63,146 100.00 ––––––––––––––––––––––––––––––––––––––––––
Unless otherwise stated the above securities are ordinary shares or common stock and admitted to offi cial stock exchange listings.
Portfolio Statement
As at 29 February 2016
Global Gold Fund
REPORT AND ACCOUNTS
Investec Funds Series iii34
Authorised Corporate Director’s report
The Authorised Corporate Director (“ACD”) of Investec Funds Series iii (the “Company”) is Investec Fund Managers Limited.
The ACD is the sole director of the Company.
Authorised status
The Company is an investment company with variable capital incorporated in England and Wales under registered number
IC13 and authorised by the Financial Conduct Authority (“FCA”) (formerly the Financial Services Authority) with effect from 6
August 1998.
The Company is structured as an umbrella company, in that different sub-funds (the “Funds”) may be established from time
to time by the ACD with the approval of the FCA. The Company currently comprises of fi ve Funds.
The Company (and therefore the Funds) has been certifi ed by the FCA as complying with the conditions necessary for it to
enjoy rights conferred by the EC Directive on Undertakings for Collective Investment in Transferable Securities (“UCITS”). The
Company has an unlimited duration.
The assets of each Fund will be treated as separate from those of every other Fund and will be invested in accordance with
the investment objective and policy applicable to that Fund. Investment of the assets of each of the Funds must comply with
the FCA Collective Investment Scheme (“COLL”) Sourcebook and the investment objective and policy of the relevant Fund.
Under English law, the Funds are segregated portfolios of assets and the assets of a Fund belong exclusively to that Fund.
The assets of a Fund shall not be used or made available to discharge (directly or indirectly) the liabilities of, or claims against, any
other person or body, including the Company and any other Fund and shall not be available for any such purpose.
Subject to the above, each Fund will be charged with the liabilities, expenses, costs and charges of the Company
attributable to that Fund, and within each Fund charges will be allocated between share classes in accordance with their
terms of issue. Any assets, liabilities, expenses, costs or charges not attributable to a particular Fund may be allocated by
the ACD in a manner which it believes is fair to the shareholders generally. This will normally be pro rata to the net asset
value of the relevant Funds. Shareholders are not liable for the debts of the Company.
Accounting period covered by these accounts
The accounting period covered in these accounts is from 1 March 2015 to 29 February 2016.
Changes during the accounting period
Changes made following required notice:
After consultation with the Depositary and in accordance with the requirements of Section 4.3 of the COLL, shareholders
were given notice of the following:
(1) On 30 January 2015 of the change of the current income share classes name from “income” (“Inc”) to “income 2”
(“Inc-2”) on Emerging Markets Local Currency Debt Fund effective 6 April 2015. Although the name of the share class
changed, there is no change to the way in which the charges and expenses of the share class are being charged
against the capital value of the share class. For current “accumulation” (“Acc”) shareholders, effective 6 April 2015,
charges and expenses are paid for in the fi rst instance out of income earned rather than the capital value of the share
class. Should there be insuffi cient income, then the remainder will be paid out of the capital value of the share class.
The expenses on this fund are now charged at share class level rather than at fund level.
(2) On 30 July 2015 of the increase in the limits that certain Funds were able to invest in. The Funds in the Company were
previously limited to investing only 5% of their assets in other Funds. Effective 5 October 2015, this limit was increased
to 10% to bring these Funds in line with the others in the Investec OEIC Fund range; and
(3) On 30 July 2015, of the decrease in the initial charge on all share classes of the Funds in the Company to 0% effective
from 5 October 2015.
REPORT AND ACCOUNTS
Investec Funds Series iii 35
The following share class was launched
Global Dynamic Fund, I, Accumulation, Net, EUR (launched 07 April 2015)
Other changes
In accordance with the Client Assets Sourcebook (“CASS”) rules issued by the FCA, the ACD will operate under the Delivery
versus Payment Exemption (“DvP Exemption”) in relation to subscriptions and redemptions with effect from 18 May 2015.
The DvP Exemption allows the ACD two small periods of time during which the ACD can process a Shareholder’s money
without holding it in a client money account (as detailed in CASS, an account designed to protect a Shareholder’s rights to
money). In summary, these exceptions are:
(1) for subscriptions of Shares into the Funds, where money is provided to the ACD from the Shareholder earlier than the
relevant settlement date for the Shares, the money will be held in the ACD’s corporate bank account and transferred to
a client money account or to the relevant Fund at the latest by the end of the business day after the ACD received the
money from the Shareholder; or
(2) for redemptions of Shares in the Funds, where money is received from the Fund by the ACD to pay the Shareholder for
the redemption, this money may be held in a corporate bank account prior to payment to the Shareholder and if not
paid by the ACD to the Shareholder at the latest by the end of the business day after receipt from the Fund, the money
will be transferred to a client money account. Typically the ACD would only not have paid the money to the Shareholder
within this period after immediately on receipt from the Fund if the ACD had not received completed redemption
documentation from the Shareholder.
The auditor of the Company changed from KPMG Audit plc to KPMG LLP effective April 2015.
Anne Gallagher, Domenico Ferrini and John Green resigned as directors of the ACD effective May 2015
Adam Fletcher and John McNab were appointed as directors of the ACD effective May 2015.
There have been no fundamental changes to the Company or the Funds that required shareholder approval or any other
signifi cant changes to the operation of the Company or Funds requiring pre-notifi cation not set out in this report.
K. McFarland D. Aird
Director of the ACD Director of the ACD
22 April 2016
REPORT AND ACCOUNTS
Investec Funds Series iii36
Statement of Authorised Corporate Director’s (ACD) responsibilities
The ACD is responsible for the management of the Company in accordance with its Instrument of Incorporation, Prospectus
and the Regulations. The Financial Conduct Authority’s (formerly the Financial Services Authority) Collective Investment
Schemes Sourcebook requires the ACD to prepare Report and Accounts for each annual accounting period that give a true
and fair view of the state of affairs of the Company and of its income and expenditure, and gains/losses for the period.
The ACD confi rms that suitable accounting policies have been used and applied consistently, and reasonable and prudent
judgements and estimates have been made in the preparation of the Report and Accounts for the year ended 29 February
2016. The Report and Accounts comply with the disclosure requirements of the Statement of Recommended Practice for
Authorised Funds issued by the IMA. The ACD also confi rms that applicable accounting standards have been followed and
that the Report and Accounts have been prepared on a going concern basis, with the exception of the Global Bond Fund.
The Fund has seen its assets decline signifi cantly and the Investment Manager does not expect signifi cant demand for the
Fund in the foreseeable future. The lack of new investment into the Fund and the reduction in assets will further reduce the
investment opportunities available to the Fund. The Investment Manager therefore believes it to be in the interest of all
shareholders to close the Fund in accordance with the Financial Conduct Authority (the “FCA”) rules. Consequently the Fund
is not a going concern and the fi nancial statements have been prepared on a break up basis. There is no impact on the
fi nancial statements or disclosure notes of the Fund on the basis that the assets and liabilities on the balance sheet are
valued at fair value and costs relating to the disposal of assets and settlement of liabilities are deemed to be not material.
The ACD is responsible for keeping proper accounting records, for safeguarding the assets of the Company and hence for
taking reasonable steps for the prevention and detection of fraud and other irregularities.
The Report and Accounts are published on the www.investecassetmanagement.com website, which is a website maintained
by Investec Asset Management Limited (“Investec”). The maintenance and integrity of the website maintained by Investec or
any of its subsidiaries is, so far as it relates to the Company, the responsibility of Investec. The work carried out by the
auditors does not involve consideration of the maintenance and integrity of this website and accordingly, the auditors accept
no responsibility for any changes that have occurred to the fi nancial statements since they were initially presented on the
website. Visitors to the website need to be aware that legislation in the United Kingdom governing the preparation and
dissemination of the accounts may differ from legislation in their jurisdiction.
REPORT AND ACCOUNTS
Investec Funds Series iii 37
Statement of Depositary’s Responsibilities
Statement of Depositary’s responsibilities in respect of the Company and Report of the
Depositary to the shareholders of Investec Funds Series iii for the year ended
29 February 2016
The Depositary is responsible for the safekeeping of all of the property of the Company (other than tangible moveable
property) which is entrusted to it. It is the duty of the Depositary to take reasonable care to ensure that the Company is
managed in accordance with the Financial Conduct Authority’s Collective Investment Scheme Sourcebook (COLL), the
Open-Ended Investment Companies Regulations 2001 (SI 2001/1228) (the OEIC Regulations) and the Company’s Instrument
of Incorporation, in relation to the pricing of, and dealings in, shares in the Company; the application of income of the
Company; and the investment and borrowing powers of the Company.
Having carried out such procedures as we consider necessary to discharge our responsibilities as Depositary of the
Company, it is our opinion, based on the information available to us and the explanations provided, that in all material
respects the Company, acting through the Authorised Corporate Director:
(i) has carried out the issue, sale, redemption and cancellation, and calculation of the price of the Company’s shares and
the application of the Company’s income in accordance with the COLL and, where applicable, the OEIC Regulations
and the Instrument of Incorporation of the Company; and
(ii) has observed the investment and borrowing powers and restrictions applicable to the Company.
State Street Trustees LimitedLondon
22 April 2016
Statement of Depositary’s responsibilities in respect of the Company and Report of the
Depositary to the shareholders of Investec Funds Series iii for the year ended
29 February 2016
The Depositary is responsible for the safekeeping of all of the property of the Company (other than tangible moveable
property) which is entrusted to it. It is the duty of the Depositary to take reasonable care to ensure that the Company is
managed in accordance with the Financial Conduct Authority’s Collective Investment Scheme Sourcebook (COLL), the
Open-Ended Investment Companies Regulations 2001 (SI 2001/1228) (the OEIC Regulations) and the Company’s Instrument
of Incorporation, in relation to the pricing of, and dealings in, shares in the Company; the application of income of the
Company; and the investment and borrowing powers of the Company.
Having carried out such procedures as we consider necessary to discharge our responsibilities as Depositary of the
Company, it is our opinion, based on the information available to us and the explanations provided, that in all material
respects the Company, acting through the Authorised Corporate Director:
(i) has carried out the issue, sale, redemption and cancellation, and calculation of the price of the Company’s shares and
the application of the Company’s income in accordance with the COLL and, where applicable, the OEIC Regulations
and the Instrument of Incorporation of the Company; and
(ii) has observed the investment and borrowing powers and restrictions applicable to the Company.
State Street Trustees LimitedLondon
22 April 2016
REPORT AND ACCOUNTS
Investec Funds Series iii38
Independent auditor’s report to the shareholders of Investec Series iii (‘the Company’)
We have audited the fi nancial statements of the Company for the year ended 29 February 2016 which comprise the
Statements of Total Return, the Statements of Changes in Net Assets Attributable to Shareholders, the Balance Sheets, the
Related Notes and Distribution Tables for each of the Company’s sub-funds listed on page 1 and the accounting policies set
out on page 53. The fi nancial reporting framework that has been applied in their preparation is applicable law and United
Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including FRS 102 The Financial
Reporting Standard applicable in the UK and Republic of Ireland.
This report is made solely to the Company’s shareholders, as a body, in accordance with Rule 4.5.12 of the Collective
Investment Schemes sourcebook (‘the COLL Rules’) issued by the Financial Conduct Authority under the Open-Ended
Investment Companies Regulations 2001. Our audit work has been undertaken so that we might state to the Company’s
shareholders those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s
shareholders as a body, for our audit work, for this report, or for the opinions we have formed.
Respective responsibilities of the Authorised Corporate Director (‘the ACD’) Investec Fund Managers
Limited and auditor
As explained more fully in the Statement of ACD’s Responsibilities set out on page 36 the ACD is responsible for the
preparation of fi nancial statements which give a true and fair view. Our responsibility is to audit, and express an opinion on,
the fi nancial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those
standards require us to comply with the Auditing Practices Board’s Ethical Standards for Auditors.
Scope of the audit of the fi nancial statements
A description of the scope of an audit of fi nancial statements is provided on the Financial Reporting Council’s website at
www.frc.org.uk/auditscopeukprivate.
Opinion on fi nancial statements
In our opinion the fi nancial statements:
• give a true and fair view, in accordance with UK Generally Accepted Accounting Practice, of the fi nancial position of
each of the sub-funds as at 29 February 2016 and of the net revenue/losses and the net capital gains/losses on the
property of each of the sub-funds for the year then ended; and
• have been properly prepared in accordance with the Instrument of Incorporation, the Statement of Recommended
Practice relating to Authorised Funds, and the COLL Rules.
Emphasis of Matter – non-going concern basis of preparation
In forming our opinion on the fi nancial statements, which is not modifi ed, we have considered the adequacy of the disclosure
made in Note 1 to the fi nancial statements which explains that the fi nancial statements have been prepared on the going
concern basis, with the exception of the Global Bond Fund which has now been prepared on a break up basis.
Opinion on other matters prescribed by the COLL Rules
In our opinion the information given in the Authorised Corporate Director’s Report is consistent with the fi nancial statements.
We have received all the information and explanations which we consider necessary for the purposes of our audit.
Independent Auditor’s Report
REPORT AND ACCOUNTS
Investec Funds Series iii 39
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where under the COLL Rules we are required to report to you if,
in our opinion:
• proper accounting records for the Company have not been kept; or
• the fi nancial statements are not in agreement with the accounting records.
Ravi Lamba for and on behalf of KPMG LLP, Statutory Auditor Chartered Accountants
15 Canada Square
London
E14 5GL
22 April 2016
REPORT AND ACCOUNTS
40 Investec Funds Series iii
Comparative table
As at 29 February 2016
Emerging Markets Local Currency Debt
‘A’ Net Class (Accumulation shares) ‘A’ Gross Class (Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 159. 56 159.94 202.85 175.40 173.67 217.65
Return before operating charges* (9. 37) 2.36 (39.86) ((8.71) 4.71 (40.77)
Operating charges (2.45) (2.70) (3.05) (2.68) (2.98) (3.21)
Return after operating charges* (11.8 2) (0.34) (42.91) (11.39) 1.73 (43.98)
Closing net asset value per share 147.74 159.56 159.94 164.01 175.40 173.67
Retained distributions on accumulation shares* 5.98 8.30 8.64 8.26 11.29 11.60
*after direct transaction costs of: 0.02 – 0.01 0.02 0.01 0.01
Performance
Return after changes (7.4 1%) (0.21%) (21.15%) (6.49%) 1.00% (20.21%)
Other information
Closing net asset value (£’000) 14,269 36,977 71,042 39,123 111,041 83,755
Closing number of shares 9,658,359 23,174,507 44,416,553 23,853,786 63,308,707 48,225,256
Operating charges 1.65% 1.64% 1.66% 1.65% 1.64% 1.66%
Direct transaction costs‡ 0.01% 0.01% 0.00% 0.01% 0.01% 0.00%
Prices
Highest share price 167.04 174.71 206.35 183.80 190.93 221.50
Lowest share price 133.25 154.84 155.47 147.56 169.74 168.70
‘A’ Gross Class (USD Accumulation shares) ‘A’ Net Class (Income-2 shares)(3)
2016 2015 2014 2016 2015 2014
Financial year (US cent) (US cent) (US cent) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 270.79 289.99 330.87 100.89 106.34 141.87
Return before operating charges* (39.33) (14.35) (35.72) (6. 30) 1.75 (27.49)
Operating charges (4.09) (4.85) (5.16) (1.5 2) (1.78) (2.12)
Return after operating charges* (43.42) (19.20) (40.88) (7. 82) (0.03) (29.61)
Distributions on income shares – – – (4. 79) (5.42) (5.92)
Closing net asset value per share 227.37 270.79 289.99 88. 28 100.89 106.34
Retained distributions on accumulation shares* 12.24 18.22 18.56 – – –
*after direct transaction costs of: 0.02 0.01 0.01 0.01 0.01 0.01
Performance
Return after charges (16.03%) (6.62%) (12.36%) (7.7 5%) (0.03%) (20.87%)
Other information
Closing net asset value (US$’000) 2,144 10,399 17,647 8,817 28,271 45,411
Closing number of shares 942,799 3,840,195 6,085,486 9,986,936 28,023,042 42,704,147
Operating charges 1.65% 1.64% 1.66% 1.65% 1.64% 1.66%
Direct transaction costs‡ 0.01% 0.01% 0.00% 0.01% 0.01% 0.01%
Prices
Highest share price 273.04 313.52 341.40 105.72 113.27 144.39
Lowest share price 217.46 267.28 277.84 80.89 99.17 104.98
41Investec Funds Series iii
REPORT AND ACCOUNTS
Comparative table
As at 29 February 2016
‘A’ Gross Class (Income-2 shares)(3) ‘I’ Net Class (Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 101.54 107.03 142.80 90.68 90.21 113.65
Return before operating charges* (5. 15) 3.10 (26.22) (5.48) 1.31 (17.61)
Operating charges (1.5 3) (1.79) (2.10) (0.75) (0.84) (0.89)
Return after operating charges* (6. 68) 1.31 (28.32) (6.23) 0.47 (18.50)
Distributions on income shares (6.0 4) (6.80) (7.45) – – –
Closing net asset value per share 88.8 2 101.54 107.03 84.45 90.68 90.21
Retained distributions on accumulation shares* – – – 3.87 4.69 4.94
*after direct transaction costs of: – 0.01 0.01 0.01 0.01 –
Performance
Return after charges (6. 58%) 1.22% (19.83%) (6.87%) 0.52% (16.28%)
Other information
Closing net asset value (£’000) 2,729 4,823 6,309 37,244 44,805 32,606
Closing number of shares 3,072,598 4,750,164 5,895,025 44,102,779 49,408,678 36,143,282
Operating charges 1.65% 1.64% 1.66% 0.90% 0.89% 0.91%
Direct transaction costs‡ 0.01% 0.01% 0.00% 0.01% 0.01% 0.00%
Prices
Highest share price 106.42 114.08 145.37 94.97 98.97 115.64
Lowest share price 81.42 99.85 105.90 76.12 87.92 87.78
‘I’ Gross Class
‘I’ Gross Class (Accumulation shares) (USD Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (US cent) (US cent) (US cent)
Change in net assets per share
Opening net asset value per share 183.22 180.12 224.44 283.04 300.83 340.50
Return before operating charges* (9.09) 4.79 (42.47) (41.27) (15.04) (36.71)
Operating charges (1.51) (1.69) (1.85) (2.34) (2.75) (2.96)
Return after operating charges* (10.60) 3.10 (44.32) (43.61) (17.79) (39.67)
Closing net asset value per share 172.62 183.22 180.12 239.43 283.04 300.83
Retained distributions on accumulation shares* 9.83 11.75 11.99 14.55 18.95 19.04
*after direct transaction costs of: 0.02 0.02 0.01 0.02 0.02 0.01
Performance
Return after charges (5.79%) 1.72% (19.75%) (15.41%) (5.91%) (11.65%)
Other information
Closing net asset value (£’000) 100,627 72,475 16,646 216,580 784,247 554,979
Closing number of shares 58,293,661 39,555,100 9,241,628 90,456,221 277,083,603 184,482,107
Operating charges 0.91% 0.89% 0.91% 0.90% 0.89% 0.91%
Direct transaction costs‡ 0.01% 0.01% 0.00% 0.01% 0.01% 0.01%
Prices
Highest share price 192.17 198.76 227.98 285.83 326.21 351.89
Lowest share price 155.05 177.04 174.85 228.81 278.95 288.07
REPORT AND ACCOUNTS
42
Comparative table
As at 29 February 2016
Investec Funds Series iii
‘I’ Net Class (Income-2 shares)(3) ‘I’ Gross Class (Income-2 shares)(2)(3)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 82. 76 86.56 114.61 94.50 100.00 _
Return before operating charges* (5. 18) 1.4 1 (2 2. 34) (4.84) (3.84) _
Operating charges (0.68) (0. 79) (0.92) (0.75) (0.20) _
Return after operating charges* (5. 86) 0.6 2 (2 3. 26) (5.59) (4.04) _
Distributions on income shares (3.95) (4.4 2) 4.79 (5.63) (1.46) _
Closing net asset value per share 72.95 82. 76 86.56 83.28 94.50 _
*after direct transaction costs of: 0.01 0.01 0.01 0.01 – _
Performance
Return after charges (7. 08%) 0.7 2% (2 0. 29%) (5.92%) (4.04%) _
Other information
Closing net asset value (£’000) 61,459 129,717 154,938 – – _
Closing number of shares 84,249,839 156,744,599 179,001,314 242,747 6,250 _
Operating charges 0.90% 0.89% 0.91% 0.91% 0.90% _
Direct transaction costs‡ 0.01% 0.01% 0.00% 0.01% 0.01% _
Prices
Highest share price 86.69 92.61 116.64 99.12 102.12 _
Lowest share price 66.74 81.23 85.42 76.23 92.73 _
‘R’ Net Class (Accumulation shares) ‘R’ Net Class (Income-2 shares)(3)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 84.85 84.63 106.86 75.93 79.45 105.47
Return before operating charges* (5.10) 1.23 (21.12) (4.77) 2.27 (20.98)
Operating charges (0.90) (1.01) (1.11) (0.79) (0.93) (1.07)
Return after operating charges* (6.00) 0.22 (22.23) (5.56) 1.34 (22.05)
Distributions on income shares – – – (3.62) (4.86) (3.97)
Closing net asset value per share 78.85 84.85 84.63 66.75 75.93 79.45
Retained distributions on accumulation shares* 3.48 4.39 4.54 – – –
*after direct transaction costs of: 0.01 0.01 – 0.01 0.01 –
Performance
Return after charges (7.07%) 0.26% (20.80%) (7.32%) 1.69% (20.91%)
Other information
Closing net asset value (£’000) 49 64 46 4 5 20
Closing number of shares 62,104 75,696 53,763 6,655 6,250 25,774
Operating charges 1.15% 1.14% 1.16% 1.15% 1.14% 1.16%
Direct transaction costs‡ 0.01% 0.01% 0.00% 0.01% 0.01% 0.00%
Prices
Highest share price 88.85 92.69 108.72 79.60 84.96 107.33
Lowest share price 71.06 82.26 82.29 61.10 74.47 78.42
43Investec Funds Series iii
REPORT AND ACCOUNTS
Comparative table
As at 29 February 2016
‘S’ Gross Class (Accumulation shares) ‘S’ Gross Class (Income shares) (1)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p)) (p)
Change in net assets per share
Opening net asset value per share 172.54 168.30 207.78 – –– 107.97
Return before operating charges* (8.51) 4.49 (39.18) – –– (11.30)
Operating charges (0.25) (0.25) (0.30) –– –– (0.13)
Return after operating charges* (8.76) 4.24 (39.48) – –– (11.43)
Distributions on income shares – – – –– –– (2.89)
Return to shareholder as a result of class closure – – – –– –– (93.65)
Closing net asset value per share 163.78 172.54 168.30 –– –– –
Retained distributions on accumulation shares* 10.36 11.03 11.16 – –– –
*after direct transaction costs of: 0.02 0.01 0.01 – –– –
Performance
Return after charges (5.08%) 2.52% (19.00%) –– –– (10.59%)
Other information
Closing net asset value (£’000) 107,532 364,265 400,939 –– –– –
Closing number of shares 65,658,179 211,113,316 238,231,635 –– –– –
Operating charges 0.15% 0.14% 0.16% – –– 0.20%
Direct transaction costs‡ 0.01% 0.01% 0.00% –– –– 0.00%
Prices
Highest share price 181.12 186.49 211.59 –– –– 109.99
Lowest share price 146.87 166.47 163.29 – –– 88.20
(1) Closed 21 October 2013
(2) Launched 5 December 2014
(3) Share class names changed effective 6 April 2015 (previously ‘Income’ classes)
High and low prices are quoted at Mid valuation.
Portfolio transaction costs
Portfolio transaction costs are incurred by funds when buying and selling investments. These costs vary depending on the types of investment, their market
capitalisation, country of exchange, method of execution and the quality of research provided. They are made up of direct and indirect portfolio transaction costs:
‡ Direct portfolio transaction costs: Broker execution commission, taxes, and costs of research from brokers and other research providers.
Indirect portfolio transaction costs: ‘Dealing spread’ – the difference between the buying and selling prices of the fund’s investments; some types of investment, such
as fi xed interest securities, have no direct transaction costs and only the dealing spread is paid. Details of the dealing spread is shown in note 5 of the ‘Notes to the
fi nancial statements’ for each of the individual funds.
REPORT AND ACCOUNTS
44 Investec Funds Series iii
Comparative table
As at 29 February 2016
Net Asset Value and Ongoing Charges Figure
‘A’ Net Class (Accumulation shares) ‘A’ Net Class (Income shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 112.28 106.96 120.82 88.93 85.73 97.96
Return before operating charges* 11.88 6.53 (12.61) 9.36 5.19 (10.18)
Operating charges (1.24) (1.21) (1.25) (0.97) (0.96) (1.02)
Return after operating charges* 10.64 5.32 (13.86) 8.39 4.23 (11.20)
Distributions on income shares – – – (0.68) (1.03) (1.03)
Closing net asset value per share 122.92 112.28 106.96 96.64 88.93 85.73
Retained distributions on accumulation shares* 0.86 1.30 1.29 – – –
*after direct transaction costs of: 0.02 – 0.02 0.02 – 0.02
Performance
Return after charges 9.48% 4.97% (11.47%) 9.43% 4.93% (11.43%)
Other information
Closing net asset value (£’000) 19,486 20,622 22,716 1,288 4,150 8,363
Closing number of shares 15,853,036 18,367,208 21,237,177 1,333,187 4,666,984 9,755,485
Operating charges 1.11% 1.10% 1.10% 1.11% 1.10% 1.10%
Direct transaction costs‡ 0.02% –% 0.02% 0.02% –% 0.02%
Prices
Highest share price 123.41 117.16 121.97 97.36 93.39 98.88
Lowest share price 105.98 105.27 106.53 83.94 84.36 85.97
‘A’ Gross Class (Income shares) ‘A’ Net Class (USD Income shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (US Cent) (US Cent) (US Cent)
Change in net assets per share
Opening net asset value per share 88.82 85.62 97.84 137.07 142.90 148.81
Return before operating charges* 9.52 5.47 (9.90) (0.73) (2.63) (3.12)
Operating charges (0.97) (0.97) (1.02) (1.50) (1.57) (1.60)
Return after operating charges* 8.55 4.50 (10.92) (2.23) (4.20) (4.72)
Distributions on income shares (0.85) (1.30) (1.30) (1.14) (1.63) (1.19)
Closing net asset value per share 96.52 88.82 85.62 133.70 137.07 142.90
*after direct transaction costs of: 0.02 – 0.02 0.02 – 0.02
Performance
Return after charges 9.63% 5.26% (11.16%) (1.63%) (2.94%) (3.17%)
Other information
Closing net asset value (£’000) 804 1,156 934 53 476 536
Closing number of shares 833,090 1,301,971 1,090,442 39,288 347,151 374,773
Operating charges 1.11% 1.10% 1.10% 1.11% 1.10% 1.10%
Direct transaction costs‡ 0.02% –% 0.02% 0.02% –% 0.02%
Prices
Highest share price 97.33 93.36 98.75 137.41 145.02 149.24
Lowest share price 83.90 84.34 85.96 130.06 137.96 140.98
Global Bond Fund
45Investec Funds Series iii
REPORT AND ACCOUNTS
Comparative table
As at 29 February 2016
‘I’ Net Class (Accumulation shares) ‘I’ Net Class (Income shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 99.49 94.44 106.24 925.40 892.03 1,019.48
Return before operating charges* 10.47 5.63 (9.67) 96.66 53.27 (107.05)
Operating charges (0.61) (0.58) (0.59) (5.61) (5.48) (5.63)
Return after operating charges* 9.86 5.05 (10.26) 91.05 47.79 (112.68)
Distributions on income shares – – – (10.66) (14.42) (14.77)
Closing net asset value per share 109.35 99.49 94.44 1,005.79 925.40 892.03
Retained distributions on accumulation shares* 1.15 1.52 – – – –
*after direct transaction costs of: 0.02 – 0.02 0.20 – 0.18
Performance
Return after charges 9.91% 5.35% (9.66%) 9.84% 5.36% (11.05%)
Other information
Closing net asset value (£’000) 4,879 1,753 1,265 4,164 4,039 4,209
Closing number of shares 4,462,173 1,761,446 1,339,216 414,036 436,410 471,819
Operating charges 0.61% 0.60% 0.60% 0.61% 0.60% 0.60%
Direct transaction costs‡ 0.02% –% 0.02% 0.02% –% 0.02%
Prices
Highest share price 109.78 103.81 107.23 1,015.03 973.62 1,029.17
Lowest share price 94.03 93.05 94.07 874.55 879.11 896.46
‘I’ Gross Class (Income shares) ‘R’ Net Class (Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 948.86 914.64 1,045.33 98.84 93.91 105.60
Return before operating charges* 102.00 58.36 (106.16) 10.43 5.75 (10.81)
Operating charges (5.73) (5.61) (5.74) (0.82) (0.82) (0.88)
Return after operating charges* 96.27 52.75 (111.90) 9.61 4.93 (11.69)
Distributions on income shares (13.80) (18.53) (18.79) – – –
Closing net asset value per share 1,031.33 948.86 914.64 108.45 98.84 93.91
Retained distributions on accumulation shares* – – – 0.98 1.41 1.62
*after direct transaction costs of: 0.21 – 0.19 0.02 – 0.02
Performance
Return after charges 10.15% 5.77% (10.70%) 9.72% 5.25% (11.07%)
Other information
Closing net asset value (£’000) 483 664 1,008 7 6 6
Closing number of shares 46,846 69,985 110,202 6,258 6,250 6,250
Operating charges 0.61% 0.60% 0.60% 0.8 6% 0.85% 0.85%
Direct transaction costs‡ 0.02% –% 0.02% 0.02% –% 0.02%
Prices
Highest share price 1,042.31 999.49 1,055.17 108.88 103.13 106.56
Lowest share price 897.64 902.51 920.18 93.35 92.53 93.44
REPORT AND ACCOUNTS
46 Investec Funds Series iii
Comparative table
As at 29 February 2016
‘S’ Net Class (Income shares) (1) ‘S’ Gross Class (Income shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share – 83.92 95.90 88.87 85.67 97.92
Return before operating charges* – 0.03 (10.22) 9.59 5.47 (9.94)
Operating charges – (0.05) (0.09) (0.10) (0.09) (0.09)
Return after operating charges* – (0.02) (10.31) 9.49 5.38 (10.03)
Distributions on income shares – – (1.67) (1.74) (2.18) (2.22)
Return to shareholder as a result of class closure – (83.90) – – – –
Closing net asset value per share – – 83.92 96.62 88.87 85.67
*after direct transaction costs of: – – 0.02 0.02 – 0.02
Performance
Return after charges – (0.02%) (10.75%) 10.68% 6.28% (10.24%)
Other information
Closing net asset value (£’000) – – 2 48,554 73,837 102,832
Closing number of shares – – 2,286 50,254,471 83,082,345 120,039,045
Operating charges – 0.10% 0.10% 0.11% 0.10% 0.10%
Direct transaction costs‡ – –% 0.02% 0.02% –% 0.02%
Prices
Highest share price – 84.71 96.80 97.86 93.82 98.84
Lowest share price – 83.41 84.45 84.20 84.68 86.36
(1) Closed 7 April 2014
Portfolio transaction costs
Portfolio transaction costs are incurred by funds when buying and selling investments. These costs vary depending on the types of investment, their market
capitalisation, country of exchange, method of execution and the quality of research provided. They are made up of direct and indirect portfolio transaction costs:
‡ Direct portfolio transaction costs: Broker execution commission, taxes, and costs of research from brokers and other research providers.
Indirect portfolio transaction costs: ‘Dealing spread’ – the difference between the buying and selling prices of the fund’s investments; some types of investment, such
as fi xed interest securities, have no direct transaction costs and only the dealing spread is paid. Details of the dealing spread is shown in note 5 of the ‘Notes to the
fi nancial statements’ for each of the individual funds.
47Investec Funds Series iii
REPORT AND ACCOUNTS
Comparative table
As at 29 February 2016
‘A’ Net Class
‘A’ Net Class (Accumulation shares) (USD Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (US cent) (US cent) (US cent)
Change in net assets per share
Opening net asset value per share 114.29 99.72 90.15 176.72 166.75 137.00
Return before operating charges* ( 3.20) 16.23 11.11 (2 2.24) 12.68 32.18
Operating charges (1. 79) (1.66) (1.54) (2.7 4) (2.71) (2.43)
Return after operating charges* (4. 99 ) 14.57 9.57 (24. 98 ) 9.97 29.75
Closing net asset value per share 109. 30 114.29 99.72 15 1.74 176.72 166.75
Retained distributions on accumulation shares* 0.12 0.18 0.30 0.18 0.29 0.47
*after direct transaction costs of: 0.12 0.06 0.14 0.12 0.06 0.14
Performance
Return after charges ( 4.37%) 14.61% 10.62% (1 4.14%) 5.98% 21.72%
Other information
Closing net asset value (£’000) 3,0 79 1,259 1,255 1,1 33 1,405 1,405
Closing number of shares 2,816,856 1,101,333 1,258,480 746,814 795,021 842,598
Operating charges 1.6 0% 1.61% 1.62% 1.6 0% 1.61% 1.62%
Direct transaction costs‡ 0.11% 0.06% 0.15% 0.11% 0.06% 0.15%
Prices
Highest share price 122.85 114.33 101.31 186.75 176.97 166.78
Lowest share price 98.34 95.57 87.12 142.10 153.09 134.36
‘B’ Class (Accumulation shares) (1) ‘I’ Net Class (Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 112.65 100.00 – 188.76 163.45 146.34
Return before operating charges* (3. 15 ) 13.09 – ( 5.28) 26.81 20.12
Operating charges (0. 67 ) (0. 43) – (1.5 8) (1.50) (1.36)
Performance fee (0.19) (0.01) – – – –
Return after operating charges* ( 4.01) 12.65 – ( 6.86) 25.31 18.76
Closing net asset value per share 10 8.64 112.65 – 18 1.90 188.76 163.45
Retained distributions on accumulation shares* 1.05 0.20 – 1.62 1.58 –
*after direct transaction costs of: 0.12 0.02 – 0.20 0.10 0.23
Performance
Return after charges ( 3.56%) 12.65% – (3. 63%) 15.48% 12.82%
Other information
Closing net asset value (£’000) 158,349 163,208 – 186,206 74,903 629
Closing number of shares 144,886,366 144,886,366 – 101,750,915 39,682,042 384,923
Operating charges 0.6 0% 0.61% – 0.8 5% 0.86% 0.87%
Performance fee 0.17% 0.01% – – – –
Direct transaction costs‡ 0.11% 0.06% – 0.11% 0.06% 0.15%
Prices
Highest share price 121.22 112.68 – 203.09 188.82 165.91
Lowest share price 97.70 93.86 – 163.60 157.39 141.93
Global Dynamic
REPORT AND ACCOUNTS
48 Investec Funds Series iii
Comparative table
As at 29 February 2016
‘I’ Net Class (EUR Accumulation shares) (2) ‘R’ Net Class (Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (Euro cent) (Euro cent) (Euro cent) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 100.00 – – 142.38 123.62 110.91
Return before operating charges* (1 3.24) – – (3. 97) 20.18 14.07
Operating charges (0.70) – – (1.5 5) (1.42) (1.36)
Return after operating charges* (13. 94) – – ( 5.52) 18.76 12.71
Closing net asset value per share 86. 06 – – 13 6.86 142.38 123.62
Retained distributions on accumulation shares* 0.64 – – 0.86 0.86 1.05
*after direct transaction costs of: 0.06 – – 0.15 0.07 0.17
Performance
Return after charges (13. 94%) – – (3. 88 %) 15.18% 11.46%
Other information
Closing net asset value (Euro’000) 27 5 – – 11 5 120 105
Closing number of shares 320,119 – – 84,225 84,225 84,850
Operating charges 0.86% – – 1.1 0% 1.11% 1.12%
Direct transaction costs‡ 0.10% – – 0.11% 0.06% 0.14%
Prices
Highest share price 104.63 – – 153.15 142.43 125.50
Lowest share price 77.34 – – 123.11 118.84 107.48
‘S’ Net Class (Accumulation shares)
2016 2015 2014
Financial year (p) (p) (p)
Change in net assets per share
Opening net asset value per share 200.10 171.99 152.89
Return before operating charges* ( 5.61) 28.31 19.30
Operating charges (0.2 0) (0.20) (0.20)
Return after operating charges* ( 5.81) 28.11 19.10
Closing net asset value per share 19 4.29 200.10 171.99
Retained distributions on accumulation 3.21 2.99 2.95
*after direct transaction costs of: 0.21 0.10 0.25
Performance
Return after charges (2. 90%) 16.34% 12.49%
Other information
Closing net asset value (£’000) 289,431 502,113 637,930
Closing number of shares 148,971,725 250,933,247 370,903,535
Operating charges 0.1 0% 0.11% 0.12%
Direct transaction costs‡ 0.11% 0.06% 0.15%
Prices
Highest share price 215.50 200.16 174.43
Lowest share price 174.68 166.04 148.59
(1) Launched 30 September 2014
(2) Launched 7 April 2015
High and low prices are quoted at Mid valuation.
Portfolio transaction costs
Portfolio transaction costs are incurred by funds when buying and selling investments. These costs vary depending on the types of investment, their market
capitalisation, country of exchange, method of execution and the quality of research provided. They are made up of direct and indirect portfolio transaction costs:
‡ Direct portfolio transaction costs: Broker execution commission, taxes, and costs of research from brokers and other research providers.
Indirect portfolio transaction costs: ‘Dealing spread’ – the difference between the buying and selling prices of the fund’s investments; some types of investment, such
as fi xed interest securities, have no direct transaction costs and only the dealing spread is paid. Details of the dealing spread is shown in note 5 of the ‘Notes to the
fi nancial statements’ for each of the individual funds.
49Investec Funds Series iii
REPORT AND ACCOUNTS
Comparative table
As at 29 February 2016
‘A’ Net Class
‘A’ Net Class (Accumulation shares) (USD Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (US cent) (US cent) (US cent)
Change in net assets per share
Opening net asset value per share 117.99 103.3 1 94.02 182.04 172.35 142.93
Return before operating charges* ( 5.33) 16.4 2 10.89 (25. 74) 12.56 31.87
Operating charges (1.88) (1.74) (1.61) (2.84) (2.87) (2.45)
Return after operating charges* ( 7.21) 14.6 8 9.28 (2 8.58) 9.69 29.42
Closing net asset value per share 110.78 117.99 103.3 1 15 3.46 182.04 172.35
Retained distributions on accumulation shares* 0.41 0.30 0.40 0.57 0.47 0.51
*after direct transaction costs of: 0.09 0.08 0.07 0.09 0.08 0.06
Performance
Return after charges ( 6.11%) 14.2 1% 9.87% (15. 70%) 5.62% 20.58%
Other information
Closing net asset value (£’000) 3,3 78 4,703 8,243 6,2 22 7,183 5,972
Closing number of shares 3,049,176 3,986,107 7,979,534 4,054,391 3,946,062 3,464,863
Operating charges 1.63% 1.62% 1.62% 1.63% 1.62% 1.62%
Direct transaction costs‡ 0.08% 0.07% 0.07% 0.08% 0.07% 0.07%
Prices
Highest share price 126.58 118.17 105.56 191.59 183.78 172.42
Lowest share price 100.50 100.52 91.48 144.92 160.69 141.13
‘I’ Net Class
‘I’ Net Class (Accumulation shares) (USD Accumulation shares) (1)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (US cent) (US cent) (US cent)
Change in net assets per share
Opening net asset value per share 1,643.71 1,428.26 1,290.16 120.46 113.20 100.00
Return before operating charges* ( 74.71) 228.71 165.49 (1 7.13) 8.27 13.74
Operating charges (13.95) (13.26) (11.68) (1.02) (1.01) (0.54)
Return after operating charges* (88 .66) 215.45 153.81 (1 8.15) 7.26 13.20
Closing net asset value per share 1,5 55.05 1,643.71 1,428.26 102. 31 120.46 113.20
Retained distributions on accumulation shares* 17.88 15.49 – 1.17 1.13 0.49
*after direct transaction costs of: 1.28 1.07 0.95 0.06 0.05 0.03
Performance
Return after charges ( 5.39%) 15.08% 11.92% (1 5.07%) 6.41% 13.20%
Other information
Closing net asset value (£’000) 14 8,954 67,264 19,831 30, 759 65,806 75,930
Closing number of shares 9,578,730 4,092,191 1,388,451 30,062,980 54,629,831 67,072,335
Operating charges 0.88% 0.87% 0.87% 0.88% 0.87% 0.87%
Direct transaction costs‡ 0.08% 0.07% 0.07% 0.08% 0.07% 0.07%
Prices
Highest share price 1,764.97 1,646.12 1,458.12 126.99 121.02 113.25
Lowest share price 1,410.22 1,392.02 1,258.34 96.60 106.03 97.88
Global Equity
REPORT AND ACCOUNTS
50 Investec Funds Series iii
Comparative table
As at 29 February 2016
‘R’ Net Class (Accumulation shares) ‘S’ Net Class (Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 141.38 123.08 111.43 127.30 109.79 98.42
Return before operating charges* ( 6.41) 19.82 12.95 (5. 79) 17.65 11.49
Operating charges (1.56) (1.52) (1.30) (0.17) (0.14) (0.12)
Return after operating charges* (7. 97) 18.30 11.65 (5. 96) 17.51 11.37
Closing net asset value per share 13 3.41 141.38 123.08 121. 34 127.30 109.79
Retained distributions on accumulation shares* 1.19 1.06 1.07 2.33 2.06 1.99
*after direct transaction costs of: 0.11 0.09 0.08 0.10 0.08 0.07
Performance
Return after charges (5. 64%) 14.87% 10.45% (4. 68%) 15.95% 11.55%
Other information
Closing net asset value (£’000) 50 53 1 11 1,781 334,395 398,806
Closing number of shares 37,293 37,293 625 92,124,557 262,689,307 363,260,879
Operating charges 1.13% 1.12% 1.12% 0.13% 0.12% 0.12%
Direct transaction costs‡ 0.08% 0.07% 0.07% 0.08% 0.07% 0.07%
Prices
Highest share price 151.76 141.59 125.80 136.81 127.47 111.98
Lowest share price 121.00 120.04 108.66 110.00 107.10 96.23
‘S’ Net Class (Income shares)
2016 2015 2014
Financial year (p) (p) (p)
Change in net assets per share
Opening net asset value per share 114.77 100.61 91.87
Return before operating charges* ( 5.23) 16.18 10.72
Operating charges (0.15) (0.13) (0.12)
Return after operating charges* ( 5.38) 16.05 10.60
Distributions on income shares (2.10) (1.89) (1.86)
Closing net asset value per share 107. 29 114.77 100.61
*after direct transaction costs of: 0.09 0.07 0.07
Performance
Return after charges (4. 69%) 15.95% 11.54%
Other information
Closing net asset value (£’000) 4,0 27 23,630 26,036
Closing number of shares 3,753,537 20,590,024 25,877,864
Operating charges 0.13% 0.12% 0.12%
Direct transaction costs‡ 0.08% 0.07% 0.07%
Prices
Highest share price 123.33 116.81 104.52
Lowest share price 99.17 98.15 89.82
(1) Launched 30 July 2013
High and low prices are quoted at Mid valuation.
Portfolio transaction costs
Portfolio transaction costs are incurred by funds when buying and selling investments. These costs vary depending on the types of investment, their market
capitalisation, country of exchange, method of execution and the quality of research provided. They are made up of direct and indirect portfolio transaction costs:
‡ Direct portfolio transaction costs: Broker execution commission, taxes, and costs of research from brokers and other research providers.
Indirect portfolio transaction costs: ‘Dealing spread’ – the difference between the buying and selling prices of the fund’s investments; some types of investment, such
as fi xed interest securities, have no direct transaction costs and only the dealing spread is paid. Details of the dealing spread is shown in note 5 of the ‘Notes to the
fi nancial statements’ for each of the individual funds.
51Investec Funds Series iii
REPORT AND ACCOUNTS
Comparative table
As at 29 February 2016
‘A’ Net Class
‘A’ Net Class (Accumulation shares) (USD Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (US cent) (US cent) (US cent)
Change in net assets per share
Opening net asset value per share 96.21 106.79 153.41 148.41 178.13 233. 05
Return before operating charges* 10.75 (8.95) (44.77) ( 0. 18 ) (27.09) (5 1. 87)
Operating charges (1.34) (1.63) (1.85) (2.02) (2.63) (3.05)
Return after operating charges* 9.41 (10.58) (46.62) ( 2. 20 ) (29.72) (5 4. 92)
Closing net asset value per share 10 5. 62 96.21 106.79 14 6.21 148.41 178.13
Retained distributions on accumulation – – – – – –
*after direct transaction costs of: 0.25 0.14 0.13 0.25 0.14 0.14
Performance
Return after charges 9. 78 % (9.91%) (30.39%) ( 1. 48%) (16.68%) (23. 57%)
Other information
Closing net asset value (£’000) 18, 913 20,523 60,516 15 9` 208 204
Closing number of shares 17,906,141 21,331,207 56,670,176 108,554 140,370 114,755
Operating charges 1.67% 1.62% 1.62% 1.68% 1.62% 1.62%
Direct transaction costs‡ 0.31% 0.14% 0.11% 0.31% 0.14% 0.12%
Prices
Highest share price 105.27 114.21 155.56 149.67 191.26 233.27
Lowest share price 64.06 79.39 90.04 98.97 126.61 147.14
‘I’ Net Class (Accumulation shares) ‘R’ Net Class (Accumulation shares)
2016 2015 2014 2016 2015 2014
Financial year (p) (p) (p) (p) (p) (p)
Change in net assets per share
Opening net asset value per share 91.57 100.87 143.83 57.24 63.21 90.32
Return before operating charges* 10.43 (8.49) (4 2. 02 ) 6. 50 (5.31) (26.37)
Operating charges (0.71) (0.81) (0.94) (0.56) (0.66) (0.74)
Return after operating charges* 9. 72 (9.30) (42.25) 5. 94 (5.97) (27.11)
Closing net asset value per share 10 1.29 91.57 100.87 6 3.18 57.24 63.21
Retained distributions on accumulation 0.09 0.24 0.71 – – 0.34
*after direct transaction costs of: 0.24 0.13 0.12 0.15 0.08 0.07
Performance
Return after charges 10. 61 % (9.22%) (29.37%) 10.38% (9.44%) (30.02%)
Other information
Closing net asset value (£’000) 4 4,072 20,573 10,353 15 63 16
Closing number of shares 43,508,475 22,466,883 10,264,033 24,326 109,351 24,951
Operating charges 0.93% 0.87% 0.87% 1.15% 1.12% 1.12%
Direct transaction costs‡ 0.31% 0.14% 0.11% 0.32% 0.14% 0.11%
Prices
Highest share price 100.96 108.26 145.87 62.97 67.76 91.58
Lowest share price 61.17 75.38 84.93 38.20 47.16 53.24
Global Gold
REPORT AND ACCOUNTS
52 Investec Funds Series iii
Comparative table
As at 29 February 2016
‘S’ Net Class (Accumulation shares)
2016 2015 2014
Financial year (p) (p) (p)
Change in net assets per share
Opening net asset value per share 97.68 106.81 151.19
Return before operating charges* 1 1.33 (9.01) (44.25)
Operating charges (0.13) (0.12) (0.13)
Return after operating charges* 1 1.20 (9.13) (44.38)
Closing net asset value per share 10 8. 88 97.68 106.81
Retained distributions on accumulation 0.71 1.01 1.53
*after direct transaction costs of: 0.27 0.13 0.12
Performance
Return after charges 1 1.47% (8.55%) (29.35%)
Other information
Closing net asset value (£’000) 31 2,002 841
Closing number of shares 28,633 2,050,008 787,691
Operating charges 0.15% 0.12% 0.12%
Direct transaction costs‡ 0.32% 0.13% 0.11%
Prices
Highest share price 108.50 115.01 153.32
Lowest share price 65.47 80.23 89.80
High and low prices are quoted at Mid valuation.
Portfolio transaction costs
Portfolio transaction costs are incurred by funds when buying and selling investments. These costs vary depending on the types of investment, their market
capitalisation, country of exchange, method of execution and the quality of research provided. They are made up of direct and indirect portfolio transaction costs:
‡ Direct portfolio transaction costs: Broker execution commission, taxes, and costs of research from brokers and other research providers.
Indirect portfolio transaction costs: ‘Dealing spread’ – the difference between the buying and selling prices of the fund’s investments; some types of investment, such
as fi xed interest securities, have no direct transaction costs and only the dealing spread is paid. Details of the dealing spread is shown in note 5 of the ‘Notes to the
fi nancial statements’ for each of the individual funds.
Investec Funds Series iii 53
REPORT AND ACCOUNTS
Notes to the Financial Statements of the CompanyFor the year ended 29 February 2016
1. Accounting policies
a) Basis of accounting
The fi nancial statements on pages 53-100 have been prepared under the historical cost basis, as modifi ed by the revaluation of investments, and in accordance with
the revised Statement of Recommended Practice (SORP) for Authorised Funds issued by the IMA in May 2014.
The fi nancial statements have been prepared on the going concern basis, with the exception of the Global Bond Fund. The Fund has seen its assets decline
signifi cantly and the Investment Manager does not expect signifi cant demand for the Fund in the foreseeable future. The lack of new investment into the Fund and the
reduction in assets will further reduce the investment opportunities available to the Fund. The Investment Manager therefore believes it to be in the interest of all
shareholders to close the Fund in accordance with the Financial Conduct Authority (the “FCA”) rules. Consequently the Fund is not a going concern and the fi nancial
statements have been prepared on a break up basis. There is no impact on the fi nancial statements or disclosure notes of the Fund on the basis that the assets and
liabilities on the balance sheet are valued at fair value and costs relating to the disposal of assets and settlement of liabilities are deemed to be not material.
Adoption of the IMA SORP 2014
Changes in accounting policies
There have been no changes to the accounting policies as detailed in the audited fi nancial statements for the year ended 29 February 2016.
Changes in presentation
The presentation of these fi nancial statements has been changed from the previous period to comply with the requirements of the IMA SORP 2014. These changes
include:
• The removal of the aggregated fi nancial statements;
• The inclusion of details on any cross holdings within the ICVC;
• Amendments to labelling of line items within the Financial Statements;
• The performance record has been replaced by a comparative table;
• New disclosures included to show share class movements, detailed portfolio transaction cost breakdown and a fair value hierarchy breakdown of the portfolio.
b) Valuation of investments
The investments of the Funds have been valued at market value at noon on 29 February 2016 net of any accrued interest. For any US and Canadian listed equity
investments held by the Funds a closing market price has been used from 29 February 2016. This was due to signifi cant price movements experienced once trading
commenced in both markets after the Fund’s valuation point on that day. Suspended securities are valued at the last traded price or at the Fund Manager’s best
estimate of fair value based on market information and particular circumstances that led to the suspension subject to agreement from the ACD’s valuation committee.
Market value is defi ned by the SORP as fair value which is generally the bid value.
Open Forward Currency Contracts are shown in the Portfolio Statement and are valued using contracted forward rates. The net gains/(losses) are refl ected in
“Forward currency contracts” in Net capital gains/(losses).
Open Futures Contracts are shown in the Portfolio Statement and are valued using broker prices. The net gains/(losses) are refl ected in “Derivative contracts” in Net
capital gains/(losses).
Open Swap Contracts are shown in the Portfolio Statement and at fair value. The net gains/(losses) are refl ected in “Derivative contracts” in Net capital gains/(losses).
c) Exchange rates
Assets and liabilities held in overseas currencies have been translated into sterling at the exchange rates ruling at noon on 29 February 2016. Transactions during the
year are translated at the rate ruling on the transaction date.
d) Recognition of revenue
Income encompasses both revenue and capital gains/(losses). Revenue generally includes items such as dividends, interest and other similar items that were
previously referred to as ‘income’. Capital is the return from holding investments other than part of the return that is revenue.
All dividends and scrip (stock) dividends on equities are recognised when the securities are quoted ex-dividend net of any attributable tax credits. Bank interest,
interest on investments and other receivables are accrued up to the accounting date.
Accumulation of revenue relating to accumulation units or shares held in collective investment schemes is recognised as revenue and included in the amount
available for distribution. Equalisation received from distributions or accumulations on units or shares in collective investment schemes is treated as capital and
deducted from the cost of the investment.
Revenue from debt securities is accounted for on an effective interest basis.
Underwriting commission is taken to revenue and recognised when the issue takes place, unless the Funds are required to take up all or some of the underwritten
shares. In this case the commission is used to reduce the cost of those shares.
Special dividends are treated as revenue or capital depending on the facts of each particular case.
Stocklending revenue is accounted for on an accruals basis. Fees earned from stock lending are included in revenue on a gross basis.
Where derivatives are used to protect or enhance revenue, any gains or losses are treated as revenue of the Fund. Where derivatives are used to protect or enhance
capital, depending on the motives and circumstances, any gains or losses are treated as capital property of the Funds.
e) Expenses
Expenses are accounted for on an accruals basis.
f) Taxation
Provision is made for corporation tax at current rates on the excess of taxable revenue over allowable expenses. Stamp duty reserve tax (SDRT) suffered on the
surrender and reissue of shares has been charged against the net assets of the Fund through the Statement of Change in Net Assets Attributable to Shareholders.
g) Deferred taxation
Where applicable, a provision is made on all material timing differences between the recognition of revenue in the fi nancial statements and its recognition in the
Funds’ annual tax returns. Deferred tax liabilities are recognised to the extent that it is possible that an actual liability will crystallise and deferred tax assets are
recognised where it is more than likely that an asset is recoverable.
No deferred tax assets have been recognised as there is uncertainty over future net revenues to utilise such assets.
REPORT AND ACCOUNTS
Investec Funds Series iii54
Notes to the Financial Statements of the Company continuedFor the year ended 29 February 2016
2. Distribution policies
a) Basis of distribution
If at the end of the distribution period, revenue exceeds expense borne by revenue for distribution purposes, the net revenue after taxation of that Fund is available to
be distributed to its shareholders. In order to conduct a controlled dividend fl ow to shareholders, interim distributions will be at the ACD’s discretion, up to a
maximum of the distributable revenue available for the period. At the end of the year, all remaining net revenue is distributed.
Emerging Markets Local Currency Debt Fund will distribute revenue on a quarterly basis. Global Bond Fund will distribute revenue on a semi annual basis.
Global Dynamic Fund, Global Equity Fund and Global Gold Fund will distribute annually by reference to net revenue arising during the year ended 2 9 February 201 6.
Any defi cit of revenue after taxation will reduce the capital of the Fund.
Distributions on accumulation shares are retained by the Fund and increase the value of the accumulation shares.
b) Apportionment to multiple share classes
The allocation of revenue and non class specifi c expenses is based upon the proportion of the Funds’ assets attributable to each share class, on the day the revenue
is earned or expense is suffered.
c) Stock dividends
Ordinary scrip dividends are treated as revenue and will form part of any distribution. A transfer is made from capital to revenue to compensate for the amount of
revenue foregone. In the case of enhanced scrip dividends, any enhancement is taken to capital.
d) Interest from debt securities
As noted in note 1d above, revenue from fi xed interest securities is accounted for on an effective interest basis, where applicable, UK interest distributions are also
based on an effective interest basis.
e) Expenses
Management expenses including the General Administration Charge (GAC) and custody are charged against revenue unless otherwise stated in the Prospectus. The
only exception is the Emerging Markets Local Currency Debt Fund, where expenses are borne by capital for distribution.
f) Equalisation
Equalisation takes account of the distributable revenue in the share price that is received on the creation of shares and paid on cancellation of shares and is allocated
to the distribution account to equalise the distribution payable to Shareholders.
g) Aggregate distribution
The aggregate distribution for the company is based on the individual funds’ net revenue after taxation. Where there is a signifi cant difference between net revenue
after taxation and the amounts available for distribution, a reconciliation has been provided.
3. Risk management policies
Any investment in stock market funds involves risk. Some of these risks are general, which means that they apply to all funds. Others are specifi c, which means that
they apply to individual funds only.
We monitor our Funds’ portfolios against certain parameters, seeking to ensure that they meet an acceptable risk: reward profi le.
Risk management process
The stock selection and asset allocation of the portfolios are reviewed at periodic fund review meetings. Consideration is given to whether the risk associated with
the exposure to particular investment categories or stocks is prudent in the context of the investment objective. The Investment Manager has responsibility for
monitoring the existing portfolios in accordance with an overall investment category deviation parameter and seeks to ensure that the portfolios as a whole meet an
acceptable risk: reward profi le. Monthly market risk reviews are conducted on core funds, investigating levels and trends in risk exposures and the overall diversity of
risk contributors. For certain forms of derivative intensive funds, daily predicted Value at Risk levels are also monitored.
Listed below are the specifi c risks applicable to the Funds. Investors should refer to Clause 5, Appendix 1 (for specifi c risks) and Appendix vii of the prospectus for a
detailed explanation of each of the risks highlighted below.
Emerging Markets Local Currency Debt Fund
Active Management
China Risk
Concentration
Emerging Markets
Equity Investment
Exchange Rate
Loss
Market Action
Past Performance
Political
Pricing and Liquidity
Settlement and Custody
Stock Connect
Global Bond Fund
Counterparty
Credit
Emerging Markets
Exchange Rates
Interest Rate
Loss
Market Action
Past Performance
Short Exposure
Yield
REPORT AND ACCOUNTS
Investec Funds Series iii 55
Notes to the Financial Statements of the Company continuedFor the year ended 29 February 2016
3. Risk management policies continued
Global Dynamic Fund
China Risk
Concentration
Emerging Markets
Equity Investment
Exchange Rate
Loss
Market Action
Past Performance
Stock Connect
Global Equity Fund
China Risk
Equity Investment
Exchange Rates
Loss
Market Action
Past Performance
Stock Connect
Global Gold Fund
Concentration
Equity Investment
Exchange Rate
Loss
Market Action
Past Performance
Pricing and Liquidity
Active Management
The Investment Manager either has greater than typical freedom to vary the proportion of the Fund invested in different types of asset, or the Investment Manager
has greater than typical freedom to deviate away from the benchmark, creating a higher than usual risk that the Fund will not participate in a general upward move in
markets and that it may decline even while markets generally are rising.
China Risk
Investments in China are particularly exposed to China’s economic, social and political system, which may behave differently to other markets, and investments in
China may be harder to assess for suitability or risk. China has enjoyed signifi cant economic prosperity in recent years but continued growth cannot be assumed and
a decline in China’s economic performance may affect the Fund’s investment.
Investments in China are subject to State-imposed restrictions, including the operation of trading quotas and currency management; while other State and regulatory
intervention may be more unpredictable or intrusive than in other markets. China’s laws and regulations relating to securities (including surrounding taxation) are new
and evolving, their application is subject to uncertainty, and they may be subject to change in the future. Investments in China may be subject to greater or more
frequent rises and falls in value than other markets and may be harder or impossible to buy or sell.
Accounting and auditing standards in China may also be less rigorous than their international equivalents and this could result in investments being overvalued.
Investments held by Chinese brokers may be mixed with other investors’ assets or subject to lower safekeeping standards than investments held domestically, which
could lead to delays in payment or losses should the broker become insolvent. Chinese investments are denominated in Renminbi and its value may fl uctuate widely
from other international currencies.
Other applicable risks:
Investors should also note the following risk factors, which may be applicable to the Fund, each of which is described in more detail in this Appendix: Accounting,
Emerging Markets, Equity Investment, Exchange Rates, Market Action, Market Closure, Political, Settlement and Custody and Tax.
Concentration
Some Funds invest in a narrow range of investments in particular geographical locations or specialised sectors. This focus may result in higher risk if there are
problems in that sector or country when compared to a Fund that has spread or diversifi ed its investments more broadly.
Counterparty
The risk of loss if a counterparty in a OTC derivative, stock lending or repo transaction fails to perform its fi nancial obligations to a Fund. It arises any time that Funds
are extended, committed, invested or otherwise exposed through actual or implied contractual agreements. The counterparties will be reputable fi nancial institutions
specialised in this type of transaction. Where provided for as a term of the relevant contractual arrangement, collateral may be held by the Fund to reduce its
exposure to counterparty risk.
Credit
Where the value of an investment depends on a party (which could be a company, government or other institution) fulfi lling an obligation to pay, there exists a risk that
that obligation will not be satisfi ed. This risk is greater where the fi nancial strength of the party is weaker. The Net Asset Value of a Fund could be affected by any
actual or feared breach of the party’s obligations, while the income of the Fund would be affected only by an actual failure to pay, which is known as a default.
Emerging Markets
Emerging Markets investments may be more volatile and less liquid than investments in developed markets and the investments of the Funds in such markets may be
considered speculative and subject to signifi cant delays in settlement. In addition, there may be a higher than usual risk of exchange rate, political, economic, social
and religious instability and of adverse changes in government regulations. Some of these markets may not be subject to accounting, auditing and fi nancial reporting
standards and practices comparable to those of more developed countries and the securities markets of such markets may be subject to unexpected closure.
In addition, there may be less government supervision, legal regulation and less well defi ned tax laws and procedures than in countries with more developed
securities markets.
REPORT AND ACCOUNTS
Investec Funds Series iii56
Notes to the Financial Statements of the Company continuedFor the year ended 29 February 2016
3. Risk management policies continued
Equity Investment
The value of equities and equity-related investments may vary according to company profi ts and future prospects as well as more general market factors. In the event
of a company default, the owners of their equity rank last in terms of any fi nancial payment from that company.
Exchange Rate
If a Fund is invested in overseas markets or holds currencies other than sterling, then currency exchange rate movements may cause the value of your investment to
fall as well as rise. Even UK centric Funds may have the ability to invest overseas or in UK companies which invest or carry out a signifi cant proportion of their
business overseas.
Interest Rate
The earnings or market value of a Fund may be affected by changes in interest rates. This risk can be particularly relevant for Funds holding fi xed-rate debt securities
(such as bonds), since their values may fall if interest rates rise. Furthermore, Funds holding fi xed-rate debt securities with a long time until maturity may be more
sensitive to changes in interest rates than shorter-dated debt securities, for example a small rise in long-term interest rates may result in a more than proportionate
fall in the price of a long-dated debt security.
Loss
The value of investments and the income derived from them may fall as well as rise and investors may not recoup the original amount they invest in the Shares of a Fund.
Market Action
Losses may be made due to adverse movements in equity, bond, commodity, currency and other market prices, and to changes in the volatility of any of these. The
key factors driving changes in these market prices are economic growth and infl ation, both of which themselves depend to a greater or lesser extent on offi cial
economic and interest rate policy.
Past Performance
The past performance of a Fund should not be taken as a guide to its future performance. A Fund that has performed well in the past may perform poorly in the
future and a Fund that has performed poorly in the past may perform well in the future.
Political
Expropriation by the state, social or political instability, or other restrictions on the freedom of the fund to deal in its investments, may all lead to investment losses.
Pricing and Liquidity
The risk that the price at which an asset is valued may not be realisable in the event of sale. This could be due to a mis-estimation of the asset’s value or due to a lack
of liquidity in the relevant market.
Settlement and Custody
There may be delays in settlement and/or uncertainty in relation to the ownership of a Fund’s investments which could affect the Fund’s liquidity and which may lead
to investment losses.
Short Exposure
If a Fund uses derivatives to create short exposure, while there is the potential for a gain to be made when the underlying securities are falling in value there is also the
risk of loss when the underlying is rising in value.
Stock Connect
To the extent that the Funds’ investments in China are dealt via Hong Kong Shanghai Stock Connect (“Stock Connect”), such dealing will be subject to additional risk
factors.
Stock Connect is a new trading programme, therefore the relevant rules and regulations are untested and subject to change. Since investments through Stock
Connect are subject to certain restrictions (including trading day restrictions, pre-trade checking, eligibility of stock, quota limits and daily trade quotas), investments
may be subject to greater or more frequent rises and falls in value and may be harder to buy or sell.
Under Stock Connect, overseas investors such as the investing Funds may invest directly in certain China A shares listed on the Shanghai Stock Exchange (“SSE
shares”). The Funds trade SSE Shares through a broker who is affi liated to the Hong Kong sub-custodian appointed by the Depositary.
SSE Shares purchased through Stock Connect are uncertifi ed and held in accounts in the Hong Kong Central Clearing and Settlement System maintained by the
Hong Kong Securities and Clearing Corporation Limited (“HKSCC”), the central securities depositary in Hong Kong. HKSCC in turn holds the legal title to the SSE
Shares of all its participants through a nominee omnibus securities account in its name, registered with ChinaClear, the central securities depositary in China.
A failure or delay by the HKSCC in the performance of its obligations may result in a failure of settlement, or the loss, of SSE shares and/or monies in connection with
them and the Funds may suffer losses as a result.
Foreign investors like the Funds investing through the Stock Connect remain benefi cial owners of the SSE Shares and are only eligible to exercise their rights to the
SSE Shares in China through the HKSCC nominee.
In the event of a default of ChinaClear, HKSCC through its nominee is likely to seek to recover any outstanding SSE Shares on behalf of the Funds from ChinaClear
through available legal channels but it is not obligated to do so. If HKSCC does not enforce claims against ChinaClear the Fund may not be able to recover all of its
SSE Shares.
Trading under Stock Connect will not be covered by Hong Kong’s Investor Compensation Fund nor the China Securities Investor Protection Fund.
Investors should also consider the China Risk detailed in this note which applies to investment in China.
Yield
The level of any yield for a Fund may be subject to fl uctuations and is not guaranteed.
Investec Funds Series iii 57
REPORT AND ACCOUNTS
Notes to the Financial Statements of the Company continuedFor the year ended 29 February 2016
3. Risk management policies continued
Sensitivity analysis
The table below shows the fund’s beta; this is a historical measure of the funds’ sensitivity to movements in well known markets. A beta of 1.0 would suggest that a
fund had experienced a close relationship to the volatility of the market index against which it was being measured, rising when the market rises and falling when it
falls in a one to one manner. A beta of 1.5 would suggest that a fund had experienced movements of 1.5 times the index i.e. the fund was more volatile than the
market. A beta of 0.5 would suggest that a fund had experienced movements in values of half of the index’s movement i.e. the fund was less volatile than the market.
Broadly speaking, if a fund has a beta of ‘B’ to an index, it means that if the index value changes by ‘X’% we could expect the fund value to change by ‘B’ multiplied
by ‘X’%. Of course, this is only an expectation, but it is a good indicator of the risk currently faced by particular funds.
Citigroup World
FTSE MSCI Government Bond
2016† All-Share Index World Index Index
Emerging Markets Local Currecny Debt Fund n/a n/a 0.35
Global Bond Fund n/a n/a 0.65
Global Dynamic Fund 0.53 0.54 n/a
Global Equity Fund 0.52 0.54 n/a
Global Gold Fund† 0.21 0.06 n/a
† Source: Lipper 01.03.13 – 29.02.16 using daily sub-periods for class ‘A’ income shares for Global Bond Fund and class ‘A’ accumulation shares for all other Funds.
Citigroup World
FTSE MSCI Government Bond
2015†† All-Share Index World Index Index
Emerging Markets Local
Currency Debt Fund n/a n/a 0.29
Global Bond Fund n/a n/a 0.61
Global Dynamic Fund 0.40 0.46 n/a
Global Equity Fund 0.39 0.45 n/a
Global Gold Fund 0.41 0.22 n/a
†† Source: Lipper 01.03.12 – 28.02.15 using daily sub-periods for class ‘A’ income shares for Global Bond Fund and class ‘A’ accumulation shares for all other Funds.
Past performance is not a guide to future performance.
4. Dilution adjustment
A dilution adjustment may be applied at the ACD’s discretion to all purchases, sales and switches of shares where the impact of the net deals is believed to have a
material effect.
A dilution adjustment or levy is a method to ensure fair treatment between investors joining, leaving or remaining in a Fund. We reserve the right to levy a dilution
adjustment on any or all deals. The price of the shares of a Fund may be adjusted to protect its value from being reduced in the case of larger scale movements into
or out of the Fund.
Full details on the ACD policy for dilution adjustment can be found in the Prospectus.
We hereby certify the Annual Report and Accounts on behalf of the Directors of Investec Fund Managers Limited
K. McFarland
Director of the ACD
24 February 2016
D. Aird
Director of the ACD
REPORT AND ACCOUNTS
Investec Funds Series iii58
Statement of Total ReturnFor the year ended 29 February 2016
29.02.16 28.02.15
Note £’000 £’000 £’000 £’000
Income
Net capital losses 4 (151,862) (57,700)
Revenue 6 61,202 91,215
Expenses 7 (8,179) (11,545)
Interest payable and similar charges 9 (99) (78)
Net revenue before taxation 52,924 79,592
Taxation 8 (419) (1,720)
Net revenue after taxation 52,505 77,872
Total return before distributions (99,357) 20,172
Distribution 9 (54,268) (89,244)
Change in net assets attributable to
shareholders from investment activities (153,625) (69,072)
Statement of Change in Net Assets Attributable to ShareholdersFor the year ended 29 February 2016
29.02.16 28.02.15
£’000 £’000 £’000 £’000
Opening net assets attributable to shareholders 1,307,483 1,154,879
Amounts receivable on creation of shares 61,872 500,658
Amounts payable on cancellation of shares (728,289) (357,457)
(666,417) 143,201
Dilution adjustment 200 301
Change in net assets attributable to
shareholders from investment activities (153,625) (69,072)
Retained distribution on accumulation shares 42,310 78,174
Closing net assets attributable to shareholders 529,951 1,307,483
Notes to the fi nancial statements are on pages 59 to 66.
Balance SheetAs at 29 February 2016
29.02.16 28.02.15
Note £’000 £’000 £’000 £’000
ASSETS
Investment assets 520,941 1,307,651
Current assets
Debtors 10 9,280 48,481
Cash and bank balances 11 30,491 35,264
Total other assets 39,771 83,745
Total assets 560,712 1,391,396
LIABILITIES
Investment liabilities 25,543 57,740
Creditors
Bank overdrafts 2,447 3,029
Distribution payable 1,882 3,619
Other creditors 12 889 19,525
Total other liabilities 5,218 26,173
Total liabilities 30,761 83,913
Net assets attributable to shareholders 529,951 1,307,483
Notes to the fi nancial statements are on pages 59 to 66.
Emerging Markets Local Currency Debt Fund
REPORT AND ACCOUNTS
59Investec Funds Series iii
1. Accounting policies
The Accounting policies for the Fund are disclosed in the notes to the fi nancial statements on page 53.
2. Distribution policies
The Distribution policies for the Fund are disclosed in the notes to the fi nancial statements on page 54.
3. Risk management policies
The Risk management policies for the Fund are disclosed in the notes to the fi nancial statements on page 54-57.
4. Net capital losses
The net capital losses during the year comprise:
29.02.16 28.02.15
£’000 £’000
Non-derivative securities (119,073) (80,184)
Derivative contracts (16,068) (155)
Forward currency contracts 7,275 18,514
(Losses)/gains on foreign exchange (23,980) 4,148
Transaction charges (16) (23)
Net capital losses (151,862) (57,700)
5. Purchases, sales and transaction costs
There were no transactions costs incurred during the year to 29 February 2016.
Purchases Sales
29.02.16 28.02.15 29.02.16 28.02.15
£’000 £’000 £’000 £’000
Bonds 442,816 1,269,363 1,034,476 1,025,236
Collective Investment Schemes 10,089 12,138 29,611 14,788
Futures* – – – –
Swaps 1,537,153 313,610 1,569,909 312,776
Treasury Bills 8,326 23,107 5,186 51,768
Cash Collateral 18,440 7,470 19,380 5,550
Trades excluding transaction costs 2,016,824 1,625,688 2,658,562 1,410,118
Commissions
Bonds – – – –
Collective Investment Schemes – – – –
Futures* – – – –
Swaps – – – –
Treasury Bills – – – –
Cash Collateral – – – –
Taxes
Bonds – – – –
Collective Investment Schemes – – – –
Futures* – – – –
Swaps – – – –
Treasury Bills – – – –
Cash Collateral – – – –
Total costs – – – –
Net trades in the year after transaction costs 2,016,824 1,625,688 2,658,562 1,410,118
* Purchases and/or sales of future contracts do not incur transaction costs and have been included at the value of their exposure.
Notes to the Financial StatementsFor the year ended 29 February 2016
REPORT AND ACCOUNTS
60 Investec Funds Series iii
Total transaction cost expressed as a percentage of asset type cost.
Purchases Sales
29.02.16 28.02.15 29.02.16 28.02.15
% % % %
Commissions
Bonds – – – –
Collective Investment Schemes – – – –
Futures* – – – –
Swaps – – – –
Treasury Bills – – – –
Cash Collateral – – – –
tba 5 – – – –
Taxes
Bonds – – – –
Collective Investment Schemes – – – –
Futures* – – – –
Options – – – –
Swaps – – – –
Treasury Bills – – – –
Cash Collateral – – – –
Total transaction cost expressed as a percentage of average net asset value.
29.02.16 28.02.15
% %
Commissions – –
Taxes – –
Total costs – –
Average portfolio dealing spread
The average portfolio dealing spread at the balance sheet was 0.42% (28.02.15: 0.45%).
6. Revenue
29.02.16 28.02.15
£’000 £’000
Interest on debt securities 55,003 81,838
Interest on total return swaps 4,024 6,671
Offshore distribution taxable from collective investment schemes 1,860 2,385
Bank interest 94 95
Margin interest 206 188
Stocklending income 14 38
Trial Commission 1 –
Total revenue 61,202 91,215
7. Expenses
29.02.16 28.02.15
£’000 £’000
Payable to the ACD or associates of the ACD, and agents of either of them:
ACD fee 6,651 9,316
General administration charge (GAC) 755 1,148
7,406 10,464
Payable to the Depositary or associates of the Depositary, and agents of either of them:
Safe custody fee 733 1,070
733 1,070
Other expenses:
Stock lending fee 2 5
VAT refund (22) (17)
DTC fees – 23
FPI fees 2 –
Out of pocket expenses 58 –
40 11
Total expenses 8,179 11,545
Please refer to the Prospectus for a full description of expenses covered by the GAC.
The audit fee for the year is £11,000 (28.02.15: £11,000).
VAT is currently recovered in respect of certain expenses paid under the GAC.
Notes to the Financial Statements continuedFor the year ended 29 February 2016
REPORT AND ACCOUNTS
61Investec Funds Series iii
8. Taxation
a) Analysis of the tax charge in the year:
29.02.16 28.02.15
£’000 £’000
Irrecoverable income tax 419 1,731
Adjustments in respect of prior years – (11)
Current tax charge (note 8(b)) 419 1,720
Deferred tax charge (note 8(c)) – –
Total tax charge 419 1,720
b) Factors affecting current tax charge for the year:
The tax assessed for the year is lower than the standard rate of corporation tax in the UK for an authorised OEIC (20%) (28.02.15: 20%). The differences are explained
below:
29.02.16 28.02.15
£’000 £’000
Net revenue before taxation 52,924 79,592
Corporation tax of 20% 10,585 15,918
Effects of:
Revenue not subject to taxation – (19)
Overseas tax expensed – (346)
Tax deductible interest distributions (10,585) (15,553)
Income tax prior year adjustment – (11)
Irrecoverable income tax 419 1,731
Current tax charge (note 8(a)) 419 1,720
c) Provision for deferred taxation:
There is no provision required for deferred taxation at the Balance Sheet date in the current or prior year.
9. Finance costs
Distributions and interest
The Distributions take account of equalisation received on the creation of shares and deducted on the cancellation of shares, and comprises:
29.02.16 28.02.15
£’000 £’000
First quarter 16,393 21,922
Second quarter 11,946 22,638
Third quarter 10,849 23,189
Final 8,554 19,963
Income tax deducted at source 2,079 3,548
49,821 91,260
Add: Equalisation deducted on cancellation of shares 4,812 2,298
Less: Equalisation received on creation of shares (365) (4,314)
Finance costs: Distribution 54,268 89,244
Finance cost: Interest 82 66
Finance cost: Margin interest 17 12
99 78
Total fi nance costs 54,367 89,322
The net distribution for the year is represented by:
29.02.16 28.02.15
£’000 £’000
Net revenue after taxation 52,505 77,872
Amounts charged to capital:
ACD fee 1,611 9,316
General administration charge 170 1,148
Safe custody fee 150 1,070
Equalisation on conversion shares (168) (162)
Finance costs: Distribution 54,268 89,244
REPORT AND ACCOUNTS
62 Investec Funds Series iii
10. Debtors
29.02.16 28.02.15
£’000 £’000
Amounts receivable for creation of shares 77 146
Sales awaiting settlement 232 23,568
Accrued bond interest 8,570 23,823
Accrued total return swaps 401 908
Dilution adjustment – 36
9,280 48,481
11. Cash and bank balances
29.02.16 28.02.15
£’000 £’000
Cash and bank balances 22,610 25,409
Amounts held at futures clearing houses and brokers 7,881 9,855
30,491 35,264
12. Creditors
29.02.16 28.02.15
£’000 £’000
Amounts payable for cancellation of shares 385 970
Purchases awaiting settlement – 17,588
Accrued ACD fee 307 674
Accrued general administration charge 35 83
Accrued safe custody fee 157 207
Accrued transaction charges 5 3
889 19,525
13. Capital commitments and contingent liabilities
The Fund had no contingent liabilities or capital commitments at the year end date. (28.02.15: Nil).
14. Related party transactions
Investec Fund Managers Limited, as Authorised Corporate Director (ACD), is a related party, and acts as a principal in respect of all transactions of shares in the
Company. The aggregate monies received through issues and paid on cancellation of shares are disclosed in the Statement of Change in Shareholders’ Net Assets.
In accordance with the prospectus the ACD collects from the Fund, a general administration charge (GAC), ACD fees and safe custody fees. Please refer to notes 7,
12 and 16 for further details.
Any amounts due to/from Investec Fund Managers Limited at the end of the accounting year are disclosed in notes 10 and 12.
At the year end date nil% of the Fund’s shares (by net asset value) were held by other Funds managed by the ACD (28.02.15: 1.97%).
15. Dilution adjustment
Please refer to note 4 of the notes to the fi nancial statements of the company for a detailed description of dilution adjustment.
16. ACD fees and charges
The different level of ACD fees payable per annum as at 29 February 2016 for each share class is detailed below:
A Shares 1.50%
I Shares 0.75%
R Shares 1.00%
S Shares 0.00%
The GAC is charged at 0.08% of the Net Asset Value of each share class.
All shares within the sub-fund have the same rights on winding up.
Notes to the Financial Statements continuedFor the year ended 29 February 2016
REPORT AND ACCOUNTS
63Investec Funds Series iii
Reconciliation of the shares movement in the year
28.02.15 29.02.16
Opening Closing
shares in Shares shares in
issue Creations Cancellations converted issue
‘A’ Net Class (Accumulation shares) 23,174,507 219,947 (8,677,682) (5,058,413) 9,658,359
‘A’ Gross Class (Accumulation shares) 63,308,707 5,282,498 (44,666,625) (70,794) 23,853,786
‘A’ Gross Class (USD Accumulation shares) 3,840,195 – (2,897,396) – 942,799
‘A’ Net Class (Income-2 shares) 28,023,04 1 92,021 (14,969,642) (3,158,484) 9,986,936
‘A’ Gross Class (Income-2 shares) 4,750,164 104,533 (1,583,809) (198,290) 3,072,598
‘I’ Net Class (Accumulation shares) 49,408,678 3,622,764 (23,980,741) 15,052,078 44,102,779
‘I’ Gross Class (Accumulation shares) 39,555,100 7,512,680 (83,676,623) 94,902,504 58,293,661
‘I’ Gross Class (USD Accumulation shares) 277,083,603 10,784,34 3 (197,411,725) – 90,456,221
‘I’ Net Class (Income-2 shares) 156,744,599 16,346,724 (92,776,258) 3,934,774 84,249,839
‘I’ Gross Class (Income-2 shares) 6,250 119,764 (18,538) 135,271 242,747
‘R’ Net Class (Accumulation shares) 75,696 217 (13,809) – 62,104
‘R’ Net Class (Income-2 shares) 6,250 405 – – 6,655
‘S’ Gross Class (Accumulation shares) 211,113,316 3,435,609 (45,238,804) (103,651,942) 65,658,179
17. Risk considerations
Please refer to note 3 of the notes to the fi nancial statements of the company for a detailed description of the risk considerations. There are no further specifi c risks
for this Fund.
The Fund’s currency exposure as at 29 February 2016 was:
Currency exposure
Total Total
29.02.16 28.02.15
Currency £’000 £’000
Argentine Peso 1 –
Brazilian Real 36,231 127,098
Chilean Peso 516 33,490
Chinese Yuan (3,860) –
Chinese Yuan (Offshore) (28,435) 74,094
Colombian Peso 30,792 56,142
Czech Koruna (151) 465
Egyptian Pound 2,752 27,249
Euro 4,541 (12,864)
Ghanaian Cedi (862) –
Hungarian Forint 27,853 68,498
Indian Rupee (20) 23,464
Indonesian Rupiah 67,513 167,921
Israeli Shekel (24,027) (49,441)
Kenyan Shilling (325) (16,005)
Malaysian Ringgit 38,558 135,032
Mexican Peso 62,210 176,552
Nigerian Naira 3,495 (13,241)
Peruvian Nuevo Sol (3,253) (36,636)
Philippine Peso 3,043 52,862
Polish Zloty 54,700 128,329
Romanian Leu 16,887 32,239
Russian Ruble 22,473 58,698
Serbian Dinar (5) 6,644
Singapore Dollar (246) (58,808)
South African Rand 47,010 130,595
South Korean Won (36) (30,219)
Sterling 5,484 (1,863)
Taiwan Dollar (29,354) (73,172)
Thai Baht 49,868 42,524
Turkish Lira 52,725 149,935
Uganda Shilling 6,579 13,290
Ukraine Hryvnia – 6,733
Uruguayan Peso – 3,700
US Dollar 87,394 84,178
Zambian Kwacha (100) –
Total 529,951 1,307,483
REPORT AND ACCOUNTS
64 Investec Funds Series iii
Interest rate risk profi le of fi nancial assets and liabilities as at 29 February 2016 was as follows:
Financial
Floating rate Fixed rate assets not
fi nancial fi nancial carrying
assets assets interest Total
29.02.16 29.02.16 29.02.16 29.02.16
Currency £’000 £’000 £’000 £’000
Argentine Peso – – 1 1
Brazilian Real – 65,696 1,108 66,804
Chilean Peso – 2,155 41 2,196
Colombian Peso 13 30,311 1,440 31,764
Egyptian Pound – – 2,752 2,752
Euro – – 6,888 6,888
Hungarian Forint – 27,490 854 28,344
Indian Rupee – – 1 1
Indonesian Rupiah – 22,017 45,502 67,519
Malaysian Ringgit – 25,710 12,848 38,558
Mexican Peso 57 44,045 18,108 62,210
Nigerian Naira – – 3,495 3,495
Peruvian Nuevo Sol – 8,794 84 8,878
Philippine Peso – 751 2,293 3,044
Polish Zloty 1 31,125 23,574 54,700
Romanian Leu 157 8,727 8,003 16,887
Russian Ruble 181 57,497 978 58,656
Serbian Dinar – – 1 1
South African Rand 4,483 19,247 23,291 47,021
South Korean Won 3,399 – 126 3,525
Sterling 179 – 8,076 8,255
Thai Baht 9 27,567 22,292 49,868
Turkish Lira 198 50,019 2,508 52,725
Uganda Shilling 5 – 6,574 6,579
US Dollar 21,807 12,141 53,548 87,496
Total 30,489 433,292 244,386 708,167
Financials
Floating rate liabilities not
fi nancial carrying
liabilities interest Total
29.02.16 29.02.16 29.02.16
Currency £’000 £’000 £’000
Brazilian Real – 30,573 30,573
Chilean Peso – 1,680 1,680
Chinese Yuan – 3,860 3,860
Chinese Yuan (Offshore) – 28,435 28,435
Colombian Peso – 972 972
Czech Koruna – 151 151
Euro 2,347 – 2,347
Ghanaian Cedi – 862 862
Hungarian Forint – 491 491
Indian Rupee – 21 21
Indonesian Rupiah – 6 6
Israeli Shekel – 24,027 24,027
Kenyan Shilling – 325 325
Peruvian Nuevo Sol – 12,131 12,131
Philippine Peso – 1 1
Russian Ruble – 36,183 36,183
Serbian Dinar – 6 6
Singapore Dollar – 246 246
South African Rand – 11 11
South Korean Won – 3,561 3,561
Sterling – 2,771 2,771
Taiwan Dollar – 29,354 29,354
US Dollar 100 2 102
Zambian Kwacha – 100 100
Total 2,447 175,769 178,216
Notes to the Financial Statements continuedFor the year ended 29 February 2016
REPORT AND ACCOUNTS
65Investec Funds Series iii
Interest rate risk profi le of fi nancial assets and liabilities as at 28 February 2015 was as follows:
Financial
Floating rate Fixed rate assets not
fi nancial fi nancial carrying
assets assets interest Total
28.02.15 28.02.15 28.02.15 28.02.15
Currency £’000 £’000 £’000 £’000
Brazilian Real – 148,272 2,567 150,839
Chilean Peso – 2,239 31,251 33,490
Chinese Yuan (Offshore) – – 74,094 74,094
Colombian Peso 6 94,087 3,858 97,951
Czech Koruna 90 – 1,437 1,527
Egyptian Pound – – 27,249 27,249
Hungarian Forint 251 72,384 21,233 93,868
Indian Rupee – – 23,464 23,464
Indonesian Rupiah – 59,004 108,920 167,924
Israeli Shekel 845 – – 845
Malaysian Ringgit – 145,003 1,559 146,562
Mexican Peso – 100,403 76,149 176,552
Nigerian Naira – 19,815 545 20,360
Peruvian Nuevo Sol 2 28,271 144 28,417
Philippine Peso – 787 52,076 52,863
Polish Zloty – 105,163 24,105 129,268
Romanian Leu – 38,655 1,575 40,230
Russian Ruble 78 64,921 1,194 66,193
Serbian Dinar 1,240 6,362 229 7,831
Singapore Dollar – 41,905 514 42,419
South African Rand 6,222 61,813 65,993 134,028
South Korean Won 1,578 – – 1,578
Sterling 3,406 – 182 3,588
Thai Baht – 54,325 381 54,706
Turkish Lira 3 98,129 55,046 153,178
Uganda Shilling – – 13,290 13,290
Ukraine Hryvnia – – 6,733 6,733
Uruguayan Peso – – 3,700 3,700
US Dollar 24,944 – 59,341 84,285
Total 38,665 1,141,538 656,829 1,837,032
Financials
Floating rate liabilities not
fi nancial carrying
liabilities interest Total
28.02.15 28.02.15 28.02.15
Currency £’000 £’000 £’000
Brazilian Real – 23,741 23,741
Colombian Peso – 41,809 41,809
Czech Koruna – 1,062 1,062
Euro 2,161 10,703 12,864
Hungarian Forint – 25,370 25,370
Indonesian Rupiah – 3 3
Israeli Shekel – 50,286 50,286
Kenyan Shilling – 16,005 16,005
Malaysian Ringgit – 11,530 11,530
Nigerian Naira – 33,601 33,601
Peruvian Nuevo Sol – 65,053 65,053
Philippine Peso – 1 1
Polish Zloty – 939 939
Romanian Leu 868 7,123 7,991
Russian Ruble – 7,495 7,495
Serbian Dinar – 1,187 1,187
Singapore Dollar – 101,227 101,227
South African Rand – 3,433 3,433
South Korean Won – 31,797 31,797
Sterling – 5,451 5,451
Taiwan Dollar – 73,172 73,172
Thai Baht – 12,182 12,182
Turkish Lira – 3,243 3,243
US Dollar – 107 107
Total 3,029 526,520 529,549
REPORT AND ACCOUNTS
66 Investec Funds Series iii
18. Effi cient portfolio management techniques risk exposure
The exposure obtained through effi cient portfolio management techniques and identity of counterparties as at 29 February 2016 was as follows:
a) Stock lending
The aggregate value of securities on loan at 29 February 2016 is £nil (28.02.15: £28,911,000). The identities of these counterparties are listed in the counterparties
table below. Securities on loan are included in the portfolio statement and no account is taken of any collateral held. The aggregate value of collateral held at
29 February 2016 is £nil (28.02.15: £29,950,000). This collateral is listed in the collateral held table below.
The gross earnings and fees paid for the year are £nil (28.02.15: £nil) and £nil (28.02.15: £nil).
29.02.16 28.02.15
Value of stock on loan by counterparty £’000 £’000
Goldman Sachs – 12,238
JPMorgan – 16,673
Total – 28,911
29.02.16 28.02.15
Collateral held £’000 £’000
Cash – 29,950
b) Swap
Value of Value of
collateral collateral
29.02.16 28.02.15
Counterparty £’000 £’000
Citibank 2,460 3,400
Total 2,460 3,400
c) Forwards
Market value Market value
29.02.16 28.02.15
Counterparty £’000 £’000
Barclays Bank 3,650 77
Citibank 932 (3,898)
Deutsche Bank 1,706 (480)
Goldman Sachs 2,030 4,056
HSBC (216) (87)
JPMorgan (1,583) 740
Standard Chartered Bank (831) (5,136)
State Street Bank (359) –
UBS (478) –
Total 4,851 (4,728)
d) Futures
Value of
Market value exposure
29.02.16 29.02.16
Counterparty £’000 £’000
Goldman Sachs 732 125,052
Total 732 125,052
Futures
Value of
Market value exposure
28.02.15 28.02.15
Counterparty £’000 £’000
Goldman Sachs (3,845) 190,876
Total (3,845) 190,876
19. Fair value
29.02.16 28.02.15
Assets Liabilities Assets Liabilities
Valuation technique £000 £000 £000 £000
Quoted prices for identical instruments in an active market 732 – 105 (3,950)
Prices of recent transactions for identical instruments 23,263 – 42,447 –
Valuation techniques using observable market data 496,946 (25,543) 1,265,099 (53,790)
Total fair value 520,941 (25,543) 1,307,651 (57,740)
Notes to the Financial Statements continuedFor the year ended 29 February 2016
REPORT AND ACCOUNTS
67Investec Funds Series iii
Emerging Markets Local Currency Debt Fund
Distribution TableFor the year ended 29 February 2016
Interim distribution paid 31 July 2015
Group 1 – shares purchased before 1 March 2015
Group 2 – shares purchased between 1 March 2015 and 31 May 2015
Distribution Distribution
Gross Income Net paid paid
Income Tax @20% Income Equalisation 31-Jul-15 31-Jul-14
pence pence pence pence pence pence
Share Class A Net – Accumulation
Group 1 2.0549 0.4110 1.6439 – 1.6439 2.0772
Group 2 0.9448 0.1890 0.7558 0.8881 1.6439 2.0772
Share Class A Gross – Accumulation
Group 1 2.2701 – 2.2701 – 2.2701 2.8258
Group 2 0.8592 – 0.8592 1.4109 2.2701 2.8258
Share Class A Net – Income-2
Group 1 1.5618 0.3124 1.2494 – 1.2494 1.3822
Group 2 0.6455 0.1291 0.5164 0.7330 1.2494 1.3822
Share Class A Gross – Income-2
Group 1 1.5883 – 1.5883 – 1.5883 1.7418
Group 2 0.8171 – 0.8171 0.7712 1.5883 1.7418
Share Class I Net – Accumulation
Group 1 1.2854 0.2571 1.0283 – 1.0283 1.1741
Group 2 0.6170 0.1234 0.4936 0.5347 1.0283 1.1741
Share Class I Gross – Accumulation
Group 1 2.5979 – 2.5979 – 2.5979 2.9416
Group 2 0.9076 – 0.9076 1.6903 2.5979 2.9416
Share Class I Net – Income-2
Group 1 1.2935 0.2587 1.0348 – 1.0348 1.1264
Group 2 0.7001 0.1400 0.5601 0.4747 1.0348 1.1264
Share Class I Gross – Income-2
Group 1 1.4743 – 1.4743 – 1.4743 n/a
Group 2 0.3863 – 0.3863 1.0880 1.4743 n/a
Share Class R Net – Accumulation
Group 1 1.1648 0.2330 0.9318 – 0.9318 1.1007
Group 2 0.3021 0.0604 0.2417 0.6901 0.9318 1.1007
Share Class R Net – Income-2
Group 1 1.1718 0.2344 0.9374 – 0.9374 1.0315
Group 2 0.1864 0.0373 0.1491 0.7883 0.9374 1.0315
Share Class S Gross – Accumulation
Group 1 2.6575 – 2.6575 – 2.6575 2.7427
Group 2 1.3467 – 1.3467 1.3108 2.6575 2.7427
Distribution Distribution
Gross Income Net paid paid
Income Tax @20% Income Equalisation 31-Jul-15 31-Jul-14
US cent US cent US cent US cent US cent US cent
Share Class A USD Gross – Accumulation
Group 1 3.4701 – 3.4701 – 3.4701 4.7351
Group 2 3.4701 – 3.4701 – 3.4701 4.7351
Share Class I USD Gross – Accumulation
Group 1 3.9630 – 3.9630 – 3.9630 4.8979
Group 2 2.5727 – 2.5727 1.3903 3.9630 4.8979
REPORT AND ACCOUNTS
68 Investec Funds Series iii
Distribution Table continuedFor the year ended 29 February 2016
Interim distribution paid 31 October 2015
Group 1 – shares purchased before 1 June 2015
Group 2 – shares purchased between 1 June 2015 and 31 August 2015
Distribution Distribution
Gross Income Net paid paid
Income Tax @20% Income Equalisation 31-Oct-15 31-Oct-14
pence pence pence pence pence pence
Share Class A Net – Accumulation
Group 1 1.5438 0.3088 1.2350 – 1.2350 2.0563
Group 2 0.9778 0.1956 0.7822 0.4528 1.2350 2.0563
Share Class A Gross – Accumulation
Group 1 1.7033 – 1.7033 – 1.7033 2.7952
Group 2 0.8984 – 0.8984 0.8049 1.7033 2.7952
Share Class A Net – Income-2
Group 1 1.3496 0.2699 1.0797 – 1.0797 1.3606
Group 2 0.7819 0.1564 0.6255 0.4542 1.0797 1.3606
Share Class A Gross – Income-2
Group 1 1.3563 – 1.3563 – 1.3563 1.6972
Group 2 0.5483 – 0.5483 0.8080 1.3563 1.6972
Share Class I Net – Accumulation
Group 1 1.0389 0.2078 0.8311 – 0.8311 1.1603
Group 2 0.5041 0.1008 0.4033 0.4278 0.8311 1.1603
Share Class I Gross – Accumulation
Group 1 2.1201 – 2.1201 – 2.1201 2.9075
Group 2 1.1618 – 1.1618 0.9583 2.1201 2.9075
Share Class I Net – Income-2
Group 1 1.1091 0.2218 0.8873 – 0.8873 1.1062
Group 2 0.7111 0.1422 0.5689 0.3184 0.8873 1.1062
Share Class I Gross – Income-2
Group 1 1.2624 – 1.2624 – 1.2624 n/a
Group 2 0.7685 – 0.7685 0.4939 1.2624 n/a
Share Class R Net – Accumulation
Group 1 0.9250 0.1850 0.7400 – 0.7400 1.0861
Group 2 0.2838 0.0568 0.2270 0.5130 0.7400 1.0861
Share Class R Net – Income-2
Group 1 1.0368 0.2074 0.8294 – 0.8294 1.9549
Group 2 0.3249 0.0650 0.2599 0.5695 0.8294 1.9549
Share Class S Gross – Accumulation
Group 1 2.2872 – 2.2872 – 2.2872 2.7257
Group 2 0.7345 – 0.7345 1.5527 2.2872 2.7257
Distribution Distribution
Gross Income Net paid paid
Income Tax @20% Income Equalisation 31-Oct-15 31-Oct-14
US cent US cent US cent US cent US cent US cent
Share Class A USD Gross – Accumulation
Group 1 2.6235 – 2.6235 – 2.6235 4.6414
Group 2 2.6235 – 2.6235 – 2.6235 4.6414
Share Class I USD Gross – Accumulation
Group 1 3.2427 – 3.2427 – 3.2427 4.8282
Group 2 2.9951 – 2.9951 0.2476 3.2427 4.8282
Emerging Markets Local Currency Debt Fund continued
REPORT AND ACCOUNTS
69Investec Funds Series iii
Distribution Table continuedFor the year ended 29 February 2016
Interim distribution paid 31 January 2016
Group 1 – shares purchased before 1 September 2015
Group 2 – shares purchased between 1 September 2015 and 30 November 2015
Distribution Distribution
Gross Income Net paid paid
Income Tax @20% Income Equalisation 31-Jan-16 31-Jan-15
pence pence pence pence pence pence
Share Class A Net – Accumulation
Group 1 1.7001 0.3400 1.3601 – 1.3601 2.1253
Group 2 0.9591 0.1918 0.7673 0.5928 1.3601 2.1253
Share Class A Gross – Accumulation
Group 1 1.8821 – 1.8821 – 1.8821 2.8953
Group 2 1.0845 – 1.0845 0.7976 1.8821 2.8953
Share Class A Net – Income-2
Group 1 1.4030 0.2806 1.1224 – 1.1224 1.3709
Group 2 0.6604 0.1321 0.5283 0.5941 1.1224 1.3709
Share Class A Gross – Income-2
Group 1 1.4129 – 1.4129 – 1.4129 1.7324
Group 2 1.0002 – 1.0002 0.4127 1.4129 1.7324
Share Class I Net – Accumulation
Group 1 1.1190 0.2238 0.8952 – 0.8952 1.2043
Group 2 0.7150 0.1430 0.5720 0.3232 0.8952 1.2043
Share Class I Gross – Accumulation
Group 1 2.2772 – 2.2772 – 2.2772 3.0052
Group 2 1.7285 – 1.7285 0.5487 2.2772 3.0052
Share Class I Net – Income-2
Group 1 1.1565 0.2313 0.9252 – 0.9252 1.1221
Group 2 0.6843 0.1369 0.5474 0.3778 0.9252 1.1221
Share Class I Gross – Income-2
Group 1 1.3208 – 1.3208 – 1.3208 n/a
Group 2 0.7315 – 0.7315 0.5893 1.3208 n/a
Share Class R Net – Accumulation
Group 1 1.0035 0.2007 0.8028 – 0.8028 1.1259
Group 2 0.3431 0.0686 0.2745 0.5283 0.8028 1.1259
Share Class R Net – Income-2
Group 1 1.0519 0.2104 0.8415 – 0.8415 0.8033
Group 2 0.3548 0.0710 0.2838 0.5577 0.8415 0.8033
Share Class S Gross – Accumulation
Group 1 2.4395 – 2.4395 – 2.4395 2.8371
Group 2 1.3948 – 1.3948 1.0447 2.4395 2.8371
Distribution Distribution
Gross Income Net paid paid
Income Tax @20% Income Equalisation 31-Jan-16 31-Jan-15
US cent US cent US cent US cent US cent US cent
Share Class A USD Gross – Accumulation
Group 1 2.8237 – 2.8237 – 2.8237 4.5591
Group 2 2.8237 – 2.8237 – 2.8237 4.5591
Share Class I USD Gross – Accumulation
Group 1 3.4154 – 3.4154 – 3.4154 4.7465
Group 2 3.4154 – 3.4154 – 3.4154 4.7465
REPORT AND ACCOUNTS
70 Investec Funds Series iii
Distribution Table continuedFor the year ended 29 February 2016
Final distribution payable 30 April 2016
Group 1 – shares purchased before 1 December 2015
Group 2 – shares purchased between 1 December 2015 and 29 February 2016
Distribution Distribution
Gross Income Net payable paid
Income Tax @20% Income Equalisation 30-Apr-16 30-Apr-15
pence pence pence pence pence pence
Share Class A Net – Accumulation
Group 1 2.1789 0.4358 1.7431 – 1.7431 2.0364
Group 2 1.1076 0.2215 0.8861 0.8570 1.7431 2.0364
Share Class A Gross – Accumulation
Group 1 2.4012 – 2.4012 – 2.4012 2.7769
Group 2 0.9921 – 0.9921 1.4091 2.4012 2.7769
Share Class A Net – Income-2
Group 1 1.6779 0.3356 1.3423 – 1.3423 1.3034
Group 2 0.6081 0.1216 0.4865 0.8558 1.3423 1.3034
Share Class A Gross – Income-2
Group 1 1.6860 – 1.6860 – 1.6860 1.6328
Group 2 1.0536 – 1.0536 0.6324 1.6860 1.6328
Share Class I Net – Accumulation
Group 1 1.3950 0.2790 1.1160 – 1.1160 1.1543
Group 2 0.7568 0.1514 0.6054 0.5106 1.1160 1.1543
Share Class I Gross – Accumulation
Group 1 2.8345 – 2.8345 – 2.8345 2.8990
Group 2 1.3307 – 1.3307 1.5038 2.8345 2.8990
Share Class I Net – Income-2
Group 1 1.3836 0.2767 1.1069 – 1.1069 1.0668
Group 2 0.7339 0.1468 0.5871 0.5198 1.1069 1.0668
Share Class I Gross – Income-2
Group 1 1.5765 – 1.5765 – 1.5765 1.4582
Group 2 0.5080 – 0.5080 1.0685 1.5765 1.4582
Share Class R Net – Accumulation
Group 1 1.2514 0.2503 1.0011 – 1.0011 1.0792
Group 2 0.3988 0.0798 0.3190 0.6821 1.0011 1.0792
Share Class R Net – Income-2
Group 1 1.2680 0.2536 1.0144 – 1.0144 1.0656
Group 2 0.4020 0.0804 0.3216 0.6928 1.0144 1.0656
Share Class S Gross – Accumulation
Group 1 2.9792 – 2.9792 – 2.9792 2.7270
Group 2 2.9792 – 2.9792 – 2.9792 2.7270
Distribution Distribution
Gross Income Net payable paid
Income Tax @20% Income Equalisation 30-Apr-16 30-Apr-15
US cent US cent US cent US cent US cent US cent
Share Class A USD Gross – Accumulation
Group 1 3.3192 – 3.3192 – 3.3192 4.2869
Group 2 3.3192 – 3.3192 – 3.3192 4.2869
Share Class I USD Gross – Accumulation
Group 1 3.9320 – 3.9320 – 3.9320 4.4749
Group 2 2.4722 – 2.4722 1.4598 3.9320 4.4749
Equalisation
Equalisation applies only to shares purchased during the distribution period (Group 2 shares). It is the average amount of income included in the purchase price of
all Group 2 shares and is refunded to holders of these shares as a return of capital. Being capital, it is not liable to income tax but must be deducted from the cost of
shares for capital gains tax purposes.
Emerging Markets Local Currency Debt Fund continued
REPORT AND ACCOUNTS
Investec Funds Series iii 71
Statement of Total ReturnFor the year ended 29 February 2016
29.02.16 28.02.15
Note £’000 £’000 £’000 £’000
Income
Net capital gains 4 4,983 3,961
Revenue 6 1,748 2,921
Expenses 7 (341) (427)
Interest payable and similar charges 9 (78) (66)
Net revenue before taxation 1,329 2,428
Taxation 8 – –
Net revenue after taxation 1,329 2,428
Total return before distribution 6,312 6,389
Distribution 9 (1,331) (2,431)
Change in net assets attributable to
shareholders from investment activities 4,981 3,958
Statement of Change in Net Assets Attributable to ShareholdersFor the year ended 29 February 2016
29.02.16 28.02.15
£’000 £’000 £’000 £’000
Opening net assets attributable to shareholders 106,536 141,655
Amounts receivable on creation of shares 11,232 2,572
Amounts payable on cancellation of shares (43,222) (41,945)
(31,990) (39,373)
Dilution adjustment – 26
Change in net assets attributable to
shareholders from investment activities 4,981 3,958
Retained distribution on accumulation shares 177 270
Closing net assets attributable to shareholders 79,704 106,536
Notes to the fi nancial statements are on pages 72 to 80.
Balance SheetAs at 29 February 2016
29.02.16 28.02.15
Note £’000 £’000 £’000 £’000
ASSETS
Investment assets 76,012 100,506
Current assets
Debtors 10 1,323 1,005
Cash and bank balances 11 17,832 23,109
Total other assets 19,155 24,114
Total assets 95,167 124,620
LIABILITIES
Investment liabilities 3,318 6,286
Creditors
Bank overdrafts 11,162 10,242
Distribution payable 495 1,094
Other creditors 12 488 462
Total other liabilities 12,145 11,798
Total liabilities 15,463 18,084
Net assets attributable to shareholders 79,704 106,536
Notes to the fi nancial statements are on pages 72 to 80.
Global Bond Fund
REPORT AND ACCOUNTS
Investec Funds Series iii72
Notes to the Financial StatementsFor the year ended 29 February 2016
1. Accounting policies
The Accounting policies for the Fund are disclosed in the notes to the fi nancial statements on page 53.
2. Distribution policies
The Distribution policies for the Fund are disclosed in the notes to the fi nancial statements on page 54.
3. Risk management policies
The Risk management policies for the Fund are disclosed in the notes to the fi nancial statements on page 54-57.
4. Net capital gains
The net capital gains during the year comprise:
29.02.16 28.02.15
£’000 £’000
Non-derivative securities 2,937 2,538
Derivative contracts 596 (1,700)
Forward currency contracts 1,766 3,452
Losses on foreign exchange (307) (320)
Transaction charges (9) (9)
Net capital gains 4,983 3,961
5. Purchases, sales and transaction costs
There were no transactions costs incurred during the year to 29 February 2016.
Purchases Sales
29.02.16 28.02.15 29.02.16 28.02.15
£’000 £’000 £’000 £’000
Bonds 131,912 91,772 152,445 135,002
Collective Investment Schemes – – 4,585 3,933
Futures* – – – –
Options – 11 – 5
Swaps 4,731 14,787 4,639 14,328
Cash collateral – – 120 290
Trades excluding transaction costs 136,6 43 106,570 161,78 9 153,558
Commissions
Bonds – – – –
Collective Investment Schemes – – – –
Futures* – – – –
Options – – – –
Swaps – – – –
Cash collateral – – – –
Taxes
Bonds – – – –
Collective Investment Schemes – – – –
Futures* – – – –
Options – – – –
Swaps – – – –
Cash collateral – – – –
Total costs – – – –
Net trades in the year after transaction costs 136,651 106,570 161,780 153,558
* Purchases and/or sales of future contracts do not incur transaction costs and have been included at the value of their exposure.
REPORT AND ACCOUNTS
Investec Funds Series iii 73
Total transaction cost expressed as a percentage of asset type cost
Purchases Sales
29.02.16 28.02.15 29.02.16 28.02.15
% % % %
Commissions
Bonds – – – –
Collective Investment Schemes – – – –
Futures – – – –
Options – – – –
Swaps – – – –
In-specie transfers – – – –
Taxes
Bonds – – – –
Collective Investment Schemes – – – –
Futures – – – –
Options – – – –
Swaps – – – –
Cash collateral – – – –
Total transaction cost expressed as a percentage of average net asset value
29.02.16 28.02.15
% %
Commissions – –
Taxes – –
Total costs – –
Average portfolio dealing spread
The average portfolio dealing spread at the balance sheet was 0.24% (28.02.15: 0.17%).
6. Revenue
29.02.16 28.02.15
£’000 £’000
Overseas dividends 6 –
Interest on debt securities 1,710 2,581
Offshore distribution taxable from collective investment schemes (3) 296
Bank interest 7 5
Margin interest 17 13
Stocklending income* 11 26
Total revenue 1,748 2,921
7. Expenses
29.02.16 28.02.15
£’000 £’000
Payable to the ACD or associates of the ACD, and agents of either of them:
ACD fee 264 321
General administration charge (GAC) 64 89
328 410
Payable to the Depositary or associates of the Depositary, and agents of either of them:
Safe custody fee 14 21
14 21
Other expenses:
Stock lending fee 1 3
VAT refund (2) (7)
(1) (4)
Total expenses 341 427
Please refer to the Prospectus for a full description of expenses covered by the GAC.
The audit fee for the year is £11,000 (28.02.15: £11,000).
VAT is currently recovered in respect of certain expenses paid under the GAC.
REPORT AND ACCOUNTS
Investec Funds Series iii74
Notes to the Financial Statements continuedFor the year ended 29 February 2016
8. Taxation
a) Analysis of the tax charge in the year:
29.02.16 28.02.15
£’000 £’000
Overseas tax 1 –
Adjustments in respect of prior years (1) –
Current tax charge (note 8(b)) – –
Deferred tax charge (note 8(c)) – –
Total tax charge – –
b) Factors affecting current tax charge for the year:
The tax assessed for the year is lower than the standard rate of corporation tax in the UK for an authorised OEIC (20%) (28.02.15: 20%). The differences are explained
below:
29.02.16 28.02.15
£’000 £’000
Net revenue before taxation 1,329 2,428
Corporation tax of 20% 266 486
Effects of:
Tax deductible interest distributions (266) (486)
Adjustments in respect of prior years (1) –
Overseas tax 1 –
Current tax charge (note 8(a)) – –
c) Provision for deferred taxation:
There is no provision required for deferred taxation at the Balance Sheet date in the current or prior year.
9. Finance costs
Distributions and Interest
The Distributions take account of equalisation received on the creation of shares and deducted on the cancellation of shares, and comprises:
29.02.16 28.02.15
£’000 £’000
Interim 546 1,049
Final 560 1,185
Income tax deducted at source 59 103
1,165 2,337
Add: Equalisation deducted on cancellation of shares 228 102
Less: Equalisation received on creation of shares (62) (8)
Finance costs: Distribution 1,331 2,431
Finance cost: Interest 4 2
Finance cost: Margin interest 74 64
78 66
Total fi nance costs 1,409 2,497
The net distribution for the year is represented by:
29.02.16 28.02.15
£’000 £’000
Net revenue after taxation 1,329 2,428
Equalisation on conversion shares 2 3
Finance costs: Distribution 1,331 2,431
10. Debtors
29.02.16 28.02.15
£’000 £’000
Amounts receivable for creation of shares 565 56
Sales awaiting settlement 130 –
Accrued bond interest 620 944
Income tax recoverable 5 5
Overseas tax recoverable 3 –
1,323 1,005
REPORT AND ACCOUNTS
Investec Funds Series iii 75
11. Cash and bank balances
29.02.16 28.02.15
£’000 £’000
Cash and bank balances 5,542 11,925
Amounts held at futures clearing houses and brokers 12,290 11,184
17,832 23,109
12. Creditors
29.02.16 28.02.15
£’000 £’000
Amounts payable for cancellation of shares 67 34
Purchases awaiting settlement 391 394
Accrued ACD fee 20 23
Accrued general administration charge 5 7
Accrued safe custody fee 3 3
Accrued transaction charges 2 1
488 462
13. Capital commitments and contingent liabilities
The Fund had no contingent liabilities or capital commitments at the year end date. (28.02.15: Nil).
14. Related party transactions
Investec Fund Managers Limited, as Authorised Corporate Director (ACD), is a related party, and acts as a principal in respect of all transactions of shares in the
Company. The aggregate monies received through issues and paid on cancellation of shares are disclosed in the Statement of Change in Shareholders’ Net Assets.
In accordance with the prospectus the ACD collects from the Fund, a general administration charge (GAC), ACD fees and safe custody fees. Please refer to notes 7,
12 and 16 for further details.
Any amounts due to/from Investec Fund Managers Limited at the end of the accounting year are disclosed in notes 10 and 12.
At the year end date nil% of the Fund’s shares (by net asset value) were held by other Funds managed by the ACD (28.02.15: 69.94%).
15. Dilution adjustment
Please refer to note 4 of the notes to the fi nancial statements of the company for a detailed description of dilution adjustment.
16. ACD fees and charges
The different level of ACD fees payable per annum as at 29 February 2016 for each share class is detailed below:
A Shares 1.00%
I Shares 0.50%
R Shares 0.75%
S Shares 0.00%
The GAC is charged at 0.08% of the Net Asset Value of each share class.
All shares within the sub-fund have the same rights on winding up.
Reconciliation of the shares movement in the year
28.02.15 29/02/16
Opening Closing
shares in Shares shares in
issue Creations Cancellations converted issue
‘A’ Net Class (Accumulation shares) 18,367,208 1,235,708 (3,545,094) (204,786) 15,853,036
‘A’ Net Class (Income shares) 4,666,984 64,824 (1,206,337) (2,192,284) 1,333,187
‘A’ Gross Class (Income shares) 1,301,971 23,110 (486,797) (5,194) 833,090
‘A’ Net Class (USD Income shares) 347,151 2,383 (310,246) – 39,288
‘I’ Net Class (Accumulation shares) 1,761,44 5 3,256,124 (785,813) 230,417 4,462,173
‘I’ Net Class (Income shares) 436,4 09 23,253 (256,083) 210,457 414,036
‘I’ Gross Class (Income shares) 69,985 5,890 (29,514) 485 46,846
‘R’ Net Class (Accumulation shares) 6,250 8 – – 6,258
‘S’ Gross Class (Income shares) 83,082,345 6,642,804 (39,470,678) – 50,254,471
REPORT AND ACCOUNTS
Investec Funds Series iii76
Notes to the Financial Statements continuedFor the year ended 29 February 2016
17. Risk considerations
Please refer to note 3 of the notes to the fi nancial statements of the company for a detailed description of the risk considerations. There are no further specifi c risks
for this Fund.
The Fund’s currency exposure as at 29 February 2016 was:
Currency exposure
Total Total
29.02.16 28.02.15
Currency £’000 £’000
Australian Dollar 7,618 (17)
Brazilian Real (3) (449)
Canadian Dollar (779) (1,603)
Chilean Peso (68) 1,175
Chinese Yuan – 157
Chinese Yuan (Offshore) 8 3,909
Colombian Peso (2) (2,218)
Czech Koruna 3,995 139
Danish Krone – (21)
Euro 14,526 29,121
Hong Kong Dollar – 158
Hungarian Forint 1,239 (8)
Indian Rupee 31 1,964
Indonesian Rupiah (4) 3,676
Israeli Shekel 41 (5,543)
Japanese Yen 14,980 14,618
Malaysian Ringgit (1,088) 155
Mexican Peso 1,427 4,768
New Zealand Dollar 8 (2,600)
Norwegian Krone (3,611) (362)
Peruvian Nuevo Sol 25 (2,934)
Philippine Peso 6 2,593
Polish Zloty 3,051 (1,328)
Romanian Leu (4) 38
Singapore Dollar (1,082) (3,442)
South African Rand (212) (828)
South Korean Won (1,565) (2,670)
Sterling 3,177 6,790
Swedish Krona 2,992 1,684
Swiss Franc (4,082) (1,102)
Taiwan Dollar (1,082) (3,853)
Thai Baht – (3,145)
Turkish Lira 3 1,329
US Dollar 40,159 66,385
Total 79,704 106,536
REPORT AND ACCOUNTS
Investec Funds Series iii 77
Interest rate risk profi le of fi nancial assets and liabilities as at 29 February 2016 was as follows:
Financial
Floating rate Fixed rate assets not
fi nancial fi nancial carrying
assets assets interest Total
29.02.16 29.02.16 29.02.16 29.02.16
Currency £’000 £’000 £’000 £’000
Australian Dollar 771 4,248 2,778 7,797
Brazilian Real 10 – – 10
Canadian Dollar 5 3,439 31 3,475
Chinese Yuan (Offshore) 10 – – 10
Czech Koruna – 2,334 1,661 3,995
Euro 2,590 20,764 126 23,480
Hungarian Forint – 3,897 13 3,910
Indian Rupee – – 31 31
Israeli Shekel – 3,287 88 3,375
Japanese Yen 1,451 2,323 11,206 14,980
Mexican Peso – – 1,427 1,427
New Zealand Dollar – – 8 8
Norwegian Krone 1 6,798 168 6,967
Peruvian Nuevo Sol – – 25 25
Philippine Peso – – 6 6
Polish Zloty 2 – 3,049 3,051
Romanian Leu 4 – – 4
Singapore Dollar 3 – 1 4
South African Rand 63 – 1 64
South Korean Won 251 – 41 292
Sterling 7,182 3,180 616 10,978
Swedish Krona – 509 2,483 2,992
Swiss Franc – 594 8 602
Taiwan Dollar – – 1 1
Turkish Lira 1 2 – 3
US Dollar 5,495 19,168 25,504 50,167
Total 17,839 70,543 49,272 137,654
Financials
Floating rate liabilities not
fi nancial carrying
liabilities interest Total
29.02.16 29.02.16 29.02.16
Currency £’000 £’000 £’000
Australian Dollar – 179 179
Brazilian Real – 13 13
Canadian Dollar 894 3,360 4,254
Chilean Peso – 68 68
Chinese Yuan (Offshore) – 2 2
Colombian Peso – 2 2
Euro – 8,954 8,954
Hungarian Forint – 2,671 2,671
Indonesian Rupiah – 4 4
Israeli Shekel – 3,334 3,334
Malaysian Ringgit – 1,088 1,088
Norwegian Krone – 10,578 10,578
Romanian Leu – 8 8
Singapore Dollar – 1,086 1,086
South African Rand – 276 276
South Korean Won – 1,857 1,857
Sterling – 7,801 7,801
Swiss Franc 313 4,371 4,684
Taiwan Dollar – 1,083 1,083
US Dollar 9,962 46 10,008
Total 11,169 46,781 57,950
REPORT AND ACCOUNTS
Investec Funds Series iii78
Notes to the Financial Statements continuedFor the year ended 29 February 2016
Interest rate risk profi le of fi nancial assets and liabilities as at 28 February 2015 was as follows:
Financial
Floating rate Fixed rate assets not
fi nancial fi nancial carrying
assets assets interest Total
28.02.15 28.02.15 28.02.15 28.02.15
Currency £’000 £’000 £’000 £’000
Australian Dollar 720 – 100 820
Brazilian Real – 610 9 619
Canadian Dollar – 4,686 45 4,731
Chilean Peso – 946 229 1,175
Chinese Yuan – – 157 157
Chinese Yuan (Offshore) – – 3,909 3,909
Colombian Peso – 766 47 813
Czech Koruna – – 139 139
Danish Krone – 595 4 599
Euro 1,641 28,175 213 30,029
Hong Kong Dollar – – 158 158
Hungarian Forint – 230 9 239
Indian Rupee – – 1,964 1,964
Indonesian Rupiah – 265 3,411 3,676
Israeli Shekel – 2,217 71 2,288
Japanese Yen 1,047 2,489 11,082 14,618
Malaysian Ringgit – – 155 155
Mexican Peso 35 1,025 3,708 4,768
New Zealand Dollar 2 – – 2
Norwegian Krone 1 1,232 32 1,265
Peruvian Nuevo Sol – 390 1 391
Philippine Peso – 252 2,341 2,593
Polish Zloty 1 299 9 309
Romanian Leu – 244 6 250
South African Rand 199 1,333 19 1,551
South Korean Won 251 – 36 287
Sterling 7,450 11,864 2,818 22,132
Swedish Krona – – 1,684 1,684
Turkish Lira – – 1,329 1,329
US Dollar 11,880 30,530 33,320 75,730
Total 23,227 88,148 67,005 178,380
Financials
Floating rate liabilities not
fi nancial carrying
liabilities interest Total
28.02.15 28.02.15 28.02.15
Currency £’000 £’000 £’000
Australian Dollar – 837 837
Brazilian Real – 1,068 1,068
Canadian Dollar 997 5,337 6,334
Colombian Peso – 3,031 3,031
Danish Krone – 620 620
Euro – 908 908
Hungarian Forint – 247 247
Israeli Shekel – 7,831 7,831
New Zealand Dollar – 2,602 2,602
Norwegian Krone – 1,627 1,627
Peruvian Nuevo Sol – 3,325 3,325
Polish Zloty – 1,637 1,637
Romanian Leu – 212 212
Singapore Dollar – 3,442 3,442
South African Rand – 2,379 2,379
South Korean Won – 2,957 2,957
Sterling – 15,342 15,342
Swiss Franc 295 807 1,102
Taiwan Dollar – 3,853 3,853
Thai Baht – 3,145 3,145
US Dollar 8,950 395 9,345
Total 10,242 61,602 71,844
REPORT AND ACCOUNTS
Investec Funds Series iii 79
18. Effi cient portfolio management techniques risk exposure
The exposure obtained through effi cient portfolio management techniques and identity of counterparties as at 29 February 2016 was as follows:
a) Stock lending
The aggregate value of securities on loan at 29 February 2016 is £nil (28.02.15: £13,737,000). The identities of these counterparties are listed in the counterparties
table below. Securities on loan are included in the portfolio statement and no account is taken of any collateral held. The aggregate value of collateral held at 29
February 2016 is £nil (28.02.15: £14,004,000). This collateral is listed in the collateral held table below.
29.02.16 28.02.15
Value of stock on loan by counterparty £’000 £’000
Barclays – 330
BNP Paribas – 6,100
Citigroup – 6,463
Credit Suisse – 269
Goldman Sachs – 255
HSBC – 248
JPMorgan – 72
Total – 13,737
29.02.16 28.02.15
Collateral held £’000 £’000
Cash – 14,004
b) Swap
Value of Value of
collateral collateral
29.02.16 28.02.15
Counterparty £’000 £’000
Citigroup – 70
Morgan Stanley – 50
Total – 120
c) Forwards
Market value Market value
29.02.16 28.02.15
Counterparty £’000 £’000
Barclays Bank 524 –
Citibank 1,973 334
Deutsche Bank 34 266
Goldman Sachs (27) 43
HSBC (74) 210
JPMorgan (118) 89
Royal Bank of Scotland – (1)
Standard Chartered Bank (55) –
State Street Bank (11) (139)
Total 2,246 802
d) Futures
Value of
Market value exposure
29.02.16 29.02.16
Counterparty £’000 £’000
Goldman Sachs (95) 139,415
Total (95) 139,415
Futures
Value of
Market value exposure
28.02.15 28.02.15
Counterparty £’000 £’000
Goldman Sachs 209 82,022
Total 209 82,022
REPORT AND ACCOUNTS
Investec Funds Series iii80
Notes to the Financial Statements continuedFor the year ended 29 February 2016
18. Fair value
29.02.16 28.02.15
Assets Liabilities Assets Liabilities
Valuation technique £’000 £’000 £’000 £’000
Quoted prices for identical instruments in an active market 36,271 (340) 295 (86)
Prices of recent transactions for identical instruments – – 5,076 –
Valuation techniques using observable market data 39,741 (2,978) 95,135 (6,200)
Total fair value 76,012 (3,318) 100,506 (6,286)
REPORT AND ACCOUNTS
Investec Funds Series iii 81
Global Bond Fund
Distribution TableFor the year ended 29 February 2016
Interim distribution paid 31 October 2015
Group 1 – shares purchased before 1 March 2015
Group 2 – shares purchased between 1 March 2015 and 31 August 2015
Distribution Distribution
Gross Income Net paid paid
Income Tax @20% Income Equalisation 31-Oct-15 31-Oct-14
pence pence pence pence pence pence
Share Class A Net – Accumulation
Group 1 0.5443 0.1089 0.4354 – 0.4354 0.5880
Group 2 0.2426 0.0485 0.1941 0.2413 0.4354 0.5880
Share Class A Net – Income
Group 1 0.4270 0.0854 0.3416 – 0.3416 0.4582
Group 2 0.2688 0.0538 0.2150 0.1266 0.3416 0.4582
Share Class A Gross – Income
Group 1 0.4309 – 0.4309 – 0.4309 0.5881
Group 2 0.2250 – 0.2250 0.2059 0.4309 0.5881
Share Class I Net – Accumulation
Group 1 0.7300 0.1460 0.5840 – 0.5840 0.7027
Group 2 0.3249 0.0650 0.2599 0.3241 0.5840 0.7027
Share Class I Net – Income
Group 1 6.7689 1.3538 5.4151 – 5.4151 6.6777
Group 2 4.1548 0.8310 3.3238 2.0913 5.4151 6.6777
Share Class I Gross – Income
Group 1 6.9517 – 6.9517 – 6.9517 8.5800
Group 2 3.0382 – 3.0382 3.9135 6.9517 8.5800
Share Class R Net – Accumulation
Group 1 0.6248 0.1250 0.4998 – 0.4998 0.6660
Group 2 0.6248 0.1250 0.4998 – 0.4998 0.6660
Share Class S Gross – Income
Group 1 0.8728 – 0.8728 – 0.8728 1.0218
Group 2 0.5152 – 0.5152 0.3576 0.8728 1.0218
Distribution Distribution
Gross Income Net paid paid
Income Tax @20% Income Equalisation 31-Oct-15 31-Oct-14
U S cent U S cent U S cent U S cent U S cent U S cent
Share Class A USD Net – Income
Group 1 0.8361 0.1672 0.6689 – 0.6689 0.7803
Group 2 0.6470 0.1294 0.5176 0.1513 0.6689 0.7803
REPORT AND ACCOUNTS
Investec Funds Series iii82
Distribution TableFor the year ended 29 February 2016
Final distribution payable 30 April 2016
Group 1 – shares purchased before 1 September 2015
Group 2 – shares purchased between 1 September 2015 and 29 February 2016
Distribution Distribution
Gross Income Net payable paid
Income Tax @20% Income Equalisation 30-Apr-16 30-Apr-15
pence pence pence pence pence pence
Share Class A Net – Accumulation
Group 1 0.5328 0.1066 0.4262 – 0.4262 0.7125
Group 2 0.3343 0.0669 0.2674 0.1588 0.4262 0.7125
Share Class A Net – Income
Group 1 0.4179 0.0836 0.3343 – 0.3343 0.5703
Group 2 0.2121 0.0424 0.1697 0.1646 0.3343 0.5703
Share Class A Gross – Income
Group 1 0.4183 – 0.4183 – 0.4183 0.7077
Group 2 0.2530 – 0.2530 0.1653 0.4183 0.7077
Share Class I Net – Accumulation
Group 1 0.7119 0.1424 0.5695 – 0.5695 0.8144
Group 2 0.1273 0.0255 0.1018 0.4677 0.5695 0.8144
Share Class I Net – Income
Group 1 6.5621 1.3124 5.2497 – 5.2497 7.7459
Group 2 2.0631 0.4126 1.6505 3.5992 5.2497 7.7459
Share Class I Gross – Income
Group 1 6.8494 – 6.8494 – 6.8494 9.9545
Group 2 1.5139 – 1.5139 5.3355 6.8494 9.9545
Share Class R Net – Accumulation
Group 1 0.6014 0.1203 0.4811 – 0.4811 0.7396
Group 2 0.4205 0.0841 0.3364 0.1447 0.4811 0.7396
Share Class S Gross – Income
Group 1 0.8641 – 0.8641 – 0.8641 1.1567
Group 2 0.1956 – 0.1956 0.6685 0.8641 1.1567
Distribution Distribution
Gross Income Net payable paid
Income Tax @20% Income Equalisation 30-Apr-16 30-Apr-15
U S cent U S cent U S cent U S cent U S cent U S cent
Share Class A USD Net – Income
Group 1 0.5913 0.1183 0.4730 – 0.4730 0.8499
Group 2 0.4255 0.0851 0.3404 0.1326 0.4730 0.8499
Equalisation
Equalisation applies only to shares purchased during the distribution period (Group 2 shares). It is the average amount of income included in the purchase price of
all Group 2 shares and is refunded to holders of these shares as a return of capital. Being capital, it is not liable to income tax but must be deducted from the cost
of shares for capital gains tax purposes.
Global Bond Fund continued
REPORT AND ACCOUNTS
Investec Funds Series iii 83
Statement of Total ReturnFor the year ended 29 February 2016
29.02.16 28.02.15
Note £’000 £’000 £’000 £’000
Income
Net capital (losses)/gains 4 ( 31,226) 92,103
Revenue 6 13,166 12,817
Expenses 7 (3,073) (1,277)
Interest payable and similar charges 9 (3) (1)
Net revenue before taxation 10,090 11,539
Taxation 8 (1,071) (1,005)
Net revenue after taxation 9,019 10,534
Total return before distributions ( 22,207) 102,637
Distribution 9 (8,811) (8,571)
Change in net assets attributable to
shareholders from investment activities ( 31,018) 94,066
Statement of Change in Net Assets Attributable to ShareholdersFor the year ended 29 February 2016
29.02.16 28.02.15
£’000 £’000 £’000 £’000
Opening net assets attributable to shareholders 742,513 640,761
Amounts receivable on creation of shares 47,319 44,065
Amounts payable on cancellation of shares (130,636) (44,803)
(83,317) (738)
Change in net assets attributable to
shareholders from investment activities ( 31,018) 94,066
Retained distribution on accumulation shares 7,967 8,424
Closing net assets attributable to shareholders 63 6,145 742,513
Notes to the fi nancial statements are on pages 84 to 87.
Balance SheetAs at 29 February 2016
29.02.16 28.02.15
Note £’000 £’000 £’000 £’000
ASSETS
Investment assets 6 17,840 712,127
Current assets
Debtors 10 1,872 1,883
Cash and bank balances 11 16,685 28,689
Total other assets 18,557 30,572
Total assets 6 36,397 742,699
LIABILITIES
Creditors
Other creditors 12 252 186
Total liabilities 252 186
Net assets attributable to shareholders 63 6,145 742,513
Notes to the fi nancial statements are on pages 84 to 87.
Global Dynamic Fund
REPORT AND ACCOUNTS
Investec Funds Series iii84
1. Accounting policies
The Accounting policies for the Fund are disclosed in the notes to the fi nancial statements on page 53 .
2. Distribution policies
The Distribution policies for the Fund are disclosed in the notes to the fi nancial statements on page 54.
3. Risk management policies
The Risk management policies for the Fund are disclosed in the notes to the fi nancial statements on page 54-57.
4. Net capital (losses)/gains
The net capital (losses)/gains during the year comprise:
29.02.16 28.02.15
£’000 £’000
Non-derivative securities ( 30,785) 92,471
Losses on foreign exchange (40 0) (345)
Transaction charges (41) (23)
Net capital (losses)/gains ( 31,226) 92,103
5. Purchases, sales and transaction costs
Analysis of total trade costs.
Purchases Sales
29.02.16 28.02.15 29.02.16 28.02.15
£’000 £’000 £’000 £’000
Equities 443,152 232,562 507,180 225,527
Commissions
Equities 236 158 (254) (130)
Taxes
Equities 198 50 (55) (44)
Total costs 434 208 (309) (174)
Net trades in the year after transaction costs 443,586 232,770 506,871 225,353
Total transaction cost expressed as a percentage of asset type cost.
Purchases Sales
29.02.16 28.02.15 29.02.16 28.02.15
% % % %
Commissions
Equities 0.05 0.07 0.05 0.06
Taxes
Equities 0.04 0.02 0.01 0.02
Average portfolio dealing spread
The average portfolio dealing spread at the balance sheet was 0.15% (28.02.15: 0.07%).
6. Revenue
29.02.16 28.02.15
£’000 £’000
UK dividends 1,622 1,324
Overseas dividends 11,480 11,408
Bank interest 63 72
Stocklending income – 11
Interest on foreign tax reclaims amounts 1 2
Total revenue 13,166 12,817
Notes to the Financial StatementsFor the year ended 29 February 2016
REPORT AND ACCOUNTS
Investec Funds Series iii 85
7. Expenses
29.02.16 28.02.15
£’000 £’000
Payable to the ACD or associates of the ACD, and agents of either of them:
ACD fee 2,076 574
General administration charge (GAC) 561 530
Performance fee 274 19
2,911 1,123
Payable to the Depositary or associates of the Depositary, and agents of either of them:
Safe custody fee 148 146
148 146
Other expenses:
Stock lending fee – 1
VAT refund (13) (13)
DTC fees – 1
ADR issuance fees 23 19
Out of pocket expenses 1 –
HSBC renewal fees 3 –
14 8
Total expenses 3,073 1,277
Please refer to the Prospectus for a full description of expenses covered by the GAC.
The audit fee for the year is £8,000 (28.02.15: £8,000).
VAT is currently recovered in respect of certain expenses paid under the GAC.
8. Taxation
a) Analysis of the tax charge in the year:
29.02.16 28.02.15
£’000 £’000
Overseas tax 1,071 1,000
Indian capital gains tax – 5
Current tax charge (note 8(b)) 1,071 1,005
Deferred tax charge (note 8(c)) – –
Total tax charge 1,071 1,005
b) Factors affecting current tax charge for the year:
The tax assessed for the year is lower than the standard rate of corporation tax in the UK for an authorised OEIC (20%) (28.02.15: 20%). The differences are
explained below:
29.02.16 28.02.15
£’000 £’000
Net revenue before taxation 10,090 11,539
Corporation tax of 20% 2,018 2,308
Effects of:
Revenue not subject to taxation (2,596) (2,490)
Overseas tax expensed (8) (11)
Movement in excess management expenses 586 193
Overseas tax 1,071 1,000
Indian capital gains tax – 5
Current tax charge (note 8(a)) 1,071 1,005
c) Provision for deferred taxation:
There is no provision required for deferred taxation at the Balance Sheet date in the current or prior year.
d) Factors affecting future tax charge:
The Fund has surplus management expenses that have resulted in an unrecognised deferred asset of £847,000 (28.02.15: £261,000). This asset has not been
recognised in the fi nancial statements due to the inherent uncertainty of the Fund to generate suffi cient taxable net revenue.
REPORT AND ACCOUNTS
Investec Funds Series iii86
Notes to the Financial Statements continuedFor the year ended 29 February 2016
9. Finance costs
Distributions and interest
The Distributions take account of equalisation received on the creation of shares and deducted on the cancellation of shares, and comprises:
29.02.16 28.02.15
£’000 £’000
Final 7,967 8,424
7,967 8,424
Add: Equalisation deducted on cancellation of shares 1,149 311
Less: Equalisation received on creation of shares (305) (164)
Finance costs: Distribution 8,811 8,571
Finance cost: Interest 3 1
Total fi nance costs 8,814 8,572
The net distribution for the year is represented by:
29.02.16 28.02.15
£’000 £’000
Net revenue after taxation 9,019 10,534
Equalisation on conversion shares (208) (1,968)
Indian capital gains tax – 5
Finance costs: Distribution 8,811 8,571
10. Debtors
29.02.16 28.02.15
£’000 £’000
Amounts receivable for creation of shares 3 11
Accrued dividends and bank interest 1,353 1,427
Overseas tax recoverable 516 445
1,872 1,883
11. Cash and bank balances
29.02.16 28.02.15
£’000 £’000
Cash and bank balances 16,685 28,689
16,685 28,689
12. Creditors
29.02.16 28.02.15
£’000 £’000
Accrued ACD fee 168 106
Accrued general administration charge 38 45
Accrued safe custody fee 34 24
Accrued performance fee – 8
Accrued transaction charges 12 3
252 186
13. Capital commitments and contingent liabilities
The Fund had no contingent liabilities or capital commitments at the year end date. (28.02.15: Nil).
14. Related party transactions
Investec Fund Managers Limited, as Authorised Corporate Director (ACD), is a related party, and acts as a principal in respect of all transactions of shares in the
Company. The aggregate monies received through issues and paid on cancellation of shares are disclosed in the Statement of Change in Shareholders’ Net Assets.
In accordance with the prospectus the ACD collects from the Fund, a general administration charge (GAC), ACD fees and safe custody fees. Please refer to notes 7,
12 and 16 for further details.
Any amounts due to/from Investec Fund Managers Limited at the end of the accounting year are disclosed in notes 10 and 12.
At the year end date 1.08% of the Fund’s shares (by net asset value) were held by other Funds managed by the ACD (28.02.15: 14.98%).
15. Dilution adjustment
Please refer to note 4 of the notes to the fi nancial statements of the company for a detailed description of dilution adjustment.
REPORT AND ACCOUNTS
Investec Funds Series iii 87
16. ACD fees and charges
The different level of ACD fees payable per annum as at 29 February 2016 for each share class is detailed below:
A Shares 1.50%
B Shares 0.50%
I Shares 0.75%
R Shares 1.00%
S Shares 0.00%
The GAC is charged at 0.08% of the Net Asset Value of each share class.
All shares within the sub-fund have the same rights on winding up.
Reconciliation of the shares movement in the year
28.02.15 29.02.16
Opening Closing
shares in Shares shares in
issue Creations Cancellations converted issue
‘A’ Net Class (Accumulation shares) 1,101,333 4,029,960 (2,132,727) (181,710) 2,816,856
‘A’ Net Class (USD Accumulation shares) 795,021 – (48,207) – 746,814
‘B’ Class (Accumulation shares) 144,886,366 – – – 144,886,366
‘I’ Gross Class (Accumulation shares) 39,682,042 21,337,032 (22,563,960) 63,295,801 101,750,915
‘I’ Net Class (EUR Accumulation shares) – 320,739 (620) – 320,119
‘R’ Net Class (Accumulation shares) 84,225 – – – 84,225
‘S’ Gross Class (Accumulation shares) 250,933,247 2,599,143 (45,058,504) (59,502,161) 148,971,725
17. Risk considerations
Please refer to note 3 of the notes to the fi nancial statements of the company for a detailed description of the risk considerations. There are no further specifi c risks
for this Fund.
The Fund’s currency exposure as at 29 February 2016 was:
Currency exposure
Total Total
29.02.16 28.02.15
Currency £’000 £’000
Australian Dollar 11,429 21,888
Canadian Dollar 25 4,521
Euro 39,379 63,504
Hong Kong Dollar 36,336 45,206
Indian Rupee 5 –
Japanese Yen 38,079 48,305
Mexican Peso 12,037 10,929
Norwegian Krone – 12,736
Sterling 50,695 65,648
Swedish Krona – 4
Swiss Franc 12,941 21,793
Taiwan Dollar – 21
Thai Baht – 12,370
US Dollar 43 5,219 435,588
Total 63 6,145 742,513
The majority of the Fund’s fi nancial assets are equity shares and other investments which neither pay interest nor have a maturity date. Therefore, the fund’s exposure
to interest rate risk is not considered to be signifi cant.
18. Fair value
29.02.16 28.02.15
Assets Liabilities Assets Liabilities
Valuation technique £000 £000 £000 £000
Quoted prices for identical instruments in an active market 6 17,840 – 712,127 –
REPORT AND ACCOUNTS
Investec Funds Series iii88
Global Dynamic Fund
Distribution TableFor the year ended 29 February 2016
Final distribution payable 30 April 2016
Group 1 shares purchased before 1 March 2015
Group 2 shares purchased between 1 March 2015 and 29 February 2016
Distribution Distribution
Net payable paid
Income Equalisation 30-Apr-16 30-Apr-15
pence pence pence pence
Share Class A – Accumulation
Group 1 0.1220 – 0.1220 0.1758
Group 2 0.0872 0.0348 0.1220 0.1758
Share Class B – Accumulation
Group 1 1.0536 – 1.0536 0.1953
Group 2 1.0536 – 1.0536 0.1953
Share Class I – Accumulation
Group 1 1.6222 – 1.6222 1.5783
Group 2 0.4879 1.1343 1.6222 1.5783
Share Class R – Accumulation
Group 1 0.8634 – 0.8634 0.8591
Group 2 0.8634 – 0.8634 0.8591
Share Class S – Accumulation
Group 1 3.2108 – 3.2108 2.9929
Group 2 0.8160 2.3948 3.2108 2.9929
Distribution Distribution
Net payable paid
Income Equalisation 30-Apr-16 30-Apr-15
Euro cent Euro cent Euro cent Euro cent
Share Class I EUR – Accumulation (1)
Group 1 0.6429 – 0.6429 n/a
Group 2 0.6429 – 0.6429 n/a
Distribution Distribution
Net payable paid
Income Equalisation 30-Apr-16 30-Apr-15
US cent US cent US cent US cent
Share Class A USD – Accumulation
Group 1 0.1753 – 0.1753 0.2895
Group 2 0.1753 – 0.1753 0.2895
(1) Launched 7 April 2015
Equalisation
Equalisation applies only to shares purchased during the distribution period (Group 2 shares). It is the average amount of income included in the purchase price of
all Group 2 shares and is refunded to holders of these shares as a return of capital. Being capital, it is not liable to income tax but must be deducted from the cost of
shares for capital gains tax purposes.
REPORT AND ACCOUNTS
Investec Funds Series iii 89
Statement of Total ReturnFor the year ended 29 February 2016
29.02.16 28.02.15
Note £’000 £’000 £’000 £’000
Income
Net capital (losses)/gains 4 (2 2,31 8) 58,273
Revenue 6 8,511 9,270
Expenses 7 (1,687) (1,228)
Interest payable and similar charges 9 (7) (4)
Net revenue before taxation 6,817 8,038
Taxation 8 (788) (941)
Net revenue after taxation 6,029 7,097
Total return before distributions (1 6,289) 65,370
Distribution 9 (5,793) (7,053)
Change in net assets attributable to
shareholders from investment activities (2 2,082) 58,317
Statement of Change in Net Assets Attributable to ShareholdersFor the year ended 29 February 2016
29.02.16 28.02.15
£’000 £’000 £’000 £’000
Opening net assets attributable to shareholders 477,352 502,000
Amounts receivable on creation of shares 32,163 41,448
Amounts payable on cancellation of shares (196,754) (130,911)
(164,591) (89,463)
Dilution adjustment 67 32
Change in net assets attributable to
shareholders from investment activities (2 2,082) 58,317
Retained distribution on accumulation shares 4,140 6,466
Closing net assets attributable to shareholders 29 4,886 477,352
Notes to the fi nancial statements are on pages 90 to 93.
Balance SheetAs at 29 February 2016
29.02.16 28.02.15
Note £’000 £’000 £’000 £’000
ASSETS
Investment assets 29 1,213 464,585
Current assets
Debtors 10 1,131 2,831
Cash and bank balances 11 3,336 11,013
Total other assets 4,467 13,844
Total assets 29 5,680 478,429
LIABILITIES
Creditors
Distribution payable 79 388
Other creditors 12 715 689
Total liabilities 794 1,077
Net assets attributable to shareholders 29 4,886 477,352
Notes to the fi nancial statements are on pages 90 to 93.
Global Equity Fund
REPORT AND ACCOUNTS
90 Investec Funds Series iii
1. Accounting policies
The Accounting policies for the Fund are disclosed in the notes to the fi nancial statements on page 53.
2. Distribution policies
The Distribution policies for the Fund are disclosed in the notes to the fi nancial statements on page 54.
3. Risk management policies
The Risk management policies for the Fund are disclosed in the notes to the fi nancial statements on page s 54-57.
4. Net capital (losses)/gains
The net capital (losses)/gains during the year comprise:
29.02.16 28.02.15
£’000 £’000
Non-derivative securities (2 1,657) 58,528
Losses on foreign exchange (582) (183)
Transaction charges (7 9) (72)
Net capital (losses)/gains (2 2,318) 58,273
5. Purchases, sales and transaction costs
Analysis of total trade costs.
Purchases Sales
29.02.16 28.02.15 29.02.16 28.02.15
£’000 £’000 £’000 £’000
Equities 142,528 156,461 294,347 246,336
Commissions
Equities 87 96 (123) (107)
Taxes
Equities 50 55 (47) (54)
Total costs 137 151 (170) (161)
Net trades in the year after transaction costs 142,665 156,612 294,177 246,175
Total transaction cost expressed as a percentage of asset type cost.
Purchases Sales
29.02.16 28.02.15 29.02.16 28.02.15
% % % %
Commissions
Equities 0.06 0.06 0.04 0.04
Taxes
Equities 0.04 0.04 0.02 0.02
Average portfolio dealing spread
The average portfolio dealing spread at the balance sheet was 0.20% (28.02.15: 0.09%).
6. Revenue
29.02.16 28.02.15
£’000 £’000
UK dividends 687 503
Overseas dividends 7,711 8,714
Bank interest 11 37
Stocklending income* – 11
Interest on foreign tax reclaims amounts 32 5
Foreign tax reclaims 70 –
Total revenue 8,511 9,270
Notes to the Financial StatementsFor the year ended 29 February 2016
REPORT AND ACCOUNTS
91Investec Funds Series iii
7. Expenses
29.02.16 28.02.15
£’000 £’000
Payable to the ACD or associates of the ACD, and agents of either of them:
ACD fee 1,294 766
General administration charge (GAC) 305 353
1,599 1,119
Payable to the Depositary or associates of the Depositary, and agents of either of them:
Safe custody fee 89 112
89 112
Other expenses:
Stock lending fee – 1
VAT refund (11) (13)
DTC fees – 1
ADR issuance fees 6 8
Out of pocket expenses 1 –
HSBC renewal fees 3 –
(1) (3)
Total expenses 1,687 1,228
Please refer to the Prospectus for a full description of expenses covered by the GAC.
The audit fee for the year is £8,000 (28.02.15: £8,000).
VAT is currently recovered in respect of certain expenses paid under the GAC.
8. Taxation
a) Analysis of the tax charge in the year:
29.02.16 28.02.15
£’000 £’000
Overseas tax 788 941
Current tax charge (note 8(b)) 788 941
Deferred tax charge (note 8(c)) – –
Total tax charge 788 941
b) Factors affecting current tax charge for the year:
The tax assessed for the year is lower than the standard rate of corporation tax in the UK for an authorised OEIC (20%) (28.02.15: 20%). The differences are explained
below:
29.02.16 28.02.15
£’000 £’000
Net revenue before taxation 6,817 8,038
Corporation tax of 20% 1,363 1,608
Effects of:
Revenue not subject to taxation (1,666) (1,791)
Overseas tax expensed (3) (8)
Movement in excess management expenses 306 191
Overseas tax 788 941
Current tax charge (note 8(a)) 788 941
c) Provision for deferred taxation:
There is no provision required for deferred taxation at the Balance Sheet date in the current or prior year.
d) Factors affecting future tax charge:
The Fund has surplus management expenses that have resulted in an unrecognised deferred asset of £1,366,000 (28.02.15: £1,060,000). This asset has not been
recognised in the fi nancial statements due to the inherent uncertainty of the Fund to generate suffi cient taxable net revenue.
REPORT AND ACCOUNTS
92 Investec Funds Series iii
Notes to the Financial Statements continuedFor the year ended 29 February 2016
9. Finance costs
Distributions and Interest
The Distributions take account of equalisation received on the creation of shares and deducted on the cancellation of shares, and comprises:
29.02.16 28.02.15
£’000 £’000
Final 4,219 6,854
4,219 6,854
Add: Equalisation deducted on cancellation of shares 1,945 513
Less: Equalisation received on creation of shares (371) (314)
Finance costs: Distribution 5,793 7,053
Finance cost: Interest 7 4
Total fi nance costs 5,800 7,057
The net distribution for the year is represented by:
29.02.16 28.02.15
£’000 £’000
Net revenue after taxation 6,029 7,097
Equalisation on conversion shares (236) (44)
Finance costs: Distribution 5,793 7,053
10. Debtors
29.02.16 28.02.15
£’000 £’000
Amounts receivable for creation of shares 18 266
Sales awaiting settlement 376 1,610
Accrued dividends and bank interest 432 627
Overseas tax recoverable 305 328
1,131 2,831
11. Cash and bank balances
29.02.16 28.02.15
£’000 £’000
Cash and bank balances 3,336 11,013
3,336 11,013
12. Creditors
29.02.16 28.02.15
£’000 £’000
Amounts payable for cancellation of shares 415 69
Purchases awaiting settlement 134 490
Accrued ACD fee 106 73
Accrued general administration charge 18 29
Accrued safe custody fee 18 18
Accrued transaction charges 24 10
715 689
13. Capital commitments and contingent liabilities
The Fund had no contingent liabilities or capital commitments at the year end date. (28.02.15: Nil).
14. Related party transactions
Investec Fund Managers Limited, as Authorised Corporate Director (ACD), is a related party, and acts as a principal in respect of all transactions of shares in the
Company. The aggregate monies received through issues and paid on cancellation of shares are disclosed in the Statement of Change in Shareholders’ Net Assets.
In accordance with the prospectus the ACD collects from the Fund, a general administration charge (GAC), ACD fees and safe custody fees. Please refer to notes 7,
12 and 16 for further details.
Any amounts due to/from Investec Fund Managers Limited at the end of the accounting year are disclosed in notes 10 and 12.
At the year end date 1.78% of the Fund’s shares (by net asset value) were held by other Funds managed by the ACD (28.02.15: 52.61%).
15. Dilution adjustment
Please refer to note 4 of the notes to the fi nancial statements of the company for a detailed description of dilution adjustment.
REPORT AND ACCOUNTS
93Investec Funds Series iii
16. ACD fees and charges
The different level of ACD fees payable per annum as at 29 February 2016 for each share class is detailed below:
A Shares 1.50%
I Shares 0.75%
R Shares 1.00%
S Shares 0.00%
The GAC is charged at 0.08% of the Net Asset Value of each share class.
All shares within the sub-fund have the same rights on winding up.
Reconciliation of the shares movement in the year
28.02.15 29.02.16
Opening Closing
shares in Shares shares in
issue Creations Cancellations converted issue
‘A’ Net Class (Accumulation shares) 3,986,107 292,580 (804,650) (424,861) 3,049,176
‘A’ Net Class (USD Accumulation shares) 3,946,062 372,705 (264,376) – 4,054,391
‘I’ Net Class (Accumulation shares) 4,092,191 582,488 (221,025) 5,125,076 9,578,730
‘I’ Net Class (USD Accumulation shares) 54,629,831 1,781,654 (26,348,505) – 30,062,980
‘R’ Net Class (Accumulation shares) 37,293 – – – 37,293
‘S’ Net Class (Accumulation shares) 262,689,307 16,847,645 (121,811,624) (65,600,771) 92,124,557
‘S’ Net Class (Income shares) 20,590,024 310,558 (17,147,045) – 3,753,537
17. Risk considerations
Please refer to note 3 of the notes to the fi nancial statements of the company for a detailed description of the risk considerations. There are no further specifi c risks
for this Fund.
The Fund’s currency exposure as at 29 February 2016 was: Currency exposure
Total Total
29.02.16 28.02.15
Currency £’000 £’000
Australian Dollar 4 5,809
Canadian Dollar 6, 510 7,172
Chinese Yuan (Offshore) 4,409 –
Euro 28,934 44,378
Hong Kong Dollar 16,528 34,127
Indian Rupee 1 –
Israeli Shekel 74 –
Japanese Yen 30,847 38,182
Malaysian Ringgit – 3,575
New Zealand Dollar 3 3
Norwegian Krone 1,517 9,746
Singapore Dollar 4 4
South African Rand 5 6
South Korean Won 2,735 4,887
Sterling 18,776 34,293
Swedish Krona – 1
Swiss Franc 9,236 20,969
Taiwan Dollar 5,029 7,710
Thai Baht – 3,049
Turkish Lira 1 1
US Dollar 17 0,273 263,440
Total 29 4,886 477,352
The majority of the Fund’s fi nancial assets are equity shares and other investments which neither pay interest nor have a maturity date. Therefore, the fund’s exposure
to interest rate risk is not considered to be signifi cant.
18. Fair value
29.02.16 28.02.15
Assets Liabilities Assets Liabilities
Valuation technique £’000 £’000 £’000 £’000
Quoted prices for identical instruments in an active market 291, 213 – 464,585 –
29 1,213 – 464,585 –
REPORT AND ACCOUNTS
94 Investec Funds Series iii
Global Equity Fund
Distribution TableFor the year ended 29 February 2016
Final distribution payable 30 April 2016
Group 1 shares purchased before 1 March 2015
Group 2 shares purchased between 1 March 2015 and 29 February 2016
Distribution Distribution
Net payable paid
Income Equalisation 30-Apr-16 30-Apr-15
pence pence pence pence
Share Class A – Accumulation
Group 1 0.4118 – 0.4118 0.2974
Group 2 0.0827 0.3291 0.4118 0.2974
Share Class I – Accumulation
Group 1 17.8823 – 17.8823 15.4886
Group 2 9.5732 8.3091 17.8823 15.4886
Share Class R – Accumulation
Group 1 1.1880 – 1.1880 1.0594
Group 2 1.1880 – 1.1880 1.0594
Share Class S – Accumulation
Group 1 2.3259 – 2.3259 2.0585
Group 2 0.4325 1.8934 2.3259 2.0585
Share Class S – Income
Group 1 2.1021 – 2.1021 1.8864
Group 2 1.4837 0.6184 2.1021 1.8864
Distribution Distribution
Net payable paid
Income Equalisation 30-Apr-16 30-Apr-15
US cent US cent US cent US cent
Share Class A USD – Accumulation
Group 1 0.5749 – 0.5749 0.4719
Group 2 – 0.5749 0.5749 0.4719
Share Class I USD – Accumulation
Group 1 1.1734 – 1.1734 1.1307
Group 2 0.4982 0.6752 1.1734 1.1307
Equalisation
Equalisation applies only to shares purchased during the distribution period (Group 2 shares). It is the average amount of income included in the purchase price of
all Group 2 shares and is refunded to holders of these shares as a return of capital. Being capital, it is not liable to income tax but must be deducted from the cost of
shares for capital gains tax purposes.
REPORT AND ACCOUNTS
Investec Funds Series iii 95
Statement of Total ReturnFor the year ended 29 February 2016
29.02.16 28.02.15
Note £’000 £’000 £’000 £’000
Income
Net capital gains/(losses) 4 5,256 (6,192)
Revenue 6 395 665
Expenses 7 (419) (725)
Interest payable and similar charges 9 – –
Net expenses before taxation (24) (60)
Taxation 8 (39) (72)
Net expenses after taxation (63) (132)
Total return before distributions 5,193 (6,324)
Distribution 9 (36) (61)
Change in net assets attributable to
shareholders from investment activities 5,157 (6,385)
Statement of Change in Net Assets Attributable to ShareholdersFor the year ended 29 February 2016
29.02.16 28.02.15
£’000 £’000 £’000 £’000
Opening net assets attributable to shareholders 43,296 71,850
Amounts receivable on creation of shares 31,005 22,401
Amounts payable on cancellation of shares (16,386) (44,718)
14,619 (22,317)
Dilution adjustment 34 75
Stamp duty reserve tax – (2)
Change in net assets attributable to
shareholders from investment activities 5,157 (6,385)
Retained distribution on accumulation shares 40 75
Closing net assets attributable to shareholders 6 3,146 43,296
Notes to the fi nancial statements are on pages 96 to 99.
Balance SheetAs at 29 February 2016
29.02.16 28.02.15
Note £’000 £’000 £’000 £’000
ASSETS
Investment assets 6 2, 464 42,747
Current assets
Debtors 10 2,96 6 388
Cash and bank balances 11 1,198 333
Total other assets 4, 164 721
Total assets 6 6, 628 43,468
LIABILITIES
Creditors
Other creditors 12 3,482 172
Total liabilities 3,482 172
Net assets attributable to shareholders 6 3,146 43,296
Notes to the fi nancial statements are on pages 96 to 99.
Global Gold Fund
REPORT AND ACCOUNTS
Investec Funds Series iii96
1. Accounting policies
The Accounting policies for the Fund are disclosed in the notes to the fi nancial statements on page 53.
2. Distribution policies
The Distribution policies for the Fund are disclosed in the notes to the fi nancial statements on page 54.
3. Risk management policies
The Risk management policies for the Fund are disclosed in the notes to the fi nancial statements on page 54-57.
4. Net capital gains/(losses)
The net capital gains/(losses) during the year comprise:
29.02.16 28.02.15
£’000 £’000
Non-derivative securities 5, 380 (6,185)
(Losses)/gains on foreign exchange (92) 5
Transaction charges (32) (12)
Net capital gains/(losses) 5,256 (6,192)
5. Purchases, sales and transaction costs
Analysis of total trade costs.
Purchases Sales
29.02.16 28.02.15 29.02.16 28.02.15
£’000 £’000 £’000 £’000
Equities 63,620 26,508 49,399 48,360
Commissions
Equities 48 19 (35) (33)
Taxes
Equities 32 24 (1) –
Total costs 80 43 (36) (33)
Net trades in the year after transaction costs 63,700 26,551 49,363 48,327
Total transaction cost expressed as a percentage of asset type cost.
Purchases Sales
29.02.16 28.02.15 29.02.16 28.02.15
% % % %
Commissions
Equities 0.08 0.07 0.07 0.07
Taxes
Equities 0.05 0.09 0.00 –
Average portfolio dealing spread
The average portfolio dealing spread at the balance sheet was 0.37% (28.02.15: 0.36%).
6. Revenue
29.02.16 28.02.15
£’000 £’000
UK dividends 17 105
Overseas dividends 356 541
Bank interest 2 4
Stocklending income 20 15
Total revenue 395 665
Notes to the Financial StatementsFor the year ended 29 February 2016
REPORT AND ACCOUNTS
Investec Funds Series iii 97
7. Expenses
29.02.16 28.02.15
£’000 £’000
Payable to the ACD or associates of the ACD, and agents of either of them:
ACD fee 385 675
General administration charge (GAC) 29 43
414 718
Payable to the Depositary or associates of the Depositary, and agents of either of them:
Safe custody fee 6 8
6 8
Other expenses:
Stock lending fee 3 2
VAT refund (4) (4)
ADR issuance fees – 1
(1) (1)
Total expenses 419 725
Please refer to the Prospectus for a full description of expenses covered by the GAC.
The audit fee for the year is £8,000 (28.02.15: £8,000).
VAT is currently recovered in respect of certain expenses paid under the GAC.
8. Taxation
a) Analysis of the tax charge in the year:
29.02.16 28.02.15
£’000 £’000
Overseas tax 39 72
Current tax charge (note 8(b)) 39 72
Deferred tax charge (note 8(c)) – –
Total tax charge 39 72
b) Factors affecting current tax charge for the year:
The tax assessed for the year is higher than the standard rate of corporation tax in the UK for an authorised OEIC (20%) (28.02.15: 20%). The differences are
explained below:
29.02.16 28.02.15
£’000 £’000
Net expenses before taxation (24) (60)
Corporation tax of 20% (5) (12)
Effects of:
Revenue not subject to taxation (74) (128)
Movement in excess management expenses 79 140
Overseas tax 39 72
Current tax charge (note 8(a)) 39 72
c) Provision for deferred taxation:
There is no provision required for deferred taxation at the Balance Sheet date in the current or prior year.
d) Factors affecting future tax charge:
The Fund has surplus management expenses that have resulted in an unrecognised deferred asset of £1,952,000 (28.02.15: £1,873,000). This asset has not been
recognised in the fi nancial statements due to the inherent uncertainty of the Fund to generate suffi cient taxable net revenue.
9. Finance costs
Distributions and interest
The Distributions take account of equalisation received on the creation of shares and deducted on the cancellation of shares, and comprises:
29.02.16 28.02.15
£’000 £’000
Final 40 75
40 75
Add: Equalisation deducted on cancellation of shares 24 15
Less: Equalisation received on creation of shares (28) (29)
Finance costs: Distribution 36 61
Finance cost: Interest – –
Total fi nance costs 36 61
REPORT AND ACCOUNTS
Investec Funds Series iii98
Notes to the Financial Statements continuedFor the year ended 29 February 2016
The net distribution for the year is represented by:
29.02.16 28.02.15
£’000 £’000
Net expenses after taxation (63) (132)
Shortfall of income transferred from capital 94 182
Equalisation on conversion shares 5 11
Finance costs: Distribution 36 61
10. Debtors
29.02.16 28.02.15
£’000 £’000
Amounts receivable for creation of shares 2,53 8 350
Sales awaiting settlement 402 34
Accrued dividends and bank interest 26 4
2,96 6 388
11. Cash and bank balances
29.02.16 28.02.15
£’000 £’000
Cash and bank balances 1,198 333
1,198 333
12. Creditors
29.02.16 28.02.15
£’000 £’000
Amounts payable for cancellation of shares – 129
Purchases awaiting settlement 3,428 –
Accrued ACD fee 38 37
Accrued general administration charge 3 3
Accrued safe custody fee 2 1
Accrued transaction charges 11 2
3,482 172
13. Capital commitments and contingent liabilities
The Fund had no contingent liabilities or capital commitments at the year end date. (28.02.15: Nil).
14. Related party transactions
Investec Fund Managers Limited, as Authorised Corporate Director (ACD), is a related party, and acts as a principal in respect of all transactions of shares in the
Company. The aggregate monies received through issues and paid on cancellation of shares are disclosed in the Statement of Change in Shareholders’ Net Assets.
In accordance with the prospectus the ACD collects from the Fund, a general administration charge (GAC), ACD fees and safe custody fees. Please refer to notes 7,
12 and 16 for further details.
Any amounts due to/from Investec Fund Managers Limited at the end of the accounting year are disclosed in notes 10 and 12.
At the year end date nil% of the Fund’s shares (by net asset value) were held by other Funds managed by the ACD (28.02.15: 3.01%).
15. Dilution adjustment
Please refer to note 4 of the notes to the fi nancial statements of the company for a detailed description of dilution adjustment.
16. ACD fees and charges
The different level of ACD fees payable per annum as at 29 February 2016 for each share class is detailed below:
A Shares 1.50%
I Shares 0.75%
R Shares 1.00%
S Shares 0.00%
The GAC is charged at 0.08% of the Net Asset Value of each share class.
All shares within the sub-fund have the same rights on winding up.
REPORT AND ACCOUNTS
Investec Funds Series iii 99
Reconciliation of the shares movement in the year
28.02.15 29.02.16
Opening Closing
shares in Shares shares in
issue Creations Cancellations converted issue
‘A’ Net Class (Accumulation shares) 21,331,207 8,516,900 (6,832,090) (5,109,877) 17,906,14 0
‘A’ Net Class (USD Accumulation shares) 140,370 18,500 (50,316) – 108,554
‘I’ Net Class (Accumulation shares) 22,466,883 28,501,166 (12,797,521) 5,337,946 43,508,47 4
‘R’ Net Class (Accumulation shares) 109,351 – (85,024) – 24,32 7
‘ S’ Net Class (Accumulation shares) 2,050,008 148,137 ( 2,169,512) – 2 8,633
17. Risk considerations
Please refer to note 3 of the notes to the fi nancial statements of the company for a detailed description of the risk considerations. There are no further specifi c risks
for this Fund.
The Fund’s currency exposure as at 29 February 2016 was:
Currency exposure
Total Total
29.02.16 28.02.15
Currency £’000 £’000
Australian Dollar 10,420 1,448
Canadian Dollar 15, 825 16,101
South African Rand 8,4 80 3,373
Sterling 8,8 88 8,217
Turkish Lira 1 1
US Dollar 1 9, 532 14,156
Total 6 3,146 43,296
The majority of the Fund’s fi nancial assets are equity shares and other investments which neither pay interest nor have a maturity date. Therefore, the fund’s exposure
to interest rate risk is not considered to be signifi cant.
18. Effi cient portfolio management techniques risk exposure
The exposure obtained through effi cient portfolio management techniques and identity of counterparties as at 29 February 2016 was as follows:
a) Stock lending
The aggregate value of securities on loan at 29 February 2016 is £nil (28.02.15: £5,457,000). The identities of these counterparties are listed in the counterparties
table below. Securities on loan are included in the portfolio statement and no account is taken of any collateral held. The aggregate value of collateral held at
29 February 2016 is £nil (28.02.15: £5,692,000). This collateral is listed in the collateral held table below.
29.02.16 28.02.15
Value of stock on loan by counterparty £’000 £’000
Citigroup – 320
Credit Suisse – 8
Goldman Sachs – 1,713
JPMorgan – 2
Meryll Lynch, Pierce, Fenner & Smith – 2,017
Morgan Stanley – 710
Scotia Capital – 188
SG Americas Securities – 430
UBS – 69
Total – 5,457
29.02.16 28.02.15
Collateral held £’000 £’000
Cash – 5,692
19. Fair value
29.02.16 28.02.15
Assets Liabilities Assets Liabilities
Valuation technique £000 £000 £000 £000
Quoted prices for identical instruments in an active market 6 2,464 – 42,747 –
REPORT AND ACCOUNTS
Investec Funds Series iii100
Global Gold Fund
Distribution TableFor the year ended 29 February 2016
Final distribution payable 30 April 2016
Group 1 shares purchased before 1 March 2015
Group 2 shares purchased between 1 March 2015 and 29 February 2016
Distribution Distribution
Net payable paid
Income Equalisation 30-Apr-16 30-Apr-15
pence pence pence pence
Share Class A – Accumulation
Group 1 0.0000 – 0.0000 0.0000
Group 2 0.0000 – 0.0000 0.0000
Share Class I – Accumulation
Group 1 0.0907 – 0.0907 0.2438
Group 2 – 0.0907 0.0907 0.2438
Share Class R – Accumulation
Group 1 0.0000 – 0.0000 0.0039
Group 2 0.0000 – 0.0000 0.0039
Share Class S – Accumulation
Group 1 0.7076 – 0.7076 1.0075
Group 2 0.7076 – 0.7076 1.0075
Distribution Distribution
Net payable paid
Income Equalisation 30-Apr-16 30-Apr-15
US cent US cent US cent US cent
Share Class A USD – Accumulation
Group 1 0.0000 – 0.0000 0.0000
Group 2 0.0000 – 0.0000 0.0000
Equalisation
Equalisation applies only to shares purchased during the distribution period (Group 2 shares). It is the average amount of income included in the purchase price of
all Group 2 shares and is refunded to holders of these shares as a return of capital. Being capital, it is not liable to income tax but must be deducted from the cost
of shares for capital gains tax purposes.
REPORT AND ACCOUNTS
Investec Funds Series iii 101
Active management
An active investment approach is one where a portfolio manager aims to beat the market through research, analysis and
his/her judgement. (See also passive management).
Asset allocation
A fund’s allotment to different asset classes.
Asset class
The main types of investment available. The traditional asset classes are equities, bonds and cash.
Bear market
A market where prices fall consistently over a long period of time. Investors are referred to as ‘bearish’ if they believe prices
are going to fall.
Benchmark
A comparative performance index.
Bond
A form of loan issued by a government or company. Typically, an investor should receive a regular coupon and the return of
the principal originally lent when the bond matures. Note: Not all bonds are interest bearing (see zero coupon bond), and not
all bonds are fi xed rate (e.g. index linked, fl oating rate and stepped rate bonds).
Bottom-up investing
An investment approach that concentrates on the analysis of individual companies and considers the company’s history,
management and potential as more important than macroeconomic trends.
Bull market
A market where prices rise consistently over a long period of time. Investors are referred to as ‘bullish’ if they believe prices
are going to rise.
Cash
The most liquid form in which to store capital. While it is regarded as a safe asset class, over time the purchasing power of
cash tends to be eroded by infl ation.
Central bank base rate
The basic rate of interest set by a central bank that determines the cost of borrowing.
Commodities
An asset class which comprises physical assets such as oil, base and precious metals and agricultural produce.
Credit rating agency
An institution that assigns credit ratings to debt issuers, such as companies and governments. Standard & Poor’s and
Moody’s are well-known examples.
Glossary
REPORT AND ACCOUNTS
Investec Funds Series iii102
Credit risk
The risk that a bond issuer or borrower will be unable to meet their contractual obligations.
Credit spread
The differences in yield between ‘risk-free’ bonds, such as gilts or US treasuries, and non-treasury (or gilt) bonds, which are
identical in all respects except for the quality of their rating. Corporate bonds tend to offer additional yield to compensate
investors for the potential risk of default.
Currency risk
The risk of incurring losses of foreign assets due to adverse movements in exchange rates between domestic and foreign
currencies.
Defl ation
As opposed to infl ation, it describes conditions in which there is a widespread, consistent decline in prices. It conveys the
rarer occurrence of the money in one’s pocket actually increasing in buying power, rather than the more usual opposite.
Derivatives
An instrument whose value depends on the performance of an underlying security or rate which requires no initial exchange
of principal. Options, futures and swaps are all examples of derivatives.
Developed markets
Refers to industrialised countries with relatively high levels of economic productivity, high standards of living and stable
economies.
Disinfl ation
Refers to a slowing down in price growth, as opposed to defl ation where prices are already falling.
Diversifi cation
Holding a range of assets to reduce risk.
Dividend
The portion of company net profi ts paid out to shareholders.
Dividend yield
The annual dividend per share divided by the current share price.
Duration
A measure of a bond investment’s sensitivity to changes in interest rates. The longer the duration, the more sensitive it is.
Calculating ‘duration’ for a fi xed income investment such as a bond is a complicated sum. It takes into account the current
value of the bond, the coupon or interest payment, the book cost, and the number of years the bond has left to run. Put
simply, the higher the duration number the higher the potential return (and the greater the risk).
REPORT AND ACCOUNTS
Investec Funds Series iii 103
Emerging markets
Countries in the process of industrialising which tend to have rapidly growing economies.
Emerging market debt
Debt issued by governments and corporates in emerging markets.
Equity
Refers to shares. A share in a company provides an investor with part ownership of that company.
Fixed Income
An investment that provides a return in the form of fi xed periodic payments and the eventual return of principal at maturity.
Future
An obligation to buy or sell an asset on a specifi c date in the future at an agreed price.
Gilt
A bond that is issued by the British government which is generally considered low risk. Bonds issued by South African and
Irish governments are also referred to as gilts.
Hedging
A technique seeking to offset or minimise the exposure to specifi c risk by entering an opposing position.
High yield bond
A below investment grade rated bond, providing the investor with greater returns due to its higher default risk. (See Junk
bond).
Index-linked bonds
Bonds whose coupons and principal payment are linked to movements in infl ation.
Infl ation
Describes conditions in which there have been a consistent rise in prices.
Initial public offering (IPO)
The fi rst public sale of a company’s equity resulting in a quoted stock price on a stock exchange.
Interest
The return earned on funds which have been deposited, loaned, or invested.
Investment grade bonds
Bonds considered of the highest quality by credit rating agencies. The threshold credit rating for Standard & Poor’s is BBB
and Baa3 for Moody’s.
REPORT AND ACCOUNTS
Investec Funds Series iii104
Liabilities
Financial obligations that must be met.
Liquidity
The ease with which an asset can be sold at a reasonable price for cash.
Long dated bond
A bond with usually 15 years or more remaining before redemption, at which point the principal is paid to the holder.
Long-term investment
Holding an asset for an extended period of time. Depending on the security, a long-term asset can be held for as little as one
year or for as long as 30 years.
Macroeconomic
Refers to the big trends in an economy as a whole, such as infl ation and unemployment, while microeconomic forces refer to
the factors affecting individual situations or companies.
Market capitalisation
The total value of a company’s equity, calculated by the number of shares multiplied by their market price.
Maturity
With regards to bonds, maturity refers to the time at which the principal of the bond is repayable and it ceases to exist. In
terms of a pension fund, it conveys the average age of the membership and the time until benefi ts are payable.
Outperformance
The return of a fund in excess of the comparative performance index.
Overweight
When a fund has greater exposure to an asset than the comparative performance index.
Peer group
A group of funds that can be compared with one another for performance purposes. A peer group will usually be based on
the funds’ investment scope, for example UK equities.
Performance
The results of an investment over a given period.
Portfolio
A grouping of fi nancial assets, such as equities, bonds and cash equivalents. Portfolios are held directly by investors and/or
managed by fi nancial professionals.
REPORT AND ACCOUNTS
Investec Funds Series iii 105
Rally
A swift rise.
Real estate
An asset class comprising buildings and land.
Risk premium
The extra return expected by an investor in compensation for holding a risky asset.
Security
A general term for a tradable fi nancial instrument.
Short-term investment
Investments that are held for or mature in 12 months or less.
Standard deviation
A measure of risk, deriving from the historic volatility of a particular asset.
Top-down investing
Contrasting with bottom-up analysis, a top-down approach to investment analysis begins with an assessment of
macroeconomic factors, then business cycles before moving on to look at individual sectors and companies.
Treasuries
Debt securities issued by the US government. Treasuries fall under three categories: treasury bills (T-bills), treasury notes
(T-notes) and treasury bonds (T-bonds).
Underweight
When a fund has less exposure to an asset than the benchmark.
Volatility
Price movements. Standard deviation is a measure of an asset’s historic volatility.
Year-to-date (YTD)
Refers to the period extending from the beginning of the current calendar year to the present date.
Yield
A measure of the income return earned on an investment. In the case of a share the yield expresses the annual dividend
payment as the percentage of the market price of the share. In the case of a property, it is the rental income as a percentage
of the capital value. In the case of a bond the running yield (or fl at or current yield) is the annual interest payable as a
percentage of the current market price. The redemption yield (or yield to maturity) allows for any gain or loss of capital which
will be realised at the maturity date.
REPORT AND ACCOUNTS
Investec Funds Series iii106
Yield curve
A graphical representation off all the yields of bonds of the same quality with maturities ranging from the shortest to the
longest available.
Yield spread
The difference in yield between different bonds.
Yield to maturity
The annualised return (internal rate of return) that would be earned on a bond if held to maturity.
REPORT AND ACCOUNTS
Investec Funds Series iii 107
Other information
ISA status
During the period under review, the shares of the funds met the requirements for eligibility to be held in a stocks and shares
ISA as determined by the regulations which govern ISAs.
Investec Fund Managers Limited offer the ‘A’ shares of the funds through its own ISA plan.
Distributions
Where a distribution is to be paid, it has been calculated as at 29 February 2016 and will be distributed to shareholders,
where applicable, on 30 April 2016. For accumulations shares income distribution payments are deemed to be paid on
30 April 2016.
Telephone calls
Telephone calls may be recorded for training and quality assurance purposes.
Cross holding table
There were no cross holdings between sub-funds in Investec Funds Series iii as at 29 February 2016.
REPORT AND ACCOUNTS
Investec Funds Series iii108
Investec Fund Managers LimitedContact address PO Box 9042, Chelmsford CM99 2XL
Telephone +44 (0)20 7597 1900
Free phone 0800 389 2299
Email [email protected]
Indicator online valuation service
www.investecassetmanagement.com
Registered address Woolgate Exchange
25 Basinghall Street, London EC2V 5HA
Investment AdviserInvestec Asset Management Limited
Woolgate Exchange
25 Basinghall Street
London EC2V 5HA
Registered number for Investec Funds Series iiiIC13 England and Wales
RegistrarInternational Financial Data Services (UK) Limited
IFDS House
St. Nicholas Lane
Basildon
Essex SS15 5FS
DepositaryState Street Trustees Limited
20 Churchill Place
London E14 5HJ
Fund AccountingState Street Bank and Trust Company Limited
20 Churchill Place
London E14 5HJ
Independent AuditorsKPMG LLP
15 Canada Square
Canary Wharf
London E14 5GL
Issued by Investec Fund Managers Limited, April 2016.
Authorised and regulated by the Financial Conduct Authority.
Authorised Corporate Director (ACD)
109Investec Funds Series iii
REPORT AND ACCOUNTS
Chile Peru Switzerland UK
Emerging Markets Local Currency Debt Fund ✓ ✓ ✓ ✓
Global Bond Fund ✓ ✓
Global Dynamic Fund ✓ ✓
Global Equity Fund ✓ ✓
Global Gold Fund ✓ ✓
Notes: Chile and Peru to be distributed to AFPs (Pension Funds) only.
The Company’s Prospectus, Key Investor Information Documents, Instrument of Incorporation, annual and semi-annual reports and accounts may be
obtained, free of charge, from Investec Fund Managers Limited or, in Switzerland, from the Swiss Representative and Paying Agent, RBC Investor Services
Bank S.A., Esch-sur-Alzette, Zurich Branch, Badenerstrasse 567, PO Box 101, CH-8066 Zurich.
A copy of the full portfolio changes during the period under review, is available free of charge from the Swiss Representative.
ACD fees during the year 01/03/15 to 29/02/16.
Effective Commission for Commission for
charge administration, administration
and daily monthly paid according to
calculated to ACD the prospectus
Sub-Fund Class (%) (%) (%)
Emerging Markets Local Currency Debt Fund ‘A’ Class 0.00410959 0.12500000 1.50
Emerging Markets Local Currency Debt Fund ‘I’ Class 0.00205479 0.06250000 0.75
Emerging Markets Local Currency Debt Fund ‘R’ Class 0.00273973 0.08333333 1.00
Emerging Markets Local Currency Debt Fund ‘S’ Class 0.00000000 0.00000000 0.00
Global Bond Fund ‘A’ Class 0.00273973 0.08333333 1.00
Global Bond Fund ‘I’ Class 0.00136986 0.04166667 0.50
Global Bond Fund ‘R’ Class 0.00205479 0.06250000 0.75
Global Bond Fund ‘S’ Class 0.00000000 0.00000000 0.00
Global Dynamic Fund ‘A’ Class 0.00410959 0.12500000 1.50
Global Dynamic Fund ‘B’ Class 0.00136986 0.04166667 0.50
Global Dynamic Fund ‘I’ Class 0.00205479 0.06250000 0.75
Global Dynamic Fund ‘R’ Class 0.00273973 0.08333333 1.00
Global Dynamic Fund ‘S’ Class 0.00000000 0.00000000 0.00
Global Equity Fund ‘A’ Class 0.00410959 0.12500000 1.50
Global Equity Fund ‘I’ Class 0.00205479 0.06250000 0.75
Global Equity Fund ‘R’ Class 0.00273973 0.08333333 1.00
Global Equity Fund ‘S’ Class 0.00000000 0.00000000 0.00
Global Gold Fund ‘A’ Class 0.00410959 0.12500000 1.50
Global Gold Fund ‘I’ Class 0.00205479 0.06250000 0.75
Global Gold Fund ‘R’ Class 0.00273973 0.08333333 1.00
Global Gold Fund ‘S’ Class 0.00000000 0.00000000 0.00
Registration in overseas markets
REPORT AND ACCOUNTS
110 Investec Funds Series iii
Shares start Shares Shares Shares end
Sub-Fund Class of year created redeemed of year
Emerging Markets Local Currency Debt Fund ‘A’ Class (Net Accumulation shares) 23,174,507 243,870 (13,760,018) 9,658,359
Emerging Markets Local Currency Debt Fund ‘A’ Class (Gross Accumulation shares) 63,308,707 5,283,622 (44,738,543) 23,853,786
Emerging Markets Local Currency Debt Fund ‘A’ Class (USD Gross Accumulation shares) 3,840,195 – (2,897,396) 942,799
Emerging Markets Local Currency Debt Fund ‘A’ Class (Net Income–2 shares) 28,023,042 116,675 (18,152,781) 9,986,936
Emerging Markets Local Currency Debt Fund ‘A’ Class (Gross Income–2 shares) 4,750,164 104,533 (1,782,099) 3,072,598
Emerging Markets Local Currency Debt Fund ‘I’ Class (Net Accumulation shares) 49,408,678 18,736,058 (24,041,957) 44,102,779
Emerging Markets Local Currency Debt Fund ‘I’ Class (Gross Accumulation shares) 39,555,100 102,595,777 (83,857,216) 58,293,661
Emerging Markets Local Currency Debt Fund ‘I’ Class (Gross USD Accumulation shares) 277,083,603 10,784,342 (197,411,724) 90,456,221
Emerging Markets Local Currency Debt Fund ‘I’ Class (Net Income–2 shares) 156,744,599 20,287,796 (92,782,556) 84,249,839
Emerging Markets Local Currency Debt Fund ‘I’ Class (Gross Income–2 shares) 6,250 255,035 (18,538) 242,747
Emerging Markets Local Currency Debt Fund ‘R’ Class (Net Accumulation shares) 75,696 217 (13,809) 62,104
Emerging Markets Local Currency Debt Fund ‘R’ Class (Net Income–2 shares) 6,250 405 – 6,655
Emerging Markets Local Currency Debt Fund ‘S’ Class (Gross Accumulation shares) 211,113,316 3,435,609 (148,890,746) 65,658,179
Global Bond Fund ‘A’ Class (Net Accumulation shares) 18,367,208 1,235,708 (3,749,880) 15,853,036
Global Bond Fund ‘A’ Class (Net Income shares) 4,666,984 64,824 (3,398,621) 1,333,187
Global Bond Fund ‘A’ Class (Gross Income shares) 1,301,971 23,110 (491,991) 833,090
Global Bond Fund ‘A’ Class (Net USD Income shares) 347,151 2,383 (310,246) 39,288
Global Bond Fund ‘I’ Class (Net Accumulation shares) 1,761,446 3,486,541 (785,814) 4,462,173
Global Bond Fund ‘I’ Class (Net Income shares) 436,410 233,710 (256,084) 414,036
Global Bond Fund ‘I’ Class (Gross Income shares) 69,985 6,375 (29,514) 46,846
Global Bond Fund ‘R’ Class (Net Accumulation shares) 6,250 8 – 6,258
Global Bond Fund ‘S’ Class (Gross Income shares) 83,082,345 6,642,804 (39,470,678) 50,254,471
Global Dynamic Fund ‘A’ Class (Accumulation shares) 1,101,333 4,029,960 (2,314,437) 2,816,856
Global Dynamic Fund ‘A’ Class (USD Accumulation shares) 795,021 – (48,207) 746,814
Global Dynamic Fund ‘B’ Class (Accumulation shares) 144,886,366 – – 144,886,366
Global Dynamic Fund ‘I’ Class (Accumulation shares) 39,682,042 84,632,833 (22,563,960) 101,750,915
Global Dynamic Fund ‘I’ Class (EUR Accumulation shares) – – 320,119 320,119
Global Dynamic Fund ‘R’ Class (Accumulation shares) 84,225 – – 84,225
Global Dynamic Fund ‘S’ Class (Accumulation shares) 250,933,247 2,599,143 (104,560,665) 148,971,725
Global Equity Fund ‘A’ Class (Accumulation shares) 3,986,107 292,580 (1,229,511) 3,049,176
Global Equity Fund ‘A’ Class (USD Accumulation shares) 3,946,062 372,705 (264,376) 4,054,391
Global Equity Fund ‘I’ Class (Accumulation shares) 4,092,191 5,707,565 (221,026) 9,578,730
Global Equity Fund ‘I’ Class (USD Accumulation shares) 54,629,831 1,781,654 (26,348,505) 30,062,980
Global Equity Fund ‘R’ Class (Accumulation shares) 37,293 – – 37,293
Global Equity Fund ‘S’ Class (Accumulation shares) 262,689,307 16,847,645 (187,412,395) 92,124,557
Global Equity Fund ‘S’ Class (Income shares) 20,590,024 310,558 (17,147,045) 3,753,537
Global Gold Fund ‘A’ Class (Accumulation shares) 21,331,207 8,522,786 (11,947,852) 17,906,141
Global Gold Fund ‘A’ Class (USD Accumulation shares) 140,370 18,500 (50,316) 108,554
Global Gold Fund ‘I’ Class (Accumulation shares) 22,466,883 33,845,293 (12,803,701) 43,508,475
Global Gold Fund ‘R’ Class (Accumulation shares) 109,351 – (85,025) 24,326
Global Gold Fund ‘S’ Class (Accumulation shares) 2,050,008 148,137 (2,169,512) 28,633
Additional Information for Overseas Regulators
111Investec Funds Series iii
REPORT AND ACCOUNTS
01-Mar-15 to Year ended Year ended Year ended
29-Feb-16 31-Dec-15 31-Dec-14 31-Dec-13
% % % %
Emerging Markets Local Currency Debt Fund
‘A’ Acc Net (7.56) (0.02) (21.26) 8.77
‘A’ Acc Gross (6.65) 1.13 (20.23) 10.28
‘A’ Acc Gross USD(6) (7.05) 1.41 (20.63) 10.66
‘A’ Inc-2 Net (7.86) (0.09) (21.24) 8.80
‘A’ Inc-2 Gross (6.65) 1.16 (20.23) 11.98
‘I’ Acc Net (7.03) 0.58 (20.59) 9.66
‘I’ Acc Gross (5.95) 1.86 (19.61) 10.98
‘I’ Acc Gross USD (6.35) 2.16 (20.01) 11.39
‘I’ Inc-2 Net(7) (7.19) 0.66 (20.62) 11.04
‘I’ Inc-2 Gross(4)(7) (4.50) – – –
‘R’ Acc Net(1) (7.23) 0.40 (20.84) –
‘R’ Inc-2 Net(1)(7) (7.43) 1.10 (20.81) –
‘S’ Acc Gross (5.24) 2.65 (19.02) 11.92
JPMorgan GBI-EM Global Diversifi ed TR USD (2.97) 2.11 (18.61) 11.64
Investment Association OE Global Emerging Markets Bond (1.55) 5.04 (13.78) 11.87
Global Bond Fund
‘A’ Acc Net 9.44 4.97 (11.49) 4.31
‘A’ Inc Net 9.43 4.95 (11.50) 4.24
‘A’ Inc Gross 9.65 5.28 (11.19) 4.61
‘A’ Inc Net USD(6) 8.89 5.10 (12.18) 4.54
‘I’ Acc Net 9.86 5.32 (11.07) 4.77
‘I’ Inc Net 9.86 5.39 (11.19) 4.51
‘I’ Inc Gross 10.20 5.81 (10.75) 5.11
‘R’ Acc Net(1) 9.68 5.26 (11.06) –
‘S’ Inc Gross 10.75 6.34 (10.30) 5.66
Barclays Capital Global Aggregate (pre 01/5/11 Citi WGBI) 11.82 5.42 (7.89) 6.05
Investment Association OE Global Bonds 2.46 4.20 (5.71) 9.59
Global Dynamic Fund
‘A’ Acc (3.75) 14.63 10.59 16.04
‘A’ Acc USD(6) (4.17) 14.95 10.22 16.40
‘B’ Acc(3) (2.94) – – –
‘I’ Acc (3.01) 15.50 11.66 16.95
‘I’ Acc EUR(6) (7.48) – – –
‘R’ Acc(1) (3.26) 15.20 11.43 –
‘S’ Acc (2.27) 16.35 12.46 17.82
MSCI AC World NDR (MSCI World NDR Pre 01/01/11) (2.77) 16.63 7.03 15.01
Investment Association OE Global (3.72) 11.71 9.23 12.50
Global Equity Fund
‘A’ Acc (5.66) 14.24 9.88 13.26
‘A’ Acc USD(6) (6.07) 14.56 9.23 13.65
‘I’ Acc (4.94) 15.11 10.71 14.18
‘I’ Acc USD(2)(6) (4.46) 15.92 – –
‘R’ Acc(1) (5.17) 14.78 10.54 –
‘S’ Acc (4.22) 15.98 11.55 15.04
‘S’ Inc (4.21) 16.01 11.51 15.00
MSCI AC World NDR (MSCI World NDR Pre 01/01/11) (2.77) 16.63 7.03 15.01
Investment Association OE Global (3.72) 11.71 9.23 12.50
Global Gold Fund
‘A’ Acc 7.95 (9.92) (30.33) (27.19)
‘A’ Acc USD(6) 7.43 (9.69) (30.70) (27.00)
‘I’ Acc 8.79 (9.25) (29.81) (26.64)
‘R’ Acc(1) 8.55 (9.49) (29.95) –
‘S’ Acc 9.61 (8.57) (29.30) (26.09)
Euromoney Global Gold TR (pre 01/10/14 PR) 8.26 (9.44) (36.69) (29.52)
Source: Lipper, total return, net of UK basic rate tax, no initial charges net of fees in GBP. Index shown for performance comparison purposes only.
Past performance should not be taken as a guide to the future and there is no guarantee that this investment will make profi ts. Returns will vary with market
action, fee levels and taxes, and in certain market conditions losses may be exaggerated.
(1) Launched 2 January 2013.
(2) Launched 30 July 2013.
(3) Launched 30 September 2014.
(4) Launched 5 December 2014.
(5) Launched 7 April 2015.
(6) The indices are shown in GBP.
(7) Share class names charged effective 6 April 2015 (previously ‘Income’ classes).
Fund performance
REPORT AND ACCOUNTS
112 Investec Funds Series iii
29 February
Sub-Fund Class 2016
Emerging Markets Local Currency Debt Fund
‘A’ Acc Net 1.66%
‘A’ Acc Gross 1.66%
‘A’ Acc Gross USD 1.66%
‘A’ Inc-2 Net 1.66%
‘A’ Inc-2 Gross 1.66%
‘I’ Acc Net 0.91%
‘I’ Acc Gross 0.91%
‘I’ Acc Gross USD 0.91%
‘I’ Inc-2 Net 0.91%
‘I’ Inc-2 Gross 0.91%
‘R’ Acc Net 1.16%
‘R’ Inc-2 Net 1.16%
‘S’ Acc Gross 0.16%
Global Bond Fund
‘A’ Acc Net 1.11%
‘A’ Inc Net 1.11%
‘A’ Inc Gross 1.11%
‘A’ Inc Net USD 1.11%
‘I’ Acc Net 0.61%
‘I’ Inc Net 0.61%
‘I’ Inc Gross 0.61%
‘R’ Acc Net 0.86%
Global Dynamic Fund
‘A’ Acc 1.61%
‘A’ Acc USD 1.61%
‘B’ Acc 0.78%
‘I’ Acc 0.86%
‘I’ Acc EUR 0.86%
‘R’ Acc 1.11%
‘S’ Acc 0.11%
Global Equity Fund
‘A’ Acc 1.62%
‘A’ Acc USD 1.62%
‘I’ Acc 0.87%
‘I’ Acc USD 0.87%
‘R’ Acc 1.12%
‘S’ Acc 0.12%
‘S’ Inc 0.12%
Global Gold Fund
‘A’ Acc 1.68%
‘A’ Acc USD 1.68%
‘I’ Acc 0.93%
‘R’ Acc 1.18%
‘S’ Acc 0.18%
Total expense ratios
REPORT AND ACCOUNTS
Investec Funds Series iii 113
The total expense ratio is calculated in accordance with the principles set down by EFAMA, the Pan-European umbrella
organisation of the Investments Funds Industry to comply with the Code of Conduct for the Swiss Funds Industry.
Defi nition of TER
The Total Expense Ratio (TER) represents the relevant annualised operating expenses of each Share Class for the year as a
percentage of the average Net Asset Value of that share class over the same period.
TER = Operating costs
Average NAV
The ratio will be expressed as a percentage to 2 decimal places.
Source of operating cost:
(a) The following list is indicative, but not exhaustive, of the types of expenses included within the TER fi gure:
• fund management fees;
• administration fees;
• trustee or depositary fees;
• custody fees;
• audit fees;
• fund accounting fees;
• valuation fees;
• fees for shareholder services;
• registration fees and regulatory fees;
• legal and advisory fees relating to fund establishment and operation;
• performance fees (if applicable disclosed separately).
(b) The total operating costs do not include:
• transaction costs (including transfer taxes);
• interest on borrowing;
• payments incurred because derivatives;
• fees paid directly by the investors, such as entry/exit fees;
• soft commissions.
Average NAV
The average net assets are calculated using fi gures that are based on the Funds net assets at each calculation point of the
net asset value (NAV).
Total expense ratio (‘TER’) methodology