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FNBT40 - Abridged Audited Results for the Year Ended 30 June 2024
FNB TOP 40 EXCHANGE TRADED FUND (the "Portfolio")
A portfolio in the FNB Funds Collective Investment Scheme in Securities Exchange Traded Funds registered in
terms of the Collective Investment Schemes Control Act, 45 of 2002 ("CISCA")
(Incorporated in the Republic of South Africa)
Share Code: FNBT40
ISIN: ZAE000303129
ABRIDGED AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2024
The FNB Funds Collective Investment Scheme (the "Scheme") was established in accordance with the provisions
of CISCA with effect from 12 April 2008. The Portfolio was established as a portfolio of the Scheme in accordance
with paragraph A of the deed of the Scheme on 12 April 2008.
The Portfolio is a passive investment fund with the aim of providing returns linked to the price and performance of
the FTSE/JSE Top 40 Companies Index (the "Index") on the JSE Limited ("JSE").
The Portfolio was initially listed on the JSE on 15 October 2008.
STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2024
Rand 2024 2023
ASSETS
Investments designated at fair value through profit or loss 2 390 863 887 2 164 037 838
Investments at fair value through profit and loss – securities lent 394 828 004 293 101 847
Trade and other receivables 3 749 254 1 751 170
Cash and cash equivalents 32 725 552 17 860 610
Total assets 2 822 166 697 2 476 751 465
LIABILITIES
Trade and other payables 866 729 783 097
Total liabilities excluding net assets attributable to participatory interest
holders 866 729 783 097
Net assets attributable to participatory interest holders 2 821 299 968 2 475 968 368
Total liabilities including net assets attributable to participatory interest
holders 2 822 166 697 2 476 751 465
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED
30 JUNE 2024
Rand 2024 2023
Restated
Interest income 1 148 741 772 656
Fair value gain 186 690 659 453 197 045
Investment income 187 839 400 453 969 701
Other operating expenses 639 998 417 869
Other income (3 306 473) (3 029 160)
Profit before tax 185 172 925 451 358 410
Taxation - -
Profit before distributions to participatory interest holders 185 172 925 451 358 410
Distributions paid (75 786 936) (85 739 198)
Profit before amounts attributable to participatory interest holders 109 385 989 365 619 212
(Increase) in net assets attributable to participatory interest holders (109 385 989) (365 619 212)
Total comprehensive income for the year - -
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2024
Rand 2024 2023
Cash flows from operating activities
Cash utilised by operations (4 662 466) (3 466 430)
Dividends received 103 491 445 93 639 505
Interest received 1 148 741 772 656
Sales of investments at fair value through profit or loss 529 394 435 1 314 940 229
Purchase of investments at fair value through profit or loss (774 747 427) (1 334 575 593)
Net cash (outflow)/inflow from operating activities (145 375 272) 71 310 367
Cash flows from financing activities
Redemption of portfolio participatory interests (47 630 593) (378 020 101)
Creation of portfolio participatory interests 283 576 204 390 423 185
Distributions paid to participatory interest holders (75 786 936) (85 739 198)
Net cash inflow/(outflow) from financing activities 160 158 675 (73 336 114)
Net increase/(decrease) in cash and cash equivalents 14 783 403 (2 025 747)
Cash and cash equivalents at the beginning of the year 17 744 997 19 770 744
Cash and cash equivalents at the end of the year 32 528 400 17 744 997
SUMMARISED ACCOUNTING POLICIES FOR THE YEAR ENDED 30 JUNE 2024
Basis of presentation
The financial statements have been prepared in accordance with IFRS issued by the International Accounting
Standards Board (IASB), including interpretations issued by the IFRS Interpretations Committee, the Financial
Reporting Pronouncements as issued by the Financial Reporting Standards Council, the South African Institute of
Chartered Accountants ("SAICA") Financial Reporting Guides as issued by the Accounting Practices Committee
and the provisions of CISCA, the JSE Listings Requirements and the Companies Act No. 71 of 2008.
Standards, interpretations and amendments effective 1 July 2023
There were no new or amended IFRS standards which became effective for the year ended 30 June 2024 that
impacted the Portfolio's reported earnings, financial position or reserves, or the accounting policies.
Financial instruments: Classification
The Portfolio has classified all its investments as financial assets or financial liabilities at amortised cost or at fair
value through profit or loss ("FVPL").
Financial assets at amortised cost include trade and other receivables, dividends and interest receivable and cash
and cash equivalents.
Financial assets at FVPL
All financial assets not measured at amortised cost are subsequently measured at FVPL, except for investments
in equities and rights which are mandatorily held at FVPL.
Financial liabilities at amortised cost
Financial liabilities that are not held-for-trading or designated as at FVPL are measured at amortised cost. This
category includes trade and other payables.
Financial instruments: Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, and other short-term highly liquid
investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of
changes in value. All balances, except for physical cash which is held at call, included in cash and cash equivalents
have a maturity date of less than three months from the acquisition date and are measured at amortised cost.
Participatory interest
The Portfolio issues one class of participatory interests which is redeemable at the holder's option. Participatory
interests can be put back to the Portfolio at any dealing date for cash equal to a proportionate share of the Portfolio's
net asset value attributable to the participatory interest class.
The participatory interests are measured at the redemption amount that is payable at the reporting date if the holder
exercises the right to put the participatory interests back to the Portfolio.
The participatory interests are issued and redeemed at the holder's option at prices based on the Portfolio's net
asset value per participatory interest at the time of issue or redemption. The Portfolio's net asset value per
participatory interest is calculated by dividing the net assets attributable to the holders of the participatory interest
by the total number of outstanding participatory interests, in accordance with the provisions of the Portfolio's
supplemental trust deed.
Net assets attributable to participatory interest holders, evidence a residual interest in the assets of a portfolio after
deducting all of its liabilities.
The value of the net assets attributable to participatory interest holders will vary with the changes in the underlying
value of the investments, net of receivables and payables. The total movement in the statement of comprehensive
income is transferred to the net assets attributable to participatory interest holders.
Creations and redemptions are recorded on trade date using the previous day's closing price.
In accordance with the Portfolio's supplemental trust deed, the Portfolio distributes its distributable income and any
other amounts determined by FNB CIS Manco (RF) Proprietary Limited (the "Manager") of the Portfolio to
participatory interest holders. For this reason, the participatory interest does not meet the requirements to be
classified as equity in terms of IAS 32 and is thus classified as a liability. Distributions are automatically reinvested
in additional participatory interests, other than distributions that are paid in cash.
Net income adjustment on creation and redemption of units
An adjustment to income arises on the creation and cancellation of units since the price of a unit includes accrued
income and expenses. The income adjustment on creation or cancellation of units is recognised as part of the
creation or redemption of unit holder interests and disclosed within the note of net assets attributable to participatory
interest holders when units on which it arises are either purchased or sold as these form part of the cash flow on
unit transactions.
Investment income
Fair value gains and losses
Gains and losses arising from a change in the fair value of investments, interest income on interest-bearing
investments and dividend income, are included in the statement of comprehensive income under fair value gains
/ losses in the year in which the changes arise.
Dividend income
Dividend income in respect of investments is recognised when the right to receive payment is established. This is
on the "last-day-to-trade" for listed investments and on the "date-of-declaration" for unlisted investments. Dividend
income is recognised in the statement of comprehensive income as part of fair value gains and losses.
Interest income
Interest income on cash and cash equivalents is recognised in the statement of comprehensive income as part of
interest income on the effective interest method.
Taxation
The Portfolio has no current or deferred tax liability as all realised gains and losses are considered to be of a capital
nature and disregarded in the tax calculation of this Collective Investment Scheme portfolio in accordance with
paragraph 61 of the Eighth schedule to the Income Tax Act No 58 of 1962. All investment income is distributed
within the time frames specified by section 25BA of the Income Tax Act and is therefore taxed in the hands of the
participatory interest holders.
Critical accounting estimates and judgements in applying accounting policies
No significant accounting estimates and judgements have been applied in the annual financial statements of the
Portfolio.
All investments held at FVPL are measured at fair value based on quoted prices in active markets and do not
require the use of judgement or estimates.
SUMMARISED NOTES TO THE ANNUAL FINANCIAL STATEMENTS FOR THE
YEAR ENDED 30 JUNE 2024
Net assets attributable to participatory interest holders
Rand 2024 2023
Restated
Balance at the beginning of the year 2 475 968 368 2 097 946 072
Participatory interests created during the year 283 576 204 390 423 185
Participatory interests redeemed during the year (47 630 593) (378 020 101)
Increase in net assets attributable to participatory interest holders 109 385 989 365 619 212
Balance at the end of the year 2 821 299 968 2 475 968 368
Distributions
Number of Distribution Number of Distribution
participatory participatory
Rand interests interests
2024 2024 2023 2023
Declared 26 July 2023 and paid 31 July 2023
(2023: Declared 27 July 2022 and paid 1 August 2022)
Class A: 47.13 cents per participatory interest
(2023: 57.93 cents per participatory interest) 34 751 770 16 380 181 35 851 693 20 767 986
Declared 25 October 2023 and paid 30 October 2023
(2023: Declared 30 September 2022 and paid 1 October
2022)
Class A: 90.34 cents per participatory interest
(2023: 111.25 cents per participatory interest) 36 051 770 32 568 917 34 751 693 38 660 181
Declared 24 January 2024 and paid 29 January 2024
(2023: Declared 31 December 2022 and paid 2 January
2023)
Class A: 33.67 cents per participatory interest
(2023: 21.90 cents per participatory interest) 36 851 770 12 409 690 34 151 693 7 478 376
Declared 24 April 2024 and paid 29 April 2024
(2023: Declared 31 March 2023 and paid 1 April 2023)
Class A: 38.63 cents per participatory interest
(2023: 55.63 cents per participatory interest) 37 351 770 14 428 148 33 851 770 18 832 655
75 786 936 85 739 198
The Portfolio effects quarterly distributions made out of income received by the Portfolio.
Included in the liability to participatory interest holders is the distribution payable as at 30 June 2024.
Prior year disclosure misstatement
Distribution paid to participatory interest holders was incorrectly classified under the net assets attributable to
participatory interest holders note in the financial statements as a deduction from net assets attributable to
participatory interest holders. Participatory interest does not meet the requirements to be classified as equity in
terms of IAS32 and is thus classified as a liability. Interest, distributions, losses and gains relating to a financial
instrument classified as a liability should be recognized as income or expense in the statement of comprehensive
income. The error has been corrected by restating each of the affected financial statement lines items for the prior
periods. This error did not result in a change to profit before tax, net assets attributable to participatory interest
holders in the statement of financial position, statement of cash flow, related notes and tax as previously reported
in the prior year. The following table summarises the impact on the financial statements:
For the year ended 30 June 2023 Impact of correction of error
As previously
Rand reported Adjustments As restated
Distribution paid - (85 739 198) (85 739 198)
Profit before amounts attributable to participatory interest
holders 451 358 410 (85 739 198) 365 619 212
(Increase) in net assets attributable to participatory interest
holders (451 358 410) 85 739 198 (365 619 212)
Total comprehensive income for the year - - -
These summarised annual financial statements have not been audited by the independent auditors, but the full
sets, available at the website mentioned below, have been audited by the independent auditors, KPMG
Incorporated, and their unqualified audit opinion is available through a secure electronic manner at the election of
the person requesting inspection.
A full copy of the audited annual financial statements, including the audit report issued thereon, is available on the
FNB website: https://www.fnb.co.za/share-investing/exchange-traded-funds.html through the route "ETFs available
to you from FNB - Available ETFs – FNB Top40 ETF – ETF documents – Annual Financial Statements".
10 October 2024
Debt Sponsor
Rand Merchant Bank (a division of FirstRand Bank Limited)
Trustee
Standard Chartered Bank, Johannesburg Branch
Manager
FNB CIS Manco (RF) Proprietary Limited
Auditors
KPMG Incorporated
Date: 10-10-2024 08:00:00
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