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United ASEAN Income FundAnnual Report

for the financial year ended31st December 2016

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United ASEAN Income Fund(Constituted under a Trust Deed in the Republic of Singapore)

MANAGERUOB Asset Management LtdRegistered Address:80 Raffles PlaceUOB PlazaSingapore 048624Company Registration No. : 198600120Z

OPERATIONS ADDRESS80 Raffles Place#06-00, UOB Plaza 2Singapore 048624Tel: 1800 22 22 228

DIRECTORS OF UOB ASSET MANAGEMENTLee Wai FaiCheo Chai HongGoh Yu MinThio Boon Kiat

TRUSTEE / REGISTRARHSBC Institutional Trust Services (Singapore) Limited21 Collyer Quay#13-02, HSBC BuildingSingapore 049320

CUSTODIANThe Hongkong and Shanghai Banking Corporation Limited1 Queen’s Road CentralHong Kong

AUDITORSPricewaterhouseCoopers LLP8 Cross Street#17-00, PWC BuildingSingapore 048424

SOLICITORS TO THE MANAGERTan Peng Chin LLC30 Raffles Place#11-00, Chevron HouseSingapore 048622

SOLICITORS TO THE TRUSTEEAllen & Gledhill LLPOne Marina Boulevard#28-00Singapore 018989

SUB-MANAGERSUOB Asset Management (Malaysia) Berhad348 Jalan Tun RazakLevel 22, Vista Tower, The Intermark50400 Kuala Lumpur, Malaysia

UOB Asset Management (Thailand) Co., Ltd.173/27-30, 32-33, South Sathorn Road, Thungmahamek, Sathorn25th Floor, Asia Centre BuildingBangkok 10120, Thailand

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A) Fund Performance

Class SGD Distribution

Fund Performance/ Benchmark Returns

3 mth

%Growth

6 mth

%Growth

1 yr

%Growth

3 yrAnn

CompRet

5 yrAnn

CompRet

10 yrAnn

CompRet

SinceInception

15 December 2014Ann

CompRet

United ASeAN Income Fund Class SGD Dist -3.09 -0.33 3.05 N/A N/A N/A -4.46Benchmark -0.52 2.93 8.15 N/A N/A N/A -1.18

Class USD Accumulation


3 mth

%Growth

6 mth

%Growth

1 yr

%Growth

3 yrAnn

CompRet

5 yrAnn

CompRet

10 yrAnn

CompRet

SinceInception

15 December 2014Ann

CompRet

United ASeAN Income Fund Class USD Acc -8.51 -7.07 1.35 N/A N/A N/A -8.78Benchmark -6.11 -4.11 6.20 N/A N/A N/A -5.68

Class USD Distribution


3 mth

%Growth

6 mth

%Growth

1 yr

%Growth

3 yrAnn

CompRet

5 yrAnn

CompRet

10 yrAnn

CompRet

SinceInception

15 December 2014Ann

CompRet

United ASeAN Income Fund Class USD Dist -8.51 -7.07 1.35 N/A N/A N/A -8.78Benchmark -6.11 -4.11 6.20 N/A N/A N/A -5.68

Source: Lipper, a Thomson Reuters Company.

Note: The performance returns of the Fund are in Singapore Dollar and United States Dollar based on a NAV-to-NAV basis with dividends and distributions reinvested, if any.

The benchmark of the Fund: MSCI South East Asia Index.

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For the year ended 31 December 2016, the net asset value of the Fund gained 3.05% compared with a gain of 8.15% in the benchmark MSCI AC South east Asia index in Singapore dollar terms.

The Fund’s underperformance was largely due to stock selection in Thailand. This was partially offset by positive stock selection in Malaysia and Indonesia.

Key contributors to performance included PT Telekomunikasi Indonesia (Indonesia telecommunications), PT Astra International (Indonesia consumer discretionary), Press Metal Bhd (Malaysia Industrials) and PTT (Thailand Energy).

Key detractors included Supermax (Malaysia glove manufacturer), EG Industries (Malaysia Consumer), Unique Engineering & Construction (Thai construction) and Singapore Post (Singapore Industrials).

During the year under review, the Fund added exposure to Singapore as we viewed valuations to be attractive. Headwinds from the oil and gas sector subsided with a rebound in global energy prices after it corrected sharply in the early part of the year. The Fund also raised exposure to Thailand as investor sentiment was boosted following the positive outcome of a referendum. The Fund tactically trimmed positions in the Indonesia as valuations turned unattractive after the outperformance.

As at end December 2016, the Fund had the following country exposure: Singapore (33.0%), Malaysia (18.0%), Indonesia (20.6%), Thailand (17.6%), Philippines (8.6%) and the remainder (2.2%) in cash.

The Fund had the following sector allocation: financials (26.3%), consumer discretionary (8.8%), telecommunication services (9.0%), consumer staples (11.1%), industrials (18.7%) and others (23.9%), with the remainder in cash (2.2%).

Economic and Market Review

equity markets in ASeAN ended 2016 with gains in a volatile year driven by global macro events. ASeAN as a region outperformed Asia but gave up some gains towards the end of the year as emerging markets witnessed a capital shift out to developed markets in the aftermath of the US Presidential election. ASeAN markets were strong in the first half of the year led by recovery in global energy prices lifting the economic outlook for the region. ASeAN markets were caught in the cross-currents of global events with the United Kingdom’s vote in June to leave the european Union (Brexit) raising global risk aversion and market volatility. ASeAN markets lost ground in 4Q16 when Donald Trump won the US Presidential election in a surprise victory that jolted financial markets. The US dollar strengthened against Asian currencies and US bond yields spiked on expectations of global reflation. As anticipated, the US Federal Reserve (Fed) resumed rate hikes in December, raising interest rates by 25 basis points (bps) to 0.75% as economic conditions in the US further improved.

economic indicators generally picked up globally with Asia following in tandem. The Purchasing Managers’ Index (PMI) for China crossed above 50 in the second half of the year after a contractionary period in the first half, and the private sector Caixin manufacturing index ended at 51.9, the highest reading since January 2013. economic growth across ASeAN was sluggish except for Philippines which had a boost from election spending. Inflation remained low, spurring central banks to cut rates in Indonesia, Philippines and Malaysia.

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Performance across the various markets in ASeAN was mixed with markets in Thailand, Indonesia and Singapore gaining in SGD terms. Markets in Philippines and Malaysia underperformed and posted losses.

Thailand was the best performing market, as sentiment and corporate earnings lifted on the back of a rebound in oil prices. even as the country mourned the passing of its longest reigning monarch, confidence returned following a smooth royal succession. Indonesia also outperformed with the successful implementation of tax amnesty sustaining market optimism. Additional tax revenue from newly-declared funds and repatriation of funds kept the currency relatively stable amid volatility in emerging market currencies.

In Singapore, markets were rattled by distress in the oil and gas sector with ramifications on the banking system. Policy makers set a zero per cent appreciation of the Singapore Dollar to accommodate near-term weakness in inflation and growth while adjusting annual GDP growth numbers downward. Malaysia’s continuing saga of its state-linked investment vehicle continued to weigh on investor sentiment. The country’s deteriorating current account position also made Malaysia currency relatively more vulnerable in the face of rising US interest rates. The Philippine market swung into losses in the second half of the year as foreign investors turned cautious in an expensive market, clouded by uncertainty surrounding the economic and foreign policies of newly elected President Rodrigo Duterte.

Across sectors, energy was the best-performing sector while consumer staples, consumer discretionary and financials outperformed. Industrials and healthcare were the worst-performing sectors.

Outlook and Fund Strategy

Against expectations for global reflation and strength in US Dollar, inflation in ASeAN is also expected to rise. Most ASeAN economies are expected to see modest improvement in growth in 2017, while central banks have reached the tail end of the monetary easing cycle. Macro events are likely to dominate ASeAN market performance in 2017, as US Dollar strength is usually a headwind for emerging markets. On a positive note, the ASeAN region has been recipients of rising foreign direct investment from Japan and China. Current expectations of the impact of US President Trump’s trade policies on ASeAN also appear to be overly negative. Valuations have pulled back to close to low on price to book basis.

The Fund has raised Singapore position to overweight as we expect GDP and earnings to post mild recovery in 2017. The challenging conditions in the oil and gas sector seem to have stabilised and this should improve the outlook for the financial sector.

We tactically reduce our exposure in Indonesia on valuation grounds, but believe that the Indonesian economy should recover in 2017 as lower interest rates and the success of the tax amnesty program should accelerate investment spending and improved confidence.

The Fund is overweight in Thailand as a smooth royal succession paves the way for improved confidence and continuation in plans to increase public spending. economic growth and inflation are expected to accelerate in 2017.

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We remain underweight in Malaysia overall, on near-term headwinds from currency weakness on corporate earnings. However a continued recovery in oil prices should bolster the economy and ease pressure on the currency. Policy risks have heightened in the Philippines where we are underweight. While weakening current account position has put pressure on the currency, economic growth and inflation should pick up this year.

ASeAN’s mostly favourable demographic trends and rising incomes underpin the long-term fundamental growth potential of the region, making it an attractive investment destination. We see investment opportunities in various segments relating to consumption and infrastructure spending. The key risks are a disorderly capital outflow, currency volatility and worse-than-expected slowdown in exports.

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B) Investments at fair value and as a percentage of NAV as at 31 December 2016 under review classified by

Fair Value % of NAV(S$)

i) Country

Indonesia 786,931 20.65 Malaysia 686,673 18.01 Philippines 327,184 8.58 Singapore 1,257,492 32.99 Thailand 670,788 17.60

Portfolio of investments 3,729,068 97.83 Other net assets 82,545 2.17

Total 3,811,613 100.00

ii) Industry

Consumer Discretionary 334,801 8.79Consumer Staples 424,257 11.12energy 160,435 4.21Financials 1,003,459 26.32Healthcare 128,961 3.38Industrials 712,840 18.71Information Technology 40,961 1.08Materials 118,507 3.11Real estate 449,782 11.79Telecommunication Services 341,030 8.95Utilities 14,035 0.37


Total 3,811,613 100.00

iii) Asset Class

equities 3,729,068 97.83 Other net assets 82,545 2.17

Total 3,811,613 100.00

iv) Credit rating of debt securities

N/A

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C) Top Ten Holdings

The top 10 holdings as at 31 December 2016 and 31 December 2015

10 largest holdings at 31 December 2016

Fair Value

Percentage oftotal net assetsattributable to

unitholders(S$) %

PT TELKOMUNIKASI INDONESIA 170,715 4.48OVERSEAS-CHINESE BANKING CORPORATION LIMITED 160,560 4.21DBS GROUP HOLDINGS LIMITED 156,060 4.09SINGAPORE TELECOMMUNICATIONS LTD 146,000 3.83PT ASTRA INTERNATIONAL 106,483 2.79UNITED OVERSEAS BANK LTD 104,264 2.74PT BANK NEGARA INDONESIA 94,794 2.49PTT PCL - NVDR 88,545 2.32KIM LOONG RESOURCES BHD 85,552 2.24PT BANK MANDIRI 81,921 2.15

10 largest holdings at 31 December 2015

Fair Value

Percentage oftotal net assetsattributable to

unitholders(S$) %

DBS GROUP HOLDINGS LIMITeD 163,562 4.47SINGAPORe TeLeCOMMUNICATIONS LTD 154,140 4.22UNITeD OVeRSeAS BANK LTD 137,270 3.75PT TeLKOMUNIKASI INDONeSIA 127,817 3.50CAPITALAND LTD 97,150 2.66PT BANK RAKYAT INDONeSIA 94,062 2.57KAWAN FOOD BHD 88,965 2.43OVeRSeAS-CHINeSe BANKING CORPORATION LIMITeD 88,000 2.41RAFFLeS MeDICAL GROUP LTD 83,200 2.28PT BANK NeGARA INDONeSIA 82,165 2.25

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D) Exposure to derivatives

i) fair value of derivative contracts and as a percentage of NAV as at 31 December 2016

N/A

ii) net gains/(losses) on derivative contracts realised during the financial year ended 31 December 2016

N/A

iii) net gains/(losses) on outstanding derivative contracts marked to market as at 31 December 2016

N/A

E) Amount and percentage of net asset value (NAV) invested in other schemes as at 31 December 2016

Fair Value(S$) % of NAV

CAPITALAND COMMeRCIAL TRUST 37,000 0.97CAPITALAND MALL TRUST 30,160 0.79MANULIFe US ReAL eSTATe INVeSTMeNT TRUST 40,524 1.06MAPLeTRee COMMeRCIAL TRUST 14,229 0.37

F) Amount and percentage of borrowings to net asset value (NAV) as at 31 December 2016

N/A

G) Amount of redemptions and subscriptions for the financial year ended 31 December 2016

Total amount of redemptions SGD -Total amount of subscriptions SGD 40,959

H) The amount and terms of related-party transactions for the financial year ended 31 December 2016

Refer to Note 8 of the Notes to the Financial Statements

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I) Expense ratios

31 December 2016 3.21%For the financial period from 15 December 2014 (date of inception) to 31 December 2015 (excluding preliminary expenses) 3.27%For the financial period from 15 December 2014 (date of inception) to 31 December 2015 (including preliminary expenses) 4.85%

Note: The expense ratios have been computed based on the guidelines laid down by the Investment Management Association of Singapore (“IMAS”). The calculation of the expense ratio at 31 December 2016 was based on total operating expenses of $120,804 (2015: $128,251 (excluding prelimininary expenses) / $190,558 (including preliminary expenses)) divided by the average net asset value of $3,766,318 (2015: $3,925,827) for the year. The total operating expenses do not include (where applicable) brokerage and other transactions costs, performance fee, interest expense, distribution paid out to unitholders, foreign exchange gains/losses, front or back end loads arising from the purchase or sale of other funds and tax deducted at source or arising out of income received. The Fund does not pay any performance fee. The average net asset value is based on the daily balances.

J) Turnover ratios

31 December 2016 104.25%For the financial period from 15 December 2014 (date of inception) to 31 December 2015 156.48%

Note: The portfolio turnover ratio is calculated in accordance with the formula stated in the Code on Collective Investment Schemes. The calculation of the portfolio turnover ratio was based on the lower of the total value of purchases or sales of the underlying investments, being sales of $3,926,301 (2015: sales of $6,143,140) divided by the average daily net asset value of $3,766,318 (2015: $3,925,837).

K) Any material information that will adversely impact the valuation of the scheme such as contingent liabilities of open contracts

N/A

L) For schemes which invest more than 30% of their deposited property in another scheme, the following key information on the second-mentioned scheme (“the underlying scheme”)1 should be disclosed as well

i) top 10 holdings at fair value and as percentage of NAV as at 31 December 2016 and 31 December 2015.

N/A

ii) expense ratios for the financial year ended 31 December 2016 and 31 December 2015.

N/A

iii) turnover ratios for the financial year ended 31 December 2016 and 31 December 2015.

N/A

1 where the underlying scheme is managed by a foreign manager which belongs to the same group of companies as, or has a formal arrangement or investment agreement with, the Singapore manager, the above information should be disclosed on the underlying scheme. In other cases, such information on the underlying scheme should be disclosed only if it is readily available to the Singapore manager.

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M) Soft dollar commissions/arrangements

UOB Asset Management has entered into soft dollars arrangements with selected brokers from whom products and services are received from third parties. The products and services relate essentially to computer hardware and software to the extent that they are used to support the investment decision making process, research and advisory services, economic and political analyses, portfolio analyses including performance measurements, market analyses, data and quotation services, all of which are believed to be helpful in the overall discharge of UOB Asset Management’s duties to clients. As such services generally benefit all of UOB Asset Management’s clients in terms of input into the investment decision making process, the soft credits utilised are not allocated on a specific client basis. The Manager confirms that trades were executed on a best execution basis and there was no churning of trades.

UOB Asset Management (Malaysia) Berhad, the Sub-Manager, may accept or receive soft commissions arising from transactions or orders on behalf of a client provided that:

(a) the client’s prior consent has been obtained;

(b) the relevant goods and services are of demonstrable benefit to the client; and

(c) the relevant goods and services are in the form of research and advisory services that assist in the decision-making process relating to the client’s investments.

examples of goods and services that are not considered soft commissions and are prohibited include:

• Travellingcosts

• Accommodationandentertainmentcosts

• Expenditure on hardware that is not incidental in providing the research and advisoryservices

• Membershipfeestoassociations

In addition, the Sub-Manager will take steps to ensure that soft-dollar commissions/arrangements will not include travel, accommodation, entertainment, general administrative goods and services, general office equipment or premises, membership fees, employees’ salaries or direct money payment.

The Sub-Manager will disclose to the client details of any soft commission received as soon as practicable upon accepting or receiving the soft commission, and maintain a register of any soft commission accepted or received. The Sub-Manager has engaged a compliance officer to verify that any soft commission accepted or received by the Sub-Manager complies with the above requirements.

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M) Soft dollar commissions/arrangements (continued)

The Sub-Manager does not retain for its own account any rebates it may receive arising from transactions or orders on behalf of clients. Any rebates received by the Sub-Manager (including without limit any soft commission received in advance by the Sub-Manager) will be directed to the account of the relevant clients.

UOB Asset Management (Thailand) Co., Ltd., the Sub-Manager may enter into soft-dollar commissions/arrangements with a service provider as a result of the Sub-Manager’s use of its services in the management of the Fund, provided that the following conditions shall be followed:

(a) the soft-dollar commissions/arrangements shall be assets having economic value (which do not include travel, accommodation and entertainment), and can reasonably be expected to assist in the management of the Fund as prescribed by applicable laws concerning securities and exchange; and

(b) there shall not be any indication showing that the Sub-Manager has used the services offered by the service provider more often than is necessary in order to benefit the Fund (i.e. churning).

In this connection, the Sub-Manager shall act with fairness and consider the character and types of securities as may be acquired by Fund.

N) Where the scheme offers pre-determined payouts, an explanation on the calculation of the actual payouts received by participants and any significant deviation from the pre-determined payouts

N/A

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REPORT OF THE TRUSTEE

The Trustee is under a duty to take into custody and hold the assets of United ASeAN Income Fund (the “Fund”) in trust for the unitholders. In accordance with the Securities and Futures Act (Cap. 289), its subsidiary legislation and the Code on Collective Investment Schemes, the Trustee shall monitor the activities of the Manager for compliance with the limitations imposed on the investment and borrowing powers as set out in the Trust Deed in each annual accounting year and report thereon to unitholders in an annual report.

To the best knowledge of the Trustee, the Manager has, in all material respects, managed the Fund during the year covered by these financial statements, set out on pages 17 to 41, in accordance with the limitations imposed on the investment and borrowing powers set out in the Trust Deed.

For and on behalf of the TrusteeHSBC INSTITUTIONAL TRUST SeRVICeS (SINGAPORe) LIMITeD

____________________________________Authorised signatory

20 March 2017

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STATEMENT BY THE MANAGER

In the opinion of UOB Asset Management Ltd, the accompanying financial statements set out on pages 17 to 41, comprising the Statement of Total Return, Statement of Financial Position, Statement of Movements of Unitholders’ Funds, Statement of Portfolio and Notes to the Financial Statements are drawn up so as to present fairly, in all material respects, the financial position and the portfolio holdings of United ASeAN Income Fund (the “Fund”) as at 31 December 2016, and the financial performance and movements in unitholders’ funds for the year then ended in accordance with the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore Chartered Accountants. At the date of this statement, there are reasonable grounds to believe that the Fund will be able to meet its financial obligations as and when they materialise.

For and on behalf of the ManagerUOB ASSeT MANAGeMeNT LTD

____________________________________THIO BOON KIATAuthorised signatory

20 March 2017

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INDEPENDENT AUDITOR’S REPORT TO THE UNITHOLDERS OFUNITED ASEAN INCOME FUND(Constituted under a Trust Deed in the Republic of Singapore)

Our Opinion

In our opinion, the accompanying financial statements of the United ASeAN Income Fund (the “Fund”) are properly drawn up in accordance with the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore Chartered Accountants, so as to present fairly, in all material respects, the financial position and portfolio holdings of the Fund as at 31 December 2016, and of the financial performance and movements of unitholders’ funds for the financial year ended on that date.

What we have audited

The financial statements of the Fund comprise:• theStatementofFinancialPositionasat31December2016;• theStatementofPortfolioasat31December2016;• theStatementofTotalReturnforthefinancialyearthenended;• theStatementofMovementsofUnitholders’Fundsforthefinancialyearthenended;and• thenotestothefinancialstatements,includingasummaryofsignificantaccountingpolicies.

Basis for Opinion

We conducted our audit in accordance with Singapore Standards on Auditing (“SSAs”). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Independence

We are independent of the Fund in accordance with the Accounting and Corporate Regulatory Authority Code of Professional Conduct and ethics for Public Accountants and Accounting entities (“ACRA Code”) together with the ethical requirements that are relevant to our audit of the financial statements in Singapore, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ACRA Code.

Other Information

The Fund’s Manager (the “Manager”) is responsible for the other information. The other information comprises the relevant sections of the annual report included in pages 1 to 13, which we obtained prior to the date of this auditor’s report, and excludes the financial statements and our auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and we do not and will not express any form of assurance conclusion thereon.

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Other Information (continued)

In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

If, based on the work we have performed on the other information that we obtained prior to the date of this auditor’s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Manager for the Financial Statements

The Manager is responsible for the preparation and fair presentation of these financial statements in accordance with the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore Chartered Accountants and for such internal control as the Manager determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Manager is responsible for assessing the Fund’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Manager either intends to terminate the Fund or to cease the Fund’s operations, or has no realistic alternative but to do so.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with SSAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

• Identifyandassesstherisksofmaterialmisstatementofthefinancialstatements,whetherdueto fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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Auditor’s Responsibilities for the Audit of the Financial Statements (continued)

• Obtain an understanding of internal control relevant to the audit in order to design auditprocedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control.

• Evaluatetheappropriatenessofaccountingpoliciesusedandthereasonablenessofaccountingestimates and related disclosures made by the Manager.

• Conclude on the appropriateness of the Manager’s use of the going concern basis ofaccounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Fund’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Fund to cease to continue as a going concern.

• Evaluate theoverall presentation, structure and content of the financial statements, includingthe disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with the Manager regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

PricewaterhouseCoopers LLPPublic Accountants and Chartered Accountants

Singapore, 20 March 2017

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STATEMENT OF TOTAL RETURNFor the financial year ended 31 December 2016

2016

For the financial period from 15 December 2014

(date of inception) to 31 December 2015

Note $ $IncomeDividends 117,447 118,666 Interest 2 -

117,449 118,666

Less: ExpensesManagement fee 8 56,621 61,621 Trustee fee 8 5,000 5,233 Audit fee 15,000 15,000 Registrar fee 8 15,000 15,699 Valuation fee 8 4,718 5,135 Custody fee 8 5,005 3,141 Preliminary expenses - 62,307 Transaction cost 52,535 96,167 Other expenses 19,489 28,395

173,368 292,698

Net loss (55,919) (174,032)

Net gains or losses on value of investmentsNet gain/(loss) on investments 180,441 (196,084)Net foreign exchange loss (3,249) (100,151)

177,192 (296,235)

Total return/(deficit) for the year/period before income tax 121,273 (470,267)

Less: Income tax 3 (7,513) (8,216)

Total return/(deficit) for the year/period 113,760 (478,483)

The accompanying notes form an integral part of these financial statements.

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STATEMENT OF FINANCIAL POSITIONAs at 31 December 2016

2016 2015Note $ $

ASSETSPortfolio of investments 3,729,068 3,527,002 Sales awaiting settlement 4,221 18,912 Receivables 4 4,409 5,210 Cash and bank balances 111,494 164,371

Total Assets 3,849,192 3,715,495

LIABILITIESPurchases awaiting settlement - 11,834 Payables 5 37,579 46,767

Total Liabilities 37,579 58,601

EQUITYNet assets attributable to unitholders 6 3,811,613 3,656,894


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STATEMENT OF MOVEMENTS OF UNITHOLDERS’ FUNDSFor the financial year ended 31 December 2016

2016



Note $ $

Net assets attributable to unitholders at the beginning of the financial year/period 3,656,894 -

OperationsChange in net assets attributable to

unitholders resulting from operations 113,760 (478,483)

Unitholders’ contributions/(withdrawals)Creation of units 40,959 4,135,377 Cancellation of units - -

Change in net assets attributable to unitholders resulting from net creation and cancellation of units 40,959 4,135,377

Total increase in net assets attributable to unitholders 154,719 3,656,894

Net assets attributable to unitholders at the end of the financial year/period 6 3,811,613 3,656,894


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STATEMENT OF PORTFOLIOAs at 31 December 2016

Holdings at31 December

2016

Fair value at31 December

2016

Percentage oftotal net assetsattributable to unitholders at31 December

2016$ %

By Geography - PrimaryQuoted Equities

INDONESIAPT ASTRA INTeRNATIONAL 120,000 106,483 2.79 PT BANK CeNTRAL ASIA 23,000 38,229 1.00 PT BANK MANDIRI 66,000 81,921 2.15 PT BANK NeGARA INDONeSIA 160,000 94,794 2.49 PT CIPUTRA DeVeLOPMeNT TBK 260,000 37,221 0.98 PT INDOFOOD CBP SUKSeS MAKMUR TBK 45,000 41,378 1.09 PT KALBe FARMA TBK 200,000 32,492 0.85 PT MATAHARI DePARTMeNT STORe TBK 36,400 59,037 1.55 PT MITRA ADIPeRKASA TBK 80,000 46,325 1.22 PT PeMBANGUNAN PeRUMAHAN PeRSeRO 115,229 47,078 1.23 PT SUMMAReCON AGUNG TBK 220,000 31,258 0.82 PT TeLKOMUNIKASI INDONeSIA 400,000 170,715 4.48

TOTAL INDONESIA 786,931 20.65

MALAYSIABOUSTeAD HOLDINGS BeRHAD 59,220 50,921 1.34 CARLSBeRG BReWeRY MALAYSIA BeRHAD 10,400 46,622 1.22 DUTCH LADY MILK INDUSTRIeS BeRHAD 2,300 41,154 1.08 KeRJAYA PROSPeK GROUP BHD 85,600 59,821 1.57 KIM LOONG ReSOURCeS BHD 77,000 85,552 2.24 LINGKARAN TRANS KOTA HOLDINGS BHD 23,300 44,122 1.16 OLDTOWN BeRHAD 118,000 72,583 1.90 PARAMOUNT CORPORATION BeRHAD 116,500 52,151 1.37 PeCCA GROUP BHD 95,700 49,003 1.29 PROTASCO BeRHAD 100,000 36,391 0.95 SAM eNGINeeRING & eQUIPMeNT (M) BHD 43,000 67,855 1.78 STAR PUBLICATIONS (MALAYSIA) BeRHAD 70,500 50,857 1.33 UNISeM (M) BeRHAD 39,000 29,641 0.78

TOTAL MALAYSIA 686,673 18.01


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2016


2016


2016$ %

By Geography - Primary (continued)Quoted Equities

PHILIPPINESAYALA LAND INC 55,000 51,147 1.34 BDO UNIBANK INC 23,000 74,928 1.97 CeMeX HOLDINGS PHILIPPINeS INC 130,000 41,935 1.10 GT CAPITAL HOLDINGS INC 1,600 59,052 1.55 MeTROPOLITAN BANK & TRUST COMPANY 27,000 56,966 1.49 ROBINSONS ReTAIL HOLDINGS INC 20,000 43,156 1.13

TOTAL PHILIPPINES 327,184 8.58

SINGAPORECAPITALAND COMMeRCIAL TRUST 25,000 37,000 0.97 CAPITALAND MALL TRUST 16,000 30,160 0.79 CITY DeVeLOPMeNT 5,000 41,400 1.09 COMFORTDeLGRO CORP LTD 15,000 37,050 0.97 CWT LIMITeD 30,000 57,900 1.52 DBS GROUP HOLDINGS LIMITeD 9,000 156,060 4.09 GLOBAL LOGISTIC PROPeRTIeS LTD 20,000 44,000 1.15 HeALTH MANAGeMeNT INTeRNATIONAL LIMITeD 50,000 32,000 0.84 JARDINe CYCLe & CARRIAGe LTD 500 20,615 0.54 KePPeL CORPORATION LIMITeD 9,000 52,110 1.37 MANULIFe US ReAL eSTATe INVeSTMeNT TRUST 34,000 40,524 1.06 MAPLeTRee COMMeRCIAL TRUST 10,200 14,229 0.37 OVeRSeAS-CHINeSe BANKING CORPORATION

LIMITeD 18,000 160,560 4.21 RAFFLeS MeDICAL GROUP LIMITeD 40,000 57,200 1.50 SATS LTD 15,600 75,660 1.99 SeMBCORP INDUSTRIeS LTD 8,000 22,800 0.60 SINGAPORe POST LTD 20,000 29,300 0.77 SINGAPORe TeLeCOMMUNICATIONS LTD 40,000 146,000 3.83 ST eNGINeeRING 12,000 38,760 1.02 UNITeD OVeRSeAS BANK LTD 5,111 104,264 2.74 UOL GROUP LIMITeD 10,000 59,900 1.57

TOTAL SINGAPORE 1,257,492 32.99


22




2016


2016


2016$ %


THAILANDADVANCeD INFO SeRVICeS - NVDR 4,100 24,315 0.64 AIRPORTS OF THAILAND PC-NVDR 700 11,240 0.29 ARROW SYNDICATe PCL-NVDR 15,500 10,380 0.27 BANGKOK BANK PUBLIC CO-NVDR 1,900 12,226 0.32 BANGKOK DUSIT MeDICAL SeRVICeS PCL-NVDR 7,800 7,269 0.19 BANGKOK eXPReSSWAY & MeTRO PCL-NVDR 45,100 13,555 0.36 BANPU PCL-NVDR 35,400 27,420 0.72 BCPG PCL-NVDR 685 387 0.01 BeRLI JUCKeR PUBLIC CO-NVDR 14,400 29,192 0.77 CARABAO GROUP PCL-NVDR 6,700 20,610 0.54 CeNTRAL PATTANA PUBLIC CO LTD-NVDR 3,100 7,097 0.19 CHAROeN POKPHAND FOODS PCL-NVDR 6,000 7,141 0.19 CP ALL PCL-NVDR 26,200 66,061 1.73 eLeCTRICITY GeNeRATING PCL-NVDR 1,700 13,648 0.36 INDORAMA VeNTUReS PCL-NVDR 9,200 12,434 0.33 KASIKORNBANK PCL-NVDR 8,300 59,435 1.56 KCe eLeCTRONICS PCL-NVDR 2,300 11,320 0.30 KIATNAKIN BANK PCL-NVDR 1,700 4,046 0.11 KRUNG THAI BANK-NVDR 20,000 14,281 0.37 KRUNGTHAI CARD PCL-NVDR 3,100 17,259 0.45 MINOR INTeRNATIONAL PCL-NVDR 1,720 2,481 0.07 PTT eXPLOR & PROD PCL-NVDR 8,600 33,394 0.88 PTT GLOBAL CHeMICAL PCL-NVDR 10,400 26,433 0.69 PTT PCL - NVDR 5,900 88,545 2.32 PYLON PCL-NVDR 28,500 14,487 0.38 RATCHTHANI LeASING PUBLIC COMPANY LTD-

NVDR 67,800 14,360 0.38 SAHAMITR PReSSURe CONTAINeR PCL-NVDR 15,300 9,691 0.25

Balance carried forward 558,707 14.67


23




2016


2016


2016$ %


THAILAND (continued)Balance brought forward 558,707 14.67SIAM CeMeNT PCL - NVDR 1,400 28,014 0.74 SIAM COMMeRCIAL BANK PCL - NVDR 6,100 37,529 0.98 SINO THAI eNGINeeRING & CONSTRUCTION-

NVDR 12,700 14,218 0.37 SUPALAI PUBLIC COMPANY LIMITeD - NVDR 10,700 10,792 0.28 THAI OIL PCL-NVDR 3,800 11,076 0.29 TISCO FINANCIAL GROUP PCL-NVDR 4,300 10,452 0.27

TOTAL THAILAND 670,788 17.60


Net assets attributable to unitholders 3,811,613 100.00


24



Percentage oftotal net assetsattributable tounitholders at31 December

2016


2015% %

By Geography - Primary (Summary)Quoted Equities

Hong Kong - 0.54 Indonesia 20.65 22.18 Malaysia 18.01 19.19 Philippines 8.58 8.64 Singapore 32.99 30.30 Thailand 17.60 15.60

Portfolio of investments 97.83 96.45 Other net assets 2.17 3.55

Net assets attributable to unitholders 100.00 100.00


25




2016


2016


2015$ % %

By Industry - SecondaryQuoted Equities

Consumer Discretionary 334,801 8.79 8.49 Consumer Staples 424,257 11.12 14.36 energy 160,435 4.21 3.71 Financials 1,003,459 26.32 37.07 Healthcare 128,961 3.38 4.14 Industrials 712,840 18.71 11.51 Information Technology 40,961 1.08 2.27 Materials 118,507 3.11 5.80 Real estate 449,782 11.79 - Telecommunication Services 341,030 8.95 8.28 Utilities 14,035 0.37 0.82

Portfolio of investments 3,729,068 97.83 96.45 Other net assets 82,545 2.17 3.55

Net assets attributable to unitholders 3,811,613 100.00 100.00


26


NOTES TO THE FINANCIAL STATEMENTSFor the financial year ended 31 December 2016

These notes form an integral part of and should be read in conjunction with the accompanying financial statements.

1. General

United ASeAN Income Fund (the “Fund”) is a Singapore-registered trust fund constituted under a Trust Deed dated 21 November 2013 between UOB Asset Management Ltd (the “Manager”) and HSBC Institutional Trust Services (Singapore) Limited (the “Trustee”). The Deed is governed by the laws of the Republic of Singapore. The Fund commenced its operations on 15 December 2014.

The Fund’s investment objective is to achieve a total return consisting of income and capital appreciation through investing primarily in equity and equity-related securities of companies listed on stock exchanges in the Association of Southeast Asian Nations (ASeAN) and listed companies which derive significant revenue or profits from, or have significant assets or any business interests in ASeAN.

Subscriptions and redemptions of the units are denominated in Singapore Dollar and United States Dollar.

The following classes of units have been established:

Class SGD AccClass SGD Dist Class USD Acc Class USD Dist

“Dist” refers to distribution classes which declare and pay distributions in accordance with the applicable distribution policies. “Acc” refers to accumulation classes which do not declare or pay distributions but accumulate investment gains and income in their net asset values.

As at 31 December 2016, the Fund has issued Class SGD Distribution, Class USD Distribution and Class USD Accumulation Units.

2. Significant accounting policies

(a) Basis of preparation

The financial statements have been prepared under the historical cost convention, modified by the revaluation of financial assets at fair value through profit or loss, and in accordance with the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore Chartered Accountants.

27



2. Significant accounting policies (continued)

(b) Recognition of income

Dividend income is recognised when the right to receive payment is established. Interest income is recognised on a time proportion basis using the effective interest method.

(c) Investments

Investments are classified as financial assets at fair value through profit or loss.

(i) Initial recognition

Purchase of investments are recognised on the trade date. Investments are recorded at fair value on initial recognition.

(ii) Subsequent measurement

Investments are subsequently carried at fair value. Net change in fair value on investments are included in the Statement of Total Return in the year in which they arise.

(iii) Derecognition

Investments are derecognised on the trade date of disposal. The resultant realised gains and losses on the sales of investments are computed on the basis of the difference between the weighted average cost and selling price gross of transaction costs, and are taken up in the Statement of Total Return.

(d) Basis of valuation of investments

The fair value of financial assets and liabilities traded in active markets is based on quoted market prices at the close of trading on the reporting date. The quoted market price used for investments held by the Fund is the last traded market price for both financial assets and financial liabilities where the last traded price falls within the bid-ask spread. In circumstances where the last traded price is not within the bid-ask spread, the Manager will determine the point within the bid-ask spread that is most representative of fair value.

(e) Foreign currency translation

(i) Functional and presentation currency

The Fund’s investors are mainly from Singapore with the subscriptions and redemptions of the units denominated in Singapore Dollar and United States Dollar.

The performance of the Fund is measured and reported to the investors in Singapore Dollar. The Manager considers the Singapore Dollar as the currency of the primary economic environment in which the Fund operates. The financial statements are presented in Singapore Dollar, which is the Fund’s functional and presentation currency.

28



2. Significant accounting policies (continued)

(e) Foreign currency translation (continued)

(ii) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Total Return. Translation differences on non-monetary financial assets and liabilities are also recognised in the Statement of Total Return within the net gain or loss on investments.

(f) expenses charged to the Fund

All direct expenses relating to the Fund are charged directly to the Statement of Total Return. In addition, certain expenses shared by all unit trusts managed by the Manager are allocated to each fund based on the respective fund’s net asset value.

(g) Financial derivatives

Financial derivatives including forwards and swaps are entered into for the purposes of efficient portfolio management, tactical asset allocation or specific hedging of financial assets held as determined by the Manager and in accordance with the provision of the Trust Deed and the Code on Collective Investment Schemes.

Financial derivatives outstanding on the reporting date are valued at the forward rate or at the current market prices using the “mark-to-market” method, as applicable, and the resultant gains and losses are taken up in the Statement of Total Return.

(h) Distributions

The Manager has the absolute discretion to determine whether a distribution is to be made. In such an event, an appropriate amount will be transferred to a distribution account, to be paid out on the distribution date. The amount shall not be treated as part of the property of the Fund. Distributions are accrued for at the reporting date if the necessary approvals have been obtained and a legal or constructive obligation has been created.

(i) Preliminary expenses

Preliminary expenses are expensed off in the Statement of Total Return as and when incurred.

29



3. Income tax

2016



$ $

Singapore income tax 712 1,149 Overseas income tax 6,801 7,067

Total income tax 7,513 8,216

The Fund was granted the status of a Designated Unit Trust (“DUT”) in Singapore. The Trustee of the Fund ensures that the Fund fulfills its reporting obligations under the DUT Scheme.

Under the DUT Scheme, certain income of the DUT Fund is not taxable in accordance with Sections 35(12) and 35(12A) of the Income Tax Act. Such income includes:

(i) gains or profits derived from Singapore or elsewhere from the disposal of securities;

(ii) interest (other than interest for which tax has been deducted under Section 45 of the Income Tax Act);

(iii) dividends derived from outside Singapore and received in Singapore;

(iv) gains or profits derived from foreign exchange transactions, transactions in futures contracts, transactions in interest rate or currency forwards, swaps or option contracts and transactions in forwards, swaps or option contracts relating to any securities or financial index;

(v) discount, prepayment fee, redemption premium and break cost from qualifying debt securities issued during the prescribed period; and

(vi) distributions from foreign unit trusts derived from outside Singapore and received in Singapore.

The Singapore income tax represents tax deducted at source for Singapore sourced dividends. The overseas income tax represents tax withheld on foreign sourced income.

30



4. Receivables

2016 2015$ $

Dividend receivable 4,409 5,210

5. Payables

2016 2015$ $

Amount due to Manager 15,734 14,825 Amount due to Trustee 1,246 3,955 Other creditors and accrued expenses 20,599 27,987

37,579 46,767

31



6. Units in issue

During the year ended 31 December 2016 and 2015, the number of units issued, redeemed and outstanding were as follows:

2016Class SGD

DistClass USD

AccClass USD

Dist

Units at the beginning of the year 700,000 2,313,361 305,000 Units created - 34,436 - Units cancelled - - -

Units at the end of the year 700,000 2,347,797 305,000

Net assets attributable to unitholders 638,018 1,944,285 252,583 Net assets attributable to unitholders

(SGD equivalent) 638,018 2,808,714 364,881

Net asset value per unit 0.911 0.828 0.828 Net asset value per unit (SGD equivalent) 0.911 1.196 1.196

For the financial period from 15 December 2014 (date of inception)

to 31 December 2015Class SGD

DistClass USD

AccClass USD

Dist

Units at the beginning of the period - - - Units created 700,000 2,313,361 305,000 Units cancelled - - -

Units at the end of the period 700,000 2,313,361 305,000

Net assets attributable to unitholders 618,806 1,892,074 249,458 Net assets attributable to unitholders

(SGD equivalent) 618,806 2,684,195 353,893

Net asset value per unit 0.884 0.817 0.817 Net asset value per unit (SGD equivalent) 0.884 1.160 1.160

There is no difference between the net assets attributable to unitholders per unit per financial statements and the net assets attributable to unitholders per unit for issuing/redeeming of units.

32



7. Financial risk management

The Fund’s activities expose it to a variety of market risk (including currency risk, interest rate risk and price risk), credit risk and liquidity risk. The Fund’s overall risk management programme seeks to minimise potential adverse effects on the Fund’s financial performance. The Fund may use financial futures contracts, financial options contracts and/or currency forward contracts subject to the terms of the Deeds to moderate certain risk exposures. Specific guidelines on exposures to individual securities and certain industries are in place for the Fund at any time as part of the overall financial risk management to reduce the Fund’s risk exposures.

The Fund’s assets principally consist of financial instruments such as equity investments and cash. They are held in accordance with the published investment policies of the Fund. The allocation of assets between the various types of investments is determined by the Manager to achieve their investment objectives.

(a) Market risk

Market risk is the risk of loss arising from uncertainty concerning movements in market prices and rates, including observable variables such as interest rates, credit spreads, exchange rates, and others that may be only indirectly observable such as volatilities and correlations. Market risk includes such factors as changes in economic environment, consumption pattern and investor’s expectation etc. which may have significant impact on the value of the investments. The Fund’s investments are substantially dependent on changes in market prices. The Fund’s investments are monitored by the Manager on a regular basis so as to assess changes in fundamentals and valuation. Although the Manager makes reasonable efforts in the choice of investments, events beyond reasonable control of the Manager could affect the prices of the underlying investments and hence the asset value of the Fund. Guidelines are set to reduce the Fund’s risk exposures to market volatility such as diversifying the portfolio by investing across various geographies, alternatively, the Fund may be hedged using derivative strategies.

(i) Foreign exchange risk

The Fund has monetary financial assets and liabilities denominated in currencies other than Singapore Dollar and it may be affected favourably or unfavourably by exchange rate regulations or changes in the exchange rates between the Singapore Dollar and such other currencies. The Manager may at his discretion, implement a currency management strategy either to reduce currency volatility or to hedge the currency exposures of the Fund.

33



7. Financial risk management (continued)

(a) Market risk (continued)

(i) Foreign exchange risk (continued)

The table below summarises the Fund’s exposure to foreign currencies as of the end of the financial year.

As at 31 December 2016

SGD PHP MYR THB IDR USD Total $ $ $ $ $ $ $

AssetsPortfolio of

investments 1,216,968 327,184 686,673 670,788 786,931 40,524 3,729,068 Sales awaiting

settlement - - - 4,221 - - 4,221 Receivables 2,720 - 1,512 177 - - 4,409 Cash and bank

balances 42,677 - 14,173 41,528 - 13,116 111,494

Total Assets 1,262,365 327,184 702,358 716,714 786,931 53,640 3,849,192

Liabilities Payables 35,730 - - - - 1,849 37,579

Total Liabilities 35,730 - - - - 1,849 37,579

Net currency exposure 1,226,635 327,184 702,358 716,714 786,931 51,791

34





(i) Foreign exchange risk (continued)

As at 31 December 2015

SGD PHP MYR THB IDR USD Total $ $ $ $ $ $ $

AssetsPortfolio of

investments 1,108,003 315,875 701,830 570,392 811,041 19,861 3,527,002 Sales awaiting

settlement 1 - - 18,911 - - 18,912 Receivables 4,510 61 - 639 - - 5,210 Cash and bank

balances 40,695 - 95,450 21,502 - 6,724 164,371

Total Assets 1,153,209 315,936 797,280 611,444 811,041 26,585 3,715,495

Liabilities Purchases

awaiting settlement - - - 11,834 - - 11,834

Payables 45,483 - - - - 1,284 46,767

Total Liabilities 45,483 - - 11,834 - 1,284 58,601

Net currency exposure 1,107,726 315,936 797,280 599,610 811,041 25,301

Investments, which is a significant item in the Statement of Financial Position, is exposed to currency risk and other price risk. The other price risk sensitivity analysis includes the impact of currency risk on non-monetary investments. The Fund’s net financial assets comprise significantly non-monetary investments, hence currency risk sensitivity analysis has not been performed on the remaining financial assets.

35





(ii) Price risk

Price risk is the risk of potential adverse changes to the value of financial investments because of changes in market conditions and volatility in security prices.

The table below summarises the impact of increases/decreases from the Fund’s underlying investments in equities on the Fund’s net assets attributable to unitholders at 31 December 2016 and 2015. The analysis is based on the assumption that the index components within the benchmark increased/decreased by a reasonable possible shift, with all other variables held constant and that the fair value of the Fund’s investments moved according to the historical correlation with the index.

2016 2015Benchmark component Net impact to

net assets attributable to

unitholders

Net impact tonet assets

attributable tounitholders

$ % $ %

MSCI South east Asia Index 663,774 20 691,292 20

(iii) Interest rate risk

Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates.

Investment funds that invest in equity securities may be subject to interest rate risk as any interest rate change may affect the equity risk premium though at varying degrees. To manage this risk, the Manager analyses how interest rate changes may affect different industries and securities and then seeks to adjust the Fund’s portfolio investments accordingly. However, the effects of changes in interest rates on the Fund’s portfolio may not be quantified as the relationship between the interest rates and the value of equity securities is indirect.

Other than cash and bank balances which are at short-term market interest rates, and therefore are subject to insignificant interest rate risk, the Fund’s financial assets and liabilities are largely non-interest bearing.

Hence, no sensitivity analysis has been presented separately.

36




(b) Liquidity risk

The Fund is exposed to daily cash redemptions and disbursements for the settlements of purchases. The Manager therefore ensures that the Fund maintains sufficient cash and cash equivalents and that it is able to obtain cash from the sale of investments held to meet its liquidity requirements. Reasonable efforts will be taken to invest in securities which are traded in a relatively active market and which can be readily disposed of.

The Fund’s investments in listed securities are considered to be readily realisable as they are listed on established regional stock exchanges.

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

As at 31 December 2016Less than3 months

$

Payables 37,579

As at 31 December 2015Less than3 months

$

Purchases awaiting settlement 11,834 Payables 46,767

(c) Credit risk

The Fund takes on exposure to credit risk, which is the risk that a counterparty will be unable to pay amounts in full when due. The Fund’s credit risk is concentrated on cash and bank balances, and amounts or securities receivable on the sale and purchase of investments respectively. In order to mitigate exposure to credit risk, all transactions in listed securities are settled/paid for upon delivery and transacted with approved counterparties using an approved list of brokers that are regularly assessed and updated by the Manager.

37




(c) Credit risk (continued)

The table below summarises the credit rating of banks and custodians in which the Fund’s assets are held as at 31 December 2016 and 2015.

The credit ratings are based on the Viability ratings published by the rating agency.

As at 31 December 2016Source of

Credit rating credit rating

BankUnited Overseas Bank Limited aa- FitchThe Hongkong and Shanghai Banking Corporation Limited aa- Fitch

CustodianThe Hongkong and Shanghai Banking Corporation Limited aa- Fitch

As at 31 December 2015Source of

Credit rating credit rating

BankUnited Overseas Bank Limited aa- FitchThe Hongkong and Shanghai Banking Corporation Limited aa- Fitch

CustodianThe Hongkong and Shanghai Banking Corporation Limited aa- Fitch

The maximum exposure to credit risk at the reporting date is the carrying amount of the financial assets.

(d) Capital management

The Fund’s capital is represented by the net assets attributable to unitholders. The Fund strives to invest the subscriptions of redeemable participating units in investments that meet the Fund’s investment objectives while maintaining sufficient liquidity to meet unitholder redemptions.

38




(e) Fair value estimation

The Fund classifies fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

• Quotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilities(Level1).• Inputs other thanquotedprices includedwithin Level 1 that are observable for the

asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2).

• Inputs for theassetor liability thatarenotbasedonobservablemarketdata (that is,unobservable inputs) (Level 3).

The following table analyses within the fair value hierarchy the Fund’s financial assets and liabilities (by class) measured at fair value at 31 December 2016 and 2015:

As at 31 December 2016 Level 1 Level 2 Level 3 Total$ $ $ $

AssetsFinancial assets at fair value through profit or loss - Quoted equities 3,729,068 - - 3,729,068

As at 31 December 2015 Level 1 Level 2 Level 3 Total$ $ $ $

AssetsFinancial assets at fair value through profit or loss - Quoted equities 3,526,977 - - 3,526,977 - Quoted derivatives 25 - - 25

3,527,002 - - 3,527,002

Investments whose values are based on quoted market prices in active markets, and therefore classified within Level 1, comprise listed equities. The Fund does not adjust the quoted price for these instruments.

except for cash and bank balances which are classified as Level 1, the Fund’s assets and liabilities not measured at fair value at 31 December 2016 and 2015 have been classified as Level 2. The carrying amounts of these assets and liabilities approximate their fair values as at the reporting date.

39



8. Related party transactions

(a) The Manager and the Trustee of the Fund are UOB Asset Management Ltd and HSBC Institutional Trust Services (Singapore) Limited respectively. UOB Asset Management Ltd is a subsidiary of United Overseas Bank Limited.

Management and valuation fees are paid to the Manager, while trustee fees and registrar fees are paid to HSBC Institutional Trust Services (Singapore) Limited. The custodian of the Fund is The Hongkong and Shanghai Banking Corporation, a related party of the Trustee and to which custody fee is paid. These fees paid or payable by the Fund shown in the Statement of Total Return and in the respective Notes to the Financial Statements are on terms set out in the Trust Deed. All other related party informations are shown elsewhere in the financial statements.

(b) As at the end of the financial year, the Fund maintained the following account with the related parties:

2016 2015$ $

United Overseas Bank LimitedBank balances 4,963 2,387

The Hongkong and Shanghai Banking Corporation LimitedBank balances 106,531 161,984

(c) The following transactions took place during the financial year between the Fund and United Overseas Bank Limited at terms agreed between the parties:

2016



$ $United Overseas Bank LimitedBank charges 50 2

40



8. Related party transactions (continued)

(d) UOB Kay Hian Pte Ltd is an affiliate company of United Overseas Bank Limited.

During the financial year, the Fund has brokerage fee paid or payable to UOB Kay Hian Pte Ltd:

2016



$ $

Brokerage charges 482 149

9. Financial ratios

2016



% %For all classesexpense ratio1 (excluding preliminary expenses) 3.21 3.27 expense ratio1 (including preliminary expenses) 3.21 4.85

Turnover ratio2 104.25 156.48

1 The expense ratios have been computed based on the guidelines laid down by the Investment Management Association of Singapore (“IMAS”). The calculation of the Fund’s expense ratios at 31 December 2016 was based on total operating expenses divided by the average net asset value respectively for the period. The total operating expenses do not include (where applicable) brokerage and other transaction costs, performance fee, interest expense, distribution paid out to unitholders, foreign exchange gains/losses, front or back end loads arising from the purchase or sale of other funds and tax deducted at source or arising out of income received. The Fund does not pay any performance fee. The average net asset value is based on the daily balances.

41



9. Financial ratios (continued)

Total operating expenses and average net asset value as follows:

2016



$ $

Total operating expenses (excluding preliminary expenses) 120,804 128,251

Total operating expenses (including preliminary expenses) 120,804 190,558

Average net asset value 3,766,318 3,925,837

2 The portfolio turnover ratio is calculated in accordance with the formula stated in the Code on Collective Investment Schemes. The calculation of the portfolio turnover ratio was based on the lower of the total value of purchases or sales of the underlying investments divided by the average daily net asset value as follows:

2016



$ $

Purchases/Sales 3,926,301 6,143,140

Average net asset value 3,766,318 3,925,837

10. Comparatives

The comparative figures stated in the statement of total return, statement of movements of unitholders’ funds and related notes are for the financial period from 15 December 2014 (date of inception) to 31 December 2015 and are not directly comparable to the current financial year.

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