2022-04-29-港交所-南方恒指ＥＴＦ_截至二零二一年十二月三十一日止的经审核账目_41页_363kb

CSOP Hang Seng Index ETF Summary

Financial Statements Overview

• Period: From 5 May 2021 (inception) to 31 December 2021.
• Assets: Primarily financial assets at fair value through profit or loss (HK$826,919,250), constituting 99.91% of net assets.
• Net Assets: HK$827,641,761 at year-end, a decrease of HK$58,966,039 due to significant losses.
• Loss: The Sub-Fund incurred a loss of HK$58,966,039, driven by net losses on financial assets and operational expenses.

Key Audit Findings

• Auditor Opinion: Unmodified opinion, giving a true and fair view of financial position and transactions in compliance with HKFRS.
• Key Audit Matter: Focus on the existence and valuation of financial assets at fair value through profit or loss, verified through confirmations and third-party sources.

Management and Operations

• Management Fee: 0.1% of net asset value (lower than the maximum 2%).
• Performance: The Sub-Fund tracked Hang Seng Index underperformance (-16.07% vs. Index’s -16.03%).
• Strategy: Full replication of index constituents, with exceptions permitted via representative sampling or financial derivatives if operational challenges arise.

Risk Assessment

• Market Risk: High exposure to Hong Kong equities, with sensitivity analysis showing that a 10% index fluctuation could impact net assets by HK$82,691,925.
• Credit Risk: Managed via transactions with highly rated counterparties (e.g., Bank of China, rated A+).
• Liquidity: No significant issues due to listed securities and daily monitoring.

Compliance and Disclosures

• Adherence to the SFC Code, with no individual security exceeding 10% of NAV.
• Transactions with related parties (e.g., Bank of China) disclosed, compliant with commercial terms.
• Dividend and withholding tax provisions implemented in line with local tax requirements.