AmanahRaya Cash
Management Fund (ARCMF)
THIS INFORMATION MEMORANDUM IS DATED 28TH FEBRUARY 2014.
MANAGER
:
AMANAHRAYA INVESTMENT MANAGEMENT SDN BHD
TRUSTEE
:
CIMB ISLAMIC TRUSTEE BERHAD
INVESTORS ARE ADVISED TO READ AND UNDERSTAND THE CONTENTS OF
THE INFORMATION MEMORANDUM. IF IN DOUBT, PLEASE CONSULT A PROFESSIONAL
ADVISER.
UNITS OF AMANAHRAYA CASH MANAGEMENT FUND CAN ONLY BE SOLD TO QUALIFIED
INVESTORS AS PRESCRIBED UNDER PARAGRAPH 3.02 OF GUIDELINES ON WHOLESALE
FUND.
ABOUT THIS DOCUMENTS
RESPONSIBILITY STATEMENT AND STATEMENT OF DISCLAIMER
This information memorandum has been seen and approved by the Directors of AmanahRaya Investment Management Sdn Bhd and
they collectively and individually accept full responsibility for the accuracy of all information contained herein and confirm, having
made all enquiries which are reasonable in the circumstances, that to the best of their knowledge and belief, there are no other facts
omitted which would make any herein misleading.
Datuk Mohamed Adnan bin Ali (Chairman) (Independent/ Non-Executive)
Meor Khairi bin Meor Mohd Bazid (Managing Director/Chief Executive Officer)
Azhar bin Harun (Independent/ Non-Executive)
Dato’ Haji Che Pee bin Samsudin (Non-Independent/Non-Executive)
Haji Zulkifly bin Sulaiman (Independent/Non-Executive)
Hawariah binti Idris (Non-Independent/Non-Executive)
Investors are advised to note that recourse for false or misleading statements or acts made in connection with the Information
Memorandum is directly available through section 248, 249 and 357 of the Capital Markets and Services Act 2007.
DISCLAIMER
The Securities Commission has approved the issue, offer or invitation in respect of the wholesale fund, the subject of this
information memorandum, and that the approval shall not be taken to indicate that the Securities Commission recommends the
investment.
The Securities Commission will not be liable for any non-disclosure on the part of the AmanahRaya Investment Management Sdn
Bhd and takes no responsibility for the contents of the information memorandum, makes no representation as to its accuracy or
completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from, or in reliance upon the whole or
any part of the content of this information memorandum.
INVESTORS SHOULD RELY ON THEIR OWN EVALUATION TO ASSESS THE MERITS AND RISKS OF THE
INVESTMENT. IN CONSIDERING THE INVESTMENT, INVESTORS WHO ARE IN DOUBT AS THE ACTION TO BE
TAKEN SHOULD CONSULT PROFESSIONAL ADVISERS IMMEDIATELY.
i
TABLE OF CONTENTS
ABOUT THIS DOCUMENTS
i
TABLE OF CONTENTS
ii
GLOSSARY OF TERMS
iii
CORPORATE DIRECTORY
v
1.
KEY DATA INFORMATION
1
2.
FUND DETAILS
4
2.1
GENERAL INFORMATION
4
2.2
FEES AND CHARGES
4
2.3
INVESTMENT STRATEGIES AND POLICIES
6
2.4
VALUATION OF ASSETS
9
3.
SALE AND PURCHASE OF UNITS
10
3.1
PRICING OF UNITS
10
4.
RIGHT AND LIABILITIES OF UNIT HOLDERS
12
4.1
RIGHTS OF UNIT HOLDERS
12
4.2
LIABILITIES OF UNIT HOLDERS
12
4.3
UNCLAIMED MONIES
12
5.
CLIENT COMMUNICATION
13
6.
THE MANAGEMENT COMPANY
14
6.1
THE MANAGER
14
6.2
SUMMARY OF FINANCIAL POSITION OF ARIM
14
6.3
ROLE OF THE MANAGER
15
6.4
THE BOARD OF DIRECTORS
15
6.5
THE INVESTMENT COMMITTEE
15
6.6
PROFILE OF THE KEY MANAGEMENT STAFF OF ARIM
15
6.7
THE INVESTMENT TEAM
17
6.8
CIRCUMSTANCES THAT MAY LEAD TOWARDS THE RETIREMENT, REMOVAL
OR REPLACEMENT OF THE MANAGEMENT COMPANY
17
6.9
POWERS OF THE MANAGER TO REMOVE THE TRUSTEE
17
6.10 POLICY ON CONFLICT OF INTEREST
18
6.11 POLICIES AND PROCEDURES ON ANTI MONEY LAUNDERING
18
6.12 MATERIAL LITIGATIONS
19
7.
THE TRUSTEE
20
7.1.6 KEY MANAGEMENT STAFF
21
7.1.7 DUTIES AND RESPONSIBILITIES OF THE TRUSTEE
22
8.
SALIENT TERMS OF THE DEEDS
23
9.
TAXATION
29
10.
STATEMENT OF CONSENT
34
11.
DOCUMENTS AVAILABLE FOR INSPECTION
35
12.
UNIT TRUST LOAN FINANCING RISK DISCLOSURE STATEMENT
36
13.
DIRECTOR’S DECLARATION
37
ii
GLOSSARY OF TERMS
AmanahRaya
Investment
Management or ARIM or the
Manager
AmanahRaya Investment Management Sdn Bhd (309646-H).
ARB
Amanah Raya Berhad (344986-V).
ARCMF or The Fund
AmanahRaya Cash Management Fund.
Assets of the Fund
A unit trust’s holdings, which may include derivatives securities, cash and
bank deposits, other money market instruments and all amounts due to
the Fund.
BNM
Bank Negara Malaysia.
Business Day(s)
A day on which Bursa Malaysia is open for trading.
Bursa Malaysia
Bursa Malaysia Berhad.
CIMB Islamic Trustee
or Trustee
CIMB Islamic Trustee Berhad (167913-M).
CMSA 2007
Capital Markets and Services Act 2007.
Collecting Points
Any branch, outlet or any premise only as a conduit used to facilitate
purchase and redemption of unit trust funds. Collection Points are not
distribution points for marketing and distribution of unit trusts in
accordance to the Guidelines on Marketing And Distribution of Unit
Trusts issued by SC.
Deed, The Deed
The Deed dated 20th October 2008, First Supplemental Deed dated
6th January 2010 and Second Supplemental Deed dated 15th
February 2012, entered into between the Manager and the Trustee,
agreeing to be bound by the provisions of the Deed.
Financial Institutions
Any locally incorporated institutions that are licensed and regulated
by BNM and/or SC or foreign incorporated institutions that are
regulated by the equivalent regulatory authority abroad.
FIMM
Federation of Investment Managers Malaysia.
Forward Pricing
The Buying/Selling price for units is the NAV per unit of the Fund as at the
next valuation point, after the request for redemption/purchase is received by
the Manager.
Guidelines
Guidelines on Wholesale Funds dated 18th February 2009 issued by
the SC and includes any schedules, appendices and guidelines
contained therein and any amendments or modification made thereto,
from time to time.
Latest Practicable Date (LPD)
As at 31st January 2014, being the latest practicable date for the
purposes of ascertaining certain information contained in this
Information Memorandum.
MARC
Malaysian Rating Corporation Berhad (364803-V)
NAV or Net Asset Value
Net Asset Value of the Fund is determined by deducting the value of
all the Fund’s liabilities from the value of all the Fund’s assets, at the
valuation point. For the purpose of computing the annual management
fee and annual trustee fee, the NAV of the Fund should be inclusive of
iii
the management fee and the trustee fee for the relevant day.
NAV per unit
The Net Asset Value of the Fund divided by the total number of units
in issues.
Person
For the purpose of Unit holder it includes but not limited to a firm, a
body corporate, an unincorporated association, an authority, an
Individual and non-Individual.
Qualified Investors
As per the definition stated in the Guidelines on Wholesale Fund
dated 18th February 2009 issued by the SC.
RAM Ratings
RAM Rating Services Berhad, a subsidiary of RAM Holdings Berhad
(formerly known as Rating Agency Malaysia Berhad).
SC
Securities Commission.
Selling Price
NAV per unit of the Fund and the price at which the Manager sells the
Units to the Unit Holders.
Short Term
A period of less than 3 years.
Special Resolution
A resolution passed at a meeting of Unit Holders duly convened in
accordance with the Deed and carried by a majority of not less than
three-fourths of the Unit Holders voting thereat upon a show of hands of
hands or if a poll is duly demanded and taken by a majority consisting
of not less than three-fourths in number of the votes given on such poll.
The Act
Capital Markets and Service Act 2007 including all amendments
thereto and all regulations, rules and guidelines issued in connection
therewith.
The Fund
Refers to AmanahRaya Cash Management Fund.
The Information
Memorandum or
Info Memo
Information Memorandum for AmanahRaya Cash Management Fund.
UIC
Unit In Circulation refer to total number of units in issue at a point in
time.
Unit holder
The person registered as the holder of a unit or units including persons
jointly registered.
Wholesale Fund
Refers to a unit trust fund, the units of which are issued, offered for
subscription or purchase, or for which invitations to subscribe for or
purchase the units have been made, exclusively to Qualified Investors.
iv
CORPORATE DIRECTORY
The Manager & Investment Manager:
Principal Banker:
AmanahRaya Investment Management Sdn Bhd
Malayan Banking Berhad (3813-K)
No 105, Jalan Bunus, Off Masjid India
50100 Kuala Lumpur
Tel: (03) 2691 1568
Fax: (03) 2691 1768
Business address
Tingkat 7 & 8 Wisma AmanahRaya
No 2 Jalan Ampang
50508 Kuala Lumpur
Tel: (03) 2687 5300
Fax: (03) 2687 5200
Tax Consultant of the Fund:
Ernst & Young Tax Consultants Sdn
Bhd (179793-K)
Level 23A, Menara Milenium, Jalan
Damanlela
Pusat Bandar Damansara
50490 Kuala Lumpur
Tel: (03) 7495 8000
Fax: (03) 2095 5332
Registered address
Tingkat 11 Wisma AmanahRaya
No 2 Jalan Ampang
50508 Kuala Lumpur
Tel: (03) 2055 7388
Fax: (03) 2078 8187
The Trustee:
Board of Directors
Datuk Mohamed Adnan bin Ali (Chairman) *
Meor Khairi bin Meor Mohd Bazid (Managing Director/Chief
Executive Officer)
Dato’ Haji Che Pee bin Samsudin
Azhar bin Harun *
Haji Zulkifly bin Sulaiman *
Hawariah binti Idris
*Independent member
CIMB Islamic Trustee Berhad
(167913-M)
Registered Office
Level 13, Menara CIMB Jalan Stesen
Sentral 2,
Kuala Lumpur Sentral, 50470 Kuala
Lumpur
Malaysia
Tel: (03) 2261 8888
Fax: (03) 2261 0099
Web : http://www.cimb.com
Investment Committee
Datuk Mohamed Adnan bin Ali (Chairman)*
Azhar bin Harun*
Haji Zulkifly bin Sulaiman*
*Independent member
Audit Committee
Datuk Mohamed Adnan bin Ali (Chairman)*
Dato’ Haji Che Pee bin Samsudin
* Independent member
Business Office
Level 21, Menara CIMB Jalan Stesen
Sentral 2, Kuala Lumpur Sentral, 50470
Kuala Lumpur
Malaysia
Tel: (03) 2261 8888
Fax: (03) 2261 9889
Risk Management & Compliance Committee
Azhar bin Harun (Chairman)*
Datuk Mohamed Adnan bin Ali*
*Independent member
Trustee’s Delegate:
CIMB Group Nominees (Tempatan)
Sdn Bhd
(274740-T)
Company Secretary
Norhaslinda Samin (LS8512)
Jerry Jesudian a/l Joseph Alexander (MAICSA 7019735)
Tingkat 11, Wisma AmanahRaya
No 2 Jalan Ampang
50508 Kuala Lumpur
Registered Office
Level 13, Menara CIMB Jalan Stesen
Sentral 2, Kuala Lumpur Sentral, 50470
Kuala Lumpur
Malaysia
Tel: (03) 2261 8888
Fax:(03) 2261 8889
Web: http://www.cimb.com
Business Office
Level 21, Menara CIMB Jalan Stesen
Sentral 2, Kuala Lumpur Sentral, 50470
Kuala Lumpur
v
Malaysia
Tel: (03) 2261 8888
Fax: (03) 2261 9892
vi
1.
KEY DATA INFORMATION
Fund Name
AmanahRaya Cash Management Fund (ARCMF).
Fund Category
Wholesale Money Market Fund.
Fund Type
Income.
Initial Offer Period
(IOP)
1 day.
NAV per unit during
IOP
RM1.0000.
Financial Year End
31st August.
Asset Allocation
The Fund may invest up to 100% in short-term financial instruments with
maturity of not more than 365 days. Up to 10% of the NAV of the Fund may be
invested in short-term Fixed Income Instruments, Money Market Instruments and
Negotiable Instruments with remaining maturity exceeding 365 days but no
longer than 732 days.
Benchmark
Overnight Maybank Rate (obtainable from www.maybank2u.com.my).
Investment Strategy
The Fund shall invest up to 100% of its NAV in a diversified portfolio of good
value short-term financial instruments carrying a minimum credit rating of
AA3/P1 (RAM or equivalent) and Money Market Instruments, including
Negotiable Instruments, Accepted Bills, Commercial P apers and an equivalent
form of deposit with licensed financial institutions.
Investor’s Profile
The Fund is primarily suitable for low risk Qualified I nvestors who are
generally conservative, risk averse and prefer a short-term investment.
Qualified Investors
Qualified Investors are defined by SC’s Guidelines on Wholesale Funds dated 18th
February 2009 as follows :-
(a)
an individual whose total net personal assets exceed RM3 million or its
equivalent in foreign currencies;
(b)
a corporation with total net assets exceeding RM10 million or its equivalent
in foreign currencies based on the last audited accounts;
(c)
a unit trust scheme or prescribed investment scheme;
(d)
a company registered as a trust company under the Trust Companies Act
1949 which has discretion in the investment of trust assets of a trust with
total net assets exceeding RM10 million or its equivalent in foreign
currencies;
(e)
a corporation that is a public company under the Companies Act 1965 or
under the laws of any other country, which has been allowed by the SC to be
a trustee for the purposes of the CMSA and has discretion in the investment
1
of trust assets of a trust with total net assets exceeding RM10 million or its
equivalent in foreign currencies;
(f)
a pension fund approved by the Director General of Inland Revenue under
section 150 of the Income Tax Act 1967;
(g)
a holder of a Capital Markets Services Licence carrying on the business of
dealing in securities;
(h)
any other fund manager;
(i)
a person who acquires securities pursuant to an offer, as principal, if the
aggregate consideration for the acquisition is not less than RM250,000 or its
equivalent in foreign currencies for each acquisition;
(j)
a licensed institution;
(k)
an Islamic bank; and
(l)
an insurance company licensed under the Insurance Act 1996.
Principal Risks of
Investing in the Fund




Market Risk
Credit/ default risk
Interest rate or Price risk
Liquidity risk
Sales Charge (% of
NAV per unit)
Nil.
Other Charges
Any applicable bank charges and other bank fees incurred as a result of
purchasing or withdrawal of units will be borne by the investor.
Switching Fee
At the Manager’s discretion.
Transfer Fee
Not applicable.
Redemption Fee
Nil.
Management Fee
Up to 0.5% per annum of the NAV of the Fund.
Trustee Fee
Up to 0.08% per annum of the NAV of the Fund, subject to a minimum of
RM18,000 per annum.
Fund Expenses
These include audit fee, tax fee and administration expenses.
Minimum Initial
RM100,000
Investment
(to be paid via Telegraphic Transfer – payable to “AmanahRaya Investment
2
Management Sdn Bhd”).
Minimum Units Held
500,000 units.
Minimum Additional
RM1,000
Investment
(to be paid via Telegraphic Transfer – payable to “AmanahRaya Investment
Management Sdn Bhd”).
Frequency and Minimum
Units
Minimum 10,000 units or RM 10,000 whichever is higher.
Redeemed
Redemption Proceeds
Next Business Day after the redemption application is received by the Manager
at or before 10.30a.m. on any Business Day. Any redemption received after
the cut-off time will be considered to be received on the next Business Day, at
the Manager’s discretion.
Switching Facility
At the Manager’s discretion.
Period of Payment of
Switching from Shariah based unit trust funds to conventional funds is
discouraged, especially to Muslim unit holders.
Transfer Facility
Transferred is prohibited.
Distribution Policy
The Fund endeavors to distribute income on a monthly basis by way of
reinvestment in the form of additional units.
The Trustee
CIMB Islamic Trustee Berhad.
THERE ARE FEES AND CHARGES INVOLVED AND INVESTORS ARE ADVISED TO CONSIDER THE
FEES AND CHARGES BEFORE INVESTING IN THE FUND.
UNIT PRICES AND DISTRIBUTION PAYABLE, IF ANY, MAY GO DOWN AS WELL AS UP.
FOR INFORMATION CONCERNING SPECIFIC RISKS WHICH SHOULD BE CONSIDERED BY
PROSPECTIVE INVESTORS, SEE “SPECIFIC RISK” COMMENCING ON PAGE 7.
PAST PERFORMANCE OF THE FUND IS NOT AN INDICATION OF ITS FUTURE PERFORMANCE.
3
2.
FUND DETAILS
2.1
General Information
2.2
Initial Offer Period (IOP)
1 day. Proceeds received from investors will be invested on the following
day.
Initial Offer Price
NAV per unit during Initial Offer Period is RM1.0000
Manager’s Single Pricing
Regime
The single pricing which equates to sales and redemptions quoted and
transacted on a single price (i.e. NAV per unit), offer many advantages to
investors. Under this practice, distribution charge (service charge) are
separately disclosed, therefore it is easier to understand and fairer to
investors as they can see what they are being charged. Such transparency
would also facilitate the investor in comparing the different charges imposed
by various distribution channels and assist investors in making an informed
decision about their choice of investment products as well as the preferred
distribution channel. In addition, with all charges separately stated, investors
are able to clearly gauge or ascertain the performance of their investment.
Minimum Initial Investment
RM100,000 (Ringgit Malaysia One Hundred Thousand only) – to be paid via
Telegraphic Transfer – payable to “AmanahRaya Investment Management
Sdn Bhd”
Minimum Additional
Investment
RM1,000 (Ringgit Malaysia One Thousand only) – to be paid via
Telegraphic Transfer – payable to “AmanahRaya Investment Management
Sdn Bhd”
Minimum Units Held
The minimum units to be held by a Unit Holder in order to remain in the
Fund are 500,000 units.
Fees and Charges
Fees payable by the Investor (directly incurred by the investors when investing in the Fund, unless otherwise stated)
:Sales Charge
Nil
Redemption Fee
No redemption charge levied on the redemption of units for the Fund.
Transfer Fee
Not applicable as transfer from one Unit Holder to another is prohibited for this
Fund.
Switching Fee
Management Fee
Switching from ARCMF to other Funds managed by the Manager may or may not
incur fee.
The Fund pays an annual management fee of up to 0.5% of the NAV to the
4
Manager for managing the Fund. The management fee is calculated on a daily
basis and paid monthly to the Manager.
Illustration:
For example, the NAV of the Fund is RM30 million. Then, the daily accrued
management fee that paid monthly to the Manager is:
Assuming the daily NAV is unchanged at RM30 million, then the daily accrued
management fee is: RM30 million x 0.5% x 1/365 = RM410.96 and Monthly
amount paid to the Manager: RM410.96 X 30 = RM12, 328, 80
Trustee Fee
The Fund pays an annual trustee fee (inclusive of local custodian fee but
excluding foreign sub-custodian fee) of up to 0.08% per annum of the NAV of the
Fund, subject to a minimum fee of RM18,000 per annum. In addition to the
annual trustee fee, which includes the transaction fee, i.e. the fee incurred for
handling purchase/sale of local investments, the Trustee may be reimbursed by
the Fund for any expenses properly incurred by it in the performance of its duties
and responsibilities.
The trustee fee is calculated daily and paid monthly.
Illustration:
Assuming the NAV of the Fund is RM30 million throughout the month, and the
Trustee fee is 0.08% p.a., then the daily accrued trustee fee would be: RM30
million x 0.08% x 1/365 = RM65.75 and
Monthly amount paid to the Trustee: RM65.75 X 30 = RM1, 972.50
Administrative Fee
Only direct fees or costs incurred will be paid out of the Fund. These include the
following:







Commissions/fees paid to brokers/dealers in affecting dealings in the
investments of the Fund;
Tax and other duties charged on the Fund by the Government and other
authorities;
The fee and other expenses properly incurred by the auditor appointed for
the Fund;
Fees for the valuation of any investments of the Fund by independent
valuers for the benefit of the fund;
Cost incurred for the modification of the Deed of the Fund other than those
for the benefit of the Management Company or Trustee;
Cost incurred for any meeting of the Unit Holders other than those convened
by, or for the benefit of, the Management Company or Trustee; and
Other fees/expenses directly related to the Fund.
Expenses related to the issuance of this Info Memo will be borne by the Manager.
There are fees and charges involved and investors are advised to consider the
fees and charges before investing in the Fund.
Policy on Stock Broking
The Manager or any delegate thereof must not retain any rebate from, or
5
Rebates and Soft
Commissions
otherwise share in any commissions with, any broker in consideration for direct
dealings in the investments of the Fund. Accordingly, any rebate or shared
commission should be directed to the account of the Fund concerned.
However, the Manager or any delegate thereof may and intends to retain goods
and services (“soft commissions”) from any broker, only of the goods and
services which are of demonstrable benefit to the Unit Holders such as research
materials and computer software that are incidental to the investment management
activities of the Fund.
Distribution Policy
2.3
The Fund endeavors to distribute income on a monthly basis by way of
reinvestment in the form of additional units. There is no incidental cost associated
with the reinvestment.
Investment Strategies and Policies
Objective
The Fund seeks to provide investors with a regular income stream and high level
of liquidity to meet cash flow requirement while maintaining capital preservation.
Investor’s Profile
The Fund is primarily suitable for low risk Qualified Investors who are generally
conservative, risk averse and prefer a short-term investment.
Asset Allocation
Investment Strategies
and Policies
The Fund may invest up to 100% in short-term financial instruments with
maturity of not more than 365 day. Up to 10% of the NAV of the Fund may be
invested in short-term Fixed Income Instruments, Money Market Instruments and
Negotiable Instruments with remaining maturity exceeding 365 days but no
longer than 732 days.
The Fund shall invest up to 100% of its NAV in a diversified portfolio of good
value short-term financial instruments carrying a minimum credit rating of
AA3/P1 (RAM or its equivalent) and Money Market Instruments, including
Negotiable Instruments, Accepted Bills, Commercial Papers and an equivalent form
of deposit with licensed financial institutions.
In selecting good value financial instruments, the following are the more
important considerations:








issuer’s and/or guarantor’s industry and business medium- to long-term
outlook;
issuer’s and/or guarantor’s financial strength and gearing levels;
issuer’s and/or guarantor’s cash-flow quality and volatility;
issuer’s and/or guarantor’s expected future cash-flow and ability to pay profit
and principal;
issuer’s and/or guarantor’s ratings by RAM or MARC;
duration and interest rate sensitivity;
collateral type and value, and claims priority; and
price and yield-to-maturity.
6
Specific Risks of the
Fund
There are specific risks associated with the Shariah compliant securities/
instruments in which the Fund will invest. These include:
Market Risk
Market risk arises due to fluctuations in market values of investments. Such
fluctuations occur because of factors that affect the entire market. Market risk
cannot be eliminated by diversification. It stems from the fact that there are
economy-wide perils which threaten all businesses. Hence investors will be
exposed to market uncertainties, and no matter how many securities are held,
fluctuations in the economy, political and social environment will affect the
market price of the investments.
Credit/Default Risk
Credit or default risk is a concern for fixed income instruments. The risk arises
when an issuer is unable to service any income payments or pay the principal
amount upon redemption. In such cases, investors may suffer significant capital
losses with respect to their capital invested and income foregone. The
management of credit risk is largely accounted for by the Fund’s management of
issue-specific risk. This refers to the emphasis on credit analysis conducted to
determine issuer’s or guarantor’s ability to service promised payments.
Interest Rate or Price Risk
All fixed income investors are exposed to interest rate risk. Changes in the level of
interest rates will cause demand for sukuk to change inversely. This risk can largely be
eliminated by holding the instruments until maturity, thereby locking in price and
yields. However, whether the Fund will hold any instrument until maturity will depend
on the actual and expected changes in interest rates. The Fund also manages interest
rate risk by considering each instrument’s sensitivity to interest changes as measured
by its duration. When interest rates are expected to increase, the Fund would switch to
instruments with lower duration that are less sensitive to interest rate changes.
Liquidity Risk
Liquidity risk is the risk that the instrument invested in cannot be readily sold and
converted into cash. This can occur when trading volume for the instrument is low
and / or when there is a lack of demand for the instrument. In managing the
liquidity risk, the Fund will employ liquidity or ‘volume traded’ analysis on
primary and secondary markets for all the instrument types. Where applicable, the
Fund will look into the historical volume transacted for the instruments in
question. Thereafter, the appropriate asset allocation can be made for each
security/instrument with regard to reducing liquidity to a comfortable level
in relation to that security/instrument’s risk return profile. Liquidity risk is
managed by the Fund’s credit selection and diversification policies.
7
Risk Management
The Fund has in place a proper risk management structures throughout the entire
investment management process. Various measures include:
(a) Adhering to the Fund’s investment objectives, policies and strategies
the Fund;
of
(b) Undertaking stringent evaluation of movements in market prices and
regularly monitoring, reviewing and reporting to the Investment Committee
to ensure that all the Fund’s investment
objectives are met;
(c)
Employing active and effective asset allocation strategy;
(d)
Employing a stringent screening process by conducting fundamental
analysis of economic, political and social factors to evaluate their
likely effects on the performance of the markets and sectors;
(e) Practicing prudent liquidity management in a timely and cost effective
manner; and
(f) May use financial derivatives for the purposes of hedging only when
deemed appropriate after taking into account the costs of hedging.
Benchmark
Overnight Maybank Rate (obtainable from www.maybank2u.com.my)
Permitted Investments
The Fund may invest in the following investments:
1.
2.
3.
4.
5.
Investment Limits
All securities issued in Malaysia and rated by approved rating agencies such
as Government Investment Issues, Accepted Bills, Bank Negara Negotiable
Notes, Negotiable Instrument of Deposits, Cagamas Bonds and any other
approved Money Market Instruments;
Other obligations issued or guaranteed by the Malaysian Government, Bank
Negara Malaysia, State Governments and Government-related agencies;
Corporate bonds traded in Islamic Money Market and either bank-guaranteed
or carrying a minimum rating at least AA3/P1 rating by RAM, or MARC
equivalent;
Deposits with licensed financial institutions and placements of money at call
with investment banks;
Any other forms of investments, including conventional and Shariah that is
in line with the Fund’s objective.
The restrictions and investment limits for this Fund are as follows:-
1.
The value of a fund’s investments in permitted investments must not be less
than 90% of the fund’s NAV;
2.
The value of a fund’s investments in permitted investments which have a
remaining maturity period of not more than 365days must not be less than
90% of the fund’s NAV;
3.
The value of a fund’s investments in permitted investments which have a
remaining maturity period of more than 365 days but fewer than 732 days
must not exceed 10% of the fund’s NAV;
4.
The value of the fund’s investments in debentures and money market
instruments issued by any single issuer must not exceed 20% of the fund’s
NAV;
5.
The issuer limit in (4) may be increased to 30% if the debentures are rated
by any domestic or global rating agency to be of the best quality and offer
highest safety for timely payment of profit and principal;
8
6.
The value of a fund’s placement in deposits with any single licensed
institution, must not exceed 20% of the fund’s NAV;
7.
The value of the fund’s investments in debentures and money market
instruments issued by any group of companies must not exceed 30% of the
fund’s NAV;
8.
A fund’s investments in debentures must not exceed 20% of the securities
issued by any single issuer; and
9.
A fund’s investments in money market instruments must not exceed 20% of
the instruments issued by any single issuer.
The above limits and restrictions must be complied with at all times based on the
most up-to-date value of the Fund and value of the investments. However, under
the Guidelines, a 5% allowance in excess of any limit or restriction may be
permitted where the limit or restriction is breached through the appreciation or
depreciation of the NAV of the Fund (whether as a result of an appreciation or
depreciation in the value of the investments or as a result of repurchase of units or
payment made from the Fund). The Manager will not make any further
acquisitions to which the relevant limit is breached and the Manager should
within a reasonable period of not more than 3 months from the date of the breach
take all necessary steps and actions to rectify the breach.
2.4
Valuation of Assets
In undertaking any of its investments, the Manager will ensure that all the assets of the Fund will be valued fairly. For
unlisted securities, if reliable quotation exists, market value would be used. In the absence of reliable market
quotation, valuation would be based on the average price obtained from at least 3 independent dealers. The valuation
of these securities will be calculated fortnightly or more frequent when the needs arise. These methods of valuation
are verified by the auditor of the Fund and approved by the Trustee.
Policies on Gearing and
Minimum Liquid Assets
Requirements
The Fund is not permitted to borrow cash or other assets (including the borrowing
of securities within the meaning of the Guidelines on Securities Borrowing and
Lending) in connection with its activities.
Further, the Fund may not assume, guarantee, endorse or otherwise become
directly or contingently liable for or in connection with any obligation or
indebtedness of any person. As this is a wholesale money market fund and highly
liquid, there will be no minimum limit for liquid assets.
9
3.
SALE AND PURCHASE OF UNITS
3.1
Pricing of Units
Computation of NAV
Net Asset Value of the Fund is determined by deducting the value of the Fund’s
liabilities from the value of the Fund’s assets, at the valuation point. For the
purpose of computing the annual management fee and annual trustee fee, the
NAV of the Fund should be inclusive of the management fee and the trustee fee
for the relevant day.
As an illustration, if for example the NAV of the Fund is RM 50,000,000 and the
number of Units in Circulation is 100,000,000, then the
NAV per Unit is:RM 50,000,000
100,000,000
Pricing of Units
= RM 0.5000
The prices of Units of the Fund are determined by using the forward pricing
formula where prices are based on the NAV per Unit of the relevant Fund at the
end of a Business Day after the application for Unit is received by the Manager.
The single pricing which equates to sales and redemptions quoted and transacted
on a single price (i.e. NAV per unit), offer many advantages to investors. Under
this practice, distribution charge (service charge) are separately disclosed,
therefore it is easier to understand and fairer to investors as they can see what they
are being charged. Such transparency would also facilitate the investor in
comparing the different charges imposed by various distribution channels and
assist investors in making an informed decision about their choice of investment
products as well as the preferred distribution channel. In addition, with all charges
separately stated, investors are able to clearly gauge or ascertain the performance
of their investment.
Service Charge
The Manager does not impose a service charge on the purchase of Units of
ARCMF by investors. Units are sold by the Manager at NAV per unit.
The Manager does not impose a repurchase charge on the purchase of units of
ARCMF by the Manager. Units are purchased by the Manager at NAV per unit.
Repurchase Charge
Frequency of Valuation
Valuation of the Fund is carried out at the end of each Business Day. As forward
pricing method is used for this Fund, any request received at or before 10.30a.m.
on any Business Day, the units would be created and/or cancelled based on the
NAV per Unit at the end of that Business Day. Any request received after the cutoff time will be considered to be received on the next Business Day, at the
Manager’s discretion.
Sale of Units
Investors can obtain the Info Memo, account opening form and investment
application form from ARIM’s Office or any authorized agent. The Info Memo is
also available at the Managers website at www.arim.com.my. The Fund
application from can be handed directly to ARIM’s Office, or any authorized
agent or sent by mail, together with a copy of TT Form, cheque or bank draft
made payable to “AmanahRaya Investment Management Sdn Bhd” . If payment
is by cheque and Bank Draft, it must be cross and drawn on a local bank. The
investment of the Fund shall only commenced upon the Bank’s clearance of the
cheque and bank draft.\ Bank charges, where relevant, for outstation cheques will
be borne by the investors. Individual or joint-application must be accompanied by
10
a copy of the applicant’s identity card or passport or other document of
identification. Application by a corporation must be accompanied by a certified
true copy of its Memorandum and Articles of Association. Certificate of
Incorporation, Form 24, Form 44, Form 49 and Board Resolution relating to the
investment, a list of their authorized signatories and their respective specimen
signatures.
Investors are also required to sign off a “Declaration Form” as verification to
indicate that they comply with the requirement referring to “Qualified Investors”
as stated in the Guidelines on Wholesale Fund.
Sale of Units will only be honored upon cheque clearance. If sale of Units is by
way of telegraphic transfer, a bank validated fund transfer form must be presented
as evidence as good for payment.
Redemption of Units
Payment of Redemption
Proceeds
Unit Holders may redeem their investments in the Fund at any point in time by
simply completing the redemption application form and returning it to the
Manager on any Business Day. Redemption must be made in terms of units and
not Ringgit Malaysia (RM) values. The amount to be received by the Unit Holder
for redemption of units will be calculated by multiplying the number of units
redeemed by the NAV of the Fund.
The Manager may repurchase Units utilizing its own fund where Unit Holders
will be paid within the next Business Day from the day the redemption application
is received by the Manager at or before the cut-off time of 10.30a.m. Any
redemption received after the cut-off time will be considered to be received on the
next Business Day, at the Manager’s discretion. Alternatively, the Manager may
request the Trustee to cancel units of the Fund for the purpose of meeting Unit
Holders redemption requests.
There is no restriction on the number of times and units a Unit Holder can
redeem. Nonetheless, the Manager shall not be bound to comply with the request
for partial redemption, if this request resulted in the Unit Holder’s holding being
less than 500,000 units in the Fund.
Transfer Ownership of
Units
Transfer of ownership of investments is not allowed for this Fund.
Switching Facilities
Switching from this Fund into other funds managed by the Manager may be
permitted at the Manager’s discretion. If permitted, Unit Holders of this Fund will
have to redeem the units and acquire the intended fund at the Manager’s
prevailing Selling Price per Unit.
Cut off Time to Purchase
and Redeem
A valid application to purchase or redeem units of the Fund received by ARIM
before 10.30 a.m will be processed using the NAV per unit calculated at the end
of the same Business Day at the Manager’s discretion, any application received
after 10.30 a.m or on a non-Business Day will be processed using the NAV per
unit calculated at the end of the next Business Day.
Any incomplete application will not be processed, pending receipt of all necessary
information.
11
4.
RIGHT AND LIABILITIES OF UNIT HOLDERS
4.1
Rights of Unit Holders
A Unit Holder has the right, among others, to the followings:
(a) To receive the distribution of income, participate in any increase in the value of the units and to other such rights
and privileges as set out under the Deed for the Fund;
(b) To call for Unit Holders meetings, and to vote for the removal of the Trustee or the Manager through a special
resolution; and
(c) To receive annual and interim reports.
However, a Unit Holder would not have the right to require the transfer to the Unit Holder of any of the investments
of the Fund. Neither would a Unit Holder have the right to interfere with or question the exercise by the Trustee or
the Manager on his/her behalf, of the rights of the Trustee as trustee of the investments of the Fund.
4.2
Liabilities of Unit Holders
(a) No Unit Holder is liable for any amount in excess of the purchase price paid for the Units as determined
pursuant to the Deed at the time the Units were purchased;
(b) Unit holders shall not be under any obligation to indemnify the Trustee and/or the Manager in the event that the
liabilities incurred by the Trustee and the Manager in the name of or on behalf of the Fund pursuant to and/or in
the performance of the provisions of the Deed exceed the NAV of the Fund, and any right of indemnity of the
Trustee and/or the Manager shall be limited to recourse to the Fund.
4.3
Unclaimed Monies
Any moneys payable to Unit Holders which remain unclaimed after one year from the date of payment will be
handled by the Manager in accordance with the requirements of the Unclaimed Monies Act, 1965.
Prospective Unit Holders should read and understand the contents of the Information Memorandum and, if
necessary, should consult their adviser(s).
12
5.
CLIENT COMMUNICATION
Unit Holders will/can receive regular updates on the Fund and on their investment through:
(i)
Newspapers
From time to time, Unit Holders will be able to obtain information pertaining to the Fund from the Fund from
the press. The Fund’s daily unit buying and selling prices, the NAV per unit, annual management fee and
sales charge will be quoted in at least 2 major newspapers to enable Unit Holders to monitor their
investments.
(ii)
Financial Reports
The Manager will provide Unit Holders with an annual report within 2 months of the Fund’s financial yearend and quarterly reports within 2 months of the end of the quarterly period covered. A Financial Statement
audited by the Fund’s appointed auditors will be included in the annual report. The Trustee will prepare a
report to Unit Holders in the annual report stating its opinion on the conduct of the Manager, in particular
whether the Manager had managed the Fund in accordance with the limitation on its investment powers as set
out in the Deed and whether the Manager had acted in accordance with the Deed, guidelines on unit trusts,
securities laws and other relevant laws.
(iii)
Statement of Investment
The Manager will issue a statement to Unit Holders confirming the current shareholdings and transactions
relating to their units in the Fund every month.
(iv)
Customer Service
ARIM will be pleased to provide more detailed information on your investments should you require this
service.
Our Customer Service personnel will always be willing to assist you in enquiries on the products, your
investments and other administrative matters.
You can contact our Customer Service personnel through the following:
Telephone
Facsimile
e-mail
:
:
:
(03) 2687 5200 / 5277
(03) 2687 5399
sales@arim.com.my
13
6.
THE MANAGEMENT COMPANY
6.1
The Manager
AmanahRaya Investment Management Sdn Bhd (“ARIM”) is a licensed asset management company under the
Capital Markets and Services Act and a wholly-owned subsidiary of Amanah Raya Berhad. As at 31st December
2013, the authorized and paid-up capital of ARIM stood at RM25 million and RM10 million respectively.
Asset under management as at 31st December 2013 is approximately RM6.847 billion, which makes ARIM one of the
biggest non-bank backed fund management companies in Malaysia. The asset under management covers both Shariah
and non-Shariah mandates. Over the years, ARIM has invested vast resources in building up its infrastructure to
provide a top notch fund management service.
ARIM also has wealth of experience and competency in managing multiple asset classes, for both Ringgit and nonRinggit based investments, which include but not limited to equity, fixed income, unit trust, property, structured
products and private equity.
Currently, ARIM’s list of clients include reputable pension funds, insurance companies, government agencies, nonprofit foundations, public listed companies and high net-worth individuals.
6.2
Summary of Financial Position of ARIM
(in RM)
Unaudited
Audited
Result for twelve
(12) months ended
31st December 2013
Financial Year Ended 31st December
2012
2011
2010
2009
Paid-up capital
10,000,000
10,000,000
10,000,000
10,000,000
10,000,000
Shareholder’s funds
14,694,386
13,390,940
13,219,657
13,299,064
10,763,387
15,725,569
16,789,380
12,537,008
11,430,902
8,544,515
7,140,790
4,000,404
4,043,132
3,142,755
977,267
5,303,447
2,693,308
3,295,593
2,535,677
1,224,594
Turnover
Pre-tax profit/(loss)
After tax profit/(loss)
6.3
Role of The Manager
The Manager is responsible for the investment management and marketing of the Fund; servicing Unit Holders
needs; keeping proper administrative records of Unit Holders and the Fund; ensuring compliance with stringent
internal procedures and guidelines of relevant authorities.
14
6.4
The Board of Directors
There are six (6) members on the Board of Directors of ARIM consisting of three (3) Independent Directors and three
(3) Non-Independent Directors. The Board of Directors oversees the management and operations of ARIM and meets
quarterly.
Role of Directors
The Board of directors is responsible for the overall management of ARIM and its funds. The Board not only ensures
corporate governance is practiced but policies and guidelines are adhered to.
Members of The Board of Directors
Datuk Mohamed Adnan bin Ali (Chairman) (Independent Non-Executive)
Meor Khairi bin Meor Mohd Bazid (Managing Director/Chief Executive Officer)
Azhar bin Harun (Independent/Non-Executive)
Dato’ Haji Che Pee bin Samsudin (Non-Independent/Non-Executive)
Haji Zulkifly bin Sulaiman (Independent/Non-Executive)
Hawariah binti Idris (Non-Independent/Non-Executive)
6.5
The Investment Committee
There are three (3) members on the Investment Committee of ARIM consisting of three (3) Independent Members.
Role of the Investment Committee
The investment committee approves or recommends investment policies and procedures. The committee will
continuously monitor the implementation of the investment policies against the predetermined benchmarks towards
achieving a proper performance of the Fund. The investment committee will meet at least once every quarter or such
other times as may be decided by the Chairman.
Members of the Investment Committee
Datuk Mohamed Adnan bin Ali (Chairman)
Azhar bin Harun
Haji Zulkifly bin Sulaiman
6.6
Profile of the Key Management Staff of ARIM
Meor Khairi Meor Mohd Bazid (Managing Director / Chief Executive Officer)
Meor Khairi Meor Mohd Bazid was appointed to the Board on 27 February 2013. He holds a Bachelor of Business
Administration (Finance) and Master of Business Administration (Finance) from University of Toledo, Ohio, USA.
He was a recipient of Jabatan Perkhidmatan Awam's full scholarships at both undergraduate and graduate levels.
He began his working career as a Corporate Banking Officer at Arab Malaysian Merchant Bank in 1992, which back
then was the biggest merchant bank in the country. In 1993, he joint DR Group Holdings as Assistant Finance
Manager, where he was responsible in overseeing the group's cash flows, investment as well as insurance portfolio.
His career then progressed into fund management industry when he began working as Assistant Portfolio Manager at
SJ Asset Management ("SJAM") in 1995 and was appointed as the Chief Investment Officer of SJAM in 2003.
In April 2008, after almost thirteen years, he left the aforementioned company to join ARIM, first as General
Manager, Equity Research and later as the Chief Investment Officer. Besides overseeing the Research Department, he
is also responsible in formulating the asset allocation and equity strategies. He has more than a decade of experience
in investment in the Asian region. He had done extensive research work and company visits around the region in the
last 13 years. He holds a Capital Markets and Services Representative’s License under the Capital Markets &
Services Act (2007) since 1995. He is familiar with investment product, trading system and risk management
developments.
Mohd Amir Shah Basir (Chief Operating Officer)
Mohd Amir Shah joined Amanah Raya Berhad as an Accountant in year 2004 and was attached to various
Departments including Operations and Accounts and Finance Department. He was entrusted to oversee the Trust and
Estate Accounts and Operations besides managing the Company’s and Group’s Accounts. He joined ARIM in year
15
2008.
Prior to joining Amanah Raya Berhad, he was working at PriceWaterHouseCoopers (“PwC”) for more than 4 years.
During his tenure with PwC, he was attached to the Audit Business Assurance and Advisory Services under the
Financial Industry Group and had been exposed to a wide range of Financial Services areas including Banking,
Insurance, Investment, Asset Management and Unit Trust.
He holds a Master of Business Administration in Finance from Putra University of Malaysia and Bachelor of
Accountancy (Hons) from International Islamic University. He is also a Chartered Accountant and a Certified
Financial Planner.
Rusli Abu Yamin (Head, Marketing & Investment Services)
Rusli Abu Yamin has more than 20 years’ experience in investment management industry. His previous roles have
included responsibility for institutional sales, business retail market, asset management and corporate planning during
his previous stints with Permodalan Nasional Berhad (PNB), Kumpulan Perangsang Selangor, Tabung Amanah
Saham Selangor, HL Securities, JF Apex Securities and ASM Investment Services.
He has an MBA from Ohio University, Athens USA and a Bachelor of Economics (Hons) from Universiti
Kebangsaan Malaysia. He is a holder of a Capital Market & Services Representative License since 2006.
Khadijah Sairah Ibrahim (Head, Sales & Marketing – Unit Trust)
Khadijah Sairah Ibrahim holds an MBA (Finance) with Distinction from University of Malaya, Graduate Diploma in
Applied Finance & Investment from Securities Institute of Australia and a BBA (Transportation) from MARA
University of Technology.
She is a holder of a Capital Markets and Services Representative License (CMSRL) specializing in Fund
Management since 2002 and a Fellow of Financial Services Institute of Australasia (Finsia) since 2005. She has had
vast working experience of more than 15 years in equity research, investment analysis, fund management, unit trust
operations, product development and marketing during her previous tenure with PNB, ASNB and as the Head of
Business Development and Marketing at Meridian Asset Management.
Latifah Idris (Head, Operations & Finance – Unit Trust & Company Account)
Latifah Idris has more than 20 years’ experience in the unit trust industry. She has vast knowledge in the unit trust
and fund management operations, accounting systems and procedures.
She graduated with a Bachelor of Administration majoring in Accounting from Lakehead University, Ontario,
Canada.
Ridza Ahmad Jalaludin (Head, Compliance)- Designated Compliance Officer
Ridza Ahmad Jalaludin joined AmanahRaya Investment Management Sdn Bhd (“ARIM”) in November 2011 and
oversees the compliance functions in both the Fund Management and Unit Trust Management activities. He has with
him 7 years of experience in regulatory monitoring after previous stints at AmanahRaya-JMF Asset Management Sdn
Bhd, AmanahRaya Unit Trust Management Sdn Bhd, AmanahRaya Investment Management Sdn Bhd and Nomura
Islamic Asset Management Sdn Bhd. Currently, he is the designated Compliance Officer and responsible for all
compliance matter at ARIM.
He graduated from the MARA University of Technology (UiTM) with a Bachelor Degree in Corporate
Administration majoring in Company Secretarial. He is also registered as a Compliance Officer with the Securities
Commission.
16
6.7
The Investment Team
(Managing Director/ Chief Executive Officer)
Please refer to Section 6.6 above for details.
Wan Shaharir Johan Haris (Assistant General Manager, Equities)
Wan Shaharir began his career in 2000 as an analyst cum portfolio manager in Permodalan Nasional Berhad. Prior to
joining ARIM he was a portfolio manager with RHB Management Sdn Bhd from 2007 to 2011. Currently he
manages balanced, ethical and shariah mandates for unit trust fund and corporate clients. He holds a Degree in
Business Administration from University of Technology Malaysia (UiTM). He is a holder of a Capital Market &
Services Representative License since 2006.
Jasmine See Yeng Wah (Senior Manager, Credit Evaluation, Fixed Income)
Jasmine holds a Bachelor Degree in Economic (Hons) from University Utara Malaysia, 1997. She joined ARIM in
June 2009 and is currently responsible for credit assessment on fixed income portfolio. She started her career with
AmBank Berhad (formerly known as Arab-Malaysia Bank Berhad) in 1997. She joined OSK investment Bank in
2006 and later in 2007, moved to RHB Bank Berhad.
Jasmine has extensive exposure in banking industry, particularly in credit assessment in various market segments
besides hands on experience in loan documentation, and loan recovery. She is a certified credit professional who has
been conferred Certified Credit Professional (CCP); a qualification endorsed by the Bank Negara Malaysia.
6.8
Circumstances That May Lead Towards The Retirement, Removal or Replacement of The
Management Company
The Management Company may retire upon giving 12 months’ notice (or such shorter period as the Manager and
Trustee may agree) to the Trustee of its desire to do so, and may by deed appoint in its stead a new Management
Company approved by the Trustee and the SC.
The Management Company shall also retire, if so required by the Trustee, on the grounds that:
6.9

a special Resolution to that effect has been passed by the Unit Holders at a meeting called for that purpose;

the Manager has failed or neglected to carry out its duties to the satisfaction of the Trustee and Trustee
considers that it would be in the interests of Unit Holders for it to do so after the Trustee has given Notice to
it of that opinion and the reason for that opinion, and after consultation with the relevant authorities and with
the approval of Unit Holders;

the Manager has gone into liquidation, except for the purpose of amalgamation or reconstruction or some
similar purpose, or has had a receiver appointed or has ceased to carry on business.
Powers of The Manager to Remove The Trustee
The Trustee may retire upon giving twelve (12) months’ notice to the Manager of its desire to do so, or such shorter
period as the Manager and the Trustee may agree, and may by deed appoint in its stead a new Trustee approved by the
Securities Commission.
The Trustee may be removed and another Trustee may be appointed by special resolution of the Unit Holders at a
Unit Holders’ meeting convened in accordance with the Deed.
A management company shall take all reasonable steps to replace a Trustee as soon as practicable after becoming
aware that:
(i)
The Trustee has ceased to exist;
(ii)
The Trustee has not been validly appointed;
17
(iii)
The Trustee is not eligible to be appointed or to act as Trustee under Section 290 of CMSA 2007;
(iv)
The Trustee has failed or refused to act as Trustee in accordance with the provisions or covenants of the Deed
or the provisions of CMSA 2007;
(v)
A receiver is appointed over the whole or a substantial part of the assets or undertaking of the existing Trustee
and has not ceased to act under the appointment, or a petition is
(vi)
presented for the winding up of the existing Trustee (other than for the purpose of and followed by a
reconstruction, unless during or following such reconstruction the existing
(vii)
Trustee becomes or is declared to be insolvent); or
(viii)
The Trustee is under investigation for conduct that contravenes the Trust Companies Act 1949, the
Trustee Act 1949, the Companies Act 1965 or any securities law.
6.10 Policy on Conflict of Interest
The Manager has in place policies and procedures to deal with any conflict of interest situations. In making an
investment transaction for the Fund, the Manager will not make improper use of its position in managing the Fund to
gain, directly or indirectly, any advantage or to cause detriment to the interests of Unit Holders.
Where Directors or the Investment Committee members’ interests may conflict with that of the Fund, they are to
refrain from participating in the decision-making process relating to the matter. All staff are required to seek prior
approval from the Head of Department before dealing in any form of securities. All transactions with related parties
are to be executed on terms which are best available to the Fund and which are not less favorable to the Fund than an
arms-length transaction between independent parties.
6.11 Policies and Procedures on Anti Money Laundering
In order to comply with the Anti-Money Laundering and Anti-Terrorism Financing Act 2001 (AMLA) and the
relevant policies, procedures, guidelines and/or regulations aimed at the prevention of money laundering, the
Manager will be required to obtain satisfactory evidence of customer’s identity and have effective procedures for
verifying the bona fides of customers.
The Manager conducts on-going due diligence and scrutiny of customers’ identity and his/her investment objectives
which may be undertaken throughout the course of the business relationship to ensure that the transactions being
conducted are consistent with the Manager’s knowledge of the customer, its business and its risk profile.
It may not have direct contact with such customers and depending on the circumstances of each application, a
detailed verification of identity might not be required where :
(i)
the applicant makes the payment for his/her investment from an account held in the applicant’s name at a
recognized financial institution;
(ii)
the applicant is regulated by a recognized regulatory authority and is based or incorporated in, or formed
under the law of, a recognized jurisdiction; or
(iii)
the application is made through an intermediary which is regulated/licensed by a recognized regulatory
authority and is based in or incorporated in, or formed under the law of a recognized jurisdiction.
The Manager also reserves the right to request such information as is necessary to verify the source of the payment.
The Manager may refuse to accept the application and the subscription monies if an applicant of Units delays in
producing or fails to produce any information required for the purposes of verification of identify or source of funds,
and in that event the Manager shall return the application monies (without interest and at the expense of the applicant)
by telegraphic transfer to the account from which the monies were originally sent or by way of a cheque to the
applicant’s last known address on the records of the Manager.
A transaction or a series of transaction shall be considered as ‘suspicious’ if the transaction in question is inconsistent
with the customer’s known transaction profile or does not make economic sense. Suspicious transactions shall be
submitted directly to the Financial Intelligence Unit of Bank Negara Malaysia.
18
6.12 Material Litigations
As at 31st January 2014 the Manager is not engaged in any material litigation and arbitration, including those
pending or threatened, and any facts likely to give rise to any proceedings which might materially affect the
business/financial position of the Manager and any of its delegates.
19
7.
THE TRUSTEE
7.1
PROFILE OF CIMB ISLAMIC TRUSTEE BERHAD (TRUSTEE FOR ARCMF)
7.1.2
FINANCIAL HIGHLIGHTS
The following is a summary of the past performance of CIMB Islamic Trustee based on audited accounts for the
past three financial years ended 31 December:2012
2011
2010
RM
RM
RM
Paid-Up Capital
1,000
1,000
500
Shareholders’ Fund
6,311
5,317
4,631
Turnover
4,000
5,164
5,644
Pretax Profit
1,386
2,322
1,836
993
1,740
1,357
Profit After Tax
7.1.3
GENERAL INFORMATION
7.1.4
EXPERIENCES IN TRUSTEE BUSINESS
CIMB Islaimc Trustee Berhad acts as trustee to two (2) real estate investment trust funds, twenty three (23) unit
trust funds , fifteen (15) wholesale funds and One (1) private retirement scheme (consisting of 3 funds) .In
addition to overseeing these funds, CIMB Islamic Trustee Berhad also acts as trustee to private debt securities
issues such as bonds and notes. Other than being the administrator of deceased’s estates, executor of wills, trustee
for minors or incapacitated persons, CIMB Islamic Trustee Berhad also acts as trustee for public, charitable, staff
retirement, and pension/ gratuity fund scheme, custodian trustee for associations, clubs and others.
CIMB Islamic Trustee Berhad is supported by 17 staff, constituting 10 executives and 7 non-executives as at 30
January 2014.
7.1.5
BOARD OF DIRECTOR
The following table sets out information regarding the Board of Directors of CIMB Islamic Trustee Berhad:Name
Directorship
Zahardin Bin Omardin
Non-Executive, Independent Director &
Chairman
Chan Swee Liang
Carolina
Non-Executive, Non-Independent Director
Liew Pik Yoong
Executive, Non-Independent Director
20
7.1.6
KEY MANAGEMENT STAFF
Name
Directorship
Lee Kooi Yoke
Chief Operating Officer
Ng Lai Peng
Director, Trust Operations
Azida Binti Abdul Aziz
Associate Director
Azmi Bin Hussin
Associate Director
Yvonne Fernandez
Manager
Lee Kooi Yoke (Chief Operating Officer)
Ms Lee holds a Bachelor Degree in Administration (Finance) from Griffith University, Australia; and a member of
CPA Australia, Malaysia Institute of Accountant and Financial Planning Association Malaysia. She has more than
20 years of working experience in the financial industry. Prior to joining CIMB Trustee Services, she was heading
the operations of a unit trust management company and before that investment operations of one of the largest
insurance company.
Ng Lai Peng (Director, Trust Operations)
Ms Ng holds a Bachelor of Arts (Honours) Degree in Business Administration from the University of Bolton and
London Chamber of Commerce and Industry (LCCI) qualification and has more than ten (10) years of experience
in accounting and trust operations.
Azida Binti Abdul Aziz (Associate Director)
She holds a Diploma in Accountancy from Universiti Teknologi Mara.
experience in trust operations.
She has more than ten (10) years
Azmi Bin Hussin (Associate Director)
Azmi holds a Diploma in Business Administration from Binary Business School. He has more than eight (8) years
experience in Unit Trust Operations and Fund Accounting. Prior to joining CIMB Islamic Trustee Berhad ,he was
attached to a multinational company providing fund administration services.
Yvonne Fernandez ( Manager)
Ms Yvonne holds Degree in Bachelor of Laws from University of London (External Programme), Master of Laws
from University of Malaya and Certificate in Legal Practice. She joined CIMB Trustee Services in November 2007.
Prior to joining CIMB she was in legal practice for 3 years doing civil litigation. She handles the vetting of the legal
documentation and all related legal and compliance issues arising from Corporate Trust of CIMB Trustee Services.
21
7.1.7
DUTIES AND RESPONSIBILITIES OF THE TRUSTEE
The Trustee’s functions, duties and responsibilities are set out in the Deed. The general function, duties and
responsibility of the Trustee include, but are not limited to, the following:
(a) Take into custody the investments of the Fund and hold the investments in trust for the Unitholders;
(b) Ensure that the Manager operates and administers the Fund in accordance with the provisions of the Deed,
SC Guidelines and acceptable business practice within the unit trust industry;
(c) As soon as practicable notify the Securities Commission of any irregularity or breach of the provisions of the Deed,
SC Guidelines and any other matters which in the Trustee's opinions may indicate that the interests of Unitholders
are not served;
(d) Exercise reasonable diligence in carrying out its functions and duties, in actively monitoring the operation and
management of the Fund by the Manager to safeguard the interests of Unitholders;
(e) Maintain, or cause the Manager to maintain, proper accounting records and other records as are necessary to
enable a complete and accurate view of the Fund to be formed and to ensure that the Fund is operated and managed
in accordance with the Deed of the Fund, Prospectus, the SC Guidelines and securities law.; and
(f)
Require that the accounts be audited at least annually.
The Trustee has covenanted in the Deed that it will exercise all due diligence and vigilance in carrying out its
functions and duties, and in safeguarding the rights and interests of Investors.
Statement of responsibility by the Trustee
The Trustee has given its willingness to assume the position as Trustee of the Scheme and the entire obligation in
accordance with the Deed, all relevant laws and rules of law.
Trustee’s Declaration
The Trustee is financially independent of the Manager. The Trustee will carry out transactions on an arm’s length
basis and on terms which are best available for the Scheme, as well as act at all times in the best interest of the
Scheme’s investors. The Trustee also has adequate procedures and processes in place to prevent or control
conflicts of interest.
7.1.8
(i)
REMOVAL OR REPLACEMENT OF THE TRUSTEE
Retirement
The Trustee may retire upon giving twelve (12) months’ written notice to us (or such shorter period as may be
agreed upon with us). We shall within three (3) months after becoming aware of the intention of the Trustee to
retire, appoint a replacement trustee who is eligible to be appointed to act as trustee under CMSA 2007 and who has
been approved by the SC.
(ii)
Removal by us
If the Trustee :

has ceased to exist ;

is not validly appointed;

is not eligible to be appointed or to act as trustee pursuant to Section 290 of the CMSA 2007;
22

fails or refuses to act as trustee in accordance with the provisions or covenants of the Deed or the provisions of
CMSA 2007;

has a receiver appointed over the whole or a substantial part of its assets or undertaking and the Trustee has not
ceased to act under the appointment, or a petition is presented for the winding up of the Trustee (other
than for the purpose of and followed by a reconstruction, unless during or following such reconstruction on
the Trustee becomes or is declared to be insolvent); or

is under investigation for conduct that contravenes the Trust Companies Act 1949, the Trustee Act 1949, the Act or
any securities law.
We shall, as soon as practicable after becoming aware of any of the above events, take all reasonable steps to
remove the Trustee from its appointment under the Deed and appoint a replacement trustee which is eligible to be
appointed to act as trustee under the CMSA 2007 and which has been approved by the SC.
(iii) Removal by the Unit holder
The Unit holder may remove the Trustee by a Special Resolution passed at a duly convened meeting on grounds
that the Trustee is in breach of its obligations under the Deed and the Trustee has failed to remedy the breach
despite the request from us to remedy the breach and another trustee (which is eligible to be appointed to act as
trustee under CMSA 2007 and duly approved by the SC) appointed.
(iv) Removal by SC
The SC may remove the Trustee under CMSA 2007.
7.1.9
TRUSTEE’S DELEGATE
CIMB Islamic Trustee Berhad has appointed CIMB Group Nominees (Tempatan) Sdn Bhd as the Trustee’s
delegate to perform custodial function. CIMB Group Nominees (Tempatan) Sdn Bhd is a wholly owned subsidiary
of CIMB Bank Berhad. Its custodial function includes safekeeping, settlement and corporate action related
processing and cash and security reporting.
All investments are automatically registered in the name of the Fund. CIMB Group Nominees (Tempatan) Sdn Bhd
acts only in accordance with instructions from the Trustee.
MATERIAL LITIGATION AND ARBITRATION
As at 31st January 2014, the Trustee is not engaged in any material litigation and arbitration, either as plaintiff or
defendant, which has a material effect on the financial position of the Trustee and the board of directors of the
Trustee do not know of any proceeding pending or threatened or of any facts likely to give rise to any proceedings
which might materially and adversely affect the position of the Trustee.
Trustee’s Obligation
The Trustee’s obligation in respect of monies paid by an investor for the application of units arises when the
monies are received in the relevant account of the Trustee for the Funds and the Trustee’s obligation is discharged
once it has paid the redemption amount to the Manager.
23
8.
SALIENT TERMS OF THE DEEDS
8.1
Unitholder’s Rights and Liabilities
A unitholder is a person registered in the register as a holder of units or fractions of units in a fund which
automatically accord him rights and interest in the fund.
Unitholder shall be entitled to receive the distributions of the funds, participate in any increase in the capital value
of the units and to other rights and privileges as are provided for in the Deed.
Unitholders are vested with the powers to call for a unitholders’ meeting and to vote for the removal of the Trustee or
the Manager through Special Resolution.
Investors who are investing with ARIM for the first time are entitled to a cooling-off period of 6 Business Days from
the date of receipt of the application form and payment by ARIM. This cooling-off right, however, shall not extend
to a corporation or institution, the staff of ARIM and person registered to deal in its unit trust funds.
In addition, unitholders shall receive annual and interim reports of the funds which are sent out within two months
from the close of each financial year/period.
No unitholder shall be entitled to require the transfer to him of any of the assets comprised in the funds or be
entitled to interfere with or question the exercise by the Trustee or the Manager on his behalf of the rights of the
Trustee as owner of such assets.
No unitholders shall by reason of the provisions of the Deed and the relationship created thereby between the
unitholders, the Trustee and the Manager be liable for any amount in excess of the purchase price paid for the unit
and shall not be under any obligation to indemnify the trustee and/or the Manager in the event that the liabilities
incurred by the Trustee and the Manager in the name of or on behalf of the funds pursuant to and/or in the
performance of the provisions of the Deed the Gross Asset Value of the funds and any right of indemnity of the
Trustee and/or Manager will be limited to recourse to the funds.
8.2
Jointholders
Units may be registered in the name of more than one unitholder subject to a maximum number of two jointholders.
If the units are held by jointholders of whom one is a minor, the first registered unitholder must be an adult who is not
less than 18 years of age.
In the event of the demise of a jointholder, the Manager shall only recognize the surviving jointholders as the rightful
person having title or right of interest to the units in the account. However, if the surviving jointholder is a minor,
the units in the account shall be vested in the estate of the deceased jointholder upon receipt by the Manager of the
necessary documentation.
8.3
Maximum Fees and Charges Permitted by the Deed.
Fund
AmanahRaya Cash Management
Fund
(ARCMF)
Management Fee
Trustee Fee
Up to 0.5% per annum
calculated daily based on
NAV of the Fund
0.08% per annum
of the NAV
Service
Charge
Repurchase
Charge
Nil
Nil
A lower fee and/or charges than what is stated in the deed may be charged, all current fees and charges are disclosed in
the Information Memorandum.
Any increase of the fees and/or charges above that stated in the current Information Memorandum may be made
provided that a supplemental Information Memorandum is issued and the maximum stated in the deed shall not be
breached.
24
Any increase of the fees and/or charges above the maximum stated in the deed shall require unitholders’
approval.
8.4
Permitted Expenses Payable Out of the Funds
The major expenses that are recoverable directly from the funds include:
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)
(ix)
8.5
Commission/fees paid to brokers in effecting dealings in the investment of the funds, shown on the
contract notes or difference account;
(where the custodial function is delegated by the relevant Trustee for foreign markets investment),
charges/fees paid to the-sub custodian;
Tax and other duties charged on the funds by the funds by the Government and other authorities;
The fee and other expenses properly incurred by the Auditor and all professional and accounting fees and
disbursements approved by the relevant Trustee;
Fees for the valuation of any investment of the funds by independent valuers for the benefit of the funds;
Costs incurred for the modification of the deed other than those for the benefit of the funds;
Costs incurred for any meeting of unitholders other than those convened by the Manager or Trustee for its own
benefit;
The costs of printing and dispatching to unitholders the accounts of the funds, tax certificates, distribution
warrants, notices of meeting of unitholders, newspaper advertisement and such other similar costs as may be
approved by the relevant Trustee; and
Any other expenses properly incurred by the relevant Trustee in the performance of its duties and
responsibilities.
Retirement, Removal and Replacement of the Manager
The Management Company may retire upon giving twelve (12) months’ notice (or such shorter period as the
Manager and Trustee may agree) to the Trustee of its desire to do so, and may by deed appoint in its stead a new
Management Company approved by the Trustee and the SC.
The Management Company shall also retire, if so required by the Trustee, on the grounds that:



8.6
a special Resolution to that effect has been passed by the Unit Holders at a meeting called for that purpose;
the Manager has failed or neglected to carry out its duties to the satisfaction of the Trustee and Trustee
considers that it would be in the interests of Unit Holders for it to do so after the Trustee has given Notice to
it of that opinion and the reason for that opinion, and after
consultation with the relevant authorities and with the approval of Unit Holders
the manager has gone into liquidation, except for the purpose of amalgamation or reconstruction or some
similar purpose, or has had a receiver appointed or has ceased to carry on business.
Retirement, Removal and Replacement of the Trustee
The Trustee may retire upon giving twelve (12) months’ notice to the Manager of its desire to do so, or such shorter
period as the Manager and the Trustee may agree, and may by deed appoint in its stead a new Trustee approved by the
Securities Commission.
The Trustee may be removed and another Trustee may be appointed by special resolution of the Unit Holders at a
Unit Holders’ meeting convened in accordance with the Deed.
25
A management company shall take all reasonable steps to replace a Trustee as soon as practicable after becoming
aware that:
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
8.7
The Trustee has ceased to exist;
The Trustee has not been validly appointed;
The Trustee is not eligible to be appointed or to act as Trustee under Section 290 of CMSA 2007;
The Trustee has failed or refused to act as Trustee in accordance with the provisions or covenants of the Deed
or the provisions of CMSA 2007;
A receiver is appointed over the whole or a substantial part of the assets or undertaking of the existing Trustee
and has not ceased to act under the appointment, or a petition is
Presented for the winding up of the existing Trustee (other than for the purpose of and followed by a
reconstruction, unless during or following such reconstruction the existing Trustee becomes or is declared to
be insolvent); or
The Trustee is under investigation for conduct that contravenes the Trust Companies Act 1949, the Trustee Act
1949, the Companies Act 1965 or any securities law.
Termination of the Fund
Termination by the Manager
The Manager may in its absolute discretion created and wind up the Fund at any time.
Upon the termination of the Fund by the Manager, the Trustee shall as soon as practicable give to each Unit holder of
the Fund being wound up notice of such termination, the Manager shall notify the Unit holders of the Fund in writing.
Termination by the Trustee
In any of the following events:



If the Manager has gone into liquidation
If in the opinion of the Trustee, the Manager has ceased to carry on business
If in the opinion of the Trustee, the Manager has to be prejudice of Unit holders failed to comply with the
provisions of the Deed or contravened any of the provisions of any relevant Law
The Trustee shall summon a meeting of Unit holders for the purpose of seeking directions from the Unit holders.
If at any such meeting a Special Resolution to terminate the Fund is passed by the Unit holders, the Trustee shall
apply to the court for an order confirming such Special Resolution.
8.8
Unitholders Meeting
Unless otherwise required or allowed by the relevant laws, the Manager shall, within twenty-one (21) days of
receiving an application from not less than fifty (50) or one-tenth (1/10) of all the Unit Holders, whichever is less,
summon a meeting of the Unit Holders by:
(a)
(b)
sending by post at least seven (7) days before the date of the proposed meeting a notice of the proposed meeting
to all the
Unit Holders; and
publishing at least fourteen (14) days before the date of the proposed meeting an advertisement giving
notice of the proposed meeting in a national language newspaper published daily and another newspaper
approved by the relevant authorities.
26
The Unit Holders may apply to the Manager to summon a meeting for any purpose including, without limitation, for
the purpose of:
(a)
(b)
(c)
(d)
requiring the retirement or removal of the Manager;
requiring the retirement or removal of the Trustee;
considering the most recent financial statements of the Fund; or
giving to the Trustee such directions as the meeting thinks proper;
provided always that the Manager shall not be obliged to summon such a meeting unless application has been received
from not less than fifty (50) or one-tenth of all the Unit Holders, whichever is the lesser number.
Meetings summoned by the Trustee
Where:
(a)
the Manager is in liquidation,
(b)
in the opinion of the Trustee, the Manager has ceased to carry on business, or
(c)
in the opinion of the Trustee, the Manager has, to the prejudice of Unit Holders, failed to comply with this
Deed or contravened any of the provisions of the Act,
Meetings summoned by the Manager
The Manager may for any purpose whatsoever summon a meeting of the Unit Holders by sending by post at least
fourteen (14) days before the date of the proposed meeting, or such other time as may be prescribed by the
relevant laws, a notice of the proposed meeting to all the Unit Holders.
Provisions governing Unit Holders' Meetings
The quorum required for a meeting of the Unit Holders shall be five (5) Unit Holders, whether present in person or
by proxy, provided always that the quorum for a meeting of the Unit Holders convened for the purpose of removing
the Manager and/or the Trustee shall be ten (10) Unit Holders, whether present in person or by proxy, who must
hold in aggregate at least fifty per centum (50%) of the Units in circulation at the time of the meeting. If the Fund
has five (5) or less Unit Holders, the quorum required for a meeting of the Unit Holders of the Fund shall be two (2)
Unit Holders, whether present in person or by proxy; if the meeting has been convened for the purpose of removing
the Manager and/or the Trustee, the Unit Holders present in person or by proxy must hold in aggregate at least fifty
per centum (50%) of the Units in circulation at the time of the meeting.









Every question arising at any Unit Holders' meeting shall be decided in the first instance by a show of
hands unless a poll be demanded or if it be a question which under this Deed requires a Special Resolution a
poll shall be taken.
On a show of hands every Unit Holder who is present in person or by proxy shall have one vote.
Upon a poll every Unit Holder present in person or by proxy shall have one vote for every Unit held by him.
A poll may be demanded before or immediately after any question is put to a show of hands.
Every Unit Holder entitled to attend a meeting and to vote thereat may vote personally or by proxy. The proxy
appointed need not be a Unit Holder. Where a Unit Holder is a company, the proxy may be any officer of such
company appointed in the manner provided in section 147(3) of the Companies Act 1965. The Manager or the
Trustee may accept a certificate under section 147(5) of the Companies Act 1965 as evidence of the proxy's
appointment. The proxy may exercise on behalf of the company the same powers as the company could if it
were a natural person and the company is to be taken to be a natural person present at the meeting in person.
In the case of Jointholders, any one of such Jointholders may vote either personally or by proxy as
comprised in the jointholding, but if Jointholders are present at any meeting either personally or by proxy,
the Jointholder whose name stands first in the Register shall alone be entitled to vote in respect thereof.
Several executors or administrators shall be deemed to be Jointholders.
The Manager may not exercise any voting rights in respect of the Units held by it or its nominees at any Unit
Holders' meeting regardless of the party who requested the meeting and the matter or matters which are laid
before the meeting.
Any party related to the Manager may not exercise any voting rights in respect of the Units held by such
party in any Unit Holders' meeting.
27
8.9
The Deed
Copies of the Deed may be obtained from the Manager at a cost of RM20 each or may be inspected free of charge
during normal working hours at the offices of the Manager.
All unitholders of units will be entitled to the benefit of, be bound by and be deemed to have notice of the provisions
of the Deed, copies of which are available as mentioned above.
28
9.
TAXATION
TAXATION ADVISER’S LETTER IN RESPECT OF THE TAXATION
OF THE UNIT TRUST AND THE UNIT HOLDERS
(PREPARED FOR INCLUSION IN THIS INFORMATION MEMORANDUM)
Ernst & Young Tax Consultants Sdn. Bhd.
Level 23A, Menara Milenium
Pusat Bandar Damansara
50490 Kuala Lumpur
10 February 2014
The Board of Directors
Amanah Raya Investment Management Sdn Bhd
Level 7 & 8, Wisma Amanah Raya
No 2 Jalan Ampang
50508 Kuala Lumpur
Dear Sirs
TAXATION OF THE UNIT TRUST AND UNIT HOLDERS
This letter has been prepared for inclusion in this Information Memorandum in connection with the offer of units in
the unit trust known as AmanahRaya Cash Management Fund (hereinafter referred to as “the Fund”).
The purpose of this letter is to provide prospective Unit holders with an overview of the impact of taxation on the Fund
and the Unit holders.
TAXATION OF THE FUND
The taxation of the Fund is subject to the provisions of the Malaysian Income Tax Act, 1967 (“MITA”), particularly
Sections 61 and 63B.
Subject to certain exemptions, the income of the Fund comprising dividends, interest and other investment income
derived from or accruing in Malaysia after deducting tax allowable expenses, is subject to Malaysian income tax, which
is currently imposed at the rate of 25%.
Tax allowable expenses would comprise expenses falling under Section 33(1) and Section 63B of the MITA.
Section 33(1) permits a deduction for expenses that are wholly and exclusively incurred in the production of gross
income. In addition, Section 63B allows unit trusts a deduction for a portion of other expenses (referred to as
‘permitted expenses’) not directly related to the production of income, as explained below.
“Permitted expenses” refer to the following expenses incurred by the Fund which are not deductible under Section 33(1)
of the MITA:

the manager's remuneration,

maintenance of the register of Unit holders,

share registration expenses,

secretarial, audit and accounting fees, telephone charges, printing and stationery costs and postage.
These expenses are given a partial deduction under Section 63B of the MITA, based on the following formula:
A x B
4C
Where:
A
B
C
is the total of the permitted expenses incurred for that basis period;
is gross income consisting of dividend [1], interest and rent chargeable to tax for that basis period;
and
is the aggregate of the gross income consisting of dividend [1] (whether exempt or not), interest and
rent, and gains made from the realization of investments (whether chargeable to tax or not) for that
basis period,
[1] Pursuant to Section 15 of the Finance Act 2011, with effect from the year of assessment 2011, dividend income is
deemed to include income distributed by a unit trust which includes distributions from Real Estate Investment Trusts.
29
provided that the amount of deduction to be made shall not be less than 10% of the total permitted expenses incurred for that basis
period.
Exempt Income
The following income of the Fund is exempt from tax:

Malaysian sourced dividends
Tax exempt dividends received from investments in companies which had previously enjoyed or are currently enjoying certain tax
incentives provided under the relevant legislation.
Paragraph 12B, Schedule 6 of MITA states that exempt dividend includes any dividend paid, credited or distributed to any person
where the company paying such dividend is not entitled to deduct tax under Section 108 of MITA.

Malaysian sourced interest
(i)
interest from securities or bonds issued or guaranteed by the Government of Malaysia;
(ii) interest from debentures or Islamic securities (other than convertible loan stock) approved by the Securities Commission;
(iii) interest from Bon Simpanan Malaysia issued by Bank Negara Malaysia;
(iv) interest derived from Malaysia and paid or credited by banks or financial institutions licensed under the Banking and
Financial Institutions Act 1989 or the Islamic Banking Act 1983;
(v) interest from Islamic securities originating from Malaysia, other than convertible loan stock issued in any currency in Malaysia
and approved by Securities Commission or Labuan Offshore Financial Services Authority (LOFSA)[2];
(vi) interest received from bonds or securities issued by Pengurusan Danaharta Nasional Berhad; and
(vii) interest derived from bonds (other than convertible loan stock) paid or credited by any company listed on the Malaysian
Exchange of Securities Dealing and Automated Quotation Berhad (MESDAQ)[3].

Discount
Tax exemption is given on discount paid or credited to any unit trust in respect of investments as specified in items (i), (ii) and (iii)
above.
Foreign income
Dividends, profits and other income derived from sources outside Malaysia and received in Malaysia by a resident unit trust is
exempt from Malaysian income tax. However, such income may be subject to tax in the country from which it is derived.
Gains from the realization of investments
Pursuant to Section 61(1) (b) of the MITA, gains from the realization of investments will not be treated as income of the Fund and
hence, are not subject to income tax. Such gains may be subject to real property gains tax (“RPGT”) under the Real Property
Gains Tax Act, 1976 (“RPGT Act”), if the gains are derived from the sale of chargeable assets, as defined in the RPGT Act.
With effect from 1 January 2012, any chargeable gain on the disposal of chargeable assets would be subject to RPGT at the applicable tax
rate depending on the holding period as follows under the Real Property Gains Tax (Exemption) Order 2011 [P.U. (A) 434/2011].
Holding Period
(i)
RPGT
Rates
10%
(ii)
Up to 2 years
Exceeding 2 until 5
years
(iii)
Exceeding 5 years
0%
5%
Funds can still enjoy a full exemption from RPGT on disposals of chargeable assets held more than 5 years.
…………………………………………………………………..
[2] Pursuant to Section 4 of the Finance Act 2011, with effect from 11 February 2010, ‘LOFSA’ refers to Labuan Financial Services Authority (LFSA) .
[3] MESDAQ was replaced by FTSE Bursa Malaysia ACE with effect from 3 August 2009, therefore any interest derived from bonds (other than
convertible loan stock) paid or credited by any company listed on MESDAQ should still qualify for an exemption up to 2 August 2009. However, from
3 August2009 and up to the date of this letter, there is no new gazette order issued to exempt interest derived from bonds paid or credited by a
company listed in the new FTSE Bursa Malaysia ACE.
30
Tax credit
Tax deducted at source from Malaysian dividends received by the Fund will be available for set-off either wholly or
partly against the tax liability of the Fund. Should the tax deducted at source exceed the tax liability of the Fund, the
excess is refundable to the Fund. [4]
TAXATION OF UNIT HOLDERS
For Malaysian income tax purposes, Unit holders will be taxed on their share of the distributions received from the Fund.
The income of Unit holders from their investment in the Fund broadly falls under the following categories:
1. taxable distributions; and
2. non-taxable and exempt distributions.
In addition, Unit holders may also realize a gain from the sale of units.
The tax implications of each of the above categories are explained below:
1.
Taxable distributions
Distributions received from the Fund will have to be grossed up to take into account the underlying tax paid by the
Fund and the unit holder will be taxed on the grossed up amount.
Such distributions carry a tax credit, which will be available for set-off against any Malaysian income tax payable
by the unit holder. Should the tax deducted at source exceed the tax liability of the unit holder, the excess is
refundable to the unit holder.
Distributions received by a non-resident unit holder from income which has been taxed at source at 25%, will not
be subject to any further tax in Malaysia.
Please refer to the paragraph below for the tax rates applicable to the grossed up distributions.
2. Non-taxable and exempt distributions
Tax exempt distributions made out of gains from the realization of investments and other exempt income earned by
the Fund will not be subject to Malaysian tax in the hands of the Unit holders.
…………………………………………………………….
[4] Pursuant to Section 51 of the Finance Act 2007, a person is not entitled for a set off if the shares are held for less than 90 days or the
dividend is not derived from ordinary shares. This prohibition is not applicable for shares in a company listed on the Bursa
Malaysia. Further, Section 50 of the Finance Act 2009 indicates that a person is not entitled to a set off if the dividend paid to that
person is not in cash.
31
Rates of tax
The Malaysian income tax chargeable on the Unit holders depends on their tax residence status and whether they are
individuals, corporations or trust bodies. The income tax rates charged are as follows:
Malaysian Income Tax Rates
Malaysian tax resident:
Unit Holders
• Individual and non-corporate Unit holders (such
as, associations and societies)
• Progressive tax rates ranging from 0% to
26%
•
• Progressive tax rates ranging from 0% to
25%
Co-operatives
• Trust bodies
• 25%
Note:
Non-resident Unit holders may be subject to tax in their respective countries depending on the provisions of the
tax legislation in the respective countries and any existing double taxation arrangements with Malaysia.
Gains from sale of units
Gains arising from the realization of investments will not be subject to income tax in the hands of Unit holders
unless they are insurance companies, financial institutions or traders/ dealers in securities.
Unit splits and reinvestment of distributions
Unit holders may also receive new units as a result of unit splits or may choose to reinvest their distributions. The tax
implications of these are as follows:
 Unit splits – new units issued by the Fund pursuant to a unit split will not be subject to tax in the hands of the Unit
holders.

Reinvestment of distributions – Unit holders may choose to reinvest their income distribution in new units by
informing the Manager.
In this event, the Unit holder will be deemed to have received the distribution and reinvested it with the Fund.
……………………………………………………………………………………………….
[5] A company would not be eligible for the 20% tax rate on the first RM 500,000 of chargeable income if:
a) more than 50% of the paid up capital in respect of the ordinary shares of the company is directly or indirectly owned by a related
company which has a paid up capital in respect of ordinary shares of more than RM 2.5 million at the beginning of a basis period
for a year assessment;
b) the company owns directly or indirectly more than 50% of the paid up capital in respect of the ordinary shares of a related
company which
has a paid up capital in respect of ordinary shares of more than RM 2.5 million at the beginning of a basis period for a year of
assessment;
c) more than 50% of the paid up capital in respect of the ordinary shares of the company and a related company which has a paid up
capital in respect of ordinary shares of more than RM 2.5 million at the beginning of a basis period for a year of assessment
is directly or indirectly owned by another company.
In the 2014 Malaysian Budget announcement, t was proposed that the income tax rate be educed to 19% on chargeable income up to
RM500,000 and 24% on the remaining chargeable income, with ffect from the year of assessment 2016. This proposal has yet o e
legislated.
In the 2014 Malaysian Budget announcement, it was proposed that the income tax rate for non-resident individuals be reduced from 26%
to 25%, with effect from the year of assessment 2015. This proposal has yet to be legisloated.
32
We hereby confirm that, as at the date of this letter, the statements made in this report correctly reflect our
understanding of the tax position under current Malaysian tax legislation and the related interpretation and practice
thereof, all of which are subject to change, possibly on a retrospective basis. We have not been retained (unless
specifically instructed hereafter), nor are we obligated to monitor or update the statements for future conditions
that may affect these statements.
The statements made in this letter are not intended to be a complete analysis of the tax consequences relating to an
investor in the Fund. As the particular circumstances of each investor may differ, we recommend that investors
obtain independent advice on the tax issues associated with an investment in the Fund.
Yours faithfully
Ernst & Young Tax Consultants Sdn Bhd
Farah Rosley
Partner
Ernst & Young Tax Consultants Sdn. Bhd. has given its consent to the inclusion of the Taxation Adviser’s Letter
in the form and context in which it appears in this Information Memorandum and has not withdrawn such
consent prior to the delivery of a copy of this Information Memorandum for approval.
33
10.
STATEMENT OF CONSENT
Ernst & Young Tax Consultants Sdn Bhd, Malayan Banking Berhad, CIMB Islamic Trustee Berhad, CIMB Group
Nominees (Tempatan) and Company Secretary (ARB) have given their written consents to act in their respective
capacity and have not subsequently withdrawn their consent to the inclusion of their names and/or letter/report in the
form and context in which it appears in this Information Memorandum.
34
11. DOCUMENTS AVAILABLE FOR INSPECTION
Unit Holders may inspect without charge, at the registered offices of the Manager and the Trustee, for a period of not
less than 12 months from the date of this Information Memorandum, the following documents or copies thereof,
where applicable:
(a)
Deed of the Fund
(b)
Each material contract or document referred to in the Information Memorandum
(c)
All reports, letters or other documents, valuations and statements by any expert, any part of which is extracted
or referred to in the Information Memorandum.
(d)
The audited accounts of the Manager and the Fund for the last 5 financial years or from the date of
incorporation/commencement, if less than 5 years, preceding the date of Information Memorandum.
(e)
Any consent given by experts or persons whose statement appears in the Information Memorandu
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12.
UNIT TRUST LOAN FINANCING RISK DISCLOSURE STATEMENT
UNIT TRUST LOAN FINANCING RISK DISCLOSURE STATEMENT
Investing in a unit trust fund with borrowed money is more risky than investing with your own savings.
You should asses if loan financing is suitable for you in light of your objectives, attitudes to risk and financial
circumstances. You should be aware of the risks, which would include the following:i.
The higher the margin of financing (that is, the amount of money you borrow for every Ringgit of your own
money that you put in as deposit or down payment) the greater the potential for losses as well as gains.
ii.
You should assess whether you have the ability to service the repayments on the proposed loan. If your loan is a
variable rate loan, and if interest rates rise, your total repayment amount will be increased.
iii. If unit prices fall beyond a certain level, you may be asked to provide additional acceptable collateral or pay
additional amounts on top of your normal installments. If you fail to comply within the time prescribed, your
units may be sold to settle your loan.
iv. Returns on unit trusts are not guaranteed and may not be earned evenly over time. This means that there may be
some years where returns are high and other yeas where losses are experienced instead. Whether you eventually
realize a gain or loss may be affected by the timing of the sale of your units. The value of units may fall
just when you want your money back even though the investments may have done well in the past.
The brief statement cannot disclose all the risks and other aspects of loan financing. You should therefore
carefully study the terms and conditions before you decide to take the loan. If you are in doubts in respect of any
of this risk disclosure statement or the terms of the loan financing, you should consult the institution offering the
loan.
ACKNOWLEDGEMENT OF RECEIPT OF RISK DISCLOSURE STATEMENT
I acknowledge that I have received a copy of this Unit Trust Loan Financing Risk Disclosure Statement and
understand its contents.
Signature
:
Full Name
:
Date
:
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13.
DIRECTOR’S DECLARATION
This information memorandum has been seen and approved by the Directors of AmanahRaya Investment
Management Sdn Bhd and they collectively and individually accept full responsibility for the accuracy of all
information contained herein and confirm, having made all enquiries which are reasonable in the circumstances,
that to the best of their knowledge and belief, there are no other facts omitted which would make any herein
misleading.
Signed by the Directors:
Datuk Mohamed Adnan bin Ali (Chairman) (Independent/ Non-Executive)
Meor Khairi bin Meor Mohd Bazid (Managing Director/Chief Executive Officer)
Azhar bin Harun (Independent/ Non-Executive)
Dato’ Haji Che Pee bin Samsudin (Non-Independent/Non-Executive)
Haji Zulkifly bin Sulaiman (Independent/Non-Executive)
Hawariah binti Idris (Non-Independent/Non-Executive)
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