The Financial Statements give a true and fair view and have been
prepared in accordance with the Law.
Corporate Governance Statement
The Company is regulated by the Guernsey Financial Services
Commission (the "GFSC") as an authorised entity under the
Authorised Closed Ended Investment Scheme Rules 2008 with the
Preference Shares of its cells being listed on the CISE.
On 30 September 2011, the GFSC issued the Finance Sector Code of
Corporate Governance (the "Guernsey Code") which came into effect
from 1 January 2012. As the Company is regulated by the GFSC as an
authorised collective investment scheme it is subject to the
Guernsey Code. The Board of directors previously voluntarily
complied with the UK Corporate Governance Code published by the
Financial Reporting Council (the "Code"). Adherence to the Code
ensured that the Company was deemed to comply with the requirement
of the Guernsey Code. However, to avoid unnecessarily reporting
under two regimes, the Board of directors has elected to only
report under the Guernsey Code
The Board are satisfied that the Company's governance practices
throughout the year ended 31 October 2013 were in accordance with
all the principles of the Guernsey Code and continue to be in
compliance as at the date of this report.
The Company's directors place a high degree of importance on
ensuring that high standards of corporate governance are maintained
and resolved that a Board Governance review be conducted
annually.
The Board is responsible for investment of the Company's assets,
for and on behalf of each cell, and for monitoring the performance
of the investments held by the Company for the account of each
cell. The Board is also responsible for declarations of dividends
out of the assets of individual cells where applicable. As all of
the directors are non-executive, the day-to-day administration of
the Company's affairs has been delegated to third-party service
providers, including the Investment Manager, the Administrator and
Secretary, the Registrar and the Custodian. Their appointment and
performance of their duties remains subject to the overall
supervision of the Board.
The Board meets at least four times a year to consider the
business and affairs of the Company for the previous quarter.
Between these quarterly meetings the Board meets to consider
specific matters of a transactional nature and there is regular
contact with the Secretary. During the reporting period the Board
or committees thereof, met 25 times.
The directors are kept fully informed of investment and
financial controls and any other matters that are relevant to the
business of the Company and should be brought to the attention of
the directors. The directors also have access to professional
advice, where necessary in the furtherance of their duties, at the
expense of the Company.
The Board has a breadth of experience relevant to the Company,
and, whilst no separate nomination committee has been established,
the directors believe that any changes to the Board's composition
can be managed without undue disruption. If any new directors are
appointed to the Board a full and tailored induction will be
provided on joining the Board. The performance of the Board, and
each director, is reviewed annually by the Board by way of a
Performance Evaluation questionnaire.
Audit Committee
An Audit Committee has been established consisting of all four
directors, of whom Mr Hunt and Mr Le Prevost are considered to be
independent. Notwithstanding that Mr Le Prevost is a director of
Anson Registrars Limited he is considered to be independent as he
does not perform any executive functions in respect of the Company
on behalf of that service provider. Mr Hunt is considered
independent as he is not connected to any of the Company's service
providers.
In the performance of its duties, the Audit Committee has regard
to the Guidance on Audit Committees published by the Financial
Reporting Council in 2010, as amended in 2012. The Audit Committee
examines the effectiveness of the Company's internal control
systems, the annual and half-yearly reports and Financial
Statements, the auditors' remuneration and engagement, as well as
the auditors' independence and any non-audit services provided by
them. The Audit Committee receives compliance updates from the
Secretary's compliance department and the external auditors on an
on-going basis.
The Audit Committee meets at least twice annually, being before
the Board meets to consider the Company's annual and half-yearly
reports and financial statements. The Audit Committee operates
within clearly defined terms of reference and provides a forum
through which the Company's external auditors report to the Board.
The terms of reference of the Audit Committee are available from
the Secretary upon request.
There is no internal audit function. As all of the directors are
non-executive, and all of the Company's management and
administration functions have been delegated to independent service
providers, the Audit Committee does not deem it necessary for the
Company to have an internal audit function but will review this
requirement periodically.
Dividend Committees
The Company has established Dividend Committees, consisting of
any one director or their alternate, for the purpose of declaring
dividends payable out of each of BNP Paribas Enhanced Income, US
Enhanced Income and UK Enhanced Income cells. All dividends
declared and paid by these cells are in accordance with a fixed
timetable, and calculated using a prescribed formula, as specified
in the relevant Summary and Securities Note of each cell.
Therefore, the Board has no discretion with regard to the level or
timing of such dividends.
Internal Controls
The Board is responsible for the Company's system of internal
control and for reviewing its effectiveness. The Board confirms
that there is an on-going process for identifying, evaluating and
managing the significant risks faced by the Company. This process
has been in place for the reporting period under review, and up to
the date of approval of this Annual Report and Financial
Statements, and is regularly reviewed by the Board.
The internal control systems are designed to meet the Company's
particular needs and the risks to which it is exposed. Accordingly,
the internal control systems are designed to manage rather than
eliminate the risk of failure to achieve business objectives and,
by their nature, can only provide reasonable, and not absolute,
assurance against misstatement and loss.
Collateral Arrangements
In accordance with the investment objectives and policies of
each of the Company's cells, and the contracts entered into between
the Company, on behalf of each cell, and the Investment
Counterparty, BNP Paribas is required to provide collateral to meet
its obligations under each Contract in the form of AAA rated G7
government bonds to the designated collateral accounts held in
favour of the Company, acting on behalf of each cell. The
collateral is valued on a weekly basis.
The amount of collateral which BNP Paribas is required to post
in favour of each cell, for the tenure of the relevant Contract, is
to the value of 100% of the indirect exposure to the credit risk of
BNP Paribas of all preference share holders in the relevant cell
(other than BNP Paribas Arbitrage SNC) plus an additional 10% of
the relevant cell's total exposure to the credit risk of BNP
Paribas (up to a maximum of 100% of such total exposure). Should a
default occur, the Company is able to uphold its rights under the
restructuring deed between the Company, BNP Arbitrage SNC and BNP
Paribas.
BNP Paribas Arbitrage SNC has waived its rights to pari passu
payment with other preference share holders of all redemption
amounts where there is a default by BNP Paribas under the relevant
swap contract, thereby subordinating its rights in favour of all
other preference shareholders (on default by BNP Paribas).
Dialogue with Shareholders
The directors are always available to enter into dialogue with
shareholders and the Company believes such communications to be
important. BNP Paribas regularly meet with the Company's major
shareholders and report to the Board of directors at least
quarterly on those shareholders' views about the Company and any
issues or concerns they might have. BNP Paribas can also be
contacted by shareholders, both by telephone and e-mail, their
contact details are contained within these Financial
Statements.
Going Concern
Given the nature of the Company and its investments, the
directors are satisfied that it is appropriate to continue to adopt
the going concern basis in preparing the Financial Statements, and,
after due consideration, the directors consider that the Company is
able to continue for the foreseeable future.
By order of the Board
John R Le Prevost Trevor P Hunt
Director Director
12 February 2014
INVESTMENT MANAGER'S REPORT
On the invitation of the directors of the Company, the following
commentary is provided by THEAM, the Investment Manager. Their
commentary is provided as a source of useful information for
shareholders of the Company but is not directly attributable to the
Company.
Enhanced Property Recovery
Listing: Channel Islands Securities Exchange Authority
Launch date: 13 March 2008
Issue price at launch: 100 pence
NAV immediately following launch: 100 pence
Maturity date: 20 March 2014
ISIN: GG00B2PWW869
SEDOL: B2QBZY9
Investment Objective
The EPR Shares allow investors to benefit from a possible
recovery in the listed property market with an enhanced market
timing mechanism. At maturity, if the EPRA Index finishes above its
initial level, the fund will pay the greater of either 170% or the
enhanced performance of the EPRA Index. If the EPRA Index closes
below the initial level, the EPR Shares will track the EPRA
Index.
Investment Performance
Grafico Azioni UK Enhanced In (LSE:UKE)
Storico
Da Apr 2024 a Mag 2024
Grafico Azioni UK Enhanced In (LSE:UKE)
Storico
Da Mag 2023 a Mag 2024
