Trinidad and Tobago Unit Trust Corporation
Notes
to the Consolidated
Financial Statements
FOR THE YEAR ENDED
31 DECEMBER, 2012
Expressed in
Trinidad and Tobago dollars
A41
Exchange rate risk
Collective Investment Schemes - Registered as local unit trust schemes
The value of the net assets of the portfolios may fluctuate with changes in foreign exchange rates. This risk is currently limited to
the Growth & Income Fund, the TT$ Income Fund and the Universal Retirement Fund as these TT dollar-denominated Funds may
hold financial assets denominated in other currencies. As a consequence, the value of the net assets and/or earnings of the TT$
denominated portfolios could increase or decrease in value due to exchange rate fluctuations of individual currencies relative to the
TT dollar. This risk is managed by restricting non-TT dollar holdings in the individual Funds to an appropriate proportion of net assets.
The primary foreign exchange exposure in the Investment Funds is to the US$/TT$ exchange rate given the negligible holdings of
other currencies in the portfolios.
The portfolios’ foreign currency assets as at 31 December, 2012 and 31 December, 2011 were as follows:
At 31 December, 2012
At 31 December, 2011
US$
OTHER
US$
OTHER
(Presented in TT$)
$’000
(Presented in TT$)
$’000
(Presented in TT$)
$’000
(Presented in TT$)
$’000
Growth and Income Fund
Equities
953,078
14,668
768,187
20,814
Debt instruments - traded
27,519
-
8,614
-
Debt instruments – non-traded
81,394
-
66,334
-
Cash & other net assets
322,980
-
269,699
-
1,384,971
14,688
1,112,834
20,814
TT$ Income Fund
Debt instruments - traded
230,682
-
273,292
-
Debt instruments – non-traded
451,952
-
399,987
-
Cash & other net assets
609,230
-
82,039
-
1,291,864
-
755,318
-
Universal Retirement Fund
Equities
60,556
-
36,679
-
Debt instruments - traded
-
-
-
-
Debt instruments – non-traded
-
-
5,467
-
Cash & other net assets
18,199
-
10,716
-
78,755
-
52,862
-
A 1% change in the TT dollar relative to the US dollar would have changed the net assets of the individual Funds as at 31 December,
2012 and 31 December, 2011 as follows:
2012
$’000
2011
$’000
Growth & Income Fund
13,850
11,128
TT$ Income Fund
12,919
7,579
Universal Retirement Fund
788
528
29) FINANCIAL RISK MANAGEMENT
(continued)
Unit Trust Corporation
Annual Report 2012
