Annual Report Manulife Advanced Fund SPC

Manulife Advanced Fund SPC

Audited Financial Statementsfor the year ended 30 June 2021

Annual Report



Table of Contents

Company Information 1

Directors’ Report for the year ended 30 June 2021 2

Investment Manager’s Report for the year ended 30 June 2021 3

Report of the Custodian 18

Independent Auditors' Report 19

Statement of Financial Position 22

Statement of Comprehensive Income 24

Statement of Changes in Net Assets Attributable to holders of Redeemable Participating Shares 26

Statement of Changes in Equity 26

Statement of Cash Flows 27

Statement of Distribution 30

Notes to Financial Statements 38

Portfolio of Investments

– China A Segregated Portfolio (the “China A Fund”) 95

– Renminbi Bond Segregated Portfolio (the “Bond Fund”) 97

– Asia Pacific Income and Growth Segregated Portfolio (the “Asia Pacific Income and Growth Fund”) 99

– U.S. Bank Equity Segregated Portfolio (the "U.S. Bank Equity Fund") 104

– Greater Bay Area Growth and Income Segregated Portfolio (the "Greater Bay Area Growth and Income Fund") 107

Statement of Movements in Investment Portfolios 111

Performance Table 114

Information on Exposure arising from Financial Derivative Instruments 121


1

Company Information

Registered Office of the CompanyP.O. Box 309Ugland HouseGrand Cayman, KY1– 1104Cayman Islands

Principal Office of the CompanyC/o FirstCaribbean International Bank and Trust Company (Cayman) Limited (formerly known as CIBC Bank and Trust Company (Cayman) Limited) 25 Main Street, 4th FloorGeorge Town, P.O. Box 694Grand Cayman, KY1– 1107 Cayman Islands

General Adviser and Distributor of the CompanyManulife Investment Management (Hong Kong) Limited10th Floor, Lee Garden One33 Hysan AvenueCauseway BayHong Kong SAR

Investment Manager of the CompanyManulife Investment Management (Hong Kong) Limited10th Floor, Lee Garden One33 Hysan AvenueCauseway BayHong Kong SAR

Sub–Investment Manager of the U.S. BankEquity FundManulife Investment Management (US) LLC197 Clarendon Street, Boston, MA02116United States of America

Investment Adviser of the China A FundManulife TEDA Fund Management Co., Ltd.3rd Floor, South BuildingWinland International Finance Center7 Financial StreetXicheng District, Beijing 100033People's Republic of China

Auditors of the CompanyErnst & Young Ltd. Suite 6401, 62 Forum LaneCamana BayP.O. Box 510, Grand Cayman, KY1– 1106Cayman Islands

Legal Advisers to the Company(as to matters of Hong Kong law):Deacons5th Floor, Alexandra HouseChater Road, CentralHong Kong SAR

Legal Advisers to the Company(as to matters of Cayman Islands law):Maples and Calder (Hong Kong) LLP26th Floor, Central Plaza18 Harbour Road, WanchaiHong Kong SAR

Directors of the Company

Bruno Lee

Endre Pedersen

Shinichi Yamamoto (since 1 January 2021)

Leo Zerilli (until 30 December 2020)

Custodian and Paying Agent of the CompanyCitibank Europe plc, Luxembourg Branch31, Z.A. BourmichtL– 8070 BertrangeGrand Duchy of Luxembourg

Administrator of the CompanyFirstCaribbean International Bank and TrustCompany (Cayman) Limited (formerly known asCIBC Bank and Trust Company (Cayman) Limited)25 Main Street, 4th FloorGeorge Town, P.O. Box 694Grand Cayman, KY1– 1107Cayman Islands

Sub–Administrator, Registrar and Transfer Agent of the CompanyCitibank Europe plc, Luxembourg Branch31, Z.A. BourmichtL– 8070 BertrangeGrand Duchy of Luxembourg

Sub–Delegate of the Sub–Administrator, Registrar and Transfer Agent of the Company Citibank N.A., Hong Kong Branch50th Floor, Champion Tower3 Garden Road, CentralHong Kong SAR


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Directors' Report for the year ended 30 June 2021

Year in Review

The China A Fund has underperformed the benchmark over the past twelve-month period ending 30 June 2021. Asset allocation decisions added value while stock selection offset part of the gains. At the sector level, stock selection in industrials and materials contributed the most positively while consumer discretionary and healthcare hurt performance. The overweight to materials and industrials and the underweight to financials added value to performance. Partly offsetting the outperformance was the underweight to healthcare.

The Bond Fund’s overweight exposure to corporate bonds was a contributor to returns primarily due to higher carry, however, this was offset by the portfolio’s small exposure to Chinese yuan (offshore) which marginally underperformed Chinese yuan (onshore) over the period.

The Greater Bay Area Growth and Income Fund’s equity exposure increased alongside the broader Chinese and Hong Kong equity markets. Positive returns mainly came from almost all sectors led by industrials, financials, and communication services. Partly offsetting the gains was the utility sector.

The Asia Pacific Income and Growth Fund detracted on the back of stock selection and asset allocation decisions at the country and sector level.

The U.S. Bank Equity Fund has underperformed the benchmark during the period.

Outlook

Asian equities continue to trade at a reasonable discount to global markets and we anticipate strong double-digit earnings recovery in 2021. Although 10-year bond yields have risen since the start of the year, equity dividend yields continue to look attractive compared to bond yields. We see scope for further reductions in valuation dispersions between high price-earnings growth stocks and stocks that have attractive yields as we enter a period of global economic recovery as vaccinations take hold across the region and around the world.

If Asian growth continues to lag against the US growth-rate then the US dollar should continue to be supported with the US Federal Reserve Board embarking on a path to reduce its asset purchase programme as early as the end of 2021 and potential rate hikes starting in 2023. With respect to the Chinese yuan, it will likely remain supported by China’s relatively attractive interest rates and stable monetary policy while index inclusion and fund flows into Chinese assets will also help offset the factors driving US dollar strength.


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Investment Manager's Report for the year ended 30 June 2021

MAF China A Segregated Portfolio (the “China A Fund”)

Investment Objective

The objective of the China A Fund is to achieve long-term capital appreciation by investing primarily in mainland China’s capital markets. The China A Fund seeks to achieve its investment objective by mainly investing (i.e. not less than 70% of its net assets) in companies listed on the A-Share markets of the Shanghai Stock Exchange and/or the Shenzhen Stock Exchange.

Performance Review as of 30 June 2021*:

Share Class AA (From 1 July 2020 to 30 June 2021) 33.60%

Benchmark** (From 1 July 2020 to 30 June 2021) 37.35%

Source: Manulife Investment Management (Hong Kong) Limited

Portfolio Review

The sub-Fund has underperformed the benchmark over the past twelve-month period ending 30 June 2021. Asset allocation decisions added value while stock selection offset part of the gains. At the sector level, stock selection in industrials and materials contributed the most positively while consumer discretionary and healthcare hurt performance. The overweight to materials and industrials and the underweight to financials added value to performance. Partly offsetting the outperformance was the underweight to healthcare.

The sub-Fund’s exposure to the industrial sector was the main contributor to the performance. The sub-Fund’s holding in a leading industrial robot maker was a key contributor. The company reported a solid set of first quarter 2021 results with revenue and net profit growth over 77% and 95% year-on-year. The company has been gaining market share in both domestic and overseas markets thanks to its clear focus on high quality robotic products. Another contributor was the sub-Fund’s holding in a leading lithium battery separator manufacturer. The stock continued to enjoy re-rating after a robust set of first quarter 2021 results and the announcement of a management incentive programme.

On the detractor side, the sub-Fund’s holding in a pharmaceutical glass manufacturer faced profit-taking pressure. The company manufactures a variety of glass products for pharmaceutical uses such as testing tubes and injection bottles. The company reported a 20% growth in net profit for the first half of this year but had not seen further re-rating after the vaccination rollout. Another detractor was a leading domestic condiment manufacturer. Despite solid net income growth of over 40% in the second quarter, the stock retreated in the month after a strong run year-to-date. We remain positive on the company’s growth outlook and believe its product premiumisation strategy will continue to play out.

* The performance return is calculated in class base currency and includes dividends re-invested.** The return represents the performance of 70% CSI 300 Index + 30% MSCI Zhonghua Index until 9 February, 2011 and

thereafter CSI 300 Index.


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Portfolio Review (continued)

During the period, the sub-Fund has added more exposure to industrials and information technology in order to capture domestic driven growth in automation and manufacturing upgrades. The sub-Fund reduced exposure in consumer discretionary and healthcare given the limited valuation upside from further re-rating. At period-end, the industrials sector was the largest overweight with financials being the largest underweight.

Market Review

Chinese equities moved higher for the past year, amid high market volatility. In the second half of 2020, Chinese equities climbed on the back of the healthy economic rebound and positive corporate earnings. On the economic front, third-quarter gross domestic product (GDP) came in at 4.9% year-on-year. Monthly economic data releases in the lower half of the year also showed a broad-based rebound on both the demand and supply side. Industrial profits and manufacturing fixed asset investments continued to point to solid expansion of industrial and services activity.

Turning to 2021, Chinese equities moved marginally lower for the first quarter on the back of positive economic indicators. In the second quarter, Chinese equities rose on strong first-quarter earnings. Chinese equities rebounded further from mid-May and the effect of style rotation from growth to value seemed to diminish. Towards quarter-end, growth-related China A-shares represented by the ChiNext and STAR 50 indices regained momentum while offshore Chinese equities showed diverged performance across sectors.

Capital flow wise, the Northbound Stock Connect Programme continued to register net inflows for the month albeit at a slower pace. Foreign ownership in A-shares had risen to an all-time high of 4.5%, up from 3.6% at end of 2019, and tripled the 1.5% in 2014 when Stock Connect was inaugurated.

On the policy front, the government released the initial details of the 14th Five-Year Plan (2021-2025), which will focus on boosting domestic consumption and accelerating technological development in key industries. At the macro level, the market’s focus remained on the country’s Two Sessions (i.e. congress meetings) held in March 2021 where the GDP growth target was stated at above 6% for 2021. Key policy directives on growth and sustainability topics were released with an emphasis on carbon neutral ambitions by 2060.

Investment Manager's Report (continued) for the year ended 30 June 2021

MAF China A Segregated Portfolio (the “China A Fund”) (continued)


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MAF China A Segregated Portfolio (the “China A Fund”) (continued)

Outlook

In 2021, we expect the performance of China A-shares to be more balanced across sectors and styles. We expect market volatility may remain in the near-term. In the near-team, we are focusing on companies which have product differentiation and pricing power in order to pass on cost inflation.

With China having laid out a clear path towards a more internally-driven economy, we see opportunities in technology, industrial upgrades and the consumer sectors. On the technology front, we anticipate more home-grown innovation in areas like technology supply chains. These efforts will likely be bolstered by additional fiscal and policy support, such as tax incentives and low-cost funding to boost local research and development and reduce the reliance on imports. Electric vehicle (EV) development is another attractive theme, backed by both domestic demand and the local industry’s increasing presence in the global EV supply chain.

We continue to focus on under-researched ideas with solid growth outlooks and to tap into unique investment opportunities that do not exist in the offshore universe. We believe the index inclusion of mid cap stocks will continue to broaden and deepen global investor interest in this segment.


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* The performance return is calculated in class base currency and includes dividends re-invested.** The return represents the performance of 70% Shanghai T-bond Index + 30% short end cash rate until 23 February 2011.

From then until 31 December 2013, it represents Shanghai T-bond Index, from 1 January 2014 until 30 April 2016, it represents HSBC China Local Currency Government Bond (1-10 years) Index , from 1 May 2016 to 30 September 2020, it represents Markit iBoxx ALBI China Onshore 1-10 Index, and thereafter Markit iBoxx ALBI China Onshore Bond Index.


MAF Renminbi Bond Segregated Portfolio (the “Bond Fund”)


The objective of the Bond Fund is to provide capital appreciation and income generation by investing primarily in RMB–denominated debt instruments issued and listed in Mainland China or traded in the Mainland China interbank bond market, in accordance with applicable QFII regulations. The Bond Fund invests primarily (i.e. not less than 70% and up to 100% of its of its net assets) in RMB–denominated debt instruments, including convertible bonds, that are listed or transferred on either the Shanghai Stock Exchangeor the Shenzhen Stock Exchange, or interbank bonds, and which are issued by the Mainland China Government as well as corporations in Mainland China.


Share Class AA (USD) (From 1 July 2020 to 30 June 2021) 10.42%

Share Class I (USD) (From 1 July 2020 to 30 June 2021) 10.69%



Portfolio Review

The portfolio detracted over the period. The portfolio’s overweight exposure to corporate bonds was a contributor to returns primarily due to higher carry, however, this was offset by the portfolio’s small exposure to Chinese yuan (offshore) which marginally underperformed Chinese yuan (onshore) over the period.


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MAF Renminbi Bond Segregated Portfolio (the “Bond Fund”) (continued)

Market Review

China’s first quarter 2021 gross domestic product (GDP) growth was marginally below expectations at 18.3% year-on-year, due to the favourable base effect, following 6.5% year-on-year growth in the fourth quarter of 2020. The Caixin Manufacturing Purchasing Managers’ Index (PMI) eased from 53 at the beginning of the year but generally remained stable and above 50, showing expansionary activity, and finished the period at 51.3 at the end of June. The lower PMI readings since the beginning of the year suggested that growth momentum in the domestic economy was moderating over the period as further waves of the Covid-19 virus and tighter pandemic control measures globally took effect on the economic recovery. June exports (US dollar terms) grew by 32.2% year-on-year and imports grew by 35.7% year-on-year. The trade balance was US$51.53 billion compared with US$46.42 billion at the beginning of the period. China’s export activity over the period has been resilient with the outlook for solid external demand remaining intact. May industrial production grew by 8.8% year-on-year while May retail sales grew by 12.4% year-on-year, with both indicators below market expectations. The weaker than expected consumption recovery so far can be attributable to a number of factors including higher mobility restrictions due to the pandemic and the recovery to household income lagging GDP growth. June consumer price index (CPI) inflation increased to 1.1% year-on-year, indicating that CPI was relatively contained as food prices continued to decline. On the other hand, June producer price index inflation accelerated to 8.8% year-on-year and continued to be impacted by the rally in commodity prices over the first half. Aggregate finance was 3.67 trillion Chinese yuan at the end of June while new yuan loans increased by 2.12 trillion Chinese yuan, both above expectations. China’s foreign reserves stood at US$3.214 trillion at the end of June.

China’s 2021 government work report, released during the first half, has set the 2021 growth target at “above 6%”, placing an emphasis on reform, innovation and high-quality growth. The fiscal deficit target has also been lowered to 3.2% of GDP from 3.6% in 2020 with the overall government bond issuance quota lowered to 7.22 trillion yuan. M2 and total social financing growth is expected to be kept consistent with GDP growth. The targets outlined in the government work report point to a normalisation of macroeconomic policy with an emphasis on stability and sustainability. In March, FTSE Russell confirmed the inclusion of Chinese government bonds in the widely followed WGBI index from October 2021. This should see continued demand for Chinese bonds from global investors and flows into the China bond market in the months ahead. Throughout this period, monetary policy has also remained stable with the People’s Bank of China (the "PBOC") leaving policy rates unchanged.

The 10-year Chinese government bond yield increased from 2.85% to 3.09% over the year. The Chinese yuan appreciated from 7.06 to 6.46 against the US dollar over the period. China’s onshore bonds continued to be supported by inflows from foreign investors over the period which has helped support the renminbi against the US dollar over the period. The Markit iBoxx ALBI China Onshore Total Return Index returned 12.48% in US dollar terms over the period.


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MAF Renminbi Bond Segregated Portfolio (the “Bond Fund”) (continued)

Outlook

The latest economic data from China in June remained mixed with market expectations gradually shifting to likely slower economic growth in the second half of this year. Monetary policy remains stable with the PBoC continuing to communicate its neutral policy stance while managing the market’s expectations that short-end rates remain the key tool in managing market liquidity. One of the key market risks is that the US dollar will continue to strengthen from current levels after the US dollar/Chines yuan has been trading higher after testing the 6.20 level. The next resistance level is 6.50 for the US dollar/Chinese yuan. So far, the currency has remained within this range. If Asian growth continues to lag against the US growth-rate then the US dollar should continue to be supported with the US Federal Reserve Board embarking on a path to reduce its asset purchase programme as early as the end of 2021 and potential rate hikes starting in 2023. With respect to the Chinese yuan, it will likely remain supported by China’s relatively attractive interest rates and stable monetary policy while index inclusion and fund flows into Chinese assets will also help offset the factors driving US dollar strength. Overall, the Chinese yuan is expected to remain stable and to continue within its trading range against other major currencies.


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Investment Manager's Report (continued) for the period ended 30 June 2021

MAF Asia Pacific Income and Growth Segregated Portfolio(the “Asia Pacific Income and Growth Fund”)


The investment objective of the Asia Pacific Income and Growth Fund is to provide income and capital appreciation over the medium to longer term by investing primarily in equity and fixed income–related securities in the Asia Pacific ex–Japan region. The Asia Pacific Income and Growth Fund targets an asset allocation of 60% in equity securities and 40% in fixed income securities in that region. However the Asia Pacific Income and Growth Fund may hold between 25% and 75% in either equity securities or fixed income securities in that region in pursuance of its investment objective.


Share Class AA (USD) Inc (From 1 July 2020 to 30 June 2021) 12.02%



Portfolio Review

As the sub-Fund’s focus is on generating sustainable income, the market rally driven by the post Covid-19 economic recovery led to a detraction in the sub-Fund. During the reporting period, the sub-Fund detracted on the back of stock selection and asset allocation decisions at the country and sector level. Stock selection in China was the primary detractor to performance as growth-oriented Chinese companies in the technology and healthcare sector rallied. Partially offsetting the detraction was stock selection in South Korea and Taiwan and the overweight to Taiwan and underweight to China.

The primary performance detractors were telecommunication and defensive infrastructure names in Hong Kong and China. As expectation of cyclical growth picked-up in the second half of 2020, traditionally defensive and income-oriented sectors underperformed the broader market. The fundamental outlook of these companies remains unchanged, and we believe that the ability to pay a consistent dividend and grow the dividend remains intact.

Contributing strongly was the sub-Fund’s Taiwan technology exposure as the overweight added significant value. One of the world’s largest semiconductor foundries, this Taiwanese company performed well after reporting strong second quarter earnings and is also seen to be one of the primary beneficiaries of an outsourcing opportunity from one of the world’s largest semiconductor manufacturers due to a delay in the ramp up of production. Also contributing positively to performance was the sub-Fund’s holding in a South Korean memory and smartphone manufacturer on the back of improved outlook for memory pricing, market share gains, and the expectations of an improving shareholder return policy moving forward. The company’s operational performance continues to fire on all cylinders across multiple businesses, all of which provides the company with multiple earnings catalysts for 2021.

Over the period, the portfolio’s overall security selection contributed to performance with US dollar-denominated holdings of an Indian agrochemical manufacturer and a Chinese property developer being the outperformers. In addition was the underweight US dollar interest rate duration as US Treasury yields rose. There were no significant detractors.

* The performance return is calculated in class base currency and includes dividends re-invested.** The return represents the performance of 60% MSCI AC Asia Pacific ex Japan Index + 40% JP Morgan Asia Credit Index.


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MAF Asia Pacific Income and Growth Segregated Portfolio(the “Asia Pacific Income and Growth Fund”) (continued)

Market Review

Asia-Pacific ex Japan equity markets moved higher during the period which started with a raft of better-than-expected third quarter technology earnings in the US and Europe, as well as dovish monetary policy and robust fiscal stimulus. In late August, the US Federal Reserve Board (Fed) introduced a new policy framework that empowers the central bank to allow inflation above the current 2% target for a sustained period before increasing interest rates, which markets broadly interpreted as a signal of “lower for longer” interest rates that fuelled bullish sentiment. In September, many Asian markets followed developed markets lower on a cocktail of worries: rising US-China tensions, a potential contested US presidential election in November, and stalled fiscal stimulus in key markets. The US presidential election took centre stage in November with the election of Joe Biden and a split US Congress. The result triggered risk-on sentiment that spurred capital inflows to emerging markets and Asia, with many lagging ASEAN markets posting banner months. In December, markets rose on the back of numerous positive catalysts such as the beginning of the Covid-19 vaccination rollout in many countries, the US Congress passing a US$900 billion stimulus bill, and the United Kingdom reaching a last-minute Brexit deal with the European Union. To start the new year, in February and March, yields surged in the US as President Biden signed into law a US$1.9 billion fiscal package and proposed an additional US$3 billion in infrastructure spending. As a result, investors rotated into value names from growth as markets priced in a post-pandemic macroeconomic environment of increased economic growth and inflation. During the second quarter, global markets were influenced by two developments: 1) investor optimism over the economic reopening and improving vaccination rates in developed economies, while outbreaks continued in markets with lower vaccination rates; and 2) debate over whether above-trend inflationary pressures in some markets may be transitory in nature. In June, the Fed gave an unexpectedly hawkish statement, as a majority of the Federal Open Market Committee (FOMC) members believed two rate hikes would occur in 2023 – earlier than market consensus.

US Treasury yields rose over the period on the back of fiscal packages by the Biden administration, Covid-19 cases stabilising, the vaccine rollout and generally positive economic data. After passing a US$900 billion relief bill in December, the Biden administration passed a US$1.9 trillion fiscal package in March. On the economic data front, US gross domestic product (GDP) rebounded following a contraction in the second quarter of 2020 while first quarter 2021 GDP growth posted at 6.4% (first estimate, annualised, quarter-on-quarter), while the headline consumer price index rose by 5% year-on-year in May, hitting the highest monthly gains since 2008. At the June FOMC meeting, the Fed was generally viewed as hawkish as they hinted at a higher likelihood of rate hikes. Post-Fed meeting, Treasury yields retraced to lower levels after Fed officials eased inflation fears and expected inflationary pressure to be transitory. Over the period, the 10-year Treasury yield rose to 1.47% from 0.66%. Asian credit markets posted positive returns due to tightened credit spreads and positive carry, offsetting the higher US Treasury yields. The Asian high-yield corporate segment outperformed Asian investment grade credit over the period; the JP Morgan Asian Investment Grade Corporate Bond Index increased by 2.40%, while the JP Morgan Asian High Yield Corporate Bond Index increased by 7.85% in US dollar terms. The US administration expanded investment bans on Chinese companies and provided more clarity to investors in terms of coverage, though the new list was mostly in line with the previous one. In Malaysia, S&P affirmed its A- sovereign rating and maintained a negative outlook due to renewed Covid-19 cases, though it did not induce significant price action.


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Outlook

Despite global equity market valuations looking elevated relative to history, low absolute interest rates and somewhat depressed earnings need to be kept in mind with multiples looking far more reasonable several years out. Asian equities continue to trade at a reasonable discount to global markets and we anticipate

strong double-digit earnings recovery in 2021. Although 10-year bond yields have risen since the start of the year, equity dividend yields continue to look attractive compared to bond yields. We see scope for further reductions in valuation dispersions between high price-earnings growth stocks and stocks that have attractive yields as we enter a period of global economic recovery as vaccinations take hold across the region and around the world.

The strength in the anticipated economic recovery has led us to favour more cyclical yields such as within materials and ports for instance. The consumer spending recovery is also prompting us to increase our allocation towards the consumer discretionary sector particularly those who also have solid long-term growth prospects. Bond proxy equities are less favoured compared to last year given the recent steepening in the yield curve. Although real estate investment trusts can be considered as bond proxies, we maintain a strong allocation as a source of yield although we favour trusts that benefit from a reopening post-Covid lockdowns such as retail commercial trusts. We also continue to see strong value in many expressway companies which are seeing a dramatic increase in traffic post-Covid. Many companies we like that offer robust growth at a reasonable yield continue to be within the Taiwanese information technology sector which continues to benefit from ongoing chip shortages and ongoing structural growth profiles with solid cash flows and generous dividend payout ratios.

We continue to hold several exposures within the banking sector. The steepening yield curve together with our view that many regional property markets should see a recovery in activity should lead to stronger earnings fundamentals. In terms of growth sectors, we see some value emerging back into the Chinese e-commerce sector which has corrected due to the anti-monopoly campaign. Compared to a few months ago, there is a lot more clarity on what the earnings impact would be from fines and alterations to business practices. Overall, the earnings growth profile continues to look attractive at much lower valuations.

Given the growth recovery scenario and somewhat elevated inflation expectations, we prefer equities over fixed income at this point. Within fixed income, the focus remains on yield extraction through credit opportunities within the high-yield space while maintaining shorter duration profiles.


MAF Asia Pacific Income and Growth Segregated Portfolio(the “Asia Pacific Income and Growth Fund”) (continued)


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The investment objective of the U.S. Bank Equity Fund is to achieve medium to long term growth of capital primarily through investing in equities and equity-related investments of U.S. banks. The U.S. Bank Equity Fund (i) shall invest at least 80% and up to 100% of its net assets in (a) equity securities of U.S. banks, such as publicly traded common, preferred and convertible preferred stocks; and (b) other U.S. banks focused equity-related investments such as American depositary receipts, European depositary receipts, global depositary receipts and ETFs; (ii) may invest up to 20% of its net assets in equity securities of other U.S. and foreign financial services companies and/or in cash, short term securities and money markets instruments such as bank deposits, certificates of deposits, discount notes, treasury and agency debt, or collateralised and/or securitised products; and (iii) may invest up to 5% of its net assets in equity securities of companies outside the financial services sector.



Share Class AA (HKD) Inc (From 1 July 2020 to 30 June 2021) 70.13%



Portfolio Review

The fund underperformed its benchmark during the period.

A Phoenix, Arizona headquartered was a relative outperformer as the bank’s stock price increased significantly as the economy rebounded from the lock downs in 2020. The bank’s hospitality loan portfolio recovered faster than expected and has experienced minimal credit losses. Additionally, the bank generated above peer loan growth which also bolstered its shares.

Another outperformer is a Santa Clara, California headquartered bank with a major presence to Silicon Valley. This bank’s technology focused customers thrived during the pandemic which led to exceptional deposit growth. Additionally, the bank realized warrant gains as several its customers tapped the equity markets bolstering its profitability.

A Louisville, Kentucky based bank was a laggard after holding up better going into the beginning of COVID-19 downturn in the first half of 2020. This regional bank is a conservative underwriter with a strong trust business and we continue to own its shares.

Likewise, a Novato, California based regional bank also underperformed. This bank is another historically conservative underwriter whose shares held up relatively well earlier in the pandemic and lagged over the course of the year. The bank also announced the acquisition of another California based bank, which is also a holding of the Fund. The accretive transaction is strategically compelling and we continue to hold both banks.


MAF U.S. Bank Equity Segregated Portfolio(the “U.S. Bank Equity Fund”)

* The performance return is calculated in class base currency and includes dividends re-invested.** The return represents the performance of S&P Composite 1500 Banks Index.


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MAF U.S. Bank Equity Segregated Portfolio(the “U.S. Bank Equity Fund”) (continued)

Market Review

U.S. stocks posted a stellar advance for the year ended June 30, 2021, as massive federal government stimulus and the rollout of highly effective COVID-19 vaccines boosted prospects for economic recovery. Added tailwinds came from healthy corporate earnings and the resolution of the November presidential election. As the period progressed, mounting optimism around the economy and the possibility Congress would pass a bipartisan infrastructure spending bill further encouraged investors. These tailwinds far outweighed volatility brought on by unrest at the Capitol last January, regional virus surges and, later in the period, the spread of the new more infectious Delta variant of COVID-19. Inflation fears also intermittently weighed on returns.

For the 12-month period, secularly driven growth stocks and economically sensitive value stocks delivered very similar returns across the broader market. Smaller-capitalization stocks, which tend to be more levered to the economy’s direction, outperformed their larger-capitalization peers, with small-cap value stocks delivering the strongest gain by far.

Within the broad-based S&P 500 Index, the financials sector posted the most notable advance, buoyed by the prospect that an economic recovery would boost loan demand and the possibility of higher interest rates. In addition, rising equity markets bolstered assets under management. The economically sensitive industrials, energy, and materials sectors also were very strong performers. Lastly, the communication services sector notched an outsized gain, as many of the products and services these companies offer remained in high demand. No sectors posted a decline for the period. The biggest laggard was the more-defensive utilities sector, which nevertheless posted an above-average return.

U.S. Bank stocks outperformed the broader market in this environment. The fund’s benchmark, the S&P Composite 1500 Banks Index, increased 75.92% for the period.


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MAF U.S. Bank Equity Segregated Portfolio(the “U.S. Bank Equity Fund”) (continued)

Outlook

Given the strength of the U.S. banking system today, we believe that U.S. banks will continue to provide support to the U.S. economy as businesses recover from the pandemic. This is drastically different from the Global Financial Crisis when banks were at the root of the economic problems. Today, U.S. banks are fundamentally strong, extremely well capitalized and have ample liquidity to support their customers.

As the economy continues its process of re-opening, we’ve seen a wind down of the loan payment deferrals that banks granted many customers―temporary relief known as forbearance. Additionally, the most recent stimulus packaged that was approved in late March should support the economy and reduce credit costs further.

Another major factor that will benefit banks heading into the second half of the year was the positive results from the latest Fed CCAR stress test. The Federal Reserve’s temporary restrictions on dividends and the amount of stock repurchases ended on June 30th allowing for additional capital return in the second half of the year.

Meanwhile, operating efficiency for banks continues to improve. As these trends continue, we expect U.S. banks’ 2021 earnings to rebound from 2020 levels where banks established significant credit reserves in the first half of the year.

U.S. banks remain undervalued relative to its history and relative to the overall market. They are fundamentally strong with historically high levels of capital and liquidity, which will allow them to provide support to their customers. M&A activity, which slowed during the pandemic as banks focus on their customers, has restarted with several notable transactions and we expect this will continue throughout 2021.


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MAF Greater Bay Area Growth and Income Segregated Portfolio (the “Greater Bay Area Growth and Income Fund”)


The investment objective of the Greater Bay Area Growth and Income Fund is to achieve capital growth and income generation by investing primarily in a diversified portfolio of equity and equity-related securities and fixed income securities of issuers which are connected to the region comprising Hong Kong, Macau and the Guangdong Province of China (“Greater Bay Area”). The Greater Bay Area Growth and Income Fund shall invest at least 70% of its net assets in equity and equity-related securities (which are listed on any stock exchange) and fixed income securities of governments or corporate issuers established and/or with substantial business interests in the Greater Bay Area. Equity and equity-related securities include common stocks, preferred stocks, depositary receipts and real estate investment trusts.


Share Class AA (USD) (From 1 July 2020 to 30 June 2021) 15.31%


Class AA (AUD) Inc Hedged (From 1 July 2020 to 30 June 2021) 14.22%

Class AA (HKD) Inc (From 1 July 2020 to 30 June 2021) 15.55%


Portfolio Review

During the reporting period ending 30 June 2021, the sub-Fund’s equity exposure increased alongside the broader Chinese and Hong Kong equity markets. Positive returns mainly came from almost all sectors led by industrials, financials, and communication services. Partly offsetting the gains was the utility sector.For the equity portion, within the sub-Fund’s key investment themes, the sub-Fund’s exposure in electric vehicle supply contributed the most to positive performance. The key contributor was a leading Chinese electric vehicle (EV) brand. The company reported an inline set of third quarter results with sequential uptrend for both revenue and attributable profits. Management further guided a positive earnings outlook for the coming quarter, thanks to the positive feedback from its own newly launched key EV model. Another contributor was a battery manufacturer focused on EV use. The company enjoyed robust demand from domestic and global EV brands and the stock continued to be re-rated for its growth potential.On the detractor side, the key detractor was a manufacturer for instant noodles and premium food. The stock retreat on concerns of margin pressure from rising palm oil prices and keen competition from domestic premium brands. We had switched out from the stock for better opportunities in the consumer staples sector. Another detractor was a medical services provider focused on assisted fertility treatments. The company’s overseas centre was adversely affected by the lockdown where patient traffic was down significantly.

* The performance return is calculated in class base currency and includes dividend re-invested. There is no representative benchmark for this sub-fund.


16


MAF Greater Bay Area Growth and Income Segregated Portfolio (the “Greater Bay Area Growth and Income Fund”) (continued)

Portfolio Review (continued)

On the fixed income side, security selection and asset allocation were positive contributors to returns over the period. The portfolio’s overweight to corporate bonds helped performance due to positive returns from credit spreads declining over the period and from positive carry. Holdings that outperformed included a Chinese investment grade-rated property developer and a long-dated bond for a leading Hong Kong conglomerate.

Market Review

Chinese equities moved higher for the past year amid high market volatility. In the second half of 2020, Chinese equities got a boost on the back of the healthy economic rebound and positive corporate earnings. Turning to 2021, Chinese equities moved marginally lower for the first quarter on the back of positive economic indicators. In the second quarter, Chinese equities rose on strong first-quarter earnings. Chinese equities rebounded further from mid-May and the effect of style rotation from growth to value seemed to diminish. Towards quarter-end, growth-related China A-shares represented by ChiNext and STAR 50 indices regained momentum while offshore Chinese equities showed diverged performance across sectors. Hong Kong equities also moved higher during the year thanks to an improving economic outlook. Retail sales growth returned to positive territory towards period-end and the unemployment rate continued to decrease.

On the policy front, economic activity in the Greater Bay Area (GBA) region remain robust. The Chinese government released the initial details of the 14th Five-Year Plan (2021-2025), which focused on boosting domestic consumption and accelerating technological development in key industries. The key directives for the GBA following President Xi’s visit to Shenzhen in October 2020 was also released, with continued emphasis on cultivating innovation and enhancing interconnectivity in the region. In Hong Kong, the Annual Policy Address released in April 2021 emphasised deepening integration of the GBA and infrastructure spending to enhance the GBA’s connectivity including acquiring an additional stake in Zhuhai Airport, which was confirmed in the budget. Implementation details of the GBA’s pilot wealth connect programmes were released in May where qualified GBA residents will be allowed to buy eligible wealth management products on the other side. The policy tailwind fostering the GBA’s development continues to contrast with the tighter regulations on the national level in selective sectors such as the internet, e-commerce and education.

The JP Morgan China Investment Grade Total Return index increased by 1.19% in US dollar terms over the period. China’s investment grade corporate bonds posted positive returns over the year as credit spreads narrowed and offset the rise to US interest rates over the period. China’s credit spreads narrowed over the period to 3.48% from 3.89% based on the JP Morgan China blended spread index. As the global economic outlook improved since the fourth quarter of 2020, the US Treasury yield increased from 0.66% to 1.47% over the period. Chinese investment grade corporate bonds generally benefited from the improving economic outlook and improved global investor sentiment heading into the end of the first quarter. Since the end of March, investor sentiment around Chinese credit has deteriorated due to idiosyncratic issues on individual companies which impacted individual credits in China’s state-owned enterprise and property sectors. While Chinese investment grade credit remained relatively resilient, Chinese high-yield bonds faced greater pressure towards the end of the period amid market concerns over policy tightening measures directed at the property sector.


17


MAF Greater Bay Area Growth and Income Segregated Portfolio (the “Greater Bay Area Growth and Income Fund”) (continued)

Outlook

Looking ahead, we believe the regional focus of the sub-Fund continues to provide differentiated exposure to investors, thanks to our niche investment universe that focuses on regional champions with their own growth dynamics which are not overshadowed by nationwide giants.

On the equity side, the sub-Fund’s four key investment themes remain intact. Sector-wise, we are looking to increase allocation to financials sectors which are the key beneficiaries of the upcoming GBA Wealth Connect Programme. We are also keen to add exposure in quality industrial companies that fit into the infrastructure and innovation investment themes of the sub-Fund. For the internet sector, we remain cautious of the regulatory headwinds on antitrust and cybersecurity issues and will have limited exposure on mega internet and e-commerce companies and await further clarity on the issues.

On the fixed income side, we continue to be invested across a diversified range of sectors to buffer against potential geopolitical risks even though Covid-19 risk appears to be gradually declining. In terms of sector tilt, we maintained exposure to the property sector which continues to provide better risk-reward opportunities in the GBA-related universe. We have also sought opportunities to selectively invest into rare, high-yield non-property sector names with strong fundamentals. We have maintained portfolio duration to around four years given the potential for interest rates to move higher. In view of the current spread levels which are getting closer to historical tights, we are more conservative in our exposure especially on high grade but continue to actively seek opportunities in GBA-related names with quality and attractive relative value.

The sub-Fund's strategy will continue our current stances of (1) keeping adequate portfolio diversification aiming at 70/30 split between equity/fixed income to capture both capital appreciation and stable dividend/interest income, (2) targeting specific stock opportunities within the key GBA investment themes within equities. The objective is to provide investors with a steady total return at low volatility, especially during times of market swings.


18

Report of the Custodian

In our opinion, the Investment Manager, Manulife Investment Management (Hong Kong) Limited, has, in all material respects, managed the Manulife Advanced Fund SPC for the year ended 30 June 2021 in accordance with the provisions of the constitutive documents and the Memorandum and Articles of Association dated 14 July 2008, as amended.

For and on behalf of Citibank Europe plc, Luxembourg Branch

Date: 21 October 2021

Muriel ICARDVice President

Date: 21 October 2021

Pascal KOHLDirector

A member firm of Ernst & Young Global Limited

19

Independent Auditors’ Report

The Board of Directors Manulife Advanced Fund SPC Report on the Audit of the Financial Statements

Opinion

We have audited the financial statements of Manulife Advanced Fund SPC and each of its segregated portfolios, comprising China A Segregated Portfolio, Renminbi Bond Segregated Portfolio, Asia Pacific Income and Growth Segregated Portfolio, U.S. Bank Equity Segregated Portfolio and Greater Bay Area Growth and Income Segregated Portfolio (collectively, the “Company”) which comprise the statement of financial position as at 30 June 2021, and the statement of comprehensive income, statement of changes in net assets attributable to holders of redeemable participating shares, statement of changes in equity, statement of distribution and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of Manulife Advanced Fund SPC and each of its segregated portfolios, comprising China A Segregated Portfolio, Renminbi Bond Segregated Portfolio, Asia Pacific Income and Growth Segregated Portfolio, U.S. Bank Equity Segregated Portfolio and Greater Bay Area Growth and Income Segregated Portfolio as at 30 June 2021 and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

Report on Other Legal and Regulatory Disclosure Requirements

We report that the financial statements have been properly prepared in accordance with the relevant disclosure provisions of the Memorandum and Articles of Association of the Company and the disclosure requirements of Appendix E of the Code.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code) and we have fulfilled our other ethical responsibilities in accordance with the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Ernst & Young Ltd. 62 Forum Lane Camana Bay P.O. Box 510 Grand Cayman KY1-1106 CAYMAN ISLANDS

Tel: +1 345 949 8444 Fax: +1 345 949 8529 ey.com

19


20

Other Information

Other information consists of the Company Information, Director’s Report, Investment Manager’s Report, Report of the Custodian, Portfolio of Investments, Statement of Movements in Investment Portfolios, Performance Table and Information on Exposure arising from Financial Derivative Instruments. Management is responsible for the other information.

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

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and the Board of Directors for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with International Financial Reporting Standards, the relevant disclosure provisions of the Memorandum and Articles of Association of the Company and the relevant disclosure requirements set out in Appendix E to the Hong Kong Code on Unit Trusts and Mutual Funds of the Securities and Futures Commission of Hong Kong (the “Code”), and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

The Board of Directors is responsible for overseeing the Company’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Financial Statements

Our report is made solely to you, as a body, and for no other purpose. We do not assume responsibility towards or accept liability to any other person for the contents of this report.

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

20


21

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

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

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

- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

- Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on Manulife Advanced Fund SPC and each of its segregated portfolios, comprising China A Segregated Portfolio, Renminbi Bond Segregated Portfolio, Asia Pacific Income and Growth Segregated Portfolio, U.S. Bank Equity Segregated Portfolio and Greater Bay Area Growth and Income Segregated Portfolio ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.

- Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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

21 October 2021

21

Man

ulife

Adv

ance

d Fu

nd S

PC

22

Stat

emen

t of F

inan

cial

Pos

ition

As

at 3

0 Ju

ne 2

021

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

Notes

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

Asse

tsFin

ancia

l asset

s at co

st34

,615,8

5834

,424,3

8439

,624,4

1330

,617,5

1515

,561,7

5314

,880,5

0625

,197,2

4226

,760,7

0329

,980,1

4510

,518,0

6214

4,979

,411

117,2

01,17

0Un

realise

d app

reciati

on/(d

eprec

iation

)10

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606,0

38,11

0 3,

142,0

79

(774

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2,539

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381,8

90 3,

639,8

20

(8,44

9,868

)29

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96

(2,07

0,299

)Fin

ancia

l asset

s at fa

ir valu

e thro

ugh p

rofit o

r loss

3, 4

44,95

5,118

40,46

2,494

42,76

6,492

29,84

3,398

18,10

1,422

15,26

2,396

28,83

7,062

18,31

0,835

30,27

6,113

11,25

1,748

164,9

36,20

711

5,130

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Cash

and c

ash eq

uivale

nt5

184,4

2017

1,854

228,3

0513

3,007

66,31

465

3,268

652,5

8744

7,270

1,378

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345,8

192,5

10,11

71,7

51,21

8Re

ceivab

le on s

ubscr

iption

s18

3,070

14,08

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6,131

542,8

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7,142

51,21

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801,4

4168

4,493

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vable o

n Man

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ent S

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l8

––

––

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100

100

Other

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ables

and p

repaym

ents

66,8

8395

759

4,769

398,7

9425

5,352

185,2

5049

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32,45

126

7,907

139,4

591,1

73,91

175

6,911

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rom br

okers

2.2 (I)

––

161,6

20

– 40

6,415

4,

249

– 18

,555

210,2

9950

,240

778,3

3473

,044

Total

asse

ts45

,329,4

9140

,649,3

8543

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8630

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9918

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6316

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9430

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4219

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5332

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2811

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1,314

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7,864

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719

1,873

170,2

6774

8,228

687,4

3311

7,959

47,32

577

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58,90

262

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70,42

91,1

97,58

91,0

34,35

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31,50

532

4,717

58,49

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3,924

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5,173

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18,80

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1,431

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1,937

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deem

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Partic

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44,10

6,113

40,15

4,401

41,87

2,487

29,47

3,842

18,32

8,590

16,00

6,150

29,06

2,738

19,20

1,712

31,30

9,026

11,62

2,975

164,6

78,95

411

6,459

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Man

ulife

Adv

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d Fu

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PC

23

Stat

emen

t of F

inan

cial

Pos

ition

(con

tinue

d)

Num

ber o

f sha

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sue

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quity

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ter Ba

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th an

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ome F

und

Mana

geme

nt Sh

are30

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

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2021

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20

Mana

geme

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are–

– –

– –

– –

– –

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2,816

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1,630

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3,935

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– –

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280,5

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– –

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Net

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geme

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y30

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2021

30 Ju

ne 20

2030

June

2021

30 Ju

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2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

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2021

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2030

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30 Ju

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20

Mana

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D–

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1.000

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A (US

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.2354

12.15

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12.30

72–

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.9492

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– Cl

ass A

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7.415

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(USD

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14.05

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– –

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D–

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– 9.1

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8.277

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.3436

9.338

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– Cl

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A (HK

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D–

– –

– –

– –

– 92

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– –

– Cl

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A (HK

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D–

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– 96

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85.94

8612

5.511

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107.3

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CAD

– –

– –

9.089

68.1

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– –

– –

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The

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.

Man

ulife

Adv

ance

d Fu

nd S

PC

24

Stat

emen

t of C

ompr

ehen

sive

Inco

me

For t

he y

ear e

nded

30

June

202

1

China

A Fu

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nd Fu

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ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

Notes

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

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e yea

r en

ded 3

0 Jun

e 20

20

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e yea

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ded 3

0 Jun

e 20

21

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e yea

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ded 3

0 Jun

e 20

20

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e yea

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ded 3

0 Jun

e 20

21

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e yea

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ded 3

0 Jun

e 20

20

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e yea

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ded 3

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e 20

21

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e yea

r en

ded 3

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e 20

20

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e yea

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ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

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e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DInc

ome

Divide

nd inc

ome

958

4,166

533,5

93–

– 43

8,618

44

0,571

75

4,653

87

2,638

34

6,763

24

5,832

2,

124,2

00

2,09

2,634

Inte

rest in

come

1044

22,2

551,4

25,14

21,4

09,46

832

1,316

313,6

60–

– 21

2,365

34

5,017

1,

959,2

65

2,07

0,400

Oth

er inco

me10

54,86

736

,059

20,49

5 44

,971

74

– 21

–

231

– 75

,688

81,03

0 Ne

t gains

/ (loss

es) on

financ

ial ass

ets an

d liab

ilities a

t fair v

alue th

rough

profit o

r loss

312

,875,1

59 10

,068,8

53

2,86

0,948

(7

12,75

0) 2,

326,6

35

(1,00

6,853

) 12

,684,6

42

(5,35

2,646

) 1,

878,7

65

1,06

4,198

32

,626,1

49

4,06

0,802

Ne

t foreig

n exch

ange g

ains /

(losses

)2.2

(F)

9,22

7 (3

8,702

) (1

8,353

) (2

8,490

) 29

5,077

(1

17,23

4) (2

,143)

(12,3

45)

(61,8

90)

(123

,364)

221,9

18

(320

,135)

Total o

peratin

g incom

e 13

,523,8

61

10,60

2,058

4,

288,2

32

713,1

99

3,38

1,720

(3

69,85

6) 13

,437,1

73

(4,49

2,353

) 2,

376,2

34

1,53

1,683

37

,007,2

20

7,98

4,731

Expens

esMa

nagem

ent fee

s12.

1, 16

(732

,355)

(700

,226)

(104

,534)

(211

,686)

(266

,825)

(248

,257)

(394

,780)

(437

,468)

(253

,706)

(232

,359)

(1,75

2,200

) (1

,829,9

96)

Regis

trar an

d trans

fer age

nt fees

12.2

(40,2

84)

(61,0

04)

(20,3

01)

(36,2

28)

(22,0

89)

(32,3

35)

(27,7

25)

(48,4

58)

(19,4

86)

(24,3

34)

(129

,885)

(202

,359)

Custo

dian a

nd pay

ing ag

ent fee

s12.

2 (3

0,757

) (4

2,960

) (1

8,845

) (1

8,049

) (8

,544)

(7,95

0) (2

2,757

) (1

8,878

) (1

6,641

) (1

8,820

) (9

7,544

) (1

06,65

7)Ad

ministr

ation fe

e12.

2 (3

0,072

) (3

1,431

) (2

8,867

) (3

2,030

) (2

1,490

) (2

9,964

) (2

1,485

) (3

0,528

) (1

8,544

) (2

8,038

) (1

20,45

8) (1

51,99

1)Bro

kerage

fees

2.2 (J

) (3

16,33

6) (5

72,30

4) (3

,674)

(1,61

8) (8

,920)

(7,73

2) (5

9,475

) (3

1,136

) (1

95,33

4) (1

20,27

3) (5

83,73

9) (7

33,06

3)Au

ditors'

remune

ration

(33,7

83)

(34,6

48)

(31,5

33)

(32,2

63)

(17,1

12)

(16,3

34)

(18,2

63)

(7,16

4) (1

3,679

) (1

1,907

) (1

14,37

0) (1

02,31

6)Leg

al and

profes

sional

fees

(25,1

61)

(24,6

05)

(36,7

11)

(26,6

17)

(11,9

76)

(13,6

11)

(19,4

66)

(28,3

35)

(11,1

86)

(17,5

47)

(104

,500)

(110

,715)

Public

ation a

nd prin

ting fee

s (6

,615)

(11,1

15)

(6,05

2) (1

0,618

) (2

,661)

(4,57

5) (3

,680)

(9,15

0) (2

,926)

(4,40

2) (2

1,934

) (3

9,860

)Oth

er oper

ating e

xpense

s (2

3) (9

26)

(35)

(3,39

1) (1

,180)

(2,19

7) (6

2) (1

45)

(70)

(7,94

4) (1

,370)

(14,6

03)

The

acco

mpa

nyin

g no

tes

form

an

inte

gral

par

t of t

hese

fina

ncia

l sta

tem

ents

.

Man

ulife

Adv

ance

d Fu

nd S

PC

25

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

Notes

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DTot

al oper

ating e

xpense

s (1

,215,3

86)

(1,47

9,219

) (2

50,55

2) (3

72,50

0) (3

60,79

7) (3

62,95

5) (5

67,69

3) (6

11,26

2) (5

31,57

2) (4

65,62

4) (2

,926,0

00)

(3,29

1,560

)

Opera

ting pr

ofit / (l

oss) be

fore ta

x and

distrib

ution

12,30

8,475

9,

122,8

39

4,03

7,680

34

0,699

3,

020,9

23

(732

,811)

12,86

9,480

(5

,103,6

15)

1,84

4,662

1,

066,0

59

34,08

1,220

4,

693,1

71

Tax2.3

, 11 (5

8,594

) (5

3,359

) (4

,790)

(70,9

13)

(40,3

11)

(39,2

68)

(225

,856)

(261

,792)

(9,57

5) (8

,072)

(339

,126)

(433

,404)

Distrib

ution to

holde

rs of R

edeem

able

Partic

ipating

Share

s20

– –

– –

(806

,443)

(815

,084)

(124

)–

(324

,501)

(392

,188)

(1,13

1,068

) (1

,207,2

72)

Increa

se / (d

ecreas

e) in n

et asse

ts attrib

utable

to hol

ders o

f Rede

emabl

e Parti

cipatin

g Shar

es fro

m oper

ations–

being

total co

mpreh

ensive

inc

ome /

(loss)

12,24

9,881

9,

069,4

80

4,03

2,890

26

9,786

2,

174,1

69

(1,58

7,163

) 12

,643,5

00

(5,36

5,407

) 1,

510,5

86

665,7

99

32,61

1,026

3,

052,4

95

Stat

emen

t of C

ompr

ehen

sive

Inco

me

(con

tinue

d)

The

acco

mpa

nyin

g no

tes

form

an

inte

gral

par

t of t

hese

fina

ncia

l sta

tem

ents

.

Man

ulife

Adv

ance

d Fu

nd S

PC

26

Stat

emen

t of C

hang

es in

Net

Ass

ets

Attr

ibut

able

to h

olde

rs o

f Red

eem

able

Par

ticip

atin

g Sh

ares

For t

he y

ear e

nded

30

June

202

1

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

Notes

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DOp

ening

balanc

e 40

,154,4

01

42,23

3,925

29

,473,8

42

50,67

8,052

16

,006,1

50

16,79

2,485

19

,201,7

12

50,01

0,859

11

,622,9

75

21,21

1,884

11

6,459

,080

180,9

27,20

5 Inc

rease

/ (decr

ease)

in net a

ssets a

ttributa

ble to

holder

s of R

edeem

able P

articipa

ting Sh

ares–b

eing to

tal com

prehen

sive inc

ome /

(loss)

12,24

9,881

9,

069,4

80

4,03

2,890

26

9,786

2,

174,1

69

(1,58

7,163

) 12

,643,5

00

(5,36

5,407

) 1,

510,5

86

665,7

99

32,61

1,026

3,

052,4

95

Issue o

f Redee

mable

Partic

ipating

Share

s8

10,26

1,185

87

6,475

18

,190,4

46

23,26

0 6,

155,6

87

4,22

9,322

62

,304,4

01

11,11

3,586

24

,929,2

76

2,15

5,515

12

1,840

,995

18,39

8,158

Red

emptio

n of Re

deema

ble Pa

rticipa

ting Sh

ares

8(18

,559,3

54)

(12,02

5,479

)(9,

824,6

91)

(21,49

7,256

)(6,

007,4

16)

(3,42

8,494

)(65

,086,8

75)

(36,55

7,326

)(6,

753,8

11)

(12,41

0,223

)(10

6,232

,147)

(85,9

18,77

8)

Net as

sets a

ttribut

able to

holde

rs of R

edeem

able

Partici

pating

Share

s at en

d of ye

ar 44

,106,1

13

40,15

4,401

41

,872,4

87

29,47

3,842

18

,328,5

90

16,00

6,150

29

,062,7

38

19,20

1,712

31

,309,0

26

11,62

2,975

16

4,678

,954

116,4

59,08

0

Stat

emen

t of C

hang

es in

Equ

ityFo

r the

yea

r end

ed 3

0 Ju

ne 2

021

Comb

ined

Notes

For t

he ye

aren

ded 3

0 Jun

e 20

21

For t

he ye

aren

ded 3

0 Jun

e 20

20

USD

USD

Open

ing ba

lance

8 10

0 10

0 Iss

ue of

Man

agem

ent S

hares

– –

Clos

ing ba

lance

at en

d of y

ear

100

100

The

acco

mpa

nyin

g no

tes

form

an

inte

gral

par

t of t

hese

fina

ncia

l sta

tem

ents

.

Man

ulife

Adv

ance

d Fu

nd S

PC

27

Stat

emen

t of C

ash

Flow

s

For t

he y

ear e

nded

30

June

202

1

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

Notes

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DCa

sh flow

s from

opera

ting ac

tivities

Increa

se / (d

ecreas

e) in n

et asse

ts attrib

utable

to hol

ders o

f Rede

emabl

e Parti

cipatin

g Shar

es–dis

tributio

n excl

uded

12,24

9,881

9,

069,4

80

4,03

2,890

26

9,786

2,

980,6

12

(772

,079)

12,64

3,624

(5

,365,4

07)

1,83

5,087

1,

057,9

87

33,74

2,094

4,

259,7

67

Net ch

anges

in oper

ating a

ssets a

nd liab

ilities

Decre

ase / (i

ncreas

e) in fi

nancia

l asset

s and

liabilitie

s at fa

ir valu

e throu

gh pro

fit or lo

ss (4

,492,6

24)

1,68

4,588

(1

1,851

,117)

21,02

6,445

(2

,816,6

68)

840,9

67

(10,52

6,227

) 31

,921,1

20

(18,98

7,448

) 9,

546,2

98

(48,67

4,084

) 65

,019,4

18

Decre

ase / (i

ncreas

e) in o

ther re

ceivab

les an

d pre

payme

nts (5

,926)

(759

) (3

57,59

5) 39

6,389

(4

72,26

8) (1

6,931

) 2,

006

16,01

3 (2

88,50

7) 95

,838

(1,12

2,290

) 49

0,550

Inc

rease

/ (decr

ease) i

n acco

unts p

ayable

and

accrue

d expe

nses

21,60

6 22

,526

60,79

5 58

,618

270,6

34

6,35

2 31

,812

(47,7

33)

96,73

1 33

,534

481,5

78

73,29

7 Ne

t cash

provid

ed by

/ (used

in) op

erating

act

ivities

7,77

2,937

10

,775,8

35

(8,11

5,027

) 21

,751,2

38

(37,6

90)

58,30

9 2,

151,2

15

26,52

3,993

(17

,344,1

37)

10,73

3,657

(15

,572,7

02)

69,84

3,032

Cash

flows fr

om fin

ancing

activi

tiesIss

ue of R

edeem

able P

articip

ating S

hares

10,09

2,195

86

6,103

18

,190,4

46

23,26

0 6,1

37,55

8 4,

255,4

44

62,38

8,650

10

,493,4

33

24,91

5,198

2,

118,3

75

121,7

24,04

7 17

,756,6

15

Redem

ption o

f Rede

emabl

e Parti

cipatin

g Shar

es (1

7,852

,566)

(11,7

66,79

0) (9

,980,1

21)

(21,9

04,31

2) (5

,880,3

79)

(3,37

7,592

) (6

4,334

,424)

(36,7

14,68

2) (6

,213,8

88)

(12,3

75,62

5) (1

04,26

1,378

) (8

6,139

,001)

Distrib

utions

paid to

holde

rs of R

edeem

able

Partic

ipating

Share

s–

– –

– (8

06,44

3) (8

15,08

4) (1

24)

– (3

24,50

1) (3

92,18

8) (1

,131,0

68)

(1,20

7,272

)Ne

t cash

flow pr

ovided

by / (u

sed in)

financ

ing

activit

ies (7

,760,3

71)

(10,9

00,68

7) 8,

210,3

25

(21,88

1,052

) (5

49,26

4) 62

,768

(1,94

5,898

) (2

6,221

,249)

18,37

6,809

(10

,649,4

38)

16,33

1,601

(69

,589,6

58)

The

acco

mpa

nyin

g no

tes

form

an

inte

gral

par

t of t

hese

fina

ncia

l sta

tem

ents

.

Man

ulife

Adv

ance

d Fu

nd S

PC

28

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

Notes

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DNe

t incre

ase / (d

ecreas

e) in c

ash an

d cash

equ

ivalen

ts 12

,566

(124

,852)

95,29

8 (1

29,81

4) (5

86,95

4) 12

1,077

20

5,317

30

2,744

1,

032,6

72

84,21

9 75

8,899

25

3,374

Cash

and ca

sh equ

ivalen

t at be

ginnin

g of th

e yea

r 17

1,854

29

6,706

13

3,007

26

2,821

65

3,268

53

2,191

44

7,270

14

4,526

34

5,819

26

1,600

1,

751,2

18

1,49

7,844

Cash

and ca

sh equ

ivalen

t at en

d of th

e year

5 18

4,420

17

1,854

22

8,305

13

3,007

66

,314

653,2

68

652,5

87

447,2

70

1,37

8,491

34

5,819

2,

510,1

17

1,75

1,218

Stat

emen

t of C

ash

Flow

s (c

ontin

ued)

The

acco

mpa

nyin

g no

tes

form

an

inte

gral

par

t of t

hese

fina

ncia

l sta

tem

ents

.

Man

ulife

Adv

ance

d Fu

nd S

PC

29

Net

cas

h us

ed in

ope

ratin

g ac

tivite

s in

clud

es:

Stat

emen

t of C

ash

Flow

s (c

ontin

ued)

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

Notes

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DDi

viden

d inc

ome

579,5

4853

3,593

– –

410,7

60

460,2

40

744,0

07

907,6

49

235,3

15

285,5

61

1,969

,630

2,187

,043

Intere

st inc

ome

442

2,255

1,228

,721

1,804

,615

345,8

51

285,0

65

– –

162,8

17

399,7

85

1,737

,831

2,491

,720

Intere

st ex

pens

e (2

4) (9

25)

(34)

(652

) (1

,181)

(2,19

6) (6

1) (1

47)

(70)

(7,94

6) (1

,370)

(11,8

66)

With

holdi

ng ta

x on i

ncom

e (5

8,594

) (5

3,359

)–

– (4

0,311

) (3

9,268

) (2

25,85

6) (2

61,79

2) (9

,575)

(8,07

2) (3

34,33

6) (3

62,49

1)

Rec

onci

liatio

n of

mov

emen

ts o

f lia

bilit

ies

aris

ing

from

fina

ncin

g ac

tiviti

es:

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r

ende

d 30 J

une

2021

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

D

Payabl

e on r

edemp

tions a

t begin

ning o

f the y

ear32

4,717

66,02

821

3,924

620,9

8051

,269

367

175,6

39 33

2,995

34

,598

– 80

0,147

1,020

,370

Increa

se du

e to r

edem

ption

of R

edee

mable

Pa

rticipa

ting S

hares

18,55

9,354

12,02

5,479

9,824

,691

21,49

7,256

6,007

,416

3,428

,494

65,08

6,875

36,55

7,326

6,7

53,81

1 12

,410,2

23

106,2

32,14

785

,918,7

78De

creas

e due

to pa

ymen

ts on

rede

mptio

ns of

Re

deem

able

Partic

ipatin

g Sha

res (1

7,852

,566)

(11,7

66,79

0) (9

,980,1

21)

(21,9

04,31

2) (5

,880,3

79)

(3,37

7,592

) (6

4,334

,424)

(36,7

14,68

2) (6

,213,8

88)

(12,3

75,62

5) (1

04,26

1,378

) (8

6,139

,001)

Payabl

e on r

edemp

tions a

t end o

f the y

ear1,0

31,50

532

4,717

58,49

421

3,924

178,3

0651

,269

928,0

9017

5,639

574,5

21

34,59

8 2,7

70,91

680

0,147

The

acco

mpa

nyin

g no

tes

form

an

inte

gral

par

t of t

hese

fina

ncia

l sta

tem

ents

.


30

Statement of Distribution

For the year ended 30 June 2021

CurrencyDistribution Per Share

Total Distribution

Distribution Date

Asia Pacific Income and Growth FundMonthly DividendClass AA (USD) Inc USD 0.0370 34,576.24 9-Jul-20

Class AA (USD) Inc USD 0.0370 34,809.52 10-Aug-20

Class AA (USD) Inc USD 0.0370 32,959.19 8-Sep-20

Class AA (USD) Inc USD 0.0350 31,214.87 12-Oct-20

Class AA (USD) Inc USD 0.0350 32,096.66 9-Nov-20

Class AA (USD) Inc USD 0.0350 32,132.43 8-Dec-20

Class AA (USD) Inc USD 0.0350 32,360.14 11-Jan-21

Class AA (USD) Inc USD 0.0350 33,634.13 8-Feb-21

Class AA (USD) Inc USD 0.0350 33,642.20 8-Mar-21

Class AA (USD) Inc USD 0.0350 36,095.51 13-Apr-21

Class AA (USD) Inc USD 0.0350 34,367.28 10-May-21

Class AA (USD) Inc USD 0.0350 33,063.22 8-Jun-21

400,951.39

Class AA (AUD) Inc Hedged AUD 0.0360 7,148.39 9-Jul-20

Class AA (AUD) Inc Hedged AUD 0.0360 7,173.20 10-Aug-20

Class AA (AUD) Inc Hedged AUD 0.0360 7,212.91 8-Sep-20

Class AA (AUD) Inc Hedged AUD 0.0337 6,765.46 12-Oct-20

Class AA (AUD) Inc Hedged AUD 0.0337 6,786.73 9-Nov-20

Class AA (AUD) Inc Hedged AUD 0.0337 6,793.79 8-Dec-20

Class AA (AUD) Inc Hedged AUD 0.0337 6,814.25 11-Jan-21

Class AA (AUD) Inc Hedged AUD 0.0337 6,771.83 8-Feb-21

Class AA (AUD) Inc Hedged AUD 0.0337 6,791.75 8-Mar-21

Class AA (AUD) Inc Hedged AUD 0.0337 6,823.98 13-Apr-21

Class AA (AUD) Inc Hedged AUD 0.0337 6,848.76 10-May-21

Class AA (AUD) Inc Hedged AUD 0.0337 6,873.48 8-Jun-21

82,804.53

Class AA (HKD) Inc HKD 0.3700 176,706.79 9-Jul-20

Class AA (HKD) Inc HKD 0.3700 176,878.06 10-Aug-20

Class AA (HKD) Inc HKD 0.3700 171,074.35 8-Sep-20

Class AA (HKD) Inc HKD 0.3501 162,491.21 12-Oct-20

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


31

Statement of Distribution (continued)



Total Distribution

Distribution Date

Asia Pacific Income and Growth Fund (continued)Monthly Dividend (continued)Class AA (HKD) Inc HKD 0.3501 161,826.97 9-Nov-20

Class AA (HKD) Inc HKD 0.3501 162,833.89 8-Dec-20

Class AA (HKD) Inc HKD 0.3501 162,928.69 11-Jan-21

Class AA (HKD) Inc HKD 0.3501 165,127.99 8-Feb-21

Class AA (HKD) Inc HKD 0.3501 165,826.00 8-Mar-21

Class AA (HKD) Inc HKD 0.3501 165,510.03 13-Apr-21

Class AA (HKD) Inc HKD 0.3501 165,914.60 10-May-21

Class AA (HKD) Inc HKD 0.3501 163,909.27 8-Jun-21

2,001,027.85

Class AA (CAD) Inc Hedged CAD 0.0360 9,336.39 9-Jul-20

Class AA (CAD) Inc Hedged CAD 0.0360 9,376.46 10-Aug-20

Class AA (CAD) Inc Hedged CAD 0.0360 9,416.33 8-Sep-20

Class AA (CAD) Inc Hedged CAD 0.0332 8,729.10 12-Oct-20

Class AA (CAD) Inc Hedged CAD 0.0332 9,154.54 9-Nov-20

Class AA (CAD) Inc Hedged CAD 0.0332 9,189.58 8-Dec-20

Class AA (CAD) Inc Hedged CAD 0.0332 9,190.34 11-Jan-21

Class AA (CAD) Inc Hedged CAD 0.0332 9,223.64 8-Feb-21

Class AA (CAD) Inc Hedged CAD 0.0332 9,223.34 8-Mar-21

Class AA (CAD) Inc Hedged CAD 0.0332 9,256.71 13-Apr-21

Class AA (CAD) Inc Hedged CAD 0.0332 9,290.28 10-May-21

Class AA (CAD) Inc Hedged CAD 0.0332 9,323.73 8-Jun-21

110,710.44



32




Total Distribution

Distribution Date

U.S. Bank Equity FundSemi-Annual DividendClass AA (USD) Inc USD 0.000058 124.33 11-Jan-21

124.33

Greater Bay Area Growth and Income FundMonthly Dividend Class AA (USD) Inc USD 0.0280 7,344.71 9-Jul-20












146,403.41













51,054.49The accompanying notes form an integral part of these financial statements.


33




Total Distribution

Distribution Date

Greater Bay Area Growth and Income Fund (continued)Monthly Dividend (continued)Class AA (HKD) Inc HKD 0.2800 73,697.15 9-Jul-20




Class AA (HKD) Inc HKD 0.2800 75,778.06 9-Nov-20








1,083,032.98



34





Total Distribution

Distribution Date

Asia Pacific Income and Growth FundMonthly DividendClass AA (USD) Inc USD 0.0370 31,099.72 10-Jul-19












391,772.61













83,857.49

Class AA (HKD) Inc HKD 0.3700 184,186.62 10-Jul-19





35



Total Distribution

Distribution Date

Asia Pacific Income and Growth Fund (continued)Monthly Dividend (continued)Class AA (HKD) Inc HKD 0.3700 186,333.72 8-Nov-19








2,227,128.09

Class AA (CAD) Inc Hedged CAD 0.0360 8,911.07 10-Jul-19

Class AA (CAD) Inc Hedged CAD 0.0360 8,946.95 8-Aug-19

Class AA (CAD) Inc Hedged CAD 0.0360 8,984.27 9-Sep-19

Class AA (CAD) Inc Hedged CAD 0.0360 9,021.13 10-Oct-19

Class AA (CAD) Inc Hedged CAD 0.0360 9,058.48 8-Nov-19

Class AA (CAD) Inc Hedged CAD 0.0360 9,094.96 9-Dec-19

Class AA (CAD) Inc Hedged CAD 0.0360 9,096.00 9-Jan-20

Class AA (CAD) Inc Hedged CAD 0.0360 9,131.92 10-Feb-20

Class AA (CAD) Inc Hedged CAD 0.0360 9,168.73 9-Mar-20

Class AA (CAD) Inc Hedged CAD 0.0360 9,208.46 8-Apr-20

Class AA (CAD) Inc Hedged CAD 0.0360 9,252.99 11-May-20

Class AA (CAD) Inc Hedged CAD 0.0360 9,295.82 8-Jun-20

109,170.78




36



Total Distribution

Distribution Date

Greater Bay Area Growth and Income FundMonthly Dividend Class AA (USD) Inc USD 0.0280 20,598.67 10-Jul-19












155,230.05













60,999.06




37



Total Distribution

Distribution Date

Greater Bay Area Growth and Income Fund (continued)Monthly Dividend (continued)Class AA (HKD) Inc HKD 0.2800 161,525.05 10-Jul-19




Class AA (HKD) Inc HKD 0.2800 158,138.21 8-Nov-19








1,525,524.80



Notes to Financial Statements


38

1. Corporate information

Manulife Advanced Fund SPC (the “Company”) is an exempted segregated portfolio company with limited liability incorporated on 14 July 2008 in the Cayman Islands under the Companies Act (as revised) of the Cayman Islands. The Company is incorporated and established for an unlimited duration. The Company commenced operations on 21 September 2010. The Company’s registered office is at Ugland House (P.O. Box 309), Grand Cayman, Cayman Islands.

The Company is registered under the Mutual Funds Act of the Cayman Islands, governed by the laws of the Cayman Islands and regulated by the Cayman Islands Monetary Authority (“CIMA”). In connection with all Class AA Shares of the Company available for offer to the public in Hong Kong, the Company is authorized by the Securities and Futures Commission of Hong Kong (“SFC”) and is required to comply with the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) and the Code on Unit Trusts and Mutual Funds established by the SFC (the “Code”). Authorizations have been given by the Monetary Authority of Macao to the Company to market selected Segregated Portfolios in Macau. Notifications have been made to the Monetary Authority of Singapore for the Company to offer selected Segregated Portfolios as restricted foreign schemes in Singapore.

The investment activities of the Company are managed by Manulife Investment Management (Hong Kong) Limited.

The Company may establish and maintain one or more funds (“Segregated Portfolios”) in order to segregate the assets and liabilities of the Company held within or on behalf of a Segregated Portfolio from the assets and liabilities of the Company held within or on behalf of any other Segregated Portfolio or from the assets and liabilities of the Company which are not held within or on behalf of any Segregated Portfolio (those being the “General Assets” of the Company and “General Liabilities” of the Company, respectively). As a matter of Cayman Islands law, assets within a Segregated Portfolio are only available and can only be used to meet liabilities to the creditors in respect of that particular Segregated Portfolio and are not available to meet liabilities to creditors in respect of other Segregated Portfolios or to the “General Creditors” of the Company. Notwithstanding the foregoing, the Company is a single legal entity and none of the Segregated Portfolios constitutes a legal entity separate from the Company.

As at 30 June 2021, the Company has five active Segregated Portfolios:

– China A Segregated Portfolio (this fund is presented in United States Dollars) (the “China A Fund”)

– Renminbi Bond Segregated Portfolio (this fund is presented in United States Dollars only and not in Renminbi) (the “Bond Fund”)

– Asia Pacific Income and Growth Segregated Portfolio (this fund is presented in United States Dollars) (the “Asia Pacific Income and Growth Fund”)

– U.S. Bank Equity Segregated Portfolio (this fund is presented in United States Dollars) (the "U.S. Bank Equity Fund")

– Greater Bay Area Growth and Income Segregated Portfolio (this fund is presented in United States Dollars) (the "Greater Bay Area Growth and Income Fund")



39

1. Corporate information (continued)

The objective of the China A Fund is to achieve long term capital appreciation by investing primarily in Mainland China (People’s Republic of China, excluding Hong Kong, Macau and Taiwan) capital markets. The objective of the Bond Fund is to provide capital appreciation and income generation by investing primarily in Renminbi (RMB)-denominated debt instruments issued and listed in Mainland China or traded in the Mainland China interbank bond market in accordance with applicable regulations. The objective of the Asia Pacific Income and Growth Fund is to provide investors with income and capital appreciation over the medium to longer term by investing primarily in equity and fixed income-related securities in the Asia Pacific ex-Japan region. The objective of the U.S. Bank Equity Fund is to achieve medium to long term growth of capital primarily through investing in equities (such as common, preferred and convertible preferred stocks) and equity-related investments (such as depositary receipts and exchange traded funds) of U.S. banks (including regional banks, commercial banks, industrial banks, savings and loan associations and bank holding companies incorporated in the United States of America and/or its territories). The objective of the Greater Bay Area Growth and Income Fund is to achieve capital growth and income generation by investing primarily in a diversified portfolio of equity and equity-related securities and fixed income securities of issuers which are connected to the region comprising Hong Kong, Macau and the Guangdong Province of China (“Greater Bay Area”).

The Company may establish other Segregated Portfolios.

Note: Capitalized words and phrases used in these financial statements of the Company shall, unless otherwise defined, have the same meanings as are ascribed to them in the prospectus of the Company (as may be amended and supplemented from time to time).

2. Significant accounting policies

2.1 Basis of preparation and Statement of Compliance

The financial statements of the Company and of each of its funds, comprising China A Segregated Portfolio, Renminbi Bond Segregated Portfolio, Asia Pacific Income and Growth Segregated Portfolio, U.S. Bank Equity Segregated Portfolio and Greater Bay Area Growth and Income Segregated Portfolio have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IASB”), the relevant disclosure provisions of the Memorandum and Articles of Association of the Company and the relevant disclosure requirements set out in Appendix E to the “Code on Unit Trusts and Mutual Funds (Hong Kong)”.

The financial statements have been prepared on a historical cost basis, except for financial assets and financial liabilities held at fair value through profit or loss, which have been measured at fair value.

The financial statements of the China A Fund, the Bond Fund, the Asia Pacific Income and Growth Fund, U.S. Bank Equity Fund and the Greater Bay Area Growth and Income Fund are presented in US dollars (“USD”), which is the functional currency of the funds. The combined financial statements of the Company are presented in USD.



40

2. Significant accounting policies (continued)

2.2 Summary of significant accounting policies

(A) Financial instruments

(i) Classification

The Company classifies its financial assets and financial liabilities into the categories below in accordance with IFRS 9.

To determine their classification and measurement category, IFRS 9 requires all financial assets, except equity instruments and derivatives, to be assessed based on a combination of the entity’s business model for managing the assets and the instruments’ contractual cash flow characteristics.

Financial assets and liabilities at fair value through profit or loss

This category represents financial assets and liabilities that are measured at fair value through the profit or loss. These assets and liabilities are acquired principally for the purpose of generating a profit from short-term fluctuation in price.

The Company includes in this category equity securities, investments in managed funds, debt instruments and derivatives.

Financial assets at amortized cost

This category includes loans and receivables which are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. The Company includes in this category amounts relating to other receivables.

Other financial liabilities

This category includes all financial liabilities, other than those classified as at fair value through profit or loss. The Company includes in this category amounts relating to accounts payable and accrued expenses, and consists in particular of Chinese tax, management fees and redemptions payables.

The Company accounting policy regarding the Redeemable Participating Shares is described in section (G) below.

(ii) Recognition

The Company recognizes a financial asset or a financial liability only when it becomes a party to the contractual provisions of the instrument.

Purchases or sales of financial assets that require delivery of assets within the time frame generally established by regulation or convention in the market place are recognized on the trade date, i.e., the date that the Company purchases or sells the asset.



41


2.2 Summary of significant accounting policies (continued)

(A) Financial instruments (continued)

(iii) Initial measurement

Financial assets and financial liabilities at fair value through profit or loss are recorded in the Statement of Financial Position at fair value. All transaction costs for such instruments are recognized directly in the statement of comprehensive income as brokerage fees.

Financial assets at amortized cost and financial liabilities (other than those classified as at fair value through profit or loss) are measured initially at their fair value plus any directly attributable incremental costs of acquisition or issue.

(iv) Subsequent measurement

After initial measurement, the Company measures financial instruments which are classified as at fair value through profit or loss at fair value (see (B) below). Subsequent changes in the fair value of those financial instruments are recorded in “Net gains / (losses) on financial assets and liabilities at fair value through profit or loss”. Interest earned and dividend revenue elements of such instruments are recorded separately in “Interest income” and “Dividend income”, respectively.

Financial assets at amortized cost are carried at amortized cost using the effective interest method less any allowance for impairment. Gains and losses are recognized in profit or loss when the assets are derecognized or impaired, as well as through the amortization process.

Financial liabilities, other than those classified as at fair value through profit or loss, are measured at amortized cost using the effective interest method. Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the amortization process.

The effective interest method is a method of calculating the amortized cost of a financial asset or a financial liability and of allocating the interest income or interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument or, when appropriate, a shorter period to the net carrying amount of the financial asset or financial liability. When calculating the effective interest rate, the Company estimates cash flows considering all contractual terms of the financial instruments but does not consider future credit losses. The calculation includes all fees paid or received between parties to the contract that are an integral part of the effective interest rate, transaction costs and all other premiums or discounts.



42



(A) Financial instruments (continued)

(v) Derecognition

A financial asset (or, where applicable a part of a financial asset or part of a group of similar financial assets) is derecognized where:

– The rights to receive cash flows from the asset have expired; or

– The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a “passthrough” arrangement; and

– Either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, and has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the extent of the Company’s continuing involvement in the asset.

The Company derecognizes a financial liability when the obligation under the liability is discharged, cancelled or expires.

(B) Determination of fair value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The fair value for financial instruments traded in active markets at the reporting date is based on their closing quoted price or binding dealer price quotations, without any deduction for transaction costs.

For all other financial instruments not traded in an active market, the fair value is determined by using appropriate valuation techniques. Valuation techniques include: using recent arm’s length market transactions; reference to the current market value of another instrument that is substantially the same; discounted cash flow analysis and option pricing models making as much use of available and supportable market data as possible.

An analysis of fair values of financial instruments and further details as to how they are measured are provided in Note 4.



43



(C) Impairmentoffinancialassets

The Company’s impairment policy has been updated to align with the requirements of the IFRS 9 expected credit loss model. At each reporting date, the Company shall measure the loss allowance, on all amounts reported at amortised cost, at an amount equal to the lifetime expected credit losses, if the credit risk has increased significantly since initial recognition. If at reporting date, the credit risk has not increased significantly since initial recognition, the Company shall measure the loss allowance at an amount equal to 12-month expected credit losses.

The Company measures credit risk and expected credit losses using probability of default, exposure at default and loss given default. The Company considers both historical analysis and forward looking information in determining any expected credit losses.

The Company holds only trade receivables with no financing component and which have maturities of less than 12 months at amortised cost and, as such, has chosen to apply an approach similar to the simplified approach for expected credit losses (ECL) under IFRS 9 to all its trade receivables.

(D) Offsettingfinancialinstruments

Financial assets and financial liabilities are offset and the net amount reported in the statement of financial position if, and only if, there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, or to realize the asset and settle the liability simultaneously. This is generally not the case with master-netting agreements, and the related assets and liabilities are presented gross in the statement of financial position.

(E) Functional and presentation currencies

Liquidity of Company is managed on a day-to-day basis in USD for the China A Fund, the Bond Fund, the Asia Pacific Income and Growth Fund, the U.S. Bank Equity Fund and the Greater Bay Area Growth and Income Fund in order to handle the issuance and redemptions of each segregated portfolios’ redeemable preference shares. This currency is also used to evaluate the segregated portfolios’ performance. Management therefore considers USD as the currency that most faithfully represent the economic effects of the underlying transactions, events and conditions.

(F) Foreign currency translations

Transactions during the year, including purchases and sales of securities, income and expenses, are translated at the rate of exchange prevailing on the date of the transaction.

Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency rate of exchange ruling at the end of each reporting period.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.



44



(F) Foreign currency translations (continued)

Foreign currency transaction gains and losses on financial instruments classified as at fair value through profit or loss are included in the statement of comprehensive income as part of the “Net gains / (losses)on financial assets and liabilities at fair value through profit or loss”. Foreign exchange differences on other financial instruments are included in the statement of comprehensive income as “Net foreign exchange gains/ (losses)”.

(G) Management and Redeemable Participating Shares

Management Shares are non-participating and issued for the purpose of enabling all the Participating Shares to be redeemed without liquidating the Company. They are, by definition, not redeemable at the shareholders’ option and are classified as Equity. Redeemable Participating Shares are redeemable at the shareholders’ option and are classified as financial liabilities. The Company continuously assesses the classification of Shares.

Redeemable Participating Shares are measured at their redemption amounts.

No distribution of dividend or capital has been made since the inception of the China A Fund and the Bond Fund up to 30 June 2021. It is not the intention of the Company to make any distribution out of the China A Fund and the Bond Fund, although this policy may change in the future with prior written notice to Shareholders of the Company. For the Asia Pacific Income and Growth Fund, it is currently intended that dividends are declared after the end of each month and which, subject to applicable law, may be paid out of capital or gross income of the relevant Class of the Segregated Portfolio while charging/paying all or part of the Classes fees and expenses to/out of the capital of the relevant Class of the Segregated Portfolio and (unless otherwise determined by the Company) are in the respective currency of denomination of the relevant Class of the Segregated Portfolio. The dividends declared (if any) are paid within three weeks of such declaration. For the U.S. Bank Equity Fund, it is currently intended that dividends are declared on a semi-annual basis and which, subject to applicable law, may be paid out of gross income of the relevant Class of the Segregated Portfolio while charging/paying all or part of the Classes fees and expenses to/out of the capital of the relevant Class of the Segregated Portfolio and (unless otherwise determined by the Company) are in the respective currency of denomination of the relevant Class of the Segregated Portfolio. The dividends declared (if any) are paid within three weeks of such declaration. For the Greater Bay Area Growth and Income Fund, in respect of Class AA (USD) Inc, Class AA (HKD) Inc, Class AA (AUD) Inc Hedged, it is currently intended that dividends are declared on a monthly basis and which, subject to applicable law, may be paid out of capital or gross income of the relevant Class of the Segregated Portfolio while charging/paying all or part of the Classes fees and expenses to/out of the capital of the relevant Class of the Segregated Portfolio and (unless otherwise determined by the Company) are in the respective currency of denomination of the relevant Class of the Segregated Portfolio. The dividends declared (if any) are paid within three weeks of such declaration. In respect of Class AA, it is not the intention of the Company to make any distributions in respect of such Classes (which are accumulation Classes) of the Greater Bay Area Growth and Income Fund, although this policy may change with prior written notice to Shareholders.

(H) Cash and cash equivalents

Cash and cash equivalents in the statement of financial position consist of cash balances on deposit with international financial institutions with original maturities of three months or less.



45



(I) Due from / due to brokers

Due from brokers and due to brokers in the statement of financial position respectively include the receivable resulting from sales of financial instruments and the payable resulting from purchases of financial instruments.

(J) Transaction costs

Transaction costs consist of brokerage fees, dealing fees and stamp duty tax (if applicable) and are recognized in the statement of comprehensive income as brokerage fees.

(K) Interest income and expense

Interest income and expense are recognized in the statement of comprehensive income for all interest bearing financial instruments on an accrual basis.

(L) Dividend income

Dividend income is accounted for on an ex-dividend basis gross of any irrecoverable withholding taxes, which are disclosed separately in the statement of comprehensive income.

(M) Netgains/(losses)onfinancialassetsandliabilitiesatfairvaluethroughprofitorloss

This item includes changes in the fair value of financial assets and liabilities held for trading or designated upon initial recognition as “at fair value through profit or loss” and excludes interest and dividend income and expense.

Unrealized gains and losses comprise changes in the fair value of financial instruments for the year.

Realized gains and losses on disposals of financial instruments classified as “at fair value through profit or loss” are determined on the basis of the weighted average cost method. They represent the difference between an instrument’s initial carrying amount and disposal amount, or cash payments or receipts made on derivative contracts (excluding payments or receipts on collateral margin accounts for such instruments).

(N) Income taxes

There is currently no taxation imposed on income or capital gains by the Government of the Cayman Islands. The only taxes payable by the Company are withholding taxes of other countries applicable to certain investment income and capital gain taxes when the Company trades securities in other countries where applicable.

Further details on taxation are provided in Note 11.



46



(O) Formation expenses

The costs of establishing the China A Fund and applying for the authorization of the Class AA Shares in Hong Kong by the SFC and the authorization of the Class I Shares and Class P Shares in the Cayman Islands by the CIMA amounted to approximately USD 345,000 in aggregate and was borne by the China A Fund and deducted from its assets for the account of each of the relevant Class and/or Series (as the case may be) in proportion to their respective Net Asset Values (“NAV”).

The costs of establishing the Bond Fund and applying for the authorization of the Class AA Shares in Hong Kong by the SFC and the authorization of the Class I Shares by the CIMA amounted to approximately USD 220,000 in aggregate and was borne by the Bond Fund and deducted from its assets for the account of each of the relevant Class and/or Series (as the case may be) in proportion to their respective Net Asset Values.

The costs of establishing the Asia Pacific Income and Growth Fund and the authorization of the Class AA (including the USD, AUD, HKD and CAD denominated Share classes), Class C, Class D and Class I Shares in the Cayman Islands by CIMA and with the SFC in Hong Kong amounted to approximately USD 50,000 in aggregate and was borne by the Asia Pacific Income and Growth Fund and deducted from its assets for the account of each of the relevant Class and/or Series (as the case may be) in proportion to their respective Net Asset Values.

The costs of establishing the U.S. Bank Equity Fund and related formalities with the CIMA in the Cayman Islands and with the SFC in Hong Kong amounted to approximately USD 188,000 (subsequently reduced to USD 140,000) in aggregate and was borne by the U.S. Bank Equity Fund and deducted from its assets for the account of each of the relevant Class and/or Series (as the case may be) in proportion to their respective Net Asset Values.

The costs of establishing the Greater Bay Area Growth and Income Fund and related formalities with the CIMA in the Cayman Islands and with the SFC in Hong Kong amounted to approximately USD 70,000 in aggregate and was borne by the Greater Bay Area Growth and Income Fund and deducted from its assets for the account of each of the relevant Class and/or Series (as the case may be) in proportion to their respective Net Asset Values.

In accordance with the Prospectus, the above mentioned expenses are amortised over the first five financial years of the Company commencing from the first business day following the inception date of the respective Segregated Portfolio. However, the accounting policy of the Segregated Portfolios for reporting purpose is to record the costs incurred in the formation of the Segregated Portfolios in the statement of comprehensive income in the period in which they arise.

The effect of the adjustment on expensing previously capitalized formation expenses to the published NAV is detailed in Note 15.

2.3 Significant accounting judgments, estimates and assumptions

The preparation of the Company’s financial statements requires management to make judgments, estimates and assumptions that affect the amounts recognized in the financial statements. However, uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustment to the carrying amount of the asset or liability affected in the future.



47


2.3 Significant accounting judgments, estimates and assumptions (continued)

Judgments

In the process of applying the Company’s accounting policies, management has made the following judgments, which have the most significant effect on the amounts recognized in the financial statements:

Going Concern

The Company’s management has made an assessment of the Company’s ability to continue as a going concern and is satisfied that the Company has the resources to continue in business for the foreseeable future. Furthermore, management is not aware of any material uncertainties that may cast significant doubt upon the Company’s ability to continue as a going concern. Therefore, the combined financial statements are prepared on the going concern basis.

Functional currency

Liquidity of Company is managed on a day-to-day basis in USD for the China A Fund, the Bond Fund, the Asia Pacific Income and Growth Fund, the U.S. Bank Equity Fund and the Greater Bay Area Growth and Income Fund in order to handle the issuance and redemptions of each segregated portfolios’ Redeemable Participating shares. This currency is also used to evaluate the segregated portfolios’ performance. Management therefore considers USD as the currency that most faithfully represent the economic effects of the underlying transactions, events and conditions.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below. The Company based its assumptions and estimates on parameters available when the combined financial statements were prepared. However, existing circumstances and assumptions about future developments may change due to market changes or circumstances arising beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

Fair value of financial instruments

When the fair value of financial assets and liabilities recorded in the statement of financial position cannot be derived from active markets, their fair value is determined using a variety of valuation techniques that include the use of pricing models. The inputs to these models are taken from observable markets where possible, but where this is not feasible, estimation is required in establishing fair values. The estimates include considerations of liquidity and model inputs such as credit risk (both own and the counterparty’s), correlation and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments in the statement of financial position and the level where the instruments are disclosed in the fair value hierarchy. The models are calibrated regularly and tested for validity using prices from any observable current market transactions in the same instrument (without modification or repackaging) or based on any available observable market data.



48


2.3 Significant accounting judgments, estimates and assumptions (continued)

Taxes

Enterprise Income tax (“EIT”) on capital gains arising from the trading of securities in the PRC

Prior to 17 November 2014, PRC EIT on the gross capital gains derived from trading PRC securities was unclear as to: (a) whether the PRC would enforce EIT on gains derived from the trading of PRC securities by a QFII; and (b) if the PRC were to enforce EIT, it is uncertain from which date EIT would be calculated and payable. Given the above uncertainty, the Investment Manager made a 10% withholding tax provision on realized and unrealized gains derived from the trading of PRC securities.

Pursuant to the issuance of the Circular CaiShui [2014] No. 79, which were jointly issued by the Ministry of Finance (“MOF”), China Securities Regulatory Commission and the State Administration of Taxation of PRC (“SAT”) on 17 November 2014, the Investment Manager ceased to provide 10% withholding tax provision on realized and unrealized gains derived from the trading of A-shares.

The Investment Manager will generally continue to provide for the 10% withholding tax on capital gains arising from the trading of PRC non-equity investments assets, including fixed income investments. The Investment Manager may consider the applicability of relevant double tax agreements to reduce the withholding tax rate as appropriate.

Further details on taxation are provided in Note 11.

2.4 Standards adopted during the year with no material effect on the Financial Statements

The accounting policies adopted are consistent with those of the previous year, except that the Company has adopted the following new and revised accounting standards (for the avoidance of doubt, only the new standards and amendments to standards which may have an effect on the Company’s accounts are mentioned below):

Amendments to references to the Conceptual Framework in IFRS Standards

This amendment revise the definitions of an asset and a liability and provide a new guidance on measurement and derecognition, presentation and disclosure. It is effective for periods beginning on or after 1 January 2020.

Amendments to IAS 1 and IAS 8 : Definition of Material

These amendments clarify the definition of “material” and align the definition used in the Conceptual Framework and the standards themselves. They are effective for periods beginning on or after 1 January 2020.



49


2.5 Standards, interpretations and amendments issued but not yet effective

Standards issued but not yet effective at the date of issuance of the Company’s financial statements are listed below.

Improvements to IFRS

The International Accounting Standards Board (IASB) issued annual improvements to IFRS, incorporating amendments to the following International Financial Reporting Standards:

– Amendments to IFRS 3 Business Combinations

– Amendments to IAS 16 Property, Plant and Equipment

– Amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets

These amendments are effective for annual periods beginning on or after 1 January 2022. The Company expects no impact from the adoption of the amendments on its financial position or performance.

Amendments to IAS 1 : Classification of Liabilities as Current or Non-current

This amendment provide a more general approach to the classification of liabilities under IAS 1 based on the contractual arrangements in place at the reporting date. It only affects the presentation of liabilities in the statement of financial position. It is effective for periods beginning on or after 1 January 2023 and is not expected to have impact on the Company’s financial position or performance.

Amendments to IFRS 9, IFRS 7, IFRS 4, IFRS 16 and IAS 39: Interest Rate Benchmark Reform – Phase 2

These amendments address issues that might affect financial reporting after the reform of an interest rate benchmark, including its replacement with alternative benchmark rates. They are effective for periods beginning on or after 1 January 2021 and are not expected to have impact on the Company’s financial position or performance.

IRFS 17: Insurance Contracts

This standard establishes the principles for recognition, measurement, presentation and disclosure of insurance contracts. The objective is to ensure that an entity provides relevant information that faithfully represents those contracts. It is effective for periods beginning on or after 1 January 2023 and is not expected to have impact on the Company’s financial position or performance.

All the standards and amendments mentioned in this section have not been adopted by the Company as at 30 June 2021.

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30 Ju

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2130

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30 Ju

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USD

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Finan

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30 Ju

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2130

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June

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30 Ju

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2130

June

2020

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

30 Ju

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June

2020

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

Reali

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49

4,06

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51

4. Fair value of financial instruments

The following table shows financial instruments recognised at fair value, analysed between those whose fair value is based on:

– Quoted prices in active markets for identical assets or liabilities (Level 1);

– Those involving inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices) (Level 2); and

– Those with inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).

Fair value hierarchy

As at 30 June 2021 Level 1 Level 2 Level 3 Total

Financial assets at fair value through profit or loss

China A Fund (in USD) 44,955,118 – – 44,955,118 Equities 44,955,118 – – 44,955,118

Bond Fund (in USD) 28,515,110 14,251,382 – 42,766,492 Bonds – 13,347,307 – 13,347,307 Supranationals, Governments and Local Public Authorities, Debt Instruments 28,515,110 – – 28,515,110 Forward currency contracts – 904,075 – 904,075

Asia Pacific Income and Growth Fund (in USD) 11,889,461 6,211,961 – 18,101,422 Equities 11,269,337 – – 11,269,337 Bonds 203,489 5,863,071 – 6,066,560 Supranationals, Governments and Local Public Authorities, Debt Instruments 255,591 348,890 – 604,481 Funds 161,044 – – 161,044

U.S. Bank Equity Fund (in USD) 28,837,062 – – 28,837,062 Equities 28,837,062 – – 28,837,062

Greater Bay Area Growth and Income Fund (in USD) 22,502,252 7,773,861 – 30,276,113 Equities 22,298,763 – – 22,298,763 Bonds 203,489 7,773,861 – 7,977,350

Total financial assets at fair value through profit or loss (in USD) 136,699,003 28,237,204 – 164,936,207

Financial liabilities at fair value through profit or loss

Bond Fund (in USD) – (1,071,977) – (1,071,977)Forward currency contracts – (1,071,977) – (1,071,977)

Asia Pacific Income and Growth Fund (in USD) – (28,908) – (28,908)Forward currency contracts – (28,908) – (28,908)

Greater Bay Area Growth and Income Fund (in USD) – (38,231) – (38,231)Forward currency contracts – (38,231) – (38,231)

Total financial liabilities at fair value through profit or loss (in USD) – (1,139,116) – (1,139,116)



52

4. Fair value of financial instruments (continued)

Fair value hierarchy (continued)

As at 30 June 2020 Level 1 Level 2 Level 3 Total

Financial assets at fair value through profit or loss

China A Fund (in USD) 40,462,494 – – 40,462,494 Equities 40,462,494 – – 40,462,494

Bond Fund (in USD) 12,001,231 17,842,167 – 29,843,398 Bonds – 14,861,026 – 14,861,026 Supranationals, Governments and Local Public Authorities, Debt Instruments 12,001,231 2,981,141 – 14,982,372

Asia Pacific Income and Growth Fund (in USD) 10,255,450 5,006,946 – 15,262,396 Equities 8,923,361 4,155 – 8,927,516 Bonds 958,403 4,668,892 – 5,627,295 Supranationals, Governments and Local Public Authorities, Debt Instruments 267,806 333,899 – 601,705 Funds 105,880 – – 105,880

U.S. Bank Equity Fund (in USD) 18,310,835 – – 18,310,835 Equities 18,310,835 – – 18,310,835

Greater Bay Area Growth and Income Fund (in USD) 6,490,201 4,761,547 – 11,251,748 Equities 6,490,201 – – 6,490,201 Bonds – 4,761,483 – 4,761,483 Forward currency contracts – 64 – 64

Total financial assets at fair value through profit or loss (in USD) 87,520,211 27,610,660 – 115,130,871

Financial liabilities at fair value through profit or loss

Asia Pacific Income and Growth Fund (in USD) – (6,550) – (6,550)Forward currency contracts – (6,550) – (6,550)

Greater Bay Area Growth and Income Fund (in USD) – (1,314) – (1,314)Forward currency contracts – (1,314) – (1,314)

Total financial liabilities at fair value through profit or loss (in USD) – (7,864) – (7,864)



53



Level 1 financial assets at fair value through profit or loss are marketable securities. Equities and bonds are valued at stock exchange last traded prices and quoted mid prices at the close of business on 30 June 2021 respectively. Level 2 financial assets at fair value through profit or loss are securities that are brokers’ quoted prices or those not actively traded at the close of business on 30 June 2021 which are valued at the last traded price for the identical instruments.

The financial liabilities at fair value through profit or loss are forward currency contracts and are valued by using valuation techniques and models. More precisely, the fair values of forward foreign exchange contracts are calculated by reference to current exchange rates for contracts with similar maturity and risk profiles and so involved valuation techniques where all the model inputs are observable (either directly or indirectly) in the market. It corresponds to level 2 of the IFRS 7 fair value hierarchy.

The following table presents the transfer between levels for the year ended 30 June 2021.

As at 30 June 2021 Level 1 Level 2 Level 3

Asia Pacific Income and Growth Fund USD USD USDTransfer between levels 1 and 2 (989,843) 989,843 –

The securities transferred in Level 1 relate to positions whose trading was inactive as at 30 June 2020 but was actively traded on 30 June 2021. The securities transferred in Level 2 relate to positions whose trading was active as at 30 June 2020 but was inactively traded on 30 June 2021.

The following table presents the transfer between levels for the year ended 30 June 2020.

As at 30 June 2020 Level 1 Level 2 Level 3

Bond Fund USD USD USDTransfer between levels 1 and 2 (16,057,884) 16,057,884 –

Asia Pacific Income and Growth Fund USD USD USDTransfer between levels 1 and 2 (2,658,194) 2,658,194 –

Greater Bay Area Growth and Income Fund USD USD USDTransfer between levels 1 and 2 (2,496,148) 2,496,148 –

The securities transferred in Level 2 relate to positions whose trading was active as at 30 June 2019 but was inactively traded on 30 June 2020.



54



Other than the above, there were no other transfers between levels for the years ended 30 June 2021 and 2020.

All fair value measurements disclosed are recurring fair value measurements.

For assets and liabilities carried at amortized cost, their carrying values are a reasonable approximation of fair value due to their short-term nature.

5. Cash and cash equivalents

Cash and cash equivalents as at 30 June 2021 represent cash held at banks. As at 30 June 2021 and 30 June 2020, there were no bank overdrafts and no cash equivalents were given or received as collateral.

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,279

58,90

2 62

,250

70,42

9 1,

197,5

89

1,03

4,356

The

othe

r pa

yabl

es in

clud

e ac

crue

d co

mpl

ianc

e fe

e, s

hare

cla

ss fe

e, p

ublic

atio

n an

d pr

intin

g fe

e, a

dmin

istra

tion

fee,

acc

ount

ing

fee,

tran

sfer

age

nt fe

e,

cust

ody

fee,

sup

ervi

sory

and

fidu

ciar

y fe

e an

d au

dit f

ee.



56

8. Share Capital

Authorized and issued capital

The authorized share capital of the Company is USD 1,000,000 divided into 100 Management Shares of USD 1 par value each and 999,900,000 Participating Shares of USD 0.001 par value each.

Management Shares are non–participating and may only be issued to a member of the Manulife Group, and are issued for the purpose of enabling all the Participating Shares to be redeemed without liquidating the Company. All Management Shares have been issued to Manulife Investment Management (Hong Kong) Limited (“MIMHK”), the Investment Manager.

Participating Shares and Management Shares carry equal voting rights. The holder of a Management Share has the right to receive notice of, attend at and vote as a Shareholder at any general meeting of the Company. The holder of a Participating Share has the right to receive notice of, attend at or vote as a Shareholder at any general meeting of the Company and may vote at a separate Class meeting.

As at 30 June 2021, the below Classes of Participating Shares are available for subscription in each Segregated Portfolio:

China A Fund– Class AA, for investment by retail investors

– Class I, for investment by institutional investors only

– Class P, for investment by institutional investors only

Bond Fund– Class AA, for investment by retail investors

– Class I, for investment by institutional investors only

– Class I3, for investment by any collective investment scheme or mutual fund managed by a Manulife entity; or institutional investors who at the time of receipt of subscription have entered into an agreement with a Manulife entity in relation to fees; and, who meet the requirements as determined or waived by the General Adviser and Distributor at its sole discretion.

– Class P, for investment by institutional investors only

Asia Pacific Income and Growth Fund– Class AA (USD) Inc, for investment by retail investors

– Class AA (AUD) Inc Hedged, for investment by retail investors

– Class AA (CAD) Inc Hedged, for investment by retail investors

– Class AA (HKD) Inc, for investment by retail investors

– Class C (USD) Inc, for investment by non–retail investors who meet the minimum investment amounts required for this Class only

– Class D (USD) Inc, for investment by non–retail investors who meet the minimum investment amounts required for this Class only

– Class I (USD) Inc, for investment by institutional investors only

– Class T (USD) Inc, for investment by institutional investors only



57

8. Share Capital (continued)

Authorized and issued capital (continued)

U.S. Bank Equity Fund– Class AA (USD) Inc, for investment by retail investors


– Class I2 (RMB) Hedged, for investment by institutional investors only

– Class I3 (USD), for investment by any collective investment scheme or mutual fund managed by a Manulife entity; or institutional investors who at the time of receipt of subscription have entered into an agreement with a Manulife entity in relation to fees; and, who meet the requirements as determined or waived by the General Adviser and Distributor at its sole discretion.

Greater Bay Area Growth and Income Fund

– Class AA (USD) Inc, for investment by retail investors


– Class AA, for investment by retail investors

– Class AA (HKD), for investment by retail investors

– Class AA (AUD) Hedged, for investment by retail investors

– Class AA (AUD) Inc Hedged, for investment by retail investors

The proceeds from the issue of each Class of Participating Shares are applied to the Segregated Portfolio to which that Class relates. The proceeds from the issue of the Management Shares shall be applied to the General Assets of the Company.

Man

ulife

Adv

ance

d Fu

nd S

PCN

otes

to F

inan

cial

Sta

tem

ents

For t

he y

ear e

nded

30

June

202

1

58

8.

Shar

e C

apita

l (co

ntin

ued)

Aut

horiz

ed a

nd is

sued

cap

ital (

cont

inue

d)

Dur

ing

the

year

s en

ded

30 J

une

2021

and

30

June

202

0, th

e nu

mbe

r of R

edee

mab

le P

artic

ipat

ing

Sha

res

issu

ed, r

edee

med

and

out

stan

ding

was

as

follo

ws:

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Grow

th Fu

ndU.S

. Ban

k Equ

ity Fu

ndGr

eater

Bay A

rea Gr

owth

and I

ncom

e Fun

d

Mana

geme

ntSh

areCla

ss AA

(USD)

Class

I(US

D)Cla

ss AA

(USD)

Class

I(US

D)Cla

ss I3

(USD)

Class

AA

(USD) Inc

Class

AA

(AUD) Inc

He

dged

Class

AA

(HKD) Inc

Class

AA

(CAD) Inc

He

dged

Class

AA

(USD) Inc

Class

AA

(HKD) Inc

Class

I2

(RMB)

Hedg

edCla

ss AA

(US

D)Cla

ss AA

(US

D) Inc

Class

AA

(AUD) Inc

He

dged

Class

AA

(HKD)

Class

AA

(HKD) Inc

Balan

ce as

at 30

June

2019

4,357,

8514,0

592,0

55,930

345,16

8 2,0

51,602

840

,533

192,31

8497

,802

247,53

0 3,5

22,900

98

0,683

29,61

0 50

0,000

735,6

67 42

6,088

– 57

6,875

100

Issue

of R

edee

mable

Pa

rticipa

ting S

hares

of th

e yea

r 81

,421

– 1,9

11 –

– 42

6,311

10,73

2 23

,723

12,81

4 1,2

67,508

45

,428

– 30

,311

66,15

2 17

,604

– 94

,175

–

Rede

mptio

n of R

edee

mable

Pa

rticipa

ting S

hares

of th

e ye

ar

(1,139

,604)

–

(1,204

,539)

(59,3

28) (6

11,939

) (3

32,351

) (4

,484)

(43,9

39) (1

,000)

(2,

626,95

2) (6

94,163

) (2

9,610)

(7,49

5) (5

39,508

) (3

77,167

)–

(407,

846)

–

Balan

ce as

at 30

June

2020

3,299,

6684,0

59853

,302

285,84

0 1,4

39,663

934

,493

198,56

6477

,586

259,34

42,1

63,456

331,94

8–

522,8

16 26

2,311

66,52

5 –

263,2

04 100

Issue

of R

edee

mable

Pa

rticipa

ting S

hares

of th

e ye

ar 67

3,645

– 14

,295

– 1,6

40,571

59

2,364

8,701

28,50

7 24

,244

5,318,

954

382,5

84 –

39,25

3 1,3

88,491

50

8,096

1,983

389,4

03 –

Rede

mptio

n of R

edee

mable

Pa

rticipa

ting S

hares

of th

e ye

ar

(1,256

,649)

(4,05

9) (5

41,493

) (1

,492)

(275,

399)

(585,

414)

(3,52

5) (3

9,187)

(3,00

0)

(5,510

,476)

(452,

902)

– (3

9,059)

(260,

349)

(136,

805)

– (1

78,672

)–

Balan

ce as

at 30

June

2021

2,716,

664–

326,10

4284

,348

2,804,

835941

,443

203,74

2466

,906

280,58

81,9

71,934

261,63

0–

523,01

01,3

90,453

437,81

61,9

83473

,935

100

The

Man

agem

ent S

hare

s of

the

Com

pany

wer

e is

sued

on

14 J

uly

2008

.



59


Authorized and issued capital (continued)

No distribution of dividend or capital has been made since the inception of the China A Fund and the Bond Fund up to 30 June 2021. It is not the intention of the Company to make any distribution out of the China A Fund and the Bond Fund, although this policy may change in the future with prior written notice to Shareholders of the Company. For the Asia Pacific Income and Growth Fund, it is currently intended that dividends are declared after the end of each month and which, subject to applicable law, may be paid out of capital or gross income of the relevant Class of the Segregated Portfolio while charging/paying all or part of the Classes fees and expenses to/out of the capital of the relevant Class of the Segregated Portfolio and (unless otherwise determined by the Company) are in the respective currency of denomination of the relevant Class of the Segregated Portfolio. The dividends declared (if any) are paid within three weeks of such declaration. For the U.S. Bank Equity Fund, it is currently intended that dividends are declared on a semi-annual basis and which, subject to applicable law, may be paid out of capital or gross income of the relevant Class of the Segregated Portfolio while charging/paying all or part of the Classes fees and expenses to/out of the capital of the relevant Class of the Segregated Portfolio and (unless otherwise determined by the Company) are in the respective currency of denomination of the relevant Class of the Segregated Portfolio. The dividends declared (if any) are paid within three weeks of such declaration. For the Greater Bay Area Growth and Income Fund, in respect of Class AA (USD) Inc, Class AA (HKD) Inc, Class AA (AUD) Inc Hedged, it is currently intended that dividends are declared on a monthly basis and which, subject to applicable law, may be paid out of capital or gross income of the relevant Class of the Segregated Portfolio while charging/paying all or part of the Classes fees and expenses to/out of the capital of the relevant Class of the Segregated Portfolio and (unless otherwise determined by the Company) are in the respective currency of denomination of the relevant Class of the Segregated Portfolio. The dividends declared (if any) are paid within three weeks of such declaration. In respect of Class AA, it is not the intention of the Company to make any distributions in respect of such Classes (which are accumulation Classes) of the Greater Bay Area Growth and Income Fund, although this policy may change with prior written notice to Shareholders.

For further details on dividend distribution, please refer to the Statement of Distribution on pages 30–37.

Capital Management

As a result of the ability to issue and redeem shares, the capital of the Company can vary depending on the demand for subscriptions and redemptions to the Company. The Company is not subject to externally imposed capital requirements and has no legal restrictions on the issue or redemption of Participating Shares beyond those included in the Company’s constitution.

With a view to protecting the interests of Shareholders, the Company may limit the number of Participating Shares of any Class and/or Series which are redeemed on any Dealing Day to 10% in aggregate of the total number of Participating Shares in issue of the relevant Class and/or Series. Such limitation is applied pro rata to all Shareholders who have requested such redemption. If the redemption requests received on such Dealing Day are in excess of this limit, the Company is entitled (but not obliged) to carry out only sufficient redemptions which, in aggregate, amount to 10% of the Participating Shares in issue of the relevant Class and/or Series at the relevant time. Redemption requests for Participating Shares which are not redeemed but which would otherwise have been redeemed are deferred until the next Dealing Day and are dealt with (subject to further deferral if the deferred requests themselves exceed 10% of the Participating Shares in issue of the relevant Class and/or Series) in priority to later redemption requests. Where there is more than one Class and/or Series of Participating Shares in relation to a Segregated Portfolio, the same restriction applies to all such Classes and Series of Participating Shares.



60


Capital Management (continued)

For the China A Fund, the Bond Fund, the Asia Pacific Income and Growth Fund, the U.S. Bank Equity Fund and the Greater Bay Area Growth and Income Fund subscriptions and redemptions to the Participating Shares are dealt on each Business Day.

Man

ulife

Adv

ance

d Fu

nd S

PCN

otes

to F

inan

cial

Sta

tem

ents

For t

he y

ear e

nded

30

June

202

1

61

9.

Div

iden

d in

com

e

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

D

Equit

y sec

uritie

s des

ignate

d at fa

ir valu

e thr

ough

profi

t or lo

ss 58

4,166

53

3,593

–

– 43

8,350

44

0,571

75

4,653

87

2,638

34

6,763

24

5,832

2,

123,9

32

2,09

2,634

Fu

nds d

esign

ated a

t fair v

alue t

hroug

h profi

t or

loss

– –

– –

268

– –

– –

– 26

8 –

584,1

66

533,5

93

– –

438,6

18

440,5

71

754,6

53

872,6

38

346,7

63

245,8

32

2,12

4,200

2,

092,6

34

10.

Inte

rest

and

oth

er in

com

e

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

Intere

st inc

ome

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

D

Cash

442

2,25

5 1,

483

5,28

9 97

5 13

–

– –

– 2,

900

7,55

7 De

bt se

curiti

es de

signa

ted at

fair v

alue

throu

gh pr

ofit o

r loss

– –

1,42

3,659

1,

404,1

79

320,3

41

313,6

47

– –

212,3

65

345,0

17

1,95

6,365

2,

062,8

43

442

2,25

5 1,

425,1

42

1,40

9,468

32

1,316

31

3,660

–

– 21

2,365

34

5,017

1,

959,2

65

2,07

0,400

Man

ulife

Adv

ance

d Fu

nd S

PCN

otes

to F

inan

cial

Sta

tem

ents

For t

he y

ear e

nded

30

June

202

1

62

10.

Inte

rest

and

oth

er in

com

e (c

ontin

ued)

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

Othe

r inco

me

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

D

Comm

ission

on su

bscri

ption

s / re

demp

tions

54,86

7 36

,059

20,49

5 44

,971

74

– 21

–

231

– 75

,688

81,03

0 54

,867

36,05

9 20

,495

44,97

1 74

–

21

– 23

1 –

75,68

8 81

,030

11.

Taxa

tion

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20

For th

e yea

r en

ded 3

0 Jun

e 20

21

For th

e yea

r en

ded 3

0 Jun

e 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

D

With

holdi

ng ta

xes

(58,5

94)

(53,3

59)

– –

(40,3

11)

(39,2

68)

(225

,856)

(261

,792)

(9,57

5) (8

,072)

(334

,336)

(362

,491)

PRC

tax on

capit

al ga

ins–

– (4

,790)

(70,9

13)

– –

– –

– –

(4,79

0) (7

0,913

) (5

8,594

) (5

3,359

) (4

,790)

(70,9

13)

(40,3

11)

(39,2

68)

(225

,856)

(261

,792)

(9,57

5) (8

,072)

(339

,126)

(433

,404)



63

11. Taxation (continued)

Cayman Islands

The Government of the Cayman Islands does not, under existing legislation, impose any income, corporate or capital gains tax, estate duty, inheritance tax, gift tax or withholding tax upon the Company or the Shareholders. The Cayman Islands are not party to a double tax treaty with any country that is applicable to any payments made to or by the Company.

Hong Kong

No provision for Hong Kong profits tax has been made as the Company was authorized as a collective investment scheme under section 104 of the Hong Kong Securities and Futures Ordinance and is therefore exempt from Hong Kong profits tax under Section 26A(1A) of the Hong Kong Inland Revenue Ordinance.

Mainland China

PRC EIT of 10% is charged on PRC sourced dividends and interest on a withholding basis, subject to Caishui [2018] No. 108, according to which foreign institutional investors are exempt from EIT on bond interest income derived November 7, 2018 to November 6, 2021. In addition, the withholding tax rate may be reduced subject to the applicability of relevant double tax agreements.

On 17 November 2014, Mainland China issued the Circular CaiShui [2014] No. 79 (“Circular 79”) which clarified the PRC withholding tax treatment with respect to realized gains derived by QFIIs and RQFIIs from the trading of shares in PRC resident enterprises. QFIIs and RQFIIs are temporarily exempt from withholding tax in respect of capital gains derived from the trading of equity investments assets (including shares) starting from 17 November 2014. Realized capital gains derived prior to 17 November 2014 would be subject to withholding tax and are required to be reported to the State Taxation Bureaus in Beijing or Shanghai.

In view of the issuance of Circular 79 on 14 November 2014, the China A Fund has ceased to make provision for 10% withholding tax on realized gains derived from the trading of A-shares with effect from 17 November 2014.

The Investment Manager will continue to provide for the 10% withholding tax on capital gains arising from the trading of PRC non-equity investments assets, including fixed income investments.

As at 30 June 2021, the withholding tax provision on gross unrealized gains is USD 71,888 for the Bond Fund (30 June 2020: USD 87,585).

As at 30 June 2021, the Bond Fund’s withholding tax provision on gross realized gains is USD 569,050 (30 June 2020: USD 500,410).



64

11. Taxation (continued)

The tax law and regulations of Mainland China are constantly changing, and they may be changed with retrospective effect to the advantage or disadvantage of shareholders. The interpretation and applicability of the tax law and regulations by tax authorities may not be consistent and transparent; and may vary from region to region. It should also be noted that any provision for taxation made by the Investment Manager may be excessive or inadequate to meet final Mainland China tax liabilities. Consequently, shareholders may be advantaged or disadvantaged depending upon the final tax liabilities.

United States

A United States withholding tax of 30% is charged on United States sourced dividends. The withholding tax rate may be reduced subject to the applicability of relevant double tax agreements.

12. Fees and Charges

12.1 Management fees

MIMHK, the General Adviser and Distributor and the Investment Manager, is entitled to receive management fees at the percentage specified below per annum on the NAV of the relevant class of Participating Shares in the relevant Segregated Portfolio, accrued and calculated monthly and payable monthly in arrears.

China A Fund Bond Fund Asia Pacific Income and Growth Fund U.S. Bank Equity Fund

Greater Bay Area Growth and Income

Fund

Class AA Class I Class AA Class I Class I3

Class AA Inc(USD, AUD, HKD &

CAD)

Class AA Inc(USD & HKD)

Class I2(RMB)

Class AA (USD & HKD) & Class AA Inc (USD, AUD & HKD)

1.75% Up to 1.5% 1.25% Up to 1%

Separately agreed with the relevant Manulife

entity.

1.50% 1.50% 0.43% 1.50%

Manulife TEDA Fund Management Co. Ltd. (the “Investment Adviser”) has been appointed by the Investment Manager to provide non–binding investment advice in connection with the China A Fund’s investments through conducting market research, gathering data, making of recommendations and provision of other related advisory services.

The day–to–day investment management activities of the China A Fund have not been delegated to the Investment Adviser and the Investment Manager has sole overall responsibility for ensuring that the investment objectives, strategies, guidelines and restrictions of the China A Fund are observed and complied with in all aspects.

12.2 Custodian and Paying Agent, Administration, Registrar and Transfer Agent fees

Citibank Europe plc, Luxembourg Branch, in relation to its duties as the custodian and paying agent (including as the sub–administrator, registrar and transfer agent), is entitled to a maximum fee of 0.50% per annum of the NAV of the Segregated Portfolios, accrued and calculated on each valuation day of the Segregated Portfolios and payable monthly in arrears.



65

12. Fees and Charges (continued)

12.2 Custodian and Paying Agent, Administration, Registrar and Transfer Agent fees (continued)

FirstCaribbean International Bank and Trust Company (Cayman) Limited (formerly known as CIBC Bank and Trust Company (Cayman) Limited), in relation to its duties as the administrator and principal office, is entitled to an annual fee of 0.004% of the NAV of each Segregated Portfolio (subject to an annual minimum fee of USD 8,000 per Segregated Portfolio).

12.3 Initial, Redemption, Administrative and Switching Charges

(a) Initial Charge

The Company may, at its absolute discretion, impose an initial charge (and subsequently, at its absolute discretion, in relation to different investors increase, reduce or waive in whole or in part such initial charge) of up to the below defined maximums of the NAV per Participating Share on an investor subscribing for Participating Shares of the relevant Segregated Portfolio. Subscriptions of the units of the Segregated Portfolios are recorded net of initial charge.

China A Fund Bond Fund Asia Pacific Income and Growth Fund U.S. Bank Equity Fund

Greater Bay Area Growth and

Income Fund

Class AA Class I Class AA Class I Class I3 Class AA Inc

(USD, AUD, HKD & CAD)

Class AA Inc

(USD & HKD)

Class I2(RMB)

Class AA (USD & HKD) & Class AA Inc (USD, AUD &

HKD)

Currently up to 5% of the

NAV. The Directors

reserve the right to charge

up to 6% of the NAV per Participating

Share.


NAV. The Directors



Share.


NAV. The Directors



Share.

Up to 6% of the NAV per Participating

Share.

not applicable

Currently up to 5% of the NAV. The Directors

reserve the right to charge up to 6% of the NAV per Participating

Share.


NAV. The Directors reserve

the right to charge up

to 6% of the NAV per

ParticipatingShare.

not applicable

Currently up to 5% of the NAV per Share.

(b) Redemption Charge (inclusive of Administrative Charge)

The Company may, at its absolute discretion, impose a redemption charge (and subsequently, at its absolute discretion, in relation to different investors increase, reduce or waive in whole or in part such redemption charge) of up to a maximum of 7% (inclusive of the administrative charge set out below) of the relevant redemption proceeds on a Shareholder applying to redeem all or any of his/her Participating Shares of the relevant Segregated Portfolio.

The administrative charge is intended to cover all or part of the dealing and transaction costs (including any requisite governmental tax, stamp duty, registration fee, fiscal or currency repatriation charges, marketspreads) relating to the liquidation or disposal of the underlying investments. All redemption charges are retained in the relevant Segregated Portfolio for the benefit of continuing Shareholders as it seeks to preserve the value of the underlying assets of the relevant Segregated Portfolio against the effects of liquidation or disposal caused by redeeming Shareholders. There is no redemption charge for the Asia Pacific Income and Growth Fund, the U.S. Bank Equity Fund and the Greater Bay Area Growth and Income Fund.



66

12. Fees and Charges (continued)

(b) Redemption Charge (inclusive of Administrative Charge) (continued)

The redemption charge applicable to the China A Fund and the Bond Fund for the shares AA, I and P was 5.3% of the redemption proceeds during the lock–up period which expired on 9 February 2011 and 23 February 2011 respectively. It is reduced to 0.3% for the share AA after the lock–up period.

(c) Switching Charge (if any)

The Company may also impose a switching charge of up to 1% of NAV per Participating Share on switching requests (if any).

13. Financial risk and management objectives and policies

Introduction

The Company’s objective in managing risk is to achieve the investment objectives of each of the Segregated Portfolios. Risk is inherent in the activities of the Company, but it is managed through a process of ongoing identification, measurement and monitoring, subject to risk limits and other controls. The Company is exposed to market risk (which includes price risk, interest rate risk and foreign currency risk), credit risk and liquidity risk.

The Company monitors and manages the risks of each of the Segregated Portfolios separately.

China A Fund

The objective of the China A Fund is to achieve long term capital appreciation by investing primarily in Mainland China capital markets. The China A Fund seeks to achieve its investment objective by investing primarily (i.e. not less than 70% of its net assets) in companies listed on the A–Share markets of the Shanghai Stock Exchange and/or the Shenzhen Stock Exchange.

Bond Fund

The objective of the Bond Fund is to provide capital appreciation and income generation by investing primarily in RMB–denominated debt instruments issued and listed in Mainland China or traded in the Mainland China interbank bond market, in accordance with applicable regulations. The Bond Fund invests primarily (i.e. not less than 70% and up to 100% of its net assets) in RMB–denominated debt instruments, including convertible bonds that are listed or transferred on either the Shanghai Stock Exchange or the Shenzhen Stock Exchange, or interbank bonds traded in the China Interbank Bond Market, and which are issued by the Mainland China Government as well as corporations in Mainland China.

Asia Pacific Income and Growth Fund

The investment objective of the Asia Pacific Income and Growth Fund is to provide income and capital appreciation over the medium to longer term by investing primarily in equity and fixed income–related securities in the Asia Pacific ex–Japan region. The Asia Pacific Income and Growth Fund targets an asset allocation of 60% in equity securities and 40% in fixed income securities in that region. However the Asia Pacific Income and Growth Fund may hold between 25% and 75% in either equity securities or fixed income securities in that region in pursuance of its investment objective.



67

13. Financial risk and management objectives and policies (continued)

Introduction (continued)

U.S. Bank Equity Fund

The investment objective of the U.S. Bank Equity Fund is to achieve medium to long term growth of capital primarily through investing in equities (such as common, preferred and convertible preferred stocks) and equity-related investments (such as depositary receipts and exchange traded funds (“ETF”)) of U.S. banks (including regional banks, commercial banks, industrial banks, savings and loan associations and bank holding companies incorporated in the United States of America and/or its territories, collectively “U.S. Banks”). The U.S. Bank Equity Fund (i) shall invest at least 80% and up to 100% of its net assets in (a) equity securities of U.S. Banks, such as publicly traded common, preferred and convertible preferred stocks; and (b) other U.S. Banks focused equity-related investments such as American depositary receipts, European depositary receipts, global depositary receipts and ETFs; (ii) may invest up to 20% of its net assets in equity securities of other U.S. and foreign financial services companies and/or in cash, short term securities and money markets instruments such as bank deposits, certificates of deposits, discount notes, treasury and agency debt, or collateralised and/or securitised products (such as asset backed commercial paper); and (iii) may invest up to 5% of its net assets in equity securities of companies outside the financial services sector. Due to the nature of the U.S. Banks equity securities markets, it is expected that under normal market conditions, investment in equities of small- and mid-capitalisation companies would typically comprise between 30% and 75% of the U.S. Bank Equity Fund’s net assets.


The investment objective of the Greater Bay Area Growth and Income Fund is to achieve capital growth and income generation by investing primarily in a diversified portfolio of equity and equity-related securities and fixed income securities of issuers which are connected to the region comprising Hong Kong, Macau and the Guangdong Province of China (“Greater Bay Area”). The Greater Bay Area Growth and Income Fund will invest at least 70% of its net assets in equity and equity-related securities (which are listed on any stock exchange) and fixed income securities of governments or corporate issuers established and/or with substantial business interests in the Greater Bay Area. Equity and equity-related securities include common stocks, preferred stocks, depositary receipts and real estate investment trusts.

(a) Market risk

Market risk is the risk that changes in market variables, such as in interest rates, equity prices, and foreign currency rates will affect the fair value or future cash flows of financial instruments of the Segregated Portfolios of the Company. The market risk arising from changes in foreign currency rates is discussed in a separate section. The primary market variable to which each portfolio is exposed is the benchmark index for that portfolio. The Investment Manager manages market risk relative to that benchmark by closely monitoring all portfolio holdings of each Segregated Portfolio of the Company and attempting to maintain a high degree of diversification.

China A Fund

The Investment Manager of the China A Fund monitors its Tracking Error and Beta on an ex–post (realized) and ex–ante basis. Tracking Error is a measure of how closely a portfolio follows the index to which it is benchmarked. Beta is a number that describes the relation of portfolio returns with those of the benchmark index returns. The Investment Manager uses the Shanghai Shenzhen CSI 300 Index (“CSI 300”) as its Benchmark for both Tracking Error and Beta. As at 30 June 2021, the portfolio of the China A Fund had an ex–post Tracking Error of 7.38% (30 June 2020: 9.66%) and an ex–post Beta of 1.09 (30 June 2020: 1.03).

As at 30 June 2021, it is estimated using an industry standard risk model with ex–post Beta that had the CSI 300 increased by 5% with all other variables held constant, net assets attributable to holders of redeemable participating shares and profit would have increased by USD 2,450,455 (30 June 2020: USD 2,087,679).



68


(a) Market risk (continued)

Bond Fund

The Bond Fund is exposed to market risk from changes in interest rates and foreign currency rates. The Bond Fund does not have direct market risk exposure from changes in equity prices. The market risk arising from changes in foreign currency rates is discussed in a separate section.

Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values of financial instruments. The majority of the direct interest rate exposure of the Bond Fund arises from investments in debt securities denominated in RMB. As at 30 June 2021, most of the investments of the Bond Fund carry fixed interest rates and have an average maturity of 8.00 years (30 June 2020: 5.16 years).

The following table analyses the interest rate exposure of the Bond Fund, with assets and liabilities shown at their carrying value and categorized by the earlier of contractual re–pricing or maturity dates:

As at 30 June 2021Less than

1 year1 to 5 years

5 to 10 years

Over 10 years

Non–interest bearing Total

USD USD USD USD USD USDFinancial assets at fair value through profit or loss – 13,996,992 22,765,195 5,100,230 904,075 42,766,492 Cash and cash equivalent 228,305 – – – – 228,305 Other receivables and prepayments – – – – 594,769 594,769 Due from broker – – – – 161,620 161,620 Financial liabilities at fair value through profit or

loss – – – – (1,071,977) (1,071,977)

Accounts payable and accrued expenses – – – – (748,228) (748,228)Payable on redemptions – – – – (58,494) (58,494)

228,305 13,996,992 22,765,195 5,100,230 (218,235) 41,872,487


1 year1 to 5 years

5 to 10 years

Over 10 years


USD USD USD USD USD USDFinancial assets at fair value through profit or loss – 11,804,997 18,038,401 – – 29,843,398 Cash and cash equivalent 133,007 – – – – 133,007 Other receivables and prepayments – – – – 398,794 398,794 Accounts payable and accrued expenses – – – – (687,433) (687,433)Payable on redemptions – – – – (213,924) (213,924)

133,007 11,804,997 18,038,401 – (502,563) 29,473,842

As at 30 June 2021, an increase of the interest rate on RMB–denominated assets by 100 bps, with all other variables held constant, would have resulted to a decrease in net assets attributable to holders of Redeemable Participating Shares of USD 2,634,653 (30 June 2020: USD 1,444,361). A decrease of the interest rates on RMB denominated assets by 100 bps would have an equal but opposite effect. This arises substantially from the increase in the fair value of fixed interest securities.


The Asia Pacific Income and Growth Fund is exposed to market risk from changes in interest rates, foreign currency rates and equity prices. The market risk arising from changes in foreign currency rates is discussed in a separate section.



69



Asia Pacific Income and Growth Fund (Equity securities)

Regarding the market risk from changes in equity prices, the Investment Manager of the Asia Pacific Income and Growth Fund monitors its Tracking Error and Beta on an ex–post (realized) and ex–ante basis. Tracking Error is a measure of how closely a portfolio follows the index to which it is benchmarked. Beta is a number that describes the relation of portfolio returns with those of the benchmark index returns. The Investment Manager uses the MSCI AC Asia Pacific ex Japan index (“MSCI AC Asia Pacific ex Japan”) as its Benchmark for both Tracking Error and Beta. As at 30 June 2021, the portfolio of the Asia Pacific Income and Growth Fund had an ex–post Tracking Error of 2.77% (30 June 2020: 2.98%) and an ex–post Beta of 0.83 (30 June 2020: 1.05).

As at 30 June 2021, it is estimated with an industry standard risk model with ex–post beta that had the MSCI AC Asia Pacific ex Japan increased by 5% with all other variables held constant, net assets attributable to holders of redeemable participating shares and profit would have increased by USD 468,959 (30 June 2020: USD 474,253).

Neither MSCI nor any other party involved in or related to compiling, computing or creating the MSCI data makes any express or implied warranties or representations with respect to such data (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability or fitness for a particular purpose with respect to any of such data. Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any third party involved in or related to compiling, computing or creating the data have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages. No further distribution or dissemination of the MSCI data is permitted without MSCI’s express written consent.

Asia Pacific Income and Growth Fund (Debt securities)

Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values of financial instruments. The majority of the direct interest rate exposure of the Asia Pacific Income and Growth Fund arises from investments in debt securities denominated in USD. As at 30 June 2021, most of the investments of the Asia Pacific Income and Growth Fund carry fixed interest rates and have an average maturity of 3.85 years (30 June 2020: 3.59 years).

The following table analyses the interest rate exposure of the Asia Pacific Income and Growth Fund, with assets and liabilities shown at their carrying value and categorized by the earlier of contractual re–pricing or maturity dates:



70



Asia Pacific Income and Growth Fund (Debt securities) (continued)


1 year1 to 5 years

5 to 10 years

Over 10 years


USD USD USD USD USD USDFinancial assets at fair value through profit or loss 459,378 2,362,774 2,607,148 1,241,741 11,430,381 18,101,422 Cash and cash equivalent 66,314 – – – – 66,314 Receivable on subscriptions – – – – 24,260 24,260 Other receivables and prepayments – – – – 255,352 255,352 Due from broker – – – – 406,415 406,415 Financial liabilities at fair value through profit or

loss – – – – (28,908) (28,908)

Accounts payable and accrued expenses – – – – (117,959) (117,959)Payable on redemptions – – – – (178,306) (178,306)Due to broker – – – – (200,000) (200,000)

525,692 2,362,774 2,607,148 1,241,741 11,591,235 18,328,590


1 year1 to 5 years

5 to 10 years

Over 10 years


USD USD USD USD USD USDFinancial assets at fair value through profit or loss 201,038 2,921,527 1,821,499 1,284,936 9,033,396 15,262,396 Cash and cash equivalent 653,268 – – – – 653,268 Receivable on subscriptions – – – – 6,131 6,131 Other receivables and prepayments – – – – 185,250 185,250 Due from broker – – – – 4,249 4,249 Financial liabilities at fair value through profit or loss (6,550) – – – – (6,550)Accounts payable and accrued expenses – – – – (47,325) (47,325)Payable on redemptions – – – – (51,269) (51,269)

847,756 2,921,527 1,821,499 1,284,936 9,130,432 16,006,150

As at 30 June 2021, an increase of the interest rate on USD–denominated assets by 100 bps, with all other variables held constant, would have resulted to a decrease in net assets attributable to holders of Redeemable Participating Shares of USD 229,370 (30 June 2020: USD 205,314). A decrease of the interest rates on USD denominated assets by 100 bps would have an equal but opposite effect. This arises substantially from the increase in the fair value of fixed interest securities.


The Investment Manager of the U.S. Bank Equity Fund monitors its Tracking Error and Beta on an ex–post (realized) and ex–ante basis. Tracking Error is a measure of how closely a portfolio follows the index to which it is benchmarked. Beta is a number that describes the relation of portfolio returns with those of the benchmark index returns. The Investment Manager uses the Standard & Poor’s Composite 1500 Banks index (“S&P Composite 1500 Banks”) as its Benchmark for both Tracking Error and Beta. As at 30 June 2021, the portfolio of the U.S. Bank Equity Fund had an ex–post Tracking Error of 10.51% (30 June 2020: 4.20%) and an ex–post Beta of 0.97 (30 June 2020: 1.02).



71



U.S. Bank Equity Fund (continued)

As at 30 June 2021, it is estimated using an industry standard risk model with ex–post Beta that had the S&P Composite 1500 Banks increased by 5% with all other variables held constant, net assets attributable to holders of redeemable participating shares and profit would have increased by USD 1,397,443 (30 June 2020: USD 936,309).

Greater Bay Area Growth and Income Fund (Equity securities)

Regarding the market risk from changes in equity prices, the Investment Manager of the Greater Bay Area Growth and Income Fund monitors its Tracking Error and Beta on an ex–post (realized) and ex–ante basis. Tracking Error is a measure of how closely a portfolio follows the index to which it is benchmarked. Beta is a number that describes the relation of portfolio returns with those of the benchmark index returns. The Investment Manager uses 50% Hang Seng index and 50% CSI 300 index as its Benchmark for both Tracking Error and Beta. As at 30 June 2021, the portfolio of the Greater Bay Area Growth and Income Fund had an ex–post Tracking Error of 5.66% (30 June 2020: 4.95%) and an ex–post Beta of 0.94 (30 June 2020: 0.91).

As at 30 June 2021, it is estimated using an industry standard risk model with ex–post Beta that had the Hang Seng index and the CSI 300 index increased by 5% with all other variables held constant, net assets attributable to holders of redeemable participating shares and profit would have increased by USD 1,048,042 (30 June 2020: USD 295,304).

Greater Bay Area Growth and Income Fund (Debt securities)

Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values of financial instruments. The majority of the direct interest rate exposure of the Greater Bay Area Growth and Income Fund arises from investments in debt securities denominated in USD. As at 30 June 2021, most of the investments of the Greater Bay Area Growth and Income Fund carry fixed interest rates and have an average maturity of 3.85 years (30 June 2020: 4.59 years).

The following table analyses the interest rate exposure of the Greater Bay Area Growth and Income Fund, with assets and liabilities shown at their carrying value and categorized by the earlier of contractual re–pricing or maturity dates:


1 year1 to 5 years

5 to 10 years

Over 10 years


USD USD USD USD USD USDFinancial assets at fair value through profit or loss 201,459 3,165,705 2,708,608 1,901,578 22,298,763 30,276,113 Cash and cash equivalent 1,378,491 – – – – 1,378,491 Receivable on subscriptions – – – – 51,218 51,218 Other receivables and prepayments – – – – 267,907 267,907 Due from broker – – – – 210,299 210,299 Financial liabilities at fair value through profit or

loss – – – – (38,231) (38,231)


1,579,950 3,165,705 2,708,608 1,901,578 21,953,185 31,309,026



72



Greater Bay Area Growth and Income Fund (Debt securities) (continued)


1 year1 to 5 years

5 to 10 years

Over 10 years


USD USD USD USD USD USDFinancial assets at fair value through profit or loss 442,195 1,952,208 1,338,910 1,028,170 6,490,265 11,251,748 Cash and cash equivalent 345,819 – – – – 345,819 Receivable on subscriptions – – – – 37,140 37,140 Other receivables and prepayments – – – – 139,459 139,459 Due from broker – – – – 50,240 50,240 Financial liabilities at fair value through profit or

loss (1,314) – – – – (1,314)


786,700 1,952,208 1,338,910 1,028,170 6,516,987 11,622,975

As at 30 June 2021, an increase of the interest rate on USD–denominated assets by 100 bps, with all other variables held constant, would have resulted to a decrease in net assets attributable to holders of Redeemable Participating Shares of USD 305,197 (30 June 2020: USD 183,260). A decrease of the interest rates on USD denominated assets by 100 bps would have an equal but opposite effect. This arises substantially from the increase in the fair value of fixed interest securities.

(b) Credit risk

Credit risk is the risk that a counterparty to a financial instrument will cause a financial loss for a Segregated Portfolio by failing to discharge an obligation. The Investment Manager of the Segregated Portfolios has a process in place to confirm that counterparties to financial instruments, including brokers, are reputable. The creditworthiness of counterparties is reviewed on an annual basis.

None of the Segregated Portfolio hold financial assets which are past due or which are considered to be impaired.

The maximum credit risk exposure of the Company and of each Segregated Portfolios as at 30 June 2021 and 30 June 2020 is represented by the respective carrying amounts of the relevant financial assets in the statement of financial position.

The cash and cash equivalents of the Company and each of its Segregated Portfolios are held mainly with Citibank Europe plc, Luxembourg Branch and Citibank N.A. (Hong Kong Branch), both wholly owned indirect subsidiaries of Citigroup Inc. which had credit rating of A3 from Moody’s and BBB+ from Standard & Poor’s for long term and a rating of P-2 and A-2 respectively, for short term debt from those agencies.

China A Fund and U.S. Bank Equity Fund

The China A Fund and the U.S. Bank Equity Fund do not have investment in debt securities which exposes them to credit risk.

The cash and cash equivalents of the China A Fund and the U.S. Bank Equity Fund are held mainly with Citibank Europe plc, Luxembourg Branch.



73


(b) Credit risk (continued)

Bond Fund

The investment strategy of the Bond Fund requires that at least 85% of its investment to be in bonds issued by the Mainland China Government or by international corporations in Mainland China that carry a rating of at least BBB-/Baa3. The Bond Fund is exposed to credit risk arising from its investments in debt securities. 68.12% of the portfolio of the Bond Fund comprise of sovereign debt issued by the Mainland China Government, which are rated A by S&P, Moody’s and Fitch as at 30 June 2021 (30 June 2020: 50.20%).

As at 30 June 2021 and 30 June 2020, the Bond Fund invested in debt securities with the following credit quality, as per S&P, Moody’s and Fitch:

Credit Rating – Bond Fund 30 June 2021 30 June 2020USD USD

A 33,220,667 23,634,058

BBB 2,296,520 1,432,361

BB – 316,432

Unrated 6,345,230 4,460,547

Total Debt Security 41,862,417 29,843,398

Due to the investment objectives and strategy of the Bond Fund, it has concentration of credit risk by geographical distribution, with 98.86% of its investment in debt securities issued by an issuer domiciled in Mainland China as at 30 June 2021 (30 June 2020: 98.94%).

The following table analyses the concentration of credit risk of the investments in debt securities of Bond Fund by industrial distribution:

Concentration of credit risk – Bond Fund 30 June 2021 30 June 2020USD USD

Government 28,515,110 14,982,372

Corporate 13,347,307 14,861,026


Except for debt securities issued by the Mainland China Government, which accounted for 68.10% of the net assets attributable to holders of Redeemable Participating Shares of the Bond Fund as at 30 June 2021 (30 June 2020: 50.83%), there were no significant concentrations in the portfolio of credit risk to any individual issuer or group of issuers.

Asia Pacific Income and Growth Fund (Debt securities)

The Asia Pacific Income and Growth Fund is exposed to credit risk arising from its investments in debt securities. As at 30 June 2021 and 30 June 2020, the Asia Pacific Income and Growth Fund invested in debt securities with the following credit quality, as per S&P, Moody’s and Fitch:



74



Asia Pacific Income and Growth Fund (Debt securities) (continued)

Credit Rating – Asia Pacific Income and Growth Fund 30 June 2021 30 June 2020USD USD

AAA 166,258 164,239

AA 182,632 169,660

A 1,019,398 865,231

BBB 1,777,853 2,008,712

BB 1,991,455 1,288,388

B 399,593 808,318

Unrated 1,133,852 924,452


The following table analyses the concentration of credit risk of the investments in debt securities of Asia Pacific Income and Growth Fund by industrial distribution:

Concentration of credit risk – Asia Pacific Income and Growth Fund 30 June 2021 30 June 2020USD USD

Government 604,481 601,705

Corporate 6,066,560 5,627,295


As at 30 June 2021 and 30 June 2020, there were no significant concentrations in the portfolio of credit risk to any individual issuer or group of issuers.



75



Greater Bay Area Growth and Income Fund (Debt securities)

The Greater Bay Area Growth and Income Fund is exposed to credit risk arising from its investments in debt securities. As at 30 June 2021 and 30 June 2020, the Greater Bay Area Growth and Income Fund invested in debt securities with the following credit quality, as per S&P, Moody’s and Fitch:

Credit Rating –Greater Bay Area Growth and Income Fund 30 June 2021 30 June 2020USD USD

AA 200,194 –

A 1,232,995 1,532,471

BBB 2,146,485 844,308

BB 2,335,589 1,119,804

B 965,561 600,930

Unrated 1,096,526 663,970


Due to the investment objectives and strategy of the Greater Bay Area Growth and Income Fund, it has concentration of credit risk by geographical distribution, with 22.01% of its investment in debt securities issued by an issuer domiciled in Greater Bay Area as at 30 June 2021 (30 June 2020: 18.31%).

The following table analyses the concentration of credit risk of the investments in debt securities of the Greater Bay Area Growth and Income Fund by industrial distribution:

Concentration of credit risk –Greater Bay Area Growth and Income Fund 30 June 2021 30 June 2020USD USD

Corporate 7,977,350 4,761,483


Except for debt securities issued by an issuer domiciled in Greater Bay Area, which accounted for 5.61% of the net assets attributable to holders of Redeemable Participating Shares of the Greater Bay Area Growth and Income Fund as at 30 June 2021 (30 June 2020: 7.50%), there were no significant concentrations in the portfolio of credit risk to any individual issuer or group of issuers.



76


(c) Liquidity risk

Liquidity risk is defined as the risk that the Segregated Portfolios will encounter difficulties in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset.

Each Segregated Portfolio is exposed to the liquidity risk of meeting shareholder redemptions at each dealing date.

With a view of protecting the interest of shareholders, the Company is not bound to redeem more than 10% in aggregate of the total number of participating shares in issue of each share class of each of the Segregated Portfolios.

China A Fund

The China A Fund monitors the liquidity of its investments in equity securities through the number of Days Trade for individual equity instruments. Days Trade represents the number of days it would require to sell the entire position in an equity instrument, based on historical trading volumes and market liquidity of the equity instrument. Calculations are based on the assumption of trading 10% of average daily volume of a security in order not to impact the market price. The following table below lists the liquidity of the portfolio of the China A Fund as at 30 June 2021 and 30 June 2020:

Days Trade% of total portfolio of investments

30 June 2021 30 June 20201 Day 98.45% 99.57%2 Days 98.45% 99.57%5 Days 98.45% 99.57%

The cash and cash equivalents of the China A Fund as at 30 June 2021 constituted 0.42% of the fund (30 June 2020: 0.43%).

The maturity profile of the China A Fund’s financial liabilities as at the balance sheet date, based on the contracted undiscounted payments, was as follows:

As at 30 June 2021 On demandLess than

1 year 1 to 5 years Over 5 years TotalUSD USD USD USD USD

Accounts payable and accrued expenses – 191,873 – – 191,873

Payable on redemptions – 1,031,505 – – 1,031,505

Redeemable Participating Shares 44,106,113 – – – 44,106,113




Payable on redemptions – 324,717 – – 324,717




77


(c) Liquidity risk (continued)

Bond Fund

Due to legal restrictions, the Bond Fund may only invest in bonds listed on an exchange in Mainland China. There may not be a liquid or active market for the trading of bonds in the exchanges in Mainland China. The Investment Manager is aware of the liquidity risk associated with the investments of the Bond Fund.

The maturity profile of the Bond Fund’s financial liabilities as at the balance sheet date, based on the contracted undiscounted payments, was as follows:



Financial liabilities at fair value through profit or loss – 1,071,977 – – 1,071,977










The Asia Pacific Income and Growth Fund monitors the liquidity of its investments in equity securities through the number of Days Trade for individual equity instruments. Days Trade represents the number of days it would require to sell the entire position in an equity instrument, based on historical trading volumes and market liquidity of the equity instrument. Calculations are based on the assumption of trading 10% of average daily volume of a security in order not to impact the market price. The following table below lists the liquidity of the portfolio of the Asia Pacific Income and Growth Fund as at 30 June 2021 and 30 June 2020.

The cash and cash equivalents of the Asia Pacific Income and Growth Fund as at 30 June 2021 constituted 0.36% of the fund (30 June 2020: 4.08%).

Days Trade% of portfolio of investments


The maturity profile of the Asia Pacific Income and Growth Fund’s financial liabilities as at the balance sheet date, based on the contracted undiscounted payments, was as follows:



78



Asia Pacific Income and Growth Fund (continued)

As at 30 June 2021 On demand Less than 1 year 1 to 5 years Over 5 years TotalUSD USD USD USD USD

Financial liabilities at fair value through profit or loss – 28,908 – – 28,908



Due to broker – 200,000 – – 200,000








The U.S. Bank Equity Fund monitors the liquidity of its investments in equity securities through the number of Days Trade for individual equity instruments. Days Trade represents the number of days it would require to sell the entire position in an equity instrument, based on historical trading volumes and market liquidity of the equity instrument. Calculations are based on the assumption of trading 10% of average daily volume of a security in order not to impact the market price. The following table below lists the liquidity of the portfolio of the U.S. Bank Equity Fund as at 30 June 2021 and 30 June 2020.

The cash and cash equivalents of the U.S. Bank Equity Fund as at 30 June 2021 constituted 2.25% of the fund (30 June 2020: 2.33%).



The maturity profile of the U.S Bank Equity Fund’s financial liabilities as at the balance sheet date, based on the contracted undiscounted payments, was as follows:




Due to broker – 13,435 – – 13,435




79



U.S. Bank Equity Fund (continued)






The Greater Bay Area Growth and Income Fund monitors the liquidity of its investments in equity securities through the number of Days Trade for individual equity instruments. Days Trade represents the number of days it would require to sell the entire position in an equity instrument, based on historical trading volumes and market liquidity of the equity instrument. Calculations are based on the assumption of trading 10% of average daily volume of a security in order not to impact the market price. The following table below lists the liquidity of the portfolio of the Greater Bay Area Growth and Income Fund as at 30 June 2021 and 30 June 2020.

The cash and cash equivalents of the Greater Bay Area Growth and Income Fund as at 30 June 2021 constituted 4.40% of the fund (30 June 2020: 2.98%)



The Greater Bay Area Growth and Income Fund may invest in RMB denominated instruments and in Mainland China A-Share securities which may not be listed on an exchange or for which trading may not be conducted on a regular basis. There is also no guarantee that market making arrangements will be in place to make a market and quote a price available for this type of instruments. In the absence of an active secondary market, the Greater Bay Area Growth and Income Fund may need to hold some instruments until their maturity date. The investment Manager is aware of the liquidity risk associated with the investments of the Greater Bay Area Growth and Income Fund.

The maturity profile of Greater Bay Area Growth and Income Fund’s financial liabilities as at the balance sheet date, based on the contracted undiscounted payments, was as follows:






Due to broker – 200,000 – – 200,000




80



Greater Bay Area Growth and Income Fund (continued)






Due to broker – 95,090 – – 95,090


(d) Currency risk

Currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange rates.

The China A Fund, the Bond Fund and the Greater Bay Area Growth and Income Fund use a USD QFII Quota to invest primarily in the equity and debt instruments issued and listed in Mainland China. The functional currency of these Segregated Portfolios is the USD, while the investments of each of these both Segregated Portfolios are primarily denominated in other currencies, primarily RMB and HKD. The RMB is not, as yet, a freely convertible currency and is subject to exchange controls and restrictions. Consequently, the Company is exposed to the risk that the exchange rate of USD relative to other foreign currencies may change in a manner that has an adverse effect on the fair value or future cash flows of financial assets and liabilities denominated in currencies other than the USD.

The functional currency of the Asia Pacific Income and Growth Fund is the USD, while the investments of this Segregated Portfolio are primarily denominated in other currencies than USD. Consequently, the Company is exposed to the risk that the exchange rate of USD relative to other foreign currencies may change in a manner that has an adverse effect on the fair value or future cash flows of financial assets and liabilities denominated in currencies other than the USD.

The functional currency of U.S. Bank Equity Fund is USD and it invests primarily in USD denominated equity securities. Any devaluation of the USD could affect the value of the U.S. Bank Equity Fund’s investments. Investors whose investment in the U.S. Bank Equity Fund is via a class that is not denominated in USD may be affected by changes in the exchange rates of the USD.

Man

ulife

Adv

ance

d Fu

nd S

PCN

otes

to F

inan

cial

Sta

tem

ents

For t

he y

ear e

nded

30

June

202

1

81

13.

Fina

ncia

l ris

k an

d m

anag

emen

t obj

ectiv

es a

nd p

olic

ies

(con

tinue

d)

(d)

Cur

renc

y ris

k (c

ontin

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Had

the

US

D s

treng

then

ed b

y 5%

in r

elat

ion

to a

ll cu

rren

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, with

all

othe

r va

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eld

cons

tant

, the

net

ass

ets

attri

buta

ble

to h

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rs o

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able

P

artic

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ing

Sha

res

and

the

chan

ge in

net

ass

ets

attri

buta

ble

to h

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rs o

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eem

able

Par

ticip

atin

g S

hare

s pe

r th

e co

mpr

ehen

sive

inco

me

stat

emen

t w

ould

hav

e de

crea

sed

by th

e am

ount

s sh

own

belo

w.

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S.

Bank

Equit

y Fun

dGr

eater

Bay

Area

Gro

wth a

nd

Incom

e Fun

dCu

rrenc

y30

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

20US

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DUS

DAU

D–

– –

– 12

1,677

101,8

05–

– 31

8 29

1 CA

D–

– –

– 4

3–

– –

– HK

D 92

14

2 20

20

17

2,368

153,1

04 12

3 6

780,7

87

229,2

67

IDR

– –

– –

29,29

931

,468

– –

– –

INR

– –

– –

8,313

8,212

– –

– –

KRW

– –

– –

45,12

430

,377

– –

– –

MYR

– –

– –

4,659

6,520

– –

– –

NZD

– –

– –

5,071

15,04

1–

– –

– RM

B 2,

256,0

95

2,03

0,891

2,0

84,43

41,4

54,19

516

,240

5,168

– –

308,7

29

77,13

9 SG

D–

– –

– 46

,227

40,48

0–

– –

– TH

B–

– –

– 12

,281

12,21

6–

– –

– TW

D–

– –

– 10

4,116

67,61

7–

– –

–

A 5%

wea

keni

ng o

f the

US

D a

gain

st th

e ab

ove

curr

enci

es w

ould

hav

e re

sulte

d in

an

equa

l but

opp

osite

effe

ct o

n th

e fin

anci

al s

tate

men

t am

ount

s to

5%

of

the

amou

nts

show

n ab

ove,

on

the

basi

s th

at a

ll ot

her v

aria

bles

rem

ain

cons

tant

.



82

14. Derivatives contracts

Forwards

Forward contracts are contractual agreements to buy or sell a specified financial instrument at a specific price and date in the future. Forwards are customized contracts transacted in the OTC market. The Company has credit exposure to the counterparties of forward contracts.

The following tables set out the fair value and the notional amount of forward contracts held by the Company as at 30 June 2021 and 30 June 2020:

As at 30 June 2021

Purchased Amount Currency Sold Amount Currency Maturity Date Counterparty

Financial assets/(liabilities) at fair

value through profit or loss Notional

USD USDBond Fund

35,785,000 RMB 5,000,000 USD 09-Jul-21 Australia New Zealand Bank 536,154 5,538,051

34,697,500 RMB 5,000,000 USD 09-Jul-21 Australia New Zealand Bank 367,912 5,369,750

10,000,000 USD 71,565,260 RMB 09-Jul-21 Australia New Zealand Bank (1,071,977) 11,075,368

60,000 USD 387,641 RMB 02-Jul-21 Australia New Zealand Bank 9 59,991

(167,902) 22,043,160

Asia Pacific Income and Growth Fund1,862,263 AUD 1,413,025 USD 30-Jul-21 Citibank London (15,639) 1,397,163

15,497 AUD 11,756 USD 30-Jul-21 Citibank London (127) 11,627

21,213 CAD 17,249 USD 30-Jul-21 Citibank London (103) 17,145

2,539,043 CAD 2,065,161 USD 30-Jul-21 Citibank London (13,028) 2,052,166

19,591 USD 152,230 HKD 06-Jul-21 Citibank London (11) 19,601

(28,908) 3,497,702

Greater Bay Area Growth and Income Fund4,516,284 AUD 3,426,812 USD 30-Jul-21 Citibank London (37,928) 3,388,342

36,221 AUD 27,476 USD 30-Jul-21 Citibank London (297) 27,175

13,299 USD 17,731 AUD 30-Jul-21 Citibank London (6) 13,303

(38,231) 3,428,820



83

14. Derivatives contracts (continued)

Forwards (continued)

As at 30 June 2020

Purchased Amount Currency Sold Amount Currency Maturity Date Counterparty

Financial assets/(liabilities) at fair

value through profit or loss Notional

USD USDAsia Pacific Income and Growth Fund1,643,211 AUD 1,132,160 USD 31-Jul-20 Citibank London (3,582) 1,128,393

2,118,075 CAD 1,552,370 USD 31-Jul-20 Citibank London (2,968) 1,549,264

(6,550) 2,677,657

Greater Bay Area Growth and Income Fund15,263 AUD 10,497 USD 31-Jul-20 Citibank London (14) 10,481

556,192 AUD 383,212 USD 31-Jul-20 Citibank London (1,212) 381,937

52,228 AUD 35,807 USD 31-Jul-20 Citibank London 64 35,865

244,094 HKD 31,514 USD 02-Jul-20 Citibank London (19) 31,494

492,888 HKD 63,636 USD 03-Jul-20 Citibank London (41) 63,595

50,211 USD 389,378 HKD 03-Jul-20 Citibank London (28) 50,240

(1,250) 573,612

Man

ulife

Adv

ance

d Fu

nd S

PCN

otes

to F

inan

cial

Sta

tem

ents

For t

he y

ear e

nded

30

June

202

1

84

15.

Rec

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liatio

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Ass

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:

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A Fu

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Bank

Equit

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Area

Gro

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nd

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dCo

mbine

d30

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

2030

June

2021

30 Ju

ne 20

20US

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54

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r form

ation

expe

nses

– –

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4 37

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(25,0

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97,28

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s per

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NAV

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e 20

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as

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Net a

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ne 20

2130

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2020

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ne 20

2130

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2020

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ne 20

2130

June

2020

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Clas

s AA

(USD

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9.627

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r fina

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– –

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Man

ulife

Adv

ance

d Fu

nd S

PCN

otes

to F

inan

cial

Sta

tem

ents

For t

he y

ear e

nded

30

June

202

1

85

15.

Rec

onci

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Net

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2020

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ne 20

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June

2020

30 Ju

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June

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June

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June

2020

Clas

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11.93

2610

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– –

– –

– –

Adjus

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– –

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– –

– NA

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– –

11.93

2610

.6727

– –

– –

– –

Clas

s AA

(AUD

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edge

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ed N

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– 9.1

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– –

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(0.00

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– –

– 9.

1807

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–

– 10

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Cl

ass A

A (H

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– –

– –

– –

– –

92.58

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– –

– –

– –

– (0

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)–

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– 92

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– –

–



86

16. Related party disclosures

The following is a summary of significant related party transactions entered into during the years between the Company and the Board of Directors, the General Adviser and Distributor, Investment Managers or any entities in which those parties or their Connected Persons have a material interest. Connected persons of the Investment Manager are those as defined in the Code on Unit Trust and Mutual Funds established by SFC. All such transactions were entered into in the ordinary course of business and under normal commercial terms.

For the years ended 30 June 2021 and 30 June 2020, the major related party to the Company is MIMHK in its capacities as the General Adviser and Distributor cum the Investment Manager.

The General Adviser and Distributor, any distributor, Investment Manager and investment adviser may be members of the Manulife Group.

(a) Subscription and redemption of units of the Segregated Portfolios

As at 30 June 2021 and 30 June 2020, no Director held share of the Company.

Investment transactions with the Investment Manager and its Connected Persons are set out below:

Number of shares

Opening Balance Subscription Redemption Balance as at

year end

2021China A FundClass AA (USD) 1,141,542 251,150 (314,971) 1,077,721

Bond FundClass AA (USD) 269,204 9,234 (86,375) 192,063

Asia Pacific Income and Growth FundClass AA (USD) Inc 135,628 100,893 (64,329) 172,192

U.S. Bank Equity FundClass AA (USD) Inc 407,992 1,273,329 (1,057,993) 623,328

2020China A FundClass AA (USD) 1,476,654 42,803 (377,915) 1,141,542

Bond FundClass AA (USD) 315,939 1,710 (48,445) 269,204

Asia Pacific Income and Growth FundClass AA (USD) Inc 148,767 74,534 (87,673) 135,628

U.S. Bank Equity FundClass AA (USD) Inc 455,844 395,732 (443,584) 407,992

Apart from the above, there were no other subscriptions and redemptions of Shares of the Segregated Portfolios by the Directors, the General Adviser and Distributor, the Investment Manager, or other Connected Persons during the years ended 30 June 2021 and 2020.



87

16. Related party disclosures (continued)

(b) Directors’ remuneration

The Directors are entitled to such remuneration (if any) as may be voted at the general meeting. Each Director may be paid reasonable travel, hotel and other out–of–pocket expenses reasonably and properly incurred in the performance of his/her duties. The Directors may by resolution approve additional remuneration to any Director for any services other than such Director’s ordinary routine work as a Director. Any fees that may be paid to a Director who is also counsel to the Company, or otherwise serves it in a professional capacity, shall be in addition to such Director’s remuneration as a Director.

Notwithstanding the above, there are no existing or proposed service contracts between any of the Directors and the Company. No Director received any remuneration from the Company during the year ended 30 June 2021 (2020: Nil).

Man

ulife

Adv

ance

d Fu

nd S

PCN

otes

to F

inan

cial

Sta

tem

ents

For t

he y

ear e

nded

30

June

202

1

88

(c)

Fees

cha

rged

by

the

Gen

eral

Adv

iser

and

Dis

trib

utor

cum

the

Inve

stm

ent M

anag

er

The

Gen

eral

Adv

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and

Dis

tribu

tor r

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ved

man

agem

ent f

ees

(as

set o

ut in

Not

e 12

), ou

t of w

hich

the

amou

nts

due

to it

self

as th

e In

vest

men

t Man

ager

as

at b

alan

ce s

heet

dat

e ar

e se

t out

bel

ow:

China

A Fu

ndBo

nd Fu

ndAs

ia-Pa

cific I

ncom

e and

Gr

owth

Fund

U.S.

Bank

Equit

y Fun

dGr

eater

Bay

Area

Gro

wth a

nd

Incom

e Fun

d

Total

ma

nage

ment

fee

charg

ed du

ring

the ye

ar

Amou

nt du

e to

itself

as th

e Inv

estm

ent

Mana

ger a

s at

year

end

Total

ma

nage

ment

fee

charg

ed du

ring

the ye

ar

Amou

nt du

e to

itself

as th

e Inv

estm

ent

Mana

ger a

s at

year

end

Total

ma

nage

ment

fee

charg

ed du

ring

the ye

ar

Amou

nt du

e to

itself

as th

e Inv

estm

ent

Mana

ger a

s at

year

end

Total

ma

nage

ment

fee

charg

ed du

ring

the ye

ar

Amou

nt du

e to

itself

as th

e Inv

estm

ent

Mana

ger a

s at

year

end

Total

ma

nage

ment

fee

charg

ed du

ring

the ye

ar

Amou

nt du

e to

itself

as th

e Inv

estm

ent

Mana

ger a

s at

year

end

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

For th

e yea

r end

ed 30

June

2021

732,3

55

62,41

4 10

4,534

7,

956

266,8

25

23,01

8 39

4,780

38

,073

253,7

06

37,72

8 Fo

r the y

ear e

nded

30 Ju

ne 20

20 70

0,226

55

,813

211,6

86

13,85

0 24

8,257

20

,136

437,4

68

22,47

3 23

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89

17. Soft commission arrangements

MIMHK when acting as the Investment Manager of any Segregated Portfolio, has a fiduciary role in that it has an overriding duty to put the interests of its clients (including the Company, whose ultimate beneficiaries are the Shareholders) above its own corporate interests and personal interests in every transaction conducted.

MIMHK and Manulife Investment Management (US) LLC will not engage in any investment practice where its interests may be in conflict with the portfolios under their management. During the year covered by this financial report, no soft commission arrangements were entered into in respect of the Company’s transactions with brokers, except that of Manulife Investment Management (US) LLC, as stated below:

Investment Manager(s)/Sub-Investment Manager(s)/Investment Adviser(s) Name of the sub-funds



USD USD

Manulife Investment Management (US) LLC U.S. Bank Equity Fund 15 1,070

These soft commission arrangements include research and analysis related items.

18. Financial instruments by category

As at 30 June 2021

Assets/Liabilities

at fair value through

profit or loss CashLoans and

receivablesOther financial

liabilities Total

China A Fund (in USD)AssetsFinancial assets at fair value through profit or loss 44,955,118 – – – 44,955,118 Cash – 184,420 – – 184,420 Receivable on subscriptions – – 183,070 – 183,070 Other receivables and prepayments – – 6,883 – 6,883 LiabilitiesAccounts payable and accrued expenses – – – (191,873) (191,873)Payable on redemptions – – – (1,031,505) (1,031,505)

Total 44,955,118 184,420 189,953 (1,223,378) 44,106,113

Bond Fund (in USD)AssetsFinancial assets at fair value through profit or loss 42,766,492 – – – 42,766,492 Cash – 228,305 – – 228,305 Other receivables and prepayments – – 594,769 – 594,769 Due from broker – – 161,620 – 161,620 LiabilitiesFinancial liabilities at fair value through profit or loss (1,071,977) – – – (1,071,977)Accounts payable and accrued expenses – – – (748,228) (748,228)Payable on redemptions – – – (58,494) (58,494)

Total 41,694,515 228,305 756,389 (806,722) 41,872,487



90

As at 30 June 2021

Assets/Liabilities




liabilities Total

Asia Pacific Income and Growth Fund (in USD)AssetsFinancial assets at fair value through profit or loss 18,101,422 – – – 18,101,422 Cash – 66,314 – – 66,314 Receivable on subscriptions – – 24,260 – 24,260 Other receivables and prepayments – – 255,352 – 255,352 Due from broker – – 406,415 – 406,415 LiabilitiesFinancial liabilities at fair value through profit or loss (28,908) – – – (28,908)Accounts payable and accrued expenses – – – (117,959) (117,959)Payable on redemptions – – – (178,306) (178,306)Due to broker – – – (200,000) (200,000)

Total 18,072,514 66,314 686,027 (496,265) 18,328,590

U.S. Bank Equity Fund (in USD)AssetsFinancial assets at fair value through profit or loss 28,837,062 – – – 28,837,062 Cash – 652,587 – – 652,587 Receivable on subscriptions – – 542,893 – 542,893 Other receivables and prepayments – – 49,000 – 49,000 LiabilitiesAccounts payable and accrued expenses – – – (77,279) (77,279)Payable on redemptions – – – (928,090) (928,090)Due to broker – – – (13,435) (13,435)

Total 28,837,062 652,587 591,893 (1,018,804) 29,062,738

Greater Bay Area Growth and Income Fund (in USD)AssetsFinancial assets at fair value through profit or loss 30,276,113 – – – 30,276,113 Cash – 1,378,491 – – 1,378,491 Receivable on subscriptions – – 51,218 – 51,218 Other receivables and prepayments – – 267,907 – 267,907 Due from broker – – 210,299 – 210,299 LiabilitiesFinancial liabilities at fair value through profit or loss (38,231) – – – (38,231)Accounts payable and accrued expenses – – – (62,250) (62,250)Payable on redemptions – – – (574,521) (574,521)Due to broker – – – (200,000) (200,000)

Total 30,237,882 1,378,491 529,424 (836,771) 31,309,026

18. Financial instruments by category (continued)



91

As at 30 June 2020

Assets/Liabilities




liabilities Total

China A Fund (in USD)AssetsFinancial assets at fair value through profit or loss 40,462,494 – – – 40,462,494 Cash – 171,854 – – 171,854 Receivable on subscriptions – – 14,080 – 14,080 Other receivables and prepayments – – 957 – 957 LiabilitiesAccounts payable and accrued expenses – – – (170,267) (170,267)Payable on redemptions – – – (324,717) (324,717)

Total 40,462,494 171,854 15,037 (494,984) 40,154,401

Bond Fund (in USD)AssetsFinancial assets at fair value through profit or loss 29,843,398 – – – 29,843,398 Cash – 133,007 – – 133,007 Other receivables and prepayments – – 398,794 – 398,794 LiabilitiesAccounts payable and accrued expenses – – – (687,433) (687,433)Payable on redemptions – – – (213,924) (213,924)

Total 29,843,398 133,007 398,794 (901,357) 29,473,842

Asia Pacific Income and Growth Fund (in USD)AssetsFinancial assets at fair value through profit or loss 15,262,396 – – – 15,262,396 Cash – 653,268 – – 653,268 Receivable on subscriptions – – 6,131 – 6,131 Other receivables and prepayments – – 185,250 – 185,250 Due from broker – – 4,249 – 4,249 LiabilitiesFinancial liabilities at fair value through profit or loss (6,550) – – – (6,550)Accounts payable and accrued expenses – – – (47,325) (47,325)Payable on redemptions – – – (51,269) (51,269)

Total 15,255,846 653,268 195,630 (98,594) 16,006,150




92

As at 30 June 2020

Assets/Liabilities




liabilities Total

U.S. Bank Equity Fund (in USD)AssetsFinancial assets at fair value through profit or loss 18,310,835 – – – 18,310,835 Cash – 447,270 – – 447,270 Receivable on subscriptions – – 627,142 – 627,142 Other receivables and prepayments – – 32,451 – 32,451 Due from broker – – 18,555 – 18,555 LiabilitiesAccounts payable and accrued expenses – – – (58,902) (58,902)Payable on redemptions – – – (175,639) (175,639)

Total 18,310,835 447,270 678,148 (234,541) 19,201,712

Greater Bay Area Growth and Income Fund (in USD)AssetsFinancial assets at fair value through profit or loss 11,251,748 – – – 11,251,748 Cash – 345,819 – – 345,819 Receivable on subscriptions – – 37,140 – 37,140 Other receivables and prepayments – – 139,459 – 139,459 Due from broker – – 50,240 – 50,240 LiabilitiesFinancial liabilities at fair value through profit or loss (1,314) – – – (1,314)Accounts payable and accrued expenses – – – (70,429) (70,429)Payable on redemptions – – – (34,598) (34,598)Due to broker – – – (95,090) (95,090)

Total 11,250,434 345,819 226,839 (200,117) 11,622,975




93

19. Important events

The class AA (HKD) of the Greater Bay Area Growth and Income Fund was launched in February 2021.

The Company and the Segregated Portfolios are closely monitoring and responding to developments concerning the outbreak of COVID-19. The Investment Managers and Sub-Investment Managers, the Administrator, the Custodian and Paying Agent have all deployed business continuity arrangements to minimise interruption to business in respect of the COVID-19 pandemic.

At the time of signing this annual report there remains uncertainty regarding the full impact of COVID-19. The Board, the Investment Managers and Sub-Investment Managers and the other key service providers will continue to monitor developments and respond as appropriate.

20. Subsequent events

Subsequent to year end, the Company resolved to declare the dividend distributions of the Asia Pacific Income and the Growth Fund and the Greater Bay Area Growth and Income Fund. Please refer to below for details:

CurrencyDistribution per Share

Total Distribution

Distribution Date

Asia Pacific Income and Growth FundClass AA (USD) Inc USD 0.0350 32,958.06 9-Jul-21Class AA (USD) Inc USD 0.0350 32,209.68 9-Aug-21Class AA (USD) Inc USD 0.0350 32,016.10 8-Sep-21Class AA (USD) Inc USD 0.0350 32,062.82 11-Oct-21Class AA (AUD) Inc Hedged AUD 0.0337 6,856.30 9-Jul-21Class AA (AUD) Inc Hedged AUD 0.0337 6,881.92 9-Aug-21Class AA (AUD) Inc Hedged AUD 0.0337 6,859.53 8-Sep-21Class AA (AUD) Inc Hedged AUD 0.0337 6,885.06 11-Oct-21Class AA (HKD) Inc HKD 0.3501 163,449.79 9-Jul-21Class AA (HKD) Inc HKD 0.3501 164,024.22 9-Aug-21Class AA (HKD) Inc HKD 0.3501 164,604.93 8-Sep-21Class AA (HKD) Inc HKD 0.3501 165,182.71 11-Oct-21Class AA (CAD) Inc Hedged CAD 0.0332 9,324.19 9-Jul-21Class AA (CAD) Inc Hedged CAD 0.0332 9,358.93 9-Aug-21Class AA (CAD) Inc Hedged CAD 0.0332 9,377.62 8-Sep-21Class AA (CAD) Inc Hedged CAD 0.0332 9,412.83 11-Oct-21

Greater Bay Area Growth and Income FundClass AA (USD) Inc USD 0.0280 38,932.68 9-Jul-21Class AA (USD) Inc USD 0.0280 39,651.37 9-Aug-21Class AA (USD) Inc USD 0.0280 43,680.62 8-Sep-21Class AA (USD) Inc USD 0.0280 14,005.83 11-Oct-21Class AA (AUD) Inc Hedged AUD 0.0280 12,258.85 9-Jul-21Class AA (AUD) Inc Hedged AUD 0.0280 13,483.71 9-Aug-21Class AA (AUD) Inc Hedged AUD 0.0280 13,870.66 8-Sep-21Class AA (AUD) Inc Hedged AUD 0.0280 44,810.67 11-Oct-21Class AA (HKD) Inc HKD 0.2800 132,701.79 9-Jul-21Class AA (HKD) Inc HKD 0.2800 132,173.39 9-Aug-21Class AA (HKD) Inc HKD 0.2800 128,121.90 8-Sep-21Class AA (HKD) Inc HKD 0.2800 134,787.90 11-Oct-21



94

21. Approval of the combined financial statements

The financial statements of the Company for the year ended 30 June 2021 were authorized for issue in accordance with a resolution of the Board of Directors on 21 October 2021.


95

China A Segregated Portfolio

Portfolio of Investments As at 30 June 2021

Quantity / Par Value Description

Cost USD

Market Value USD

% of Net Assets

Listed Equities

China53,400 Amlogic Shanghai Company Limited – A 578,643 927,265 2.10

248,100 Anhui Anke Biotechnology Company Limited – A 630,620 572,115 1.30 59,530 Anhui Kouzi Distillery Company Limited – A 616,679 623,635 1.41 98,600 Beijing Shunxin Agriculture Company Limited – A 797,343 643,655 1.46

1,122,000 Boe Technology Group Company Limited – A 927,392 1,083,546 2.46 1,708,400 China Everbright Bank Company Limited – A 1,029,317 999,428 2.27

462,229 China Jushi Company Limited – A 474,430 1,109,530 2.52 175,400 China Life Insurance Company Limited – A 820,597 919,965 2.09

86,000 China Merchants Bank Company Limited–A 778,621 721,253 1.64 37,800 Chongqing Brewery Company Limited – A 310,432 1,158,023 2.63 74,300 Double Medical Technology Inc. – A 762,271 838,160 1.90

246,618 East Money Information Company Limited – A 767,513 1,251,515 2.84 172,500 Estun Automation Company Limited – A 225,969 1,042,509 2.36 492,900 Fangda Carbon New Material Technology Company Limited – A 691,338 567,547 1.29 148,000 Foryou Corp. – A 429,288 723,342 1.64

27,160 Gigadevice Semiconductor (Beijing) Inc. – A 635,326 789,817 1.79 181,724 Gree Electric Appliances Inc. – A 1,453,921 1,465,278 3.32 139,200 Guangdong Fenghua Advanced Technology Holding Company

Limited – A736,841 651,034 1.48

416,000 Haitong Securities Company Limited – A 787,512 740,391 1.68 84,400 Hefei Meiya Optoelectronic Technology Inc. – A 734,614 728,342 1.65

377,130 Hengyi Petrochemical Company Limited – A 628,634 697,475 1.58 125,100 Hongfa Technology Company Limited – A 535,791 1,213,933 2.75

85,850 Hualan Biological Engineering Inc. – A 525,468 487,348 1.10 297,600 Huatai Securities Company Limited – A 833,680 727,713 1.65 467,600 Industrial Bank Company Limited – A 1,254,118 1,487,155 3.36 176,100 Inner Mongolia Yili Industrial Group Company Limited – A 865,167 1,003,762 2.28

77,670 Jiangsu Hengli Hydraulic Company Limited – A 87,052 1,032,803 2.34 67,920 Jiangsu Hengrui Medicine Company Limited – A 794,644 714,471 1.62 26,800 Jiangsu Yanghe Brewery JSC Limited – A 713,652 859,398 1.95 77,661 Jonjee High-Tech Industrial and Commercial Group – A 486,870 505,044 1.15

2,500 Kweichow Moutai Company Limited–A 859,193 795,758 1.80 33,000 Leader Harmonious Drive System Company Limited – A 652,025 716,491 1.62

308,500 Meinian Onehealth Healthcare Holdings Company Limited – A 601,910 434,954 0.99 28,500 Naura Technology Group Company Limited – A 655,662 1,223,460 2.77 92,600 New China Life Insurance Company Limited – A 791,877 657,943 1.49

170,200 Ningbo Joyson Electronic Corp. – A 759,577 672,218 1.52 98,222 Ping an Insurance Group Company of China Limited – A 620,206 977,135 2.22

105,400 Shandong Pharmaceutical Glass Company Limited – A 632,778 553,797 1.26 232,568 Shenzhen Senior Technology Material Company Limited – A 545,786 1,489,037 3.37


96


Cost USD

Market Value USD

% of Net Assets

Listed Equities (continued)China (continued)

214,700 Sunwoda Electronics Company Limited – A 672,358 1,081,898 2.45 190,600 Shenzhen Sunlord Electronics Company Limited – A 632,859 1,143,638 2.59 178,000 Tongwei Company Limited – A 627,072 1,192,002 2.70

62,800 Tsingtao Brewery Company Limited – A 786,588 1,124,023 2.55 93,700 Walvax Biotechnology Company Limited – A 410,504 894,736 2.03 22,900 Will Semiconductor Company Limited – A 623,966 1,141,199 2.59 42,700 Wingtech Technology Company Limited – A 688,954 640,356 1.45

352,300 Wolong Electric Drive Group Company Limited – A 852,044 725,161 1.64 753,900 XCMG Construction Machinery Company Limited – A 480,870 743,230 1.69 144,100 Yantai Jereh Oilfiel Services Group Company Limited – A 721,464 996,877 2.26 347,100 Yunnan Tin Company Limited – A 789,538 861,109 1.95 210,500 Zhuzhou Kibing Group Company Limited – A 296,884 604,644 1.37

34,615,858 44,955,118 101.92

Listed Equities Total 34,615,858 44,955,118 101.92 Portfolio of Investments 34,615,858 44,955,118 101.92Other Net Liabilities (849,005) (1.92)Net Assets 44,106,113 100.00

China A Segregated Portfolio (continued)

Portfolio of Investments (continued) As at 30 June 2021


97


Cost USD

Market Value USD

% of Net Assets

Listed Supranationals, Governments and Local Public Authorities, Debt Instruments

China5,000,000* Agricultural Development Bank of China 2.250% 22/Apr/2025 699,958 748,552 1.79 5,000,000* Agricultural Development Bank of China 2.960% 17/Apr/2030 687,608 742,261 1.77

10,000,000* Agricultural Development Bank of China 3.450% 23/Sep20/25 1,532,186 1,561,059 3.73 10,000,000* Agricultural Development Bank of China 4.650% 11/May/2028 1,543,178 1,658,383 3.96 10,000,000* China (Govt of) 2.680% 21/May/2030 1,422,063 1,490,724 3.56 10,000,000* China (Govt of) 3.120% 5/Dec/2026 1,479,179 1,557,589 3.72 10,000,000* China (Govt of) 3.130% 21/Nov/2029 1,476,464 1,552,656 3.71 10,000,000* China (Govt of) 3.220% 6/Dec/2025 1,464,777 1,567,883 3.74 20,000,000* China (Govt of) 3.250% 22/Nov/2028 3,006,090 3,128,301 7.47 22,000,000* China (Govt of) 3.810% 14/Sep/2050 3,240,792 3,508,877 8.38 10,000,000* China Development Bank 3.070% 24/Mar/2024 1,537,990 1,551,649 3.71 10,000,000* China Development Bank 3.090% 18/Jun/2030 1,408,092 1,498,094 3.58 20,000,000* China Development Bank 3.430% 14/Jan/2027 2,939,052 3,109,128 7.42 10,000,000* China Development Bank 3.700% 20/Oct/2030 1,532,404 1,570,715 3.75 10,000,000* China Development Bank 3.900% 3/Aug/2040 1,469,997 1,591,353 3.80 10,000,000* Export-Import Bank of China 4.890% 26/Mar/2028 1,569,549 1,677,886 4.01

27,009,379 28,515,110 68.10 Listed Supranationals, Governments and Local Public Authorities, Debt Instruments Total 27,009,379 28,515,110 68.10

Listed Bonds

China10,000,000* Central Huijin Investment 4.230% 23/Aug/2023 1,465,890 1,581,107 3.78 10,000,000* China Life Insurance 4.280% 22/Mar/2029 1,491,200 1,563,535 3.73

2,000,000* China National Chemical Corp. 3.240% 20/Apr/2020 288,952 302,747 0.72 10,000,000* China National Chemical Corp. 3.290% 9/Apr/2025 1,419,243 1,517,198 3.63 10,000,000* China Railway Corp. 4.530% 23/Aug/2028 1,464,424 1,640,495 3.92 10,000,000* China Southern Power 3.750% 14/Jan/2024 1,479,730 1,566,594 3.74 10,000,000* Chongqing Longhu Development 3.95% 7/Jan/2026 1,546,070 1,565,762 3.74 10,000,000* Country Garden Real Estate Group 4.200 1/Apr/2025 1,499,185 1,557,868 3.72 10,000,000* ICBC 4.260% 25/Mar/2029 1,491,200 1,575,427 3.76

12,145,894 12,870,733 30.74

Renminbi Bond Segregated Portfolio


* Par value is in RMB.


98

Renminbi Bond Segregated Portfolio (continued)



Cost USD

Market Value USD

% of Net Assets

Hong Kong 3,000,000* Far East Horizon Limited 4.700% 9/Feb/2024 469,140 476,574 1.14

469,140 476,574 1.14

Listed Bonds Total 12,615,034 13,347,307 31.88

Portfolio of Investments 39,624,413 41,862,417 99.98

Forward contracts#

RMB/USD 536,154 1.28 RMB/USD 367,912 0.88 USD/RMB 9 0.00 USD/RMB (1,071,977) (2.56) Forward contracts Total (167,902) (0.40)

Other Net Assets 177,972 0.42Net Assets 41,872,487 100.00

* Par value is in RMB.# Counterparty is Australia New Zealand Bank.


99

Asia Pacific Income and Growth Segregated Portfolio



Cost USD

Market Value USD

% of Net Assets

Listed Supranationals, Governments and Local Public Authorities, Debt Instruments

Indonesia3,700,000,000* Indonesia Treasury Bond 8.250% 15/Jul/2021 293,010 255,591 1.39

293,010 255,591 1.39 Republic of Korea (South)

2,500,000,000* Export-Import Bank of Korea 7.250% 7/Dec/2024 195,771 182,632 1.00 195,771 182,632 1.00

Supranational12,000,000** International Finance Corp. 6.300% 25/Nov/2024 189,768 166,258 0.91

189,768 166,258 0.91

Listed Supranationals, Governments and Local Public Authorities, Debt Instruments Total

678,549 604,481 3.30

Listed BondsBermuda

200,000 China Oil & Gas Group Limited 4.700% 30/Jun/2026 200,000 204,133 1.12 200,000 Hopson Development Holdings 7.500% 27/Jun/2022 201,000 203,787 1.11

401,000 407,920 2.23 Cayman Islands

200,000 China Hongqiao Group 6.250% 8/Jun/2024 200,000 204,450 1.12 200,000 Country Garden Holdings Company Limited 3.875%

22/Oct/2030199,490 197,290 1.08

250,000 Geely Automobile 4.000% perp. 205,000 258,913 1.41 200,000 Honghua Group Limited 6.375% 1/Aug/2022 202,500 195,806 1.07 200,000 Sunac China Holdings Limited 7.500% 1/Feb/2024 198,116 205,333 1.12 200,000 Yuzhou Properties Company 5.380% perp. 199,700 170,690 0.93

1,204,806 1,232,482 6.73China

200,000 China Minmetals 3.750% perp. 200,000 204,287 1.12 200,000 Guangxi Financial Investment Group 3.600% 18/Nov/2023 196,500 186,000 1.01

396,500 390,287 2.13 Hong Kong

200,000 AIA Group Limited 2.700% perp. 200,000 203,489 1.11 300,000 CNAC (HK) Finbridge Company Limited 4.125% 19/Jul/2027 300,039 325,704 1.78 200,000 Lenovo Group Limited 3.421% 2/Nov/2030 200,000 208,924 1.14 200,000 Nanyang Commercial Bank Limited 5.000% 2/Dec/2022 196,400 201,378 1.10 200,000 Weichai International Hong Kong Energy Group 3.750% perp. 186,160 204,050 1.11

1,082,599 1,143,545 6.24* Par value is in IDR.** Par value is in INR.


100


Cost USD

Market Value USD

% of Net Assets

Listed Bonds (continued) India

200,000 Adani Ports & Special Economic Zone Limited 4.380% 3/Jul/2029

197,542 207,929 1.13

197,542 207,929 1.13 Indonesia

200,000 Bank Mandiri Pt 4.750% 13/May/25 198,510 223,466 1.22 200,000 Indonesia Asahan Aluminium Pt 5.450% 15/May/30 195,484 232,743 1.27 200,000 Pakuwon Jati Tbk Pt 4.880% 29/Apr/2028 200,000 208,833 1.14

593,994 665,042 3.63Jersey–Channel Islands

200,000 West China Cement Limited 4.950% 8/Jul/2026 200,000 200,000 1.09 200,000 200,000 1.09

Malaysia200,000 Genm Capital Labuan Limited 3.880% 19/Apr/2031 200,000 199,847 1.09

200,000 199,847 1.09 Republic of Korea (South)

200,000 Busan Bank 3.625% 25/Jul/2026 199,170 211,588 1.15 199,170 211,588 1.15

Singapore200,000 BOC Aviation FRN 21/May/2025 201,588 201,353 1.10 200,000 TBLA International Pte Limited 7.000% 24/Jan/2023 201,490 193,167 1.05

403,078 394,520 2.15United States

200,000 Resorts World Las Vegas 4.625% 16/Apr/2029 209,058 207,501 1.13 209,058 207,501 1.13

Virgin Islands (British)200,000 Coastal Emerald Limited 4.300% perp. 200,600 200,313 1.09 200,000 Easy Tactic Limited 11.750% 2/Aug/2023 200,000 196,750 1.07 200,000 JMH Company Limited 2.500% 9/Apr/2031 196,160 202,655 1.11 200,000 Yingde Gases Investment 6.250% 19/Jan/2023 201,480 206,181 1.13

798,240 805,899 4.40


Asia Pacific Income and Growth Segregated Portfolio (continued)



101


Cost USD

Market Value USD

% of Net Assets

Listed Equities Australia

19,061 Amcor Limited 178,072 216,367 1.18 6,227 BHP Billiton Limited 165,663 226,910 1.24 9,068 Brambles Limited 56,536 77,829 0.42

27,173 Capital Industrial REIT 63,100 75,838 0.41 4,147 Endeavour Group Limited 14,543 19,570 0.11 9,944 IPH Limited 43,724 58,192 0.32 3,074 JB Hi-Fi Limited 64,429 116,651 0.64 1,609 Macquarie Group Limited 117,705 188,835 1.03

16,359 National Australia Bank Limited 408,772 321,807 1.76 2,698 Rio Tinto Limited 148,377 256,341 1.40

39,397 Scentre Group 55,227 80,988 0.44 20,679 Transurban Group Limited 186,354 220,770 1.20

113,756 Waypoint REIT 200,636 223,606 1.22 7,815 Westpac Banking Corp. 206,507 151,329 0.83 3,532 Woodside Petroleum Limited 79,730 58,854 0.32 4,147 Woolworths Group Limited 82,134 118,633 0.65

2,071,509 2,412,520 13.17Cayman Islands

2,335 Alibaba Group Holding Limited 382,779 529,438 2.89 88,000 China Resources Cement Holdings Limited 119,016 83,623 0.46

557 Full Truck Alliance Company Limited 10,583 9,296 0.05 139,000 HKBN Limited 170,190 168,239 0.92 128,000 HKT Limited 161,629 174,373 0.95

80,000 KWG Property Holdings Limited 52,399 107,129 0.58 37,600 KWG Living Group 10,339 48,221 0.26

8,200 Tencent Holdings Limited 220,757 616,610 3.37 1,127,692 1,736,929 9.48

China294,000 Anhui Expressway Company Limited – H 227,678 191,171 1.04 374,000 China Construction Bank Corp. 298,774 294,237 1.61 351,000 Industrial & Commercial Bank of China 237,446 206,090 1.12

2,833 JD.com Inc. 239,907 222,589 1.21 15,000 Ping an Insurance 154,162 146,884 0.80 41,700 SAIC Motor Corporation Limited – A 186,598 141,782 0.77

294,000 Shenzhen Expressway Company Limited 287,554 283,918 1.56 36,841 Venustech Group Inc. – A 195,395 165,400 0.90

1,827,514 1,652,071 9.01




102


Cost USD

Market Value USD

% of Net Assets

Listed Equities (continued) Hong Kong

38,500 BOC Hong Kong Holdings Limited 125,782 130,625 0.71 205,000 China Merchants Commercial REIT 89,554 73,381 0.40

92,000 China Merchants Port Holdings 121,530 134,334 0.73 635,000 CITIC Telecom International Holdings Limited 213,002 210,132 1.15

96,000 Guangdong Investment Limited 118,472 137,949 0.75 404,000 Yuexiu Transport Infrastructure Limited 270,973 234,088 1.28

14,000 Link REIT 120,373 135,650 0.74 1,059,686 1,056,159 5.76

Indonesia487,000 Telekomunikasi Indonesia Tbk Pt 108,101 105,803 0.58

26,800 United Tractors Tbk Pt 51,001 37,430 0.20 159,102 143,233 0.78

Malaysia47,700 Malayan Banking Bhd 103,310 93,183 0.51

103,310 93,183 0.51 New Zealand

9,662 Contact Energy Limited Npv 37,637 55,845 0.30 17,731 Genesis Energy Limited Npv 30,868 42,082 0.23

68,505 97,927 0.53Republic of Korea (South)

31,261 Lotte Company Limited REIT 130,902 165,444 0.90 1,599 S-1 Corp. 110,601 116,288 0.63 9,396 Samsung Electronics Company Limited Pfd 283,994 614,913 3.36

525,497 896,645 4.89Singapore

119,000 AIMS AMP Capital Industrial REIT 130,150 130,117 0.71 21,777 Ascendas REIT 40,389 47,785 0.26

200,599 Frasers Logistics & Industrial Trust REIT 159,742 214,864 1.18 78,254 Keppel DC REIT 74,831 144,936 0.79 35,900 Mapletree Commercial Trust REIT 40,224 57,679 0.31

129,000 Mapletree Greater China Commercial Trust REIT 96,395 99,792 0.54 4,900 United Overseas Bank Limited 96,542 94,107 0.51 9,300 Venture Corp. Limited 118,398 132,887 0.73

756,671 922,167 5.03




103




Cost USD

Market Value USD

% of Net Assets

Listed Equities (continued) Taiwan

17,000 Chicony Electronics Company Limited 49,283 49,056 0.27 10,000 Chroma ATE Inc. 70,471 68,731 0.37 25,000 Formosa Plastics Corp. 80,346 92,419 0.50

4,000 GlobalWafers Company Limited 50,743 131,935 0.72 24,000 Hon Hai Precision Industry Company Limited 97,159 96,475 0.53

173,000 Inventec Company Limited 138,975 162,990 0.89 38,000 Micro-Star International Company Limited 116,166 214,808 1.17 51,000 Taiwan Semiconductor Manufacturing Company Limited 256,033 1,089,113 5.94

3,000 Wiwynn Corp. 70,989 107,350 0.59 930,165 2,012,877 10.98

Thailand443,700 Land & Houses pcl nvdr 134,524 110,059 0.60 110,700 PTT pcl nvdr 125,167 135,567 0.74

259,691 245,626 1.34

Listed Equities Total 8,889,342 11,269,337 61.48

Listed FundsUnited States

3,646 iShares MSCI India ETF 107,875 161,044 0.88 107,875 161,044 0.88

Listed Funds Total 107,875 161,044 0.88 Portfolio of Investments 15,561,753 18,101,422 98.76

Forward contracts#

AUD/USD (15,639) (0.09) AUD/USD (127) (0.00)CAD/USD (103) (0.00)CAD/USD (13,028) (0.07) USD/HKD (11) (0.00)Forward contracts Total (28,908) (0.16)

Other Net Assets 256,076 1.40Net Assets 18,328,590 100.00

# Counterparty is Citibank London.


104

U.S. Bank Equity Segregated Portfolio



Cost USD

Market Value USD

% of Net Assets

Listed EquitiesPuerto Rico

3,697 Popular Inc. 250,418 277,460 0.95 250,418 277,460 0.95

United States3,040 1st Source Corp. 136,534 140,022 0.48

23,294 5th Third Bancorp. 699,213 891,693 3.07 3,690 American Business Bank 130,475 155,903 0.54 5,100 American River Bankshares 69,412 91,800 0.32 8,155 Ameris Bancorp. 356,760 413,622 1.42 8,133 Atlantic Capital Bancshares Inc. 154,959 205,196 0.71 8,863 Atlantic Union Bankshares Corp. 305,438 321,904 1.11

19,686 Bank of America Corp. 625,932 807,717 2.78 9,148 Bank of Commerce Holdings 98,296 136,488 0.47 3,373 Bank of Marin Bancorp. 123,968 105,744 0.36 5,626 Bar Harbor Bankshares 152,625 158,541 0.55 6,304 BayCom Corp. 112,699 112,905 0.39 9,322 Berkshire Hills Bancorp. Inc. 227,197 257,008 0.88 6,597 Bryn Mawr Bank Corp. 260,808 278,393 0.96 5,289 Business First Bancshares 115,656 121,647 0.42

496 C&F Financial Corp. 25,280 25,425 0.09 14,043 Cadence Bancorp. 270,828 295,043 1.02

5,185 California Bancorp. Inc. 93,129 99,034 0.34 3,217 Cambridge Bancorp. 243,113 267,043 0.92 2,847 Camden National Corp. 120,013 135,745 0.47 4,554 Central Valley Community Bancorp. 71,426 91,535 0.31 6,986 Citizens Community Bancorp. Inc. 80,789 94,590 0.33

20,151 Citizens Financial Group 760,634 926,743 3.18 1,363 City Holding Company 100,242 102,907 0.35 7,010 Civista Bancshares Inc. 142,562 155,131 0.53 7,511 Coastal Financial Corp. 156,903 209,557 0.72

580 Codorus Valley Bancorp. Inc. 11,278 11,681 0.04 5,750 Columbia Banking System Inc. 227,568 221,548 0.76 9,748 Comerica Inc. 626,385 692,693 2.38 3,763 Community Financial Corp. (The) 115,809 132,269 0.46 3,889 County Bancorp. Inc. 95,808 133,043 0.46 3,488 Cullen Frost Bankers Inc. 346,082 390,272 1.34 4,663 Eagle Bancorp. Montana Inc. 99,161 107,715 0.37 5,737 East West Bancorp. 349,918 412,892 1.42 5,956 Equity Bancshares Inc. – Class A 164,311 183,921 0.63

989 Essa Bancorp Inc. 15,932 16,338 0.06 2,723 Evans Bancorp. Inc. 92,482 102,085 0.35


105

U.S. Bank Equity Segregated Portfolio (continued)



Cost USD

Market Value USD

% of Net Assets

Listed Equities (continued)United States (continued)

3,630 Farmers & Merchants Bancorp. Inc. 79,694 79,025 0.27 3,253 Farmers National Banc Corp. 53,931 50,324 0.17 3,273 First Bancorp. Inc. 88,018 97,274 0.33 4,503 First Bancshares Inc. 140,529 167,331 0.58 4,934 First Business Financial Services Inc. 110,297 136,425 0.47 5,015 First Community Corp. 108,055 103,911 0.36

12,841 First Financial Bancorp.. 278,694 305,102 1.05 23,518 First Horizon National Corp. 357,450 406,156 1.40

6,875 First Merchants Corp. 278,680 287,444 0.99 2,378 First Mid-Illinois Bancshares 87,704 96,214 0.33 1,923 First Northwest Bancorp. 33,922 33,845 0.12

21,402 FNB Corp. 244,503 264,315 0.91 3,350 German American Bancorp. 126,682 124,017 0.43 3,093 Glacier Bancorp. Inc. 146,407 170,826 0.59 2,092 Great Southern Bancorp. Inc. 107,804 113,868 0.39 6,462 Great Western Bancorp. Inc. 188,335 212,988 0.73

11,049 Hancock Holding Company 418,029 490,355 1.69 7,849 HBT Financial 123,165 137,201 0.47

24,751 Heritage Commerce Corp. 265,169 277,954 0.96 4,307 Heritage Financial Corp. 115,558 108,493 0.37

15,697 Horizon Bancorp. Indiana 260,722 277,209 0.95 7,893 Howard Bancorp. Inc. 120,925 128,261 0.44

67,104 Huntington Bancshares Inc. 934,401 957,909 3.30 1,688 Independent Bank Massachussetts Corp. 130,648 126,938 0.44 5,205 Independent Bank Michigan Corp. 108,202 113,833 0.39 5,008 JP Morgan Chase 632,270 775,940 2.67

42,496 Keycorp 757,112 876,267 3.02 438 Landmark Bancorp. Inc. 11,803 11,857 0.04

4,627 Level One Bancorp. Inc. 108,828 125,623 0.43 487 Limestone Bancorp. Inc. 7,957 8,045 0.03

3,363 Live Oak Bancshares Inc. 132,186 196,130 0.67 4,268 M&T Bank Corp. 605,169 624,067 2.15 8,754 Mackinac Financial Corp. 123,313 174,730 0.60 2,869 Meridian Bancorp. Inc. 59,913 58,700 0.20 5,309 Metrocity Bankshares Inc. 76,854 92,854 0.32 2,406 Mid Penn Bancorp. Inc. 60,290 65,828 0.23 3,751 Midwestone Financial Group 107,907 108,441 0.37 2,447 NBT Bancorp. Inc. 89,326 87,872 0.30 1,916 Nicolet Bankshares Inc. 130,519 135,768 0.47 3,022 Northrim Bancorp. Inc. 110,937 129,916 0.45


106

U.S. Bank Equity Segregated Portfolio (continued)



Cost USD

Market Value USD

% of Net Assets

Listed Equities (continued)United States (continued)

628 Ohio Valley Banc Corp. 14,674 15,530 0.05 11,419 Old National Bancorp. 208,673 201,660 0.69 11,763 Old Second Bancorp. Inc. 140,875 147,038 0.51 10,833 Open Bank Bancorp. 101,307 110,605 0.38 10,631 Pacific Premier Bancorp. Inc. 372,830 448,203 1.54

6,616 Pacwest Bancorp. 241,532 271,190 0.93 9,132 Pinnacle Financial Partners 631,178 804,438 2.77 2,125 Plumas Bancorp. 61,619 68,064 0.23 4,278 PNC Financial Services Group 631,810 817,867 2.81

13,654 Premier Financial Corp. 369,303 392,553 1.35 5,749 Provident Financial Holdings 94,604 99,803 0.34 3,672 QCR Holdings Inc. 151,072 177,945 0.61 1,201 Red River Bancshares Inc. 60,061 60,711 0.21

42,035 Regions Financial Corp. 727,845 845,323 2.91 6,695 Renasant Corp. 252,505 267,131 0.92

316 Riverview Bancorp. Inc. 2,041 2,272 0.01 2,056 Sandy Spring Bancorp. Inc. 82,679 90,957 0.31 2,926 SB Financial Group Inc. 52,401 54,921 0.19 6,884 Shore Bancshares Inc. 106,318 115,720 0.40 2,222 Sierra Bancorp. 59,509 56,439 0.19 1,379 South State Corp. 104,674 112,389 0.39 3,556 Southern First Bancshares Inc. 145,635 182,672 0.63 3,631 Southern Missouri Bancorp. 126,165 165,537 0.57 4,461 Stock Yards Bancorp. Inc. 195,403 227,511 0.78 1,309 SVB Financial Group 482,559 730,985 2.52

10,656 Synovus Financial Corp. 421,240 468,757 1.61 3,650 Timberland Bancorp. Inc. 100,040 103,222 0.36 7,020 Trico Bancshares 279,907 299,333 1.03

14,107 Truist Financial Corp. 710,926 785,337 2.70 13,417 US Bancorp. 664,975 762,891 2.62

3,122 Washington Trust Bancorp. 149,928 159,222 0.55 7,705 Western Alliance Bancorp. 533,262 714,562 2.46 6,766 Wells Fargo & Company 303,136 316,513 1.09

13,979 Zions Bancorp. 664,605 737,252 2.54 24,946,824 28,559,602 98.27

Listed Equities Total 25,197,242 28,837,062 99.22Portfolio of Investments 25,197,242 28,837,062 99.22Other Net Assets 225,676 0.78Net Assets 29,062,738 100.00


107

Greater Bay Area Growth and Income Segregated Portfolio



Cost USD

Market Value USD

% of Net Assets

Listed BondsBermuda

200,000 China Oil & Gas Group Limited 4.700% 30/Jun/2026 200,000 204,133 0.65 200,000 204,133 0.65

Cayman Islands200,000 21Vianet Group Inc. 7.875% 15/Oct/2021 202,600 201,459 0.64 250,000 Agile Group Holdings Limited 7.875% perp. 255,250 255,813 0.82 200,000 CDBL Funding 2 2.000% 4/Mar/2026 198,572 199,031 0.64 300,000 China Aoyuan Group 5.880% 1/Mar/2027 286,350 247,500 0.79 200,000 China Hongqiao Group 6.250% 8/Jun/2024 200,000 204,450 0.65 300,000 Country Garden Holdings 3.300% 12/Jan/2031 282,900 283,031 0.90 200,000 Geely Automobile 4.000% perp. 207,400 207,130 0.66 200,000 Health and Happiness 5.625% 24/Oct/2024 200,000 207,056 0.66 200,000 KWG Group Holdings Limited 7.400% 13/Jan/2027 199,480 200,750 0.64 200,000 Shimao Group Holdings Limited 3.450% 11/Jan/2031 189,750 186,862 0.60 200,000 Sunac China Holdings 6.500% 26/Jan/2026 190,500 193,167 0.62 200,000 Times China Holdings Limited 5.750% 14/Jan/2027 203,400 191,250 0.61 200,000 Weibo Corp. 3.375% 8/Jul/2030 201,214 205,597 0.66 200,000 Zhenro Properties Group Limited 6.700% 4/Aug/2026 198,680 179,142 0.57

3,016,096 2,962,238 9.46China

200,000 Guangzhou Development District 2.600% 15/Dec/2023 200,544 201,511 0.64 200,000 Zhongan Online P&C Insurance 3.125% 16/Jul/2025 200,000 200,672 0.64

400,544 402,183 1.28Hong Kong

200,000 AIA Group Limited 2.700% perp. 200,000 203,488 0.65 200,000 Airport Authority Hong Kong 2.400% perp. 200,000 200,194 0.64 200,000 Bank of China (Hong Kong) 5.900% perp. 199,500 215,926 0.69 200,000 Far East Horizon Limited 4.350% perp. 202,700 200,682 0.64 200,000 Hbis Group Hong Kong Company Limited 3.750% 18/Dec/2022 187,000 197,000 0.63 200,000 Lenovo Group Limited 5.875% 24/Apr/2025 227,718 227,368 0.73 200,000 Vanke Real Estate (Hong Kong) 3.500% 12/Nov/2029 198,682 207,185 0.66 300,000 Westwood Group Holdings Limited 2.800% 20/Jan/2026 303,153 304,350 0.97

1,718,753 1,756,193 5.61Jersey – Channel Islands

200,000 West China Cement Limited 4.950% 8/Jul/2026 200,000 200,000 0.64 200,000 200,000 0.64


108


Cost USD

Market Value USD

% of Net Assets

Listed Bonds (continued)Virgin Islands (British)

200,000 Champion Path Holding 4.850% 27/Jan/2028 200,000 209,438 0.67 300,000 Chinalco Capital Holdings Limited 2.125% 3/Jun/2026 297,906 298,806 0.95 200,000 Coastal Emerald Limited 4.300% perp. 199,400 200,313 0.64 200,000 Easy Tactic Limited 11.750% 2/Aug/2023 200,000 196,750 0.63 200,000 Elect Global Investments Limited 4.100% perp. 203,000 205,128 0.66 200,000 GZ Metro Investment Finance BVI 2.310% 17/Sep/2030 198,566 191,065 0.61 200,000 JMH Company Limited 2.500% 9/Apr/2031 196,160 202,655 0.65 200,000 NWS Holdings 5.750% perp. 200,000 212,904 0.68 200,000 Road King Infrastructure 5.900% 5/Mar/2025 206,600 208,111 0.66 200,000 Shenzhen Investment Holdings Company 4.350% 26/Sep/2023 198,926 211,581 0.68 300,000 Studio City Finance 6.000% 15/Jul/2025 314,850 315,852 1.01

2,415,408 2,452,603 7.84


Listed EquitiesCayman Islands

30,000 AKESO Inc. 225,910 242,006 0.77 240,000 China Education Group Holdings Limited 552,371 535,234 1.71 200,000 China Lesso Group Holdings Limited 438,767 493,412 1.58

90,000 China Meidong Auto Holdings Limited 454,437 490,773 1.57 60,000 China Resources Land Limited 273,370 242,972 0.78 50,000 China Resources Mixc Lifesty Services Limited 308,152 342,182 1.09 50,000 EC Healthcare 56,948 90,004 0.29 31,041 Iclick Interactive Asia Group 300,891 335,553 1.07

150,000 Jinxin Fertility Group Limited 389,981 378,557 1.21 104,000 Jiumaojiu International Holdings Limited 433,297 425,169 1.36 400,000 KWG Living Group 406,087 512,984 1.64 300,000 KWG Property Holdings Limited 468,226 401,734 1.28

10,000 LexinFintech Holdings Limited 89,391 123,600 0.39 104,000 SITC International Holdings Company Limited 404,112 434,543 1.39

6,000 Tencent Holdings Limited 486,634 451,179 1.44 270,000 WEIMOB Inc. 583,192 595,185 1.91

40,000 Wharf Real Estate Investment Company Limited 236,762 232,542 0.74 297,000 Xin Point Holdings Limited 152,072 142,260 0.45

50,000 Yeahka Limited 353,716 314,499 1.00 6,614,316 6,784,388 21.67

Greater Bay Area Growth and Income Segregated Portfolio (continued)



109




Cost USD

Market Value USD

% of Net Assets

Listed Equities (continued)China

60,000 A-Living Services Company Limited 249,506 298,597 0.95 18,000 BYD Company Limited 503,677 538,169 1.72 80,000 China Merchants Bank Company Limited – H 663,555 682,434 2.19 60,000 China Merchants Securities Company Limited – A 201,059 176,611 0.56

150,000 China Merchants Securities Company Limited – H 226,609 208,593 0.67 75,000 China Merchants Shekou Industrial Company Limited – A 143,194 127,096 0.41 78,000 Country Garden Services Holdings Company Limited 790,270 842,637 2.70 50,000 Da An Gene Company Limited – A 167,174 164,354 0.52 15,000 Eve Energy Company Limited – A 249,239 241,262 0.77 60,000 Foryou Corp. – A 284,052 293,237 0.94 25,000 Ganfeng Lithium Company Limited 346,925 373,407 1.19 99,923 Guangdong Hybribio Biotech Company Limited 490,417 510,466 1.63 35,000 Guangzhou KDT Machinery Company Limited – A 218,642 209,892 0.67 20,000 Guangzhou Tinci Materials Technology Company Limited 303,756 329,884 1.05 20,000 Huizhou Desay SV Automotive Company Limited – A 341,893 340,717 1.09 59,992 Keshun Waterproof Technology Company Limited – A 338,765 291,898 0.93

138,000 Kingfa Sci & Tech Company Limited 468,931 445,502 1.42 138,000 Ming Yang Smart Energy Group Limited 331,679 345,766 1.10

90,000 Ninestar Corp. – A 398,232 448,492 1.43 180,976 Ping an Bank Company Limited 623,164 633,534 2.02

40,000 Ping an Insurance 455,389 391,691 1.25 300,000 Shenzhen Expressway Company Limited 311,880 289,712 0.93

20,000 Shenzhen Inovance Technology Company Limited – A 205,455 229,848 0.73 22,000 Shenzhen S.C New Energy Technology Corp. – A 393,730 394,979 1.26

159,939 Shenzhen Sunline Tech Company Limited – A 459,476 452,962 1.45 40,000 Shenzhen Sunlord Electronics Company Limited – A 230,991 240,000 0.77

100,000 Shenzhen Topband Company Limited 231,866 278,412 0.89 9,629,526 9,780,152 31.24


110




Cost USD

Market Value USD

% of Net Assets

Listed Equities (continued)Hong Kong

65,000 AIA Group Limited 802,977 807,653 2.58 40,000 ASM Pacific Techology 527,957 541,826 1.73

100,000 BOC Hong Kong Holdings Limited 347,364 339,285 1.08 300,000 China Merchants Port Holdings 493,550 438,045 1.40 450,000 Guangdong Investment Limited 699,889 646,638 2.07

20,000 Hang Seng Bank 413,551 399,417 1.28 12,000 Hong Kong Exchanges & Clearing Limited 660,985 715,086 2.28 50,000 Link REIT 477,888 484,463 1.55 15,000 Sun Hung Kai Properties Limited 228,574 223,465 0.71 30,000 Techtronic Industries Company Limited 499,102 523,800 1.67

5,151,837 5,119,678 16.35United Kingdom

70,000 HSBC Holdings plc 436,283 404,245 1.29 436,283 404,245 1.29

United States2,000 ACM Research Inc. 197,382 210,300 0.67

197,382 210,300 0.67

Listed Equities Total 22,029,344 22,298,763 71.22Portfolio of Investments 29,980,145 30,276,113 96.70

Forward contracts#

AUD/USD (37,928) (0.12) AUD/USD (297) (0.00)USD/AUD (6) (0.00)Forward contracts Total (38,231) (0.12)

Other Net Assets 1,071,144 3.42Net Assets 31,309,026 100.00

# Counterparty is Citibank London.

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gin Isl

ands

(Britis

h)–

– –

– 80

5,899

81

4,262

–

– 2,

452,6

03

1,95

9,168

3,

258,5

02

2,77

3,430

Supra

natio

nals,

Gove

rnmen

ts an

d Loc

al Pu

blic A

uthori

ties,

Debt

Instru

ments

– –

28,51

5,110

14

,982,3

72

604,4

81

601,7

05

– –

– –

29,11

9,591

15

,584,0

77

China

– –

28,51

5,110

14

,982,3

72

– –

– –

– –

28,51

5,110

14

,982,3

72

Indon

esia

– –

– –

255,5

91

267,8

06

– –

– –

255,5

91

267,8

06

Repu

blic of

Korea

(Sou

th)–

– –

– 18

2,632

16

9,660

–

– –

– 18

2,632

16

9,660

Su

prana

tional

– –

– –

166,2

58

164,2

39

– –

– –

166,2

58

164,2

39

Fund

s–

– –

– 16

1,044

10

5,880

–

– –

– 16

1,044

10

5,880

Un

ited St

ates

– –

– –

161,0

44

105,8

80

– –

– –

161,0

44

105,8

80

Deriv

ative

s–

– 90

4,075

–

– –

– –

– 64

90

4,075

64

Fo

rward

curren

cy con

tracts

– –

904,0

75

– –

– –

– –

64

904,0

75

64

Total

finan

cial a

ssets

at fa

ir valu

e thro

ugh

profit

or los

s 44

,955,1

18

40,46

2,494

42

,766,4

92

29,84

3,398

18

,101,4

22

15,26

2,396

28

,837,0

62

18,31

0,835

30

,276,1

13

11,25

1,748

16

4,936

,207

115,1

30,87

1

Stat

emen

t of M

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ents

in In

vest

men

t Por

tfolio

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For t

he y

ear e

nded

30

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202

1 (c

ontin

ued)

Man

ulife

Adv

ance

d Fu

nd S

PC

113

Stat

emen

t of M

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in In

vest

men

t Por

tfolio

s (c

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ued)

For t

he y

ear e

nded

30

June

202

1 (c

ontin

ued)

Finan

cial li

abilit

ies at

fair v

alue t

hroug

h pro

fit or

loss

China

A Fu

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nd Fu

ndAs

ia Pa

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Gr

owth

Fund

U.S. B

ank E

quity

Fund

Grea

ter Ba

y Area

Grow

th an

d Inc

ome F

und

Comb

ined

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

30 Ju

ne 20

2130

June

2020

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

Finan

cial li

abilit

ies

Deriv

ative

s–

– (1

,071,9

77)

– (2

8,908

) (6

,550)

– –

(38,2

31)

(1,31

4) (1

,139,1

16)

(7,86

4)Fo

rward

curre

ncy c

ontra

cts–

– (1

,071,9

77)

– (2

8,908

) (6

,550)

– –

(38,2

31)

(1,31

4) (1

,139,1

16)

(7,86

4)To

tal fin

ancia

l liab

ilities

at fa

ir valu

e thr

ough

profi

t or lo

ss–

– (1

,071,9

77)

– (2

8,908

) (6

,550)

– –

(38,2

31)

(1,31

4) (1

,139,1

16)

(7,86

4)

Man

ulife

Adv

ance

d Fu

nd S

PC

114

Perf

orm

ance

Tab

le

As

at 3

0 Ju

ne 2

021

and

30 J

une

2020

(Per

form

ance

reco

rd s

ince

ince

ptio

n)

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

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Gr

owth

Fund

U.S.Ba

nk

Equit

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dGr

eater

Bay A

rea G

rowth

and

Incom

e Fun

d

Class

Class

AA

Class

ICla

ss P

Class

AA

Class

ICla

ss I3

Class

AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Inc

Class

AA

Inc

Hedg

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ss AA

Inc

Class

AA

IncCla

ss I2

He

dged

Cla

ss AA

Cla

ss AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Class

AA

IncUS

DUS

DUS

DUS

DUS

DUS

DUS

DAU

DHK

DCA

DUS

DHK

DRM

BUS

DUS

DAU

DHK

DHK

DAs

at 30

June

2021

Total

Net

Asse

t Valu

e44

,106,1

13–

– 4,4

31,57

33,9

71,98

833

,468,9

269,0

63,69

21,8

70,48

945

,046,2

562,5

50,42

124

,834,5

5232

,837,4

73–

6,249

,551

15,08

6,989

4,528

,604

183,4

0850

,879,4

23

Net A

sset

Value

per S

hare

16.23

54–

– 13

.5894

13.96

8811.

9326

9.627

49.1

807

96.47

829.0

896

12.59

4012

5.5111

– 11.

9492

10.85

0410

.3436

92.51

1110

7.355

3

As at

30 Ju

ne 20

20To

tal N

et As

set V

alue

40,09

7,366

57,03

5–

10,50

1,718

3,607

,067

15,36

5,057

8,031

,638

1,643

,670

41,04

7,847

2,118

,485

16,04

2,952

24,48

1,580

– 5,4

04,06

32,5

41,82

862

1,231

– 25

,192,4

82

Net A

sset

Value

per S

hare

12.15

1914

.0529

– 12

.3072

12.61

9210

.6727

8.594

78.2

777

85.94

868.1

686

7.415

473

.7512

– 10

.3364

9.690

19.3

383

– 95

.7146

As at

30 Ju

ne 20

19To

tal N

et As

set V

alue

42,18

8,601

45,32

4–

25,01

3,911

4,294

,116

21,37

0,024

7,853

,360

1,768

,520

46,84

3,852

2,225

,765

36,51

0,568

101,83

2,859

3,147

,207

4,784

,567

6,842

,832

3,913

,948

– 53

,406,3

95

Net A

sset

Value

per S

hare

9.6811

11.16

73–

12.16

6712

.4406

10.41

639.3

433

9.195

894

.1014

8.991

910

.3638

103.8

387

106.2

890

9.569

19.3

015

9.185

8–

92.57

88

As at

30 Ju

ne 20

18To

tal N

et As

set V

alue

49,03

7,881

2,274

,612

– 26

,347,4

074,9

15,53

1–

7,724

,383

1,932

,378

44,23

2,215

2,056

,479

50,36

8,754

130,22

0,258

– 4,7

78,28

83,9

40,10

035

8,321

– 18

,046,4

45

Net A

sset

Value

per S

hare

10.01

7111.

5263

– 12

.1408

12.38

32–

9.281

09.2

289

93.90

039.0

507

11.77

41118

.5458

– 9.5

566

9.554

39.5

385

– 95

.5612

As at

30 Ju

ne 20

17To

tal N

et As

set V

alue

63,39

6,864

2,221

,498

– 29

,179,5

224,8

12,55

3–

5,220

,568

1,720

,393

40,28

9,559

2,130

,603

2,738

,585

22,55

2,402

– –

– –

– –

Net A

sset

Value

per S

hare

9.6911

11.12

35–

11.55

3311.

7542

– 9.3

434

9.342

294

.0450

9.212

210

.5190

105.3

851

– –

– –

– –

Man

ulife

Adv

ance

d Fu

nd S

PC

115

Perf

orm

ance

Tab

le (c

ontin

ued)

As

at 3

0 Ju

ne 2

021

and

30 J

une

2020

(Per

form

ance

reco

rd s

ince

ince

ptio

n) (c

ontin

ued)

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

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Gr

owth

Fund

U.S.Ba

nk

Equit

y Fun

dGr

eater

Bay A

rea G

rowth

and

Incom

e Fun

d

Class

Class

AA

Class

ICla

ss P

Class

AA

Class

ICla

ss I3

Class

AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Inc

Class

AA

IncCla

ss I2

He

dged

Cla

ss AA

Cla

ss AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Class

AA

IncUS

DUS

DUS

DUS

DUS

DUS

DUS

DAU

DHK

DCA

DUS

DHK

DRM

BUS

DUS

DAU

DHK

DHK

DAs

at 30

June

2016

Total

Net

Asse

t Valu

e88,

152,85

61,9

86,55

7–

36,36

7,956

6,137

,784

– 4,7

92,07

21,3

58,93

936

,841,8

731,7

53,07

2–

– –

– –

– –

–

Net A

sset

Value

per S

hare

8.687

89.9

471

– 11.

8319

12.00

76–

8.754

88.7

81187

.6050

8.709

4–

– –

– –

– –

–

As at

30 Ju

ne 20

15To

tal N

et As

set V

alue

149,99

3,132

3,900

,421

– 42

,725,1

9510

,436,2

80–

5,233

,113

1,367

,893

39,95

7,130

1,994

,472

– –

– –

– –

– –

Net A

sset

Value

per S

hare

12.31

3614

.0613

– 12

.0495

12.19

64–

9.704

39.7

690

97.02

839.7

204

– –

– –

– –

– –

As at

30 Ju

ne 20

14To

tal N

et As

set V

alue

96,989

,445

9,606

,420

– 51

,241,4

4414

,246,4

64–

4,379

,533

1,058

,496

575,5

4897

8,123

– –

– –

– –

– –

Net A

sset

Value

per S

hare

6.622

87.5

438

– 11.

3180

11.42

53–

10.12

8210

.1423

101.2

458

10.12

93–

– –

– –

– –

–

As at

30 Ju

ne 20

13To

tal N

et As

set V

alue

110,96

9,464

9,740

,060

31,90

5,003

61,28

0,837

36,86

8,938

– –

– –

– –

– –

– –

– –

–

Net A

sset

Value

per S

hare

6.720

07.6

349

7.976

311.

4435

11.51

62–

– –

– –

– –

– –

– –

– –

As at

30 Ju

ne 20

12To

tal N

et As

set V

alue

79,874

,341

212,6

9635

,069,4

2828

,785,4

4050

,241,1

02–

– –

– –

– –

– –

– –

– –

Net A

sset

Value

per S

hare

7.516

58.5

187

8.767

410

.9262

10.97

33–

– –

– –

– –

– –

– –

– –

Man

ulife

Adv

ance

d Fu

nd S

PC

116

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S.Ba

nk

Equit

y Fun

dGr

eater

Bay A

rea G

rowth

and

Incom

e Fun

d

Class

Class

AA

Class

ICla

ss P

Class

AA

Class

ICla

ss I3

Class

AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Inc

Class

AA

IncCla

ss I2

He

dged

Cla

ss AA

Cla

ss AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Class

AA

IncUS

DUS

DUS

DUS

DUS

DUS

DUS

DAU

DHK

DCA

DUS

DHK

DRM

BUS

DUS

DAU

DHK

DHK

DAs

at 30

June

2011

Total

Net

Asse

t Valu

e100

,861,1

972,4

29,83

241

,872,2

8426

,834,7

9441

,053,3

02–

– –

– –

– –

– –

– –

– –

Net A

sset

Value

per S

hare

9.129

010

.3203

10.46

8110

.2728

10.28

76–

– –

– –

– –

– –

– –

– –

Perf

orm

ance

Tab

le (c

ontin

ued)

As

at 3

0 Ju

ne 2

021

and

30 J

une

2020

(Per

form

ance

reco

rd s

ince

ince

ptio

n) (c

ontin

ued)

(1)

No

trans

actio

n du

ring

the

year

/per

iod

Man

ulife

Adv

ance

d Fu

nd S

PC

117

Perf

orm

ance

Tab

le (c

ontin

ued)

As

at 3

0 Ju

ne 2

021

and

30 J

une

2020

(Per

form

ance

reco

rd s

ince

ince

ptio

n) (c

ontin

ued)

China

A Fu

ndBo

nd Fu

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Gr

owth

Fund

U.S.Ba

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Equit

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dGr

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Bay A

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rowth

and

Incom

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d

Class

Class

AA

Class

ICla

ss P

Class

AA

Class

ICla

ss I3

Class

AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Inc

Class

AA

IncCla

ss I2

He

dged

Cla

ss AA

Cla

ss AA

Inc

Class

AA

Inc

Hedg

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ss AA

Class

AA

IncUS

DUS

DUS

DUS

DUS

DUS

DUS

DAU

DHK

DCA

DUS

DHK

DRM

BUS

DUS

DAU

DHK

DHK

DFo

r the y

ear e

nded

30

June

2021

Highe

st iss

ue pr

ice pe

r sh

are17

.6039

n/a (1)

– 13

.8175

n/a (1)

11.45

199.9

786

9.4116

98.37

679.3

043

13.71

5313

5.822

7–

12.74

7812

.1967

11.19

4610

0.000

012

0.913

7

Lowe

st red

empti

on pr

ice

per s

hare

12.51

3616

.3648

– 12

.2952

12.88

0410

.8933

8.691

78.8

159

87.62

098.9

504

6.759

768

.3944

– 10

.7389

9.766

89.5

768

n/a (1)

96.91

67

For th

e yea

r end

ed 30

Ju

ne 20

20Hig

hest

issue

price

per

share

12.23

75n/a

(1)–

12.43

94n/a

(1)n/a

(1)9.6

479

9.290

895

.3926

9.115

911.

6631

115.87

17n/a

(1)10

.3432

9.809

39.3

321

– 97

.7160

Lowe

st red

empti

on pr

ice

per s

hare

8.920

2n/a

(1)–

11.75

1912

.4766

10.57

777.1

404

8.043

477

.2043

8.808

75.8

952

58.67

30116

.3403

9.674

68.2

288

8.204

3–

81.27

15

For th

e yea

r end

ed 30

Ju

ne 20

19Hig

hest

issue

price

per

share

11.06

48n/a

(1)–

12.41

61n/a

(1)10

.5962

9.389

29.2

157

94.22

299.0

353

12.23

2412

3.216

110

0.000

0n/a

(1)9.5

836

9.490

9–

95.94

53

Lowe

st red

empti

on pr

ice

per s

hare

7.864

79.8

282

– 11.

7138

11.98

01n/a

(1)8.4

596

8.539

686

.3896

8.349

38.7

776

88.24

57n/a

(1)n/a

(1)8.3

556

8.436

9–

82.28

42

(1)

No

trans

actio

n du

ring

the

year

/per

iod

Man

ulife

Adv

ance

d Fu

nd S

PC

118

Perf

orm

ance

Tab

le (c

ontin

ued)

As

at 3

0 Ju

ne 2

021

and

30 J

une

2020

(Per

form

ance

reco

rd s

ince

ince

ptio

n) (c

ontin

ued)

China

A Fu

ndBo

nd Fu

ndAs

ia Pa

cific I

ncom

e and

Gr

owth

Fund

U.S.Ba

nk

Equit

y Fun

dGr

eater

Bay A

rea G

rowth

and

Incom

e Fun

d

Class

Class

AA

Class

ICla

ss P

Class

AA

Class

ICla

ss I3

Class

AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Inc

Class

AA

IncCla

ss I2

He

dged

Cla

ss AA

Cla

ss AA

Inc

Class

AA

Inc

Hedg

edCla

ss AA

Class

AA

IncUS

DUS

DUS

DUS

DUS

DUS

DUS

DAU

DHK

DCA

DUS

DHK

DRM

BUS

DUS

DAU

DHK

DHK

DFo

r the y

ear e

nded

30

June

2018

Highe

st iss

ue pr

ice pe

r sh

are12

.1382

n/a (1)

– 12

.7771

n/a (1)

– 10

.3492

10.02

4710

1.280

59.8

498

12.37

1712

4.557

0–

10.00

0010

.0000

10.00

00–

100.0

312

Lowe

st red

empti

on pr

ice

per s

hare

9.632

512

.6521

– 11.

5145

11.73

54–

9.219

99.3

889

97.06

009.1

924

10.55

7410

8.318

7–

n/a (1)

n/a (1)

n/a (1)

– n/a

(1)

For th

e yea

r end

ed 30

Ju

ne 20

17Hig

hest

issue

price

per

share

9.6911

n/a (1)

– 11.

8504

n/a (1)

– 9.4

041

9.370

694

.1913

9.245

310

.5245

102.5

134

– –

– –

– –

Lowe

st red

empti

on pr

ice

per s

hare

8.377

4n/a

(1)–

11.22

8611.

5958

– 8.5

663

n/a (1)

86.96

23n/a

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1.56%


Audited Financial Statementsfor the year ended 30 June 2021

Annual Report


Documents

Annual Report Manulife Advanced Fund SPC