COWAN ASSET MANAGEMENT POOLED FUNDS · 137,920 166,779 139,152 (2,923) (1,232) 301,776 137,920 See accompanying notes to the financial statements COWAN INCOME OPPORTUNITIES FUND STATEMENT

COWAN ASSET MANAGEMENTPOOLED FUNDS

FINANCIAL STATEMENTS

DECEMBER 31, 2017

COWAN ABSOLUTE RETURN FUND

COWAN INCOME OPPORTUNITIES FUND

COWAN ABSOLUTE RETURN FUND STATEMENT OF FINANCIAL POSITION

AS AT DECEMBER 31ST

2017 2016

$ 27,442,037 $ 14,685,245Cash 38,373 283,291

6,519,480 2,397,05057,449 27,736

34,057,339 17,393,322

Payable for investments purchased $ $ 3,025

Redemptions payable 22,650 12,500

89,584 92,797112,234 108,322

Net assets attributable to holders of redeemable units $ 33,945,105 $ 17,285,000

$ 130.27 $ 121.48

See accompanying notes to the financial statements

Other accrued expenses

Assets

Subscription receivableDividends receivable

Liabilities

Non-derivative financial assets (note 4)

Net assets attributable to holders of redeemable units per unit

2

COWAN ABSOLUTE RETURN FUND STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED DECEMBER 31ST

2017 2016

IncomeInterest for distribution purposes $ 7,448 $ 4,026

412,915 301,208

Other changes in fair value of investments209,492 1,931,878

1,308 (3,423)13,861 15,362

Change in unrealized appreciation (depreciation) of investments 1,067,646 (436,689)1,712,670 1,812,362

Expenses (notes 8, 9 and 10)4,040 2,441

Transaction fees 5,888 3,6325,650 5,650

10,135 6,69022,600 22,62386,419 89,632

Commissions and other portfolio transaction costs 52,657 26,71417,296 5,467

Interest expense 260 78204,945 162,927

Increase in net assets attributable to holders of redeemable units $ 1,507,725 $ 1,649,435

186,933.29 114,646.63

$ 8.07 $ 14.39


Increase in net assets attributable to holders of redeemable units per unit

Average redeemable units outstanding

Custodial and administration fees

Performance fees

Trustee feesUnitholder communication feesFund valuation fees

Withholding expense

Net realized gain on sale of investmentsNet foreign exchange gain (loss) on cashNet other gain

Dividend income

3

COWAN ABSOLUTE RETURN FUNDSTATEMENT OF CASH FLOWS


2017 2016

Cash flows from operating activities

$ 1,507,725 $ 1,649,435Adjustments for:

(1,308) 3,423(209,492) (1,931,878)

(1,067,646) 436,689(29,517,408) (18,793,331)18,034,729 17,524,534

3,715(29,713) 2,326

(3,213) (51,052)(11,286,326) (1,156,139)

Cash flows from financing activities11,315,640 1,455,201

Amount paid on redemption on units (275,540) (375,423)11,040,100 1,079,778

(246,226) (76,361)

1,308 (3,423)283,291 363,075

$ 38,373 $ 283,291

$ 7,448 $ 7,741$ 365,906 $ 298,067


Cash at end of period

Interest receivedDividends received, net of withholding taxes

Decrease in cash

Cash at beginning of periodForeign exchange gain (loss) on cash

Amount received from the issuance of units

Increase in net assets attributable toholders of redeemable units

Change in interest receivable

Net foreign exchange (gain) loss on cashNet realized gain on sale of investmentsChange in unrealized (appreciation) depreciation of investments

Change in other liabilities

Purchase of investmentsProceeds from the sale of investments

Change in dividends receivable

4

COWAN ABSOLUTE RETURN FUND STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE UNITS


2017 2016

at beginning of period $ 17,285,000 $ 12,207,937

of redeemable units $ 1,507,725 $ 1,649,435

(237,120) (190,933)(206,100) (1,906,852)(443,220) (2,097,785)

15,438,070 3,815,551Amount received from reinvestment of distributions 443,220 2,097,785

(285,690) (387,923)15,595,600 5,525,413

16,660,105 5,077,063

$ 33,945,105 $ 17,285,000

142,286 114,012120,734 31,834

(2,451) (3,560)260,569 142,286


Net increase from redeemable unit transactionsAmount paid on redemptions of units

at end of period

Balance - end of period

Units issued and outstandingBalance - beginning of periodUnits issued for cashUnits redeemed

Net increase in net assets attributable to holders

Net assets attributable to holders of redeemable units

of redeemable units


Increase in net assets attributable to holders

Redeemable unit transactionsAmount received from the issuance of units

Distributions paid or payable to holders of redeemable unitsFrom net investment incomeFrom net realized capital gainsTotal distributions to holders of redeemable units

5

COWAN ABSOLUTE RETURN FUNDSCHEDULE OF INVESTMENT PORTFOLIO

AS AT DECEMBER 31, 2017

No. ofShares

AverageCost

CurrentValue

% of NetAssets

DHX Media Ltd. 485,000 $ 2,542,093 $ 2,201,900142,300 1,047,134 1,044,482

9,300 96,162 111,6933,685,389 3,358,075 9.89

300,000 1,800,300 1,728,0001,800,300 1,728,000 5.09

5,225 4,755 836100,000 1,158,322 1,048,719

1,163,077 1,049,555 3.09

168,700 1,477,014 1,710,618457,900 2,500,275 2,158,998200,000 765,240 1,100,000

4,742,529 4,969,616 14.64

11,391,295 11,105,246 32.71

65,000 859,744 997,661169,641 857,683 723,583105,000 1,779,369 1,223,506554,938 1,714,285 898,25437,900 909,665 1,063,704

105,000 995,371 1,169,029Mitchells & Butlers PLC 374,057 1,590,071 1,794,853

285,000 634,682 1,570,675100,000 650,581 826,278

Platform Specialty Products Corp. 100,000 1,084,120 1,242,926743,582 760,693 1,005,61535,000 1,633,317 1,560,299

375,000 1,167,874 1,708,17012,500 467,732 552,238

TOTAL FOREIGN EQUITIES 15,105,187 16,336,791 48.13

26,496,482 27,442,037 80.84

(58,116)26,438,366 27,442,037 80.84

6,503,068 19.16

33,945,105 100.00

TOTAL EQUITIES

OTHER ASSETS, LESS LIABILITIES

TOTAL NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE UNITS

Less transaction cost included in average costTOTAL INVESTMENTS

Stock Spirits Group PLCWeyerhaeuser Co.

Industrials

C&C Group PLCHoughton Mifflin Harcourt Co.

Limoneira Co.

Belmond Ltd., Class 'A'

Bird Construction Inc.Ceres Global AG Corp.Conifex Timber Inc.

Short QQQ ProShares

Mota-Engil SGPS SAMurgitroyd Group PLC

Interserve PLC

Massimo Zanetti Beverage Group SPA

Security

Exchange Traded FundsHorizons BetaPro S&P/TSX 60 Bear Plus Fund ETF, Class 'A'

TOTAL CANADIAN EQUITIES

Ridley Corp. Ltd.

FOREIGN EQUITIES

Financials

CANADIAN EQUITIES

Consumer Discretionary

Freshii Inc., Class 'A'TWC Enterprises Ltd.

Mainstreet Health Investments Inc.Dundee Corp., Warrants, 2019/06/30

6

2017 2016Assets

Non-derivative financial assets (note 4) $ 27,540,359 $ 14,678,906Cash 116,893 65,670Subscription receivable 11,030,470 1,589,200Interest receivable 177,833 62,449Dividends receivable 26,078 15,392

38,891,633 16,411,617

LiabilitiesRedemptions payable 42,640 12,500Other accrued expenses 2,755 2,755

45,395 15,255

Net assets attributable to holders of redeemable units $ 38,846,238 $ 16,396,362

Net assets attributable to holders of redeemable units per unit $ 128.73 $ 118.88


COWAN INCOME OPPORTUNITIES FUND STATEMENT OF FINANCIAL POSITION

AS AT DECEMBER 31ST

7

2017 2016

IncomeInterest for distribution purposes $ 670,522 $ 368,237Dividend income 462,914 222,721

Other changes in fair value of investmentsNet realized gain on sale of investments 265,670 344,553Net foreign exchange (loss) gain on cash (4,807) 22,613Net other loss (17,809) (12,904)Change in unrealized appreciation of investments 373,443 1,133,228

1,749,933 2,078,448

Expenses (notes 8, 9 and 10)Custodial and administration fees 1,879 980Transaction fees 2,454 2,265Trustee fees 5,650 5,650Unitholder communication fees 9,068 2,536Fund valuation fees 20,340 20,340Commissions and other portfolio transaction costs 7,579 6,323Interest expense 4 20

46,974 38,114

Increase in net assets attributable to holders of redeemable units $ 1,702,959 $ 2,040,334

Average redeemable units outstanding 186,220.14 107,804.50

Increase in net assets attributable to holders of redeemable unitsper unit $ 9.15 $ 18.93


COWAN INCOME OPPORTUNITIES FUND STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED DECEMBER 31ST

8

2017 2016

Cash flows from operating activities

$ 1,702,959 $ 2,040,334Adjustments for:

4,807 (22,613)(265,670) (344,553)(373,443) (1,133,228)

(43,907,117) (39,017,109)31,684,777 25,819,494

(115,384) (65,959)(10,686) (15,392)

2,755(11,279,757) (12,736,271)

Cash flows from financing activities11,676,300 12,904,328

Amount paid on redemption on units (340,513) (125,000)11,335,787 12,779,328

56,030 43,057

(4,807) 22,61365,670

$ 116,893 $ 65,670

$ 555,138 $ 302,278$ 452,228 $ 207,329


Dividends received, net of withholding taxes

Increase in cash

Cash at beginning of periodForeign exchange (loss) gain on cash

Amount received from the issuance of units

Cash at end of period

Interest received

Net foreign exchange loss (gain) on cashNet realized gain on sale of investmentsChange in unrealized appreciation of investments

Change in other liabilities

COWAN INCOME OPPORTUNITIES FUNDSTATEMENT OF CASH FLOWS


Purchase of investmentsProceeds from the sale of investments

Increase in net assets attributable toholders of redeemable units

Change in dividends receivableChange in interest receivable

9

2017 2016

at beginning of period $ 16,396,362 $

of redeemable units $ 1,702,959 $ 2,040,334

(1,080,780) (550,849)(243,260) (345,254)

(1,324,040) (896,103)

21,117,570 14,493,5281,324,040 896,103(370,653) (137,500)

22,070,957 15,252,131

22,449,876 16,396,362

$ 38,846,238 $ 16,396,362

137,920166,779 139,152

(2,923) (1,232)301,776 137,920


COWAN INCOME OPPORTUNITIES FUND STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE UNITS


at end of period

Balance - end of period

Units issued and outstandingBalance - beginning of periodUnits issued for cashUnits redeemed

Net increase in net assets attributable to holders


of redeemable units

Redeemable unit transactionsAmount received from the issuance of units

Net increase from redeemable unit transactionsAmount paid on redemptions of units


Increase in net assets attributable to holders

From net investment income

Amount received from reinvestment of distributions

Distributions paid or payable to holders of redeemable units

From net realized capital gainsTotal distributions to holders of redeemable units

10

COWAN INCOME OPPORTUNITIES FUNDSCHEDULE OF INVESTMENT PORTFOLIO

AS AT DECEMBER 31, 2017

No. ofShares

AverageCost

CurrentValue

% of NetAssets

7,500 238,139 242,91631,000 563,730 778,10010,000 250,000 255,40035,000 534,938 856,45015,000 375,000 384,45073,700 883,438 992,73924,787 590,565 607,52923,900 573,915 597,7392,500 58,148 59,3755,900 145,189 147,028

29,600 675,226 740,00025,000 307,779 493,25014,400 219,045 314,20813,500 230,230 333,99014,800 267,929 376,51230,300 561,215 582,06315,000 378,600 379,65024,400 380,313 548,5127,500 187,050 196,125

11,500 275,675 300,0357,696,124 9,186,071 23.65

7,696,124 9,186,071 23.65

ParValue

AverageCost

CurrentValue

% of NetAssets

250,000 249,912 246,950249,912 246,950 0.64

Corporate750,000 760,462 777,500150,000 135,000 156,075

1,000,000 1,015,726 1,030,000325,000 354,250 353,844567,000 571,961 572,670

1,000,000 1,320,915 1,262,347500,000 539,375 605,000

1,000,000 991,056 989,8501,000,000 1,000,000 982,0671,200,000 1,199,227 1,162,6801,150,000 1,148,876 1,137,720

833,000 803,765 803,845400,000 509,597 479,253200,000 200,000 202,330700,000 725,500 768,396850,000 877,458 877,979250,000 261,250 260,224500,000 498,750 528,437500,000 500,000 505,750

13,413,168 13,455,967 34.64

TOTAL CANADIAN BONDS 13,663,080 13,702,917 35.28

986,000 1,263,505 1,232,320700,000 897,891 916,533200,000 224,917 207,281

2,386,313 2,356,134 6.06

TOTAL BONDS 16,049,393 16,059,051 41.34

23,745,517 25,245,122 64.99

SHORT-TERM NOTES550,000 548,812 549,094500,000 496,270 497,493150,000 148,467 149,628

1,100,000 1,098,900 1,099,022TOTAL SHORT-TERM NOTES 2,292,449 2,295,237 5.91

(7,066)26,030,900 27,540,359 70.90

11,305,879 29.10

38,846,238 100.00

Honda Canada Finance Inc. Discount Note, 1.49%, 2018/05/04Royal Bank of Canada Bankers' Acceptance, 1.05%, 2018/03/29Toronto-Dominion Bank (The) Bankers' Acceptance, 1.35%, 2018/01/25

Bank of Nova Scotia Bankers' Acceptance, 1.34%, 2018/02/15

Pembina Pipeline Corp., Preferred, Class 'A', Series '3', Variable Rate, Perpetual

CANADIAN BONDS

TOTAL EQUITIES

Brookfield Residential Properties Inc., Callable, 6.125%, 2023/05/15

Westcoast Energy Inc., Preferred, Series '10', Variable Rate, Perpetual

Air Canada, Callable, 4.750%, 2023/10/06

GovernmentCity of London, 1.800%, 2021/03/07

Cineplex Inc., Convertible, Callable, 4.500%, 2018/12/31Canexus Corp., Restricted, 7.875%, 2023/09/20Canexus Corp., Convertible, Callable, 6.500%, 2021/12/31

Clearwater Seafoods Inc., Callable, 6.875%, 2025/05/01

Crombie REIT, Series 'C', 2.775%, 2020/02/10

Preferred

Brookfield Infrastructure Partners L.P., Preferred, Series '7', Variable Rate, Perpetual

CANADIAN EQUITIES

Security

Element Fleet Management Corp., Preferred, Series 'A', Variable Rate, Perpetual

Northland Power Inc., Preferred, Series '1', Variable Rate, Perpetual

ECN Capital Corp., Preferred, Series 'C', Variable Rate, Perpetual

OTHER ASSETS, LESS LIABILITIES

Element Fleet Management Corp., Preferred, Series 'C', Variable Rate, Perpetual

Algonquin Power & Utilities Corp., Preferred, Series 'D', Variable Rate, Perpetual

Brookfield Renewable Power Preferred Equity Inc, Preferred, Class 'A', Series '3', Variable Rate

Enbridge Inc., Preferred, Series 'D', Variable Rate, PerpetualFortis Inc., Preferred, Series 'G', Variable Rate, PerpetualManulife Financial Corp., Preferred, Class '1', Series '5', Variable Rate, Convertible, PerpetualManulife Financial Corp., Preferred, Class '1', Series '7', Variable Rate, Perpetual

Partners Value Split Corp., 4.85%, Preferred, Series '5', Callable

Capstone Infrastructure Corp., Preferred, Series 'A', Variable Rate, CallableDundee Corp., 7.50%, Preferred, Series '5', Perpetual

TransCanada Corp., Preferred, Series '15', Variable Rate, Perpetual

AltaGas Ltd., Preferred, Series 'C', Variable Rate, Convertible, Perpetual

Capital Power Corp., Preferred, Series '9', Variable Rate, Perpetual

ECN Capital Corp., Preferred, Series 'A', Variable Rate, Perpetual

TOTAL NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE UNITS

Security

Less transaction cost included in average costTOTAL INVESTMENTS

TOTAL INVESTMENTS BEFORE SHORT-TERM NOTES

Constellation Software Inc., Series '1', Variable Rate, Puttable, Callable, 7.900%, 2040/03/31

DHX Media Ltd., Convertible, Callable, 5.875%, 2024/09/30Ford Credit Canada Co., 2.710%, 2022/02/23Holloway Lodging Corp., Series 'B', Convertible, Callable, 6.250%, 2020/02/28Mainstreet Health Investments Inc., Convertible, Callable, 5.000%, 2022/01/31Morguard Corp., Series 'C', Callable, 4.333%, 2022/09/15Quebecor Media Inc., Callable, 6.63%, 2023/01/15

Superior Plus L.P., Callable, 6.50%, 2021/12/09

FOREIGN BONDSDean Foods Co., Callable, 6.500%, 2023/03/15

Teva Pharmaceutical Finance Netherlands III BV, 3.150%, 2026/10/01

Daimler Canada Finance Inc., 1.570%, 2020/05/25

Russel Metals Inc., Callable, 6.000%, 2022/04/19Sobeys Inc., Callable, 4.700%, 2023/08/08

Timbercreek Financial Corp., Convertible, Callable, 5.450%, 2022/03/31

Popular Inc., Callable, 7.00%, 2019/07/01

11

COWAN ASSET MANAGEMENT POOLED FUNDSNOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED DECEMBER 31, 2017

12

1. GENERAL INFORMATION

The Cowan Absolute Return Fund and the Cowan Income Opportunities Fund (the “Funds”), are organized under the laws ofthe Province of Ontario and governed by a trust agreement between Cowan Asset Management Limited (the “Manager”) andCIBC Mellon (the “Trustee”) dated December 9, 2013.

The Funds’ investment activities are managed by the Manager. The Manager is a wholly owned subsidiary of PrincetonHoldings Limited, an Ontario, Canada based company. The Funds’ custodian and administrator is CIBC Mellon. Theregistered office of the Funds is located at 705 Fountain Street N., Cambridge, Ontario, Canada, N1R 5T2.

The Cowan Absolute Return Fund was established on December 19, 2013, and the units of the Fund were first sold onJanuary 2, 2014, its inception date. The Cowan Income Opportunities Fund was established and units were first sold onJanuary 4, 2016.

Each Fund may have an unlimited number of classes of units, and may issue an unlimited number of units of each class. Allclasses of units of the Funds are redeemable at the unitholders’ option. At present there is only one class of units in eachFund.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of preparation

These financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) asissued by the International Accounting Standards Board (“IASB”).

The financial statements have been prepared on a going concern basis using the historical-cost convention. However, eachFund is an investment entity and primarily all financial assets and financial liabilities are measured at fair value in accordancewith IFRS. Accordingly, the Funds’ accounting policies for measuring the fair value of investments are consistent with thoseused in measuring the Net Asset Value for transactions with unitholders.

In applying IFRS, management may make estimates and assumptions that affect the reported amounts of assets, liabilities,income and expenses during the reporting periods. Actual results may differ from such estimates.

The financial statements have been presented in Canadian dollars, which is the functional currency of the Funds.

Financial instruments

(i) Classification and recognition of financial instruments

In accordance with IAS 39 Financial Instruments: Recognition and Measurement, financial assets and financial liabilitiesare classified at initial recognition into the following categories:

Financial assets and liabilities at fair value through profit or loss

The category of financial assets and liabilities at fair value through profit or loss is sub-divided into:

Financial assets and liabilities classified as held-for-trading: Financial assets and liabilities are classified as held for tradingif they are acquired for the purpose of selling and/or repurchasing in the near term. Derivatives and securities sold shortheld by the Funds are classified as held-for-trading and do not meet the definition of effective hedging instruments asdefined by IAS 39. These investments are acquired principally for the purpose of generating a profit from short-termfluctuations in price.

Financial instruments designated as fair value through profit or loss: All investments held by the Funds are designated asfair value through profit or loss upon initial recognition. Investments in this category include equities, bonds and otherinterest-bearing investments. These financial assets are designated upon initial recognition on the basis that they are partof a group of financial assets that are managed and have their performance evaluated on a fair value basis, in accordancewith risk management and investment strategies of the Funds, as set out in the Funds’ offering memorandum.



13

Receivables

Receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an activemarket. The Funds include in this category amounts receivable relating to portfolio investments and other short-termreceivables.

Other financial liabilities

This category includes all financial liabilities, other than those classified as fair value through profit or loss. This includesamounts payable for portfolio securities purchased and other accrued liabilities.

A financial asset or a financial liability is recognized when a Fund becomes a party to the contractual provisions of theinstrument. Purchases or sales of financial assets that require delivery of assets within the time frame generally establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date, i.e., the date that aFund commits to purchase or sell the asset.

(ii) Valuation of financial instruments

Financial assets and financial liabilities designated as fair value through profit or loss are recorded in the Statements ofFinancial Position at fair value upon initial recognition. All transaction costs such as brokerage commissions incurred inthe purchase and sale of securities for such instruments, are recognized directly in profit or loss. Receivables and otherfinancial liabilities (other than those classified as held-for-trading) are measured initially at their fair value plus any directlyattributable incremental costs of acquisition or issue. For financial assets and liabilities where the fair value at initialrecognition does not equal the transaction price, the difference is recognized in the Statements of Comprehensive Income,unless specified otherwise.

After initial measurement, the Funds measure financial instruments which are classified as fair value through profit or loss,at fair value. Subsequent changes in the fair value of those financial instruments (i.e. the excess/shortfall of the sum of thefair value of portfolio investments over/below the sum of the average cost of each portfolio investment) are recorded inunrealized appreciation (depreciation) of investments. The applicable period change in unrealized appreciation(depreciation) of investments is included on the Statements of Comprehensive Income.

The average cost of portfolio investments represents the sum of the average cost of each portfolio investment. For thepurposes of determining the average cost of each portfolio investment, the purchase price of portfolio investments acquiredby each Fund is added to the average cost of the particular portfolio investment immediately prior to the purchase. Theaverage cost of a portfolio investment is reduced by the number of shares or units sold multiplied by the average cost ofthe portfolio investment at the time of the sale. The average cost per share or unit of each portfolio investment sold isdetermined by dividing the average cost of the portfolio investment by the number of shares or units held immediately priorto the sale transaction. Transaction costs incurred in portfolio transactions are excluded from the average cost ofinvestments and are recognized immediately in net income and are presented as a separate expense item in the financialstatements. Realized gains and losses from the sale of portfolio investments are also calculated based on the averagecosts, excluding transaction costs, of the related investment.

Receivables, other assets and liabilities (other than those classified as fair value through profit or loss) are measured atamortized cost.

The Funds’ obligation for net assets attributable to holders of redeemable units is presented at the redemption amount.

The Funds measure financial instruments, such as equities, bonds and other interest-bearing investments at fair value ateach reporting date. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderlytransaction between market participants at the measurement date. The fair value measurement is based on thepresumption that the transaction to sell the asset or transfer the liability takes place either in the principal market for theasset or liability or, in the absence of a principal market, in the most advantageous market for the asset or liability. Theprincipal or the most advantageous market must be accessible to the Funds.

The fair values of each specific type of investments and derivatives are determined in the following manner:



14

Portfolio investments

Portfolio investments listed on recognized public securities exchanges are valued using their last traded market price onthe securities exchange when the price falls within the day’s bid-ask spread. Debt securities are recorded at their fair value,established by the last traded price on the over-the-counter (“OTC”) market when that price falls within that day’s bid-askspread. In circumstances where the last traded price is not within the bid-ask spread, the Manager determines the pointwhen the bid-ask spread that is most representative of fair value based on the specific facts and circumstances. Certaininvestments that are not valued using the last traded price on the securities exchange can be valued based on otherobservable market data at the discretion of the Manager. If no trade volume is reported to have taken place, closing bidquotations for long positions and closing ask quotations for short positions from the primary exchange or market makerswill be used. For all other investments not traded in an active market, the fair value is determined by using valuationtechniques deemed to be appropriate in the circumstances. Valuation techniques include the market approach (i.e., usingrecent arm's-length market transactions adjusted as necessary and reference to the current market value of anotherinstrument that is substantially the same) and the income approach (i.e., discounted cash flow analysis and option pricingmodels making as much use of available and supportable market data as possible).

Other financial assets and liabilities

For all other financial assets and liabilities, the carrying value is an approximation of the fair value, including, cash, short-term deposits, dividends and accrued interest receivables, amount receivable from unitholders, due from brokers, duefrom related parties, other assets, payable to unitholders, due to brokers, due to related parties and other liabilities.

Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount reported in the Statements of Financial Position ifthere is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a netbasis, or to realize the asset and settle the liability simultaneously. For the year ended December 31, 2017 there was nosuch off-setting.

Income recognition

(i) Interest income for distribution purposes

The interest for distribution purposes shown on the Statements of Comprehensive Income represents the coupon interestreceived by the Funds accounted for on an accrual basis. The Funds do not amortize premiums paid or discounts receivedon the purchase of fixed income securities except for zero coupon bonds which are amortized on a straight line basis. Theinterest for distribution purposes is the tax basis of calculating the interest received and which is subject to tax.

(ii) Dividend revenue

Dividend revenue is recognized when the Funds' right to receive the payment is established. Dividend revenue is presentedgross of any non-recoverable withholding taxes, which are disclosed separately in the Statements of ComprehensiveIncome.

Functional and presentation currency

The Funds’ functional currency is the Canadian dollar (unless otherwise noted), which is the currency of the primaryeconomic environment in which they operate. The Funds’ performance is evaluated and its liquidity is managed inCanadian dollars. Therefore, the Canadian dollar is considered as the currency that most faithfully represents the economiceffects of the underlying transactions, events and conditions. The Funds’ presentation currency is also the Canadian dollar,unless otherwise noted.

Foreign currency translations

Transactions during the year, including purchases and sales of securities, income and expenses, are translated intoCanadian dollars at the rate of exchange prevailing on the date of the transaction. Monetary assets and liabilitiesdenominated in foreign currencies are retranslated at the functional currency rate of exchange ruling at the reporting date.Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchangerates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency aretranslated using the exchange rates at the date when the fair value was determined.



15

Foreign currency transaction gains and losses on financial instruments classified as fair value through profit or loss areincluded in profit or loss in the Statements of Comprehensive Income as part of the "net realized gains on sale ofinvestments".

Significant accounting judgments, estimates and assumptions

The preparation of the Funds' financial statements requires management to make judgments, estimates and assumptionsthat affect the reported amounts recognized in the financial statements and disclosure of contingent liabilities. However,uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustment tothe carrying amount of the asset or liability affected in future periods.

(i) Judgments

In the process of applying the Funds' accounting policies, management has made the following judgments, which have themost significant effect on the amounts recognized in the financial statements:

Assessment as investment entity

Entities that meet the definition of an investment entity within IFRS 10 are required to measure their subsidiaries at fairvalue through profit or loss rather than consolidate them. The criteria which define an investment entity are, as follows: an entity that obtains funds from one or more investors for the purpose of providing those investors with

investment services; an entity that commits to its investors that its business purpose is to invest funds solely for returns from capital

appreciation, investment income or both; and an entity that measures and evaluates the performance of substantially all of its investments on a fair value basis.

The Funds’ offering memorandum details the objective of providing investment management services to investors, whichincludes investing in equities, fixed income securities, preferred shares, certain derivatives and cash and cash equivalentsfor the purpose of returns in the form of investment income and capital appreciation.

The Funds report to their investors via annual investor information, and to their management, via internal managementreports, on a fair value basis. All investments are reported at fair value to the extent allowed by IFRS in the Funds’ financialstatements. The Funds have a clearly documented exit strategy for all of its investments.

The Manager has also concluded that each of the Funds meet the additional characteristics of an investment entity, inthat each Fund has more than one investment; the investments are predominantly in the form of equities and similarsecurities; each Fund has more than one investor and its investors are not related parties.

These conclusions will be reassessed on an annual basis if any of these criteria or characteristics change.

(ii) Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, whichhave a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the nextfinancial year, are discussed below. The Funds’ base assumptions and estimates on parameters available when thefinancial statements were prepared. However, existing circumstances and assumptions about future developments maychange due to market changes or circumstances arising beyond the control of the Funds. Such changes are reflected inthe assumptions when they occur.

Fair value of financial instruments

When the fair values of financial assets and financial liabilities recorded in the Statements of Financial Position cannot bederived from active markets, their fair value is determined using a variety of valuation techniques that include the use ofvaluation models. The inputs to these models are taken from observable markets where possible, but where this is notfeasible, estimation is required in establishing fair values. The estimates include consideration of liquidity and model inputsrelated to items such as credit risk (both own and counterparty's), correlation and volatility. Changes in assumptions aboutthese factors could affect the reported fair value of financial instruments in the Statements of Financial Position and thelevel where the instruments are disclosed in the fair value hierarchy. The models are tested for validity by calibrating toprices from any observable current market transactions in the same instrument (without modification or repackaging) whenavailable. To assess the significance of a particular input to the entire measurement, the Funds each perform a sensitivityanalysis or apply stress testing techniques.



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3. ACCOUNTING STANDARDS ISSUED BUT NOT YET ADOPTED

IFRS 9, Financial Instruments

IFRS 9 Financial Instruments replaces IAS 39 Financial Instruments: Recognition and Measurement and is effective forannual periods beginning on or after January 1, 2018, with early application permitted. IFRS 9 brings together threeaspects of the accounting for financial instruments: classification and measurement, impairment and hedge accounting.

The Funds will adopt IFRS 9 for annual periods beginning January 1, 2018. Based on the Funds’ business model andcontractual cash flow characteristics, the Manager anticipates that all portfolio investments will continue to be measuredat fair value. As the Funds do not apply hedge accounting and primarily all financial instruments are measured at fairvalue, the Manager expects no significant impact on the Funds’ net assets and results of operations on adoption of IFRS9.

IFRS 15, Revenue from Contracts with Customers

IFRS 15 Revenue from Contracts with Customers establishes a five-step model to account for revenue arising fromcontracts with customers and is effective for annual periods beginning on or after January 1, 2018, with early adoptionpermitted. Given that primarily all of the revenue streams of the Funds fall outside of the scope of IFRS 15, the Managerhas assessed that there is minimal impact to the financial statements arising on the adoption of this standard.

4. RISK MANAGEMENT

Each Funds’ objective in managing risk is the creation and protection of unitholder value. Risk is inherent in the Funds’activities, but it is managed at the fund and security level through a process of ongoing identification, measurement andmonitoring, subject to risk limits and other controls. The Manager utilizes various internal controls to oversee the Funds’investment activities, including monitoring compliance with investment objectives and strategies, internal guidelines andsecurities regulations.

The Funds are exposed to market risk (which includes interest rate risk, currency risk and other price/market risk), portfolioconcentration risk, credit risk and liquidity risk arising from financial instruments held.

Market risk

Interest rate risk

Prices of fixed income securities generally increase when interest rates decline and decrease when interest rates rise.This risk is known as interest rate risk. Prices of longer-term fixed income securities will generally fluctuate more inresponse to interest rate changes than would shorter-term securities. Due to the nature of short-term fixed incomesecurities with a remaining term-to-maturity of less than one year, these investments are not generally exposed to asignificant interest rate risk.

As at December 31, 2017 and December 31, 2016, the Cowan Absolute Return Fund held no fixed income securities andwas not exposed to interest rate risk, therefore a change in the prevailing interest rates would have had no impact on theFund.

The tables below summarize the Cowan Income Opportunities Fund’s exposure to interest rate risk. It includes the assetsand trading liabilities at fair values, categorized by the earlier of contractual re-pricing or maturity dates.

Cowan Income Opportunities Fund at December 31, 2017Less than 1 year 1 - 3 years 3 - 5 years > 5 years Total

Bonds 572,670 3,692,295 5,008,420 6,785,666 16,059,051

Cowan Income Opportunities Fund at December 31, 2016Less than 1 year 1 - 3 years 3 - 5 years > 5 years Total

Bonds 689,896 2,659,687 1,788,209 5,137,792

As at December 31, 2017, had the prevailing interest rates raised or lowered by 1%, with all other variables held constant,net assets of the Cowan Income Opportunities Fund would have decreased or increased, respectively, by approximately$584,531 (2016 - $184,721).



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Currency risk

Currency risk is the risk that the value of an investment will fluctuate due to changes in foreign exchange rates. The Fundsare exposed to this risk to the extent that they invest in securities denominated or traded in currencies other than theFunds’ reporting currency. Forward foreign currency contracts may also be used to hedge a portion of the Funds’ foreigncurrency exposure.

The tables below indicate the currencies to which the Funds had significant exposure as at period end, on its tradingmonetary, non-monetary assets and liabilities.

Cowan Absolute Return Fund as at December 31, 2017Currency risk exposed

holdingForward foreign

exchange contractsTotal

exposureAs a % ofnet assets

U.S. Dollar 7,702,176 7,702,176 22.69%Australian Dollar 1,005,656 1,005,656 2.96%British Pound 5,259,254 5,259,254 15.49%Euro 3,486,068 3,486,068 10.27%

Cowan Absolute Return Fund as at December 31, 2016Currency risk exposed




U.S. Dollar 5,381,213 5,381,212 31.13%Australian Dollar 667,740 667,740 3.86%British Pound 1,938,947 1,938,947 11.22%Euro 640,419 640,419 3.71%

As at December 31, 2017, had the Canadian dollar strengthened or weakened by 5% in relation to all currencies, with allother variables held constant, net assets of the Cowan Absolute Return Fund would have decreased or increased,respectively, by approximately $872,658 (2016 - $431,416). In practice, the actual trading results may differ from thissensitivity analysis and the difference could be material.

Cowan Income Opportunities Fund as at December 31, 2017Currency risk exposed




U.S. Dollar 4,425,126 4,425,126 11.39%

Cowan Income Opportunities Fund as at December 31, 2016Currency risk exposed




U.S. Dollar 1,043,062 1,043,062 6.36%

As at December 31, 2017, had the Canadian dollar strengthened or weakened by 5% in relation to all currencies, with allother variables held constant, net assets of the Cowan Income Opportunities Fund would have decreased or increased,respectively, by approximately $221,256 (2016 - $52,153). In practice, the actual trading results may differ from thissensitivity analysis and the difference could be material.

Other price/market risk

Other price/market risk is the risk that the value of investments will fluctuate as a result of changes in market conditions.Several factors can influence market trends, such as economic developments, changes in interest rates, political changes,and other events. All investments are exposed to other price/market risk.

As at December 31, 2017, a 5% increase or decrease in stock prices would have increased or decreased the CowanAbsolute Return Fund's Net Assets by approximately $1,372,102 (2016 - $689,308).

As at December 31, 2017, a 5% increase or decrease in stock prices would have increased or decreased the CowanIncome Opportunities Fund’s Net Assets by approximately $459,304 (2016 - $306,207).

In practice, the actual results may differ from this sensitivity analysis and the difference could be material.



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Portfolio concentration risk

Concentration indicates the relative sensitivity of the Funds’ performance to developments affecting a particular industryor geographical location. Concentrations of risk also arise when a number of financial instruments or contracts are enteredinto with the same counterparty, or where a number of counterparties are engaged in similar business activities, or activitiesin the same geographical region, or have similar economic features that would cause their ability to meet contractualobligations to be similarly affected by changes in economic, political or other conditions. The portfolio management teammanages concentration risk through diversification and a thorough understanding of each investment in the portfolios.

The following table groups the securities held by the Cowan Absolute Return Fund as at December 31, 2017 andDecember 31, 2016 by asset type and geographic region:

Portfolio breakdownDecember 31, 2017

% of net assetsDecember 31, 2016

% of net assets

Canadian equities 32.7% 31.4%Canadian preferredCanadian bondsForeign equitiesShort-term notesOther assets, less liabilities

48.1%

19.2%

48.3%5.2%

15.1%100.0% 100.0%

The following table groups the securities held by the Cowan Income Opportunities Fund as at December 31, 2017 andDecember 31, 2016 by asset type and geographic region:

Portfolio breakdownDecember 31, 2017

% of net assetsDecember 31, 2016

% of net assets

Canadian preferred 23.6% 37.4%Canadian bonds 35.3% 27.1%Foreign bondsShort-term notesOther assets, less liabilities

6.1%5.9%

29.1%

4.2%20.8%10.5%

100.0% 100.0%

Credit risk

Credit risk is the risk that the counterparty to a financial instrument, such as a fixed income security or a derivative contract,will fail to discharge an obligation or commitment that it has entered into with the Funds. The value of fixed incomesecurities as presented on the Schedules of Investment Portfolio includes consideration of the creditworthiness of theissuer and, accordingly, represents the maximum credit risk exposure of the Funds. The portfolio management teammonitors credit risk and credit ratings frequently but no less than monthly.

As at December 31, 2017 and December 31, 2016, the Cowan Absolute Return Fund did not invest in debt securities.

As at December 31, 2017 and December 31, 2016, the Cowan Income Opportunities Fund invested in debt securities withthe following credit ratings as determined by Standard and Poor’s:

December 31, 2017 December 31, 2016Debt securities by credit rating % of debt securities % of debt securities

AAA 1.5%A 6.1%BBB 19.6% 11.4%Below BBB 72.8% 88.6%

100.0% 100.0%



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Liquidity risk

The Funds are exposed to daily cash redemptions of redeemable units. Generally, the Funds retain sufficient cash andcash equivalent positions to maintain adequate liquidity. Liquidity risk also involves each Funds’ ability to convert an assetto cash at a fair price on a timely basis. Some securities are illiquid due to legal restrictions on their resale, the nature ofthe investment, or simply a lack of interested buyers for a particular security or security type. Certain securities maybecome less liquid due to changes in market conditions, such as interest rate changes or market volatility, which couldimpair the ability of a Fund to sell such securities quickly or at a fair price. All of the Funds’ financial liabilities, excludingderivatives, are short-term in nature and mature within 90 days after the period end. Where applicable, maturity dates ofliabilities relating to derivatives are disclosed in each Schedule of Investment Portfolio. The Funds’ liquidity position ismonitored on a daily basis.

Fair value measurement hierarchy

IFRS 13 Fair Value Measurement requires disclosures relating to fair value measurements using a three-level fair valuehierarchy. The level within which the fair value measurement is categorized in its entirety is determined on the basis of thelowest level input that is significant to the fair value measurement. Assessing the significance of a particular input requiresjudgment, considering factors specific to the asset or liability. The following shows financial instruments recognized at fairvalue, categorized between those whose fair value is based on:

Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities. Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement

is directly or indirectly observable. Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement

is unobservable.

For assets and liabilities that are recognized in the financial statements on a recurring basis, the Funds determine whethertransfers have occurred between levels in the hierarchy by re-assessing the categorization (based on the lowest level inputthat is significant to the fair value measurement as a whole) at the beginning of each reporting period.

The tables below summarize each Funds’ fair value hierarchy classification of its assets and liabilities.

Cowan Absolute Return Fundsas at December 31, 2017

Level 1 Level 2 Level 3 Total

Financial AssetsEquities $ 27,442,037 $ $ $ 27,442,037Total financial assets $ 27,442,037 $ $ $ 27,442,037

Cowan Absolute Return Fundas at December 31, 2016


Financial AssetsEquities $ 13,786,161 $ $ $ 13,786,161Short-term investments 899,084 899,084Total financial assets $ 13,786,161 $ 899,084 $ $ 14,685,245

Cowan Income Opportunities Fundas at December 31 , 2017


Financial AssetsEquities $ 9,186,071 $ $ $ 9,186,071Short-term investments 2,295,237 2,295,237Bonds 16,059,051 16,059,051Total financial assets $ 9,186,071 $ 18,354,288 $ $ 27,540,359



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Cowan Income Opportunities Fundas at December 31 , 2016


Financial AssetsEquities $ 6,124,131 $ $ $ 6,124,131Short-term investments 3,416,983 3,416,983Bonds 5,137,792 5,137,792Total financial assets $ 6,124,131 $ 8,554,775 $ $ 14,678,906

Fair values of financial instruments are classified as Level 1 when the related security or derivative is actively traded anda quoted price is available. If an instrument classified as Level 1 subsequently ceases to be actively traded, it is transferredout of Level 1. In such cases, instruments are reclassified into Level 2, unless the measurement of its fair value requiresthe use of significant unobservable inputs, in which case it is classified as Level 3. There were no transfers between levelsof beginning and ending balances in Level 3 during the year ended December 31, 2017 or December 31, 2016.

5. INTERESTS IN UNDERLYING FUNDS

The Funds invest in redeemable shares of other investment funds (“underlying funds”) to gain exposure to the investmentobjectives and strategies of the underlying funds. Each underlying fund is financed through the capital invested by theFunds, which entitles unitholders to a proportionate share of the underlying fund’s net assets. The Funds do not provideadditional financial or other support to the underlying funds. All underlying funds were established in and carry out theiroperations in Canada. The Funds’ interest in underlying funds are reported at fair value in “non-derivative financial assets”in its Statements of Financial Position and its Schedules of Investment Portfolio, which represents the Funds’ maximumexposure to financial loss.

The Funds had no significant interests in underlying funds at December 31, 2017 or at December 31, 2016.

6. INCOME TAXES AND WITHHOLDING TAXES

The Funds qualify as unit trusts under the provisions of Income Tax Act (Canada) and are not subject to income taxes onthat portion of their investment income that is distributed to unitholders. Such distributed income is taxable in the hands ofthe unitholders. Sufficient net income and realized capital gains of the Funds have been, or will be, distributed to theunitholders such that no tax is payable by the Funds and, accordingly, no provision for income taxes has been made inthe financial statements. The Funds have a taxation year-end of December 31.

Non-capital losses are available to be carried forward for 20 years. Capital losses for income tax purposes may be carriedforward indefinitely and applied against capital gains realized in future years. Where applicable, the Funds’ capital andnon-capital losses are reported in a footnote (Capital and non-capital losses) to the Statements of Changes in Net AssetsAttributable to Holders of Redeemable Units. As at December 31, 2017 and December 31, 2016 the Funds had no taxlosses available.

The Funds may be subject to withholding taxes imposed by certain countries on investment income and capital gains.Such income and gains are recorded on a gross basis and the related withholding taxes are shown as a separate expensein the Statements of Comprehensive Income. For the purpose of the Statements of Cash Flows, cash from investmentsis presented net of withholding taxes.



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7. INCREASE IN NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE UNITS PER UNIT

Increase in net assets from operations attributable to holders of redeemable units per unit of each class is calculated bydividing the increase in net assets attributable to holders of redeemable units from operations (excluding distributions), asreported in the Statements of Comprehensive Income, by the weighted average number of units in issue during the relatedperiod.

December 31, December 31,Cowan Absolute Return Fund 2017 2016

Average redeemable units outstanding 186,933 114,647

Income $ 420,363 $ 305,234

Transaction costs 52,657 26,714Other expenses 152,288 136,213Total expenses 204,945 162,927

Net investment income 215,418 142,307

Realized gains for the period 226,641 1,950,243Unrealized gains (losses) for the period 1,065,666 (443,115)Total gains 1,292,307 1,507,128

Increase in net assets from operations $ 1,507,725 $ 1,649,435

Total income per unit $ 2.25 $ 2.66Total expenses per unit (1.09) (1.42)

1.16 1.24

Realized gains per unit 1.21 17.02Unrealized gains (losses) per unit 5.70 (3.87)

6.91 13.15

Increase in net assets from operations per unit $ 8.07 $ 14.39



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December 31, December 31,Cowan Income Opportunities Fund 2017 2016

Average redeemable units outstanding 186,220 107,804

Income $ 1,133,436 $ 590,958

Transaction costs 7,579 6,323Other expenses 39,395 31,791Total expenses 46,974 38,114

Net investment income 1,086,462 552,844

Realized gains for the period 244,695 353,732Unrealized gains for the period 371,802 1,133,758Total gains 616,497 1,487,490

Increase in net assets from operations $ 1,702,959 $ 2,040,334

Total income per unit $ 6.09 $ 5.48Total expenses per unit (0.25) (0.35)

5.84 5.13

Realized gains per unit 1.31 3.28Unrealized gains per unit 2.00 10.52

3.31 13.80

Increase in net assets from operations per unit $ 9.15 $ 18.93

There was no difference between the net asset value per unit compared to the total equity per unit as shown on the Statementsof Financial Position.

8. MANAGEMENT FEES AND PERFORMANCE FEES

Management Fees

Management fees are paid to the Manager in consideration for providing, or arranging for the provision of management,distribution and portfolio advisory services.

The Funds’ management fees are charged at the client account level by the Manager and are not payable by the Funds.

Performance Fees

The Manager will be entitled to receive a performance incentive fee for the Cowan Absolute Return Fund that is accruedmonthly and paid at each fiscal year-end in an amount equal to 5% of the sum of the amount by which the Net Asset Valueper Unit of the Fund on each Valuation Date exceeds the “high-watermark” during the fiscal year. If the Net Asset Value perUnit of the Fund at any Valuation Date is below the “high-watermark,” no performance incentive fee will be accrued.Furthermore, no performance incentive fee will be accrued until the Net Asset Value per Unit of the Fund once again exceedsthe “high-watermark.” The “high-watermark” is defined as the Net Asset Value per Unit of the Fund when the last performancefee was paid. If a performance fee has never been paid, the “high-watermark” is equal to the Net Asset Value per Unit of theFund at inception.

The Cowan Income Opportunities Fund does not charge a performance fee.



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9. OPERATING EXPENSES

The Manager pays expenses relating to accounting, legal and audit fees. Advertising and promotional expenses are alsothe responsibility of the Manager.

The Funds are responsible for certain costs relating to the operations and administration of the Funds, including itsbrokerage fees, other fees and disbursements relating to the transactions of its portfolios, any interest expenses incurredby it, taxes, trustee fees, fund accounting costs, safekeeping and custodial fees, investor servicing costs and unitholderreporting costs. Operating expenses may be paid by the Manager and recovered from the Funds.

The Manager, at its sole discretion, may absorb a portion of operating expenses. Amounts waived/absorbed by theManager are reported in the Statements of Comprehensive Income. Such waivers and absorptions may be terminated atany time by the Manager. During the period the Manager did not waive/absorb any fees.

10. BROKERAGE COMMISSIONS AND SOFT DOLLARS

Broker fees and commissions paid by the Funds in connection with portfolio transactions are included as transaction costsin the Statements of Comprehensive Income of the Funds, where applicable. In allocating brokerage business,consideration may be provided to dealers that furnish research, statistical analysis, and other securities (referred to in theindustry as “soft dollar” arrangements). These goods and services are paid for with a portion of brokerage commissionsand assist in investment decision-making services to the Funds. The Manager did not have any soft dollar arrangementsduring the period.

Fixed income and certain other securities are transacted in an OTC market where participants are dealing as principals.Such securities are generally traded on a net basis and do not normally involve brokerage commissions, but typicallyincludes a “spread” (being the difference between the bid and offer prices on the security of the applicable marketplace).

11. RELATED PARTY TRANSACTIONS

As at December 31, 2017, parties related to the Manager held 107,201 units in the Cowan Absolute Return Fund (2016 –108,021 units). During the year ended December 31, 2017, parties related to the Manager acquired 396 units in the CowanAbsolute Return Fund (2016 – 1,074 units) and redeemed 1,216 units in the Fund (2016 – 3,278 units).

As at December 31, 2017, parties related to the Manager held 101,134 units in the Cowan Income Opportunities Fund(2016 – 102,019). During the year ended December 31, 2017, parties related to the Manager acquired 239 units in theCowan Income Opportunities Fund (2016 – 103,252) and redeemed 1,124 units in the Fund (2016 – 1,233).

All of the above transactions were made under the terms and conditions of the Trust Agreement.

Manager of the Funds

The Manager charges a management and performance fee for investment management and portfolio advisory servicesto the Funds as described above. These services are in the normal course of operations and are recorded at the amountof the consideration determined by the management fee rates. Management fees are reported in the Statements ofComprehensive Income. Amounts due to/from Manager at year end, if any, are reported in the Statements of FinancialPosition.

12. CAPITAL MANAGEMENT

Units issued and outstanding are considered to be capital of the Funds. The Funds are not subject to externally imposedcapital requirements and have no legal restrictions on the issue, repurchase or resale of redeemable shares beyond thoseincluded in the Funds’ Offering Memorandum. The capital received by the Funds is managed to achieve its investmentobjective of the Fund while maintaining liquidity to satisfy unitholder redemptions.

Units are redeemable at the Net Asset Value per unit. A right to redeem units of the Funds may be suspended with theapproval of the Canadian Securities Administrators. Changes in the units issued and outstanding for the period endedDecember 31, 2017 are reported in a footnote (Redeemable units issued and outstanding) to the Statements of Changesin Net Assets Attributable to Holders of Redeemable Units.



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13. FILING EXEMPTION

In accordance with Section 2.11(d) of National Instrument 81-106 (NI 81-106), Cowan Asset Management Limited, asManager of the Funds, has provided notice to the securities regulatory authority that it is relying on the exemption granted bySection 2.11 of NI 81-106, whereby Cowan Asset Management Limited will not be filing the annual financial statements forthe Fund with the securities regulatory authority.

Documents

COWAN ASSET MANAGEMENT POOLED FUNDS · 137,920 166,779 139,152 (2,923) (1,232) 301,776 137,920 See accompanying notes to the financial statements COWAN INCOME OPPORTUNITIES FUND STATEMENT